Serica Energy PLC on Tuesday lowered its output guidance, sending its shares into reverse, as it grapples with a slower than predicted ramp-up from two assets after summer shutdowns.

Serica shares fell 9.9% to 241.40 pence each in London on Tuesday late morning.

The UK North Sea-focused oil and gas company said revenue in the first half of 2023 fell 3.6% to £340.6 million from £353.5 million. Pretax profit, however, surged 53% to £298.3 million from £194.5 million.

It booked unrealised hedging income of £20.5 million, having suffered a £56.4 million hit a year earlier. In addition, it booked a £139.6 million on acquisition, having not booked one a year earlier.

‘The completion of the Tailwind acquisition in March represented a step change in the scale and diversity of Serica, achieving a longstanding strategic goal. We have stated consistently our intention to continue investing in the enlarged portfolio, to add to it in a disciplined fashion if the right opportunities arise and to make further cash returns to shareholders,’ Chief Executive Officer Mitch Flegg said.

‘Serica’s current circumstances and optimism reflected in its investment plans should not mask the fact that we share the widespread concerns within the sector about the health of the UK’s offshore upstream industry given the current fiscal regime and future uncertainties.’

Serica lifted its interim dividend by 13% to 9 pence per share from 8p a year earlier.

However, it trimmed output guidance. It now expects 2023 production between 40,000 and 45,000 barrels of oil equivalent per day, ‘due to slower than expected ramp up of production from Bruce and Triton hubs following planned summer shutdowns’. It had previously guided for output between 40,000 and 47,000 boe per day.

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