N.B. Because of the Dividend Reinvestment Program, all per/share calculations will be out by roughly 2 or 3% by the end of 2013, even if revenue and capex numbers come in exactly as expected.


Two key numbers are funds flow/share @ $4.48

and dividend/share @ $2.76.

That means the projected dividend Payout Ratio is 61.6%.  

Dividend payout = $1.03 billion (372m shares X $2.76).

The projected corporate POR is 137%. {Add $1.35b capex to $1.03b dividends = $2.38b. Divide by $1.73b cash flow.}

The above number implies all the dividends will be paid completely in cash (and I should add a huge hat tip here to Tesh's post), further implying that the difference between income and outgo will be -$647m. However, there's a 60% uptake in the DRI Program, meaning $602m is "paid" in the form of shares.

$602m at today's share price (~$37) = 16.2m. This represents a dilution of 4.35%.


So, essentially, CPG will be paying out $45m dollars more than it takes during 2013, and it will be diluting itself to the tune of 16.2m shares. {Or, if the sp goes back up to, say, $42 by January, and that remains the average sp throughout 2013, then the dilution will be 14.3m shares, or 3.85%.}

The payoff for 2013 in the form of added boe/d is surprisingly low, compared to the fact that CPG added 32 or 33K boe/d from 2 years ago to the present time. This coming year, CPG will be adding 5,000 boe/d.

At $90/barrel, revenue will be $164.2 for 2013. At a $45/boe netback (the present case), CPG will clear $82.1 million.


These numbers do not point to anything spectacular. They do point pretty convincingly to stability and sustainability. I don't see a rise in the dividend this coming year, but I sure don't see a reduction in it either. A significant reduction, in fact, wouldn't look good to investors, and we'd see a drop in the sp and a drop in the DRIP participation rate. That would seriously diminish CPG's ability to make share-based acquisitions (the lower the sp, the lower the buying power), and it would be an added drain to cash on hand.

Just a guess here, but I think management has considered all of this in full depth a long time ago.