10000 lots at 0.54 now.
Not selling anyone?

More than 8000 lot of buy queue at 0.54 now.
Those who want to sell, please vomit all the shares now and get it over and done with.

it won't stay long at this low price. price support is building up fast.
obvious market mispricing due to over pessimism and impatience of some investors.
those who want to sell, sell now please to the accumulators.

yeah probably someone trying to short the stock.
Time for a short squeeze.

All O&G stocks went up today except Armada.
Someone is trying to press the price down.
Oh well, in that case, I'll buy haha.

oil price more than US$80, all final acceptances achieved, share price all time low, don't buy now to average down then really don't know when to buy lol.

the turnaround point for the entire O&G industry is coming. the bankers are also not stupid - just restructure armada's debt to longer term, let armada's business and cashflow generation flourish, and they will get paid back their entire principal + interest safely. I would see the risk of banks calling on Armada's debt now as close to zero.

Bought another 2000 lot @ 0.54

EPF seems to have stopped buying the stock - been a bit quiet on the announcement.

Hold firm, queuing at 0.545 to accumulate.

now's the time to accumulate

Patience - wait till end Nov QR + 6 Dec 2018 OPEC Vienna meeting.
In the meantime, accumulate on dips.
$$$$$$

Also, what's the point of keeping Pierre as special adviser to CEO.

Just costing Armada a few million ringgit a year to keep a figurehead with not much function. Maybe this is because Pierre and Leon Harland were old friends at SBM offshore. Who knows.

Let Pierre transition his knowledge and task to the new CFO over 6 months then say goodbye to save cost!

Armada is obviously not very good in keeping costs down, paying this and that penalty, paying a burgeoning management team millions of ringgits while the share price performs like shit and shareholders suffer.

So it seems like Armada is hiring a CFO specialising in "insolvency, restructuring and non-performing loans".

Looks like a shit storm ahead. Makes sense some investors become jittery and start dumping Armada's shares.

Time to make a statement, Armada, on what's the plan!

Luke Targett - new CFO CV:

https://www.corcordis.com.au/people/luke-targett/

Luke has practised in insolvency and restructuring for more than 25 years. Luke also has significant financial advisory experience covering pre lending reviews, transaction advisory, due diligence, independent business reviews and non performing loan management in numerous jurisdictions including London, Singapore, Indonesia, Myanmar and Thailand. His assignments advising financial institutions, bond holders, steering committees, borrowers and creditors have included both formal and informal appointments covering modest exposures to those of more than US$1 billion.

It all depends on when Armada announces that its RM2bn kraken debt is successfully restructured to long term. Otherwise, the debt overhang is like to cap any share price advances. It's probably a stagnant dead stock for those who want short term speculative profits.

Ya, quite amazed how suddenly all the investors and analysts are so concerned about Armada's debt when they've always been there, when a few months ago everyone's calling a strong buy on Armada's turnaround in 2018 and reversion to being strongly profitable.

Purely a game of sentiment flip-flop I guess, but lesson learnt for me, haha.

To quell institutional investor's concerns, Armada should now make a statement on whether they plan to do rights issue or not to delever the company.

Just be absolutely clear and give guidance on what are the steps, like the first step is try to refinance with banks, failing which will draw on Euro MTN, failing which will divest assets to repay debt, failing which, as the last resort, may consider rights issue.

All they do now is give some wishy-washy vague comments, kinda tired of this shit.

Changes in shareholding for substantial shareholders (>5%) like EPF can be announced up to 7 days later according to bursa rules, so that's okay.

It's just that their investor relations department and communication with investors are so shitty and all they can think of is covering their own ass and refrain from saying anything wrong for fear of being called out.

For that, I think Sapura's management (although Shahril is grossly overpaid for a loss making company) has much better skills in communicating with investors, with regular updates on operations to help investors make more informed decision.

A few things that the new CFO needs to swiftly execute:

1) Restructure the RM2bn short term debt related to Kraken to long term to ease short term liquidity pressure.

2) Execute the US$1.5bn Euro medium term note to refinance other short term debt, and to provide sufficient working capital for any new projects.

3) Ramp up on receivables collection and stretch on payables for another 30 days or so.

4) Seek to divest a partial stake in certain productive FPSOs such as Olomebendo when the oil market is red hot now with better valuations to pare down debt.

5) Continue cashflow generation from existing FPSOs to build up cash buffer back up to RM2-3bn level.

