REG - Serinus Energy PLC - Q3 2024 Financial Results
25/11/2024 07:00
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RNS Number : 4194N Serinus Energy PLC 25 November 2024
25 November 2024
Press Release
Q3 2024 Interim Financial Results
Jersey, Channel Islands, 25 November 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 nine months ended 30 September 2024.
Third Quarter 2024 Highlights
Financial
· Revenue for the nine months ended 30 September 2024 was $12.2
million (30 September 2023 - $13.3 million)
· Funds from operations for the nine months ended 30 September 2024
were $1.9 million (30 September 2023 - $1.2 million)
· EBITDA for the nine months ended 30 September 2024 was $1.9
million (30 September 2023 - $1.2 million)
· Gross profit for the nine months ended 30 September 2024 was $1.8
million (30 September 2023 - $1.8 million)
· The Group realised a net price of $78.24/boe for the nine months
ended 30 September 2024 comprising:
o Realised oil price - $81.52bbl
o Realised natural gas price - $11.19/Mcf
· The Group's operating netback decreased for the nine months ended
30 September 2024 and was $29.82/boe (30 September 2023 - $34.15/boe),
comprising:
o Tunisia operating netback - $36.39/boe (30 September 2023 - $40.68/boe)
o Romania operating netback - ($43.24)/boe (30 September 2023 - $4.22/boe)
· Capital expenditures of $0.9 million for the nine months ended 30
September 2024 (30 September 2023 - $5.3 million), comprising:
o Tunisia - $0.9 million
o Romania - $nil million
Operational
· Production in Chouech Es Saida continues to be stable and
benefits from artificial lift programme
· Workovers to replace pumps at the CS-3 and CS-7 wells in Chouech
es Saida were completed under time and under budget.
· Pump life has been extended in Chouech es Saida and the most
recently replaced pumps had in-hole lives just short of four years. Longer
pump life improves the economics of the capital allocated to the artificial
lift program.
· Long lead items for the Sabria W-1 sidetrack have been ordered
and received in country. 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 50,344 bbls of Tunisian crude oil in
August 2024 at an average price of $80.79/bbl with the cash proceeds of $1.9
million received in September 2024 (net of $2.2 million in monthly prepayments
previously received)
· The Group has scheduled the next lifting for December 2024
· Production for nine months ended 30 September 2024 averaged 577
boe/d, comprising:
o Tunisia - 522 boe/d
o Romania - 55 boe/d
· The Group continued its excellent safety record with no Lost Time
Incidents in the first nine months 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
Third Quarter 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.
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 1.7% has been produced to date.
Serinus considers this historically under-developed field to be an excellent
asset for further 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. Over the last year, the production has increased by
17%. Two workovers to replace pumps took place on CS-3 and CS-7 wells. The
replaced pumps have been in service for more than four years and had
out-performed expectations. Both workovers were successful and came in ahead
of schedule and budget. 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 that is currently underutilised. 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.
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
$94.2 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.
The Moftinu gas field has been declared a commercial area, while the rest of
the Satu Mare Concession remains an exploration area. In October 2023, an
extension was granted for the Satu Mare Concession's exploration phase,
requiring reprocessing of 100km of legacy 2D seismic data and a 100km 2D
seismic acquisition program including processing of the acquired seismic data.
The optional second phase, beginning in October 2025, spans two years and
includes commitment to drill one well within the concession area, with no
specified total drilling depth.
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 was attributed 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 the appeal is scheduled for early February 2025, although the
management is requesting an earlier hearing date. Serinus is confident the VAT
refund will be received, although the timing is uncertain. As of 30 September
2024, a total of $2.6 million is due, being $1.8 in audited VAT refund and
$0.8 million in interest and penalties.
Financial Review
Liquidity, Debt and Capital Resources
During the nine months ended 30 September 2024, the Group invested a total of
$0.9 million (2023 - $5.3 million) on capital expenditures before working
capital adjustments. In Tunisia, the Group invested $0.9 million (2023 - $4.8
million) of which $0.4 million was invested in workovers on wells, $0.4
million on SAB W-1 sidetrack and $0.1 million in capital inventory additions.
In Romania, the Group invested $nil million (2023 - $0.5 million).
The Group's funds from operations for the nine months ended 30 September 2024
were $1.9 million (2023 - $1.2 million). Including changes in non-cash
working capital, the cash flow generated from operating activities in first
nine months of 2024 was $0.8 million (2023 - $1.7 million). The Group
continues to be in a strong position to expand and continue growing production
within our existing resource base. The Group remains debt-free and has
adequate resources available to deploy capital into both operating business
units to deliver growth and shareholder returns.
