TIDMCNE
RNS Number : 4376M
Capricorn Energy PLC
14 September 2023
FOR IMMEDIATE RELEASE 14 September 2023
CAPRICORN ENERGY PLC ("Capricorn" or "the Company")
(Unless otherwise stated, all dollar amounts ($) refer to US
dollars)
Half-Year Report Announcement
Randy Neely, Chief Executive, Capricorn Energy PLC said:
"Capricorn ended H1 2023 a very different business than at the
start of the year. The Company is on its way to becoming a much
leaner organisation, focused on tight cost control, shareholder
returns and maximising value from our Egypt portfolio. I was
appointed Chief Executive in June of this year and, while in the
early stages of the role, it is clear to me that we have a robust
and achievable strategy to maximise the value in our Company.
The strategic review introduced by the new Board in February has
formed a clear roadmap to drive change; return excess capital to
shareholders, right sizing the organisation, maximising the
potential of our Egyptian assets and the rationalisation of
non-core exploration assets. Progress has already been achieved,
specifically on the return of capital of approximately $575 million
to shareholders in 2023; I am delighted to confirm that in addition
to approximately $450 million returned in May and an ongoing share
buyback, of which approximately $15 million has already been
repurchased, shareholders will receive an unconditional special
dividend of approximately $100 million in October 2023, subject to
shareholder approval. We have also achieved a material reduction in
ongoing G&A, matching costs to the scale and priorities of the
business and made significant progress in exiting all non-Egypt
licences to focus capital and internal resources on the Egyptian
portfolio.
Looking ahead, the Company will focus on maximising the value of
our Egypt business. We have taken the decision to accelerate the
transfer of operations of our exploration assets to our joint
venture partner Cheiron to achieve operational synergies and
alignment with field development activity. This will allow the
Company to focus its limited internal technical resources on
production and development. Our management team is also preparing
for a detailed Operational Update in November, when we will outline
our plan for Capricorn's future."
Tawfik Diab, Chairman, Cheiron said:
"Following the arrival of Randy, great progress has already been
made in building a constructive partnership between Capricorn and
Cheiron. There is alignment between us as we move forward with
activities in the Western Desert for the benefit of the joint
venture and Egypt."
H1 2023 Operational and Strategic Highlights
Ø Strategic:
o $450m special dividend paid in May with a further payment of
approximately $100m expected to be paid on 20 October 2023
o General Meeting to be held on 5 October to approve return of
cash to shareholders
o Targeting completion of the $25m share buyback by end of year,
with $15m repurchased to date
o Prioritisation of Egypt development and production
operations
o Full exit of Mauritania exploration position
o Commencement of exiting all non-Egypt licenses
o 80% overall reduction in UK headcount by year end
o Targeting $20m run-rate G&A expenses once organisational
restructuring complete
o Appointment of Hesham Mekawi as non-executive Deputy
Chairman
Ø Operational and Financial:
o Revenue in Egypt of $98m with realised oil price of $78.56 per
boe and gas price of $2.95 per mmscf
o Accounts receivable from EGPC have increased from $97m to
$144m over the course of H1, with $113m overdue
o Operating cost per boe of $4.82 on WI basis
o Balance sheet: Group net cash of $176m
o $77m Capex and general exploration costs during H1; $49m in
Egypt and $28m across legacy international portfolio
o Eight wells drilled this year in Egypt oil-rich BED area with
one flowing at initial rates of up to 4,600 bopd following testing
in May
o Egypt H1 2023 WI production averaged 31,500 boepd
Ø ESG:
o MSCI classification upgraded from AA to AAA status
o Leading our peers in ESG related practices
Outlook
Ø Full Year forecast net capital expenditure of $117-127m
-- Egypt Development & Production $75-85m
-- Egypt Exploration & Appraisal $12m
Ø Full Year production expected to be at the low end of guidance
32,000 to 36,000 boepd, exiting at 34,000 boepd
Ø Non-core exits progressed: Mexico, Suriname &
Mauritania
Ø Ultimate G&A target of $1.50/boe (<$20m annually)
Ø Transferring operatorship of Egypt exploration acreage to
partner
Ø Teen field onstream
Ø Detailed Operational Update set for 30 November 2023 in
London
Ø On track with our Net Zero pathway and supporting JV partners
with decarbonisation initiatives
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation. Upon the publication of this
announcement via Regulatory Information Service, this inside
information is now considered to be in the public domain.
Enquiries to :
Analysts / Investors
Nathan Piper, Commercial Director Tel: 0131
475 3000
Media
Diana Milford, Corporate Affairs Tel: 0131
475 3000
Billy Clegg/Owen Roberts, Camarco Tel: 0203
757 4980
Webcast
There will be a live audio webcast of the results presentation
available to view on the website (www.capricornenergy.com) at 9am
BST. This can be accessed on PC, Mac, iPad, iPhone, and Android
mobile devices.
An 'on demand' version of the webcast will be available on the
website as soon as possible after the event. This can be viewed on
PC, Mac, iPad, iPhone, and Android mobile devices.
Presentation
The results presentation slides will be available on the website
from 7:00am BST.
Conference call
You can listen to the results presentation by dialling in to a
conference call at 9am BST using the below dial-in-details.
Analysts who wish to ask a question should use the conference call
facility.
Dial-in Details:
United Kingdom (Local): +44 (0) 33 0551 0200
Access code: Quote ' Capricorn Half Year Results' when prompted
by the operator.
Transcript
A transcript of the results presentation will be available on
the website as soon as possible after the event.
Corporate Overview
In Q1, the proposed reverse takeover of NewMed Energy was
terminated following strong shareholder opposition and campaign,
which also resulted in a renewal of the Board, with all but two
members resigning. Six new Board members were appointed at an
extraordinary general meeting on 1 February. Following their
appointment, the new Board, led by Craig van der Laan as Chair,
immediately began a company-wide assessment, focusing particularly
on the excessive legacy cost base. This strategic review was
presented on 27 April at the Company's Full Year Results, with some
goals already having been achieved. The five immediate priorities
were:
-- The return of excess cash to shareholders
-- Cost cuts and cash preservation
-- Ceasing exploration activities outside of near field activity in Egypt
-- Improving the Egypt business
-- Culture change
In line with these priorities, the Board returned approximately
$450 million to shareholders in May and expects to also return a
further special dividend of approximately $100 million on 20
October 2023. It remains the Board's intention to return further
surplus capital to shareholders. The special dividend, which will
be accompanied by a share consolidation and is subject to
shareholder approval, is expected to be paid on 20 October as a
final cash dividend of 56 pence per share. The consolidation and
special dividend record date is expected to be 5 October, with
dealings in the consolidated shares (ex-dividend) expected to
commence on 6 October.
By the end of the year the UK workforce will be reduced by 80%
to less than 30 people and a total staff level of approximately 50
people. This level of staffing better reflects the revised needs of
the business, and the combination of lower staff levels, reduced
office space, exiting the non-core exploration activities and a
laser focus on costs will lead to material savings in G&A
expenses. However, the full benefit of these reductions will not be
realised until 2024 due to the transition costs of making those
changes. Ultimately, the company is targeting G&A costs of
below $20m annually (less than $1.50/boe).
The receivables position owing from EGPC at the end of June is
$144m of which $113m is overdue. The increase in amounts
outstanding from EGPC is a key concern for the Company and
management will continue to work with EGPC to address this
issue.
At the beginning of the year, Capricorn was involved in a number
of high-risk exploration projects which were deemed by the new
Board as non-core. To date, the Company has relinquished its
Mauritanian position and continues to pursue the exit of its
exploration positions in the UK, Mexico and Suriname.
In June, Randy Neely became the CEO of Capricorn, bringing with
him extensive experience of running a low-cost, effective business
in Egypt and creating value in country.
Egypt Production
Working interest production across the four main concession
areas in the Western Desert averaged 31,450 boepd during the first
half of 2023, with 44% of the production mix comprising oil and
condensate, as liquids opportunities continued to offer the best
returns in the current price environment.
The 2023 well programme is expected to deliver 40 wells. The
joint venture is focused on continual optimisation of the programme
to improve overall drilling, completion and hook-up performance.
Fourteen wells have been completed in the BED area, a combination
of producer, water injector and near field exploration following a
number of successful wells drilled in the area in 2022, extending
field limits and, potentially, reserves. The BED area comprises a
series of stacked reservoirs with varying degrees of production
maturity. Recent activity here has been stimulated by a developing
view of the Abu Roash reservoir, positively impacted by wells early
in 2023 that exceeded expectations in terms of reservoir
development and hydrocarbon distribution. This field remains a
focus in the second half of 2023 with nine further wells planned.
In the Karam Field, located in the AESW concession, a well
completed in May at initial rates of up to 4,600 bopd in the same
Abu Roash reservoir producing at BED, the highest flowrates
encountered in the joint venture to date.
Production has also been impacted by operational challenges with
system constraints and wells impacted by ESP performance. In the
second half of 2023, the Teen project came online from two wells,
several months later than originally planned. This project will
initially be focused on establishing the productivity from the two
wells to support a future decision on full field development.
Capricorn is working collaboratively with the operating partner to
focus on production performance in the second half of 2023 with
active high grading of new wells, in particular liquids rich
opportunities and the appointment of production expertise in Cairo.
We will continue to work with our partner to seek opportunities to
enhance operational efficiency through the rig fleet to improve
well delivery.
As a consequence of drilling fewer wells than planned and
production performance of the asset in the first half of 2023,
Capricorn now expects annual net working interest production to be
at the low end of original guidance. This reflects our up-to-date
views and plans, including; the reduction in well count for the
year, higher than expected ESP failures, encountered facility /
system constraints with new wells, uncertainty in performance and
delayed timing of the Teen project, new well performance and our
learned understanding of the existing well stock.
Capricorn remains committed to our net-zero roadmap with
accelerated short and medium-term GHG equity emission reduction
targets (15% by 2025/30% by 2030) on track. We continue to support
decarbonisation initiatives relating to projects to reduce flaring,
venting and fugitive emissions. Recent successes include the
implementation of Phase 1 of identification and mitigation of
fugitive emissions, with Phase 2 implementation planned within
scheduled shutdowns.
Egypt Exploration
Egypt
Capricorn undertakes two exploration workstreams within its
Western Desert portfolio, firstly on four exploration concessions
and secondly on the Bapetco operated acreage. As a result,
Capricorn is exposed to a variety of opportunity types from near
field opportunities, established proven play types and
unconventional resource opportunities. In July, Capricorn began
taking steps to turn the operatorship of three exploration
concessions over to Cheiron. This offers a number of synergistic
and cost benefits to Capricorn, with operational benefits from rig
schedule optimisation, while allowing Capricorn to make
organisational changes to focus on delivering value from its
producing position in the Western Desert basin.
In 2023 Capricorn began a campaign of operated exploration
drilling, initially targeting the Abu Sennan licence in the South
of the Western Desert. These two wells fulfilled the work
commitments of the licence, and while they were delivered under
budget and fully tested a number of play types on the fringe of the
El Gharadig Basin, they were unfortunately dry. The block is now in
the process of being relinquished.
In the first half of 2023 an additional well was drilled in the
South East Horus licence, the first of a minimum of two planned
wells. This well was also dry and the focus now turns to the new 3D
data acquired on the licence in 2022 to mature further
opportunities for drilling.
Following the transfer of operatorship to Cheiron, further
drilling on the South East Horus licence and the commencement of
drilling in West El Fayoum licences are currently scheduled in Q1
2024. In addition, in 2024 the joint venture will commence drilling
in North Um Baraka where 3D was also acquired in 2022; two wells
will be drilled here.
Non-core Portfolio
UK
Capricorn operates five UK Southern North Sea licences: P2428
and P2567 (Capricorn 60% WI) and P2560, P2561 and P2562 (Capricorn
70% WI) with partner Deltic Energy.
Across the five Mid North Sea High licences, the technical work
programme has been concluded ahead of well investment decisions in
H2 2023. There is no further capital commitment on the remaining UK
licences and Capricorn has initiated steps to expediently exit the
licences prior to the year-end by surrender or withdrawal.
Mexico
Capricorn has interests in four blocks in the Gulf of Mexico,
two as Operator: Blocks 9 (Capricorn 50% WI) and 15 (Capricorn 50%
WI), and two as non-Operator: Blocks 7 (Capricorn 30% WI) and 10
(Capricorn 15% WI).
Capricorn's final commitment exploration well in Mexico,
Yatzil-1X in Block 7 (Eni Operator) was drilled in Q1 2023 and
discovered hydrocarbons. According to preliminary Operator
estimates, around 200 million barrels of oil may be in place.
