Harbour Energy has announced its unaudited half-year results for the six months ended 30 June 2024.
Highlights(1)
Solid operational delivery
- Production of 159 kboepd (H1 2023: 196 kboepd), split broadly equally between liquids and gas
- Continued strong safety record with TRIR of 0.7 per million hours worked (H1 2023: 0.8)
- Harbour-operated UK capital projects, including Talbot, on track to significantly increase production in Q4
- Further exploration success in Indonesia with the significant Tangkulo discovery; Layaran appraisal drilling underway
- Strategic investment opportunities Zama (Mexico) and Viking CCS (UK) progressing through FEED
Financial performance in line with expectations
- Revenue of $1.9bn (H1 2023: $2.0bn) and EBITDAX of $1.2bn (H1 2023: $1.4bn)
- Profit before tax of $0.4bn (H1 2023: $0.4bn); profit after tax of $0.1bn (H1 2023: loss of $8m) with an effective tax rate of c.85% reflecting Harbour's current UK concentration
- Free cash flow of $0.4bn (H1 2023: $1.0bn), after $0.1bn of acquisition-related fees, resulting in a small net cash position at period end
- Declared $100m (13 cents per share) interim dividend, in line with $200m annual dividend policy and representing 8% dividend per share growth year-on-year
Improved 2024 production guidance with outlook for 2025 reiterated
- Production guidance narrowed to 155-165 kboepd (from 150-165 kboepd), reflecting good progress on our capital projects and planned maintenance shutdowns
- Unit operating cost and total capital expenditure guidance reiterated at c.$18/boe and c.$1.2bn, respectively
- At $85/bbl Brent, 70 pence/therm UK NBP, expectation to be marginally free cash flow positive for the full year unchanged with current estimate of $100m-$200m
- In line with prior guidance, 2025 free cash flow expected to be significantly higher versus 2024 reflecting similar levels of production and operating costs but materially lower capital expenditure
Targeting early Q4 2024 for completion of Wintershall Dea portfolio acquisition
- Financing workstreams substantially completed, including the voluntary bondholder consent process relating to the porting of the $4.9bn investment grade bonds and the syndication of the $3bn RCF and $1.5bn bridge facility
- Prospectus and shareholder circular published; Harbour shareholder approval received with 99.99% of votes in favour of the acquisition
- Regulatory, anti-trust and foreign direct investment (FDI) approvals progressing as planned including, post period end, receipt of UK FDI approval and UK regulatory consent from the NSTA
- Acquisition now on track to complete in early Q4 2024
Linda Z Cook, Chief Executive Officer, commented:
'During the first half of 2024 we maintained our focus on safe operations, maximising the value of our existing portfolio and advancing our organic growth projects. At the same time, we made significant progress towards completing the Wintershall Dea acquisition, which is now expected early in the fourth quarter.
The acquisition will transform the scale, geographical diversity and longevity of our portfolio and strengthen our capital structure enabling us to deliver enhanced shareholder returns over the long run while also positioning us for further opportunities.'
(1) All operational and financial highlights, guidance and outlook exclude the impacts of the announced Wintershall DEA asset portfolio acquisition and any fees relating to the acquisition as well as the recently proposed changes to the UK Energy Profits Levy, unless stated otherwise.
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Source: Harbour Energy
