Diversified Energy Share Discussion Threads

[rik shaw] 19/3/2024 07:50

Agreed but I was pointing out that 12.5% was not accurate. You can't divide dividend in dollars by share price in pounds ....!

[this_is_me] 19/3/2024 07:49

It looks like a good long term plan and the dividend is still high.

[fordtin] 19/3/2024 07:49

rik - don't forget most UK shareholders will get even less after witholding tax

[hericsaba] 19/3/2024 07:48

Just wait 15 minutes, it will be more than 10%... LOL

[rik shaw] 19/3/2024 07:43

$1.16 (91p) pa dividend against 920 share price is just less than 10%

[leoneobull] 19/3/2024 07:42

12.5% dividend I about 6 to 7 times the typical US dividend . They prefer capital growth, hence the acquisition

[marksp2011] 19/3/2024 07:41

Oh dearThat'll put the cat amongst them.So the tender offer was illegal.....doesn't look like a company in control does it55% dividend cut and a fixed divi to be held for 3 years. Nout said about what happens when the tree years are upI am unable to translate all the word salad into English but it looks like a Company in it's death throesExplains why they didn't try and issue shares in the USA - they would have gone straight into a class action lawsuitI struggle to believe they weren't aware of all this material information prior to the annual results.

[bountyhunter] 19/3/2024 07:40

It's a large acquisition of 122 MMcfepd (80% natural gas) increasing production by ~15% and made while prices are low. Net cost $386m which is why the dividend is reduced but sustained for 3 years. Maybe the best long term strategy with uncertainty reduced.

"In conjunction with the asset acquisition and following the Company's capital allocation policy review, the Board has set the new quarterly dividend to $0.29 per share which equates to $1.16 per year. This fixed quarterly dividend payment will be sustainable for at least three years and maintains a top quartile pro forma yield1, among FTSE350 and higher than a majority of US listed peers, while providing the Company financial flexibility to reallocate approximately $110 million annually of capital towards the other elements within the updated capital allocation framework. When combined with our planned debt reduction through amortization of approximately $200 million in 2024, the capital allocation framework will allow for an opportunity to meaningfully reduce leverage and remain within the Company's stated target leverage range of 2.0x to 2.5x. In addition, the Company will have increased flexibility to conduct a strategic and regimented share repurchase program, while also providing for the opportunity to make accretive acquisitions. The updated capital allocation framework will take effect with the recommended final dividend for 2023, payable in June 2024."

[fordtin] 19/3/2024 07:39

They need to change the slogan to; Diversified is the Wrong Company at the Wrong Time!

[stevensupertrader] 19/3/2024 07:36

Those shareholders that are looking for high div suddenly have their dream wipe off overnight . 66.7% div cut is a big amount .
All the gloss painted by DEC over the many months was coming to roost .
I can see the tender offer won’t fly.

[assagai] 19/3/2024 07:27

Don't know. PI's will view this with disappointment but it maybe becomes more attractive to Instis. We'll see how it pans out soon enough. At this level the new divi is guaranteed at 12.5% pa for three years. That's attractive to NEW investors.
Personally an increase to SIPP will follow.

[laurence llewelyn binliner] 19/3/2024 07:24

So much for my sustainable dividend policy theory.., however, accelerated debt reduction does make a lot of sense..

[kaos3] 19/3/2024 07:21

a man with a plan.... they fixed divi for 3 years. when the majority of the debt burden will be paid off and replacement aquisitions will be made in full plus some.

makes sense to me.

i only expected divi to be cut less. but that could be compensated by the BBs.

if tender offer was a maneuer - it was a brilliant stroke against a falling share price otherwise - change advisers. one never knows what did they do for real

i like this co more and more

glad i have some spare liquidity waiting

[tag57] 19/3/2024 07:19

Wow, the share price drop is really going to hurt today.
LAB305, apologies as you were absolutely correct and did the right thing getting out.

[leoneobull] 19/3/2024 07:18

Tender offer cancelled does make them look like muppets as they fell foul of US laws...despite being American

[nigelpm] 19/3/2024 07:17

Ugly RNS. Slashed dividend...tender off canceled. Big fall would think.

[leoneobull] 19/3/2024 07:03

Profits look good, FCF but big acquisition hence dividend cut to 0.29 USD per quarter. Exposure to Gulf Coast pricing.

[laurence llewelyn binliner] 18/3/2024 19:56

Is the model not all about sustained dividend payouts, and debt repayments with acquisitions to build and replace volume declines..

The share price is not the limiting factor dictating the dividends, free cash flows are and with 80/85% of production hedged these are shielded..

Annual report 2021 - the boards target is to return not less than 40% of FCF to shareholders by way of dividends on a quarterly basis, in line with the strength and consistency of the groups cash flows.

Annual report 2022 - The boards target has been to return FCF to shareholders by way of dividend, on a quarterly basis, in line with the strength and consistency of the groups cash flows.
The directors may further revise the groups dividend policy from time to time in line with the groups actual results and financial position. The boards dividend policy reflects the groups current and expected future cash flow generation potential..

2023 - due next, and an interesting day coming up tomorrow..

[bountyhunter] 18/3/2024 19:40

Agreed Tag, that's how I see it as well or the tender offer would have not been a wise move. There may have to be a dividend cut at some point in the future if gas prices fail to recover and long term hedging is affected but that won't be the next divi imho. Even long term holders must still be receiving a 10%+ yield right now surely?

[tag57] 18/3/2024 19:35

I genuinely can’t see DEC management proposing the tender, with the proposed average period following the quarterly results, if they expected to issue poor numbers.

[fordtin] 18/3/2024 19:30

If DEC go down the divi-cut rabbit hole, let’s hope the major shareholders catch the falling knife, then push the 5 day average above £8.9048.
If they play it right, the majors could buy up to the equivalent of ~7% of their shareholding at fire sale prices, then tender them for £9.35 or more.

[bluemango] 18/3/2024 19:20

Conversely, a sustained dividend level would be hugely bullish.

[bluemango] 18/3/2024 19:16

I agree, absolutely, that existing investors would obviously not want to see a halved dividend.

My point is that the market looks at the current situation, and that would be a still-decent yield for buyers tomorrow. Therefore, all other things being equal, logically the further downside in share price should be limited. Agree it would be pants for historic investors like ourselves.