RE:RE:RE:So…is the new acquisition negative accretion yet?VeritasVern wrote: Kherson wrote: Baystboy07 wrote: Starting to wonder if the Board will approve the dividend increase now that the acquisition is probably negative accretion to EPS. I hope they do not.
It seriously keeps pi$ing me off that the management team is one giant FU&KUP.
PAY DOWN YOUR FUC&ING DEBT...INSTITUTE A NCIB...STOP BUYING ASSETS TO RAISE THE DIVIDEND TO LINE YOUR POCKETS
ITS NOT THAT FUC&ING HARD YOU IDIOTS!!!!!
Pretty obvious that the proposed dividend increase is now off of the table. In fact, Paul's proposed dividend increase from his November 2nd NR was never a viable option when announced simply because Surge has way too much debt!
Kherson
At $70 oil is most likely off the table, but it is too early to say based on just the last week of trading alone. If oil runs up again to $80 and closer to $90 it's still an option. I'm thinking the cap on Russian oil will not have only positive outcomes for the G7 but some of the negative consequences for reduced supplies globally as well. Perhaps we will see $80+ oil in early Jan but the biggest risk to oil is recession related and volitility.
The BOD actually meets this week and they should be making their next dividend announcement on the 15th, so your reasoning of future higher oil prices providing the FCF to boost the dividend are complete foolishness.
Sadly, with the present oil price, coupled with Surge's huge debt, Surge can no longer maintain the present dividend in a sustainable manner. On top of that, the acquisition will no longer be accretive to the bottom line.
The smart thing here is for Surge to cut the dividend until their debt is eliminated.
Kherson
P.S. Let's not forget that the new $100 million amortizing term loan that the banks are providing for the acquisition will force them to pressure Surge to eliminate the dividend and since the closing date is December 19th, their opinion will sway the decision of the BOD.