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Pay close attention to the deliberate failure to release the reserves update carried out by Miller and Lents. This was promised for early third quarter (July). The Russian board have either cancelled the report or have it in their possession. This a critical indicator of the Russian boards intentions. This company is all about huge reserves, the last of the big reserve independents available to takeover. If we assume the 2P reserves are over 600 million barrels, the Russians will be looking to take these reserves for less than a dollar a barrel. The strategy is simple - how to do we get the last of the independent big reserve fields for a pittance. Their actions and behaviour will all be aimed at achieving this goal.
Because they are not doing anything against the rules. The behaviour of the board over the last six months demonstrates their intentions. They maintain complete silence, have no plans to develop the reserves and are currently putting production into reverse. They don't care about the share price as they consider the company already theirs. There is absolutely no legitimate reason to not have released the reserves update 4 weeks ago as promised by the last board. The last update was bare bones under duress. A takeover will come from khotin at some point, but it will be at time that suits him, at a price that gives him a bargain.
Gambier, I read some articles about Mr. Khotin and Mr. Klyachin have a past experience in collaborating over hostile take-overs of factories in Russia. It makes me really concerned, especially after what you wrote about Khotin`s intentions in Exillon. Why doesn’t the British Take Over Panel do something about it?
Hi Gambier. Any thoughts on the above. On the face of it they look good albeit revenue has declined they say due to mix with more being sold domestically at lower average prices???.Cash position is strong but no forward guidance on direction or drilling program?
Gambier is right and IMO we are being set up for a low ball bid any time soon
It is a consequence of them having no interest in developing the company. 2014 has essentially been a lost year for Exillon Energy. From last years drilling results it would have been very easy to have production to around 21k per day by now and with the great dollar exchange it would have been low cost to do so. Further drilling in H2 could have easily brought production to around 25k. Where is the reserves report that was completed by Miller and Lents in June? Why is the board preventing its publication?
The current share price values the company at $253m. Their profits are up 200% because they're not spending much now their exploration drilling appears to have been stopped. With their current sales it won't be long before they have more cash in the bank than the companies worth! How does that work then?
They don't want to develop the company through a stock market listing , that is very obvious. They want to acquire the reserves for their own preexisting oil companies. To try and predict the actions of Russian oligarchs is often futile. Khotin will want to obtain the rest of the share issue for much less than the price he paid for his original stake. He will do this in his own time and when it is financially convenient for him. It will be interesting to see how far they let the flows rates run down, as they have no interest in drilling. The company is now paralysed and minority shareholders are subjugated. There is very little in the LSE small cap rule book that can stop khotin doing as he pleases. I would not expect the ii to do very much, the company is not large enough for them to care.
What are the institutional investors doing here. Surely they should be jumping up and down demanding more meaningful info. When are the reserves data due out? I cannot believe that the main owners are not milking the business in some way to extract a return for them with no regard for the minority shareholders but what can we do!!! Lets hope that some kind of meaningful offer is made by Khotin et al so we can all move on soon.
Another pointless monthly production report demonstrating natural well decline. Do the Russians actually think by providing a consistent monthly issue of meaningless information they can make investors feel informed? Maybe they think they are creating the illusion of an active board working hard to push the company forward.
It is obvious the board has no interest in whether people invest in Exi or not. They show no regard for the reputation of the company nor the view of the market. They are very happy for this company to slowly become invisible. The half year report will be a master class in minimalism.
Maybe the continuation of the steady climb from 140 over the last few months. Still low volumes so I wouldnt read anything into it. Without an offer for the company on the table it will be interesting to see how the market values EXI, that is what it will stabilise at - 170p 180p ??? The clock is ticking for the board, three weeks left before they are mandated to provided some details on the company, as much they dislike doing this. Maybe we should request that exi has it's name changed to 'Exillon Energy?'
