MXP issued full accounts today and they make for very detailed reading. Many questions that shareholders have been scratching their heads over with regards to the cash burn and production issues are answered.
It’s a little shocking that the corporate governance at MXP deems some of the information revealed as not market sensitive. For instance, the new Kaza gov rules on exports have heavily effected the production numbers/revenue and continue to do so. Today is the first time that shareholders have been informed ‘in detail’ over the restrictions in place. There’s a bundle more ‘sensitive’ items that have been disclosed that really should have been RNS’s long ago.
In summary – it’s a wonder that any international business operates in Kazakhstan as the red tape and protracted nature of exploration and production seems utterly presposterous.
One thing is clear from today’s announcement/comments. Never have the shallow drills been so important to MXP than now. They have 4 drills coming up (one currently underway) and they need at least 2 successes.
A further 3 drills could follow but are subject to finance.
Full results RNS can be found here
The board should be fired, the recent bid rumour to cause the share price to spike circa 14p was the opportunity for people in the know to get out and trouser a few quid while us lot were well and truly shafted. Never have I seen such a hype in a share than MXP and I was a sucker as well. The fact they have not disclosed full details in a previous RNS says it all!
I agree – heads should roll. But if you look back to 2007 the trouble started with the Board coup d’état on the then CEO Steve Kappelle and COO Ole Udsen.
Ironically – the $14mln tax charge that appears to have taken the wheels of the trolly recently actually relates to the accounts signed off by the above mentioned.
MXP’s failure to detail many of the points that came through on the results rns demonstrates a complete lack of awareness and understanding of their responsibilities imho.
They’ll be lucky if they are not sued for miss-representation.
That said – if the next 4 shallow wells come in good – then no doubt they’ll be looking at share option awards lol! Oh, the shame of AIM!
Interesting. They reduced a $18m loss to $8M and that was with a $5M reduction in revenue. The operational costs for the last 2 years have been fairly consistent and I suspect they will remain so for the coming financial year. Since the end of March 2012 they have additional wells on FFD and the revenue is now averaging $7.5M per month. Take the additional revenue, and a consistent operational base and this would indicate a net cashflow position – positive – as they have stated previously – and a profitable 2013.
Also remember – March 2012 – almost 5 months ago and since then we have seen UBS & Henderson increase their stakes, and also seen Zhanros pick up the bill for the drilling – whilst maintaining the cost base. The BOD have proved they can fund the shallows to an extent by a lateral thinking deal. If they can sort out NUR – the big prize – either by extending the license agreement or getting funding one way or the other for the remaining 1500 feet – which lets face it – is the BIG prize – then they will be back in very good shape. Everything to play for and I am sure there will be a company out there just itching to get a piece of action in Kazakhstan. Remember – MXP will have learned a lot about NUR – they say they can do it subject to funding. I suspect they can and will.
For me – thisis a great opportunity to pick up more shares – but my risk appetitite is higher than most (thankfully). Nice work Sharehub – keep it up!