Maha Energy - EBITDA beat vs. ABGSCe on lower costs

EBITDA beat vs. ABGSCe on lower costs Q1 capex was higher than anticipated Webcast at 16:00CET EBITDA beat vs. ABGSCe on cost control Maha reported Q1’21 production of 3,742 boe/d, spot on with ABGSCe at 3,740boe/d. Revenues of USD 13.

5m is in line with ABGSCe at USD 13. 7m, but a notch below FactSet cons at USD 14. 7m (note that the FactSet consensus is thin, and is not always up to date).

EBITDA of USD 10. 2m is better than ABSGCe at USD 8. 3m, and cons at USD 9.

9m. The beat vs. our numbers is explained by lower costs, as Maha has been able to reduce cost from elevated levels in Q4’20 quicker than expected.

Unit production cost is down from USD 12. 3/boe in Q4 to USD 7. 48/boe in Q1, while SG&A is down from USD 2.

5m to USD 1. 3m. We expect that cons make some adjustments to lower cost base going forwards, to reflect the Q1 beat.

Q1 capex higher than anticipated Q1 capex came in at USD 10. 3m, above ABGSCe at USD 3. 5m.

We expect that the majority of the deviation is timing of spending (ABGSCe FY’21 capex of USD 26m), but it could also be a reflection that Maha now can be more aggressive on investments as it has secured refinancing of its bond through bank debt and equity raise (signed term sheet was announced on 4 February). Due to higher capex, FCF came in at USD -0. 6m, below ABGSCe at 3.

5m. Webcast today at 16:00CET Maha will host a webcast today at 16:00CET. For us, three things will be in focus, production growth in Brazil (specifically how Covid-19 limitations currently affect planned progress), status on bringing the Mafraq field in Oman to production (where Maha now expects drilling to commence in early 2022) and full year capex expectations.