Reabold Resources : Exane BNP Research Note - 20th October 2021

SPONSORED

RESEARCH

OIL & GAS

REABOLD RESOURCES	PRICE	0.16p	(+132%)  0.47p (+203%)
VALUATION (UPSIDE) 0.36p

Sales process commencing for Victory project, positive

20 OCTOBER 2021 at 09:20*

Thomas Martin

([phone]

[e-mail]

Sales process commences

Reabold has announced that Corallian, a company through which Reabold holds its 49.99% effective interest in the UK North Sea Victory gas development project, has commenced a strategic review process to solicit bids for up to a 100% interest in Corallian.

Victory is the largest asset in the portfolio

Our risked NAV for Victory (incorporating a 55% chance of success) stands at 0.34p/sh (0.61p/sh un-risked), equivalent to ~ 2/3 of the gross asset value (pre balance sheet adjustments, G&A etc). This announcement is consistent with our view that Victory could be the first asset in the portfolio to be monetised, potentially in the next year.

Updated resource estimates; 2C increases 14%

Reabold also announces an updated CPR has been produced for Victory, which attributes 2C (best case) recoverablecrothersresou ces of 179bcf dry gas. This is ~14% above the prior un-risked estimate of 157bcf, which is incorporated in our analysis. The revised resource assessment comprises

of resources f which development is pending, plus 34bcf of upside potential for which development is unclarified. It is believed the incremental 34bcf is connected to the development145bcf wells, but production data will be required to confirm this. We make no changes to our analysis this morning, which equates to inclusion of ~35% of the 34bcf increment in our un-risked estimates.

Core NAV offers ~130% upside

Clearly this is the start of the process, and it is not certain a sale will be agreed, but we believe the disposal of Victory would be a material value catalyst for Reabold. The closing share price offers ~130% upside to our 0.36p/sh core NAV, which only incorporates value for Victory and California (which is small in the context of the business). Incorporating risked value for the assets under appraisal, around which there is a greater degree of uncertainty, our 0.47p/sh discovered resource NAV offers ~200% upside. Please refer to our 15/10/21 initiation, 'Being Bold'for further details.

Price (19 October 2021)				0.16p	Performance(1)	1w	1m	3m	12m
Market cap (GBPm / EURm)				14 / 16		Absolute(%)	(24)	(39)	(61)	(75)
Free float (GBPm / EURm)				14 / 16		Rel. Oil & Gas(%)	(26)	(47)	(68)	(84)
EV (GBPm / EURm)				-5.6 /-7		Rel. MSCI Small Cap(%)	(27)	(39)	(63)	(81)
3m avg volume (GBPm / EURm)			0.1 / 0.2
Refinitiv / Bloomberg			RBDR.L / RBD LN
Country / Sub Sector		UK / Exploration & Production
Financials	12/19	12/20	12/21e	12/22e	Valuation metrics(2)	12/19	12/20	12/21e	12/22e
EPS, Adjusted (p)	(0.11)	(0.04)	(0.03)	(0.03)		P/E (x)	-	-	-	-
EPS, Company (p)	(0.11)	(0.04)	(0.03)	(0.03)		Net yield (%)	-	-	-	-
EPS - Refinitiv (p)	-	(0.04)	(0.01)	(0.01)		FCF yield (%)	(11.9)	(9.3)	(15.0)	(8.4)
Net dividend (p)	-	-	-	-		EV/Sales (x)	-	4.2	-	-
						EV/EBITDA (x)	-	-	-	-
Sales (GBP)	1,452	1,035	1,216	1,177		EV/EBITA (x)	1.8	-	2.8	0.4
EBITA, Adj. (GBP)	(1,175)	(1,624)	(1,961)	(1,536)		EV/CE (x)	-	0.3	-	-
Net profit, Adj.(GBP)	(4,110)	(2,489)	(2,871)	(2,535)
ROCE (%)	(13.9)	(12.6)	(14.9)	(9.1)
Net Debt/EBITDA, Adj. (x)	-	-	-	-		All valuation metrics based on adjusted figures
Source: Exane BNPP (estimates), Refinitiv (consensus)	(1) In listing currency, with dividend reinvested (2) Yearly average prices for FY to end-12/19, 12/20

SPONSORED RESEARCH: Exane is receiving compensation from Reabold Resources to cover and produce research on the stock.

• Date and time (London Time) on which the investment recommendation was finalised. It may differ from the date and time of broad dissemination on the website. See Appendix (on p2) for Analyst Certification, Important Disclosures and Non-US Research Analyst disclosures.

Prepared solely for James Crothers. Not to be distributed anywhere. Strictly for personal use.

DISCLOSURE APPENDIX

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I, Thomas Martin, (authors of or contributors to the report) hereby certify that all of the views expressed in this report accurately reflect my personal view(s) about the company or companies and securities discussed in this report. No part of my compensation was, is, or will be, directly, or indirectly, related to the specific recommendations or views expressed in this research report.

