Chariot Oil & Gas (CHAR) had a tough year. It drilled two high-risk exploration wells offshore Namibia - formerly considered one of East Africa's most exciting oil and gas frontiers - but both ended in disappointment. Unforgiving investors consequently sold off the company's shares, to the point that the market capitalisation of Chariot is now at an 18 per cent discount to its estimated cash holdings of $112m (£70m).
But the lack of exploration success doesn’t seem to have deterred Chariot’s chief executive, Paul Welch, whose previous experience includes 12 years at Shell as well as several roles with successful independents such as Hunt Oil. Mr Welch bought 200,000 shares of the company last week at an average of 29.2p a share, increasing his holding to 500,000 shares.
Chariot has recently diversified its licence portfolio to include attractive acreage offshore Mauritania and Morocco, despite still holding the second-largest acreage position offshore Namibia. Indeed, even after subtracting the prospective resources from the two drilling failures, Chariot still has prospects in other geologically distinct basins offshore Namibia that could contain a total of 10.65bn barrels of oil.
IC view: Trading for less than cash, the market is currently ascribing a negative value to Chariot’s Namibian, Mauritanian and Moroccan licences. This grossly underestimates Chariot’s exploration prospects, yet the problem is a lack of significant near-term catalysts. As such, the shares rate no better than a hold.
Don’t follow dotDigital’s directors
Aim-traded dotDigital (DOTD) provides intuitive software as a service and managed services to digital marketing professionals. Two of its directors, Ian Taylor and Simon Bird, sold 8m shares between them on 26 October, pocketing £520,000 each. The company’s chief executive and chief financial officer, Peter Simmonds, also sold 4m shares through his self-invested personal pension (Sipp).
Shareholders shouldn’t read too much into these sale transactions, despite their size, because the shares were sold for a specific reason. After a good set of annual results and a round of investor presentations 12m shares were sold: “to partially satisfy significant demand for 22m shares from a major institution”.
dotDigital’s share price has risen 90 per cent over the past 12 months and these directors managed to sell almost at the top. The company is cash rich, has £4.02m on its balance sheet and its revenue is up 34 per cent on the year.
Alkane Chairman in buying spree
Following his recent appointment as non-executive chairman of Alkane Energy (ALK), Roger McDowell has been in acquisitive mode. Since the start of October he has amassed a total of 765,000 shares in the methane power plant producer for an aggregate outlay of £164,951.
The latest deal of three - an acquisition of 265,000 shares - was completed on 24 October for 22.67p a share. It was important for Alkane to secure the services of someone with a broad experience of helping guide businesses through their development stage, and the new chairman has decades of experience in this regard, reflected by his board activities at the likes of Avingtrans, Ultimate Finance Group, IS Solutions, Swallowfield and Augean.
The share price of Alkane is now up by a third on our November 2011 buy advice, helped along in part by a recent £1.6m gas-to-power contract, which forms part of the £21m Dagenham waste-to-power facility. Alkane was subcontracted by TEG Group to provide the gas-to-power capability at the plant and it should complete the contract by the end of 2013. In the meantime, the new chairman will be helping the company to make commercial capital from the increasing imperative for the UK to reduce its output of green house gases.
|Company||Director||Date||No. of shares||Price (p)||Value (£)|
|Alkane Energy||Roger McDowell (ch)||24 Oct 12||265,000||22.67||60,076|
|AquaSource||Oliver Spurling||24 Oct 12||1,029,530||1.5||15,443|
|Ariana Resources||Michael de Villiers||29 Oct 12||250,000||1.6||4,000|
|AstraZeneca||Dame Nancy Rothwell||26 Oct 12||275||2876.5||7,910|
|Aurora Investment Trust||MJ Barstow||30 Oct 12||20,000||146||29,200|
|Avesco||Richard Murray||23 Oct 12||10,000||159||15,900|
|Avesco||Richard Murray||23 Oct 12||10,000||160||16,000|
|BlackRock North American Income||Andrew Irvine||24 Oct 12||20,000||100||20,000|
|BlackRock North American Income||Simon Miller||24 Oct 12||20,000||100||20,000|
|BlackRock North American Income||Christopher Casey||24 Oct 12||10,000||100||10,000|
|Chariot Oil & Gas||Paul Welch (ceo)||25 Oct 12||200,000||29.2||58,400|
|CLS||John Whiteley (cfo)||24 Oct 12||2,227||715.5||15,934|
|Debenhams||Simon Herrick||25 Oct 12||8,650||113.856||9,849|
|Devro||Paul Neep||23 Oct 12||3,200||320||10,240|
|Finsbury Growth & Income Trust||Nick Train||30 Oct 12||7,000||374.25||26,198|
|Home Retail||Mike Darcey||25 Oct 12||6,104||105.2132||6,422|
|Home Retail||Ian Dusrant||25 Oct 12||7,381||105.2132||7,766|
|Home Retail||Cath Keers||25 Oct 12||7,381||105.2132||7,766|
|Hydrodec||Colin Moynihan (ch)||24 Oct 12||2,210,326||9||198,929|
|Hydrodec||Andrew Black||30 Oct 12||5,000,000||9.895||494,750|
|JPMorgan American Investment Trust||Simon Bragg||26 Oct 12||1,000||924.15||9,242|
|Kingswalk Investments||Rod Gentry||23 Oct 12||714,285||0.58||4,143|
|Lowland Investment||Robert Robertson||30 Oct 12||6,000||983||58,980|
|Maven Income and Growth VCT 3||William Nixon||24 Oct 12||15,343||68.5||10,510|
|MBL||Peter Cowgill (ch)||26 Oct 12||200,000||7||14,000|
|Parallel Media||David Ciclitira (ch)||30 Oct 12||62,500||14.92||9,325|
|Pathfinder Minerals||John McKeon (ch)||26 Oct 12||1,000,000||1.9||19,000|
|Rio Tinto||Richard Goodmanson||29 Oct 12||235||3077.96||7,233|
|Rio Tinto||Ann Godbehere||29 Oct 12||31||3077.96||954|
|Rio Tinto||Paul Tellier||29 Oct 12||205||3077.96||6,310|
|Sound Oil||James Parsons (ceo)||24 Oct 12||425,000||118||501,500|
|Company||Director||Date||No. of shares||Price (p)||Value (£)|
|Amiad Water Systems||Simon Olswang||25 Oct 12||10,000||305||30,500|
|Amiad Water Systems||Simon Olswang||26 Oct 12||20,000||304||60,800|
|dotDigital||Ian Taylor||26 Oct 12||4,000,000||13||520,000|
|dotDigital||Simon Bird||26 Oct 12||4,000,000||13||520,000|
|MP Evans||JD Shaw||22 Oct 12||5,000||495||24,750|
|MP Evans||JD Shaw||23 Oct 12||5,000||495||24,750|
Table compiled by Robert Ansted.
Key to abbreviations: ch = chairman; ce = chief executive; cfo = chief financial officer; fd = finance director; coo = chief operating officer; cs =company secretary; md = managing director