Updated Cash Margin spreadsheet & forward view.
I would consider the 10Q overall to be quite +ve (the -ve is still the Debt covenant and while the BB was reaffirmed which is itself an achievement (as in not reduced) MOB has not relaxed the covenant and so its sort of a sword of Damocles).
Cash Margin for the Qtr was $8.58/Boe - well done - brought about by an outstanding reduction in LOE by more than 40%!!!
Assuming that productivity stays and production holds along with modest sustained POO increase its possible for SSN to achieve a $20/BOE Cash Margin this Qtr.
Same as before - Black numbers are reported and blue is implied or estimated
View attachment 64292
If you're aren't bothered with the EBITDAX covenant then its all good short term.
Only the commentary re
"The funds drawn from our credit facility will be used to fund drilling in our North Stockyard project in North Dakota. We expect to fund our remaining capital expenditures for fiscal 2015 with cash on hand, cash flow from operations, and drawdowns of our credit facility (to the extent available). We may also elect, where we consider it reasonable and appropriate, to raise funds by the sale of selected assets."
and
"These funds, along with cash on hand and cash flow from operations, will be used to fund drilling in our North Stockyard project in North Dakota. We expect to fund our remaining capital expenditures for the fiscal year ending June 30, 2015 thereby, though we may obtain additional capital through further drawdowns of our credit facility (if possible) or another capital raising program or asset sales."
which reads to me to as short term (this Qtr) we are OK but when the time comes to drill in Rainbow additional capital will be needed to participate.
All usual caveats stand - just my opinion and calculations - best efforts no guarantees.
