REG-Cadogan Energy Solutions Plc: Half Yearly Report for the Six Months ended 30 June 2025
08/09/2025 07:02
CADOGAN ENERGY SOLUTIONS PLC
Half Yearly Report for the Six Months ended 30 June 2025
(Unaudited and unreviewed)
Highlights
Cadogan Energy Solutions plc ("Cadogan" or the "Company"), an independent
energy company, listed on the Transition Market of the London Stock Exchange,
aiming to be a diversified energy company with investments, operations and
services along the energy value chain, is pleased to announce its unaudited
results for the six months ended 30 June 2025.
* With the ongoing war, the first six months of 2025 continued to be
difficult, for Ukraine in general, and its energy sector in particular, due to
continuous bombing, major disruptions in energy supplies, extensive damage to
critical infrastructure, and persistent operational obstacles.
* H1 2025 has been another semester without LTI and TRI. All employees and
assets have been secured.
* In H1 2025, the average production was 326 bpd in (370 bpd in H1 2024), a
12% decrease vs H1 2024.
* The gas-to-power project, utilizing the non-commercial associated gas from
Blazhiv field for generating electricity is in progress. It is expected to be
operational in Q4 2025. The project experienced an extended timeline due to
unexpected administrative delays for grid connection and permitting.
* The new power generation projects in Ukraine are also in progress. The
portfolio, totalling 12.3 MW of installed capacity, is scheduled to become
operational in Q4 2025.
* The ISO 14001 and ISO 45001 certifications have been revalidated for a new
term.
* The production revenues decreased by 38 % versus the same period in 2024,
mainly due to a 32% decrease in the average realised oil price and a 12%
decrease of the production volumes.
* In January 2025, Cadogan received 10 million euros as provided in the
Settlement Agreement signed with Proger in December 2024. Subsequently,
Cadogan exited from the Loan Agreement signed in February 2019, ended all the
litigations procedures and dissolved the pledge over the corresponding shares
in Proger Ingegneria.
* The cash position at the period end was $20.1 million (30 June 2024: $15.1
million). This level of cash is sufficient to sustain on-going operations and
business development initiatives.
* In Italy, Exploenergy was granted, in May 2025, the gas exploration licence
for the Corzano project located in the Lombardia region. Exploenergy is
expecting the granting, in Q4 2025, of the one for the Reno Centese project
located in the Emilia Romagna region.
Key performance indicators
During H1 2025, the Group has monitored its performance in conducting its
business with reference to a number of key performance indicators (`KPIs'):
* to secure its staff and operations.
* to maintain stable oil production measured on the barrels of oil produced
per day (`bpd');
* to contain administrative expenses,
* to increase the Group's basic earnings per share,
* to maintain no lost time incident,
* to diversify in the energy sector,
* to geographically diversify the portfolio
The Group's performance during the first six months of 2025, measured against
these targets, is set out in the table below, together with the prior year
performance data. No changes have been made to the sources of data or
calculations used in the period/year. The positive trend in the HSE
performances continues with zero incidents.
Unit 30 June 2025 30 June 2024 31 December 2024
Average production (working interest basis) (a) Boepd 326 370 353
Administrative expenses $million 1.8 1.5 (3.5)
Basic profit/(loss) per share (b) Cent 0.4 0.1 (2.5)
Lost time incident (c) Incidents - - -
Diversification in energy sector New activities Power generation under construction - -
Geographical diversification New assets Gas Exploration licence in Italy - -
1. Average production is calculated as the average daily production during the
period/year
2. Basic profit/loss per ordinary share is calculated by dividing the net
profit/loss for the year attributable to equity holders of the parent company
by the weighted average number of ordinary shares during the period
3. Lost time incident relates to injuries where an employee/contractor is
injured and has time off work (IOGP classification)
Enquiries:
Cadogan Energy Solutions Plc
Fady Khallouf Chief Executive Officer f.khallouf@cadogan-es.com
Ben Harber Company Secretary +44 (0) 207 264 4366
Operations Review
Introduction
The first half of 2025 remained extremely challenging for Ukraine, as Russia
continued its systematic attacks on industrial and energy infrastructure.
Repeated missile strikes on oil refineries and power generation plants
weakened further the country's energy system. At the same time, the
destruction of Ukraine's refining capacity removed a major domestic outlet for
crude oil. With fewer refineries able to process volumes into higher-value
products, the local market became oversupplied with crude, which, together
with global oil price instability, drove down domestic oil prices and directly
reduced revenue flows for the Company.
Despite these severe external pressures, the Group maintained oil production
at the Blazhiv field. The production was sustained without unplanned
shutdowns.
