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Petrofac Limited (PFC)

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Bouleversee
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Re: Petrofac ( SFO)

#200664

Postby Bouleversee » February 11th, 2019, 7:45 pm

BristolDave wrote:I think in the end Tesco only paid out £101m if I remember correctly which was a lot less than originally claimed, don't know how to check this though and I may be wrong. I have just checked the short positions on short interest tracker and Petrofac are 6.18% shorted as of today against Marks and Spencer at 11% for example so I am not sure even the institutions believe that this will go much lower. We will wait and see what happens this week.

Disclosure: - I hold Petrofac having bought after the drop 18 months ago and maybe considering buying a few more if the yield increases further :lol:


However much/little, as someone who has 2 holdings (ISA and certificated) I , in however small a way, helped to pay for that. I think it was the same with Lloyds. I really can't remember if I would have qualified to join the action in either case, but it didn't seem right to do so and that I would have been suing myself. Perhaps I missed out.

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Re: Petrofac ( SFO)

#200676

Postby BristolDave » February 11th, 2019, 8:49 pm

I agree with you and also didn't claim for my Tesco shares. What I was trying to say is that the legal action may not come to much and Petrofac seem to be taking a stance against it. My understanding is that the claimants will need to prove that the sales manager acted with the knowledge and approval of the company so there is no certainty that it will succeed and even if it does the final settlement is likely (hopefully) to be a lot less than the £400m being claimed so unlikely to affect the company too much.

The main thing to watch in my opinion is reputational damage which would affect the companies ability to win contracts going forwards. This doesn't seem to have been the case so far and I personally believe there is still a good investment case for the company - but you have to make your own decision what to do.

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Re: Petrofac ( SFO)

#200677

Postby Bouleversee » February 11th, 2019, 8:56 pm

Understood and am inclined to agree and sit tight, as I did with CLLN & IRV :cry:

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Re: Petrofac ( SFO)

#200697

Postby BristolDave » February 11th, 2019, 10:18 pm

I also lost money on Carillion mainly due to doing nothing and hoping for a recovery, learned a valuable lesson there !. But I don't think there is any suggestion of false accounting with Petrofac and the owners the Asfari family have major skin in the game holding over 18% of the company. My understanding is that they are paid with the dividends so have a major interest in keeping the company on a sound footing.

I think this situation is more similar to Rolls Royce and their Saudi Bribe scandal, I also seem to recall there was a similar situation with a BAE director and the middle East a while back. It hasn't seriously affected either company as far as I can see and I hold both. I am also in sales and unfortunately this is par for the course with doing business with the Middle East and parts of Eastern Europe. The trick is to distance yourself through intermediate companies and paying commissions :roll: , but without condoning it in any way that's the way you do business in these areas of the world.

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Re: Petrofac ( SFO)

#200852

Postby Clitheroekid » February 12th, 2019, 3:41 pm

Bouleversee wrote:I can never get my head round this sort of legal action.

That's because such litigation is primarily for the benefit of the lawyers who promote such action. It's one of the many undesirable imports from the US, where such class actions are a thriving industry. Fortunately, English law is less generous to such claimants than many US laws.

Nevertheless, I personally see most such actions as unethical, as they usually result in one small group of shareholders (and their lawyers) being enriched by extorting money from the large majority of shareholders who aren't in the group.

However, in purely practical terms I can't see it representing any significant threat to a company the size of PFC. They will almost certainly negotiate a nuisance settlement of maybe £50m - £100m, which is in reality neither here nor there.

Likewise, I view the reaction to David Lufkin's guilty plea as overdone. For a start, neither the company itself nor any of its current employees have even been charged, let alone convicted, and the SFO's track record is pretty poor in similar cases.

