Seplat Petroleum Development Company Plc Standard Bank Africa Investors Conference Resilience and Strength 23 JUNE 2020 2019 FULL YEAR RESULTS 1
NIGERIA’S LEADING INDEPENDENT OIL & GAS PRODUCER SEPLAT DELIVERED SIGNIFICANT STRATEGIC, OPERATIONAL AND FINANCIAL ACHIEVEMENTS IN Q1 2020 KEY FIGURES ACHIEVE VED IN Q1 2020 • 48,491 boepd total Working interest • Liquids 33,388 bopd production • Gas 88 MMscfd VOLUMES Avg. daily 48,491 boepd • Revenue of US$130m Balance sheet • US$336m cash at bank remains strong • US$65m operating cash flow • Gas revenues of $23.1 million were 18% of LOSS Group revenue, de-coupled from oil price Gas performance • Gas revenues down owing to lower realised US$106m prices and lower gas volumes sold after $146m IAS 36 impairment • $46m invested in Q1 2020 Capex reduced • Pre-drilling costs for two development wells according to • FY20 - $120m capex projected, to include two market conditions gas wells and infrastructure CASH AT BANK • 0 fatalities Strong safety • $336m 0 LTI record • 4 Major injury incidents 2019 FULL YEAR RESULTS 2
A DIVERSIFIED AND RESILIENT PLATFORM SEPLAT IS DIVERSIFYING AND RERISKING ITS BUSINESS TO ACHIEVE SUSTAINABLE COMPETITIVE ADVANTAGE ASSURING INCREASING GAS PRUDENT CAPITAL BUSINESS OIL REVENUES EXPORT ROUTES DIVERSIFICATION ALLOCATION RESILIENCE • Operate mature, • Imminent Amukpe- • Increasing • Flexible capex can be • Significant cash de-risked fields Escravos pipeline contribution of gas dialled up or down to balance available significantly to Group revenue align with prevailing • Addition of Eland • Limited debt servicing de-risks exports from and profitability conditions and future OML 40 adds in 2020 & 2021 OMLs 4,38 & 41 needs • Gas prices not linked production and • Hedged 1.5MMbbls • Mostly buried • Focus on highest- export routes not to oil price, reducing per quarter at $45 dependent on pipeline will reduce volatility of Group return prospects for Q1-Q3 2020 Trans Forcados losses from vandalism cash flows • Well-managed • Low unit cost pipeline • Potential for offshore • Gas pipelines less balance sheet, production $7.70/boe • Increased focus on FPSO / FSO route prone to damage not over-levered in Q1 2020 improving uptime linking Amukpe- • High drop-through • Solid credit rating, • Low breakeven Escravos to OML 40 • Drilling programme of cash from gas able to tap markets enables profitability export route, to focused on high- revenues when appropriate at lower oil prices reduce handling return wells. • Massive opportunity charges and losses • Business continuity for Oben and ANOH plan successfully in to serve growing operation domestic market 2019 FULL YEAR RESULTS 3 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE
Q1 2020 FINANCIAL HIGHLIGHTS SOLID PERFORMANCE AGAINST CHALLENGING CONDITIONS Loss after IAS 36 impairment Cash generation NPDC receivables $107 million $65 million $207 million (before deferred tax) (Cash flow from operations) 426% 19% 7% Q1 2019: $79 million Q1 2019: $33 million 12M 2019: $222 million Gross debt Low operating costs Capital investment $7.70/boe $46 million $794 million (Production opex) 24% 188% 0.6% Q1 2019: $6.20/boe FY 2019: $789 million Q1 2019: $16 million Net debt position Gas 18% of Group sales $458 million $23 million 45% 30% 0.4% Q1 2019: $142 million FY 2019: $456 million 2019 FULL YEAR RESULTS 4 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE
FINANCIAL RESULTS A PROFITABLE BUSINESS WITH STRONG CASH GENERATION AND A ROBUST BALANCE SHEET $ million 3M 2020 3M 2019 Change Gross oil Sales 107.4 117.8 (8.8%) • Revenues reflect lower realised oil prices Gas sales 23.1 41.8 (44.7%) Total revenue 130.5 159.5 (18.2%) • Eland oil and gas was acquired and consolidated as part of the Group leading to an increase in O&M expenses, crude handling charges, Royalties and DD&A Cost of sales (97.4) (78.1) 24.7% charges 33.1 81.4 (59.4% Gross profit • 32.0 (20.4) 56.5% G&A IAS 36 impairment adjustment of $146m was primarily due to a revaluation of the asset triggered by a fall in global