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22 Feb 21

Surface Transforms (SCE LN) - Investing for the ramp-up

Surface Transforms is now well capitalised following completion of an oversubscribed c.£20m fundraise. Management will move rapidly to develop OEM Production Cell Two to fulfil new and anticipated orders. We update our estimates for the fundraise and the revised investment programme. Sales and gross profit are unchanged, but overheads will be higher in all years reflecting the required investment in the platform to deliver for customers. 2021e will be a year of build-out; OEM orders start to flow properly in H2. The Group should turn sharply profitable in 2022e, with a further ramp-up in 2023e. With Cell Two up-and-running, factory revenue capacity will rise to £35m from £20m currently. We assume a sustainable net margin of 25%-30%, or implied profit up to £10.5m and a PE of c.14x. A fully fitted-out five-cell factory could generate up to £22.5m of net profit each year. Surface Transforms must deliver but is now well positioned for the medium-term.

Companies: Surface Transforms plc

24 Feb 21

BOTB - Conclusion of Strategic Options Review & profit upgrade

The group has announced the Board’s decision to terminate the Strategic Options Review announced in June 2020 and to continue to focus on its existing online strategy, which continues to generate exceptional growth and strong cash flow. The statement also provides a trading update that confirms continuing strong trading through Q3. Our current year forecast PBT is upgraded by 79% from £7.8m to £14.0m.

Companies: Best of the Best plc

23 Feb 21

Arcontech - Solid H1 results with +5% revenue growth

Arcontech has reported a solid set of H1 21 results that provide a strong foundation for future growth. H1 revenue has increased +5% to £1.54m as 90% of Arcontech’s revenue is from recurring licence fees, and the October 2020 new tier one client win and tier one client contract upgrade provide £100k of additional annual recurring revenue, which offsets an existing client developing certain functionality in-house. The strength and flexibility of Arcontech’s solutions have enabled it to achieve these client wins despite a challenging H2 20 and H1 21 environment, where it has been difficult to finalise new sales due to limited customer contact and decisions being delayed due to remote working. In this environment, the two new additions to Arcontech’s salesforce since January 2020 have had a limited impacted on revenue, and the YoY opex impact leads to H1 adjusted EBIT declining 7% to £0.52m. However, Arcontech’s strengthened salesforce has been diligently establishing relationships with new potential customers, and as conditions return towards normal, we expect Arcontech will deliver new client wins that will benefit revised forecasts with a high incremental margin. Arcontech’s strong net cash of £5.0m continues to provide it with the flexibility to invest in accelerating its future growth through product development and sales, and we continue to expect it will grow its dividend by 10% at FY21 results. Although we reduce our forecasts to reflect the challenging sales environment, we look forward to Arcontech announcing new contract wins as it builds upon its strong foundations. On 23x 12m forward P/E with +5% NTM EPS growth and an EFCF yield of 4%, Arcontech trades at a discount to peers in financial information and the finnCap Next 50 on P/Es of 27-47x with NTM EPS growth of +6-15%, and EFCF yields of 2-4%.

Companies: Arcontech Group PLC

24 Feb 21

Faster cost of risk normalisation

The lockdowns continued to weigh on the top-line performance, but the state’s supporting measures have proven so successful that the quarter enjoyed provision recoveries and the cost of risk is expected to almost fully normalise as soon as this year. However, 2021 will remain a transitory year as the top-line is expected to recover only progressively.

Companies: Lloyds Banking Group plc

24 Feb 21

SP Angel Healthcare Conditions

Novacyt S.A. (NCYT.L*): R&D Update | N4 Pharma (N4P.L): Full year results

Companies: Novacyt SAS (ALNOV:PAR)N4 Pharma Plc (N4P:LON)

25 Feb 21

CMD shows continued positive progress

Yesterday’s CMD from RBGP saw presentations from the Group CEO and each of the three division heads, outlining the Group’s strategy and updating on progress. Since our investment revisit note (here), which laid out what we expected for FY21E, we have upgraded forecasts for both FY21E and FY22E (here), and have seen continued progress against the investment case. We summarise the key points for each division below. RBGP’s shares are up c.55% YTD to 91p; a 12.1x FY21E PER (11.2x EV/EBITDA) with a 4.8% FY21E dividend yield. Putting the shares on a rating in line with the peer group would suggest an intrinsic value of 120p.

