i sold out last week.., good time to buy now.., i am shopping
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i sold out last week.., good time to buy now.., i am shopping
i was a big decision last week.., need the money to buy til..., which is good.., now time to get back
SP has been up to 362 this month and back to 330 today. It's the only NZ share in my portfolio of 20 companies to have a downer today. What's the problem with NZR?
Don't think there is any specific problem - just look at the SP pattern - you can nearly deduce based on the graph when they release their 2 monthly throughput numbers.
Remember - they talked about a bit quieter 2nd HY, though the numbers so far don't seem to support that. Outlook for 2016 was quite good (and should be with the new plant).
One thing which might be a (slight) dampener is the rising oil price - cuts into the margin, but I don't think that it will hurt as long as oil stays well below the $60 mark - and that's what the Brent futures indicating.
How do they say: don't panic, but as always - DYOR.
Discl: holding;
Even I got bit perplexed by the recent weakness in sp. Only thing that I an think of is stronger NZD in the past week or so, but that shouldn't be of much concern in my opinion, its only a short term spike. Could be market waiting for next catalyst to drive the price further. Happy holder either way.
Some big parcels traded off market in the last hour or so...
it is healthy trend ..just taking some profit., and will up again..,
Singapore complex refining margins have fallen $2 to around $6/barrel in the quarter ending September 30th.
Attachment 7675
According to NZR
"Singapore complex margins for the period [July August 2015] softened compared with the first half of 2015 to an average of USD 2.52 per barrel"
Does anyone know why there is a difference, and what the SCRM as reported by NZR is likely to be in September / October?
nzr refining use platts data for Singapore refining margin + ther grm uplift
https://nzx.com/companies/NZR/announcements/272159
Some positive initiatives announced to lift margins.
Cheers sb. Love that last bit "lift the refinery's margin by further USD0.90-1.10 per barrel":)
Will be interesting to see if they hit CAP again this month. If they continue to hit cap for the year it is fantastic for shareholders but it does allude to the fact that the margin improvement projects will be effectively irrelevant and in fact giving a discount to customers (users). I understand that the floor calculation is index linked to inflation etc but the CAP calculation has no such mechanism. Not that I am complaining if NZR make an average margin of $9USD/BBL but if they are/have spent several hundred million dollars to lift margins that they cannot effectively recover from the users then the processing agreements need to have a good shake up.
So, in short, anything over $9USD per bbl is money in the user companies back pockets at the expense of shareholders.
My one reservation with NZR is that any company with increasing expenses and a ceiling on income will eventually, inevitably go broke - assuming inflation of costs.
I wonder if the various 'fairness reports' NZR commissioned considered this.
IMO the ceiling and floor should both be inflation-indexed (or deflation-indexed).
Big off-market trade of 1.5ml shares transacted in the last half hour.
"
Singapore (Platts)--28 Oct 2015 414 am EDT/814 GMT
"The Singapore cracking margin against Dubai crude has risen sharply over the last five trading sessions to $5.49/b at close of Asian trade Tuesday, supported by firmer light distillate cracks, Platts data showed.
The refining margin had fallen to a low of $3.05/b on October 9, after earlier rising to a 31-month high of $7.11/b over September 23-25."
- http://www.platts.com/latest-news/oi...ct-on-27916443
$5 average for Sep/Oct maybe? Should be at or close to cap if so.
Looks like things are in bit of holding pattern atm, just side-way movements. Need another catalyst to push higher, new plant should be operational soon.
I am sure the new plant will help, but even without - just wait for the next throughput and margins report (mid November). I'd expect it to "de-risk" the current financial year ... and so far it looks like the margins are still fine (low oil, reasonable Singapore refining margin, though NZ$ creeping back somewhat).
Will be interesting to see the thruput report for the Sep/Oct period. I am picking another all time record for thruput (last period was 7.5m) and I think that the base Platts singapore refining margins are higher than what they were last period too. Exchange rates marginally better at 0.6508 for the current period. Could be looking at income circa 70m for the 2 month period. I guess we will know in the next day or two. If we keep on hitting cap the increase in production from new project (must almost be ready to go live) will be pretty magical for the remainder of the year. 2015 might be talked about for many years to come, well done to NZR for keeping the plant up and running in these times of "super profits".
I think the margin throughput report due next weeks will be quite telling as to how the annual results going to be, as their year end is Dec. I'm expecting it to be bullish along with new plant to be commissioned soon. Bring it on!
