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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Diversified Energy Company Plc | DEC | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 14.00 | 1.12% | 1,267.00 | 08:17:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 1,256.00 | 1,256.00 | 1,270.00 | 1,253.00 |
| Industry Sector |
|---|
| OIL & GAS PRODUCERS |
| Announcement Date | Type | Currency | Dividend Amount | Ex Date | Record Date | Payment Date |
|---|---|---|---|---|---|---|
| 12/11/2024 | Interim | USD | 0.29 | 27/02/2025 | 28/02/2025 | 31/03/2025 |
| 15/08/2024 | Interim | USD | 0.29 | 28/11/2024 | 29/11/2024 | 27/12/2024 |
| 09/05/2024 | Interim | USD | 0.29 | 29/08/2024 | 30/08/2024 | 27/09/2024 |
| 19/03/2024 | Final | USD | 0.29 | 23/05/2024 | 24/05/2024 | 28/06/2024 |
| 15/11/2023 | Interim | USD | 0.875 | 29/02/2024 | 01/03/2024 | 28/03/2024 |
| 01/09/2023 | Interim | USD | 0.04375 | 30/11/2023 | 01/12/2023 | 29/12/2023 |
| 09/05/2023 | Interim | USD | 0.04375 | 31/08/2023 | 01/09/2023 | 29/09/2023 |
| 21/03/2023 | Final | USD | 0.04375 | 25/05/2023 | 26/05/2023 | 30/06/2023 |
| 14/11/2022 | Interim | USD | 0.04375 | 02/03/2023 | 03/03/2023 | 28/03/2023 |
| 08/08/2022 | Interim | USD | 0.0425 | 24/11/2022 | 25/11/2022 | 28/12/2022 |
| 16/05/2022 | Interim | USD | 0.0425 | 01/09/2022 | 02/09/2022 | 26/09/2022 |
| 22/03/2022 | Final | USD | 0.0425 | 26/05/2022 | 27/05/2022 | 30/06/2022 |
| 28/10/2021 | Interim | USD | 0.0425 | 03/03/2022 | 04/03/2022 | 28/03/2022 |
| 05/08/2021 | Interim | USD | 0.04 | 25/11/2021 | 26/11/2021 | 17/12/2021 |
| 30/04/2021 | Interim | USD | 0.04 | 02/09/2021 | 03/09/2021 | 24/09/2021 |
| 08/03/2021 | Final | GBP | 0.0281 | 27/05/2021 | 28/05/2021 | 24/06/2021 |
| 29/10/2020 | Interim | USD | 0.04 | 04/03/2021 | 05/03/2021 | 26/03/2021 |
| 10/08/2020 | Interim | USD | 0.0375 | 26/11/2020 | 27/11/2020 | 18/12/2020 |
| 04/05/2020 | Interim | USD | 0.035 | 03/09/2020 | 04/09/2020 | 25/09/2020 |
| 09/03/2020 | Final | USD | 0.035 | 28/05/2020 | 29/05/2020 | 26/06/2020 |
| 10/12/2019 | Interim | USD | 0.035 | 05/03/2020 | 06/03/2020 | 27/03/2020 |
| 08/08/2019 | Interim | USD | 0.035 | 28/11/2019 | 29/11/2019 | 20/12/2019 |
| Top Posts |
|---|
Posted at 20/11/2024 18:36 by putinaire Fitch Places Diversified ABS Phase II LLC's Notes on Rating Watch NegativeFri 01 Nov, 2024 - 16:47 ET Fitch Ratings - New York - 01 Nov 2024: Fitch Ratings has placed Diversified ABS Phase II LLC's class A notes on Rating Watch Negative. Transaction Summary Diversified Energy Company (DEC), through its wholly owned subsidiary Diversified Production LLC, conveyed a 29.4% non-operating working interest in approximately 50,000 wellbores in the Appalachian basin to Diversified ABS Phase II LLC. The notes are backed by oil and gas proved, developed and producing (PDP) assets with a current IE full-life PV-10 value of approximately $200.5 million (transaction life PV-10 value of $165.3 million). The current valuation is based on strip pricing for oil and gas as of Oct. 17, 2024. Fitch's rating addresses the likelihood of timely payment of interest and ultimate payment of principal by the legal final maturity in 2037 for the notes. The Negative Watch reflects Fitch's forward-looking analysis, which considers certain expenses, current projected hedge structure, and structural aspects of the transaction. The issuer has been subsidizing a portion of marketing and gathering costs to support ongoing cashflows (DEC owns a substantial portion of midstream assets servicing the ABS wells). Fitch's forward-looking analysis does not credit this in its scenarios. Fully loaded expense and negative movements in gas differentials affect the transaction's potential cash flows. The primary factor negatively impacting future transaction cash flows is the low strike price on the current hedges. The issuer is exploring a restructuring of the hedge profile to significantly strengthen the future cashflows supporting the transaction. Fitch will monitor the execution of this strategy and other factors over the next three to six months