bizaro86 Posted September 28, 2016 Share Posted September 28, 2016 Anyone else surprised by the non reaction in the stock today? Nope. The hurdle for LNG was never govt approval, it has always been getting the economics to work to build it, imo. Link to comment Share on other sites More sharing options...
Cardboard Posted September 28, 2016 Share Posted September 28, 2016 I am not surprised by the lack of reaction either since it still requires Petronas investment approval or the economics to work as you mentioned and even with their blessing, revenues are many months away. However, I find it to be a breath of fresh air for the Canadian Government to finally approve something related to energy. Their attitude and lack of support in recent years has been a tremendous obstacle to energy investment in Canada, obtaining proper valuation, getting product to market, etc. Cardboard Link to comment Share on other sites More sharing options...
TBW Posted September 28, 2016 Share Posted September 28, 2016 Would it not be embarrassing for Trudeau to approve and then it not happen? My thinking is the govt must have gotten assurance before approval. I could be wrong. Also I would think this approval also means KMI transmountain will also get approved. Lots of ways to win here. Link to comment Share on other sites More sharing options...
Patmo Posted September 28, 2016 Share Posted September 28, 2016 Would it not be embarrassing for Trudeau to approve and then it not happen? My thinking is the govt must have gotten assurance before approval. I could be wrong. Also I would think this approval also means KMI transmountain will also get approved. Lots of ways to win here. There would be no logic to his party having received any type of assurance BEFORE attaching their conditions. The ball was in their camp and it is in Petronas's now. IMO they made a reasonable move by trying to meet in the middle ground I bought more shares again, but not necessarily because of the news, the valuation remains pretty amazing even sans this project and from time to time I need to scratch the itch... Link to comment Share on other sites More sharing options...
Guest 50centdollars Posted September 29, 2016 Share Posted September 29, 2016 Would it not be embarrassing for Trudeau to approve and then it not happen? My thinking is the govt must have gotten assurance before approval. I could be wrong. Also I would think this approval also means KMI transmountain will also get approved. Lots of ways to win here. They had to approve this. Trudeau was in China 2 weeks ago begging for energy investment. If they rejected this, how would it look? This doesn't mean that it will get built tho. Link to comment Share on other sites More sharing options...
igor Posted September 29, 2016 Share Posted September 29, 2016 Why did the MSA work become money losing in Q2? Thanks. Link to comment Share on other sites More sharing options...
sculpin Posted September 29, 2016 Share Posted September 29, 2016 Good comment from Acumen... LNG: Canada did it! We approved a major project! Sort of. Last night the Feds announced that the final approval has been granted to Petronas allowing the company to construct its LNG plant. But with conditions. Oh the conditions. After reading through the 29 page document last night it was hard to tell if the conditions are normal course or whether they are new and therefore incrementally costly. Perhaps the largest one is the limit on Hot Air emissions from the plant. This project is unique in Canada in that it was approved but had a specific limit on the amount of emissions that would be permitted, a level 25% below the original proposal. We can talk another time about the policy implications of this decision – will Bombardier be subject to a lifetime emissions test on a new plant? How about Maple Leaf Foods on a new slaughterhouse? Why is this limited to energy? Anyways, there are very specific requirements mostly around impact on the natural habitat and some that seem pretty odd like 3D modeling of the silt stirred up by the propulsion systems of tugs and LNG ships. To my untrained eye, the conditions (excluding the CO2 limit) looked mostly doable. Petronas will have to throw these conditions into the investment pot and determine whether the project can bear the additional requirements. They also have to consider whether the market has fundamentally changed irrespective of the conditions attached. Many accounts suggest a current “glut” of LNG but also suggest that the market tightens significantly starting 2020, about the time the project would be on-line if construction started shortly. Link to comment Share on other sites More sharing options...
orion Posted September 29, 2016 Share Posted September 29, 2016 Why did the MSA work become money losing in Q2? Thanks. Was hoping to hear about this in the confernce call. Sadly I missed the conference call and they still link only to the Q1 call on their homepage. Link to comment Share on other sites More sharing options...
