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Highlights
- Revenue and Production Decline: Kistos PLC reported a 13% drop in first-half revenue to $113.33 million due to reduced production and a significant fall in gas prices, with average production falling to 8,400 boepd.
- EBITDA and Debt: Adjusted EBITDA declined 34% to $48.59 million, while Kistos ended the period with $72 million in cash and $175 million in net debt, reflecting challenges from lower gas sales prices.
- Acquisitions and Delays: Kistos completed the acquisition of UK gas storage assets and maintained its production guidance, though the 'first oil' timeline for its Balder Future project was delayed to Q2 2025.
Kistos PLC released its interim results, reporting a 13% decline in first-half revenue due to lower production and decreased overall gas prices. For the six months ending June 30, 2023, Kistos generated $113.33 million in revenue, compared to $129.72 million during the same period last year.
The company’s production, sourced from operations in Norway, the Netherlands, and the UK, averaged 8,400 barrels of oil equivalent per day (boepd), a drop from 9,200 boepd the previous year. While the realized oil price increased by 8% to $82 per barrel, Kistos faced a significant 33% reduction in gas sales prices, translating to $54 per barrel on an oil equivalent basis. This drop in gas prices had a notable impact on the company’s earnings.
Earnings before interest, tax, depreciation, and amortization (adjusted EBITDA) declined by 34% year-on-year, totaling $48.59 million, reflecting the combined effect of lower production and the fall in gas prices.
At the end of the reporting period, Kistos held $72 million in cash, while its net debt stood at $175 million. The company also completed the acquisition of EDF’s Hill Top Farm and Hole House gas storage assets in the UK for £25 million during the first half of the year. These acquisitions are part of Kistos’ ongoing strategy to enhance its asset portfolio and bolster its future growth potential.
Kistos retained its full-year production guidance of between 7,500 and 8,500 boepd despite the challenges. However, the timeline for ‘first oil’ from the company’s Balder Future project in the North Sea has been delayed from the original late 2024 target to the second quarter of 2025, due to operational delays.
Andrew Austin, Kistos’ chief executive, highlighted that the company remains focused on both operational performance and pursuing new growth opportunities. “The priority remains operational delivery while identifying inorganic growth opportunities,” Austin said, stressing that any potential transaction must offer substantial near-term value creation and maintain an acceptable risk profile.
He also reaffirmed that Kistos’ strategy to secure acquisitions at favorable terms has been validated by the protections put in place around the Balder Future project, shielding stakeholders from additional costs while preserving potential upside.
