Our opinion on the current state of EFORA(EEL)Efora Energy (EEL) is an African oil and gas company incorporated in 1993 and listed on the JSE in October 1994. The company is involved in numerous projects from oil production to midstream and downstream distribution. It has operations in Egypt, Nigeria, the DRC, Zimbabwe, and South Africa. Africoil is a subsidiary that distributes 45 million liters of oil products monthly and has two depots in Boland and Beitbridge. Most of its sales are in South Africa.
In Egypt, the company owns the Mena International Petroleum Company, which is developing the Lagia oil field in the Sinai Peninsula. In the DRC, the company owns 68% of Semliki, which in turn owns 18.3% of block III in the North-East of the DRC bordering Uganda. This is in an exploratory phase. In Nigeria, the company has a 50% joint venture with Energy Equity Resources (EER) to lift and trade Nigerian oil.
In its results for the six months to 31st August 2021 (published on 27th November 2023), the company reported revenue down 95% and a headline loss of 0.32c per share compared with a loss of 25.08c in the previous period. In its results for the six months to 31st August 2022, the company reported headline earnings per share (HEPS) would be between 0.68c and 0.74c compared with a loss of 0.32c in the previous period. In a trading statement for the six months to 31st August 2023, the company estimated that it would make a headline loss per share of between 0.67c and 0.81c compared with a profit of 0.71c in the previous period.
This share has been suspended since 9th October 2020 because of delays in producing its financial statements. On 31st January, it announced that it expected to produce interim and final accounts for 2023 by 28th February 2024, but that deadline has passed without the reports being issued.
Given the significant delays in producing financial statements and the ongoing suspension of the share, Efora Energy is currently a high-risk investment. The lack of timely financial reporting and the resulting suspension from trading make it impractical for most investors. Potential investors should wait for the company to resolve its reporting issues and for the share to resume trading before considering any investment.
