George Frangeskides, Exec-Chair at Alba Mineral Resources, discusses grades at the Clogau Gold Mine. Watch the full video here.
Jesus 20mins in and cant get a quote or a buy. broker says impossible when i rang
Cant buy at all
The Group has continued to maintain liquidity above its financial covenant. Interesting day ahead
Thank goodness
Strong rns with proper clarity
Let’s just go
Strong hold this one.
Shorters will not touch PFC ever again.
Gone are the days pFc being shorted about 8%
These are not worth it for them
They got guarantees to the biggest contracts and are winning more contracts to 8billion
Just 🤩
Set. Match.
Share price usually follows bond price
They normally trade at same value
Could be similar to them with a US lender.
Fingers crossed. Check out SQZ RNS today.
apologises it has already been discussed here.
I suggest everyone sell up and be done with it
Be mindful that it’s only at 20p
This has been shorted to death since mid October from 80p.
Before the 4th Dec RNS PFC was trading around 15-20p range. So we have gained anything but lost a whole. There is nothing to be happy about.
If we reach 40p or above then we have some momentum.
Before the financial issue came to light which I presume around Oct/nov, it was trading 70p plus with same number of contracts won. So it would be relieve to get to that. Reliefs by adding 2p on a day when the whole market went up by 5-10% is silly
We are still at the bottom
Be realistic
So, if Petrofac generates cash from asset sales, its financial health improves along with its ability to secure these bonds.
Alternatively, suggested one source, clients could make concessions, although this “is not not something they’re talking about today”. A source with direct knowledge of Petrofac lamented its current situation, saying its cash flow issues mean banks will not issue letters of credit, so it cannot pay to subcontractors, contrasting this with the potential of it $5.5 billion backlog won this year. “The company is in good shape with a sound business backlog … the best ever seen in the last four years. However, the capital market is less convinced and has little confidence in the company.”
This lack of confidence is reflected in the stock price, which was languishing at £0.183 ($0.225) at publication time, down from £5.28 in early 2019 and an all-time peak of £16.72 in 2012. In parallel, its market capitalisation plunged to around £100 million this week from about £1.5 billion in 2019 after peaking at £5.6 billion in 2012. In August, Petrofac's future looked rosier when it said free cash flow was set to be “broadly neutral" for 2023 due to cash advances on new EPC contracts and capital being released from legacy contracts. However, this prediction did not materialise, which triggered Petrofac's early December statement on liquidity problems. As one financial source said: “You need liquidity to run your business. You need to pay people and supplies. You have certain obligations to your debt providers. You need to make sure you’re paying coupons on their bonds, paying interest on their debt.”
This huge Aberdeen-based entity employs 3000 people and controls one-third of the market.
A company watcher said that while O&M could be an “obvious business” to sell, “I would consider it to be quite central to the company.” A source close to Petrofac agreed and also downplayed this scenario. Also counting against Petrofac quitting the O&M sector is that a sale could attract the attention of the UK’s Competition & Markets Authority, which a few years ago forced Wood to sell (to Worley) the O&M business that came with its acquisition of Amec Foster Wheeler. “So, if it was for sale, who would buy it?” asked this market observer. When Petrofac revealed the extent of its financial problems to the market early this month, it focused on many issues, leaving perhaps the most important one — performance bonds — to the end.
ources said the key sentence in Petrofac’s 4 December statement was: “Banking and surety market appetite for the provision of these guarantees in support of the contracts won by Petrofac has reduced, resulting in delays”. Jefferies analyst Mark Wilson told Upstream that Petrofac’s disclosure about these guarantees “is a very significant situation” and explained why. “Petrofac’s forward revenues and cashflow come from the execution of new contracts or awards. But without the provision of performance bonds to effectively backstop or rubber stamp a contractor’s performance, that new work may be unable to move forward.” Also significant for the broader EPC market, said Wilson, is that McDermott's recent performance bond problem appears to confirm Petrofac’s overall “reduced market appetite” comment. Nevertheless, he said Jefferies believes “the more important criteria for the banks” is each contractor’s “balance sheet strength, execution track record and type of (performance) guarantee required”.
Upstream was told the contractor may have to raise about $450 million if they are to pay off $250 million of debt due to mature in October 2024 and plug a $200 million hole caused by working capital continuing to be tied up in legacy contracts.