There's also been talk of reputational damage if there are further convictions, but again I suspect the harm that would result from such convictions has been overestimated. It's an unfortunate fact of life that nearly all companies that trade in sunny places full of shady people have to indulge in a certain degree of corruption simply to keep trading there. I'm quite sure that people in the oil industry are far more concerned about whether the prospective partner can do the job competently and at a decent price than whether they've greased a few palms here or there.

In the meantime, the yield now appears to be over 7%, with dividend cover of about 2.7.

So although it's certainly not a widows and orphans share I've concluded that at around £3.75 the upside outweighs the downside and it's too good a bargain to be missed. To be perfectly honest, I'll be happy to sell if, as I anticipate, the price makes a significant short term recovery, but if not I'll be equally happy to hold on a long term basis, as I think that yield looks pretty safe for the foreseeable future.

monabri
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Re: Petrofac ( SFO)

#200908

Postby monabri » February 12th, 2019, 6:54 pm

Reputational damage? Nah! ( proven not to be so....look at the history in the last 18 months).

daveh
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Re: Petrofac ( SFO)

#201117

Postby daveh » February 13th, 2019, 5:14 pm

I topped up with a very small purchase today using some accumulated divis as it was a cheap dealing day. Unfortunately I was 2 minutes too late and missed the cheap dealing and didn't notice when I pressed the accept deal button - bother!.

monabri
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Re: Petrofac ( SFO)

#201634

Postby monabri » February 15th, 2019, 6:53 pm

I see that visible shorting levels have reduced back down to 5.7%.

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Re: Petrofac (PFC)

#203252

Postby spiderbill » February 22nd, 2019, 5:08 pm

Seems the SFO is abandoning its cases against Rolls-Royce and GSK.

https://uk.finance.yahoo.com/news/uks-serious-fraud-office-drops-114904125.html

Not sure if that's good or bad news for the Petrofac case.

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Re: Petrofac (PFC)

#203263

Postby monabri » February 22nd, 2019, 5:43 pm

The investigation into PFC will be completely independent from RR/GSK and I doubt anything can be read across other than the timescales these investigations can take. Until resolved, PFC will be under a cloud from a market sentiment point of view (with the share price being punished for the same offence twice). One hopes that they continue to be able to pay a dividend and that it isn't too big a holding/contributor to income in ones p/f.

Interesting that the market response for GSK was .... 'muted' (ditto - the response for RR Holdings). Let's hope the PFC price responds more favourably when this issue is eventually dealt with.

(disc. I hold shares in PFC - avg price £6.29)

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Re: Petrofac (PFC)

#204483

Postby daveh » February 28th, 2019, 8:25 am

Full year results are being discussed here:
viewtopic.php?f=15&t=16496

Clitheroekid
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Re: Petrofac ( SFO)

#204585

Postby Clitheroekid » February 28th, 2019, 3:56 pm

Clitheroekid wrote:I've concluded that at around £3.75 the upside outweighs the downside and it's too good a bargain to be missed. To be perfectly honest, I'll be happy to sell if, as I anticipate, the price makes a significant short term recovery, but if not I'll be equally happy to hold on a long term basis, as I think that yield looks pretty safe for the foreseeable future.

And now it's the age old dilemma - whether to cash in or not.

They're now up to £4.22, which is a rise of 13% in just two weeks, and in cash terms that's a very substantial profit. So the rational me would sell and be grateful. But I thought that yesterday, when they were trading at around £4.10.

I've been caught out before in being greedy and hanging on for more, only to see the price suddenly reverse. In that situation I often convince myself it's just a temporary blip, so I've hung on, sometimes to see the price move well below the purchase price. My short term trade then becomes a long term buy and hold, justified only by a good yield - my insurance policy against the original trade not working out.

Ideally I'd place a trailing stop loss, thereby taking the emotion out of the process, but my brokers, Interactive Investor, don't offer such a facility. And the problem with an ordinary stop loss is that on a volatile share like PFC it can be triggered by a relatively normal blip, so that to be safe it has to be set well below the current price.

