Member Info for epiphany121

Afternoon P - Debt reduction would be key for me and that's where my focus would be. The key questions for me

1. Hedging Strategy to assure cash flows for 2019 and 2020 to facilitate debt reduction
2. At what point would Enq consider additional acquisitions/buy backs? Even dividends - although as KO already said, I'm pretty sure that'll be one of the early questions.to
3. What can ENQ do more to 'sell' the investment story to analysts?

Maybe I'll think up something more as well.. ;-)

Runner - I did get a letter from II (one of my online brokers) just this morning and it's called a letter of representation that confirms I can now go to the AGM and that's for free. That took a couple of days only. As I said before, IG are cheeky sods and they ask for a £100 payment to get this letter.

It's the first time I've ever requested one for a UK company and I hope to be there on that day, my business travels permitting, of course.

Is that some kind of a record, KO - you actually blocked someone in the first place? ;-)

Thanks for the feedback, Chilts.

GK is still hanging around - we can only surmise that the load isn't complete yet and GK is only due to arrive at Scapa on the 4th at 11:00.

Maybe there were offload issues and people on the FPSO informed some traders/PIs of this to mark down the price yesterday? I'm speculating, but it isn't in the realms of improbability.

Chilts - It looks like this load is headed to the Chevron Refinery in Pascagoula, Mississippi

If oil goes to $40...If oil goes to $100...if oil goes to $150.

I's like to think that it doesn't really take a genius to figure out what happens to indebted oil companies at each of these price points - however, it's great that you made a laborious attempt at making the obvious so very obvious.

Runner - I applied for an in-person vote yesterday and I'll let you know how long it took for me to get the invite/letter for the AGM, as soon as I've received it.

My bloody IG.com account needs me pay them £100 in order for them to request my in person attendance at the AGM. That's frikking insane. My II account needs no such payment and I have requested in person attendance from that account. I may be out travelling that day and I'm not sure if I can attend, but I'll attend if I'm able to.

KO - thanks for bringing that to my attention to look up, as I did mean to note and comment on the monthly production stats, which are by far the accurate stats, vis a vis the weekly ones.

Here's some historical monthly production data and generally in February in the past couple of years, there's an increase in monthly as opposed to a decrease this year. It may not be significant, but is one of the early signs that the treadmill may be slowing down with cuts in drilling expenditure.

Let's see what the next few months will bring forth..

Nov-2016 8888
Dec-2016 8778
Jan-2017 8840
Feb-2017 9083
Mar-2017 9140
Apr-2017 9085
May-2017 9168
Jun-2017 9074
Jul-2017 9230
Aug-2017 9244
Sep-2017 9495
Oct-2017 9703
Nov-2017 10103
Dec-2017 10040
Jan-2018 9995
Feb-2018 10248
Mar-2018 10461
Apr-2018 10475
May-2018 10464
Jun-2018 10672
Jul-2018 10936
Aug-2018 11325
Sep-2018 11470
Oct-2018 11559
Nov-2018 11926
Dec-2018 11963
Jan-2019 11870
Feb-2019 11683

Crude +6.81 mm (+1.5mm exp)

Product data isn't out yet, but refineries are apparently not ramped up yet.

Chaps - Adjusted EBITDA would typically be adjusted for any of the below items to the reported EBTDA. We're only talking of an adjustment to the denominator, which is the EBITDA, not to the net debt number. Finance leases can't be added to net debt. Now what's possible is that in line with how Moody's are calculating debt, the vendor loan component is possibly being added back in the Seeking Alpha article in question. I'll try and drop an email to IR and get some clarity.

Non-operating income
Unrealized gains or losses
Non-cash expenses
One-time gains or losses
Share-based compensation (which is a subject of frequent debate)
Litigation expenses
Special donations
Above-market owners’ compensation (private companies)
Goodwill impairments
Asset write-downs
Foreign exchanges gains or losses

Yes, $65.80 is the average thus far in 2019. Q1 average was just under $64 and April's average is $71.5. And we were favourably hedged for Q1 with a circa $70 floor.

DK - where were these details posted? Is this from a blog site?

Statistically speaking, a draw is on the cards and that's my base case for today. ;-)

WTI/Brent have moved up after the UK markets closed. About par for the course too..

You can see that good old FS Cygnus is out next to AK doing a bit of work/supplies. If we do get pushed to tomorrow, it should be because of FSC..

2% probability event, given where the US is with their production levels relative to the last time when oil was at $100.

Afternoon Pelle,

Yes, indeed. I'm not sure what the Net Debt to Adjusted EBITDA ratio being discussed in the SeekingAlpha article is. The denominator - the adjusted EBITDA is the question mark for me.

You're right about the ratios and the number that AB was referring to should be $1774 mill/$716 mill. He was probably being conservative on that count. I already stated here previously that we'll be closer to 1.5 at the end of the year (maybe a bit higher than that), than 2.

Best

Pelle - doping is something I may practice on the odd occasion with a joint, not sure about ENQ as a company though. ;-) Lol...

Having said that, if you read the AR, there is commentary that $50 million of working capital adjustments would be wound down in Q1 - read that as an increase in payables to be wound down/paid back. For example - VAT payable was $24 million as of 31/12 and that would have been paid back. Like you, I'm not factoring lots of net debt reduction in 2019, with the payables being wound down. $300 mill or so would be my number.

Spot on. Can't agree more, Hitman. The only scenario where dividends may come into play, is if Brent gets up and stays in the 80s for long periods of time and certainly well into 2020 H1, and then there may be a small interim div with the H1 results in 2020.

However, I'd say this is a low probability event - maybe a 10% probability event.