Companies: RBG Holdings Plc

25 Feb 21

dotDigital - Strong interims give room for investment

In a repeat of the pattern of 1H20, dotdigital’s strong 1H21 to December substantially derisks the achievement of unchanged FY profit expectations, and allows room for increased investment after we tickle FY21 revenue forecasts up 2%. As we noted in our “Treble 20” note at the time of the January trading update, all key revenue stats grew by at least 20% compared with the pre-COVID 1H to December 2019, suggesting very strong momentum in each of the pillars of growth (territory, product and partners) – the aim to generate more revenue, from more customers using more communication channels, in more territories, and through more partners. 22% organic group revenue growth derived from average revenue per customer growth of 20%; additional functionality revenue growth of 20%; international revenue growth of 27%, and allows additional investment in growth in 2H21 and beyond. EMEA (incl. UK), generated significant growth of 21% (1H20: 11%) from increased SMS messaging as a further channel, reducing group gross margin to a still strong 82% (1H20: 94%). EBITDA of £10.5m from revenue of £28.2m led to free cash generation of £3.2m (1H21: £3.1m), with DOTD cashflow seasonally stronger in 2H. The net cash balance of £27.6m (FY21E: £30.3m) leaves all strategic opportunities open to the group. Target 200p (185p).

Companies: dotDigital Group plc

22 Feb 21

Tristel - Strong interims and US regulatory progress

Tristel reported interim results that were c.2% above the trading update at its AGM on 17 December with adjusted pre-tax profit of £3.4m (+12%) driven by a 15% increase in revenues. Despite the strong first half there is a cautionary tone to the second half, given the lacklustre start to H2 FY 2021 as a result of lockdown in many of its markets impacting out-patient procedures. That said, our forecasts assume 5% revenue growth in H2 with adjusted PBT 5% below H2 FY 2020. With the prospect of vaccination rollout opening markets, there is a clear route to achieving and exceeding our forecasts, but for the time being we leave forecasts unchanged. However, confirmation that it has completed a Usability and Form Factor study in the US is a significant milestone, underpinning our confidence for US market access and the reason for increasing our target price to 550p, which implies a prospective 3.0% free cashflow yield.

Companies: Tristel Plc

24 Feb 21

Decisive actions to transform the company

Aviva continues to execute rapidly its strategy, leaving France and Turkey. In the last few months, the insurer has realised six transactions. The cash will be used to improve business in the targeted markets (the UK, Ireland, Canada), reduce debt (£1.5bn in 2022) and to distribute a dividend to shareholders (14p per share to be proposed at the upcoming General Meeting).

Companies: Aviva plc

22 Feb 21

Fonix Mobile - Strong H1 results with +28% EBITDA growth

Following Fonix’s IPO in October 2020, H1 results demonstrate strong growth that is comfortably in line with unchanged expectations. Successful strategic execution to expand with existing clients has led to H1 TPV growth of +18%, and no churn, while adding 21 new clients from a robust pipeline of opportunities. H1 revenue has grown +25%, while gross profit has increased +22% to £5.8m, with gross margin as a % of TPV marginally increasing to 4.7% from 4.6%. The strong operating leverage of Fonix’s proprietary cloud-based platform has driven H1 EBITDA growth of +28%, as Fonix has diligently controlled its opex while continuing to evolve its platform to meet and exceed client needs. H1 adjusted net income increased +28%, while adjusted EPS increased +24% to 3.6p due to the increase in diluted shares. In line with the target 75% payout ratio, the maiden interim dividend of 1.7p is on track for 5.1p for the year. Forecast underlying FCF will amply cover the dividend, and H1 21 underlying adjusted FCF of £3.6m increased underlying net cash to £3.6m. As trends become clear during Fonix’s first year post IPO, we conservatively leave our FY21-22 forecasts unchanged and look forward to further updates in the coming months. We reiterate our target price of 200p based on a 4% FY22 FCF yield or 20x FY22 EV/EBITDA.