TontineCapital Posted September 29, 2016 Share Posted September 29, 2016 They never had a Q2 CC. There wasn't much to talk about, oil companies continued to defer MSA repairs and integrity projects. Apparently poor weather conditions were also a factor. These LNG projects are really just icing on the cake. I believe the real question is what's Macro's value in a market like this and what kind of pipeline MSA revenue can they generate in a $50/bbl environment? They undoubtedly have the balance sheet to withstand a prolonged downturn but what will there revenues look on the other side of this cycle? Is it $60m, $80m or $100m? Its not going to be the hay-days when they were making +$200m of revenue. The price looks cheap on a NAV basis at this level, but on an earning basis it looks expensive. If I double 2016E revenues from $40m to $80m I'm still paying 3.0x EBITDA. This thing has always been a 3-4x EBITDA business given is size, controlling shareholder and cyclical industry. Is that really a deal considering were pretty far off from doubling revenue? We will likely need to wait until FY'18 or FY'19 for +$80m in revenue. Link to comment Share on other sites More sharing options...
TBW Posted October 1, 2016 Share Posted October 1, 2016 Good point. I had been thinking about that myself. But in the case where no LNG happens they then have far too much equipment and cash on the balance sheet. If they paid special div of 22mil (or tender for 50% of the shares) then at 80mil in revs I see them at ebitda of 11mil or NI of ~6mil, would be trading at approx 2x EBITDA and 3.6x PE. And even then would still have an asset rich balance sheet, so I think still quite cheap there. Link to comment Share on other sites More sharing options...
TBW Posted October 17, 2016 Share Posted October 17, 2016 Just noticed that 1.83mil shares traded today! That's 6.1% of the shares. Thats huge for any company. Also interesting that occurred without any real movement in the shares. I would think that means the large seller someone mentioned is cleared out. Would be lying if I said I knew what it meant any which way. Link to comment Share on other sites More sharing options...
sculpin Posted October 20, 2016 Share Posted October 20, 2016 From Cormark... Macro is arguably the most deeply valued name in our universe, trading at 1.3x 2018E EV/EBITDA and essentially in line with working capital per share of $1.40. Work under existing Master Service Agreements is expected to pick up in coming quarters, and bidding activity has seen a modest improvement since the second quarter. While longer-term growth is less visible with the absence of a major pipeline project moving forward, MCR will continue to see some level of repeatable business in facility maintenance and turnaround work. Looking through to 2018, we continue to forecast revenue levels below 2015, but margins returning to historical levels. Some scuttle from a friend who spoke with them recently.... He said they should breakeven for the year, implying fairly good q3 and q4. They are upbeat as they can be under the circumstances RE lng. Think that one of them will come thru. Maintenance and small and medium construction is improving. Said that lots of guys burning up their equipment at losing prices, and it will affect their ability to compete in time. The RBA auctions in Edmonton and Grand Prairie indicate market prices still exceed book values. The RBA people indicated the equipment was leaving the area which is also positive. Link to comment Share on other sites More sharing options...
JayGatsby Posted October 21, 2016 Share Posted October 21, 2016 From Cormark... Work under existing Master Service Agreements is expected to pick up in coming quarters Do they give any reasons for why they're forecasting that? One hypothesis is with the oil prices down everyone deferred maintenance as much as possible. I know at least in the States there are mandates for pipeline maintenance so potentially there's some deferred catch-up. Makes sense that they'd be gaining share from others with weaker balance sheets Link to comment Share on other sites More sharing options...
sculpin Posted October 25, 2016 Share Posted October 25, 2016 From Cormark... Work under existing Master Service Agreements is expected to pick up in coming quarters Do they give any reasons for why they're forecasting that? One hypothesis is with the oil prices down everyone deferred maintenance as much as possible. I know at least in the States there are mandates for pipeline maintenance so potentially there's some deferred catch-up. Makes sense that they'd be gaining share from others with weaker balance sheets From Paradigm earlier in the Fall.... MCR has seen an uptick in MSA work in the third quarter as a result of work that could no longer be put off, as well as some weather-related issues. The company expects Q3 revenue to be in excess of that generated in H1/16 and the positive momentum will continue in the fourth quarter barring additional downward pressure on commodities. MSA will make up the majority of revenue for the remainder of 2016, and MCR is hopeful it will be cash flow positive for the full 2016. Balance Sheet Will Carry MCR Through | At Q2/16, the company had a net cash position of $19.2mm and an undrawn $115mm credit facility, giving it flexibility to pursue large projects once announced. Link to comment Share on other sites More sharing options...
