UK: Serica Energy announces results for the six months ended 30 June 2025

AIM-listed Serica Energy, a British independent upstream oil and gas company with operations in the UK North Sea, has announced its unaudited financial results for the six months ended 30 June 2025. 

Chris Cox, Serica's CEO, stated:

'Serica has felt like a coiled spring in the first half of 2025. The resilience of our gas production from the Bruce Hub and strong Q1 gas prices, coupled with a robust contribution from our other producing assets, helped deliver a creditable financial performance despite the downtime at the Triton FPSO. With the ramp up from Triton progressing, we should soon return to production levels of around 50,000 boepd, with more to come as new wells at Guillemot and Evelyn come onstream. Optimisation work by the Serica team at the Bruce Hub is also beginning to deliver results, and will boost production in the second half of the year.

We continue to make progress on advancing future production opportunities. Subsea tie-in work on Belinda is progressing well, and this new field will come onstream at the start of 2026. As we plan future drilling programmes across our wider asset base, we will look to replicate the success of the five well drilling campaign at Triton. This achieved tremendous subsurface results that are of material size to Serica, and was delivered ahead of schedule and under budget. Our future drilling plans have the potential to offset natural field declines into the next decade.

The expected increase in production compared to the last 12 months is set to provide material cash generation, funding organic growth and sustained dividends while we continue to seek to create shareholder value through disciplined M&A.'

Results summary ($ million unless stated)

Highlights

Positive subsurface performance set to boost production

• Production of 24,700 boepd net to Serica in H1 2025 (H1 2024: 43,700 boepd), impacted materially by the shut-in of the Triton FPSO from 28 January to the end of the period
• Work to increase production from the Bruce Hub is starting to deliver results, with well optimisation work and the resumption of production at Keith leading to an increase in production post-period end, which averaged 21,600 boepd in July compared to 16,700 boepd in H1 2025
• The completion of the BE01 well on the Belinda field (Serica 100%), which delivered rates of 7,500 boepd on test, brought to an end the highly successful five well drilling programme at Triton
  • All five wells delivered positive results which met or exceeded pre-drill estimates
  • The programme was delivered 25 days ahead of schedule and c.$31 million net to Serica under budget

Cash position remains robust, providing optionality over capital allocation

• Cash of $174 million (31 December 2024: $148 million), an increase since year end 2024 despite the ongoing capital expenditure programme and no production from Triton since January
  • Cash was boosted by the receipt of the $71 million cash tax refund in June 2025, the result of Group relief in 2024 leading to an overpayment of cash tax in 2024 under the Instalment Payment Regulations
  • Capital expenditure on a cash basis of $138 million in H1, as work continued on the Triton drilling campaign
• Net debt reduced by $26 million in the period to $57 million
• Strong financial capacity maintained with the redetermination of Reserves Based Lending facility ('RBL') completed in June, with the Borrowing Base set at $490 million, of which $231 million is drawn down
  • Liquidity of $433 million as at 1 July 2025
• Interim dividend of 6p declared today (2024 interim dividend: 9p), in line with the previously announced rebalancing of the final dividend
  • The interim dividend is payable on 20 November 2025 to shareholders registered on 24 October 2025, with an ex-dividend date of 23 October 2025

Organic growth potential, actively exploring value-accretive M&A

• Serica's low net debt and robust liquidity position underpins the Company's continued ability to make targeted organic growth investments and to remain both competitive and opportunistic in M&A
• Serica continues to progress plans to convert material 2C resources into reserves, should the appropriate fiscal and regulatory environment allow
  • Following the identification of over 20 potential infill targets around the Bruce Hub, considerable further work and planning has been undertaken with a high-graded list of optimal targets being matured for a possible future drilling campaign
  • The Company continues to aim for FID of the Kyle redevelopment (Serica 100%) in H1 2026 Front-end design work tenders have been issued and the procurement of long lead items is underway
  •  A Request for Information has been sent out for a semi-submersible rig to carry out a potential drilling campaign across Bruce and Kyle
• Serica continues to analyse multiple M&A opportunities, largely focused on the UK North Sea

 Outlook and guidance - material cash generation expected

• Production in the second half of 2025 is expected to be materially higher than H1, due to significantly increased Triton FPSO uptime, contribution from new wells at Triton, and the continuation of the production increase following the reinstatement of low-pressure wells at the Bruce Hub
• Production guidance for FY 2025 of 33,000-35,000 boepd
• Capital expenditure expected to be around the top end of the $220-250 million range given the relative strength of Sterling against the US Dollar, and work to progress Belinda towards production at the start of 2026 moving forward at pace, accelerating spend from 2026 into 2025
• Opex guidance unchanged at c.$330 million
• Work is progressing well regarding the move from the AIM to the Main Market of the London Stock Exchange early in Q4 2025

Original announcement link

Source: Serica Energy