President Energy confident in second half as headwinds abate
Molecular Energies
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16:55 18/04/24
Argentina-focussed upstream oil and gas company President Energy updated the market on its first-half trading on Tuesday, reporting a 7% year-on-year improvement in sales to $23.5m, notwithstanding lower average sales prices compared to the same period last year.
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The AIM-traded firm said its adjusted EBITDA for the six month period stood at $8m, while its bank debt reduced to $4.82m as of Tuesday, from $10.15m at the start of the period.
Average net group production for the half-year was around 2,500 barrels of oil equivalent per day - up 8% on its full-year average for 2018, and notwithstanding the previously-announced operational outages and shut-ins in Argentina and Louisiana.
The board said that, with an “increasingly better” second half in prospect over the latter part of the first half, the company was “on track” for a projected group adjusted EBITDA for the full year of around $20m.
It said target average production guidance for the second half would be announced at the same time as the first half results, which it said should reflect the expected increase from the latter part of the first half as the benefit of the operational work being undertaken and planned started to impact, as well as the gradual bringing in of the ready-to-produce shut in production.
Interim results were expected to be announced towards the end of September.
On the operational front, President said its workover programme was still continuing, and added that a detailed review of the results so far would be given in September.
In addition to existing production, the firm said it had an estimated net 1,100 barrels of oil equivalent per day now tested, proven and ready to produce, subject to surface facilities being completed, save in the case of the Triche well in Louisiana which was subject to an ongoing workover.
The completion of those facilities would start to be effected “step-by-step” in the second half, with Louisiana production expected to start to be back on line by September.
Further, the company said additional hydrocarbon production was expected in due course from subsurface programmes, which in the normal course of planning were being re-evaluated and assessed in the light of knowledge gained from the workover programme and follow-on detailed subsurface analysis.
Concrete details of such were expected to be announced at the same time as the workover review in the first part of September.
“President has delivered positive results in the first half, notwithstanding the headwinds as previously announced which should now, step by step, be receding in the rear-view mirror,” said President Energy chairman Peter Levine.
“In the space of only some 20 months President has enjoyed a period of transformative progress including the successful integration of four valuable acquisitions, a strategic pan-regional pipeline, the bringing on of new production, generation of positive cash flow and attaining good margins.”
Despite that, Levine said the company’s share price - uncoupled from such progress - had dropped some 35% in value during that time.
“President remains confident as to its future prospects and success as an energy business and is examining initiatives to deliver value for shareholders.”