Member Info for AceofClubs

November 2020: "Diversified Energy PLC Enters $1 Billion Acquisition Partnership with Oaktree Capital. The financing structure with global investment firm Oaktree Capital lets sellers know that Diversified Energy PLC has the backing to make acquisitions work in the current A&D environment."

March 2024: "Diversified Energy will acquire Oaktree's proportionate interest in the previously announced Indigo, Tanos III, East Texas, and Tapstone acquisitions (the "Assets") for an estimated gross purchase price of $410 million."

Bulls will hope Diversified and Carlyle is a match made in heaven.

AceofClubs

"Credit for oil and gas has been drying up and/or becoming very expensive in the last 2 years. " - DEC will be buying on credit!!

"In fact, DEC now sits in a very good place in a buyers market." - Opinion, not fact.

"They have the capital and no pressure to buy or not, they can make silly offers." - They will be buying on credit, they have no surplus capital and by many measures are already highly leveraged. Rusty appears to be unable to go many months without the fix of another deal (accretive, as always).

To navigate the fog of the accounts keep focused on the one important number Rusty cannot fudge: FCF per share - which has been in decline for a number of years, and is what pays for everything.

Running hard to stand still - AceofClubs

Who will be left holding the dirty end of the stick of this latest cunning plan? Carlyle will want to make their money as will their clients. The debt holders always get paid first and the equity what is left over (which can be either a good, indifferent, or bad deal).

We read Rusty started in banking and I suspect his ego leads him to believe he can secure the better end of this deal for DEC.; unfortunately, recent history leads me to believe otherwise. Whatever the structure of the financing it is the price of O&G that will determine any level of benefit for DEC shareholders: Carlyle will secure the level of benefit for themselves and their clients and that will not be any bargain.

AceOfClubs

Each Class B shareholder is entitled to nine votes for each Class B Share held, subject to any restrictions on total voting rights as set out in the Company's Articles of Association. Class B Shares carry no rights to distributions of dividends except on distribution of assets, up to their nominal value, on a liquidation or winding up. Class B Shares are strictly non-transferable, non-tradable and non-distributable to any person or entity whatsoever.

AceofClubs

May just aid the quality of your posts? Even if it results in a brief brake on the quantity!

AceofClubs

"If you've taken a 50% haircut then that's because you believed that a US licence would be good news, because that's what everyone else ii's/pi's thought."

Not so: see my post of 10 December 2024 - "It will easily turn out to be just a certificate to hang on a wall; a bit like the EU licence. "

AceofClubs

I sold out yesterday for a 50% haircut on a small investment and added the meager proceeds to a WISEr investment.

The US licence guarantees nothing other than the expense of running a New York office and US regulatory compliance. Yesterday's rise was a sucker punch from the MM's I rushed into CABP - no fool like an old fool. I make mistakes, but the winners still far outweigh the losers so I keep at it.

CABP is a left over relic from a colonial past; the competition doesn't have that baggage. It lacks the scale and technology that the winners have. Western Union is similarly handicapped by its history.

Not a trader so no interest in that - a takeover may arise but at what price?

AceofClubs

LONDON STOCK EXCHANGE

CAB PAYMENTS HOLDINGS PLC - CAB granted licence for US representative office

Released 07:00:09 04 June 2025

RNS Number : 3032L

AceofClubs

London Stock Exchange:

CAB PAYMENTS HOLDINGS PLC - CAB granted licence for US representative office

CAB PAYMENTS HOLDINGS PLC

Released 07:00:09 04 June 2025

RNS Number : 3032L

CAB Payments Holdings PLC

04 June 2025

Update as expected. Expiry of ultra cheap loans is and will continue to be a brake on faster financial progress. Management know their business but cannot control market interest rates. I expect continuing growth but no real fireworks. Looking pretty fully valued at the moment.

I currently prefer GPE and WKP for any new money - DYOR.

AceofClubs

Not negative broomtree, realistic. Those with a different viewpoint can post the reasons to be cheerful. Not being a trader, it is of no consequnce to me whether the share price is up or down tuppence on a daily basis. I will admit to having lost confidence in the management and that is a big negative for me; but I still try to be guided by the numbers. Do you think FCF per share will be up in 2025 - or DEC will be usefully rerated by the market?

