According to Stockopedia Enteq Upstream has a market cap of only £16.5m ($22.9m). According to the last set of interim results it had cash of $15.3m, so the market is only valuing the company at $7.6m. Sales increased to $2.5m in the last 6 months, with a gross margin of 70%. What's not to love? Rig count rising relentlessly. The only question is can you get hold of the stock in the market. Bid/offer spread is a ludicrous 10%+
"Halliburton Oilfield services chief is gushing about shale boom
The North American shale oil boom will step up a gear this year, the boss of the worlds second largest oilfield services provider has predicted.
Jeff Miller, president and chief executive of Halliburton, said that he was optimistic about the prospects for the oil industry generally and for North America in particular, where the companys revenues are climbing.
Shares in Halliburton rose by 4.9 per cent to $55.63 yesterday afternoon after it unveiled improved fourth-quarter results driven higher by North American shale activity. Mr Millers optimism echoed that of Paal Kibsgaard, the head of Schlumberger, the worlds largest oilfield services group, on Friday.
Halliburton, which is valued at about $50 billion, and Schlumberger, which is worth about $110 billion, help drilling companies to set up oil and gas wells. Their financial performance and commentary from management are seen as bellwethers for the oil industry....
...Mr Miller said said that he was optimistic about what I see in 2018. Revenue from the completion and production division was $3.8 billion, against $2.3 billion a year ago. The drilling and evaluation division reported revenue of $2.1 billion, up from $1.8 billion. The rise was powered by increased drilling activity in the Middle East and North America and by sales in Latin America."
"Enteq, the oilfield services technology and equipment supplier, announces an agreement to acquire intellectual property relating to an innovative drilling telemetry system for a nominal upfront consideration of £100.
On 9 January 2018, Enteq entered into an agreement to acquire, from a technology developer with a proven track record, five patents relating to the "DrillLink" system; a broadband data transfer solution for communication between "down hole" Logging While Drilling tools and the surface.
Enteq envisages developing these patents into a fully commercialised set of products during the next five years, which would be subject to royalty payments. The technology contained within these products will give Enteq access to a new and broader customer base.
Martin Perry, CEO of Enteq Upstream plc, commented:
"The acquisition of these patents continues Enteq's drive to develop new technologies that extend the applications for our product lines. Following further development the technology contained within these patents will offer the market significant cost savings through improved speed of data transfer."
Enteq, the oilfield services technology and equipment supplier, announces a contract from a new international customer.
On 7 December 2017, Enteq received confirmation and a cash deposit relating to an initial contract valued at $0.5m for operations in Indonesia. This is the first order Enteq has won in this territory. The contract is for using Enteq's core MWD ("measurement whilst drilling") technology in a geothermal application. The order will be delivered to the customer early in 2018.
Martin Perry, CEO of Enteq Upstream plc, commented:
"Enteq continues to develop new territories and applications for our equipment. This contract award represents the ongoing efforts to broaden the company's market presence."
"The increase in North American activity and international opportunities has necessitated the expansion of our global support team....."
"Near Bit Inclination and Azimuthal Gamma.
Enteq has partnered with Houston based Well Resolution Technology to give Enteq access to unique directional drilling technologies such as the WRT Near Bit Inclination and Azimuthal Gamma Ray tool......"
Enteq has been awarded a prestigious grant for a joint project with Imperial College, London, and the Chinese University of Petroleum, Beijing....."
"MFPWR Resistivity Tool
Production models of the RMS Multifrequency Resistivity Tools have now been running for over 6 months in the field with results judged to be fully comparable to those of a major international service company. Inventory levels of all sizes, including a slim 3.5 version, are being increased to meet market demand...."
