Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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9%´ : They will first reach 10%, Then could do the same as DNO (EGM was on the 28/2!) call an EGM to cancel these 10%. IF a dividend of 50 mio$ is paid, you will see an increase in the yield. Then at the AGM, they will request the buyback of another 10%. Buying back at current price levels it is the most profitable investment.
´there would be a paper loss of up to $50m’: Not if we have some good news that push up the price.
Their biggest problem is the oil price. What happens if the oil price returns to the 30$/bl?
Another point: if the market cap keeps going down, there is a risk that they drop out of the MSCI Emerging Small Cap Index and other benchmarks, which is not good. Perhaps a good reason to take care of the price and push it up.
apologies for multiple posts.....seems to be a delayed input
maybe they're building a majority shareholding in readiness for a lowball offer....after all it could be justified when we're not getting paid!?!?!?
maybe they're building a majority shareholding in readiness for a lowball offer....after all it could be justified when we're not getting paid!?!?!?
HI hi - think we are agreed on that.
The purpose of the buybacks is purely selfish, and nothing to do with us as annoying, but impotent and irrelevant PIs.
I'll make some predictions:
A) A further campaign will follow when this 25m scheme is filled.
B) It will be decided that the stagnant buyback shares WILL attract full dividends after all.
C) They care not a jot about paying off our current debt -why on earth should they ? - nothing in that for them after all.
D) There will be something in it for the major shareholders for allowing this travesty (and successive) campaigns to continue.
Hope I'm proven wildly wrong on any of the above.
This useless, self serving, lying Bod should be getting rid of the debt instead of this fruitless buyback hairbrain scheme.
Hi BD,
Staff share options aside, if GKP did cancel the unrequired shares at the AGM, there would be a paper loss of up to $50m.
But that’s it imo.
Everything else is already accounted for in the figures, primarily up to the $50m cash paid for that stock sat in treasury.
And in fact there may well be an argument for creating a ‘Goodwill’ element in the Balance Sheet under ‘Intangible Assets’ to literally balance the books.
Either way the cancellation of treasury shares should have had no practical impact on the Company whatsoever except to concentrate shareholder value as and when the new share base at c.a.210m shares is recognised for what it is.
But taking out 9% of the stock for good at a single stroke…what would that do for the share price?
Given the basic economic theories of Supply and Demand that’s anyone’s guess. It’s definitely not a bad thing.
Anyway, I see the buyback as one means for the Board to start ‘taking back control’ to use an overworked Brexit phrase,
and as such I welcome any further buyback initiatives, but to cancel preferably.
All imo.
Hi Straycat,
‘The Company will make further announcements in due course following the completion of any further purchases pursuant to the Programme.’
Another announcement could perhaps be increase the buyback to 10%. At the AGM request the cancellation of the treasury shares and request authorization to buyback another 10%. Will they pay a dividend ?
´Gabriel Papineau-Legris was in Oslo (Pareto) this morning’ -> WHO and WHY NOW?
Bondholders ?
Have perhaps plans to raise money for gas investments?
Perhaps NOW, because their buyback should stop when they publish year-end results and explain their gas investments.
Tom hinted about an understanding on payment conditions. You don’t see anything on the other Kurdish oil stocks, except DNO today.
On 21/1/2020 the OpUp stated that cash was at $192m.
Since that time GKP have bought another $10m worth of shares leaving the cash balance (inc. other operational disbursements) at c.a. $180m.
GKP are owed for shipments since October 1st 2019. This will be in the order of $90m.
That’s $270m or so either with us or awaiting payment (we should chase up payment for October invoices as a matter of priority, Ian Weatherdon note).
So today we’re valued at little more than our cash and cash receivables.
As a consequence no value is conferred on our operational assets whatsoever.
And it’s been broadly the same story ever since the Restructure in 2016.
Ignoring the absurdity of that proposition, and bearing in mind the declared production uplifts already achieved to 42k bopd with the imminent move to 55k bopd and then beyond, the burning question for the Board is what to do about it?
Both JF and JH are probably pretty p1ssed off about this treatment and it may be that the buyback policy is their tangible response.
Forget about what they’ve said and look at what they’ve already done.
The shares are being driven off the market on a daily basis, at discounted prices, sitting in treasury and unavailable for general market trading.
As of last night GKP had spent $46m buying back 16.4m shares into treasury. By the end of this final Programme phase they will have spent $50m on c.a.19m shares, or just over 8% of the issued stock.
This is a tangible expression by the Board of their belief in the future of GKP right now just as the Markets are looking the other way.
And they may not have finished yet. Every night, in every Repurchase RNS, we are reminded that:-
‘The Company will make further announcements in due course following the completion of any further purchases pursuant to the Programme.’
Certainly the cash flow forecasts suggest that, just as in the last eight months, further funds can be allocated to buyback without disrupting either the dividend payments or the ongoing capex developments beyond 55k bopd.
So bring it on GKP, there’ll be another request for buyback authority at or before the AGM imo, and it can’t come soon enough for me.
At the current rate of repurchase we could have another 15-20m cheap shares off the market by the end of this year. That amounts to some 15%-20% of the issued stock.
And if that doesn’t do it, and as long as it doesn’t impinge upon either the dividend pay outs or the capex funding, the Company should just keep on buying until the realisation finally dawns imo.
Then we’ll see what the true value of GKP is.
It may be a slow burn (unlike cancellation) but it will eventually take us to the same place.