said it has made “significant strides” in terms of operational and financial progress in FY19 since acquiring the Nigerian Assets in November 2019.
In results for the year ended 31 December 2019, which include around six weeks of operations in Nigeria, the company posted a pre-tax loss of $105.4m (FY18: $24.6m).
The loss was offset by an overall gain on acquisition of US$10.2m arising from the excess of the fair value of net assets acquired over the fair value of consideration paid, it noted.
The energy firm recognises that its results have been impacted by significant transaction costs in relation to its Nigerian Assets acquisition with exceptional items totalling $75.5m, including a fair value adjustment of $54.7m and transaction expenses of $29.7m.
Savannah reported FY 2019 maiden revenues of $17.8m, comprising $16.9m of gas sales and $0.9m of liquids sale and said it expects revenue to jump to more than $200m in 2020.
Average gross daily production from the Nigerian Assets increased 18% in H1 2020 to an average of 21.3 Kboepd versus 18.1 Kboepd for H1 2019. The group expects to reach an average gross production of 21 to 23 barrels of oil equivalent per day (“Kboepd”) in FY2020.
Shares in Savannah Energy have traded solidly over the past month and opened today at 7.6p.
Cash collection from the Nigerian Assets in 1H 020 increased to $82.1m compared to $55.3m in H1 2019 while the group’s cash balance as at 30 June 2020 totalled $54m.
CEO, Andrew Knott, said 2019 was “a pivotal year” and that the Nigerian Asset acquisition had transformed Savannah into a highly cash flow generative full cycle energy company.
“Since acquiring the Nigerian Assets, we have made significant strides in terms of operational and financial progress, as seen with the strong production figures and robust cash collections in H1 2020, further strengthened our leadership team and stand poised to capitalise on the numerous opportunities that our asset portfolio in Nigeria and Niger presents us with.”
“The countries in which we operate both have enormous potential, and we are proud of the work we have done to date, exemplified by the fact that we are already supplying gas to over 10% of Nigeria's power generation capacity,” said Chairman, Steve Jenkins.
The company remains “optimistic” about the future of business and said it will continue to integrate its Nigerian assets with a focus on group-wide ESG performance going ahead.
Savannah Energy added that it believes its projects in both Nigeria and Niger make “an overwhelmingly positive impact” on the socio-economic development of both countries.
“Our Company has achieved so much since formation seven years ago and I expect this progress to continue in the years to come,” said Knott.
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