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Supper results from Serica, keeping the production at the same level when expecting it would higher, has dented apetite for the stock. Nevertheless well undervalued by the profitt and cash no debt.


SQZ 27p - 0.50p

Serica reports $10.3m profit

Serica Energy made a profit after tax of US$10.3 million in the first half, compared with loss of US$2.8 million the year before.

Sales revenues were US$21.9 million, up from US$5.7 million a year ago, at average realised prices of US$51.5/bbl for oil and approximately 42 p/therm for gas.

Cash and short-term deposits increased to US$30.7 million with zero debt.

Erskine full-year production guidance has been maintained at 2,200-2,400 boepd net notwithstanding the suspension of production in August/September for facilities and pipeline maintenance.

Production re-started on 22 September 2017 achieving rates of approximately 2,500 boepd net to Serica from three wells.

Tony Craven Walker, Serica's chairman, said: "Serica has produced a strong set of first half results and, although production to-date in the second half has been reduced to resolve various pipeline and maintenance issues, our production guidance for the full-year remains in the 2,200-2,400 boepd net range. We are now entering the winter months in the northern hemisphere, when hydrocarbon prices are traditionally stronger and this helps to underpin our financial performance.

"With this strong financial position Serica is well placed to take advantage of new opportunities to grow both through our existing portfolio and through acquisition in the UK North Sea, where our demonstrated capability and experience give us a competitive edge and where we continue to benefit from tax efficiencies. We have adopted a keen but measured approach to this potential and are currently actively reviewing a small number of value accretive opportunities that match our strategic objectives."

Impressive chart rebound from the lows.