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I think a lot will depend on the bond's rating. Bonds with a rating below BBB- (on the Standard & Poor's and Fitch scale) or Baa3 (on Moody's scale) are generally considered speculative and often referred to as "high yield" or "junk" bonds.

Given the size of the bond relative to the size of RGL, it's likely that its bond would always been afforded junk bond status (the bond may even be non-rated; I don't think the bond was rated before issue). Furthermore, the bond is unsecured and, as such, a high yield would not be unusual.

I've never bought or sold bonds, so I'm not sure when the discount might normally be expected to unwind.

Bismark, Noted. Revenues may not be as impacted as I'd originally thought.

Gavister, It's not quite that simple. Not all of DEC's wells are producing. At 31/12/2022 (latest figures I can find at present), DEC said that they had estimated PDP reserves of 829 Mboe with a PV10 of ~$6.1bn or ~$65.8 per new share (in layman's terms, the PV10 equates to NAV). DEC doesn't disclose in its accounts how many unplugged wells it has but I believe the figure may be in the region of 65,000. If the present value of plugging costs are $100k per well, rather than $21k, then DEC's PV10 might be expected to decline by ~$5.1bn or ~$55 per new share, all other factors being equal (which would broadly mean the NAV would be ~$10.8 per new share). If the plugging costs were $125k per well then DEC would have a negative PV10, all other factors being equal i.e. it might be insolvent. It should be noted that the PV10 calculations are susceptible to oil/gas price movements.

Please note that DEC doesn't set out its PV10 calculations in any detail (I can't even confirm from the accounting disclosures that the present value of DEC's average plugging cost estimate is $21k per well or that this is the figure that's being used in its PV10 calculations; DEC hasn't fully provided its expected future plugging costs accounts and I haven't been able to find any disclosure in its current accounts to confirm that the calculations are based on $21k per well but that does appear to be the generally accepted figure). So, if I have erred in my calculations I apologise.

PS. I don't personally believe that DEC's average plugging costs will be in the region of $100-$125k per well but it's certainly feasible that they could be in $40-$50k range. DEC's current figure appears to be at the very lower end of the potential price range (if not a bit below) and, on that basis, I think it's perfectly reasonable that people should be questioning DEC's figure (if nothing else to satisfy themselves that it is actually achievable).

Be honest Trek, do you really think that DEC's rebuttal letter has put the ARO question to bed? I didn't see anything new in the rebuttal letter that DEC hasn't said before.

The letter conveniently ignored the fact that the average cost of retiring their own wells during the period referred to in the letter were 19% higher than their projected ARO costs ($25k vs $21k). The letter also seemed to imply that the costs might not have included any earth moing/excavator costs because they'd been able to borrow the plant from other parts of their operations. Utilising plant in this manner is perfectly acceptable but there should be an internal, "market-rate" recharge, particularly if it's not going to be a long-term option. My expectation would be that as its oil production winds down over time and its plugging activities increase it's going to have to either buy or hire plant to undertake the plugging operations (so a cost saving now doesn't really give an accurate picture of what its costs might be in the future). I think DEC does need to do more to justify its expected future ARO costs and, if appropriate, explain what economies of scale may come into play furthe down the road (puchasing power is unlikely to be a major factor in the future because they should be able to realise most, if not all, of that benefit now from taking on third party work).

There's also the pertinent question of whether or not all of this adverse publicity will enable DEC to continue deferring its existing plugging obligations and/or whether previous agreements will be revisited. My current take is that DEC already has a lot more dormant wells than its currently plugging and that, by agreement with various state bodies, it's been permitted to defer plugging those wells to build up its cash resources. If those agreements are now revisited then that could create a major problem (the only way DEC could afford to materially increase it's current plugging rate would be to cut its dividend and/or borrow more money).

PS. Given the hedges that DEC was able to renegotiate in 2022, 2023 results should invariably be good (certainly compared to 2022) but the benefit of those higher hedge prices is going to start dimimishing from 2024 onwards and, given that the HH spot price has, for most of 2023, been below $3, the opportunities for DEC to have achieved equally favourable hedge prices for 2024 and beyond would appear unlikely. Obviously their hedging positions are built up over a number of years and results should not necessarily "fall of a cliff" in 2024, albeit that it appears likely that their average hedged price will now be lower than 2023, but the longer the HH spot price remains below $3 the worse future years will become.

I don't know whether there's any merit to Snowcap's comments on the gas price DEC "needs" but at this moment in time the HH spot price is definitely on the wrong side of $3.

