Adrian Hargrave, CEO of SEEEN, explains how the Company is now funded through to profitability. Watch the video here.
PS the below calculation makes zero allowance for any opex expenditure, which would be on top.
Well, part one of any answer is... what are the current liabilities?
There seems to be about £7.5m to pay off (plus interest at c 17%) on the original £12m loan.
Then there's £9m to pay off (plus interest at c. 20%) on the two recently taken out short-term bridging loans.
Then there's around £5.25m to pay off to PF to cover the remainder due on the 49% acquisition.
Those are the big lumpy debts as far as I can remember. So, somewhere around £23m inc interest due?
Presuming production levels stay at 3m therms a month and that gas prices average say 90p per therm over the entire period AND taking into account the effect of the hedge derivatives in place, it'd take ANGS about a year to generate a total of £23m of gross post-derivative settlement revenues.
Feel free to pick your own average gas price forecast over the next 12 months.
Wonder why?
13th December 2021
The Company is delighted to announce that a licensing deal has been completed with a major multinational technology business. Further details will be announced in Q1 2022.
In addition, the Company is also pleased to update shareholders that advanced commercial negotiations to release the value of its remote monitoring DaaP continue. While it anticipated completing these negotiations in 2021, it will now do so by the end of Q1 2022.
Unfortunately, he's still got hundreds of millions of shares left to sell, if he so chooses.
And he may well end up getting his hands on hundreds of millions more, if ANGS again offers (and he agrees to take) yet more shares in lieu of cash re the next staged payment due to PF for the 49% acquisition. That repeat of a "shares in lieu of cash" payment is pretty likely, given the fact that ANGS is clearly not awash with free cash at the moment.
...though apparently never in a good way?
For all that I am wary about this company, even I wasn't expecting SP levels to hit 52 week lows, especially after the successful and production-doubling sidetrack (however late and over budget that turned out to be).
One wonders who know what and what exactly is going on? Sure as I've said several times, that 18 month/£20m refinancing deal would be notably beneficial to the company, but I for one wasn't expecting to to be as crucial as it seems to be... it almost seems to be of life and death importance?
Or has anyone got any other credible theories as to why the SP is at a 52 week low (and in a rising gas price market, however temporary that may be?) I've never given much credence to the theory of artificial suppression of the SP to enable a dirt cheap take-over by related parties, but I'm even wondering about that now...
You can pick your own gas price average over the next 12 months - it's probably worth working out the revenue differentials after hedge settlements at 80p per therm (if you're feeling conservative) all the way up to 120p a therm (if you're feeling seriously optimistic).
Regardless of all that, there's not much happening with this share currently and it seems to be stuck in the doldrums, despite the assurances of some.
As the Stranglers said...
https://www.youtube.com/watch?v=QTIhiyurWEc
As I said, this smacks ever increasingly of delusional paranoia.
I mean, it's genuinely bizarre.
If anyone - and literally anyone - takes a look at the trajectory of the ANGS SP and asks the completely understandable question "Hang on a second - the SP isn't doing what I thought it would. In fact, it's doing the exact opposite. Why on earth is that?", they are immediately jumped on and insulted by the more rabid of the cheerleaders and instantly labelled as a troll or an activist. (Any facts raised will of course be ignored).
BV in particular has got to the stage where he 's seeing anti-ANGS activists literally everywhere with his endless cries of "Infamy! Infamy! They've all got it in for me!" - and he includes in that ever-widening group people who are blatantly obviously genuine holders, but who have merely dared to comment on the crystal-clear fact that things with the SP aren't going the way they'd like. Someone else used the word paranoia - it seems to be very well-chosen.
Rather more unpleasantly, he's now mocking people for having bought in at higher pricing. Here's what he just said this morning to one holder:-
"I do find your 30th June 9.50 reply to me amusing, "I,ve been buying small & medium amounts from Sept 22 monthly" ouch. And I notice the 2p to 3p prediction seems to be getting further away on each output update to get your money back. P.S. don't delete that post before others see you are drowning buying at the high 2's at that time ouch!"
Unpleasant stuff - and especially since back in Sept 22, BV was just as busily assuring anyone foolish enough to listen that ANGS was a sure-fire nailed-on multi-bag certainty. More than a tad hypocritical, one might think...
PS the trouble with the RNS from July 21st that Ocelot quoted below...
...is that the company previously assured that the £7m Dec 22 placing would provide funds to cover "the majority, if not all" of the debts related to the missed hedge contracts.
Here's the relevant text from the RNS dated Dec 19th 2022.
"Reasons for the Fundraising and Use of Proceeds
The Company is undertaking the Fundraising to progress its strategy and the net proceeds will therefore be applied towards:
- Hedge expenditure: £3.3 million. As part of the Company's rolling hedge programme relating to gas sales from Saltfleetby, and due to the late start of production from Saltfleetby, some of the original hedged volumes due in Q3 2022 were closed and new hedges of an equivalent amount, but at much higher prices, were restruck in H1 2023. Whilst the Company had been seeking to defer this liability to include it within H1 2023's commitments and has been in discussions with the hedge providers to that end, it has now been unable to agree this. As such these funds are expected to satisfy the majority (if not all) of the earlier closed hedges."
