Pharos Energy plc

("Pharos" or the "Company" or, together with its subsidiaries, the "Group")

Interim results for the six months ended 30 June 2025

Pharos Energy plc, an independent energy company with assets in Vietnam and Egypt, announces its interim results for the six months ended 30 June 2025. A conference call for analysts will take place at 09.00 BST today.

Katherine Roe, Chief Executive Officer, commented:

"We have continued to make strong strategic and operational progress during the first half of the year. The global stage remains challenging but our focus on operational excellence and financial discipline has delivered stable production averaging 5,642 boepd net, and continued strong cash generation, in line with our guidance.

"In Vietnam, we will begin an important and material six-well drilling campaign in the fourth quarter, with results expected in the first half of 2026. Preparations for drilling the TGT appraisal well 18X to unlock future upside are progressing well and, together with the planned CNV 5X-L1 appraisal and infill drilling campaign, are expected to de-risk additional development opportunities and drive production growth from 2026 onwards. On our exploration blocks 125 & 126, we have engaged with an independent third party adviser to conduct a formal process to identify farm-in partners. This process, together with the ordering of long lead items, provides optionality to pursue the long-term potential of these important exploration assets. The recent approval of a two-year PSC extension in June further supports this optionality.

"In Egypt, we continue to ensure we make economic investment decisions to maximise the value of these self-funding assets. We were pleased to have announced on Tuesday the approval from EGPC of a consolidated Concession Agreement, which brings an immediate uplift in the value of our Egyptian portfolio and a 25% increase from year-end 2024 2P reserves. The improved fiscal terms provide an attractive investment framework for both Pharos and our partner IPR. We will continue our cautious approach to capital allocation whilst we seek to continue the recovery of our outstanding receivables.

"Underpinning our progress is our strong cash flow generation and debt-free balance sheet. This financial strength allows us to announce today an interim dividend of 0.3993 pence per share for the 2025 financial year, an increase of 10% from last year. As we restart investment into our core assets, we will continue to be careful to maintain a strong financial position to support our commitment to shareholder returns.

"Looking ahead, we recognise scale is essential to delivering long-term growth and we have the financial flexibility to pursue both organic and inorganic opportunities. We remain committed to delivering value for shareholders through disciplined execution with strategic focus."

1H Operational Highlights

·      Group working interest production was 5,642 boepd net (1H 2024: 5,851 boepd net), in line with full year guidance:

o  Vietnam 4,183 boepd (1H 2024: 4,456 boepd)

o  Egypt 1,459 bopd (1H 2024: 1,395 bopd)

·      In Vietnam:

o  TGT: Rig contracts secured for the drilling of three infill wells and the 18X appraisal well in 4Q, targeting the block's untapped western area

o  CNV: Planning continues for the drilling of one infill well and the 5X-LI appraisal well in 4Q, intended to unlock the northern part of the field

o  Rig contracts also incorporate flexibility to drill optional appraisal wells on TGT and CNV

o  Blocks 125 & 126: Approval received from the Vietnamese Government for the two-year extension of the PSC Exploration Period (from 9 November 2025 to 8 November 2027); appointment of independent third party adviser to support formal process to identify a potential farm-in partner

·      In Egypt:

o  El Fayum: East Saad-1X well on production from 1 July following commercial discovery in February

o  North Beni Suef (NBS): 3D seismic data processing ongoing

1H Financial and Corporate Highlights

·      Group revenue $65.6m¹ (1H 2024: $65.0m)

·      Net loss $2.2m after adjusting for re-measurements of $0.6m (1H 2024: $2.7m net profit after adjusting for restructuring expenses, re-measurements and impairment reversals totalling $12.6m credit) ²

·      Cash generated from operations $31.9m (1H 2024: $44.3m including $10m one off payment from EGPC in USD)

·      Operating cash flow $16.1m³ (1H 2024: $27.9m including $10m one off payment from EGPC in USD)³

