REG - Serinus Energy PLC - H1 2024 Financial Results
12/08/2024 07:00
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RNS Number : 9628Z Serinus Energy PLC 12 August 2024
12 August 2024
Press Release
H1 2024 Interim Financial Results
Jersey, Channel Islands, 12 August 2024 -- Serinus Energy plc ("Serinus" or
the "Company" or the "Group") (AIM:SENX, WSE:SEN) is pleased to announce its
Interim Financial Results for the six months ended 30 June 2024.
H1 2024 Highlights
Financial
· Revenue for the six months ended 30 June 2024 was $8.8 million
(30 June 2023 - $8.9 million)
· Funds from operations for the six months ended 30 June 2024
were $1.3 million (30 June 2023 - $0.4 million)
· EBITDA for the six months ended 30 June 2024 was $1.6 million
(30 June 2023 - $0.5 million)
· Gross profit for the six months ended 30 June 2024 was $1.7
million (30 June 2023 - $0.8 million)
· The Company realised a net price of $80.13/boe for the six
months ended 30 June 2024 comprising:
o Realised oil price - $84.07/bbl
o Realised natural gas price - $11.06/Mcf
· The Group's operating netback increased for the six months
ended 30 June 2024 and was $32.43/boe (30 June 2023 - $31.18/boe), in line
with lower production volumes in Romania and significantly lower realised gas
prices offset by stable production in Tunisia and higher crude oil price,
comprising:
o Romania operating netback - ($54.32)/boe (30 June 2023 - $12.53/boe)
o Tunisia operating netback - $39.71/boe (30 June 2023 - $36.47/boe)
· Capital expenditures of $0.2 million (30 June 2023 - $5.0
million), comprising:
o Romania - $nil million
o Tunisia - $0.2 million
· Working capital deficit was $4.2 million (31 December 2023 -
deficit of $5.6 million)
Operational
· Production in Chouech Es Saida continues to perform well,
benefiting from the artificial lift programme
· Long lead items for the Sabria W-1 sidetrack have been ordered
and are on schedule. Discussions are on-going with Compagnie Tunisienne de
Forage (CTF), the state rig company, regarding availability of rigs to perform
this sidetrack
· The Group completed lifting 62,930 bbl of Tunisian crude oil in
the second half of March 2024 at an average price of $82.76/bbl with the cash
proceeds of $3.2 million received in April 2024 (net of $2.0 million in
monthly prepayments previously received)
· The Group has scheduled the next lifting and expects to
perform this lifting in August 2024
· The Moftinu Gas Field continues to produce at naturally
declining rates
· Production for the period averaged 607 boe/d, comprising:
o Romania - 48 boe/d
o Tunisia - 559 boe/d
· The Group continued its excellent safety record with no Lost
Time Incidents in the first half of 2024
About Serinus
Serinus is an international upstream oil and gas exploration and production
company that owns and operates projects in Tunisia and Romania.
For further information, please refer to the Serinus website
(www.serinusenergy.com) or contact the following:
Serinus Energy plc +44 204 541 7859
Jeffrey Auld, Chief Executive Officer
Calvin Brackman, Vice President, External Relations & Strategy
Shore Capital (Nominated Adviser & Broker)
Toby Gibbs +44 207 408 4090
Lucy Bowden
Forward Looking Statement Disclaimer
This release may contain forward-looking statements made as of the date of
this announcement with respect to future activities that either are not or may
not be historical facts. Although the Company believes that its expectations
reflected in the forward-looking statements are reasonable as of the date
hereof, any potential results suggested by such statements involve risk and
uncertainties and no assurance can be given that actual results will be
consistent with these forward-looking statements. Various factors that could
impair or prevent the Company from completing the expected activities on its
projects include that the Company's projects experience technical and
mechanical problems, there are changes in product prices, failure to obtain
regulatory approvals, the state of the national or international monetary, oil
and gas, financial , political and economic markets in the jurisdictions where
the Company operates and other risks not anticipated by the Company or
disclosed in the Company's published material. Since forward-looking
statements address future events and conditions, by their very nature, they
involve inherent risks and uncertainties, and actual results may vary
materially from those expressed in the forward-looking statement. The Company
undertakes no obligation to revise or update any forward-looking statements in
this announcement to reflect events or circumstances after the date of this
announcement, unless required by law.
Translation: This news release has been translated into Polish from the
English original.
