Share Name Share Symbol Market Type Share ISIN Share Description
Premier Oil Plc LSE:PMO London Ordinary Share GB00B43G0577 ORD 12.5P
  Price Change % Change Share Price Shares Traded Last Trade
  -0.34 -0.42% 80.36 15,113 08:02:00
Bid Price Offer Price High Price Low Price Open Price
80.44 81.16 80.36 80.36 80.36
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 1,095.86 124.05 13.57 5.9 662
Last Trade Time Trade Type Trade Size Trade Price Currency
08:00:54 O 5,000 80.7005 GBX

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Premier Oil (PMO) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
2019-10-15 16:13:4780.7054,95544,346.49O
2019-10-15 15:55:0680.6321,14717,049.98O
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Premier Oil Daily Update: Premier Oil Plc is listed in the Oil & Gas Producers sector of the London Stock Exchange with ticker PMO. The last closing price for Premier Oil was 80.70p.
Premier Oil Plc has a 4 week average price of 70.88p and a 12 week average price of 64.48p.
The 1 year high share price is 128.90p while the 1 year low share price is currently 54.70p.
There are currently 824,330,795 shares in issue and the average daily traded volume is 5,935,385 shares. The market capitalisation of Premier Oil Plc is £665,234,951.57.
master rsi: Not easy but managed to get the report without registering ........... PMO - Premier Oil Is Cheap, But Upside Is Doubtful Aug. 27, 2019 6:10 PM - Vasily Zyryanov In 1H19, Premier Oil improved both the P&L and cash flow statements; FCF soared on the back of higher production and lower costs of operations. The company initiated a sales process of its stake in the Zama field offshore Mexico to repay debt. Due to the uncertainty over the global recession and weak revenue growth in the 2020s, I rate the stock as "Hold." Premier Oil (OTCPK:PMOIF, OTCPK:PMOIY), the London Stock Exchange-listed exploration & production company, currently trades at only ~0.7x P/B and ~3x EV/EBITDA. This level may seem attractive for value investors who seek underappreciated companies with a decent strategy, reasonable governance, and a possible turnaround in the short term. One of the culprits of low trading multiples is April-August 2019 sell-off. For broader context, since August 2018, the FTSE 250 constituent's market capitalization plummeted from ~$1 billion to ~$621 million. The primary downside catalyst was Brent price volatility, which arose from the global demand concerns stemming from a trade war. The oil price was also the essential catalyst of Premier's recuperation in the first half of 2019 when its share price had soared ~57.5% from January until late-April. In a few cases, cheap valuation stems from deep, cardinal issues that are not noticeable upon cursory inspection. In the article, I intend to examine the available financial information and conclude if bargain-level ratios are fully justified or imperfect valuation arises from temporary inefficiency and emotional bearishness of the market and will be eliminated soon, thus creating a lucrative investment opportunity. Now let's take a more thorough look at the company. The top line Incorporated in Scotland, Premier Oil generates the bulk of revenue (and EBIT) in the United Kingdom (the Catcher Area, Huntington, the Solan field, etc.) Blocks offshore Vietnam (the Chim Sáo and Dua fields) and Indonesia (e.g., Natuna Sea Block A) also contribute to the top line, but to a lesser extent. The total production in 1H19 added up to record 84.1 kboepd (10% higher than in 1H18); 41% came from its flagship asset, the Catcher Area offshore Great Britain. The Catcher performs prodigiously; the company even anticipates to increase its reserves in end-2019 due to strong subsurface performance (see p. 2 of the release). The most recent half-year results presented on August 22 contained a few improvements worth meriting. All the essential metrics like revenue, EBITDAX (a 39% increase compared to 1H18), EPS (a 23.4% increase), and FCF (defined by the company, see glossary on p. 48) were far better than in 1H18; net operating cash flow more than doubled. These results were achieved on the back of higher production and high operational discipline. Speaking about growth prospects, I should mention that Premier currently develops the Tolmount gas field in the Greater Tolmount Area, on schedule and below budget. First gas from the field will support 4Q20 and FY21 revenue and operating cash flow. Also, first gas from Bison, Iguana, and Gajah-Puteri (BIG-P) fields offshore Indonesia will bolster the top line in 1Q20. Deleveraging is vital One of Premier's key drawbacks is that it is saddled with a total debt of $2,386 million, which translates into a Debt/Equity ratio of 2.15x. At the same time, Net debt/EBITDA (I used LTM EBITDA figure provided by Seeking Alpha Essential) stands at 2.16x, which is not ideal but also not terrifying. Apart from that, due to the increasing amount of borrowings, interest expense (on an accrued basis) soared in 2016 compared to 2015 and, since then, has been continuously growing, hammering the bottom line. As my esteemed readers likely know, it is not just tough and challenging, but nearly impossible to create shareholder value and prop up Market Value Added when the balance sheet is burdened by