Market sources said two major assets are definitely up for grabs. One is Petrofac’s 35.3% operating stake in a production sharing contract (PM 304) offshore Malaysia that hosts the producing Cendor oilfield, an asset that the company “has been marketing for some time,” one knowledgeable insider said. A contact familiar with Petrofac’s strategy said “it will be obvious to speculate around” PM304 because this is the last upstream asset on the company’s books, having sold everything else in recent years. Another source agreed, saying PM304 is “the key” non-core asset, while stressing the sales price achieved will be influenced by any debt attached to it and the expiry date of the licence.
The other asset to be sold is a 10% stake in the JSD 6000 pipelay vessel, which is due for delivery from a Chinese yard in the second quarter of 2024. In its 2022 annual report, Petrofac valued its JSD 6000 holding at about $56 million, although one veteran marine contracting source said he is “not sure anyone” would pay this amount. Shanghai Zhenhua Heavy Industries is believed to hold a 90% stake in the vessel and has also been marketing it for sale, according to market watchers. Once delivered, Saipem has chartered the vessel for five years, but could retain it for an extra 24 months. One well-informed source with direct knowledge of Petrofac’s options said the company may also consider offloading its O&M business in the North Sea.
Cash-strapped Petrofac aims to sell its upstream and pipelay vessel assets as part of a critical drive to raise some $450 million to shore up its ailing balance sheet, according to multiple market sources. Upstream was also told the company may even consider selling its huge UK North Sea operations and maintenance (O&M) business, although it is still considered a core part of Petrofac’s business. Funds generated from any completed sales would help the financially distressed player secure performance bonds or guarantees that are a fundamental, but little known, requirement for any contractor involved in the engineering, procurement and construction game.
One of the biggest issues they’ve got is getting guarantees in place,” said one source close to the London-listed company.
After a company like Petrofac wins an EPC order, it must always secure a bond or guarantee from a financial provider, otherwise it cannot start the contract and receive milestone payments from the client as work progresses. However, if the contractor fails to meet its contractual commitments, its client can then place a call on the bond. Market sources said these financial instruments were not an issue until this year, when Saudi Aramco pulled contracts placed with McDermott International because the US company — with its own financial problems — could not secure performance bonds. “It’s extremely rare these [bonds] ever get called in, but clients still want them,” said a financial source, adding that perhaps they are in the spotlight now because of high interest rates.“The cost of money has gone up and any bank with a few billion dollars of exposure to any sector always looks at that exposure and decides whether they’re happy with it.” Petrofac’s problem is acute because, despite securing billions of dollars of backlog recently, these contracts will be worthless if it cannot secure performance bonds. It was on 4 December that Petrofac reported its cashflow crunch, highlighting that selling non-core assets would boost liquidity.
Yes read it but lot of he said she said unverified sources quotes.
Do I believe in it? Not really.
450mil raise is lot of money in todays world. There is no mention of how pfc is owed money fro contracts which they were meant to receive in H2 nor any mention of upfront payments to be made for the contracts won.
Trawl*
I know for a fact that hedge funds don’t have that much a privy information for what is already in public else it will be illegal. Now there is certain news which might be of use to them but these guys have dedicated analysts who trol through information that norm PI fathom understands.
Now, I also know these website which shows 9% or 20% open shorts etc on tracker websites are not the full truth. Don’t think any website it truthful and even if they are it is not live or uploaded up to date. Only Bloomberg provides that information and you have to be a member or something that allows you to see that info.
There is much more going than people hooting it’s shorters, long termers or squeeze etc.
You’ve got to look at the company from business and forward prospects. Does it make sense. Any company can have bad year but will they follow up with good years or are they still in demand etc are things to focus on.
Like many don’t sell, not worth it as it’s worth multiple from where it currently sits. If you thought Rolls-Royce and M&S were going under couple of years back, you were an idiot
Lol no its not, market was expecting board to intervene during short attack, they didnt. they released news because of shareholders pestering and release of media reports before 4th Dec.
Who am i?
I'm GOD!
Does it look like price action going to hit 25p, no volume.
Scmdyc pls stfu it is not going to 25p
Where is the naysayers