Maha Capital AB (publ)

Hello and welcome to Investor Update, today with Maha Energy, which released its Q1 report for 2025 this morning. Maha's new CEO Roberto Marchiori will be on the link to present the results and current events during the current quarter. Those of you who are watching live can interact with management and ask questions in the top chat. We will handle the questions after the presentation. The presentation will now continue in English. Roberto, nice to see you again. How are things? I'm good. How are you, Carlo? Excellent. Roberto, yet another busy quarter. Please walk us through your presentation.

Okay, thank you very much. And first I would like to thank everyone. It's a pleasure to be here with you. So here we have our Q1 main highlights, starting on the portfolio highlights and start with Brava. We reached during the first quarter of this year, around 21,000 barrels of equivalence day production. And going forward in April, Atlanta, which is one of the main assets offshore, which I will explain later, make two new wells and increase their production even more, reaching up to 82,000 barrels a day. Very positive news on Brava, which I will explain later. On the Illinois-US side, we have the stable production, production around 300 barrels a day, and we reach our lowest OPEX per barrel of $15 a barrel If you compare the last four quarters. A very good and positive news regarding operational side. And in Venezuela, Petro Daneta, we concluded our business plan, which is basically an update on the old business plan. And we see huge and very attractive potential upside there. And mainly we will have 84 million barrels of oil and 167 billion cubic feet of gas. So there's huge potential in terms of the asset. In the financial aspects, we collected $4.4 million by the turnout received from Petro Reconcavou, and also around $200,000 from the Bolivian gas pipeline, which represents around 18% yield, which is also a very positive news on this small investment. On the financial highlights from Maha itself, we have a $1.1 million net back and represented also $2.1 million EBITDA in the period. We ended up the quarter with a very strong balance sheet and capital structure. We have more than $106 million in cash plus liquid investments, and also we are debt-free company. We show here a pretty strong quarter and we are continuing to focus on building this high performance portfolio in order to deliver value to our shareholders going forward. So going to Venezuela, as I mentioned in the previous slide, Petrodoneta business plan was updated during Q2. We have our license period until October 2036, and we can produce in this new business plan around 112 million barrels of equivalent. That means $84 million of oil, and the difference is this 167 billion cubic feet of gas. We are going to work with around 150 wells, so it's a very pulverized and not concentrated wells, and we expect to increase production from 1,000 barrels as of today and reach the peak production of around 4,000 barrels a day of oil equivalent, so oil and gas. And the main assumption behind is, we are going to work with several new technologies. We are basically changing the lifting methods on these existing wells. So basically, we are going to use ESP instead of gas lifting only, which is the technology they have currently, and we will boost a lot and we'll have a lot of associated gas during all these projects going forward. So here we have a huge potential growth uh so we are ramping a production from 1 000 barrels up to 40 000 barrels with a very disciplined capital allocation so we are doing all the investments with a very disciplined approach in order to deploy minimum copies going forward and use newest technologies available in the region And here, the next steps on Venezuela, basically, as I mentioned, we concluded the first step, which was these technical discussions and updating the business plan that was concluded on May this month. And now we are basically waiting for authorizations and also the negotiations of all this set of contracts targeting the same framework agreement as Chevron and the other important companies has in Venezuela to operate. all these fields. And of course, we are going to monitor all this US policy regarding Venezuela and this waiting process, of course, with a very limited cost approach in order to avoid expending lots of money and to have more clarity on these political situations. And now moving on to BRAVA, our major investment. Brava updates regarding Q1. The important message here is they are moving in the right direction. So if you look here in the first chart in the previous quarter, Q4 last year, they were with the offshore business halted with several reasons. But in the end of December, they plugged in Atlanta First Oil. They also restarted Papa Terra and they reached an average of Q1 2025 for around 21,000 barrels a day, which is very impressive, 80% increase. And then in April, after Atlanta, which was only two wells in December, plugged two wells now in April, and the increase even more, reaching up to 82,000 barrels a day. And going forward, they expect to plug additionally 2L. So Atlanta will end up with 6L until June. And this production is expected to increase even more going forward. So that ends with a very strong cash flow generation and the leveraging figures. So solid financials. Brava delivered almost $500 million in revenue. $182 million EBITDA and converting almost 100% of their EBITDA into operational cash flow of around $166 million. And also, it's important to note, BRAVA already completed the offshore CAPEX. So, Atlanta already made all the investments. So, it's expected more positive free cash flow going forward, mainly due to these conclusions. And the onshore side of the business, they are making optimization strategies in