Member Info for miles44

@Pokerchips well the whole investigation is in fact an outflow of the Unaoil investigations, so yes, it came via Unaoil I guess. And as for your second question: if he was ordered by someone or not only would matter for the amount of a fine. As you said all even theoretically involved people have left PFC.

Adding to another post here: in many western states, bribery in foreign countries wasnt a criminal offense in the past, it only became so in the late 1990/2000s. Formerly one said that in many countries, corruption and bribery is just a - not good, but normal - way of doing business and that it would hinder the national companies business to criminalize it in other countries. This changed as I said and many companies then had scandals of continued bribery as of course companies from other countries continued their bribes as well and clients were still demanding it. This of course doesnt excuse corruption at all, it just means that having to deal with clients demanding a "favour" was and partly is a common thing in some countries unfortunately and today all companies have codes of conduct and control mechanisms for this. So a single employee or some ignoring these and acting together with another company doesnt necessarily constitute the responsibility of the employer.

So yes, I agree, we ll just have to see what happens in the next weeks, but it seems to me things are coming to a conclusion finally. This alone will free the way for the stock price to grow again.

@Pokerchips - haha yes, that would be a nice move as a new CEO - to buy shares today. Not only to promote your reputation but it could also make him some nice money.

You re right about the late court appointment: they decided to sentence him only now as he s pleading guilty which means that his lawyer and the SFO have very probably made a deal - does it mean that noone else will be prosecuted? Not necessarily but it means that the SFO now knows all they can know from Lufkin. He - as a source of information - is "dry" now. As a matter of probability, I think that - being advised for about 4 years by lawyers now and certainly having done internal audits plus cooperating with the SFO of course the company now as well should KNOW what was going on and if and to what amount they are involved. And the new CEO would not have accepted the position if there would be any major problems, no-one would start his CEO career if it would be doomed to fail anyway.

So I m optimistic: the share reaction is overdone and this whole sell-off is a planned action by shorters imo.

"We believe that the potential one-off payment related to the Serious Fraud Office (SFO) investigation is mitigated by sufficient liquidity headroom and expected disposal proceeds."
https://www.fitchratings.com/research/corporate-finance/petrofac-limited-24-07-2020

legally no big news: regarding the past posts of "rumours" it makes totally sense that
1. management has been confronted by the SFO so they already know the facts
2. PFC management has spent 50 (!) million pounds on legal fees over this since 2017. You bet they are well advised.
3. SFO takes the court appointment as a chance to attack PFC. They are not judges, they can just state sth even if they only have a certain idea about it and no proof.
4. Even if several managers acted with that person, the outcome would be a fine, that can be legally attacked by PFC over the next years and would then be due to be payed only in a few years time and as someone mentioned, could normally also be payed over time. So as Fitch Rating already stated: that should not pose a problem to the company.
5. As for the reputation: the damage in Saudi Arabia has been done with no current new business there. But we see oil rising and oil service companies will get their order books filled now, even those with legal problems. Dont overestimate things: companies like Airbus, Barclays and other big names already had to pay fines or had these problems with no lasting effect on business.
6. I BET in 2 or 3 days we ll see shorters buying in right now

Thanks for your quick response @Modestus - I agree as you know, I already posted my opinion.

yes, I follow these guys for some months already as well. @Modestus whats your personal view on oil and PFC?

Great article on oilprice.com today (I linked it): Quoting the article: "2021 could be a watershed year for oil markets, in which falling investments and bankruptcies will create a supply crunch the likes of which we have never seen before. With an ever-growing list of delayed upstream projects and FIDs, the threat is growing. In a report by the International Energy Forum (IEF) and consultancy BCG in December 2020, warnings were given that lower CAPEX levels and low investment appetite will be a real threat to markets."

https://oilprice.com/Energy/Oil-Prices/The-Oil-Industry-Is-In-Dire-Need-Of-Investment.html

Oilprices rising now and this wont stop until we have such high oil prices that oil producers will be able to finance the necessary capex out of their cash flow as banks are reluctant to finance it.

or in other words, just watch that following video - with egyptian billionaire Naguib Sawiris´ oil price prediction of 100 USD/b oil for November 2021 from May 2020 (when oil was at 28 USD). Remember that same guy also bought most of Endeavour Gold in 2017 before the gold price went up 50%...
https://www.youtube.com/watch?v=yJp9NZ9niTI

What that means: the oil industry is not stupid, they start seeing the shortage at year end coming, so capex will be built up. It ll be difficult for some oil companies that have to get financing for it - but as the market needs the oil, there s no way around the necessary capex investments. For PFC this means that order books will start to grow again by mid year and then get filled up to 100% by year end. In 2022 PFC will re-hire personnel and with the order book growing again plus oil prices up again, there s a good chance of the PFC board paying a (small) dividend again this autumn already. So for oil producers, the worst is over and for the oil service industry the worst will be over by summer.

Short positions go down: AHL sold another 0.2% of shares as reported just today and has now fallen under the limit where they have to report their position. Short sellers buying back is a good sign as these normally are clever investors and typically stocks go up once they bought back. Lets see when the other short sellers follow and take their profits. As I already mentioned, especially Blackrock is sitting on substantial profits from their shorting before the pandemic... and I guess they ll buy back before the shutdowns end.

Short positions will be bought back here without SFO news but just with rising oil prices as most shorters still have substantial profits and wont stand there watching oil and oil stocks go up and their profits falling. I think there will still be some short term "attacks" on the share price to get weak investors selling their shares as shorters are not stupid and realizing you got to get out doesnt mean you abstain finding dumb people selling just because the stock goes down. Nice example was Jan 5th with Blackrock selling just some shares dumping the stock price - but that didnt work. Or just today: Brent at 55 USD - no reason to sell an oil stock - but the stock was down 3% and is coming back now. Pity for shorters their numbers are published with just a short delay - once people will see Blackrock starting to buy back shares - WHO will then still sell shares? 8% of share capital have to be bought back guys... Thats a huge load...

well the 5th seems to be quite "far" away regarding the SP - it was at 1.32 at the opening that day and then started its way up with OPEC+ cutting production only in Saudi Arabia. No one - not even Blackrock - knew that outcome before and its the best scenario that could have happened to PFC. Plus now with Democrats in command of the US Senate (also not foreseeable by Blackrock) theres a high probability US shale production will get more expensive due to environmental restraints which also helps the oil price and is good for PFC as production is hindered/limited only in countries in which PFC doesnt have any business (business in the US is less than 1%). So - of course nobody knows if Blackrock knows something we dont know - but maybe we might see in some days that due to the rising oil price they (and the other shorties) now start reducing their short positions... which would bring the SP to more normal levels compared to other oilfield service companies like SLB, BKR, SBOE or HAL which all have risen more than PFC so far. PFX is up 43% since 1st of November, the 4 others between 58 and 81%. So 50% upside just to catch up with peers.

Guys, I m new in this forum and just wanted to post that link to a Roundtable conference ("EPC leaders discuss the future of the industry") with the new Petrofac COO Elie Lahoud. I ve followed your posts for a while and thought it might be my time to contribute some content). Just for further clarification: I ve invested in PFC in December at an average of around 1.42 pounds.
here s the link: https://www.youtube.com/watch?v=F9pe3T4K348