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Good posts, sound man. We have some excellent posters on here. Pity there is some negativity in some recent posters, we don’t need that.
Thanks for your post. I am very optimistic and have averaged down as I increased my holdings in this company.
I have faith in Directors as well, especially Alan Booth who IMO negotiated a good deal for Ophir (many might disagree) and an excellent sale of Encore Oil to Premier.
Received regulatory approval for the development
of the Victory gas field. As it plugs into existing
infrastructure, including Kistos’ co-owned
Shetland gas plant, this could extend the life
of the company’s own oil and gas assets in
the area, reduce costs and potentially delay
decommissioning.
Kistos demonstrated its financial strength by
paying down a little under €80 million worth of
Dutch bonds early in December, which will reduce
interest costs. It closed out 2023 with cash and
‘near-cash’ of €275 million (though net debt of €73
million according to investment bank Berenberg).
Based on forecasts from Berenberg the company is
expected to generate free cash flow of nearly €150
million in 2025 as new assets come on stream.
This should provide the firepower for further M&A
and is more than the current market value of the
business.
If Kistos (KIST:AIM) had its way it may well not
have been a small cap by this point. It had hoped
a merger with Serica Energy (SQZ:AIM), which it
tried and failed to pull off in 2022, would have been
a ticket to Main Market status and a place in the
FTSE 250.
Having absorbed its failure to get that deal over
the line, some other operational disappointments,
and a significant drop in the high gas prices which
followed Russia’s invasion of Ukraine, the shares
have been marked substantially lower by the
market.
This has created what looks a pretty compelling
opportunity for risk-tolerant investors to buy a
company with enviable balance sheet flexibility,
scope for significant growth in free cash flow from
its existing portfolio and ambitions to target further
deals in the northern European energy space.
The company is run by Andrew Austin, who
may be familiar to followers of the sector from
his previous ventures – including Rockrose Energy
(taken over in July 2020 in a £243 million deal).
Kistos’ current producing assets are based in
the Netherlands and, in line with the company’s
strategy of delivering hydrocarbons with lower
accompanying emissions, the platform on its core
Q10-A field is powered through wind and solar
generation.
The company is also developing assets in
Norway and to the west of Shetland. It received
a boost in the latter region when Shell (SHEL)
Said without a hint of bias ;-)
On the other hand AJ Bell have just listed Kistos as one of 5 Small Cap Stars to Buy Today.
Maybe they know something we (you) don't. I'm an AA believer after RockRose so if it goes anywhere near 100 I'll be raiding the piggy bank.
Big volume of sells today.
Does that mean the major seller is now cleared out?
They are disputing and have provisioned 42m worth of tax with the NL govt. IIRC AA said he was pretty confident the outcome. At todays price the release this provision would b worth 30% of the mkt cap. Crazy valuation here vs the assets.
That said all very normal for LSE stocks. Country is f'd.
So now worth less than before fundraiser to do the Tulip deal.
despite 3 deals since then the company has lost value,,, can’t blame it all on windfall tax as you don’t get taxed at more than 100%!!
Netherlands- been a disaster, no drilling success and even basic work overs not resulted in any better production
GLA- not too bad but no sign of Glendorach and Edrador west getting go ahead to add any value,,, total dragging feet on it (may be as they are wanting out of the whole thing and selling) , scary decom liabilities too
Mime- could be all good but more delays and cost at Balder project,,,, Var already taken big write off,,, no chance of starting up 2024 so company needs to update
so maybe AA not the great dealmaker ppl think,,? if something new deal up his sleeve then may be treat with caution as could be just a distraction from current performance
liquidity concern too? not making much cash at these prices, balder will eat capex, tax bills to pay and they removed comfortable headroom buying those bonds back when imho should have held onto cash
If SP is overeaction then Aa could RNS to reassure,,, fact is nothing yet forthcoming so suggests no good news or reassurance to give
gla
GD
As AA has said before in RNS' and on podcasts investment in UK assets doesn't return the required returns. The only ones hoping for a Serica transactions are Serica holders.
