The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Company Website has been updated to reflect the share ownership as at 20th October rather than 6th October.
This is name, new position, old position, number of shares & percentage owned of the 94.692M in issue at that date, ( Although I'm not convinced its totally accurate)
Goldman Sachs collateral account 1 1 10,603,238 12.23 was (11.18%)
Newtyn Partners 2 2 8,816,666 9.29 was ( 9.26%)
Palliser Capital 3 3 7,431,767 7.83 was ( 7.80%)
Kite Lake Capital Management 4 4 7,163,629 7.55 was ( 7.52%)
Irenic Capital Management 5 6 6,136,349 6.47 was ( 6.50%)
Bank of New York Stocklending 6 5,991,078 6.31
Dimensional Fund Advisors 7 7 4,245,328 4.47 was ( 4.55%)
Vanguard Group 8 9 4,245,328 4.47 was ( 4.19%)
Bank of America Merrill Lynch 9 8 4,312,448 3.97 was ( 4.53%)
So we have a new name on the list Bank of New York Stocklending collateral account - No hiding what that account is all about going by its "STOCKLENDING" rather appropriate given how much stock is currently on loan to the 4 longs.
Madison Avenue Partners who were previously 5 6 6,233,034 6.55% have now left the building ( for now at least) - yet have not submitted any holding notice to say they are now below the 3% threshold.
Morgan Stanley don't show up on the list yet they only reached the initial threshold on 13th October 6,377,792 shares or 6.718569% & there has been no notice to say it's gone below 3% again.
-------------------------------- old stuff -------------------
Blackrock used to own 3.13% as of 8th Sept so they have clearly fallen below the 3% threshold since then, yet no notification of such has been issued to the company.
Centiva Capital who had acquired the voting rights to 3.01% of the company around the 22nd Sept don't show on the list & we know Bank of America have a far larger holding in the company's voting rights than is listed above, but the record seems to only show shares owned not actual voting rights.
LOTM
Hi Tren,
I think, it was a bit like going to the supermarket's today, clearly the offer price was much lower on one of the other exchanges ( we know about CHI-X & BATS from the buy-back notices, my broker might have access to other's as well I simply don't know & can only go by the price on offer). So that's why my broker bought the stock there & then the LSE was offering the best bid - hence why the sale trade went through that exchange. Then my next buy went thorough one of the other ones again at a lower price than the 1st time round ( probably because of the reduced size of it, ie 2,200 shares instead of 3,700).
If it wasn't for the stamp duty I could have done it several times over & banked over 1p a share !!!!
My purpose was to create volume because the buy-back needs volume, it achieved a little of that but not as much as I had hope for at the time.
LOTM
LOT-M,
Perhaps LSE could shed some light on share dealings, from your observation, that that they report is totally misleading.
Thanks for your posts.
LOTM.
I like that I like that a lot.
😁
I've had a fun morning so far !
I bought my 3,700 shares back that I sold for just under £1.6147 late last night (didn't appear on the LSE) for under that price at £1.613144 (yes it didn't show on the LSE).
I then sold 2,200 shares at £1.6221 which does show on the LSE.
To then buy back the 2,200 immediately for £1.610141 that again doesn't show on the LSE.
Yes they were way below the official price.
So I thought I'd move them around for virtually no cost to me to see if it would trigger some of the bots into action and it has :)
LOTM
As no-doubt some of you noticed Goldman Sachs put out another holding notice yesterday afternoon, showing that on Monday 30th October they now held 15.359965% of the company which was an increase of 1.17181% from Friday
There indirect interest decreased slightly from 10.97396% to 10.53099% which meant they acquired 1,524,832 shares in a day.
Now Monday's volume on the LSE was all of 123,611 shares and Capricorn accounted for 19,417 of that volume.
So there is a lot of buying going on out of sight by Goldman Sachs
LOTM
Sold my 3,700 shares late yesterday but it didn't go through the LSE this time at just under £1.615 so that was a net gain of £203.22 which only covers a fraction of my paper losses on those bought in the low £1.8's after the consolidation.
Still it gives me more to trade with until my special dividend finally gets paid !
At least Merrill started buying back shares earlier in the ay yesterday & 58K wasn't to bad all things considered, but would really like to se them step up the pace a bit more if they can.
LOTM
So Goldman Sach's acquired another 1.151602% of Capricorn (1,083,803 shares) between Thursday the 26th Oct & Friday 27th October, taking there holding to 14.18868% of the company.
