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Great reply Mr Upham, sir. Your explanation makes complete sense to me
Thanks for the responses and clarifications.
No need to insult or call me de-ramper (I have been invested here for a long time, besides I don't think I have that influence to manipulate the SP with my comments).
I genuinely wanted to know opinions from fellow investors, I liked the fundamentals of this company therefore I invested, I am not an oil drilling expert..
Good response to Alessandro's post, dickupham; was on the point of making similar observations myself, fwiw...
The CEO has officially stated that the financial impact of the interruption to production "will be mitigated by the revenue sharing arrangements already in place", so no real setback here, just an annoying cessation of output for a couple of months envisaged to remedy the problem.
As for the divd declaration to be announced in April, this will be predicated on the 2019 results already 'in the bag', of course, where earnings cover should be higher than the 2018 figure of 22p ps (my guess is some 30p ps will be reported, fwiw) - ergo, there's ample cover for the maiden divd to be announced then.
A 5p ps divd would be well within the Board's declared policy of a 'sustainable' distribution, imv, putting the shs on that near 5% yield and you don't get too many E&P issues on AIM offering such an income stream that I know of, apart from RRE...
The value argument here is well under - pinned, self - evidently - sasa.
Everyone is free to express opinions, but some opinions are worth more than others. Those expressed by people who haven't done the slightest bit of research before posting negatively (or indeed positively) about events that are fundamental to a company's share price, aren't worth anything.
To address Alessandro's post:
"Is it matter of if or when, regarding the resume of production?" If you're suggesting a broken caisson on the Bruce platform might cause a permanent loss of production from the Bruce, Keith and Rhum fields, then I suggest you consult a psychiatrist.
"I envisage there might be a delay in dividend pay-out following this accident"
I would ask the question "why do you think this Alessandro?"
At 31 December 2019, SQZ held cash balances in excess of £100m. It has no debt. During 2019 SQZ generated c£60m of net cash. On 14 January 2020, its CEO stated: "Serica expects to announce its maiden dividend at the time of the 2019 Annual Results in April 2020".
We have not heard in the 3 weeks out of the 8 weeks anticipated production loss since the problem with the caisson was announced, that there are any circumstances that would cause the directors to believe the situation is to a material extent different to that disclosed. To cancel a dividend payment effectively promised to shareholders based solely on a temprary set-back would be an act of self-harm by the directors. They will know that were the market to regard such a dividend as sustainable, it would underpin the Company's share price based on a dividend yield measurement alone. There are of course many other factors that affect the share price in companies like SQZ, but to be able to rely on an annual income from a holding in the Company would prove attractive to a range of potential new investors, bringing added strength to the share price.
I don't expect you to understand what follows, but a dividend of (say) 5p (people will have different views about how much will be decided upon) would produce a dividend yield of close to 5% at SQZ's present SP. Such a dividend payment would cost SQZ about £14m - hardly stretching for a company generating so much cash, regardless of the unusually low gas prices and the temporary production loss from BKR.
I accept you say: there "might" be a delay in the dividend payment, but it is clear to me your intention is to sow the seed of doubt into holders of SQZ shares. You failed in my case. All you havedone is shown is that you haven't read what's been published and applied intelligent thought. The following might help:
https://www.investegate.co.uk/serica-energy-plc--sqz-/rns/corporate-update/202001140700056658Z/
https://www.investegate.co.uk/serica-energy-plc--sqz-/rns/bruce-platform/202001300700123619B/
GL with DGOC
dyor
No reason to delay dividend Alessandro. Bib fund of cash sitting in accounts and also it will onlybe a dividend declaration. They won't pay for awhile anyway. Methinks you are obviously a de-ramper.
Is it matter of if or when, regarding the resume of production? I envisage there might be a delay in dividend pay-out following this accident
And I'll go all in and sit for a year, best management in the whole of aim bar none.