Diversified Energy Share Discussion Threads

[leoneobull] 30/1/2024 07:26

Here is a handy calculator for the shorters to work out how much dividend they will have to fork out if still short by February 29th...https://www.dividendmax.com/united-kingdom/london-stock-exchange/oil-and-gas-producers/diversified-energy-company-plc/dividends

[grahamg8] 30/1/2024 07:21

Solid. Only slight surprise was that 384 wells were retired.

[leoneobull] 30/1/2024 07:20

Weren't the snowflake research people talking about EBITDA estimate of 450m based on quoting 1 analyst whereas in reality 540 to 545m?Estimated Adjusted EBITDA(b) of $540 to $545 million?     Adjusted Operating Cost per Unit of $1.69/Mcfe ($10.14/Boe)(c) down 3% versus FY22?     Adjusted EBITDA Margin(d) of 51%

[leoneobull] 30/1/2024 07:15

Looks great to me, especially the debt reduction and dividend maintained. Snowflake bro's may melt by 8am?

[seekthetech] 30/1/2024 07:13

That is a horrific update….

For shorters

[lord gnome] 30/1/2024 07:13

Ok, so what was all the fuss about? Reads like business as usual.

[skinny] 30/1/2024 07:01

Delivering Reliable Results

• 2023 average net daily production: 821 MMcfepd (136.8 Mboepd)

◦ 4Q 2023 average production of 777 MMcfepd (129.5 Mboepd)

◦ December 2023 exit rate production of 775 MMcfepd (129.2 Mboepd)

◦ Maintained peer-leading consolidated corporate production decline rate of ~10%(a)

◦ Marketed 100% of our produced natural gas with our internal marketing team, utilizing industry delivery, settlement, compliance, and confirmation standards while providing improved margins

• Estimated Adjusted EBITDA(b) of $540 to $545 million

◦ Adjusted Operating Cost per Unit of $1.69/Mcfe ($10.14/Boe)(c) down 3% versus FY22

◦ Adjusted EBITDA Margin(d) of 51%

• Free Cash Flow Yield of ~21%(e), including the impact of working capital changes

• Declared Q3 2023 dividend of $0.875 per share (adjusted for 20 for 1 share consolidation), payment date of March 28, 2024



Executing Strategic Objectives

• Completed ~$240 million in liquidity and value-enhancing divestitures at accretive multiples(f)

• Reduced debt outstanding by ~15% (~$233 million) versus 2023 Interim (Q2) results

• Fall borrowing base redetermination resulted in $50 million increase to $435 million

◦ 100% approval from 14-bank lending syndicate

◦ $305 million adjusted borrowing base to reflect recently announced $200 million asset sale

• Maintained leverage ratio of 2.4x(g)

• Current Liquidity of ~$135 million

◦ Increase of 31% ($32 million) versus 2023 Interim (Q2) results

• Commenced trading on the New York Stock Exchange, expanding access to US investors and improving trading liquidity

• Affirmation by Fitch of all five ABS rated notes as BBB or higher (Investment Grade)



Creating Value Through Stewardship

• Won ESG Report of the Year from ESG Awards 2023

• Awarded Oil & Gas Methane Partnership 2.0 (OGMP) Gold rating for the second year

• Increased MSCI sustainability rating to AA leadership status

• Conducted over 246,000 leak detection surveys using industry-leading and proven detection equipment, attaining a zero emissions rate of 97.75%, proving the positive impacts of our commitment to eliminate methane leaks

◦ Completed leak detection surveys for 100% of Central Region upstream assets and continued leak detection surveys for all Appalachian upstream assets

• Continued proactive, voluntary leak detection program for Appalachian midstream assets using industry-leading and proven aerial LiDAR from Bridger Photonics

• Retired a total of 384 wells through the Company's Next LVL asset retirement business

◦ Achieved goal of retiring 200 Diversified wells in 2023; significantly exceeding state agreements

◦ Retired 184 wells for outside parties, including 148 for state and federal orphan well programs

◦ Generated revenues from third-party well retirement projects to offset the Company's internal well retirement costs

more.....

