News release When I saw this mornings release I thought it was okay. The shares opened lower but have recovered. Malcy's blog post captures my thoughts.
Londoner7
Ithaca Energy
Ithaca has released an operational update and 2016 outlook brimming with exciting production estimates and cost reductions. Unfortunately for what is undoubtedly one of the best companies in the sector, investors only had eyes for Stella, in this case another delay, this time of 6-12 weeks, clearly warming Petrofac’s wallet has not been enough but at least they wont have to pay it…
With production from Stella now a 2nd half affair the market appear to be concerned that targets will not be hit but the company have given guidance of 25/- b/d for 2016, at some stage one presumes. The Vorlich acquisition seems like common sense adding proven and probable barrels of 20-30m and good value barrels they will be. The deal also shows that the company are in a strong position to take advantage of any opportunities that the weak oil price turns up. Ithaca remains one of the strongest players in an extremely difficult market, the balance sheet is ok and with the hedging process is even cash generating, barring accidents it is still the poster boy of the sector.