DEC's closing price on the NYSE was actually lower (about 17.5p give or take) than its closing price on the LSE today (based on the current exchange rate of $1.27 to the the £1).

Really? You two must live in a closet if you think that LSE is alone in seeing wild price fluctuations.

Remember GameStop? People seem to forget that the value of the so called "Magnificent 7" actuallyt fell 39% in 2022 (that's $trillions); since then they have collectively recovered and at the end of 2023 were worth about a $trillion more than they were at the start of 2022. Have you never read headlines about Musk losing $billions in a day or the daily travails of bitcoin investors? At the end of December 2022 bitcoin hit ~$16.5k and looked to be heading further south. It now trades at ~$40k.

The markets can be very unforgiving places and the LSE is most definitely not alone.

PS. JD Sports crashed and burned becasue it made a major boo-boo; it stocked up big-time on Nike's new retro Tech Fleece thinking it would fly off the shelves at £120 each. It didn't and JD Sports was left with large stocks and forced to discout it (in competition with Nike's own direct-to-consumer channels). Big picture, Nike is increasingly looking to try and cut out the middleman and this fiasco has raised fresh concerns about JD Sports future relationship with Nike; JD Sports heyday might have come and gone. Bottom line; if JD Sports needs its high-end suppliers more than they need them then JD Sports may have a big problem (I'm sure the likes of Nike, Adidas et al would much prefer that £900m of profits sitting in their accounts rather than JD Sports). You just have to look what's happened to Currys & PC World to see what could happen to JD Sports (Currys only still exists because the likes of Sony, LG etc. need a shop window for their goods but make no mistake it's Sony, LG etc. who call the shots and decide whether Currys makes a profit of not). Some investors are concerned that the "fat times" may be over for JD Sports.

Yeah, he's thinking of renaming the company AbErdEEn plc ;-)

TerryM1, To be clear, I'm not saying that SnowCap report is (neccessarily) flawed. I'm saying that it is (clearly) self-serving. DEC is not the first company to come under short attack like this and readers of the report have to recognise that Snowcap is not a disinterested spectator. At least they clearly state that they are shorting DEC. Lies, damn lies and statistics; make of it what you will.

I think the BOD thinks that if they say and do as little as possible the problem will eventually just go away i.e. that the proof is in "the pudding" (namely the results). That sometimes works if you completely trust the BOD but trust in Rusty has now been (seriously) undermined by these constant attacks and questions about their reporting continue to persist.

Personally, I thought the rebuttal letter to the congressional sub-committee was weak (it just seemed to re-hash previous statements and didn't really bring anything new to the table). Either the BOD aren't taking this seriously (a mistake IMHO) or they simply don't have any answers.

Significantly increasing their buy backs aren't the answer. They don't have the surplus cash and increasing their borrowings at this juncture would not be a good move. Buy backs might placate some shareholders but from a commercial perspective would be a disaster.

My initial read is that Snowcap's report is a bit self-serving.

Firstly, their analysis of the decline rate is as flawed as (potentially) DEC's. They are relying on production figures to support their decline rate whilst ignoring the fact that DEC has invested in technology to vary production +/- 10%. You can't simply look at production without considering reserves (albeit that reserves are always questionable e.g. if you believe the Saudis then their reserves would appear to be infinite) and also the foregoing spot price. Part of the reason that DEC invested was to avoid selling more gas than they needed to when prices were low (which they have been).

Secondly, when analysing the free cash flow they've relied on cash from operations rather than EBITDA. Both measures are potentially flawed. Under IFRS, cash from operations includes movements in trade debtors/creditors. I've argued with Ace about this before and won't go into the details again but essentially its a use of operating cash rather than arising from the operations and can easily be affected by the timing of payments and receipts at the end of the month, quarter, year etc.

However, that said, the debate goes on. I've said it before, and I'll say it again, IFRS makes DEC's figures as clear as mud and really doesn't help understand what is going on. Having seen that sudden fall with no apparent explanation just after 12pm, I'm just glad that I'm now on the sidelines watching on.

I just noticed that myself. Out of a clear blue sky it just dropped like a log! It's continuing to drop. News incoming? Big sell? Very unusual to see such a rapid drop in my experience

Bismarck, Market manipulation cuts both ways or are you suggesting that you'd never find people buying shares in advance of news based on insider information? I'm not suggesting that market manipulation or trading on insider information is ever acceptable, I'm just pointing out that there can be genuine bears (shorters) like there can be genuine bulls.

