Vermilion Energy - Termination of coverage

Edison Investment Research is terminating coverage on Diversified Gas & Oil (DGOC), Vermilion Energy (VET) and Circle Property (CRC). Please note you should no longer rely on any previous research or estimates for these companies. All forecasts should now be considered redundant.

Vermilion Energy - Back to basics

Vermilion Energy’s geographically diverse portfolio spreads geopolitical and pricing risk across different economies. The company has grown both organically and inorganically, and has delivered on environmental, social and corporate governance (ESG) objectives, being highly rated across multiple ESG rating platforms. Notwithstanding this, Vermilion has been affected by COVID-19 and has had to reassess its strategy on cash returns to shareholders. The board suspended the dividend, appointed Loren

Vermilion Energy - Dividend suspended to protect balance sheet

Vermilion Energy recently reported Q120 production of 97.2kboed and fund flows from operations of C$170m. Even though the company has not observed a direct impact on its operations from COVID-19, results were already affected by the pandemic effects on global energy demand and current low commodity prices. In March, the board reduced the monthly dividend by 50% to C$0.115/share and announced a C$80–100m reduction to the annual capital budget. Subsequently, Vermilion suspended the monthly dividen

Vermilion Energy - Macroeconomic headwinds dictate dividend cuts

Vermilion Energy has recently reported record annual production of 100.3kboed and fund flows from operations (FFO) of C$908m for FY19. Key drivers to increased production include a full-year contribution from the Spartan assets acquired in May 2018. However, following recent macroeconomic headwinds such as the impact of the coronavirus and the Russia/Saudi Arabia price war, Vermilion updated its capex guidance and production estimates for the year. These significantly affect results; hence manag

Vermilion Energy - 14% dividend yield and FY20 growth covered

Vermilion Energy’s geographically diverse portfolio spreads geopolitical and pricing risk across different economies. The company has grown both organically and inorganically through a series of new country entries, with a solid track record of hitting guidance targets. Additionally, management has delivered on environmental, social and corporate governance (ESG) objectives, being highly rated across multiple ESG rating platforms. Notwithstanding this, Vermilion has been affected by the current

Reducing estimates on lower capex post 2019

VET’s Q2 FFO and production came in slightly below consensus, primarily owing to weaker oil production in France caused by downtime at a nearby refinery, and timing of its Australian oil sales. Strong test rates were reported from VET’s first operated exploration wells in Germany (8.8 mmcf/d restricted) and Croatia (15.0 mmcf/d), while test results from 4x new wells in Hungary were mixed. VET has also expanded its European presence again, signing contracts for 50% WI stakes in 580k acres in Ukra

Vermilion Energy - Q219 FFO 4.8% below consensus

Vermilion has reported Q219 FFO (fund flows from operations) of C$222.7m, 4.8% below consensus of C$233.8m and 8.2% below our forecast of C$242.5m despite a 14% increase in FFO y-o-y. Key drivers of the miss versus our forecast include reduced production in France due to a refinery outage which had a post-tax FFO impact of C$11m and an inventory build in Australia which had an impact of C$8m. At 103.0kboed, production was 1.2% ahead of our forecast despite the outage in France, driven by new wel

Vermilion Energy - Dividend and growth comfortably covered

Vermilion Energy offers a geographically diverse production base, the ability to fund an 8.1% dividend yield and a forecast FY19 c C$530m capital programme, all achievable even at realised commodity prices c 3% below our base case (WTI US$56.1/bbl, Brent US$62.8/bbl). We adjust our FY19 and FY20 forecasts to reflect lower short-term commodity price expectations (based on the latest EIA forecasts of 12 March 2019). EIA’s FY19 WTI moves from US$64.9/bbl to US$56.1/bbl (-14%), driving down our fore

Vermilion Energy - Q418 FFO 6.7% ahead of consensus

Vermilion has reported Q418 FFO of C$222.3m, 6.7% ahead of consensus C$208.3m and in line with our estimate of C$222.2m. At 101.6kboed, production was 2.7% ahead of our forecasts, with FFO/share 1.1% ahead at C$1.46/share. Guidance for 2019 production of 101–106kboed (with the mid-point implying 19% y-o-y growth) and the capex budget of C$530m remain unchanged. ROCE in 2018 was 9% compared to a five-year average of 4%. Our last published valuation was C$54.5/share, based on a blend of FY19 P/CF,

Vermilion Energy - 8.2% dividend yield secure at strip

Vermilion’s investor day highlighted its self-funded growth and income business model. Management’s commitment to providing shareholders a sustainable dividend is supported by a deep and diverse portfolio of assets resilient to a volatile commodity price environment. Project inventory supports a recycle ratio of over 2.5 times and the short-cycle nature of growth capex means spend can be rapidly diverted to projects that offer the highest returns or are curtailed. Our base case valuation falls t

Vermilion Energy - Q2 FFO in line; oil price upgrade drives valuation

Vermilion Energy (VET) reported Q2 fund flows from operations (FFO) of C$193m, in line with consensus estimates and a 23% increase q-o-q. The acquisition of Spartan drove a 15% q-o-q increase in production to 80.6kboed, c 1% ahead of consensus, which includes volumes from Spartan after close of the C$1.4bn acquisition on 28 May 2018. We increase our expectations for FY18 FFO from C$887m to C$946m (+7%) and FY19 FFO from C$1,104m to C$1,208m (+9%), reflecting higher oil price expectations for H21

2Q18 results in line with expectations and 2018 capital program accelerated

Vermilion reported 2Q18 production of 80,625 boe/d and cash flow of C$193 mm, which was in line with expectations. The company closed the Spartan Energy acquisition in 2Q18.

