Round 2 - Analyst Flashcards

1
Q

Tell me about yourself

A

I grew up out east and completed my Bachelor of Commerce at Queen’s University. I signed on with Cenovus full time after a summer term here. While at Cenovus I was in the rotation program with roles in internal audit, corporate taxation, and FP&A. During this time, I also completed my CPA designation and quickly realized I was more interested in finance and signed up for the CFA program.

I’m super excited to be applying for your team because
I’ve always enjoyed working with spreadsheets and analyzing investment opportunities so I know this role would be a great fit. I also heard great things about the role, the team and how I would be exposed to all the exciting initiatives happening at the company.

I’m passionate about technology and equities investing. I also do a bit of real estate investing on the side.

Outside of work, I love travelling but haven’t been able to do much of that since the pandemic started. Instead, I picked up golf like a million other people. I’m still absolutely awful but I played quite a few rounds in the summer and had lots of fun. I enjoy skiing as well so I’m pumped to start going soon now that some of the hills are open. I also joined a 100K challenge for November so I’ve been running a lot this month.

That’s a bit about me, I would love to get to know everyone on this call as well.

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2
Q
  1. What interests you about Investment Appraisal and Portfolio Management?
A
  • I understand the accounting side well but I’m looking for a more challenging role where I can make more of an impact and see tangible results from the work I do. Frustrated because accounting is more regulatory and compliance in nature.
  • I’ve always enjoyed working with spreadsheets and analyzing investment opportunities so this role would be a great fit
  • I heard great things from Josh about the role and how you get to be a part of all the exciting initiatives happening at the company about the group. He also mentioned that you are focused on development in your team, ensuring that we have meaningful work which are all extremely important to me.
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3
Q
  1. What do you know about the role? Investment Appraisal & Portfolio Management?
A

a. From what I heard from Josh, I would be part of a pool and allocated work based on what is happening and capacity.
b. The IA&PT team is responsible for the capital allocation process
c. Sets minimum investment criteria, economic evaluation standards and guidance to asset teams on common methodology.
d. Owns IC meeting process and signing off on opportunity memos (sign off on memo over $10MM – validate economics methodology, alignment with strategy, formatting consistent with IC)

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4
Q
  1. What is biggest risk in oil and gas market?
A

a. Short term: Biggest risk in the market I believe is on the demand side with regards to COVID-19. If case counts worldwide increases significantly forcing government to shut down cities, oil demand may drop significantly. On the flip side, this is where the biggest opportunity is as well. If vaccination rates keep increasing and cases are kept under control, we’ll see robust demand from air travel, vehicle use and just general economic activity. Another thing I am keeping an eye on is the winter and whether demand will increase based on temperatures. I don’t see too many risks on the supply side. Despite pressures from Biden and other world leaders, I don’t think OPEC will be forced into increasing production in a meaningful way. The industry also has been underinvesting in long term growth projects so there isn’t too big of a risk for oversupply.
b. Long term: Biggest risk at least in Alberta is ESG and egress constraints.

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5
Q
  1. What career accomplishment are you most proud of?
A

i. I’m most proud of when I was able to decrease the time it took to perform a monthly process by 87% through automation. This was back in 2017 before we sold a lot of our Conventional properties. The initial process required data to be extracted and manually manipulated to arrive at the right numbers. This included deleting certain lines, copy and pasting specific data, finding specific values and replacing it with something else. Every time I performed this process, I had to follow a long list of steps which were extremely time consuming and often resulted in rework if a step was missed.
ii. To improve the process, I started trying to find ways to automate the process in excel with advanced formulas but quickly realized that I would probably need to start coding macros to accomplish this. At the time, I had never built a macro before or even went into the Visual Basic application before. I searched around for courses on building macros and eventually found that Cenovus actually offered an in person course. I signed up right away and used what I learned to build a macro to automate the process. To make sure I still got the desired results, I tested the macro alongside the original process for three periods and everything worked perfectly.
iii. Now instead of all the manual data manipulation required, all I had to do now was import the data and run the macro by pressing a button. So it was extremely successful and

