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Maha Energy

Maha Energy

Oil and gas producer

Maha Energy is an oil and producer operating two fields in Brazil (Tie and Tartaruga). It has minor operations in the LAK field in the US. Its strategy is a combination of production, pursuing upside in its portfolio from production drilling and appraisal, and modest near-field exploration activity. It also looks for growth through M&A with a broad mandate, focusing on onshore oil and gas. Its main operation is enhanced oil recovery (EOR) through the development of proven hydrocarbon reserves.

Contingent on positive results from testing operations, and an expected renewal of the Tartaruga Block concession, a full field development could increase the commercial lifetime of the field and utilisation of the reservoir. With its robust capital structure, the company is also well-positioned for more M&A to diversify its operations. Also, Lak Ranch is not included in our valuation, providing interesting opportunities for our estimates.

Maha Energy is exposed to adverse changes in oil and gas prices. The functional currencies are USD, SEK and BRL, while the trading currency is SEK, i.e. it is exposed to adverse currency fluctuations. The company is also exposed to its contractors’ ability to execute projects according to the schedule and on budget, including infrastructure in place and offtake capacity, with limited diversification between assets. Operating in several countries, with various political and regulatory regimes, the company is exposed to adverse changes in regulatory and political regimes.

USDm 2019 2020e 2021e
Sales 48 28 53
Sales growth (%) 44,4 -41,4 87,3
EBITDA 35 14 37
EBITDA margin (%) 72,8 49,6 70,7
EBIT adj 29 6 27
EBIT adj margin (%) 61,1 22,2 51,8
Pretax profit 25 2 26
EPS rep 0,18 0,01 0,21
EPS growth (%) -28,3 -92,8 1483,8
EPS adj 0,18 0,01 0,21
DPS 0 0 0
EV/EBITDA (x) 7,8 10,8 3,6
EV/EBIT adj (x) 9,3 24,2 4,9
P/E (x) 14,7 103 6,5
P/E adj (x) 14,7 103 6,5
EV/sales (x) 5,7 5,4 2,5
FCF yield (%) 0,6 -4,3 12,3
Dividend yield (%) 0 0 0
Net IB debt/EBITDA 0,2 1,1 -0,1
USDm 2019 2020e 2021e
Sales 48 28 53
COGS -13 -14 -15
Gross profit 35 14 37
Other operating items 0 0 0
EBITDA 35 14 37
Depreciation on tangibles -6 -8 -10
Depreciation on intangibles 0 0 0
EBITA 29 6 27
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT 29 6 27
Other financial items 0 0 0
Net financial items -5 -4 -1
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 25 2 26
Tax -5 0 -4
Net profit 20 1 22
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 20 1 22
EPS 0,18 0,01 0,21
EPS Adj 0,18 0,01 0,21
Total extraordinary items after tax 0 0 0
Tax rate (%) -20,5 -25,2 -14,8
Gross margin (%) 72,8 49,6 70,7
EBITDA margin (%) 72,8 49,6 70,7
EBITA margin (%) 61,1 22,2 51,8
EBIT margin (%) 61,1 22,2 51,8
Pretax margin (%) 51,3 6,7 49,6
Net margin (%) 40,8 5 42,3
Growth rates Y/Y 2019 2020 2021
Sales growth (%) 44,4 -41,4 87,3
EBITDA growth (%) 56,5 -60,1 166,9
EBIT growth (%) 57,7 -78,7 336,9
Net profit growth (%) -23,4 -92,8 1483,8
EPS growth (%) -28,3 -92,8 1483,8
Profitability 2019 2020 2021
ROE (%) 25 1,8 27
ROE Adj (%) 25 1,8 27
ROCE (%) 26,7 5,6 26,8
ROCE Adj(%) 26,7 5,6 26,8
ROIC (%) 23,8 4,7 23,5
ROIC Adj (%) 23,8 4,7 23,5
Adj earnings numbers 2019 2020 2021
EBITDA Adj 35 14 37
EBITDA Adj margin (%) 72,8 49,6 70,7
EBITA Adj 29 6 27
EBITA Adj margin (%) 61,1 22,2 51,8
EBIT Adj 29 6 27
EBIT Adj margin (%) 61,1 22,2 51,8
Pretax profit Adj 25 2 26
Net profit Adj 20 1 22
Net profit to shareholders Adj 20 1 22
Net Adj margin (%) 40,8 5 42,3
USDm 2019 2020e 2021e
Short-term debt 0 0 0
Accounts payable 7 8 8
Other current liabilities 0 0 0
Total liabilities and equity 136 117 124
Net IB debt 8 15 -2
Net IB debt excl. pension debt 8 15 -2
Capital invested 106 95 103
Working capital 1 -3 -3
EV breakdown 2019 2020 2021
Market cap. diluted (m) 264 136 136
Net IB debt Adj 8 15 -2
Market value of minority 0 0 0
Reversal of shares and participations 0 0 0
Reversal of conv. debt assumed equity 0 0 0
EV 272 152 134
Capital efficiency (%) 2019 2020 2021
Total assets turnover (%) 37,7 22,3 43,9
Capital invested turnover (%) 49 28 53,4
Capital employed turnover (%) 44 25,7 51,7
Inventories / sales (%) 0 0 0
Customer advances / sales (%) 0 0 0
Payables / sales (%) 16,4 26,7 15,4
Working capital / sales (%) -0,1 -4,2 -6
Financial risk and debt service 2019 2020 2021
Net debt / equity (%) 9,3 21,6 -2,6
Net debt / market cap (%) 3,4 11,3 -1,8
Equity ratio (%) 64,6 61,3 75,8
Net IB debt adj. / equity (%) 9,3 21,6 -2,6
Current ratio (%) 424,3 226,3 211,8
EBITDA / net interest (%) 783,4 328,9 3268
Net IB debt / EBITDA (%) 23,3 110,4 -6,5
Interest cover (%) 656,7 147,1 2392,8
EBITDA 35 14 37
Net financial items -5 -4 -1
Paid tax -2 -1 0
Non-cash items 4 0 0
Cash flow before change in WC 32 9 36
Change in WC -2 4 0
Operating cash flow 30 13 36
CAPEX tangible fixed assets -28 -15 -18
CAPEX intangible fixed assets 0 0 0
Acquisitions and disposals 0 -4 0
Free cash flow 2 -6 18
Dividend paid 0 0 0
Share issues and buybacks 1 0 0
Other non cash items -1 1 0
Decrease in net IB debt 3 -7 18
Balance Sheet (USDm) 2019 2020 2021
Goodwill 0 0 0
Indefinite intangible assets 0 0 0
Definite intangible assets 0 0 0
Tangible fixed assets 97 93 101
Other fixed assets 8 5 5
Fixed assets 106 98 106
Inventories 0 0 0
Receivables 8 5 5
Other current assets 0 0 0
Cash and liquid assets 22 14 12
Total assets 136 117 124
Shareholders equity 88 71 94
Minority 0 0 0
Total equity 88 71 94
Long-term debt 31 29 10
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 0 0 4
Other long-term liabilities 10 8 8
USDm 2019 2020e 2021e
Shares outstanding adj. 99 101 101
Fully diluted shares Adj 99 101 101
EPS 0,18 0,01 0,21
Dividend per share Adj 0 0 0
EPS Adj 0,18 0,01 0,21
BVPS 0,88 0,71 0,93
BVPS Adj 0,88 0,71 0,93
Net IB debt / share 0,1 0,2 0
Share price 2,43 1,35 1,35
Market cap. (m) 241 136 136
Valuation 2019 2020 2021
P/E 14,7 103 6,5
EV/sales 5,66 5,38 2,53
EV/EBITDA 7,8 10,8 3,6
EV/EBITA 9,3 24,2 4,9
EV/EBIT 9,3 24,2 4,9
Dividend yield (%) 0 0 0
FCF yield (%) 0,6 -4,3 12,3
P/BVPS 3,01 1,91 1,45
P/BVPS Adj 3,01 1,91 1,45
P/E Adj 14,7 103 6,5
EV/EBITDA Adj 7,8 10,8 3,6
EV/EBITA Adj 9,3 24,2 4,9
EV/EBIT Adj 9,3 24,2 4,9
EV/cap. employed 2,3 1,5 1,3
Investment ratios 2019 2020 2021
Capex / sales 58,9 52,4 34,7
Capex / depreciation 499,6 191 183
Capex tangibles / tangible fixed assets 29,1 15,9 18,1
Capex intangibles / definite intangibles N/A N/A N/A
Depreciation on intangibles / definite intangibles N/A N/A N/A
Depreciation on tangibles / tangibles 5,8 8,3 9,9

