Member Info for AceofClubs

All she said was: "SENIOR hires of WHITE MEN are signed off by her OR the head of HR because she wants to make sure that the process followed for that recruitment has been diverse, has been properly done". So that means ensuring that the job was open to everyone and not just the OLD, white men who went to the right school.

Amanda Blanc stands condemned by her own words as discriminatory on the grounds of race and sex, to which her defenders now appear to have added age and attending the wrong school!

The only otherwise successful applicants who run the risk of being black-balled by Amanda Blanc are white men: possibly too old, wrong school tie. Wrong, wrong and wrong again.

AceofClubs

It is now apparent that AVIVA has the highest paid HR assistant in the UK and possibly worldwide. If only she was fulfilling the role she was employed to do. Where are you BoD?

AceofClubs

The fanbase of DEC appears to be growing ever more desperate to explain the decling share price - it's been everything else in the past few weeks so no surprise it is now described as yet another "victim" of Brexit!

"It just seems that most of this has its routes (sic) in Brexit." But maybe not: "I don’t want a Brexit debate as it could just be coincidence. "

The DEC financial modelling is based on two major assumptions: 1.) a $4.66 Nymex strip for NG over 10 years - then rising to $4.91. 2.) A 4.5% annual decline rate in the production output of their existing wells for their whole life. If you believe both of those assumptions you will be a very content holder, the dividend is safe and the market is wrong. If these assumptions prove to be optimistic then the Free Cash Flow collapses and the first in line will be the dividend.

A less immediately pressing issue is well retirement costs. DEC's assumptions and declared experience to date are circa $20,000 average per well. All of the third party evidence shows much higher costs - but DEC could be super efficient in this process?

AceOfClubs

Rob Wood - CFO:

Share sales since November 2021 have realised £2,255,109 - buys total £24,000. CFO's can usually add up.

AceOfClubs

Decent performance again in the current macro climate. A minnow in the asset management sphere - it's a pity they don't get a chance to show what they could do with 3x the FUM. So much in the hands of serial non-performers like AVIVA/M&G/STJ and the clearing banks.

AceOfClubs

Https://seekingalpha.com/news/4037390-walgreens-boots-close-to-5b-pension-deal-report

Always very wary where both parties to a strictly financial deal declare it's profitable for them, it can take decades to find out who was right.

AceOfClubs

Many thanks Andy414 for the tip on those big blue letters and numbers on the left of each post - who would have guessed it!

I take it from your use of the Royal "we" that behind your handle lies the Duke of YorK? Only joshing! I'll let you get back to Sarah now.

AceOfClubs

Comparing where DEC is at 30 September (or Currently) 2023 with 2022.

Exit Rate of Production (Mboepd) 2023 - 134.4 2022 - 144.0

Realised Prices ($Mcfe) 2023 - $3.46 2022 - $3.65

Adjusted Operating Cost Per Unit ($Mcfe) 2023 - £1.63 2022 - $1.63

Current Liquidity ($Millions) 2023 - $135 2022 - $400

Make your own judgements.

AceOfClubs

Good results in the macro climate of the past 6 months. A well managed business under private investors radars so very little interest on LSE!

AceOfClubs

"yet again,certain traders.fund managers etc had advanced knowledge of an RNS"

It's not a Regulatory News Statement. It is a meaningless piece of PR puff generated by a self-appointed, self-important PR company called Unicepta.

Anybody who thinks this can move share prices.....

AceOfClubs

@Ticketi-Boo - You have awakened a distant memory in me.

" I've never seen a CEO of a company sell their shares even before they go under." Globo?

Globo was subject to unexplained share price weakness over an extended period. The CEO and FD were selling their entire holdings into the market - but not disclosing. The penalties for this in the US would be far more severe but DEC is London listed so would UK law apply?

I have no evidence that is the case with DEC, but it has happened in the past. The SFO never laid a glove on the Globo miscreants.

AceOfClubs

Maybe not.

https://www.theguardian.com/world/2023/oct/26/hurricane-otis-mexico-acapulco-damage-aid-military

AceOfClubs

From a Net Income of £178M in 2021 Marketscreener is forecasting £17M in 2024 and £25M in 2025. Struggling to see any deep value above 50p. CMC appear to have lost the ability to make any meaningful profit. Does anybody know why? I know volumes have declined but didn't they see that coming? Can't they adapt top market conditions?

AceOfClubs

Jim800 - We can certainly agree period on period comparisons are difficult because of the welter of acquistions over several years. 2023 will be the quietest year since the IPO but still a 1 February $250M acquisition with " Current net production of ~17 Mboepd (101 MMcfepd) (76% natural gas), representing a ~12% increase vs. the Company's December 2022 exit rate net production".

Added to DEC's existing exit production at 31 December 2022 of 141 Mboepd that would be 158 Mboepd at 30 June '23 with no decline. DEC declared 144 Mboepd exit rate at 30 June - an 8.9% decline in 6/5 months.

