||COM SHS USD0.01 (DI)
||EPS - Basic
||Market Cap (m)
|Oil & Gas Producers
Real-Time news about Resaca (London Stock Exchange): 0 recent articles
|lunartik: Yes, is a bit strange - but then this is a bit of a strange share!
Anyway it looks like we have a new broker recommendation - "strong buy" with upgraded eps etc.
Year Ending Profit (£m) EPS P/E PEG EPS Grth. Div Yield
30-Jun-10 2.75 5.50p 8.3 0.5 +17% n/a 0.0%
30-Jun-11 4.20 6.10p 7.5 0.7 +11% n/a 0.0%
Year Ending Sales/Share Price/Sales per share
30-06-2010 n/a n/a
30-06-2011 n/a n/a
Trends & Recommendations
Current 1 week ago 1 month ago 3 months ago 6 months ago 1 year ago
30-06-2010 0 0 0 17 n/a n/a
31-12-2010 n/a n/a n/a n/a 35 n/a
30-06-2011 0 0 0 n/a n/a n/a
30-06-2010 5.50p 3.60p 3.60p 3.60p n/a n/a
31-12-2010 n/a n/a n/a n/a 1.21p n/a
30-06-2011 6.10p 5.50p 5.50p n/a n/a n/a
30-06-2010 n/a n/a n/a n/a n/a n/a
31-12-2010 n/a n/a n/a n/a n/a n/a
30-06-2011 n/a n/a n/a n/a n/a n/a
Strong Buy 1 0 0 1 1 0
Buy 0 0 0 0 0 0
Neutral 0 0 0 0 1 0
Sell 0 0 0 0 0 0
Strong Sell 0 0 0 0 0 0
No. of Brokers 1 0 0 1 2 0
Average Rec 10.00 n/a n/a 10.00 7.50 n/a|
|lunartik: Is anyone still here?
No comments for almost two months.
Despite the fall in the share price I'm still sitting here patiently waiting for the merger to take place.
Resaca is meant to have the cheapest assets of all the oilers on Aim and the merger should make them cheaper still!
I'm surprised there is not more bottom fishing as there should be much greater activity once the American listing is confirmed.
Any views, as these seem very cheap again.|
|davidhp: As I see it, here's the problems with RSOX.
a) "In January of 2008, Haas Petroleum Engineering Services valued Resaca's reserves. Utilizing NYMEX commodity price assumptions of $95.98 for oil and $7.48 for natural gas and discounting at 10%, Haas valued Resaca's "2P" reserves at $423 million"
Well, sadly for the industry oil is now south of $60 and I re-value the "2P" reserves at a 'rough'
(423 / 95.98) * 60.00 giving $264 million (given a similar percentage fall for gas as oil... which is fair)
This halves the share price ceiling IMHO from roughly 150p to 75p... we are at a 50%+ discount to that... roughly in line with other larger oilers at the moment (2009July14).
b) Nobody trusts the americans right now to be fair, honest nor law abiding and to be honest many have the appearance of crooks in the eyes of international investors... burnt fingers promote long memories!
c) If I hadn't seen them in IC, I wouldn't have heard of them. The phrase "boiler room" springs to mind but who can be sure with american small-caps?
d) RSOX financing involves the american finance giant, CIT, which is in the last throes of some kind of painful death at the moment... and while a bailout might be on the cards by the panic-striken us government looking to secure the 300,000 jobs sheltering beneath the teetering CIT, nothing can be certain in this climate. The Chinese won't be pleased and since they own the usa right now, via a t*sticle in iron fist combo (50points), further bailouts may not be issued.
e) If institutions are dumping RSOX, given they 'appear' at least 50% undervalued, you gotta ask yourself, "What DON'T we know that they 'know' or suspect?"
f) ALL their production is in the usa and the usa is, AS THE CHAIRMAN ALLUDES IN HIS REPORT, appearing to teeter on the brink of high oil industry taxation, fiscal collapse and market destruction. If they had overseas production, Asian or European, I'd be tempted to be perfectly honest.
