Genel Energy PLC (LSE:GENL, OTC:GEGYY) saw its revenue, earnings and cash flow transformed in the first half of 2022 amidst soaring oil prices.
Revenue for the six months, ended June 30, totalled US$245.6mln versus US$151.5mln a year ago.
Earnings (EBITDAX) reached US$212.3mln, from US$123.1mln, and, cash flow from operations more than doubled to US$216.3mln, from US$91.1mln. Free cash flow scaled to US$128.7mln, versus US$22.2mln in the first half of 2021.
Genel exited the half with some US$412.1mln of cash in the bank and US$280mln of debt.
Whilst maintaining the same 6 US cents per share interim dividend as paid last year, the company highlighted that its financial strength gives it “options for capital allocation”.
Moreover, its outlook statement pinpoints that “the company continues to actively pursue new business opportunities, focused on production and cash generation”.
“We generated US$129mln in free cash flow and are well on track to generate over a quarter of a billion dollars of free cash flow for the full year,” said interim chief executive Paul Weir.
“This continues to build our balance sheet strength and optionality, providing us with the funds to add the right assets at the right price.”
Weir, meanwhile, noted: “We remain focused on the delivery of our long-established strategy of putting capital to work to grow our production and cash generation, while retaining our resilience and paying a material and progressive dividend.”
Genel also noted that its international arbitration, in London, is ongoing as it seeks ‘substantial compensation from the KRG following the prior termination of the Miran and Bina Bawi production sharing contracts.
Looking ahead, Genel maintained full year production guidance of 30,000 to 31,000 barrels of oil per day – in H1 it measured 30,420 bopd – and said it expects 2022 free cash flow in excess of US$250mln, after capital expenditure of US$150mln to US$170mln for the year.
Operationally, key highlights in Kurdistan are expected to come from the ongoing appraisal and development at the Sarta field, whilst production volumes elsewhere are maintained.