Serica Energy (SQZ) AGM 2024 presentation summary

Leadership and strategy

• Interim CEO Dave Latin and CFO Martin Copeland bring extensive industry and M&A experience, with recent leadership changes and a focus on refreshed executive capabilities.

• The company is pursuing a new phase of growth, leveraging strong financial resources and expanding its M&A reach beyond the UK Continental Shelf.

• A clear M&A strategy prioritizes value accretion, conservative financing, and opportunities for further investment, supported by a highly experienced internal team.

Operational performance and growth

• Production increased to 40.1 kboe/d in 2023, up from 26.2 kboe/d in 2022, driven by the Tailwind acquisition and successful well interventions.

• 2P reserves reached 140 mmboe at the end of 2023, with a 179% reserves replacement ratio and significant upward revisions from infill drilling and development projects.

• 2024 production guidance is 41-46 kboe/d, with ongoing well campaigns and new production expected from the Bittern and Belinda fields.

Financial results and shareholder returns

• FY 2023 EBITDAX was £381 million, with profit before tax of £306 million and net income of £103 million, despite lower commodity prices.

• Operating costs rose to ~$19/boe due to inflation and shutdown overruns, but the balance sheet remains strong with £302 million in cash and a new $525 million RBL facility.

• Over £200 million in dividends have been paid or proposed to date, with a 2023 final dividend of 14p/share and a £15 million share buyback completed in 2024.