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which, if any, of these disclosures apply to Exane's relationship with	subject company/ies.
Companies		Disclosures	crothers
Reabold Resources		13
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Exane BNP Paribas Research

Reabold Resources

20 OCTOBER 2021

page 2

Prepared solely for James Crothers. Not to be distributed anywhere. Strictly for personal use.

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Price and Ratings Chart

Reabold Resources

Historical closing price & target price (as of 19/10/2021)

Source: Exane BNP Paribas

Historical rating & target price changes

The latest company-specific disclosures, valuation methodologies and investment case risks for all other companies covered by this document are available on http://cube.exane.com/compliance.

Exane BNP Paribas Research

Reabold Resources

20 OCTOBER 2021

page 3

Prepared solely for James Crothers. Not to be distributed anywhere. Strictly for personal use.

REABOLD RESOURCES

Exploration & Production | Oil & Gas - United Kingdom

Company description

Reabold is an investment company focused on upstream oil & gas assets. Reabold aims to invest in discoveries, adding value through the appraisal/development planning stages, monetising investment prior to heavy development spend. The business is led by co-CEOs Sachin Oza and Stephen Williams, w ho have experience managing oil & gas investment at a number of investment institutions. Repsol's former head of global exploration is on the board, and experienced industry veteran Peter Dolan is an advisor.

Management

Sachin Oza, co-CEO

Stephen Williams, co-CEO

Anthony John Samaha, Financial Director

Ownership structure

Premier Fund Mgmt	10.2%
Ruffer Inv Mgmt	6.3%
Chelverton	5.2%
FIL	4.8%
Other Shareholders	73.6%

Revenues

100%

100% North America

Analyst

Thomas Martin ([phone]

[e-mail]

Price at 19 Oct. 21: 0.16p

0.36p (+132%) | 0.47p (+203%)

Peer group YTD performance

Stock		Price	YTD performance in EUR (%)
(19	Oct. 21)	Abs.		Rel. Sector
Maire Tecnimont (+)	EUR	3.58	103.2						58
Aker Solutions (=)	NOK	22.2	45.4
				13
Vivo Energy (+)	p	102	33.2					3
Drilling Co. (=)	DKK	253.0	31.3					2
Petrofac (=)	p	159	22.7	(5)
TechnipFMC (=)	EUR	6.7	16.8	(9)
T. EN (=)	EUR	14.1	11.0	(14)
Saipem (-)	EUR	2.20	(0.4)	(23)
Subsea 7 SA (+)	NOK	77.0	(3.4)	(25)
SBM Offshore (+)	EUR	14.3	(3.9)	(25)
GTT (-)	EUR	70.3	(9.6)	(30)
CGG (=)	EUR	0.65	(20.0)	(38)
Vallourec (=)	EUR	7.3	(20.6)	(38)
Rubis (=)	EUR	29.0	(21.2)	(39)
Wood (=)	p	228	(21.7)	(39)
Tecnicas Reun. (=)	EUR	8.4	(22.0)	(39)
SDX Energy (SR)	p	11.8	(30.4)	(46)
Reabold (SR)	p	0.16	(74.9)	(81)

Sector calendar

1. Oct. 21 Baker Hughes: Q3 Earnings 2021 (13:00 CET) Kinder Morgan, : Q3 Earnings 2021 (22:00 CET) TechnipFMC: Q3 Results 2021 (22:00 CET)
2. Oct. 21 T. EN: Q3 Results 2021 (07:30 CET)

Vivo Energy: Q3 Trading Statement 2021 (08:00 CET)

Valero Energy: Q3 Earnings 2021 (12:00 CET)

1. Oct. 21 Schlumberger: Q3 Results 2021 (13:00 CET)

1. Oct. 21 GALP Energia: Q3 Results 2021 (07:50 CET)

1. Oct. 21 Saipem: Q3 Results 2021
   Equinor: Equinor Q3 Results 2021 (06:45 CET)
   Aker Solutions: Q3 Results 2021 (07:00 CET)
   Neste: Q3 Results 2021 (08:00 CET)
   Hess: Q3 Earnings 2021 (12:00 CET)
2. Oct. 21 Saipem: Capital Markets Day
   Aker BP: Q3 Results 2021 (07:00 CET)
   Hunting Plc: Q3 Trading Statement 2021 (08:00 CET)
   Repsol: Q3 Results 2021 (08:00 CET)
   Royal Dutch: Royal Dutch Shell Q3 Results 2021 (08:00 CET)
   Total Energies: Total Q3 Results 2021 (08:30 CET)
   GTT: Q3 Results 2021 (17:45 CET)
3. Oct. 21 Eni: ENI Q3 Results 2021
   Lundin Energy: Q3 Results 2021 (07:30 CET)
   OMV: Q3 Results 2021 (07:30 CET)

Exane BNP Paribas Research

Reabold Resources

20 OCTOBER 2021

page 4

Prepared solely for James Crothers. Not to be distributed anywhere. Strictly for personal use.

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Prepared solely for James Crothers. Not to be distributed anywhere. Strictly for personal use.