·      Cash operating costs $17.04/bbl⁴ (1H 2024: $17.09/bbl)⁴ 

·      Net cash as at 30 June 2025 of $22.6m (31 Dec 2024: $16.5m)

·      Egypt receivable balance at 30 June 2025 of $33.5m (31 Dec 2024: $29.5m), having received $5.5m in the six months to 30 June. Post our balance sheet date, we received an additional $5.6m as at 23 September 2025

·      Interim dividend in respect of 2024 of 0.363 pence per share was paid on 22 January 2025. The final dividend of 0.847 pence per share, amounting to $4.7m, was paid on 18 July 2025. The full year 2024 dividend was 1.210 pence per share, amounting to $6.5m in total

·      Appointment of João Saraiva e Silva as Non-Executive Chair on 26 June 2025

¹ No realised hedge gains or losses in the period (1H 2024: realised hedge losses of $0.1m)

² Refer to page 9 for a reconciliation to (Loss)/Profit after tax

³ Operating cash flow = Net cash from operating activities, as set out in the Cash Flow Statement

⁴  See Non-IFRS measures on page 30

Outlook

·      2025 production guidance range narrowed to 5,200-6,000 boepd (from 5,000 - 6,200 boepd), reflecting consistent production in Vietnam and lower than expected production in Egypt

·      Six-well drilling campaign in Vietnam about to commence and expected to deliver incremental production volumes in 2026 and beyond

·      Exploration farm-out of blocks 125 & 126 in Vietnam to continue with encouraging engagement from potential partners

·      Improved fiscal terms in Egypt now agreed; preparations for the committed work programme to commence imminently

·      Forecast cash capex for the full year expected to be c. $35m, of which $8.2m incurred in the first half. A further $22m relating to the 2025 drilling campaign is expected to fall into 1H 2026

·      Strategic focus on maximising value from existing portfolio whilst evaluating opportunities to build scale

Enquiries

Pharos Energy plc                                                                                                                                   Tel: 020 7747 2000

Katherine Roe, Chief Executive Officer 

Sue Rivett, Chief Financial Officer

Camarco                                                                                                                                                 Tel: 020 3757 4980

Billy Clegg | Georgia Edmonds | Violet Wilson | Tamsin Howard

Notes to editors

Pharos Energy plc is an independent energy company focused on delivering sustainable growth and returns to stakeholders, with a portfolio of stable production, development and exploration assets in Vietnam and Egypt. Led by an experienced team, Pharos is a cash generative business with a robust balance sheet and an established platform to deliver both organic growth and inorganic opportunities. 

Pharos is listed on the Main Market of the London Stock Exchange. For further information, please visit www.pharos.energy.

Operational Review

Health and Safety

We are pleased to report that in Egypt and Vietnam, we have worked with our partners to maintain our record of zero Lost Time Injury

(LTI) frequency rate through the first half of 2025. Although Pharos had no recordable spills in Vietnam and Egypt during the period, in July 2025, an incident involving a truck occurred in Egypt, causing damage to the truck and spillage of 178 barrels of crude oil. No injuries occurred during this incident. Following a thorough internal investigation, several operating procedures, such as additional training and monitoring systems, have been updated to prevent similar incidents in the future. All oil spilled was cleaned up efficiently and with limited environmental damage.

Safety continues to be the top priority for our business, and we are committed to operating safely and responsibly at all times to provide a safe and healthy working environment for staff and contractors working within our joint ventures or JOCs.

Vietnam

Vietnam Production

Production for the first half of 2025 from the TGT and CNV fields net to the Group's working interest averaged 4,183 boepd (1H 2024: 4,456 boepd), in line with guidance.

TGT 1H 2025 production averaged 11,053 boepd gross and 3,279 boepd net to Pharos (1H 2024: 11,086 boepd gross and 3,289 boepd net). CNV 1H 2025 production averaged 3,617 boepd gross and 904 boepd net to Pharos (1H 2024: 4,667 boepd gross and 1,167 boepd net).

