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No divi cut Tamovv as far as I can see. Good debt reduction and fcf, but reduced production in 2024 (56-61 kboe).
Hi guys,
Happy to see some activity here going on!
@asartara as stuGGTTH already pointed at, their initial plans (made prior to the EPL desaster) even stipulate a 5% dividend increase to 420 mUSD for 2024. This would result in more than 20% dividend yield. So I assume the market believes the dividend will be cut - I unfortunately Mr. market might be right this time ;) Please find one of my posts below, where I tried to come up with an early guess for 2024 CFFO (and thus the dividend).
As it can be seen in the prospectus and as it was repeated several times by management during past conference calls, ITH plans to distribute 15-30% of CFFO (cash flow from operations after tax) to shareholders, mostly dividend but theoretically also as buybacks. Unless something unexpected will be announced (i.e. M&A activity), I expect them to use the top end of the distribution range given the current low level of leverage well within their 1,5x EBITDAX threshold.
Actual January 2024 production seemed a little bit weak to me, on the other hand brent sits quite strong at 85 USD/boe or even higher with Russias decision today, so I just slightly reduce my CFFO estimate towards 850 mUSD resulting in a potential dividend of 200-240 mUSD (up to a 50% cut). Given the current yield of 22% I expect markets to expect a about 50% cut as well aiming for 9-11% target dividend yield.
In my opinion any positive news regarding the sale of Cambo project shares, CEO presentation, (positive M&A), or production above my 65 kboe/d guestimate resulting in higher CFFO und thus dividend could boost the shareprice on Wednesday. I´m not too experienced to have any concrete idea in mind why they decided to postpone the data release on short notice. However brent moved very nicely recently, hopefully they put some nice hedges in place as they have proven in the past.
Talk to you on Wednesday folks, I am sure we will at least get a 2024 production FC and hedging schedule so we can update our models, any dividend guidance would be a bonus in my opinion (potentially seeing them just reconfirming the 15-30% CFFO policy and calling for being patient to see how 2024 develops from an operational standpoint).
Ithaca Energy is pleased to announce its third interim dividend of $134 million, representing $0.1321 per ordinary share. The third interim dividend will be paid on 17 April 2024 to shareholders on the share register on 2 April 2024.
The dividend is payable in cash in Sterling to holders of the ordinary shares. Sterling dividends payable will be converted from US dollars at the average of the mid-point of the market exchange rate on 27 March, 28 March and 2 April 2024. Accordingly, the Group will confirm the foreign exchange rate and the amount of the Sterling dividend payable in pence per share on 4 April 2024.
Enquiries
They mention dividends in the Prospectus, page 14....3.1.6 Dividend Policy
https://ithacaenergy-files.fra1.cdn.digitaloceanspaces.com/Documents/IPO-b2f4d6/Ithaca%20Energy%20plc%20-%20Final%20Prospectus.pdf
Although with final results on 27th it may be completely clarified
Stu
Is the dividend expected to be kept at current levels for next year?
Thanks, more than happy with the Dividend, awaiting their forecast for next year.
Me too...according to PR company, they have been put back to Wednesday 27th March.
We had the dividend news yesterday.
Current date for results is March 27: https://investors.ithacaenergy.com/news-events/financial-calendar
I thought the full year results were expected yesterday?
They keep their word.
https://www.londonstockexchange.com/news-article/ITH/announcement-of-interim-dividend/16387826
@Tamovv - told you you're getting this divi for free :) and then some...
Congrats.
Https://www.energyvoice.com/oilandgas/550290/repsol-north-cayley/
OIL i feel be fine gas who knows but lucky its spilt 33 percent gas to 67 percent volume on oil .Please correct me if i am not correct .
Mr. Tornado, you got a little carried away...
The purpose of my post was to flood the distortion that exists in the market regarding Ithaca!! Not beyond that...
@londoner7 - Thanks, that's useful. So Feb-Mar should be around 59Kboed, but April should come back to around 64-65. Notice also the drilling of additional wells in Alba and Schiehallion.
@Tamovv - re EPL - IMHO Ithaca is sooo discounted that not only is the spring budget announcement priced in, but one could even argue that the price already reflects Labour's perceived outrageous plans.
The next two weeks should be interesting, with the March 21st report coming out. Additionally, it is my understanding that according to Israeli law, Delek must publish an updated full reserves and resources report, including detailed revenue and cash flow projections. I think we can expect to see how deeply Ithaca's share price is discounted.
