Capricorn Energy optimistic after 'pivotal' year

(Sharecast News) - Capricorn Energy said on Thursday that 2024 had been a "pivotal" year for the oil and gas producer, with crucial negotiations with the Egyptian authorities on track to conclude in the coming months. The London-listed, Egyptian-focused firm said that along with operating partner Cheiron Oil and Gas, it had made "good" progress towards consolidating its eight concession agreements in the country into a single, integrated agreement.

It said the process was expected to conclude in the current year, ahead of final approval by the Egyptian authorities.

A new agreement would support increase production and strengthen returns, it noted.

The update came as Capricorn posted full-year production of 23,763 barrels of equivalent per day, down on last year's 30,044 boepd but at the upper end of internal guidance.

Revenues from production were $147m, down on the previous year's $200m, compounded by an easing in the average price per barrel, to $79.3 from $81.2.

Debt stood at $100m as at 31 December 2024, and cash at $132m. Profits from discounted operations were $23m, while losses from continuing operations were $12m.

Randy Neely, chief executive, said: "2024 was a pivotal year for Capricorn, during which we continued to improve the operational performance of the Egyptian business and continued our culture of financial discipline, which helped the company achieve the upper end of production guidance.

"Growth and diversification of operations and cash flows will be a key focus for 2025. Our goal is to ultimately deliver consistent shareholder returns, and we are evaluating M&A opportunities in the UK North Sea and MENA region, through a strict set of financial and strategic criteria, to facilitate this."

James Hosie, analyst at Shore Capital, said: "[Capricorn's] results statement is essentially a progress report while the business sits at a critical point in management's business plan to unlock value.

"In this context, the most noteworthy point is that discussion with the Egyptian authorities to consolidate and extend eight of its concession agreements under improved terms remain on track to complete during the 2025 full-year.

"Once confirmed, Capricorn should be able to outline a plan for reserves and production growth."

As at 0830 GMT, shares in Capricorn were trading 5% lower at 244.0p.