Harbour Energy

Harbour Energy Dividend Analysis and Summary

• Final dividend (FY2025): 8.05 cents per voting ordinary share (paid in GBP at spot on record date), subject to AGM approval.
• Ex-dividend date: 09/04/2026
• Record date: 10/04/2026
• Payment date: 20/05/2026
• AGM approval: 07/05/2026
• Dividend Reinvestment Plan (DRIP): available; election deadline 28/04/2026
• Distribution policy: new payout framework targeting 45–75% of free cash flow (FCF), with an initial base dividend of 16.10 cents per voting ordinary share (c.$300m total). Payout skewed to the lower end while leverage is >1.0x.
• 2025 distributions: dividends of $455m (interim 13.19c + proposed final 8.05c) plus $100m buyback = $478m (~45% FCF payout). 2025 FCF was $1.07bn.

• Coverage: 2025 FCF of $1.07bn covered cash dividends of $455m ~2.3x. The proposed final dividend alone ($150m) is well covered.
• Near-term outlook: 2026 FCF guided at ~$0.6bn (at $65/bbl Brent and $11/mscf European gas). The base dividend (~$300m) would be ~50% of guided FCF, aligning with paying toward the low end while leverage is above 1.0x.
• Balance sheet and policy: Net debt rose to $7.2bn post-LLOG; leverage expected to be slightly >1.0x at YE 2026. Management prioritises deleveraging, limiting additional dividends/buybacks near term beyond the base.
• Medium-term growth: Production expected at 475–500 kboepd through 2030; FCF expected to rise to ~$1.0bn in 2028 as higher-margin US Gulf volumes and UK tax synergies (Waldorf) come through. Once leverage <1.0x, payout could move toward the upper end of 45–75%, supporting potential dividend growth.
• Hedging support: For 2026, ~40% of oil hedged at ~$71/bbl and ~50% of European gas at ~$11/mscf, which underpins base dividend resilience.