Serinus Energy plc
Half Year Report and Accounts 2024
(US dollars)
Operational UPDATE and Outlook
Serinus Energy plc and its subsidiaries ("Serinus", the "Company" or the
"Group") is an oil and gas exploration, appraisal and development company.
The Group is the operator of all its assets and has operations in two business
units: Romania and Tunisia.
ROMANIA
In Romania the Group currently holds the 2,950 km(2) Satu Mare Concession.
The Satu Mare Concession area includes the Moftinu Gas Project which was
brought on production in April 2019 and has produced approximately 9.5 Bcf and
$93.9 million of revenue to the end of June 2024. The Moftinu gas field is
nearing the end of its natural life. The field has identified existing gas
in uncompleted zones that can be completed and produced with higher gas prices
and reduced windfall tax.
In addition to the Moftinu Gas Development Project the Satu Mare Concession
holds several highly prospective exploration plays. Serinus' block wide
geological review has highlighted the potential of multiple plays that have
encountered oil and gas on the block. Focus is on proven hydrocarbon
systems, known productive trends that need further data, and studies of over
40 legacy wells on the concession area that have encountered oil and gas.
The concession is extensively covered by legacy 2D seismic, augmented by the
Group's own 3D and 2D acquisition programs that have further refined the
identified prospects. Putting this extensive evidence-based analysis
together in a block wide review has allowed the Group to identify a pathway
towards future exploration growth.
In October 2023, the Group was granted an exploration phase extension to the
Satu Mare Concession in Romania. The Moftinu gas field has been declared a
Commercial Area, all other areas of the Concession remain Exploration Area.
The exploration period extension is in two phases. The first phase of the
extension is mandatory and is two years in duration starting on 28 October
2023. The work commitment for the first phase is the reprocessing of 100
kilometres of legacy 2D seismic as well as a 2D seismic acquisition program of
100 kilometres including processing the acquired seismic data. The second
phase of the extension is optional and is two years in duration starting on 28
October 2025 with a work commitment of drilling one well within the concession
area with no total drilling depth requirement stipulated.
In 2018 and 2019, ANAF, the Romanian tax authority, refused to refund VAT
amounts totalling RON 8.3 million (US$1.8 million) after a routine VAT return
submissions in those years. ANAF claimed this VAT couldn't be refunded to
Serinus because it related to the 40% share of a defaulted partner, OEBS. This
decision disregarded the fact that Serinus paid 100% of all costs, including
VAT, and that under the Joint Operating Agreement, Serinus handled all
payments and distributions for the joint venture. All other VAT rebate claims
both prior and post this claim have been fully paid to Serinus. In 2022 the
conclusion of the ICC Arbitration affirmed that the defaulted partner had no
rights subsequent to its default; this includes any claim to VAT paid on its
behalf by Serinus.
In December 2023, Serinus won a court case, which ordered ANAF to refund the
audited VAT amount. The court recognized the defaulted partner as determined
by the 2022 ICC Arbitration award and affirmed Serinus' right to reclaim the
full VAT amount. ANAF appealed this decision in April 2024 without giving a
reason, and it's unclear when the appeal will be heard. Serinus is confident
the VAT refund will be received, although the timing is uncertain. As of 30
June 2024, a total of US$2.5 million is due, being US$1.8 in audited VAT
refund and US$0.7 million in interest and penalties.
Tunisia
The Group's Tunisian operations are comprised of two concession areas.
The largest asset in the Tunisian portfolio is the Sabria field, which is a
large oilfield with an independently estimated original in-place volume of 445
million barrels-of-oil-equivalent of which 1.6% has been produced to date.
Serinus considers this historically under-developed field to be an excellent
asset for development work to significantly increase production in the
near-term. The Group has embarked on an artificial lift programme whereby
the first pumps in the Sabria field will be installed. Independent
third-party studies suggest that the use of pumps in this field can have a
material impact on production volumes.
The Chouech Es Saida concession in southern Tunisia holds a producing oilfield
that produces from four wells, three of which are produced using artificial
lift. Chouech Es Saida is a mature oilfield that benefits from active
production management. Underlying this oilfield are significant gas
prospects. These prospects lie in a structure that currently produces gas in
an adjacent block. Exploration of these lower gas zones became commercially
possible with the construction of gas transportation infrastructure in the
region. Upon exploration success these prospects can be developed in the
medium term, with the ability to access the near-by under-utilised gas
transmission capacity.
