First Half 2019 Financial and Operating Results 02 August 2019 - - PowerPoint PPT Presentation

First Half 2019 Financial and Operating Results 02 August 2019

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First Half 2019 Highlights

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• Completed definitive feasibility study for the first phase of the Silangan

Project:

• Mineral resource estimates up 43% to 571 million tonnes compared to

398 million tonnes as previously declared in 2011 for the Boyongan, Bayugo and Kalayaan ore deposits

• First phase expected to yield 81 million tonnes of mineable reserves out
• f 279 million tonnes of mineral resource estimates for the Boyongan

deposit, carrying high-quality ore grades of 0.63% for copper and 1.20 grams per tonne for gold

• Appointed reputable and top-notch professional advisers for equity raising,

project financing and legal advisory

• Launch search process for possible strategic partners
• Reported net income of P391 million for the first semester of 2019
• Core net income of P93 million for the second quarter of 2019

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Q1 2019 Q2 2019 +/- 1H 2019 1H 2018 +/- Tonnes Milled (‘000) 1,832 1,973 8% 3,805 4,388

• 13%

Production: Gold – ozs 10,493 13,182 26% 23,675 34,583

• 32%

Copper – lbs (‘000) 5,727 6,280 10% 12,007 14,149

• 15%

Recovery: Gold 74% 78% 4% 77% 76% 1% Copper 81% 82% 1% 82% 79% 3% Ore Grade: Gold – gms/dmt 0.239 0.266 11% 0.253 0.321

• 21%

Copper - % 0.175 0.176

• 0.175

0.186

• 6%

Average Realized Prices: Gold – (US$/oz) 1,304 1,329 19% 1,316 1,314

• Copper – (US$/lb)

2.96 2.66

• 10%

2.75 3.11

• 12%

Operating Statistics

• Mining Operations: Strong recovery in metal production for Q2 2019 due to improved operational

efficiencies and higher ore grades

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(in Php mn)

Q1 2019 Q2 2019 +/- 1H 2019 1H 2018 +/- Gross Revenues 1,613 1,752 9% 3,365 4,646

• 28%

Smelting Charges 137 139

• 1%

276 377

• 27%

Net Revenues 1,476 1,613 9% 3,089 4,269

• 28%

Costs and Expenses 1,566 1,567

• 3,133

3,361

• 7%

Other Income (Charges) 294 143

• 51%

437 (129)

• Net Income

206 185

• 10%

391 552

• 29%

Core Net Income (Loss) (112) 93

• (19)

646

• EBITDA

217 443 104% 660 1,734

• 62%

Margins: EBITDA Margin (%) 13% 25% 12% 20% 37%

• 17%

Net Income Margin (%) 13% 11%

• 2%

12% 12%

• Financial Summary
• Core Net Income: Sharp sequential quarter rebound in Q2 2019 due to improved metal production
• Costs and Expenses: Impact of continuous cost containment programs
• Other Income (Charges): Reversal of previously written-off receivables

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(in Php mn)

June 2019 December 2018 Cash & Cash Equivalents 101 871 Receivables & Others 3,588 3,582 Total Current Assets 3,689 4,453 Property, Plant & Equipment 4,916 5,404 Deferred Exploration Costs 26,050 25,448 Others 5,408 5,406 Total Assets 40,064 40,712 Short-Term Debt 2,511 2,156 Others 2,531 4,104 Total Current Liabilities 5,042 6,260 Bonds Payable 7,520 7,333 Deferred Tax Liabilities & Others 2,780 2,790 Total Liabilities 15,973 17,012 Total Equity 24,091 23,699

• Total Assets: Silangan Project

accounts for more than 60% of total assets

• Short-Term Debt: Additional loan

availments for working capital purposes

Balance Sheet

558 715 347 112 18 71 1H 2019 1H 2018

CAPEX Distribution

(in Php Mn)

Padcal Silangan Other Mine Exploration

6 6

923 898

Capital Expenditure

PXP Energy Corporation Financial Highlights and Operational Updates

• 23% decrease in gross revenue due to:
• Lower average crude price; shut-in of SC14 Matinloc wells
• 22% decrease in cost and expenses due to:
• Plug and Abandonment costs in SC14 Matinloc
• Accrual of expenses
• 46 % lower net loss due to:
• Higher other income, lower cost and expenses offset by lower

revenue from petroleum

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Financial Highlights – Profit and Loss

(in PhP millions) 1H 2019 1H 2018 % Inc (Dec) Gross revenue ₱ 51 ₱ 67

• 23%

Cost and expenses 86 110

• 22%

Loss from operations (35) (44)

