Chariot – Latest Interims & Presentation

A very good set of interim results was accompanied by a very interesting September presentation that bodes well for Morocco and Namibia. There are some elephant sized opportunities in Chariot’s acreage for sure.

The market seems to like what it is seeing.

 

 

Chariot Interim Presentation

On 23rd September Chariot hosted an analyst conference then a PI conference in the morning. I have not seen any sound recording of the event that has the questions that were asked. I have however seen a audiocast t and a CEO video released the same day – which comes across as interesting and very informative albeit a bit ‘staged’.

http://link.brightcove.com/services/player/bcpid4463153139001?bckey=AQ~~,AAAAsC7blrk~,X9VcU7f9F99E6WObd7x-E63_yffgEmak&secureConnections=true&secureHTMLConnections=true

The PI conference was interesting and was held at Fincap’s offices a short walk from Liverpool Victoria Street station. Several of us met up in the nearby Cafe prior to the event. We all had the same thing in common – frustration at the way Chariot has communicated with PI’s in the past, and huge frustration at the woeful share price. The company’s share capital had decreased by £36m in the 36 months Larry had been CEO. £1m per month. The recent directors remuneration cut seemed small beer in comparison but was quoted in the presentation as an example of good capital discipline. How about some market capitalisation discipline folks?

Many questions were asked – more than I have ever encountered with Chariot previously. Larry handled most of the questions, with Julian handling a few money related questions. Julian’s commentary was spooky – very similar to Mark Reids in July of last year but without the Scottish Accent – you know the story, well funded, strong balance sheet, no debt, few commitments etc – and we know what happened 4 weeks later in August 2014 . The question was asked – are you going to have an other placing to which Larry immediately responded – ‘no plans’.

Other questions were along the lines of which data room was the busiest – Larry stated it was too close to call. He was asked whether Mauritania the most likely to farm-out a tier 2 first, again Larry responded with talk about lawyers taking a long time to do stuff (which in itself was interesting – think about it), compared to nimble Chariot so he could not answer that one although earlier he was at pains to stress the world class 20tcf discovery in Mauritania by Kosmos, and the two elephant sized Senegal finds by Cairn (Our Mauritania Partner).  Larry was in elephant hunting territory.

Was Chariot going to buy back shares since the company had not purchased a new venture – no came back the response. How many due diligence activities had Chariot undertaken in the last year.Larry said 50. What! 50! Well I personally find that a hard one to comprehend – but I suppose it depends on what you describe as due diligence. My experience is DD takes a lot of effort and 50 seems shall we say – too many! Maybe he meant he had looked at 50.

Larry came across as rational and honest as would be expected.  This is no fly by night AIM company. I thought he was rattled a few times when talking about Non Exec Directors and their lack of shareholding’s. I mean – Dave Bodecott, the founder of Rockhopper, NED to Chariot – has bought a few with in effect a buy one get one free offer – not a great message to PI’s in my humble opinion. Larry was not a happy bunny at that point IMO and talked about how experienced the NED’s were – which completely missed the point. With that experience, surrounded by a world class exec, world class management team etc,world class source rock, and world class custard creams and coffee you might be forgiven for expecting a world class purchase of shares in Chariot by some of the NEDs.

Larry mentioned that they were operating in each of the four regions because they believed in each of the four regions. Importantly he said that even at $50 a barrel that given the size of the prospects that they were attractive profitable assets. Exploration costs had dropped considerably and Larry was optimistic of a farm-out and getting the drill bit turning.  In addition by the time a company drills and gets it out of the ground its a few years off. Anyone expecting oil to recover over the next few years (undoubtedly imo) will think that now also presents an interesting opportunity for elephant type structure drilling.

Overall, Larry came across as knowledgeable, rational, prudent and driven to secure a tier 2 farm-out.

Other

On another note, Sharepickers are asking which CEO you would like Justin to interview – https://www.surveymonkey.com/r/SNN8QDT  – please fill it in 🙂

Malcolm Graham Wood also stated  on twitter that he would get on the case with Chariot.

And share magazine has also shone a light on Chariot

An interesting view on the presentation can also be found here