Headlines
• In Brief:
Sound Energy (LON:SOU – 17p) – Building Sustainability
Ophir Energy (LON:OPHR – 86p) – Cash (Flow) is King
Lansdowne Oil and Gas (LON:LOGP – 2.13p) – Extension to Loan Note
In Brief
• Sound Energy (LON:SOU – 17p) – Building Sustainability: The Company’s consolidation of its interests in Morocco demonstrates management’s focus on growth of its portfolio without excessive risk to its shareholder base, and while at one time this approach would have been frowned upon, we believe that in conducting its growth strategy in such a manner it is ensuring that it is in as strong a position as possible for the future, which if there is a predator to come, means that they will have to pay a full valuation for the stock. We believe that investors will be pleased with the way that the Company is growing, and more specifically, that it is being conducted in such a measured manner.
• Ophir Energy (LON:OPHR – 86p) – Cash (Flow) is King: It is somewhat boring that we keep repeating this mantra, but all growth companies, irrespective of size, need cash to fuel their growth. In this respect, Ophir’s shift in focus from the its longer term programmes to nearer term cash generative programmes is paying dividends, and with a healthy cash balance, which wouldn’t have been healthy if they hadn’t made that shift in focus, the Company is in a strong position. While we couldn’t rule out further equity raises and some point in the future, given the range and ambition of the Company’s future programme, at least now they will be at the Company’s election, and not due to Ophir’s management team having to react to events. All in all, we believe that investors should be happy with how the company has manoeuvred itself over the last 12 months, and for what that process says about their management team.
• Lansdowne Oil and Gas (LON:LOGP – 2.13p) – Extension to Loan Note: Today’s announcement that the Company has been successful in extending its loan note is good for the equity investors, as it provides the Company with space to undertake a restructuring, which if successful, places it in a prime position to maximise fully on its exposure to the Barryroe field.