A snippet from Craigs research on ZEL
"Refining margin gains driven by a strong Singapore margin and efficiency gains
The company has seen significant increase in the GRM received , margins at NZ$11.6 and NZNZ$11.7/bbl in 1 Q16 and2Q16 respectively, this relative to the average NZ$2.4/bbl seen in the pcp.This was on the back of strong margins and record processing volumes, the rebate ZEL received increasing by NZ$15m(c.167%) in total relative to 1H15
While we expect a slight decline over 2H16 as singapore complex margins normalise toward long run averages , this decline should be partially mitigated by an increase in NZR's premium to the Singapore margin as result of the introduction of Te mahi Hou( a $US0.90/bbl benefit) and efficiency gains (US$0.13/bbl)"
Thanks for that JT, precisely the reason why Z increased their profit despite lower sales revenue on the back higher margins.
I expect the sp to rocket upon release of throughput report next week.
Wow that caught me by surprise, wasn't expecting the report out until next week.
Anyway great result overall, Blue skies from here I hope.
Snapiti was the one with the foresight and research freely shared to thank imo. Bring Back Snaps, Bring back Snaps....ohh he chose to leave us.......
Smashed thro' the day since the announcement.
Love that 30,000 on offer at $5.00 (not mine) on trading depth, that's where I'm thinking it'll be in 12-18 months time.
happy holder
Small top up today, and close to my largest holding (after MEL). Decided when price was $3.44 but went through at $3.50.
Not too worried when it closes at $3.63! :eek2:
awesome performance :)
Oil dropped further overnight and NZD tracking lower, augurs well for NZR.
Has the market finally really woken up to NZR? Up about 40c in the last 2 days - about 12%.
beautiful i love it
Welcome aboard mate :). As an aside, a friend who is a petroleum engineer told me yesterday that 30000 jobs have gone Worldwide in the petroleum exploration industries last 12 months. I know many people in that industry that are unemployed or facing unemployment. All points towards the companies believing we are stuck with low prices for a
long time yet
"A record glut of oil ( 3 Billion Barrels) is set to continue into next year and maintain pressure on prices, the International Energy Agency said on Friday. "
Source BBC News. http://www.bbc.com/news/business-34808487
After few quite days, this one is on the move too...
what a good year..,
might just be the start of things to come Golden City
http://www.hellenicshippingnews.com/...mand-supports/
Other articles are pointing to $9USD/BBL margins next year too... Running a full year at CAP is unheard of. Running more than a year will be gold buckets... I imagine the refinerys costs will be a bit lower this year as a lot that nasty interest stuff wont have to be paid due to paying down debt.
Am I too late to jump on board? :X?
Well it did start the year at the $2.15 mark so it has had a good rise this year.
However Rog has just bought in about this level so he sees more upside - it will be a good final dividend I think ( I would say at least 10cps ) and the interim of 5cps was unexpected.
A lot of the overseas refineries own the oil they process - the volatility ( $40 to $50 to $40 again) plays havoc with their inventory valuations and it seems they try to increase their margins to compensate.
i have been holding all year and am not tempted to sell yet - don't think I would buy at current levels though...
hope this helps :)
Thanks for that link cdonald.
Should be be close to $4 soon once the new plant is underway, which must anytime from now as they've indicated it'll be end of Nov to be commissioned.
I agree with crackity there vin re dipping your toes now, as it had a spectacular in the last few months and am not sure how much more higher it can go? Of course one would hope it keeps going up, I would probably look to get in on any dips(unlikely now). Pls DYOR and depends on your investment objectives too.
Most improved performance: Refining NZ
From the Deloitte top 200 awards last night.
Nice Award. I am pretty sure we will get a nice announcement this afternoon celebrating the success' of the new project along with the Deloittes award. Extra thru put for December and a strong margin. Oil coys now getting a significant discount on their products coming out of the refinery due to the CAP. Great that the NZD is sitting around 65 rather than 95. This will be a record year for income/profit
Happy to play the oil and currency lower for longer because I really believe the story and can't play it ALL through AIR. New project should boost shareholder returns and this stock adds some much needed diversification to my portfolio.
Should have been on board ages ago but better late than never...
I'm going to stick my neck out and predict we hit $4 before Christmas :)
and you might well be correct ... I don't think I would bet against this prediction.
