SDX Energy

LN: SDX

£77.8m market cap

38p last close

SDX Energy is a North African E&P listed in Toronto and London. It has oil and gas production in Egypt and gas production in Morocco.

Investment summary

2019 will be an active year for SDX with focus on delivery of first gas at South Disouq, ahead of a return to the drill bit. An eight to nine well programme targets both oil and gas prospectivity in Egypt and appraisal/development locations in Morocco. In Morocco, SDX has an 87% success rate of discovering gas at Sebou based on calibrated 3D seismic. At South Disouq, the development lease has been approved and construction of the pipeline and central facility have commenced. Our updated risked valuation stands at 99.6p/share up from 92.7p/share. Morocco and South Disouq combined make up 67% of our core valuation with contracted sale volumes not levered to the oil price.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2016A 12.9 2.4 (26.7) (8.9) N/A N/A
2017A 39.2 4.1 32.8 14.1 3.5 4.7
2018E 53.1 21.6 12.1 6.6 7.6 2.4
2019E 73.3 35.2 34.2 16.0 3.1 1.6
Last updated on 19/02/2019
Industry outlook

SDX remains open to adding to its portfolio and sees Egypt as a natural market for consolidation, given the large number of small players. Its acquisition of Circle Oil’s Egyptian and Moroccan assets in early 2017 show that it is able to negotiate and complete transactions efficiently.

Last updated on 19/02/2019
Sector
Oil & gas
Share price graph
Balance sheet
Forecast net cash (US$m) 15.9
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual (6.6) (16.2) (22.9)
Relative* (10.7) (18.3) (22.4)
52-week high/low 73.0p/34.1p
*% relative to local index
Key management
Paul Welch CEO
Mark Reid CFO

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