Member Info for MartyMcFlySr

Fair enough

I invested some years ago and predicted the top (see previous posts). There is a lot going on to unpack here but the fact there are headwinds is a massive negative. I believe this company is struggling and the CMA will impact corporates and favour independents. Or at least it should. I believe a profit warning is around the corner. Do t forget the cyber attack. A number of the key Board members have left with no vets in place. I’d get out while the price is reasonable. I have no shares here but feel this is time to call it a day if you remain in. Good luck in whatever you decide.

Just read all vet press on the CMA and you’ll quickly see vets are peed off with corporates and their behaviours. He was one of the few remaining vets in a corporate Board room. There are independent vets opening left, right and centre near us. It’s continuing the Dow turn of corporates they’ll be back but it’s decades away.

Drilling programme to start at nearby licence

A farm-out of the Anchois project is not the only newsflow on the horizon. Early next year, Chariot plans to commence a four-well drilling programme on a new onshore Moroccan licence, Loukos.

Located in a conventional, shallow gas play in a basin with a high historic success rate of 80 to 85 per cent and low development costs, it has geological similarities to Chariot's offshore licences, close to existing infrastructure, processing facilities and onshore pipelines for the Anchois gas project. Loukos is well located to supply the industrial offtake market, too, thus offering rapid monetisation of production through Chariot’s recently announced gas-to-industry partnership with Vivo Energy.

Targeting high-graded prospects ranging from 8-18bn cubic feet (Bcf) of best estimate prospective resource potential (Chariot preliminary internal estimates), each well will cost $3mn to drill. A $19mn equity raise in July provides the funding and one that advised supporting at the time (‘A fundraise worth backing’, 12 July 2023). It could be money well spent as McCormack at Cavendish estimates that a 10bcf onshore prospect at an industrial gas price of $11-$12 per million British thermal units could generate gas revenue of $100mn.

Although Chariot’s share price has flatlined since my last article – albeit the holding is showing a 390 per cent gain in my 2017 Bargain Shares Portfolio – it could easily double on a successful Anchois farm-out. Buy.

Bearing this in mind, Chariot’s management team has been progressing discussions with Office National de l'Electricité et de l'Eau Potable (ONEE) to supply gas directly into the gas-hungry domestic market. The signing of a binding gas sales agreement (GSA) with ONEE to supply up to 60mn standard cubic feet per day (scf) of gas over a 10-year period on a take-or-pay basis is critical. That’s because it not only underpins project financing, but it allows additional expansion as the project develops.

Within Lixus, significant volumes of gas can be unlocked through further drilling. Three key prospects have been identified, all of which could be potential future development hubs and have tie-in capabilities with the planned Anchois infrastructure. At Rissana, Chariot’s team has mapped giant prospective plays with 2U estimates of 7Tcf, independently assessed by Netherland Sewell and Associates.

Chariot’s directors are also in discussions with European entities interested in signing export agreements. That’s because Anchois has an additional 45mn scf of spare ullage, of which some of the spare capacity could be used for export into the European gas market through Spain.

End game of Anchois farm-out process

Admittedly, it has taken time to reach this stage, but an imminent 'farm-out' announcement could be a game-changer for shareholders. It would enable the group to recoup some of the $50mn (£39.2mn) spent on the project and materially de-risk its retained interest.

A successful farm-out is likely to be the catalyst for a major re-rating given that Chariot’s market capitalisation of £148mn is less than 25 per cent of Auctus Advisers’ unrisked valuation of $839mn (£676mn) for the Anchois project. The valuation is based on Anchois’ 1C contingent resources of 365bn cubic feet (bcf) and 2C contingent resources of 637bcf. Both Cavendish and Auctus have a 60p per share core net asset value (NAV) valuation, or four times the current share price.

Chariot could soon announce a 'game-changing' deal

Shares in an African-focused energy group would easily double on the announcement.

Farm-out in Morocco close to concluding

Drilling on nearby Loukos licence to start early 2024

$19mn equity raise at 14p in July 2023

TThe key take from Chariot’s (CHAR:14.75p) interim results is that the Africa-focused energy group is close to concluding 'farm-out' negotiations on its flagship Anchois gas development project in Morocco.

Around 40 companies are interested and Chariot has received multiple offers from significantly larger exploration and development (E&P) companies. The offers are based on an upfront cash payment and Chariot retaining a material stake in both the offshore Lixus and Rissana licences, in which the Anchois project is based.

Analyst James McCormack at house broker Cavendish believes that “any farm-out may provide the financing of the capital expenditure to first gas, materially reducing the risk of dilution to shareholders”. However, to provide optionality for the project financing, the directors have lined up a debt consortium of European and Moroccan banks with investment bank Societe Generale.

Importantly, the front-end engineering design (FEED) phase of the project has now been completed, and the environmental social impact assessment is close to being finalised for submission to the Moroccan authorities for approval. It means it is nearing the point of the final investment decision.

I’ve been watching from the sidelines and was surprised to see such a big fall in sp. However, the trading update this morning has tackled the staffing issue head on saying there has been a 9% increase in vet numbers over last year and vet vacancy rate remains stable at 10%. Revenue up 11.4% (yesterday pets at home reported vet revenue up 4% so CVS giving better performance here). A lot to like here at a bargain share price so I’m buying in this morning again.