order to reduce its CAPEX on the onshore part of the business, considering this new oil low prices environment. So the leveraging strategy is being achieved. They are moving in the right direction, and this will be implemented by growing production, optimized CAPEX, and reducing costs going forward. So they are in the right track. In the next slide, I want to show a little bit on the Brava current valuation. So in this chart, it's easy to see a very significant value gap in the stock price, which was mainly driven by this offshore downtime in the last quarter and also the current branch price. If you've seen the charts, Brava is in the all-time high production, Proforma, considering all the merge with Enalta, but they are almost in the lowest prices ever. This shows us there's still a lot of upside on this position. And here in the next slide, I want to introduce you also, if you compare Marra's, including also our indirect share from Brava's production. So if you compare our current indirect production with our peak production in 2022, we are reaching almost our peak production, but we are trading almost with 70% discount on Marra's share price. So this is also confirming that Marra has a lot of potential upside on valuation as well. Going to Illinois, here we have basically after last year drilling program, we keep sustaining our production almost in a flat curve. Of course, we present a natural decline if you compare Q4 to Q1 now, but this is normal to unconventional wells in the region. And we presented also a net back of $1.1 million, which represents $39 per barrel net back metric, which is almost one of our highest net backs in terms of operational performance. This is also linked to our cost saving initiatives. So we are basically targeting investments and activities that presents returns higher than 25%. And going forward, after this quarter, we are also following all the price rebounds. So we are going to evaluate and see which type of projects and activities can present us returns higher than this 35% IRRs. So we are focusing now in high return projects in the Illinois Basin. Moving on here to financial highlights. Talking about a little bit on production and revenue. So production, as I mentioned before, we face this natural decline on the Illinois Basin after completing the program last year. And the revenue also declined mainly because if you compare to last Q1 2024, also because of the price environment, which has declined the average of WTI. And the production expenses here, we have this very good news. We reached $15 OPEX per barrel is the lowest in the last five quarters. mainly explained by this new cost control efforts that we are doing with the team in the region. And we reached this operating net back of around $1.1 million, representing a very stable and nice cash flow generation with this asset. Going to EBITDA, in the quarter, we have a very strong EBITDA of $2.1 million approximately, mainly explained by the earn-out of $4.4 million collected from Petroleum Concavo, and we end up the quarter with a net result of around $6 million, also supported by the unrealized gain on Brava shares of around $5 million during the quarter. Here, talking about CAPEX embellished, basically, we have very small limited CAPEX because we are, as I mentioned, focusing these high-return projects. And Brava share has performed in US dollars. So if we convert the share price into dollars and make the performance during the quarter, we have this 6.4% increase. So we end up with this robust cash and liquid investment position of $106 million, zero debt. and with total assets of around $136 million and $138 million equity, showing a very strong balance sheet. Going to the cash flow overview, so we started the quarter, or we ended up the last quarter with around $97 million of cash and liquid investment, being 87.5 on liquid investments and around $10 million in cash. And we end up this quarter of Q1 with $106 million of cash and liquid investment being $9.1 million of liquid investment and around $15 million in cash. This is mainly explained by the $4.4 million earn out and also unrealized gain on Brava shares of around $5 million increase in our cash position. And here going to our strategy going forward. So I think we mentioned this during March. We are now very focused on cost reduction initiatives. So we already implemented part of them. So if you look, management and our internal team has been downsized. So I'm accumulating the functions and positions of CEO and CFO in order to save costs. We are already cleaning up corporate structures, so reducing legal entities in order to generate savings going forward, and also this approach of very limited costs associated with these Venezuela projects. And going forward, we are starting this contract negotiations with PDVSA, basically all the set of framework legal documents targeting the similar agreements that Chevron has and the other IOCs. In the meanwhile, we are waiting of a license and other necessary approvals to move forward. And of course, we are still very active, as we also mentioned this new business plan, for sourcing and trying to find very attractive new opportunities in the energy, oil and gas and mineral space. And with that, build a very high performance portfolio in order to generate value to our shareholders. So, and now I conclude here the presentation, Carl. Thank you very much.

Thank you, Roberto. And as always, we received a lot of questions ahead. And there are a couple of questions coming in here. And I just thought that I shall try to pack them in an orderly fashion. So as per 19th of March, Maha would focus on financial investments in the energy and minerals industries with a reduced cost base, as you mentioned. And there is a question here. Would you be looking into investing in minerals as well?