It is good to be in Oil at the moment. Here is a way in which you can exploit the oil bonanza in an indirect way. Hunting PLC is an international Oil Service company providing various service solutions to some of the world's largest Oil and Gas operators.
Having been through a tough 2001-2002, things seem to be on the up with the market Hunting operates in being bouyant.

The latest results were good:
Turnover 1,195m (2002: 951m) +25.6%
Total operating profit 25.2m (2002: 24.4m) +3.3%
Pre-tax profit 21.1m (2002: 19.1m) +10.5%
Basic earnings per share 6.4p per share (2002: 4.1p) +56.1%
Ordinary dividend per share 3.50p (2002: 3.0p) +16.7%

Oil and gas prices are sky high so expect a drilling bonanza. Hunting is well placed globally, and especially for Canada’s tar sands.

Vital stats:
Market value: 129m
Historic PE: 20
Prospective PE for 2004: 11
Prospective PE for 2005: 10
Dividend yield: 2.75%
NMS: 5,000
Spread: 3.8%

Solid trading statement released a couple of weeks ago.

This week disposed some loss-making assets that generated $45m.

The chart is enticing.

The stock is demonstrating good strength with the price now moving into a gap from 1.25 to 1.70 and then quickly to 2. This was the fall in June/July 2002 which came after the market realised Hunting was to be hit with the then decline in international oil exploration and drilling activity.

Things are now very different however and the price could move ahead very quickly from here.

Hunting has not been getting much press, but is a great way to play the recent surge in the Oil/Gas sector.

Seems stuck in this range 460-480p.

For Immediate Release
5 September 2016



Hunting PLC

("Hunting" or "the Company" or "the Group")

Interim Results for the six months to 30 June 2016

Hunting PLC (LSE:HTG), the international energy services group, today announces its interim results for the six months to 30 June 2016.

Financial Summary - from continuing operations

· Revenue $228.4m (H1 2015 - $463.6m)

· Underlying EBITDA $29.5m loss (H1 2015 - $44.1m profit)

· Underlying loss from operations of $50.8m (H1 2015 - $20.4m profit)

· Reported loss from operations of $77.0m (H1 2015 - $63.1m loss)

· Underlying diluted loss per share 27.8 cents (H1 2015 - 8.4 cents earnings per share)

· Reported diluted loss per share 40.3 cents (H1 2015 - 35.5 cents loss per share)

· Net debt of $87.5m (31 December 2015 - $110.5m)


Operational Summary

· Focus on cash generation to reduce net debt, with initiatives including:
o $42.3m reduction in inventories since 31 December 2015;
o $29.5m tax reclaimed from carry back of losses; and
o capital investment limited to contracted or essential spend.

· Cost cutting measures continued during the reporting period and include:
o 46% reduction in headcount to 2,145 since 31 December 2014 position of 4,003; and
o 3 manufacturing facilities and 7 distribution centres closed.

· Discussions to revise terms of bank Revolving Credit Facility concluded:
o profits based covenants suspended until the 31 December 2018 test date;
o new asset based covenants of Tangible Net Worth and Asset Cover;
o facility size reduced from $350m to $200m;
o facility secured on trade receivables, inventory and property in the USA, UK and Canada; and
o no dividend payments until the end of the amendment period.

Commenting on the results Dennis Proctor, Chief Executive, said:

"While industry sentiment reached a low point during the early months of the reporting period, the improved US rig count data seen through Q2 indicates that the global energy markets are adjusting to the lower oil price environment. The combination of lower operating costs and production efficiency gains has led to increased enquiry levels as operators focus on those projects which provide the strongest returns. However, given the inherent uncertainty within the industry at this time, the current market estimates for the 2016 full year will remain dependent on an improved trading environment in the latter part of the year.

"While the Group's performance has suffered, we are pleased to have concluded the renegotiation of our bank covenants to enable Hunting to continue with strong, liquid resources to respond to an improving market environment. At the period end our net debt position has been reduced to $87.5m following ongoing cost cutting and the receipt of tax refunds, which indicates the strength of our balance sheet and the resilience of our business model."
LATEST BROKER VIEWS

Date Broker New target Recomm.
5 Sep Liberum Capital 305.00 Sell
1 Sep Deutsche Bank 560.00 Buy
24 Aug Barclays... 500.00 Equal weight
19 Aug Deutsche Bank 560.00 Buy
12 Aug Goldman Sachs 654.90 Buy
22 Jul Deutsche Bank 560.00 Buy
22 Jul Barclays... 500.00 Equal weight
11 Jul Deutsche Bank 560.00 Buy
3 Jun Goldman Sachs N/A Buy
13 May Liberum Capital 240.00 Sell

