RE: I read IF there is another lock down in the UK >>>20 Jul 2021 13:01
Smithy, my granny was telling me the other day there's a vacancy down her community centre for a bingo caller, and I told her I know just the man. Perhaps we could get Peewee Boyd to fill the cabaret spot that has also arisen. My shares might have fallen, but I've been blessed to read the searing insights of two of life's winners.
I've been looking at previous results since they bought SASA, and the strongest I can see are the 2018 Interims. Comparing them with the upcoming H1 results for 2021, metal prices for 2021 are significantly higher than H1 2018, but I don't see the EBITDA figure of $64.6 of HI 2018 being higher in H1 2021, due to higher treatment charges. The big difference is net debt to 30.06.18 was $125 million, and for 30.06.2021 it's $10 million, which the market chooses to ignore. Q3 always has the highest production numbers for CAML's metals, and with prices still strong(even taking into account the various hedges in place) CAML's Q3 should easily be the most profitable in its history. A new treatment charges contract was signed on 01.04.21 which is 30% cheaper than the previous one which should help, along with rapidly falling interest costs. I have a core holding here but have been trading the stock continually. I bought at 274 on April 20 and sold at 286 on April 27, when metal prices were lower than today, and bought another tranche recently at 264, which looks like I won't be selling anytime soon. The share price is mystifying, I note that Covid has spread quite quickly in the regions CAML operates in, but the company said in their most recent trading update there were no cases, so fingers crossed. GLA
RE: Do we think this is the bottom now?15 Jul 2021 12:22
Looney came out with more flannel yesterday in his Bloomberg interview. His 'everything is tickety-boo and investors are increasingly warming to my strategy' outlook is partly responsible for the share price reaction today. His credibility is plummeting, oil at 73 bucks, a share price under 3 quid, he has some neck. It's getting to the point where I can't even listen to his voice, as it brings me out in a rash. This is just for starters, it will not be until the end of the decade until there is a meaningful contribution from renewables, for the next few years as they grow the business, it will make a substantial loss. Looney has had 17 months in the job, the market has delivered its verdict, when will the BP board? I am so dazed and confused by Looney's strategy that when I heard BP had bought Thorntons, I thought it was the chocolate retailer.
The main prop for BP's share price is the oil price, and when that starts to wobble the share price plummets , even with oil comfortably above 70 dollars a barrel. The institutions are not buying BP and the much heralded $2 billion share buyback in H2 will not change anything except that the shares will yield 5% instead of 4.8%. Looney has been given carte blanche to restructure BP and its fine punters on here agreeing with it, but the next time oil hits $35 a barrel and the share price is eviscerated they won't be so sanguine. Sometimes I think this is just a nightmare. It was only Feb 2020 that Dudley increased the dividend, and if he had stayed on the BP of today would be in unrecognisable from the car crash now taking place. He would have held his nerve and the dividend, he would have made select asset sales, not panicked like Looney and sold a 20% stake in its Oman business, a decision that grows dumber by the day. He would have committed BP to substantially reducing its carbon footprint by investing in CCS and hydrogen, not investing billions in solar and wind. BP's shares are fairly priced, 5% for a company in the dangerous oil business is about right. Only the other day there was a headline about an explosion in the Caspian Sea. This time it didn't affect BP, but there is always a next time in the oil game.
This is now a 3 quid share. Investors will have to wait until the latter part of the decade to witness any meaningful return on its green investments, which in 2020 produced 33,000 boe a day, which is diddly squat. Only oil at $68 is keeping the share above £3, Looney has sold over $13 bn of BP's assets the last year and waved goodbye to hundreds of millions of profits. What is BP's place in the oil and gas industry. Chevron have started developing the ultra deep Anchor field in the GOM as new technology makes it viable. BP has similarly placed fields, Kaskida and Tiber, multi billion barrel assets in the Gulf. BP was once a pioneer, now its an also ran, a rudderless ship with a CEO destroying shareholder value.
One of the reasons I invested in CAML was its ultra prudent management. You can't have it both ways. The market doesn't fancy it much, but I view it as a rock solid 5% yield, catching some of the upside in metal prices along the way. I've had my fill of AIM punts with dodgy management.
RE: RNS - commencement of buybacks28 Apr 2021 14:22
The dividend cut leaves BP with a 5% yield at 3 quid. Oil companies have always had a built in yield premium, because you never know when a Macondo might happen. Four pounds gives a 3.75% yield which is far too high for an unproven CEO who is dismantling the business and reconfiguring it into areas where it has no expertise. Looney seems to have a bit of a fan club on here but the institutions won't go near BP until they see evidence of his strategy working. That is years away, until then we face the hard sell every time we visit its petrol stations of buying a coffee, doughnut or one of its renewable egg and bacon sarnies.
RE: RNS - commencement of buybacks28 Apr 2021 10:30
Yesterday's conference call was dominated by buybacks and renewables, with very little on O&G. If you have to continually explain ad nauseam, how the buyback strategy works, either people don't understand it, or don't believe it.
If Looney had announced a 50% dividend increase and progressive dividend policy instead of the convoluted drawn out buyback palaver, the share price would have jumped. With a figure of $4 billion for buybacks put forward, it adds up to the same. I've just listened to the conference call, it's mostly flannel and a tough listen. This quarter their trading division made the right calls, the last one Q4 2020, they did not. Looney's ego will continue to cost shareholders dear.
Just heard Looney on Sky. His accent is like his strategy, all over the place. Going on my gut, the foundations do not feel right here. In his interview he never referenced shareholders once. It's like listening to the head of some cult.
Significant drop in oil production is camouflaged by exceptional performance of trading division and recovering oil price. At the end of 2020 BP was generating 3.3 GW of renewable capacity, that's 46,000 boe, I.e diddly squat. Tens of billions of dollars will have to be spent to reach its 2030 50GW target. As BP sells off the family silver, that becomes more and more of a conundrum. Hope the conference call later isn't the usual schmoozefest and Looney's destruction of shareholder value goes unchallenged.
Buybacks are such a laborious process. The 50% dividend cut last August has really knocked the stuffing out of BP. Looney has to grab the market's attention in delivering shareholder value. A 50% dividend rise and progressive dividend policy would have investors flooding back. The company can more than afford it, and they are still saving over $2 billion a year on the old dividend, that Looney can use to save the world.
CAML's basket of metals is having its best week ever since the 2017 Sasa acquisition. Debt and interest rapidly falling, new reduced treatment charges contract. The company said in April 2020, it was still a profitable business with copper at $4774, lead $1600 and zinc $1800. Today those prices are $9500, $2000 and $2800.