Tan KW
Publish date: Wed, 19 Jun 2024, 04:14 PM
The daily chart of Bumi Armada (ARMADA, 5210, Main Board Energy) closed at RM0.565 on June 18, up 1.0 sen or 1.80% on a daily basis, sideways between the support level and the rising trend line. Its daily relative strength index (RSI) indicator began to rise and is at 48.98. Its share price may break through and climb to the resistance level between RM0.615-0.63 in the short term. Its support level is at RM0.55-0.56.
Huat ah, everyone.

This stock, sure looks like a bargain right now. Too bad I see people that usually get it wrong here. Specially those with very high level, general comments. Not able to research a company in detail.

Yes, even small project in between. There is Turkmenistan, Russia and Azerbaijan by the Caspian Sea. They all could be in need of offshore pipeline work.

We just had earnings that were good.
Price is up, substantially over a week, too.
Regularisation plan delayed till October.

What other positive news you expect ?

You are welcome. Take it from a guy who spent 3 years in Kazakhstan, both offshore and onshore. All the projects I saw were failing as the locals were simply too corrupt even for Italians to handle them. And it takes a lot to outdo Italians in corruption.
They had good coffee though, I admit.

FPSO Cameia is done by the Saipem with Chinese. Write it off.
Kazakhstan is not a very good prospect. I suggest you check Roach Energy, now at all time low. They operate in Kazakhstan.

Shareholders in Armada are trapped. Kena trap. There is always bad surprise, like broken pump at Kraken, 500 mln impairment on future cash flow or no new project at all, despite being selected as preferred bid for Cameia. Or delays after delays to Armada Sterling V. I think people hope Armada runs out of things to go wrong, and wait for just NOTHING. Meaning no more bad news for a while. That would be our 'break.'

I like the use of word SOON in this official release of the ministry. I also prepared 3 similar phrases for use. They all mean nothing. Good to use when being pressed by a fiancee to get married. They are:

BEFORE YOU KNOW IT
FASTER THAN YOU THINK
IN NO TIME AT ALL
😅

The company must prepare a plan and the plan has to be executed, then 2 periods of positive earnings achieved AFTER the implementation of the plan. That takes time.
Earnings have not much to do with the MUGG - Material Uncertanity as Going Concern expressed by the auditors.
Plan has to address the MUGG's. It is MUGGs, not the earnings that trigger PN17.

I remember Mike Lim (Kim). He really tried his best to put a positive spin on things, but eventually he could not do it any more. Neither could you. I also got some other shares on the side and there seem to be more upside elsewhere. The final nail in the coffin will be the leaving of Nick Cheong.
Not that the management types care. They seem to like it to take it easy.
The best solution for Armada would be to be absorbed by Yinson.
Good luck to you.

This counter will not be allowed to go completely under. And miss lee is the new wizard that will perform magic on the assets to make them disappear from the books.

Cannot blame sellers for getting out of this counter. I blame management for NOT securing a single project in years.
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some clown has unloading BIG time since late April when it broke the 58 sen. only reprive was when the Q1 resukts was announced... even then selling was still heavy. are we missing out something

Wow, I put order at 0.555 expecting it to be filled in a month, but I got the shares within two hours. VERY, VERY heavy selling as of now. Price went below my bid and instead of waiting, there is now selling at this price.
This is more than just a market flactuation.

Hi Pandu. I calculated time when this company will leave PN17. If all goes well, in early 2027. Here is my reasoning.
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Long Way to Financial Recovery (PN17 Process)

Bursa Malaysia has a special process for companies in distress called PN17 status. It stands for Practice Note 17/2005. Any PN17 company that triggered PN17 criteria must:

1. Regularize its condition within 12 months.
2. Submit a regularization plan.
3. Implement the plan.

The contents of the regularisation plan need to address the triggering conditions. Typical exercises performed to regularize the conditions are:

• Settlement of debts with creditors
• Reduction of capital to cancel accumulated losses
• Onboarding of new investors (white knights) via issuance of new shares
• Sale of assets
• Issuance of free warrants and right shares to retain old investors
• Establishment of an Employees Share Scheme (ESS)

The time required to achieve uplift from PN17 status is difficult to estimate as any part of the process may take longer than planned. The minimum length to complete the key steps on the road to normality is shown below:

• Approval of the Regularisation Plan by Bursa 3 months
• EGM Approval of the Plan by shareholders 3 months
• Implementation of the Plan 12 months
• 2 positive quarters AFTER the Plan implementation 6 months
• Application and uplift of the PN17 status 3 months

GRAND TOTAL …………… 27 MONTHS

So, if everything plays out right, investors will be reaping handsome profits in 27 months, or about 2 years from the time that the Plan is submitted. Not exactly very soon. And that is, if everything goes well.

I noticed too. Put a small order at 0.555 for 30 days. This price seems to be the rock bottom support. To be sold after the news. Unfortunately, will prevent price to go up if many think similar.

Not me. In fact I bought some more of it for a (hopefully) fast trade.