The real issue is that the stock markets are essentially a binary systems (if you ignore neutral, no change) and whilst there's a transparent method to go long (buying shares) there isn't really a transparent method to go short and people get unduly hot under the collar about shorters' "nefarious" dealings when, at the end of the day, it's only human nature for people to hold different veiws.

Why should shorts be made illegal? It's daft. Why do some people have such a problem with other people who think that the share price will go down? You may as well ban longs whilst you're at it! At the end of the day, most "investors" are just gamblers, plain and simple. Okay, I can understand why people don't like "naked" shorts but people who have a beef with shorters in general are simply afraid to admit that the shorters may actually have a point; it's not the shorters who drive the price down per se but all of the "investors" panicking and selling up. If you want to stop a short attack, buy more ;-)

Over the next 8-9 weeks TFIF is going to need to grow its NAV by c5p+ (about 0.6p+ per week) if it's going to cover it's final expected dividend without impacting it's current NAV after it goes ex-dividend. Part of that growth should be delivered by the coupons paid on its bond portfolio in the intervening period. Assuming it coupon income arises even over the year, it's already carrying c2.5p of unpaid dividends within its NAV (assuimg it's annual dividend will 11p+). Interesting times.

Sorry, I'm at a bit of a loss.

What do personal independance payment (PIP) claims have to do with Aviva? They are a state assessed benefit.

Considering the current economic backdrop and the impact of minority interest accounting on the results (including the cost of acquiring the remaining interest in ProTiler being expensed to the P&L), the last results were actually pretty good. TPT is not immune from the economic headwinds but, despite the tile market contracting, TPT has managed to grow its market share. Also, the fact that gross margins have fallen is somewhat misleading; the ProTiler brand actually delivers similar operating margins to the Topps Tile brand. When, as expected, TPT buys out the remaining minority interests in ProTiler at the end of March there will be an immediate boost to both PBT and EPS (even if FY24 results continue to slide). Furthermore, TPT has a healthy amount of cash and continues to be cash generative.

When the economy begins to rebound TPT will be in a very stong position. FY24 may prove tough as last year's inflationary rises really start to bite and people start to tighten their belts still further (as the recent Q1 update showed) but TPT is well placed to benefit from any future uptick.

I'm really not sure what you expected from last year's results unless you expected TPT to hand its profits to MS Galleon on a plate! MS Galleon clearly has an axe to grind (it wants all of the benefits of outright ownership without the associated cost). What's your beef?

Why don't you do some research before you post?

The directors' remuneration (including LTIPs) was c£1.7m or c0.6% of turnover last year. The reason that there was such a large vote against their remuneartion package (and the head of the remuneration committee) can be summed up in one shareholder - MS Galleon - who owns just under 30% of the shares and wants to dictate who TPT buys their products from without actually paying the premium needed to acquire a controlling interest.

If MS Galleon had their way, TPT would now be buying c30% of their tiles from MS Galleon and no doubt diverting profits from TPT to MS Galleon in the process. The other c70% of shareholders told them where to get off last January and it still rankles with them. If you think the results are less than stellar in the current economic environment, think how much less stellar they would have been if MS Galleon had successfully diverted most of the profits to themselves!

I think Weichai is a busted flush. It's been draggings its feet for far too long. In my experience this is par for the course for prospective Chinese partners; they want the technology without paying for it. CWR needs to be looking for commercial deals elsewhere. If Weichai gets on board at a later date fine but we shouldn't continue to pin our hopes on them.

I would say that the Berenberg analyst sounds pretty clueless. DLG has been the cornerstone of a lot of investors income portfolios and its shareholders will be very disappointed if it opts for share buy backs (which are proving to be of dubious value in the current climate) rather than re-instating dividend payments. Obviously the earnings dilution from the sale of the commercial business can't simply be ignored and nobody now expects the dividend to be reinstated at the previous level but DLG should be able to manage a dividend of (say) 10p per annum for FY24 if it can continue to make progress on its motor insurance pricing following the debacle in 2022. It has some strong brands; it now needs to leverage them.

It would appear that the FCA doesn't regulate companies listed on AIM it only appears to regulate the Main Market).

AIM companies are supposedly regulated by the LSE.

Directors (including CFOs) are generally permitted to sell outside closed periods (the time between when a company finalises its financial results and when it releases those results). Share options are usually granted and/or exercised following the release of those said results (because they are performance related).

Outside of closed periods, unless the directors become privvy to other specific insider information e.g. takeovers, share offerings etc, they are permitted to trade their shares like normal shareholders.