Companies: Fonix Mobile PLC

22 Feb 21

SP Angel Morning View:

Bluebird Merchant Ventures (BMV LN) – Funding proposed through digital token linked to gold Empire Metals* (EEE LN) – Empire complete acquisition of Eclipse gold project Condor Gold* (CNR LN) – Drilling underway on the Cacao Vein Cornish Metals* (CUSN LN) – Osisko converts its note to a royalty Orosur Mining* (OMI LN) – High-grade gold intersections received at Anza Phoenix Copper* (PXC LN) – £2m debt facility to accelerate the Empire project Rambler Metals and Mining* (RMM LN) – New non-executive appointment to strengthen the board Tertiary Minerals* (TYM LN) – Lucky Copper Project drilling

Companies: CUSN OMI BMV CNR EEE PXC RMM TYM IRR

23 Feb 21

WHI Morning Comment: i3 Energy (I3E) - Operational Update

i3 Energy has provided an interim update the highlights of which are: • Production is exceeding expectations with lower declines than modelled resulting in stable production from November 2020 to January 2021 averaging 9,150 boe/d (41% liquids) – about 1,000 boe/d greater than expected by the forecasts of the company's competent persons' reports at the time of its relisting. • Based on the futures curves for oil & gas, the company anticipates net operating income for 2021 (revenue minus royalties, operating costs, transportation and processing) of approximately CAD $35m (US $27.6m). • Maintenance capital expenditure guidance in conjunction with the net operating income amounts to CAD$3m. • i3 Energy completed an 80 hour flow-test on a horizontal Falher well located on its Noel acreage in Northeast British Columbia. The flow test ran for a sustained period at 4,200 mcf/d (700 boe/d) on a 1/4” choke. The well is expected to be brought on production at approximately 500 boepd during the second quarter of 2021, following tie-in. This well was not included in the company's 2P reserve estimates. The result represents a materially value enhancing development. Both the net income guidance and maintenance capital guidance excludes the potential contribution of the Noel acreage. • The Company continues to progress the legal process to allow it to declare a dividend in Q1 2021. As previously disclosed, the Company aims to distribute up to 30% of free cash flow as a dividend to shareholders. • The company indicated that discussions continue with a potential farm-in partner for the Serenity discovery and terms are being negotiated. The recent strengthening in commodity prices has reinvigorated activity within i3's virtual data room, and additional parties previously contacted during early 2020 have now re-engaged with the company. The company indicated that the market will be updated if and when an agreement is reached. (see Table 1 for asset scale/value estimates in relation to the company's North Sea assets).

Companies: i3 Energy Plc

25 Feb 21

Accelerating Growth

We have often made the point that DOTD should see accelerating growth on the back of new functionality and international expansion. H1 organic revenue growth of 22% (compared to a steady c.15% pre-CV19) is a strong validation of our thesis and is indicative of secular trends rather than a pandemic bounce back. We note strong growth in SMS (notably driving c. 25% revs growth in the UK), strong international and partner growth (27% and 20% resp.), enhanced functionality growth (20%) and, bringing it all together, ARPC growth (20%). Many of these growth areas are in their infancy and offer a significant growth runway ahead.

Companies: dotDigital Group plc

25 Feb 21

WHI First Light: AFC Energy (AFC) - Launch of Anion Exchange Membrane Fuel Cell Test Facility

AFC Energy has this morning announced (RNS Reach) that it has launched its Anion Exchange Membrane (“AEM”) Fuel Cell test facility at the Company's Surrey headquarters. This facility will test and optimise AFC Energy's high energy-density fuel cell technology, HydroX-Cell(S)™, that is currently in development. The design of the new dedicated AEM fuel cell facility was completed in the second half of 2020 with full fit out now complete in advance of full operation.

Companies: AFC Energy plc

25 Feb 21

Maintained momentum….. …..delivers further upgrade

Further to the upgrade delivered on the back of its impressive Q3 peak trading period, G4M has continued to perform strongly in Q4, resulting in another upgrade. Management now anticipates that EBITDA for FY21E will be not less than £18.2m, compared with our previous forecast of £16.6m. We have subsequently raised our FY21E EBITDA forecast by £1.7m (+10%) to £18.3m. G4M will make a more detailed announcement on FY21E’s trading performance no later than 23 April.