($000) 30 September 31 December
Working Capital 2024 2023
Current assets 9,197 11,341
Current liabilities (14,379) (16,926)
Working Capital surplus (deficit) (5,182) (5,585)
Working capital deficit as at 30 September 2024 is $5.2 million (31 December
2023 - $5.6 million).
Current assets as at 30 September 2024 were $9.2 million (31 December 2023 -
$11.3 million), a decrease of $2.1 million. Current assets consist of:
· Cash and cash equivalents of $1.3 million (31 December 2023 -
$1.3 million)
· Restricted cash of $1.2 million (31 December 2023 - $1.2 million)
· Trade and other receivables of $5.7million (31 December 2023 -
$8.1 million)
· Product inventory of $1.0 million (31 December 2023 - $0.7
million)
Current liabilities as at 30 September 2024 were $14.4 million (31 December
2023 - $16.9 million), a decrease of $2.5 million. Current liabilities consist
of:
· Accounts payable of $6.9 million (31 December 2023 - $9.3
million)
· Decommissioning provision of $6.9 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 $1.12 million (31 December 2023 - $1.2
million) in current assets
o Romania - $0.6 million (31 December 2023 - $0.6 million)
o Tunisia - $5.5 million (31 December 2023 - $5.3 million)
· Income taxes payable of $0.4 (31 December 2023 - $0.8 million)
· Current portion of lease obligations of $0.2 million (31 December
2023 - $0.1 million)
Non-current assets
Property, plant and equipment ("PP&E") decreased to $55.1 million (31
December 2023 - $56.0 million), primarily due to capital expenditures in
PP&E of $0.9 million and a change in decommissioning provision of $0.6
million offset by depletion in the period of $2.4 million. 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 $0.7 million (31 December 2023 - $0.5 million) due to new
office and vehicle leases in Tunisia and new vehicle lease in Romania.
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:
Nine months ended 30 September
($000) 2024 2023
Cash flow from operations 830 1,697
Changes in non-cash working capital 1,113 (518)
Funds from operations 1,943 1,179
Funds from operations per share 0.02 0.01
Tunisia generated $4.8 million (2023 - $5.8 million) and Romania used funds in
operations of $0.6 million (2023 - $0.7 million). Funds used at the
Corporate level were $2.3 million (2023 - $3.9 million) resulting in net funds
from operations of $1.9 million (2023 - $1.2 million).
Production
Nine months ended 30 September 2024 Tunisia Romania Group %
Crude oil (bbl/d) 439 - 439 76%
Natural gas (Mcf/d) 498 332 830 24%
Condensate (bbl/d) - - - -
Total (boe/d) 522 55 577 100%
Nine months ended 30 September 2023
Crude oil (bbl/d) 454 - 454 71%
Natural gas (Mcf/d) 415 703 1,118 29%
Condensate (bbl/d) - - - -
Total (boe/d) 524 117 641 100%
During the nine months ended 30 September 2024 production volumes decreased by
64 boe/d to 577 boe/d against the comparative period (2023 - 641 boe/d).
Romania's production volumes decreased by 62 boe/d to 55 boe/d against the
comparative period (2023 - 117 boe/d). Production continues to reflect the
natural decline profile of shallow gas fields.
Tunisia's production volumes decreased by 2 boe/d to 522 boe/d against the
comparative period (2023 - 524 boe/d). Production remains stable during the
nine months of 2024 as a result of the oil fields' maintenance programme.
Ongoing workover programmes continue in the Chouech Es Saida field as part of
active production management.
Oil and Gas Revenue
($000)
Nine months ended 30 September 2024 Tunisia Romania Group %
Oil revenue 9,774 - 9,774 80%
Natural gas revenue 1,631 749 2,380 20%
Condensate revenue - - - -
Total revenue 11,405 749 12,154 100%
Nine months ended 30 September 2023 Tunisia Romania Group %
Oil revenue 9,732 - 9,732 73%
Natural gas revenue 1,203 2,331 3,534 27%
Condensate revenue - - - -
Total revenue 10,935 2,331 13,266 100%
Realised Price
Nine months ended 30 September 2024 Tunisia Romania Group
Oil ($/bbl) 81.52 - 81.52
Natural gas ($/Mcf) 11.94 9.85 11.19
Average realised price ($/boe) 79.95 59.10 78.24
Nine months ended 30 September 2023 `
Oil ($/bbl) 78.68 - 78.68
Natural gas ($/Mcf) 10.61 12.92 12.03
Average realised price ($/boe) 76.69 77.52 76.84
During the nine months ended 30 September 2024 revenue decreased by $1.1
million to $12.2 million (2023 - $13.3 million) as the Group saw the average
realised price increase to $78.24/boe (2023 - $76.84/boe) offset by production
decline in Romania.
