Investors' Room :: AFREN (AFR) Is this the next TULLOW??? - MoneyAM - Free Share Prices, Stock Quotes, Charts, News, Level2

niceonecyril - 04 Apr 2009 08:30

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Chart.aspx?Provider=EODIntra&Code=AFR&Si

niceonecyril - 20 Jul 2011 09:06 - 1687 of 3666

Highlights

u Reservoir performance at Ebok and Okoro at upper end of expectations

u Average full year daily production revised to 25,000 to 30,000 boepd due to non reservoir related facilities downtime; on track for 50,000 boepd 2011 exit rate

u Strong financial position - first half revenue US$161 million; cash at bank US$320 million and net debt US$344 million

u First half capital expenditure US$254 million, with forecast full year expenditure at US$450 million

u Active exploration programme with nine wells planned targeting over 600 mmboe net to Afren

u Continue to prioritise value accretive acquisitions

Osman Shahenshah, Chief Executive of Afren plc commented:

"During the period, reservoir performance on the Ebok and Okoro fields has come in at the upper end of expectations. While we have revised the 2011 average production guidance, due to non reservoir related facilities downtime and simultaneous operations, we are expecting a 2011 exit rate of 50,000 boepd. Looking forward, we are targeting both organic and inorganic reserves growth, with up to nine exploration wells targeting over 600 million barrels net to Afren in H2 2011 and further value accretive acquisitions."

Will add full RNS to the header.

HARRYCAT - 20 Jul 2011 09:08 - 1688 of 3666

The market seems to agree with you hlyeo. Down 3% at one point this morning.

niceonecyril - 20 Jul 2011 09:16 - 1689 of 3666

Realistic post from someone who'sv/heavily invested in AFR.

hmm, ok, down from target 40,k boepd avg over to 2011 to 25/30k boepd net over 2011.

lets take 27.5k net boepd to afren avg over 2011:

27500bopd * $100/b * 330 up days = $907.5m turnover (40k was ~$1.25/30billion)

say, ~20% of turnover being = to net profit after tax = $181.5m net profits (40k production woudl have been nearing ~$290m/$300m)

eps earnings per share: 986m shs / $181.5m = 18.4cents : at 1.6 ex rate = 11.5p ($290m would have been ~19p eps)

weve always gone on basis of the 2p's (reserves) being worth ~170p or so, and earnings being a driver, but this is not a particularly good bit of news today, its putting us at 115p on ten times earnings, and at 15* earnings = 172.5p (15 times being a bit on the high side imho)

looks like we are a bit more dependant on Keta now, given that weve just taken a significant hit on earnings, and future explo in east africa.,

well done afren. not.

however, 2012 looks now, to be the year for afrenn, as they have basically fked up 2011 on a production basis.

roll on keta etc etc :-)

Balerboy - 20 Jul 2011 09:16 - 1690 of 3666

BUT holding steady....H98's short not doing well.,.

kuzemko - 20 Jul 2011 10:18 - 1691 of 3666

why have they fucked up on production???

kuzemko - 20 Jul 2011 10:28 - 1692 of 3666

TLW- price 1278p market cap $11.38bn shares in issue 890mln. production 58kbpd
DGO- price 535p market cap $2.75 bn shares in issue 511mln. production 55kbpd
AFR- price 147p market cap $1.47bn shares in issue 985mln. production if up to 35kbpd

afren wont stay for long with market cap at $1.47bn!!! afren will trade between 250p-300p by the end of the year. if market are stable, meaning no crashes and recession.
if afr hits 50kbpd it will trade well above 300p.

i like say well done afr.

Chris Carson - 20 Jul 2011 11:33 - 1693 of 3666

If this news was already priced into the market shock horror, then my take would be next six months stuck in a trading range if it can stay above 200DMA. Not jumping back in yet, watching.

cynic - 20 Jul 2011 11:44 - 1694 of 3666

not saying you're wrong, but sp has not fallen below 200 dma since about may 2010, and then it was only briefly ....... with some caveats, this does not look to be a bad time to take at least a modest stake assuming you concur that there is plenty of upside within say the next 12 months

Chris Carson - 20 Jul 2011 12:07 - 1695 of 3666

Cynic - Absolutely, but plenty of scope to trade between 150.0 - 173 if that is the case.

niceonecyril - 20 Jul 2011 12:29 - 1696 of 3666

M/caps are more to do with reserves than production(well life),while AFR have great potential as yet it is still just that?The market is interested in proven(P2)reserves so until such time,we are stuck in the present trend?
aimho

aldwickk - 20 Jul 2011 12:35 - 1697 of 3666

150.60 bid , all going to plan minus a few unexpected minor problems which you would expect with this of type company.

Balerboy - 20 Jul 2011 13:09 - 1698 of 3666

Keeping mine........

jimmy b - 20 Jul 2011 14:42 - 1699 of 3666

Me too.:)

maggiebt4 - 20 Jul 2011 15:50 - 1700 of 3666

and me too.

halifax - 20 Jul 2011 16:00 - 1701 of 3666

sp has been range bound since january today's RNS does not encourage a move upwards.

jimmy b - 20 Jul 2011 17:05 - 1702 of 3666

Afren (AFR LN) HOLD
TP: 155, SP: 150p, Mkt cap: 1,477m
Trading statement: 2011 expected production target cut by 25%-plus
Afren has cut its forecast for 2011 production from 40,000 boed to 25-30,000 boed due to non-reservoir related problems. The mature Okoro field has suffered due to debottlenecking and concomitant production suspension, while the Ebok field production rates have been impacted by the late start up and a slew of development problems/delays, which the company says are not reservoir related.
These are the two key value elements for the company. Provided production can get back on track for 2012 (exit 2011 is expected to be 50,000 boed), then there should be only a small impact on our valuation. However, the scale of the miss‟ for 2011 does raise questions about the achievability of the original forecast, which was confirmed only two months ago.
Afren does have an enticing exploration drilling campaign, centred on the delayed Keta well in Ghana and East African drilling (Tanzania and Kenya). Much of this looks to be in Q4, and we would not be surprised to see some of it slip to 2012. For now, then, we maintain our HOLD rating, but we would expect to see a negative market reaction to the 2011 production forecast.
Charlie Sharp
+44 20 3206 7180
charlie.sharp@matrixgroup.co.uk

Not great ,but i'm looking at next year ,this is still a hold for me.

Balerboy - 20 Jul 2011 22:08 - 1703 of 3666

I reckon no 140p hombre.,.

aldwickk - 21 Jul 2011 08:51 - 1704 of 3666

Dougie Youngson, analyst at Arbuthnot, says Afrens (LON:AFR) production down grade is not surprising given that Ebok, where there was a delay in start-up during first half, is in that tricky tinkering phase which all fields have at the beginning.

Youngson continues to rate Afren a strong buy, with a target price of 209p.

He says key reasons to plump for Afren include strong production growth; a healthy pipeline of potential acquisitions (which he expects to see action on during the 2011 year); and an East African exploration portfolio that has huge upside potential.

Youngson expects the market to focus on the production downgrade today. But he is sticking to his guns: Afren continues to be our top pick on the main board. It has a strong long term investment case, with a major uplift in production this year, acquisition growth and potentially some interesting exploration in East Africa.

hlyeo98 - 21 Jul 2011 09:02 - 1705 of 3666

Chart trend is showing a downtrend... soon it will be below 140p

aldwickk - 21 Jul 2011 09:15 - 1706 of 3666

your reading it up side down

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AFREN (AFR) Is this the next TULLOW??? (AFR)