Member Info for Soder

I have been handed my arse on this stock from higher levels. Someone mentioned the bond in an earlier post. The guys buying that will have the keys to all the value if this ever has to restructure. The board are going to kitchen sink the numbers to get all the bad news out at next earnings. Buckle up. It’s rome or bust.

This stock is a mkt makers dream. A penny stock, with a huge daily seller, an M&A carrot that (potentially) gets you 2-3x, a load of pantwetting casino type small investors all worried about and trying time every 1p move and who could not analyse a balance sheet if their lives depended on it. Like lambs to the slaughter.

Mr Amir...He did not predict it but in illiquid penny stocks you get a lot of sheep. And you know what happens to sheep? They get slaughtered.

You can’t compare investment grade companies (BP) with junk/high yield. Enquest is single B and levered hence its high correlation to the oil price. The documentation for an investment grade bond versus a high yield bond are vastly different. High yield bond documentation will prevent cash leakage to shareholders u less specific criteria is met. Unless enquest gets down to 1-1.5x leverage it is highly unlikely they will be able to pay dividends post a refinancing. If they were to refi at the moment the cash cost of their debt would be north of 10 per cent Nd that would also east into cash flow and limit ability to pay dividends.

Ithaca just had to issue bonds at 9.375 per cent. The credit is meaningfully lower leverage that enquest. Enquest is approaching a maturity wall and will have to address this over next 2 years. There is no, and I mean NO, ZERO, NULL, Never gonna happen, no change of a dividend from enquest before they refi. That is a fact. And even then, the docs for any bond will prevent or limit the companies ability to pay out dividends - just like with Ithaca. Bond holders do not like funding distributions to shareholders.

The biggest dividend this company can and should give to shareholders will be a refi of the bonds which will not be a slam dunk. That is unlikely to happen for a couple of years and nor should it as if they had to access mkts at the moment the cost of debt would be meaningfully higher than a 7 per cent cash toggle. In short, all this chat about dividends is complete fantasy. Either way, if you want dividend from an oil investment go buy shell or bp. Enquest is a growth story and will need to constantly invest in replacing reserves not paying out to shareholders.

With these 7% bonds trading low 80s and yielding north of 15 % the mkt is telling you your opinion is wrong. To refi inside 7 (in the bond mkt) enquest would need to be BB and sub 1x leverage with much more diversification. That’s a looooong way off.

No it hasn’t. It’s been above 65 which is the toggle price.

Pelle - no change to production. Even Cairn said 30-35 for 2019. So what exactly changed.

Banning petrol and diesel cars? You need to lay off the drugs mate!!! You know when you watch Corrie and your lights flicker during the interval cos everyone turning on their kettle.... imagine everyone plugging in their cars between 5.30pm and 6.30pm. THE GRID CANT TAKE IT. Unless every country in the world rebuilds their entire grid it ain’t gonna happen. Fact.

Squiff- having to reading your constant panic is very tiring. Let me help you out mate... oil investing is volatile and even more so in non majors. I would suggest you do everyone a huge favour and sell up to buy BP. If that’s still to racy...National Grid offers a decent dividend.

Equity valuation needs to be forward looking. So you need to take a view on production and oil price over a few years. A static ebitda and ev multiple won’t be sufficient as enquest will need to invest just to keep production stable... if not it will decline. Pre kraken enquest bread and butter is Magnus type deals and extending reserve life of unloved assets. We should assume that there will be more Magnus transactions going forward as if not where is your equity story. AB is a smart guy. He can’t vintrol oil price but he is slowly digging enquest out the hole.

Read bond doc. The interest period end March and the calculation date before that. It’s just paid in April. Calculate average Brent price thus far for period and you would have to have big immediate sell off in Brent for it not to average 65 for the calculation period.

Not really a dividend... it’s the coupon. You can work it out from average Brent price between interest payment dates. Answer is yes. Will be cash pay.

So in that case if it’s not oil beta it’s that you think AB (a company insider) is a idiot? if you were CEO of enquest and there was something wrong then you would not be buying stock, right?! Only an idiot would. But AB did. Very recently. Who you think know more....mr market or mr bseisu?

So if oil moves down 20 per cent to 50 then enquest will move down 21 percent to 15p....So oil company share price moves down (and up) with oil price. You must be the brains of the operation....

My friend, contrarain views are what makes a market. Without them there is no buy, no sell, no buy, no sell. I am all for opinion and view but you sound like you are just here to score points for your ego. On this name I could crush you. I won’t. But I could. Just remember, it’s nice to be a important, but it’s more important to be nice. adjö

Squiff, don’t worry. There is zero appetite from any credit provider (banks, hedgies etc) to lever up oil companies. Unless AB can pay off over 1.8 billion of debt on his own he has no ability to action a buyout. Literally zero.

I know it well. I live near medborarplatsen so a bit further north. It’s dark and cold. Very dark and very cold at this time of year. Roll on summer please :) Re oil pelle I am pretty relaxed. A large part of the December sell off was negative gama as trading desks hit put strikes so were forced to sell spot to hedge and this driving prices down. At 60 we are ok and so is the industry. Listen to Halliburton and Schlumberger reports this week....shale has the brakes on and canibalisation in the Permian is becoming a big issue. Add on to that potential Venezuela sanctions from Donald (maybe this week) and supportive opec+ actions and I think we have a floor. Oil will do what oil does. But the elephant in te room is a ceo that can make deals on the cheap. Most of the north see is on the black and I fancy AB as a Del Boy trotter on the deal side. This time next year we’ll be millionaires, rodders :)

Born here. Live Stockholm. With terrible English. Worse Swedish :0