Companies: Gear4music (Holdings) PLC

26 Feb 21

Anglo Pacific Group makes a transformational move by acquiring stream on the Voisey’s Bay Project

26 Feb 21

Positive 2021 guidance

In Q4 20, the decrease in organic revenue slowed (-1.2%) thanks to some recovery of the delays in Air Traffic Management and a good development in Transport with various projects in Spain and America. The 2020 results included significant restructuring costs which should have a positive effect in 2021. Guidance is positive with the goal of going back to pre-COVID-19 levels in 2021.

Companies: Indra Sistemas (IDR:BME)Indra Sistemas, S.A. Class A (IDR:MCE)

26 Feb 21

The Law Debenture Corporation - Strong IPS performance underpins FY20 returns

The Law Debenture Corporation (LWDB) made the most of its structure in 2020, with the revenue contribution from its independent professional services (IPS) business – which saw another year of strong growth – helping to overcome a shortfall in portfolio income after widespread UK dividend cuts, and driving an unanticipated 5.8% increase in the total FY20 payout. NAV total returns for the year ended 31 December were modestly positive, compared with double-digit declines for many UK Equity Income peers. The diversity of the underlying IPS businesses means CEO Denis Jackson is sanguine about prospects even in uncertain market conditions, while fund managers James Henderson and Laura Foll will continue to capitalise on the investment freedom the IPS income contribution provides.

Companies: Law Debenture Corporation

26 Feb 21

An awful 2020 financial year

There was no surprise in the poor Q4 20 numbers. FY2020 was an awful year for the group with a collapse in revenue (-61%) and EBITDA (€228m vs €2,232m in 2019). The start to 2021 gives no sign of a strong market recovery. There is a consensus that the airline industry will be back to the pre-COVID-19 level in 2024. Any acceleration in this journey would be positive.

Companies: Amadeus It Group (AMS:BME)Amadeus IT Group SA Class A (AMS:MCE)

26 Feb 21

Well done despite aeronautics and the cyberattack

Q4 20 organic revenue (-7.7% vs -5.9% in Q3 20) was impacted by the cyberattack and the continuing negative trend in aeronautics. Nevertheless, the group limited the breakage in 2020 with a 4.8% decrease in organic revenue (o/w -1pt attributable to the cyberattack) and an operating margin on business activity of 7% of revenue (-1pt) better than expected, including a negative 0.2pt related to the cyberattack. 2021 guidance is positive.

Companies: Sopra Steria Group (SOP:EPA)Sopra Steria Group SA (SOP:PAR)

26 Feb 21

Closer to the 2024 target

Arkema’s increasing footprint in speciality chemicals helped to protect profitability. Furthermore, management has taken the next steps towards the mid-term target, even in a crisis. By divesting PMMA, its has taken advantage of a special situation, allowing for a decent valuation. Unfortunately, the company still fully consolidates the to-be-divested business showing up our estimates. Consensus was clearly beaten as it still included the PMMA business.

Companies: Arkema (AKE:EPA)Arkema SA (AKE:PAR)

26 Feb 21

Benchmark Holdings 'end first quarter on positive note, good progress and strong financial position'

26 Feb 21

Strong end to FY2020 on the back of continued recovery in H2

Elecnor reported a flat FY2020 top line, on the back of the recovery in core operations such as energy generation and transmission, and telecom infrastructure during the second half of the year. The group’s order-book (€2.27bn) improved marginally from last year with c.73% of contracts related to international markets. Looking ahead, management expects a better performance in FY 2021 supported by a strong order pipeline, the strategic nature of operations, and geographic diversification.

Companies: Elecnor (ENO:BME)Elecnor S.A. (ENO:MCE)