Vietnam Development and Operations 

TGT & CNV Fields

Operational activities in the first half focused on securing rig contracts and preparing for appraisal and infill drilling programmes on both TGT and CNV in 2H 2025, with no new wells drilled. Overall production remained stable due to well interventions and production optimisation opportunities.

Following the approval of the TGT and CNV five-year licence extension in December, preparations are underway for the drilling of the 18X appraisal well and three infill wells on the TGT Field in Block 16-1. The success of the appraisal well would open up an undrilled area in the western part of the field. Contracts for two rigs were secured in August, and drilling is expected to commence in 4Q.

On the CNV Field in Block 9-2, planning continues for the drilling of the 5X-LI appraisal well and one infill well, expected to commence in 4Q. The appraisal well is intended to unlock the potential of the northern area of the field.

Additionally, 3D seismic reprocessing on both assets was completed in August and interpretation of this data is now underway.

Vietnam Exploration

Blocks 125 & 126

In 1H 2025, the Company continued to optimise its prospects and leads portfolio with detailed drilling engineering studies for the well on Prospect A.

Additionally, Pharos has engaged an independent third party adviser to support a formal process intended to identify a potential farm-in partner before exploration drilling commences with encouraging engagement. In parallel, discussions continue with rig contractors to retain optionality for the prospect to be drilled.

Most notably, the application for a two-year extension of the Blocks 125 & 126 PSC Exploration Period was granted by the Vietnamese Government in June 2025, extending the Exploration Period to 8 November 2027. This extension reflects the Government's continued support for Pharos and underlines our commitment to the region.

Egypt

Egypt Production

Production for the first half of 2025 from the El Fayum and NBS fields net to the Group's working interest averaged 1,459 bopd (1H 2024: 1,395 bopd), in line with guidance.

El Fayum 1H 2025 production averaged 3,093 bopd gross and 1,392 bopd net to Pharos (1H 2024: 2,867 bopd gross and 1,290 bopd net). NBS 1H 2025 production averaged 150 bopd gross and 67 bopd net to Pharos (1H 2024: 232 bopd gross and 105 bopd net).

Egypt Development and Operations 

El Fayum

Following its commercial discovery in February 2025, the East Saad-1X well was put on production from 1 July, contributing to total production.

Planning is underway for the two-well drilling programme which is expected to commence in 4Q.

Egypt Commercial

On 23 September, Pharos announced that it had received approval from the Executive Board of EGPC for the consolidation of the El Fayum and North Beni Suef Concession Agreements into a new consolidated concession agreement. Pharos will retain a 45% working interest in the Consolidated Concession, with IPR continuing as operator with a 55% working interest. In addition to the 12 development leases of the EF and NBS Concessions, the Consolidated Concession will include three new exploration areas.

The Consolidated Concession will unlock significant value in the Western Desert by improving certain fiscal terms, extending the duration of the licenses, and committing the Contractor parties (Pharos Group and IPR) to additional work programmes to deliver production growth. Based on Pharos' Competent Person's Reports as at 31 December 2024, the Consolidated Concession could result in moving approximately 3.1 MMstb from contingent resources to 2P reserves, or a 25% increase from year-end 2024, net to Pharos working interest.

The Consolidated Concession is subject to customary approvals and to Egyptian Parliamentary ratification, which is expected to take place in late 2025 or early 2026, but the new set of terms will start imminently.

The improved terms of the Consolidated Concession reset our investment into the assets in order to unlock further value.

Egypt Exploration

North Beni Suef

The processing of c.130 km² of 3D seismic data on NBS is ongoing and expected to complete by 4Q. The next steps are data mapping and interpretation.

Financial Review

Finance strategy

There has been solid financial performance from our operations in the first half of 2025 underpinning our strong liquidity position. Net cash has improved to $22.6m from $16.5m as at 31 December 2024. The Group remains debt free following the full and voluntary repayment of the RBL facility in September 2024. The El Fayum concession became profitable during 2024, reversing the previous historical tax losses since first production, and this has led to a gross-up of revenues and tax charge in the Income Statement by $1.1m in 1H 2025.

