Results for the Half Year ended 30 June 2020

Summary production statistics and key financials

 H1 2020H1 2019Change %
Production (Boepd)66,055    68,548    (3.6)
Revenue and other operating income ($m)1450.7  858.2  (47.5)
Realised oil price ($/bbl)143.6    66.1    (34.0)
Average unit operating expenditure ($/Boe)14.420.1(28.3)
Gross profit ($m)39.8   269.9   (85.3)
Profit before tax & net finance costs ($m)24.6  264.5  (90.6)
EBITDA ($m)2274.9   525.9   (47.7)
Stautory reported profit/(loss) after tax ($m)(619.0)   44.3   -
Statutory reported basic earnings/(loss) per share (cents)(37.4)2.7-
Cash generated from operations ($m)283.2    426.2    (33.6)
Cash capex ($m)    101.4   124.6   (18.6)
 End June 2020  End 2019    
Net (debt)/cash ($m)3(1,351.1)(1,413.0) (4.4)

1 Including gains of $35.2 million (2019: gains of $7.6 million) associated with EnQuest’s oil price hedges
2 EBITDA is calculated on a Business performance basis. It is calculated by taking profit/loss from operations before tax and finance income/(costs) and adding back depletion, depreciation, foreign exchange movements and inventory revaluation
Net (debt)/cash represents cash and cash equivalents less borrowings, stated including PIK but excluding accrued interest and the net-off of unamortised fees

2019 key performance indicators

In occupational safety, Lost Time Incident (‘LTI’) performance was good, with many assets recording an LTI-free year.

Lost Time Incident frequency represents the number of incidents per million exposure hours worked (based on 12 hours for offshore and eight hours for onshore).

Production was 23.7% higher than in 2018. Increased production from Magnus, Kraken, Scolty/Crathes and PM8/Seligi was partially offset by safety-related shutdowns at Thistle and Heather and underlying natural declines elsewhere in the portfolio.

Average unit operating costs were 10.4% lower than in 2018 ($23.0/Boe), primarily as a result of increased production.

Higher production from Magnus and Kraken combined with increased realised prices, reflecting the impact of the Group’s commodity hedge programme, increased EnQuest’s EBITDA.

Cash generated by operations was 26.1% higher than in 2018, primarily reflecting higher EBITDA.

Cash capex was 7.9% higher than in 2018, primarily driven by drilling programmes at Kraken, Magnus and PM8/Seligi and the Scolty/Crathes and Dunlin bypass sub-sea pipeline projects.

Net debt decreased by 20.4% compared to 2018, primarily reflecting the improved cash-generating capability of the Group with increased contributions from Magnus and Kraken. The Group has continued to voluntarily make early repayments of its senior credit facility.

Net 2P reserves decreased by 13.3% compared to 2018. During the year, the Group produced 9.6% of its year-end 2018 2P reserves base, with downward revisions at Heather/Broom and Thistle almost entirely offset by additions at the Group’s growth assets, Magnus, Kraken and PM8/Seligi.