Serica Energy Share Discussion Threads

[bountyhunter] 06/5/2024 12:03

If they had returned the cash pile to shareholders as I advocated at the time of the Tailwind acquisition (and not made that deal) we would now have around £2/share including interest in the bank and hold the shares for free.
But we are where we are and looking outside of UK waters is sensible so long as not funded by cheap equity, but what is the tax rate in Norway, isn't it also very high? I suppose at least that would be a known and factored into the price and avoid the political turmoil of the UK.

[officerdigby] 06/5/2024 11:57

For the anti Tailwinders.Of which, initially, I was at least bemused by it!You'd have to say with the current gas price and tax environment, Serica would probably be sub £1 without the deal. No?How much revenue oil vs gas now? Maybe the gas price situation will turn around.Maybe, finally, real grown up green policies will be introduced? Low carbon local gas - will become political - it is possible. Just not now in the middle of political election year. The greens would have to get real. Imagine climate protestors focusing only on LNG imports. Campaigning for local gas (less CO2) - could it happen? Lols.Don't see point of buy back, but note that it is minimal.Hopefully, get some assets outside UK, now.

[bountyhunter] 06/5/2024 11:37

Thanks td.

[oilinvestoral] 06/5/2024 10:17

Fingers crossed this comes to fruition! If they can secure this ("at a reasonable price & WITHOUT raising equity") it's an absolute game changer! It completely changes the complexion of Serica's investment case and diversifies our production away from the regressive tax system that has now crippled the UKCS!

[thedudie] 03/5/2024 11:20

It seems to originate here ...

[bountyhunter] 03/5/2024 11:07

Cowie193 May '24 - 10:49 - 6151
Serica appear to be bidding to buy a company in Norway.

Where did you see that, do you have any reference link?

[gkace] 03/5/2024 11:02

Serica bid for the assets as it seeks to diversify away from the UK, where it has been hit by the impact of the energy profits levy put in place in 2022. Aker BP, which was created in 2016 by BP Plc and Det Norske Oljeselskap ASA, has continued to expand in Norway, and merged with Lundin Energy's oil and gas activities two years ago. Deliberations are ongoing, and there's no certainty the potential buyers will proceed with formal bids, the people said.'Sval has 70,000 barrels of oil equivalent a day from 15 producing fields, with another six projects in development. The firm has stakes in fields including the Greater Ekofisk Area, Ivar Aasen and Martin Linge, according to its website'

[cowie19] 03/5/2024 10:49

Serica appear to be bidding to buy a company in Norway. More to come on this.

[melton john] 03/5/2024 09:53

undervaluedassets, thank you. You politely asked me to reconsider so what goes around comes around. I try not to be disagreeable in disagreeing with people, it's hard :-)

[return_of_the_apeman] 03/5/2024 09:15

The buybacks coupled with the upcoming large dividend are strong short term price drivers surely

We shall see

[croasdalelfc] 03/5/2024 08:06

'Sell' shares at 278p to Tailwind and buy them back for 200p - that was the plan all along!Only 109.5m to go! .... That acquisition gets cheaper everyday Tongue firmly in cheek.. :) Happy buybacks everyone

[ekon2] 02/5/2024 19:44

fair point

[wallywoo] 02/5/2024 15:53

You see this situation again and again in the oil sector. Many stocks are super cheap.


Imho, this has more to do with the investment funds and institutions than it does with the value of the stocks themselves. It has become deeply politically incorrect to be invested in the sector. Many of these funds don't want the reputation damage of not being green. They can get away with BP and Shell perhaps (who have green stripes) but not the pure oil and gas producer's.


Of course, the world still consumes plenty of oil and gas which is unlikely to change anytime soon. The added tax by the government makes no difference to the environment, but does support a huge UK borrowing requirement!!

I think the pi can benefit here by trading these stocks in ISAs and SIPPs. The income is tax free, and the stock will trade a range (albeit at a low valuation). Just my take. Picked some up today at 180.5. With a bit of luck I will benefit from the dividend at the end of June and hopefully the current drilling will be successful and the production expectations will increase. The current share buybacks and cash rich nature of sqz, adds to the liklihood of this being a good trade imo.