JayGatsby Posted October 27, 2016 Share Posted October 27, 2016 Interesting, thanks. If they do $13M of revenue that looks like ~$1M of EBITDA (based on Dec 2015 when they did a similar amount of revenue). Not amazing but cash flow and positive improvement. Link to comment Share on other sites More sharing options...
JayGatsby Posted November 6, 2016 Share Posted November 6, 2016 Looks like this pipeline expansion will move forward, related to the Woodfibre LNG facility that seems to be moving forward: https://talkingenergy.ca/projects/eagle-mountain-gas-pipeline . Construction will be not too far from Vancouver, so may be further south than Macro would typically go? Edit: Also Cenovus and CNRL announced expansion projects for their oilsands operations (http://www.cbc.ca/news/canada/calgary/canadian-natural-restart-stalled-oilsands-project-1.3835151). Not sure these impact Macro directly either, but positive that there seems to be some capital spending dollars released. Link to comment Share on other sites More sharing options...
orion Posted November 14, 2016 Share Posted November 14, 2016 Does anybody know when they release their numbers? Link to comment Share on other sites More sharing options...
igor Posted November 28, 2016 Share Posted November 28, 2016 Does anybody know when they release their numbers? Well, I sure hope they file something before the deadline on 29th :( Link to comment Share on other sites More sharing options...
orion Posted November 29, 2016 Share Posted November 29, 2016 Numbers are out, still a net loss, but compelling valuation. 48M MarketCap gets you 36M Cash 14M Receivables (after the latest write off/settlement only 3M therof over 90 days) ~4M Income tax receivables/ accrued revenue 47M PP&E (6M land, 13M Building, 3M Automotive Equipment and 24M Construction Equipment) -20M Liabilities. ---------------------- ~80M vs. 48M MarketCap Link to comment Share on other sites More sharing options...
Patmo Posted December 1, 2016 Share Posted December 1, 2016 Those fox LOL Link to comment Share on other sites More sharing options...
60North Investments Posted December 1, 2016 Share Posted December 1, 2016 Cool, reducing option strikes from $3.35 and $2.35 to $1.63.. Same shit that happened at Enterprise Group. Thought these Macro Ent. guys were less shitty, but apparently no? Link to comment Share on other sites More sharing options...
TBW Posted December 1, 2016 Share Posted December 1, 2016 Where are you seeing those restriked options? Looking at recent earnings it all looks fine to me. Infact them taking out the prefs at this level last q I thought was v good behaviour. So would be surprised they did that. Good catch if you are right though. Link to comment Share on other sites More sharing options...
doc75 Posted December 1, 2016 Share Posted December 1, 2016 http://finance.yahoo.com/news/macro-enterprises-inc-announces-stock-215819146.html Corporate governance at its finest. Link to comment Share on other sites More sharing options...
TBW Posted December 1, 2016 Share Posted December 1, 2016 Ah, they didn't even include it in earnings releases. Thats why I missed it. I wonder if that was intentional to mislead? 5.8% dilution on the first good news the stock has had in a while. Totally messed up. Thanks for pointing this out. Also perhaps explains the lack of conference calls. It has been my guess that the CEO may have used the pref redemption proceeds to buy the shares in the open mkt. Would explain that huge print of 8% last month. But I now wonder if he is trying to get to >50% ownership? He had 30% of the shares, still has 3% by way of prefs he still owns. If he did buy in open mkt and I presume most of the options restriked are his, than he is around low to mid 40% ownership now. I would be totally supportive of him increasing ownership here (given how cheap it is) but why just steal some of it from shareholders? Just pure greed. Link to comment Share on other sites More sharing options...
jwfm1985 Posted December 2, 2016 Share Posted December 2, 2016 ridiculously bad corporate governance. Link to comment Share on other sites More sharing options...
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