If you think that the deal is too good to believe as how come can enjoy the benefit from these asset eventhough the deal yet to be completely closed. Look at their previous deal on anasuria and North sabah, they also practice the same.
All these info can be found from the announcement report from hibuscuss for this deal. I spent alot of time to study each and after much consideration, I increase my hibiscuss portfolio from 10 to 25%. I not expect the share price limit up or increase alot due to the coming pp concern.
If you look back the previous case when they anoounce the acquisition of North sabah. Its also not limit up but gradually take about 6 month to increare to rm 1. During that period, there's some downtrend to shake out the weak holder.
Ops.. someone message me don't disclose too much as he still not buy enough. Actually no need to worried much, I don't think it will suddenly up alot and may even drop abit. However, for long term, i believe it will gradually up to rm 1 as long as oil price maintain usd60 ++
Jasonn So let's assume they raise 1 more tranche with size same as previous pp, the total shares be diluted about 53% from 1500m+ unit shares to 2300m unit shares. However, the net profit from this deal will be100%. 09/06/2021 8:14 AM
Thanks for info. Just to add, for any new RCPS issued, the new conversion price will not be the same as previous batch of RM0.48 per share. It will be based on the average mkt price at point of new RCPS issuance plus a premium for the share conversion option.
Many thoughts net profit will be 100percent, but all the while, the analysis never use net profit, they use EBT. net profit won't be 100 percent because of high depreciation and debt.
Most important is cash flow and actual money in bank. Remember those days where AA cash flow is freaking high due to advance ticket sold. They grow xtremely huge n gv a big fat bonus. Deprecation is just a number in the book
Over the last 4 years, the company had been on a acquiring spree for new assets, many private placements but the share price consistently around rm1 and below.
Back then, Hibiscus has this mission statement. I guess it didn't achieve.
Mission (2017 – 2021) We have disclosed our business objectives for the period 2017 to 2021. These business goals are repeated herewith: • 100 mmbbls net proven and probable oil reserves/entitlement in existing core asset areas; and, • 20,000 bbls/day net production.
Atm machine purchase completed in end 2021 but economic benefit factor in on 2021. Dependa how much profit/ cash in these asset on 2021, there will be a dividen to be pay to repsol. However, these benefit pay to repsol on 2021 will then be calculated and deduct from the purchase price.
For hibiscus, the oil sold on 2019 is in between usd58 - usd73. Net profit on 2019 is around 180m after tax, interest, depreciation etc. Refer q1 results of these repsol asset, net profit is ald around 50m+. This is the reason why i said net profit will increase 100%.
EBIDA 550m is before interest, tax and asset depreciation etc. However the depreciation is actually none cash deduction, thus the actual cash flow after tax shall be able to stand over 300m. These are just the cash flow from these repsol asset. If include existing business cash flow, it will easily over 600m.
Pls note the capex also quite high. There will need alot capex for the development oil fields in anasuria ( license no p2518 & p2366) which target 1st oil on early 2023. These cash flow from existing business + repsol will sufficient to fund that project.
They also have another major development oil fields project in UK ( marigold and sunflower) which target 1st oil on end 2013. The cash flow from the new development oil fields as above mentioned will then be used to support the project ( marigold).
Daily production out put will be much increase. This is what we can forsee that how hibiscuss grow bigger and sustain their business. If oil price drop in later years, the much increase output will greatly help to mitigate the difference.
Pls note although the benefit of these new asset be factor in on 2021, however it won't be reflect in coming qr. They will need to pay the balance during spa completion. The benefit on 2021 will then be deducted from the balance during spa completion.
Pls note I am not hard sell this stock. Just sharing the information from the announcements of hibiscus. As mentioned this morning, don't expect it will limit up soon due to the PP concern.
We all don't like PP due to dilution shares. However, we need to known where is the money raised from pp used for. For this deal, 50% increase in shares unit to gain 100% net profit is a good deal from my perspective. I actually hope that they can successful get more tranche of CRPS to buy more producing oilfields, just like the repsol deal.
jason, the big issue with hibiscus is the issued new shares are at a much lower price, and as a minority shareholder, I am pissed off. It's worse if those issued new shares were not for the long term investors, but short term player seeking to take profit when they see one, which seems to be current situation.
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Posted by Jasonn > 2021-06-09 08:28 | Report Abuse
If you think that the deal is too good to believe as how come can enjoy the benefit from these asset eventhough the deal yet to be completely closed. Look at their previous deal on anasuria and North sabah, they also practice the same.