Post by
TouchDown12 on Feb 17, 2022 12:25pm
KELT will be debt free again; surplus at Y/E '22... BUT...
BUT this is at their very conservative budget assumptions.... (all at 1.227 CDN/USD FX which right now is 1.272 CDN/USD; so 5% upside just on FX with a Fed tightening and USD strenght) 72 USD Oil; 4.10 USD NG; AND and they have very good '22 hedges for basic risk management relative to today's NG and Oil/NGL spot and strip prices. The performa on Budget assumptions @+20% (very doable on current FX+Oil/NGL/NG at current prices) works out to +50M bove budget or about .20/share additional AFF. My guess is between some good news on prodction and some good news on pricing that KELT has some really good upside in '22. I was at first a little worried at the sell-off this AM; but now that I had a chance to examine the presentation I can see why S/P is recovering. A lot to like here; not growth at any cost. Shareholder returns could be coming in 2023. Huge insider ownership (+18% of O/S). TD12
Comment by
PabloLafortune on Feb 17, 2022 3:34pm
Btw, as of 12/31, Kelt had purchased and held in inventory $19.3M of tubing and other equipment all of which will be used in the 2022 capex program. I gather they don't normally do this but due to supply chain issues, they did this year. Which means I guess that in normal times they would have finished the year with a $9M working capital deficit, not $28M.
Comment by
TouchDown12 on Feb 17, 2022 4:23pm
Great insight Pablo. TD12