The Group's average realised oil price increased to $81.52/bbl (2023 -
$78.68/bbl), and average realised natural gas prices decreased to $11.19/Mcf
(30 September 2023 - $12.03/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
Zarzatine oil price (local reference). The remaining crude oil production was
sold at the international market.
Royalties
Nine months ended 30 September
($000) 2024 2023
Tunisia 1,475 1,366
Romania 34 111
Total 1,509 1,477
Total ($/boe) 9.72 8.55
Tunisia oil royalty (% of oil revenue) 12.9% 12.5%
Romania gas royalty (% of gas revenue) 4.6% 4.7%
Total (% of revenue) 12.4% 11.1%
For the nine months ended 30 September 2024 royalties stayed the same at $1.5
million (30 September 2023 - $1.5 million) while the Group's average royalty
rate increased to 12.4% (30 September 2023 - 11.1%).
In Romania, during nine months of 2024, the Group incurred a 4.6% royalty rate
for gas (30 September 2023 - 4.7%). 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 during nine months of 2024
remained higher than the realised prices by 40%. 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 nine months 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
Nine months ended 30 September
($000) 2024 2023
Tunisia 4,740 3,768
Romania 1,263 2,094
Canada 8 31
Group 6,011 5,893
Tunisia production expense ($/boe) 33.22 26.43
Romania production expense ($/boe) 99.64 69.64
Total production expense ($/boe) 38.70 34.14
During the nine months ended 30 September 2024 production expenses increased
by $0.1 million to $6.0 million (30 September 2023 - $5.9 million). Per unit
production expenses increased to $38.70/boe (30 September 2023 -
$34.14/boe).
Tunisia's production expenses increased by $0.9 million to $4.7 million (2023
- $3.8 million), being an increase of $6.79/boe to $33.22/boe (30 September
2023 - $26.43/boe) mainly due to the increase of roads maintenance in Chouech
Es Saida as consequence of weather condition changes resulting in increased
frequency of sandstorms.
Romania's overall operating costs decreased by $0.8 million to $1.3 million
(2023 - $2.1 million) as a result of lower production in Romania, however per
unit production expenses increased to $99.64/boe (30 September 2023 -
$69.64/boe).
Canada production expenses relate to the Sturgeon Lake assets, which are not
producing and are incurring minimal operating costs to maintain the property.
Operating Netback
Serinus uses operating netback as a key performance indicator to assist
management in understanding Serinus' profitability relative to current market
conditions and as an analytical tool to benchmark changes in operational
performance against prior periods. Operating netback consists of petroleum
and natural gas revenues less direct costs consisting of royalties and
production expenses. Netback is not a standard measure under IFRS and
therefore may not be comparable to similar measures reported by other
entities.
($/boe)
Nine months ended 30 September 2024 Tunisia Romania Group
Sales volume (boe/d) 521 46 567
Realised price 79.95 59.10 78.24
Royalties (10.34) (2.70) (9.72)
Production expense (33.22) (99.64) (38.70)
Operating netback 36.39 (43.24) 29.82
Nine months ended 30 September 2023 Tunisia Romania Group
Sales volume (boe/d) 522 110 632
Realised price 76.69 77.52 76.84
Royalties (9.58) (3.66) (8.55)
Production expense (26.43) (69.64) (34.14)
Operating netback 40.68 4.22 34.15
For the nine months ended 30 September 2024 the Group's operating netback was
$29.82/boe (30 September 2023 - $34.15/boe). The decrease is due to lower
realised prices in Romania and higher per unit production expenses.
The Group achieved a gross profit of $1.8 million (30 September 2023 - $1.8
million) due to increased average realised price offset by increased
production costs.
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, depletion and depreciation,
and amortisation expense. EBITDA is not a standard measure under IFRS and
therefore may not be comparable to similar measures reported by other
entities. During the nine months ended 30 September 2024, the Group's EBITDA
increased by $0.7 million to $1.9 million (30 September 2023 - $1.2 million).
