Despite a seasonally quiet quarter for drilling operations, Whitecap impressed on the operational front with production of 70,611 boe/d 4% ahead of the consensus estimate while spending of ~$27 mm came in 30% lower than the “street” at $38.6 mm. With AFFO of $176 mm or $0.42/sh overlaying analyst estimates, the company delivered $114 mm of FCF in the period through an all-in cash use to cash flow ratio of 56%. Activity levels are slated to pick up significantly with 66% (~$300 mm) of its 2019e c
Companies: Whitecap Resources Inc.
Production of 75,529 boe/d and cash flow of $206.8 mm or $0.49/sh were both marginally ahead of expectations by 1%-2%. Whitecap’s performance was generated from less E&D spending than expected at $115 mm (GMP FE - $146 mm) which led to FCF generation of ~$58 mm in the period, bringing its D/CF ratio down to 1.6x. NCIB activity continued in 3Q18 with 1.0 mm shares purchased at an average price of $8.17/sh, bringing its total to ~3.0 mm shares ytd. We believe the NCIB continues to be one of the ke
The stocks on the GMP FirstEnergy Best Ideas List represent our highest conviction BUY recommendations with an expected return of 20% or more over the next 12 months. The investment thesis for each name on the list is laid out in this report.
Companies: CNQ AAV ATU PXX KEL RRX SPE WCP PXT SES PPL
In the latest corporate presentation, Management has updated its preliminary 2017e outlook where anticipated capital spending has increased from $205 mm to $300 mm. Average annual volume guidance under this accelerated view increases by 6% to 57,000 boe/d. This move continues to be funded well inside of organic cash flow generation with a proforma cash use to cash flow ratio of 83% (82% under the forward strip) while the balance sheet remains solid at 1.5x D/CF (2017e trailing). We are reaffir
Whitecap’s production topped FirstEnergy and Management guidance by 5%, and ideally spawn from capital spending that was 25% lower than anticipated. Commensurate cash flow was also 8% ahead of expectations with the help of production outperformance (particularly on the liquids front). While exit 2016e production guidance of 51,000 boe/d has been maintained, solid current volumes proforma the Husky asset deal and an active drilling campaign in 2H16e mean the Company appears on track to outperform
Some Recovery on Segmented Cash Flow Generation Over Q1 Though Still Down 56% Y/Y. In aggregate, the Intermediate, Mid, and Small Cap groups are expected to generate 2Q16e cash flow of $1,281 mm, $183 mm, and $53 mm, or $1.517 billion in total, that while depressed relative to the same period last year (~$2.647 billion combined), is up 17% sequentially from the prior quarter, largely on the strength of crude oil price recovery in the period. Severely weak natural gas pricing picture markedly rev
Companies: AAV ARX BTE BNP CPG ERF POU PEY PGF PWT PSK VII TOU VET WCP BNE CJ CR DEE JOY KEL LTS NVA PPY PNE RRX RMP SRX SGY TET ATU CKE GXE IKM LXE MQL PRQ SPE SKX TVE TVETF YO
WHITECAP RESOURCES INC (WCP CN)
Whitecap’s 1Q16 production of 43,000 boe/d was inline with our forecast and Company projections. Cash flow generation of $67.9 mm or $0.22 per share marginally outpaced FirstEnergy and consensus forecasts that were both $0.21 per share. Volumes and cash flow markers were achieved on spending that was 9% lower than anticipated. The Company continued its cost cutting initiatives with production expenses now ducking below the $10.00/boe level, which leaves it in the running for lowest cost operator
With this publication we briefly summarize our projections for 1Q16e quarterly results for the Junior E&P (Intermediate, Mid & Small Cap) segments of our coverage universe
Companies: AAV ARX BTE BNP CPG ERF POU PEY PGF PSK VII TOU VET WCP BNE CJ CR DEE JOY KEL LTS LRE NVA PPY PNE RRX RMP SRX SGY TET ATU CKE GXE IKM LXE ROAOF MQL RE SPE SKX TVE TVETF YGR YO
Whitecap has increased its 2016e capital program to $148 mm (previously $70 mm) with the incremental spending coming in 2H16 and being funded by a 38% dividend reduction to $0.28 per share annually. The Company also offered a 2017e preliminary outlook that includes $150 mm of spending to achieve average production of 41,500 boe/d. While the net effect dividend cut and capex increase on 2016e total cash use to cash flow is negligible, the effect on 2017e valuation, sustainability and leverage cha
With this publication we highlight various metrics and statistics forthcoming from yearend reserve books for our Domestic E&P coverage universe (Integrateds, Large Cap, Oilsands, Intermediate, Mid Cap, and Small Cap). Similar charts for YE2014 reserves can be found in our Statistical Package dated April 7, 2015.
