London, 6 September, 2018 – Neptune Energy, the independent oil and gas exploration and production company, today has announced its H1 2018 results, including the contribution from the worldwide oil and gas exploration business of ENGIE, acquired on 15 February 2018, for the four and half months from completion.
Since completing this acquisition, Neptune has delivered a strong financial and operating performance, while driving its strategy forward. The company remains on target to meet previously announced full year guidance.
- Improved HSSE performance and culture
- Average production of 165.6 kboepd, above expectations
- Progressed developments across the portfolio and successfully appraised Sigrun in Norway
- Strengthened the business with senior management appointments and improved processes
- $0.9 bn EBITDAX1 for the first six months of 2018
- Strong operating cash flow of $598 mm (post-tax) and operating costs of $10.0/boe
- Successful inaugural $550 mm bond issue2 and long-term issue credit ratings of BB- and Ba3
- 0.65x net debt to 12-month pro forma EBITDAX
Portfolio and outlook
- VNG Norge – agreement to acquire oil-weighted assets with operated growth and synergies in Norway
- Seagull & Isabella – agreement to acquire a low-cost, near-term development and exploration in UK
- Full year production in line with previous guidance
- H2 focus on further strengthening the organisation, VNG integration, progressing projects and cost reduction
Sam Laidlaw, Executive Chairman, said: “In the first half of 2018, we delivered on our strategy to grow the business following the transformational acquisition of ENGIE’s E&P business. The bolt-on acquisitions of VNG Norge and Apache UK’s assets provide us with an increase in production and reserve life.
“Our current businesses and assets are outperforming expectations through a combination of strong production performance and financial results. This leaves us well-placed to continue building the business and take advantage of ongoing re-positioning within the E&P sector”.
Jim House, Chief Executive Officer, said: “Operational performance has been very good in the first half, with production above expectations. Cash flow generation has been strong on the back of this with robust liquidity and disciplined capital allocation across our key development projects.
“We expect to deliver in line with previous guidance for the full year 2018 as we focus on operational excellence, the delivery of our project pipeline and cost reduction”.
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- EBITDAX comprises net income for the period before income tax expense, financial expenses, financial income, non-recurring acquisition-related expenses, mark-to-market adjustments on commodity contracts exploration expense and depreciation and amortisation. Pro Forma for EPI acquisition.
- offering of 6 ⅝% senior notes in Neptune Energy Bondco plc (due 2025) in an aggregate principal amount of $550 million (closed 11 May 2018).
A call for holders of senior notes in Neptune Energy Bondco plc is scheduled for Thursday 6 September 2018 at 15.00 BST. To register for an invitation click here or visit our investor web page: www.neptuneenergy.com/en/investors
The H1 2018 financial report and presentation will also be available via our investor page.
Mob: +44 (0)7872 506 614
About Neptune Energy
Neptune Energy is an independent global E&P company and, having completed the acquisition of the exploration and production business of the ENGIE group in February 2018, is now active across the North Sea, North Africa and Asia Pacific. The business had production of 165,000 net barrels of oil equivalent per day during H1 2018 and 2P reserves at 31st December 2017 of 542 million barrels of oil equivalent. The Company, founded by Sam Laidlaw, is backed by CIC and funds advised by Carlyle Group and CVC Capital Partners.
For further information please visit: www.neptuneenergy.com
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