Nine months ended 30 September
($000) 2024 2023
Net income (loss) (2,623) (4,559)
Finance costs, including accretion 825 1,277
Depletion and amortization 2,587 3,432
Gain on sale of asset (37) -
Decommissioning provision recovery 9 (36)
Tax expense 1,120 1,112
EBITDA 1,881 1,226
Windfall Tax
Nine months ended 30 September
($000) 2024 2023
Windfall tax 217 661
Windfall tax ($/Mcf - Romania gas) 2.38 3.44
Windfall tax ($/boe - Romania gas) 17.10 21.97
For the nine months ended 30 September 2024 windfall taxes were $0.2 million
(30 September 2023 - $0.7 million). This decrease is directly related to a
combination of lower production and lower realised gas prices in Romania.
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.
Depletion and Depreciation
Nine months ended 30 September
($000) 2024 2023
Tunisia 2,350 2,617
Romania 143 742
Corporate 94 73
Total 2,587 3,432
Tunisia ($/boe) 16.47 18.35
Romania ($/boe) 11.27 24.67
Total ($/boe) 16.66 19.88
For the nine months ended 30 September 2024 depletion and depreciation expense
was $2.6 million (30 September 2023 - $3.4 million). The decrease is primarily
due to lower production during the period. Per boe, depletion and
depreciation expense decreased to $16.66/boe (30 September 2023 - $19.88/boe),
primarily due to lower reserves in the current period.
General and Administrative ("G&A") Expense
Nine months ended 30 September
($000) 2024 2023
G&A expense 2,530 4,006
G&A expense ($/boe) 16.29 23.20
For the nine months ended 30 September 2024 G&A expenses decreased by $1.5
million to $2.5 million (30 September 2023 - $4.0 million) due to decreased
personnel costs and professional services fees.
Share-Based Payment
Nine months ended 30 September
($000) 2024 2023
Share-based payment 6 3
Share-based payment ($/boe) 0.04 0.02
During the nine months ended 30 September 2024 share-based compensation was
$6,000 (30 September 2023 - $3,000) due to a grant of shares in June 2024.
Net Finance Expense
Nine months ended 30 September
($000) 2024 2023
Interest on leases 99 34
Accretion on decommissioning provision 1,261 1,272
Foreign exchange and other (535) (29)
825 1,277
During the nine months ended 30 September 2024 net finance expenses decreased
by $0.5 million to $0.8 million (30 September 2023 - $1.3 million).
Taxation
During the nine months ended 30 September 2024 income tax expense was $1.1
million (30 September 2023 - $1.1 million).
Share Data
As at the date of issuing this report, the following are the Directors stock
options outstanding, LTIP awards, and shares owned up to the date of this
report.
Share Options LTIP Awards Shares
Executive Directors:
Jeffrey Auld 2,230,000 - 4,992,954
Non-Executive Directors:
Jim Causgrove - - 290,000
Lukasz Redziniak - - 302,000
Jon Kempster 1 (#_ftn1) - - 60,261
2,230,000 - 5,645,215
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 19.81%
Crux Asset Management 7.80%
Michael Hennigan 7.36%
Quercus TFI SA 6.65%
Jeffrey Auld 4.13%
Marlborough Fund Managers 3.84%
Spreadex LTD 3.80%
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.
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 September 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 September 2024 and include a description of the major risks and
uncertainties.
Serinus Energy plc
Consolidated Interim Statement of Comprehensive Loss
(US$ 000s, except per share amounts)
Nine months ended 30 September
Note 2024 2023
Revenue 12,154 13,266
Cost of sales
Royalties (1,509) (1,477)
Windfall tax (217) (661)
Production expenses (6,011) (5,893)
Depletion and depreciation (2,587) (3,432)
Total cost of sales (10,324) (11,463)
Gross profit 1,830 1,803
General and Administrative expenses (2,530) (4,006)
Share-based payment expense (6) (3)
Total administrative expenses (2,536) (4,009)
Decommissioning provision recovery (9) 36
Gain on sale of asset 37 -
Operating income (loss) (678) (2,170)
Finance expense (825) (1,277)
Net income before tax (1,503) (3,447)
Tax expense (1,120) (1,112)
Income (loss) after taxation attributable to equity owners of the parent (2,623) (4,559)
Other comprehensive loss
Other comprehensive loss to be classified to profit and loss in subsequent
periods:
Foreign currency translation adjustment - (70)
Total comprehensive loss for the period attributable to equity owners of the (2,623) (4,629)
parent
Earnings (loss) per share:
Basic 4 (0.02) (0.04)
Diluted 4 (0.02) (0.04)
The accompanying notes on pages 13 to 14 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 September 31 December
2024 2023
Non-current assets
Property, plant and equipment 55,141 56,032
Exploration and evaluation assets 10,591 10,703
Right-of-use assets 694 498