Returns to shareholders have been delivered through the completion in January 2025 of the third $3m share buyback programme and the payment of an interim dividend for 2024 of 0.363 pence per share in January 2025. A final dividend for 2024 of 0.847 pence per share was paid to shareholders in July 2025 and the Board is pleased to also announce an interim dividend of 0.3993 pence per share in respect of the year ended 31 December 2025. This dividend will be paid on 21 January 2026 to shareholders on the Company's register of members on 19 December 2025.

Key Data

¹ No realised hedge gains or losses in the period (1H 2024: realised hedge losses of $0.1m)

² See Non-IFRS measures on page 30

³ For 2025, includes $0.3m in respect of the $3m share buyback programme (the Second Programme Extension), which completed in January 2025. Also, Interim Group dividends of $2.3m in respect of the year ended 31 December 2025, announced in September 2025, will be paid to shareholders in January 2026. 

Operating Performance - Income Statement

Revenue

Oil & gas revenues were maintained for the period at $65.6m (1H 2024: $65.1m). This was despite a 12% decrease in Group average price realised. Whilst Group production was down 4% to 5,642 boepd, actual sales volumes increased 13% as additional cargoes were lifted from our oil inventories which supported the revenues in the period.

In Vietnam, revenues increased 1% to $56.2m (1H 2024: $55.8m). Sales volumes were higher by 14%, due to the timing of cargoes and maintenance shutdown at the BSR-owned Dung Quat refinery in 1H 2024 to which TGT crude is sold. The average realised crude oil price, including the premium received over Brent, was $77.25/bbl (1H 2024: $89.07/bbl), a 13% decrease. The average premium to Brent rose marginally to $5.67/bbl (1H 2024: $5.39/bbl).

In Egypt, revenues increased by 1% to $9.4m (1H 2024: $9.3m), inclusive of $1.1m (1H 2024: $nil) gross-up for corporate income taxes to be paid by EGPC on behalf of Pharos El Fayum. The average realised crude oil price, after discounts, was $65.85/bbl (1H 2024: $78.30/bbl), a decrease of 16%. There are two discounts applied to Egypt crude production - a general Western Desert Discount and one related specifically to El Fayum and NBS fields. Both are set by EGPC (the in-country regulator) and together increased to just over $6/bbl (1H 2024: just under $6/bbl).

Hedging

For 2025, the Group entered into zero cost collar hedges to protect the Brent component of forecast oil sales and to provide downside protection to cash flows in the event of commodity prices falling. The commodity hedges run until Dec 2025 and are settled monthly. Our hedging positions for the period resulted in no realised gain or loss (1H 2024: $0.1m realised loss). Additionally, the fair value as at 30 June 2025 was an unrealised gain of $0.1m for the remaining hedges in place (1H 2024: unrealised loss of $0.8m).

For 2H 2025, 26% of the Group's total oil entitlement production has been hedged, securing average floor and ceiling prices for the hedged volumes at $61.3/bbl and $84.5/bbl, respectively.

Group operating costs, DD&A and expenses

Cost of sales, inclusive of cash and non-cash elements, were 48% higher at $48.9m (1H 2024: $33.0m), and these results also capture the impairment reversal of financial asset in relation to EGPC receivables. There was a $16.7m change in inventories period on period as a result of the inventory build in 1H 2024 due to maintenance shutdown at the BSR-owned refinery in Vietnam and this build reduced in 1H 2025 with extra cargoes supporting the 1H 2025 revenue numbers. This effect, combined with a 20% reduction in June 2025 closing Brent price (plus premium) used for inventory valuation year on year (June 2025: $73.77/bbl; June 2024: $92.61/bbl), increased cost of sales in the period. Operating costs in Egypt increased 135% to $4.7m (1H 2024: $2.0m) and this was principally due to a credit of $2.7m in 1H 2024 relating to reversal of expected credit losses on EGPC trade receivables. However, the underlying cash operating costs decreased in 1H 2025 to $17.4m versus $18.2m in 1H 2024, see table below.

