Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
I've only done fag packet maths but cant see how they are going to get above 0.2p annual on 5000 pbd
My numbers (($42*3500 bpd) +($30*1500)) *(0.9 *for 10% downtime) *365 = 63m inflow assume they manage to keep half of that the FCF is 32m
Divide the above by the number of shares 701,34673,160 and multiply by 100 = $0.45 so about 11.24% yield which is good enough value for me and lends me to my expectation of 0.1 a quarter which seems sensible and achievable based on 5000 bpd . Capex would have to be limited and zero down time - upside in better prices and excess production - but then we'd lose cash in capex
10% a year though on stable field i'd take it and the share price would double if people knew it was a stable dividend
well they approved a resolution to issue more shares - which means at some point they WILL ISSUE new shares. if i was them I'd do 2 quarters of divis and then place to buy something. Only plan was to buy an asset no need for Opex - might do debt if they can
I guess if you are running what you would consider a private company I wouldn't= show up as it would be a pain in the arse and a waste of time . Still I think I'll probably be able to hitch my tiny paws to his coat tails and with a bit of luck I might be able to get a few drops of his slop as it falls out the corner of his mouth - at current prices pretty comfortable these will bag from here now so will hold and add if they get that Divi announced - re shallow wells 2 this year not currently drilled in a couple of months I think - drifted off for a fair amount of it as I didnt get a coffee till half way though
OverviewBrief note of AGM – pretty well attended – although most of the shareholders are ancient I imagined they bought in when people where using whale oil. JOKINGResolutions All resolutions were passed including new share issue to 15% of market cap (more on that later)Dividend Divi is going to be declared and paid in the very near future (within months, I expect announced in July) with a view to making regular payments and a dividend policy. Extremely strong messaging on this from management. I expect the value will be 0.1 a share with a view to 0.4 annually. While the values are mine Clive stated “we have the cash now working its way through the companies” and any dividend “would make us extremely cheap” – this would give the co a ~10% yield they would have the cash for this too. Clear view to making this a regular payment as a way of driving the share priceHoping to use the dividend to bring on some institutionsShallows Targeting 5000 bpd for year end – I think they will do 90/110+ million revenue this year. Under 2mill each to drillDeeps : Some noise on this that this one will eb the big one – no idea really I’m here for the cashflow from the shallows3A : is junk has been written down to zero now looking to sell – wont get what they paid for itExplorer : Got the impression that this a contract is imminent and in the region of 20 -25 m for activity next year– cashflow on this is extremely positive costs about 12K a month to maintain. Mgmt think its work at least $50m as an asset – if it gets a contract then clearly much more valuableWind said some junk on wind – no large expense comping up just some surveying – sounds like a terrible idea to me but whatever.....Funding All activities to be funded out of cashflow – any large projects e.g production outside of Khaz to be done via placingManagement Khaza management look terrible – CEO didn’t show up – didn’t say a thing noises on the Teams call. Clive on the ball was actually surprised by level of detail. High risk low reward exactly the sort of stuff im addicted too Valuation 10% yield and a bit of positive noise on this boat I’d say a bag in there for me from herePR Going to do more of this – especially off the back of the Divi newHappy to respond to any questions but probably easier over twatter
Your query though i think does raise a point - that this group's structure is a mess with loads of intercompany debt to subsidiary parties and shareholders who are in turn debtors and creditors back to the group - the share price will be discounted due to this mess. It also raises the point that you want to be careful shuffling these debts around and writing them off ect so you dont create a dividend trap somewhere
No i think they should be ok - the cancellation of the share premium basically brings them back to Zero. Dividends from Eragon UK were $49.3m in the year. I assume they would just divi up the income from Eragon UK and then back to back it with the parent issuing a divi . You dont need to wait to year end to declare a divi you just need to make sure you have the profits
Great - Im on twitter under @ds_lyons so if you use it message me on there if you have it and Ilkl share my contact details. There is a pret opposite Ill aim to be there from 10.45 more interested in comparing notes after so can always do that over email or here. Really frustrating set of results and I'm actually pretty irritated with lack of clarity
Related party transactions are a incoherent mess - as far as I can work out the Ozimans lent a further $867K of new loans to the group - The company effectively borrowed a further 908K in "cash advances" for repair services from EPC Munai LLP a vehicle owed by the Ozimans - anyone able to provide any clarity on this at all?
The final deep well required under the BNG Work Programme commitment is Deep Well 802, which spudded in
June 2022, with a Total Depth of 5,300 meters and will target oil in the Carboniferous and the Devonian and an initial
target at a depth of 4,300 meters. At the date of this report drilling had reached 650 meters without incident - doubt it will flow given the previous results in the Deeps
Is anyone going to the AGM on Thursday - I am planning on going and would be good to meet up. I only have a pilot position in CASP and currently not entirely sure what I think - actually I do - this would not be at all interesting if it wasn't for the high oil price and the noise around divis (miles away though)
Re the renewable nonsense I note Oziman had a dissolved KAZAKHSTAN WIND FARMS company registered in Colchester - what I would be concerned about is another acquisition of a non performing asset from a related party . Caspian Explorer seems like an expensive floating hunk of metal - with no real revenue to come
Final think is the COO is $45K no shares this clearly isnt credible I expect he's just an empty hat
Anyway if anyone is going I'd like to meet and share notes - also cant find the resolutions to vote on has anyone?
dividend investor return policy is 20-30% of the FCF? i.e @20% = 6.4b +7bn permian sale =13.4b/174 =7.47%?
Just want to double check . Shells Mkt cap 174 USD. 7bn returned from Permian sale. so 4% of mkt cap returned in one go?
And then FCF of Q1 4.4+ q2 8.3 +11.38+ (assume 8) = 32.4 FCF shell trading at 5.37 its FCF??
There is no way you would list if you could do it by debt. The listing of LCCM on ASX was only suggested by the advisors. I don't know why anyone would do anything by equity if they could do it by debt as its much cheaper . If you put a £7.3 loan into this co and a global bank has done the DD on the cashflows to support the loan then you have to assume this is extremely cheap as the current market cap doesnt apply any value to the cashflow. If they get the loan its a huge green light. I also don't think anyone would be mad enough to put out an RNS like this if they didn't think they were going to get the loan. Agree with southwester comments on margin but I've refinanced a number of times and really from my experience its been (1) what's your model (2) stress test the model with bank (3) bank sets covenants then (4) wait half a year and immediately look to refinance on what's actually happening be if better or worse performance then model . Bank pretends to mind but doesnt really as they get loads of fees. I think they were planning on doing this with a bullet anyway
10ml aud loan facility is about to go into a company with a market cap of 10m gbp
The project has an npv of about 100m with payback in about 3-4 years. On a fundamental basis this is incredibly cheap and its all done with debt. Excellent update and should retate