Another Simon Thompson article tonight post trading. Hopefully will help sp come Monday. Happy weekend to you all. Here are the highlights:

- Memorandum of understanding for offtake agreement with an international energy group for Anchois Gas, Morocco.
- Excess gas can be sold through the European spot market through the Maghreb-Europe Gas Pipeline.
- Anchois gas appraisal well on track to spud in December.

I must be honest and say I’ve just sold my shares and had a fantastic run. This really looks over valued now. My own concern is in recruitment as I have a close vet friend working for CVS and they feel the workload has increased but without a proportionate increase in new starters. Therefore CVS may be right to say they have a stable vacancy rate but this ignores the business growth and you only need to look at recent news articles to see there is a recruitment crisis in the profession. My own (CVS) vet is a nightmare currently as cannot get appointments quickly and staff sound broken when you speak to them - they’re a lovely lot. I fear a CEO with strong a financial background is at sea when it is the people that deliver results in this service sector and he seems to be failing to understand the problems in this company. I’m out but good luck to the rest of you.

Press release from CVC Capital Partners just now saying they’ve bought Medivet, a 300 site vet corporate, for £1bn. Should be good news for CVS ahead of full ur results next week.

CVC Capital Partners VIII has agreed to acquire a majority interest in Medivet, a leading veterinary care provider in the UK, Germany and Spain for an undisclosed amount.
With over 350 branches in the UK, Medivet is a leading provider of veterinary care, delivering a full spectrum of small animal health services including routine check-ups, 24/7 emergency care, lab & diagnostics and advanced surgery to companion pets across the country. Medivet has a clinical excellence led ethos and unique partnership model delivering a gold-standard of clinical care to patients, whenever and wherever they need it. From its UK foundations, the company has recently expanded with operations in Germany and Spain, with ~50 sites in Europe in partnership with local founders.
With CVC Funds’ backing, Medivet will pursue a strategy focused on driving both organic and inorganic growth, while further enhancing Medivet’s established reputation for exceptional care and service to its clients. Benefitting from both CVC’s UK presence and strong international reach, Medivet is poised to continue its growth as a leading provider of veterinary services in the attractive animal health and wellness sector.
Commenting on the announcement, Deirdre Burns, CEO of Medivet said: “I am delighted that CVC has decided for its funds’ to invest in Medivet to fuel and support our ambitions and growth plans for the UK and Europe, and look forward to working together to bring them to fruition. Over the last 34 years, our Central Partners, Branch Partners and all our people have worked hard to build an outstanding business, centered on delivering exceptional care and service to our patients and clients. In the last few years, the management team have built upon these foundations, transforming the professionalism of our functions and operation, and we are primed to continue our expansion – both in market presence and in the depth of our clinical care, service and expertise.”
Arnold Levy, on behalf of the founders of Medivet, said: “It is with great pride that we see Medivet in the position it is today, and would like to extend our congratulations to all our outstanding staff who endeavor daily to make pets’ lives better. Deirdre and her management team have worked tirelessly to build on the Company’s track record in recent years, and to ensure it is well placed to continue its growth in the years to come. In CVC, we have found a new investor and partner who appreciate our industry, our business and its model and we wish them all the best for the next phase of the journey.”
Dominic Murphy, Managing Partner and Co-Head of UK Investments at CVC, commented: “Medivet is a fast growing and attractive business, where we are delighted to be backing the management team, led by CEO Deirdre Burns, to further grow the UK

Another update from ST in Investors Chronicle after hours trading this evening extolling the virtues of the undervalued update from Sandfire Resources and potential from Kalahari Metals. Hopefully will help boost sp tomorrow.

CVS moves from strength to strength. EBITDA expectedbto be marginally ahead of April's upgraded market expectations. This should bounce back today and hopefully will encourage analysts this still has further to go. Leverage down, employment up. Board are continually under promising and over delivering. cant be a bad thing for us. Let's hope the market responds well amidst general inflation concerns.

The now regular pre results rush to buy shares has started. There must be some investors being informed of the positive news that is imminent. Enjoy the ride!

Eye wateringly incredible results from PETS this morning. This shows what CVS are currently sitting on. Very excited for full year CVS results.

The market is warming back up ahead of Pets at Home results being reported on Thursday. Sales within the vet sector are flying so these results will be first indicator of how strong CVS results will be come June. Looks like some people in the know are adding CVS shares currently. Still a lot to like here.

Well here's a nice surprise. Unusual to get a trading update at this point in the year but just a brief one to say sales have increased over the very positive last quarter. Therefore again, sales have grown above the previous level that was already above expectations. Unusual for CVS Board to be so positive so a LOT to like here. Interesting to see what the market makes of this seemingly under the radar stock.

The veterinary sector really is on fire at the moment. This share has some ground to catch up and from recent figures and given other activity in this region a £24-25 price seems reasonable. I'm firmly holding and will add if goes sub 19.

And this..

https://www.ft.com/content/9a825fe8-8ea5-4ef3-84b7-2529bfe5ffed

Still a lot to like in this share.

Lots of big money news in this sector in last 24 hours. MEDIVET is a smaller corporate in the sector that is up for auction:

https://news.sky.com/story/medivet-to-cash-in-on-pandemic-pets-boom-with-1bn-sale-12282470

And that was a good week. There's certainly more to come.