CHI - Channel Infrastructure Ltd (NZR)

[Crackity]

3 of my favorite things Snaps!

[Hoop]

We just hit $3 Hoop, not as long a wait as you thought!

Hmmm... I expected it to touch the resistance level then have a breather..a technical theoretical viewpoint.

From this Technical theoretical point of view I am focusing on just 2 technical things..

1..the target price (TP) around the 2.95 area...where some shorter term traders may sell to realise a quick profit and stall the upward trend of the shareprice..... remember the TP is not a resistance point its only a price point that is reached 70% of the time after a breakout...you could have 60% at a higher price etc...it's a statistical point of view..
2..A very old resistance area at around $3.00 which is also a psychological price point for some investors ...Chartists assume Mr Market has a long memory and expect prices to hestitate around resistance levels, but we don't lose any sleep if the shareprice behaves differently and rockets on upwards..we just accept that the resistance point has lost strength or buyer demand is too strong or both (in theory S&R areas wax and wane in strength. In practice investors watch the depth data of a share to see the variable movements of the degree of strength of each support and resistance points...some S&R points die, other S&R price points are born).

The NZR depth table (not very accurate concerning Market strength after the market is closed and being a friday close as well) shows no visible resistance at 3.00 area and a small support at 2.75...On the chart this 2.75 area was the recent resistance line break that reforms as a support line so Theory (Chart) and Practice agree..

When I use depth tables I think 3D ..a fluid motion with price/volume bulges (S&P points) ebbing and flowing every single moment of the trading day and when the bulge ebbs away (less selling pressure) there's an opportunity for the price to break through without added demand pressure...Looking at the Friday's close depth and not seeing any such bulge at $3.00 could give the NZR price an opportunity to break through past $3.00 theoretical (charted) resistance to create a $3.00 support without much increase to buyer demand.

Lets watch the depth at work next Monday and see what happens...

[Sideshow Bob]

And us new shareholders ex Chevrons sell down thank you for it!!

thank you you again Chevron!

[bull....]

Asia oil refining margins hit 2015 low, Mideast supply to drag http://www.cnbc.com/id/102805613

Asia oil refining margins hit 2015 low, Mideast supply to drag
Thursday, 2 July 2015 10:03 PM ET
SINGAPORE, July 2- Rallying oil refining margins have ground to a halt in Asia. Currently at a 2015 low, they could drop another 20-30 percent this quarter, led by declining profits in diesel as supply from the Middle East adds to a global glut. But they have almost halved this week to $5.60 with supply of refined products from traditional importers in the Middle East...
Source: Reuters | By: Jessica Jaganathan and Seng Li Peng

[golden city]

that is no good..down half margin

[bull....]

Guess the main point from margins falling is that debt will take longer to pay off which means dividends wont occur to longer in the future. see there profit matrix at an exchange rate of 65c and margins at $6 the npat halves from where we were 2 weeks ago - the point being margins have a much higher weighting than the exchange rate.

NZR did state at there annual meeting that they were forecasting weaker margins in the second half so at this early stage they may be right also they stated 2018 as likely for divs to resume - guess the high margins in the 1st half got us all excited and looked like we could bring all those forecast forward. anyway like ya still say snaps no need to panic yet the margins change everyday lets wait and see what the trend in margins does in the months ahead.

[cdonald]

Asia oil refining margins hit 2015 low, Mideast supply to drag http://www.cnbc.com/id/102805613

Asia oil refining margins hit 2015 low, Mideast supply to drag
Thursday, 2 July 2015 10:03 PM ET
SINGAPORE, July 2- Rallying oil refining margins have ground to a halt in Asia. Currently at a 2015 low, they could drop another 20-30 percent this quarter, led by declining profits in diesel as supply from the Middle East adds to a global glut. But they have almost halved this week to $5.60 with supply of refined products from traditional importers in the Middle East...
Source: Reuters | By: Jessica Jaganathan and Seng Li Peng

Just to add some NZR context onto this. Singapore complex margin of $5.60 USD = NZR margin of around $8.60 per bbl. In jan/feb we ran at CAP at an average exchange rate of .75 so in NZD terms the margin in JAN FEB was $12NZD/bbl. If we convert the $8.60 using May/Jun avg of .72 we get $11.95NZD/bbl so not that different. If we convert it onto Jul exchange rate it puts it up around $13NZD/bbl.

Other thing to consider is NZR was not the only one to delay shutdown, a lot of the refinerys around the area are looking to do shut downs now that the margins have eased a bit which will then put upward pressure back onto products again. Most important thing to remember though is the margins are averaged out over a 2 month period so day to day swings, whilst interesting, are somewhat misleading.

Project start up in November will also add another $1USD to margins so in theory Singapore complex margins can fall to around $4 after the project is done as the NZR uplift should make up the difference. Anything above $9 goes back to the oil companies.

[bull....]

Just to add some NZR context onto this. Singapore complex margin of $5.60 USD = NZR margin of around $8.60 per bbl. In jan/feb we ran at CAP at an average exchange rate of .75 so in NZD terms the margin in JAN FEB was $12NZD/bbl. If we convert the $8.60 using May/Jun avg of .72 we get $11.95NZD/bbl so not that different. If we convert it onto Jul exchange rate it puts it up around $13NZD/bbl.

Other thing to consider is NZR was not the only one to delay shutdown, a lot of the refinerys around the area are looking to do shut downs now that the margins have eased a bit which will then put upward pressure back onto products again. Most important thing to remember though is the margins are averaged out over a 2 month period so day to day swings, whilst interesting, are somewhat misleading.

Project start up in November will also add another $1USD to margins so in theory Singapore complex margins can fall to around $4 after the project is done as the NZR uplift should make up the difference. Anything above $9 goes back to the oil companies.

Hi I might be wrong but I thought this was how it was worked out too, but when I compared the historical figures which they used in the article ( I got the data from a source ) against announcements by NZR it never matched the quoted figures from Singapore the analysis of comparison seemed to show a difference of $2 from stated Singapore complex margin so I worked out current of there quoted 5.60 - 2 = 3.60 + nzr margin of 3 to 4 = 7.6 us so get slightly less than you - anyway my point was mainly divs will be delayed by a margin decline

[dodgy]

Fairly broad and a little misleading this statement bull........with such a favorable kiwi $ and the margins running at the highest levels for sometime I would of thought margins would have to decrease significantly and for an extended period of time for divies payments to be pushed out further than year end 2015. This would not even take into account the uplift in profit from the new plant.

Good afternoon Snapiti and all
You know where I stand on divs and S/P.
Regards
-dodgy (owner/shareholder and expectant)

[bull....]

Fairly broad and a little misleading this statement bull........with such a favorable kiwi $ and the margins running at the highest levels for sometime I would of thought margins would have to decrease significantly and for an extended period of time for divies payments to be pushed out further than year end 2015. This would not even take into account the uplift in profit from the new plant.

don't think its misleading you know the analyst report profit matrix shows at a margin of 6usd and exchange rate of 65c it is 70mil npat at current margin of 9usd and 65c its 165m so if the current decline in margins remains that is a huge decrease in profits still profitable company though but there stated divs is when gearing is down to 10-20% so less profit longer to reach the target - you have to roll with changing environment and adjust your forecasts
the new plant adds less than 1 dollar also lower oil price means less margin from new plant as shown in there presentations

anyway who knows price may keep going up suits me im still got some but rolling my expectations back on when divs might come now if low margin remains