"Martin Perry, CEO of Enteq Upstream plc, commented:
"Enteq has weathered the storm of severely reduced drilling activity globally over the last two years and is now entering a more stable market with a low-cost base, preserved cash balances and a strong technology platform from which to build. Uncertainty does remain and caution will continue to be exercised. However, Enteq has a solid customer base, a proven technology platform and a strong balance sheet, all of which will enable Enteq to take maximum advantage of future growth opportunities. "
Pretty good AGM statement just out, with trading in line. Note that the $15m cash pile is almost untouched:
"The increase in the number of oil and gas rigs drilling on land in the USA to a current level of around 950 (approximately 500 in September 2016, but approximately 2,000 in the Autumn of 2014) has created some stability amongst the US based directional drilling companies, who are Enteq's primary customers. Some spare capacity of older Measurement While Drilling (MWD) kits remain in the market however upgrade programmes replacing older equipment are in progress.
Outside of the USA market cash flow for the funding of new drilling programmes, and hence the demand for equipment, remains slow. However, new opportunities exist and the previously announced Saudi Arabian contract remains on plan regarding equipment commissioning and contractual payments.
The Enteq Board is confident that the company is maintaining or increasing market share for Measurement While Drilling equipment.
The Company continues to invest in new product development while exercising tight controls over costs and, as a result, cash balances remains strong as at 18 September 2017 being US$ 15.0 million (US$ 15.2 million as at 30 September 2016).
The Enteq Board continues to believe in the potential for a strong long-term future, and expect the Company's current full year trading to be in line with its expectations.
The Company plans to release its interim results for the six months ending 30 September 2017 on 15 November 2017."
Steady as she goes results. NTQ is ready for an upturn. The downside is protected by the very well looked-after cash pile, whilst there's serious upside if and when the sector continues to solidify and cap ex starts to improve.
There's around 20p per share of cash and 30p per share of net assets, compared to the current 23.5p share price.
A brief summary from Malcolm Graham-Wood yesterday:
"An old friend, Enteq Upstream has results today and due to cost cutting and generally careful progress the losses are reduced. The company say that they have retained a sustainable business in difficult market conditions and have looked after the cash, they still have $15.3m for sunnier days. Another one to keep an eye on."
- cash actually increasing to around £12.5m, against the £13.7m m/cap
- in-line revenues and EBITDA
- the overall climate improving slowly
- expansion in Saudi Arabia and new patent applications increasing NTQ's IP value
"DJ Oil Steady as U.S. Shale Shows Signs of Resurgence
By Kevin Baxter and Jenny W. Hsu
Oil prices were little changed Monday as reports of increased drilling in the U.S. dampened appetite among investors following last week's 2% uptick.
The April contract for global crude benchmark Brent was down 0.14% to $56.72 while its U.S. counterpart West Texas Intermediate edged up 0.03% to $53.86 for March deliveries.
Oil-field services company Baker Hughes reported that shale oil rigs in the U.S. grew by 17 last week to total 583. This led many analysts and market observers to predict that 2017 will be the comeback year for shale oil after two years of cost-cutting and bankruptcies.
"We expect a strong revival in U.S. shale oil production and expect yet more rigs to be added to the market," said Bjarne Schieldrop, an analyst with Stockholm-based SEB bank.
He said he believed that spending on U.S. onshore oil exploration and production will rise by 30%-40% in 2017 and the rig-count could be higher than 1,000 by 2019."
Management have done a superb job in hunkering down. There are glimmers of light, but recovery is going to take a while - unless the global opportunites NTQ talk about start to come through, like the new Saudi contract.
Nice 30k buy at 16.49p caused the tick up, no doubt inspired by the rising oil price.
NTQ have around £12m cash at current exchange rates, plus a net $2m net receivables/payables, $4.2m inventories and $2.9m PPE - including $2.3m of land and buildings. That's around £19m, against a £9.8m m/cap.
NTQ also recently highlighted this article on their web site about new drilling technologies, including their own:
I bought a few of these due to the discount to cash and assets. It just seems compelling to me. Just one of the few stocks I have bought in a small way as a punt on an improvement in the oil price in the coming years.
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