The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Can't sell as the stock was devalued so hard.
Apparently due to a combination of the dilution, suspension, and subsequent mass selloff.
I would get around half my average purchase price if I sold today.
It makes more sense and wait for the BPD and NAV to rise.
I basically need a lull where it actually goes up in value for awhile instead of down or straight across.
Actually I am a couple of months away from my fifth anniversary of waiting, and averaging down. No kidding.
(I still honestly believe it can rise, and that I will do better by waiting than by cutting my losses. LOL)
@Brel actually they could have used debt financing against the high value asset.
In fact, they assured investors that this would likely be funded that way. Then immediately did the opposite.
Debt financing could have allowed existing shareholders to meaningfully participate in the so-called "game changing" acquisition.
The decision to sell off most of the company to friends and contacts through private equity financing deals meant that our holdings stayed nailed to the floor -- even during a 300% increase in MCAP.
Pals got effortless profit; original investors only got a 154 day suspension, 300% dilution, stagnant SP, and a Ph.D level class in excuse delivery.
Is it any wonder that the big boys liquidated their holdings the second that they were able?
LOL
Yeah sure, a margin call is causing our troubles. Just like in the movies.
Next week it will be naked shorts, the week subprime mortgages and credit default swaps.
Maybe it was a computer virus that rounds all the transactions down by a fraction of a penny, just like in Superman 3?
I'm glad to see the CEO too busy with ops to spend any time juicing the share price.
Implies confidence in the final outcome.
Also implies no more placings in the works, at least in the short term.
@Tiburn agreed that the market was clearly informed of the drill.
Then left to determine the gravity of what it could mean: Underpromising and overdelivering -- kudos IMO.
Savvy industry types such as yourself were able to combine the disclosed information with public data and extrapolate: Nominally expanding BFU Shannon, but going a little deeper to see if there isn't 30MM extra fcking barrels extra down there.
Everyone else is left to understand the basics: Spudded a well, will find out later what did or did not come of it.
I strongly prefer this approach, and applaud it.
Art is an extremely high functioning operator, currently perfectly in his wheelhouse: Shareholder comms and drilling for oil are what he has done for many decades at the highest of levels.
There are no accidents here IMO.
Those who were around for Liberia remember what happened there: Market decided it was obsessed with a single well, tenbagged the SP before the operator even hit target depth.
Only problem was that the target formation was full of salt water instead of oil, which caused incredible whiplash in the SP due to the pent up anticipation.
Market still does not seem to have forgiven the company for that.
Now we are drilling what could be the seminal well for the company, (note I said "could" because no discovery has been announced, ya f'in fluffers) and the possibilities are barely being explored in pressers or interviews.
Could be oil, TBD, no testing done, TBD, that is all, stand by.
No way was this accidental IMO.
@Shaa no question we are a target for a hostile takeover.
Low debt, MCAP half of NAV or lower. Good cash position. Vertically integrated.
A dream acquisition for any major. A turn-key Wyoming operations position priced at a fraction of its' value.
Need that SP to "rebase" ASAP before something happens.
Because if someone offered 1 GBX, they would be getting a steal of a deal and probably get a yes vote from shareholders.
That would be a sad exit point, given the potential here.
Yeah one wonders what Atomic Guy was told when he was handed his 818,873,319 shares.
They were valued at .355 GBX at the time, and today closed at .345. So no yield but not too bad of a loss either.
Unless he was dumping alongside everyone (<---CALM DOWN THIS IS HYPERBOLE) else when the thing finally came out of "no suspension" suspension after 154 days.
PS Q2 will contain a number of @Tiburn's answers. And Q4 (due mid-Feb) should contain approximately 100% of them.
One other outstanding item that the market is waiting on IMO is positive earnings.
Results published so far do not have us making money, nor are the Q2 financials likely to show anything of the sort IMO.
Complex conspiracy theories about the depressed SP are overlooking this very simple fact IMO.
@Tiburn all correct.
Plus one addition: Update on strategic direction of the company.