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Main shareholders - Maha Energy

Main shareholders Share capital % Voting shares % Verified
Kvalitena 21.6 % 21.7 % 31 Dec 2018
Nerthus Investments LTD 11.9 % 12.6 % 30 Jun 2016
Avanza Pension 6.8 % 6.8 % 31 Mar 2020
Amha Swedish Exchange Co AB 7.2 % 6.6 % 31 Mar 2020
Jonas Lindvall 4.8 % 4.8 % 11 Oct 2019
Ronald Panchuk 3.0 % 3.0 % 31 Dec 2018
Scott Price 2.2 % 2.3 % 31 Dec 2016
Nordnet Pensionsförsäkring 1.5 % 1.5 % 31 Mar 2020
Talal Saif Al Subhi 1.2 % 1.2 % 31 Mar 2020
Harald Pousette 0.9 % 0.9 % 31 Mar 2020
Source: Holdings by Modular Finance AB

Insider list - Maha Energy

Name Quantity Code Date
Anders Ehrenblad - 1 480 SELL 1 Jun 2020
Anders Ehrenblad - 113 520 SELL 29 May 2020
Victoria Berg + 220 BUY 18 Dec 2019
Sven Harald Knut Jansson Pousette + 445 000 BUY 21 Oct 2019
Nicholas Walker - 70 000 SELL 11 Oct 2019
Jonas Lindvall - 95 000 SELL 11 Oct 2019
Jonas Lindvall - 75 000 SELL 10 Oct 2019
Jamie McKeown + 132 813 Redemp 6 Dec 2018
Kvalitena AB (publ) + 73 675 BUY 26 Oct 2018
Kvalitena AB (publ) + 26 325 BUY 25 Oct 2018

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