PGS (Sell, TP: NOK4.00) - Winter is always coming
Our investment case on PGS is unchanged following the Q3 results, with an equity issue of up to USD200m still probably required to deal with debt amortisations in H2 2023. Refinancing of its Term Loan B, which is trading at an implied yield of ~20%, seems inconceivable to us. With costs edging higher and soft order book trend, we would be hesitant to extrapolate the recent solid free cash flow into 2023e. We believe this cash flow has been mostly supported by abnormally high transfer fees and that underlying late sales have remained muted. We reiterate our SELL and NOK4 target price.Petroleum Geo-Services is engaged in providing geophysical services and oil and gas production services. As of Dec. 31, 2001, Co. operated six Ramform design vessels in its marine seismic data acquisition operations.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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