Excerpts from analyst's report

SP Angel adjusts REX International's value to $1.10

Analyst:  Zac Phillips

The summer has been an active time for the Company. The sale of its interest in Innis Trinity in Trinidad has sharpened the focus, while the acquisition of Rex Technology simplifies the structure significantly.

The recent fundraising, where it raised ~$75mm, provides it with sufficient cash resources to execute its near to medium term strategy. 

manslidgren.8.13aMans Lidgren, CEO of Rex International.
NextInsight file photo.
Technology Ownership Simplifies the Offering
One of Rex’s key differentiating factors was its application of Rex Virtual Drilling (“RVD”) in the exploration phase, which it had exclusive access to, providing certain shareholder interests are maintained, etc.

Consequently, news of the acquisition of the technology simplifies this area significantly, and eliminates what hitherto has been an area of confusion for investors.
Fundraising Provides Balance Sheet Strength and Corporate Flexibility
The recent fundraising is timely (see below) and provides two things to the Company, namely:

(i) balance sheet strength, which given that the funding markets are not fully open, a dollar on the balance sheet is worth more than a dollar to third parties outside the Company; and 

(ii) corporate flexibility, whether it is in the shape of activity on their own acreage, or farming in to a third party’s acreage, it provides them with the ability to pick and choose, and be more aggressive in their pursuit of terms, which is good for shareholders.

Activity Increasing & More Focused
As we enter the closing stages of 2014, the drilling programme starts to accelerate, with the focal points (for us) being Norway and the Omani appraisal well. However, this is not the only activity, as there will be a significant amount of activity right across the portfolio, in all their jurisdictions.
Valuation – $1,095 (S$1.10)
While RIH’s asset value has increased overall to $1,095mm, the per share valuation has been adjusted to S$1.10, which reflects the increased number of shares in issue. We are reiterating our BUY recommendation, but adjusting our target price to S$1.10.

Recent story:  REX target $1.27; VALUETRONICS attractive at 3.3X PE

Share Prices

Counter NameLastChange
AEM Holdings4.1700.050
Avi-Tech Electronics0.3950.005
China Sunsine0.530-
Food Empire0.820-
Fortress Minerals0.4000.005
Geo Energy Res0.385-
Golden Energy0.425-
GSS Energy0.0790.001
ISDN Holdings0.6450.010
IX Biopharma0.2400.005
Jiutian Chemical0.0880.001
KSH Holdings0.360-
Leader Env0.076-0.002
Medtecs Intl0.380-
Moya Asia0.066-0.002
Nordic Group0.365-
Oxley Holdings0.205-
REX International0.3600.015
Sinostar PEC0.330-0.010
Southern Alliance Mining0.800-0.005
Sri Trang Agro1.360-0.040
Straco Corp.0.510-
Sunpower Group0.570-0.015
The Trendlines0.1050.001
Totm Technologies0.205-
UG Healthcare0.345-
Uni-Asia Group1.4500.050
Wilmar Intl4.370-0.010
Yangzijiang Shipbldg1.4000.010

NextInsight RSS

rss_2 NextInsight - Latest News

Online Now

We have 1425 guests and no members online