Kindly leave quarrels from other online communities out of here, PLEASE! We have a good thing here, please don't ruin it.
This post was supposed to monitor information about Leverett and K2.
Hi Tornado10
Did you see Harbor's report???
https://www.energyvoice.com/oilandgas/north-sea/549544/harbour-energy-2023-earnings-tax/
"effective tax rate of 95% on its UK operations"
It's amazing to see the huge advantage of Ithaca over its competitors because of the tax shield and offset investments it has!!!
And people without understanding continue to compare Ithaca to Harbor....
Today's update in Harbour Energy's report (on p. 3): "we successfully appraised the Leverett gas discovery in 2023 with the potential development via a subsea tieback to the Britannia platform now being evaluated."
https://www.harbourenergy.com/media/szljzatx/harbour_energy_full_year_results_2023.pdf
Good!!! Now we need to see some numbers and schedule.
Good news on Pierce.
Unfortunately, last month SQZ reported a problem on Erskine, "Erskine has been shut in since 25th January 2024 due to an issue with a compressor. It is expected to restart during March." Erskine is a substantial producer for Ithaca - over 2 months production was lost from Erskine last year.
I've heard comments from Ithaca on Captain production that seem to vary with the wind - good, cautious then good again.
In a couple of weeks we'll have 2024 production forecast which should take in all the various anomalies. I suspect we'll see a relatively wide forecast taking in what I think will be unknows on Captain - when will the impact of polymer kick in and to what degree.
The detail on CapEx should be interesting.
Thanks for your swift reply (and the congratulations on my timing...lets this how this develops this week since the EPL extension has just been announced, ITH suffered a little bit today, hopefully thats it!).
I noted Pierce but dismissed it due to the small extent of ITHs share, shell´s like 93%.
I was aware of Captain Phase 2, but not of the exact timing, didn´t remember it´s so close from startup - thanks! Any indication on expected production boost? Just spent 15-20 mins on Google but didn´t find any indication on its desired effect.
However, looking very much forward to Q4 results and guidance end of this month, so we call can finetune and adjust our models.
Hi Tamovv,
Two factors, one relatively minor and the other quite significant, should work in Ithaca's favour:
Firstly, the continued shutdown of the Pierce field, which according to today's news should be resolved later this month (https://www.energyvoice.com/oilandgas/north-sea/549256/shell-pierce-restart-outage/), is a minor factor.
Secondly, and more importantly, first oil from the Captain EOR Phase II project is a major development. According to the Q3 update released in November 2023, "The Captain EOR Phase II project is approximately 80% complete with estimated first subsea polymer injection in H1 2024." This Captain EOR project should provide Ithaca with a substantial, one could even say dramatic, boost in production.
By the way, congratulations on your recent purchase of shares at 1,28 (I remember you mentioning it in one of your replies to my Q4 production estimation). With that purchase timing, you might just receive a dividend "for free" :)
Hi Tornado,
Many thanks - very useful!
I am rather disappointed how this compares against my "simple 2024 guidance" of 65 kboe/d, taken from comments made during the last conference call.
How do you interpret this January production? Given Q1 used to be a very strong quarter for ITH and scheduled maintenance still to come in Q3, this draws a cloudy picture of 2024 in my humber opinion. Of course January only represents one third of Q1, but anayways... Are there any problems known on re-ramp-ups for February/March planned, so that we can expect Q1 to finish better than the January run-rate?
NSTA just published the North Sea production numbers in January this year.
https://hub.arcgis.com/datasets/ba8b7b78d3a74edc88293011981ce2d7_0/explore?showTable=true
As per my calculation, Ithaca's numbers are 62,799 boe/d. (Oil 42588 bbl/d, gas 20211 boe/d).
This is a very conservative estimate!!
Ithaca trades at a deep discount in all parameters
Apparently Ithaca could be 26% below intrinsic value
https://finance.yahoo.com/news/ithaca-energy-plc-lon-ith-071016424.html
Always take with a good pinch of caution but a cheery thought nonetheless
It’s no coincidence that all the North Sea oil and gas stocks are “pricing a doomsday scenario”. The latter is the incoming General Election, who would hold these stocks as we approach. Labour win will see another step change downwards imho. The likes of HBR, SQZ all generating cash for HMG.