Post by
MLEWICKIMBA on Jul 29, 2022 10:15am
Not Worried About ATH
1. Royalties are part of the agreement they entered I believe previously when they needed to and government payments. Yes?
2. A New 2023 Hedging Strategy is something that will enhance their FCF in 2023.
3. $131 USD paid against debt as we know which is 75% of the 175M USD debt repayment goal for 2022 and H1 2023 -- expect this to be achieved in 2022 -- as only $43.75 USD remaining.
4. Tax loss Carry forwards make up for some of the challenges they have right now.
What's the conclusion.
A, Each debt payment is a direct equity increase in the market cap of the firm. So keep those debt repayments coming.
B. In 2023 their hedging losses per BPD will go down my guess by $8.00 a barrel. As a comparison Gear Energy had less than $1.00 hedging adjustment per BPD in Q2 2022. Expect ATH to be able to directly return this money to common shareholders.
C. Expect 200M Cad in 2023 paid directly to common shareholders via buybacks as they mention they prefer buybacks in their presentation.
D. I hope they do buybacks and reduce their debt to less than $100M next year as the interest payments reduce and again this is a direct share appreciation relationship.
Hold this stock.
Good luck.
Comment by
ComradeKomissar on Jul 29, 2022 12:05pm
1. Royalties are part of the agreement they entered I believe previously when they needed to and government payments. Yes? No. They don't pay any royalties to the government of Alberta. Their assets are pre-payout until 2028 at least. They pay royalties to Burgess Energy, who gave them $450M so they could buy their best asset: Leismer.
Comment by
MLEWICKIMBA on Jul 29, 2022 4:59pm
Ok - do you know the duration of the Burgess Energy royalties? Thanks.
Comment by
ManitobaCanuck on Jul 29, 2022 5:18pm
It is lifetime but and built into the asset as mineral rights .