IMHonestO I am keeping them in my list but not putting my hard earned their way until at least the CIT issue looks like its near a solution. But that's just me...
Resaca is probably not a stock for those seeking the thrill of high impact exploration. But as Lendrum points out the Resaca does not have to find the cash for exploration and development either. He believes that by incrementally increasing output and perhaps making acquisitions, Resaca could become a something substantial. He makes a case that on the basis of proven reserves but not proven, developed and producing reserves, the shares are worth around 120p, a long way north of the current share price. The Broker Seymour Pierce concurs with this saying the company is undervalued on the basis of a modest enterprise value for the proven reserves.|
|half man half codpiece: What does Seymour Pierce make of all this. It says: " Whilst the well flagged deferral of the next phase of the work programme has resulted in us downgrading our near term earnings forecasts, given the long term characteristics of the reserve base and lower cost estimates, it has not changed our asset value estimate which remains at 120 pence per share. In any event, at this very early stage in the development programme, Resaca is not an earning play; it is a reserves and asset value story. Seymour Pierce arrived at this valuation assuming an oil price of US$ 55 a barrel this year and US$65 thereafter. These do not seem unreasonable assumptions just now. The share price is currently a long way south of this asset valuation.|
|half man half codpiece: April 14, 2009
Broker Seymour Pierce Is Upbeat About Resaca Exploitation's Reserves and Value Despite The Company's Deferral of the Next Phase In Its Work Programme
As its name suggests Houston-based Resaca Exploitation, which listed on London's AIM in July 2008 is at pains to explain its emphasis is on exploiting known hydrocarbon deposits in a low risk way rather than going for high cost exploration.
Following a well flagged deferral of the next phase of the work programme (in anticipation of materially lower costs and higher commodity prices) Resaca has produced some interim results and broker Seymour Pierce has come up with a re-evaluation of the group.
Resaca has interests in eight fields in the Permian Basin of West Texas and New Mexico. This is one of the largest and most prolific oil and gas producing basins in the US, having produced over 24 billion barrels of oil since its discovery in 1921. Resaca's fields are mature and shallow the average depth being less than 4,000 feet. They can produce from multiple formations and have long production histories albeit established decline curves.
The eight fields have had 326 production wells and 90 injection wells as well as some shut in wells. Unlike many of its AIM peers, the majority (55 per cent or 17.3 million barrels of liquids) of Resaca's reserves are proven rather than theoretical. The latest reserves estimate state 2P reserves (proven and probable) are 28.4 million barrels of oil and 19.1 billion cubic feet of natural gas giving 31.6 million barrels in oil equivalent terms. Three P reserves (proven, probable and possible) are put at 33.9 million barrels of oil and 23.3 bcf of gas.
Resaca is slightly different to many companies in that it uses primary, secondary and tertiary techniques such as drilling infill wells, opening behind pipe zones, recompleting wells, reactivating and optimising waterfloods, improving field infrastructure and CO2 flooding, to unlock additional barrels from production and grow cash flows. These techniques could increase the recovery factor from 14 per cent to nearer 25 to 30 per cent over time; or by around 1000 barrels of oil equivalent per day a year to bring about production of 6,700 boepd by 2014.
This is not the kind of business that offers a white knuckle ride associated with high risk exploration, but suits those interested in low risk incremental increases in production and reserves and, if prices are right, cash flow. A dividend by 2010 has been talked about. Resaca started the first phase of capital investment in 2006. At the Cooper Jal Unit, Resaca's largest property, the company completed five new wells cleaned out three water injection wells and completed four behind pipe workovers.