Commenting on the proposed acquisition, Andrew Austin, Kistos' Executive Chairman, said:
"After a period during which commodity price volatility and fiscal uncertainty has made it difficult to agree deals in the UK and the Netherlands, I am very pleased to be able to announce Kistos' expansion into Norway. Kistos has evaluated several transactions in the UK and Dutch sectors, but the imposition of punitive windfall taxes and a lack of fiscal certainty have meant that both countries remain difficult places to commit capital and ensure continuity of shareholder returns."
AA is a major shareholder in Kistos and it's effectively his baby. The only way you'd get him involved in Serica is if you merged the 2 companies.
As said below Serica is out of Kistos' reach now from a straight takeover perspective.
@jaytee41 - I had exactly the same thought.
Some retails panicking because of the lower reported production of GLA in December, without considering the temporary halt of the Shetland gas plant
AA is not CEO, but Chairman, totally different roles
Mitch Flegg resigning soon, so they will be after a new ceo. Wonder if AA will be hunted
In any case, it would be the other way around
Serica is surely impossible with the current market cap.
AA will come good.
I enjoyed the ride up (and my sell down) from 110 to 600, although I wish I sold out completely at those dizzy heights, never mind, my memories of Rockrose were too strong.
Sub 150 now would seem to be a perfect level to rebuild a larger position, but is it the bottom? Surely it can't go near the IPO price. We're certainly a million miles from the Employee Incentive Scheme levels, ironically the issue of that timed closely with he beginning of this fall.
One things for sure, AA doesn't sit on his hands. Something will come along soon, or cash will be returned to shareholders in some form.
Maybe another go at Serica?
Yep, another morning another 5% gone. Looks like PI's are bailing and I completely understand why given the tumbleweeds. I really find it mind boggling that they cant or more likely, for some stubborn reason, won't issue a statement 1 month after the close simply stating revenue, cash and debt. It's not exactly war and peace
I notice Total have won 10 licences shared with Shell. Read somewhere that Kistos will share with Total. This would have been from Kistos. Did anyone else read it? I believe the area is WoS.
Eh?
AA - issues are there within Kistos…… a big shareholder I know seems to think it’s a matter of weeks if not shorter that the Kistos price move will happen. Reason ? Watch this space……… price is silly here. Mr Austin, will play his cards well.
Seems to have no support. Company comms are frankly rubbish. A trading update is urgently required.
Sorry, that third paragraph should have read
"We know we averaged 9.6k to the end of June and production from July to the end of November averaged 8k. We had just 20 days of production in December from GLA due to the shutdown at the SGP. Our total production for the month needs to be above 6k to meet the guidance of 8.5k to 10.5k."
We should do it easily. 2.5 - 3k from Norway, 2.5k - 3k from the Netherlands and around 2k from GLA.
*20 days of production from GLA*
Production averaged 8.8k per day (5783 boepd of gas and 3035 b/d of oil) and Tormore returned to production.
For the year I am guessing our average production will be around the 8.5 to 8.6k per day mark.
We know we averaged 9.6k to the end of June and production from July to the end of November averaged 8k. We had 20 days of production in December which needs to be above 6k to meet the guidance of 8.5k to 10.5k.
Breakdown for November.
UK (GLA)
Glenlivet 44.5mmscf/d
Laggan 36.6mmscf/d
Tormore 5.4mmscf/d
Total production per day = 15331 boepd of gas and 738 b/d of oil.
20% net to Kistos = 3066 boepd of gas and 148 b/d of oil.
NORWAY (BALDER)
Total production = 28,871 b/d of oil
10% net to Kistos = 2887 b/d of oil
NETHERLANDS (Q10-A)
Total production = 4528 boepd of gas
60% net to Kistos = 2717 boepd of gas
aimo dyor