immense debt. Yet, Mr. Market does not always reprimand stocks that have humongous debt. Here I should remind that Swedish E&P company Lundin Petroleum (OTCPK:LUPEY) even has negative net worth due to cyclopean amount of borrowings on the balance sheet; yet, investors, mesmerized by revenue growth prospects secured by the Johan Sverdrup oilfield and calmed by safe Net debt/EBITDA ratio (interest expense is minuscule, by the way), are ready to even pay a premium for the share. Premier Oil picked a method that energy companies across the globe actively used to ameliorate their capital structures and enhance returns during the oil market meltdown. It decided to divest the stake in the prolific Zama field (810 mmboe in gross resources) offshore Mexico and fully exit the project while retaining a stake in the adjacent Block 30. As the firm trims its exposure to the project, it becomes apparent that growth is not its priority at the moment. It has both pros and cons. Let me briefly clarify this. If an oil company scales down exploration activities or divests stakes in prolific oil fields that are currently under development, it can receive substantial cash proceeds and reduce the value of long-term assets on the balance sheet, thus boosting returns and reducing future capital investments. At the same time, if because of divestments future production will be too tepid, lower revenue will put pressure on margins jeopardizing EPS, FCFPS, FROIC, and Market Value Added. So, I hope Premier has carefully pondered all the pros and cons. If debt reduction pans out, the market appreciation might follow. Lower interest expense, in turn, will ease pressure on the bottom line. But to regain investor credit, the firm should also proactively manage opex to be able to consistently increase EPS despite soft revenue caused by weaker Brent. Free cash flow According to IAS 7 Statement of Cash Flows, interest paid may be classified as operating, investing, or financing cash flows. In this regard, I recommend taking a more in-depth look at the IFRS EU cash flow statements when computing levered FCF (FCF to Equity) because if we simply deduct capex (e.g., additions to PP&E or oil & gas properties) from net CFFO, we overlook an essential point, especially in the cases of overleveraged companies: interest that was not accrued but actually paid during the period. GAAP requires to classify interest paid only as a component of operating activities; thus, investors who are focused on the US stock market should bear in mind that non-US companies quite often report interest in the financing section of the CFS. So, Premier Oil reported 1H19 FCF of $182 million. This non-IFRS measure was defined by the company as Positive cash flow generation from operating, investing and financing activities excluding drawdowns from and repayments of borrowing facilities. I estimate half-year after-interest FCF to equal $313.8 million (net CFFO minus capital expenditure and interest paid; see the condensed CFS on p. 27 to find these items). Adjusted for decommissioning and lease liability payments, FCF equaled to $186.2 million. This is far better than in 1H18 when FCF (net CFFO after capex and interest paid) was negative $65.2 million. So, Premier did a great job not only boosting accounting profit but also improving cash flows. Dividend The dividend was eliminated in 2015 when Premier had to grapple with oil market headwinds. DPS cut or elimination is always a bitter pill to swallow, but sometimes shareholder rewards not supported by FCF (especially when Debt/Equity ratio approaches unhealthy level) could easily push a company on the brink of insolvency. As Premier's debt burden is still significant, I see that dividend introduction is unlikely in the short term. A quick valuation I suppose it is worth applying EV/EBITDA and EV/Production ratios to compare Premier with its closest peers: Cairn Energy (OTCPK:CRNCY) and EnQuest (OTCPK:ENQUF). Cairn and EnQuest have not presented their 1H19 results yet, so, I used 2018 data. Cairn Energy trades at EV/EBITDA of 7.4x and EV/Production of 67.6x (considering 1.2266 exchange rate to convert GBP to USD). At the same time, EnQuest trades at 2.7x EV/EBITDA and 39x EV/Production. Premier's debt and equity investors are ready to pay $3 per dollar of EBITDA and $35.6 per barrel of oil equivalent. In sum, Cairn looks overvalued as its operating results were distorted by impairment; however, production figures were also not stellar. Both Premier and EnQuest are undervalued, and the main culprit is leverage. Bargain-level valuation is surely not fully justified, as the company's performance is improving. Yet, I reckon in the short term Brent price will not be supportive of the expansion of multiples, as the trade war escalation takes a toll on traders' sentiment. Final thoughts Canny investors who are constantly seeking value stocks with decent prospects may consider Premier Oil as a top pick. However, I suppose they should take into account the anticipated revenue decline in 2020-2022 and tepid EPS growth despite the Tolmount gas field on stream in 2020. At the same time, it is worth noting that Premier could increase 2019 revenue ~13.3% compared to FY18. However, the company pays no dividend and operates in a cyclical industry; hence, it