Lightstream Resources Ltd. (LSTMF)

[dan_s]

Lightstream Resources, Ltd. is now trading on the pink sheets as LSTMF. This company is in our High Yield Income Portfolio.

It used to be PetroBakken. The name change is to better reflect its growth in the Cardium play.

Current dividend yield is 12.5%. Dividends are paid monthly. As long as oil stays over $80/bbl the dividends should be secure. Production should dip slightly in Q2, then ramp up into year-end. Cardium was very wet in Q2 causing delays in completions operations.

You can find my forecast model under the Watch List Tab.

[k1f]

Dan, Do you suppose LSTMF's balance sheet (debt) is what's keeping it in the doghouse? If they make production
guidance, they'd seem to be one of the better buys out there.

[dan_s]

Yes, the company's debt level is high and worries a lot of investors. However, the company has publicly stated that they are committed to paying the dividend. Based on my forecast model, as long as WTI stays over $80/bbl the dividend should be safe.

Note that more than half of the shareholders take dividends in the form of more shares, so the dividends are not a big strain on the cash flows.

Lightstream is expected to report a slight dip in production for the 2nd quarter due to weather related delays. The Cardium is very wet every Spring. They will complete a lot of wells during the 3rd quarter and production should increase steadily into year-end.

[cviller]

Taking dividends in the form of shares means increasing share count, means dilution.

[setliff]

its possible they are in the float held by the corp treasury? anybody know?

[dan_s]

The common stock outstanding went down from Q4 to Q1. They have 192.8 million shares outstanding. Shares issued as dividends are not very dilutive. I have updated my forecast model and posted it under the Watch List Tab. At the current oil prices, Lightstream is generating more than enough cash flow from operations to cover their capital program and pay dividends. Dividends are secure unless WTI dips below $80/bbl and stays there. I don't see that happening during the next six months, beyond that who knows. - Dan
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CALGARY, ALBERTA--(Marketwired - Jun 17, 2013) - Lightstream Resources Ltd. ("Lightstream") (LTS.TO) is pleased to announce that our cash dividend for the month of June will be paid on July 15, 2013 to all Lightstream shareholders of record on June 30, 2013. The June dividend will be $0.08 per Lightstream share. The ex-dividend date is June 26, 2013.

Lightstream is pleased to provide two convenient cost-effective methods for shareholders to increase their investment in Lightstream. The Share Dividend Plan ("SDP") is now available to most shareholders, enabling shareholders to receive dividends in the form of common shares at a 5% discount to the average market price. While similar to our Dividend Reinvestment Plan ("DRIP"), the SDP has certain tax attributes which may be more attractive to some shareholders. The DRIP remains available to Canadian shareholders, enabling such shareholders to reinvest their monthly cash dividend to acquire additional common shares at a 5% discount to the average market price. For further information regarding our SDP and DRIP, please visit Lightstream's website at www.lightstreamresources.com or contact Olympia Trust Company at 403-668-8887, toll free at 1-800-727-4493 or via email at corporateactions@olympiatrust.com.