Are they planning to grow by acquiring WI in the same jurisdiction, neighbouring plays and assets, entire companies? Exploration plays in Africa?
And do they plan to do with primarily with debt financing, primarily with dilution, or?
Addendum to that: It was mentioned that the debt taken on was "pricey", and would be refinanced for more agreeable terms when the value of the asset had been updated. What is the status and direction of that effort?
@submariner you are misunderstanding.
NOT MANIPULATION: Literally ten thousand posts about the absolute certainty of a positive present and positive future, including stating unpublished current profit situation, unpublished current production, and unpublished timelines of future positive events.
This is of course nothing more than hopeful optimism, being expressed by those who have an emotional investment here and are excited about the prospects. Harmless banter and hypothesis-sharing at worst, by people passing the time.
MANIPULATION: Frustrated hyperbole about an apparent negative situation.
Do you see the difference now?
Positive = always benign opinion-sharing
Negative = always calculated manipulation
LOL
Office would have been stacked to the ceiling with very expensive contract accountants and auditors for a good fraction of a year.
Redoing the books in IFRS for 3+ years, then auditing that work, and preparing financials.
To say "ooh we didn't have time for Q2 though, you know with everything that's been going on. It's gonnae be late" puts a strain on my personal credibility detector.
It should have been possible to accomplish anything, including filing a very ordinary Q2 submission on time. Or even early if they so desired.
Thus earning the trust of investors and avoiding the MCTO, and setting a new standard of reliability for the "new COPL".
Oil beef hooked if I can't figure out why it was done this way instead. I fear we are about to find out.
Even if this is another money-losing quarter, the financials should nonetheless contain continued messages of a) solvency, and b) expectation of continuity. Great news for any share trading at these levels.
Q2 should also firmly establish several trajectories:
-production climbing
-sales climbing
-netbacks climbing
...and...
-cost of capital dropping
-one-time charges dropping
-delinquent receivables dropping
Analysts can do their own calculus regarding when money in surpasses money out, as well as when we can expect a black-ink quarter.
The point being that by all reasonable measures, we are on the verge of converting from "sustained lossmaking" to sustained profitability.
My personal intuition states that the company is in the black today. But we won't have a reporting of that until Q3 is published -- usually around November or December.
All good news, especially for the value investor who is long here. More chances to top up for cheap while we wait. (And wait.)
https://www.youtube.com/watch?v=-pYG1Vbgq0o&t=128s
@Tiburn best post I have seen here in a year or more.
Hypotheses that the bad old days are over due to the lenders being the new masters...turned out to be correct?
Awesome, awesome, awesome.
Best thing I have read in a long time. Well done on doing real DD, from the source material.
Yes, eventually. Salient question is on what timeline.
You are talking about changes to the fundamental infrastructure of energy transmission and consumption in the first world; the life support that create and sustain the economies and lifestyles on which billions depend.
This type of transformation is measured in decades, not years.
If you think otherwise, drive down to your local government office and watch them plan...anything.
EV charging is a hilarious one. Put an EV in every second garage in any residential neighbourhood on the planet and you will brown out the regional grid.
Phase out gasoline and put two EV's in every garage? They will be paperweights for a decade or two while sufficient generation, transmission, and distribution to charge them gets built. The energy required to charge a fleet of EV's is a round number multiple of the current capacity of any grid on earth.
"Refuel" / recharge an electric widebody airplane for it's next flight during the 90 minute turnaround that is required for profitability? You would need a nuclear reactor at every major airport.
Commercial shipping? LOL
The list goes on to infinity.
Yes it will happen, no it will not happen the way the world switched to smartphones -- with a massive viral pivot to the new way due to it being the latest trend.
"Green now has a lower cost per watt" is a non sequitur. This is an operational project, not an academic exercise. Cost per watt is literally the least important consideration.
@panama That's what I think. I am here as part of a macro play that I started working in 2016.
I think the entire sector became undervalued, and the key is to pick survivors and keep your powder dry.
This seems to be coming to fruition now, incrementally.