CA - Vermilion Energy: Lots Of Free Cash Flow But Meager Capital Return To Shareholders

2024-03-06 12:23:06 ET

Summary

• VET's share price has been volatile, with dividends being cut and then recovered due to the impact of COVID-19 and energy price fluctuations.
• Despite promises of debt reduction and capital allocation to shareholders, VET has only returned 2.3% of cash generated to shareholders in the past three years.
• Share buybacks have not reduced the share count, and production levels have not increased despite significant capex investments.

Outline:

Vermilion Energy Inc. (VET) had a rollercoaster share price performance in the past years. First, they paid out high dividends over the years, but then they had to cut it as debt mounted. COVID-19 hit the company in the same way as it did to others - share prices crashed - then, share prices recovered driven by recovery of demand and an explosion of energy prices when the Ukraine war let TTF skyrocket....

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