It now looks crystal clear that the £3.3 million from that £7 million placing actually needed to be spent on something else instead, despite what the Dec RNS stated..
Simple answer.
Getting Saltfleetby back into production cost far more and took far longer than ANGS predicted (presumably unknowingly) to the market that it would
- and -
Getting the sidetrack drilled cost far more and took far longer than ANGS predicted (presumably unknowingly) to the market that it would.
To add to the substantially increased costs required to achieve both the above is the fact that the major delays in both projects caused the first 2.5 months of hedged production (Jul, Aug and 1/2 of Sep) to be entirely missed, causing a substantial derivative settlement debt applying to that period that has needed paying off.
Hence presumably the need for the £7m Xmas 22 placing, and then the first £3m junior bridging loan (mid Mar 23) and then the 2nd £6m bridging loan (Jul 23).
Much talk about mortgages... there's an obvious difference between legal ownership by a party of an asset and a charge on that asset held by another party. Needless to say, the two can happily exist side by side.
@Robday, I owe you an answer to your post of Friday early evening which yes you're entirely right, came as a surprise.
If you have posed that IQ - and I'll take you at your word that you have - then I'm impressed. I'm not sure it'll get chosen as one to be answered by the company and even if it is, I'm not sure that any answer given will be that useful. We'll just have to wait and see.
My view is pretty simple. Everyone's got an opinion on the way things *should* be - presumably based on evidence available at the time of forming said opinion. However, if things stubbornly resist matching the way one thinks they *should* be, then the best thing one can do is to try to come to a further opinion as to why they're not matching one's expectations.
That's actually important. Because without having some understanding of why things are the way they actually are (and why they're running counter to expectations), it'll be pretty much impossible for anyone to come to a view on what needs to change in order for one's expectations to be met.
That's all, really.
One would have thought that any serious PI absolutely should be asking him/herself the following questions as mentioned by both Pactrol and Tygra.
1. Why is the SP less than half it was compared to when ANGS hadn't even started drilling and only owned half the field?
2. Why is the SP less than half it was compared to when ANGS announced the completion of a successful production-doubling sidetrack?
3. Why is the SP c 90% down from the point it was at when the outgoing CEO took over?
4. Why is the company's overall MCAP c. 25% down from the point it was at when the outgoing CEO took over?
All the above questions contain instantly verifiable facts - and Tygra has provided entirely credible answers for all of them.
The cheerleaders will now no doubt respond with a load of desperate smokescreening, jam tomorrow promises and (of course) insults, because they have literally no answers to any of the above. Well, none that they want to admit to.
BV has apparently been having to average down in ANGS, utilising his alleged "other investment profits".... those will presumably be "profits from investments" in other companies that he's never made any posts about. Ever. Oh, unless that one post on UKOG counts.
(One has to smile).
Singhie clearly has a collection of soapboxes - all utterly irrelevant when it comes to ANGS.
Easy enough to answer.
ANGS seems to be consistently churning out around 3 million therms a month. Half of those therms are hedged (at least until Jul 2024, when the hedged amount falls). So they've effectively got a fixed selling price (currently 37.55p a therm).
Therefore ANGS has 1.5 million therms a month to sell on the open market. 1.5 million x 1p? Every penny movement in spot gas pricing changes revenue by £15,000 per month.
ANGS worth £100m? Well...
#1 if that's going to happen, it's certainly not going to occur on Pinocchio Lucan's watch.
#2. if that's going to happen, according to ANGS itself, it's going to take a lot more than Saltfleetby as is to be able to achieve that.
"With production up at Saltfleetby, the Board’s priority now is to identify inorganic opportunities for growth which would provide the route to a £100m valuation." (Answer to IQ, 2nd Jul 23)
From the get-go with CTAG, Amit has always banked on (literally) the fact that it is logically impossible to categorically prove a negative.
As Soyo quite rightly says, whatta guy!
"..watching ANGS grow..."
I wonder what you mean by "grow"?
ANGS's MCap in Q1 2019 when George took over was £34.4 million.
ANGS's MCap today as George leaves is £28.1 million.
BV, not that you could recognise the truth if it slapped you in the face... and not that you're ever bothered about the truth in the first place, but...
I have just the one ID.
I never bought into ANGS at 26p (you're wrong by over 94% there).
Whatever else GL has presided over, he has presided over a c. 90% drop in SP, since taking over the reins at end Jan 2019, when the SP was 7.5p.
More interesting is the fact that two board members (Hans Christian Lucan isn't quite all the way through the exit door yet) are able to deal in ANGS shares right now.
Presumably this means that neither is aware of any inside info that could affect the SP either positively or negatively. Which does make one wonder what's going on with that IMV necessary £20m refinancing package.