Member Info for surprised

Various scenarios with epl, however, broker view remains at 290p target and ironically 400p with lower oil/gas prices (the folly of epl)

https://x.com/surprised_trade/status/1825802105791078704

Takeover talks underway and an initial derisory offer of 13.9p (mix of shares and cash) is opening position. All brokers have stated much higher valuations 20p -30p+

https://x.com/surprised_trade/status/1825781835185471992

13.9p in total and a mix of cash/shares is far far too cheap, the potential they are buting is worth a great deal more as all brokers have stated in recent outlook reports....a much hugher bid required, I can wait

SP Angel Broker note out - Blue sky upside comes from improving price differentials and an active M&A market i3 offers investors an attractively priced opportunity to gain direct exposure to structural changes in the Canadian energy landscape. AECO natural gas prices in particular are expected to more than double over the next 12M with the start-up of LNG Canada next year

We maintain our Buy rating given the considerable discount on EV/flowing barrel, PDP value and 2P reserves metrics that the Company trades at compared to its peers. We set a 30p target.

Essentially i3e debt free and created significant liquidity to finance our development program.

Production assets continue to perform robustly, and we are pleased to reconfirm existing production and EBITDA guidance for the year, which is a result of the Company's stable, low-decline, production profile and a rigorously enforced hedging programme.

Look forward to our H2 focussed development and drilling programme which has already commenced with the successful drilling of our first operated well in Central Alberta. Our team will be busy during the second half of the year with back-to-back drilling across our portfolio, which will set the Company up for the commencement of our Montney development drilling in Q1 2025 for which we now are evaluating asset backed debt financing solutions to accelerate development.

Better than expected figures for the period and all set for increases in production, growth, profits and Free Cash Flow going forward, a lot to like .

Zeus broker report 10.06.24 -

Straightforward growth and income, underpinned by strategic flexibility. I3E offers investors a straightforward strategy of generating production and cash flow growth via investment in new drilling, alongside using some of its cash flows to pay out a healthy (10%) dividend. This is based on several factors: existing production, material reserves, ongoing cash flows, and flexibility achieved via the existing portfolio and the option of M&A

I3E’s production drives significant operating cash flows for the company. These then provide funding for both growth CAPEX (via further drilling) and dividend payments, allowing the company to deliver both elements of its strategy.  Potential for significantly higher dividends on higher oil and gas prices. As a producing company, I3E’s cash flows are unsurprisingly sensitive to commodity prices. Our numbers show that higher oil and gas prices than we have assumed could lead to significant additional cash flows, giving the opportunity for more new drilling, and higher dividends.

I3E has material funding beyond its operating cash flows. Earlier this year the company agreed a new C$75m debt facility to refinance its existing debt, and a subsequent sale of the majority of its Canadian royalty interests for US$24.8m meant net debt then moved to zero. As such, I3E has significant funding flexibility for 2024 and beyond.

Potential for gas price upside from North America LNG ramp up. Canadian gas prices have been under pressure in recent years, alongside North American gas prices more widely. This could begin to reverse going forward as more LNG export projects come onstream, in both Canada and the USA. Higher gas prices would drive substantial upside for I3E.

Valuation and outlook.- Our total risked NAV for I3E is 33.6p, we consider the stock very attractive at current levels. Going forward we look for ongoing updates as the company begins to execute its 2024 drilling programme, which we expect to drive increases in production particularly towards the end of the year.

Https://x.com/surprised_trade/status/1822911332162703493

😳

Added at 181p...

https://x.com/surprised_trade/status/1820369074691391705

Added at 16.8p and 17p...

debt reduced, costs reduced, dividends & buybacks upcoming- '' #GMS has also approved a dividend policy dedicating 20%-30% of annual adjusted net profit towards distributions to shareholders in the forms of dividends and potentially share buyback

https://x.com/surprised_trade/status/1818898795725250829

Added at 38p

PTAL Unrestricted cash position increased by over 30% in last quater ...

https://x.com/surprised_trade/status/1820376044873945581

Added again 9.43p...

https://x.com/surprised_trade/status/1819000229368094975

Broker reports out

''...the new facilities provide GMS with greater cash flow flexibility. While there is an element of saving on the interest rate compared with current debt facilities (which are at SOFR +300bps), the new repayment profile is significantly lower. Whereas currently GMS currently has a quarterly sweep which sees the majority of its free cash going to repay debt, the new profile gives the company much greater flexibility. The company intends to use this specifically for establishing shareholder returns, with the option to also deploy its cash into growth initiatives, including potentially leasing or acquiring new vessels if attractive opportunities emerge. In our view, the new facilities also reflect the significant improvement in GMS’s balance sheet since the last refinancing in 2021.  Dividend policy now established. GMS also announces a new dividend policy, where GMS now aims to return 20-30% of adjusted net profit to shareholders via dividends and/or buybacks. In our view, this demonstrates both the flexibility offered by the new debt facilities, but also management’s confidence in the ongoing future cash generation capabilities of the business. There’s no specific guidance on when shareholder returns could start, and we would expect this would not be before H2 2025 (with perhaps an interim 2025 dividend payment), allowing for further de-leveraging. Nevertheless, this defines a helpful direction of travel and gives investors an idea of what the business might be capable of.  Overall, this is a positive update for GMS. It further confirms expectations of another strong year in 2024, while also demonstrating future benefits from the significant cash flows that the business is generating, including further de-leveraging, shareholder returns, and new growth initiatives. This highlights how the company and its balance sheet have evolved in recent years, and the benefits to be had for shareholders from this going forward.'

