Continuing the rationale from the discussion above, during covid lockdown times toll revenue would have been lower (indeed reflected in the reported revenues). But now toll revenues are back to normal. So shouldn't dividends be higher too?
A question. Will there be any charges by way of brokerage, stamp duty etc. on the final offer payment to shareholders as this is not an open market transaction. I don't want to ask this question to my remissor.
@Pinky. Thanks for clarifying. I would still like to understand the accounting side of it. Does this mean that once you finish building the toll road or water treatment plant Taliworks immediately recognize the operating cashflows for XX years as profit ( a big lumped number in a year) followed by no income recognitions from the operating cashflows in the subsequent years?
Ref: Mabel's observations on US elections and Trump's chances. Very good analysis and insight. I believe the key here is the voter turn out. Even in 2016, Trump managed to win based on the voter turn out, which is the main reason why opinion polls and results are quite different, not because people say something but behave differently to their expressed opinion. That is why democratic campaign this time around has been focused on getting people to vote. And also possibly the reason for Biden's candidature. If this strategy pays of Biden and Democrats can pull off a win. What is certain though is even if there is a Biden win, there will be legal challenges from the Trump camp, most likely around the postal votes. And postal votes will be critical this time around given upto 20% of total votes cast could be mail in.
Armada has around 25 Offshore vessels and a couple of pipe lay / construction vessel. The brand new cost of each OSV is around USD 15 mil. Take 100 mil for 2 construction vsls. That will make around USD 700mil of MYR 2.8 Bn as new. Armad has in the last last couple of years declared impairment in excess on MYR 2 Bn. So these assets should be sitting in their books at close to scrap or zero value. I can't see how they can have any further impairments unless some kind of accounting gimmick / fraud is at play here
I agree with most of the writer's observations except for the compensation. Usually in a contract like this the termination fees are so high such that the project IRR is usually improved if the contract is terminated early rather than serving out the full term of the contract. I other words it is higher than even the figure given by Daily charter rate x number of remaining days in firm contract. Now Armada will not get paid this amount if the client has reasonable grounds for termination. From what I hear there were definitely issues on the asset but nothing that will warrant a termination. So Armada's position is quite good on this. But do expect a long drawn out court battle on this before it is finally settled.
Just a simple thought exercise. Icon has got 38 vsls (incl. 4 on order). At an average value of USD 8 mil/vsl this translates to roughly MYR 1.2 Bn. The Company has aprox. RM 700 mil debt. (from last yr financials). So net value attrib. to shareholders is approx. 500 mil. At RM 0.4/share the market value is roughly RM 470 mil. So is it currently undervalued?