Throughout this period, Cadogan's employees in Ukraine continued working in a
combined remote/office mode, with all staff remaining safe. The Group's local
operating companies remain classified as enterprises of critical importance
for the functioning of Ukraine's economy, underscoring the strategic role we
play even in wartime conditions. In this context, the Group has remained
focused on safe operations, strict cost control, cash preservation, and
selectively pursuing new growth opportunities.
Operations
E&P activity remained focused on maintaining and securing its activities for
the new term and safely and efficiently producing from the existing wells
within the Blazhiv oil field. In H1 2025, the average gross production rated
at 326 bpd, reflecting a 12% decline compared to 370 bpd in H1 2024.
Operational excellence of the Group has been confirmed again by zero LTI or
TRI1, with a total over 1,809,000 manhours since the last incident, and the
revalidation of ISO 14001 & 45001 certifications for a new term.
CO2 emissions level in H1 2025 remained stable. The Intensity ratio was 147,17
tons of CO2,e/boe produced broadly in line with the one for the same reporting
period of the last year. Looking ahead, the commissioning of the gas-to-power
plant is expected to deliver a meaningful reduction in annual gas emissions,
supporting both operational efficiency and the Company's environmental
objectives.
The gas-to-power project planning has suffered from unexpected delays in
administrative authorisations for connection to the grid and permitting.
The new power generation projects were launched across several locations in
Ukraine. All power generator units have now been delivered by the supplier.
The construction works are ongoing on the first site and will soon start on
two other sites. With a total installed capacity of 12.3 MW planned to come
operational in Q4 2025, these initiatives represent a significant milestone in
reinforcing the Company's commitment to diversify and expand in new activities
in the energy sector.
In Italy, Exploenergy was granted in May 2025 the gas exploration licence for
the Corzano project. Exploenergy is expecting the granting, in Q4 2025, of the
one for the Reno Centese project.
Trading
In the first half of 2025, the Trading segment executed the disposal of
remaining natural gas inventories at the peak of spot market prices. Cadogan
continues to monitor the gas markets in Europe and Ukraine.
Financial position
Cash at 30 June 2025 was $20.1 million ($15.1 million at 30 June 2024). The
Group continuously monitors its exposure to currency risk. It maintains a
portfolio of cash mainly in US Dollars ("USD"), EURO and Sterling ("GBP") held
primarily in the UK.
The Directors believe that the capital available at the date of this report is
sufficient for the Group to continue its operations for the foreseeable
future.
In H1 2025, the Group held working interests in an oil production licence in
the West of Ukraine, located in the prolific Carpathian basin, close to the
Ukrainian oil and gas distribution infrastructure. It is operated by the
Group.
Summary of the Group's licences (as of 30 June 2025)
Working interest (%) Licence Expiry Licence type
100 Blazhiv November 2039 Production
Below we provide an update to the full Operations Review contained in the 2024
Annual Report published on 28 April 2025.
Blazhiv licence
Throughout the reporting period, the Company remained focused on the safe and
efficient operation of its existing wells in the Blazhiv licence area. Average
gross production reached 326 bpd, compared with 370 bpd in H1 2024. The
decline includes a planned program of hydrodynamic surveys - designed to
assess reservoir pressure, fluid flow dynamics, and long-term production
potential - as well as scheduled equipment maintenance. These proactive
measures are aimed at optimizing recovery, extending well life, and ensuring
continued operational reliability.
The gas-to-power project at Blazhiv field, together with the related gas
capture infrastructure, has made less progress than expected during H1 2025.
This is due to additional delays for unexpected procedural requirements for
securing a grid connection and the related permitting. The project is expected
to be operational in Q4 2025.
Service Company activities
In H1 2025, Astro Service LLC, focused again its activities on serving
intra-group operational needs in wells' re-entry operations, wells' survey as
well as field on-site activities. Production and service activities will be
presented solely as Exploration and Production segment result.
Financial Review
Overview
Income statement
In H1 2025, revenues decreased to $3.1 million (H1 2024: $5 million) due to
the decrease of the realised price by 32% and the decrease in the produced
volumes of oil by 12%.
Trading business: In the first half of 2025, the Trading segment executed the
disposal of 0.76 million m3 natural gas at the peak of spot market prices and
contributed on the Group's revenue and operating cash flow for $0.3 million.
The cost of sales of the production segment consists of $1.1 million of
production royalties ($1.5 million), $0.9 million of operating costs ($0.7
million), $0.3 million of depreciation and depletion of producing wells ($0.4
million), and $0.1 million of direct staff costs for production ($0.07
million).
Half year gross profit from production activities decreased to 0.7 million (30
June 2024: increased to $2.3 million), driven by decrease in production and
oil prices.