More interesting question is - how much higher might it go if the current good conditions prevail for some time to come? Currently on a PE of 8.3 - and hey, it is a cyclical business, i.e. a PE of 10 during good times might be all it is worth. This would bring them up to $4.60 ... and if we allow for the improvements with their new plant, they might next year go well somewhere between up to $5,-- and $6,-- . Not sure, whether I would see much more growth potential, but obviously you never know - and obviously it will be a nice dividend stock until oil price and NZ$ (or both) go up again.
Or is there anything else I should consider?
As always - DYOR ...
Sums it up pretty nicely BP, thanks YDOR.
big volume going today
MSCI index rebalancing...twice a year, today was one of them.
It would be great to get news of the newCCR plant start up.. Or did i miss it ? Their web site is abit light.
Refinery’s Te Mahi Hou project goes live
9:58am, 2 Dec 2015 | GENERAL
Refining NZ is pleased to announce Te Mahi Hou is producing on specification gasoline and gasoline production on the old platformer has been stopped. This is a major milestone in the startup of Te Mahi Hou with a number of other milestones to be completed in the coming weeks.
The $365m Te Mahi Hou project was handed over for startup to the operations team on the 25th of November. This puts the project around three weeks ahead of the original completion date of late December 2015.
In the current volatile crude and gasoline price environment, Te Mahi Hou is expected to lift the Gross Refinery Margin (GRM) by approximately USD 0.85-0.90 per barrel and increase operating cash flows by around $50-$55 million. Te Mahi Hou will increase the production of petrol by Refining NZ by around two million barrels per annum, lifting the Company’s share of the New Zealand petrol market from around 55% to 65% percent. Improved energy efficiency as a result of Te Mahi Hou will see the refinery’s CO2 emissions reduce by around 120,000 tonnes per annum.
ENDS
Ok here we have it. I wonder how that will afect the SP today...?
Refinery’s Te Mahi Hou project goes live
9:58am, 2 Dec 2015 | GENERAL
Refining NZ is pleased to announce Te Mahi Hou is producing on specification gasoline and gasoline production on the old platformer has been stopped. This is a major milestone in the startup of Te Mahi Hou with a number of other milestones to be completed in the coming weeks.
The $365m Te Mahi Hou project was handed over for startup to the operations team on the 25th of November. This puts the project around three weeks ahead of the original completion date of late December 2015.
In the current volatile crude and gasoline price environment, Te Mahi Hou is expected to lift the Gross Refinery Margin (GRM) by approximately USD 0.85-0.90 per barrel and increase operating cash flows by around $50-$55 million. Te Mahi Hou will increase the production of petrol by Refining NZ by around two million barrels per annum, lifting the Company’s share of the New Zealand petrol market from around 55% to 65% percent. Improved energy efficiency as a result of Te Mahi Hou will see the refinery’s CO2 emissions reduce by around 120,000 tonnes per annum.
ENDS
Ok here we have it. I wonder how that will afect the SP today...?
Thanks Yoda .Looks already built in to s/p after nov 12 th announcement when Te Mahi GRM was announced and subsequent s/p jump, by the looks. Steady ahead and up; good for my ZEL too.
top performing bunch those fellas up there
top performing bunch those fellas up there
Interesting in the CO2 emissions. Total NZ net emissions is 300 million metric tonnes. So that reduces NZ emissions by 0.04%.
That should get a Christmas card from John Key.
Full year NPAT for 2015 I'm picking between 140 and 150 million ( normally announced late Jan )
Looking forward to 2016 - if FGE is in the ballpark then with the NZR margin iniatives 2016 will be a good year as well ;)
Energy consultancy FGE sees Singapore hydrocracking margins or complex refining margins, a benchmark for Asia, averaging $6.40 a barrel in 2016, down 80 cents from this year's expected average of $7.20. Read more at Reutershttp://www.reuters.com/article/us-asia-oil-refining-margins-idUSKCN0ST1A720151104#kSIYrrmqkWtVW7uJ.99
total agree Crackity. Margins for December are staying seasonally high (many a year margins in December have turned negative) but this year has been a cracker (pardon the pun). Next year looking strong and if the usd/nzd continues to hang out around 0.65 it will add another 35mNZD onto the bottom line from this year. (this year average rate is 70c). We should be back up to full dividends before long as the borrowing must be coming into line very quickly. No doubt the pressure will be on in the new year from the unions for a bit of a payrise as management used the "poor us" line last round so I don't think they can play that card again!
dividend policy I have cut and pasted below....
my estimate is borrowings of circa 198 million at year end looking at the matrix.