to determine if further action is necessary. KEY RATING DRIVERS PDP Production In Line with GC1 (Positive): Fitch considers PDP assets to be very stable and views PDP production as consistent with a 'GC1' and rating levels up to the 'A' category. In this transaction, the underlying collateral is a slice of a diversified portfolio of approximately 50,000 wells, with the majority of production coming from about 20% of the wells. The wells have a weighted average life/seasoning of over 17 years. The decline profile has historically been stable, and Fitch expects it to remain so over the transaction's life. Limited Future Generation Risk (Positive): Future cash flows are expected to continue with limited disruption in the event of an operator bankruptcy. Therefore, Fitch has not directly linked the transaction rating to the credit quality of DEC. However, exposure to operational risks in PDP transactions limits the notes' rating to the 'A' category. Base Case and Stressed Case Production Levels (Neutral): Fitch's base case production levels are derived from third-party independent engineer (IE) reports, which determine reserve estimates and production levels based on the existing PDP reserves and historical performance. Fitch's base case aligns with IE projections due to the historical stability of production, the diversified portfolio, and the average life of the wells. Fitch applied various stresses to the IE production levels, including a two-year shock off Fitch's base case with a 10% reduction during the stress period. Additionally, Fitch ran a flat breakeven production stress of 8.5% in its base case to simulate potential future volatility and overall volumetric risk. Fitch also modeled a prolonged stress scenario with a 1.5% production stress for the transaction's remaining life. Majority of Price Risk Hedged (Positive): The transaction mitigates most price risk through hedges covering approximately 80% of gas production until February 2032 and 85% of oil production until March 2026. Additionally, basis risk for natural gas is hedged for 75%-90% of projected gas production until December 2026. However, the current hedge book's strike prices are lower than current strip pricing, limiting the transaction's future cash flows. Furthermore, the basis differential environment has worsened since closing, reducing revenues per unit of production. Fitch stresses the unhedged portion of the portfolio per its "Future Flow Securitization Criteria." In Fitch's base case, Fitch uses the latest Fitch Corporate Price Deck, applying $64 for WTI and $3.00 for Henry Hub after half-cycle. For a two-year shock scenario, Fitch uses $35 for WTI and $1.80 for Henry Hub during the stress period. In a prolonged stress scenario, Fitch applies $55 for WTI and $2.67 for Henry Hub. Hedges mitigate some commodity price risk, but unhedged exposure and the rolling nature of hedges limit the transaction to the 'BBB' category. Net Cash Flows Subject to Operating Expenses (Negative): The securitized revenue stream relies on net cash flows (NCFs) from each well, which depend on production levels and wellhead prices minus all expenses, including gathering and transportation (G&T). While individual wells may face some cost volatility, overall portfolio costs remain stable. DEC currently partially subsidizes G&T expenses, as permitted under the documentation. Fitch does not credit this subsidy in future expense projections, and is using approximate market rates instead. Fitch stressed market rate expenses by 3% in Fitch's base case, and 10% during the stress period in the two-year shock scenario. Fitch also stressed expenses 4% in a prolonged stress scenario. Leverage and Coverage Levels (Negative): Fitch uses the loan life coverage ratio (LLCR) to to assess coverage adequacy in different scenarios. Based on IE projections, the LLCR for class A notes is 1.96x. In Fitch's base case, the LLCR is 1.41x, and in the two-year shock scenario it is 1.18x. If considering the current subsidy supporting G&T expenses, the LLCR would be 2.79x, 2.27x and 2.03x in these scenarios, respectively. DSCR