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No I'm not. The time to complain about the LTIP was in 2014. Shareholders of record back then approved it (not me). Now one needs to take it on the chin. Good luck b*tching about nail cost option awards at the AGM...
Does anyone know when the current plan expires? That's the next opportunity to voice concerns about a plan proposal.
If I'm not mistaken this is the grant that is now up for vesting:
https://polaris.brighterir.com/public/gulf_keystone_petroleum/news/rns/story/xlqod3w
2,751,974 share options were awarded under the LTIP in April 2021. Unfortunately, we are left to guess the number that have lapsed, versus those that have vested but aren't expected to be exercised immediately, versus those that will be (with the share delivery met from the EBT and this issuance of stock).
I wonder how many more nil cost options will be awarded in the next couple of weeks with the 2024 grant...
You should be far more concerned with how many, if any at all, of the 8.224 million o/s as of Dec 31 - from that portion that were granted circa 3 years ago - won't vest due to performance targets not being met and hence will vanish (allowing the FD shares o/s figure to fall).
"Still an unnecessary dilution though. "
What is? As of Dec 31 there were 8.224 million options o/s. That's the dilution. It was created quite some time ago. (And expect more LTIP/DBP issuance in the next few weeks.) Since they only have 200k in the EBT they need more shares and can either issue more shares (for no consideration) or use excess cash to buy those shares in the market (and not cancel them). Yes, I'd prefer the latter - and a buyback of a whole lot more than 255k shares. That excess cash isn't earning anywhere near close to its cost of capital...
PS: Deferment isn't a cut.
Once again, the dilution occurs from the option grants and not this issuance. Only an idiot uses 222,698,655 as the denominator rather than the FD number of circa 230 million which hasn't changed as a result of today's announcement.
As I said two days ago (before the latest, short-lived giddiness):
" they received $25 in February when Brent averaged $83.5 a barrel. Clearly the company had to accept a lower price to move greater volume (a strategy which I think is smart as keeping the field ticking over is good). Brent averaged $85.4 in March, up 2.3% on February. We await to see how the company did in March... $35 would be great, but I wouldn't count those chickens yet."
The current share price expects a lot more than local sales
"Their subsequent announcement that they were only being paid 25, albeit for larger amounts, disappointed the market. "
Yes, they received $25 in February when Brent averaged $83.5 a barrel. Clearly the company had to accept a lower price to move greater volume (a strategy which I think is smart as keeping the field ticking over is good). Brent averaged $85.4 in March, up 2.3% on February. We await to see how the company did in March... $35 would be great, but I wouldn't count those chickens yet.
Ugh, I've no idea what you just said but I think you forget that there are two sides to the ledger. One side is the making of value (+ to equity value) and the other is paying it out (- to equity value). If, and only if, the first is higher than the second does equity value grow. Note, you can always 'get value out' of a publicly traded shareholding by selling some. There's no need to wait for the company to distribute value to you.
And where did the ability to make 'massive' (yes, supernormal) dividends come from? Over the last three or four years GKP recovered the bulk of the CRP (creating value for current holders by recovering the expenditure of previously wiped out capital contributors). They could then pay it out to current shareholders. Very little came from true, lifetime, project profit generation.
Investors 'might' lower the discount rate but that doesn't change the fact that money went out the door. "All else being equal" means just that. Personally, I don't 'value' dividends at all (and would not alter my discount rate as a result of them). To me, the value the company can actually generate is the only thing of worth (and builds share price) and not that it decides to pay some of that out. You might feel otherwise and if our difference of view is great enough then perhaps at one point I will sell to you.
And, yes, the best possible source of capital returns is recovery of the CRP much of which is in the invoices that are now long overdue. But, as I said, $25 per barrel or even $35 doesn't allow a lot of gross field sales headroom for those to be paid. For that, as mentioned, we need a return for exports. The next best place is a combination of both the excessive cash sitting on the balance sheet and the little biddy bits of CRP that are being recovered each month via local sales - there's still $50-55 million slowly being recovered. (Remember that current revenues are still flattered by excess cost recovery - that little bit of the CRP that has not yet been invoiced.)
"The share price is low enough to offer the prospect of value accretion through capital expenditure in that direction (unlike previous occasions)."
A buyback isn't "capital expenditure". Money leaves for nothing in return. It's distribution. But you, as would I, might feel that increasing your relative ownership at these levels (by not selling into the buyback) is a decent trade. The success of that too, however, depends on a return to exports via the pipeline.
"No problem if I’m wrong because @ 35 dollars a barrel 108 p and a reasonable profit margin"
I love it how people expect $35 when the company was last paid $25... a 29% lower figure.
Just for kicks I plugged $25 per barrel FOREVER into my model. Without arrears recovery (there isn't room for it at those prices) it suggests a fair value for GKP (50k production in perp sold at $25 and assuming the current contract remains intact) of 83p per share. (£1 year end discounted at 20% to end April.) The current share price assumes a LOT better scenario than limping along forever with domestic sales at $25 a barrel. The equivalent but assuming $35 a barrel sale price is 114p. So you could say the (bullish?) $35 per barrel scenario is pretty much fully baked into the current price already. We need a return to exports and recovery of arrears to make appreciable gains.
As for dividends (or buybacks), yes maybe they pay out a little of their excess capital. But the hint is in the words "pay out" - the value of the company decreases when funds are paid out and all else being equal the market cap reduces accordingly.
Always better to get the currency right... (I had used 1.2639 for Cable. FD shares o/s 230.868 million.)
Cheap for good reason.
All of this is about screwing the Kurds. Don't think Iraq/Turkey are quite done with that yet.