Pharos Energy 2025 results: cash up, drilling momentum, and a 10% dividend lift
Pharos Energy has wrapped up 2025 with solid operational delivery and a stronger balance sheet, despite a softer oil price backdrop. The company is debt free, cash generative, and in the middle of its most active Vietnam drilling programme in years. The Board has recommended a higher final dividend, taking the full-year payout up 10%.
Headline numbers investors should know
| Metric | 2025 | 2024 |
|---|---|---|
| Group production (boepd – barrels of oil equivalent per day) | 5,398 | 5,801 |
| Vietnam production (boepd) | 4,095 | 4,361 |
| Egypt production (bopd – barrels of oil per day) | 1,303 | 1,440 |
| Revenue | $114.6m | $136.1m |
| Operating cash flow (net cash from ops) | $55.6m | $54.0m |
| Cash operating cost per boe | $19.39 | $17.80 |
| Net cash at year end | $40.2m | $16.5m |
| Post-tax (loss)/profit | $(6.6)m | $23.6m |
| Dividend per share (full year) | 1.331 pence | 1.21 pence |
| Egypt receivables at year end | $7.4m | Not disclosed here |
| 2P reserves (mmboe) | 18.4 | 21.3 (as at 1 Jan 2025) |
Vietnam: six-well programme driving near-term catalysts
Pharos kicked off a six-well programme across TGT and CNV in October 2025 – four infill wells to sustain output and two appraisal wells to unlock growth. Two TGT infill wells on the H1 and H5 fault blocks were finished on time, under budget, and are producing. The final TGT infill well on H4 hit total depth on 21 March 2026 and is expected onstream in April.
The TGT-18X appraisal well completed drilling on time and budget in February, with testing now underway. An update is promised in April or early May. Over at CNV, the CNV-8P infill well completed in mid-March and is due on production shortly, while the CNV-5X appraisal well spudded in mid-March and should complete by mid-2026.
Guidance for 2026 Vietnam production is 4,000 – 4,950 boepd. Management notes that success at both appraisal wells (TGT-18X and CNV-5X) could lift Vietnam volumes by up to 20% and de-risk further developments. That is a clear near-term catalyst set.
Egypt: improved fiscal terms, receivables progress, and a six-well plan
The big structural change was approval from EGPC’s Executive Board to consolidate El Fayum and North Beni Suef into a single concession with better fiscal terms and up to 20-year lease extensions. Ratification by the Egyptian Parliament is expected later in 2026, with the terms applied retrospectively from 5 October 2025.
Cash collection stepped up too: EGPC paid $20 million on 31 December, halving the company’s receivable exposure to its lowest level since 2021 – $7.4m at year end. That also doubled year-end cash to $40.2m.
Operationally, a six-well work programme is set for 2026 (four at El Fayum, two at NBS). One rig is secured for El Fayum and another is being contracted for NBS. Management expects the programme to complete by the end of Q3 2026, with Egypt net production guidance at 1,200 – 1,450 bopd. On resources, the consolidated concession could move roughly 3.1 MMstb from contingent to 2P reserves (25% increase from year end 2024, net to Pharos) once through the approvals process.
Cash, dividends and hedging: balance sheet built for options
Pharos ends 2025 debt free with $40.2m in cash and strong cash generation from operations of $55.6m. The Board has recommended a final dividend of $5.2m, or 0.9317 pence per share, for payment in July 2026 (subject to AGM approval), taking the 2025 dividend to 1.331 pence per share – up 10% year on year. The company’s policy is to return no less than 10% of operating cash flow each year.
Hedging remains modest. In 2025, 29% of production was hedged with zero-cost collars and there were no realised hedge gains or losses. For 2026, around 19% of total group entitlement is hedged using a mix of collars and puts, with an average floor price of about $59/bbl and an average ceiling of about $74.7/bbl. The majority of volumes remain unhedged, keeping leverage to higher oil prices.
Costs and profitability: where the squeeze showed
Lower realised prices were the main drag in 2025. Group revenue slipped to $114.6m and Pharos reported a post-tax loss of $6.6m, largely reflecting price pressure and taxes. Cash operating costs per barrel rose to $19.39/boe (from $17.80/boe), driven mainly by Egypt where workover activity picked up and a smaller capital programme pushed more costs into opex. Depreciation, depletion and amortisation remained tight at $46.4m.
Even so, operating cash flow held up at $55.6m and EBITDAX was $55.7m. That underpins the dividend and the ongoing drilling programme.
Exploration upside: Vietnam Blocks 125 & 126 farm-out process
Pharos continues to advance its high-impact exploration on Vietnam Blocks 125 & 126. A two-year extension to the exploration period was granted in June 2025, taking the deadline to 8 November 2027. The formal farm-out process is under way with active discussions; management guides to further updates by mid-2026. Long-lead items are already in hand and engineering studies are complete for a first well on Prospect A.
2026 guidance and spending
- Group production: 5,200 – 6,400 boepd (Vietnam 4,000 – 4,950 boepd; Egypt 1,200 – 1,450 bopd).
- Capex: $50m (Vietnam $39m; Egypt $11m).
- Vietnam six-well campaign to complete by mid-2026; appraisal results expected April or early May.
- Egypt six-well programme to start shortly; parliamentary ratification of the consolidated concession expected later in 2026 with a retroactive date of 5 October 2025.
- Emissions: on track to reach the interim 5% reduction target for 2024-2026 versus the 2021 baseline.
My take: why this matters for shareholders
Positives I like
- Balance sheet strength: $40.2m net cash and debt free gives room to keep investing and paying dividends.
- Near-term catalysts: multiple well results due by mid-2026, with up to a 20% Vietnam uplift if both appraisals work.
- Egypt progress: improved fiscal terms and a $20m cash payment reduce risk and raise the incentive to drill.
- Shareholder returns: full-year dividend up 10% to 1.331 pence per share, aligned with the ≥10% of OCF policy.
- Safety and delivery: zero LTIs and wells drilled on time and under budget – it sounds small, but it compounds.
What to keep an eye on
- Oil price volatility: management highlights ongoing uncertainty; only about 19% of 2026 volumes are hedged.
- Egypt ratification and receivables: parliamentary approval is expected later in 2026; receivables are down to $7.4m, but continued timely payments remain important.
- Cost creep: cash opex per boe ticked up to $19.39; sustaining or reversing that trend would help margins.
- Reserves: 2P reserves fell to 18.4 mmboe after production and revisions; appraisal success could help rebuild.
- Farm-out on Blocks 125 & 126: terms and timing matter – a good partner could de-risk a basin-opening well.
Bottom line
Pharos has used 2025 to strengthen its footing: more cash, no debt, a cleaner Egypt position, and a fully funded drilling programme in Vietnam that could move the needle in 2026. The proposed final dividend of 0.9317 pence per share caps a year of disciplined delivery.
From here, it’s all about execution and catalysts: appraisal results in Vietnam, Egyptian ratification, and progress on the 125 & 126 farm-out. If those break right – and oil prices behave – there’s a clear path to higher production, improved cash flows, and continued returns.
