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'...Fundamentally greygeorge, you're a coward as you hide behind anonymity on here and constantly abuse people. Would you say what you say on here to someone's face, I very much doubt it ?!!...'
Lmao, I consider myself suitably admonished by someone who...calls themself 'clued', 🤣 and hangs out on a board full of anonymous posters who frequently posts conspiracy theories as and when the mood takes him. You're funny, 'clued' 🤣
Ah greygeorge, I expected you to post a nasty reply to my post, too tempting wasn't it !! I've been trying to profile you, but all I have are your repetitive nasty anti-social comments which indicate to me that you are a very bitter sad individual lashing out at the world. You are intelligent, but there's a lack of depth to your analyses. Hard to put an age on you, but I'd guess you're well over 40, thus your frustration at the way your life has gone so far and your feeling that you can't improve it. Your greygeorge user name backs up my view that you perceive your life to be 'grey' / overcast / depressing. Whatever you are, just remember 2 things: there's always someone else worse off than you AND you know very little about those you constantly criticise and abuse on these boards. Fundamentally greygeorge, you're a coward as you hide behind anonymity on here and constantly abuse people. Would you say what you say on here to someone's face, I very much doubt it ?!!
Notrex, you're correct I've already Bought enough within my portfolio, now I'm Holding.
I give the Strong Buy for those who haven't yet bought and for the AI !!
Hi pickedpeck ,
The CEO got the company in between a rock & a hard place. It was all of his own making.
Who demanded a USA listing him.
That same USA listing that meant he got the company trapped between what you can do on the LSE & what you can do in the USA.
He's the one who turned the buy-back on & off at his own whim.
If he had thought it through he could have solved the dividend/share buy-back issue when the yield on the stock got silly. Sadly he only got part of the answer at the very last minute.
What they could & should have done, was not listed in the USA, stopped the normal dividend payment & turned it into a special dividend & share consolidation each quarter. The dividend would either be frozen at that set amount (per share) for the rest of the year & would then increase by say 5% for year 2. All the saved dividend's would be used to fund a share buy-back program which activates if the share price is below X price. So the total cost of all this was exactly the same as the total cost of the dividend previously.
Anyone daft enough to be shorting the shares would soon feel the squeeze & leave the scene.
If anyone doesn't get it, then lets start of with the share price at 70p back then & 1 billion shares in issue & the dividend 3.5p for Q1. After the payout there are 950M shares in issue (3.5x20 =70p hence the 1/20 of the shares removed (50M).
Those who want to have the same amount of cash invested in the company need to buy additional shares on the market to return there holding to its previous level. They are also competing with the buyback program if the shares are below say 70p in Q2, 72.5p in Q3 & 75p in Q4. Market made aware of the trigger levels in advance for transparency.
Q2 dividend is 3.5p & share price is still 70p, This takes @ another 47.5M shares out of circulation + any buy-back ones.
Q3 divi 3.5p per share & share price 73.5p This takes out @43M shares + any BB & now just 859M max remain.
Q4 divi 3.5p per share & share price 73.5p thus another 41M + any BB ones are taken out. leaving 815M shares max.
The NAV per share has now increased considerably if it was £1.2 before its now £1.466 or plus 22%
If the share price is driven down at the ex-div date even more shares get taken out making it even worse for the shorters.
That's what they could & should have done but couldn't due to the CEO's USA vanity.
LOTM
Bod have read this all wrong!! Plus buybacks should be at 50,000 shares a day instead of a woeful 3,750 regular day drip!! If Rusty and his team don’t buck up then even US investors will pullout big style!! When will we know if the dividend is 30 US cents and when paid or if?? Come on Rusty boost the buybacks, get rid of the shorters and then take this share back to £15!!!!!
Pickledpeck: I'm not arguing about the award of option to execs - I accept it's pretty universal. However, what I am saying is that at a time of massive negative sentiment, an SP in the gutter and investors baying for blood - it was most definitely not the time to indulge themselves in the award of options which would have to be made public knowledge via RNS. That was just asking for gross negative sentiment to go even more negative - it wasn't rocket science to see that coming - their timing was crap and the utter lack of awareness beyond bewildering!! On that basis alone they deserve to be treated like pariahs. That's notwithstanding the multiple issues of lack of credibility caused by saying X and doing Y - or mostly doing bugger all (see Jim's post below).
I think both are fair comments except the timing is off. At the time of all but one of those announcements the share price had already dropped by around 50% or more, and the business operating environment had change considerably. The exec can't drop hints either, they have to either say something outright or not, no clues.
