Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Does this RNS and share buy back get me to buy back into SQZ - nope, net cash is way lower than expected, i would of expected the combined group to have higher production, is a progressive dividend really safe, debt laden, not enough net cash to make any meaningful acquisition and Labour gunning for more cash from oil and gas.
It will be interesting to see how KIST end of year results stack up with SQZ, where they have lower production - i bet they have a lot more cash
SQZ currently up 6% looks like positive response from investors old & new!
NQM,
I see your point and agree, however as you and I know, PE like to extract as much cash as possible and load up debt. I fully expect dividends to continue to be maxed out whilst our drawdown on the RBL jumps significantly this year.
Mitch's last day today as CEO, new M&A on horizon that comes with new CEO, AA maybe !
ps Mr Market this morning certainly likes our direction of travel.
aimo & dyor
Disappointed this was mentioned in the outlook
It’s supposed to be a drill of significant importance
NKOTB,
Over £200m of that is owed in debt.
I should have been clearer, net cash in excess of £100m is where I would like us to be.
NQM,
Cash "of £291.0 million at 31 December 2023..." so still plenty of opportunity for cash deals.
aimo & dyor
Results, cash position, dividend increase, share buy backs started, tax loss from Tailwind a bonus as was Oil addition and the forward look with opportunities outside UK being explored are far better than many suggested and the business is ideally placed to grow again with both Uk and outside opportunities going forward. 😉
I agree with your sentiment regarding Mercuria's influence NKOTB.
Due to EPL we are simply not generating enough profit to justify a 23p dividend.
A more sensible split of the £103m profit would have been £40m divi, £20m buyback, £43m retained as cash.
Cash in excess of £100m would give us adequate breathing space to consider an acquisition from cash only.
aimo
The new financing facility brings increased capacity with duration extended to end 2029, strengthening Serica's capability to pursue further growth.
The acquisition of Tailwind Energy Investments Ltd, was completed in March 2023 and has provided operational diversity and scale for Serica. The net proforma production from the combined portfolio for 2023 was 40,121 boe/d, which was split 56% gas and 44% oil. This split between oil and gas is far more balanced than in 2022 when Serica's production was 91% gas
The Tailwind assets have therefore provided Serica with substantial protection against the significant fall in gas prices. 86% of Serica's production is operated and the Bruce, Keith and Rhum contribution is now around 50% of net production rather than 80% prior to the Tailwind transaction.
Serica has maintained its record of more than replacing reserves since 2018 with net Proved plus Probable ("2P") reserves on 31 December 2023 of 140 million boe, up 10 million boe from 130 million boe at 31 December 2022 despite producing 14.6 million boe in 2023 on a proforma combined Serica and Tailwind basis. This addition of 24 million boe during 2023 represents a reserves replacement ratio of 179% with over 90% of the 2P reserves in fields that are already in production.
The Company is therefore continuing with its growth strategy of investment in projects designed to enhance and extend future production profiles. The Tailwind portfolio came with several short-cycle, highly value-adding opportunities which were matured in 2023 and will be exploited by our ongoing four well drilling programme which is also being undertaken with the benefit of the current capital allowances and with the resultant production sheltered by the ring-fence tax losses we acquired with Tailwind
Should of stayed as they were
Sorry about spelling error on earlier post, just woken up, no glasses and on phone whilst still in bed !!!
More so, interesting that we have started a share buyback when hopefully cash is needed for any M&A to reduce our reliance on our US$1,050m RBL drawdown facility. Call me cynical but has this TINY £15m BB been engineered to aid letting out the TW founders ! Also, as I have feared, for me this RNS and distribution of cash is fully aligned with how PE firms work and in-keeping with TW handling of cash rather than SQZ historically cautious approach. Mercuria's influence strikes again !
aimo & dyor
''If good opportunities for increased value should arise in the UK of course we will not ignore them, but in the current circumstances we must consider other alternatives. Hence the Board has now refocused and increased its search for projects outside the UK where we believe we can deploy our skillsets to deliver increased shareholder value. We are currently focussed on identifying attractive opportunities in the broader North Sea region beyond the UK. However, we will remain disciplined and will only invest in projects or make acquisitions where we are confident that they will deliver increased value and returns for shareholders.''....
A lot to like, divi increased, buy backs announced and a new CEO to be appointed shortly who is very likley to start to aim SQZ's business away from UK tax 👍
Final dividend of 14p per share increasing total dividend for 2023 to 23p & start a £15m share buyback
https://twitter.com/surprised_trade/status/1783018560522014853
£103m profit after tax was what I was expecting, give or take. £92m of that will go in dividends and another £15m on the share buyback will eat the lot, and a nibble of our cash.
aimo
That’s a talking point
Divided held and share buyback …
“ The resilience of Serica's financial position allows the Company to maintain the final dividend at 14p per share meaning an increase in the total dividend for 2023 to 23p per share compared to 22p per share in respect of 2022. Furthermore, the £15 million share buyback initiated today is a demonstration of the Board's confidence in 2024 cash flows and the longer-term value of the Company's assets.”
I’m in TRP
SOMEONE HAS JUST BOUGHT 5% of the TRPS shares today
if that helps.
Prospect is further north but in between known reserves in Angola and southern
Namibia so worthy punt as it is so low I’m averaging down there myself.
Serica was just a few years too early with Namibia, deep water drilling with little infrastructure in place so very high cost, they really had no option but to relinquish the licence.
Also have Namibia covered with ECO, been in since the original Guyana drill days and have just been bottom drawed for a few years. I'll be adding throughout this year as funds permit to bring down my average in the lead-up to Total drilling, hopefully in Q1 25.
Yep true! I’ve been doing the same myself though, i can’t find anything on the block unfortunately.
May take a look at ECO though
Your forgetting the pain when BP pulled out Deeko!!
Know what you mean mind, I did recently try to find out if anyone took over the licences but it was difficult to ascertain. Personally have a reasonable tranche in ECO that has a presence - SQZ wants some oversea's ????
Not in here but just reflecting on when I was a holder - Bitter pill to swallow that Serica gave up on Namibia following GALP’s 10 billion barrel discovery. That block would be worth a fortune now. I see this becoming the next Guyana with multi billion barrel finds in succession.
Wrong post mate this is SQZ not GKP!!!
Does anyone have any news on why we are having such a sharp rise in the SP today? Very welcome news but there must be a reason for a 13% rise. Could it be news on the oil pipeline opening?
Question is what will this lot go after next.These idiots really do believe that they can double up on the opposition. I really do now believe that the current hmg together with the opposition are now foreign agents destroying the fabric of what is left of the uk inmho. dyor.