I have previously written about Geo Energy Resources ("GER") and their most recent half-year 2024 results announcement warrants further examination. At face value, the results appear positive. However, if we exclude "Other Gains", net income would have decreased to US$3.0m. This likely explains the low dividend declared as per the HY2024 report.
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| Geo Energy Resources Income Statement |
In my view, it is wise to remain cautious given the decline in coal prices from record highs in 2022 to earlier in 2023.
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| Coal Prices from 2020 till Aug 2024 / Source: tradingeconomics.com |
That said, acting on impulses to bail out of your position now would be short-sighted.
GER future looks promising due to the following reasons:
- Spike in Energy Demand for South East Asia ("SEA")- Source: 1, 2, 3, 4, 5, 6, 7
The rapid development of AI and data centers in SEA continues to drive up enormous energy needs to power computing infrastructure. As data centers require reliable electricity sources, governments may turn to lower-cost options like coal-fired power...
