Serica Energy Reports Lower First-Half 2024 Profits Amid Tax Charges and Production Challenges

Serica Energy reported a drop in profits for the first half of 2024, attributing this to a significant tax charge and production disruptions. The company's full-year production is expected to be at the lower end of its forecast, although capital expenditure remains on track. Despite challenges, Serica aims to continue expanding through acquisitions.

Serica Energy posted lower profit for the first half of 2024 on Tuesday, attributing the decline to a substantial tax charge amounting to $106 million.

Production was further impacted by an unexpected shutdown at its Triton Hub in the UK's Central North Sea. As a result, the company produced 43,700 barrels of oil equivalent per day (boepd) during the period, down from 49,350 boepd the previous year.

Given the Triton hub's unplanned downtime, Serica's full-year average production is now expected to fall at the lower end of the previously projected 41-46,000 boepd range. However, the company's full-year capital expenditure is anticipated to be around $260 million pre-tax, within the expected range.

Serica Energy, which has boosted production through recent acquisitions and investments, remains active in pursuing cash-generative M&A opportunities both domestically and in the broader North Sea, as well as other regions.

In late 2022, Serica agreed to acquire North Sea competitor Tailwind Energy Investments for 644 million pounds ($842.87 million), bringing in energy trader Mercuria as its largest investor through the deal and enhancing its production capacity. For the six-month period ending June 30, the London-based firm reported an after-tax profit of $82.5 million, compared to $98.5 million a year earlier.

(With inputs from agencies.)