DD&A charges on production and development assets decreased to $21.8m (1H 2024: $23.8m), driven by the 4% reduction in Group production volumes. DD&A per bbl is currently $21.35/boe (1H 2024: $22.35/boe).

Administrative expenses of $4.1m (1H 2024: $4.7m) were 13% lower. After adjusting for non-cash share based payment charges of $0.3m (1H 2024: $0.3m), the underlying administrative expenses were $3.8m (1H 2024: $4.4m).

Other operating expenses of $0.2m (1H 2024: $0.6m) were 67% lower. In the prior year, $0.6m related to the posthumous vesting of share scheme awards to the former CEO of the Company, which was formally approved by the Remuneration Committee, settled in cash and paid to his estate with the agreement of the executor.

Cash Operating Costs

Cash operating costs at Group level, defined in the Non-IFRS measures section on page 30 and shown below, amounted to $17.4m (1H 2024: $18.2m), a 4% decrease over the same period last year. On a barrel of oil equivalent basis, this was $17.04/boe (1H 2024: $17.09/boe).

Cash operating costs in Vietnam decreased to $12.6m (1H 2024: $13.6m) in the period which equates to $16.64/bbl (1H 2024: $16.77/bbl). The decrease is primarily driven by lower costs relating to the FPSO as a result of higher production from TLJOC, which shares the facilities and the costs of the FPSO based on production rates (28.1% cost share in 1H 2025 compared to 23.0% in 1H 2024). This was partially offset by 6% lower production in 1H 2025.

Cash operating costs in Egypt were $4.8m (1H 2024: $4.6m) in the period, which equates to $18.18/bbl (1H 2024: $18.12/bbl). The 4% increase in cash operating costs was driven by increased transportation and chemical costs, and higher cost of well workovers.

¹ Includes impairment reversal of financial asset

Financing costs

Finance costs for the period were significantly lower at $1.2m (1H 2024: $2.6m) due to full voluntary repayment of the Group's RBL facility during September 2024. The unwinding of discount on Vietnam decommissioning provisions for 1H 2025 was $1.2m (1H 2024: $1.0m).

In 1H 2024, there was also interest expense and similar fees of $1.1m and foreign exchange losses of $0.5m, primarily driven by the devaluation of EGP against USD.

Taxation

The overall net tax charge of $13.3m (1H 2024: $18.3m) principally relates to tax charges in Vietnam of $12.2m (1H 2024: Vietnam tax charges of $18.3m).

The Group's effective tax rate approximates the statutory tax rate in Vietnam of 50%, after adjusting for non-deductible expenditure and tax losses not recognised.

The Egypt concessions are subject to corporate income tax at the standard rate of 40.55%, however responsibility for payment of corporate income taxes falls upon EGPC on behalf of PEF and the other contractor parties. The Group records a tax charge, with a corresponding increase in revenue, for the tax paid by EGPC on its behalf. PEF became profitable at the end of 2024, reversing the historic tax loss position since first production, and this led to a 1H 2025 tax charge of $1.1m (1H 2024: $nil).

One of the Group's companies entered into commodity zero cost collars designated as cash flow hedges. In accordance with IAS 12, a deferred tax asset has not been recognised in relation to historic hedging losses as it is unlikely that the UK tax group will generate sufficient taxable profit in the future, against which the deductible temporary differences can be utilised.

Net loss/profit

The post-tax loss for the period of $(2.8)m (1H 2024: $15.3m post-tax profit) included $(0.6)m of restructuring expenses, re-measurements and impairments (1H 2024: $12.6m) which are shown in the table below. Business performance post-tax loss for the period was $(2.2)m (1H 2024: $2.7m post-tax profit).

Restructuring expenses, re-measurements and impairments are comprised of the following:

* A non-GAAP measure of underlying net profit from operations, which takes out the impact of unusual, non-recurring transactions and the impact of non-cash re-measurements and impairments.

