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Kosmos Energy Ltd on Monday reported a ‘strong’ second quarter, with total production at the upper end of guidance, swinging to quarterly profit.
For the three months that ended on June 30, Kosmos booked total revenue of $620.9 million, up 62% from $384.1 million a year earlier. Net production in the quarter averaged about 62,200 barrels of oil equivalent per day, at the upper end of guidance. For all of 2022, Kosmos is guiding 63,000 to 67,000 barrels equivalent per day.
The oil company is focused on Ghana, Guinea and the US Gulf of Mexico. It swung to a pretax profit of $194.2 million from a loss of $63.7 million. Kosmos generated a net income of $117.2 million during the quarter, compared to a loss of $57.2 million a year earlier.
Exploration expenses jumped to $89.6 million from $9.3 million a year earlier.
Chief Executive Officer Andrew Inglis said: ‘Kosmos delivered another quarter of strong operational and financial performance. Production at the upper end of guidance and continued free cash flow delivery helped reduce debt and drive net leverage lower.’
The company said net capital expenditure for the period was about $220 million, reflecting a $20 million increase from guidance. It explained that this was due to ‘inflationary pressures primarily related to activity in Mauritania and Senegal’. Kosmos guided for capital expenditure in all of 2022 to be around $700 million, up from $670 million previously.
Looking ahead, Kosmos said it expects full-year free cash flow generation and debt reduction to be in line with previous guidance. It is targeting a net leverage ratio of less than 1.5 times by year-end.
Shares were untraded at 480.00 pence each on Monday morning in London.
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