I wouldn't want it to go ballistic but debt/equity of 40% would be ok. Thus about another $30m could be healthy and would boost the Enterprise Value and indeed the MCap so long as the debt is used to sufficiently increase Earnings and Assets (if drilling Wells or laying more pipe for Bowleven and Power).
This is one for the stocks and shares ISA.
I am looking at this as a five year play and drip feeding small money in on a monthly basis...
No it won't at all Foo is a minority shareholder, I believe that the IIs that were allowed to buy in at 1.6p actually got the item 5 on the agenda removed. So spout on about dilution as long as you want because it's not going to happen without a shareholders vote
The question of the morning seems to be is VOG corrupt, well let's look at its chairman. Kevin foo's pay and extras, jest over $10,000 a week, Plus expenses, Plus royalties, Plus share options, Plus drilling contracts. This man has said on a number of occasions that we are all feeling the pain of where the share price is, Please give me some of his pain. Don't forget that this company is not even profitable yet. Is it corruption or is it what you can get away with??????.
Just want to throw my ore in on this one. VOG are likely to be making a few million quid by the middle of next year.
Vog has a gearing ratio of 4%!!. It now has a track record of debt payments to a lender.
I would suggest that VOG will be borrowing about 8.5% above LIBOR at most.
$2 million in EBIT would mean VOG could borrow $10m and have Interest Cover of x2.
I get 1mmscf equating to about $1.8m of Earnings so would suggest for every 1mmscf VOG could seek $10m in debt.
Debt is cheaper than equity and as Gaz du Cameroon like most "utilities" with steady predictable earnings have good visibility of future earnings to leverage with a healthy relationship with a lender...One which VOG are now building with their current $8m odd debt.
I think it was in the last presentation that VOG made it very clear how he was going to fund the 2 wells to be drilled next year , even at the AGM he said he wasnt consolidating to dilute again . any investor can call VOG and get the same answer , pity you cant send a post it sticker through the computer and stick it on some ppl forehead . sence2 kept saying it even when the CEO said we wasnt now we have mon3y at it ,
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