Still seducing shorties to keep shorting

This counter every single minute got selling 14 or 15, or 148

KUALA LUMPUR: The latest round of financing announced by floating production storage and offloading (FPSO) operator Bumi Armada Bhd is seen as giving it more time to resolve its tight cash flow position.

But having recategorised the bulk of its short-term debt to long-term, analysts are mixed on the progress of the company’s road to turn around.

On one hand, the view is that Bumi Armada needs to lay out its restructuring plan more clearly to address its high debt level, while another pointed to the improving operating cash flow as a positive sign.

Bumi Armada said on Monday it had secured a loan facility of US$64.3 million (RM270.7 million) due Dec 31, 2021. The loan was obtained from Singapore’s ING Bank NV by Bumi Armada’s wholly-owned unit Armada TGT Ltd.

The new loan comes as good news for the company, which is working hard to reduce its short-term liabilities and pare down its overall debt to clean up its balance sheet.

In its latest quarterly results’ note, Bumi Armada said its lender for Armada Kraken Pte Ltd (AKPL) has agreed to remove the risk of having to prepay its long-term loan of RM1.33 billion, previously classified as short-term liability due to non-compliances related to the FPSO Kraken vessel project.

With the AKPL loan set to be recategorised, Bumi Armada’s short-term debts now amount to RM1.145 billion, comprising RM813.24 million term loans and another facility of RM301.55 million.

In November last year, Bumi Armada’s major shareholder Usaha Tegas Sdn Bhd provided commitment to financing US$75 million to refinance an existing facility and to fund Bumi Armada’s 30% equity interest in a joint-venture project in India.

Coupled with this latest loan of RM271 million, that leaves another RM874 million short-term debt which the company has to pay off or refinance in the near term.

Between October and December 2019, Bumi Armada paid off RM389.13 million worth of borrowings.

Amid the slew of good news, one analyst with a local investment bank maintained that the crux of the problem is the group’s high gearing. Long-term borrowing still stands at RM8.345 billion after including the recategorised AKPL loans.

Finance costs for the year stood at RM555.5 million from RM522.15 million the year before — more than its gross profit of RM553.44 million for the same period.

“The financing is a good short-term relief to support its cash flow. But considering its predicament, it might find it difficult to negotiate the terms of financing,” an analyst with a regional bank told The Edge Financial Daily.

“Considering its high debt level, refinancing is not a long-term solution. It still has to figure out how to turn things around.

“It helps if Bumi Armada can secure redeployment for FPSO Claire, or if it manages to monetise its FPSO assets while still retaining control, such as its prized asset FPSO Olombendo,” the analyst added.

Another analyst with a local investment bank, meanwhile, highlighted the company’s improving operating cash flow of over RM700 million last year — adding that it could improve further from better contribution from FPSO Kraken on improved uptime performance.

“It (Bumi Armada’s financial position) does not seem as alarming as it once was,” said the analyst. “It depends on the discount warranted on this company … considering the negative surprises previously.”

The counter, which is linked to tycoon Ananda Krishnan, has a wide range of target price (TP) from a low of 20 sen to a high of 75 sen per share, with an average TP of 48 sen per share.

It closed unchanged at 31 sen yesterday, with a market capitalisation of RM1.82 billion. Bumi Armada was among the top active counters on Bursa Malaysia, with some 72.97 million shares traded.

The counter retreated from its high of 54 sen in January, following weaker oil prices amid concerns about global demand due to the Covid-19 outbreak, and further dragged down by weaker results for the fourth quarter ended Dec 31, 2019 (4QFY19).

For the quarter, the group booked an impairment amounting to RM233.6 million on accrued lease rental in relation to the unsuccessful legal claim against Woodside Energy pertaining to the wrongful termination on FPSO Claire. It is currently filing an appeal against the decision.

Meanwhile, there is also the possibility of partial write-back on impairment worth RM479 million made in 4QFY18 arising on FPSO Kraken, which saw improved uptime performance last year.

https://oilprice.com/

Now oil price continue up and djia future continue up seems like no effect to Armada already, but when oil price down and djia down, Armada sure follow down

Actually Monday Armada positive announcement not yet reflect to the share price yet

Unlike Armada, dropped since last Monday till now, never even have a sign of rebound

When djia up almost 1300 points on Monday, Armada not even up, but pressed down by EPF, yesterday djia dropped 700+++ points, means djia still got up 500 points, got rebound big

Anyway, from my analysis, this week unlikely go up to 0.35 or above, because of EPF and Armada operator controlling the price together and collect those sohai stupid shorties shares

That means Armada operator they have not yet to collect enough cheap shares yet, that's why need more cheap shares from sohai shorties again

I believe today early morning EPF got dispose alot of shares at 0.325, that's attracting shorties to short

And yesterday positive announcement seems like not reflecting to Armada shares price yet, that's showing Armada operator in collection mode now

Armadatuah, as usual, Armada might take weeks to collect cheap cheap now, that's why no rebound at all

