(Adds results, details)
OSLO, Feb 1 (Reuters) - Sweden’s Lundin Petroleum will start paying dividends as a recovery in the price of crude oil and cost cuts power record cash flows, the company said on Thursday.
The board proposed to pay out 4 Swedish crowns per share for the 2017 fiscal year, totalling about $175 million, and aims to increase the payout to at least $350 million next year.
“By maintaining very low cash operating costs we will be able to deliver increased free cash flows, be very active on the organic growth front and deliver sustainable dividends, thereby continuing to create long-term value for our shareholders,” Chief Executive Alex Schneiter said.
The independent oil company, 20 percent owned by Norway’s Statoil, posted a 55 percent rise in fourth-quarter core profit, beating market expectations.
Earnings before interest, tax, depreciation and amortisation (EBITDA) rose to $429.8 million from $277 million a year earlier and topped the $411 million expected by analysts.
“These results are driven by continued strong performance from our core producing assets which have generated the highest operating cash flow for the company to date, close to doubling operating cash flow and EBITDA compared to 2016,” Schneiter said.
Its capital spending is set to decline after investments in the development of Norway’s giant Johan Sverdrup field, where Lundin has a 22.6 percent stake, peaked last year. The field is due to come on stream in late 2019.
$1 = 7.8854 Swedish crowns Reporting by Nerijus Adomaitis, editing by Terje Solsvik and Jason Neely