Capricorn internal analysis led to the decision not to participate
in the forthcoming phases and the Company has therefore informed
partners of its decision to withdraw from the Block 7 licence.
Capricorn's withdrawal processes in Blocks 9 and 10 and the JV
relinquishment process in Block 15 are ongoing with completion
expected by Q1 2024.
Suriname
Capricorn operates Block 61 (100% WI), situated in the
Guyana-Suriname basin where significant discoveries continue to be
made. Capricorn marketed the licence to farm-down its position in
HI 2023 and was unsuccessful in attracting interests in this block
in advance of expiry in October 2023. As such, the block will be
relinquished in Q4.
Senegal
On 18 June Capricorn noted Woodside Energy's announcement
regarding its Sangomar Field Development in Senegal where the
targeted first oil moved from late 2023 to mid-2024. Capricorn is
entitled to a contingent payment of between $25m and $50m if first
oil is achieved in the first half of 2024 and the average Brent oil
price during the first six months of production exceeds the $55/bbl
or $60/bbl thresholds contained in the sale and purchase agreement.
There is no payment if first oil is achieved later than H1/2024.
Capricorn is committed to return any proceeds of this contingent
payment to its shareholders.
Principal risks and uncertainties
Managing Capricorn's key risks and associated opportunities is
essential to the company's long-term success and sustainability.
The Group endeavours to pursue investment opportunities which offer
an appropriate level of return whilst ensuring the level of
associated political, commercial and technical risk remains within
the defined risk appetite of the company.
Capricorn's risk management framework provides a systematic
process for the identification and management of the key risks and
opportunities which may affect the delivery of the Group's
strategic objectives. Key Performance Indicators are set annually
and determining the level of risk the business is willing to accept
in the pursuit of these objectives is a fundamental component of
Capricorn's risk management framework.
Overall responsibility for the system of risk management and
internal control and reviewing the effectiveness of such systems
rests with the Board. Principal risks, as well as progress against
key risk projects, are reviewed at each Board meeting and at least
once a year the Board undertakes a risk workshop to review the
Group's principal risks. This integrated approach to risk
management has been and continues to be critical to the delivery of
strategic objectives.
Responding to Changing Risks during H2 2023
Capricorn has assessed the risks and uncertainties at the end of
H1 2023 and the principal risks are:
Volatile oil and gas prices
Failure to replace long-term reserves and resources
Increasing EGPC receivables balance
Reserves downgrade or impairment
Failure to improve fiscal terms in Egypt
Senegal project delay beyond June 2024
Future challenges and costs to achieving pathway to Net Zero
2040
Lack of adherence to health, safety, environment and security
policies
Failure to unlock value from strategic review
Fraud, bribery and corruption
As part of the embedded risk management process, the Group
actively considers emerging risks and opportunities which could
negatively or positively impact on the business. Egypt continues to
be the focus of the discussions and work continues to identify
potential known and emerging threats and opportunities which could
impact on the new Capricorn's ability to grow the Egypt business
both organically and inorganically.
Financial Review
Key production statistics
Period Period Year
ended ended ended
30 June 30 June 31 December
2023 2022 2022
Production - net WI share (boepd) 31,496 35,500 34,228
Sales volumes - net EI oil (boepd) 5,536 5,628 5,028
Sales volume - net EI gas (mmscfd) 40.4 47.3 44.5
Average price per bbl ($)* 78.6 110.9 98.8
Revenue from production ($m) 98.3 137.4 228.9
Average production costs per boe
($) 4.8 5.1 5.7
(*excludes reduction in revenue due to expected credit loss
charge)
Loss for the Period
Period Period Year
ended
30 June ended ended
2023 30 June 31 December
$m 2022 2022
$m $m
Profit/(Loss) from Egypt operating
segment 6.9 7.5 (36.8)
Loss from other Group continuing
operations (58.3) (87.6) (135.2)
(Loss)/Profit from discontinued
operations (10.8) 120.9 109.3
(Loss)/Profit after taxation (62.2) 40.8 (62.7)
==================================== ========== ========= =============
Change in Accounting Policy - Intangible exploration/appraisal
assets
Following completion of the Group's strategic review, Capricorn
has changed its policy for accounting for non-well specific general
exploration costs. Previously such costs were capitalised and
allocated to future exploration wells and would either remain
capitalised or be charged to the Income Statement dependent upon
the success of the well. Now, all non-well specific exploration
costs are charged to the Income Statement as they are incurred.
The directors believe that this policy provides a clearer
understanding of the performance of the Group in any given period
as Capricorn moves from an exploration-led business to one focussed
on maximising value from its producing assets.
Egypt Operating Segment Results
In Egypt, total revenue was $98.3m. $76.6m was generated on sale
of liquids with an average price of $78.56 per bbl on net sales
volumes of 1.0 mmbbls. Gas revenue was $21.7m from volumes of 7.3
mmscf at the contracted rate of $2.95/mmscf.
Cost of sales in the first half of the year were $27.5m,
including a $0.9m offset for inventory movements. Production costs
decreased slightly to $4.8 per boe, on working interest production
over the six-month period, while depletion charges were $55.1m, at
a weighted average rate of $20.74 per boe across the
concessions.
Capricorn records other income on additional production that is
notionally allocated to the Group to cover tax due on profits from
the concessions. This is offset by an equal and opposite tax
charge. In the current period, the value of this income and
notional tax gross-up is $29.8m.
Net finance costs in Egypt of $7.5m, including loan interest and
charges, and the Group recognised a fair value loss of $3.4m on
deferred consideration payable on the 2021 business
combination.
The total tax charge on Egypt operations for the period is
$19.1m, being the tax gross-up charge of $29.8m offset by deferred
tax credits on asset temporary differences.
Results from Other Continuing operations
The loss on other continuing operations of $58.3m includes
unsuccessful exploration costs of $16.4m and general exploration
costs of $11.4m. $21.6m of this cost related to operations in
Mexico where the Group concluded its exploration programme with the
drilling of the Yatzil well. Administration charges of $40.4m,
include $12.0m of redundancy costs following the reduction of staff
numbers based in Edinburgh and $6.9m of costs relating to the
aborted corporate transactions proposed by the previous Board. Net
finance income of $9.5m includes interest earned on cash and cash
equivalents of $15.6m offset by foreign exchange losses of
$6.1m.
Discontinued Operations
Earn-out consideration on disposal of UK Producing assets
During the period the Group made a loss of $21.5m on the fair
value of future earnout payments due on prior year disposals of UK
producing assets. The loss was partially offset by a refund of
production costs of $4.3m, following completion of joint venture
audits, interest income of $2.3m on the 2022 contingent payment and
a deferred tax credit of $4.1m.
Cash received in March 2023 relating to the 2022 earnout was
$136.7m, including the interest noted above.
Contingent consideration on Senegal asset sale
Capricorn disposed of its interests in Senegal in 2020. Under
the sale agreement, Capricorn may be due a further consideration of
up to $50m dependent on production starting before 30 June 2024 and
the prevailing oil price. No revenue has been recognised for this
possible payment to date.
Net cash inflow for the Period
$m
Opening net cash as at 1 January 2023 596.9
Dividend paid (445.7)
Share re-purchase (11.4)
Net cash inflow from Egypt operations (see reconciliation
below) 22.7
Net cash inflow from UK discontinued operations
(1) 141.0
Exploration expenditure - Egypt (2) (8.2)
Exploration expenditure - other (2) (20.6)
Development expenditure - Egypt (37.7)
Deferred consideration - Egypt (25.0)
Pre-award costs and business development (3) (5.8)
Administration expenses, corporate assets, and
office lease costs (22.5)
Share purchases and equity (4) (16.1)
Net finance income other movements (5) 7.0
Closing net cash as at 31 December 2022 (6) 174.6
=========================================================== ======================
(1) Earnout consideration of $136.7m including interest and
working capital settlement of $4.3m
(2) Includes general exploration costs; Egypt $4.4m, other
$11.4m
(3) Cash outflows on business development activities of $4.8m
are reallocated from administration costs
(4) Share purchases for LTIP of $16.9m less $0.8m proceeds from
issue of shares on exercise of options
(5) Interest received of $18.4m less foreign exchange loss on
cash and cash equivalents of $1.9m and other interest and charges
of $9.5m
(6) Closing cash of $301.0m less loans and borrowings of $126.4m
excluding unamortised facility fees of $1.9m
Cash and cash equivalent balances at 30 June 2023 of $301.0m
were offset by borrowings in Egypt of $126.4m. Cash includes
restricted cash balances of $35.1m which may not be distributed to
shareholders. Of this amount, $33.9m is available for use to fund
non-operated concessions in Egypt. Loan repayments in the period
were $33.5m.
Cash inflows from operations in Egypt of U$22.7m can be
reconciled to cash flows from operating activities per the
statutory cash flow as follows:
$m
Operating cash flow per statutory cash flow statement (15.5)
Non-GAAP Adjustments:
Discontinued operations - working capital settlements (4.3)
Pre-award and new venture costs reallocated 5.8
Administration expenses 20.9
General exploration costs 15.8
Net cash inflow from Egypt operations 22.7
======================================================= =======
Balance Sheet
The Group's net asset position at 30 June 2023 is summarised as
follows:
$m
Exploration assets 0.8
Development/producing assets and goodwill 265.9
Other non-current assets 28.4
Financial assets at fair value through profit
and loss 74.7
Trade and other receivables and payables, provisions
and inventory 116.5
Lease liabilities (19.2)
Net cash, including unamortised facility fees 176.5
Deferred consideration on business combination (40.2)
Net deferred taxation and other liabilities (7.6)
Net assets 595.8
====================================================== =======
Exploration assets
Following the change in accounting policy, exploration assets of
$0.8m at 30 June 2023 relate wholly to planned exploration wells in
Egypt. Costs associated with NFE wells are included within
development/producing assets.
Development assets and goodwill
At the period end, the carrying value of the Group's producing
assets in Egypt was $240.5m, after additions of $41.8m, and
depletion charges of $55.1m for the period.
The Group reviewed its producing assets and goodwill in Egypt
for indicators of impairment, however no indicators were
identified, and no impairment tests have therefore been performed
at the half-year.
Other assets and liabilities
Financial assets at fair value through profit and loss include
$68.1m of future earnout consideration receivable. Deferred
consideration payable on the Egypt business combination is also
held at fair value with a total liability of $40.2m for payments
due in 2024 and 2025.
Trade receivables at the period end were $144.2m, an increase of
$47.3m across the period. $113.3m of this amount was overdue.
Capricorn continue to work with partners and engage with EGPC in
Egypt to address the receivables position.
Lease liabilities at the period end include amounts due for new
office premises in Edinburgh originally planned to accommodate the
Group's head office and the associated right-of-use asset is
included in other non-current assets. The move to the new office
space has been aborted and Capricorn are working to sub-let this
office space with alternative, smaller premises having been
secured.
The Group's net deferred tax position at 30 June fully relates
to assets in Egypt, with the UK deferred tax liability on earnout
consideration receivable having reversed in full.
Equity movements
Shareholder returns and share premium cancellation
Capricorn returned $457.9 to shareholders by way of a dividend
of $445.7m and $12.2m share re-purchase in H1 2023. The Company
undertook a share consolidation at the same time as paying the
dividend. This completed on 15 May 2023 where the existing
315,072,439 of ordinary shares of 21/13 pence each were replaced
with 148,534,155 ordinary shares of 490/143 pence each.
In anticipation of returns to shareholders, Capricorn undertook
a share premium cancellation which completed in 2023, following a
shareholder vote on 15 December 2022. The cancellation received the
required confirmation for the Court of Session in late January 2023
and was registered with the Register of Companies on 31 January
2023, which is the effective date of the cancellation. The full
amount of the Company's share premium accounts transferred to
retained earnings increasing distributable reserves available for
future returns.
Statement of Directors' Responsibilities
The directors confirm that these condensed consolidated interim
financial statements have been prepared in accordance with UK
adopted International Accounting Standard 34, 'Interim Financial
Reporting', and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority and
give a true and fair view of the assets, liabilities, financial
position and loss for the period and that the interim management
report includes a fair review of the information required by DTR
4.2.7 and DTR 4.2.8, namely:
Ø an indication of important events that have occurred during
the first six months and their impact on the condensed set of
financial statements, and
Ø a description of the principal risks and uncertainties for the
remaining six months of the financial year.
There were no material related-party transactions in the first
six months and no material changes in the related-party
transactions described in the last annual report.
