Today, Blue Dolphin Energy Company, a crude petroleum and natural gas firm, disclosed that its subsidiaries, Lazarus Energy, LLC and Lazarus Refining & Marketing, LLC, have obtained waivers for all covenant violations related to their loan agreements for the fiscal years 2021, 2022, and 2023.
The confirmation of these waivers was issued by Veritex (NASDAQ:VBTX) Community Bank on July 2, 2024, and the U.S. Department of Agriculture (USDA) sanctioned the waivers on June 25, 2024.
The loans in question, originally amounting to $25 million for Lazarus Energy and $10 million for Lazarus Refining & Marketing, are backed by the USDA's Rural Development Business & Industry loan program. This development follows a request by Veritex to the USDA for covenant violation waivers, which the bank submitted on April 18, 2024.
The announcement was made in a filing with the Securities and Exchange Commission (SEC) on Monday, with Blue Dolphin Energy, headquartered in Houston, Texas, confirming the news. The company, traded under the ticker OTCQX:BDCO, is incorporated in Delaware and has been previously known as Mustang Resources Corp and ZIM Energy Corp.
The SEC filing did not disclose specific details regarding the nature of the covenant violations or the terms of the waivers. However, the waivers indicate that both Lazarus Energy and Lazarus Refining & Marketing have been relieved from meeting certain financial or operational metrics stipulated in their loan agreements for the specified period.
Blue Dolphin Energy's CEO, President, Treasurer, and Secretary, Jonathan P. Carroll, signed off on the SEC filing, affirming the company's compliance with the regulatory requirements of the SEC.
This statement is based on a press release and provides an update on Blue Dolphin Energy's financial arrangements, which may be of interest to investors and stakeholders monitoring the company's fiscal health and compliance.
InvestingPro Insights
In light of Blue Dolphin Energy Company's recent financial developments, it's pertinent to consider the company's market performance and valuation metrics. Blue Dolphin, with a market capitalization of $61.93 million, is trading at a notably low P/E ratio of 2.97 as of the last twelve months leading up to Q1 2024. This is further adjusted to a P/E ratio of 2.79, suggesting a potentially undervalued stock in comparison to earnings. Moreover, the company has demonstrated a strong return on assets, reaching 20.27% over the same period, which is a testament to its efficiency in utilizing its assets to generate profits.
However, investors should be aware of the significant revenue decline Blue Dolphin has faced, with a -24.94% change in the last twelve months as of Q1 2024. This trend is consistent with the quarterly figures, showing a -21.98% decrease in revenue in Q1 2024. Additionally, the price of Blue Dolphin's stock has experienced a considerable drop of -31.12% over the last three months, which InvestingPro Tips indicate may be a reflection of the stock's tendency to move inversely to market trends.
For investors interested in further analysis and metrics, InvestingPro provides additional insights, including a fair value estimation of $4.51 for Blue Dolphin's stock and a detailed look at the company's gross profit margins, which have been weak at 9.72%. There are 6 more InvestingPro Tips available that could provide further clarity on Blue Dolphin Energy's financial outlook. To access these tips and enhance your investment strategy, consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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