Financial Review
Liquidity, Debt and Capital Resources
During the six months ended 30 June 2024, the Company invested a total of $0.2
million (30 June 2023 - $5.0 million) on capital expenditures before working
capital adjustments. In Romania, the Group invested $nil million (30 June
2023 - $0.5 million). In Tunisia, the Company invested $0.2 million (30 June
2023 - $4.5 million).
The Company's funds from operations for the six months ended 30 June 2024 were
$1.3 million (30 June 2023 - $0.4 million). Including changes in non-cash
working capital, the cash flow used from operating activities in 2023 was $0.2
million (30 June 2023 - $1.0 million). The Company continues to be in a
strong position to expand and continue growing production within our existing
resource base. The Company is debt-free and has adequate resources available
to deploy capital into both operating segments to deliver growth and
shareholder returns.
($000) 30 June 31 December
Working Capital 2024 2023
Current assets 10,951 11,341
Current liabilities (15,164) (16,926)
Working Capital (deficit) (4,213) (5,585)
Working capital deficit at 30 June 2024 was $4.2 million (31 December 2023 -
$5.6 million deficit).
Current assets as at 30 June 2024 were $11.0 million (31 December 2023 - $11.3
million), a decrease of $0.3 million. Current assets consist of:
· Cash and cash equivalents of $1.0 million (31 December 2023 -
$1.3 million)
· Restricted cash of $1.1 million (31 December 2023 - $1.2 million)
· Trade and other receivables of $8.0 million (31 December 2023 -
$8.1 million)
· Product inventory of $0.8 million (31 December 2023 - $0.7
million)
Current liabilities as at 30 June 2024 were $15.2 million (31 December 2023 -
$16.9 million), a decrease of $1.8 million. Current liabilities consist of:
· Accounts payable of $8.7 million (31 December 2023 - $9.3
million)
· Decommissioning provision of $6.3 million (31 December 2023 -
$6.7 million)
o Canada - $0.8 million (31 December 2023 - $0.8 million) which is offset by
restricted cash in the amount of $1.1 million (31 December 2023 - $1.2
million) in current assets
o Romania - $nil (31 December 2023 - $0.6 million)
o Tunisia - $5.5 million (31 December 2023 - $5.3 million)
· Income taxes payable of $Nil (31 December 2023 - $0.8 million)
· Current portion of lease obligations of $0.1 million (31 December
2023 - $0.1 million)
Non-current assets
Property, plant and equipment ("PP&E") decreased to $54.3 million (31
December 2023 - $56.0 million), primarily due to capital expenditures in
PP&E of $0.2 million offset by depletion in the period of $1.8 million as
well as a change in decommissioning estimates of $0.1 million which decreased
due to the higher discount rates applied to the calculation during the
period. Exploration and evaluation assets ("E&E") decreased to $10.6
million (31 December 2023 - $10.7 million), due to change in decommissioning
estimates. Right-of-use assets increased to $0.8 million (31 December 2023 -
$0.5 million) due to a new lease in Tunisia for our office and operating
vehicles.
Funds from Operations
The Group uses funds from operations as a key performance indicator to measure
the ability of the Group to generate cash from operations to fund future
exploration and development activities. The following table is a
reconciliation of funds from operations to cash flow from operating
activities:
Six months ended 30 June
($000) 2024 2023
Cash flow from operations 188 967
Changes in non-cash working capital 1,146 (569)
Funds from operations 1,334 398
Funds from operations per share 0.01 0.00
Romania used funds in operations of $0.7 million (30 June 2023 - used funds
$0.4 million) and Tunisia generated $3.6 million (30 June 2023 - $3.4
million). Funds used at the Corporate level were $1.6 million (30 June 2023
- $2.6 million) resulting in net funds from operations of $1.3 million (30
June 2023 - $0.4 million).
Production
Six months ended 30 June 2024 Tunisia Romania Group %
Crude oil (bbl/d) 471 - 471 78%
Natural gas (Mcf/d) 529 290 819 22%
Condensate (bbl/d) - - - 0%
Total (boe/d) 559 48 607 100%
Six months ended 30 June 2023
Crude oil (bbl/d) 471 - 471 70%
Natural gas (Mcf/d) 373 862 1,235 30%
Condensate (bbl/d) - - - 0%
Total (boe/d) 533 144 677 100%
During the six months ended 30 June 2024 production volumes decreased 70 boe/d
to 607 boe/d against the comparative period (30 June 2023 - 677 boe/d).