So they expect full start up next reporting period, full oil production by the end of the year.
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Gas production from the KG-98/2 asset, which will begin in 3QFY25, is expected to ramp up to 10mmscmd by FY25 end, while oil production could ramp up to 45,000bopd by 4QFY25.

That means that price will not go up substantially for 5 months. Alam management will take 5 months to prepare a plan. Submission to the Security Commission or Bursa will be the first good news of the regularisation process for us to experience and get some buying from the public.
Need patience and holding power till the end of October.

That is it for the year ?
Downside from here.

Thank you, very much.

Looks like buying has finished for now. And that is surely strange, following a recommendation.
It would indicate that people at tradeview, or someone with knowledge of BUY-guidance before publication front-run the stock to sell it to public at handsome profit.

Anybody could please share CGS ratings in pdf ?
Raymond Yap is the best analyst.
It was known as CIMB before.

We may both get lucky. I paid 3.0 a year ago (in September, after earnings) and averaged down at 2.5.
May start selling at 3...
Why not ?

This ship will not fly. It is too heavy. Burdened with debts. Any damage and will take in water.

Yes to being stuck. I am stuck with this stock since a year agoo too. Bought at 0.03. I posted my opinion here that is neutral to negative. In my opinion, management is NOT doing enough to get out of the distress scenario. I do not buy into the games they play, like they were not served properly at registered address (see earnings report with legal updates).
Maybe they should get off their butts and call, or go to the creditors - instead of claiming and fighting on technical irregularities. It is time to solve the debt issue. Meet, talk, propose, negotiate, pay a bit. But not send lawyers on the runaround. Take RESPONSIBILITY. Forward the message, apologize to creditor for a delay if he served wrong and work it out. Alam gets money for solving problem, not for playing games.

Yes Sslee. Agree. As I work in O&G I have several counters that do not well. Some on the verge of delisting.
I can assure everyone that the switch to green energy is nothing new. 40 years ago similar stories were told. I expect us to be rewarded for taking the risk.

Boy, this counter sucks. Did they appoint another perfume girl to the board ? Like the last one, with absolutely no experience of any kind. Had no time to check her out.

Good wrap up. Any new contracts worth mentioning for our favorite counter in sight ?
PS
I am an Yinson switcher. Boy it must be even more frustrating for longs there. All going well, yet the price down over a few years. Now, that is a real downer.
My guess is that reality trumps expectations.

Thank you. I missed the AGM, unfortunately. If you know of any carbon capture contracts or net zero projects that they signed later on, please post. This would be a game changer.
It is good that they focus on future, but what is the result of this focus in terms of bidding awards, please add here. In the past 8 years they had no contracts whatsover. Future related, or past, or present. Exception is ASV which is a JV only. But I like it that the 'focus' on new venture. I also like that they 'look' for opportunities. Probably means that the google things on the computer occasionally.

This is a very good point about contract discussion. Come to think about it net zero and carbon capture is the future.
Would you tell me of few new contracts that Bumi Armada secured in these growth areas ? I will do more research. Even a couple of examples would help a lot. Do they have any projects approved for bluestreak you mentioned ? I know that UK power providers were involved. What is their order value ?

I read a few analyst reports from IB's. Both Kenanga and UOB downgraded Armada and reduced targets.
I agree with this ratings.
As they pointed out, armada is unable to secure new projects. It has been 8 years since last big contract win.

The problem is not that the are unable to secure contracts for future.
The problem is that they have not been able to get contracts in the past.
So the damage is already baked in the cake.

As a result the company is dying a slow death.
Even with a new contract win there will be disruption to the earnings... for about 8 years.

Alam has reported that revenue DECREASED from 136 to 63 million in last period. There is no free cash flow to pay off debt. So I believe that they can only secure funds by selling ships at fireside prices. Still hope that they have a plan, but unfortunately they do not share is with stakeholders, as there is no regularisation plan as yet.

If creditors support debtors then no enforcement action can be taken. Obviously, this is NOT the case. RHB filed petition now restrained. So I doubt they supported any proposed SoA (Scheme of Arrangement). I believe they were restrained to make such agreement possible rather than selling off the company assets.

Also, profits in the earnings must be made AFTER debts were paid in accordance with the regularisation plan and the scheme for company to be consider for uplift. Profits now do not help. On the contrary, why company making profit is NOT paying debts ? Looks like evasion. Regularisation Plan has not even been presented as you point. So we are years away from this event.

I advise you to look at Scomi Energies. The company was making a profit, paid creditors per agreement but it got delisted and shares are worth nothing. Equity ratio critera need to be satisfied too. Alam too, may pay all debts and still be delisted if equity is not high enough. Alam Maritim Resources Berhad has a total shareholder equity of MYR-53.9M - NEGATIVE.

Let us hope that delisting will not be the outcome for Alam.