[podgyted] 29/1/2024 21:40

There's always two sides to an argument - we'll just have to see. I've got the horrible feeling I should be in for the TU but I've convinced myself I shouldn't take the risk.

Good luck.

[bountyhunter] 29/1/2024 21:26

Up in New York by about 4% since the LSE close at the bell.

[bountyhunter] 29/1/2024 21:23

On the plus side DEC can make acretative acquisitions more cheaply while the price is low. Demand is increasing while the price is low and production is not forecast to keep up with increasing demand, so the price is not likely to stay down in the doldrums. It's cyclical.

[bountyhunter] 29/1/2024 21:17

I've added today's Motley Fool article link to the header.

"...Despite all the turmoil, if I had some spare cash I’d still invest in the company. As Warren Buffett famously advised: “Be fearful when others are greedy … be greedy only when others are fearful“.

It hedges the selling price of over 80% of its production. This guarantees that it has sufficient revenue to service its debt and pay a generous dividend..."

[podgyted] 29/1/2024 21:15

This is not daily fluctuations. This is a general downtrend at the moment that could seriously compromise the prices DEC can get in the future.

US is awash with natural gas at the moment is what the market is saying and this will kick on into the future.

Its also worth considering that 20%-10% is unhedged currently - the Mar and April contracts are threatening to go sub $2 - that will have an impact compared to the past.

I'm sitting on the fence at the moment 'cos I don't want to be in for the imminent TU, but I consider the NA natural gas market substantially more risky, on a medium term view, than it has been in the past.

BWDIK

[bountyhunter] 29/1/2024 21:01

Daily fluctuations in the Henry Hub price don't really matter for DEC as over 80% of their production is hedged for months/years ahead (as mentioned in today's Motley Fool article).

[bountyhunter] 29/1/2024 20:22

temporary ban on permissions for new LNG projects only :-)

[kaos3] 29/1/2024 19:18

ps - i read that texas is 3rd gas exporter worldwide and that export ban could be a form of punishment texas for its open borders policy refusal

[kaos3] 29/1/2024 19:17

i would also add that size /depth/ of the well matters hugely. dec has older wells, shallower imho. so their well retirement costs must me by definition much lower /independent who is doing the retirement/ - compared to the rest avarege

[laurence llewelyn binliner] 29/1/2024 19:16

Hit them where it hurts, with good old fashioned positive news and numbers..

29.02.2024 XD - shorts will have to run for cover.. :o)

[bluemango] 29/1/2024 18:54

I would rather they hurt the shorters financially by simply & unambiguously demonstrating continuing robustness of the business model, including sustainability of income flows & dividends over the medium term.

[justiceforthemany] 29/1/2024 17:56

The company needs to launch legal action against the short selling hedge funds on the basis of insider trading and market manipulation.
DEC would win IMO.
The evidence is damning.

[bluemango] 29/1/2024 17:13

#7726

The writer's conclusion (with some obvious caveats) is that no, it's not 'stuck in a doom loop'.

[mondex] 29/1/2024 17:05

From S&P Global Commodity Insights:

"Global gas demand is set to grow by 2.5% year on year in 2024 to about 4.19 Tcm, the International Energy Agency said Jan. 26, with lower prices expected to contribute to recovery in consumption.
In its first-quarter gas market report, the IEA said demand growth was expected to be concentrated in fast-growing markets in Asia Pacific and gas-rich countries in Africa and the Middle East.
However, it said demand growth in key markets in Asia and Europe would be capped by the limited increase in global LNG supply, which is expected to grow by only 3.5%.

It also warned that its 2024 forecast came with an "unusually wide" range of uncertainty.

"Potential start-up delays at new liquefaction plants, a tense geopolitical context, worsening feed gas issues at specific legacy projects and risks related to shipping all represent downward risks to the current outlook," it said."

[bountyhunter] 29/1/2024 16:34

They won't make anything unless they close in time to avoid some potentially hefty margin calls and liabilities for dividend payments.

Closed almost at par in London down less than half a percent on the day at the LSE close.

Rising now right on queue in New York post the LSE close.