Vermilion Energy


CA$4988.1m market cap

CA$32.73 last close

Vermilion Energy is an international E&P with assets in Europe, North America and Australia. Management expects FY18 production to average 86-90kboed after incorporating the acquisition of Spartan.

Investment summary

Vermilion Energy’s defensive qualities include asset and commodity diversification, low financial leverage, high margins and low finding and development (F&D) costs. Management’s commitment to providing shareholders a sustainable dividend is supported by a deep and diverse portfolio of assets resilient to a volatile commodity price environment. A recycle ratio of over 2.5 times and the short-cycle nature of growth capex means spend can be rapidly diverted to projects that offer the highest returns or are curtailed. Our base case valuation stands at C$54.5/share. We believe dividend is fully covered (in addition to growth capex) at c 20% below our base case commodity price forecasts for FY19.

Y/E Dec
Revenue (C$m)
PBT (C$m)
EPS (c)
P/E (x)
P/CF (x)
2016A 829.0 362.0 (223.0) (210.4) N/A 7.4
2017A 1024.0 673.0 124.0 86.0 38.1 6.7
2018E 1535.0 693.0 11.0 (9.0) N/A 5.3
2019E 1857.0 1170.0 351.0 206.4 15.9 4.7
Last updated on 21/02/2019
Industry outlook

Vermilion’s operations are in OECD countries and predominantly onshore; political, operational and subsurface risk is well spread. Vermilion benefits from realisations based on a number of regional commodity prices including Brent, WTI crude and Henry Hub, TTF, NBP and AECO gas.

Last updated on 21/02/2019
Oil & gas
Share price graph
Balance sheet
Forecast net debt (C$m) 1706
Forecast gearing ratio (%) 69
Price performance
Actual (0.9) (2.1) (22.1)
Relative* (4.9) (7.6) (24.4)
52-week high/low C$48.9/C$27.0
*% relative to local index
Key management
Kyle Preston IR Director
Tony Marino President and CEO

You may also be interested in…