Member Info for sasa43

And the banks, too, come to that, NewK - they've been 'making hay' from the sharp rise in interest rates of late and are flush with cash right now...

I always felt that Rishi's imposition of the WPT at the time was more of an expedient political sop than anything else and I hope he remembers that the O&G producers are now paying 65% tax on their profits - already way higher than any other corporate entity and gas prices have fallen significantly of late, too - sasa.

Agreed, upomega and also with DTP's later post - sasa.

upomega, the sp is still up 25%, although well off its 'high' subsequently, over the past 5 months - not many shs can sport that sort of showing in these mkts.

I don't favour 'buybacks' in utilising some of the excessive cash build, myself, given their eps are growing dramatically anyway in these conditions.

If they can't find an attractive target or deal, even now, then better to pass some of the surplus onto the shareholders who own the business after all and let them decide what to do with it via a capital distribution or a one off 'special' divd...

Just my take on the alternative usage - sasa.

Agreed, Mr Flibbles - in a bear mkt, peeps take profits to offset losses elsewhere and Serica has been very profitable over the past year or two.

Yes, one can argue that ACW / MF have been too cautious with their burgeoning cash pile over the past year or so ('not overpaying', etc.,) but things are now moving in their favour as gas prices ease, pre Winter and with borrowing costs escalating, any outfit without that burden / actually benefitting from the cash squeeze, is in prime position now...

With their cash earning more on deposit / their previously expensive hedging contracts steadily running off, any acquisition plans should be receiving close attention in these conditions, regardless of the Nth Eigg outcome before Christmas and in the meantime, a 'bomb proof' yield of 5.5% (possibly much higher after the Y/E) and a prospective earnings multiple of 3 x or so right now, illustrates how cheap this share is in today's conditions.

If you know of better value elsewhere, then switch into it, if not, stop moaning about the sp weakness recently; that's driven by 'bear mkt' sentiment currently and nothing more, imv - sasa.

Hi NewK - I thought that a possibility, too, fwiw, re: Ithaca, once listed, they might well consider having a go at the likes of us, given their avowed acquisition plans; we're a digestible size for them with their new quote / all their cash / our location and vulnerability, etc.,

Provided, of course, Jeremy Hunt doesn't look to increase the WPT again in the meantime! - sasa.

In the O&G sector, not least this one, at the risk of stating the obvious!

When Winter sets in, peeps will surely look back at this sp level and rue not taking advantage, when the opportunity presented itself. - sasa.

Hi NewK - With hindsight, I think it all started to simmer beforehand when both the Fed and the BoE dismissed the inflationary upturn as being merely 'transitory' - no concern back then to counter the threat just in case they were wrong. Subsequently, both have been raising rates, especially Powell of the Fed, to catch up with it all, with Putin's war having so exacerbated matters which, admittedly, couldn't have been foreseen.

As for Andrew Bailey of the BoE, he was useless when head of the FCA and has maintained that ineptitude ever since ( i.e, now telling the mkts when he'll end the support program just invites sterling holders' nervousness afterwards) so another 'U' turn seems almost inevitable shortly.

Meanwhile, Serica's offering a solid 5% yield currently and that's a helluva sight more appealing than gilts right now and most other investment alternatives, too, given the prospective total return potential from here, imv - sasa.

That was a duster / price declined for a few days and then steadily recovered.

Yes, it'll be a meaningful boost to our reserves in a few years time if it comes in; if not, then the 'write off' costs will be 90% offset by the latest allowances, so no material disadvantage, other than the initial disappointment, sp - wise.

Meanwhile, the cash mountain just get bigger and bigger... sasa.

Both Serica and HBR have about 6 years reserves as far as I can make out, Infor; the advantage HBR has, amongst other things, is useful exposure outside the NS which Serica is aiming for, too, seemingly.

Ostensibly, a good fit for HBR but if Nth Eigg comes in for SQZ to effectively double their potential P2s, that would radically enhance Serica's appeal as a more meaningful target and with their even higher cash pile by the time they announce the drilling result in December, if successful, then all the more so, of course.

That cash accrual could well equate to near SQZ's mkt cap by then; ergo, an EV of virtually 0 around todays sp level!

On that optimistic outlook, any approach would require a £6 + offer price for starters, I'd say, so Serica remains as 'cheap as chips' here as I keep sayin'...

However, if ACW / MF do announce their own opportunistic M/A deal at long last, a decent re-rate should also rapidly ensue - either way, in these mkts currently, Serica's a better share than most to hang on to, imv...

Just my take on things, fwiw - sasa.

Now couldn't be a better time to step up their searches without 'overpaying', given the latest credit crunch merely puts cash rich companies in pole position, especially those with no debts to worry about, like Serica.