Other administrative expenses were kept under control at $1.8 million (30 June
2024: $1.5 million). They comprise other staff costs, professional fees and
expenses, Directors' remuneration and depreciation charges on non-producing
property.
Balance sheet
At 30 June 2025, the cash position of $20.1 million (30 June 2024: $15.1
million) increased compared to the $14.3 million as at 31 December 2024.
The Property, Plant and Equipment ("PP&E") balance of $9.8 million at 30 June
2025 (30 June 2024: $5.2 million, 31 December 2024: $5.4 million) includes the
development and production assets on the Blazhyvska licence, construction in
progress on power generation activities and other PP&E of the Group.
The balance of prepayments for non-current assets amounted to $1.4 million as
at 30 June 2025 and primarily relates to advance payments for electricity
generators to be installed under new power generation projects.
Trade and other receivables of $0.4 million (30 June 2024: $0.4 million, 31
December 2024: $0.3 million) includes recoverable VAT of $8 thousand (30 June
2024: $5 million, 31 December 2024: $0.05 million), $0.38 million of other
receivables and prepayments (30 June 2024: $0.35 million, 31 December 2024:
$0.05 million).
The $1.3 million of trade and other payables as of 30 June 2025 (30 June 2024:
$1.5 million, 31 December 2024: $1.6 million) represent $0.9 million (30 June
2024: $0.8 million, 31 December 2024: $0.4 million) of other creditors and
$0.4 million of accruals (30 June 2024: $0.7 million, 31 December 2024: $1.2
million).
Cash flow statement
The Consolidated Cash Flow Statement shows negative cash-flow from operating
activities of $0.5 million (30 June 2024: positive $1 million, 31 December
2024: positive $0.7 million). Cashflow, before movements in working capital,
shows an outflow of $0.7 million (30 June 2024: inflow $1.2 million, 31
December 2024: inflow $1.4 million).
Group capital expenditure of $6.2 million represents investments in
gas-to-power project and new power generation projects.
Commitments
All material changes in the commitments and contingencies reported as at 31
December 2024 (refer to page 89 of the Annual Report).
Treasury
The Group continually monitors its exposure to currency risk. It maintains a
portfolio of cash mainly in US dollars ("USD"), Great Britain Pound ("GBP")
and Euro held primarily in the UK. Production revenues from the sale of
hydrocarbons are received in the local currency in Ukraine, however, the
hydrocarbon prices are linked to the USD denominated gas and oil prices. The
martial law in Ukraine significantly limits the transfer of cash outside of
Ukraine.
The cash in Ukraine is held in the local currency (Hryvnia) and placed to
deposits in subsidiaries of reputable international banks.
Going concern
The Directors have a reasonable expectation that the Company and the Group
have adequate resources to continue in operational existence for the
foreseeable future. Accordingly, they continue to adopt the going concern
basis in preparing the Interim Financial Statements. For further details,
refer to the detailed presentation of the assumptions outlined in note 2(a) of
the Interim Financial Statements.
Risks and uncertainties
There are a number of potential risks and uncertainties inherent in the oil
and gas sector which could have a material impact on the long-term performance
of the Group and which could cause the actual results to differ materially
from expected and historical results. The Company has taken reasonable steps
to mitigate these where possible. Full details are disclosed on pages 9 to 12
of the 2024 Annual Financial Report. There have been no changes to the risk
profile during the first half of the year. The risks and uncertainties are
summarised below.
War risks
* Missile attacks
* Occupation of territories
* Forced evacuations
* Cyber attacks
Operational risks
* Health, safety, and environment
* Climate change
* Drilling and work-over operations
* Production and maintenance
Subsurface risks
Financial risks
* Changes in economic environment
* Counterparty
* Commodity price
Country risk
* Regulatory and licence issues
* Emerging market
Other risks
* Risk of losing key staff members
* Risk of entry into new countries
* Risk of delays in projects related to dialogue with local communities
Director's Responsibility Statement
We confirm that to the best of our knowledge:
(a) the Interim Financial Statements have been prepared in accordance with
the UK-adopted IAS 34 `Interim Financial Reporting';
(b) the interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first six
months and description of principal risks and uncertainties for the remaining
six months of the year);
(c) the interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related parties' transactions and
changes therein); and
(d) the condensed set of financial statements, which has been prepared in
accordance with the applicable set of accounting standards, gives a true and
fair view of the assets, liabilities, financial position and profit or loss of
the issuer, or the undertakings included in the consolidation as a whole as
required by DTR 4.2.4R.
