Calgary-based oil producer cuts dividend in half, blames COVID-19

Vermilion Energy Inc. reported a fourth-quarter profit of $1.5 million and cut its dividend in half due to weakness in commodity prices and reduced global economic prospects following the outbreak of the novel coronavirus.

The oil and natural gas producer says COVID-19 has altered individual, business and government behaviour and that these impacts are negative for the outlook for global economic growth, commodity prices in general, and oil demand and prices in particular.

Calgary-based Vermilion says it will now pay a monthly dividend of 11.5 cents per share, down from its earlier rate of 23 cents per share.

The cut in its payment to shareholders came as Vermilion reported a profit of a penny per share for quarter ended Dec. 31 compared with a profit of $323.4 million or $2.12 per share a year earlier.

Petroleum and natural gas sales totalled $388.8 million in its most recent quarter, down from $456.9 million in the fourth quarter of 2018.

Fund flows from operations in its fourth quarter totalled $215.6 million or $1.38 per diluted share compared with $222.3 million or $1.44 per diluted share in the last three months of 2018.