She purchased two drilling service companies at the height of the boom last year for a total of about $270 million of CLMT borrowed cash, and they are now practically worthless. Can we get back any of her exorbitant salary and stock options that were cashed in?
I couldn't bring up your spread sheets, but how about some color about how much you added for drop downs from Enervest and maybe some financial help from them in buying properties?
The conf call, if you can believe management which has become somewhat questionable of late--MEMP, ARP and LINE are good examples of stretching the truth) it made me believe that this is a steal at this price. It seems to be priced as if it had crude oil which it doesn't.
"CLMT - CLMT's distribution coverage has improved. However, the Dakota Prairie refinery is struggling in the short term to shift its diesel given the collapse in drilling in the Bakken. This will likely be a constraint through at least 2016 we think. However, other project EBITDA compensates somewhat, we lower our TP to $32/sh."
And they failed to talk about the money they threw away in the Oil Services companies that stole them blind.
Analyst: So when do you think you may start looking at raising distributions?
CLMT: We look at that all the time but think all the capital projects need to be completed first and after that, we'll see.
So, sometime in 2016 best case, but they really have no idea. With refineries minting money as fast as they can and the refineries of the majors supporting their bottom lines (look at Philips and Chevrons numbers), 1.3 coverage is embarrassing. Do you wonder why the price of CLMT units has taken the hits it has? PAA took it in the shorts when they said they may not raise distributions next year and they have a proven track record of being one of the best managed MLPs. So when CLMT says they have no idea re: what is happening with their company, it is not pretty.
CEO was right--share price is way too low but a large part of the under-price is based on the uncertainty about what the owners, Phillips and Spectra, may end up doing (and do to the small unit holders).
A huge number of smaller finance companies floating house loans to unqualified buyers did go under. Just like now in this space, a number of CEO's lied about how great they were doing and ended up very rich until their companies were out of business and the small shareholders took it in the shorts. Nobody went to jail which still amazes me.
Diesel is 20 cents less than regular gas in their marketing area, while it was at least 40 cents higher not that long ago and the refinery is all diesel. Their old president bet on the wrong side which helps explain why she's gone.
I am quite long CLMT and have been for years and have suffered through the mis-management by the owner's daughter, etc, hoping the new management would be better. Just voicing my frustrations--don't think this site has much to do with stocks going down because of negative comments here.