Quite a few gas asset owners, especially where heavily borrowed or attractive 'farm in' vendors seeking urgent funding are concerned, must surely be more susceptible now to doing deals at lower prices in these increasingly difficult conditions as they're likely to intensify from here.

They urgently need cash and Serica has it, loads of it and rising...

They'll probably wait to see how Nth Eigg turns out before closing on any deal but in the meantime, they're beginning to earn some decent interest on their huge cash pile, too - talk about being in the 'sweet spot' through pure luck!

While we wait, such benign circumstances can only be of major comfort to those holders of unencumbered gas producers like SQZ... sasa.

Yep, that's how I see it on the likely eps outcome at the Y/E NQM - a p/e of 4 or so...

As for the H1 figs out today, everything's largely as expected, imv, with the 8p inaugural interim divd v the 6p targeted, being a vote of confidence in the full year outcome. If there's no M&A announcement by then, that'll be the time when a 'special divd' would likely be announced.

Even without a prior Nth Eigg success, the shs remain 'as cheap as chips' with Winter coming up and who knows where the gas price will be when energy demand is at its peak? - sasa.

As the mkts retreat on growing anxieties, especially where stocks are susceptible to curbs on discretionary spending activities whereas energy producers are not, of course. Peeps sell anything when they 'rush for the hills', even the most resilient situations, like Serica and Harbour, to offset losses elsewhere - that's just human nature...

What's FOBI? A new acronym I've coined; 'Fear of being in', fwiw - seems apt in today's circumstances but the likes of SQZ and HBR will be amongst the first to rebound when things calm down, given their exceptional value currently, so best to ignore the collective mayhem right now, imv - sasa.

Good / sensible post, there, Professional - sasa.

Hi Lucky - whatever the BoD have in mind, we'll find out next Tuesday...

The H1 results should be quite something, given the 100% revenues from BKR / Rhum3 / Columbus contributions / startling increase in the gas price, etc., and, hopefully, acute awareness to deploy their 'embarrassing' cash hoard rather than just sitting on it - the sharp rise in inflation should be an added spur in this regard, if nothing else!

With MF already stating that they're stepping up their search for investments outside the NS (WFT impetus), I'd hope that there's something already in hand in this regard. If not, a share BB would be a limp alternative approach to excessive cash utilisation (they only have approval for a 10% cancellation of the float, anyway, as things stand) and so it wouldn't dent the cash pile very much.

A 'special divd' is very feasible at this juncture, as it's only a 'one off' distribution, whereas a decent hike in the normal divd has to be maintained to avoid subsequent disappointment if things deteriorate - that could be anything up to, say, a manageable £1 ps - agreed...

If the Nth Eigg outcome is successful, that could well prompt a move onto the main mkt soon (potentially doubling our P2 reserves) so, hopefully, next Tuesday should give the sp a well overdue lift out of the doldrums from here - sasa.

Agreed, whimax - the RNS which will move this is the obvious one - a 'farm in' to get the monetisation underway or a T/O; the former being the more likely at this stage, I guess.

Given the size of what's already confirmed and the potential of a lot more going forward in an energy hungry world now, it's just a matter of time - can't be much longer, surely? - sasa.

Yep, that's about the size of it, Vestry - the investment arm is in the price for nothing, reflecting the conservative (some might say 'sleepy') management approach here but the port ops. are doing reasonably well in difficult circumstances right now.

This share is hardly followed at all with no selling to speak of - so 'cheap as chips'. I like the potential here, though, which might be realised at some point, so content to hold such an undervalued asset in todays expensive mkts, fwiw, if that helps but DYOR, as always - sasa.

Like it, Maverick (made me chuckle, that) - 'the biter, bit', you might say... sasa.

Re: the Nth Eigg delay, disappointing, of course but it's only a delay of a couple of months - much more important will be the H1 results out on the 27th, along with their forecast for the full year. These should be very impressive, coupled with some additional 'goodies' one hopes - sasa.

Yep, in a fortnight's time the interims will be released, as you say, Roth...

So far in 2022, everything's moved in their favour which all the regular holders on here are very aware of, with rising revenues / profits being substantially boosted by the unexpected ballooning of the gas price, too...

The inaugural interim divd could very easily exceed the 6p ps target mentioned previously, along with other possible developments being announced at the half way stage this year.

Top of the list must surely be how best to utilise Serica's huge cash surplus which is growing apace, bearing in mind their recent escape from the clutches of Kistos - a lesson learnt there, hopefully... sasa.

Quite so, Soder - that applies to Serica, too, of course - sasa.

Nice one, Mommur - sasa.