The group claims this first phase has been successful in that the company is now producing 720 boepd. Moreover in the recent interim results, Resaca also said that water injection is in excess of 15,000 barrels a day. Chairman J P Bryan says this is not quite enough; the rate needs to be 18,000 barrels a day to boost production. However, the company says it expects to reach this rate in fields that have the best chance for immediate response.
In terms of cash flow hedging has helped soften the worst excess of the 2008 collapse in commodity prices with about 65 per cent of the company's 2009 production hedged, giving the group a floor prices of US$58 per barrel and a cap of US$66.30 a barrel with a gas floor of US$ 6.30 per million BTU and a cap of US$11.50 per million BTU.
However, in the face of lower oil and gas prices, although work continues on optimising the water flood facilities at Cooper Jal, Resaca has temporarily suspended new drilling activity across its properties and has also implemented a general cost reduction programme. In addition, the company is in negotiations with lenders to refinance its current senior credit facility, of which it has US$ 32 million available to fund development work.
The way Chief Executive Jay Lendrum puts it is "Prudence dictates that we maintain existing production until we can receive a more acceptable price for these reserves". He adds that the company remains enthusiastic about its current asset base.
What does Seymour Pierce make of all this. It says: " Whilst the well flagged deferral of the next phase of the work programme has resulted in us downgrading our near term earnings forecasts, given the long term characteristics of the reserve base and lower cost estimates, it has not changed our asset value estimate which remains at 120 pence per share. In any event, at this very early stage in the development programme, Resaca is not an earning play; it is a reserves and asset value story. Seymour Pierce arrived at this valuation assuming an oil price of US$ 55 a barrel this year and US$65 thereafter. These do not seem unreasonable assumptions just now. The share price is currently a long way south of this asset valuation.|
|half man half codpiece: Author: GHH Number: 58996 of 59202
Subject: Re: Resaca yet to bounce Date: 14/5/09 15:56
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
I posted re Resaca last week. The gist:
Listed 17th July 2008, raising £42m at 130p. Can buy today at circa 22p.
From above Seymour Pierce Note:
It has not changed our asset value estimate which remains at 120 pence per share assuming an oil price of $55 this year and a flat $65 per barrel thereafter.
However, applying valuation metrics derived from industry M&A activity would value Resaca at anywhere between 150 and 200 pence per share.
Market cap is £21m and net borrowings of £14m, hence EV £35m.
Resaca has independently assessed proved reserves of 17.3 million barrels and proved plus probable reserves of 31.6 million barrels, in oil equivalent terms. In January of 2008, Haas Petroleum Engineering Services valued Resaca's reserves. Utilizing NYMEX commodity price assumptions of $95.98 for oil and $7.48 for natural gas and discounting at 10%, Haas valued Resaca's "2P" reserves at $423 million.
The concern was
Resaca refinancing its current senior credit facility but had headroom of $32.0 million available at YE. Not sure whether re-financing to increase facility for acquisitions or breached covenants because of falling commodity prices . Will find out.
Since then I have clarified that RSOX under no financial pressure to re-negotiate Senior Debt - they are only doing so in order to achieve better terms since they used the bulk of the £40m to reduce the Senior Debt Facility. They still have circa $30m headroom.
They said at recent Presentation that in merger talks. It appears that they intend to build Resaca into a significant oil company and then sell, presumanly when market picks up.
Bad news is shares illiquid but if RSOX packaging itself for a takeover we have an exit.
There has been a large US seller holding share price down but possibly nearly cleared - this is what I'm being told but......
I'm also told recent Presentation (on web site www.resacaexploitation.com) was bullish and well received.
Resaca effectively run by the guys behind Torch. Looks decent track record with plenty of corporate exits.
Directors close to retirement - 12% shareholder/Chairman 69.
Business model low risk, very large discount to reserves, plenty of financial headroom and cash positive (800 bopd with 65% hedged at $62) and a probable exit strategy via multi bagging takeout if Seymour Pierce NAV's even half correct.
Resaca share price data is direct from the London Stock Exchange