Prospex Energy returns to profit in H1 2026 as European gas and power assets deliver higher revenues
Prospex Energy swung to a profit of £131,941 in the first half of 2026, reversing a loss of £180,101 from the same period a year earlier. The AIM-listed investment company credited the turnaround to stronger revenues from its Italian natural gas asset and its Spanish gas-to-power plant, alongside a £628,789 unrealized fair-value gain on financial assets.
That result marks a real shift in performance — European producing assets have been generating rising cash flows throughout the period.
Company swings to profit on stronger asset performance
The £131,941 profit for H1 2026 represents a swing of more than £312,000 year-on-year. For a company of Prospex’s size, that’s a meaningful reversal, and it reflects genuine operational improvement rather than a one-time accounting quirk — though, to be fair, that £628,789 unrealized fair-value gain on financial assets did contribute to the headline number.
Post-period, it was declared admissible, triggering a 60-day public observation period — procedural, but important for keeping the development timeline on track.
Net Asset Value climbed too. Shareholder equity rose by £363,519 to £23,303,440 at June 30, 2026, up from £22,939,921 at end-2025. Cash at the company level jumped sharply — from £38,935 at year-end 2025 to £524,643 by mid-2026 — partly reflecting the completion of a Convertible Loan Note issuance during the period.
Italian gas asset and Spanish power plant drive revenue growth
The two producing assets did the heavy lifting. At Selva Malvezzi in Italy’s Po Valley, the Podere Maiar-1 well delivered gross production of 14.28 MMscm. Prospex’s 37% interest translated to 5.28 MMscm net, sold at an average price of €0.46/scm and generating €2.41 million in net revenue.
In Spain, the El Romeral gas-to-power plant in Andalusia resumed electricity generation in January after a rental transformer was installed — a single upgrade with an outsized effect. Daily generation hours jumped from around four to sixteen. Combined with higher wholesale electricity prices in Spain, the plant delivered consistently rising revenue across the reporting period.
The Spanish operation has since hit a further milestone. Post-period, Tarba Energia — the El Romeral operator — reached cash self-sufficiency as of July 2026, meaning it no longer needs funding from Prospex to cover operating costs. That’s a significant shift in the financial relationship between the two companies.
Development pipeline advances in Italy and Poland
Progress wasn’t limited to production. At Selva Malvezzi, license operator Po Valley Energy filed an Environmental Impact Assessment with Italy’s Ministry of Environment and Energy Security in June, covering plans to drill, develop, and commission four new wells within the concession. Post-period, it was declared admissible, triggering a 60-day public observation period — procedural, but important for keeping the development timeline on track.
New 3D seismic data acquired at Selva Malvezzi is also being processed by Schlumberger Italy, with the goal of building a high-resolution subsurface model to support future development decisions. As of the report date, that work was nearing completion.
In Poland, Prospex’s wholly owned subsidiary PXEN Tatra was awarded two new exploration licenses — San and Dunajec. San targets shallow Miocene gas. Dunajec offers both Miocene gas potential and Jurassic prospectivity, and it includes an undeveloped oil discovery called Mniszow, for which a detailed development plan and economics presentation was released in September 2026.
Strategic partnerships and leadership changes reshape the company
The period brought significant changes at the top. Tom Reynolds was appointed CEO on February 1, 2026, replacing Mark Routh, and Simon Ashby-Rudd joined the board as Non-Executive Director in May. Reynolds quickly kicked off a full portfolio and strategy review, with initial findings presented at the company’s AGM in June.
The new management team also closed the Convertible Loan Note issuance that launched in late 2025. The raise brought in approximately £2 million — well above the original £1.6 million target — with £1.37 million received during the reporting period itself.
One of the more unusual developments was a strategic collaboration at El Romeral with IMMAGE, a scientific drilling project investigating Mediterranean-Atlantic geological history. IMMAGE will contribute up to US$1.5 million toward coring and logging operations in a subset of the planned wells, while Prospex gets access to geological data and research visibility at no additional cost. Post-period, a new 12-month gas supply agreement with Hera Trading was signed, effective October 1, 2026, supporting continued gas sales from Selva Malvezzi.
Financial position and outlook for the remainder of 2026
The profit picture wasn’t entirely clean. Administrative expenses rose by £250,352 to £881,156 in H1 2026, though management noted that £195,686 of that increase was non-recurring — covering management transition costs (£89,052), debt-raise fees (£69,155), and foreign exchange losses and timing differences (£37,479). With those one-off items behind the company, the cost base should look meaningfully different in the second half.
Trade and other receivables also increased, rising by £576,332 to £11,277,601, reflecting additional loans to investment companies and accrued interest, net of repayments.
Management confirmed the company and its investment vehicles have sufficient funds to meet operating and known capital costs. Reynolds outlined two priorities for H2 2026: maximizing net cash flow from producing assets and securing partnership investment to advance development plans. The Polish licenses, he noted, offer “blue sky potential” in a supportive regulatory environment — though that potential remains exploratory for now.
Bottom line: Prospex returned to profit in H1 2026 on the back of stronger Italian gas revenues, a recovering Spanish power plant, a successful fundraise, and a fair-value uplift on financial assets. Its development pipeline is advancing across three countries, costs are expected to normalize, and both producing assets are now generating cash without requiring company support.
Kelly is an experienced writer with 15 years of experience exploring the big stories that shape our world, from tech breakthroughs and space exploration to climate, energy, and the fascinating quirks of science. She has a talent for turning complex ideas into sharp, memorable insights that stay with readers long after they’ve finished reading.
