SEPLAT PLC Company Update - Additional shares listing berths with some dilution

Additional shares listing berths with some dilution                                                                       

SEPLAT earlier today announced the listing of an additional 25,000,000 ordinary shares (c.4.4% of existing shares) on the Nigerian Stock Exchange, effectively taking the company’s share capital to 588,444,561 ordinary shares of ₦0.50k each. The shares all have voting rights and are particularly allotted to the Management and Directors of SEPLAT in furtherance of the Company's Long-Term Incentive Plan. The corporate action is fully within the jurisdiction of the powers granted to the Board of Directors by the company’s shareholders at the Annual General Meeting held on 30th June 2014 - to implement the Initial Public Offer (IPO) award and other remuneration of the top Management and Directors as disclosed in the IPO Prospectus.                                                                      

However, due to the increased number of shares arising from the additional listing, our per share forecasts have been revised. Following the update, our FY’18 EPS now stands at $0.24 (Previous: $0.25, FY’17E: $0.06). Our NAV/Target Price (considering 2P assets only) has also been revised to $1.60 (Previous: $1.67). At current NAFEX rate of NGN360.57/USD, our NAV translates to ₦727.33 (Previous: ₦749.16). We maintain a HOLD rating on SEPLAT.                                                                      

SEPLAT is an independent Oil and Gas Exploration and Production (E&P) company formed in 2009 by Shebah Petroleum and Platform Exploration & Production, following which, French exploration company Maurel & Prom (MPI) purchased a 45% stake. In July 2010, SEPLAT acquired OMLs 4, 38 and 41 from Royal Dutch Shell’s Nigeria Division (SPDC), attaining a 45% stake and operator status.