£17.8m market cap
6.85p last close
Egdon Resources is an AIM-listed onshore oil and gas exploration company. The group has conventional and unconventional assets in the UK and access to over 188,000 net shale acres.
Investment summary
IGas has released an initial update on drilling activity at Springs Road, with over 250m of hydrocarbon bearing shale encountered. Pressurised core samples were shown to release gas at atmospheric pressure as can be seen in this video released by IGas. Our last published conventional asset value for Egdon was 12.7p/share and included 3.6p/share of risked value for Biscathorpe-2 which we expect to remove. The valuation of Egdon’s net shale resource (188,000 net acres) remains uncertain but, in our view, has the potential to be worth a risked c 100p/share based on the current expectation of well cost, type curves and forward gas prices, assuming a supportive political and planning backdrop.
Y/E Jul |
Revenue (£m) |
EBITDA (£m) |
PBT (£m) |
EPS (fd) (p) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2017A | 1.0 | (1.2) | (2.2) | (0.7) | N/A | N/A |
| 2018A | 0.8 | (2.2) | (1.7) | (0.8) | N/A | N/A |
| 2019E | 3.2 | 0.1 | (0.6) | (0.2) | N/A | 28.0 |
| 2020E | 4.2 | (0.1) | (2.0) | (0.8) | N/A | 43.2 |
| Last updated on 19/03/2019 | ||||||
Industry outlook
The UK government’s stance towards shale varies by party. However, current central government appears to be supportive of unconventional gas development, attracting sector investment from the likes of Centrica and Ineos.
Last updated on 19/03/2019
Sector |
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| Oil & gas |
Share price graph
Balance sheet |
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| Forecast net cash (£m) | 0.9 |
| Forecast gearing ratio (%) | N/A |
Price performance
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Key management |
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| Philip Stephens | Chairman |
| Mark Abbott | MD |