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6
Q
  1. Greatest weakness
A

a. Not as much modelling experience in my professional roles but I have been doing it outside of work. I’m also a quick learner so I’m sure I can pick it up quickly.
b. Type A personality so sometimes I get impatient and frustrated if things aren’t happening at the pace I want them to be. To help with this, I now meditate and exercise daily which has helped me be more at peace and even more focused and productive.
c. Net working follow up, get better at staying in touch with friends and peers

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7
Q
  1. Greatest strength/Why should we hire you?
A

a. Working with others and can get along with anyone
b. I love working with spreadsheets and analyzing investment opportunities
c. Quick learner and willing to work hard every single day to make sure I end the day a better version of myself.

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8
Q
  1. Tell me about a difficult work situation and how you overcame it?
A

a. AG Sale. We were asked to do a intercompany disposition and acquisition of the Athabasca Gas property from Cenovus Energy Inc (211) to FCCL Partnership (273). There were no clear instructions on what had to be done and I had never done a transaction like this before.
b. To start I reached out to my network to see if there were any recent intercompany transactions that were done so I can model the process on that. No point recreating new processes if it was already done.
c. I found one that was slightly similar project but it was related to an NRP property so it wasn’t as complicated. Nevertheless it was a good starting point to determine which teams will be impacted.
d. Built a checklist of all the steps required and teams that will be impacted. This included operations teams and JDE to determine a new cost hierarchy, royalties teams, treasury to transfer the purchase price. At one point I remember we reached out to you to determine a valuation for the assets.
e. This project was a success and we were able to close the sale in Q3 2020. Although it was really tiring as I was working on this project while completing my normal accountabilities, what I learned throughout this process made it worthwhile.

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9
Q
  1. Tell me about a time you had to manage a particularly heavy workload. How did you handle it? How teamwork helped.
A

a. Earlier this year, one of my coworkers was let go unfortunately. For some background, I’m responsible for the Foster Creek asset while she was responsible for the Christina Lake asset.
b. Following her departure, I agreed to cover both assets for April and May so we did not have to hire anyone to cover while we were waiting for another team member to return from family leave. This effectively doubled my workload for the two months.
c. First, I created checklists for both properties organized by due date to ensure I didn’t miss any deliverables. Next, I prioritized these tasks by due date. I also enlisted the help of another team member and delegated tasks to him based on what he was able to handle and performed the more complicated ones myself. I was able to successfully complete all deliverables by the required dates while providing insightful analysis for management and external reporting.

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10
Q
  1. Describe a time when you made a mistake
A

a. Part of my current accountabilities include preparing quarterly income analysis. This report analyzes quarter and ytd variances. When I first moved into this role, we had just acquired the Conoco Phillips assets so our reporting was affected by changing working interest during this time. Since it was my first time preparing this report, I did not consider this change. Luckily my supervisor caught the mistake and questioned me on it. Reflecting on this, I realized that the reason I had made the mistake was because I did not have a full understanding of the report and was just following a list of steps provided by my predecessor. From then onward, I always try to understand why and how we are performing a process instead of just following a list of steps.

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11
Q
  1. Describe a time when you knew the outcome that you needed to achieve but had no clear way of getting there. PROBLEM SOLVING
A

a. AG Sale. We were asked to do a intercompany disposition and acquisition of the Athabasca Gas property from Cenovus Energy Inc (211) to FCCL Partnership (273). There were no clear instructions on what had to be done and I had never done a transaction like this before.
b. To start I reached out to my network to see if there were any recent intercompany transactions that were done so I can model the process on that. No point recreating new processes if it was already done.
c. I found one that was slightly similar project but it was related to an NRP property so it wasn’t as complicated. Nevertheless it was a good starting point to determine which teams will be impacted.
d. Built a checklist of all the steps required and teams that will be impacted. This included operations teams and JDE to determine a new cost hierarchy, royalties teams, treasury to transfer the purchase price. At one point I remember we reached out to you to determine a valuation for the assets.
e. This project was a success and we were able to close the sale in Q3 2020. Although it was really tiring as I was working on this project while completing my normal accountabilities, what I learned throughout this process made it worthwhile.

