Prospex Energy (PXEN)
Prospex Energy (PXEN) has announced the final repayment of the convertible loan notes issued in September 2022, making the company debt free. The CLNs enabled the company to fund its contribution for construction of the now producing Selva asset in Italy. This instalment was repaid in cash rather than converted to shares with the final payment totalling £175k.
This is an impressive achievement to have deleveraged in such a short period of time and reflects the strong performance at the company’s two producing assets in Italy and Spain.
The latest news from Selva indicated increasing production to 78,000-80,000scmd with production in Q4 2023 between 60,000-70,000scmd yielding gross revenues of €1.8m (€0.9m net to PXEN). Gas prices in Europe have softened during 2024 but have bounced back 35% to €31/MWh from their February lows.
PXEN along with its partners intends to reinvest the growing cash balances in the respective partner companies into further exploration with three wells planned in Italy and five in Spain where permits have been lodged with an outcome pending.
We reiterate our Buy recommendation and target price of 20.1/sh..
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Oliver O'Donnell, CFA, Head of Research & Natural Resources Analyst
VSA Capital Limited is Authorised and Regulated by the Financial Conduct Authority and is a member of the London Stock Exchange and the Aquis Stock Exchange.
The Company is registered in England with company number 2405923 at Park House, 16-18 Finsbury Circus, London EC2M 7EB.