Vermilion closes Spartan acquisition; a steal of a deal

Vermilion’s acquisition of Spartan Energy has closed, and as such, we are off research restriction. We view the acquisition favourably noting that Vermilion was able to add another strong asset that can generate free cash flow to its portfolio. The Spartan acquisition satisfies Vermilion’s production and dividend growth model. The Spartan acquisition is immediately accretive to Vermilion with cash flow per share growth of 4% in 2018e (seven months of the year) and 12% in 2019e. With the acquisit

Vermilion Energy - Spartan - a value-accretive transaction

On 16 April 2018 Vermilion announced the proposed acquisition of Spartan Energy, a south-east Saskatchewan producer with estimated 2018 production of c 23kboed (91% oil) for a consideration of C$1.4bn, funded through C$1.23bn in Vermilion shares and the assumption of c C$175m of debt. The deal was priced at a 5% premium to Spartan’s closing price and is recommended by its board. In this note we incorporate Spartan’s asset base into our Vermilion forecasts and valuation based on the planned 15 Ju

Predator Oil & Gas Holdings PLC - Initiation of Coverage - Buy Target Price 0.25 Pence

• Up to 200MMscfd gas to industry opportunity in Morocco • Replacing more expensive and CO2 emitting LPG • 295BCF (2C) in Guercif permit onshore Morocco • Multifold upside from yet undrilled prospective in permit • Competitive advantage from capital-light phased development approach • 3-month re-rating to 15p after flow-testing discovery well, and two appraisal wells in June/July 2023 • 12-month target of 25p with first gas of 1MMscfd in May/July 2024 ramping-up rapidly to 10MMscfd • Further ups

Fully funded for range of activities - operational and key third party evaluations

Savannah Energy+ (SAVE, Suspended, Under Review) - Gas sales and purchase agreement signed with AMOCON

FLASH: Completion date extended (again)... but positive drilling results indicate resource upside

Andrada Mining: Lithium driving value after “numerous unsolicited approaches” to accelerate Uis development

Andrada Mining (“ATM”) has announced several unsolicited approaches from international entities to accelerate production from its lithium portfolio through a potential strategic partnership in its Uis project in Namibia. A global investment bank has been appointed to provide a structured assessment of potential partners based on financial and technical merits. After the expansion of the Phase 1 tin operation in 2022, Uis achieved record quarterly tin concentrate output for the three months to Fe

Initial Equity Trading Comments - 15 May 2023

Savannah Energy+ (SAVE, Suspended, Under Review) - COTCo update

Jubilee Metals (JLP) – Corporate – Jubilee concludes another value-added chrome deal

Jubilee today concludes yet another deal on the western limb of the Bushveld complex in South Africa – this time for a refurbished chrome facility processing 360kt chrome ore per year and producing 200kt/yr of chrome concentrate. This plant will be a carbon copy of other plants operated by Jubilee, making use of its expert chrome-ore processing technology and involves it retaining the PGM-enriched tailings (containing 10koz PGM) for processing at either Inyoni (full capture of revenues) or at i

Savannah Energy+ (SAVE, Suspended, Under Review) - FY22A results; readmission expected in Q3

WH Ireland: Jersey Oil & Gas (JOG) - License Extension & Assignment Approvals

The development is positive and meaningful. The support shown by the NSTA is reassuring, even if widely expected. We anticipate that crude oil prices will strengthen materially in 2H 2023 on strong inventory draws. Today's announcement positions Jersey Oil & Gas to participate fully in the positive momentum we see for the sector in 2H 2023. We reiterate our 684p fair value estimate for Jersey Oil & Gas.

Successful first test at CN-1

Cenkos: Diversified Energy Company Plc -- Director Purchases Underline Confidence

Recent share purchases by Diversified's Board and Management highlights the attractiveness of the Diversified value proposition, and should provide investors with confidence in the Company's long-term strategy. Despite significant growth in the Company's asset base in recent years and a stronger outlook for US natural gas, Diversified is now trading at its lowest price since the height of the COVID-19 pandemic in Q2/20. We believe the current dislocation in the Company's share price makes for an

Hybridan Research: Sector Review: Critical minerals for UK - mining and battery recycling: 09-05-2023

Virgin mining: Energy security and decarbonisation are driving the race in the sourcing of critical minerals from the natural world. This has contributed to the revival of exploration activities in the US, Europe and to a lesser degree the UK. For example, the global identified lithium resources increased from 40m tonnes in 2015 (the Paris Agreement year) to 97m tonnes in 2023, at a CAGR of 12%, according to the U.S. Geological Survey data. For example, there was no identified lithium resources

Hybridan Small Cap Feast - 06 Jun 23

6th June 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

Cenkos: Neometals Ltd -- Commercial progress crystallising value

Since its AIM IPO, Neometals has made substantial commercial progress with its battery recycling and vanadium recovery processes. Primobius, its battery recycling JV, is expected to record significant revenues from plant sales to third-parties this calendar year and commercial project SPVs in both battery recycling and vanadium recovery are approaching Final Investment Decision within the next 12-months. We believe these events will crystalise value for Neometals leading to a potentially signifi