EnQuest Plc shares drop as it confirms 2020 revenue and earnings hit

EnQuest Plc () shares fell in Thursday’s early deals as financial results revealed the impacts of a challenging 2020.

Revenue dropped to US$856.9mln, from US$1.71bn in 2019, and earnings (EBITDA) was reported at US$550.6mln, down from US$1.006bn in the prior year.

The company reported a US$625.8mln statutory loss including US$630mln of non-cash impairments.

It generated US$567mln of cash from operations and invested US$131.4mln of capex. Free cashflow from operations amounted to US$211mln, from US$368.5mln.

Production averaged 59,116 boepd which was in line with guidance but beneath the prior year’s average of 68,606 boepd. EnQuest saw an average realised oil price of US$41.3 per barrel.

Commentary in the results focussed on the recently announced deal to acquire the Golden Eagle field, a low-cost operation yielding around 10,000 boepd.

“Our quick and decisive actions in early 2020, combined with our reorganisation, have transformed the company,” said Amjad Bseisu, chief executive.

“The proposed acquisition of the low-cost Golden Eagle area will strengthen our business, providing additional production and strong cash flows which will partially utilise our UK tax assets.”

Bseisu added: “Our focus on extending the useful lives of existing assets through operational improvements and reducing emissions is well suited to operating through the energy transition and I am confident that EnQuest is well placed to succeed in a changing world.”

EnQuest shares dropped 5.06% to change hands at 19.08p.