Full-year results for Hurricane Energy (HUR) arrived with no real surprises, but fresh assurance that the hydrocarbon explorer will "soon be generating the long-term production data" required to fully develop the Lancaster field.
From an investor’s perspective, that data will be accompanied by a barrage of news. Following the hook-up of the Aoka Mizu production and storage vessel in mid-March, final commissioning of the early production system is under way, and first oil is expected within the next three months.
Barring any hiccups, management then expects a steady six-month ramp-up in output to 17,000 barrels of oil per day, which should produce not only data, but a lot of cash. Indeed, against a $60 (£46) a barrel oil price, Hurricane expects the pilot field to be generating more than $200m in annual operating cash flow at 85 per cent of production capacity.
Around the same time, drilling at the first of three wells financed by the Spirit Energy farm-in should begin, which Hurricane ambitiously hopes will result in first oil from a tie-back to the Aoka Mizu in 2020.
For 2019, analyst EPS estimates range between 4¢ and $3.89, with a consensus forecast of $1.28.
| HURRICANE ENERGY (HUR) | ||||
| ORD PRICE: | 47p | MARKET VALUE: | £923m | |
| TOUCH: | 46.9-47.2p | 12-MONTH HIGH: | 61p | LOW: 32p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 32¢* | NET DEBT: | 27% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2014 | nil | -14.9 | -2.4 | nil |
| 2015 | nil | -8.4 | -1.3 | nil |
| 2016 | nil | -6.4 | 0.1 | nil |
| 2017 | nil | -7.0 | -0.5 | nil |
| 2018 | nil | -60.9 | -3.1 | nil |
| % change | - | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of $132m, or 6.7¢ a share £1=$1.32 | ||||
