Energean plc

morning ladies and gentlemen and welcome to the energy in half year 2026 results call after the speaker's remarks there will be a question and answer session if you have a question we ask that you please use the raise hand function at the bottom of your zoom screen if you are joined by a zoom browser please click the reactions button at the bottom of your zoom page and select raise hand if you have dialed in by phone please use star 9 on your keypad to raise your hand and star 6 to unmute For those watching our live stream, we ask that you please use the ask a question tab in the top right hand of your player to ask your anonymous question. We will repeat these instructions before we begin the Q&A section of this call. I will now hand over to Energy's CEO, Matheus Rigas. Please go ahead.

Good morning, everyone, and thank you for joining our half-year results call today. If we may start with the first slide of the presentation, please. so i would like to start with some introductory remarks i'll hand over to panels to go through our financial results and then i'll pick up again to go through our operations and business outlook the first half was a very strong half for energy we're entering the second half of 26 for a position of real strength three cash flow is up 33 36 percent profits after tax up net debt down and all while we're in the peak of our investment program of catalan the first half obviously we saw the shutdown due to the security issues in israel but that's behind us we're already exceeding 180 000 barrels of oil equivalent production in august all our operations are doing extremely well israel we're seeing strong gas demand oil production is up following the second oil train that we completed and all our business units are performing at or above expectations egypt that i will focus on a lot more today we have a new investment program that i would outline later and that is the next phase of our organic growth beyond that we are focused on our exploration activities in greece and the other parts of the portfolio and the inorganic opportunities that will form a core part of our growth strategy going forward so overall a very strong first half with the second half being even stronger leading us to the very positive results that we are announcing today with that let me hand over to panels to take you over take you through the numbers and then i'll come back to go through the business thank you

Thank you, Mathieu. Good morning, everyone. Moving to the next slide, please. And as per Mathieu's introduction, the company recorded the solid first half of the year, despite the high volatility of political environment our assets are located, and the 41 days of shutdown of production in our largest producer. More specifically, our production was down 12% compared to last year, mainly driven by that shutdown in our career asset. but the total top line was down by only 8% as the production impact was partially offset by the higher oil prices you will see however gas prices in the first half were lower compared to the same period in 2025 but with the current strength of European gas prices we expect 2026 gas revenues to catch up if not surpass the equivalent of 2025 moving to the next slide and to our cost line analysis we have managed to keep our cost base well under control and within budgets and guidance despite the high inflationary environment in all countries of operation that resulted in a six-month epitax of just five percent off the 2025 results and combined with some favorable movements in effects with a strengthening of the dollar and lower taxation we recorded a 45 percent increase for profit after tax at 160 million another important metric is the increased operating cash flow to over half a billion 550 million driven by the reduction in eGPC receivables from 215 million in the start of the year down to only 75 we're now seeing an impressive normalization of eGPC receivables and we are now more confident than ever on the strength of our assets in the country. As expected, CapEx has been at $350 million, well within our 2026 guidance and reflecting progress to our Catalan project, with CapEx continues to be both deferred and managed in the most cost-effective way, recording only $4 million spent in the first half of the year. Finally, another metric, our free cash flow, which includes both cash flow from operations and cash flows from investing, recorded an impressive number of over 350 million the first half of the year, which is 35% higher on the same period last year. Next page, please, moving to page seven. A little bit more details of our net cash flow performance for the period. again highlighting that this 88 million of their cash flow was delivered in a period that our largest producer was down for more than 40 days the catalan project in full capital intensive mode and european gas prices relatively softer on the same period last year but of course the half a billion of cash flow from operation gave us the chance to fully fund all our projects interest and coupons and dividends as well as reduce our debt by almost 50 50 million next page eight a very repetitive slide for those that follow us the last few years but extremely important to explain our difference in debt capital structure As we're currently in a capital-intensive period with our Catalan project, we expect our leverage ratio to stay around the 2.5 to 3 times range, but with a relatively long weighted average life of debt of our target being consistently more than five, ideally more than six years, and a competitive, given both the sector and the country risk, weighted cost of debt of circa 7%. but what gives us the ability to have this favorable debt profile clearly the ownership of the ownership of more than a billion worth of floater the only one fully operational in the med the 18-year reserve life one of the longest compared with our peers and more than 20 billion contracted top line through low-term gas contracts in israel and egypt with floor price and take-home-pray provisions running well into the late 30s. But I want to clarify something for the abundance of any doubt, and despite this obvious strength of our assets and contracts, our medium-term leverage target is not to stay at three times, but it is to bring it down to two times, and we expect that after the completion of the Kaplan project, this is the target of our company. finally page 9 our guidance for the full year 2026 shouldn't surprise anyone if we can move to the next slide please thank you those figures shouldn't surprise anyone as we're still aiming for a production of more 130 000 pounds a day um our cost base to stay at around 300 million with 200 million of royalties and a gna at the usual 35 million range that hasn't really changed uh the last few years on developer topics we expect progress to catalan to continue as planned so we keep our guidance at around 800 million 800 850 million mark but we revised both our exploration and decommissioning expenditure where we do see scope for even further reductions by the end of 2026. Finally, we keep our net debt guidance at around the 3.3 billion mark. We're given our ongoing projects. We are at peak net debt expected to soften as we progress and as the Catalan startup and the Catalan project is completed.