[undervaluedassets] 02/5/2024 13:56

Melton ... you are a gentleman.

(I get stuff wrong all the time and find it hard to apologise ... esp with my wife which is always a mistake.)

So you sir, are a cut above.

[melton john] 02/5/2024 13:04

Sorry, you're right.

[weemonkey] 02/5/2024 12:32

George Soros used to say, contrary to the popular take that the "market is always right", that the market was always wrong. And that shares are always too cheap or too expensive. this makes sense to me otherwise prices would be a lot more static than they are.

What investors have to do is decide "what kind of wrong" they are dealing with.

At the moment market action is telling us that the price is too high for this stock and that the downtrend is correct and that there is something investors have missed.

The fundamentals seem to say price is wrong and that this is selling far too cheaply.

which is right?

We will see.

[undervaluedassets] 02/5/2024 11:10

Melton.. revisit your maths please

18 x 450% is 81 add back the original 18 is 99. (not 103 obv.. these were roughed out numbers)

Anyway ring the company and ask if they think they are undervalued or not.

Recent substantial director buying tells the story.

[fenners66] 02/5/2024 10:56

Still an argument being made that the oil price will accelerate in the future and a hedge against that would be to hold some producing oil companies.

[fenners66] 02/5/2024 10:54

I looked at these for the first time after results and then the share price went up.
Meaning that the financials were fine and market was happy to buy and rate higher.
Its the sentiment that has changed given the Deltic news.
When sentiment changes it seems to me the professionals let it take over for a while , they can sell and always buy back cheaper lower down, especially with smaller companies , but where the financials are genuine the sentiment will turn back to those in time.

[melton john] 02/5/2024 10:48

"So actually the results from 2018 showed at £18 million profit.. so £103 million post tax now signifies an increase of profits of more than 450%"

The point meannreverter is making is that a doubling of profit is a 100% increase tripling is 200% so 4.5 times is a 350% increase. INCREASE compared to ORIGINAL is 3.5 times.

[meanreverter] 02/5/2024 10:44

undervaluedassets: Sorry, I overlooked the change of currency. Anyway, the market now values Serica, on the basis of its post-tax earnings, at a multiple of 7. This seems low. Perhaps the fear is that Labour will rack taxes up to an even more crippling level.

[undervaluedassets] 02/5/2024 10:27

Perhaps it is better to quote operating profits:-

In 2018 operating profits were $ 9 million dollars (£6.42 million)

In 2024 operating profits were £321 million pounds.

And over that period the share price has gone from £1.40 to £1.80.

Anyway, whichever way you slice it the point is made.. The undervaluation here is striking even in this high tax environment.

The point I am making is this has gone from a non-producing minnow to a significant mid-size producer without a commensurate raise in the rating.

Trust me ..Other parties will be running their sliderules over SQZ .

[undervaluedassets] 02/5/2024 10:01

meanreverter, for whatever reason the profits for 2018 were listed by the company in dollars, not Sterling.

on the date in question there were 1.4 dollars to the £.

So actually the results from 2018 showed at £18 million profit.. so £103 million post tax now signifies an increase of profits of more than 450%

(I put the 2018 profits down in $$ as I quoted verbatim what the Serica did when it reported on 17/04/19.)..

[meanreverter] 02/5/2024 09:49

103 is (approximately) 300% more than 25.2 — not 400%.

[undervaluedassets] 02/5/2024 09:15

On 17/04/19 Serica announced final results for 2018 with pre tax profits of 25.2 million dollars (dollars mark you). The share price was £1.40 on that day

Pre-tax profits for the full year a few days ago were £305 million and the share price is now £1.80

"Yeah, but the UK tax situation".. Yeah, I know, I get it.

But even after the ridiculous taxes of £202 million 2023 profits are £103 million.. 400% more than the profit in 2018

But the share price has moved a paltry 30% since that time.

(NTAV has also gone from £131 million to £635 million over the period)

The word "Undervalued" does not adequately cover the situation here.

I would suggest that if British investors do not appreciate what they have; then, as seems to be the trend with UK market, it will be taken from them by grateful foreign hands. And once again UK investors will get a few pieces of silver and foreign hands will get the value that the UK's collective indifference and idiocy has created.

You don't know what you got till it's gone.