The directors of Capricorn Energy PLC are listed in the
Capricorn Energy PLC Annual Report for 31 December 2022. A list of
current directors is maintained on the Capricorn Energy PLC
website: www.capricornenergy.com .
By order of the Board.
Randy Neely
Chief Executive
13 September 2023
About Capricorn Energy PLC
Capricorn is an Egypt-focused energy producer, with an
attractive portfolio of onshore exploration, development and
production assets in the Western Desert.
For further information on Capricorn please see:
www.capricornenergy.com .
Independent review report to Capricorn Energy PLC
Report on the condensed consolidated interim financial
statements
Our conclusion
We have reviewed Capricorn Energy PLC's condensed consolidated
interim financial statements (the "interim financial statements")
in the Financial Statements of Capricorn Energy PLC for the 6 month
period ended 30 June 2023 (the "period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
The interim financial statements comprise:
-- the Group Balance Sheet as at 30 June 2023;
-- the Group Income Statement and Group Statement of
Comprehensive Income for the period then ended;
-- the Group Statement of Cash Flows for the period then ended;
-- the Group Statement of Changes in Equity for the period then ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the Financial
Statements of Capricorn Energy PLC have been prepared in accordance
with UK adopted International Accounting Standard 34, 'Interim
Financial Reporting' and the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' issued by the Financial Reporting Council for use in the
United Kingdom ("ISRE (UK) 2410"). A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Financial
Statements and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on
the review procedures performed in accordance with ISRE (UK) 2410.
However, future events or conditions may cause the group to cease
to continue as a going concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Financial Statements, including the interim financial
statements, is the responsibility of, and has been approved by the
directors. The directors are responsible for preparing the
Financial Statements in accordance with the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority. In preparing the Financial Statements, including
the interim financial statements, the directors are responsible for
assessing the group's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors
either intend to liquidate the group or to cease operations, or
have no realistic alternative but to do so.
Our responsibility is to express a conclusion on the interim
financial statements in the Financial Statements based on our
review. Our conclusion, including our Conclusions relating to going
concern, is based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion paragraph of
this report. This report, including the conclusion, has been
prepared for and only for the company for the purpose of complying
with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and for no other
purpose. We do not, in giving this conclusion, accept or assume
responsibility for any other purpose or to any other person to whom
this report is shown or into whose hands it may come save where
expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
Edinburgh
13 September 2023
Capricorn Energy PLC
Financial Statements
For the six months ended 30 June 2023
Contents
------------------------------------------------------------------
Group Income Statement
Group Statement of Comprehensive Income
Group Balance Sheet
Group Statement of Cash Flows
Group Statement of Changes in Equity
Section 1 - Basis of Preparation
1.1 Accounting Policies: Basis of Preparation
1.2 Going Concern
1.3 Restatement of Comparative Information
Section 2 - Oil and Gas Assets and Operations
2.1 Gross Profit: Revenue and Cost of Sales
2.2 Intangible Exploration/Appraisal Assets
2.3 Property, Plant & Equipment - Development/Producing Assets
2.4 Other Property, Plant & Equipment and Intangible Assets
2.5 Capital Commitments
Section 3 - Working Capital, Financial Instruments and Long-Term
Liabilities
3.1 Cash and Cash Equivalents
3.2 Loans and Borrowings
3.3 Lease Liabilities
3.4 Trade and Other Receivables
3.5 Financial Assets and Liabilities at Fair Value Through Profit
and Loss
3.6 Trade and Other Payables
Section 4 - Income Statement Analysis
4.1 Segmental Analysis
4.2 Administrative and Other Expenses
4.3 Finance Income
4.4 Finance Costs
4.5 Earnings per Ordinary Share
Section 5 - Taxation
5.1 Tax Charge on (Loss)/Profit for the Period
5.2 Deferred Tax Asset and Liabilities
Section 6 - Discontinued Operations
6.1 (Loss)/Profit from Discontinued Operations
6.2 Cash Flow Information for Discontinued Operations
Section 7 - Share Capital
7.1 Called-Up Share Capital
7.2 Return of Cash to Shareholders
7.3 Share Buyback
Capricorn Energy PLC
Group Income Statement
For the six months ended 30 June 2023
Year
Six months ended ended
Six months ended 30 June 31 December
30 June 2022 2022
2023 (unaudited) (audited)
(unaudited) (restated) (restated)
Note $m $m $m
Continuing operations
Revenue 2.1 98.8 137.4 229.6
Other income 2.1 29.8 23.0 54.8
Cost of sales (27.5) (32.8) (71.2)
Depletion charge 2.3 (55.1) (72.0) (124.1)
Gross profit 46.0 55.6 89.1
Pre-award costs (1.0) (6.3) (9.2)
General exploration costs (15.8) (19.9) (48.7)
Unsuccessful exploration well costs 2.2 (18.6) (22.7) (57.8)
Impairment of intangible exploration/appraisal assets 2.2 - (17.4) -
Impairment of property, plant and equipment -
development/producing assets 2.3 - - (42.6)
Other operating income 0.4 0.1 5.8
Administrative and other expenses 4.2 (41.3) (33.5) (65.0)
Operating loss (30.3) (44.1) (128.4)
Fair value loss - deferred consideration on business
combination (3.4) (11.2) (12.7)
Gain on financial assets at fair value through profit or
loss - 1.5 2.3
Finance income 4.3 16.3 5.1 15.7
Finance costs 4.4 (14.9) (6.8) (18.2)
Loss before taxation from continuing operations (32.3) (55.5) (141.3)
Tax charge 5.1 (19.1) (24.6) (30.7)
--------------------------------------------------------- ----- ------------------ ----------------- -------------
Loss from continuing operations (51.4) (80.1) (172.0)
(Loss)/Profit from discontinued operations 6.1 (10.8) 120.9 109.3
--------------------------------------------------------- ----- ------------------ ----------------- -------------
(Loss)/Profit for the period attributable to equity
holders of the Parent (62.2) 40.8 (62.7)
--------------------------------------------------------- ----- ------------------ ----------------- -------------
Earnings per share for loss from continuing operations:
Loss per ordinary share - basic and diluted ($) 4.5 (0.17) (0.20) (0.48)
Earnings per share for (loss)/profit attributable to
equity holders of the Parent:
(Loss)/Profit per ordinary share - basic and diluted ($) 4.5 (0.21) 0.10 (0.17)
--------------------------------------------------------- ----- ------------------ ----------------- -------------
Capricorn Energy PLC
Group Statement of Comprehensive Income
For the six months ended 30 June 2023
Year
Six months ended ended
Six months ended 30 June 31 December
30 June 2022 2022
2023 (unaudited) (audited)
(unaudited) (restated) (restated)
$m $m $m
-------------------------------------------------------- --- --------------------- ----------------- -------------
(Loss)/Profit for the period attributable to equity holders
of the Parent (62.2) 40.8 (62.7)
Other Comprehensive Income/(Expense) - items that may
be recycled to the Income Statement
Currency translation differences 5.3 (16.1) (16.7)
Other Comprehensive Income/ (Expense) for the period 5.3 (16.1) (16.7)
------------------------------------------------------------- --------------------- ----------------- -------------
Total Comprehensive (Expense)/Income for the period
attributable to equity holders of the
Parent (56.9) 24.7 (79.4)
------------------------------------------------------------- --------------------- ----------------- -------------
Total Comprehensive (Expense)/Income from:
Continuing operations (46.1) (96.2) (188.7)
Discontinuing operations (10.8) 120.9 109.3
------------------------------------------------------------- --------------------- ----------------- -------------
(56.9) 24.7 (79.4)
------------------------------------------------------------ --------------------- ----------------- -------------
Capricorn Energy PLC
Group Balance Sheet
As at 30 June 2023
30 June 31 December
30 June 2022 2022
2023 (unaudited) (audited)
(unaudited) (restated) (restated)
Note $m $m $m
------------------------------------------------------------ ----- -------------- ------------- ------------
Non-current assets
Intangible exploration/appraisal assets 2.2 0.8 0.9 1.0
Property, plant & equipment - development/producing assets 2.3 240.5 338.4 253.8
Goodwill 25.4 25.4 25.4
Other property, plant & equipment and intangible assets 2.4 28.4 11.7 14.1
Financial assets at fair value through profit or loss 3.5 36.7 119.2 96.2
Deferred tax asset 5.2 8.5 - 7.6
340.3 495.6 398.1
------------------------------------------------------------ ----- -------------- ------------- ------------
Current assets
Cash and cash equivalents 3.1 301.0 809.0 756.8
Inventory 9.0 10.8 8.1
Trade and other receivables 3.4 197.0 211.8 142.5
Financial assets at fair value through profit or loss 3.5 38.0 127.7 134.4
545.0 1,159.3 1,041.8
------------------------------------------------------------ ----- -------------- ------------- ------------
Total assets 885.3 1,654.9 1,439.9
------------------------------------------------------------ ----- -------------- ------------- ------------
Current liabilities
Loans and borrowings 3.2 20.3 16.3 25.4
Lease liabilities 3.3 1.1 1.9 1.9
Deferred consideration on business combinations 3.5 23.3 24.6 25.0
Trade and other payables 3.6 85.1 138.2 55.7
Provisions - well abandonment 0.8 0.5 0.4
130.6 181.5 108.4
------------------------------------------------------------ ----- -------------- ------------- ------------
Non-current liabilities
Loans and borrowings 3.2 104.2 157.6 133.2
Lease liabilities 3.3 18.1 0.2 2.4
Deferred consideration on business combinations 3.5 16.9 35.7 36.8
Deferred tax liabilities 5.2 16.1 51.9 30.1
Provisions - well abandonment 3.6 3.0 3.0
158.9 248.4 205.5
------------------------------------------------------------ ----- -------------- ------------- ------------
Total liabilities 289.5 429.9 313.9
------------------------------------------------------------ ----- -------------- ------------- ------------
Net assets 595.8 1,225.0 1,126.0
------------------------------------------------------------ ----- -------------- ------------- ------------
Equity attributable to equity holders of the Parent
Called-up share capital 7.1 7.8 8.0 8.0
Share premium 7.1 0.8 494.7 495.4
Shares held by ESOP/SIP Trusts (11.9) (19.3) (15.3)
Foreign currency translation (85.5) (90.2) (90.8)
Merger and capital reserves 45.7 45.5 45.5
Retained earnings 638.9 786.3 683.2
------------------------------------------------------------ ----- -------------- ------------- ------------
Total equity 595.8 1,225.0 1,126.0
------------------------------------------------------------ ----- -------------- ------------- ------------
Capricorn Energy PLC
Group Statement of Cash Flows
For the six months ended 30 June 2023
Year
Six months ended ended
Six months ended 30 June 31 December
30 June 2022 2022
2023 (unaudited) (audited)
(unaudited) (restated) (restated)
$m $m $m
-------------------------------------------------------------- ------------------ ----------------- ---------------
Cash flows from operating activities:
Loss before taxation from continuing operations (32.3) (55.5) (141.3)
(Loss)/Profit before tax from discontinued operations (note
6.1) (14.9) 128.7 113.4
-------------------------------------------------------------- ------------------ ----------------- ---------------
(Loss)/Profit before tax including discontinued operations (47.2) 73.2 (27.9)
Adjustments for non-cash income and expense and non-operating
cash flows:
Other income - tax entitlement volumes (29.8) (23.0) (54.8)
Unsuccessful exploration costs 18.6 22.7 57.8
Depreciation, depletion and amortisation charges 59.2 75.0 129.9
Impairment of intangible exploration/appraisal assets - 17.4 -
Impairment of property, plant and equipment -
development/producing assets - - 42.6
Share-based payments charge 0.7 5.7 10.5
Fair value loss - deferred consideration on business
combination 3.4 11.2 12.7
Loss/(Gain) on financial assets at fair value through profit
or loss 19.2 (129.2) (112.7)
Finance income (16.3) (5.1) (15.7)
Finance costs 14.9 6.8 18.2
Adjustments in current assets and liabilities:
Inventory movement (0.9) - 2.7
Increase in trade and other receivables (note 3.4) (36.7) (62.2) (38.7)
(Decrease)/Increase in trade and other payables (note 3.6) (0.6) 6.7 (9.8)
Net cash flows (used in)/from operating activities (15.5) (0.8) 14.8
-------------------------------------------------------------- ------------------ ----------------- ---------------
Cash flows from investing activities:
Exceptional income - India tax refund - 1,056.0 1,056.0
Expenditure on intangible exploration/appraisal assets (13.0) (38.5) (46.2)
Expenditure on development/producing assets (37.7) (23.2) (62.2)
Expenditure on other property, plant & equipment and
intangible assets (0.1) (10.6) (11.7)
Deferred consideration received - discontinued operations 134.4 75.7 75.7
Consideration paid for assets acquired through business
combination - (3.2) (3.2)
Deferred consideration paid on business combination (25.0) (20.9) (20.9)
