Member Info for TrekMadone

It’s the hedge break even price and volume sold that is important. Ergo the ability to pay debt, dividends and make acquisitions.

The relevance of a higher gas price is it makes acquisitions more expensive. A lower price like that of the last year stresses unhedged producers and makes acquisitions ‘cheaper’.

So ironically our model differentiates us from the pack in a low gas price high demand environment.

When gas prices are higher that’s when we are not as ‘sexy’ compared to the unhedged brigade. But we still pay a dividend and manage our debt reduction irrespective of gas prices.

The DEC investment case is there in plain sight for all. Whilst we may not deliver the huge upsides of others in more buoyant markets investors still get their capital back in 5.5 years through dividends at the current yield.

It’s just a fact of life that if something seems too good to be true the old adage says it uses so you gotta keep proving it works!

At every set of results since IPO DEC have paid the divi, paid the debt and put out explicit and detailed investor comms, supported the company with significant director holdings but still we gotta keep proving the model. And that’s absolutely to be expected with a 15% yield!

I am looking forward to tomorrows interims to again prove the model works. But I am also excited by the supplementary presentation that I think will announce another acquisition of around +$200m with lots of cash and part debt! A biggie!

Let’s see!

Usual caveats

Trek

Folk probably bought for results expecting transformational news get bored even though we had fantastic news but the price never sustained a reaction.

The fact remains we march on with medical equipment sales and a phase 1 soon to be phase 2 clinical trial with significant unmet clinical needs. And that really isn’t doing the company’s prospect anywhere near the amount of justice deserved! So DYOR!

We also continue again without needing to raise cash. I suspect we had an upfront payment for IB as part of the confidential financial terms.

SP may drift back to 3p but could also go to 8p in a blink if we get more news. This is just one of those companies where you have to DYOR and average in gradually over time to build up a position.

I will be using some divi cash to buy more later as I view some of that as ‘play money’.

But I am pretty confident that this is the real deal, an elusive multi-bagger. I was sat in ARB for over two years while the SP languished around 4p and then pop!

The reason was the market didn’t believe they were generating revenues even though all the signs were there. Then boom! And I exited gradually on the way up selling most too early but the last few at 150p!

I see similar signs here to that of AVCT, SNG, SAR & HEMO in the early days. All of which I traded well even made a killing on DDDD!

The ingredients are here, beyond doubt imo. They will be mixed soon but how far the cake rises is anyone’s guess as there is no guarantees in clinical trials or for that matter device sales.

Look at IMM and SNG now but boy didn’t they run ahead of readouts! Or LID and HZD both I held and were taken over for their medical tech.

If this is still going as a stand-alone or with a JV into a phase 3 trial it will very likely be far north of 50p a share!

All you gotta do now is buy and wait patiently. There will be plenty of opportunities along the way to get a free carry and that is pretty much essential no matter what pound signs you sign on the road ahead!

I haven’t seen anything in the latest news to give concerns around operational progress or financial funding here. Far from it the story looks very positive. It’s just the usual apathetic SP.

But remember the SP moves on low volumes. Just 2% of shares traded can send this up or down +20%! The markets don’t reward anything for hold. London doesn’t get paid for zero trades! Hence it’s all geared to generate volumes of trades so the markets get paid!

Just gotta put money in you don’t need, keep researching and wait patiently. It’ll come!

Usual caveats

Trek

Ignore google. Dummy trade for 5k is 93 to sell 95 to buy. Will move a bit but I think the investors here will be well pleased if we end the day like that!

We actually could end unchanged! Or up 2.3 however you look at it. But if there is better than expected news tomorrow this could do 10% easily imo!

Question is ‘what’s expected’, fkd if I know what the market expects here anymore! Lol!

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Trek

M4 down rates up = stagflation. Also BoE bond purchases for QE following GFC are now significantly in red!

“ The money supply in Britain’s economy has stopped growing for the first time in at least 13 years, deepening concerns that the UK faces a recession.

Bank of England data showed that a closely-watched measure of the levels of cash outside of banks was no higher in July than a year earlier.

The halt in growth of what analysts call “M4” money - the first time that has happened since at least 2010 - has sparked concerns that the UK is on the verge of recession.

Monetarists argue that the surge in money supply in 2020 and 2021, fueled by quantitative easing to support the economy, helped to cause the jump in inflation, although this is disputed by the Bank of England.

Former governor Mervyn King told Bloomberg last month that the central bank’s rate-setters were ignoring warning signs in money data.

He said: “The risk is that having ignored money when inflation was rising, they’re now ignoring money when inflation is actually about to fall.

“If they carry on for the next six months or so, tightening monetary policy, it could well be that they generate both a recession as well as a sharp fall in inflation.”

The Bank of England has raised interest rates for 14 consecutive meetings from 0.1pc in 2021 to 5.25pc today in a bid to tame runaway inflation.

Money markets expect policymakers will raise rates again at their September meeting to 5.5pc.”

