Q3 2018 Results
SDX has announced strong Q3 2018 earnings with a netback achieved of US$12.0 million compared to US$7.5 million a year earlier as it benefitted from higher production and higher realised oil and gas prices. The balance sheet remains strong despite the high level of spend with net cash of US$18.7 million at the end of the quarter. We have updated our DD&A estimate based upon the Q3’18 results and this has resulted in our 2018 net income estimate being revised down to c.US$7.7 million. This revision will not affect the more important cash flow estimate and valuation of the business. We note, however, that our FY 2019E estimates will have to be reviewed further given some slight slippage in the start of production in South Disouq. We will adjust these numbers once we have a clearer idea of start up.