Seplat Energy grows 2023 Q1 PBT by 3.2% to N39.5bn

…Q1 Gross profit hits N91.1bn, rising by 69%

Seplat Energy Plc, a leading Nigerian independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, has announced its unaudited results for the three months ended 31 March 2023, recording a rise in profit before tax by 3.2 per cent to N39.5bn from N34.7bn year-on-year. The company also reported that its core annual dividend target has been raised by 20 per cent to US 12 cents; declaring a Q1 dividend payout of US 3 cents per share.

The energy Company’s also grew its Q1 revenue by 36.9 per cent to N152bn from N100.6bn year-on-year, driven by higher production volumes; as its gross profit for the period soars to N91.1bn from N48.8bn year-on-year, rising by 69 per cent.

Seplat Energy recorded a strong Q1 cash generation of $139.9 million and capex of $44.7 million; with Balance Sheet strengthened with $459.7 million cash at bank, net debt down to $288.2 million ($130 million MPNU cash deposit not included).

In its operations, Seplat Energy’s working interest production increased by 8.6 per cent to 51,720 boepd, in upper half of guidance range for the period. The Amukpe-Escravos Pipeline (AEP) is supporting higher export volumes from key Western Assets. The new OP-15 well is boosting liquids production at OML 40, with Oben-34 well boosting gas production.

The Company achieved more than 3.8 million hours without Lost Time Injury (LTI) at Seplat-operated assets in Q1. Full-year guidance is retained at 45-55 kboepd, and Carbon intensity figure stands at 26.4kg/boe.

Financial highlights

• Revenues up 37 per cent to $331.0 million (including overlift of $75.4 million), driven by higher production volumes
• Strong cash generation of $139.9 million, capex of $44.7 million
• Balance sheet strengthened with $459.7 million cash at bank, net debt down to $288.2 million ($130 million MPNU cash deposit not included)
• Unit production opex of $9.0/boe
• Average realised oil price of $82.32/bbl
• Average realised gas price climbed to $2.88/Mscf following price renegotiation with clients leading to upward price adjustments.

Operational highlights

• Working interest production increased by 8.6 per cent to 51,720 boepd, in upper half of guidance range
• Amukpe-Escravos Pipeline (AEP) supporting higher export volumes from key Western Assets
• New OP-15 well boosting liquids production at OML 40, with Oben-34 well boosting gas production
• Achieved more than 3.8 million hours without Lost Time Injury (LTI) at Seplat-operated assets
• Full-year guidance retained at 45-55 kboepd
• Carbon intensity figure of 26.4kg/boe

Corporate updates

• Core annual dividend target raised by 20 per cent to US 12 cents; Q1 dividend declared of US 3 cents per share
• Applications submitted for conversion of Oil Mining Leases under the new PIA regime
• The Company announced its Board of Directors’ Succession Forward Plan on 25 April 2023.

Update on proposed acquisition of Mobil Producing Nigeria Unlimited (MPNU)

• We remain confident that the proposed acquisition will be brought to a successful conclusion and continue to engage with all relevant parties.

Commenting on the impressive results, Mr. Basil Omiyi, Independent Chairman, said,  “Seplat Energy’s management and staff have once again delivered excellent performance, with production volumes up, unit production cost down and strong cash generation enabling the Board to increase our annual core dividend target from US 10 cents to US 12 cents per share, paid in equal quarterly dividends. As a result, we have declared a Q1 2023 dividend of US 3 cents per share.

“The year has started strongly, and we are now seeing the benefits of the AEP, through which we are exporting significant amounts of oil. On the ANOH gas plant, our partners have made good progress in the quarter on delivering the OB3 and Spur pipelines, as well as the necessary gas wells, and we maintain Q4 2023 for first gas. We continue to engage with all relevant parties in the proposed acquisition of MPNU and are confident of a successful outcome.

“I wish to thank all our staff for remaining focused on delivering this strong performance, united in their support of Seplat’s management team, against a backdrop of unnecessary distractions that will not derail our progress and ambition to become Nigeria’s leading energy supplier.

“The Board announced its Succession Forward Plan earlier this month and I look forward to steering this national energy champion in my final year as Chairman, fully resolved to implement the strong corporate governance that will enable Seplat Energy to grow and achieve its ambition to create a sustainable business that maximises returns for all stakeholders, while delivering an energy transition that drives social and economic benefits for all Nigerians.”