Romania's production volumes decreased by 96 boe/d to 48 boe/d against the
comparative period (30 June 2023 - 144 boe/d). Production continues to
reflect the natural decline profile of shallow gas fields.
Tunisia's production volumes increased by 26 boe/d to 559 boe/d against the
comparative period (30 June 2023 - 533 boe/d). Production increased during
the first half of 2024 as a result of the Company's programme of pump
installation and management.
Oil and Gas Revenue
($000)
Six months ended 30 June 2024 Tunisia Romania Group %
Oil revenue 7,185 - 7,185 82%
Natural gas revenue 1,148 478 1,626 18%
Condensate revenue - - - 0%
Total revenue 8,333 478 8,811 100%
Six months ended 30 June 2023 Tunisia Romania Group %
Oil revenue 6,162 - 6,162 77%
Natural gas revenue 703 2,012 2,715 23%
Condensate revenue - - - 0%
Total revenue 6,865 2,012 8,877 100%
Realised Price
Six months ended 30 June 2024 Tunisia Romania Group
Oil ($/bbl) 84.07 - 84.07
Natural gas ($/Mcf) 11.93 9.43 11.06
Condensate ($/bbl) - - -
Average realised price ($/boe) 82.10 56.56 80.13
Six months ended 30 June 2023
Oil ($/bbl) 74.75 - 74.75
Natural gas ($/Mcf) 10.76 13.34 12.56
Condensate ($/bbl) - - -
Average realised price ($/boe) 73.56 80.01 74.93
During the six months ended 30 June 2024 revenue decreased by $0.1 million to
$8.8 million (30 June 2023 - $8.9 million) as the Group saw production decline
in Romania offset by the average realised price increase of $5.2/boe to
$80.13/boe (30 June 2023 - $74.93/boe) and increased production in Tunisia.
The Group's average realised oil price increased by $9.32/bbl to $84.07/bbl
(30 June 2023 - $74.75/bbl), and average realised natural gas prices decreased
by $1.50/Mcf to $11.06/Mcf (30 June 2023 - $12.56/Mcf).
Under the terms of the Sabria Concession Agreement the Group is required to
sell 20% of its annual crude oil production from the Sabria concession into
the local market, which is sold at an approximate 10% discount to the price
obtained on its other crude sales. The remaining crude oil production was
sold to the international market.
Royalties
Six months ended 30 June
($000) 2024 2023
Tunisia 1,064 889
Romania 21 97
Total 1,085 986
Total ($/boe) 9.87 8.46
Tunisia oil royalty (% of oil revenue) 12.9% 13.5%
Romania gas royalty (% of gas revenue) 4.4% 4.8%
Total (% of revenue) 12.3% 11.1%
For the six months ended 30 June 2024 royalties increased to $1.1 million (30
June 2023 - $1.0 million) and the Group's royalty rate increased to 12.3% (30
June 2023 - 11.1%).
In Romania, the royalty is calculated using a reference price that is set by
the Romanian authorities and not the realised price to the Group. The
reference gas prices in the first quarter were higher than the realised
prices. Romanian royalty rates vary based on the level of production during
the quarter. Natural gas royalty rates range from 3.5% to 13.0% and
condensate royalty rates range from 3.5% to 13.5%.
In Tunisia, royalties vary based on individual concession agreements. Sabria
royalty rates vary depending on a calculation of cumulative revenues, net of
taxes, as compared to cumulative investment in the concession, known as the "R
factor". As the R factor increases, so does the royalty percentage to a
maximum rate of 15%. During the first six-month period of 2024, the royalty
rate remained unchanged in Sabria at 10% for oil and 8% for gas. Chouech Es
Saida royalty rates are flat at 15% for both oil and gas.
Production Expenses
Six months ended 30 June
($000) 2024 2023
Tunisia 3,238 2,572
Romania 916 1,600
Canada 5 25
Group 4,159 4,197
Tunisia production expense ($/boe) 31.91 27.56
Romania production expense ($/boe) 108.37 63.62
Total production expense ($/boe) 37.83 35.43
During the six months ended 30 June 2024 production expenses stayed the same
at $4.2 million (30 June 2023 - $4.2 million), with an increase of $2.40/boe
to $37.98 (30 June 2023 - $ 35.43/boe).
