RE:RE:RE:Is a recap coming? Hendricks the issue is that the numbers are almost irrelevant when you look at the actual bottom line impact of their revenues. The accounting shows they are quite profitable but free cash flow is very weak. They do a few things that are different than most companies. For example trucking more than putting in pipelines (under-capitalizing versus over capitalizing lease operating expenses). They insist it is the right way to operate. IPO would be an example of a similar sized company doing it the other way.
most oil companies are measured on cash flow and free cash flow because profits are UNDER stated. Yet cash flow, free cash flow and cash on balance sheets are climbing at most other producers right now but dropping at YGR.
Right now YGR exists at the whim of its lenders. Last year they were required to do a flow through financing to shore up the balance sheet. Idiotically they never hedged anything in the best gas market we had in a decade. Then the lender MADE them hedge 50% into a poor market, thankfully because it got even poorer.
it's pretty tough to do another financing because the last guys just lost 60% in a year. Bad weather made it worse, sure, but the effect is the same.
They just spun their wheels for 18 months. The lenders previously laddered down their credit. No doubt the pressure is still on because debt to cash flow is 1.7x and production has been declining - they have been unable to drill their way out of this mess. They spent 96 million in the Cardium vs 91 million spent by BNE in 2023 - the closest comp in terms of numbers. With very different results.
They need some combination of more cash, better drilling, better land, field optimization and financial management. So yes a recap or a sale before the banks demand some changes.