Member Info for tonynorstrom1

I know some here are in favour of hiking the dividend increasing the payout above 30% if necessary. The problem with this is if oil was to take a sudden dive south to say $70 - then there is very little cushion if any to maintain the dividend if for example they are already paying out 50% of FCF. With a conservative payout ratio - you have that cushion as well as the ability to payout and excess cash at the end of the year via bonus dividends or share buy backs.

Let’s see what Majid does !

“..its more straight forward doing one every month, rather than an increased 10 months of payments.”

Really strange - what part of monthly dividend dont people understand - a monthly dividend is paid monthly , every month and so unless someone has changed the Gregorian calendar to a 10 month year then we will receive a total of 12 payments in 2023 - never in doubt.

I did run some numbers with Decembers production in excess of 24,000 boepd, 2023 capex at $80m and WTI over $90 - the current dividend is already 30% or a little more of FCF - so I don’t see any massive dividend hike under their current payout policy.

If I were to guess - I would say anywhere between a 0 to 5% increase in the monthly payment probably and 10% max with the possibility of a bonus payment either dividend or share buyback.

I just saw that MEG have increased their dividend and committed to using 50% of FCF for share buy backs !!!

What’s Majid going to do ?

Whether the glass is half full or half empty depends on the attitude of the person looking at it.

I think I’ll just get myself another pint and be careful not to steal the rose tinted glasses left on the bar!

I3e nominated for best Growth Company on AIM

https://www.sharesmagazine.co.uk/awards/nominees

Also absolutely no substance in a two month hiatus in the payment of dividends. Only reason they referred to 10 months is that a decision / approval to go to monthly dividends was only made after the start to the year. There was only 10 months left in the year !!

Cardinal Energy just released its Q3 results - increasing its dividend in Q4 and on a forward yield
Of over 7%. In Q3 it paid out $24m in dividends and $24m in share buy backs - what’s Majid going to do?

No Isdeer - non of its big - that’s why the market cap is £12m. It’s down to what assets they have, do they have a viable development plan, do they have the cash to develop and how long - last point being particularly pertinent in this case seeing that everything moves at a snails pace.

Serif,

Would they have not said that in the update ie average production for the period 656 bopd but currently producing at xyz ? I3e for example give this kind of guidance.

Isdeer,

233 bopd v 257 bopd. Not much of a difference and we’re not even sure that eog produces 257.

So it looks like EOG has a bit more cash £2-£3m - big deal ! Does not mean a lot in terms of shareholder value - you’ve just seen how far £5.5m goes on a Serenity well.

Probably of more interest to shareholders is the potential producing assets - have you done a side by side comparison to understand the valuations?

Well that’s interesting: 656 x 30% = 197 plus the 60 bopd from West Crosby etc = 257 bopd.

What happened to the “well in excess of 300” touted by the pump brigade.

My information is that I3E’s gas is typically sold based on the monthly index which is about CAD 5.35 ($4) for November and CAD 4.50 ($3.30) for the previous month.

Not done it yet - my computer crashed and is in for repairs - hope I can recover the data. Anyway - should be able to do a decent stab at it without the data.

I’ll base it on an estimate of Decembers production numbers (24,500) maybe $95 WTI, $3.50 Gas and a 2023 Capex Budget of $80m and see what that comes out at using say 25% & 30% of FCF.

Stas,

I’ve just run the numbers on the back of a *** packet and made adjustments to the flowing barrel metric to allow for differences in Oil / Gas percentages - I come up with an SP of 37p for I3E - so yes undervalued but somewhat short of the $1.3B you mentioned.

I can share the calculation if anyone is interested.

Stas,

A couple of things to consider:

1) the purchase was in CAD so the metric in USD is about $47,000 per flowing barrel.

2) I3E would not attract anything like this as we are about 50% liquids of which only 20% is oil. The Surge purchase was “largely oil”. I’m guessing based on their base production about 85% liquids including a minimum 80% oil. So more valuable on a per barrel basis as gas in Canada in only currently worth about $20/bbl.

Just saw your post now Stas - yes I should be able to make a decent stab at the dividend based on the latest production figures.

As soon as I get my computer back I will post.

Pmanual - I will respond to your post on cf multiples when I get my computer back and I’ll also post a full year NOI forecast - I believe I should be able to get it within an accuracy of less than $5m now I’ve seen what I had it at Q3.

Shubham Garg should be posting his Q3 update shortly with the valuations of all 50+ Canadian Oilers - it should be interesting.

Whatever methodology they are using - it’s not working.

Hindsight is always 20/20 but I think I have been able to see sufficiently in advance with my own spread sheet that there is a problem with I3E’s forecasting(imo) and so I don’t think it’s just hindsight. The other thing from a Philosophy point of view - Majid has tried to brush it off as a strip pricing problem - actual price is lower than strip hence our forecast is wrong. If you’re just relying on strip then I believe you are going to beat forecast 50% of the time and fall short 50%. With a forecast you want to beating it more than 50% of the time in investing. In science maybe that approach works but in investing - investors don’t take it too well when you fail.

How can you afford all these shares Gusto - it seems there are a lot of idiots in the shares you own and the’re all selling ……..and you’re buying…..hmmm?

GGG - I think you have forgotten that just over 2 years ago - production was zero, debt was $25m, revenue ZERO and the SP around 5p. Windnthe clock forward 24 months and the SP up 5x, 7% dividend yield, production growth in excess of 20% annually going forward it looks like.

“the problem with giving the market time to wake up - it’s never happened in the past” 5x bagger in 2 years and trajectory still up - perhaps you need to give the market more time ?

I’ve not sold a bean - I think the market has got this
wrong and don’t understand the financials in my humble opinion. What has happened here is that I3E have botched the NOI forecast twice in a row - so they have been punished for missing their own forecast even though imo , there’s nothing wrong with the actual or rather updated forecast. The more accurate forecast is still in line with us trading at around 2x CF I.e. a significant discount to peers. All that’s happens here is that some numpty in the accounts department have not checked the spread sheet properly and recorded the wrong number on the RNS - twice !!!

Production growth is excellent and NOI, FCF & dividends will increase at a nice clip - I’m thinking in excess of 20% annually for the next few years - I think it’s more a case of I3E doing a better job on the RNS’s.

pmanual,

Did you see BP’s results - they beat consensus estimates but using your thought process, they should also have missed. There’s only two explanations:

1) falling oil prices don’t apply to BP
2) their forecasts are better / more conservative.

There’s actually a third explanation but I think the two above illustrate the point adequately.