Nigeria’s Seplat Petroleum (SEPL) had a good 2018. After several years of weak oil and gas prices and operational disruption, the joint Lagos- and London-listed stock met its production targets, saw operating profit almost triple to $310m (£236m), refinanced its capital base, and restarted dividend payments. Less than three months into 2019, and a revolving credit facility has been completely retired, and the ANOG gas project has been sanctioned.
Much of this shift has hinged on a return to normalcy at the Forcados pipeline, which transports oil and gas from Seplat’s fields in the Niger Delta to the coast. The network was hit by a force majeure in 2017, but uptime rose to 85 per cent last year, and the overdue payments from the state-owned Nigerian Petroleum Development Company were eventually cleared.
Even the largesse Seplat normally extends to its lawyers and bankers softened, as professional and consulting fees fell two-fifths to $12.9m. General and administrative costs dropped even further, from $24.1m to $12.8m.
S&P Capital IQ consensus estimates are for earnings of 16.6¢ a share this year, rising to 44¢ in 2020.
| SEPLAT PETROLEUM (SEPL) | ||||
| ORD PRICE: | 126p | MARKET VALUE: | £741m | |
| TOUCH: | 126-129p | 12-MONTH HIGH: | 160p | LOW: 110p |
| DIVIDEND YIELD: | 9.1% | PE RATIO: | 6 | |
| NET ASSET VALUE: | 276¢ | NET CASH: | $135m | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2014 | 775 | 252 | 50 | nil |
| 2015 | 570 | 87.1 | 12 | nil |
| 2016 | 254 | -173 | -29 | nil |
| 2017 | 452 | 44.0 | 47 | nil |
| 2018 | 746 | 263 | 26 | 15* |
| % change | +65 | +499 | -45 | - |
| Ex-div: | 19 Mar | |||
| Payment: | 23 May | |||
| £1=$1.31. *Includes Q1 and Q3 half-year distributions of 5¢ a share, and a final dividend of 5¢. | ||||