Tunisia's production expenses increased by $0.7 million, to $3.2 million (30
June 2023 - $2.5 million), being an increase of $4.35/boe to $31.91/boe (30
June 2023 - $27.56/boe).
Romania's overall operating costs decreased by $0.6 million to $1.0 million
(30 June 2023 - $1.6 million), being an increase of $44.75/boe to $108.37/boe
(30 June 2023 - $63.62/boe). The decrease in production costs is a result of
lower production in Romania.
Canada production expenses relate to the Sturgeon Lake assets, which are not
producing and are incurring minimal operating costs to maintain the property.
Operating Netback
Serinus uses operating netback as a key performance indicator to assist
management in understanding Serinus' profitability relative to current market
conditions and as an analytical tool to benchmark changes in operational
performance against prior periods. Operating netback consists of petroleum
and natural gas revenues less direct costs consisting of royalties and
production expenses. Netback is not a standard measure under IFRS and
therefore may not be comparable to similar measures reported by other
entities.
($/boe)
Six months ended 30 June 2024 Tunisia Romania Group
Sales volume (boe/d) 558 46 604
Realised price 82.10 56.56 80.13
Royalties (10.48) (2.51) (9.87)
Production expense (31.91) (108.37) (37.83)
Operating netback 39.71 (54.32) 32.43
Six months ended 30 June 2023 Tunisia Romania Group
Sales volume (boe/d) 516 139 655
Realised price 73.56 80.01 74.93
Royalties (9.53) (3.86) (8.32)
Production expense (27.56) (63.62) (35.43)
Operating netback 36.47 12.53 31.18
For the six months ended 30 June 2024 the Group's operating netback was $32.43
boe, an increase of $1.25/boe against the comparative period (30 June 2023 -
$31.18/boe). The increase is due to higher realised prices in Tunisia,
partially offset by higher production expenses.
The Company also generated a gross profit of $1.7 million (30 June 2023 - $0.8
million), partly due to an increase in the Company's netbacks.
Earnings Before Interest, Taxes, Depreciation and Amortization ("ebitda")
Serinus uses EBITDA as a key performance indicator to assist management in
understanding Serinus' cash profitability. EBITDA is computed as net
profit/loss and adding back interest, taxation, depreciation, depletion and
amortisation expense, as well as accretion on asset retirement obligations and
non-operating income and expenses. EBITDA is not a standard measure under
IFRS and therefore may not be comparable to similar measures reported by other
entities. For the six months ended 30 June 2024, the Group's EBITDA
increased by $1.1 million to $1.6 million (30 June 2023 - $ 0.5 million).
Six months ended 30 June
($000s) 2024 2023
Net income (loss) (1,294) (2,963)
Finance costs, including accretion 465 847
Depletion and amortization 1,750 2,352
Decommissioning provision recovery (14) (23)
Gain on disposal of assets (37) -
Tax expense 733 289
EBITDA 1,603 502
Windfall Tax
Six months ended 30 June
($000) 2024 2023
Windfall tax 132 564
Windfall tax ($/Mcf - Romania gas) 2.50 3.61
Windfall tax ($/boe - Romania gas) 15.60 22.41
For the six months ended 30 June 2024 windfall taxes were $0.1 million (30
June 2023 - $0.6 million).
In Romania, the Group is subject to a windfall tax on its natural gas
production which is applied to supplemental income once natural gas prices
exceed 47.53 RON/Mwh. This supplemental income is taxed at a rate of 60%
between 47.53 RON/Mwh and 85.00 RON/Mwh and at a rate of 80% above 85.00
RON/Mwh. Expenses deductible in the calculation of the windfall tax include
royalties and capital expenditures limited to 30% of the supplemental income
below the 85.00 RON/Mwh threshold.
During the last two months of the first quarter, sales were under a regulated
price with no windfall tax incurred during that time. Unregulated pricing and
windfall taxes will apply in the second quarter onwards.
Depletion and Depreciation
Six months ended 30 June
($000) 2024 2023
Tunisia 1,614 1,688
Romania 73 623
Corporate 63 41
Total 1,750 2,352
Tunisia ($/boe) 15.90 18.08
Romania ($/boe) 8.65 24.78
Total ($/boe) 15.92 19.86
For the six months ended 30 June 2024 depletion and depreciation expense was
$1.8 million (30 June 2023 - $2.4 million), primarily due to a lower
production during the period. Per boe, depletion and depreciation expense
decreased by $3.94/boe to $15.92/boe (30 June 2023 - $19.86/boe), primarily
due to lower reserves in the current period.
