Silicon Investor (SI) -- The First Internet Community

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 : Petrokazakhstan Inc. -- Ignore unavailable to you. Want to Upgrade?

To: a_player_2001 who wrote (988)	4/9/2000 7:20:00 PM
From: forecaster	Respond to of 2357

I.Q.2000 Forecast (Correction). I reexamined the recent history of the number of "issued" and "to be issued" shares. This is how I understand it: OUTSTANDING BEFORE ACQUISITION: 44,647,359 SHNOS ACQUISITION (Circular 34-35 and recent press release): CAII (issued) 88.36%, 19,430,796 shares, US$ 45,063,600 Minority (not issued) 11.64%, 2,559,693 shares, US$ 5,936,400 Total 100.00%, 21,990,489 shares, US$ 51,000,000 SPECIAL WARRANTS: 9,346,000 Deal closed on March 7, proceeds received on March 31, but the share issuance depends on the filing of a prospectus within 120 days from closing. STOCK OPTIONS: 2,686,500 OLD WARRANTS (Series 5): 4,950,000 Therefore, it is rather tricky to determine what will be included in the average number of shares outstanding during the first quarter. For the forecast, I think we should count only those shares that Hurricane used in the proforma financial statements for the year 1999, i.e. the outstanding shares before acquisition plus ALL shares paying for the acquisition. This total is 66,637,848. FORECAST CORRECTION NET INCOME/SHARE: US$ 0.53 CASH FLOW/SHARE: US$ 0.60 12-month rolling earnings: US$ 1.06 Should the share price increase to US$ 6.00, this would represent a P/E of only 5.7.

To: a_player_2001 who wrote (988)	4/10/2000 11:10:00 AM
From: Hickory	Read Replies (1) \| Respond to of 2357

Player, My info on the militant fundamentalists came from an American who lives in Almaty. Last fall I spent considerable time talking with him during one of his visits back to "The States." I had no reason to doubt his veracity and I had no way of verifying that what he told me was NOT true. As to the figure for the Net Present Value of Hurricane, it very much surprised me that it would be that low. Before I did the calculations, I had expected that it might be somewhere around US$ 10. There would be no point to me trying to talk the price of HHLA down. As I have stated before, I am as fully invested long in HHLA as I can be and have no money to buy more, even if it were to sell for $0.10 a share. I explained why I used the Constant Price basis. I believe, and FoxyLoxy also stated, that a 15% discount rate is too low for a co. of this kind in this part of the world. What happened to it in 1998 is pretty well proof of that. So is the 16% interest rate that it now is paying on debt. So I used the 20% discount rate. With those two assumptions, I merely took the figure that McDaniel gave on page 83 for the discounted present value of Hurricane's reserves. In post #987, in reporting my calculations, I gave the page numbers in the "Information Circular" for my various figures, so anyone can look them up for themselves. What brings the Net Present Value of Hurricane's shares so low is the huge amounts that it is obligated by the privatization terms to expend before Dec. 31, 2001, plus the heavy debt, high interest [16% instead of the original 11% or 11 3/4% (pp. A16-A17)], and restructuring fees. As far as I can tell from the "Information Circular," our co. must pay out more than US$ 400 MM in less than 2 years. Hopefully, its cash flow will surge and be able to fund these expenditures internally, without the co. having to sell more equity (as FoxyLoxy thought would likely be necessary). After Hurricane pays down these obligations (hopefully by Dec., 2001) IF no new big problems arise in the next couple or years or so, it could become a VERY profitable company. It may be that the method I used for figuring Net Present Value is faulty. Basically, I followed the steps used by Forecaster, but with different original assumptions. I would very much like to be proved wrong, because I desperately want to see HHLA's stock price rise. However, I feel that in their eagerness to see their stock appreciate in value, too many posters overlook some very important considerations and wishful thinking supplants hard-nosed objectivity. Again, I would love to be proved wrong in my calculations. Hickory