I know many people say sell half and bank the profit, but that always seems to me to be the worst of both options. If it falls I'd wish I'd sold them all, and if it rises I'd kick myself for having sold any.

Still, it's not a bad dilemma to have. PFC have been a fantastic trading share for me over the past couple of years, with my initial investment more than doubled, and long may it continue! :D

Bouleversee
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Re: Petrofac (PFC)

#204589

Postby Bouleversee » February 28th, 2019, 4:20 pm

And they have been a pain in the neck for those of us who don't trade but buy for the long term. I was making a good profit at one point but no longer. :( Still, I continue to get good dividends. :) Let's hope that with a new head the SFO will get its finger out and come to a decision one way or the other and put us out of our misery.

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Re: Petrofac (PFC)

#204592

Postby kempiejon » February 28th, 2019, 4:31 pm

And I have added some more. last time they dipped below £4 I bought in but didn't trade when they got to what £7? At this price I like the risk enough to add again. As boulversee there's good income.

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Re: Petrofac limited (PFC)

#204805

Postby monabri » March 1st, 2019, 12:46 pm


Clitheroekid
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Re: Petrofac limited (PFC)

#205706

Postby Clitheroekid » March 5th, 2019, 3:28 pm

PFC really is the gift that keeps on giving! They're now up to £4.54, which is an increase of over 20% in less than a month.

In cash terms that represents a large profit, but I just haven't been able to bring myself to press the sell button, as they appear to be on a very steady upwards trajectory.

But I'm going to Oman for a few days tomorrow, and I rather doubt that most camels are wi-fi equipped. So I think I really have to be sensible and set a stop loss, just in case there's some unpleasant event in my absence and I return to find they're back to £3.80, which would make it an expensive holiday.

But at what price to set the SL? While it's on this path I'm tempted to set it pretty close, say around the £4.50 mark, but I'm worried that a temporary blip would trigger a sale before it continues majestically upwards.

The trader's dilemma ... ;)

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Re: Petrofac limited (PFC)

#206006

Postby Clitheroekid » March 6th, 2019, 3:55 pm

Well I finally decided that a bird in the hand etc, and sold out at £4.62. They've had a tremendous run over the past three weeks, and an actual cash profit is always preferable to a theoretical one. I also thought that I don't want to be constantly checking (or more likely trying to check) the price while on holiday.

Of course, this probably means they will now soar to £6+ and I hope they do for the loyal long-term holders. But I'm also hoping on a purely selfish basis that the SFO will make another earth-shaking pronouncement, whereupon I'll be there waiting to rinse and repeat! ;)

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Re: Petrofac limited (PFC)

#206083

Postby Wizard » March 6th, 2019, 11:22 pm

I think this thread is a cracking example of the benefits of this board. Long term holders and those looking for short term wins can discuss a share without either being shut down for being off topic. Bravo mods, a great decision.

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Petrofac

#207421

Postby Bouleversee » March 13th, 2019, 1:43 pm

I see from an article in The Times today that Asfari has lost his appeal against the fine for insider trading that was imposed by Italy's financial regulator but he intends to appeal to a higher court. I don't know whether we should pay any attention to this. I gather he expected to get off on a technicality (not being served notice of the charges and so did not have a chance to defend himself) but of course he denies it anyway.

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Re: Petrofac

#207458

Postby monabri » March 13th, 2019, 4:11 pm

Bouleversee wrote:I see from an article in The Times today that Asfari has lost his appeal against the fine for insider trading that was imposed by Italy's financial regulator but he intends to appeal to a higher court. I don't know whether we should pay any attention to this. I gather he expected to get off on a technicality (not being served notice of the charges and so did not have a chance to defend himself) but of course he denies it anyway.



When his villa was first confiscated, the news hit the PFC share price negatively.

Maybe it was the $1 billion contract awarded today that has over ridden the negative news ?

https://www.londonstockexchange.com/exc ... 01174.html


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