MedservRegis plc - Updated Financial Forecasts

On 10 November 2022, MedservRegis plc published a Prospectus following regulatory approval for the admissibility to listing on the Official List of the Malta Stock Exchange of up to €13 million 5% secured bonds maturing in 2029.

The Prospectus provides updated financial forecasts for the current financial year ending 31 December 2022 as well as financial projections for the 2023 financial year. The main highlights are:

  • In 2022, revenues are now expected to climb to €54.7 million compared to the previous forecast of €48.8 million reflecting improved drilling activity in Cyprus and Egypt as well as the contribution from non-energy related business generated out of the Group’s base at the Malta Freeport Terminal. Elsewhere in the Middle East, METS Oman is the Group’s main revenue generator while in Sub-Sahara Africa, MedservRegis is mainly active in Mozambique and Angola. For 2023, MedservRegis is projecting its revenues to increase by 8.3% to €59.2 million reflecting the start of new operations offshore Libya where the Group will assist Mellitah Oil & Gas B.V. (which is a joint venture between the Libyan National Oil Corporation and Eni) in projects involving the drilling of over 30 wells. Furthermore, the projected growth also includes the new activity in Uganda where MedservRegis is supporting the construction of a 1,440 km pipeline from Uganda to Tanzania (also known as the ‘East African Crude Oil Pipeline’ project) which is a multi-billion project for the delivery of crude oil extracted out of the ‘Tilenga’ oilfields around Lake Albert.
  • Given the higher level of business than previously anticipated, adjusted EBITDA in 2022 is now expected to increase to €11.6 million compared to the previous forecast of €10.3 million. This growth is projected to be followed by an increase of a further 21.7% in 2023 to €14.2 million which would also translate into an improved margin of just under 24% compared to 21.3% in 2022.
  • After accounting for depreciation and amortisation charges, net finance costs, and tax, MedservRegis plc is anticipating a marginal net profit of €0.29 million in 2022 (compared to the previous forecast of a net loss of €0.69 million) followed by a net profit of €1.68 million in 2023.
  • In terms of financial position, it is expected that the Group will continue to reduce its net indebtedness to €52.9 million as at the end of 2023 compared to €60.3 million as at 31 December 2021. Coupled with the improvement in earnings, the interest cover is anticipated to reach almost 4 times in 2023 (compared to 2.29 times in 2019 prior to the pandemic and the reverse merger with Regis Holdings Limited which took place in 2021) while the net debt-to-EBITDA multiple is projected to drop to 3.74 times in 2023 (compared to 6.67 times in 2019). Moreover, in view of the stronger equity base, the Group’s gearing ratio is projected to drop below 50% by 2023 compared to almost 95% in 2020.


Financial Analysis Summary dated 9 November 2022