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  • Writer's pictureMark Watson-Mitchell

Serinus Energy – big drop in commodity prices slashes profits in Q1, is now the time to buy

The Q1 results from Serinus Energy (LON:SENX) for the three months to end March 2023 have shown a massive decrease in net income from a positive $1.045m last year to a negative $1.269m this year.


Revenues in Q1 came out at $4.9m ($13.4m), slashing EBITDA to $0.4m ($3.1m) for the period.


The group which has resource interests in Romania and Tunisia endured a significant operating netback decrease, in line with commodity prices, coming out at $39.52 boe against $148.88 boe for last year.


The Jersey, Channel Islands-based Serinus Energy engages in the exploration and development of oil and gas properties in Tunisia and Romania.


It owns a 100% deemed working interest in the Satu Mare concession covering an area of approximately 729,000 gross acres situated within the Pannonian Basin, Romania.


In Tunisia the company holds a 45% working interest in the Sabria concession, which covers an area of approximately 26,195 gross acres; a 100% working interest in the Chouech Es Saida concession covering an area of approximately 52,480 acres; and a 100% working interest in the Ech Chouech concession, which covers an area of approximately 33,920 acres.


On the back of the Q1 results the company’s shares fell 25% to 4.25p, valuing the equity at just £5.0m.


A research note from broker Zeus Capital’s analyst Daniel Slater is anticipating quite a newsflow from the company over the next few months.


He considers that based upon the existing asset position, the company’s ongoing work programme and that expected newsflow, he rates the shares positively and has put a total risked NAV of 40p on the shares.


Over at Shore Capital their analyst Craig Howie continues to see scope for very considerable value to be unlocked, he previously had a 70p a share risked NAV but that was before he reanalyses the company after the Q1 results.


At just 4.25p perhaps now is the time to buy a few and tuck them away awaiting the good news to come over the next few months, they were up to 19p this time last year.

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