Original-Research: Saturn Oil & Gas Inc. - von GBC AG

Einstufung von GBC AG zu Saturn Oil & Gas Inc.

Unternehmen: Saturn Oil & Gas Inc.
ISIN: CA80412L1076

Anlass der Studie: Management Interview
Empfehlung: Management Interview
Letzte Ratingänderung:
Analyst: Julien Desrosiers

'Oxbow acquisition is transformative for Saturn and will transform us into
a leading producer and land holder throughout Saskatchewan '

GBC AG: Mr. Jeffrey, you have just announced a massive transaction. Can you
explain us how transformative this moment is for the future of the company?

John Jeffrey: The magnitude of this transaction is enormous and will
transform Saturn into a leading producer and land holder throughout
Saskatchewan. Our production will increase by over 2,000%, our land base
will increase 775%, and the company's PDP reserves will grow by more than
1,300% compared to our 2020 year end reserves.

GBC AG: Can you explain to us what led you to target these assets and how
long you worked on materialising this acquisition?

John Jeffrey: With the fluctuation of commodity prices Saturn pivoted in
2020 to pursue potential accretive acquisitions. Upon extensive review
our team identified an asset that had strong cashflow and provided Saturn
with the development upside needed to support our growth strategy. Along
with being light oil, the formations we will be targeting and producing
from are in the top 3 most economic plays in North America.

GBC AG: Such deal cost, close to a 100M CAD, requires important financing.
Can you explain us how you were able to generate value for shareholders by
limiting dilution while multiplying by 20 times the amount of barrel
produced per day?

John Jeffrey: We internally evaluated what would be best for shareholders
in the debt/equity ratio on this transaction. Obviously it was important
to Saturn to reward shareholders who've supported us through the years
while giving them the ability to further participate in the growth of our
company. We also wanted to ensure the fiscal strength of Saturn with
regards to its debt obligations. This asset has all senior debt related to
this transaction paid off within the next 24 months, which provides the
perfect balance to reward our shareholders in the future without being to

GBC AG: Should investors be worried about the debt following the

John Jeffrey: As previously mentioned the acquisition assets have the
ability to pay off all senior debt within the next 2 years. How does
Saturn ensure this? We are hedging up to 85% of our blowdown production
over the next 4 years. This ensures stakeholders certainty and limits
Saturn risk to commodity prices.

GBC AG: Such hedging allows you to focus your energy on operations. How do
you plan to integrate the assets in Saturn Oil & Gas and what is the

John Jeffrey: Our senior team has over 30 years experience working in the
operated fields we are acquiring. Current team has extensive experience on
these specific operated fields. This asset will be the foundation of the
new look Saturn, we will be focused on increasing growth while building on
Saturn's existing environmental, social and governance performance. We hope
to use this asset as a springboard to increase our production through more
acquisitions and development.

GBC AG: Saturn Oil & Gas will generate important amount of positive
cashflow after the closing of the transaction. How do you plan to use the
capital produced?

John Jeffrey: For the first year, we will be using the majority of the
capital to pay down our debt and to do a number of workovers and re-
activations on existing wells. This will increase production while spending
minimal capital and take advantage of neglected fields with large
potentials and upsides. As our debt is paid down we will start transi-
tioning to both organic growth and looking at new opportunities for
creative acquisitions.

GBC AG: In a previous interview we discussed of potential acquisition
opportunity when the barrel of oil was at 45$ USD. Now that the barrel is
over 65$ USD, do you believe that acquisition opportunities are still

John Jeffrey: I feel the downturn in the global economy and oil market has
left a lot of companies struggling and on the verge of collapse. With the
increase in oil price and by surviving the global downturn this gives
Saturn an enormous advantage to be able to take advantage of opportunities
that weren't existent pre-2020.

GBC AG: Where do you see the price of oil in the next 12, 24 and 26 months?

John Jeffrey: With more of the population getting vaccinated and
governments re-opening their countries and economies, I feel the global
demand on oil will continue to increase and reserves will decline. This
will have a positive effect on oil prices and hopefully we will be $70/bbl
by the end of the year.

GBC AG: Last but not least, what are your thoughts on the ESG movement in
the modern society?

John Jeffrey: I think it's great that companies are being held more
responsible for their environmental and social impact on today's society.
Saturn wants to be in the forefront of this change and we look forward to
and embrace the challenges that it takes to operate while reducing our
carbon footprint and increasing our position as a positive social leader.

GBC AG: John Jeffrey, thank you very much for the interview.

Die vollständige Analyse können Sie hier downloaden:

Kontakt für Rückfragen
Jörg Grunwald
Halderstraße 27
86150 Augsburg
0821 / 241133 0
Date (time) of completion of English version: 14/05/2021 (01:51 pm)
Date (time) of first distribution of English version: 14/05/2021 (02:30 pm)

-------------------übermittelt durch die EQS Group AG.-------------------

Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw.
Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatung
oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.

Event im Fokus

Termine 2021

10. Juni 2021:Fachkonferenz Immobilien

14./15. Juli 2021: Fachkonferenzen Beteiligungsgesellschaften & Consumer/Leisure

13./14. Oktober 2021: Fachkonferenzen Finanzdienstleistungen/Technologie

10./11. November 2021: Fachkonferenzen Software/IT & Branchenmix

„Je nach aktueller Covid-19 Situation und den bestehenden Vorschriften für Versammlungen entscheidet sich ca. 5 Wochen vor dem Termin, in welcher Form die Konferenzen stattfinden.“


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Nachdem die Vectron Systems AG bislang insbesondere Kassensysteme verkauft hat, wird nun das Digitalgeschäft stärker in den Fokus rücken. Damit sollen die wiederkehrenden Einnahmen und die Wertschöpfung je Kunde deutlich erhöht werden. Über Cloud-Module können die Kunden nun mehrere digitale Services, die sie sonst über viele Einzelverträge abdecken, direkt mit dem Erwerb der Vectron-Kassen über den Fachhandel dazubuchen. Wir haben die Vectron Systems AG im Rahmen eines DCF-Modells bewertet und ein Kursziel in Höhe von 21,15 € ermittelt und vergeben das Rating KAUFEN.

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