Companies: AAV ARX BTE BNP CPG ERF POU PEY PGF PWT VII TXP VET WCP BNE CJ KEL LTS LRE NVA PPY PNE RRX RMP SRX SGY TET ATU BXO CKE GXE IKM LXE MQL SKX TVE TVETF YGR YO
A Boundary Lake consolidating acquisition was finalized before the end of 2015, adding ~1,700 boe/d and 11.5 mmboe of 2P reserves. The $93.4 mm purchase price was funded through the recently announced, and successfully closed, $95 mm equity financing. 2016e guidance was revised higher to 38,800 boe/d on an unchanged capital program of $70 mm. Current production is well ahead of this at 44,000 boe/d. 4Q15 results reveal zero surprises with production, cash flow and spending all in line with both
Reserves grew 2%, 8%, and 7% per share on a PDP, 1P and 2P basis, respectively. While FD&A costs were largely attached to its acquisition of Beaumont Energy, organic F&D additions this year came in at an impressive $12.57/boe PDP or $6.97/boe 2P. Our updated CNAV analysis shows normalized y/y growth of 23%. Our RENAV methodology continues to support a compelling return profile well in excess of
current trading levels, particularly when evaluating the underpinning assets on a risk-adjusted basis
With this publication we highlight forecast revisions associated with our crude oil commodity price update. Concurrent within a dynamic time for E&Ps, some of which have already begun the process of 2016 capital budget downdrafts, revised estimates attempt to directionally capture a shift towards capital conservation, though severely weakened futures curves have influenced our thinking for the better part of 6 months anyway. We expect further capital investment reductions forthcoming from E&Ps i
Companies: AAV ARX BNP CPG ERF POU PEY SPE SGY TVE TOU VET GXE KEL NVA PPY BTE PGF PSK PWT VII WCP BNE CJ CR DEE JOY LTS LRE PNE RRX RMP SRX TET ATU BXO CKE IKM LXE ROAOF MQL RE SKX TVETF YGR YO
This publication serves to recap the chaotic changes that have happened since original 2016e budgets were disseminated, plus provide clarity on the names we believe will thrive, survive, or those that will be challenged to remain in this group for much longer.
Companies: ARX CJ CPG PEY WCP VET BNP BNE ERF SGY
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Given the stellar performance of PGM prices, it is no surprise that Sylvania have achieved another record quarter with EBITDA of $58.7m and cash balance increasing 52% to $102.1m. Annualising this past quarter, the stock trades on a ridiculously cheap EV/EBITDA of 1.5x. Production of 17.4koz was inline with expectations and guidance of 70koz for the year remains in place. We remain very comfortable on rhodium on a five-year view (see here) and expect the abnormal cashflows to continue (30% FY22
Companies: Sylvania Platinum Ltd.
Thor Mining (Thor) provides investors with exposure to a wide range of commodities in two safe jurisdictions (the USA and Australia). We see Thor's priority projects as its In-situ Recovery (ISR) projects in South Australia and its shovel-ready Molyhil tungsten project in Northern Territory. Short term, we expect news from exploration and drilling at its Ragged Range gold project in Western Australia and drilling in its uranium projects in Colorado – either of which could be transformational f
Companies: Thor Mining PLC
Planned maintenance downtime at Vametco offset a solid performance at Vanchem as Q1 2021 vanadium production fell by 22% and 29% versus Q1 and Q4 of 2020, to 688t. Vametco is showing better stability post restart, but mindful of ongoing workstreams to maintain this, and of ramp-up risks attached to the Vanchem refurbishment, Bushveld now expects full-year production to come in towards the lower end of its 4,100-4,350t guidance range. We still envisage overall improved output this year, which in
Companies: Bushveld Minerals Limited
Semper Fortis Esports* recently announced its intention to IPO onto the Access Segment of the Aquis Stock Exchange Growth Market. Semper is a multi-operational Esports organisation focusing on gaming technology solutions, brand enhancement and high growth team infrastructures. The company plans to raise £2.5m to develop their three core areas of establishing an esports team, forming partnerships with brands for sponsorship and B2B consultancy services. The Board are highly experienced in spor
Companies: ADME RTC SAV DFCH HUW TEG ANIC KOO MIRI SPSY
Following on from our previous report we wanted to explore the potential value of the Jade, Topaz and Pearl prospects in the event of success. We explore a potential three stage approach to the drilling of the three identified prospects within Block 29/11. Phase 1 involves success at Jade, which in the event of a commercial discovery would see our risked valuation of Jade increase from 9.7p to 41.2p. Phase 2 involves success at Topaz, which in the event of a commercial discovery would see our ri
Companies: Empyrean Energy PLC
Not much of note in Touchstone’s Q1 results, although the oil price recovery has spurred increased workover activity on its mature base oil business, stabilising production. Cash resources remain strong and Touchstone has significant remaining headroom on its credit facility, which alongside existing cash flows should cover this year’s work programme. Our risked-NAV and price target fall slightly, by 4% to 157p/sh, due primarily to lower net cash balances, but the impending Royston exploration w
Companies: Touchstone Exploration Inc
Oil posted a gain this week as expectations for growing economic activity in nations from the US to Europe fuelled optimism around stronger summer demand. Futures in New York advanced 2.1% this week in the first back-to-back weekly increase since early March. Fuel sales in the UK rose to the highest since the pandemic again, and in the US, refineries are running at their highest rate since the pandemic began as they gear up for the summer driving season.
