Information from Q2 2016 Misen Energy AB (publ)
Following is a summary of the financial information given in the Q2 2016 report from Misen Energy AB (publ) published today. The complete report is available in both English and Swedish on the Company's website: http://misenenergy.se/repository/Financial_reports_ENG/Misen_Energy_Q2_2016_ENG.pdf
Summary of results:
- Renewed investment program in 2015 has resulted in stable production during the first half of 2016.
- During the first half of 2016 Misen faced lower sales prices combined with increased sub-soil charges and continuously weakening Ukrainian currency, what resulted in consolidated operating group income being lower by 34 % when compared to the first half of 2015 and in consolidated group net turnover being lower by 24 %.
- Accumulated earnings per share for the first half of 2016 were 39 % lower than for the first half of 2015.
- Due to increased sub-soil charges JA investment program fell by 81 % during the first half of 2016 compared to the first half of 2015.
- The Government of Ukraine continued to impose a 70% subsoil use charge for enterprises established under Joint Activity Agreements. This has been done in accordance with the laws adopted in 2014.
- The rate for UAH towards SEK has decreases from 0.3468 on 31 December to 0.3380 on 30 June 2016, or by - 2.5 %.
- Misen Enterprises AB continued to implement an agreement with the JA partner PJSC Ukrgasvydobuvannya regarding the operation of Khrestyshchenska BCS, according to which, the JA has rented out Khrestyshchenska BCS on a monthly basis to PJSC Ukrgasvydobuvannya with an obligation of the latter to compensate the power supply costs needed for operations of BCS.
- On 15 July 2016 PJSC Ukrgasvydobuvannya submitted the Request for Arbitration to the Arbitration Institute of the Stockholm Chamber of Commerce and requested termination of Joint Activities Agreement No. 3 dated 10 June 2002 (as further amended) between PJSC Ukrgasvydobuvannya, LLC Karpatygaz and Misen Enterprises AB.
- On 5 July Misen Energy AB (publ) completed the sale of 37.5 % of the shares and shares capital in its subsidiary Misen Enterprises AB to the Hong Kong based company Powerful United Limited. Misen Energy AB (publ) became to be debt-free and secured financing for the Swedish operation for the period of two years.
January – June 2016:
- Consolidated operating group income: KSEK 41,102 (62,192)
- Consolidated group net turnover: KSEK 393,412 (417,161)
- Earnings per share: SEK 0,11 (0,18)
- Production of natural gas: 332.5 million cubic meters (339.2)
Key events after end of Q2 2016:
- The Company will continue meaningful discussions with Ukraine what regards application of the exorbitant subsoil use charge and its increasing negative effect to the Company’s investments in Ukraine.
- Misen Enterprises AB and LLC Karpatygaz, the two partially owned subsidiaries of Misen Energy AB (publ), will continue to vigorously defend the legitimate interests of their investors in the arbitration proceeding against PJSC Ukrgasvydobuvannya.
For further information, please contact:
Göran Wolff, MD
Misen Energy AB (publ) (formerly Svenska Capital Oil AB (publ)) is a Swedish upstream oil and gas company with operations in Ukraine. The company was founded in 2004 and its shares are traded on Nasdaq First North since 12 June 2007.
In 2011, Misen Energy AB (publ) acquired Misen Enterprises AB and its Ukrainian subsidiary, LLC Karpatygaz, including the rights to 50.01% of the revenue and profit from a gas production project in Ukraine. Under IFRS rules, this transaction is classified as a reverse takeover. In consideration of the acquisition, a new share issue was carried out. The gas producing assets were acquired by production cooperation via a joint activity project governed by a Joint Activity Agreement between at that time the wholly-owned direct and indirect subsidiaries of Misen Energy AB (publ), i.e. Misen Enterprises AB and LLC Karpatygaz (together 50.01%) and PJSC Ukrgasvydobuvannya (49.99%), a subsidiary of the National Joint Stock Company Naftogaz of Ukraine. PJSC Ukrgasvydobuvannya is the largest producer of natural gas in Ukraine. The purpose of the Joint Activity Agreement is to significantly increase production of gas and oil by providing modern technologies via a large-scale investment program for the purposes of attainment of profits.
In June 2016 Misen Energy AB (publ) sold 37.5 % of Misen Enterprises AB shares to the Hong Kong based company Powerful United Limited. Owning (the remaining) 62.5% of Misen Enterprises AB shares, Misen Energy AB (publ) maintains full control of the company and preserves a right to obtain 62.5% of the future dividends from the operations in Ukraine.
The registered office of Misen Energy AB (publ) is in Stockholm and the shares are traded on First North under identification ticker MISE. The Certified Adviser of the company at Nasdaq First North is Consensus Asset Management AB.
For further information, please visit our website www.misenenergy.se.
This information is information that Misen Energy AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 11:30 CET on 31 August 2016.