General and Administrative ("G&A") Expense
Six months ended 30 June
($000) 2024 2023
G&A expense 1,832 2,670
G&A expense ($/boe) 16.66 22.54
For the six months ended 30 June 2024 G&A expenses were $1.8 million (30
June 2023 - $ 2.7 million). Per boe, G&A expense is lower at $16.66/boe
(30 June 2023 - $22.54/boe) mainly due to decreased professional services
fees.
Share-Based Payment
Six months ended 30 June
($000) 2024 2023
Share-based payment - 3
Share-based payment ($/boe) - 0.02
No share-based payment expense was recognised in the first half of 2024 (30
June 2023 - $3,000) since no options were granted during the period and all
previously granted option had fully vested.
Net Finance Expense
Six months ended 30 June
($000) 2024 2023
Interest on leases 62 -
Accretion on decommissioning provision 849 785
Foreign exchange and other (446) 17
465 802
During the six months ended 30 June 2024 net finance expenses decreased by
$0.3 million to $0.5 million (30 June 2023 - $0.8 million).
Taxation
During the six months ended 30 June 2024 income tax expense was $0.7 million
(30 June 2023 - $0.3 million). The increase in the tax expense is directly
related to higher taxable income in Tunisia during the period.
Share Data
As at the date of issuing this report, the following are the Directors stock
options outstanding, Long Term Incentive Program ("LTIP") awards, and shares
owned up to the date of this report.
Share Options LTIP Awards Shares
Executive Directors:
Jeffrey Auld 2,230,000 499,084 3,993,394
Non-Executive Directors:
Lukasz Redziniak - - 302,000
Jim Causgrove - - 290,000
Jon Kempster 1 (#_ftn1) - - 60,261
2,230,000 499,084 4,645,655
As of the date of issuing this report, management is aware of the following
shareholders holding more than 3% of the ordinary shares of the Group, as
reported by the shareholders to the Group:
Xtellus Capital Partners Inc 13.03%
Crux Asset Management 8.22%
Michael Hennigan 7.76%
Quercus TFI SA 7.02%
Marlborough Fund Managers 4.05%
Spreadex LTD 4.01%
Jeffrey Auld 3.48%
The Directors are responsible for the maintenance and integrity of the
corporate and financial information on the Group's website. Legislation in
Jersey governing the preparation and dissemination of financial statements may
differ from legislation in other jurisdictions.
Going Concern
The Group's business activities, together with the factors likely to affect
its future development and performance are set out in the Operational Update
and Outlook. The financial position of the Group is described in these
condensed consolidated interim financial statements and in the Financial
Review.
The Directors have given careful consideration to the appropriateness of the
going concern assumption, including cashflow forecasts through the going
concern period and beyond, planned capital expenditure and the principal risks
and uncertainties faced by the Group. This assessment also considered
various downside scenarios including oil and gas commodity prices and
production rates. Following this review, the Directors are satisfied that
the Group has sufficient resources to operate and meet its commitments as they
come due in the normal course of business for at least 12 months from the date
of these condensed consolidated interim financial statements. Accordingly,
the Directors continue to adopt the going concern basis for the preparation of
these condensed consolidated interim financial statements.
Declarations of the Board of Directors Concerning Accounting Policies
The Board of Directors of the Company confirms that, to the best of their
knowledge, the condensed consolidated interim financial statements together
with comparative figures have been prepared in accordance with applicable
accounting standards and give a true and fair view of the state of affairs and
the financial result of the Group for the period ended 30 June 2024.
The Financial Review in this report gives a true and fair view of the
situation on the reporting date and of the developments during the period
ended 30 June 2024 and include a description of the major risks and
uncertainties.