Where I think they could be held with feet to fire a bit is the US market listing hokey cokey, where we are, no we're not, yes we are confused a few.
Options are an interesting reward as they always come with an exercise price above the current one. They only become valuable if the share price far exceeds the option price. I know its weird but options are pretty universal as part of exec pay packages these days because they are a tax efficient way of incentivising company leaders. I've been given options in the last three companies I have worked for, only a small fraction of them ever landed cash in my pocket because of claw backs on leaving, rules on M&A etc despite solid performance. Options are seen by many as magic money beans that may never turn into anything at all so I don't go too hard on them in that regard.
Also as Joe Public exec pay exists in a different world, especially in the US. The payouts in share incentives seem large, but in terms of exec pay they are pretty small.
For example Ben Sullivan getting 9,600 shares, or about £100,000 seems ridiculous, but he will have had hard performance criteria written into his contract to get that. Also we should bear in mind graduates in US O&G companies start on over $100,000p.a. , a corporate lawyer earns probably a lot more than ten times that. No matter what you think about it as a shareholder it is what it is, that's the pay for that kind of character. I know I have hired some.
Pickledpeck: I'd actually agree with much of what you say - but not the comment regarding market sentiment. DEC put themselves in the position of being called liars by many by repeatedly saying they would never cut the dividend and then cutting it (whatever the reason - that's what happened) - it will be a very, very long time before folks forget that shafting. Had they been more transparent and prepared investors for what transpired to be a near 180 degree turn in the business model - the shock might not have been so severe. Furthermore, when the situation was then at its very worst DEC announce they are going to award themselves options - immediately seized upon (quite correctly) as 'reward for failure'. Now DEC had control over all the above (to a greater or less extent) and manifestly severely damaged 'sentiment' by their actions and/or inactions. This was the responsibility of the BoD - you can't cast off that blame to others.
P.S. Just seen what Jim has written - all correct and adds further weight to my post above.
PP - I’d argue that the BoD do have a significant impact on sentiment, which as you say, in turn impacts share price.
Repeatedly saying one thing then doing another does not improve sentiment:
- no more fund raises by dilution
- will keep the dividend at a fixed percentage of FCF
-will commence massive BBs
- will buy your shares at 105% if SP if you forgo the dividend.
All promised, none delivered. Hence the sentiment!
I know it is easy to blame to exec for the share price issue, but all they really control is the business operating performance. The share price is driven against other factors which the exec do not control, not least market sentiment which is obviously fickle in the extreme. Oil & Gas bad has been a recent narrative, so too stocks on the London Exchanges, so too has been any company with significant debt levels against high interest rates. DEC tacking all these boxes mean they were a sitting duck for the shorts.
I'd argue the operating performance in the environment they find themselves in has been better than just good, but you would have to find peer group companies to make the comparison with to be completely fair.
Pickledpeck: I also hear what you say - but the fact is that after a monumental crash since Aug 22 the SP is currently at 1,102p (as I type). It would seem that the pessimists have a very firm handle on DEC - and until good ole Rusty can show he's in control again (which IMO he currently isn't) then there would seem little cause for optimism. I will be buying no more DEC - just a hold and hope for me (and no longer a good dividend to keep me happy whilst I wait).
I thought you said you weren't buying any more Clued - only holding?
Pìckedpeck, AI with human oversight is the responsible way to use AI. AI is a tool, an assistant, but should not be the decision maker until its algorithms have been trained to that level of competence.
Diversified Energy IS THE BEST SHARE TO BUY AND HOLD.
Notrex,
I understand where you're coming from, but I can also see where Rusty was between a rock and a hard place. I the same circumstances I would likely have done the same thing, it is hard to see what else they could have done. Given they only have a certain amount of FCF deciding to utilise to protect future years by paying down debt is the right choice.
The issue with interest rates is that it normally drives long term commodity inflation. What happened here was that the two moved in opposite directions, at the same time as finance costs went through the roof gas (and wider commodities) prices fell off a cliff. One of my other main investments literally went bust because of this effect, so I know exactly what feeling burned is like.
I actually think against that backdrop the company performance has been pretty good, in fact exceptional regarding emissions and effectively closing down the Congress inquiry. Maintaining FCF is no easy trick, it isn't a given that DEC couldn't have made worse choices and disappeared completely.
Pickledpeck: That's a bit like saying the car is overall in very good condition - it's only the engine that's buggered.
Incidentally, it was also manifestly clear that good ole Rusty had no contingency plan in place for when interest rates rose - which they were always going to do sooner or later. If so - why be talking about 'never cutting the dividend' until the minute before he was forced to do so? Not a good look is it?