levels are expected to breach triggers in both the IE and Fitch base cases as principal amortizations step up over the transaction's remaining life. This step-up in amortization occurred at the five-year anniversary of the notes and was due to an assumption in the initial projections that uneconomic wells would be shut-in after the initial five years. DEC has continued to keep in operation the overwhelming majority of its wells, which results in higher fixed costs compared to initial projections. While the issuer has been reducing these higher projected expenses by covering G&T, Fitch does not include this reduction in its projected cashflows. More impactful to projected cashflows is the remaining hedge book, which has prices significantly below strip prices. Differentials have also become more negative within this region since the transaction's close. Fitch's base case full-life LTV for the class A notes is 78.2% (91.9% using transaction life PV-10). Financial Structure (Positive): The transaction benefits from significant structural protections like backward-looking cash sweep mechanisms based on DSCR and production tracking levels. An LTV trigger offers a forward-looking view of overall leverage relative to expected value. Cash-sweep triggers allow accelerated de-levering if performance falls short of IE base case expectations, though they are not currently active due to subsidized midstream expenses. Additionally, the transaction benefits from a six-month liquidity reserve account to cover monthly interest payments and senior expenses. Counterparty Risks (Neutral): Fitch analyzed the transaction's counterparty risk per its "Structured Finance and Covered Bonds Counterparty Rating Criteria." Eligibility thresholds are outlined as investment grade, aligning with Fitch's criteria for the 'BBB' category level. Fitch assessed payment disruption and co-mingling risk, finding the six-month reserve account sufficient to mitigate these risks. The swap counterparty and ISDA agreement were reviewed, and Fitch will evaluate if the downgrade of a swap counterparty below the transaction rating impacts the notes' rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transaction's credit strength depends on asset production levels and expense fluctuations, which can reduce the securitized net cash flow. Significant decreases in production compared to projections will negatively impact the rating. Increases in expenses or the removal of DEC's current subsidy for G&T may affect margins and the rating. While the transaction hedges the majority of natural gas price risk and natural gas basis price risk for portions of time during the life of the transaction, significant changes in basis or long-term commodity price reductions could have a negative impact. Revenue constraints given the current hedge book, combined with negative production or expense changes, may also affect the transaction's ability to absorb stress in a downside scenario. Additionally, the transaction cannot be de-linked from the hedge counterparties; thus, a downgrade of a hedge counterparty below the respective threshold of the note's rating will affect the transaction rating. Fitch ran multiple stress scenarios changing different variables, with a majority resulting in at least one category downgrade without amending the current hedge book. If the company can execute on its expected hedge strategy, these scenarios would result in a reaffirmation of the rating. Any changes in these variables will be analyzed in a rating committee to assess the possible impact on the transaction rating. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade The class A notes are capped in line with the criteria and further limited to the 'BBB' category, given partial exposure to commodity prices. The transaction will continue to be capped unless there are changes to the current criteria. |