26 Feb 21

Vaalco Energy (LSE: EGY): Completing Gabonese acquisition

• Vaalco has now completed the acquisition of Sasol’s 27.8% working interest in the Etame Marin block offshore Gabon, increasing the Vaalco’s total working interest to 58.8%. • The company paid US$29.6 million in cash to Sasol, taking into account the agreed upon transaction price of US$44 mm, the deposit already paid and post-effective date adjustments, with a future contingent payment of up to US$5 mm. • The final payment is marginally lower than we anticipated (US$35 mm as of mid-January) and reflects the higher oil price so far in 1Q21. • The shares continue to offer a combination of value, low risk upside and very material newsflow associated with the farm out of assets in EG that would add a new dimension to the story. Looking at the upside The overall upside at Etame Marin comprises 12.6 mmbbl WI contingent resources mostly associated with licence extension beyond 2028 and future drilling plus 30 mmbl WI prospective resources mostly associated with unswept areas. Contingent plus prospective resources represent 2x the current 2P reserves and carry a very high probability of success (55 75%). Low risk infill drilling of contingent resources could add ~£0.48 per share (~25% of share price) with an overall unrisked value for the upside at the producing asset of £4.80 per share (~2.4x the current share price). The crude sweetening project could add ~£0.90 per share. Finalizing the EG farm out transaction could start unlocking a further £4.20 of unrisked value. Still a value name even after the share price increase Our 2P NAV for Vaalco is £2.84 per share, representing 40% upside to the current share price. Our ReNAV of £4.10 per share only includes (1) Etame Marin’s contingent resources, (2) one Gamba appraisal well and (3) the risked value of the EG assets. Our ReNAV represents >100% upside to the current share price.

Companies: VAALCO Energy, Inc.

26 Feb 21

Strong Portugal, extra provisioning effort abroad

The quarterly performance was supported by strong Portuguese operations which enabled the group to absorb the extra provisioning efforts in Mozambique and Poland.

Companies: Banco Comercial Portugues (BCP:ELI)Banco Comercial Portugues S.A. (BCP:LIS)

26 Feb 21

FY 20: confidently walking into 2021

LafargeHolcim reported FY20 results in line with our expectations. It saw demand recovery in all its markets and the trend is continuing in 2021 as well. Its COVID-19 action plan delivered CHF385m in fixed cost savings and will deliver further savings in 2021, which should offset the inflation in raw material prices. It generated a record-high FCF of CHF3.2bn resulting in a net debt leverage of only 1.4x. LafargeHolcim proposed a dividend payment of CHF2/share.

Companies: LafargeHolcim Ltd.

26 Feb 21

A muted end to FY20

Like other capital goods companies under our coverage, IMI too witnessed a stronger second half. The full-year results were, however, slightly below our expectations. The group’s restructuring efforts bore some fruit but also experienced a delay due to the pandemic. The proposed dividend matched our expectations but the FY21 outlook is rather soft from our point of view.

Companies: IMI plc

26 Feb 21

Anglo Pacific Group announce 'largest ever acquisition' to seize upon electric vehicles boom

26 Feb 21

EGY LN, PEN NO, PTAL LN, 88E LN, CORO LN, ECHO LN, ENI IM, ENQ LN, GTE LN/CN, I3E LN, JSE LN, KOS LN/US, LEK LN, MAHA-A SS, ORC.A/B CN, PPC LN, TLW LN, XOM US