''GMS has announced revised US$300m banking arrangements with three banks resulting in reduced interest rates of 250bp +EIBOR, (down from 300bp +SOFR) which will fall to 225bp +EIBOR when the net leverage falls to 2x. The facility also removes ‘most’ restrictions on dividends and share buybacks with GMS confirming it will pay 20%-30% of annual Adj. net profit to shareholders. We have assumed it will pay a dividend on the full year results of 2025 of 0.9p, implying a dividend yield of over 5%. We re-iterate our BUY recommendation and target price of 28p as the favourable macro-outlook and improved visibility sees GMS heading into 2H 2024 and beyond in its strongest position for years''

Debt reduced, costs reduced, dividends & buybacks upcoming- '' #GMS has also approved a dividend policy dedicating 20%-30% of annual adjusted net profit towards distributions to shareholders in the forms of dividends and potentially share buyback'

https://x.com/surprised_trade/status/1818895346283565542

Wild fire map...so far so good...

https://www.arcgis.com/apps/dashboards/3ffcc2d0ef3e4e0999b0cf8b636defa3

As expected, the rate of the Energy Profits Levy (EPL) will increase from 35% to 38% and the 29% investment allowance introduced with the EPL will be removed. The changes will be effective from 01 November 2024 and run until 31 March 2030. • The government has also signalled that capital allowances (including first year allowances) in relation to the EPL will be reduced, but has said that the extent of this will be established after consultation with stakeholders and published in the 30 October fiscal event. • While the continued uncertainty is unhelpful for new investment decisions, the government did confirm that the permanent regime (CT of 40% plus SCT of 10%) would remain unchanged. This is a positive surprise as this implies that the 62.5% uplift on capex for SCT purposes will also be retained. This means that for each £1 of capex, £1.625 is deducted from taxable profits for SCT purposes. We had anticipated that this uplift would be removed. This feature together with statements that they would consult on a long-term replacement for EPL could be read as an intention to provide some stability to the industry. • Assuming that the new oil & gas UK fiscal regime will be in line with Norway’s (which was the Labour party’s indication before the election) where 100% of capex is deductible against taxable profits, then the reduction in capital allowances for EPL purposes might only be changed so that it offsets the retained uplift on SCT. Our model and valuations are based on these assumptions. • The Energy Security Investment Mechanism will remain and the decarbonation allowance is unchanged. Pending further details expected in the 30 October fiscal event, we have not changed our forecasts re-iterate our target price of £2.90

Implications for Serica worst case ifcapex not deductable) •

Notwithstanding the proposed fiscal regime changes, the fact that the 62.5% capex uplift for SCT purposes remains in place means that our valuation for Serica on a worst case scenario (of capex not being deductible for EPL purposes and no sunset date for the EPL) has increased to ~£1.90/sh from ~£1.80/sh. Under this scenario Buchan would however not be developed. This valuation still represents >50% upside to the current share price

. • Assuming a sunset date of 2030 for the EPL (in line with the government’s announcement) sees our valuation increase to ~£2.30 per share (=90% upside). This assumes that Buchan is not developed.

• Under a low commodity price scenario (GBp57/th for NBP UK gas prices and US$74.21/bbl for Brent, the level below which the EPL would fall away), Buchan is sanctioned and our valuation for Serica would be~£4.00.

Solid half, better to come

Start-up of the ANOH project and continuation of the underlying performance in the rest of the portfolio should see a stronger operational performance in the second half while completion of the MPNU transaction looks more certain than ever. The share price has been strong in anticipation but we anticipate that completion of the MPNU acquisition could drive further upside

The 2024 programme of 13 wells is on track for completion by YE24 including key start-ups at Sibiri, which came onstream late in 1Q24 and is producing ahead of expectations, and in Abiala together with the progressive return of pipeline capacity on Zone 6 of the TNP which serves OML 53 and through which condensate from ANOH will be exported

Operating profit jumped 76% to US$209.1m benefitting from an FX reversal and a 14% drop in administrative expenses

Seplat’s share price has been strong which we believe is likely to reflect the underlying improvement in operations, imminent start-up at ANOH, and increasing confidence in the completion of the MPNU transaction, whose consummation could drive further upside.

Https://x.com/SeplatEnergy/status/1817935716690645195

Join us for our half-year financial results presentation tomorrow and discover how we've navigated the first half of the year while powering Nigeria for the future.

https://bit.ly/3LE6vG2

I want to congratulate Andrew ‘Benners’ Benbow who recently left as Head of Investor Relations at Genel Energy. Without drawing breath he has told me that next week he starts in his new role as Head of IR at Serica Energy. Now readers know that I am a big fan of Serica and in recent months they have virtually completely changed their executive management team, Dave Latin, having done a great job as interim CEO returns to the Chairman’s office and leaves Chris Cox who has just arrived as CEO. With Martin Copeland getting settled in as CFO and with a great team across the board this looks like the final piece in the jigsaw at Serica and I congratulate whoever it was for hiring Benners.

https://www.malcysblog.com/2024/07/oil-price-trinity-afentra-prospex-petro-matad-star-and-finally-serica-energy/

Https://x.com/surprised_trade/status/1816393683538686070