Strong financial position and robust producing assets, despite low gas price environment
- Well capitalised, with cash balances of £25.7 million (US$33.4 million) as at 30 June 2020
- Total asset base increased by 9% to £89.8 million at 30 June 2020 (2019: £82.3 million)
- Net assets increased to £71.3 million at 30 June 2020 (2019: £68.3 million)
- Revenue for the period was £4.1 million (2019: £8.3 million), reflecting the record-low gas prices seen during the year
- Gross profit achieved of £1.3 million (2019: £5.7 million), showing the robustness of Parkmead’s gas assets
- Net profit before tax and non-cash impairment charges was £0.8 million
- Gas prices have fallen from highs of approximately € 25.7/MWh in October 2018 to lows not seen in over a decade to around € 5.0/MWh in June 2020 due to the oversupply of Liquefied Natural Gas (LNG) into the European market and the unprecedented effect of COVID-19
- Gas prices have since rebounded strongly to approximately € 14.0/MWh in November 2020
- Parkmead’s Netherlands assets remain very low cost to operate, and were uninterrupted by the lockdown restrictions introduced by the Dutch Government in March
- Netherlands gas production, plus benchmarking & economics consultancy, provides positive operating cash flow to Parkmead
- Parkmead maintains strict financial discipline with very low operating costs
Significant wind farm potential; high-grading of renewables portfolio underway
- In September 2019, the Company acquired Pitreadie Farm Limited (“Pitreadie”) as part of its expansion into renewable energy
- Studies being conducted on the Group’s acquired onshore land for the potential development of a large wind farm
- One of the large areas of land acquired by Parkmead lies adjacent to the Mid Hill Wind Farm which encompasses 33 Siemens wind turbines with a generating capacity of around 75MW
- High-grading of renewables portfolio underway with expected divestments of non-core acreage
- Renewable energy opportunities accessed through strategic acquisition of Pitreadie, where a gain on purchase was recorded of £0.36 million
- Parkmead’s early commitment to building a balanced energy business through its focus on gas, widely seen as the primary transition fuel, pre-empted the recent energy transition acceleration
- Revenue-generating renewable energy opportunities continue to be analysed by Parkmead as it seeks to build out its renewable energy portfolio