Athabasca Oil Corp T.ATH

Key Takeaway - Debt!

[Kika2016]

The Company intends to remain nimble and creative in accessing the credit capital markets which could include a combination of term debt and bank debt to optimize its current capital structure. The Company’s goals include providing multi-year funding certainty and lowering the overall quantum and cost of debt.

[littledave55555]

i understand what your say about the debt... we will see tomorrow what people think at the open .. I hope they find what they are looking for lol because i enjoy this company ... 

[Chris007]

lol...so basically no resolution as of yet on the debt issue....thats disappointing Waiting for them to post the actual financials on sedar. They still aren't up yet.

[Mindset]

Pretty disappointing they didn't refinance the debt. I have to believe they didn't have an option. Oil market has improved, but waiting for a "better deal" seems foolish. Saving a couple points of interest is pointless. 

[Chris007]

Interest rates aren't going to go any lower, than they are already at right now...if you believe that the economy is going to rebound in a hurry following vaccines, rates will continue to trend upwards. You really can't have it both ways. Hell, yields in the bond market are already picking up due to inflation expectations.

[mlcb2525]

Ideally, I would have liked to have seen an announcement of a debt rollover. However, these things often do not neatly line up with the release timing of financial results. On the positive side, the language used regarding the financing to me at least, is much stronger than what was used in prior MD&A's and I think they are close to getting something done. Of course the fact that it is

[fellowship]

The second lien debt will be refinanced at lower rates ( and now copy and paste) combination of term debt and bank debt (..) multi-year funding certainty with the goal of lowering the overall quantum and cost of debt. If you can see through this you will do just great, if you don't ..ohh well you tried. 

[Chris007]

My point is, they have been saying that it WILL be refinanced since last year...alot or people on this message board for whatever reason were hoping that the news of the refinancing would definitely come with the year end earnings....it didn't At 60+ WTI, I don't really forsee them having big issues rolling the debt. That being said, credit market conditions aren't going to get any

[Mtklip]

I think when the stimulus gets passed, the rates are going to go lower.

[Chris007]

If stimulus gets passed, rates are going higher...you're just pouring rocket fuel on a already frothy market

[Mindset]

Good chance the stimulus will be less than the market is anticipating. Therefore I believe also that rates will fall. Even if stimulus is at the 1.9t, it'll be a sell the news event. 

[fellowship]

The rates will be stable. At least for 2-5 years. You read this first here. 

[Chris007]

It'll largely depend on how agressive the fed will be in trying to fight rising yields. It will also greatly depend if inflationary pressures really start showing up in the data due to the sea of money currently sloshing around from all the monetary and fiscal stimulus we have seen thus far.

[fellowship]

Yes, as consequence the FED balance sheet will continue to expand.  ATH is now changing from a zombie company to a succesful money making machine.

[Mindset]

Historically after a 100bps increase US bonds returns were positive over the next 12mos or so. Going off of my fuzzy memory. I think there were 5 events in the last 20years. 

[Chris007]

Indeed, but then again, we have never in history seen this much fiscal and monetary stimulus implemented, not only on the part of the US government, but basically every single country in th developed world.

[Mtklip]

I understand, but oil, like other commodities is expected to be affected by inflation too. That is one of the factors why the oil trade is looking bullish.

[fellowship]

Agreed. But also from the policy point oil will become scarce commodity to influence population consumption and the green new deal coming to fruition. 

[Chris007]

There is indeed a positive correlation between commodities and inflation. However, rising interest rates very much do have a negatve effect on commodities. Generally for storable commodities, (1) rising interest rates incentivize producers to produce more in the near term, than in the future (therefore increasing supply) (2) it also makes it more expensive for firms to carry inventory (3) it

[Mtklip]

But interest rates rise in response to rising inflation as a taming mechanism. This leads to a slowing of economic activity, I agree, but I have heard multiple analysts citing potential inflation as one of the catalysts for rising oil prices.

[fellowship]

We are invested in petrodollar system. History repeating itself.   https://en.wikipedia.org/wiki/Petrodollar_recycling  The surpluses could not be efficiently invested in their own economies, due to small populations or being at early stages of industrialization; but the surpluses could be usefully invested in other nations, or spent on imports such as consumer products

[Mtklip]

I mean the fed will step in and lower the rates if they go higher.

[Franklin80]

without refinaced the debt, it is very difficult to say how will happen tomorrow, i guess so many people expected ATH already refianced it. GLTA