This Half Yearly Report consisting of pages 1 to 21 has been approved by the
Board and signed on its behalf by:
Fady Khallouf
Chief Executive Officer
5 September 2025
Consolidated Income Statement
Six months ended 30 June 2025
Six months ended 30 June Year ended 31 December
2025 $'000 2024 $'000 2024 $'000
Notes (Unaudited) (Unaudited) (Audited)
CONTINUING OPERATIONS
Revenue 3 3,094 4,952 9,152
Cost of sales 3 (2,395) (2,671) (5,047)
Gross profit 699 2,281 4,105
Administrative expenses (1,823) (1,508) (3,522)
Reversal of impairment of other assets 61 - 39
Adjustments to end of concession obligations for E&E assets - - (6)
Impairment of gas and oil assets (12) (10) -
Impairment of other assets - - (39)
Net foreign exchange gains/(losses) 1,527 (542) (1,123)
Other operating income/(losses), net 69 (1) (19)
Operating profit /(loss) 521 256 (565)
Loss on Proger loan, net - - (5,657)
Finance income 4 386 767 759
Profit/(loss) before tax 907 1,023 (5,463)
Tax (expense)/benefit 13 - (805) (769)
Profit/(loss) for the period/year 907 219 (6,232)
Attributable to:
Owners of the Company 5 907 219 (6,232)
Non-controlling interest - - -
907 219 (6,232)
Profit/(loss) per Ordinary share Cents Cents Cents
Basic and diluted 5 0.4 0.1 (2.6)
Consolidated Statement of Comprehensive Income
Six months ended 30 June 2025
Six months ended 30 June Year ended 31 December
2025 $'000 2024 $'000 2024 $'000
(Unaudited) (Unaudited) (Audited)
Profit / (loss) for the period/year 907 219 (6,232)
Other comprehensive profit/(loss)
Items that may be reclassified subsequently to profit or loss
Unrealised currency translation differences 157 (444) (1,141)
Other comprehensive profit /(loss) 157 (444) (1,141)
Total comprehensive profit / (loss) for the period/year 1,064 (225) (7,373)
Attributable to:
Owners of the Company 1,064 (225) (7,373)
Non-controlling interest - - -
1,064 (225) (7,373)
Consolidated Statement of Financial Position
Six months ended 30 June 2025
Six months ended 30 June Year ended 31 December
2025 $'000 2024 $'000 2024 $'000
Notes (Unaudited) (Unaudited) (Audited)
ASSETS
Non-current assets
Property, plant and equipment 6 9,767 5,231 5,329
Prepayments for non-current assets 6 1,436 - -
Right-of-use assets 125 191 165
11,328 5,422 5,494
Current assets
Inventories 7 287 365 515
Trade and other receivables 8 386 355 354
Loan provided 11 - 16,959 10,388
Cash and cash equivalents 20,090 15,141 14,381
20,763 32,820 25,638
Total assets 32,091 38,242 31,132
LIABILITIES
Non-current liabilities
Deferred tax liabilities - (101) -
Long-term lease liability (40) (112) (75)
Provisions (101) (117) (110)
(141) (330) (185)
Current liabilities
Trade and other payables 9 (1,313) (1,487) (1,652)
Short-term lease liability (97) (85) (98)
Current provisions (147) (124) (129)
(1,557) (1,696) (1,879)
Total liabilities (1,698) (2,026) (2,064)
Net assets 30,393 36,216 29,068
EQUITY
Share capital 12 14,093 13,832 13,832
Share premium 514 514 514
Retained earnings 180,478 186,022 179,571
Cumulative translation reserves (166,281) (165,741) (166,438)
Other reserves 1,589 1,589 1,589
Equity attributable to equity holders of the parent 30,393 36,216
29,068
Non-controlling interest - - -
Total equity 30,393 36,216 29,068
Consolidated Statement of Cash Flows Six months ended 30 June 2025 Six months ended 30 June Year ended 31 December
2025 $'000 2024 $'000 2024 $'000
(Unaudited) (Unaudited) (Audited)
Operating profit/(loss) 521 256 (565)
Adjustments for:
Depreciation of property, plant and equipment 359 449 813
Changes in provision of oil and gas assets 12 - 6
Impairment of inventories - - 28
Reversal of impairment of VAT recoverable (61) (36) (39)
Impairment of oil and gas assets - 10 -
Impairment of receivables - - 11
Effect of foreign exchange rate changes (1,527) 542 1,122
Operating cash flows before movements in working capital (696) 1,221 1,376
Increase /(Decrease) in inventories 234 (3) (219)
Increase /(Decrease) in receivables 45 121 (663)
(Decrease)/Increase in payables and provisions (75) (134) 644
Cash from operations (492) 1,205 1,138
Income taxes paid - (228) (447)
Net cash (outflow)/inflow from operating activities (492) 977 691
Investing activities
Purchases of property, plant and equipment (6,152) (334) (1,048)
Interest received 397 396 800
Net cash used in investing activities (5,755) 62 (248)
Financing activities
Repayment of lease liability - - (118)
Repayment of loan 10,487 - -
Net cash from financing activities 10,487 - (118)
Net increase (decrease) in cash and cash equivalents 4,240 1,039 326
Effect of foreign exchange rate changes 1,470 (53) (100)
Cash and cash equivalents at beginning of period/year 14,381 14,155 14,155
