writser Posted July 1, 2014 Share Posted July 1, 2014 My bad, that looks more likely. Link to comment Share on other sites More sharing options...
siddharth18 Posted July 22, 2014 Share Posted July 22, 2014 Ladies and gentlemen, I present to you, Harry Long: http://seekingalpha.com/article/2330685-awilco-drilling-is-still-the-worlds-most-undervalued-company Link to comment Share on other sites More sharing options...
yadayada Posted July 22, 2014 Share Posted July 22, 2014 oh well time to sell Link to comment Share on other sites More sharing options...
Gamecock-YT Posted July 22, 2014 Share Posted July 22, 2014 He must have been the one pushing up the price the last few days. It ramped $5 last time he ran his seekingalpha piece. Link to comment Share on other sites More sharing options...
peter1234 Posted July 23, 2014 Share Posted July 23, 2014 Why is he looking at individual stocks? I thought he invented this magical money making machine? ;) Link to comment Share on other sites More sharing options...
siddharth18 Posted July 23, 2014 Share Posted July 23, 2014 Why is he looking at individual stocks? I thought he invented this magical money making machine? ;) You mean this ? http://www.amazon.com/Youre-Welcome-Planet-Earth-Powerful-ebook/dp/B00DBT66MI :D Link to comment Share on other sites More sharing options...
siddharth18 Posted July 24, 2014 Share Posted July 24, 2014 http://www.proactiveinvestors.com.au/companies/news/56260/uk-government-launches-urgently-needed-north-sea-tax-consultation-56260.html http://www.ft.com/cms/s/0/45e463d8-0b35-11e4-9e55-00144feabdc0.html http://www.energyvoice.com/2014/07/game-changer-tax-break-boost-north-sea-exploration/ Link to comment Share on other sites More sharing options...
siddharth18 Posted August 13, 2014 Share Posted August 13, 2014 Published: 07:00 CEST 13-08-2014 /GlobeNewswire /Source: Awilco Drilling Plc / : AWDR /ISIN: GB00B5LJSC86 AWDR - Awilco Drilling Reports Q2 2014 Results Awilco Drilling PLC reported contract revenue of USD 66.3 million (USD 62.7 million in Q1 2014), EBITDA of USD 42.4 million (USD 44.1 million in Q1 2014) and net profit of USD 25.9 million (USD 34.5 million in Q1 2014). Revenue efficiency was 99.7% during the quarter (97.2% in Q1 2014). Contract backlog at the end of Q2 was approximately USD 642 million (approximately USD 707 million Q1 2014). The Board approved a dividend distribution payable in Q3 2014 of USD 1.15 per share. The share will trade ex-dividend on 19 August 2014, the record date is 21 August 2014 and the payment date is on or around 19 September 2014. Please see attached for the Q2 2014 report. A quarterly presentation will be held on the 13th of August 2014 at 10:30 CET in Awilhelmsen's offices at Beddingen 8, Aker Brygge, Oslo, Norway. A conference call will be held on the 13th of August 2014 at 13:30 UK time (14:30pm CET / 08:30 EST). The presentation will be available for download on the Investor Relations section (go to "Press Releases") at www.awilcodrilling.com prior to the call. There will be a Q&A session after the presentation. Conference Call Dial-in details: Standard International Access: +44 (0) 20 3003 2666 UK Toll Free: 0808 109 0700 US Toll Free: 1 866 966 5335 Norway Toll Free: 800 19 457 Password: Awilco Aberdeen, 13 August 2014 For further information please contact: Jon Oliver Bryce, CEO Phone: +44 1224 737900 Cathrine Haavind, IR Manager Phone: +47 93 42 84 64 This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. Link to comment Share on other sites More sharing options...
NoCalledStrikes Posted August 13, 2014 Share Posted August 13, 2014 $1.15/quarter... ah, Awilco, the gift that keeps on giving... Reading the materials, but not hearing the presentation yet, I sense they are trying to prepare us for a relatively softer market in 2015. Link to comment Share on other sites More sharing options...
siddharth18 Posted August 19, 2014 Share Posted August 19, 2014 So today's the ex-div date yet the stock is trading at 153 NOK about US$24.82 (compared to previous close of 156 NOK or US$25.32), and adding the div of $1.15, that's almost $25.97 Shouldn't stock drop equivalent to the div value on the ex-date? Link to comment Share on other sites More sharing options...
Palantir Posted August 19, 2014 Share Posted August 19, 2014 I just want to get this straight - even if drilling activity slows down during the term of the contract, they still pick up the contract revenue....and and hence the cash flow right? If that is the case, shouldn't we expect more cash flow due to lower OpX? Link to comment Share on other sites More sharing options...
yadayada Posted August 19, 2014 Share Posted August 19, 2014 I don't get why this is still cheap. It seems these companies are at cyclical tops, and it is trading 5-6x FCF. How do you know they will still print money with these rigs 8-10 years from now? The rig business looks pretty volatile to me. Link to comment Share on other sites More sharing options...
