Member Info for chilting

Jimmyroyal
I guess that's because Ocado is in the growth phase - all the income is to come - so the threat of higher interest rates, if they became a reality, would have a larger impact on earnings.

So far though its all just talk that has knocked sentiment.

Ammu
I brought back in on the 28th April - I did mention at the time.

Moody's are always super cautious - remember there assessment of a company is as a credit agency, not as a broker.

The point about refinancing is what you would expect them to say, alongside their caution about oil prices.

Its the other points that they raise that are important and they should be addressed by AB alongside the refinancing, because the medium-long term future of Enquest is still unclear.

Entirely agree AllAtSea.
Its just a change in sentiment, the same as we saw back in early March and for the same reason, a fear of an increase in interest rates.
It will soon reverse.

Tech shares are still falling this morning, its looking like a rerun of what happened in Mid March.
The fear of increased interest rates, instigated and then retracted by Yellen, still seems to have spooked the tech market.
I guess we just wait for the reverse, its all just sentiment.

This is the relevant text from Moody's

" The Caa1 CFR assigned to Enquest plc reflects its high leverage and the likely need to refinance $335 million amortization due in October 2021 that Moody's is uncertain that the company will be able to repay from organic cash flow generation, especially in a low oil price environment.

The rating also reflects the limited size of the company and its concentration of assets and reserves in the mature UK North Sea, only partially mitigated by some assets in Malaysia, and the moderate 2P reserve life of the company, underlying the company need to bring new resources to sustain production in the medium term.

The rating is supported by the company's robust operating track record as an efficient independent UK North Sea oil and gas company and by relatively benign industry and regulatory environment in the UK and Malaysia."

It does seem to backtrack regarding the reserves and makes a new point about the size of the company.

Both these points are relevant.

Although AB has gone a long way to resolving the reserves issue, it is by no means clear, so far, that current production can be maintained over the next 5-10 years.
I still think that a merger between Enquest and another oil company with AB keeping control would be the best option for the medium-long term.

The site is a perfect 24/7 location because it has no residential neighbours.

The ban is only a political statement, it will probably never be implemented, the market must decide.

Not quite good enough today it seems - the gasoline number messed things up - but its only a matter of time before Brent tops $70.

For Moody's to upgrade, Enquest had to do two things -
De-risk the debt - pending.
Increase the reserves - already achieved with Magnus, Bressay and Bentley.

So as soon as AB sorts out the finances, Moody's will I think give the green light to re-rate the SP - all we need now is for Brent to carry on going up.

If everything does to plan 40-60p is certainly achievable.

I am very content just to sit back and let things happen in their own time - I have now top sliced all my original investment so can now sit back and watch.

Or a bulk shop at Aldi.

AJP
I think we will probably see some volatility but with the SP staying around this level over the coming months - only news will move the SP upwards

This is a very familiar situation Kraken.
Everything depends on the unpredictable EIA numbers at 15.30 BST.
We will certainly get your 18p if they are positive and Brent above $70.
By the end of the day Brent could be back to $65 or riding high at $72.

We probably won't get an update until July, but hopefully we may get more news before then, although most day to day sales are small scale and confidential.
It would be good to hear some news about product development particularly bio plastics and maybe other new products.

Yellen has retracted her comments, re interest rates, so we should see a rebound today - CWR is a massive bargain at anything below 1200.

Market seems to be in recovery mode this morning and should pull OCDO back as the day goes on - anything below 2000 is a massive bargain.

Regained 18p with ease.

Possibly some of the shorts took advantage of yesterdays slide and cashed out - very opportunistic - with the NASDAQ seemingly stabilised, we could see a rebound or at least a flatline.

Will Brent top $70? - EIA numbers due at 15.30 BST - US data is always random so we will have to wait and see.