Ithaca reiterates guidance after strong first quarter

(Sharecast News) - Ithaca Energy said on Wednesday that first-quarter production remained strong despite adverse weather, as it reiterated full-year guidance and said its 2026 dividend was expected to be above $500m.

The FTSE 250 North Sea oil and gas producer said average production was 126,000 barrels of oil equivalent per day in the three months to 31 March, broadly flat against 127,000 boepd a year earlier.

Production was affected by adverse weather in January and the first half of February, but Ithaca said the impact had already been reflected in guidance issued in March and that strong operational performance had continued into the second quarter.

Adjusted EBITDAX fell to $570.9m from $653.2m a year earlier, mainly reflecting movements in oil and gas inventories and commodity hedging losses, partly offset by higher revenue from increased liftings.

Profit before tax declined to $262.7m from $367.2m, while profit for the period was $67.4m, compared with a loss of $258.7m in the first quarter of 2025.

Net cash flow from operating activities was $423.1m, compared with $435.3m a year earlier.

Unit operating expenditure rose to $18.3 per barrel of oil equivalent from $16.5, while adjusted net debt fell to $1.12bn from $1.26bn at the end of December.

Available liquidity increased to $1.60bn from $1.47bn, and the adjusted net debt to pro forma adjusted EBITDAX ratio improved to 0.54 times.

Ithaca reaffirmed 2026 production guidance of 120,000 to 130,000 boepd, operating cost guidance of $820m to $860m, producing asset capital expenditure guidance of $600m to $700m, Rosebank capital expenditure guidance of $280m to $320m, decommissioning cost guidance of $170m to $210m and cash tax guidance of $290m to $340m.

The company said its dividend commitment of 30% of post-tax cash flow from operations remained unchanged, with the expected full-year dividend now trending towards the upper end of the $470m to $520m guidance range and likely to exceed $500m.

It paid a third interim 2025 dividend of $200m in April, taking total 2025 dividends to $500m.

Operationally, Ithaca said it had made progress across several projects.

It entered a long-term rig-sharing agreement with Harbour Energy through to 2030, completed a 50% farm-in to licences containing the Tobermory discovery west of Shetland, and agreed to farm down a 45% interest in the Fotla development to Harbour.

At Rosebank, the FPSO sailed away from Dubai during the quarter after major refurbishment work, while drilling began at the end of the period. Ithaca said an equipment handling incident had taken the rig off hire in April, with the rig operator estimating three to four months of remediation before it returns.

The company also said Cambo was continuing to mature towards a potential final investment decision in 2026 or 2027, while the Tornado project had reached the final stages of FEED and tendering after submission of the field development plan and environmental statement.

Executive chairman Yaniv Friedman said Ithaca's first-quarter performance reflected "the strength of our strategy, our continued disciplined execution and ongoing commitment to operational excellence".

"As a result of escalated commodity prices, we now anticipate that our 2026 dividend will likely move to the upper end of our guidance range at over $500 million, with shareholders participating in the upside exposure to strengthened cash flow generation through our distribution policy in 2026 of 30% post-tax CFFO," he said.

At 0902 BST, shares in Ithaca Energy were up 0.63% at 287.4p.

Reporting by Josh White for Sharecast.com.

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