And most importantly, goddamn announce these good news when the milestones are achieved to calm the nerves of investors. Communicate better with investors. Don't do it like Kraken final acceptance because Enquest announced it on their website, Armada was forced to issue a trading suspension request at like 3pm and resume trading at 4pm on a Friday afternoon preceding a long weekend holiday.

Well, someone has to be responsible for the fall in share price after announcing the impairment of Kraken prematurely. The signing happened on 27 Aug 2018 for Amended Agreement 2 for all the penalties that Armada has to pay to Kraken but they prematurely triggered a selldown by recognizing the impairment in Q2 2018. This is NOT in accordance with accounting conventions.

While they should've announced AA2 as they have done, they shouldn't have done the impairment first and let the market absorb the news. Furthermore, final acceptance was announced about one week later. Doing the impairment in Q3 2018, in line with the timeline when AA2 was signed, is the proper way, and there wouldn't have been a knee jerk reaction as we've seen.

So Pierre Philippe's head went on the chopping board and rightly so.

Who's next, Leon harland?

The buyers are so patient and skillful. Great execution.

Haha, the buyers like EPF are very cautious and defensive. Always buying without spiking the price, trying to accumulate as much as possible around 0.535-0.54, waiting for the impatient seller to spill it all out.

That's definitely going to be restructured to long term as Kraken has achieved final acceptance. It's quoted in almost every research report. Not too worried about that.

Oil price at US$81.4 now going red hot with Iran sanctions and OPEC decision not to increase output in their latest meeting with Russia.

Think the mistake most analyst made, and including myself, is that the turnaround year is not 2018, but 2019.

Mmm no idea, but generally someone is very keen to press the price down.

Perhaps got fed up with this stock, which I have been at times too.

Will take a step back and hold this through to 2019 at least. Will not monitor day to day from hereon, not a very good use of time.

Looking forward to the next QR. Till then.

Someone is very keen to cap the share price at 0.54 today haha

https://www.bbc.com/news/business-45629425

While oil price zooming past US$80 does not directly benefit Armada's fixed FPSO charter rate, it does somewhat alleviate counterparty credit risks (e.g. Eni, Enquests etc.) where their customers are able to sell the oil produced at higher price and generate higher cashflow, thus reducing the risk of not paying up.

A sustained oil price above US$80 will be key for E&P capex to come back, which will benefit the OSV segment of Armada strongly, but this will take 2-3 years.

Think the biggest issue with the stock is there's lack of a strong promoter in the market, and management successfully spooking the stock with Kraken's impairment which was highly unexpected. The Kraken final acceptance and impairment news was barely 1 week apart - i think the price wouldn't have tanked so much if management announced both concurrently.

Oh well, let's see what Leon Harland can do now. Sadly, I invested around the time when he first joined at RM0.75 and now it's in tatters at RM0.54.

Please join me to vote a big NO in the next AGM for any multi million ringgit management incentive plan. The money is better off being used to pay down debt.

The key thing is to announce the US$500m debt that will be due in the next 12 months, to be restructured to long term debt.

ok when i said sell it immediately rebounds hahaha from .535 to .545 lol.

sell sell sell!

Continue to press the price down to 50 cents please my funds are ready

Lol it's kinda funny, almost everytime I call a buy, someone immediately dumps the stock to spite me. Ok then please sell all you want, haha.

A lot more runway for it to go up.

Armada has no reason not to recover back to RM0.80 over time. I have no idea who is selling and shaking the price down over the last week, especially after Kraken final acceptance announcement. It's a huge positive for the company, but somehow some investors were putting downward pressure on the stock, confounding the market, but this won't last long.

Institutional investors are eventually going to see the compelling value in Armada on a risk-adjusted return basis, and they will come back strong once the uncertainty in the new malaysian government, trade war and Armada's debt concerns blow over and oil price zooms past US$80.

2016: Oil price US$30-40, Olombendo, Kraken, Malta not yet final acceptance, no TGT1 extension, same amount of debt, share price = RM0.75

2018: Oil price doubled at US$80, Olombendo, Kraken, Malta final acceptance, TGT1 extended, same amount of debt, share price = RM0.53

Well, unless the market significantly mispriced Armada in 2016 for a long long time, buying Armada now is of exceptional value given the significantly lower risk.

steel your guts, accumulate.
overly bearish sentiment, irrationality, short-term view, fear etc. presents the best opportunity to buy.

no risk no return.
or rather, my view for armada now is low risk high return.
hence i'll be holding my current shares and borrow to buy more.

