wonkca2000 wrote: The management team of BTE is very good and talented. In the past, they managed very well and I think going forward they will continue to do so.
Having said that, they made a very critical error or "sin" for that matter of not planning or knowing the "worst outcome scenario" when they acquired Eagle Ford and added $1.5 Billion debt onto their balance sheet.
Its business 101. You learned from Accounting classes and graduate courses. Its blows me alway the management had no clue what would happen if oil price would reach historic lows, especially in commodity business. Everything and anything could happen in commodity prices. Just look at the history of every commodity business. It happens and it happens again and again. It could be in one year or 100 years, It happens. And lucky for BTE shareholders, it happened to us last 12 months.
The BTE business model is not like a regular run business. Its income based business. The management team and the BOD should know better to run stress test on the company if the price of oil goes down when they added $1.5 billion dollars on to their balance sheet.
Every unit holders of BTE is relying on BTE to deliver safe dividend payment every month without additional risk exposure.
Having the BTE go down to $1.08 in the month of January is unacceptable. When the oil goes back to $50, BTE SP will go back up, I get that! But mgmt should never put BTE shareholders into that situation.
I'm not calling CEO to resign, get fired, or hire me, but something has to be done. Whether to redo their compensation to justify their poor judgement or incentive plan tied to stock price prior to Eagle Ford acquisition.
My free advice to the BofD is that the mgmt do all they can to raise the stock price by paying down the debt to manageable level if that means no dividends.