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Just look at the numbers as they do not lie !
17 Revenue $6.4B, Gross margin $785M, EBIT : S104M
18 Revenue $5.8B, Gross margin $718M, EBIT : $159M
19 Revenue $5.5B, Gross margin $353M, EBIT : $220M
20 Revenue $5.5B, Gross margin $279M, EBIT : -$142M
21 Revenue $3B, Gross margin $130M , EBIT : - $196M
22 Revenue $2.7B, Gross margin $-76M, EBIT : - $217M
https://www.macrotrends.net/stocks/charts/POFCY/petrofac/financial-statements.
Before SFO case and Covid (which caused contract cancellations and business interruption. These , in turn, resulted in revenue collapse and additional costs) , PFC did reasonable well and even Halliburton was prepared to pay £25/ share for it in 2012
The lenders must have seen and examined latest PFC business plan, provisional Q1/24 trading status and cashflow forecast till Q4/26, and comfortable with the progress of non core asset sale, BEFORE offering to provide $300million (£239million) in fresh credit and to keep PFC going and allowing PFC to miss bond coupon payment, otherwise they would pull the plug by now.
If PFC BOD can convince the lenders with strong proof that the newly won and future contracts have good margins (i.e. 10%+) as before 2019, I strongly believe D4E dilution ratio will not be so bad as the people have predicted (as the major shareholders will fight hard not to let the bondholders or any predator have the company on the cheap) and PFC should be mostly debt free by Q4/26, based on the forecast total revenue (till Q4/26) of $12B and a profit margin of 10%).
" based on the forecast total revenue (till Q4/26) of $12B and a profit margin of 10% "
with Tennet, they are sub-contracting certain parts, of their part of the project....so..I personally think it would be extremely unlikely to end up with such high revenues themselves or a margin as high as that ...there also needs to be strict costs control limitations built into the contract in order to preserve margin
Also PFC is a major supplier of these engineering services - their customers want price competition - take out PFC and it could cost the market easily as much or more in reduced competition and margin / cost increases from Wood / Haliburton etc. IF i was buying in large multi million contracts i would like some price competition.
It pays to keep them in the game. Thanks Blue
Pokerchips $8B backlog + 14% of $44B bid pipeline till Dec 24 and the rest till 26 => Total revenue of $12B to Q4/26 is reasonable, IMHO.
Cuban_Cigar
OK that is fair enough .... I personally am a bit conservative on the $8B in terms of margins, when taking into consideration sub-contracting within those projects , so I see $8b more as a headline figure,myself
Your 14% bid pipeline conversion is certainly not over expecting....BUT it may not be off $44b...remember it is a "pipeline" which doesn't mean they will actually bid for everything within this "total pipeline" , maybe they will, but not necessarily ... some may prove not in their commercial best interest, which happens , for various reasons
" a total pipeline scheduled for award in the 16-months to December 2024 of approximately US$44 billion"
ATB
There's potentially a - very - good business here going forward.. hence this process of saving/rebasing pfc.l.
With a few years patience from here and some half decently timed averaging down by me during that time, I see a reasonably good chance that my equity BET here will, in the round, be at least an OK bet in the end... and a decent chance it will turn out a good bet in the end.. and a small chance it will turn out to be a great bet in the end (eg takeover/merger or serious turnaround to a profitable / heathy debt positioned independent business )
Pokerchips - Another way to look at the total revenue between now and till Q4/26 is taking the combined revenue of 17, 18 and 19 which was $17.7B then knock off 30% to give some safety margin => $12B. As I wrote, PFC did OK till SFO case then Covid. If they manage sort out the financial mess by end of Oct 24 then there is a strong possibility they will survive and flourish.
Cuban_Cigar
yes... a future is definitely there for the taking ....and if there is a huge number of new shares and maybe a consolidation afterwards ( if) , with new debt linked to guarantees, then it is indeed a new beginning .... set sale in a new refurbished ship, as it were ( new shareholders owning the company, to the detriment of many previous shareholders)....although current shareholders may well now have the shares in their pockets at these low prices, having sold out previously...
* set sail