198 / 198 + 712 equity ( 910 total ) gives 21.7 per cent. Still sligjtly above their upper range but if the price / exchange rate stays similar then by about the end of april under 20% . After that large fully imputed dividends hopefully ;) :)
- declaration and amount of any dividend is at the sole discretion of the Directors at that time and is dependent on many factors including
- debt levels relative to Refining NZ's targeted 10-20% gearing (D/(D+E)) ratio,
- profitability, cash flow requirements, financial conditions and teax imputation credits.
- The aspiration is to pay top quartile NZX50 dividend returns over the investment cycle, specifically:
- During periods leading up to and including major capital expenditure the dividend pay-out expressed as a percentage of NPAT will be in the 40-60% range unless otherwise advised by the Directors.
- During periods of modest capital expenditure and optimum debt levels, the dividend pay-out percentage will be above 60% unless otherwise advised by the Directors.
looking at about 20c dividend at final
why share prices going down., should be up by now?
shell has nothing to do with nzr anymore....strange reaction
I guess people are scared/misinformed?
folks, not sure whether I understand the concerns. Sure, markets can always behave irrationally, and some day even this classical example for a beautiful uptrend will end. However - so far I don't see any hint that this some day might be now: We have still an unbroken uptrend with the SP just slightly retreating towards the MA50 (as it did various times before in the last 6 months - actually in May it was even below the MA 50 and the world didn't end).
Just wait for the end of year data and the dividend announcement - this will put some fire back under the SP.
What is the perceived problem?
think the govt looking to put a new tax on oil cargo, not sure if nz refining will pay this or the oil companies
Haven't heard about that, but if they do than the only one who would pay for such a tax is the consumer ... (as always). Can't see how this would be material to NZR's business.
Does the article from Sharechat have any thing to add to the SP ?
-------
"There's a war going on between Saudi Arabia and the United States. But this war has nothing to do with armies charging through the deserts of the Levant.
This war is all about crushing U.S. oil producers — driving them out of business and making the world safe for the Saudi-led cartel known as the Organization of Petroleum Exporting Countries, or simply OPEC.
The latest salvo in this petrol jihad came last Friday in Vienna, as OPEC held its semi-annual meeting. At that meeting, the cartel decided not to cut oil production.
Instead, it effectively increased production to some 31.5 million barrels per day.
Since that Friday decision, the price of crude oil has been in freefall."
price looks cheap.., have add some more to my position
oil prices keep going down...looks good
I stand to be corrected here but simply put- as oil prices go down, usage (demand) goes up. Their (NZR) profit is based on margins applied to volume throughput, not on actual oil prices. Currency also plays a part in the profit calculation for NZR.
Yep I agree, also price movements allow opportunities for increased margins (profit) e.g. by not passing on the benefits of the lower oil prices as quickly as consumers may hope etc. Not nice, but it can happen.
However I suspect the possibility that NZR may be adversely effected by 'climate change' and 'carbon emission' expectations recently entrenched in Paris may hold back the SP??
Disc - Holder
Te Mahi Hou project article
http://www.nzherald.co.nz/business/n...ectid=11562988
A big gas deal with Vector to boost margins http://www.nbr.co.nz/article/vector-...inery-b-183216
Hi All
Happy New Year and may NZR finally achieve anticipated liftoff. Can anyone please inform me what the current applicable offshore refinery margin is. Thanks. We can then extrapolate a future for this co based on the current exchange rate and recent historic throughput - co actuals expected about 20th.
Happy investing in 2016
-dodgy (owner/shareholder/accumulator)
Back in the day when the refinery was a Think Big project the refinery was designed to refine Iranian Sour grade oil. It was built this way becuse we sold mutton and butter in exchange for oil.
It looks like the Iranian oil embargo will be lifted within days. My question is does the refinery still have Iranian Sour cracking capability and will it be able to charge higher toll processing fees because of it?
Boo boop de do
Marilyn
.......these super-low barrel prices must surely be helping NZRs bottom line. Have I got that right?? Add to this Craigs prediction of a 14% plus dividend (at current SP) must make NZR a screeming buy??
in short, yes and yes. So should be good for the refinery in general. I expect we will get an update today of the margins for Nov/Dec and a full year earnings report too. From what I understand margins are still well above cap so it should be a pretty stunning result.
......to quote Craigs., " we see several positive catalysts for the stock over the coming 12mnths incl a reinstatement of the dividend policy and an end to the major capital expenditure programme". They are forecasting a dividend yield of 14.3% which has to be one of the best (if not THE best) currently on the NZX. BULL do you know will the low Barrel price be helping or hindering NZR??