Crude's advance this week comes amid s
Companies: FO 88E DEC EME GTC TRIN UOG
Canyon Resources (CAY AU) – Minim Martap bauxite project mineral resource upgrade (Altus Strategies is invested in Canyon Resources)
Marvel Gold (MVL AU) A$0.05, Mkt Cap A$27m – Chilalo Graphite Project spin out (Altus Strategies holds a JV agreement with Marvel Gold)
Metal Tiger (MTR LN) – Drilling Commenced at KML copper project
Serabi Gold* (SRB LN) – Drilling confirms lateral and depth extensions to mineralisation at Palito
Companies: ALS SRB MTR CAY MVL
• The 7D well has been put on production at 3,700 bbl/d during the first 10 days of production and has averaged 4,550 bbl/d during the past three days. The well took only 33 days to drill at a cost of US$8.6 mm (7% below the US$9.2 mm estimate).
• During the last three days, Bretana oil field production has averaged approximately 11,100 bbl/d. Two wells, representing 1,200 bbl/d, are currently shut in awaiting increased water injection pump enhancements, suggesting an overall well production ca
Companies: PetroTal Corp.
The UK market showed a continued recovery in the first quarter albeit the indices are still well short of their all-time peaks, unlike many of their international peers. The FTSE 100 has risen by 1,186 points (21.4%) since the end of October and the FTSE 250 by 4,304 points (25.0%). The comparable performance since the start of the year is less spectacular- the FTSE 100 has risen by 253 points (3.9%) and the FTSE 250 has risen by 1,070 points (5.0%). The factors behind the sustained rally are fa
Companies: AMYT ARBB BPC BAG BVC BEG BONH BLVN BRSD CML CWK CRPR EYE ECHO FDM FAR FA/ GPH GSF HUW INSE JDG KAPE KP2 MACF MPAC MNZS NESF NBI OTMP OBD PREM QFI RUA SCS SEN SOS SUR TON TOU TXP TGL TCN UEM VLS WYN
Jubilee has announced that Phase 1 of its Roan copper project in Zambia is complete and that Roan has delivered its first shipment of copper-bearing concentrate to the Sable Refinery for processing. Jubilee will deliver 240t of copper concentrate per month in this first phase, rising to 400t/month in Phase 2 expected in Q3 2021. At the same time, Jubilee has signed a contract with a third-party to also supply copper units which are expected to add a further 150t/month by the end of June. We i
Companies: Jubilee Metals Group PLC
AfriTin* (ATM LN) – £13m raised to expedite Phase 1 expansion of the Uis mine in Namibia
Greatland Gold (GGP LN) – Decline development underway at Havieron
Oriole Resources (ORR LN) – Iamgold drilling at Faré, Senegal
Companies: ATM GGP ORR
Q1 2021 results
Companies: Serinus Energy plc
By Caledonia's admission, it was a difficult quarter at its Blanket mine in Zimbabwe; a fall in ground, an exceptional rainy season and changes in the payment mechanism for gold, all impacted on the production, technical and financial outcomes in the quarter. Thankfully, these issues are now all resolved and the working capital position is now back to normal with increasing amounts of net cash. On the plus side, Caledonia rewarded its shareholders and raised its dividend to 12c per quarter (an
Companies: Caledonia Mining Corporation PLC
CAML’s Q1 2021 production rates of copper, zinc and lead were down slightly versus Q1 2020, but we believe output of all three metals remains on course to meet group guidance for 2021. The latter is in-line with production levels over recent years, which if achieved we believe would result in material earnings (and potentially dividend) growth this year given the rally in base metals prices over recent months relative to 2020 average levels. Our 2021 forecasts would put CAML on an EV/EBITDA mult
Companies: Central Asia Metals Plc