Clued, we are all here to make money, shorts and longs are taking risk to do so.
I really do object to AI driven shorts as you may tell. AIs are good at trends, not fundamentals. They analyse what they see as correlating factors inflexibly, humans can adjust correlations when circumstances change.
We are right now in the midst of AI vs human investment wars, the AIs have been given the big Guns of ii deposits so human insight and intuition is currently the losing side.
Whilst skiers posts are simplistic most of his content is more or less right. The earnings potential and discount to NAV here is very high and shouts loud to that human intuition, whilst the bots see spot gas price negative sentiment, a high risk factor and other indicators which lead them to sell us down.
Clued: Most of the extant shorts (exempt Adage - who really are in the money) initiated their positions around £10 to £11 or below. Consequently, they really aren't currently looking that healthy - albeit they have jointly contributed to the dire sentiment here - but that is primarily down to good ole Rusty and the car crash crew. But why should he care eh - he'll just award himself some more options to reward his manifest failure (see SP for definition of manifest failure).
https://www.fca.org.uk/markets/short-selling/notification-disclosure-net-short-positions
Notrex, that's a negative reading of very positive results. In fairness all the business indicators are strongly up, EBITDA in particular near doubling in three years is not marginally up.
The biggest negative in the result is that FCF is effectively flat despite all the other performance improvements, undoubtedly impacted by the rise in interest rates which is beyond company control. That limits the company's room for manoeuvre so a shift to paying down debt to improve FCF is definitely the right way to go in my view.
Pickedpeck, I would never lower myself to congratulate Shorters on making profits, certainly also not at my expense. Until they crystallise their gains they haven't really gained as recently they've been losing. I view them as leeches tbh.
I also bought at over £20, but won't buy more of DEC as have enough for that risk. I simply diversify more instead with the divs as that spreads the risk.
Pickledpeck: Well done for stating that which I was aware of - my point was to see if skiramp had any idea - as opposed to spouting his 'soundbite' ramps.
However, these improvements in the accounts have been known for some time - you yourself go back to 2021. But the SP has been falling consistently since 2022 (and that's putting it mildly!). Consequently, why should what are relatively marginal improvements in EBITA, Revenue and margins suddenly be a catalyst for dramatic improvement in SP. Particularly as FCF has (again as you note) been actually falling relative to the above?
We have a shed load of shorts who are clearly assuming DEC are heading south - albeit we have recently been making tiny improvements in SP. The savings consequent to the trashing of the dividend have not been (to date) spent of an aggressive BB campaign (it's currently pitiful). We won't know about repayment of debt for a while - but hopefully that will be a potential catalyst. However, given good ole Rusty's predilection for buying more and more wells I suspect that is where his focus will be - we'll see in due course I guess?
I doubt notrex is a shorter, just a long term holder who is burnt and negative about the experience. If you bought at 100p (£20) or above on the basis of income, then you have seen both income and asset value reduce dramatically. Bound to leave you pi55ed off.
Its interesting that it seems a lot of the asset value erosion, and consequently the demand to slash dividend, was driven by bot based shorters like Voleon. Forward selling 5% of the equity in a crashing gas market created its own momentum and narrative. Well played to the shorters, they made money.
The real question for Johnny come latelys is what next? The gas market looks set to recover, the shorts will have to fold at some point against the gas market reversal. So forgetting the slightly limp buy backs, 5% of the free float will have to be bought back by the shorters. In theory that should reverse the drop from 75-90 (£15-18) that the shorts precipitated.
Hello Axe - still playing solitaire I see!? LoL
NOTREX the SHORTER! - Continually goes on about how much he is down here, and then bashes the company and any poster every single day that remains positive about company!? Agenda folks - it all there!
Yep - SHORTER!
Also...
Net cash provided by operating activities
2023 : $ 410,132 2022 : $ 387,764 2021 : $ 320,182
But...
Free cash flow
2023 : $ 219,096 2022 : $ 217,727 2021 : $ 227,334
So cash generation from operations consistently up, but FCF not keeping pace due to increased interest payments, holding just about level.
Across the last 3 years the results for 2023 were obviously the strongest, with most indicators strongly up despite exceptional markets in 2022 and 2021.
I'm not a ramper, but I am also not irrationally negative either. In fairness to skier...
Adjusted EBITDA
2023 : $ 542,794 2022 : $ 502,954 2021 : $ 343,145
Revenue:
(Total revenue, inclusive of settled hedges)
2023 : $ 1,046,327 2022 : $ 1,023,547 2021 : $ 686,905
Gross margin
2023 : 52% 2022 : 49% 2021 : 50%