Despite all of the "strong" results the sad facts are the share price languishes at half, and the dividend at a third, of where they used to be. From memory (which is increasingly defective) gearing has never been so high.

Rusty shuffles the cards so often I only focus three numbers now: share price, dividend per share and free cash flow per share. Of these the most important is free cash flow per share. Increase that Mr Hutson; the share price and hopefully the dividend will follow. A bit of back testing told me FCF per share declined in the years 2022, 2023 & 2024. I fear 2025 will be a major decline on the performance in 2024.

The last quarter (unaudited) published financial information was informative to the extent that $51m of cash was used to repay debt. What is given less publicity is the payment of $39.5m for the privilege of repaying debt early! Very expensive shuffling of the deck chairs: and some have described Mr Hutson as a "banker".

"Diversified has strategically taken advantage of the recent strength of the natural gas price curve to add to the Company’s 2026-2029 hedge portfolio and layering additional NYMEX volumes at an average floor price of ~$3.68/MMBtu". With an average realised price of $3.78 Mcfe achieved in 1st Qtr 2025 that has to be a backward step rather than "taking advantage". (1Mcfe = 1.038MBtu). It says nothing positive about the average hedging prices contracted.

One last note on the recent $300m syndicated debt raise. The syndicating bank was DNB Bank based in Oslo. Now I would think a Norwegian bank would be almost last on the list to call for an American O&G producer looking to raise loans with a near 10% coupon? How many turned banks down the option of loading up their clients with any of that $300m?

DEC remains running hard just to stand still and performance will depend upon the gas and oil prices achieved, everything else is very marginal.

AceOfClubs

Https://uk.marketscreener.com/quote/stock/BURFORD-CAPITAL-LIMITED-5668352/news/Burford-Capital-s-business-model-divides-analysts-49232179/

AceofClubs

@DividendNomad - see my post here of 31May 2023.

AceofClubs

Just for a nanosecond I was tempted by the prospect of a 10% yield and a lower average cost per share. However, sanity was quickly restored.

It is impossible to assess the financial performance of DEC owing to the consistent acquisition and disposal of assets. I can only trust the share price, the dividend and the FCF per share. They are all headed in the wrong direction. Even the Oak Bloke, who claims to have enough twigs to make a judgement on the numbers, forecast a decline in the FCF per share on the Maverick deal.

Looking back I recall the "industry leading" output decline rates of 4.5% being used to justify financial forecasts. Now that rate is a bit more realistic 10%. I also recall identifying the FD as a heavy and consistent seller of DEC equity. He's not buying, so why should I? GG has kindly reminded me that Chapter 11 is a far more attractive proposition for company directors than Administration can be in the UK.

I remain an increasingly uncomfortable holder.

AceofClubs

@bubbles59 Cevian Capital said it June 2021 when Aviva share price was circa 550p. And the price today is?

P.S. Cevian dumped their holding a while ago for brighter and better things.

AceofClubs

A few weeks ago now, a friend who is involved in electronic systems design, let out that his management had warned the team off TT Electronics components or assemblies on all new designs. Not a total ban but a strong advisory.

His employer? Airbus.

AceofClubs

"No panic": that's why he is no longer a director with immediate effect. The trading updates are a reflection of the performance of the business; not PR puff. Cruddas is driving this bus and is he still up to it? This business depends so much on the right technology and no longer the right connections. The share price has fallen an awful long way for there not to be significant issues.

AceofClubs

"CFO has been with the company over 20 years in various positions and in his role as CFO since 2023" - which means he knows far more than any of us about CMCX. The fact that after 20 years and as a former director only holds just over 25,000 shares sends a message?

AceofClubs

"The board has come clean" - I don't think so. This BoD doesn't know the day of the week - it's the auditors who have found the rot in the business - how far that rot extends is unclear. The portrayal of TTG as a "quality" but mismanaged business is probably delusional. Bad management tends to infect every aspect of a business in my experience - that's why it is classified as bad.

AceofClubs