Balance Sheet

Impairments and Impairment Reversals

We have evaluated each of our oil and gas producing properties for impairment or impairment reversal triggers. The average Brent price forecast as at HY 2025 fell by only 6.8% for 2025 to 2027 and 4.6% in the longer-term and does not indicate a significant change in the underlying value of oil and gas assets. Furthermore, there were no significant changes to the weighted average cost of capital (WACC) and forecast production volumes for both Vietnam and Egypt assets compared to 2024 year end.

As a result, after examining both internal and external indicators of impairment, the Group determined that no impairments or impairment reversal indicators were identified on any of the Group's oil and gas producing properties and no impairment tests were considered necessary as at 30 June 2025.

As at 30 June 2025, the carrying amount of the TGT oil and gas producing property, after additions of $0.9m, increase in decommissioning asset of $0.7m and DD&A of $14.9m, is $140.3m (Jun 2024: $141.2m; Dec 2024: $153.6m). As at 30 June 2025, the carrying amount of the CNV oil and gas producing property, after additions of $0.5m, increase in decommissioning asset of $0.3m and DD&A of $4.2m, is $56.8m (Jun 2024: $59.9m; Dec 2024: $60.2m).

As at 30 June 2025, the carrying amount of the El Fayum oil and gas producing property, after additions of $0.7m, transfer from intangibles of $2.9m and DD&A of $2.6m, is $59.5m (Jun 2024: $62.0m; Dec 2024: $58.5m). As at 30 June 2025, the carrying amount of the NBS oil and gas producing property, after DD&A of $0.1m, is $1.0m (Jun 2024: $1.2m; Dec 2024: $1.1m).

Cash flow

Operating cash flow (before movements in working capital) was $33.5m (1H 2024: $50.9m). After tax charges of $15.9m (1H 2024: $16.2m), other/restructuring costs of $nil (1H 2024: $0.4m), working capital outflow of $1.6m (1H 2024: $6.6m outflow) and interest received of $0.1m (1H 2024: $0.2m), the cash generated from operations was $16.1m (1H 2024: $27.9m). This highlights the continuing strong operating performance from the producing fields in Vietnam and Egypt, despite 13% fall in Group realised oil price.

Cash generated from operations, after tax charges, exceptional expenses and working capital movements, is the basis of our dividend framework.

There was an increase in receivables of $5.0m for the period (1H 2024: decrease of $6.8m). $2.9m increase relates to Egypt trade receivables (2024: $3.4m decrease) following reduced recovery from EGPC during the first half of 2025. Vietnam trade and other receivables increased by $1.6m (2024: decrease of $3.3m), primarily linked to the timing of liftings (3 cargoes in June 2025 compared to 2 cargoes in December 2024). Inventory decreased by $5.0m (1H 2024: increase of $11.9m) and this was driven by Vietnam operations and the timing of liftings from TGT. Vietnam revenue volumes overall were up 14% compared to 1H 2024 and, combined with lower production and a reduced commodity price environment, this led to a reduction in inventory compared to the inventory build in 1H 2024. Trade and other payables were a cash outflow of $1.6m (1H 2024: $1.5m).

Share Buyback and Dividends

In January 2025, the third and final $3.0m tranche of the Company's share buyback programme initiated in July 2022 was completed. Although there is currently no active share buyback programme, the Board will keep the possibility of further buybacks under consideration as part of the Company's commitment to shareholder returns.

Pharos has a clear sustainable policy for regular dividend payments and this has been set at returning no less than 10% of Operating Cash Flow (OCF) each year in two tranches

-       An interim dividend payable in January of the following year; and

-       A final dividend payable in July of the following year.

An interim dividend of 0.363 pence per share in respect of the year ended 31 December 2024, $1.8m equivalent, was paid on 22 January 2025 to shareholders on the Company's register as at 20 December 2024.