I am sure that to get company out of distress there are 3 approved ways:
1. Sell part of business. Pay off debt.
2. Get capital from white knights. Pay off debt.
3. Negotiate debt reduction with creditors. Pay off reduced debt per agreed schedule in Court Conducted Meeting.

Court action and restraining order is NOT a way to deal with the problem that bursa will approve. And of course, we see action on Tuesday.
Thank you for the input. There was very little meaningful discussion here. I appreciate your points.

Hi Liyam. So the company has a few more months to submit regularization plan. They have been unable to do so for 3+ years. And even if they submit one, they may be winded up by the courts. Obviously, creditors do not see much potential, or they would negotiate rather that petition to close it off. Substantial support to delay the liqudation from whom ? It is only delay of inevitable. I do not see any funds to pay off these debts that RHB and others claim.

This stock price depends on the distress situation (PN17). RHB Bank applied to the court to wind up the company. Assets would be divided among creditors, shareholders left with nothing. In addition to the court liqudation, delisting from bursa (unrelated) would make shares worthless. Earnings have little impact on valuation in the two scenarios.

All those transactions are suspicious. They should transact oil as their business.

I bought some more in the panic before the anouncement. It seems that we have a lot of investors NOT reading the forum here. Good earnings were expected.
Who were the selling people ... maybe some big funds avoiding any risk and willing to take small loss. I do not think that we have enough small investors to move price down.
Now they are repurchasing.
I expect another increase in price tomorrow, once the upgrades come in.

So there is still chance to load up, if you want fast profit.

I tried to register for this meeting but I was a few minutes late. They still had meetings for other companies for tomorrow, but not bumi armada. Perhaps it is for the better. All they can do is to repeat what is already contained in the AR anyway.

I glanced at resolutions, Greedy Gary was this time acting less greedy. No special resolutio for himself. Last year, more than 32% voted against shares for him. That was unusual. All other resolutions passed by a wide margin of 90% or so.

I worked for 10 years in Operations as a Supervisor and I still remember that we NEVER accepted contractors coming to LOOK. They would not get paid. They can carry out inspections, submit proposal, test the equipment per checklist but not just ACTIVELY LOOKING.
I have an impression that they just look at screen for a few minutes, then take it easy the rest of the day. Looking fo 8 years now. No wonder that price performance is mediocre.

Thank you for above video. It clearly shows that Armada achieved NOTHING from 2017.
ASV still in the works, scheduled for 2024.

In corporate lingo ACTIVELY LOOKING means doing nothing, just pretending.

I believe this is an option that is free money for the guy if the stock is valued above MYR 0.6.
After all, one does NOT need to pay until one collects the shares.

We will know the results before the AGM based on the price action. So far, looks neutral.

Greedy Gary got himself 5 million shares. It is outrageous, as the management got 60k. Look at the official anouncement on this site.
Someone needs to ask him about it in the annual meeting. The guy simply cannot control his greed and lost all the shame. So no shame in asking.
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08-May-2024 Others 5,147,400
Registered Name
Gary Neal Christenson

Greedy Gary fails again. This guy has no business sense. He chases latest fads. He disposed of OSV part of the business, which is blooming now. For example, Icon offshore went up 150% in the past year. Yinson bought them out. See post below...
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Yinson boss {Lim} is a season businessmen with an excellent track record. Paying MYR 173 million to Ekuinas for the 50.2% stake in Icon {using Liannex as his investment arm} maybe just the beginning. Liannex, Yinson and Icon all have their niche in marine logistics and engineering. Certainly Yinson boss{Lim} have plans for Icon. You don't paid 174 million just for the sake to acquire a company. Something big must be brewing in his mind

So much excitement about annual meeting ? It is normal.
I was investing here in the past, but got a little put off by the boss that dresses like a lady. Or a frenchman ?
But it may be a minor thing. Just a new style. Straits Energy is doing OK business wise, and strong background in logistics of the boss is the main thing.

What is up here ?
I tried to find the company Richfield, could not get any related info.
Curious if anyone managed to get an official update.
This was a good company in oil and gas... could resurface.

I just returned from a regasification terminal where I spent 2 months this year. This terminal is now installing a liquefaction train. There are many such conversion projects in the USA. Bumi Armada seem to be out of sync with the times. There is much more profit to be made on the liquefaction side of things. Little point of expanding regasification which is very simple - just a tank and a vaporizer that can be done by air and sun (it is a big column with many fins that collect heat without any power needed).
LNG project would be viable on the client side of value chain as demand is high, not sure about upstream part as installation may be pricey.

If Greedy Gary is still buying, he tries to keep the price down. He could delay news, prolong negotiation, not sign the contract, etc. Only after his bonus is awarded by special resulution of AGM - he may no longer be interested to suppress the price.

I do not think that Greedy Gary would allow for any payments for shareholders. He already has 30 million of shares for free or half free, will likely ask to pass a special resolution to award more for himself. Maybe another 30 million over few years ? He gave 60 k for management. That is 0.2% or less. At premium. This guy is so greedy it is sick. There will be no money for shareholders left.