Cash and cash equivalents at end of period/year 20,090 15,141 14,381
Consolidated Statement of Changes in Equity
Six months ended 30 June 2025
Share capital Share premium account Retained earnings Cumulative translation reserves Other reserves Equity attributable to owners of the Company Non-controlling interest Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
As at 1 January 2024 13,832 514 185,803
(165,297) 1,589 36,441 - 36,441
Net income for the period - - 219 - - 219 - 219
Other comprehensive loss - - - (444) - (444) - (444)
Total comprehensive income/loss for the year - - 219 (444) - (225) - (225)
As at 30 June 2024 13,832 514 186,022 (165,741) 1,589 36,216 - 36,216
Net loss for the period - - (6,451) - (6,451) - (6,451)
Other comprehensive loss - - - (697) - (697) - (697)
Total comprehensive loss for the year - - (6,451) (697) - (7,148) - (7,148)
As at 31 December 2024 13,832 514 179,571 (166,438) 1,589 29,068 - 29,068
Net profit for the period - - 907 - - 907 - 907
Other comprehensive income - - - 157 - 157 - 157
Total comprehensive income for the year - - 907 157 - 1,064 - 1,064
Issue of ordinary shares 261 - - - - 261 - 261
As at 30 June 2025 14,093 514 180,748 (166,281) 1,589 30,393 - 30,393
Notes to the Condensed Financial Statements
Six months ended 30 June 2025
1. General information
Cadogan Energy Solutions plc (the `Company', together with its subsidiaries
the `Group'), is incorporated in England and Wales under the Companies Act.
The address of the registered office is Floor 2, 8 Bishopsgate, London EC2N
4BQ. The nature of the Group's operations and its principal activities are set
out in the Operations Review on page 7 and the Financial Review on page 8.
This Half Yearly Report has not been audited or reviewed in accordance with
the Auditing Practices Board guidance on `Review of Interim Financial
Information'.
A copy of this Half Yearly Report has been published and may be found on the
Company's website at https://www.cadoganenergysolutions.com.
1. Basis of preparation
The annual financial statements of the Group are prepared in accordance with
international accounting standards in conformity with the requirements of the
Companies Act 2006 and in accordance with international financial reporting
standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in
the European Union. On 31 December 2020, IFRS as adopted by the European Union
at that date was brought into UK law and became UK-adopted international
accounting standards, with future changes being subject to endorsement by the
UK Endorsement Board. The Group transitioned to UK-adopted international
accounting standards in its consolidated financial statements on 1 January
2021. There was no impact or changes in accounting policies from the
transition. These Condensed Financial Statements have been prepared in
accordance with the UK-adopted IAS 34 Interim Financial Reporting.
The same accounting policies and methods of computation are followed in the
condensed financial statements as were followed in the most recent annual
financial statements of the Group except as noted, which were included in the
Annual Report issued on 25 April 2025.
The Group has not early adopted any amendment, standard or interpretation that
has been issued but is not yet effective. It is expected that where
applicable, these standards and amendments will be adopted on each respective
effective date.
This consolidated interim financial information does not constitute accounts
within the meaning of section 434 and of the Companies Act 2006. Statutory
accounts for the year ended 31 December 2024 were approved by the Board of
Directors on 25 April 2025 and delivered to the Registrar of Companies.
(a) Going concern
The Directors have continued to use the going concern basis in preparing these
condensed financial statements. The Group's business activities, together with
the factors likely to affect future development, performance and position are
set out in the Operations Review. The financial position of the Group, its
cash flow and liquidity position are described in the Financial Review.
The Group's cash balance at 30 June 2025 was $20.1 million (31 December 2024:
$15.1 million).
The Directors' have carried out a robust assessment of the principal risks
facing the Group.
The Group's forecasts and projections, taking into account reasonably possible
changes in trading activities, operational performance, flow rates for
commercial production and the price of hydrocarbons sold to Ukrainian
customers, show that there are reasonable expectations that the Group will be
able to operate on funds currently held and those generated internally, for
the foreseeable future.