Source DT

Higher interest rates will force the Bank of England to make a loss of £150bn from the sale of bonds bought to shore up the UK’s financial system over the last 14 years – an increase from a £100bn deficit projected in April.

The bill will need to be paid by the Treasury out of current spending, hitting Whitehall departmental budgets, after successive chancellors failed to set aside funds to cover the losses.

Officials at the Bank expect the government to pay about £40bn a year in 2023, 2024 and 2025, roughly £10bn a year more than estimated in April.

Last year, two of the Bank’s former deputy governors suggested it should force bond buyers to accept a lower interest rate to reduce the Treasury’s bill, but this was rejected by the governor, Andrew Bailey.

The problem stems from the quantitative easing scheme that began in 2009 and has involved buying £875bn of government bonds from banks and other financial institutions.

A decision to forward the funds to the Treasury meant the government had gained about £124bn from the bond purchases by 2022. A move to set the money aside in a separate account was scrapped and the funds were used to reduce government borrowing.

Higher interest rates reduce the market value of the bonds the bank holds and increases the interest it pays to commercial banks that will buy them over the next 10 years. The interest rate has risen from 0.1% in December 2021 to 5% as of June…’

That’s a strong move today up 3.25p atm with the indicative sells ahead of buys by about 40% (£200k) albeit volume is comparatively low.

MM’s are collecting shares for some reason.

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Trek

PlayingFTSE,

That’s the page I am on likewise with everything crossed!

The 6 month interims will be available pretty much followed by a supplementary presentation. The last supplementary presentation was for the Tanos acquisition.

They raised cash for the last acquisition and it didn’t go down well with the market. Irrespective of the benefits & why’s it seemed to inextricably coincide with the SP decline from the 105 down to 85p.

Since then they have raised cash through non core asset divestments ($56m) and improved RCF($100m from memory) with the banks. They also have cash available for a buy back that appears to have been sidelined ($97m)

That all adds up to a huge non dilutive cash pot! I get one can argue debt is dilutive but they could still pick up assets even without using the RCF.

The market has been pretty brutal with DEC and I have no idea if it will warm to another acquisition or not. I guess it depends on terms.

Regarding a US listing. The idea is that is it opens the stock to a wider investor base. Will it result in a rerate though. I have no idea. There are lots of high yielders in the US.

I think growing the mcap is probably key to forcing index funds to buy. Also getting a CDP climate change score sits well with some investors. But others avoid HC’s even if it is a transition fuel even though when you lift the bonnet on renewables it’s not all it’s sold to be!

Usual caveats

Trek

My jibe was at those who oftentimes sell before an xd hoping to buy back thereafter cheaper. Or those that hold for the xd and exit thereafter.

Hence the traders conundrum with the results on Friday.

Makes a change for those with a longer term invest horizon that expect to suffer a period of SP pullback after xd.

Well done monkey, amazes me that the Lgen and Av BB’s are busier than here when PHNX has probably the more secure prospects.

I thought about selling some more if it cleared my new average and buy on a pullback but it’s just too difficult, well impossible to gauge. At least at this sp level!

Better off putting new money in that you can afford to tie up and then taking it back out once in the clear. If you get caught out it should still go on a run this close to xd so it’s a pretty balanced risk reward trade.

At this price I also wouldn’t surprised to see one of the bigger insurers come sniffing. These businesses are pretty easy to rebrand and bolt on!

Usual caveats

Trek

Results come day after xd. Is that a conundrum or just a lol!

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Trek

Thanks John I didn’t realise Casca was fixed thought was just coho!

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Trek

Huge trade for £8m gone through. Not seen one here that size for a while.

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Trek

And the two extra Coho wells!

Once we get Casca flowing each drill thereafter should be a production well drill that just adds cashflow.

Royston is a bonus if it comes in but as it’ll be trucked it just doesn’t compare to gas straight to infrastructure. Also Casca will be $ at the well head.

The macro outlook for gas atm is pretty positive and it’s near the bottom of its trading range. It could go easily from 2.5 back above 6 bucks! The market will price TXP at 2.5 plus the fixed rate for coho. But if we get a price spike in gas prices in the winter when Casca is on line that could more than double our revs in a blink!

It’s a pain atm but once Casca is pumping we will reap the benefits of having a brand new production well in a stable geo with an all you can sell direct route to market!

The story here is hopefully about to improve significantly!

The obvious temptation will be to sell some after waiting so long but the real share price drivers are ahead and they are much lower risk compared to where we have come from!

Usual caveats

Trek

Chevron LNG Nearer to Strike

Another group of workers authorizes walkout

A third group of workers at Chevron’s major liquefied natural gas facilities in Australia just voted to strike – joining two others that had already authorized such action – that could disrupt the supply of the super-cooled fuel if the strike does take place, as Lewis Jackson reports here.

Chevron’s Gorgon and Wheatstone facilities in Western Australia, along with Woodside Energy Group's projects in the same area, account for about 10% global LNG supply. Australia is the world’s biggest exporter of the fuel, which is used primarily in Asia and Europe for power and heating as many nations attempt to reduce their reliance on coal or oil. The 37 workers at the Wheatstone offshore platform that decided in favor of industrial action now make it more likely a strike could take place.