Proceeds on disposal of financial assets - 12.8 12.8
Tax paid on investing activities - - (0.2)
Interest received and other finance income 20.7 2.7 12.5
Net cash flows from investing activities 79.3 1,050.8 1,012.6
-------------------------------------------------------------- ------------------ ----------------- ---------------
Cash flows from financing activities:
Return of cash to shareholders (445.7) - -
Share re-purchase (11.4) (528.6) (528.6)
Other interest and charges (9.5) (7.3) (11.7)
Repayment of loans and borrowings (33.5) (3.7) (21.5)
Proceeds from issue of shares 0.8 3.8 4.5
Cost of shares purchased (16.9) (19.8) (19.8)
Lease payments (1.5) (1.4) (2.5)
Net cash flows used in financing activities (517.7) (557.0) (579.6)
-------------------------------------------------------------- ------------------ ----------------- ---------------
Net (decrease)/increase in cash and cash equivalents (453.9) 493.0 447.8
Opening cash and cash equivalents at the beginning of the
period 756.8 314.1 314.1
Foreign exchange differences (1.9) 1.9 (5.1)
-------------------------------------------------------------- ------------------ ----------------- ---------------
Closing cash and cash equivalents (note 3.1) 301.0 809.0 756.8
-------------------------------------------------------------- ------------------ ----------------- ---------------
Capricorn Energy PLC
Group Statement of Changes in Equity
For the six months ended 30 June 2023
Equity
share
capital and Shares held Foreign Merger and Retained
share by ESOP/ SIP currency capital earnings Total equity
premium Trusts translation reserves (restated) (restated)
$m $m $m $m $m $m
------------------- -------------- -------------- --------------- --------------- --------------- --------------
At 1 January 2022 503.5 (17.5) (74.1) 40.9 1,345.8 1,798.6
Restatement - - - - (76.9) (76.9)
------------------- -------------- -------------- --------------- --------------- --------------- --------------
At 1 January 2022
- restated 503.5 (17.5) (74.1) 40.9 1,268.9 1,721.7
Loss for the year - - - - (62.7) (62.7)
Currency
translation
differences - - (16.7) - - (16.7)
------------------- -------------- -------------- --------------- --------------- --------------- --------------
Total
comprehensive
expense - - (16.7) - (62.7) (79.4)
Share-based
payments - - - - 10.5 10.5
Exercise of
employee share
options 4.5 - - - - 4.5
Share re-purchase (4.6) - - 4.6 (511.5) (511.5)
Cost of shares
purchased - (19.8) - - - (19.8)
Cost of shares
vesting - 22.0 - - (22.0) -
------------------- -------------- -------------- --------------- --------------- --------------- --------------
At 31 December
2022 503.4 (15.3) (90.8) 45.5 683.2 1,126.0
Loss for the
period - - - - (62.2) (62.2)
Currency
translation
differences - - 5.3 - - 5.3
Total
comprehensive
income/(expense) - - 5.3 - (62.2) (56.9)
Share-based
payments - - - - 0.7 0.7
Exercise of
employee share
options 0.8 - - - - 0.8
Share premium
cancelled (495.4) - - - 495.4 -
Cost of shares
purchased - (16.9) - - - (16.9)
Cost of shares
vesting - 20.3 - - (20.3) -
Dividends paid - - - - (445.7) (445.7)
Share re-purchase (0.2) - - 0.2 (12.2) (12.2)
At 30 June 2023 8.6 (11.9) (85.5) 45.7 638.9 595.8
------------------- -------------- -------------- --------------- --------------- --------------- --------------
Capricorn Energy PLC
Group Statement of Changes in Equity (continued)
For the six months ended 30 June 2022
Equity share
capital and Shares held Foreign Merger and Retained Total
share by ESOP/ SIP currency capital earnings equity
premium Trusts translation reserves (restated) (restated)
$m $m $m $m $m $m
------------------- -------------- --------------- --------------- --------------- --------------- -------------
At 1 January
2022 503.5 (17.5) (74.1) 40.9 1,345.8 1,798.6
Restatement - - - - (76.9) (76.9)
------------------- -------------- --------------- --------------- --------------- --------------- -------------
At 1 January 2022
- restated 503.5 (17.5) (74.1) 40.9 1,268.9 1,721.7
Profit for the
period - - - - 40.8 40.8
Currency
translation
differences - - (16.1) - - (16.1)
------------------- -------------- --------------- --------------- --------------- --------------- -------------
Total
comprehensive
(expense)/income - - (16.1) - 40.8 24.7
Share-based
payments - - - - 5.7 5.7
Exercise of
employee share
options 3.8 - - - - 3.8
Share re-purchase (4.6) - - 4.6 (511.1) (511.1)
Cost of shares
purchased - (19.8) - - - (19.8)
Cost of shares
vesting - 18.0 - - (18.0) -
------------------- -------------- --------------- --------------- --------------- --------------- -------------
At 30 June 2022 502.7 (19.3) (90.2) 45.5 786.3 1,225.0
------------------- -------------- --------------- --------------- --------------- --------------- -------------
Section 1 - Basis of Preparation
1.1 Accounting Policies: Basis of Preparation
The half-yearly condensed consolidated Financial Statements (the
"Financial Statements") for the six months ended 30 June 2023 have
been prepared in accordance with the Disclosure and Transparency
Rules of the Financial Conduct Authority and with UK adopted
International Accounting Standard IAS 34, 'Interim financial
reporting'. They should be read in conjunction with the annual
Financial Statements for the year ended 31 December 2022, which
have been prepared in accordance with UK-adopted International
Accounting Standards and with the requirements of the Companies Act
2006 as applicable to companies reporting under those
standards.
This half-yearly report was approved by the Directors on 13
September 2023. The disclosed figures, which have been reviewed but
not audited, are not statutory accounts in terms of Section 434 of
the Companies Act 2006. Statutory accounts for the year ended 31
December 2022, on which the auditors gave an unqualified audit
report, which did not contain an emphasis of matter paragraph or
any statement under section 498 of the Companies Act 2006, have
been filed with the Registrar of Companies.
This half-yearly report has been prepared on a basis consistent
with the accounting policies expected to be applied for the year
ending 31 December 2023 and uses the same accounting and financial
risk management policies and methods of computation as those
applied for the year ended 31 December 2022, other than changes to
accounting policies resulting from the adoption of new or revised
accounting standards and a change in the accounting policy for
intangible exploration/appraisal assets as detailed in note 1.3
below. C hanges to IFRS effective 1 January 2023 have no
significant impact on Capricorn's accounting policies or Financial
Statements.
Significant key estimates and assumptions are unchanged from
those applied in the year ended 31 December 2022 and therefore
apply to these Financial Statements.
1.2 Going Concern
The Directors have considered the factors relevant to support a
statement of going concern. In assessing whether the going concern
assumption is appropriate, the Board considered the Group cash flow
forecasts under various scenarios, identifying risks and mitigating
factors and ensuring the Group has sufficient funding to meet its
current and contracted commitments as and when they fall due for a
period of at least 12 months from the date of signing these
Financial Statements.
At the balance sheet date and the date of this report, the Group
has surplus cash balances, exceeding debt drawn on the Senior
Secured Borrowing and Junior Debt Facilities within the Egypt
business. The cash surplus has been adjusted for the proposed
$100.0m cash return to shareholders and the remaining balance of
the $25.0m share buy-back programme. After adjusting for these
planned returns, under both Capricorn's and the lenders
assumptions, the Group has sufficient resources to maintain
compliance with the financial covenant associated with the
facilities in terms of a 12-month forward-looking liquidity
test.
A downside scenario run includes a return to lower oil prices,
with a 10% reduction to the forward curve over the remainder of
2023 and an oil price of $60 per bbl from 2024 onward, a 10%
reduction in forecast production and further delays in settlement
of Egypt trade receivables. An oil-price crash scenario assumes a
fall in the oil price to $35 per bbl in Q3 2023 with a recovery of
$60 per bbl by mid-year 2024 partially mitigated by a reduction in
forecast capital expenditure. Both the downside and oil price crash
scenarios include the planned $100.0m cash return and remaining
share re-purchase. Under both scenarios the Group has sufficient
cash headroom to continue to operate as a going concern.
Under the terms of the borrowing facilities entered into in
connection with the Group's Egypt assets, Capricorn Egypt Limited,
the subsidiary holding the Egypt assets, as borrows jointly and
severally guarantee the performance of the obligations of the joint
venture counterparty. Should the counterparty fail to meet its
repayment obligations, the lender could enforce this guarantee,
though other routes to recovery would be more likely. Though
considered highly remote, default by the counterparty could result
in the lenders assuming control of the Egypt assets. However, as
the facilities are non-recourse to the rest of the Group, Capricorn
would continue to operate as a going concern with sufficient cash
balances held outside Egypt and further earnout consideration
forecast allowing the Group to meet its remaining liabilities as
they fall due.
1.3 Restatement of Comparative Information
A change in policy from a successful efforts-based accounting
policy to a pure successful efforts accounting policy for oil and
gas assets has been adopted from 1 January 2023. Under the revised
policy, all non-well specific exploration costs, previously
capitalised within exploration assets, are now charged directly to
the Income Statement as incurred. The directors believe that the
revised policy gives a clearer understanding of the performance of
the Group in any given period as the new policy is more closely
aligned to the general capitalisation requirement of the IFRS
framework, by only capitalising costs associated within exploration
assets that directly relate to commercial discoveries of
hydrocarbons. In addition, costs associated with Near Field
Exploration ("NFE") wells, which are appraisal wells within the
existing development areas are now capitalised immediately within
development/producing assets, given that, if successful they start
producing immediately. The directors believe these changes will
provide more reliable and relevant information on the Group's
financial performance in a period and more importantly the value of
exploration assets held at the balance sheet date.
The result of the change in accounting policy is that going
forward only costs of commercially successful exploration wells in
Egypt projects are expected to be capitalised within exploration
assets given the change in the group's future strategy to focus on
maximising value from these assets. The policy change has been
applied retrospectively and restatement of the Intangible
Exploration/Appraisal assets, Income Statement, Balance Sheet, and
statement of Cash Flows including the comparative periods is
presented in the tables below.
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
Adjustments recognised on adoption from successful efforts-based
to a pure successful efforts-based costs policy. Reconciliation to
Intangible Exploration/Appraisal assets is as follows:
Intangible Exploration/Appraisal Accounting Intangible Exploration/Appraisal
assets policy assets
old policy change new policy
$m $m $m
---------------------------------- --------------------------------- ----------- ----------------------------------
Cost
At 1 January 2022 117.9 (88.5) 29.4
Additions 43.8 (24.2) 19.6
Unsuccessful exploration costs (28.7) 6.0 (22.7)
At 30 June 2022 133.0 (106.7) 26.3
Additions 46.6 (28.8) 17.8
Unsuccessful exploration costs (84.4) 41.3 (43.1)
At 31 December 2022 95.2 (94.2) 1.0
Additions 42.4 (24.0) 18.4
Unsuccessful exploration costs (71.0) 52.4 (18.6)
At 30 June 2023 66.6 (65.8) 0.8
---------------------------------- --------------------------------- ----------- ----------------------------------
Impairment
At 1 January 2022 19.6 (11.6) 8.0
Charge for the period 24.5 (7.1) 17.4
---------------------------------- --------------------------------- ----------- ----------------------------------
At 30 June 2022 44.1 (18.7) 25.4
Unsuccessful exploration costs (19.6) 11.6 (8.0)
Disposal/Reversal of charge for
the period (24.5) 7.1 (17.4)
At 31 December 2022 and 30 June
2023 - - -
---------------------------------- --------------------------------- ----------- ----------------------------------
Net book value
---------------------------------- --------------------------------- ----------- ----------------------------------
At 30 June 2022 88.9 (88.0) 0.9
---------------------------------- --------------------------------- ----------- ----------------------------------
At 31 December 2022 95.2 (94.2) 1.0
---------------------------------- --------------------------------- ----------- ----------------------------------
At 30 June 2023 66.6 (65.8) 0.8
---------------------------------- --------------------------------- ----------- ----------------------------------
Of the $65.8m accounting policy adjustment $53.3m relates to the
expensing of general exploration costs relating to Mauritania,
Suriname and in the UK as well as non-well costs in Egypt in the
current and prior years. The remaining $12.5m is due to the
reallocation of NFE costs into development/producing assets.
