APA

6.28%

$7.16 apa group

Ann: APA 1H24 Interim Financial Results, page-23

First 23 Last

Share
Profile

Follow
Tarvold

23,027 Posts.

1261

01/03/24

19:56

Post #: 72704360
Share

Originally posted by Winniethepoo: ↑

Another perspective on those points would be:

1. I don't think free cash per share is not misleading. A full period of contribution from Pilbara will also see higher interest costs, higher SIB capex and higher tax. I dont see how Pilbara is free cash accretive. The average cost of new debt issued in relation to acquisition was about 8% for annual debt cost of about $80m (based on $1bn debt for Pilbara). EBITDA for Pilbara is expected to be about $130m on annual basis in FY24. This leaves max contribution of $50m (130 less 80) to free cash before even accounting for SIB capex and tax. With over 100m new shares issued for Pilbara that $50m is less than 50c of free cash for each of those new shares compared to APA Group earning over 90c/share of free cash before the acquisition. Very happy to be corrected on this but I cant make the maths work.

2. What basis do you have to say gas generation volumes will increase? Forecasts from likes of AEMO have gas generation volumes falling.

3. What has fx got to do with the weaker credit metrics? APAs debt metrics are getting weaker as shown by lower FFO:debt in latest result.

4. APA could charge higher prices when contracts renew. But they might end up having to accept lower prices too. I wouldn't invest on assumption that they will be able to charge higher prices at same time as regulatory pressure is stepping up on pipelines and higher cost of living environment pushing back on companies looking to price gouge.

5. Increased capacity is fine if it is matched by increased earnings. But it hasnt matched earnings. And I wouldnt assume that there will be a "catch up" in earnings. Higher costs tend to be sticky in my view.

6. Higher capex is fine if matched be increased earnings. But it isnt. Earnings are not up 100% since FY22 while these capex items are. That is a drag on free cash.

7. It is still going to be a drag on free cash over next few years as it normalises. And will it normalise at prior levels or at a higher level?

Expand

APA stated that the Pilbara assets were cash accreditive, are you claiming they lied?

APA Price at posting: $7.88 Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

Reply

Top Stories

SGR

Thousands eye Star on HotCopper, SkyCity in strife – are ASX casino stocks safe anymore?

YAL

Yancoal Australia reports strong Q3 financials

M4M

Macro and Norden set up transport solutions initiative for West Pilbara

TYP

Tryptamine psilocin treatment found safe in IV infusion during early stage trial

ASX Market Open: ASX set for red Friday after flat night in Wall Street | 18 Oct

SWP

Swoop lobs $18M offer at microcap telecom Vonex – in which it holds 19.9%

TLG

Talga Group wins key permit for flagship graphite mine in Sweden

THB

Thunderbird picks up plethora of uranium targets based on EM survey in Canada

TLX

Telix Pharmaceuticals' quarterly revenue exceeds AU$200M

MKT

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

There are more pages in this discussion • 3 more messages in this thread...

First 23 Last

Add APA (ASX) to my watchlist

(20min delay)
Last $7.16		Change -0.480(6.28%)		Mkt cap ! $9.271B

Open	High	Low	Value	Volume
$7.26	$7.26	$7.09	$132.1M	18.36M

Buyers (Bids)

No.	Vol.	Price($)
25	41244	$7.16

Sellers (Offers)

Price($)	Vol.	No.
$7.17	4180	1

View Market Depth

No.	Vol.	Price($)
24	41105	7.160
69	424516	7.150
17	65309	7.140
16	25538	7.130
19	76088	7.120

Price($)	Vol.	No.
7.170	4180	1
7.180	10000	1
7.210	2089	2
7.240	34095	3
7.250	41462	5

Last trade - 16.10pm 18/10/2024 (20 minute delay)

APA (ASX) Chart

Ann: APA 1H24 Interim Financial Results, page-23

Thousands eye Star on HotCopper, SkyCity in strife – are ASX casino stocks safe anymore?

Yancoal Australia reports strong Q3 financials

Macro and Norden set up transport solutions initiative for West Pilbara

Tryptamine psilocin treatment found safe in IV infusion during early stage trial

ASX Market Open: ASX set for red Friday after flat night in Wall Street | 18 Oct

Swoop lobs $18M offer at microcap telecom Vonex – in which it holds 19.9%

Talga Group wins key permit for flagship graphite mine in Sweden

Thunderbird picks up plethora of uranium targets based on EM survey in Canada

Telix Pharmaceuticals' quarterly revenue exceeds AU$200M

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

Ann: APA 1H24 Interim Financial Results, page-23

Top Stories

Thousands eye Star on HotCopper, SkyCity in strife – are ASX casino stocks safe anymore?

Yancoal Australia reports strong Q3 financials

Macro and Norden set up transport solutions initiative for West Pilbara

Tryptamine psilocin treatment found safe in IV infusion during early stage trial

ASX Market Open: ASX set for red Friday after flat night in Wall Street | 18 Oct

Swoop lobs $18M offer at microcap telecom Vonex – in which it holds 19.9%

Talga Group wins key permit for flagship graphite mine in Sweden

Thunderbird picks up plethora of uranium targets based on EM survey in Canada

Telix Pharmaceuticals' quarterly revenue exceeds AU$200M

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News