Seplat Energy Grows Profit by 83% to N81.33bn

Seplat Energy Plc has posted significant earnings growth for the financial year 2023, details from the independent energy company listed on both the Nigerian Exchange and the London Stock Exchange revealed.

In its audited results for the twelve months ended 31 December 2023, annual profit climbed by more than 83% to settle at N81.33 billion from N44.433 billion in the comparable period in 2022.

In local currency, revenue came in at about N697 billion representing about a 73% annual jump from N404 billion recorded in the year 2022.

In US dollar terms, the company’s profit attributable to equity holders for the 12 months ended Dec. 31, 2023, was $83.1 million, compared with $62.4 million a year ago.

Following a sterling performance, the board is recommending a final dividend of $0.03 per share and a special dividend of $0.03 for the period, payable to shareholders on record on April 26. It paid $0.025 and $0.05, respectively, a year ago.

Details showed that revenue grew by 12% year on year to $1,061.3 million from $951.8 million in 2022. The average realised oil price was $83.39 per barrel (bbl), lower than $101.67/bbl achieved in 2022.

Also, the average realised gas price settled at $2.90/Mscf, a decline from $2.82/Mscf in the comparable year. The company said unit production operating expenses rose marginally to $10.4/boe from $10.3/boe in 12 months.

Its audited result showed that cash generated from operations declined by 10% year on year to settle at $520 million due to the need to fund capital expenditure of $184 million and enhance shareholder returns.

Balance sheet strengthened with year-end cash at bank $450 million, from $404 million, excluding $128.3 million MPNU deposit. Net debt at year-end 2023 reduced to $306 million from $366 million in 2022..

Operational highlights

In 2023, Seplat revealed that its production averaged 47,758 boepd, up by 8% from 44,104 boepd in 2022, and within original guidance for the year.

Seplat said it drilled and completed 14 wells in 2023 of which 6 were completed in 4Q-2023, in line with its revised well program. It added that its ANOH gas plant achieved mechanical completion on 29th December 2023.

“Our government partner recently announced the tunnelling operations on the Niger River crossing portion of the OB3 pipeline have begun”.

For 2024, Seplat sets production guidance of 44-52 kboepd assuming the availability of TNP from 3Q 2024, and assumes ANOH contribution in line with guidance. It set an initial 2024 capex guidance of $170-200 million.

Commenting on the result, Roger Brown, Chief Executive Officer, said, “Ability to deliver production growth, fortify our balance sheet and reward shareholders despite facing some unexpected challenges during the year.

“Operational performance was strong, production increased 8% over 2022 and we recorded the lowest level of reconciliation losses seen in recent years, a testament to the improving security efforts on the Niger Delta.

He explained that drilling yielded positive results.

“I’m pleased to report strong 2P reserves growth, up 9% on prior year estimates. Our revenue exceeded $1 billion, and while costs increased, our proactive approach meant we generated more than $260 million of free cash flow in the year, allowing us to continue rewarding our shareholders and further reduce net debt.

“Our strong financial position, excellent operational performance and robust outlook means that we are delighted to declare a special dividend again this year, lifting the total dividend for the year to 15 cents.

“In 2024, we look forward to several key growth events. We are moving forward on both the Sibiri and Abiala developments on OML40. Clear progress is also being made on the important ANOH gas project, with first gas expected in 3Q 2024. Finally, we have high confidence that we will conclude the transformational acquisition of MPNU this year”. #Seplat Energy Grows Profit by 83% to N81.33bn

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