Palantir Posted August 19, 2014 Share Posted August 19, 2014 ^Isn't that all the right reasons for making it cheap? Link to comment Share on other sites More sharing options...
CorpRaider Posted August 19, 2014 Share Posted August 19, 2014 Contract offshore drilling is at a cyclical top? That's news to me. I thought it was in the crapper because of macando and the shale revolution, which timed up perfectly with lots of rigs ordered during that "peak oil" nonsense. Anyone done much work on RIG or ESV? RIG seems pretty interesting. Link to comment Share on other sites More sharing options...
yadayada Posted August 19, 2014 Share Posted August 19, 2014 well rig supply is suposed to be tight, and when I search for dayrates, I see mostly up trending graphs. Day rates are almost twice as high as three years ago. What is stopping new supply coming in within the next 3-5 years? Also it seems this is not a very stable long term industry to be in. So if you are buying at current prices you are basicly saying this is not a concern, but I am not sure why? A cyclical seemingly at or near the top of a cycle at 6x earnings is not very cheap. Link to comment Share on other sites More sharing options...
Hielko Posted August 19, 2014 Share Posted August 19, 2014 I don't get why this is still cheap. It seems these companies are at cyclical tops, and it is trading 5-6x FCF. How do you know they will still print money with these rigs 8-10 years from now? The rig business looks pretty volatile to me. How much they will earn 8-10 years from now is not extremely important. In my model the NPV of the first 8 years is roughly twice the NPV of the last 9 years at a 10% discount rate. At a 15% discount rate the NPV of the first 8 years is more than 3 times as big as the NPV of the last 9 years. Link to comment Share on other sites More sharing options...
yadayada Posted August 19, 2014 Share Posted August 19, 2014 what is your calc npv of coming 8 years then? It seems the past 9 years is irrelevant, what is more relevant is how it compares to the current market cap? Link to comment Share on other sites More sharing options...
writser Posted August 19, 2014 Share Posted August 19, 2014 Back of the envelope: if Awilco maintains the current dividend you run break-even in ~7 years. And that's ignoring the resale / scrap / take-over value of their rigs. They have 4 rig-years of backlog at nice rates and clients have options for 3 more rig-years so you're pretty much guaranteed to receive your dividend stream the first few years years. Everything after 8 years you basically get for free. But granted, it is not the cheapest stock out there anymore after the run-up and if you have a very strong opinion about the future of the offshore business this is probably not for you. Link to comment Share on other sites More sharing options...
writser Posted August 19, 2014 Share Posted August 19, 2014 Also, I don't know what dayrates you are looking at (I suspect US stuff that plummeted after the Deepwater Horizon accident) but I don't see a 100% squeeze in UK dayrates in the Awilco presentations. I don't really have an opinion either way though. Link to comment Share on other sites More sharing options...
Hielko Posted August 19, 2014 Share Posted August 19, 2014 I don't think they will be able to maintain the dividend. They have to spend a significant amount of capital on the upgrades and yard stay in 2015 and 2016. They are only able to generate the current dividend with a high revenue efficiency and low capex. Link to comment Share on other sites More sharing options...
writser Posted August 19, 2014 Share Posted August 19, 2014 That's why I said back of the envelope. I agree the dividends will probably go down at some point but the blowout preventer upgrades should increase the future value of the rigs. Left pocket-> right pocket. Link to comment Share on other sites More sharing options...
yadayada Posted August 19, 2014 Share Posted August 19, 2014 I like pabrai's principle of investing, finding investments with at least 100% upside in a reasonable case. Not sure I see that here. It looked v good at 14$ though. You have to make pretty aggressive assumptions now to get to a double. Allthough I agree that downside seems v limited too. Link to comment Share on other sites More sharing options...
Palantir Posted August 19, 2014 Share Posted August 19, 2014 I just want to get this straight - even if drilling activity slows down during the term of the contract, they still pick up the contract revenue....and and hence the cash flow right? If that is the case, shouldn't we expect more cash flow due to lower OpX? Bump...Anyone know the answer? Link to comment Share on other sites More sharing options...
Hielko Posted August 19, 2014 Share Posted August 19, 2014 I just want to get this straight - even if drilling activity slows down during the term of the contract, they still pick up the contract revenue....and and hence the cash flow right? If that is the case, shouldn't we expect more cash flow due to lower OpX? Bump...Anyone know the answer? Yes, they will pick up the contract revenue but don't think you should really expect that operating expenses will be significantly lower in that scenario. The main issue is that when drilling activity slows down during the term of the contract that the extension options might not be exercised, or that they will be exercised at a significantly lower day rate. Link to comment Share on other sites More sharing options...
bizaro86 Posted August 19, 2014 Share Posted August 19, 2014 Hielko is correct. If an oil company has to pay for the rig, they'll find something to use it on, almost certainly, so you shouldn't model any opex savings. The real risk is if the pricing environment is bad when their contracts are up for renewal. Link to comment Share on other sites More sharing options...
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