Whichever way you cut it, production output is in decline at rates that will seriously reduce cash flow. Hedged selling prices will inflict further damage in 2024 and 2025.

Halving the dividend would still offer a 10% yield at 70p and may even boost the share price!

AceOfClubs

@Agricore

“You ask when has $4.66MMBTU or higher been achieved?” You misquote me. I asked “When has DEC ever achieved close to $4.66?”: with reference to average selling price over a 12 month period. DEC is using this average over a 10 year period to support its cash flow thesis. I then went on to demonstrate the improbability of this with its published hedged prices over the first 3 years.

On production output I wrote: “My estimate is that output at end of 2023 will have declined around 10% from output at 30 June, only partly because of disposals.”

Exit output at 30 June was given by DEC as 144Mboepd – the commentary on third quarter production listed an average of between 134-138Mboepd – a 4%-7% decline from 30 June – so 10% by 31 December could be conservative.

DEC themselves in their Half-Year report state: “Maintained industry-leading consolidated corporate decline rate of ~10%” To maintain their cash flow thesis they again have to make the unrealistic assumption of a 4.5% decline rate.

You can call the market wrong all day long; but that usually ends in tears.

AceOfClubs

The share price says the market does not believe the dividend is sustainable. Is the market right or wrong? I think it is more right than wrong. Operational cash flow has been in decline for 18 months - despite all of the accretive acquisitions. The latest Corporate Presentation dated 19 September, slide 33, requires the following assumptions: Nymex 10 year strip at $4.66MMBtu and production decline rate of 4.5%. When has DEC ever achieved close to $4.66? It will not in 2023 (85% hedged at $3.79) or 2024, (80% hedged at $3.31) or 2025, (70% hedged at $3.26). See slide 29 of presentation. Why is selling price so crucial? Because every extra cent earned is cash profit. If output remains constant cash generation takes a big dive from 2023 levels in 2024 and another downward leg in 2025. Output will not remain level. Slide 33 requires an output decline rate of 4.5%. DEC has never achieved such a low decline rate. It used to boast of an "industry leading" decline rate of 8.5% (only industry leading because it had the oldest collection of wells in the industry!). My estimate is that output at end of 2023 will have declined around 10% from output at 30 June, only partly because of disposals. RCF levels at 30 June indicated that cash flow was already under pressure. With output and selling prices guaranteed to fall in 2024, cash flow faces a double whammy. All at a time when leverage is at a peak.

The dividend looks under threat; the market prices accordingly. Wish I could be more positive but the numbers don't look good.

AceOfClubs

From the DEC 2023 Interim Report: "During the six months ended 30 June 2023 we retired 100 Diversified wells, inclusive of the Central Region, at an average cost of $20

to $25 thousand per well."

Ignoring the contradiction in the statement ($20 to $25k per well is a range not an average) how does this compare to third party evidence and experience?

The Ohio Valley River Institute examined the evidence from the 4 States it covers and in which DEC operates covering the year 2020. The figures it compiled show these States (Kentucky, Ohio, Pennsylvania & West Virginia) plugged 467 wells at a cost of $17M an average of $36.4k per well at 2020 prices.

In August 2022 the Federal Govenment awarded $25M to each of these States for orphaned well plugging.

Kentucky plans to plug 627 wells - $39.9k each

Ohio, between 170 & 320 - using the median figure of 245 - $102.0k each

Pennsylvania, 227 - $110.1k each

West Virginia, 202 - $123.8k each

All wells are individual and will have individual costs associated with plugging and site restoration. On this sample of 1,301 wells, at a cost of $100M, an average of $76.9k per well.

No opions expressed, it's just numbers.

Source: https://ohiorivervalleyinstitute.org/getting-unions-connected-to-orphaned-well-clean-up-a-second-bite-at-the-apple/

AceOfClubs

I am a bit shocked and surprised at an offer at any price by Apollo Global Management after their diasterous foray into bottom end "dining" with Chuck E. Cheese in 2014. I rate the Global Management: but I suppose they are entitled to the occasional bad move. I do hope somebody makes a higher bid!

AceOfClubs

New Ohio River Valley Institute Report Shows Conventional Oil & Gas Well Owner Diversified Energy Lacks Resources To Plug Wells, Including 22,507 Wells In PA

http://www.paenvironmentdigest.com/newsletter/default.asp?NewsletterArticleID=55250&SubjectID=58

AceOfClubs

If you have inside information on the power of the EPA document to move DEC's share price 15% then you have the advantage of us. If it is mere supposition on your part then it is just that; suppostion.

P.S. Calling it as I see it does not make me a doomsayer - I try to look at the evidence objectively - other opinions are available and to those with them the current share price is a fantastic opportunity! What's not to like?

AceOfClubs