Member Info for Jim800

No material impact on extant financial forecasts so maybe beneficial in years to come but not in 23/24.

I’m sure GG knows far more about finance than either the banks who recently set up the credit facility and Rusty and the BoD (who have significant personal holdings) so we should be grateful he’s taken time out from running major financial institutions to share his Chap 11 thoughts.

Or perhaps he was just bored sitting in his bedroom at his mum’s waiting for his PlayStation to boot up.

DYOR but I’d take his with a large pinch of salt.

He’s out (if he was in) so hopefully he’s got better things to do now.

What did village idiots do before internet trolling?

Lots of weasly words about on this.

Refinance in this case = loan.

Performance numbers seem to alternate between plant uptime and output, agree they are linked but probably not linearly.

Think if I was a potential investor / providing a loan I’d be focussed just on output metrics. How much power / heat is being sold out the front door. If there’s a bit of start / stop, tweaking controls for different feedstocks etc, who cares if planned outputs are met? However, if we’re only producing 80% of planned output that’s a problem. Any forecast output should be 100% achievable to encourage investors.

GKP up, Genel up, DNO up - yet no official news!

Blind optimism or something more concrete?

Notrex, the mooted BB was coincidental with a stop to the slide in SP and a move back from mid 80s to low 90s - whether the 2 events are linked we’ll never know.

Although you’re correct that BBs now would save 15% ish over 12 months, a company that just buys its own shares to reduce dividend payments ain’t going to increase profits.

DEC need to keep adding producing assets to at least cover the output declines in current wells else profits (and hence dividends (and hence SP)) will all fall.

Personally I think their advertised quest for producing assets at the right price is the way to spend the money they have seemingly put up one side.

The refinance is good news as it shows at least one bank has looked at the numbers / viability of the MDC tech and decided they are happy to loan against it.

It’s also good on that the money will ease cashflow and prevent yet more dilution by placing.

However, it certainly isn’t income or profit and how Simms can call it payback is ludicrous.

It’s just a well completed loan application that the bank has approved.

AoC - unusually your numbers are correct (although once again you fail to qualify that these are in thousands). However, you fail to add the explanatory notes which paint a better picture.

NET CASH PROVIDED BY OPERATING ACTIVITIES

For the six months ended 30 June 2023, net cash provided by operating activities of $173 million decreased $32 million, or 16%, when compared to $205 million in 2022. The decrease in net cash provided by operating activities was predominantly attributable to the following:

• A turnover in our working capital position of $194 million. reflecting the impact of the rapid changes in commodity markets during the post-pandemic era. During the six months ended 30 June 2022 commodity pricing was rapidly accelerating allowing us to build a working capital benefit of $92 million. When prices cycled back down in 2023 the build up in working capital began to unwind generating cash outflows of $102 million;

• These outflows from working capital turnover were offset in part by a $59 million increase in Adjusted EBITDA as well as declines of $64 million in other adjusting costs during the six months ended 30 June 2023 when compared to the six months ended 30 June 2022. Additionally, our hedge modifications transitioned from an outflow of $7 million to an inflow of $17 million offsetting an additional $24 million in year-over-year working capital turnover.

SP might also be as a result of some pretty crap reporting.

Terry's previous link has a hyperlink to 3 DEC warning signs: under that is some complete and utter garbage about them not being profitable so only assessed on Price to Sales ratio and that they should be profitable in 3 years! The next bit is a direct quote - again utter rubbish. Doesn't take much to scare some people. As per the old adage we just have to stay solvent longer than the market stays irrational - the Div helps that. :-)

"Diversified Energy's earnings have been declining at an average annual rate of -76.2%, while the Oil and Gas industry saw earnings growing at 16.8% annually. Revenues have been growing at an average rate of 48.6% per year."

Interims were really only business as usual so not surprised market hasn’t piled in. If they didn’t like it last week there’s not much to change their minds this week. Though for holders who like the model there are lots of marginal gains to be seen.

More interestingly, Rusty says:

“ We believe that significant opportunities through outright sales, advantageous joint ventures, or other partnership constructs will provide a catalyst to unlock our net asset value upside and drive organic, no-cost production growth”

So he looks like he’s got something up his sleeve for SP.

Not sure we can win on the results.

If gas spot price was high when accounts were finalised we get better future hedges but the difference looks like a loss in accounts.

If gas spot price was low we make more profit but get worse future hedges!

Perhaps delay in results was due to BoD waiting for a daily drop in spot price to minimise “apparent hedging losses” in accounts.

You wouldn’t want to finalise accounts and do hedging on the same day. Tricky!!!

Lagging the wider market 3 days before xd!

Is lack of interims, or at least a trading update scaring the market?

Jz - depends on your definition of a partnership. Neither shell nor BA ever chipped any money in but said they might be interested once the saf was a realistic proposition.

Other posters have said for years that VLS have t the commercial / financial skills to get a large facility up and running - seems they were right.

Additionally think the BoD would be against a hostile takeover - they’ve all got a lot of shares and presumably think share price undervalues company at present. Think Rusty also wants to prove his strategy is highly profitable.

An agreed merger might be more attractive to them (under the right conditions) but carrying on til the markets recognise cash generation seems best course of action to me.

Something afoot - trades have picked up last few hours and now SP up 6% against a falling market since 1100 ish.

Someone has the news before us mortals.

There isn’t a “relationship” between BA (or IAG) and VLS.

They merely signed a non-binding offtake agreement years ago in the hope VLS would produce significant quantities of SAF.

They now realise this isn’t going to happen so have switched to more credible suppliers.

Massive re rate alright - Shame it was downwards and wiping out yesterday’s gains.

Not only party political but also a load of rubbish!

They infer the Conservatives brought in the windfall tax and no other Government would have. Every Labour interview I have seen implies that if they had been in power the windfall taxes would have been more widespread and more extensive.

Of course the Conservatives brought in windfall taxes - they were the only party in power.

If that's the level of your contribution KoK then please stop.

See RNS dated 18 May.

A 14 bank syndicate have agreed terms for a $375 borrowing base. And that was after due diligence of the suns -so they’re happy FCF can repay that ok.

Hopefully they’ve learned their lesson on raises now!

DEC are always going to be chasing value accretive acquisitions - that’s the business model.

Char, once again you make absolutely no sense.

If you’re certain that markets are due a sell off and shell will soon be at £21 why aren’t you selling up to buy back later????

Insanity!

Andii, Thanks for replies.

My view (as you asked) has been constant for last 18 months. Happy with the tech and confident there’s a huge market out there BUT do EQT have commercial, project management and financial competence to bring all the disciplines together whilst managing cashflow.

Idex deal was a great initial step but it’ll take a timely, profitable Italy MDC refinance to make me add more.

But happier today than I was a month ago.