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12
Q
  1. A time when I demonstrated strong verbal and written communication skills, tailored to specific audience.
A

a. Quarterly, I prepare the income analysis and performance management reports for Foster Creek. These reports are used for both management reporting and external reporting. I also attended monthly property meetings where I discuss Foster Creek performance compared to budget and prior periods.
b. While preparing the reports and attending meetings, I always catered my communication based on the audience I was presenting to. Certain reports would go to senior management while others to the operations teams so the level of detail I presented varied widely.
c. I ensured my communication was clear and succinct while emphasizing the key drivers impacting performance for the period. This was extremely important as the information is used for decision making and feeds into external reports such as the MD&A.

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13
Q
  1. Tell me about cenovus’s portfolio, the oil and gas industry, and capital markets
A

a. 4 main segments: oil sands, conventional, offshore and downstream.
b. Oil sands properties which make up the bulk of our upstream production: Foster Creek, Christina Lake Surise, Tucker
c. Conventional assets (deep basin and rainbow lake, marten hills)
d. Offshore: Atlantic and Asia Pacific where we get really good pricing
e. Downstream: Lloyd upgrader and several refineries with total capacity of 660K bbls/d

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14
Q
  1. Describe when you were able to analyze data and provide insightful analysis that illustrates critical business drivers and develop appropriate solutions.
A

a. Electricity driver (COS, fuel price, coincident peak penalties).
b. One of the cost drivers we must analyze is electricity. This is a particularly challenging driver to understand because our electricity is generated at our cogeneration plants and purchased from the grid. Any costs to generate electricity at the cogen plants are charged back to Foster Creek as cost of service. This means that Foster Creek electricity costs fluctuate based on natural gas prices and consumption, cogen maintenance costs and grid pricing.
c. Monthly I was able to articulate the main drivers behind changes in electricity costs by drilling down into the data and communicate these for reporting purposes.

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15
Q
  1. How do you identify opportunities and make decisions?
A
  • First step before trying to identify any opportunities for me is to develop a good understanding of the market. This would include researching and learning all I can about a certain topic, what the best practices are and what our peers are doing.
  • Next I would spend some time to get organized and quiet my mind to think of any opportunities using all of the knowledge I developed in the research phase.
  • Once I have a few ideas, I would bounce these ideas off my peers and get their thoguths and insights. These discussions will allow me to quickly identify any flaws or new ideas.
  • Decision making: Identify the problem that we are trying to solve and all of the alternatives. Identify if there are any specific make or break criteria that would disqualify any specific alternatives and remove these. From remaining alternatives perform quantitative and qualitative analysis and rank them from best to worst.
  • Qualitative would be things like whether it matches our values and other things like ESG targets.
  • Quantitative: determine if the project adds economic value. This would mean looking at returns (IRR, NPV9, PIR9 – profitability index ratio) and growth (FFF)
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16
Q
  1. Favorite book right now:
A

a. The book about Elon Musk by Ashlee Vance. I’m a big fan of Elon and his story is extremely inspiring. Especially when it comes to SpaceX and Tesla and how close they both were to failing. The incredible courage it took to place all
b. Ride of a lifetime by former Disney CEO Bob Iger. He was an incredible CEO who led the Disney’s acquisition for Pixar, Marvel and Lucasfilm. The book is filled with nuggets of wisdom such as being honest, humble, optimistic and courageous.
i. True authority and true leadership come form knowing who you are and not pretending to be anything else.
ii. Optimism. One of the most important qualities of a good leader is optimism, a pragmatic enthusiasm for what can be achieved. Even in the face of difficult choices and less than idea outcomes, an optimistic leader does not yield to pessimism. Simply put, people are not motivated or energized by pessimists.
iii. Don’t be in the business of playing it safe. Be in the business of creating possibilities for greatness.
iv. Ask the questions you need to ask, admit without apology what you don’t understand, and do the work to learn what you need to learn as quickly as you can.