A final dividend of 0.847 pence per share in respect of the year ended 31 December 2024, $4.7m equivalent, was approved by the shareholders at the Company's AGM in May 2025 and subsequently paid on 18 July 2025 to shareholders on the register at the close of business on 13 June 2025. This took the 2024 full year dividend to 1.21 pence per share.

The Board has resolved to pay an interim dividend of 0.3993 pence per share, $2.3m equivalent, in respect of the year ended 31 December 2025 and this will be paid on 21 January 2026 to shareholders on the Company's register as at 19 December 2025.

Liquidity risk management and going concern

The Group continuously monitors its business activities, financial position, cash flows and liquidity. Cash forecasts are regularly produced, and stress tested for several scenarios including a downturn in the oil price and adverse changes in production rates. Given the current rapidly changing global political and economic landscape, and fluctuations in oil price, inflation and interest rates, the scope of our scenario planning remains extensive. Accordingly, stress tests have been run for oil prices down to $45.2/bbl in September 2025, rising gradually over a year until in line with our base oil price curve, concurrent with reductions in Vietnam and Egypt production compared to our base case of 5%. As at 30 June 2025, the Group had a cash balance of $22.6m with improved liquidity and no debt. Forecasts show that the Group will have sufficient financial headroom for the period of 12 months from the date of approval of these half-year results. Based on this analysis, the Directors have a reasonable expectation that the Group has adequate resources to continue its operations in the foreseeable future. Therefore, they continue to adopt the going concern basis of accounting in preparing these half-year results.

Sue Rivett

Chief Financial Officer

Corporate Review

Environmental, Social, and Governance (ESG)

Pharos continues to prioritise sustainability in everything we do. We recognise the importance of environmental stewardship, social responsibility, and corporate governance in the energy industry, and continue to demonstrate our commitment to our Net Zero by 2050 target by managing our emissions across the portfolio.

In 1H 2025, the Group's Scope 1 and 2 emissions remained at the same level compared to the same time last year. The continuation of various emission-reduction projects to upgrade energy efficiency and reduce flaring in Vietnam, and the continuous usage of our diesel replacement gas generators in Egypt, were key drivers behind our stable emission level, which is a reduction compared to our 2021 baseline. Most recently, our field operations in Egypt are now connected to the national electrical grid, which further reduce the consumption of carbon-intensive fuel in our field operations.

We are proud of our social initiatives which have been an important part of Pharos since inception. For 1H 2025, the Company invested in 20 social and community projects, ranging from providing educational support for children with disabilities to supporting low-income communities. Pharos will continue to work closely with our local partners and joint ventures to ensure our social initiatives bring positive, sustainable impacts to host countries and the local communities.

On corporate governance, over the past few years, the Board has undergone leadership changes to maintain a high standard of governance. The Board is refreshed, resilient, and strong. Pharos will continue to have positive and regular engagements with shareholders and are grateful for their continued trust and support.

Principal and emerging risks and uncertainties for the second half of 2025

The Board continues to fulfil its role in risk oversight by developing policies and procedures around risks that are consistent with the organisation's strategy and risk appetite.

Pharos carried out an assessment of its principal and emerging risks at half year 2025. There has been no change in the principal and emerging risk from December 2024. The key principal and emerging risks are:

·      HSE & Social

·      Political and regional instability, including conflicts and ensuing sanctions

·      Risk of rising inflation and stagflation

·      Climate change

·      Commodity price volatility

·      Partners' alignment

·      Sub-optimal capital allocation

·      Cyber security

·      Reserves downgrades

·      Insufficient funds to meet commitments

Responsibility Statement

The Directors confirm that, to the best of their knowledge:

1.     The interim condensed consolidated set of financial statements immediately following this report has been prepared in accordance with United Kingdom adopted International Accounting Standard IAS 34 'Interim Financial Reporting' and gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

2.     The interim report includes a fair review of the information required by:

·      DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed consolidated set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

·      DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

On behalf of the Board:

Katherine Roe                                                                     Sue Rivett

Chief Executive Officer                                                      Chief Financial Officer

23 September 2025                                                           23 September 2025