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
1.3.1 Group Income Statement Accounting Policy Restatement
For the six months ended 30 June 2023:
Six months
ended
Six months ended 30 June
30 June Accounting policy 2023
2023 change Restated
Statement of profit or loss (extract) Note $m $m $m
Continuing operations
General exploration costs - (15.8) (15.8)
Unsuccessful exploration well costs 2.2 (71.0) 52.4 (18.6)
Operating loss (71.0) 36.6 (34.4)
Loss before taxation from continuing operations (71.0) 36.6 (34.4)
Tax charge 5.1 (19.5) 0.4 (19.1)
Loss from continuing operations (90.5) 37.0 (53.5)
------------------------------------------------- ----- ----------------- ------------------ -----------
Both basic and diluted earnings per share increased by $0.12 per
share for the period ended 30 June 2023.
For the six months ended 30 June 2022:
Six months ended Six months ended
30 June 30 June
2022 Accounting policy 2022
As originally presented change Restated
Statement of profit or loss (extract) Note $m $m $m
Continuing operations
General exploration costs - (19.9) (19.9)
Unsuccessful exploration well costs 2.2 (28.7) 6.0 (22.7)
Impairment of intangible
exploration/appraisal assets 2.2 (24.5) 7.1 (17.4)
Operating loss (53.2) (6.8) (60.0)
Loss before taxation from continuing
operations (53.2) (6.8) (60.0)
Tax charge 5.1 (24.8) 0.2 (24.6)
--------------------------------------------- ----- ------------------------- ------------------ -----------------
Loss from continuing operations (78.0) (6.6) (84.6)
--------------------------------------------- ----- ------------------------- ------------------ -----------------
Both basic and diluted earnings per share decreased by $0.02 per
share for the period ended 30 June 2022.
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
1.3.1 Group Income Statement Accounting Policy Restatement
(continued)
For the year ended 31 December 2022:
Year ended
31 December Year ended
2022 31 December
As originally presented Accounting policy 2022
(audited) change Restated
Statement of profit or loss (extract) Note $m $m $m
Continuing operations
General exploration costs - (48.7) (48.7)
Unsuccessful exploration well costs 2.2 (93.5) 35.7 (57.8)
Operating loss (93.5) (13.0) (106.5)
Loss before taxation from continuing operations (93.5) (13.0) (106.5)
Tax charge 5.1 (32.0) 1.3 (30.7)
Loss from continuing operations (125.5) (11.7) (137.2)
------------------------------------------------- ----- ------------------------- ------------------ -------------
Both basic and diluted earnings per share decreased by $0.03 per
share for the year ended 31 December 2022.
1.3.2 Group Balance Sheet Accounting Policy Restatement
30 June
30 June Accounting policy 2023
As at 30 June 2023: 2023 change Restated
Balance Sheet (extract) Note $m $m $m
------------------------------------------------------------ ----- -------- ------------------ ----------
Non-current assets
Intangible exploration/appraisal assets 2.2 66.6 (65.8) 0.8
Property, plant & equipment - development/producing assets 2.3 228.0 12.5 240.5
Deferred tax assets 5.2 7.4 1.1 8.5
------------------------------------------------------------ ----- -------- ------------------ ----------
302.0 (52.2) 249.8
------------------------------------------------------------ ----- -------- ------------------ ----------
Non-current liabilities
Deferred tax liabilities 5.2 (16.7) 0.6 (16.1)
------------------------------------------------------------ ----- -------- ------------------ ----------
Net assets 285.3 (51.6) 233.7
------------------------------------------------------------ ----- -------- ------------------ ----------
Equity
Retained earnings 690.5 (51.6) 638.9
------------------------------------------------------------ ----- -------- ------------------ ----------
Total equity 647.4 (51.6) 595.8
------------------------------------------------------------ ----- -------- ------------------ ----------
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
1.3.2 Group Balance Sheet Accounting Policy Restatement
(continued)
As at 30 June 2022:
30 June 30 June
2022 Accounting policy 2022
As originally presented change Restated
Balance Sheet (extract) Note $m $m $m
---------------------------------------------------- ----- ------------------------- ------------------ ----------
Non-current assets
Intangible exploration/appraisal assets 2.2 88.9 (88.0) 0.9
Property, plant & equipment - development/producing
assets 2.3 334.1 4.3 338.4
423.0 (83.7) 339.3
Non-current liabilities
Deferred tax liabilities 5.2 (52.1) 0.2 (51.9)
Net assets 370.9 (83.5) (287.4)
---------------------------------------------------- ----- ------------------------- ------------------ ----------
Equity
Retained earnings 869.8 (83.5) 786.3
---------------------------------------------------- ----- ------------------------- ------------------ ----------
Total equity 1,308.5 (83.5) 1,225.0
---------------------------------------------------- ----- ------------------------- ------------------ ----------
As at 31 December 2022:
31 December 2022 31 December
As originally presented Accounting policy 2022
(audited) change Restated
Balance Sheet (extract) Note $m $m $m
-------------------------------------------------- ----- ------------------------- ------------------ ------------
Non-current assets
Intangible exploration/appraisal assets 2.2 95.2 (94.2) 1.0
Property, plant & equipment -
development/producing assets 2.3 249.5 4.3 253.8
Deferred tax assets 5.2 7.1 0.5 7.6
351.8 (89.4) 262.4
Non-current liabilities
Deferred tax liabilities 5.2 (30.9) 0.8 (30.1)
-------------------------------------------------- ----- ------------------------- ------------------ ------------
Net assets 320.9 (88.6) 232.3
Equity
Retained earnings 771.8 (88.6) 683.2
-------------------------------------------------- ----- ------------------------- ------------------ ------------
Total equity 1,214.6 (88.6) 1,126.0
-------------------------------------------------- ----- ------------------------- ------------------ ------------
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
1.3.3 Group Statement of Cash Flows Accounting Policy
Restatement
For the six months ended 30 June 2023:
Six months ended
Six months ended 30 June
30 June Accounting policy 2023
2023 change Restated
Statement of cash flows (extract) $m $m $m
------------------------------------------------------------ ----------------- ------------------ -----------------
Cash flows from operating activities:
Loss before taxation from continuing operations (68.9) 36.6 (32.3)
------------------------------------------------------------ ----------------- ------------------ -----------------
Adjustments for non-cash income and expense and
non-operating cash flows:
Unsuccessful exploration costs 71.0 (52.4) 18.6
Net cash flows from operating activities 71.0 (52.4) 18.6
------------------------------------------------------------ ----------------- ------------------ -----------------
Cash flows from investing activities:
Expenditure on intangible exploration/appraisal assets (28.8) 15.8 (13.0)
------------------------------------------------------------ ----------------- ------------------ -----------------
Net cash flows used in investing activities (28.8) 15.8 (13.0)
------------------------------------------------------------ ----------------- ------------------ -----------------
Net decrease in cash and cash equivalent 453.9 - 453.9
------------------------------------------------------------ ----------------- ------------------ -----------------
For the six months ended 30 June 2022:
Six months ended
30 June Six months ended
2022 30 June
As originally presented Accounting policy 2022
2022 change Restated
Statement of cash flows (extract) $m $m $m
---------------------------------------------------- ------------------------- ------------------ -----------------
Cash flows from operating activities:
Loss before taxation from continuing operations (48.7) (6.8) (55.5)
---------------------------------------------------- ------------------------- ------------------ -----------------
Adjustments for non-cash income and expense and
non-operating cash flows:
Unsuccessful exploration costs 28.7 (6.0) 22.7
Impairment of intangible exploration/appraisal
assets 24.5 (7.1) 17.4
Net cash flows from operating activities 53.2 (13.1) 40.1
---------------------------------------------------- ------------------------- ------------------ -----------------
Cash flows from investing activities:
Expenditure on intangible exploration/appraisal
assets (58.4) 19.9 (38.5)
---------------------------------------------------- ------------------------- ------------------ -----------------
Net cash flows used in investing activities (58.4) 19.9 (38.5)
---------------------------------------------------- ------------------------- ------------------ -----------------
Net increase in cash and cash equivalent 493.0 - 493.0
---------------------------------------------------- ------------------------- ------------------ -----------------
Section 1 - Basis of Preparation (continued)
1.3 Restatement of Comparative Information (continued)
1.3.3 Group Statement of Cash Flows Accounting Policy
Restatement (continued)
For the year ended 31 December 2022:
Year ended Year ended
31 December 2022 31 December
As originally presented Accounting policy 2022
(audited) change Restated
Statement of cash flows (extract) $m $m $m
------------------------------------------------------ ------------------------- ------------------ ---------------
Cash flows from operating activities:
Loss before taxation from continuing operations (128.3) (13.0) (141.3)
------------------------------------------------------ ------------------------- ------------------ ---------------
Adjustments for non-cash income and expense and
non-operating cash flows:
Unsuccessful exploration costs 93.5 (35.7) 57.8
Net cash flows from operating activities 93.5 (35.7) 57.8
------------------------------------------------------ ------------------------- ------------------ ---------------
Cash flows from investing activities:
Expenditure on intangible exploration/appraisal
assets (94.9) 48.7 (46.2)
------------------------------------------------------ ------------------------- ------------------ ---------------
Net cash flows used in investing activities (94.9) 48.7 (46.2)
------------------------------------------------------ ------------------------- ------------------ ---------------
Net increase in cash and cash equivalent 447.8 - 447.8
------------------------------------------------------ ------------------------- ------------------ ---------------
Section 2 - Oil and Gas Assets and Operations
2.1 Gross Profit: Revenue and Cost of Sales
Six months Year
ended Six months ended ended
30 June 30 June 31 December
2023 2022 2022
$m $m $m
------------------------------------------ ----------- ----------------- -------------
Oil sales 76.6 112.9 181.4
Gas sales 21.7 24.5 47.5
------------------------------------------ ----------- ----------------- -------------
Revenue from oil and gas sales 98.3 137.4 228.9
Royalty income 0.5 - 0.7
------------------------------------------ ----------- ----------------- -------------
Total revenue 98.8 137.4 229.6
------------------------------------------ ----------- ----------------- -------------
Other Income - Tax entitlement volumes 29.8 23.0 54.8
------------------------------------------ ----------- ----------------- -------------
Other income 29.8 23.0 54.8
------------------------------------------ ----------- ----------------- -------------
Production costs and inventory movements (27.5) (32.8) (71.2)
------------------------------------------ ----------- ----------------- -------------
Cost of sales (27.5) (32.8) (71.2)
------------------------------------------ ----------- ----------------- -------------
Depletion (note 2.3) (55.1) (72.0) (124.1)
------------------------------------------ ----------- ----------------- -------------
Gross profit 46.0 55.6 89.1
------------------------------------------ ----------- ----------------- -------------
Oil and gas revenue in Egypt for H1 2023, was $98.3m (H1 2022:
$137.4m; YE 2023: $228.9m), from net entitlement volumes of 2.4
mmboe (H1 2022: 2.6 mmboe; YE 2022: 4.7 mmboe). Oil sales price
realised averaged $78.56/boe (H1 2022: $110.9/boe; YE 2022:
$98.8/boe) (excluding expected credit loss adjustments) and gas
sales prices remained at $2.9/mscf (H1 2022: $2.9/mscf; YE 2022;
$2.9/mscf). Other income represents additional entitlement to cover
tax due which is paid on Capricorn's behalf by EGPC; see section
5.
Cost of sales over the period were $27.5m (H1 2022: $32.8m; YE
2022: $71.2m), or $4.8/boe (H1 2022: $5.1/boe; YE 2022: $5.7/boe)
(on a WI basis).
