Ithaca Energy plc

Hello, everyone, and welcome to today's Ithaca Energy PLC All Year 2025 Financial Results Call. My name is Seb, and I'll be the operator for your call today. If you'd like to ask a question during the Q&A session, please press star 1 on your telephone keypad. And if you'd like to withdraw your question, please press star 2. I will now hand you over to Yannick Friedman, Executive Chairman, to begin the call. Please go ahead.

Good morning. Thank you, everyone, for joining our full-year 2025 resort presentation and conference call. My name is Yannick Friedman, and I'm the executive chairman of Ithaca Energy PLC. With me on the call today are Luciano Vasquez, CEO, Ian Lewis, our CFO, and Odin Estensen, our COO. I'm on the first slide, and as you can see, we've titled this presentation, Delivering on Our Strategy. And I'm really pleased to say that this has been another year of an excellent set of results and performance. And as you'll see, really executing on all of our pillars. Today's agenda on the next slide. So we'll talk about our vision in action, our proven strategy for supporting value-driven growth, financial update, including our 2026 guidance. and closing remarks to be followed by questions and answers. Vision in action, so we titled this Scales, Development, and Strength. And if you move to slide number four, you'll see the strong operational performance in 2025 delivering on an upgraded production outlook. And I'm going to go through this quickly, but as you can see, we've ticked all the boxes on guidance. So production, net OPEX, CapEx, producing asset CapEx just below the bottom of the range. Same with Rosebank CapEx. Cash tax was again lower than the bottom of the range. And our dividend target of $500 million that was declared and delivered with a $500 million payment cash as well in 2025. If we'll move to slide five, so strong strategic delivery, supporting our vision. If we look at scale, so 119,000 barrels of oil equivalent per day of production. Strong production delivering in line with our upgraded production schedule. Outlook material, 2P reserves and 2C resources base of 658 million barrels. supporting a long-term value creation. Just over $2 billion of adjusted EBITDA, so enhanced financial performance and cash generation in 2025, supporting our capital allocation flexibility and attractive shareholders' returns. As I mentioned, you know, $500 million of full-year 2025 dividends that were declared. And the strength of our balance sheet with $1.5 billion of available liquidity, We've completed a successful €450 million 5.5% bond issuance and an upsizing of our reserve-based lending facility this year as well. It's enhancing our financial strength and flexibility. And we have material financial power for our continued growth with a low leverage position of 0.56x at EBITDAX. Okay. Our vision for scale, stability, and strength in action. So if you look at scale, it's a nice kind of chart that shows the growth of organic and inorganic production through the years. So, you know, if you'll see where we are today, 2025 pro forma production of 131,000 barrels per day reflects organic and inorganic growth. Strong production diversification with no hub representing more than 20% of our production. Exit rates in Q4, 148,000 barrels per day with peaks of above 150,000 barrels per day of production. And we have a balanced performer production mix of almost 50-50 liquids and gas, right? So 52% oil and 48% gas. But this shows the really nice trajectory of our growth. The next slide, and I'm in slide seven, shows the stability element in action, right? So I like this, and we're showing this quite often in our conference calls. So you can see ability to maintain production above 120,000 barrels per day for the foreseeable future. Our material resource base provides us with portfolio longevity and optionality that underpins a long-term production growth. and we focus on high-grading investment opportunities based on returns. So as you can see, we have material resource base, and we'll talk in more detail about our development projects later on in this presentation. Moving to slide eight, strength, 1.5 billion available liquidity. Ian will talk about hedging a bit later in much more detail. But we have a material financial firepower to support our growth with an undrawn reserve-based lending facility of $1.3 billion. Strong hedge protection for cash flows that provides the ability to invest for the long term and sustaining attractive dividend distributions. and high net back capability of our portfolio that provides resilience across the cycle with continued focus on cost control. And as you can see, under $19 per OPEX per DOE, which is a very nice achievement. If we'll move to strategy, and I'll ask you to move to slide 10. So, you know, we'll try and cover all the pillars of our strategy. And as I said, you know, we're successfully executing our value-oriented growth strategy, focusing obviously on optimizing our assets, but also looking at our potential developments and inorganic growth as well. Luciano, why don't you take us through production, safety,

