ATPG Shareholders Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : ATPG Shareholders

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

From: Flipper2058	9/2/2012 11:18:22 AM
	3 Recommendations Read Replies (2) of 3620

Need some help from long timers in ATP OK, I know this post is not going to go over well but I would be interested in some counter-points to concerns I have. I am new to the situation and learning as I go but the values have me concerned. 1) Getting Clipper on line is most important to the over-rides and NPI's as according to the management 8-K nearly 1/2 of the cash flow goes to those. The depletion afterward looks steep. Since our concern is POST filing Clipper just reduces debt....of course not a bad thing. 2) Trying to use an EBITDA multiple to value worth appears very spotty at best, again looking at the steep drop in production from the 8-K from 8-13 on to 2-14. 2013 numbers come in reasonably heathly but extrapolating 2/14 numbers assuming a slight drop from there ($48.9m/m to $35m/m for remainder of 2014)....subtracting normal expenses, continuation of ORRI/NPI's payments...etc etc...comes in UNDER $200m in EBTDA for 2014. A REAL concern. So trying to take 2013 $600m in EBITDA and apply a multiple to compute an EV seems worthless. Using a forward 4 multiple on 2014 at $200m is $800 EV...$400m below first lien debt. 3) Which leaves to which EV valutaion would may be highest.... PV-10 or standardized asset measurement (tax losses from write downs may help here).... a) US proven and developing(PDP) at 25m proven undeveloped (PUD) 49m starts us out. 18 months of production at Clipper and Telemark likely will reduce the PDP to half their value....call it 12mmboe..... b) management has written down proven on UK assets because of expectations that Octobouy will not be utiltized. This puts all value of the UK into the PUD category, with no capital plan makes them worth far less if much at all. 4) The firm has been seacrhing for a minimum for 6 months I can see for partners (based off their April presentation) Their write down of UK assets shows they might be holding little prospects for UK assets. $492m has been spent realted to it. 5) The DIP specifially will not allow any cap ex in foreign waters. Israel may be a large prospect with ATP having almost no money in it but the $600m plus needed to develop it combined with Noble's huge find filling many of Israel's needs makes Israel almost a non-event. Discounting cap ex needs on the values would be too steep to probably put any worth on them. 6) Cap Ex per the management 8-K drops to nearly $0 by next summer. Given ATP's history of double the depletion rates on their wells versus industry norms makes me wonder if they might be too optimistic even on production by 2/14 exit. I am trying to determine not NOW what ATP is worth but a conservative estimate when it counts and the valuations come in.....at Exit. Sorry to be negative...again this is a "concerns post", not bashing. But this is why the debt is $26 not $100, so it doesn't mean these concerns are not worked thru. Just trying to figure out how. I am long bonds presently. Thanks

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next