Credit Suisse note today:
Upgrade to Outperform. With greater exposure to well completions (mostly because of Titan) and US unconventionals, HTG should have more operational leverage to this recovery cycle than 2009. The recent improvement in orders suggests customers have consumed excess inventories of certain product lines. Rig count (up more than 50% from the bottom across major basins) and DUC completion trends add substance to this thesis, while a Trump Administration should also be a boon to the US Oil & Gas Industry. All this suggests a brighter outlook for HTG.
Patience required. Many HTG customers may need to fill their own plants / facilities before sourcing product from HTG. The competitive environment has intensified recently, while burning through higher-cost inventory may also hamper margin expansion initially in the recovery phase. HTG’s business outside NAM may also be a drag through 2017, notably offshore markets in the North Sea and Asia Pacific. One should therefore expect HTG’s recovery to lag that of its mainstream customer base.
Strengthened balance sheet: HTG had made solid progress reducing net working capital and net debt through the downturn. The successful placing in late October raised over GBP70m (~USD87.5m) of gross proceeds, which effectively eliminates group net debt. This enables HTG to better respond to growing business development opportunities while providing even greater headroom to banking covenants. It also removes a barrier to HTG potentially participating in industry consolidation.
Valuation: We increase 2017/18E revenues / EBITDA by 2%/2% and 4%/8% respectively, although the EPS impact is muted by the placing. Putting our forecasts in context, 2018E EBITDA is ~60% below the 2014 peak, but we are 15% above the street, and see an EV/EBITDA multiple of 8x, which is materially below peers in the 9-14x range. We utilise higher peer group multiples in our SOTP valuation, and, in aggregate, this drives an increase in TP to GBp575p (from GBp500).

Hunting PLC (LSE:HTG), the international energy services group, today announces its results for the year ended 31 December 2016.

Financial Summary - from continuing operations
· Revenue $455.8m (2015 - $810.5m)
· Underlying EBITDA $48.9m loss (2015 - $61.9m profit)
· Underlying loss from operations of $92.2m (2015 - $16.4m profit)
· Reported loss from operations of $140.7m (2015 - $282.2m loss)
· Underlying diluted loss per share 45.3 cents (2015 - 3.1 cents earnings per share)
· Reported diluted loss per share 76.8 cents (2015 - 156.1 cents loss per share)
· Net debt of $1.9m (31 December 2015 - $110.5m)

1 Underlying results are based on continuing operations before amortisation of acquired intangible assets and exceptional items. Reported results are based on the
statutory results for continuing operations as reported under International Financial Reporting Standards as adopted by the EU.

Operational and Financial Summary

·New product lines continue to be developed and rolled out to customers to lower their operational costs and increase project efficiencies including:
o further commercialisation of the H-1 Perforating System, which is now being used by major oil companies in the US;
o broadening of the WEDGE-LOCK™ premium connection family to include 14" and 16" variants for commercialisation in 2017; and
o introduction of the EQUAfrac™ charge, providing uniform hole technology in the wellbore.

·Focus on debt reduction with initiatives including:
o $61.7m reduction in inventories since 31 December 2015;
o $31.3m received in net tax refunds; and
o $17.2m capital investment made in year - limited to contracted or essential spend.

·Cost cutting measures continued during the year and include:
o 24% reduction in headcount to 2,107 since 31 December 2015; and
o 3 manufacturing facilities and 10 distribution centres decommissioned during 2016.

·Borrowing facilities' terms revised:
o profit-based covenants for the committed bank facilities suspended up to and including 30 June 2018 bank covenant test date;
o committed facilities reduced from $350m to $200m;
o drawings under the bank facilities secured on assets;
o capping of annual capital investment; and
o no dividend payments until the end of the suspension period.

·Placing of 14.6m new Ordinary shares raising $83.9m net of transaction expenses completed:
o proceeds used to reduce borrowings and increase financial flexibility; and
o placing price of 485.0 pence per share.

·Facility expansion programme now completed:
o commissioning of Ameriport, US, facility in the year; and
o global operational footprint of 3.1m square feet.


Commenting on the results Dennis Proctor, Chief Executive, said:

"Hunting's 2016 results reflect the difficult market conditions facing the global oil and gas industry caused by the sustained low oil price leading to lower demand for our products and services.

"Towards the end of 2016 optimism was seen across the energy market, following the announcements by OPEC to reduce oil production and improving onshore activity levels in the US, particularly in West Texas. While this is positive news for the industry, Hunting is still focused on cost controls and aligning its operations with the short-term outlook. US onshore activity levels are increasing, providing better trading for businesses such as Hunting Perforating Systems, while the international picture remains subdued."

"For the Group as a whole, operating losses have been incurred during the opening months of 2017, however, management anticipate moving back to monthly profitability later in the year, subject to a continuing recovery across the whole market."