Slide 1: Financial Year 2016 Financial Results
Financial Year 2016 ABN 51 009 799 455 Financial Results 30 August 2016
Slide 2: Financial year highlights
Financial year highlights 3% increase in production from prior year to 1,354,982 barrels, 13% increase in sales Performance to 1,376,069 barrels at an average realised price (inclusive of hedging) of US$55.19 per barrel, generating revenue of US$76.0 million. US$16.1 million cash on hand at 30 June
Slide 3: Operational results
Operational results Lost Time Injury Frequency Rate (LTIFR) of 0.0, Total Reportable Injury Frequency Rate (TRIFR) of 0.0 at HSSE 30 June 2016 over a 12 month rolling period (~60,000 manhours). No significant loss of containment incidents (<1 barrel of oil equivalent) Continued strong production fro
Slide 4: Five year financial year performance
Five year financial year performance Production (bbls) Revenue (US$m) 2016 1,354,982 2016 76.0 2015 104.0 2015 1,310,485 2014 138.5 2014 1,434,534 2013 48.1 2013 503,619 2012 50.4 2012 439,298 Maari Beibu Maari Beibu 2P + 2C Reserves and Contingent Resources (mmboe) Net operating income after opex (
Slide 5: Continued debt reduction despite low oil price environment and a new funding proposal
Continued debt reduction despite low oil price environment and a new funding proposal to alleviate funding concerns 250 Proposed IMC financing facility will result in an average funding cost of LIBOR + ~5%. 200 160 160 160 150 US$ million 120 120 120 120 120 120 100 50 80 80 80 80 80 59 50 50 50 0 1
Slide 6: Profit and loss
Profit and loss 12 Months to June 12 Months to June Change Change 2016 2015 (US$ million) (US$ million) (US$ million) (%) Production 1.35 mmbo 1.31 mmbo 0.04 mmbo 3% Sales 1.38 mmbo 1.21mmbo 0.17 mmbo 13% Realised oil price US$55.19/bbl US$85.59/bbl (US$30.40/bbl) (36%) Sales revenue 76.0 104.0 (28.
Slide 7: Profit and loss analysis
Profit and loss analysis 76.0 (23.8) 70 6.5 (4.7) 54.0 (37.1) 50 30 (147.5) 10 (144.5) (10) US$ million (30) (50) (70) (90) (110) (1.9) (17.3) (130) 5.2 (132.5) (150) Revenue Operating Costs General & Admin Gains on buy back EBITDAX Depreciation & Impairment of Exploration EBIT Finance Costs Income
Slide 8: HZN's share of Block 22/12 production to remain above net working interest
HZN’s share of Block 22/12 production to remain above net working interest 0.40 Forecast 40% 0.35 35% 0.30 30% 26.95% 0.25 25% mmboe 0.20 20% 0.15 15% 0.10 10% 0.05 5% - 0% Jun-15 Aug-15 Apr-16 Jun-16 Apr-17 Jun-17 Apr-18 Jun-18 Apr-19 Jun-19 Apr-20 Jun-20 Dec-15 Feb-16 Aug-16 Dec-16 Feb-17 Aug-17 D
Slide 9: Operating costs (per bbl) continue to decline
Operating costs (per bbl) continue to decline 20 US$/bbl Unit production cost has reduced by over 20% in the last 2-years 15 16.62 14.10 12.90 10 5 0 FY14 FY15 FY16 Note: Normalised for inventory adjustment, freight, demurrage and repair costs 9
Slide 10: Independent valuation points to PNG upside
Independent valuation points to PNG upside Impairment charge of US$147.5m brings carrying values inline with the independent valuation ranges PNG China Independent risked value range New Independent unrisked value range Zealand HZN carrying value after impairment charge 0 50 100 150 200 460 250 US$
Slide 11: Cash flow
Cash flow 12 months to 12 months to Change Change June 2016 June 2015 (US$ million) (US$ million) (US$ million) (%) Opening cash 61.3 98.9 (37.6) (38) Net cash from operating activities (excl 52.5 66.8 (14.3) (21) G&A/other) General & Administrative/Other (excluding (8.3)* (8.0) (0.3) (4) depreciati
Slide 12: Cash flow analysis
Cash flow analysis 120 52.5 (8.3) (58.3) 100 80 US$ million 60 (17.7) 40 (8.6) 61.3 (3.8) 20 (1.0) 16.1 - Opening cash and Net Cash from G&A / Other Debt Repayment Development Exploration Prepaid Effects of FX rate Cash and cash cash equivalents Operating Expenditure Expenditure/Plant Expenditure Ab
Slide 13: Production levels unaffected despite capex reduction
Production levels unaffected despite capex reduction 160 1.6 1.4 1.4 140 1.3 1.4 135.7 120 1.2 Annual production in mmboe Capex has been reduced Production (mmboe) 100 1.0 by over 80% in four years Capex (US$m) 80 95.6 0.8 60 0.6 0.5 78.0 40 0.4 20 0.2 24.5 0 - FY13 FY14 FY15 FY16 Horizon Oil’s prod
Slide 14: Net Reserves and Contingent Resources as at 30 June 2016
Net Reserves1 and Contingent Resources1 as at 30 June 2016 RESERVES CONTINGENT RESOURCES Proven + Probable Proven + Probable Block 22/12 WZ6- Block 22/12 WZ12-8E 4 ; 2.8 12 + WZ12-8W; mmbbl Block 22/12 WZ6-12 PMP 38160 0.2 mmbbl + WZ12-8W 3 ; PMP 38160 (Maari/Manaia); (Maari/Manaia) 2 ; 2.9 mmbbl PD
Slide 15: Hedging acts as a buffer in low price environment
Hedging acts as a buffer in low price environment 29% of FY2016 oil sales Effectiveness of Group’s oil price hedging were hedged at a weighted average price of US$95.48 per barrel generating hedge 120 revenues of US$19.5 million. 100 Additional 270,300 bbls hedged through remainder 80 2016 to Ma
Slide 16: Outlook for the next 12 months
Outlook for the next 12 months Corporate Outlook Barring unforeseen events, operating cashflows expected to increase as a result of additional revenues earned from China production entitlement through cost recovery, combined with effect of hedge position Continued focus on reduction of overall g