Kosmos Energy Tops Q3 Earnings & Revises FY23 Outlook, Boosts Interest In Senegal Asset

Kosmos Energy Ltd KOS reported third-quarter (Q3) 2023 revenue of $526.5 million, beating the consensus of $457.4 million.

Net production came in at around 68,200 barrels of oil equivalent per day (boepd), with sales of about 73,100 boepd in the quarter.

Production grew 17% Q/Q following the successful startup of the Jubilee South East development, with three producers brought online taking gross field production up to around 100,000 barrels of oil per day.

Also Read: Kosmos Energy CEO Touts Success At Tiberius Well, 'Top Quartile Carbon Emissions'

KOS exited the quarter in a net underlift position of about 0.5 million barrels, which is expected to partially reverse in Q4 FY23.

Realized pricing declined to $78.24 per boe (including derivative cash settlements) from $97.34 per boe.

Pro Forma EBITDAX increased to $369.1 million from $301.5 million a year ago.

Adjusted EPS of 26 cents, surpassing the consensus of $0.21.

Net capital expenditure stood at $193 million in the quarter, in line with the guidance.

Operating cash flow stood at around $249.4 million in the quarter.

As of Sept. 30, cash and cash equivalents stood at $138.7 million, and total long-term debt of around $2.4 billion. 

"Looking to options for future growth, Kosmos recently announced the Tiberius oil discovery in the U.S. Gulf of Mexico, as well as the assumption of operatorship of the Yakaar-Teranga gas fields offshore Senegal," CEO Andrew G. Inglis said. "These low cost, lower carbon oil and gas projects are expected to provide the next phase of growth for the company beyond 2024. We plan to balance the pace and working interest of these future projects to ensure we can manage our growth and generate material free cash flow."

Notably, Kosmos Energy boosted its working interest to 90% And assumed operatorship of Yakaar-Teranga Gas Discoveries Offshore Senegal, subject to customary government approvals.

Outlook: KOS expects the production of 66,000 - 69,000 boe per day and capital expenditure of $225 million - $250 million in Q4.

For FY23, the company now expects capital expenditure of ~$800 million (vs. $700 million - $750 million earlier) and production of ~63,000 boe per day (vs. 65,000 - 69,000 boe per day prior). 

Also Read: Several North American Oil & Gas Exploration And Production Companies Downgraded Amid Current Environment: Here's Why

Price Action: KOS shares are trading higher by 1.19% at $7.65 premarket on the last check Monday.