The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
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In yesterday's webcast they also confirmed they have purchased 16.5m shares so far (Stas- i noticed you only took up to Q1 24 to account)
A lot of companies do exactly that
they buy back shares and hold them in treasury so they can issue them back out in the future to employee's
they do this simply to get around seeking formal shareholder approvals on the issuance of new shares
the net effect on issued shares is zero and hence a waste of money
1. it's a gravy train for management and employee's
2. it's a clear sign of a company with excess cash rolling in and no idea how to operationally spend it to grow the company
buy backs (at least for me) only really work (as a shareholder value for money option) when they are written off (cancelled and removed from treasury) once they are bought back
the net result of the cancellation action being the true number of shares reduces and the financial logic would say as a result of there now being less shares around the share price should rise in relation to any like for like market cap
of course doesn't always work like that but the logic says it should or at least would
any company buying back shares and simply holding them in treasury for long periods of time as a result of having excess cash gets a red flag from me purely for a lack of ambition or ideas on how to better grow the company whether that is done operationally inhouse or externally via acquisitions
"between zero to two shares per PSU" . it will be vested in three years time IF they achieve the KPI's so i don't see issue with awarding successful management if they do their job and looking as SP over last 3-4 years, they seem to heading in right direction.
Having said all that, agree they should find way to go more aggressive with BB! :) in meantime, i will collect the 10%+ yield and buy more shares with my full dividend received.
Stas20 - factor in that the majority of the PSU's have a 2 shares for 1 PSU and the buy back program becomes a joke - reverse splitting 8 to 1 will kill the Share Price cancer.
PetroTal is acquiring Block 131 onshore Peru including the Los Angeles field from CEPSA for US$5 mm. The field produces ~900 boe/d from 4 existing wells and holds 4.9 mmbbl of 40-45 deg API oil 2P reserves. We estimate that 3 new wells (at ~US$12 mm per well) could increase production to 2-3 mbbl/d. There are also opportunities to develop bypassed oil with horizontal wells drilled high on the structure.
We view this acquisition as very accretive on a standalone basis. It also offers important area of synergies that will boost the value of Bretana, ......This has positive impact on overall average netbacks as the Iquitos route commands US$6/bbl premium compared to the Brazil route. The location of Block 131 is of strategic importance, as it is connected by a 130 km highway to the company’s Block 107. We have increased our target price from £1.45 to £1.50 to capture some of the impact of the acquisition.
Not done an accurate calculation but just wow, how many performance shares have they issued, just going back a bit we can see they have issued more free shares than they have repurchased with the buyback. Unless I am missing something this buyback programme is doing nothing for the shareholders other than transferring the company money to the officers and employees. Hmmmm
Performance shares issued
PSU September 29, 2023 - 752,833
PSU December 18, 2023 - 688,010
PSU January 5, 2024 - 6,959,115
PSU March 18, 2024 - 567,025
PSU April 8, 2024 - 1,323,473
PSU May 10, 2024 - 6,372,974
Total PSU 16.66 million issued
Shares repurchased via the buyback
repurchased 5.6 million common shares in Q3 2023
repurchased 4.1 million common shares in Q4 2023
repurchased 4.7 million common shares in Q1 2024
total 14.4 million repurchased
Facts - Amazon water level still at a record low Manaus - Max Manaus Barge shipments possible is 18 000 BOPD - Share Price going nowhere until sales hit 25000 BOPD range.
Buy Backs have not worked when your share volume stagnates and does not reduce thanks to PSU's issued.
Glaringly obvious pipeline transportation required to up delivery for sales.
Reverse split - the latin title is loosely "what the granny club ignores in the Amazon"
Terras caidas
The Ucayali in flood as it passes Bretana is a fearsome sight. I inspected literature on Amazon erosion last year and discovered most of the oxbow phenomena are mostly on the northern bank around the local area. The sudden anxiety on combating a potential problem illustrates how ignorant many are. There's a lot of literature available; perhaps a good intro is
https://www.bing.com/videos/riverview/relatedvideo?q=ucayali+eiver+bank+erosion&mid=BC31E72104D995D5D172BC31E72104D995D5D172&FORM=VIRE
Yurimaguas . . .
and Provencia news update keenly awaited.
#131 Cashabatay - formation
At 1400 acres, multi-stacked, present 4 wells on a 120-metre sands' payzone, shallower shale characteristics evident LosAngeles is going to be a useful add-on. (A fair amount of information shows up on the web.)(What is full license area?)
