Member Info for Clickit

The other good news:-

This contract award forms part of the US$1.5 billion of opportunities described by Petrofac as being at preferred bidder stage in its December trading update.

Asfari’s holding is the difference. Can’t see any t/o without his compliance. If he’s underwater; convinced of better future SP; or wanting significant divis then a t/o is highly unlikely ‘anywhere near’ - only he knows how that’s determined - current SP.

Asfari’s holding should give confidence to PIs (and a reason why I’m LTH).

Empty cans make the most noise

Poker.. totally agree.

Managements review of the portfolio of contracts etc took:-

“… a cautious view of the quantum and timing of recognition of certain revenue claims that would have partly offset …”

(now anticipated) increased costs predicted to result in

“a full year Group EBIT loss of approximately US$150 million to US$170 million for 2022….” of which “approximately 50% of these additional costs are expected to be paid over the remainder of 2023, with the balance spread over 2024 and 2025. Any future recoveries from clients would mitigate this outflow”.

This is a deliberately pessimistic statement highlighting costs but playing down income generation and timing of receipts.

Significantly, as you say, loss will be spread and potentially offset by future income streams.

25th will be much more positive, IMO. Let’s hope so!

Companies, typically, put out releases (such as this one) before a results meeting so that the ‘bad news’ doesn’t taint the EoY result forum and the new CEO can (1) say, ‘not me, Gov’ (it was my predecessor that did it) and (2) paint a rosier picture going forward from a lower financial base.

In future, if all goes to CEO’s plan, he looks good and so does his bonus…

RC - as always, good sense.

I’ve worked with turn-around CEOs for years.. and this statement (before the incoming CEO presents Y/E statement in a couple of weeks) is typical.

If there is a the reason, in the new CEO’s opinion, to take a more pessimistic view on his / her new ‘baby’ then the time to report to investors et al is ‘as soon as he / she gets their feet under the table’. Now.

So this release - not the quantum but the ‘realism’ in financial assessment of the company’s affairs - is entirely predictable.

Why …. because, if the new CEO gets it right (in terms of an effective / positive turnaround) in the next 2-3 years (as he expects to do or else he would not have left a good position to take on PFC’s transition) - that will be his timescale - he will look good on his CV (for future such CEI positions) and his bonus structure will reflect (handsomely) that turnaround.

So, whilst disappointing (from a headline news) I’m expecting there to be much that is positive both in the Y/E report (25th) and coming months that will see the SP move up.

Others have talked on liquidity / debt but whilst relevant / important, substantial contracts with worthwhile margin is where the new CEO will be concentrating.

Take comfort ….

PS Shorters will know this and be taking this opportunity to f.o. in the short term.

Anyone got visibility on the MEED report ..?

And, with burgeoning upward wave since ATL, FOMO is taking hold….

And, we all take comfort from D&Os buying shares in significant quantities. They’d be unlikely to do that if they were not confident.

Stocktrade…

Tried to top up (a few thousand) at 77 yesterday. Got nothing. Tried again at opening at 79. Got nothing.

Hmmm

Hope you’re right, Mary. John Burford (chartist) guiding that a major crash is imminent.

Paddy - I agree but I thought that previous ATL (91p) was just that so, quite surprised at this level.

But, this SP has a habit of racing up and down so IF 81 is the bottom, wont take long for SP to be out penny share.

Same story though : we’re all waiting for the big contracts to land and whilst interest on net debt may be growing, the backdrop still is of the need for more O&G production required in-spite of current lower OP so, unlikely that PFC will not grab a bone or two. Just that client decisions are still being delayed….

Keep the faith.

Paddy - one half decent revenue contract and shorts will have jitters. And when that RNS arrives - it’s when not if (otherwise Asfari, Azvalor etc would not have their funds invested) - then SP will fly up.

Which is exactly why shorts will / are getting jitters (as Mary says).

It just a question of timing i.e. in H2, 2022 or 2023.

And, a standard stay period for CEO is 3-years. Sami will be gone in over 2-years but that’s not so unusual.

IMO he was a bit too free with information on minimum contract bidding margins (which might have assisted the competition) but also, they may be others that better fit the required CEO profile. Just because someone has performed in another role within the company, doesn't necessarily make them cut out as a CEO.

TK may (or may not) be a better fit for the role that PFC board require. Time will tell.

But, Medori is well regarded (albeit won’t be around too much longer) and Asfari’s no idiot (and must still be influential).

The current SP malarkey seems well overdone on the back (so far) of no large scale backlog additions; Schroders reduction; and opportunist shorters.

Give it a month or two and all those that have had the fire power to add will be sitting pretty.

That’s my take FWIW anyhow…

Glad to see you’re still posting on PFC. Any news on the Colonel?

Pokerchips - good post. Very comforting. Sound investor. Just what’s needed to calm current SP jitters.

Surprising for the Sami RNS not to be accompanied by a steady as she goes trading comment (as SP fall was inevitable without new contract releases).

Fingers crossed for 20/12/22 TU. What Sami has to say will be worth a listen….

We’re in a short term bear market rally phase…

JG - as frustrated as you but correction : Sami was bullish on Q4 (not H2) 2022 and 2023 and we are less than 1-month into Q4, 2022. Hopefully, not long to wait for large contract win to land…..

I needed a confidence boost…so reviewed a previous post on Sami’s 11th August 2022 podcast in which he said:-

(1) Reputation of PFC is completely rebuilt. No ethics / compliance issues raised by any customers.

(2) 7bn bidding pipeline due for award in H2, 2022 but unrealistic to see all awarded but a significant amount - say, 66% - may be awarded.

(3) in some bids, PFC down to the last 2 bidders.

(4) PFC is in a ‘very good position’;

(i) ‘confident’ that PFC will grow the backlog ‘significantly’ in H2, 2022;

(ii) expects 2023 to be ‘another very good year’.

But, PFC can’t continually ‘move the needle to the right’. At some point, contract awards must be achieved which needs to be soon and demonstrated in the next couple of months.

I’m still holding … expecting great things from PFC despite **** elsewhere….

Barny - I did the same.. needed a confidence boost…

A few things worth bearing in mind from Sami’s 11th August 2022 podcast:-

(1) Reputation of PFC is completely rebuilt. No ethics / compliance issues raised by any customers.

(2) PFC ‘on a journey’ in which:-

(i) bidding discipline requiring 6-8 % EBIT margin will be maintained;

(ii) backlog growth in 2022 & 2023 fundamental.

(3) no wind related awards anticipated until 2023.

(4) Hitachi collaboration relates only to Tennet multi-billion award opportunities in which Tennet wish to ‘get started’ in H2, 2023. Competition : Siemens and GE.

(5) 7bn bidding pipeline due for award in H2, 2022 but unrealistic to see all awarded but a significant amount - say, 66% - may be awarded.

(6) in some bids, PFC down to the last 2 bidders.

Sami - summary:-

(i) PFC is in a ‘very good position’;

(ii) ‘confident’ that PFC will grow the backlog ‘significantly’ in H2, 2022;

(iii) expect 2023 to be ‘another very good year’.

But, PFC can’t continually ‘move the needle to the right’. At some point, contract awards must be achieved.

As you say, that needs to be soon and demonstrated in the next couple of months.

I’m still holding … expecting great things from PFC … despite Putin and co.

Fingers crossed….

Paddy - good to see you're back posting.

Agree with you : just watched podcast. Sami could hardly contain his excitement about new contract awards potential. Makes me think there one or more decent awards around the corner….
For anyone that hasn’t watched the podcast in full, well worth a listen…..
Fingers crossed…