Serinus Energy plc
Consolidated Statement of Comprehensive Loss
(US$ 000s, except per share amounts)
Six months ended 30 June
2024 2023
Revenue 8,811 8,877
Cost of sales
Royalties (1,085) (986)
Windfall tax (132) (564)
Production expenses (4,159) (4,197)
Depletion and depreciation (1,750) (2,352)
Total cost of sales (7,126) (8,099)
Gross profit 1,685 778
Administrative expenses (1,832) (2,670)
Share-based payment expense - (3)
Total administrative expenses (1,832) (2,673)
Decommissioning provision recovery 14 23
Gain on disposal of assets 37 -
Operating loss (96) (1,872)
Finance expense (465) (802)
Net loss before tax (561) (2,674)
Tax expense (733) (289)
Loss after taxation attributable to equity owners of the parent (1,294) (2,963)
Other comprehensive loss
Other comprehensive loss to be classified to profit and loss in subsequent
periods:
Foreign currency translation adjustment - (239)
Total comprehensive loss for the year attributable to equity owners of the (1,294) (3,202)
parent
Earnings (loss) per share:
Basic (0.01) (0.03)
Diluted (0.01) (0.03)
The accompanying notes on pages 15 to 16 form part of the condensed
consolidated interim financial statements
Serinus Energy plc
Condensed Consolidated Interim Statement of Financial Position
(US$ 000s, except per share amounts)
As at 30 June 31 December
2024 2023
Non-current assets
Property, plant and equipment 54,284 56,032
Exploration and evaluation assets 10,602 10,703
Right-of-use assets 798 498
Total non-current assets 65,684 67,233
Current assets
Restricted cash 1,163 1,171
Trade and other receivables 8,014 8,137
Product inventory 773 698
Cash and cash equivalents 1,001 1,335
Total current assets 10,951 11,341
Total assets 76,635 78,574
Equity
Share capital 401,426 401,426
Share-based payment reserve 25,102 25,560
Treasury shares - (458)
Accumulated deficit (400,672) (399,378)
Cumulative translation reserve (3,372) (3,372)
Total equity 22,484 23,778
Liabilities
Non-current liabilities
Decommissioning provision 24,507 24,004
Deferred tax liability 12,463 12,125
Lease liabilities 700 424
Other provisions 1,317 1,317
Total non-current liabilities 38,987 37,870
Current liabilities
Current portion of decommissioning provision 6,300 6,720
Current portion of lease liabilities 144 137
Accounts payable and accrued liabilities 8,720 10,069
Total current liabilities 15,164 16,926
Total liabilities 54,151 54,796
Total liabilities and equity 76,635 78,574
The accompanying notes on pages 15 to 16 form part of the condensed
consolidated interim financial statements
Serinus Energy plc
Condensed Consolidated Interim Statement of Changes in Shareholder's Equity
(US$ 000s, except per share amounts)
Share capital Share-based payment reserve Treasury Accumulated deficit Accumulated other comprehensive loss Total
Shares
Balance at 31 December 2022 401,426 25,557 (455) (386,356) (3,372) 36,800
Comprehensive income for the period - - - (2,963) - (2,963)
Other comprehensive loss for the period - - - - (239) (239)
Total comprehensive (income) loss for the period - - - (2,963) (239) (3,202)
Transactions with equity owners
Share-based payment expense - 3 - - - 3
Shares purchased to be held in Treasury - - (12) - - (12)
Balance at 30 June 2023 401,426 25,560 (467) (389,319) (3,611) 33,589
Balance at 31 December 2023 401,426 25,560 (458) (399,378) (3,372) 23,778
Comprehensive loss for the period - - - (1,294) - (1,294)
Other comprehensive loss for the period - - - - - -
Total comprehensive loss for the period - - - (1,294) - (1,294)
Transactions with equity owners - - - - - -
Treasury shares issued to employees - (458) 458 - - -
Balance at 30 June 2024 401,426 25,102 - (400,672) (3,372) 22,484
The accompanying notes on pages 15 to 16 form part of the condensed
consolidated interim financial statements
Serinus Energy plc
Condensed Consolidated Interim Statement of Cash Flows
(US$ 000s, except per share amounts)
Six months ended 30 June
2024 2023
Operating activities
Loss for the period (1,294) (2,963)
Items not involving cash:
Depletion and depreciation 1,750 2,352
Share-based payment expense - 3
Tax expense 733 289
Accretion expense on decommissioning provision 849 785
Foreign exchange gain (131) (20)
Decommissioning provision recovery (14) (23)
Gain on disposal of asset (37) -
Other income 30 (25)
Income taxes paid (552) -
Funds from operations 1,334 398
Changes in non-cash working capital (1,146) 569
Cashflows from operating activities 188 967
Financing activities
Lease payments (183) (133)
Shares purchased to be held in treasury - (12)
Cashflows used in financing activities (183) (145)
Investing activities
Capital expenditures (296) (3,054)
Cashflows used in investing activities (296) (3,054)
Impact of foreign currency translation on cash (43) (142)
Change in cash and cash equivalents (334) (2,374)
Cash and cash equivalents, beginning of period 1,335 4,854
Cash and cash equivalents, end of period 1,001 2,480
The accompanying notes on pages 15 to 16 form part of the condensed
consolidated interim financial statements
1. General information
Serinus Energy plc and its subsidiaries are principally engaged in the
exploration and development of oil and gas properties in Tunisia and Romania.
