Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Oh yes.... Market manipulation... The usual refuge of a private investor who thought he was about to make a quick buck and now is now nurturing a paper loss instead ..... The company made £40 million FCF in the best year ever for online retailers when their competitors with physical stores were actually prevented from doing business... Going forward, with the supply chain issues and cost of delivery going up how loyal do you think the teenage girls will be to this brand? Loyal enough to be spending £10 for each delivery?
13 % down on such strong results so far....
Yes and immediately crash the world's economy resulting in oil trading in the $50s again.... Click bait recycled articles not worth paying attention to.
This has aged well.......
Indeed classic example of sell the news ... there is nothing significant to look forward to here over the coming weeks and possibly the ned of the year - all the important news out there already and this will simply follow oil price now . Despite all the excitement on this board yesterday the market took the half year results with a simple "meeh ". Most oilers are up 4 % - 5% over the past 2 days on the back of rising oil ...Tullow is currently 2.7 % up so no sign of "BOOOOM" on results ... traders see that so they simply sell out and move on to something else ...
if your answer to any pullback in the SP is always "shorters, MMs and manipulators " you will not make money in this market ......
Unfortunately there is limited benefit for TLW from rising oil this year with 40k of production hedged at $67
Debt was 2.2 billion at end of 2020 and now is 2.3 billion so how exactly is it down?
There are no nasty surprises:
-production slightly up but that's due to defferal of the maintance job to 2022
-FID on Kenya and commercial partner expected by year end
The worrying thing is in 2021 there will be a minimal change to the debt position.
With $61 realised oil price in H1 and assumption of average $70 in H2 they only expect $75 million of FCF for the whole year (excluding the one off $75 mil payment for Uganda). So at current production levels the true breakeven is at low $60s oil ( in contrast to misguided people who claim "TLW is making a lot of cash at these oil prices). The production needs to increase to 80k + and fast if they want to chip away that mountain of debt.
Will you refund people if it drops on results?
It is true, TLW has made a lot of progress in the past 12 months but things are not as rosy as some people want you to belive. They need to convince the market that they can start increasing production again and this is something I will be looking at closely in the results. As to why TLW has dropped over 30 % since the recent highs.... The simple answer is the SP got waaay ahead of itself - this was partly because of very quick recovery in oil prices and the fact that no so long ago everyone thought that $80 oil was just days away. Not to mention the fact that production has been revised down again since the highs so saying nothing has changed is simply not true. The thing with small to medium oil companies now is that "no further bad news" is simply not enough. TLW has to announce something positive next or otherwise you will see a drop on the day.
Or maybe it is just a sign of what's to come bearing in mind TLW dropped on every single trading update since November 2019
Ammu was right... The results did " set fire to the sp"... Just in the opposite way he had hoped for.....
As usual the only expectation I have is for you to get it completely wrong since 95 % of your daily predictions never materialise...
You realise there is absolutely no capital for that and they would certainly face opposition from the creditors?
Would love to hear how you arrived at that valuation? Perhaps you can give an example of another mid size oiler with market cap of only 1.5 x FCF?
How do you feel after telling exactly the same thing to people when the share price was hoovering around 60p?
Another "stressful day unrelated to stock Jubileey" ? :)
Yes capdaildrip it was overvalued at 17p at some point last year and it was then proven to be correct when it dropped below that level around autumn. Valuations change in line with changes in circumstances. when there was a positive change I was happy to invest in Tlw around 20p.
At $60ppb they are left with approximately $35 million of free cash flow for the year from production ($400 million pre finance cash flow - 290 million financing costs and - 75 million one off Uganda profit). The worrying thing is a $10 increase in price of oil only generates and extra $50 million of free cash flow (2 or 3 years ago a similar increase would generate an extra 100-150 million) . Everyone who thinks that Tullow is making big bucks with oil in mid $70 should think again. They may be able to take off $100 million of their debt this year. They need to really bring production back up to 80k+ before there is anything left for shareholders.