United Oil & Gas Reports £2.44m Loss, Faces Going Concern Uncertainty
Why we think this is bad
The oil and gas explorer's financial position looks precarious. With no revenue and ongoing losses, they're burning through cash at an alarming rate. Sure, they've got some potentially juicy assets in Jamaica and the UK, but let's face it, those are high-risk plays that won't be filling the coffers anytime soon. The fact they've had to pass the hat around for cash twice in 2024 and again in early 2025 doesn't exactly inspire confidence. And when your auditors are raising eyebrows about your ability to keep the lights on, well, that's not a good look. The market's tough out there, and these folks are sailing in choppy waters without much of a lifejacket.
Key Points
- Loss after tax of $2.44m in 2024, improved from $20.37m loss in 2023
- No revenue in 2024 due to exit from producing assets
- Cash balances decreased to $0.8m from $2.0m in 2023
- Focus shifted to high-risk exploration assets in Jamaica and UK
- Multiple rounds of fundraising in 2024 and early 2025
- Material uncertainty about ability to continue as a going concern
- Future heavily dependent on successful farm-out of Jamaican asset
- Two-year extension secured for Jamaican licence until January 2028
- Waddock Cross licence in UK extended for 5 years until March 2029
- Challenging market conditions and economic uncertainty noted
Summary
United Oil & Gas Plc reported final results for 2024, revealing a challenging year with significant changes. The company reported a loss after tax of $2.44m, an improvement from the $20.37m loss in 2023, but still concerning. The company no longer has any producing assets, resulting in no revenue for 2024, compared to $11.6m in 2023. Cash balances decreased to $0.8m from $2.0m in 2023. The company has shifted focus to exploration and appraisal assets in Jamaica and the UK, which carry high risk and uncertainty. The company had to raise funds twice during 2024 and again in early 2025, indicating ongoing cash needs. Most critically, there's a material uncertainty about the company's ability to continue as a going concern. The future outlook heavily relies on successful farm-out of its Jamaican asset and progression of its UK asset, both carrying significant risks.