Birchcliff Energy Ltd T.BIR

Here are the real numbers, re: Upcoming Div announcement

[Billybabin61]

Their guidance as presented is for a sustained .20 per Q dividend based on reduced commodity pricing environment as we are in now. This bottom line translates to a 2023 projected adjusted funds flow of $468mil.

To achieve this they need:

an average AECO price of CDN$3.00/GJ, an average Dawn price of US$3.20/MMBtu, an average NYMEX HH price of US$3.40/MMBtu, and an average WTI price of US$70.00/bbl

You can make your own judgements on where commodity prices will be,but this is what it is.

[Burgersandfries]

They may need that and that's great but if that happens the stock price will definitely drop and then the market won't like the big dividend. I hope like another poster said that they re think the big dividend for now to something more normal and grow it slowly as the market allows or do a special dividend like  they just did and TOU does.

[HighOctane89]

Why do you say the stock price would drop with a 20 cent/Q divy B-and-F ? If Tonkin follows through with what the plan layed out , at this price thats a 10% dividend . I have been watching to see if the MM gives a hint of the impending announcement but then again , this market is running on fear so who knows where this all ends up .

[Burgersandfries]

Hey HO if gas drops to $3.00 dollars regardless of the dividend  the stock will drop, maybe I wasn't clear. History show's investors get nervous when dividends are perceived to high which would also put pressure on the stock. The market would become fearful of a cut in the dividend. Yes Jeff says they can afford it if gas goes to $3.00 and I'm sure they can but sentiment in my

[HighOctane89]

Thanks for the clarification and you may very well be right since fear is the only factor being considered in recent trading . I'll keep watching for a signal that news is pending , its safer on the sidelines right now .

[PlutusofCrete]

There is only concern when a company pays a high dividend and has high debt.  This would be the case for companies like Chemtrade or Peyto.  BIR is in a unique position. No debt all dividend.  Someone will buy BIR - probably TOU.  

[AlwaysLong683]

I agree. Most smaller O&G E&P companies should pay a very modest but consistent dividend, then consider offering a one-time "special" dividend on occasion should their financial situtation and outlook justify it. When will these firms learn that they are in a volatile business where prices can change rapidly and for prolonged periods of time, hedges can help but are not a cure

[Billybabin61]

Obviously if a company pays out more dividends than it earns the dividend will die. Right now  they are paying out a little more than 10% of their free cash flow which is very low.(that is excluding the special div in Oct.) Keeping in mind that CNQ and BIR are in two different weight classes for a lack of a better term, CNQ pays out about 28% of  their FCF to their dividend. The CNQ

[AlwaysLong683]

In my view, that's rear-view mirror investing. Those FCF numbers and payout ratios are all trailing figures. True, debt repayment was smart and cuts down on the size of interest payments, but BIR has no control over future natural gas prices and no hedges (plus the possibility of surprise shocks to natural gas prices via world events), so the FCF, payout ratio, etc. numbers will be

[Billybabin61]

The numbers I have used for BIR are from their 2023 guidance, so if you consider this to be trailing figures, I guess that you must have another system far superior. Please feel free to share and contradict BIR's management figures. These numbers provide vsibility for commodity weakness and vulnereabilities to their guidance. No company has control over commodity prices but they do have

[Donhow]

If they keep the dividend at .02 with nat gas at 3.00 and 70 oil they will have about half a billion dollars cash by Dec 2023. That would guarantee both windfall taxes and a buyout at sub $10 share price. Why wouldn't TOU buy them for $2.6 billion if they can get $.5 billion cash  and sustainable 75000 bbls a day for 25 years? Btw the buybacks only buyback the shares they issue each year.

[robert41]

For sure the buybacks last year basically covered options they were given which is annoying I think the options granted in 2022 were around $9.50 a share so maybe it might take a while to get those exercised. The 2 cent divi every quarter is ridiculous either raise it to a reasonable amount or eliminate it. I agree Build a mountain of cash and decide what to do with it when you can see some