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I would imagine plans are already afoot to replace the CEO, the share price has halved on his watch and the Divi surely has to be cut?!
Bought a few, generally always somewhat premature so will be buying in stages. 8% Divi in 6 weeks so some protection there and at now at multi decade lows.
Hi Fernan, I’m not a regular poster on this site but have always enjoyed your detailed analysis, something that is missing on a lot of boards that I peruse. I’d be interested to compare notes/spreadsheets on a company you’ve mentioned, obviously I don’t want to clog this board up by asking anything here. My throw away email beatley123@gmail.com if you’d like to discuss.
Your maths teacher should be fired, John.
Has anyone noticed an offload from Catcher lately? Seems like a whilst since one was mentioned on any of the boards that I follow.
Kilgeever, just to keep things in perspective with Tullow:
Tullow's revenue was $300m higher than Premier in H1
Tullow had $401m of free cash flow in H1, Premier had negative free cash flow
Tullow's operating costs are $6 per barrel lower than Premier
Never try and catch a falling knife is what they say, but I've bought some anyway.
As others have pointed out, post deal this will be a company that has 25kbpd of production, 70m barrels of 2P reserves, and even without Fortuna another few hundred million barrels of 2C reserves.
Reading through the previous publications, all the last CEO seems to have done is destroy shareholder value. Cash has been dwindling over the years without anything in return, continuing to embark on exploration and the purchases of new licences sounds great, but not great strategy when the market isn't valuing discoveries. It's no wonder he got the boot, particularly considering the share price performance.
Alan Booth has a good track record of delivering shareholder value, so would be happy to see his appointment becoming permanent.
Robbie, any successful investor would recheck their numbers if someone was telling them they were wrong. You’re making a fundamental mistake, but still attempting to advice others. Utterly bonkers.
Thanks ROS1
6. (...and most importantly), I picked up the phone and IR answered my question quite categorically. (Why I hadn't done that prior is perhaps a different question, but I had hoped that someone would show me the error of my assumptions).
Hi ROS1, could you please share their response?
Robbie11, your figures are wrong. Premier produces oil and gas, at $65 revenue would be roughly $1.6bln not the $2bln you're getting before you deduct $500m of OPEX.
Check the last set of results, multiply production by the realised oil price and you'll find a massive discrepancy between what you're expected at what the revenue was. Gas per BOE equivalent has a lower value than oil.
Thinking about it logically, surely they should have been using the forward curve to anticipate what the debt reduction would be, so yeah probably higher than the current oil price since the recent falls.
I'm going for $70, but who knows. Investor relations might be able to shed some light.
ROS1, I've had a look at this and have been scratching my head a little. What I did notice is that the current liabilities substantially increased during 2017, trade and other payables were up by $160m alone (pg136 of the results), if that has reduced somewhat within H1, then it would explain the lack of debt reduction so far in 2018.
Premier have stated that their debt will be 2.5x EBITDA by the end of Q1, anything under 3x is generally acceptable for an oil company. With the option to monetise Zama next year, debt is manageable at these oil prices imho.
Hi Robbie, you need to factor in the mix of Oil and Gas, as $65 oil your revenue figure would be much lower than the one you're using for your calculation.
Hi All, has anyone tried to work out what the free cash flow for 2018 will be?
I've tried, but came across a few unknowns.
- Kraken FPSO not being at full day rate
- Magnus, no revenue but I'm assuming they're paying their fair share of the extraction costs?
- Production sharing agreement in Malaysia, how many barrels do Enquest not get revenue for?
- CAPEX run rates not given to investors
- Net debt situation at end Q1 unclear (cash and undrawn facilities so assuming debt went up?)
Maybe investors should be looking past this year, but interested to know if someone's gone to the effort of working it out?
Just on the debt, the ETS pipeline sale should complete by the end of the quarter so would expect an RNS within the next couple of days.
Agree with Biffa about PMO’s fundementals. Oil prices are still the unknown variable, but with Venezuela, Iran and Libya there’s certainly lots to support current and potentially higher levels. The debt noose around PMO’s neck is starting to loosen, I would imagine we’ll see another $100m in debt reduction in this quarter (we’ll find out soon enough), then up to another $400m by the end of the year. 2019 looks betters still. With the lower price hedges dropping off, a full years contribution from Catcher and potentially reduced capex requirements, net debt in 2019 could fall quite dramatically, particularly if we include the potential monetisation of Zama. From a shareholders point of view, the equity valuation should increase substanically over the next 18 months as the debt levels continue to reduce.