EnQuest PLC: Results for the year ended 31 December 2021

2022-03-24 08:01:00

EnQuest PLC

Results for the year ended 31 December 2021 and 2022 outlook

24 March 2022

Unless otherwise stated, all figures are on a Business performance basis and are in US Dollars.

Comparative figures for the Income Statement relate to the period ended 31 December 2020 and the Balance Sheet as at 31 December 2020. Alternative performance measures are reconciled within the `Glossary - Non-GAAP measures' at the end of the Financial Statements.

EnQuest Chief Executive, Amjad Bseisu, said:

"We made good progress against our strategic objectives in 2021, concluding three acquisitions, refinancing our senior secured debt facility, generating significant free cash flow of $396.8 million and reducing our year end net debt to $1,222.0 million, its lowest level since 2014. We have made strong progress on emissions reduction, which continues to be a focus for the Group.

"We have also started 2022 well, with production to the end of February averaging 50,408 Boepd, towards the top end of our full year guidance range. We have also continued to reduce our net debt, down to $1,090.0 million at the end of February, in line with our strategic priorities. With a supportive oil price environment and an active programme of nine wells and seven workovers in 2022, our largest sanctioned programme since 2014 and our first new wells in over two years, we remain confident on delivering a good performance this year.

"The acquisition of Golden Eagle has strengthened our portfolio, building on our track record of value creation through innovative, disciplined M&A. The acquisitions of Bressay and Bentley have added almost 250 MMboe of 2C resources, adding to those already in place at Magnus, Kraken, PM8/Seligi and PM409, providing EnQuest with longer-term potential development opportunities.

"We remain focused on continuing to reduce our net debt while selectively investing in our low-cost, quick payback well portfolio in order to sustain our production base.

"EnQuest's business is strongly positioned to play an important role in the energy transition. We will do so by responsibly optimising production, leveraging existing infrastructure, delivering decommissioning and exploring new energy and decarbonisation opportunities."

2021 performance

∙ Group net production averaged 44,415 Boepd1 (2020: 59,116 Boepd)
∙ Revenue and other operating income of $1,320.3 million (2020: $855.1
million) and adjusted EBITDA of $742.9 million (2020: $550.6 million)
reflects materially higher oil prices, partially offset by lower production
∙ Cash generated from operations was $756.9 million (2020: $567.2 million)
∙ Cash expenditures of $117.6 million (2020: $173.0 million); cash capital
expenditure of $51.8 million (2020: $131.4 million) and cash abandonment
expenditure of $65.8 million (2020: $41.6 million)
∙ Strong free cash flow generation2 of $396.8 million (2020: $210.5 million)
∙ Cash and available facilities amounted to $318.7 million at 31 December
2021 (2020: $284.1 million), with net debt reduced to $1,222.0 million
(2020: $1,279.7 million)
∙ Statutory reported profit after tax was $377.0 million (2020 (restated):
loss after tax of $469.9 million)

1 Includes Golden Eagle contribution for the period 22 October to 31 December, averaged over the 12 months to the end of December

2 Net change in cash and cash equivalents less net (repayments)/proceeds from loan facilities, acquisition costs ($258.6 million), the accelerated repayment of the BP vendor loan ($58.7 million) and net proceeds from the firm placing, placing and open offer ($47.2 million)

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