is not apt for a recession-proof portfolio. According to Seeking Alpha Essential, the sell-side analysts are currently pronouncedly bullish. Their sentiment is likely inspired by Premier's merits as high operating efficiency in the Catcher Area and possible reserves increase, more resilient FCF and improved ESG score (e.g., due to minimized emissions at the Tolmount and Solan). Nevertheless, speaking about the market sentiment, I should remind that the Fear & Greed Index provided by CNN Money as one of the key indicators of the current sentiment in the US shows Extreme Fear. Investors are concerned with the repercussions of the trade war, while it is entirely uncertain if new rate cuts will be enough to stave off a global recession. All in all, Premier Oil is a "Hold." However, I do acknowledge that if a trade war is temporarily settled (before likely reignited again, as we have already seen this year) and news headlines serve as catalysts of greed on the stock market, oil stocks will rally. Among the key short-term catalysts may also be the results of the Tolmount East appraisal well and new investor interest to the Sea Lion project offshore the Falkland Islands. Deleveraging also remains vital. Note: Because of unsatisfying liquidity, ADRs do not fully reflect the ordinary share price movement on the LSE. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
beatley: My own thoughts, in a nutshell the oil price is ducking us. Who wants to buy an oil company that returns zero to its shareholders (other than a declining share price). At $75 oil we should be good, at $58 oil, a struggling global economy and warnings about a significantly oversupplied market next year then it isn't surprising that to me that people are taking a negative view of the company. The debt pile is manageable at higher oil prices but with interest rates as high as 9% on some of the senior notes we need higher oil prices so we're not just burning through the reserves to make our creditors wealthy. The shale boys continuing to grow production even though prices are falling and their share prices are being decimated. Moreover, I’m not convinced if there is an oversupplied market next year that OPEC will be willing to concede market share further. Sea-Lion seems to be tied to the export financing, other than a massive equity raise I can't see how we do it at these oil prices without it. I suppose there’s a question mark about whether we'd do it all given the value of spending of that money on a North Sea acquisition to make use of the tax losses. Anyways, happy Sunday, just thought I’d share my gloomy post, hopefully others are slightly positive and can tell me what I'm missing.
sarkasm: Investomania 4 attractive resources stocks? BP plc, Glencore PLC, Tullow Oil plc and Premier Oil PLC Do these resources stocks offer growth potential? BP plc (LON:BP) (BP.L), Glencore PLC (LON:GLEN) (GLEN.L), Tullow Oil plc (LON:TLW) (TLW.L) and Premier Oil PLC (LON:PMO) (PMO.L) June 27, 2019 Robert Stephens, CFA FTSE 100 BP plc BP plc The outlook for resources shares BP plc (LON:BP) (BP.L), Glencore PLC (LON:GLEN) (GLEN.L), Tullow Oil plc (LON:TLW) (TLW.L) and Premier Oil PLC (LON:PMO) (PMO.L) may be somewhat uncertain at the moment in my view. Challenges facing the world economy, notably the trade war between the US and China, could cause demand for a variety of commodities to come under pressure. Still, I think the BP share price offers investment appeal for the long term. The business has adopted a strategy which I think could improve the quality of its asset base, with investment in Upstream and Downstream segments having the potential to catalyse growth over the long run. Although BP’s short-term prospects could be volatile due to geopolitical risks across a variety of oil-producing nations, I feel its long-term appeal could be high relative to its sector peers while it trades on a P/E ratio of under 12. Tullow Oil’s update released this week showed that it is making progress in delivering its strategy. The company is seeking to increase production, while also reducing debt in order to strengthen its balance sheet. Since the Tullow Oil share price currently trades on a P/E ratio of around 10, I think it could offer a margin of safety at the moment. With further investment in its exploration activities, I believe it could enjoy improved performance over the long run. Premier Oil may also offer good value for money at the moment. The oil stock has a rating of around 4, which is among the lowest I can find in the FTSE 350 just now. This suggests that investors are cautious about its future outlook. This is understandable in my opinion, with Premier Oil lacking the financial strength of some of its sector peers. But with the business expected to reduce debt and keep a disciplined stance on costs, I think it could beat many of its industry peers’ returns in the long run. Glencore’s regulatory challenges may hold back its stock price over the near term, while macroeconomic fears may cause investor sentiment to further weaken. However, with the stock having a P/E ratio of around 7, I think it could offer good value for money. Glencore’s focus on ramping-up production of materials used in electric vehicle batteries could lead to a tailwind over the long run.