All right. Good morning, everybody. So if we are going now on slide 11, 25 represented a year of outstanding operational performance, significant improvements delivered across all our operational metrics, most notably marked enhancement on the HSC performance. The key takeaways that I want to highlight here are our focus on safe and operational performance, With the introduction of the Perfect Day in 2025, we've talked a lot about it, and it allowed improving all our operational metrics, and we have consistently delivered on all our commitments. The target investment in 2025 increased our production capacity, created the basis for a sustained mid-term production of 120,000 barrels per day. and then the delivery and products of our ongoing and planned investments, which provide robustness for our production outlook mid-term. If we can go to the next slide. First, let me focus, as usual, on our commitment to responsible operation and sustainable value creation, driven by the discipline focus on achieving the perfect day, which I remember is defined a day which has no Tier 1 or Tier 2 process safety incidents and without recordable personal safety injury and without a regulatory reportable event. And I'll talk about the production efficiency in the next slide. This has delivered improvement in safety and environmental performance, and the group recorded zero Tier 1 and Tier 2 process safety events delivered sustained improvement in personal safety performance with a material reduction of over 25% in the total recordable injury rate to 1.7 and it was 2.3 in 24 and 3.3 in 23. The greenhouse gas intensity was 28% lower than last year, primarily due to the higher production delivery from our low intensity assets. which is significantly below the latest basin average of approximately 24 kilogram of CO2 per barrel equivalent. And in 2025, as part of our values relaunch, I want to focus, we introduced a new make it safer value, which resonated well with all our workforce and making sure that safety is always visible in our culture and the front and center of everything that we do. So moving on, slide 13, 2025, as Janice said, has been a year of excellent operation, delivery, and disciplined strategic execution. The strong production reflects the enhanced operational robustness of our asset base first, supported by continued operational improvements and optimization, but above all, a consistent and reliable delivery. For a day to be a perfect one, we also have to meet our production target for the day, and with that focused, the production efficiency performance in 25 was 83%, exceeded the previous year's 80% in 24, and the average of the days in of 75%, including a sustained 4% improvement in the unplanned production efficiency performance across the operated asset. And now we enter 2026 with an increased installed production capacity, having achieved a 25 exit rate, as we said, of 148,000 barrels per day, with peak daily above 150, following the successful delivery of new wells, signal, seagull, jay area. And beyond 2026, we expect to maintain production above 120,000 barrels per day in the medium term, reflecting investments in our existing producing asset base, which is Captain, Franklin, Jair, and Cygnus, and, of course, the startup of Rossman Development with material upside from our pre-FID projects. Now, going to assets, if we move to slide 14, I want to touch on Captain Field. I continue to see very high level of activity in 2025. from the execution of the 13th well campaign to the completion of a significant summer shutdown with material backlog reduction, optimization, and life extension activities which were completed. As part of the 13th well campaign, we delivered three new producers, one injector, and the Enhanced Old Recovery Phase II project delivered a production for the subsea wells which was doubled from around 10 to about 20,000 barrels per day, which allowed to reach the highest production rate in recent years. Now the first phase of 14th campaign with two producers and one injector was sanctioned, and it's scheduled to start in Q4 2026 on a back-to-back basis with the 15th campaign. Also, recognizing the importance of CAPTEN as a strategic operated asset, there was a major flotel campaign commenced in mid-25 to support the long-term stability and performance of this asset, so ensuring that the facility remained safe and reliable through its long-term life. Then we decided to extend a safe Caledonian flotel campaign later in the year, executing further critical scope to safeguard longer-term performance. And after more than 300,000 man-hours that we liquidated, then the flotel left the station in February this year If we move to Cygnus in slide 15, Cygnus, remember, is the UKCS largest producing gas field with low emission production, fits very well with the UK need for domestic sustainable gas production, and sits excellently in our portfolio, offering upside potential. Its performance in the year has been the top across our assets, reaching 90% of production efficiency. At the beginning of the year, while we were working on the acquisition of the additional 46% stake, we've been active mobilizing the Valaris Norway rig and have then the well C12 drilled, which came on stream in December and was followed by the C13 spade in. Now, in the year, last year, we have also sanctioned for the two wells, C14 and C15, which are now planned to be spade in in Q2 and Q4, respectively, of 2026. And this goes along further investment potential with further two new infill wells that we intend to sanction in the year and starting the execution of the already sanctioned compression project, which will enhance the production performance of the field and extend the plateau. If we move to the next slide, which is the slide on J area, This is also a good performer of our portfolio, and we benefit there from a rather effective collaboration with the operator Haber. 2025 has been very active for the area. First action was Talbot that was indeed put in stream at the very end of 2024, but then has delivered very strongly both in terms of production rates and plateau duration in 2025. Then soon after, Talbot, Jost and South, a discovery of late 24, was tied back in Q125, a materially supported production. That was followed by two more and few wells in Judy and Judy is flanked, which was brought online in December at the end of the year, and then a stimulation campaign on John has been planned and successfully executed in the year. All these investments, initiatives in the area, characterized by short time to market, quick payback, have allowed the JLA to achieve its highest average production in 10 years, which makes above 20,000 barrels per day. And if I want to move to Seagull on slide 17, following the acquisition from JAPEX UK in July 2025, now our equity in Seagull field increased from 35% to 50%. equaling our partner BP's interest. At Segal, the fourth and final plant well was completed, started up in November 25 after an extended well completion operation, and the completion of J4 well marked the transition of Ithaca's energy role as development well operator now to a non-operated owner, and BP now is the operator. The early world performance of G4 has been very strong, in line with expectation, and operational efficiency of Segal Wells and the ETAP facility, which is the one that Segal is connected to, is operated by BP, was also in line with expectation, with average net performer production at around 14,000 bar per day. And moving to Ross Bank, our key project being operated by Adura, Material projectivity was executed in 2025, including the successful delivery of offshore subsystem installation scope that was delivered on time and within budget ahead of the drilling activities which is planned for this year. The FPSO Rossbank recently sailed away from Dubai, having undertaken major refurbishment works over the past two and a half years. and remaining completion and commissioning scopes are now planned during this year as part of the program to moor and hook up infield ahead of the first oil production planned for end 26 or 27. And further environmental information was submitted to the regulator for the development in 2025, and now we await the award of the production concept. and as we enter this full year of development now we need to maintain discipline execution which is going to be critical to deliver the project safely on schedule and within the project cost window with that i give the line back to yaniv jano uh thank you and i and i think it's it's a really really excellent set of you know of results and very strong performance and you can see from