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8 comment(s). Last comment by zhangzuode 2022-03-04 09:05

rattynz

73 posts

Posted by rattynz > 2022-03-01 23:26 | Report Abuse

Very interesting observations.. If lower production of 15% is coupled with higher oil prices of 17% the the nett affect would be canceled and the eps should be similar to your previous estimate I beleive. So a 29% drop doesn't seem to make sense there.. Repsol was also funded from the crps allocation (around RM197 million).. I would have expected, with retained earnings and Q1 and Q2 2022 profits would more than cover the trafigura credit line.. Perhaps you can check the workings as it doesn't quite make sense.. Would love to know the upside if oil remains at 100 for the rest of the year.. It was interesting in May as TP assessment that from every dollar increase (above break even I assume) hibiscus profit ranges from 36 to 54 % (after tax).. So a prolonged hike in oil prices will have a significant impact/upside to their Profitability..

rattynz

73 posts

Posted by rattynz > 2022-03-01 23:46 | Report Abuse

Maybanks TP assessment.. I meant

zhangzuode

162 posts

Posted by zhangzuode > 2022-03-02 09:11 | Report Abuse

rattynz, thank you for reading.

Between EBIT and Profit before tax, there is finance cost. There is no information on exact amount used from Trafigura's line, 70 million was allowed. This, thus, complicated the calculation. Apology for not showing this. Hope this clarify.

There is another issue that bugged me:
As a non-finance person, my thinking that the NAV in all reports (including the proforma) remains around 70+ sen is most unusual. From my limited business days, whenever I want to increase my revenue, I need to increase my assets to make it happen, that is, my NAV increases (OFC less any liabilities used to increase the assets).

So for Hibiscus, NAV to remains at 70+ sen but with production tripling, it is a miracle. So this coming May quarterly report will be most interesting.

wynwyn

136 posts

Posted by wynwyn > 2022-03-02 09:54 | Report Abuse

Can i3 bring back the old interface pl

rattynz

73 posts

Posted by rattynz > 2022-03-02 10:29 | Report Abuse

Yes - the current NAV is based on life before Repsol and before the recent increases in oil price. with next quarters results I expect this to be recalculated and even if you were very conservative it would double. The 70 Million for Trafigura does seem very high. The financing costs for the credit line are low - around 6% PA I believe. So perhaps you might want to consider the interest costs on the credit line only (which may be around RM5 Million). They also have additional cash reserves of RM550 million at Dec 2021 so the credit line is more than covered and I imagine would be a long term liability in their balance sheet.

zhangzuode

162 posts

Posted by zhangzuode > 2022-03-02 11:19 | Report Abuse

Indeed, 70 million is a bit excessive now come to think about it.

That was my premise when I said Hibiscus buying Hibiscus when the Repsol deal was announced. Should the NAV goes near 1.40, then paying two times book value will mean Hibiscus price could be 2.80

This would mean 17 (earning) / 280 = 6.1% return.

zhangzuode

162 posts

Posted by zhangzuode > 2022-03-03 07:52 | Report Abuse

Export from Russia grinding to a halt:
https://www.zerohedge.com/crypto/70-russian-crude-trade-frozen-surgut-...

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