The Oil Gusher 2Q1H26 E&P Playbook Part II The summer of Ithaca

The Oil Gusher 2Q/1H26 E&P Playbook Part II: The summer of Ithaca Price Objective Change

14 August 2026 Key takeaways Equity • Ithaca 2Q26 results fast approaching (August 19th); we view the event as an imminent Pan-Euro catalyst with >20% upside to FY26 DPS Oils • Elsewhere, we continue to see beats outnumbering misses but highlight rare Cian Evans-Cowie >> idiosyncratic upside at Buy-rated ENOG Research Analyst MLI (UK) • We reiterate our sector preference for quality > beta. Ithaca is our top E&P pick Christopher Kuplent >> Catalyst calendar: Ithaca 2Q26 results next week Research Analyst MLI (UK) Ithaca is set to report 2Q26 results next week (August 19th). We think this will be the one to watch this earnings season. We expect a continuation of the theme of shareholder payout upgrades under Eni ownership (N.B. Eni owns ~36%/63% of ITH/VAR) following Matthew Smith >> Research Analyst Var Energi’s quarterly dividend raise from $300m to $350m with 2Q results, and Eni’s MLI (UK) own buyback guidance bump. Given Ithaca’s explicit cash-flow linked payout policy we continue to see upside to both consensus (>20%) and existing FY26 guidance (~20%). Why get excited now? Under the company’s payout policy, we expect 50% of the FY dividend to be announced with 2Q results offering an imminent rerating opportunity for Jargon buster: the shares (see page 3). Ithaca Energy is our top pick among European E&Ps- Buy. Boe: barrels of oil equivalent 2Q26 / 1H26 E&P Playbook: cue the beat Bbl: barrel We continue to see beats outnumbering misses this earnings season. Our aggregate earnings sit 5% ahead of consensus for those yet to report, while our CFFO estimates MWh: megawatt hour outsize those of consensus by >10% (see Exhibit 9 and Exhibit 10). In our view, most of Kboepd: thousand barrels of oil the upside can be explained by higher realised prices. Dated Brent (a better proxy for equivalent per day physical sales) has been trading at the highest premium to month-ahead Brent in recent history (see Exhibit 7), while consensus has been slow to move. That said, we feel there is rare outsized idiosyncratic upside to be had at Buy-rated Energean. We forecast CFFO >30% above consensus, reflecting what we think is an overreaction to the reported shutdown of production in Israel earlier this year (see page 11 for more on ENOG).

Early report card: suspicions confirmed So far this earnings season cash flow beats have outpaced earnings with companies delivering average CFFO beats of +5% vs. average -4% misses on EBITDA (although mostly attributable to Serica). Excluding Tullow (full 1H26 results are yet to be reported) the greatest share price moves QTD belong to Var Energi and Harbour where payout run rates were boosted. In our view, this is positive for Ithaca. However, looking at YTD performance, we find high oil-beta stocks most disconnected from fundamentals (see Exhibit 6). Furthermore, with Brent currently trading at >$85/bbl we still see risk/reward skewed to the downside and so prefer quality from here. Following Tullow’s trading update we revise our numbers slightly (mainly in-year timing and working capital – EBITDAX <1%) with our PO up to 6.4p from 5.7p previously.

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Contents Catalyst calendar: Ithaca 2Q26 3 1H26 playbook 5 Company previews 8 Ithaca Energy – August 19th 9 EnQuest – September 3rd 10 Energean – September 9th 11 Tullow – September 28th 12 Half-time report card 13 Aker BP 2Q26 digest 14 Var Energi 2Q26…