Interesting- some heavy buying reported after the close- 2.8 million.
Oh my - Q1 out and seems the money picked up on 87% oil shipments to Manus.
And that support your sacred cow SP "buy backs" - oh dear a bit of a sinking canoe - and u just have to luv the "river bank" fund smash and grab job - are we going to see 45p by Friday ???? - Anyone for reverse split and be damned to see the devil in hell ??? Anything is better than this slow death Buy Backs.
Auctus broker note out tonight in addition to Zeus notes earlier- ''We have increased our target price from £1.45 to £1.50 to capture some of the impact of the acquisition''
Listened to the webcast, very impressive
What is the brokers target price then
PetroTal also engages in significant local social programmes in order to help reinforce its local licence to operate. The company has a strong balance sheet, holding US$85.2m of cash (zero debt) at the end of Q1 2024, supporting ongoing CAPEX investment and returns to shareholders, with PetroTal establishing a regular annual dividend of 6.0c/share from Q1 2023, implying a 10% yield at current levels. As such, PetroTal offers investors regular drilling news flow, strong and growing production based on a material asset, significant cash flows underpinned by the variety of export routes, an increasingly established dividend, and a strong balance sheet.
On PetroTal’s Block 107 exploration asset, permitting activities are ongoing, in support of a potential farm out in due course. Overall, this is a further statement from PetroTal demonstrating the company’s significant existing production capability, higher potential on further drilling and export route availability, strong cash generation to be had from this, solid funding position that this creates, and capability to take advantage of this via operational execution. Going forward we expect more of the same – cash generation supporting both growth CAPEX and shareholder returns.
The 18H well is now approaching completion and expected onstream in mid-May.
Pilot exports via the OCP pipeline through Ecuador continue, with the potential for this to add 5mbbl/d of capacity over time. Efforts also continue to establish a new route via Yurimaguas later this year – a further potential 5mbbl/d. We await further news on these and any other new export routes, including potential greater use of Iquitos post completion of the Block 131 acquisition
'' In terms of the Q1 dividend, this is today announced at 1.5c/share (ex-dividend date of 30 May), in-line with the company’s established base dividend level. This further demonstrates management’s confidence in the forward cash generating capability of the business, and its ability to continue funding both growth CAPEX (even allowing for the increased CAPEX programme) and returns to shareholders. ''
''The erosion issues around the Bretana field site are more extensive than previously assessed meaning the cost of the remediation programme is now expected to be higher (US$15m of the increase). These issues are also expected to hinder.the demobilisation of the current drilling rig (otherwise planned for Q2 2024), meaning this will now remain with PetroTal and be used to drill an additional oil well and an additional water disposal well, in H2 2024.
while it is inconvenient to see the erosion CAPEX increased, the balance of the CAPEX revision is more of a rescheduling, bringing drilling forward. Irrespective, the new budget remains well within the company’s funding capabilities. ''
I'd rather we didn't spend a penny on riverbanks, and spent on more wells, that way when the bank collapsed and silts up the river, we can marvel at how many wells we've shut in because we can't get their production barged away.
It's not a cost, it's an investment, and I'm scratching my head trying to work out why anyone would think otherwise....
Ofc. they'll need to spend money on erosion control. Since Amazonas swallows Bretana if they don't. But suggesting it's "normal" or that it's as fruitful as drilling another 5 wells (75 million USD) is just bullocks.
If you look in the IPO or the older annual reports you'll find no mention of CAPEX related to river erosion.
#PTAL remains cheap, etc. and the numbers are great. But not every surprise is good and there's no reason to pretend the extra 15 million (equal to costs of drilling 1 well) is icing on the cake.
Rmember 3 pm presentation
Brent USD/Bbl 84.014 ⬆️
I have i3e in my pf too, re earlier post, i3e have capital costs too, have reduced their divi due to cash flow, drills halt last year etc and situated in Alberta Canada they are located in the wild fire zone that occasionally affects operations.
PTAL has risks, all stocks have risks, unlike many stocks PTAL are seriously cash generating, excellent divi with oprtion of special divi when cash exceeds $60m, well managed financially, adding growth, and no debt....a lot to like
Part of this business is generating goodwill. It's absolutely essential to operating here. The cash spent on the local environment mitigates many risks. I'm 100% behind it, plus any other initiatives to safely balance business with environment.
With respect if river erosion is not dealt with their is no river and its a vital part of the business, all businesses have 'outside' costs as it's part of business, hard to find one that doesn't, many have debt costs, etc etc