Section 2 - Oil and Gas Assets and Operations (continued)
2.2 Intangible Exploration/Appraisal Assets
Other
Egypt Mexico Countries Total
(restated) (restated) (restated) (restated)
$m $m $m $m
-------------------------------------- ------------ ------------ ------------ ------------
Cost
At 1 January 2022 - 25.2 4.2 29.4
Additions 0.9 0.2 18.5 19.6
Unsuccessful exploration costs - - (22.7) (22.7)
At 30 June 2022 0.9 25.4 - 26.3
Additions (0.9) 1.0 17.7 17.8
Unsuccessful exploration costs - (25.4) (17.7) (43.1)
At 31 December 2022 - 1.0 - 1.0
Additions 3.0 14.6 0.8 18.4
Unsuccessful exploration costs (2.2) (15.6) (0.8) (18.6)
At 30 June 2023 0.8 - - 0.8
-------------------------------------- ------------ ------------ ------------ ------------
Impairment
At 1 January 2022 - 8.0 - 8.0
Charge for the period - 17.4 - 17.4
-------------------------------------- ------------ ------------ ------------ ------------
At 30 June 2022 - 25.4 - 25.4
Reversal of charge for the period - (17.4) - (17.4)
Unsuccessful exploration costs - (8.0) - (8.0)
At 31 December 2022 and 30 June 2023 - - - -
-------------------------------------- ------------ ------------ ------------ ------------
Net book value
-------------------------------------- ------------ ------------ ------------ ------------
At 30 June 2022 0.9 - - 0.9
-------------------------------------- ------------ ------------ ------------ ------------
At 31 December 2022 - 1.0 - 1.0
-------------------------------------- ------------ ------------ ------------ ------------
At 30 June 2023 0.8 - - 0.8
-------------------------------------- ------------ ------------ ------------ ------------
Egypt
As at 30 June 2023, the balance of $0.8m relates to direct cost
relating to planned exploration wells on the South-East Horus
concession area.
Section 2 - Oil and Gas Assets and Operations (continued)
2.3 Property, Plant & Equipment - Development/Producing
Assets
Egypt
(restated)
$m
---------------------------------------- ------------
Cost
At 1 January 2022 405.1
Additions 36.5
At 30 June 2022 441.6
Additions 39.3
Other cost adjustments (29.2)
---------------------------------------- ------------
At 31 December 2022 451.7
Additions 41.8
At 30 June 2023 493.5
---------------------------------------- ------------
Depletion, amortisation and impairment
At 1 January 2022 31.2
Depletion and amortisation charges 72.0
At 30 June 2022 103.2
Depletion 52.1
Impairment 42.6
At 31 December 2022 197.9
Depletion 55.1
At 30 June 2023 253.0
---------------------------------------- ------------
Net book value
---------------------------------------- ------------
At 30 June 2022 338.4
---------------------------------------- ------------
At 31 December 2022 253.8
---------------------------------------- ------------
At 30 June 2023 240.5
---------------------------------------- ------------
Additions on development activity in the period were funded
through cash and working capital.
In Egypt, depletion of $55.1m (2022 H1: $72.0m, 2022 YE:
$124.1m) was charged to the Income Statement based on entitlement
interest production. The costs for depletion include future capital
costs-to-complete consistent with the life-of-field reserve
estimates used in the calculation.
The Group reviewed its producing assets in Egypt for indicators
of impairment, but no indicators were identified and no impairment
tests have therefore been performed at the half-year.
Section 2 - Oil and Gas Assets and Operations (continued)
2.4 Other Property, Plant & Equipment and Intangible
assets
Carbon Intangible Property, plant Right-of-use
credits assets & equipment assets Total
$m $m $m $m $m
------------------------------- --------- ----------- ---------------- ------------- ------
Cost
At 1 January 2022 - 37.4 10.8 9.3 57.5
Additions 6.8 1.9 - 0.2 8.9
At 30 June 2022 6.8 39.3 10.8 9.5 66.4
Additions - 2.0 - 3.3 5.3
At 31 December 2022 6.8 41.3 10.8 12.8 71.7
Additions - 3.8 0.4 16.8 21.0
At 30 June 2023 6.8 45.1 11.2 29.6 92.7
------------------------------- --------- ----------- ---------------- ------------- ------
Depreciation and amortisation
At 1 January 2022 - 35.2 10.3 6.3 51.8
Charge for the period - 1.8 0.1 1.0 2.9
------------------------------- --------- ----------- ---------------- ------------- ------
At 30 June 2022 - 37.0 10.4 7.3 54.7
Charge for the period - 1.7 0.2 1.0 2.9
At 31 December 2022 - 38.7 10.6 8.3 57.6
Charge for the period - 4.2 0.6 1.9 6.7
------------------------------- --------- ----------- ---------------- ------------- ------
At 30 June 2023 - 42.9 11.2 10.2 64.3
------------------------------- --------- ----------- ---------------- ------------- ------
Net book value
------------------------------- --------- ----------- ---------------- ------------- ------
At 30 June 2022 6.8 2.3 0.4 2.2 11.7
------------------------------- --------- ----------- ---------------- ------------- ------
At 31 December 2022 6.8 2.6 0.2 4.5 14.1
------------------------------- --------- ----------- ---------------- ------------- ------
At 30 June 2023 6.8 2.2 - 19.4 28.4
------------------------------- --------- ----------- ---------------- ------------- ------
The total additions of $16.8m in right-of-use assets include
$16.0m addition in connection to additional office lease contracts
in the UK.
2.5 Capital Commitments
At At
At 30 June 31 December
30 June 2022 2022
2023 (restated) (restated)
Oil and gas expenditure: $m $m $m
------------------------------------------------------------ ---------- ------------ -------------
Intangible exploration/appraisal assets 12.6 43.8 28.4
Property, plant & equipment - development/producing assets - 46.3 -
Contracted for 12.6 90.1 28.4
------------------------------------------------------------ ---------- ------------ -------------
Capital commitments represent Capricorn's share of obligations
relating to its interests in joint operations. These commitments
include Capricorn's share of the capital commitments of the joint
operations themselves.
The capital commitments of $12.6m (2022 H2: $2.1m, 2022 YE:
$14.3m) for intangible exploration/appraisal assets related to
Egypt operations.
30 June 2022 the capital commitments for property, plant &
equipment - development/producing assets related to Egypt
operations. At 30 June 2023 and 31 December 2022 no capital
commitments are recorded as operator budgets still to be
approved.
Section 3 - Working Capital, Financial Instruments and Long-Term
Liabilities
3.1 Cash and Cash Equivalents
At At At
30 June 30 June 31 December
2023 2022 2022
$m $m $m
-------------------------------------- --------- --------- -------------
Cash at bank 38.3 99.8 63.4
Bank deposits less than three months 40.0 73.0 298.0
Money market funds 222.7 636.2 395.4
301.0 809.0 756.8
-------------------------------------- --------- --------- -------------
At 30 June 2023, $35.1m of cash and cash equivalents are
restricted and not available for immediate ordinary business use.
Of this restricted amount of cash and cash equivalents $33.9m is
held in Egypt.
3.2 Loans and Borrowings
At At At
30 June 30 June 31 December
2023 2022 2022
Reconciliation of opening and closing liabilities to cash flow movements: $m $m $m
Opening liabilities 158.6 177.0 177.0
Loan repayments in the period disclosed in the Cash Flow Statement:
Senior Debt Facility (33.5) (3.7) (21.5)
(33.5) (3.7) (21.5)
---------------------------------------------------------------------------- ---------- --------- -------------
Non-cash movements:
Accrued debt facility interest (1.1) - 2.2
Amortisation of debt arrangement fees 0.5 0.6 0.9
---------------------------------------------------------------------------- ---------- --------- -------------
Closing liabilities 124.5 173.9 158.6
---------------------------------------------------------------------------- ---------- --------- -------------
Amounts due less than one year 20.3 16.3 25.4
Amounts due greater than one year 104.2 157.6 133.2
---------------------------------------------------------------------------- ---------- --------- -------------
Closing liabilities 124.5 173.9 158.6
---------------------------------------------------------------------------- ---------- --------- -------------
Section 3 - Working Capital, Financial Instruments and Long-Term
Liabilities (continued)
3.3 Lease Liabilities
At At At
30 June 30 June 31 December
2023 2022 2022
Reconciliation of opening and closing liabilities to cash flow movements: $m $m $m
Opening liabilities 4.3 3.7 3.7
Lease payments in the period disclosed in the Cash Flow Statement as financing
cash flows:
Total lease payments (1.5) (1.4) (2.5)
(1.5) (1.4) (2.5)
-------------------------------------------------------------------------------- ---------- --------- -------------
Non-cash movements:
Lease additions 16.0 - 3.2
Lease interest charges 0.2 0.1 0.2
Foreign exchange 0.2 (0.3) (0.3)
-------------------------------------------------------------------------------- ---------- --------- -------------
Closing liabilities 19.2 2.1 4.3
-------------------------------------------------------------------------------- ---------- --------- -------------
Amounts due less than one year 1.1 1.9 1.9
Amounts due greater than one year 18.1 0.2 2.4
-------------------------------------------------------------------------------- ---------- --------- -------------
Closing liabilities 19.2 2.1 4.3
-------------------------------------------------------------------------------- ---------- --------- -------------
At as 30 June 2023 the balance of $19.2m wholly relates to the
office lease costs in the UK and Egypt. Additions of $16.0m in 2023
relates to new office lease liabilities in the UK. Amortisation
charges on the Right-of-Use assets are disclosed in note 4.1.
For the six months ended 30 June 2023 the Group did not incur
any further fixed or variable lease costs.
3.4 Trade and Other Receivables
At At At
30 June 30 June 31 December
2023 2022 2022
$m $m $m
----------------------------- --------- --------- -------------
Trade receivables 144.2 113.6 96.9
Other receivables 13.4 22.8 19.6
Prepayments 4.2 7.7 5.3
Joint operation receivables 35.2 67.7 20.7
197.0 211.8 142.5
----------------------------- --------- --------- -------------
Trade receivables relate to the Group's producing assets in
Egypt. The increase in the receivables position is net of expected
credit loss adjustments of $2.0m. Discussions are ongoing with EGPC
and the operator to manage the receivables position and capital
expenditure in Egypt is being monitored to match incoming receipts.
Other receivables include VAT recoverable in the UK and Mexico.
Joint operation receivables include Capricorn's working interest
share of the receivables relating to joint operations and amounts
recoverable from partners in joint operations.
30 June 30 June
2023 2022 31 December 2022
Reconciliation of opening and closing receivables to operating cash flow movements: $m $m $m
Opening trade and other receivables 142.5 1,211.2 1,211.2
Closing trade and other receivables (197.0) (211.8) (142.5)
-------------------------------------------------------------------------------------- --------- ---------- -----------------
(Increase)/Decrease in trade and other receivables (54.5) 999.4 1,068.7
Foreign exchange (0.2) (18.7) (17.3)
India tax refund received - (1,056.0) (1,056.0)
Increase/(Decrease) in joint operation receivables relating to investing activities
for expenditure
on oil and gas assets 27.2 11.1 (27.7)
(Decrease)/Increase in other debtors relating to investing activities (5.3) 1.7 (8.7)
(Decrease)/Increase in prepayments relating to investing activities (1.9) (0.2) 0.6
(Decrease)/Increase in prepayments and other receivables relating to financing
activities (2.0) 0.5 1.7
Increase in trade and other receivables movement recorded in operating cash flows (36.7) (62.2) (38.7)
-------------------------------------------------------------------------------------- --------- ---------- -----------------
Section 3 - Working Capital, Financial Instruments and Long-Term
Liabilities (continued)
3.5 Financial Assets and Liabilities at Fair Value Through
Profit and Loss
At At At
30 June 30 June 31 December
2023 2022 2022
Financial Assets $m $m $m
-------------------------------------------------------------------------------- ---------- --------- -------------
Non-current assets
Financial assets at fair value through profit or loss - earnout consideration 30.1 113.2 89.7
Financial assets at fair value through profit or loss - non-listed investment
fund 6.6 6.0 6.5
-------------------------------------------------------------------------------- ---------- --------- -------------
36.7 119.2 96.2
-------------------------------------------------------------------------------- ---------- --------- -------------
Current assets
Financial assets at fair value through profit or loss - earnout consideration 38.0 127.7 134.4
38.0 127.7 134.4
-------------------------------------------------------------------------------- ---------- --------- -------------
The earnout consideration is due from Waldorf Production UK PLC
following the sale of the Group's UK producing assets in 2021.
At At At
30 June 30 June 31 December
2023 2022 2022
Financial Liabilities $m $m $m
-------------------------------------------------------------------------------- ---------- --------- -------------
Non-current liabilities
Financial liabilities at fair value through profit or loss - deferred
consideration on business
combinations (16.9) (35.7) (36.8)
Current liabilities
Financial liabilities at fair value through profit or loss - deferred
consideration on business
combinations (23.3) (24.6) (25.0)
-------------------------------------------------------------------------------- ---------- --------- -------------
Deferred consideration, based on future oil prices, is due to
Shell following the Egypt business combination in 2021.