oil prices (145.5) 0.1 - Impairment of Assets 48.1 (16.4) (394%) Other • Decreased operating profit driven by impairment losses recognised on Company assets (77.0) 32.5 (337%) Operating profit (20.3) (13.1) 55.1% Net finance costs • Other income/gain primarily consisting of $19m fair value gain on hedge as well Share of JV Profit 1.6 - - as a $46m underliftposition 35.8 (396%) Profit before deferred tax (105.8) • $2m share of JV profit based on a 50% equity investment in AGPC (10.8) (13.1) 55.1% Tax expense Profit after tax (106.6) 32.7 (426%) • Capex includes drilling costs in relation to three development wells and facility upgrades (45.9) (15.9) 188% Capex incurred 64.5 79.5 (18.9%) Cash flow from operations • Tax expense was recognized for income taxes payable in future periods with respect to taxable temporary differences 207.3 222.0 NPDC receivables • $207m NPDC receivables due outstanding cash calls 336.0 333.0 Cash and bank balance 2019 FULL YEAR RESULTS 5 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE
CASH RECONCILIATION STRONG FREE CASH FLOW AND DILIGENT MANAGEMENT OF GROUP LIQUIDITY $ million 600 Hedging strategy aimed at providing cash flow assurance Q1 – Q3 2020 hedging: 1.5 MMbbls/quarter 500 at US$45/bbl 10 1 65 400 26 329 326 46 1 300 200 100 0 Cash at 31/12/19 Cash from Interest received Proceeds from Interest paid on PP&E FX differences Cash at 31/03/20 (inc. restricted operations from Fixed Deposits loans loans, finance (inc. restricted cash) charges etc cash) 2019 FULL YEAR RESULTS 6 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE
PRUDENT FINANCIAL MANAGEMENT SEPLAT’S FLEXIBILITY TO SCALE INVESTMENT UP OR DOWN HELPED IT NAVIGATE PREVIOUS CHALLENGES INCREASING GAS VOLUMES DIVERSIFY BUSINESS SUCCESSFUL CASH MANAGEMENT STRATEGY Gross debt ($m) Cash ($m) 49,867 $900 50,000 46,498 $900 $259m OML 43,372 $789 Oil Gas $800 53 acquisition 36,923 $664 40,000 $457m Eland $700 24,198 14,369 $588 acquisition $585 22,563 $570 30,823 $600 28,341 30,000 25,877 6,571 19,070 $500 4,867 $333 $326 $400 $310 $446 $285 20,000 $437 15,786 $300 Higher 29,003 $169 $160 25,669 24,252 23,474 23,935 cash level $200 10,000 17,853 than $100 10,091 2014-16 - $0 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 Ave. Brent price ($) ($108.6) ($99.0) ($53.0) ($45.1) ($54.7) ($71.3) ($64.0) RISING GAS REVENUES REDUCE EXPOSURE TO OIL PRICE FLEXIBILITY WITH CAPITAL EXPENDITURE $350 $1,000 2% $120m capex 4% Oil Gas $300 planned for 2020 21% $18.1 $800 ($46m spent in Q1) 29% $250 $27.4 13% $155.6 $600 $202.6 $200 28% $77.0 321 $150 $862.1 $400 $124.0 $747.6 41% $100 $590.5 $493.5 $495.1 152 125 $200 $105.5 120 $50 $318.2 88 52 33 $148.8 $0 $0 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 Oil price crisis Trans Forcados force majeure 2019 FULL YEAR RESULTS 7 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE (Jul 14 – Jan 16) (Feb 16 – Jun 17)
ROBUST CAPITAL STRUCTURE SEPLAT IS IN A POSITION OF FINANCIAL STRENGTH AND WELL-FUNDED TO CAPITALISE ON OPPORTUNITIES • Capital structure amended following acquisition of Eland Oil & Gas PLC NET DEBT POSITION REFLECTS CASH ACQUISITION OF ELAND • Eland RBL now part of structure • $300m Seplat RCF upsized to $350m and extended to 2022/23 $900 Gross debt US$ million 800 Cash balance US$ million $789 KEY TERMS 600 $664 $585 Pricing Tenor $ … 400 Notes 2023 $446 $437 9.25% $326 $333 LIBOR+6% falling to LIBOR+5% after RCF 2022/23 200 Amukpe-Escravos opens $160 Eland 2023 0 LIBOR+8% / LIBOR+7% if <50% drawn down RBL Year end 2015 2016 2017 2018 2019 DIVERSE CAPITAL STRUCTURE CURRENT DEBT MATURITY PROFILE (US$ MILLION) $400 $400 Debt facilities $350 $350 US$ million Senior notes RCF RBL $350 $350 $300 $300 $250 $250 $200 $200 $150 $150 $98 $100 $100 $50 $50 $0 $0 2020 2021 2022 2023 Notes RCF RBL Note: maturity profile assumes no bon d refin ancing; if bond is refinanced, RCF matu rity automatically extends to December 2023 2019 FULL YEAR RESULTS 8 BANK OF AMERICA 2020 EMERGING MARKETS DEBT & EQUITY CONFERENCE
Recommend
More recommend