Yet the total volume of shares traded on the LSE on those 2 days were just 114,924 shares on the 26th Oct & 247,323 shares on the 27th Oct. Which is all of 362,247 shares.
We know Capricorn acquired for the buy-back 22,762 on the 26th & 31,353 on the 27th Oct through the LSE. Which is a total of 54,115 shares.
So where did the other 775,671 shares come from ?
LOTM
The 3,700 trade shown as a sell at £1.5488 @ 14.49 is actually a limit order buy of mine. I had sold a small parcel last week of 3,500 at £1.6198
I'm still waiting on my dividend arriving by the way !
Hopefully Merrill's are getting a decent amount of stock today at these low prices for the buy-back, which would be lovely jubbly.
LOTM
Oil prices could soar to a record high of more than $150 a barrel if the war between Israel and Hamas leads to a repeat of the full-scale conflict.
if the price of oil goes up, should be good for us... right ?
So, its jam tomorrow.
Heard that somewhere before?
Let me think, finished.
Sorry the system limits the size of posts so I'm having to split this into 3 separate ones to get it all in. This is the start of it.
PART 1
Year End Prediction
30th June net cash position was $176M less the Roughly $100M special dividend that has now been paid.
Net receivables were $148M with $113M of it overdue.
2nd half capex in Egypt for development & production was put at $40 - $50M
G&A for the 2nd half I'm estimating as $30M weighted to Q3.
Share buy-back program $14M in the 2nd half (although I don't think it will be finished by year end).
Net interest payable on Egypt Loan $5M after allowing for interest receivable on Capricorn cash balances.
There is around $20.3M in the accounts due to be paid within 12 month's I'm guessing its payable around the end of the year / early Jan & is effectively offset by a matching cash balance, so all we'll see is a reduction in outstanding debt & a lower overall cash balance.
There is also $25M payable to Shell in Jan 2024.
The only other cash cost will be OPEX - I've calculate that at $13 per net boe. So on 6,000 bopd & 7,000 boed nat gas & 184 days that works out at $31.1M (1st half cost was $27.5M for comparison in the accounts)
Only other thing on the subtraction side is depletion of reserves, but that's an accounting number affecting the assets of the company not a cash number. The 1st half was down as $55.1M so I'll be using $60M as my number for this.
So total 2nd half cash expenditure is expected to be between $120.1M & $130.1M depending on the actual D&P number.
On the income side, I've estimated Brent oil to average $88 per barrel for the half & the discount for Egypt to be $2 per barrel taking it down to $86.
Thus oil income will be $95M (86 x 6000 x 184).
Working out the nat gas number is sadly more complex. Capricorn use a number of 5.6 to convert there gas to boe rather than the standard figure of 6. Which means it has a higher BTU number than 1055 per MCF. After much debate I've decided to price it at 6x$2.95 rather than 5.6x$2.95 although it doesn't really matter that much as the difference over the 6 months is only $1.5M
So nat gas income will be @ $22.75M
This gives us a total income on paper of $117.75M
I say on paper because although its earned in the current half year, payments are always in arrears. So for Oil production in Oct the cash isn't actually due to be paid until 1st Dec & Gas not until the following month. So the easiest way to think about it is payment being a quarter behind actual production.
So the 2nd half would normal get the income earned in Q2 & Q3 which in this case means the lowest oil prices for the year so far in May & June being in the calculation from a cash received perspective.
Bearing this in mind I'm going to use an overall number of $100M from the cash side of things with regard to income.
PART 2
The next important question that needs to be addressed regards the overdue amounts, has this got worse/better/or stayed the same from what happened in the 1st half of the year.
I don't think they will have improved yet, so I've gone with a similar deterioration to that of the 1st half, ie a $50M increase in both net receivables & overdue amounts. Offset by a $20M increase in payables (the figures were $51M, $47M & $21M in the half year accounts). So effectively a further $30M deterioration.
Now to put it all together............
Cash of $76M + income in cash of $70M ($100M - $30M) = $146M
Less expenditure of between $120.1M to $130.1M
Leaving us with a net cash balance of between $15.9M & $25.9M
Plus net receivables of $215.75M ($148M + $50M + $17.75M) with $163M of it overdue ($113M + $50M) & net payables of $56M ($36M + $20M)
Now there is a scenario on these numbers where the company doesn't have the physical cash to pay the $25M to Shell in Jan 2024 although there should be payments coming into us on 1st of Jan (or close to then) of over $20M which would alleviate the problem. However that scenario only exists if Capricorn hasn't taken mitigating action before then like reducing the D&P spend / suspending the rest of what's left of the buy-back for a few weeks etc, or borrowing $15M max for 3 month's.
