Hurricane Energy (HUR)

Business description

Hurricane Energy is an E&P focused on UKCS fractured basement exploration and development. It owns 100% of its licences, including the 523mmbbl (RPS 2P reserves plus 2C resources) Lancaster oil discovery, West of Shetland.

Stock data

Market cap.£773.1m
Last close39.46p
High / Low (52 weeks)67.0p / 24.0p
Stock market listingLN
Forecast net cash (£m)200.7
Forecast gearing ratio (%)N/A
TeamResources - Oil & Gas
SectorOil & Gas

Price performance

%1m3m12m
Actual19.42.1(30.8)
Relative *12.26.1(33.6)

* % Relative to local index

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Company news

Y/E Dec Revenue (£m) EBITDA (£m) PBT (£m) EPS (p) P/E (x) P/CF (x)
2015A 0.0 (5.4) (5.5) (0.9) N/A N/A
2016A 0.0 (6.5) (4.7) 0.1 394.6 N/A
2017E 0.0 (7.2) (5.7) (0.4) N/A N/A
2018E 0.0 (7.2) (18.1) (0.9) N/A N/A

Last updated on 27/03/2018

Investment summary

Management’s concept selection and contracting strategy appears to deliver the desired result, with Hurricane reiterating that the Lancaster EPS remains on time and on budget and first-oil scheduled for H119. Market focus is likely to remain on installation items during the 2018 weather window and then to technical data established once production has stabilised. These data are likely to significantly increase our understanding of Greater Lancaster Area (GLA) resource recovery potential and value. Our last published valuation stands at RENAV 78.4p/share, including a Lancaster EPS-only valuation of 32.7p/share based on a long-term (2022) oil price assumption of $70/bbl Brent. We expect little change to our valuation, but will revise our financial forecasts shortly to reflect capex phasing and a change in reporting currency from £ to US$.

Last updated on 10/04/2018

Industry outlook

Hurricane's Lancaster EPS development benefits from the recent recovery in Brent crude and is forecast to generate a point-forward IRR of c 40% based on our commodity price assumptions. Hurricane has successfully de-risked Lancaster through a multi-well appraisal programme.

Last updated on 06/04/2018

Key management

Dr Robert Trice, CEO
Alistair Stobie, CFO

Company address

The Wharf Abbey Mill Business Park
Lower Eashing
Godalming
Surrey
GU7 2QN
United Kingdom
+44 1483 862 820
View website