Steady buying in good chunks .Is news in the offing ?
Back in at 3.75p
Oil Heads for Record Run of Weekly Gains Amid Easing Supply Glut May 22, 2015 http://bloom.bg/1IO4GBj
RE: Re. Rebound
spike, Well, my understanding is that they are not going to make any big drilling till oil price recovers. so no capital expense in drilling perspective. if they drill then that will satisfy Apollo covenant. if not, do u believe Apollo is going to enforce the covenant/note... I don't think so. but I don't like the Yorkville notes too. But I believe all this already priced in sp
RE: Re. Rebound
Konangi - do you not read any of the financial statements? The Apollo notes are in breach of covenant but Caza have been given a waiver until September. It's highly likely in September that Caza will still be in breach and there is a risk Apolllo could call the notes in. Refinancing will be extremely difficult for Caza as the debt markets have significantly tightened - Caza could only gets notes at 12% when financing was easy. As for having $5million cash - it's not much comfort when short term payables, mostly for drilling are far in excess of this. Caza have a $5million working capital deficit and free cash flow is at best $1.5million per quarter - unless they can get cash they are likely to start missing payment dates for bills. As for no placing - it's already been done - Caza have taken $4million (or us it 5?) from Yorkville and that will be converted into equity - around 25% dilution at current share price and with this hanging over the SP is unlikely to rise much from here.
Apollo note debt is due only in 2017..IMO this is a long period for an AIM company..Also economy is improving in us and uk, so refinancing should not be an issue, if required later..imo, there is no immediate default risk as you mentioned
IF there is a rebound then I am sure we will see a good return on our investments. BUT the big issue is refinancing the fifty odd million dollars worth of debt, if we can't do that then we will be looking at a fire sale of assets and possibly liquidation of the company. Not trying to scare anyone, but we need to be realistic - if there's no refinancing, then Caza is simply not viable. IF we can refinance, then I believe the good times will return again here...
Datafeed and UK data supplied by NBTrader and Digital Look.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.