RE:RE:RE:Today's price dropI'm not sure your reasoning to bring up 2013 annual report, when we can go with Q3 MD&A?
I didn't see anything regarding Debt to EBITDA in the Q3 report.
However the other numbers have changed since Q4 last year.
Senior debt to Capitalization Max=.5:1 Current=.42:1 Senior Debr to adjusted income Max=3:1 Current=1.71:1
Total Debt to adjusted Income Max 4:1 Current = 1.71:1
And finally Fixed Charge coverage Min=2:1 Current=9.93:1
These numbers will of course change for the worse in the coming quarters.
As for the dividend. It really doesn't matter why it's at 14%, the fact is that's where it is. You just can't payout that much of your income and hope to stay afloat and grow.
Some oil companies have tried, but I can't think of any that have been succesful.
It's costing most companies a lot of $$$ to keep their production at current levels (especially tight oil), nevermind increasing production. This is one of the reason's I believe oil prices will rebound. Most of the easy, slow declining pools of oil have been tapped and most new oil is expensive to produce and maintain.
tvstock wrote: More sharing :
https://www.baytexenergy.com/files/pdf/investor-relations/Annual%20Reports/2013%20Annual%20Report.pdf
PAGE 19
Covenant Description Maximum Ratio December 31, 2013
Bank loan
Senior secured debt to capitalization MAX 0.55 2013 is 0.11
Senior secured debt to EBITDA MAX 3.00 2013 is 0.35
Debt to EBITDA MAX 3.50 2013 is 1.07
Long-term debt
Fixed charge coverage MAX 2.50 2013 is 0.08
With the acquistion senior debt increased , capitalization also incresed by similar ratio by the offering. EBITDA increases as more production . Fixed Charge coverage say triples, still way below the trigger.
And the 14% yield is caused by the stock price drop.