Notwithstanding the Group's current financial performance and position, the
Board are cognisant of the actual impacts of the war situation in Ukraine. The
Board has considered possible reverse stress case scenarios for the impact on
the Group's operations, financial position and forecasts. Whilst the
potential future impacts of the invasion of Ukraine by Russia are unknown, the
Board has considered operational disruption that may be caused by the factors
such as a) restrictions applied by governments, illness amongst our workforce
and disruption to supply chain and sales channels; b) market volatility in
respect of commodity prices associated with military and geopolitical factors.
In addition to sensitivities that reflect future expectations regarding
country, commodity price and currency risks that the Group may encounter
reverse stress tests have been run to reflect possible negative effects of war
in Ukraine. The Group's forecasts demonstrate that owing to its cash resources
the Group is able to meet its operating cash flow requirements and commitments
whilst maintaining significant liquidity for a period of at least the next 12
months allowing for sustained reductions in commodity prices and extended and
severe disruption to operations should such a scenario occur.
After making enquiries and considering the uncertainties described above, the
Directors have a reasonable expectation that the Company and the Group have
adequate resources to continue in operational existence for the foreseeable
future and consider the going concern basis of accounting to be appropriate
and, thus, they continue to adopt the going concern basis of accounting in
preparing the annual financial statements.
(b) Foreign currencies
The individual financial statements of each Group company are presented in the
currency of the primary economic environment in which it operates (its
functional currency). The functional currency of the Company is US dollar. For
the purpose of the consolidated financial statements, the results and
financial position of each Group company are expressed in US dollars, which is
the presentation currency for the consolidated financial statements.
The relevant exchange rates used were as follows:
1 £ = xUS$ Six months ended 30 June Year ended 31 Dec 2024
2025 2024
Closing rate 1.37152 1.26473 1.25369
Average rate 1.2978 1.2651 1.2782
1 US$ = xUAH Six months ended 30 June Year ended 31 Dec 2024
2025 2024
Closing rate 41.9276 40.7683 42.3997
Average rate 41.8867 39.2932 40.4528
1 Euro = xUS$ Six months ended 30 June Year ended
2025 2024 31 Dec 2024
Closing rate 1.17438 1.07177 1.0388
Average rate 1.0937 1.0812 1.0821
(c) Dividend
The Directors do not recommend the payment of a dividend for the period (30
June 2025: $nil; 31 December 2024: $nil).
(d) Critical accounting judgments and estimates
Impairment indicator assessment for E&E assets
Where there are indications of impairment, the E&E assets concerned are tested
for impairment. Where the E&E assets concerned fall within the scope of an
established full cost pool, which are not larger than an operating segment,
they are tested for impairment together with all development and production
assets associated with that cost pool, as a single cash generating unit.
The aggregate carrying value of the relevant assets is compared against the
expected recoverable amount of the pool, generally by reference to the present
value of the future net cash flows expected to be derived from production of
commercial reserves from that pool. Where the assets fall into an area that
does not have an established pool or if there are no producing assets to cover
the unsuccessful exploration and evaluation costs, those assets would fail the
impairment test and be written off to the income statement in full.
Impairment losses are recognized in the income statement and are separately
disclosed.
Impairment of PP&E
Management assesses the development and production assets for impairment
indicators and performs an impairment test if indicators of impairment are
identified. Management performed an impairment assessment using a value in use
discounted cash flow model which required estimates including forecast oil
prices, reserves and production, costs and discount rates.
Recoverability and measurement of VAT
Judgment is required in assessing the recoverability of VAT assets and the
extent to which historical impairment provisions remain appropriate,
particularly noting the recent recoveries against historically impaired VAT.
In forming this assessment, the Group consider the nature and age of the VAT,
the likelihood of eligible future supplies to VAT, the pattern of recoveries
and risks and uncertainties associated with the operating environment.
1. Segment information
Segment information is presented on the basis of management's perspective and
relates to the parts of the Group that are defined as operating segments.
Operating segments are identified on the basis of internal assessment provided
to the Group's chief operating decision maker ("CODM"). The Group has
identified its executive management team as its CODM and the internal
assessment used by the top management team to oversee operations and make
decisions on allocating resources serve as the basis of information presented.
Segment information is analysed on the basis of the type of activity, products
sold, or services provided. The majority of the Group's operations are located
within Ukraine. Segment information is analysed on the basis of the types of
goods supplied by the Group's operating divisions.
The Group's reportable segments under IFRS 8 are therefore as follows:
Exploration and Production
* E&P activities on the production licences for natural gas, oil and
condensate
Trading
* Import of natural gas from European countries
* Local purchase and sales of natural gas operations with physical delivery of
natural gas
The accounting policies of the reportable segments are the same as the Group's
accounting policies. Sales between segments are carried out at market prices.