Fair Value measurements
At At At
30 June 30 June 31 December
2023 2022 2022
$m $m $m
------------------------------------------------------------ ---------- --------- -------------
Assets measured at fair value - Level 2
Financial assets at fair value through profit or loss
Earnout consideration 68.1 240.9 224.1
Non-listed investment fund 6.6 6.0 6.5
Liabilities measured at fair value - Level 2
Financial liabilities at fair value through profit or loss
Deferred consideration on business combinations (38.5) (58.5) (58.9)
Liabilities measured at fair value - Level 3
Financial liabilities at fair value through profit or loss
Deferred consideration on business combinations (1.7) (1.8) (2.9)
------------------------------------------------------------ ---------- --------- -------------
34.5 186.6 168.8
------------------------------------------------------------ ---------- --------- -------------
Section 3 - Working Capital, Financial Instruments and Long-Term
Liabilities (continued)
3.6 Trade and Other Payables
At At At
30 June 30 June 31 December
2023 2022 2022
$m $m $m
------------------------------------ --------- --------- -------------
Trade payables 0.2 14.4 1.5
Other taxation and social security 2.2 1.3 1.9
Accruals and other payables 9.9 27.6 21.6
Joint operation payables 72.8 94.9 30.7
85.1 138.2 55.7
------------------------------------ --------- --------- -------------
Joint operation payables include Capricorn's share of the trade
and other payables of the joint operations in which the Group
participates. Where Capricorn is an operator of the joint
operation, joint operation payables also include amounts that
Capricorn will settle to third parties on behalf of joint operation
partners. The amount to be recovered from partners for their share
of such liabilities is included within joint operation
receivables.
The reduction in accruals and other payables from the year end
reflects the reduction in bonus and employer national insurance
accruals.
30 June 30 June
2023 2022 31 December 2022
Reconciliation of opening and closing payables to operating cash flow movements: $m $m $m
Opening trade and other payables (55.7) (152.2) (152.2)
Closing trade and other payables 85.1 138.2 55.7
----------------------------------------------------------------------------------- --------- -------- -----------------
Increase/(Decrease) in trade and other payables 29.4 (14.0) (96.5)
Foreign exchange 1.5 3.0 3.4
Decrease in trade payables relating to investing activities 0.7 - 0.5
(Increase)/Decrease in joint operation payables relating to investing activities (31.6) (5.7) 61.6
(Increase)/Decrease in accruals relating to other financing activities -
repurchase of shares (0.8) 18.9 18.7
Decrease in accruals and other payables relating to investing activities - 3.0 3.0
Increase/(Decrease) in accruals and other payables relating to financing
activities 0.2 1.5 (0.5)
(Decrease)/Increase in trade and other payables recorded in operating cash flows (0.6) 6.7 (9.8)
----------------------------------------------------------------------------------- --------- -------- -----------------
Section 4 - Income Statement Analysis
4.1 Segmental Analysis
Segmental Disclosures and Discontinued Operations
The UK producing assets, formerly held within the UK segment,
were classified as held -- for-sale on 8 March 2021, with results
presented as discontinuing operations.
IFRS 8 'Operating Segments' does not provide guidance as to
whether segment disclosures apply to discontinued operations. For
comparative periods, Capricorn has presented segmental disclosures
inclusive of the results of the discontinued operations relating to
the UK producing assets. The current period movements, largely
relating to fair value movements on the earnout consideration due,
are included within the "Other Capricorn Energy Group" segment.
Capital expenditure incurred subsequent to the transfer to
held-for-sale is included within the relevant segment, as it has
been reported to the Capricorn Energy PLC Board, but is deducted
within the group segment adjustment to agree back to balance sheet
additions.
Operating segments
Capricorn's assets are managed through business units which form
the operating segments. Each business unit is or was headed by a
Regional Director (a Regional Director may be responsible for more
than one business unit) and the Board monitors the results of each
segment separately for the purposes of making decisions about
resource allocation and performance assessment.
In 2023 H1, Capricorn had three reporting segments: Egypt,
Mexico, and Other countries. The Other countries operating segment
includes costs associated with exploration interests in Mauritania,
UK North Sea and Suriname.
The Other Capricorn Energy Group segment exists to accumulate
the activities and results of the Parent and other holding
companies together with other unallocated expenditure and net
assets/liabilities including amounts of a corporate nature not
specifically attributable to any of the business units.
Non-current assets as analysed on a segmental basis consist of:
intangible exploration/appraisal assets; property, plant &
equipment -development/producing assets; goodwill; and other
property, plant & equipment and intangible assets.
Section 4 - Income Statement Analysis (continued)
4.1 Segmental Analysis (continued)
The segment results for the six months ended 30 June 2023 are as
follows:
Egypt Mexico Other countries Other Capricorn Energy Group Total
$m $m $m $m $m
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Revenue 98.3 - - 0.5 98.8
Other income 29.8 - - - 29.8
Cost of sales (27.5) - - - (27.5)
Depletion and amortisation charges (55.1) - - - 55.1
Gross profit 45.5 - - 0.5 46.0
Pre-award costs (0.6) - - (0.4) (1.0)
Unsuccessful exploration costs (2.2) (15.6) (0.8) - (18.6)
General exploration costs (4.4) (6.0) (5.4) - (15.8)
Other operating income - - - 0.4 0.4
Depreciation - purchased assets - - - (0.2) (0.2)
Amortisation - right-of-use assets (0.2) - - (1.2) (1.4)
Amortisation of other intangible assets - - - (2.5) (2.5)
Other administrative expenses (0.6) (1.0) - (35.6) (37.2)
Operating profit/(loss) 37.5 (22.6) (6.2) (39.0) (30.3)
Fair value loss on deferred consideration (3.4) - - - (3.4)
Gain on fair value of financial asset - - - - -
Interest income 0.6 1.4 0.1 14.2 16.3
Interest expense (8.1) - - (0.1) (8.2)
Other net finance (expense)/income (0.6) 1.0 (0.6) (6.5) (6.7)
Profit/(Loss) before taxation from
continuing operations 26.0 (20.2) (6.7) (31.4) (32.3)
Tax charge (19.1) - - - (19.1)
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Profit/(Loss) for the period from
continuing operations 6.9 (20.2) (6.7) (31.4) (51.4)
Loss from discontinued operations - - - (10.8) (10.8)
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Profit/(Loss) attributable to equity
holders of the Parent 6.9 (20.2) (6.7) (42.2) (62.2)
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Balances at 30 June 2023:
Capital expenditure 44.7 14.6 0.8 3.8 63.9
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Total assets 500.3 12.6 68.6 303.8 885.3
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Total liabilities 246.2 9.9 5.0 28.4 289.5
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Non-current assets 268.1 0.3 - 26.7 295.1
------------------------------------------ ------- ------- ---------------- ----------------------------- -------
Section 4 - Income Statement Analysis (continued)
4.1 Segmental Analysis (continued)
The segment results for the six months ended 30 June 2022 were
as follows:
Egypt Mexico Other countries Other Capricorn Energy Total
(restated) (restated) (restated) Group (restated)
$m $m $m $m $m
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Revenue 137.4 - - - 137.4
Other income 23.0 - - - 23.0
Cost of sales (32.8) - - - (32.8)
Depletion and amortisation
charges (72.0) - - - (72.0)
Gross profit 55.6 - - - 55.6
Pre-award costs (2.5) - (0.5) (3.3) (6.3)
Unsuccessful exploration
costs - - (22.7) - (22.7)
General exploration costs (3.0) (4.4) (12.5) - (19.9)
Impairment of intangible
exploration/appraisal
assets - (17.4) - - (17.4)
Other operating income - - - 0.1 0.1
Depreciation - purchased
assets - (0.1) - (0.2) (0.3)
Amortisation - right-of-use
assets - (0.1) - (1.0) (1.1)
Amortisation of other
intangible assets - (0.1) - (1.5) (1.6)
Other administrative
expenses (0.2) (0.3) - (30.0) (30.5)
Operating profit/(loss) 49.9 (22.4) (35.7) (35.9) (44.1)
Fair value loss on deferred
consideration (11.2) - - - (11.2)
Gain on fair value of
financial asset - - - 1.5 1.5
Interest income - 0.1 - 3.1 3.2
Interest expense (5.7) - - (0.1) (5.8)
Other net finance
(expense)/income (1.1) 0.7 1.3 - 0.9
Profit/(Loss) before
taxation from continuing
operations 31.9 (21.6) (34.4) (31.4) (55.5)
Tax charge (24.4) - - (0.2) (24.6)
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Profit/(Loss) for the
period from continuing
operations 7.5 (21.6) (34.4) (31.6) (80.1)
Profit from discontinued
operations - - - 120.9 120.9
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Profit/(Loss)
attributable to equity
holders of the Parent 7.5 (21.6) (34.4) 89.3 40.8
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Balances at 30 June 2022:
Capital expenditure 37.3 0.2 18.6 9.3 65.4
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Total assets 588.0 25.0 248.7 793.2 1,654.9
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Total liabilities 376.1 5.4 19.5 28.9 429.9
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Non-current assets 364.6 0.7 (5.9) 17.0 376.4
---------------------------- ------------ ------------ ---------------- ---------------------------- ------------
Section 4 - Income Statement Analysis (continued)
4.1 Segmental Analysis (continued)
The segment results for the year ended 31 December 2022 were as
follows:
Other Capricorn
Egypt Mexico Other countries Energy Total
(restated) (restated) (restated) Group (restated)
$m $m $m $m $m
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Revenue 228.9 - - 0.7 229.6
Other income 54.8 - - - 54.8
Cost of sales (71.2) - - - (71.2)
Depletion and amortisation (124.1) - - - (124.1)
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Gross profit 88.4 - - 0.7 89.1
Pre-award costs (2.8) - (0.8) (5.6) (9.2)
Unsuccessful exploration costs - (17.4) (40.4) - (57.8)
General exploration costs (18.3) (10.1) (20.3) - (48.7)
Impairment of property, plant &
equipment - development/producing
assets (42.6) - - - (42.6)
Other operating income and expenses 4.0 - - 1.8 5.8
Depreciation - purchased assets - - - (0.3) (0.3)
Amortisation - right-of-use assets (0.1) (0.1) - (1.8) (2.0)
Amortisation of other intangible assets - (0.3) - (3.2) (3.5)
Other administrative expenses (0.8) (1.5) - (56.9) (59.2)
Operating profit/(loss) 27.8 (29.4) (61.5) (65.3) (128.4)
Fair value loss on deferred
consideration (12.7) - - - (12.7)
Gain on fair value of financial asset - - - 2.3 2.3
Interest income 0.3 2.3 - 12.4 15.0
Interest expense (13.2) - - (0.2) (13.4)
Other net finance (expense)/income (8.5) 0.7 2.2 1.5 (4.1)
Loss before taxation from continuing
operations (6.3) (26.4) (59.3) (49.3) (141.3)
Tax charge (30.5) - - (0.2) (30.7)
Loss for the year from continuing
operations (36.8) (26.4) (59.3) (49.5) (172.0)
Profit on disposal of discontinued
operations - - - 109.3 109.3
(Loss)/Profit attributable to equity
holders of the Parent (36.8) (26.4) (59.3) 59.8 (62.7)
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Balances at 31 December 2022:
Capital expenditure 46.5 1.3 36.2 10.7 94.7
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Total assets 456.7 21.3 229.3 732.6 1,439.9
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Total liabilities 271.9 5.4 12.3 24.3 313.9
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Non-current assets 280.8 1.5 0.1 11.9 294.3
---------------------------------------- ------------ ------------ ---------------- ---------------- ------------
Section 4 - Income Statement Analysis (continued)
4.2 Administrative and Other Expenses
Year
Six months ended Six months ended ended
30 June 30 June 31 December
2023 2022 2022
$m $m $m
----------------------------------------------------- ------------------ ------------------ -------------
Administrative expenses 34.4 21.2 40.8
Administrative expenses - costs of India tax refund - 12.1 13.1
Other expenses - corporate transactions 6.9 0.2 11.1
41.3 33.5 65.0
----------------------------------------------------- ------------------ ------------------ -------------
Administrative expenses of $34.4m include $13.0m of redundancy
costs. $6.9m in other expenses relate to expenses incurred on
proposed merger which did not complete.
