I notice some discussion about AUT as a reference for MAD's develeopment/production/cashflow. I have studied AUT extensively, primarily because I see it as a company that is several years ahead of other junior oilers like MAD so indicative of what they could become and useful as a benchmark for progress (disclosure: I dont hold AUT).
I'm happy to share the folowing two images. The 1st being a table showing the earlu history of development of their Sugarkane field, which took 4 years before Hilcorp were farmed in and really drove the growth in production starting from year 5 2011).
The 2nd image is a graph showing AUT's growth in production revenue and cash spend on development for the 5 year period up to Q2 2013.
From this data you can see how long it has taken AUT to get where it is with Sugarkane. Also how much additional capital they brought in in the form of both equity and debt, and in the early days via farming out (which they subsequently paid a lot to reverse).
The sales & capex spend graph show that even now (up till 2013 Q2) the capex spend on field development remains high and although seems to have peaked last year and come down gradually, remained about sales until 2013 Q2.
A lot of the junior oilers I follow, that are still way behind where AUT is, are following a similar pattern re capex spend, cashflow, etc as they grow production & sales. MAD in my view has done as well as any to minimise dilution in the early stages and certainly better than AUT in the equivalent stages.
Cheers, Sharks.
FDM Price at posting:
49.5¢ Sentiment: Hold Disclosure: Held