Posted at 20/11/2024 09:08 by someuwin Tennyson...Diversified Energy (BUY) COAL MINE METHANE TRUMPS EARNINGS "Diversified Energy (DEC LN) reported Q3 numbers last week, which were in-line with expectations and showed continued progress on its core business objectives. Adjusting our FY24-25 estimates for the results & latest gas prices delivers some minor tweaks (see Figure 1, below), but the general earnings picture is much as before. Our investment thesis on the stock continues to be underpinned by DEC’s stable FCF base which fuels ~US$1bn of organic debt reduction over the next five years, after paying dividends. On top of this, we see scope to unlock hidden value across the portfolio through undeveloped land sales and other initiatives, such as environmental credits linked to coal mine methane (CMM). Additionally, heighted M&A across the US oil & gas patch should see a steady stream of PDP assets hit the market, as sellers look to shed non-core acreage and reset their finances, leaving no doubt over DEC’s growth runway. We reiterate our BUY recommendation and £20/shr target price..." |
Posted at 13/11/2024 11:49 by putinaire Putinaire - 12 Nov 2024 - 07:27:46 - 3796 of 3875 DEC - LSE & NYSE - DECGas cant break this due to the balance of other commodity prices. It just has volatility to it ....... Gas hadnt a hope there dudes Now, DEC has played it nicely, still adjusting last earnings - It wont be lasting for much longer though |
Posted at 12/11/2024 07:02 by skinny Delivering Reliable Results• Recorded average 3Q24 production of 829 MMcfepd (138 Mboepd) ◦ September 2024 exit rate of 851 MMcfepd (142 Mboepd) • Operating Cash Flow of $102 million, and Net loss of $1 million inclusive of non-cash unsettled derivative adjustments, and non-cash depreciation, depletion and amortization • Achieved 3Q24 Adjusted EBITDA(a) of $115 million and Free Cash Flow(b) of $47 million • Realized 49% 3Q24 Adjusted EBITDA Margin(a) and TTM Free Cash Flow Yield(b) of 32% ◦ 3Q24 Total Revenue, Inclusive of Settled Hedges per Unit(c) of $3.23/Mcfe ($19.38/Boe) ◦ 3Q24 Adjusted Operating Cost per Unit(d) of $1.71/Mcfe ($10.23/Boe) • Reaffirmed credit facility borrowing base at $385 million with $102 million of undrawn capacity and unrestricted cash Revenue Growth Initiatives • Announced fixed-price contract for gas delivery to a major Gulf Coast LNG export facility • Generated ~ $23 million year-to-date in cash flow through divestiture of undeveloped leasehold • Expansion into adjacent market of Coal Mine Methane ("CMM") capture and environmental credit sales generating $8 to $10 million of EBITDA in 2024 Executing Strategic Objectives • Retired $154 million debt principal through amortizing debt payments, year-to-date • Declared 3Q24 dividend of $0.29 cents per share • Repurchased ~1.4 million shares in 2024, representing ~$20 million of share buybacks(e) • Completed previously announced acquisitions of Crescent Pass Energy and East Texas assets ◦ Combined with Oaktree Working Interest Acquisition, offsets ~2 years of declines(f) Next LVL Milestones • The Company has retired a total of 165 operated wells, year-to-date and is on track to meet or exceed Diversified's stated goal of retiring 200 wells within its Appalachian footprint in 2024 ◦ Next LVL Energy completed 233 well retirements through September 2024, including 68 wells associated with orphan wells and third-party operators |
Posted at 16/10/2024 05:45 by leoneobull Thanks Asp1 on LSE. $500M (revenue net of costs) - $120M (interest) - $150M (debt reduction) - $55M (dividend) = $175MWhat is missing from above is the $170M to purchase new assets to cover the decline rate, meaning daily production stays flat (no reduction that you mention). Since IPO DEC has only issued equity or taken on additional debt for the purpose of acqisitions which for me is perfectly fine especially as they are all accretive (I used a 25%, 25%, 50% ration in my example of cash, equity, debt). Rrb believes this must be paid fully in cash, that is the fundamental difference.So if we continue the maths $175 - 25% (cash part of purchase) = $130M buffer (26% of the $500M net revenue - very healthy).Now in 10 years time once debt is repaid then $270M ($150M + $120M) would drop off completely. This creates the headroom to start