whiskeyinthejar: I seem to disagree with most here, as I don't think that share price has been forced down mainly by sentiment. The share price is down because fundamentals are down imo. In fact, I read somewhere that no oil producer on lse trades above NAV. Even if this isnt wholly true, it's still important observation because we know Premier's NAV is very dependent on POO. IMHO it's why share price falls sharply when POO falls. This is what Arden Research say about Premier: "Given the net debt level and significant production element of the portfolio, our valuation is sensitive to oil price. Base case NAV is (15p) core, 125p total risked and 253p total unrisked using US$65/bbl long-term real, but risked NAV rises to 213p using US$75/bbl and falls to 34p using US$55/bbl" So they calculate risked NAV is 213p at $75 poo, but only 34p at $55! UBS have stated similar in past: So booking in more reserves (or derisking projects) would increase the NAV and make Premiers NAV less dependent on producing assets. Sea Lion, Zama, Catcher satellites, Tolmount should each be adding reserves soon. Increased NAV should mean increased share price. So I'm bullish on Premier because I believe long term poo should average $65 and Sea Lion etc will go ahead. So NAV of £2+ is achievable. I don't have firm view of whether we should sell Zama. Selling Zama would reduce debt, but we'd lose NAV uplift which is near term catalyst for share rerating. And undeveloped, we'd only get $2-$5 dollars per barrel for it. By the way, as I understand it, the Project Information Memorandum (PIM) for Sea Lion is supposed to be completed this quarter, and that's the basis for submitting the application for funding from export credit agencies. So Id say by the next update, they should be applying for Sea Lion export finance. Sea Lion timeline shouldn't slip, executive bonus' depend on it! However, if SL isn't approved for some reason, my guess is Premier will much more likely up for sale. Not just because FI puts off some buyers, but also because it's a 'career defining project' that management and BOD want to see through.
montevid: GS still manipulating the PMO share price with the other shorters. At $71 per barrel the PMO price should be clearly higher.
whiskeyinthejar: Marvin went on about all this before last trading update, and one before. The story goes that because share price isnt doing what we want, then shorters must be fraudulently being fed inside information by pmo. Have to say it doesn't follow. So what was this negative information in the last trading update, or prior one that insiders knew about before and retail didn't? Was it that debt targets are being met? Or was it that Catcher was over performing? I can't see that there has been anything that insiders could've been fed that was any use to them. Genel has a similar chart to PMO. It has similar risk on/off behavior too. It's share price also halved from last year's high to a low at end of December. Since then its share price has recovered, but has got stuck under £2 in same way pmo is has met resistance at 80p. Are Genel shareholders speculating they have insider traders controlling their share price? Ironically a former Genel director was done for insider trading, but i haven't seen any speculation on advfn that Genel CEO is engaging is criminal activity. Perhaps because Marvin doesn't post on Genel. This whole idea that one or two players can control the share price of a large company is bogus imo. In short term with deep pockets or high frequency trading an institution can push the price how it wants. But if wider market is moving in opposite direction all that happens is they'll lose money. Like a football being pushed into a swimming pool, shorting it down against buying pressure doesn't work. It's simple imo- if there's enough buyers in medium term the price goes up. Looking at chart, i think Pmo hit a double top at the beginning of January at 80p. We all know the Gann theory that double top signals a loss of confidence that share price is ready to go higher. And so it's proved, confidence had flagged. Other part of Gann theory though, is that the 4th try at breaking resistance level usually succeeds. Link as I guess many will say I made 4th time lucky theory up! hTtp:// Gann published 286 of his trades in advance in a newspaper. About 90% of them came off. I don't think anyone on advfn can trade this well. Absolute legend. Anyway doesn't matter too much, 4th or 14th attempt, I can wait. However, I can't prove the fundamental reason why we failed to break 80p in January. But IIRC: - it coincided with brexit vote which May lost. The chat then was a general election