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No..
Don't be the ugly stone-hearted share holder. For me it would be ok when the Kurds use the money to buy Covid vaccinations for their people, even if I would get only 50% of the planned dividend this year.
But I got no sympathy for corruption at all.
I think it is a good idea to have a diversification strategy, that Gkp gets a second and a third leg outside of Kurdistan.
IMHO this single dodgy leg in Kurdistan is a corporate risk for GKP and we need a urgent mitigation for this political, corruption risk!
Let the new fella get his feet under the table...
Then kick the legs off IMHO
PUTUP: “Nope. The company is carrying over $200m in excess equity capital. The $50 million is a drop in the bucket, less than two months receipts. More pressure to come.”
Absolutely agree. The crux of the matter is that return of capital has not been aggressive enough. At this juncture both dividends and buybacks are in order. If GKP does not become the marginal buyer to improve the stock price, nobody will in the foreseeable. And in the 160s it would be a good level to start doing so.
"Number of GKP shares outstanding = 213,745,502"
Assuming that sufficient options are exercised for the shares underlying the block listing to be fully issued. Likely a sensible assumption even if the number of shares outstanding at the moment is lower.
"The Special Dividend I see as an attempt to head off criticism by leading investors before the AGM - criticism that has been growing for the last 2 years.
The 2 x Divis is actually quite a finely-judged gamble by the CEO and he might, just might, have staved off a full scale revolt by major shareholders."
Nope. The company is carrying over $200m in excess equity capital. The $50 million is a drop in the bucket, less than two months receipts. More pressure to come.
Funny how those most vocal (and often with the least analysis) about undervaluation are so eager to pocket their dividend and reduce their value at work.
Expect the buyback to follow. Too many weak holders in this stock willing to sell at these levels and pocket their dividends.
I'd rather take the dividend. No other investment has such a good return.
I welcome the special divi, but I think a buyback would have been better.
The thing is, there weren't really marginal buyers for the stock at $68/bbl brent and a stock like GKP will always have a relatively high dividend yield due to the geopolitical risks associated with the region, so further dividends I don't think are likely to push the share price up.
Most shareholders will make the majority of their returns from an appreciation in the share price not from holding for the dividends.
The fact is, they can increase the dividend per share by buying back stock and create that marginal buyer in the market at the same time.
"The Special Dividend is really the least they can do. Given the downdraft in the share price it might actually be better to return capital via a buyback." Yes, for me tax on a dividend, whether special or otherwise, is highly undesirable, if I suspect the dividend tax rates on bare trusts are much higher than for basic rate taxpayers. I'd rather they did buy-backs, particularly as they have recently let rip on the no. of share issued.
(1) The Special Dividend is really the least they can do. Given the downdraft in the share price it might actually be better to return capital via a buyback.
(2) Change in payment regime is not great but not totally unexpected. But it reinforces the fact that GKP is 100% exposed to the whims of the KRG without any recourse.
(3) The money is probably there if it didn't get siphoned off into questionable bank accounts. It might be worthwhile for the IOCs to hire some specialist investigators to trace the money and apply some real pressure on the powers that be within the KRG. I imagine they might become a lot more IOC friendly if they feared that their offshore bank accounts could be frozen.
Bertie look at Divi news as a buying opportunity. 10% is chunky. Oil is going up not down. KRG have never hit the payment date targets so 60 days may help make them look more consistent.
As part of the restructuring of their 3-year $500M loan facility (signed Jan-2017 with payments starting Jan-2020), the KRG were allowed to reduce their monthly payments to Glencore last year to only $3M for the 2nd half of the year, but then increasing to $30M per month from Dec-20 until Dec-21.
Despite strengthening oil prices, the continuing disagreements with Baghdad has severely squeezed the KRG finances and this is part of that ongoing story.
The Special Dividend I see as an attempt to head off criticism by leading investors before the AGM - criticism that has been growing for the last 2 years.
