Release Date: November 20, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- NewMed Energy LP (DKDRF, Financial) achieved a record quarter for production, with an average of 1.2 BCf a day.
- The company reported a net profit of $147 million, which is 25% higher than the same quarter last year.
- EBITDA increased to $221 million, indicating strong operational performance.
- Sales to the Egyptian market increased due to debottlenecking activities, enhancing market reach.
- A dividend of $65 million was announced, reflecting strong financial health and shareholder returns.
Negative Points
- The third gathering project experienced a delay of 4 to 6 months, affecting the timeline.
- Higher production costs and taxes offset some of the financial gains.
- Operating expenses increased by $10 million, impacting overall profitability.
- The completion of the Ashdod looping project is delayed until Q4 2025.
- The company faces significant debt, with total debt around $1.7 billion, which could impact future financial flexibility.
Q & A Highlights
Q: Can you provide an overview of NewMed Energy's financial performance for Q3 2024?
A: Unidentified_2: NewMed Energy achieved a record quarter for production, with an average of 1.2 BCF per day. The net profit for the third quarter was approximately $147 million, a 25% increase compared to the same quarter last year. EBITDA reached $221 million. This growth was driven by increased sales, particularly from the Leviathan project, and stable pricing linked to the Brent formula.
Q: What are the key operational updates for NewMed Energy?
A: Unidentified_2: The third gathering line project is delayed and expected to complete by the end of 2025. The Ashdod looping project is also progressing, with completion anticipated by Q4 2025. The company is advancing the Leviathan Phase 1B project, with investment decisions expected in Q2 2025, aiming to bring gas online between mid-2028 and mid-2029.
Q: How is NewMed Energy managing its debt and financial position?
A: Unidentified_3: NewMed Energy has significantly reduced its debt, including the repayment of the Leviathan Bond Series 2023 amounting to $500 million. The total debt stands at approximately $1.7 billion, with bonds maturing in 2025, 2027, and 2030. The company is in a strong financial position, with fixed interest rates positively impacting financial costs.
Q: What are the future investment plans for NewMed Energy?
A: Unidentified_2: NewMed Energy plans to continue its dividend policy while investing in core assets and new opportunities, such as the Morocco activity. The company does not foresee issuing new bonds in the near term but may consider it after the investment decision for Leviathan Phase 2, expected in the second half of 2025.
Q: Can you elaborate on the dividend policy and shareholder returns?
A: Unidentified_2: Since the start of Leviathan's production in early 2020, NewMed Energy has delivered $1 billion in dividends to shareholders. The company aims to maintain this dividend policy alongside investments in core assets and new growth opportunities, ensuring a balanced approach to shareholder returns and business expansion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