was option and therefore the prospect of a Labor government more likely. Corbyn wouldn't be good for north sea or Sea Lion approval imo and uncertainty is always bad. Since then option of early general election seems to have faded. - it coincided with Times article. timing was bad as it came at 80p inflection point. - share price had risen by about a third in three weeks. That's a fair bit in a short period so bound to be profit taking - brent was only $60. I haven't done the numbers but UBS have and they calculate at $60, pmo is only worth 77p NAV with the upgrade to the Catcher FPSO. The other part of this is that UBS calculate that with Sea Lion approved, Zama, appraised and Brent at $80, NAV is £2.90!! So there's an arithmetic reason why we are so geared to oil price and why the share price halved. No need to resort to exotic theories then. Occam's Razor anyone? Anyway, I think it's a reasonable opinion to believe someone else could run pmo better. He's 60 this year, must be near retirement. More difficult to understand is why Marvin wants to fist him in the car park at Nandos though. But i think Durrant leaving right now would be disruptive, Durrant will have lot of business knowledge and several projects are at key stages. Also the company strategy is tied to the BOD rather just Durrant. It's not like a AiM oily where the CEO is key, bigger oil is more of team game imo. So him leaving won't change strategy and operationally, PMO are now performing well under Durrant. Anyway I think the pmo specific problem that weighs on the share price is their strategy. They have so many options to sell assets or grow in Mexico, North Sea, Falklands etc. that it looks like they lack a plan. Big thing then is getting FID on Sea Lion and outline plan on Zama. Zama development should be cheap as they only have 25% of cost and intend to use appraisal wells already drilled as producers, but lots of uncertainty about plans and whether Zama should sold etc Unfortunately no listed company will tie their hands by ruling out a placing.But I don't see need for pmo to sell Zama or do a placing unless oil sinks badly. I'd say the possibility of pmo selling off assets in a fire sale has actually weighed on share price in past. They wouldn't get a good price if they sold Zama or SL undeveloped. Seems unnecessary, because if similar performance to Q4 continues they should be able to pay down more debt from cash flow this year than they'd get for Zama. However, what I think they should do counts for nothing, but imo Premier needs to clarify their story. Then they can up the PR and can say to institutions invest in us because they have a clear plan and certainty of funding in place to implement plan. They can say 'we're going to make pots of cash in Sea Lion', instead of woolly current situation of final decision hasn't been made. It's also my personal preference not to invest in exploration or the wait between discovery and funding in place. However once you have funding sorted, I think you can make good money waiting for first oil and the project to be priced in. Anyway, I think more clarity will come in next update in March and there ought to be significantly more interest in PMO with FID for Sea Lion sorted. But I think to see real value here you'll need to wait another 2 years for first oil at SL and Zama, not 2 weeks. Sorry long post.
rbonnier: What has got to happen here for the pmo share price to recover to a more realistic valuation ? Oil price recovery hasnt worked so whats going to snap the elastic bid story in the sunday telegraph ?
marvinridesagain: Why is such anger centred against me? All I am doing is stating the obvious share price manipulation being made by Jabbas insider shorting sewer rats. Share price is being kept low just before yet another comical rights issue. This will yet again crucify the share price and enable a cheap sneaky take over by yet another one of jabbas puppet masters. Resign Jabba, only then will this share price depression end. PMO should be at least £1 now!
montevid: GS is manipulating the PMO share price with its controlling CFD position of approx.6% as well as the shorters: Shorter - Current Percentage - Effective Date AHL PARTNERS LLP - 2% - 2019-02-06 WHITEBOX ADVISORS LLC - 1.11% - 2018-12-18
seangwhite: POO going up lifts the PMO share price as we all know. Any hint of a rights issue will knock it back. The BOD were slow to react to the last rumours and not very proactive on the promotion front with the institutions.Let's hope POO keeps going up as the current BOD's efforts are fairly hopeless as shown by the share price graph.
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