Total non-current assets 66,426 67,233
Current assets
Restricted cash 1,192 1,171
Trade and other receivables 5,727 8,137
Product inventory 1,009 698
Cash and cash equivalents 1,269 1,335
Total current assets 9,197 11,341
Total assets 75,623 78,574
Equity
Share capital 401,426 401,426
Share-based payment reserve 25,108 25,560
Treasury shares - (458)
Accumulated deficit (402,001) (399,378)
Cumulative translation reserve (3,372) (3,372)
Total equity 21,161 23,778
Liabilities
Non-current liabilities
Decommissioning provision 25,651 24,004
Deferred tax liability 12,523 12,125
Lease liabilities 592 424
Other provisions 1,317 1,317
Total non-current liabilities 40,083 37,870
Current liabilities
Current portion of decommissioning provision 6,938 6,720
Current portion of lease liabilities 198 137
Accounts payable and accrued liabilities 7,243 10,069
Total current liabilities 14,379 16,926
Total liabilities 54,462 54,796
Total liabilities and equity 75,623 78,574
The accompanying notes on pages 13 to 14 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
Loss for the period - - - (4,559) - (4,559)
Other comprehensive loss for the period - - - - (70) (70)
Total comprehensive loss for the period - - - (4,559) (70) (4,629)
Transactions with equity owners
Share-based payment expense - 3 - - - 3
Shares purchased to be held in Treasury - - (3) - - (3)
Balance at 30 September 2023 401,426 25,560 (458) (390,915) (3,442) 32,171
Balance at 31 December 2023 401,426 25,560 (458) (399,378) (3,372) 23,778
Comprehensive loss for the period - - - (2,623) - (2,623)
Other comprehensive loss for the period - - - - - -
Total comprehensive loss for the period - - - (2,623) - (2,623)
Transactions with equity owners
Share-based payment expense - (452) 458 - - 6
Shares purchased to be held in Treasury - - - - - -
Balance at 30 September 2024 401,426 25,108 - (402,001) (3,372) 21,161
The accompanying notes on pages 13 to 14 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)
Nine months ended 30 September
Note 2024 2023
Operating activities
Income (loss) for the period (2,623) (4,559)
Items not involving cash:
Depletion and depreciation 2,587 3,432
Share-based payment expense 6 3
Tax expense 1,120 1,112
Accretion expense on decommissioning provision 1,261 1,272
Foreign exchange loss (gain) 127 (20)
Gain on disposition (37) -
Other income 45 (25)
Decommissioning provision recovery 9 (36)
Income taxes paid (552) -
Funds from operations 1,943 1,179
Changes in non-cash working capital 5 (1,113) 518
Cashflows from operating activities 830 1,697
Financing activities
Lease payments (273) (12)
Shares purchased to be held in treasury - (194)
Cashflows used in financing activities (273) (206)
Investing activities
Capital expenditures 5 (602) (4,925)
Cashflows used in investing activities (602) (4,925)
Impact of foreign currency translation on cash (21) 39
Change in cash and cash equivalents (66) (3,395)
Cash and cash equivalents, beginning of period 1,335 4,854
Cash and cash equivalents, end of period 1,269 1,459
The accompanying notes on pages 13 to 14 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 nine months ended 30 September 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.
While the financial figures included within these condensed consolidated
interim financial statements have been computed in accordance with IFRS's
applicable to interim periods, this report and financial statements do not
contain sufficient information to constitute an interim financial report as
set out in IAS34 Interim Financial Reporting.
4. Earnings per share
Nine months ended 30 September
($000's, except per share amounts) 2024 2023
Income (loss) for the period (2,623) (4,559)
Weighted average shares outstanding:
Basic 114,888 113,097
Diluted 114,888 113,097
Income per share - Basic and diluted (0.02) (0.04)
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.
5. Supplemental cash flow disclosure
Nine months ended 30 September
2024 2023
Cash provided by (used in):
Trade and other receivables 2,446 (845)
Product inventory (258) (43)
Accounts payable and accrued liabilities (3,213) 1,403
Restricted cash (88) 3
Changes in non-cash working capital from operating activities (1,113) 518
The following table reconciles capital expenditures to the cash flow
statement:
Nine months ended 30 September
2024 2023
PP&E additions 880 5,313
E&E additions - -
Total capital additions 880 5,313
Changes in non-cash working capital from investing activities (278) (388)
Total capital expenditures 602 4,925
1 (#_ftnref1) 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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