Insider Buys Shares in Cheniere Energy

President and CEO purchases 35,063 shares

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Sep 21, 2016
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Jack Fusco (Insider Trades), president and CEO of Cheniere Energy Inc. (LNG), acquired 35,063 shares in the company on Sept. 19. The price per share was $42.78 for a total transaction of $1,499,995.

Cheniere is a Houston-based energy company primarily engaged in liquefied natural gas (LNG, Financial) businesses. It owns and operates the Sabine Pass LNG terminal in Louisiana. The company has a market cap of $10.3 billion.

No insiders acquired shares in the company in 2013 and 2014; however there were 65 insider sells totaling 2,107,150 shares in 2013 and 52 insider sells totaling 1,542,750 shares in 2014. In 2015, there were nine insider buys totaling 7,692,990 shares and 43 insider sells totaling 2,041,666 shares. Carl Icahn (Insider Trades),10% owner, conducted eight of the nine LNG insider purchases in 2015, or 7,683,990 shares out of 7,692,990 shares purchased by LNG insiders in 2015.

Including the aforementioned transaction, Fusco purchased 139,597 shares in the company in four transactions since being appointed CEO of Cheniere Energy in May 2016. Senior Vice President and CFO Michael Wortley (Insider Trades) sold 1,500 shares in the company for an average per share price of $44.96 two days prior to Fusco’s most recent transaction to date. For more information about insider trades with LNG, click here.

LNG total revenues amounted to $176.827 million in the second quarter ended June 30. Total revenues increased in comparison to $68.025 million reported in the second quarter of 2015. Net loss more than doubled from $118.495 million, or 52 cents per share, to $298.418 million, or $1.31 per share, from the second quarter of 2015 to the second quarter of 2016. Total operating costs and expenses also increased from $163.899 million to $253.281 million when comparing the same periods of time. During the second quarter, Cheniere continued the transition from a development company into an operating company. Fusco commented that the company “continued to manage [its] debt maturity profile by successfully issuing bonds to prepay a portion of the outstanding borrowings under credit facilities for both the Sabine Pass Liquefaction Project and the CCL Project.”

The Sabine Pass Liquefaction Project is a development and construction project conducted by Cheniere Partners through its subsidiary, Sabine Pass Liquefaction LLC. The project includes the development and construction of natural gas liquefaction facilities at the Sabine Pass LNG terminal and the construction of up to six liquefaction trains. Train 1 was completed May 31, and Train 2 was completed Sept. 15.

The company also announced the upsizing and pricing of its previously announced offering of Senior Secured Notes due 2027 for Sabine Pass Liquefaction LLC. The notes have an interest rate of 5.00% per annum and will mature on March 15, 2027.

Sabine Pass intends to use net proceeds to prepay all principal amounts currently outstanding under its credit facilities and pay capital costs connected with the construction of the first five trains in the Sabine Pass Liquefaction Project.

According to GuruFocus.com information, Cheniere Energy Inc. has a business predictability rank of 1 out of 5 stars. For more information about business predictability rank, click here.

Jim Simons (Trades, Portfolio) and Murray Stahl (Trades, Portfolio) reduced their stakes in the company during the second quarter. Simons sold 109,700 shares in the company for an average per share price of $35.16 after acquiring a stake in the company during the previous quarter. Simons initially purchased 396,200 shares of LNG for an average per share price of $32.42. Stahl sold 1,407 shares of LNG, decreasing his stake in the company by 9.93%. The total estimated loss of the holding since the third quarter of 2015 is 30%. For more information about guru trades with LNG, click here.

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