Yes true itch, they are really too kind hearted, but why they so kind hearted when the price was 0.50+, then not advised us to sell that time?? Anyway god is watching

Never ending selling pressures

Everyone know you are shorties here, asking all of us to sell

Now Armada totally no people buying

Already know, Armada operator Wong leg the price go up or rebound big today

But I don't think today will up so much, based on the trading pattern now

Bullrun, if today really can up to 0.36 or 0.37, then I cut lost lp, what to do

4, then 13 or 14, then 34 or 35, it's quite consistent selling

Anyway, despite all these every single minute selling, the selling has been subdued

Every single minute got some signal selling, means EPF and Armada operator are waiting for shorties to keep shorting, then they can collect cheap? If not the price already up

Seems.like every single minutes also got sellers

This counter only benefiting shorties

35, 73, 84, etc are signals given by EPF to attract sohai shorties to short

EPF and his machai shorties ,keep controlling the price by shorting

Because with a healthy counter, with good news and good sentiment, price dropped from 0.47 to 0.31, but no sign of big rebounds means that's actually they are collectiing cheap shares

Personally think that Armada operator is still midst of collecting cheap shares

Today Armada no big rebound, so that means god ask me to hold, not going to sell for next few weeks

Today should be no show

I believe EPF stopping the price at 0.325

Even though oil price continue go up another 3% now, seems like no rebound of oil counters

https://oilprice.com/

Obviously, Armada operator don't want to push up the price, still collection of cheap shares now??

Wow, oil price up almost 5%, djia big rebounded 5%, today oil and gas counters or even klci big up, alot or speculations on oil and gas counters already, if up to 0.36 today then I will sell

Take my words, tomorrow djia will strongly rebound

If tomorrow really rebounds to 0.36-0.37, I will sell partially or all, waiting for it to drop back again to 0.29-0.31 to collect back cheap cheap, if not then sell next week when back from outstation Friday

Wow, tomorrow Armada will rebound big

Bumi Armada Berhad ("Bumi Armada" or the "Company") wishes to announce that its wholly-owned subsidiary, Armada TGT Ltd ("Armada TGT") has secured a loan facility of USD64.3 million (approximately RM270.86 million) with a final maturity date on 31 December 2021 from ING Bank N.V., Singapore pursuant to the terms of a Facility Agreement dated 29 February 2020 (“Facility”).



2. INFORMATION ON ARMADA TGT



Armada TGT is a company incorporated in the Republic of the Marshall Islands and is a wholly owned subsidiary of Bumi Armada.



The principal activities of Armada TGT are ship owners, charterers, managers of ships and vessels, and provision of marine support and other services to offshore oil and gas companies.



Armada TGT owns the FPSO Armada TGT 1 which is currently servicing a charter contract with Hoang Long Joint Operating Company in the Te Giac Triang field for a firm charter period from 27 August 2018 until 14 November 2024 (“Bareboat Charter”).



3. INFORMATION ON THE FACILITY



The Facility is intended for Armada TGT to fund, amongst others, the repayment of its existing loan from the Company, transaction expenses and financing costs.



The repayment of the Facility will be via charter proceeds from the Bareboat Charter and the security for the Facility is the standard security package for this type of loan facility.



4. EFFECTS OF THE FACILITY



Issued and Paid-up Share Capital and Substantial Shareholding



The Facility will not have any effect on the issued and paid-up share capital of Bumi Armada or the substantial shareholders’ shareholdings in Bumi Armada.



Earnings



The Facility is not expected to have any material effect on the earnings of Bumi Armada for the financial year ending 31 December 2020.



Net Assets and Gearing



The Facility is not expected to have any material effect on the net assets and gearing of the Bumi Armada Group based on its latest audited consolidated balance sheet as at 31 December 2018.



5. DIRECTORS AND MAJOR SHAREHOLDER’S INTERESTS



None of the Directors and/or Major Shareholders of the Company or persons connected with them have any interest, direct or indirect in the Facility.



6. DIRECTORS’ RECOMMENDATION



The Board of Directors of Bumi Armada is of the opinion that the Facility is in the best interests of the Company.



This announcement is dated 2 March 2020.



*Based on the exchange rate of USD1 : RM4.2125 on 2 March 2020 as set out in Bank Negara Malaysia’s website

https://oilprice.com/

Oil price up 5%

Perdana rebounded already

https://dowfutures.org/

Djia future up 3%

Mikekim, still got bullets to average down??

Price wont break 0.315 for sure

Now Armada collecting those force selling shares, if not already move up

What's the intention of all these people keep asking us to sell, at this super cheap price? If rebound big then we will sell la

Actually for every counter, there will be down then rebound, but not even see Armada got rebound since last week whole week dropping

I think Armada today unlikely will close green or break 0.315, because it's fully controlled by Armada operator behind, unless shorties buy back their shares

Yesterday I said today worldwide index will turn green and rebound, and it's proven, n I did mention oil Price will rebound, it's proven, and oil price after deep production cut,will even more gap up, will be back to 60usd range again after OPEC meeting