Berenberg adjusted its 2026 forecasts for Energean (ENOG.L) following the company's first-quarter trading update, which included guidance from reinstated production in Israel, a reduced first-quarter dividend, and higher capital expenditure projections.
In the three months ended March 31, the natural gas-focused exploration and production company reported a 21% year-over-year decline in production, while revenue plummeted 30% to $288 million, mainly driven by the 41-day shutdown of operations in Israel.
"Energean has reinstated production guidance in Israel at 98-104kboe/d, down 9% at the mid-point. Production guidance in the rest of the portfolio is unchanged. Operating cost guidance is largely unchanged but total capex is now expected to be $800m-860m, up by 8% at the mid-point versus the previous range," analysts said in a Wednesday note. "Overall, our operating forecasts are slightly improved given our previous caution on the Karish gas field shutdown (offshore Israel), and receivables recovery in Egypt means our net debt forecast is largely unchanged for the year despite higher capex."
As such, the research firm raised its full-year 2026 production and EBITDA estimates by 5% and 3%, respectively. Meanwhile, it trimmed its dividend projections following the company's lower-than-expected first-quarter dividend of $0.1 per share, adding that it expects a return to $0.3 per share from the second quarter.
"We leave our 765p price target and Hold rating unchanged with a sustained reduction in net debt needed to increase our confidence in delivering NAV upside and increased shareholder returns," Berenberg added.