This month EXI will be forced to provide the H1 results, of course without any drilling, it is simple booking keeping to be reported. Reserves update should also be revealed this month. One must assume that both major shareholders are working together otherwise the silence would not have been sustained for so long. The pension funds appear to have no real interest in rocking the boat. Gazprom bank will want their money back at some point. My prediction is that the silence will continue with no more than is legally required being reported. I expect no drilling this year and would be surprised at any mention of 2015 drilling campaigns. I would then expect a randomly announced takeover sometime this year that will be significantly below the 375p Khotin payed. With a good reserves upgrade he might offer 280p. A very low offers seems pointless because Lukoil or similar could easily offer slightly more and start a bidding problem. I think a price that his board can accept without generating problems through minority shareholder rights is what will be offered. This may well be 240p. Of course this values all the reserves at non producing levels and rights off money spent on infrastructure. But this is Russia and reputations for honesty and integrity mean very little.
Agree. The oil is there and the price is high, why not make hay while the sun shines and get drilling.
Why report the production for every month? Without additional wells the existing well decline is pretty stable, we are learning nothing new, this information is just filler. Even after we are provided with a net profit figure and cash balance for H1, that is just book keeping. Why are the institutional investors not asking questions about strategy and drilling campaigns?
yes, its the impact of whats going on there . no fundamental change to EXi and so should come back when things settle down. Not sure how this will all play out but assume that Putin will step back as not to do so would be a disaster for Russia in the medium term and his own people will not satnd for it as gambier01 pointed out.
Yet again we see the share price fall as fearful investors outweigh the brave ones. Well, perhaps not brave just a bit more trusting. This latest price fall is just another chance to pick up some cheap shares but I'd wait a few more days until the government supported anti Russian campaign comes to a close. By the way, I'm not Russian, just glad Britain doesn't have any squabbling neighbours to deal with at the moment.
Gamblier01, vgas is very similar to exi.
It would appear that Ukrainian rebels armed by the Russian government have carried out this act. I would assume they were trying to shoot down a military plane but through utter incompetence have shot down a civilian airliner. Putin has to take responsibility in my mind, he may not have put in a order in to carry out the attack , but if you give a group of mindless thugs that sort of weaponry then you set the fuse. The Russians have been goaded by the West on the Ukraine issue for years. The provocation has been completely ignored by the Western press as it doesn't suit their narrative - Russia evil / America good. This is the problem with Russian investments, you have a country that still feels the need to project power through the military instead of economic development. Russia has a lot of talent going to waste, one can only dream that Gary Kasparov would gain power and all this sort of conflict would end. In a stable Russia with strong a strong independent judiciary, Russian stocks would take off.
interesting times indeed. lets see and i think its going to be a white knuckle ride down a long russian slide. Not good for the old heart pressure!!!!! By the way any views on which side fired the rocket. Sounds like the Ukrainians to me as Putin has denied any involvement.
If Putin goes wild it becomes the endgame for him. The oligarchs will not tolerate it and if the economy slips beyond a certain point the Russian people will not tolerate it. Russia is now the only country willing to oppose the American hegemony, his strength against their influence is the very thing that makes him popular in Russia. He has to tread a fine line between this and utter chaos from international isolation. The 'Russian Factor' is baked into the sp of every Russia operating stock, it has been for ten years. If he seized western assets operating in Russia then the capital outflows that would follow would cripple the Russian economy within a few days. Such an event would result in social collapse. Interesting times
thanks ganmbier01. i respect your views and agree EXI is a great business. Will we shareholders see the reward is my only concern. Its in Russia obviously and so potentially is affected by any negative issues and who knows putin may decide to become more isolationist despite the economic impact given recent events etc and then anything could happen. i do not think that it being listed here makes any real difference when it comes to how the main players will act. What do they care when they are in control thousands of miles away.
Exi has no debt, a large growing cash surplus and a large flexible debt facility if required. Massive cash flows. Infrastructure paid for so no requirement to spend. Very stable oil production levels producing excellent net backs. Sanctions are devaluing the rouble and increasing dollar oil prices so making exillon even more profitable. It is a uk listed company with no connection to the sanctions. Half the oil stays in Russia the other half is exported. Exillon is a cash pile producing machine with no debts or significant expenditure, unlike nearly any of the other listed small to medium oil companies