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Short write up on the DGOC webinar available here
https://www.yellowstoneadvisory.com/post/diversified-gas-oil-clear-strategy-consistent-execution-strong-financial-results
What a great company and leadership team. With a focus on low cost, high margin and rewarding shareholders, what's not to like?
Some good hints for the year to come. They are looking for a Market Cap of 2 billion. We can expect some large investments. A mention of a stable SP so I guess they will do a RI to raise some capital.
Yellow - Thanks for link, very informative. Rusty explaining the hedging strategy makes much more sense than the text in the Final Results. Given uncertainty over natural resource pricing over last few years and next few years, it seems a sensible strategy to minimise downside risk - even if it might reduce profit in good years. 90 % hedging for this year and 60% for next year already should ensure dividend security. Lack of Capex and strategy of recycling / improving efficiency of old wells looks like a simple success as long as reserves hold up.
I've been a holder for several years, topping up whenever price below £1 - often tempted to sell at over £1.20 but liking the increasing dividend so still here. Think massive share price rise unlikely as it looks like an Oil company to the uninitiated but happy at 9% return.
Very interesting presentation from management last night at their FY results webinar. The strategy is presented very clearly and they are executing on it brilliantly. Watch the recording here. https://youtu.be/tXHGxjUcE0g
There's a webinar with the mgmt team who will present the FY results this evening at 6pm. Register https://us02web.zoom.us/webinar/register/7216117313646/WN_u6UZAWCXTXaT_8uqF9rPEg
I'm happy to continue picking up dividends here bought my first tranche years ago at 80p and my second batch when the SP fell off a cliff in March last year, but you can't help but feel this share is missing much love from the market, the board might even remove themselves from the LSE to go stateside. It has been said on here recently but the hedging the company does is some of the best in the industry. Would a marketing campaign help or is this just the peak now due to the falling popularity of oil (even though we all know this is a gas company and no amount of electric cars are going to heat homes in the USA). Anyways just some cobbled together musings over what was a decent set of results.
Reliably makes money and looks like it will continue to reliably make money.
One for those of the 'Profits are an Opinion, Cash is a Fact' mindset - 2020 shareholder distributions $115m
Company strategy in a nutshell -
"Protecting our cash flow and its payment of dividends and debt will always be paramount. While hedging may, at times, cause us to forgo upside to commodity prices, we believe our shareholders and lenders value the high visibility into our distributions that hedging affords us."
£DGOC has reported another set of strong results this morning in their FY update providing more evidence that there is an excellent management team in charge. In a nutshell they manage wells (99% gas) more efficiently than industry peers ensuring they last longer and produce at lower cost. On the revenue front they employ a conservative hedging policy to reduce risk from commodity price volatility. This translates into better financial metrics
FY results this morning report Adjusted EBitda of $301m +10% and EBITDA margin 54% . December exit rate production increased to 103 MBOEPD +8% on December year and overall average production was up 18% at 100 MBOEPD.
The company policy is to distribute 40% of FCF to shareholders and today they have announced the Q4 dividend of 4 cents, taking the overall dividend to 15.25 cents, an increase of +10% over the year.
The balance sheet is in good shape with Net Debt of $725m, equivalent to 2.2x ND/EBITDA.
Management will discuss these results at a webinar on 10 March at 6pm Register here
https://us02web.zoom.us/webinar/register/7216117313646/WN_u6UZAWCXTXaT_8uqF9rPEg
Should be interesting.
DGOC deserves more credit than it has been getting. Hopefully that is about to change.