• 21%

Other income - net 17 11 55% Reported net income (loss) ₱ (18) ₱ (33)

• 46%

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Financial Highlights – Financial Position

As of Jun 30, 2019 2019 (Unaudited) As of Dec 31, 2018 2018 (Audited) % Inc (Dec) Cash & cash equivalents ₱ 280 ₱ 342

• 18.3%

Receivables and other CA 95 86 9.3% Current assets 374 429

• 12.7%

Deferred exploration costs & other NCA 6,765 6,818

• 0.8%

Total assets ₱ 7,139 ₱ 7,247

• 1.5%

As of Jun 30, 2019 2019 (Unaudited) As of Dec 31, 2018 2018 (Audited) % Inc (Dec) Due to affiliate ₱ 739 ₱ 2,125

• 65.2%

Accounts payable & others 28 34

• 18.7%

Current liabilities 767 2,160

• 64.5%

Deferred income tax liability 1,114 1,113 0.1% Others 200 192 4.3% Non-current liabilities 1,314 1,305 0.7% Total liabilities 2 2,082 3 3,465

• 39.9%

Capital stock 1,960 1,960 0.0% Additional Paid-in Capital 2,816 2,821

• Subscription receivable

(924) (2,311)

• Deficit

(1,379) (1,374) 0.4% Others 211 276

• 23.5%

Non-controlling interest 2,374 2,410

• 1.5%

Total equity 5,058 3,782 33.7% Total Liabilities and SHE ₱ 7,139 ₱ 7,247

• 1.5%

ASSETS (in PHP millions) LIABILITIES AND STOCKHOLDERS’ EQUITY (in PHP millions)

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Operations Update

4 SC 6B SC 14C2 SC 6A Cadlao SC 14C1 SC 14B SC 14A

TUMBES BASIN, OFFSHORE PERU

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SC 72 Recto Bank (Forum 70%)

• Under Force Majeure (FM) since December 15, 2014.
• Forum will have 20 months upon lifting of the FM to drill the two (2) commitment wells.
• Completed the broadband PSDM reprocessing of 565 sq. km 3D seismic data. Started

the interpretation of the said reprocessed data.

• The acceptance by the Philippines of China’s version of the Terms of Reference on joint
• il and gas exploration in the West Philippine Sea, which was reported in early July

2019, another step towards the lifting of the FM in SC 72.

SC 74 Linapacan Block (PXP 70%)

• The gravity modeling and seismic interpretation of MC2D data are underway.
• Ongoing paleodating of rock samples collected during the fieldwork in the Calamian

Islands last June 2018 by the UP National Institute of Geological Sciences.

• The SC 74 and SC 14C2 (West Linapacan) Consortia are conducting Rock Physics and

Quantitative Interpretation (QI) studies over the Linapacan and West Linapacan areas with Ikon Science as contractor.

SC 75 NW Palawan (PXP 50%)

• Under FM since December 27, 2015.
• Sub-Phase 2 will have a term of 18 months upon lifting of FM with the acquisition of

1,000 sq km of 3D seismic data as the minimum work commitment.

Operations Update 1/2

5 1 August 2019 CONFIDENTIAL

SC 40 North Cebu (Forum 66.67%)

• Gravity data modeling is underway using land gravity data acquired in 2018.

SC 14C1 Galoc (Forum 2.27%)

• Continued production in Galoc Field. Cumulative production from October 2008 to June

2019 stood at 21.73 million barrels of oil.

• The Consortium led by Galoc Production Company (GPC) plans to install a Condensate

Recovery Unit (CRU) onboard the FPSO Rubicon Intrepid starting August 2019 to recover condensate from the gas stream for an additional liquid production of about 250- 300 barrels per day. The CRU will be fully operational by October 2019.

Peru Block Z-38 (Pitkin 25%)

• Karoon entered into rig negotiations during the second quarter to secure a drillship in

preparation for drilling the Marina-1X exploration well planned for late calendar year 2019/early 2020. The Marina prospect has an unrisked best estimate prospective resource of 256 mmbbls of oil at 100% (64 mmbbls net to Pitkin). This prospect will be the first well drilled in Block Z-38. Pitkin is carried in the cost of Marina-1X and a second future well under a Farm-in Agreement signed with Karoon in 2008.

• The participating interest in Z-38 are as follows: Karoon Gas – 40%, Tullow Oil – 35%,

and Pitkin Petroleum – 25%

Operations Update 2/2

6 1 August 2019 CONFIDENTIAL