17
Q
  1. Describe a time when you had to work with someone whose personality or work style was very different from yours.
A

a. In my current role, I am constantly working with teams in the field and engineers who often have very different personalities and work styles.
b. One specific example was two years back when I was still supporting Christina Lake. There was a turnaround scheduled and I was working with the Operations teams to come up with cost estimates for the work that was scheduled. As we were going through the process, I realized that the estimates used for our accruals were significantly higher than what was being used for forecasting purposes.
c. Upon further discussion, I discovered that the Operations team was including a buffer in the estimate numbers in case costs came in higher than they expected. I immediately set up a meeting with the Operations team and presented on what the accrual process should be and why estimates should not include buffers.
d. I find the best way to communicate with others is to be patient, honest and non-confrontational. By communicating this way, the teams were a lot more receptive to my message.

18
Q
  1. Go to songs
A

a. Faceoff – pump up
i. It’s about drive, it’s about power
We stay hungry, we devour
Put in the work, put in the hours and take what’s ours (ahoo)
b. Weeknd
c. Edm (zed, kygo)

19
Q
  1. Group is very much work hard play hard mentality, how would you fit into that?
A

a. I went to Queen’s commerce where every single person lived and breathed by the work hard play hard mantra. Well, first year was definitely heavier on the play side. I’m no stranger to hard work and late nights but at the same time partying several times a week was almost expected in the program.
b. Being in accounting, I’m used to having to work outside of normal hours. In my current role, we are always much busier during month end and quarter end. Like this weekend I had to work on Sunday in order to build a new slides to present to the Oil Sands VP. In my previous roles in internal audit and corporate taxation, we were always busy during certain times in the year when we would be expected to do whatever it took to get the job done.

20
Q
  1. Tell me about your investing
A

a. I started investing in 2013 which I was a summer student at Cenovus. I was earning good money at the time and just received a windfall from scholarships. At the beginning, I mostly invested in large cap blue chip companies. As I kept learning, I began to gravitate towards riskier growth-oriented companies.
b. Today, most of my contributions go to index ETFs but part of me thinks that passive investing is extremely overvalued right now. That’s why I devote at least 25% of my contributions to find small cap and startup companies with high growth potential and only invest if I have strong conviction in the team, the technology, and the business.

21
Q
  1. Teamwork
A

a. I strongly believe interdependence is required to achieve the greatest success.
b. By helping others and working as a team, we are able to achieve a lot more than if we didn’t. where 1+1 does not equal 2, it could be 5 or 10.
c. Strive for Win win
d. Example: Lay off

22
Q
  1. Biggest Mistake outside of work.
A

a. Earlier this year, I had the opportunity to invest in the pre-seed round of a fintech startup called flahmingo. The company was building a direct competitor to Wealth Simple by offering commission-free fractional investing. The app also allowed for recurring deposits to automatically be invested based on your portfolio allocation.
b. I passed on the opportunity because I was not convinced that the company deserved a $9MM valuation when the app wasn’t fully developed yet. A few weeks later, flahmingo announced that the pre-seed round was 90% oversubscribed. I’m still wondering if there’s something I missed that the other investors picked up on.

23
Q

Questions?

A
  1. What does the team do to get to know each other better?
  2. What is one thing you love about your role or the team and one thing you dislike?
  3. Does the team have social events or team building events?
24
Q

Convinced someone of your way.

A

d. Example: In my current role, I build a lot of reports to present to management. At the beginning of the year, we had to establish a new performance management report to present Oil sands operating results. Since this was a new report and we had to integrate both legacy Cenovus and legacy Husky information, there were a lot of challenges. Throughout the process, I worked collaboratively with legacy husky teams to establish a process to prepare the report. While there were many disagreements over how the report should be prepared, we were able to agree in the end on the best way to present the information. Throughout the process, I communicated in a respectful, patient, and non-confrontational manner while focusing on the objective at hand. I was also receptive to ideas presented by the other teams and this led to the best outcome as we were taking learnings from both companies.