The segment result represents profit under IFRS before unallocated corporate
expenses. Unallocated corporate expenses include management and Board
remuneration and expenses incurred in respect of the maintenance of Kiev
office premises. This is the measure reported to the CODM for the purposes of
resource allocation and assessment of segment performance.
The Group does not present information on segment assets and liabilities as
the CODM does not review such information for decision-making purposes.
As at 30 June 2025 and for the six months then ended the Group's segmental
information was as follows:
Exploration and Production Trading Consolidated
$'000 $'000 $'000
Sales of hydrocarbons 2,770 317 3,087
Other revenue 7 - 7
Total revenue 2,777 317 3,094
Other cost of sales (2,146) (248) (2,395)
Other administrative expenses (245) (21) (266)
Impairment of oil & gas (12) - (12)
Other operating income 130 - 130
Finance income, net 242 - 242
Segment results 746 48 793
Unallocated other administrative expenses - - (1,557)
Other finance income, net 144
Net foreign exchange gains - - 1,527
Profit before tax - - 907
As at 30 June 2024 and for the six months then ended the Group's segmental
information was as follows:
Exploration and Production Trading Consolidated
$'000 $'000 $'000
Sales of hydrocarbons 4,933 - 4,933
Other revenue 19 - 19
Total revenue 4,952 - 4,952
Other cost of sales (2,670) (1) (2,671)
Other administrative expenses (196) (25) (221)
Impairment of oil & gas (10) - (10)
Other operating income 35 - 35
Finance income, net 226 - 226
Segment results 2,337 (26) 2,311
Unallocated other administrative expenses - - (1,287)
Other income, net - - 541
Net foreign exchange loss - - (542)
Profit before tax - - 1,023
1. Finance income/(costs), net
Six months ended 30 June Year ended 31 December
2025 2024 2024
$'000 $'000 $'000
Interest expense on lease (8) (11) (22)
Total interest expenses on financial liabilities (8) (11) (22)
Interest income on cash deposit 397 396 799
Total interest income on financial assets 397 396 799
Interest on loan 1 381 (5,657)
Unwinding of discount on decommissioning provision (4) 1 (18)
Total 386 767 (4,876)
1. Profit/(loss) per ordinary share
Profit/(loss) per ordinary share is calculated by dividing the net
profit/(loss) for the period/year attributable to Ordinary equity holders of
the parent by the weighted average number of Ordinary shares outstanding
during the period/year. The calculation of the basic profit/(loss) per share
is based on the following data:
Six months ended 30 June Year ended 31 December
Profit /(Loss) attributable to owners of the Company 2025 $'000 2024 $'000 2024 $'000
Profit /(loss) for the purposes of basic profit/(loss) per share being net profit/(loss) attributable to owners of the Company 907 219 (6,232)
Number Number Number
Number of shares `000 `000 `000
Weighted average number of Ordinary shares for the purposes of basic profit/(loss) per share 251,128 244,128 244,128
Cent Cent Cent
Profit/(loss) per Ordinary share
Basic 0.4 0.1 (2.55)
1. Proved properties
As of 30 June 2025, the development and production assets balance which forms
part of PP&E has decreased in comparison to 31 December 2024 by 5%, mainly due
to depletion charge for the period.
Construction in progress in the amount of $5.3 million represents new assets
acquired by the Group for its emerging business segment, the gas-to-power
project and electricity generation project. As at 30 June 2025, the assets'
value includes an electricity generator delivered in December 2024, which is
expected for starting operations in Q4 2025; and several Gas Engine units,
which have been already delivered in Ukraine at the end of June, and which are
expected for starting operations in Q4 2025.
Prepayments for non-current assets represent 1.3 million euros of payments for
purchasing gas engine units.
1. Inventories
As at 30 June 2025, inventories are decreased to $287 thousand mainly due to
sold natural gas to third parties (30 June 2024: $365 thousand, 31 December
2024: $515 thousand).
The impairment provision as at 30 June 2025 of $1 million is held to reduce
the carrying value of the inventories to net realisable value. No additional
provision on inventories has been recognised for the first half 2025.
1. Trade and other receivables
Six months ended 30 June Year ended 31 December
2025 $'000 2024 $'000 2024 $'000
VAT recoverable 749 834 862
Impairment provision for VAT (741) (829) (793)
Prepayments 275 326 256
Trade receivables 62 29 32
Other receivables 79 30 35
Impairment provision for bad debts (38) (35) (38)
386 355 354
VAT recoverable asset was realized through natural gas and crude oil sales
during the first half of 2025. The Directors consider that the carrying amount
of the other receivables approximates their fair value. Management expects to
realise VAT recoverable through the activities of the business segments.
