Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Cont.
'Good progress is also being made with non-core asset disposals, with non-binding offers received for the Group’s share in the PM304 Production Sharing Contract (PSC) in Malaysia, the process for which could be completed in Q3 2024. Offers are in line with the value of anticipated cash flows (subject to oil price and oil premium assumptions) over the remaining term of the PSC which expires in September 2026.'
https://www.petrofac.com/media/news/delay-to-publication-of-2023-results-update-on-restructuring-and-trading-update/
From the company website
'The Company expects a short delay in issuing its audited full year 2023 results, which it now expects to publish by 31 May 2024. Although the audit is substantially progressed, the Company and its auditor require additional time to complete the annual report.
As a result, in accordance with the Financial Conduct Authority’s (FCA) Disclosure and Transparency Rules and Listing Rules for the publication of audited financial statements, the Company has engaged with the FCA, and trading in the Company’s shares will be temporarily suspended from 7.30 a.m. on 1 May 2024 until its full year 2023 results are published.'
'As part of the Group’s ongoing financial restructuring, an ad-hoc group of senior secured noteholders have made a proposal to provide further credit to the business of up to US$300 million, comprising US$200 million of new funds and US$100 million of credit support to help secure performance guarantees for certain of its existing contracts. This non-binding proposal is dependent upon, amongst other things, the Company securing these performance guarantees, and would require the conversion of a significant proportion of the Group’s existing debt to equity.
The Company is in active discussions with credit providers to obtain the required guarantees, which would also release over US$200 million of collateral and retentions, and will provide an update on the outcome of those discussions as appropriate.
This development comes as the Company continues to manage its payment obligations to preserve liquidity whilst progressing the other components of the restructuring with other stakeholders.
The Group’s upcoming payment obligations include amortisation payments due on the Company’s bank facilities and the coupon payment due on its senior secured notes on 15 May 2024.
The Company’s lending banks have agreed to a number of rolling short term deferrals of contractual amortisation payments while the Company progresses the financial restructuring. The Company continues to engage with its lending banks on extending these deferrals as required.
The Company does not expect to make the payment of the bond coupon on the due date of 15 May. The payment has a 30-day grace period. The ad-hoc group of noteholders, representing approximately 41% of the outstanding notes, has entered into a forbearance agreement with the Company, which provides an assurance that those noteholders will not take any action in respect of the non-payment of the coupon until at least 30 June 2024, in order to provide time for the Group’s financial restructuring to be progressed. The Company will seek to engage with other noteholders in the coming weeks.
Managing these payment obligations is of critical importance to the Company’s ability to maintain sufficient liquidity in the short-term while it is working to implement the financial restructuring.'
*wasn't
Oh well no more emotion
'Capital Allocation review would take place in May'
The detail in the rns says 'option'
The story still reads like growing off a lower base.
It's a flippin pension scheme that just realised it was being commercial all these years.
Who knew?
At H1 update Nov 2023 MDV said she was very pleased at the strength of the VOD balance sheet and said it was 'remarkable'. '...recognising net debt with a very long maturity on average 11.7 years and interest attached to it of c.2.5%....'
Maybe need some integration and operations capex, but not aware of new spectrum requirements. The network will throttle 'excess' usage and in the meantime big data packages widely available to consumers at competitive prices.
The challenge will come when suppliers manufacture data hungry *G products and more than the current actual/ theoretical capacity or the merged entity really does take all the market share off the other operators, unlikely though.
Anyway, €2Bn dividend off €60Bn net assets is a reasonable return on equity surely?
Well roofer, 180 for 2024 please.
We might even see 220 if the stars align.
Happy New Year
NOFEAR,
I imagine it's the general election in June. The EU has already approved the economic principles. As UK has brexited EU to avoid the beauracracy, I cant imagine a delay is to extend the notion of a bureaucratic gravy train. More likely a stalking horse for a trade deal that specifically meets UK PLCs economic principles and specifically benefits its voting citizens as well as the welfare of all UK citizens ( ..and consumers..).
The remedies will likely be known by sept 2024 and deal could be approved by parliament now in principle.
Exciting year 2024
Interesting.
Thanks NoFear
VOD Topco net assets stated as €64.5Bn @ 31 March 2023. No reason to question that when 3rd parties are competing to own different sub groups of those assets. Yet the SP doesnt reflect it and is churning away.
Breaking up the group maybe the only way shareholders get their investment back u less the Dividend is maintained.. Sell Africa to E&. Italy to Swisscom, India now the SP recovering, Spain on it's way...
By xmas looking less likely..
Swisscom, UK/Switz trade deal and financial services all to play against Illiad proposal. Perfect storm or storm in a tea cup?
Still believe £1 is right but need to see what swisscom actually proposing. Illiad writing is on the wall. Cash, cash, cash....but what is the horizon value if all this is a pause in interest rates, pause in inflation etc.
Amazing really. All this money chasing ownership of the VOD estate and the SP at historic lows.
Roofer, I will go for £1 please lol
Scratching my head how this relates to financial performance. Reread the H1 transcript and the slides looking for the risk I missed. Nothing indicates they will miss guidance.
Working capital is covered by spain cash but numerous initiatives already landing to roll forward the operational and financial base.
Debt profile and repayment relatively easy over next 18 months.
Think I agree with Poker and put it down to option traders this week. I topped up, groan :-)
'Even with a significant cut in the dividend, a buyback might be cost-effective and it would still give a shareholder return.'
The dividend is less attractive to me as personal tax is rising across many investment products. A SP rise in an ISA even with dividend still looks ok.
My £1 by christmas is unlikely LoL but you just never know ;-)
Shorts taking in each others washing
Last one at the bar pays the bill imo
Well missing guidance is priced in surely.
Going concern not priced in imho
Everything is going south at the moment. VOD relatively less so imho..
'dead cert'
I guess the opportunity is the €150Bn+ assets that can be sold to realise cash, pay down debt etc.
Think Mesh mentioned just 1 broadband country sale can realise €8Bn and Vod has at least 5 or 6 countries like that. Spain might be proof of concept. Of course they cant sell all the family silver but they have so many options and flexibility and time to ride out higher interest rates.
As you say, lower interest rates will make cashflows more attractive and i imagine will have PE salivating. MDV might not be interested by then. e& obviously interested and might take the emerging markets business/ Africa (ex broadband).
Seems to be support at 70. August options expiry also so maybe the bottom is in?
Fundamentals depend on H1 confirmation. No reason to think revenues and earnings are going to disappoint with indexed plans in play and JPM reporting on Spain options at the moment to underpin the FCF/ outlook.
Crikey over 150Bn assets to play with and 11% dividend
Think we just need interest rates to pause or even pull back and VOD will tick up to 80p
Anyways, who cares as long as MDV keeps the FCF/ div going in November with E& supporting/ hoovering up these low prices