The Offshore Alliance (OA), which combines the Maritime Union of Australia and Australian Workers' Union, now has the mandate to engage in stoppages – though they are not obligated to do so. Last week, more than 99% of the 450 or so workers at Chevron's Gorgon LNG facility and Wheatstone's downstream processing facility voted to allow unions to call strikes.

From Reuters Power Up email

Trek

Nailed some trades at PHNX. Bought 7 lots to bring my average down to 523 and then pulled them out with an aggregate profit and added to DEC below 90p! DEC XD Thursday.

Intend to hold both positions now even if they go a bit lower as I think that’s gonna be close to the bottom for a good long term yield.

Was hard work but the dip last week provided a trading opportunity!

Usual caveats

Trek

Took out my float at here 518 leaving me with an average of 523 for a good size holding. That’s a trading profit on the average of my last 7 buys that I used to average my position down.

Took the proceeds and invested into DEC at 89.7p average. They go quarterly xd on 31st. That’s a buy there pretty much on my average for my existing holdings.

Comfortable with both positions now but hope to add again here later if trades elsewhere come off.

Be great if I can add below 535 as I see a run here ahead of divi and a reasonably quick recovery thereafter. Aviva just recovered xd pdq.

I think anywhere below 535 here could still be blue after the next divi payout and then the stock usually recovers over the winter.

Some good commentary in the interims and this could pick up very quickly. Downside is probably 500p with a slow recovery back up if they hit lower end of guidance.

This can be a very good income play if you can work your average here.

Usual caveats

Trek

Copper: Officially a US Critical Mineral

Given the key role copper plays in the energy transition and uncertainty surrounding its future supply, it would be safe to call the red-colored metal a “critical mineral”. Yet in the United States, that hasn’t been the case, at least until recently.

According to the US Geological Survey, a “critical mineral” must meet the following three criteria: 1) It is essential to economic and national security; 2) It plays a key role in energy technology, defense, consumer electronics, and other applications; and 3) Its supply chain is vulnerable to disruption.

While copper qualitatively does satisfy all of those, quantitatively though, its risk score has been below what the USGS uses as a cut-off, rendering it somewhat of a “pseudo critical mineral”.

But that all changed on July 31, 2023, when the US Department of Energy (DOE) officially put copper on its critical materials list, marking the first time a US government agency has included copper in a “critical” list, following the examples set by the EU, China, Canada, and many other major economies.

Also included in the DOE’s list are aluminum, cobalt, copper, dysprosium, electrical steel, fluorine, gallium, iridium, lithium, magnesium, natural graphite, neodymium, nickel, platinum, praseodymium, terbium, silicon, and silicon carbide.

https://aheadoftheherd.com/copper-now-classified-as-us-critical-mineral-and-rightly-so-richard-mills/

Trek

Fed spooking markets! Inflation too high and will keep raising rates as much as necessary.

That alone will boost USD.

Markets will absorb next week imo.

Last lot at 505.8!

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Trek

Could be perfect timing. Got my average below 525 here now having committed all the firepower I could muster!

Convinced we will see a run up in sp ahead of xd.

Buying now could just afford a cushion below the xd price so one can if one chooses take the divi and also offload some at a profit thereafter leaving the rest in with a nice low average.

Nov to Feb is usually a good time for markets and surely the fed would have finished its demand destructive rate rises by then!

It seems a long way off now but things could settle before Christmas meaning now is a great buying opportunity. There’s a lot of bad news in the price from the 640p highs this year down to 510!!

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Trek

It’s about time PB under promised and over delivered. He will have a chance next week.

You’d think he had an inkling that we are a little vexed and it’s his opportunity to get some cred!!

Once we get the numbers from Casca then we can aborb ourselves in the story about what they have achieved with covid, inflation, politics etc etc…

I’d also like to know in addition to coho what’s next ops wise and when.

Usual caveats

Trek

It’s a great trading stock as good liquidity and high vix.

Defo one for tro’s cnbc tracker!

I would have grabbed under 100 if had funds and sold the bounce. Just take nibbles. If you get stuck it usually comes back.

Any market positivity like winter volumes and it goes back up pretty quickly. I have traded it lots in the past.

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Trek

SWG….+18%

“ Shearwater Group has now received a number of delayed contracts and said revenue for the first quarter of the year has beat that for the comparable period a year earlier.

The London-listed cybersecurity company said Friday that it is confident fiscal 2024 earnings will show an improvement over fiscal 2023, as it benefits from more favorable market conditions in the software sector and investments made in that division.

Shearwater expects to report earnings for the year ended March 31 on Sept. 5, it said. The earnings have been delayed due to the audit process as previously disclosed.

On June 8, the company said fiscal 2023 revenue was expected to be around 27.0 million pounds ($34 million) and adjusted earnings before interest, taxes, depreciation and amortization was expected to be around the GBP4.4 million reported in fiscal 2022.”

Trek