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(Alliance News) - Sound Energy PLC on Friday posted a significantly narrowed loss for the first half of 2020 as the Covid-19 pandemic failed to have a "material impact" on the company's operations.
Shares in the Morocco-focused upstream gas company were trading 5.3% lower at 1.57 pence each on Friday morning in London.
For the six months ended June 30, Sound Energy posted a pretax loss of GBP380,000, narrowed from a GBP11.5 million loss the year prior.
Administrative expenses were GBP1.7 million, down 57% year-on-year from GBP4.0 million, as exploration costs dropped to zero from GBP6.5 million.
"The first half of 2020 was an active and productive period for the company as it reset its strategy to transition towards becoming a cash generating company with significant exploration potential," Chief Executive Graham Lyon said.
During the six months, Sound Energy signed a heads of terms with a "leading Moroccan energy group" to construct a liquefied natural gas project. Environmental impact assessment approvals for a 120-kilometre, 20-inch pipeline and gas treatment plant were received in January and March, respectively.
Looking ahead, the company said while the pandemic has not materially hurt its business, a deterioration of the pandemic may delay progress in completing activities necessary to restructure or refinance its EUR28.8 million bond. It added that cashflow forecasts for the 12-month period to September 2021 shows that additional funding will be required to allow it to meet its obligations.
As at the end of June, Sound Energy had cash of GBP4.2 million. In August, it raised GBP3.2 million through the placing of 163.5 million shares at 2.125p each.
By Ife Taiwo; ifetaiwo@alliancenews.com
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