The new directors of JKX, the oil and gas company whose former board was ousted this year, warned of the challenges they face turning round the company as its losses deepened.

The company released its annual results on Monday, which showed pre-tax losses had increased from $53.7m in 2014 to $82.7m last year as it continued to adjust to low oil prices and volatility in Russia and Ukraine, where it operates.

Sales dropped from $146.2m in 2014 to $88.5m last year and capital spending fell from $42.3m in 2014 to just $8.7m.

Tom Reed, the new chief executive, told shareholders he had identified significant scope to improve output and reduce costs since taking over two months ago.

“There are many challenges facing the company, and the new board is committed to a new and transparent approach and to actively engage all shareholders and other stakeholders of the company in order to turn it around,” he said.

But at the same time, the company warned: “There remains a number of material uncertainties that may cast significant doubt about the group’s and company’s ability to continue as a going concern.”

Russell Hoare, the chief financial officer, listed the main problems as restrictions on doing business in Ukraine and low gas tariffs in Russia.

JKX’s share price fell 9 per cent to 23.9p on Monday.

The company has struggled in recent years as the falling oil price has been exacerbated by problems in Russia and Ukraine. Its problems came to a head earlier this year when Proxima Capital, run by Russian businessman Vladimir Tatarchuk, led a successful attempt to remove the former board.

Paul Ostling, the new chairman, said on Monday that the coup was a “rare example of genuinely successful shareholder activism in the long history of the London Stock Exchange.”

As well as cutting costs, the new management has said one of its top priorities is to settle a long-running legal case against the Ukrainian government over what it says are $270m in overpaid taxes.

Mr Reed told the Financial Times last month the case had distracted JKX from drilling for oil and gas, and said he wanted to end it quickly, even if it meant settling for a lower figure.

Mr Ostling said on Monday: “We have met with representatives of the Ukrainian Government in recent weeks to attempt to find a solution to all our production tax and licensing issues in-country and we are confident that an acceptable solution can be found.”