4.3 Finance Income
Year
Six months ended Six months ended ended
30 June 30 June 31 December
2023 2022 2022
$m $m $m
------------------------------------ ------------------ ------------------ -------------
Bank and other interest receivable 16.3 3.2 15.0
Dividend income - 0.3 0.3
Other finance income - - 0.4
Exchange gain - 1.6 -
------------------------------------ ------------------ ------------------ -------------
16.3 5.1 15.7
------------------------------------ ------------------ ------------------ -------------
4.4 Finance Costs
Year
Six months ended Six months ended ended
30 June 30 June 31 December
2023 2022 2022
$m $m $m
------------------------------------ ------------------ ------------------ -------------
Loan interest 8.0 5.7 13.2
Facility fee amortisation 0.5 0.7 0.9
Other finance charges 0.4 0.3 1.2
Unwinding of discount - provisions - - 0.1
Lease interest 0.2 0.1 0.2
Exchange loss 5.8 - 2.6
------------------------------------ ------------------ ------------------ -------------
14.9 6.8 18.2
------------------------------------ ------------------ ------------------ -------------
Section 4 - Income Statement Analysis (continued)
4.5 Earnings per Ordinary Share
Basic and diluted earnings per share are calculated using the
following measures of (loss)/profit:
Year
Six months ended ended
Six months ended 30 June 31 December
30 June 2022 2022
2023 (restated) (restated)
$m $m $m
------------------------------------------------------------- ------------------- ------------------- -------------
Loss and diluted loss after taxation from continuing
operations (51.4) (80.1) (172.0)
(Loss)/Profit and diluted (loss)/profit attributable to
equity holders of the Parent (62.2) 40.8 (62.7)
------------------------------------------------------------- ------------------- ------------------- -------------
The following reflects the share data used in the basic and
diluted earnings per share computations:
Six months ended Year
Six months ended 30 June ended
30 June 2022 31 December
2023 (restated) 2022
'000 '000 '000
------------------------------------------------------------- ------------------- ------------------- -------------
Weighted average number of shares 305,875 414,680 364,470
Less weighted average shares held by the ESOP and SIP Trusts (4,250) (8,136) (7,313)
------------------------------------------------------------- ------------------- ------------------- -------------
Basic and diluted weighted average number of shares 301,625 406,544 357,157
Potentially issuable shares not included above:
LTIP awards 15,752 29,858 29,976
Approved and unapproved plans 222 847 1,124
Employee share awards 2,920 4,884 4,928
Number of potentially issuable shares 18,894 35,589 36,028
------------------------------------------------------------- ------------------- ------------------- -------------
Due to the loss on continuing operations, there is no dilution
of shares in the period. Disclosures for the period ended 30 June
2022 have been restated to remove an erroneous dilution previously
presented.
Section 5 - Taxation
5.1 Tax Charge on (Loss)/Profit for the Period
Year
Six months ended ended
Six months ended 30 June 31 December
30 June 2022 2022
2023 (restated) (restated)
$m $m $m
------------------------------------------------------------- ------------------- ------------------- -------------
Current tax charge:
Overseas corporation tax - Egypt 29.9 23.0 54.8
Overseas corporation tax - India - 0.2 0.2
------------------------------------------------------------- ------------------- ------------------- -------------
Total current tax charge on (loss)/profit from continuing
operations 29.9 23.2 55.0
Deferred tax (credit)/charge:
Reversal of deferred tax charge on recognition of financial
assets - UK - (0.1) (0.1)
Deferred tax (credit)/charge on intangible/tangible assets -
Egypt (10.8) 1.5 (33.8)
Deferred tax charge on non-current assets - Egypt - prior
year adjustment - - 9.6
------------------------------------------------------------- ------------------- ------------------- -------------
Total deferred tax (credit)/charge on (loss)/profit from
continuing operations (10.8) 1.4 (24.3)
------------------------------------------------------------- ------------------- ------------------- -------------
Total tax charge on (loss)/profit from continuing operations 19.1 24.6 30.7
------------------------------------------------------------- ------------------- ------------------- -------------
UK deferred tax (credit)/charge (4.1) 7.8 4.1
------------------------------------------------------------- ------------------- ------------------- -------------
Total deferred tax (credit)/charge on profit from
discontinued operations (4.1) 7.8 4.1
------------------------------------------------------------- ------------------- ------------------- -------------
5.2 Deferred Tax Assets and Liabilities
Reconciliation of movement in deferred tax
assets/(liabilities):
Temporary difference
in respect of
non-current asset
(restated)
$m
-------------------------------------------------- ---------------------
Deferred tax assets
At 1 January 2022 and 30 June 2022 -
Deferred tax credit through the Income Statement 7.6
At 31 December 2022 7.6
Deferred tax credit through the Income Statement 0.9
--------------------------------------------------- ---------------------
At 30 June 2023 8.5
--------------------------------------------------- ---------------------
Section 5 - Taxation (continued)
5.2 Deferred Tax Assets and Liabilities (continued)
Temporary differences in respect of:
Intangible/tangible assets Losses Total
(restated) (restated) Other temporary differences (restated)
$m $m $m $m
------------------------------- --------------------------- ------------ ---------------------------- ------------
Deferred tax liabilities
At 1 January 2022 (51.3) 8.7 (0.1) (42.7)
Deferred tax (charge)/credit
through the Income Statement
- continuing operations (6.3) 4.8 0.1 (1.4)
Deferred tax credit/(charge)
through the Income Statement
- discontinued operations
(note
6.1) - 13.5 (21.3) (7.8)
------------------------------- --------------------------- ------------ ---------------------------- ------------
At 30 June 2022 (57.6) 27.0 (21.3) (51.9)
------------------------------- --------------------------- ------------ ---------------------------- ------------
Deferred tax credit/(charge)
through the Income Statement
- continuing operations 31.7 (13.6) - 18.1
Deferred tax (charge)/credit
through the Income Statement
- discontinued operations
(note
6.1) - (4.4) 8.1 3.7
At 31 December 2022 (25.9) 9.0 (13.2) (30.1)
Deferred tax credit through
the Income Statement -
continuing operations 9.9 - - 9.9
Deferred tax (charge)/credit
through the Income Statement
- discontinued operations
(note
6.1) - (7.0) 11.1 4.1
------------------------------- --------------------------- ------------ ---------------------------- ------------
At 30 June 2023 (16.0) 2.0 (2.1) (16.1)
------------------------------- --------------------------- ------------ ---------------------------- ------------
Deferred tax assets analysed by country:
At At
30 June At 31 December
2023 30 June 2022
(restated) 2022 (restated)
$m $m $m
------- ------------- --------- -------------
Egypt 8.5 - 7.6
8.5 - 7.6
------- ------------- --------- -------------
Deferred tax liabilities analysed by country:
At At
At 30 June 31 December
30 June 2022 2022
2023 (restated) (restated)
$m $m $m
------- ---------- ------------ -------------
Egypt (16.1) (44.1) (26.0)
UK - (7.8) (4.1)
(16.1) (51.9) (30.1)
------- ---------- ------------ -------------
Section 6 - Discontinued Operations
6.1 (Loss)/Profit from Discontinued Operations
Sale of Capricorn's interest in the Catcher and Kraken Producing
Assets ("UK Producing Assets")
On 8 March 2021, Capricorn agreed to sell its interests in the
UK Catcher and Kraken producing assets to Waldorf Production UK
PLC.
Consideration under the agreement was an initial cash
consideration of $425.0m, subject to adjustments for working
capital and other customary interim period adjustments, further
purchaser bonds of $30.0m, sold shortly after completion, and
additional contingent consideration ("earnout consideration") from
2021 to the end of 2025 dependent on oil prices and minimum
production levels being met. 2021 earnout consideration of $75.7m,
plus interest, was settled in June 2022. 2022 earnout consideration
of $134.4m, plus interest, was settled in March 2023. 2023-2025
earnout consideration at 30 June 2023 had a risk-weighted fair
value of $68.1m.
The financial performance of the discontinued operations is
expanded in the tables below for the periods ended 30 June 2023, 30
June 2022 and 31 December 2022 respectively.
Year
Six months Six months ended
ended ended 31 December
30 June 2023 30 June 2022 2022
$m $m $m
--------------------------------------------------------------------- --------------- --------------- -------------
Cost of sales 4.3 1.5 1.5
Operating Profit 4.3 1.5 1.5
(Loss)/Profit on financial asset at fair value through profit or
loss - earnout consideration (21.5) 127.2 110.4
Finance income 2.3 - 1.5
--------------------------------------------------------------------- --------------- --------------- -------------
(Loss)/Profit before tax from discontinued operations (14.9) 128.7 113.4
Taxation 4.1 (7.8) (4.1)
--------------------------------------------------------------------- --------------- --------------- -------------
(Loss)/Profit after tax from discontinued operations (10.8) 120.9 109.3
--------------------------------------------------------------------- --------------- --------------- -------------
Earnings per Share for (Loss)/Profit from Discontinued Operations $ $ $
------------------------------------------------------------------- ------- ----- -----
(Loss)/Profit per ordinary share - basic and diluted ($) (0.04) 0.30 0.31
------------------------------------------------------------------- ------- ----- -----
An audit of the Kraken and Catcher joint operations for the
period from January 2019 to December 2020 resulted in a refund of
production costs from the operator of $4.3m and $1.5m in which has
been credited to discontinued operations in 2023 and 2022
respectively.
The fair value loss in 2023 is mainly due to lower oil prices in
comparison to 2022 oil prices.
6.2 Cash Flow Information for Discontinued Operations
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2023 2022 2022
$m $m $m
---------------------------------------------------- ------------ ----------- -------------
Net cash flows from/(used in) operating activities 4.3 (11.1) (9.6)
Net cash flows from investing activities (1) 136.7 77.2 77.2
Net increase in cash and cash equivalents 141.0 66.1 67.6
---------------------------------------------------- ------------ ----------- -------------
(1) 2022 earnout and interest payment received in March 2023.
2021 earnout and interest payment received in June 2022.
Section 7 - Share Capital
7.1 Called-Up Share Capital
Number 490/143p ordinary
Number 21/13p ordinary '000 21/13p ordinary 490/143p ordinary
'000 $m $m
Allotted, issued and
fully paid ordinary
shares
At 1 January 2022 496,847 - 12.6 -
Issued and allotted for
employee share options 677 - - -
Share re-purchase (182,307) - (4.6) -
At 30 June 2022 315,217 - 8.0 -
Share re-purchase (145) - - -
------------------------- ------------------------ ------------------------- ------------------ ------------------
At 31 December 2022 315,072 - 8.0 -
Consolidation of shares (315,072) 148,534 (8.0) 8.0
Share re-purchase post
consolidation - (4,494) - (0.2)
At 30 June 2023 - 144,040 - 7.8
------------------------- ------------------------ ------------------------- ------------------ ------------------
Share premium $m
------------------------- ------------------------ ------------------------- ------------------ ------------------
At 1 January 2022 490.9
Arising on shares issued
for employee share
options 3.8
------------------------- ------------------------ ------------------------- ------------------ ------------------
At 30 June 2022 494.7
Arising on shares issued
for employee share
options 0.7
------------------------- ------------------------ ------------------------- ------------------ ------------------
At 31 December 2022 495.4
Arising on shares issued
for employee share
options 0.8
Share premium cancelled (495.4)
------------------------- ------------------------ ------------------------- ------------------ ------------------
At 30 June 2023 0.8
------------------------- ------------------------ ------------------------- ------------------ ------------------
A share consolidation completed on 15 May 2023 where existing
ordinary shares of 315,072,439 ordinary shares of 21/13 pence each
were replaced with 148,534,155 ordinary shares of 490/143 pence
each.
The total of $495,386,576 of share premium was cancelled on 23
January 2023.
7.2 Return of Cash to Shareholders
On 27 April 2023, Capricorn announced the proposal to return
approximately $450m to shareholders via a special dividend.
The return was paid to shareholders on 15 May 2023. The return
of cash to shareholders of 115 pence per eligible ordinary share
totalling GBP359.1m. The total return to shareholders, after
exchange differences from the date of conversion from $ to GBP and
associated costs, was $445.7m.
7.3 Share Buyback
In May 2023, the Company commenced a share repurchase programme
of its ordinary shares of up to $25m. For the period ended 30 June
2023, Capricorn repurchased 4,493,877 post consolidation ordinary
shares, totalling GBP9.7m ($12.2m).
Glossary
AESW - Alam El Shawish West
Bbl - Barrel of oil
BED - Badr El Din concession
Boe - Barrels of Oil Equivalent
Boepd - Barrels of Oil Equivalent Per Day
Bopd - Barrels of Oil Per Day
GAAP - Generally Accepted Accounting Principles
G&A - General and administrative expenses
JV - Joint Venture
M - Million
Mmbbls - Million barrels of oil
Mmscf - Million standard cubic feet
$ - US dollar
WI - Working Interest
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