Europa Oil & Gas hits out at 'continued uncertainty' in latest results

Shares in Europa Oil & Gas have fallen 7% after the oil and gas exploration firm said it continues to face challenging conditions.

Europa, the largest independent oil and gas company focused on Europe, swung to a pre-tax loss of £1.4 million in the six months to the end of June, from £3.4 million profit from the same period last year.

Revenue dropped to £1.5 million from £2.7 million, as gas prices plunged due to a combination of a mild winter in the UK and Europe and the coronavirus pandemic.

In a statement to the London Stock Exchange, Europa said: "The last six months has been a turbulent period for the financial markets and the energy markets specifically, with the Covid-19 pandemic having a significant negative impact on demand for energy."

The company said the outlook remains uncertain, with the coronavirus pandemic likely to continue to weigh on global demand for oil and gas in the second half of 2020.

"Our current focus is on preserving cash, whilst seeking to position the business to take advantage of market conditions as they improve," said Europa chief executive Simon Oddie.

"We believe that, once the uncertainty created by Covid-19 has abated and as activity returns in our core markets, Europa is well placed to re-commence profitable operations."

Europa, which has interests in licences across the UK, Ireland, France, Romania, and Spain, said it had reduced its cash operating costs by 20% in the first half of 2020.

The company added that it had £12.4 million of cash as of the end of June and said it had also secured a £10 million loan facility from its lender, Investec.

Europa shares were down 7% to 100p in morning trading.

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