Serinus is incorporated under the Companies (Jersey) Law 1991. The Group's
head office and registered office is located at 2(nd) Floor, The Le Gallais
Building, 54 Bath Street, St. Helier, Jersey, JE1 1FW.
Serinus is a publicly listed company whose ordinary shares are traded under
the symbol "SENX" on AIM and "SEN" on the WSE.
2. Basis of presentation
The condensed consolidated interim financial statements have been prepared in
accordance with International Financial Reporting Standards ("IFRS") and their
interpretations issued by the International Accounting Standards Board
("IASB") as adopted by the United Kingdom applied in accordance with the
provisions of the Companies (Jersey) Law 1991.
These condensed consolidated interim financial statements are expressed in
U.S. dollars unless otherwise indicated. All references to US$ are to U.S.
dollars. All financial information is rounded to the nearest thousands,
except per share amounts and when otherwise indicated.
Information about significant areas of estimation uncertainty and critical
judgements in applying accounting policies that have the most significant
effect on the amounts recognised in the condensed consolidated interim
financial statements are described in Note 5 to the consolidated financial
statements for the year ended 31 December 2023. There has been no change in
these areas during the six months ended 30 June 2024.
Going concern
The Group's business activities, together with the factors likely to affect
its future development and performance are set out in the Operational Update
and Outlook. The financial position of the Group is described in these
condensed consolidated interim financial statements and in the Financial
Review.
The Directors have given careful consideration to the appropriateness of the
going concern assumption, including cashflow forecasts through the going
concern period and beyond, planned capital expenditure and the principal risks
and uncertainties faced by the Group. This assessment also considered
various downside scenarios including oil and gas commodity prices and
production rates. Following this review, the Directors are satisfied that
the Group has sufficient resources to operate and meet its commitments as they
come due in the normal course of business for at least 12 months from the date
of these condensed consolidated interim financial statements. Accordingly,
the Directors continue to adopt the going concern basis for the preparation of
these condensed consolidated interim financial statements.
3. Significant accounting policies
The condensed consolidated interim financial statements have been prepared
following the same basis of measurement, accounting policies and methods of
computation as described in the notes to the consolidated financial statements
for the year ended 31 December 2023. There has been no change to the
accounting policies or the estimates and judgements which management are
required to make in the period. The business is not subject to seasonal
variations. Information in relation to the operating segments and material
primary statement movements can be found within the management discussion at
the front of this report.
4. Earnings (Loss) per share
Period ended 30 June
($000's, except per share amounts) 2024 2023
Loss for the period (1,294) (2,963)
Weighted average shares outstanding
Basic and diluted 114,709 114,686
Loss per share
Basic and diluted (0.01) (0.03)
In determining diluted net loss per share, the Group assumes that the proceeds
received from the exercise of "in-the-money" stock options are used to
repurchase ordinary shares at the average market price. Diluted loss per share
for the current and comparative periods is equivalent to basic loss per share
since the effect of all dilutive potential Ordinary Shares is anti-dilutive.
5. Supplemental cash flow disclosure
Period ended 30 June
2024 2023
Cash provided by (used in):
Trade and other receivables 140 (54)
Product inventory (230) 314
Accounts payable and accrued liabilities (997) 306
Restricted cash (59) 3
Changes in non-cash working capital from operating activities (1,146) 569
The following table reconciles capital expenditures to the cash flow
statement:
Period ended 30 June
2024 2023
PP&E additions 192 4,963
E&E additions - -
Total capital additions 192 4,963
Changes in non-cash working capital from investing activities 104 (1,909)
Total capital expenditures 296 3,054
1 Jon Kempster resigned as a director on 2 July 2024, shares are held by
Catherine Kempster (the spouse of Jon Kempster)
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