I'm sure they will take the appropriate action as needs be because Cheiron & Capricorn will simply not let the outstanding balances continue to build up without reducing there D&P spend or pushed it back until cash is coming in to match it, as its not in there interests to do so especially with Cherion being the largest Independent O&G in Egypt with many more licences than ours to deal with (fund) as well.
Our G&A expenses will be down to just $2M a month max by then as well & there will be a large incoming payment from Waldorf before April to make the cash bank balances look very rosy again.
Having dealt with the potential downside lets look at the upside of where things are.
I've used the max expenditure numbers in these calculations but I've not done so on the revenue side, oil production by late December should be nearer 7,000 bopd rather than the 6,000 I've used for example.
So our net position at the end of June was $186M ($76M cash + $112M net receivables [$148M - $36M of payables] ) of near liquid assets.
At the end of December we're looking at near liquid assets of between $175.65M & $185.65M ( with a minimum of $15.9M to $25.9M of it in cash + $159.75M net receivables [$215.75M - $56M of payables] ) Now obviously it would be preferable for the cash figure to be higher & the net receivables number lower by the corresponding amount.
PART 3
In other words we're literally back to where we were at the end of June, only having spent another $40 - 50M on D&P that has increased our production rates ahead of 2024, $14M on the share buy-back & a large chunk of the $30M on G&A right sizing the business for the future.
Which makes for a very bright outlook for 2024, even if we were to ignore the Waldorf payment completely.
We'll have higher production & lower G&A costs, & as some of those net receivables get paid to us, they'll be a lot of room for dividend payments.
In Q1 of 2024 Expense's for example will come to around $64.5M ($25M Shell, $15M D&P, $15.5M OPEX, $6M G&A, $3M Debt Int).
Yet using 7,000 bopd & 6,000 boe of nat gas, revenue will come to $65.5M ( $54.75M Oil, $9.75M gas) using the same average prices of $86 for Egypt oil & $2.95 for gas.
Now you're saying where's the spare cash for ordinary dividends on those numbers !
Well in Q2 Expense's will drop to $43.5M ($20M D&P, $15.5M OPEX, $5M G&A, $3M Debt Int) & that's with increasing D&P by another $5M for the quarter. While income should actually increase due to production increases from the cash invested in Q1, but even leaving it unchanged we'll be $22.5M better off, meaning that Capricorn should be able to pay an interim dividend in Sept/Oct of around $15M easily. Translating that into a per-share number depends on what happens to the Waldorf payment & whether that was used to give us another special dividend & share consolidation before then. If it was then we'd be looking at around $0.20 per share for the interim dividend rather than say $0.15
As for the final dividend for 2024, well that would all depend on what the oil price does during the year, but if it did average out at a price similar to this year's then I wouldn't be surprised to see $30M being paid out ie potentially $0.40 per share (in May 2025) & $0.60 in total in ordinary dividends for the year to 31st Dec 2024 & that's just the beginning of these significant payouts.
The potential 2025 payment's from Waldorf & Woodside ahead of that final dividend announcement could have a significant bearing on the per share amount's. It will depend on the share price at that time as to how many shares would be cancelled from another consolidation, but I can see the potential for Capricorn to have just 55M shares in issue by then (90.55M end of 2023 to 75M in 2024), thus the final dividend payout would be around $0.55 per share instead of $0.40 which is a massive difference.
LOTM
Capricorn must have one of the most active major shareholder registers out there !
Morgan Stanley have now joined the party.
I wonder how they got 6.3M shares so fast, given how little volume is trading through the LSE.
LOTM
I'm not entirely sure how they are doing it but Goldman Sach's continues to increase its voting interest in Capricorn week by week.
There overall ownership of shares has decreased yet again, but at the same time they've increased the indirect voting rights by an even bigger number.
Split has gone from 2.343998% of shares owned down to 2.067665% & indirect interest up from 10.437694% to 10.940662%
Which is an overall rise from 12.781692% to 13.008327%.
So that is an overall increase of 1% since the share consolidation on 6th October
-------------------------------------
So the current know longs are
Goldman Sach's 10.94662% (24th Oct)
Bank of America Merrill Lynch 10.187023% (5th Sept)
Centiva Capital, LP - 3.05% (22nd Sept)
Palliser Capital (UK) Ltd 2.35% (10th Oct)
Which is a total of over 26.5%
The other 6 major institutional investors only own 38.57% of the company's shares !
