Horizon 2023 Financial and Operational Overview

Jun 9, 2024

Mindmap

Horizon 2023 Financial and Operational Overview

1. Key Highlights

  • Revenue & Production
    • 46% increase in revenue ($152M USD)
    • 44% increase in production (1.9M barrels)
  • Profitability & Shareholder Returns
    • EBITDA: $103M USD
    • Free cash flow generation leading to $56M AUD in declared dividends (25% yield for the year)
    • Sustainable dividend distribution: Over $150M AUD distributed in the last 3 years (60% of market cap)
    • Consistent 20% dividend yield for 3 consecutive years
  • Investment in Growth
    • Continued investment in production growth within asset base

2. Company Overview

  • Corporate Structure
    • Based in Australia
    • Assets: 26.95% working interest in Block 2212 offshore China, 26% non-operated interest in Maori field offshore New Zealand
    • Production: approx. 4,500 barrels net to Horizon
    • Strong balance sheet: $35M net cash at end of FY
  • Strategy
    • Focus on maximizing free cash flow generation
    • Commitment to returns to shareholders
    • Invest in production growth within existing assets
    • Explore opportunistic growth outside of portfolio

3. Operational Efficiency

  • Cost Management
    • Low cash operating costs: <$20 USD per barrel
    • High selling price: >$85-$90 per barrel
  • Dividend Announcements
    • Interim dividend: 1.5 cents
    • Final dividend: 2 cents (August)
    • Total: 25% dividend yield

4. Major Investments and Developments

  • China Field (Block 2212)
    • $30M investment in satellite field development (12-8 East field)
    • Production doubled from this field
    • Future opportunities in infill drilling and water handling upgrades
    • Payback periods: 6-12 months for wells cost around $10M USD
    • Sustaining production: invest in infill wells to maintain high production
  • Maori Field
    • 20% of Horizon’s cash flow
    • Sustained production through water injection
    • Potential extension of the permit to maintain production

5. Financial Performance and Market Position

  • Share Register and Price
    • Market cap: approx. $270M
  • FY23 Highlights
    • 55% 2P reserves replacement
    • 44% increase in daily production (5,000 barrels per day)
    • Strong safety record
    • ESG: Net zero ambition and investment in carbon removal credit developer

6. Conclusion and Future Outlook

  • Strong Performance
    • Exceptional year delivering significant value to shareholders
  • Outlook for FY24
    • Continued strong production rates
    • Strengthening oil prices bode well for future cash flow
  • Focus Areas
    • Bringing pipeline of infill wells into production
    • Maintaining low-cost operations in Maori field
    • Sustaining free cash flow and significant returns through dividends
    • Exploration of new business opportunities

Closing Remarks

  • Commitment to continuing generating value and delivering significant returns through future dividends.
  • Focus on sustainable, long-term growth.

[Applause]