AUCTUS PUBLICATIONS Vaalco Energy (EGY US/LN)C; Target price of £4.20: Completing the acquisition of stake in Etame – Vaalco has now completed the acquisition of Sasol 27.8% working interest in the Etame Marin block offshore Gabon, increasing the Vaalco’s total working interest to 58.8%. The company paid US$29.6 million in cash to Sasol, taking into account the agreed upon transaction price of US$44 mm, the deposit already paid and post-effective date adjustments, with a future contingent payment of up to US$5 mm. The final payment is marginally lower than we anticipated and probably reflects the high oil price in January so far in 1Q21. Panoro Energy (PEN NO)C; Target price of NOK30 per share: Confirming guidance and high impact newsflow – The 4Q financial headlines did not include any surprises with Tunisia production increasing to 4,500 bbl/d (gross). FY21 production guidance has been set at >9 mboe/d (we assume 9.5 mboe/d) with US$42 mm capex (including US$6 mm for Tunisia, US$5 mm for South Africa exploration, US$10 mm for EG and the balance for Gabon) plus US$5 mm for the Salloum well in Tunisia. The high impact Hibiscus exploration well in Gabon is expected to be spudded in April 2021 with results in May. Our unrisked NAV for this well is >NOK12 per share (>50% of current share price). There are only 1-2 liftings per year in EG, each one is very large (0.95 mmbbl per lifting). One of these liftings is taking place in 1Q21 with production from July 2020 allocated to Panoro but sold at the currently high price. The next one will be in 4Q21 or 1Q22. PetroTal (PTAL LN)C; Target price up from £0.50 to £0.60 per share on increased reserves - YE20 1P, 2P and 3P reserves were respectively 22.3 mmbbl (+4% vs YE19), 51.0 mmbbl (+7%) and 106.1 mmbbl (+25%). The YE20 estimates are net of 2.1 mmbbl production in 2020, implying a 5.4 mmbbl upwards revision for the 2P reserves compared to previous estimates. The 1P and 2P reserves increase reflect a reserves replacement ratio of respectively 38% and 157%. As we anticipated, the reserves increase is the result of higher recovery factor assumptions, reflecting the performance of the wells to date. The new 2P and 3P cases assume recovery factors of respectively 15% (+1.4%) and 17% (+2.4%). Our new 2P NAV is £0.37 per share (£0.34 per share previously), which represents >2x the current share price. Our new ReNAV incorporating the increase in reserves is £0.59 per share (£0.52 per share previously). We have set our new target price at this level. We are increasing our target price from £0.50 to £0.60 per share. IN OTHER NEWS ________________________________________ AMERICAS 88 Energy (88E LN/U): Prospective resources update in Alaska – The total prospective resources associated with project Peregrine are estimated at 1.6 bn boe. Echo Energy (ECHO LN): Operational update in Argentina – FY20 net production from Santa Cruz Sur was 1,966 boe/d. The company will now upgrade and debottleneck the existing liquids pipelines to bring the remaining volumes previously shut in in 2Q20 back online and restore net liquid production of 336 - 420 bbl/d. Exxon Mobil (XOM US): Selling North sea assets – Exxon Mobil is selling most of its non-operated upstream assets in the U.K. central and northern North Sea to NEO Energy for >US$ 1bn. There may be additional contingent considerations of ~ US$300 mm. The acquisition adds ~ 40,000 boe/d production and > 140 mm boe of reserves. The portfolio to be acquired consists of 21 assets, including 14 fields. This includes 50% WI in the Gannett cluster, 4.38% in Elgin-Franklin and 44%-72% in the Shearwater area. Galp: 4Q20 results – 4Q20 production was 122.8 mboe/d including 109.8 mboe/d in Brazil and 13.1 mbbl/d in Angola. The company held 2P reserves of 700 mmboe at YE20 (-6% versus YE19) while YE20 2C resources were 1.7 bn boe. FY21 production guidance has been set at 125-135 mboe/d. Gran Tierra Energy (GTE CN/LN): FY20 results and outlook – FY20 production in Colombia was 22,264 bbl/d. FY21 production guidance has been set at 28-30 mbbl/d with US$130-150 mm capex. Gran Tierra collected total VAT and income tax receivables of US$114 mm during 2020. At YE20, Gran Tierra held US$34.4 mm in cash and working capital surplus, a US$190 mm revolving credit facility and US$600 mm of senior notes. i3 Energy (I3E LN): Operational update in Canada – November 2020 to January 2021 averaged 9,150 boe/d (41% liquids). The horizontal Falher formation well located on the Noel acreage in Northeast British Columbia was tested at 4,200 mcf/d on a 1/4” choke. The well is expected to be brought on production at ~500 boe/d during the 2Q21. Currently there are no booked reserves attributed to this well, or to any potential offsetting development locations. Maha