Therefore on the face of it at least 4 of them have "lent out" there Capricorn voting rights.
I don't think there can be many similar situations out there if at all.
Which is why they can move the share price around to there hearts content to flush out weak holders & get stock on the cheap, even with the buy-back acting in competition to them.
LOTM
I'm busy doing some calculations as to my end of year numbers regarding cash / net receivables due / over due amount etc & I'll publish them in due course
Hopefully the 30th Nov update on Egypt will provide some of the actual figures to the end of Oct, so that we can see the trends.
I believe we are currently getting net revenue from oil & liquids of $362,000 per day ( after OPEX costs & putting G&A costs at $100K per day [$3M a month] ) using 6,000 bopd.
I estimate depletion costs to be around $126,000 per day but that's money already invested, so isn't a cash figure but still needs to used to reduce the outstanding value of the assets accordingly in my calculations of true value.
Now that $362,000 per day won't be coming to us anytime soon. Its not due for payment until 1st December & it won't fall into the overdue category until at least 1st Jan 2024. I'm guessing it will be after 1st April before Capricorn gets its hands on it.
Still its a significant sum of money & if oil prices average the same to the end of the year it equates to over $27M net in just 75 days.
LOTM
Hi Bigbas2all,
I'm glad to hear you've got your dividend :)
I'm sadly still waiting on mine :( otherwise it would have been re-invested by now !
Good luck to you to.
LOTM.
Just a wee update I have my dividend,
Paid in on 20th.
Will buy back, when the right price for me in the grove. Best of luck to you all.
B
From Woodside today
""At Sangomar in Senegal, another two of the 23 planned wells were drilled, taking the total now completed to 14. Pre-commissioning work at the floating production storage and offloading vessel continued in Singapore. Overall, the Sangomar project is 90% complete and we remain on track for targeted first oil in mid-2024."
"Sangomar Field Development Phase 1
· FPSO topsides integration and pre-commissioning works continued in Singapore.
· The development drilling program continued with 14 of 23 wells completed.
· The subsea installation campaign was 80% complete, with the overall subsea work scope 96% complete at the end of the period.
· The project was 90% complete at the end of the period and first oil is targeted for mid-2024."
LOTM
Hat's of to you Mr.kioto,
You've called the share price movement far better than me.
LOTM
Tomorrow is payday gents! dont spend it all in one place!
So far they've bought in just over 0.50% of the stock in 9 days (478,044 shares) & spent £834,105 doing so at an average price of £1.7488
That works out at just over 10% of the $10M having been spent thus far.
My model show's that at the current average price to date (£1.75) they will get to buy-in a further 4.11M shares. If it averages £1.70 from now on it will be another 4.23M instead.
The strength of the $ against the £ is also aiding the cause. I'm using $1.25 to be on the high side & thus understate the total number of shares they actually purchase.
So the total buy-in is currently headed for just over 5% of the company & at the same time its substantially adding to the NAV of the remaining shares.
Hopefully they shake out a lot of stock & get volume up so the company can munch away at these prices. As its hard to see them completing the buy-back by the end of 2023 currently.
Hopefully this sort of price is still available by the time my dividend arrives ( I'm guessing Monday at best knowing my broker, but they messed it up the last time & it took 2 weeks to get it)
LOTM
Bigbas2all,
No problem :)
You're last post made me go & look at something in more detail .......... the trades themselves.
https://www.rns-pdf.londonstockexchange.com/rns/6658P_1-2023-10-10.pdf
Is a good one to view, what it tell's us is that the buy-back trades are all marked AT on the LSE, Merrill Lynch are not usually the 1st trade in a sequence of trades all with the same time stamp, only part of the bunch turns out to be for the buy-back & they are literally all on the sell side register.
So anything with an O isn't them, nor is anything on the buy side either, which means I now know what to look for much more clearly from now on :)
So the AT buy's are likely to be the insto's who are trying to build-up there positions like Goldman Sach's etc. Trying to make hay while they can.
There was hardly an O trade today, I think 20 in total Bigbas2all inside normal trading hours & the largest of those was a 2,000 buy with only 3 other trades above 1,000 shares in size. So virtually no PI involvement/interest.
LOTM
LOTM
Thanks for the feedback, strange that the day I ask the question, there are large amounts being bought.
Just a thought. 👍