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BPT - Beach Energy

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Well, I hope you're right, ShareDevil.
I've held BPT longer than I care to remember on the presumption that better performance was just around the corner.
I'm now coming to the conclusion that the 1 billion plus shares on issue are too much of a handicap for this company to out-perform.
 

OK it's now time to take another look at BPT in my opinion.

Too much has changed for the positive to warrant it staying at such a cheap price for too much longer.

It is now 100% deb't free and has no oil hedging in place to limit it getting high prices so the sky is the limit now.

With a yearly profit of over 200 million this is way too cheap.

200x P/E of 10 = 2 billion ( market cap)

Current market cap= 815 mill

Undervalued?? I say!
 

Where do you get $200m from?

Based on last quarterly no free cash flow, in fact were burning cash at a huge rate

If it smells like a dog, wags its tail like a dog and barks, it is a dog
 
I'd be a bit careful about a "yearly profit of $200m".

This will include the abnormal profit from the sale of Tipton West to AOE - at a price incidentally which didn't compare too favourably with other Qld CSM deals.

A more realistic profit base would be last year's normalised NPAT of $52.7m, around 5cps.
 
Alternatively, DLS is trading at a slight discount to the current BPT SP. considering BPT might better the current take over offer to DLS. So it may be cheaper to enter BPT via DLS...
 
BPT pisses me off no end. They paid some stupid dividend of 4 cents. The cheques, bank charges, stamp duty and postage could have costed them a good part of the total dividend payout. So why can't they excercise some common sense and not declare a dividend, save so money and not add insult to injury to the small shareholders.
 

Oldblue,

52 Million is what they had already achieved in normalised NPAT by December 2008 and you think that in the last 6 months they have only gained an additional .7 million???

You had better take another look at the half yearly report again (page 6)

Based on those figures BPT will have at least 100 million profit for the financial year ending June 2009. NPAT should be far better than that for the new financial year that we are in now.

I have also calculated that the company will now be saving $51,780,000 in interest payments for the 650 million in borrowings that they have now paid back.

It's all icing on the cake.
 
gooner said:
Where do you get $200m from?

Based on last quarterly no free cash flow, in fact were burning cash at a huge rate

If it smells like a dog, wags its tail like a dog and barks, it is a dog
Click to expand...

Gooner how do you think that BPT paid back the debt if they had such a bad cash flow???

They also have over 125 million in the bank. How many companies can boast of being debt free with money in the bank like that???
 

No, champ, I'm working off the 2008 result which was a NPAT of $63.7m, normalised ( by the company) after $50m hedge close out - which was a real cash cost by the way - and asset sales of $64m, plus or minus a few smaller amounts, to a "Normalised NPAT" of $52.7m.

Asset sales will be the big driver of this year's NPAT again and interest savings will certainly show up in the future but I'm more interested in their production ( last year 9.3 mmboe) and their 2P figure which has been reduced by around 60% by the sale of Tipton West.

As a long term sufferer - sorry, shareholder - I would like nothing more than for the Beach to turn up trumps.

 

I'd love to receive "some stupid dividend of 4 cents " from BPT.

The latest two divvys have been one cent and three quarters of one cent, ie one and three quarters cents in the latest twelve months.

 

Oldblue,

Tipton West didn't make up 60% of BPT so I can't see 60% disappearing.

By the way there was no sale for BPT to fudge any profit for the first 6 months to Dec 08 and they still had a profit of 52 million so yes, they should be able to attain at least a 100 million profit for June 2009.

If people can't see value in a company that has a very decent profit in a debt free company with many solid projects in place for growth then that is their loss.
 

Hi again Oldblue,

According to the latest preso BPT have around 270 mmboe in reserves now. They previously had 76 mmboe on top of that prior to the sale of Tipton.

Cheers!
 
champ2003 said:
Hi again Oldblue,

According to the latest preso BPT have around 270 mmboe in reserves now. They previously had 76 mmboe on top of that prior to the sale of Tipton.

Cheers!
Click to expand...

Actually 270 mmboe is what they are aiming at achieving so they don't have that at the moment . I think that it's just under 70mmboe.
 

As at the latest company presentation, but before the sale of Tipton West, Surat Gas 2P reserves ( Tipton West) were 79.1mmboe or 54.9% of total 2P reserves. So, not 60%, only 54.9%!

Don't go confusing the Cooper oil and gas contingent resource of 262mmboe with 2P reserves. They are beasts of a very different colour!

The "normalised profit" of $52.7m that I refer to is for the latest year to 30 June 2008, not the half year. What I'm interested in is the normalised profit for the June 2009 year, after stripping out asset sales, and what the actual production has been. We can be certain that 2P reserves are going to be roughly 54.9% lower than the previous year unless they have been able to do some quick conversion of that contingent resource.
 

Oldblue,

That does make sense however I'm more interested in the profit that they will get. It's all good and well to have the 2p reserves but how cost effective are they in getting it out of the ground?

For me to determine what the share price will be I always look to profit first and then I go from there. If BPT can duplicate their half yearly profit then that will be a great result IMO.

I'm guessing that they will come out with something alot higher than 100 million although anything over 100 million will probably consist of the Tipton West sale so I wouldn't be factoring that in for my target price.
 
champ2003 said:
Gooner how do you think that BPT paid back the debt if they had such a bad cash flow???

They also have over 125 million in the bank. How many companies can boast of being debt free with money in the bank like that???
Click to expand...

How did they pay back the debt - assets sales, but selling off the silver is not sustainable.

March quarterly, section 5 shows a reduction of cash from $139m at end of December to $29m at end of March, a cash burn of $110m So by now would have run out of cash but for Tipton sale. Cash is king at the moment, so no wonder it has been sold down.

I hold BPT oppies only.
 
Hi gooner.

I hold a few BPT oppies as well.
Must admit I'd forgotten all about them. The exercise price is around $2 from memory and they expire in less than twelve months now, so I'm not expecting to make my fortune there!

 
oldblue said:
Hi gooner.

I hold a few BPT oppies as well.
Must admit I'd forgotten all about them. The exercise price is around $2 from memory and they expire in less than twelve months now, so I'm not expecting to make my fortune there!

Click to expand...

oldblue

Same with me - own about $100 dollars worth - hardly seemed worth the brokerage of $30 to get rid of them..............
 
I have been looking alot closer at beach petroleum latly, and have spent I bit of time thinking about things.

I have come to the conclusion that at it's current price it is one of the best natural gas plays on the east coast.

I am really confident that domestic natural gas usage on the the east coast of australia is going to rise quite sharply over the next 10 years. And with beachs production being somthing like 90% Gas, the increase in volumes and prices will have a very positive impact on beach.

I am also confident in global natural gas prices and with several LNG plants on the cards a decent amount of australian gas will be heading off shore which again will have a positive impact on domestic gas prices.

I believe the future of natural gas is bright and beach is in a position to profit from that, and at current prices I think it is really good value.
 
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