Energy (MAHA-A SS): 4Q20 results – 4Q20 production in Brazil was 2,738 boe/d. Maha held US$6.7 mm in cash at YE20. President Energy (PPC CN): Trading update and outlook in Argentina – President’s FY20 net production was >2,700 boe/d with ~3,300 boe/d production in December. YE20 net debt was US$16 mm. FY21 production guidance has been set at 3,600-4,000 boe/d, with capex of ~ US$18 mm. ASIA PACIFIC Coro Energy (CORO LN): Acquisition of renewable Energy business in Asia and equity raise – Coro Energy is acquiring Global Energy Partnership Limited (GEPL) for £0.6 mm. GEPL is an originator and developer of renewable energy projects in South East Asia. Coro has also raised £4.5 mm mm of new equity priced at 0.4p per share. Additional proceeds of up to £0.5 mm are to be raised pursuant to the Open Offer. Jadestone Energy (JSE LN): FY21 outlook – FY21 production in Australia and New Zealand is expected to be 11.5-13.5 mbbl/d with US$85-95 mm capex. PTT EP/Petronas: Gas discovery offshore Malaysia – The Dokong-1 wildcat exploration well in Block SK417 offshore Sarawak encountered a gas column measuring > 80 metres in the Middle to Late Miocene Cycle VI-VII reservoirs. EUROPE ENI (ENI IM): Strategy update – Production is expected to grow at an average of around 4% per year over the next four years. Upstream capex will amount to around €4.5 bn per year on average. ~55% of the 1P reserves will be gas in 2024, vs. 50% today. Unlevered IRR for renewable projects is in the range of 6-9% while the IRR of upstream projects in execution is 18%. EnQuest (ENQ LN): Farming down UK asset – EnQuest is selling 85% WI in the Eagle discovery to Anasuria Hibiscus in return for a full carry of all costs from completion of the transaction through to first oil. Wintershall: 4Q20 results – 4Q20 production was 654 mboe/d (FY20 production of 623 mboe/d above FY20 guidance of 610-615 boe/d). YE20 net debt was EUR5.5 bn. At YE20, Wintershall held 2P reserves of 3.6 bn boe and 2C resources of 2.1 bn boe. FY21 production guidance has been set at 620-640 mboe/d with capex of EUR1.0-1.1 bn, including EUR200-250 mm for exploration. FORMER SOVIET UNION Enwell Energy (ENW LN): Appraisal well results in Ukraine – The SV-25 appraisal produced at a stabilised flow rate of approximately 1.9 mmcf/d of gas and 109 bbl/d of condensate from the B-22 formation only. SUB-SAHARAN AFRICA Kosmos Energy (KOS LN/US): 4Q20 results – 4Q20 production was 60.2 mboe/d, including 24.3 mbbl/d in Ghana, 25.5 mbbl/d in the US GoM and 10.5 mbbl/d in EG. Kosmos exited 2020 with net debt of ~US$2 bn and available liquidity of ~US$570 mm. First gas at the Greater Tortue Ahmeyim project in Mauritania and Senegal continues to be expected in 1H23. The sale of the FPSO in 2Q21 is expected to reduce Kosmos' cash requirements to first gas by ~ US$320 mm. FY21 production guidance has been set at 53-57 mboe/d. Kosmos expects to spend ~US$225 to $275 mm in 2021, excluding Mauritania and Senegal. In Mauritania and Senegal, FY21 capex capital expenditure for Kosmos' WI is expected to ~US$350 mm. At YE20, Kosmos held 2P reserves of 480 mmbbl. Lekoil (LEK LN): Indicative offer from Lukoil – Lekoil has received a letter from Optimum, the Operator of the OPL 310 Licence, to terminate the Cost and Revenue Sharing Agreement for OPL 310. Lekoil believes that this letter is not valid. Orca Energy (ORC.A/B CN): Increasing dividends – Orca is increasing its quarterly dividends from C$0.08 to C$0.10 per share. Tullow Oil (TLW LN): RBL redetermination - Tullow and its technical banks have agreed a new debt capacity amount under the RBL facility of ~US$1.7 bn (down from US$1.8 bn at the end of September); this remains subject to formal approval by a majority of lending banks. Based on the new debt capacity amount, Tullow will have liquidity headroom of free cash and available debt facilities of ~US$0.9 bn. EVENTS TO WATCH NEXT WEEK ________________________________________ 01/03/2021: Seplat Petroleum (SEPL LN) – 4Q20 results 04/03/2021: Aker BP (AKERBP NO) – 4Q20 results 04/03/2021: Frontera Energy (FEC CN) – 4Q20 results

Companies: XOM XOM TLW 88E ENI ENI ENQ GTE I3E JSE KOS MAHAA PEN PEN TAL EGY

26 Feb 21

FY20 results: hit rock bottom...to bounce back better?

Lagardère reported very poor FY20 results as expected. The Travel Retail division, which fell more sharply than anticipated, continues to weigh on results. By contrast, the Publishing division limited the damage with a better-than-expected performance. The group loss reached €660m (FY19: €-15m). Although Arnaud Lagardère indicated that no decision has been taken regarding potential disposals, he was rather open to a modification of the “commandite” structure.

Companies: Lagardere SCA (MMB:EPA)Lagardere SCA (MMB:PAR)