Serinus Energy strong production transforms cash flow base says Arden analyst

Serinus Energy

Serinus Energy plc (LON:SENX) is the topic of conversation when Arden Partners Analyst Daniel Slater CFA caught up with DirectorsTalk for an exclusive interview.

Q1: Serinus Energy published FY2019 results earlier this year, what did you consider to be the key highlights?

A1: The main takeaway for us was the strong rise in production and cash flows driven by the Moftinu gas plant in Romania coming onstream in April 2019. This has transformed the company’s cash flow base, which should stand Serinus in good stead for funding forward work programmes in the coming years.

Q2: The company shortly after announced the receipt of a formal covenant waiver, what did you conclude from this?

A2: The additional covenant waiver helps show the support of lender the EBRD, and Serinus is in ongoing discussions here aimed at addressing the next debt payment due at the end of June 2020. We await further news here.

Now more recently Serinus provided Q1 results, how did they compare with your expectations from the FY results and did you have to adjust your forecasts in anyway?

Production in Q1 was very strong, benefiting from the new Moftinu-1004 production well in Romania coming onstream. Nevertheless, falls in oil and gas prices due to the coronavirus pandemic weighed on cash flows, and we adjusted our full year forecasts to allow for this going forward. As such, Serinus is well placed to benefit from the ongoing recovery in oil and gas prices, and we continue to await further updates on the EBRD discussions and around the forward work programme.

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Serinus Energy plc is an international oil company with operations in Romania and Tunisia. The focus of the Company is to enhance shareholder value by growing oil and gas production through the efficient allocation of capital.

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