Value to be found

Couple interesting points to note.

KAR hold the majority of their money received from Origin in USD. Acts as natural hedge as most of their costs are in USD. This can be clearly seen from last Qtr.( I did not confirm with company but I'm fairly sure they would do this)

Based on Australian dollar decline I now estimate that so far this qtr the AUD equivalent in cash will have grown about 20-25 Million. Last qtr it was 38 million .Allow small Interest of about 6 million.

699 + 25 + 6 = 730 Million

less outflows

55 ( exploration & Dev & admin ) and Buyback 14

means nett cash position about 661 M AUD divide by approx 244 Million shares

We are trading below cash backing.approx 2.70 ( even allowing for spend of 55 million in the qtr)

Assuming 2P for Kangaroo is say 200 Million and our 65% is 130 Million and assuming a low in ground value of 5 USD per barrel

approx 2.65 USD per share

Clearly the trick here is not to throw out the baby with bathwater. Sentiment for the sector will change maybe even if only by M & A opportunities.

The tide will turn. When I don't know, but undervalued assets don't stay undervalued forever.

this makes no allowance for exploration upside or their other assets. like KW

I notice the CVN just sold the oil producing assets in Thailand ( deal not yet done) for 10 USD per barrel for 2P ( theirs is onshore)

I made decision to add again on Friday 2.27 for 11K shares.

I know I cannot pick the bottom but if my numbers above are right and Bob has not take the 600 Million to the Casino and blown it all on Roulette then conviction is to buy.

Where are oil prices headed - no idea and the experts don't really know either. 3 million supply surplus is really not large and consumption of oil does have strong correlation to price. Additionally other factors can impact supply quite quickly.

GLTA but even more importantly perseverance