1. Trade and other payables
The $1.3 million of trade and other payables as at 30 June 2024 (30 June 2024:
$1.5 million, 31 December 2024: $1.7 million) represent $0.87 million (30 June
2024: $0.8 million, 31 December 2024: $0.7 million) of other creditors and
$0.44 million of accruals (30 June 2024: $0.7 million, 31 December 2024: $0.8
million).
1. Commitments and contingencies
As of 30 June 2025, the Group had capital commitments related to the
acquisition and commissioning of gas engine units under contracts. The total
amount of outstanding capital expenditure under these contracts is expected to
be settled by the end of Q3 2025. The Group anticipates that the assets will
be brought into use in Q4 2025.
There have been no other significant changes to the commitments and
contingencies reported on page 89 of the Annual Report.
1. Loan provided
In February 2019, Cadogan used part of its cash (Euro 13.385 million) to enter
into a 2-year Loan Agreement with Proger Managers & Partners, with an option
to convert it into a direct 33% equity interest in Proger Ingegneria,
equivalent to an indirect 25 % equity interest in Proger. According to IFRS,
the instrument has to be represented in our balance sheet at fair value.
In February 2021, Cadogan notified PMP that according to the Loan Agreement,
the Maturity Date occurred on 25 February 2021. As the Call Option was not
exercised, PMP must fulfil the payment of EUR 14,857,350, being the
reimbursement of the Loan in terms of principal and the accumulated interest.
PMP was in default since 25 February 2021. In case of default payment, the
terms of the agreement provide for the application of an increased interest
rate (7.5%) on the amount of the debt.
Since the Call Option was not exercised before the Maturity Date and the asset
is held within a business model whose objective is to hold assets in order to
collect contractual cash flows, the Loan provided was reclassified from
`Financial assets at fair value through profit and loss' to `Financial assets
at amortised cost'.
Financial assets at amortised cost
$'000
As at 1 January 2024 17,074
Interest 751
Change in provision (370)
Exchange differences (496)
As at 30 June 2024 16,959
Interest 764
Change in provision (6,802)
Exchange differences (533)
As at 1 January 2025 10,388
Interest 116
Change in provision (115)
Loan repayment (10,487)
Exchange differences 98
As at 30 June 2025 -
In December 2024, Cadogan and Proger entered into a Settlement Agreement to
end their controversy on the Loan Agreement. In January 2025, Cadogan received
10 million euros as provided in the Settlement Agreement. Subsequently,
Cadogan exited from the Loan Agreement, ended all the litigations procedures
and dissolved the pledge over the corresponding shares in Proger Ingegneria.
1. Share capital
Authorized and issued equity share capital
30/06/2025 31/12/2024
Number `000' $'000 Number `000' $'000
Authorised Ordinary shares of £0.03 each 1,000,000 57,713 1,000,000 57,713
Issued Ordinary shares of £0.03 each 251,128 14,093 244,128 13,832
Authorised but unissued share capital of £30 million has been translated into
US dollars at the historic exchange rate of the issued share capital. The
Company has one class of Ordinary shares, which carry no right to fixed
income.
Issued equity share capital
Ordinary shares of £0.03
At 31 December 2023 244,128,487
Issued during year -
At 31 December 2024 244,128,487
Issued during first-half year 7 000 000
At 30 June 2025 251,128,487
1. Tax
Six months ended 30 June Year ended 31-Dec
2025 2024 2024
$'000 $'000 $'000
Current tax - 333 434
Deferred tax - 471 335
- 805 769
No current and deferred taxes were accrued on the profits of the oil
extraction company LLC Usenco-Nadra.
1. Events subsequent to the reporting date
In July 2025, the Group continued to make payments under the generators
purchase agreement. As of the date of this report, the remaining contractual
liabilities are expected to be fully settled by the end of October 2025. The
commissioning of the power generation projects are scheduled to take place
before the end of the current financial year.
Astroinvest Energy LLC is in discussion with local banks in Ukraine to enter
into a Euro 4.5 million Loan Facility agreement.
In July 2025, Exploenergy was informed of the approval by the Emilia Romagna
region of the Reno Centese project. Exploenergy is expecting the granting, in
Q4 2025, of the gas exploration licence for this project.
Cautionary Statement
The business review and certain other sections of this Half Yearly Report
contain forward looking statements that have been made by the Directors in
good faith based on the information available to them up to the time of their
approval of this report. However, they should be treated with caution due to
inherent uncertainties, including both economic and business risk factors,
underlying any such forward-looking information and no statement should be
construed as a profit forecast.
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