Cardinal Energy Ltd (Alberta) T.CJ

Rabbit Hole

[4thefunofit]

Got bored and did some math.

Most of the following figures and notes are from Cardinals February presentation and then I've laid out my calculations so you can see how I got there.  Please poke holes if I make an error or a bad assumption.

Cardinals FCF for the 2022 at $90 WTI is 252($MM)/4quartes =63($MM)/quarter. 

WTI has averaged about $94 for Q1. Additional $4*20,500bbl/d*91days=7($MM)

FCF for q1 should be about 70($MM)

Phase 1 debt level "100%of FCF will go to bank debt until bank debt is below 100($MM)..."

Bank Debt at Dec 31, 2021 was 165($MM)

165($MM) - 70($MM) = ~95($MM) of bank debt at end of Q1.

"The dividend rate is expected to be fixed at the prevailing oil price when phase 1 debt level is achieved..."

If my calculations are correct they should hit phase 1 debt level around now and as I write this the prevailing price is $103 WTI.

If I extrapolate their dividend chart 103 WTI should give a monthly dividend of $0.09 per share per month giving a 14% yield at todays share price. 

GLTA

[MohelJFox]

Well done, I like it. Now everyone buys sells and holds for whatever reason they choose. Myself at this moment, and this is just my hunch, i feel there will be a special news release. "Cardinal energy is pleased to announce it has entered into the next phase of debt level repayment and wishes to distribute a one time special dividend of 3c, followed by the commencement of its floating

[MrICE]

Calculations seem fair. Nothing has changed much from what they said in last financials. Oil is higher all things considered we are there now with debt. A special dividend is easily done. They have the cash. Think May 18 for reporting is a long way off not to say or do something sooner. 

[MrICE]

May 12 for financials. My mistake 

[TMIC1048]

I like it but I suspect their CAPEX is front loaded so would expect their net bank debt to be higher upon exit for Q1. I'm also anticipating they will at most fix the dividend at $90 WTI to hold a conserative approach to the introduction of the dividend, which would yield $0.07/share/month. I'm totally ok with that because that should imply any net is being directed to paying down further

[GoldenArm]

Your Rabbit hole gives us a warm fuzzy feeling. Numbers are great but increased production at these prices is way better. Dividend get us well into the dub digits.

[Oilandgas4ever]

Funny, I had the same math. Do you think they will do the dividend right away or after Q1 or after H1?

[4thefunofit]

Glad to see my Rabbit Hole post got the bullboard goin. Historically speaking Cardinal has been a shareholder friendly dividend paying entity so I'd be shocked if they didn't announce the reinstatement of the dividend w/Q1 on May 12. Heck, by then they could have paid off another 42($MM) of debt if WTI averages $95.  That said, I think TMIC had a good point about front loaded

[ziggy1410]

I got interested in this when Murray Edwards took the large stake...He wouldn't have done this if Management weren't top notch...I still think Murray not in for the long haul but will come up with a good deal for the company/shareholders....But agree with early announcement on dividend.

[JohnnyDoe]

your math looks fine except for your Q1 price for oil. You are using calendar dates, not settlement dates. Q1 settlement dates closed around Feb 20 so Q1 pricing averaged about 80. Q2 pricing is already about 70% complete and is averaging above 100if you go to the bte board, there is a poster called Baystreetwolf. He runs a blog that is bte related but he has all of these stats well laid out. The

[masfortuna]

I would think that in the foreseeable future, oil will be ABOVE that $80 mark ( my daily cals gives me about $81.66 for q1). So anybody interested in the divy should take into account the longterm perspective and not just 1 quarter.

[DowopDowop]

WTI averages.  I posted my math some time back and still come up with  the same Phase 1 target hit date of "slightly before the end of April" hard to tell closer than that using averages. We don't know if their Capital budget is front end loaded because they don't flash it quaterly. They should start to do this btw= better Governance for a company with 1Billion Market

[Re1ndeer2]

Convert to $CDN....?....

[Konaboy]

Yes, first month of Q2 is when we will realize the benefit of the big March price spikes. Q1 will be very nice, Q2 is forming up to be better.