meaningful ARO and surprise , surprise, DEC have current contracts with states for the next 10-15 years that commits them to very low volumes.So they are protected for the next 10-15 years. Not to avoid ARO, but to perform the ARO in an economically efficient way without recourse to the taxpayer. I believe many states fully understand this. However in my view the green lobby want all fossil fuels to be shut off immediately which makes no economic sense and they skew reporting in this way. I believe DEC invited bloomberg back to re do their piece after they put in place their detection sysetms etc but I have never seen a follow-up article.Finally I would just like to note that crescent point was happy to take DEC equity as part of the recent acuisition. Given they are experienced players in this industry why would they accept equity if there are doubts re DEC short term? It makes no sense.DEC can cover its dividend, debt, ARO obligations etc. and has a sustainable model in my view. I have not seen any logic to change my view as of now |
Posted at 14/10/2024 11:46 by leoneobull Thanks AC1 on LSEI do not agree with the sentiment that DEC have been "found out" and that ARO's or debt is a problem. Let me try to explain why.The average life of DEC's wells is 50 years (as per latest ARO presentation). From mid year results we know daily production at end of June was 855 MMcfepd. Assuming ~70K wells it means the average well produces ~12 Mcf per day (855/70). At the current $3+ hedge price this translates to an average ~$13K revenue per well (12x3x360 days a year).The DEC business model is a density based business model. This means that a DEC well tender looks after several wells in a close geographic area to minimize travel time and maximize time spent attending to wells.From the annual results DEC has ~1600 employee with two thirds (~1100) out in the field. Meaning each well tender takes care of ~64 wells (70k/1100). This means a single DEC tender on average manages ~$830K revenue (13Kx64 wells).Lets look at the big cost elements. The vast majority of debt is amortizing over the next 10 years, meaning $150M pa of capital needs to be repaid (~$1,5B/10 years) plus $120M in interest (~$1,5B @8% average interest), for a total of $270M per annum. Which equates to $3850 per well (270M/70k) or ~250K per well tender ($3850x64)Lets assume an average salary for a well tender of $75K pa , then for the next 10 years net revenue after debt & salary per tender is ~500K ($830-$75-$250).Assu |
Posted at 27/9/2024 08:12 by johnhemming The big issue with DEC is that a hyperbolic decline is different to an exponential decline. With a hyperbolic decline the reduction in production as a proportion of production reduces each year until it stabilises at an exponential decline of perhaps 4-5%. Hence there is a very big tail of production.So if people forecast the decline based upon the decline so far they get the decline rate too high. |
Posted at 06/9/2024 16:01 by shawzie First attempt using Advfn Ai.How does Diversified Energy's current valuation and trading discount to peers represent an attractive investment opportunity for investors? Based on the data provided, here is an analysis of Diversified Energy's current valuation and its trading discount relative to peers: Company Overview and Financial Metrics Diversified Energy Company PLC (DEC) Market Cap: $521.16M Total Enterprise Value (TEV): $2,299.62M Total Revenues: $699.47M P/E Ratio: 3.68 P/B Ratio: 0.96 EV/Sales: 3.29 EV/EBITDA: 4.56 Forward EV/Sales: 2.26 Forward EV/EBITDA: 4.97 Performance and Guidance (H1 2024 Earnings Call) Free Cash Flow Generation: $121 million (38% free cash flow yield) Production: Consistent with 0% decline over the last 3 fiscal quarters Capital Returns: Over $850 million paid to shareholders since IPO Cash Margins: 50% average over the past 7 years Free Cash Flow Conversion Rate: 55% of EBITDA Guidance: Higher production expected by end of 2024, focus on debt reduction, shareholder returns, and accretive acquisitions. Valuation Metrics Forward P/E: 4.24 Price to Sales (EV/Sales): 3.29 (most recent data) Industry Competitors Comparison Peers in the Oil, Gas, and Consumable Fuels Industry: Clean Energy Fuels Corp. (CLNE) Market Cap: $690.39M Forward P/E: -132.62 Forward EV/Sales: 1.95 Operating Margin: -10.6% VAALCO Energy, Inc. (EGY) Market Cap: $675.37M Forward P/E: 11.03 Forward EV/Sales: 1.22 Operating Margin: 35.24% enCore Energy Corp. (EU) Market Cap: $659.03M Forward P/E: 71.75 Forward EV/Sales: 7.69 Operating Margin: -105.11% Centrus Energy Corp. (LEU) Market Cap: $644.69M Forward P/E: 13.25 Forward EV/Sales: 1.68 Operating Margin: 21.67% Riley Exploration Permian, Inc. (REPX) Market Cap: $614.9M Forward P/E: 3.95 Forward EV/Sales: 2.11 Operating Margin: 39.71% Analysis Valuation Discount: Diversified Energy's P/E ratio of 3.68 and forward P/E of 4.24 are significantly lower than many of its peers, indicating it is trading at a discount. Profitability: The company has strong profitability metrics with an operating margin of 30.51% and a net profit margin of 20.46%, which are competitive within the industry. Cash Flow: Strong free cash flow generation and high free cash flow conversion rate (55% of EBITDA) highlight the company's ability to generate cash and return value to shareholders. Growth Prospects: Despite a negative EPS growth rate over the past few years, the company expects higher production and continued focus on shareholder returns and debt reduction. Conclusion Diversified Energy's current valuation metrics, such as its low P/E ratio and strong profitability, suggest that it is trading at a discount compared to its peers. The company's consistent production, strong free cash flow generation, and strategic focus on debt reduction and shareholder returns further enhance its attractiveness. However, investors should consider the overall market conditions and the company's future performance before making any investment decisions. Diversified Energy Company PLC Website Diversified Energy Company PLC (DEC) EV/Sales 06 Sep, 2024 EV/Sales 3.29 3.29 2018 2019 2020 2021 2022 2023 2024 2.00 4.00 6.00 8.00 10.00 12.00 03 Feb, 2017 - 06 Sep, 2024 (7.59 years) EV/Sales Total Chg: -52% (CAGR: -9.15%) Label Sep '21 Dec '21 Mar '22 Jun '22 Sep '22 Dec '22 Mar '23 Jun '23 Sep '23 Dec '23 Mar '24 Jun '24 LTM EV/Sales 2.62 1.88 1.84 1.34 1.36 1.39 1.63 1.89 1.74 2.02 2.49 2.78 3.29 What are the potential risks associated with investing in Diversified Energy at its current valuation? Investing in any company, including Diversified Energy, comes with potential risks. Here are some key risks associated with investing in Diversified Energy at its current valuation: 1. Commodity Price Volatility Risk: Diversified Energy operates in the oil and gas industry, which is highly sensitive to fluctuations in commodity prices. A significant drop in oil or natural gas prices can adversely affect the company's revenue and profitability. Impact: Lower commodity prices can lead to reduced cash flow, making it challenging. |
Posted at 05/9/2024 14:29 by kaos3 - dec is an option on ng prices- situation regarding us ng is well put in latest goering and rosenzwang - dec is very well placed in the possible usa geopolitical internal situation /said it first/ - i did add bellow 8.5 today just above all time lows as predicted above ... in this range shorts are slowly closing ... as it is a sweet spot regarding seasonality and index situation. i even assume that on big boys grapevine dec stopped bb in order for the shorts to be closed and exited and dec being left alone. no wars is good. just let us do and you will be fine |
Posted at 02/9/2024 15:24 by stevensupertrader Not long ago, dividend yield was almost 30% and then Rusty and the Board decided to cut the juicy dividend by 67% then to reflect a sustainable dividend payout of 29 US cents for each quarter mentioned by Rusty - many investors were unhappy at that time ( just the beginning of this year . Now as share price keeps on falling , dividend yield will soon back to 15% and then 20% - currently at £8.90 , the yield is almost 10% 😃 |
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