Q4 + Year End delivered 10 minutes ( ARX is a Dog )CFO is and Accountant and not a real Financial Person
Most pathetic approach to running a business I have ever seen; you have an accountant masquerading as a CFO. The company does not realize by the destruction of the top line Free Funds Flow, the have destroy share holder opportunity in bottom line return.
This fiscal plan is so offside and does not provide investor and reasonable risk reward opportunity. If they just want to do nothing, while that is much what this plan does.
They have fixed the dividend and the amount of dividend to be calculated at the current production based on returns at (55 WTI and $2.50 AECO) 280 million a year.
This provides no dividend upside based on Commodity prices.
· The dividend is tied to increased in production. (2022 no production increase)
· The dividend is tied to the reduction in share count (2022 reduce 5% of shares roughly)
All the extra cash goes to the balance sheet, debt repurchases, and share buybacks, and Pet Project capex. The company claims they will be balance centric. It’s a bottom line saving the pennies is the priority well all the significant gains are not realized.
2023 Dividend
2023 – Projects (40 +2 cents) = 42 cents 2023 (5% based on share buyback)
So that is what the dividend will be at the next annual review, they will raise it 5% in line with the share 5% buyback as production is projected to remain flat. (350,000) boe/ay
Lack of Compelling Investment Thesis
Manage does not have a compelling investment opportunity here, there is no balance between risk and reward, it all balance sheet centric.
In fact, if that was management objective to make ARX a poor investment they have accomplish it with flying colors.
Management should resign this the worst plan I have ever seen. Coupled with poor execution.
IMHO