95% utilization in Q4 but profit is only RM18.5m. This is not a small company. Billion units of share issued here. That profit also include investment income of RM6.5m which is not from operation. Next interesting thing to wait is how sensitive their profit is to the fluctuation in interest rate. This will be reported in the audited accounts.
So how? Where is the much hyped dividend? Maybe you will get some "dividend" by attending the AGM.
Seriously, if the drilling industry is really turning up, uwmog should take the opportunity to add more rigs when the price is still cheap just like how investor average down their investment cost. I am sure PNB can provide that financial support.
【UMWOG】 king is about to return! Many people explained so I will not say much, just say a few key points
1) turnover of 190 million, the highest since 2016, the 97% turnover from the drilling rig, the utilization rate of 90% or more
2) The actual net profit after deducting impairment is about 27mil. Although this score is not half of the peak in 2014, it is also worth encouraging!
3) At present, there are about 450 million short-term debt left, long-term debt is about 1.4 billion, about 1.6 billion less than the 3.4 billion in the previous quarter, mainly due to the repayment of the additional shares (the debt is denominated in U.S. dollars) because The strong dollar is a good thing for her, and vice versa is not good, the company holding 600 million in cash
The company pulled out the pulled shit out, the utilization rate is expected to reach 90% this year, the fiscal year 2018 to achieve profitable, all-round earning a small 100 million should not be a problem!
Do not wait until the company profit to buy, because the stock price has been high, to take advantage of now!
For the current very large amount of loss more than RM1 billion and take into consideration with about RM450 million short-term debt and long-term debt is about RM1.4 billion, action must be taken for now is RUN AWAY from this stock or you will be blooded investor.
Secondly,Brent oil price might going up to 80-100 US per barrel any time by these year! So please analysis it for short term & long term on these counter!
impairment loss did come as promised. Right now, Umwog cap is 2.7B but PNB has pump in 2.1B So is PNB going to let umwog sink down further......not good for their portfolio.
shale Oil is at the back end of the biz. which means OPec takes the money first then only comes shale. Once Opec sell down to 50, shale kaput. Yesterday, Trump hit China with aluminium foil tariff 106%, next day China will hit Shale oil import at 106%-----all the super oil tanker will be parking at North Port, Malaysia.
My remisier said alot surprise order comes in to support. Don't be surprised, price may touch 0.330 to show who has the power to support. I saw this during MAS second Crashed. I prepare huge margin for 30% down within first half hour------didn't even fall below 5% from previous price
JJchan, just ask yourself why the oil price dropped and whether the reason causing that drop is still around or not. If yes, what makes you think the price will go up again. Simple as that.
UMW Oil & Gas - 4Q17 Outperformed Author: HLInvest | Publish date: Wed, 28 Feb 2018, 09:29 AM
Results Above expectations: 4Q17 core profit came in at RM25.1m, bringing FY17 core loss to RM129.3m, lower than HLIB’s and consensus losses of RM158.1m and RM167.8m respectively. We have excluded RM2.6m net gain on derivatives, RM982.1m impairment on assets, RM12.2m net FOREX loss and RM16.3m non-recurring expenses.
Deviations Higher than expected rig utilisation.
Dividend None
Highlights YoY: Core profit of RM25.1m was posted against core loss of RM127.7m due to 7 working rigs in 4Q17 vs 2 working rig in 4Q16. QoQ: Core profit surged due to higher average asset utilisation rate of 95% (vs. 90% in 3Q17).
FY17: Core losses narrowed significantly to RM129.3m against RM428.1m in FY16 due to significantly higher rig utilisation (FY17: 70% vs. FY16: 21%) with the commencement of new rig contracts during the year.
According to Petronas Activity Outlook 2018-2020 report, about 7-10 jack-up rigs are required by Petronas Group of Companies and other Petroleum Arrangement Contractors (PACs). This is positive for UMWOG as being one of the only two local players in the industry, the company stands a fairly good chance to secure sufficient amount of contracts to replenish its order book.
Risks Global recession hitting O&G price; High asset cash cost; Petronas’ further CAPEX and OPEX cut.
Forecasts Our FY18 loss projections are reduced to RM55m we changed our FY19 forecast to core net profit of RM16m from core loss to reflect higher expected rig utilisation rates. Rating BUY ↑ , TP: RM0.44 ↑
Following latest outstanding quarterly result, we opined that earnings outlook of the company improved significantly and UMWOG is a major beneficiary of steady jack-up rig demand by Petronas Group given its role as the largest domestic jack- up rig owner. Moreover, recent share price correction has made the valuation of the stock more attractive . Valuation Upgrade to BUY with higher TP of RM0.44 (from RM0.40) based on FY18 PBV multiple of 0.8x post earnings forecast adjustment.
Source: Hong Leong Investment Bank Research - 28 Feb 2018
Another odd finding is impairment for FY17 is higher at RM982k compared to FY16 of RM780k. Come on, FY17 was a better year compared to FY16. We all expected an impairment but a higher impairment? Even Bumi Armada has a lower impairment. Seriously, there is a gross misrepresentation of financial statement here by taking advantage of judgmental accounting treatment. I am sure a lot of retailers got conned into this counter by comparing the share price and the NAV last year, thought it was undervalued.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
offshore
327 posts
Posted by offshore > 2018-02-28 00:39 | Report Abuse
95% utilization in Q4 but profit is only RM18.5m. This is not a small company. Billion units of share issued here. That profit also include investment income of RM6.5m which is not from operation. Next interesting thing to wait is how sensitive their profit is to the fluctuation in interest rate. This will be reported in the audited accounts.
So how? Where is the much hyped dividend? Maybe you will get some "dividend" by attending the AGM.
Seriously, if the drilling industry is really turning up, uwmog should take the opportunity to add more rigs when the price is still cheap just like how investor average down their investment cost. I am sure PNB can provide that financial support.