RE:RE:RE:RE:RE:RE:RE:RE:Finally! A day to buy!! EOMI completely agree that the Cascade contract isn't all that transparent and there's been quite a bit of discussion on this board about it in the past. As power pool prices fluctuate, I think that once Cascade is up and running for a few quarters then we'll get a better idea of its impact on Peyto's total revenue.
As for profitability, I will simply say that businesses exist to be successful and, ultimately, to earn a profit. No one starts or maintains a business in order to lose money - unless you're a Crown corporation beholden to (mis)spending taxpayers dollars. Think Ontario Hydro before it was cleaved in two and sold off to investors...and Canada Post. LOL I think profitability is a hallmark of a good business and good business practises. The question then is how sustainable is that profit over the long term. Then you can discuss increasing productivity, innovation, scaling the business, etc. I also wholeheartedly agree that the financial covenants Peyto had prior to 2020 on its credit facility almost did them in during the combined 'oil price war' / depressed NG prices / pandemic - but the hedging did ensure that they remained profitable and I would argue that the 'loss' they posted that year was more to do with the impairment of their assets as a result of those depressed commodity prices. Thankfully, things turned out well and, in hindsight, I'll be kicking myself for not investing more into the company when prices were down in the dollar range. In terms of FCF, Peyto is close to that limit with its dividend as is. Ideally, I'd prefer that any excess FCF be devoted to decreasing debt, thereby having the knock on effect of decreasing interest payments, which can lead to - hopefully - greater shareholder returns in the long term via share buybacks, increased dividends, and/or production expansion (assuming commodity prices support such a move) down the line.
Anyways, just my two cents worth.
MP