The 2 x Divis is actually quite a finely-judged gamble by the CEO and he might, just might, have staved off a full scale revolt by major shareholders.
Nice yield at 10%. Dip presents a buying opportunity.
1 The confirmation of the Special Dividend reflects how positive the Board view the finances - whether an investor shares that positivity is a personal matter, as is also the choice between taking the cash or reinvesting it.
2 The payment regime has drifted from within 15 days, to within 30 days to over 40 days. So the shift to within 60 days is not unexpected! Treat it as being neutral but it will go negative if they fail to stick to it - there is previous history :)
3 The reduction of the rate of repayment of the debt looks minimal on the surface but IMO it flags up just how desperate the KRG’s finances are. These are not large sums of money on a monthly basis but they cannot find them even with oil over $65 per barrel.
Armasmaximillian
Number of GKP shares outstanding = 213,745,502
GBP/USD = 1.4055 as I type.
Total dividend = $50,000,000/(1.4055*213,745,502) ~ 16.64 pence per share ; Yield = 10.08% @ 165p sp.
Best Regards ValueS
I make it around 8.7p per share held, before tax deductions.
Then a further 8.7p per share for the special dividend, based upon your new shareholding quantity (you may have reinvested the first dividend), before taxation.
What's that divi pence per share then?
"Any thoughts from the more knowledgeable appreciated." I am not one of the knowledgeable. However, improving the payout ratio, all other things being equal, should have a positive effect on the share price. Against that, overnight the oil price fell, and this morning's RNS about the worse arrears payment terms and about the increase to 60 days for payment terms reduced the present value of our future cash flows, an effect that should push the share price down. I am a believer in near efficient markets, so the share price now is going to be justified based on all these events since yesterday's close, as far as I am concerned. Not clever enough to know if we are undervalued or not. We will be 'undervalued' if our BoD is successful in increasing oil production, all other things being equal, which they never are.
I have to say I am not fully clued up on the krg shenanigans but it seems nothing really changes there and generally any expectations of regular payments coming to fruition is nil anyway and for what I know wouldn’t affect the sp too much. However surely the dividend announcement and confirmation is really good news and I would have thought given the sp a bit of a shunt today. Any thoughts from the more knowledgeable appreciated.
Nice RNS
Let’s hope it’s the first of many special dividends
GLA LTH next payment news imminent
RNS Number : 4600Y
Gulf Keystone Petroleum Ltd.
13 May 2021
13 May 2021
Gulf Keystone Petroleum Ltd. (LSE: GKP)
("Gulf Keystone", "GKP" or "the Company")
Special dividend of $25 million
Gulf Keystone, a leading independent operator and producer in the Kurdistan Region of Iraq, is pleased to announce that the Board has approved the declaration of a special dividend of $25 million.
Jon Harris, Gulf Keystone's Chief Executive Officer, said:
"Given continuing strong oil prices, improving macroeconomic conditions and our robust financial position, we are pleased to deliver on our commitment to consider further shareholder distributions and declare a $25 million special dividend, bringing total dividends for shareholder approval at the upcoming AGM to $50 million. We will continue to balance investment in growth and returns to shareholders as we develop and realise value from the Shaikan Field for the benefit of all stakeholders."
Following the previously announced resumption of the Company's annual dividend policy and declaration of a $25 million dividend, Gulf Keystone will be seeking shareholder approval at the Annual General Meeting ("AGM") on 18 June 2021 to pay total dividends of $50 million, comprising the $25 million annual dividend and today's announced $25 million special dividend.
The annual dividend of $25 million is expected to be paid on 2 July 2021, based on a record date of 25 June 2021. The special dividend of $25 million is expected to be paid on 6 August 2021, based on a record date of 30 July 2021.
Both dividends will be payable in pounds sterling and converted from dollars at the spot rate prevailing on the relevant record dates.
As at 12 May 2021, the Company had a cash balance of $179 million.