Below 60 cents, so damn cheap after Bumi Armada has significantly derisked with Kraken final acceptance. Kitchen sinking also done - next QR is likely to have sparkling results with strong profit again - that's when the "profit growth" investors come in.

I wish I have more funds (may consider margin facilities) to buy more.

Kenanga Report - basically lenders will only have the right to demand full immedate repayment of borrowings if final acceptance of Kraken is not achieved. Basically, this implies that there will be no liquidity pressure.

"Finance impact from final acceptance. Following the final acceptance
of Armada Kraken FPSO, we understand the company has now
mitigated risk of default for the RM1.9b borrowings involved in Armada
Kraken (i.e. should final acceptance not achieved, the lenders could
exercise their right to demand immediate full repayment of the
borrowings). Additionally, we believe ARMADA will also be receiving the
full charter rates for the FPSO post-final acceptance (albeit possibly at a
lower-than-original rate after renegotiations in AA2), as opposed to a
discounted rate pre-final acceptance, thus leading to improved earnings
visibility and cash flows from the FPSO. All-in, we bumped our FY18-
19E earnings by 12% each after increasing our charter rates
assumption following the full acceptance of Armada Kraken FPSO."

I'm just a bit surprised of how the Maybank analyst can have such a drastic change in opinion of Bumi Armada within a month.

On 6 Aug 2018, Maybank released a report with a TP of RM1.02, when TGT1 extension news came out:

Maintain BUY and MYR1.02 SOP-based TP
Securing charter extension for FPSO TGT1 for another 6 years is a major
positive, for it reflects the quality of the asset/ operations and viability
of the operating field, Te Giac Trang (TGT @ White Rhinocerous). The
charter rates are also within our expectation. Our earnings estimates are
unchanged. We remain positive of the FPSO sector and we do not rule
out BArmada winning a job this FY, which would be a positive.

Inexpensive valuations
We are optimistic on FPSO operators. The FPSO tender pipeline is visible
this year and BArmada is prospecting for 2-3 firm tenders in Africa and
Latin America. Winning one job this FY would be a positive.
Notwithstanding that, BArmada is also pursuing a redeployment
opportunity for FPSO Armada Claire. At current price, BArmada’s
valuations are attractive from PER and PBV perspectives.

Then, one month later, on 11 Sep 2018, Maybank released another report with TP of RM0.55:

Maintain HOLD and MYR0.55 TP
With the Kraken issue resolved, working on its balance sheet is
underway. It needs to de-gear to progress and in our view, do a cash call
for new job wins. We reiterate that until these matters are addressed,
BArmada is a HOLD. Our TP is SOP-based.

The debt issue has always been there with Armada and it's nothing new. It's not like Armada incurred the debt in the 1 month between 2 reports. Did Maybank not know that there's a debt repayment due soon if Kraken final acceptance is not achieved when they released the report in Aug 2018? I doubt so.

I think the key takeaway is to take these analyst reports with a pinch of salt. Read the data points rather than their opinion (their guesses is only as good as ours).

Goodluck everyone!

Market is just cautious on the refinancing of the US$500m debt from short term to long term, with the first tranche due in Oct.

Given the sequence of events, and the urgency of Armada in securing the final acceptance of Kraken, it is highly likely that the Kraken final acceptance is a condition precedent negotiated with banks for refinancing the debt to long term to ease liquidity pressure.

I'm speculating that the refinancing is now in progress.

Accumulate!

yes, buy and hold.

risk reward ratio looks very attractive now.

the overall market sentiment is a bit bearish now due to potential trade war escalation by the US, and this is possibly why the share price hasn't rocketed up yet.

Analyst reports will take a day or 2 to come out due to the long weekend, takes another half a day for fund managers to process the reports and take action.

Use this opportunity well, move before others move.

First analyst report out by Jefferies - Kraken's final acceptance is a "huge positive to the stock's sentiment, as a major overhang is now lifted."

TP: RM0.95

BAB announced that it has secured the final acceptance for Armada
Kraken. This is a huge positive to the stock’s sentiment, as a major overhang is now
lifted. Furthermore, the concern over its short-term debt should be alleviated as the
group is now in the position to restructure its balance sheet.

Final acceptance for Kraken secured at last
After much delay, BAB has finally secured the final acceptance certificate for Armada
Kraken. This was following the additional amended agreement entered into with its clients,
which allowed the project to progress on a more defined basis, by achieving commercial
consensus on the technical requirements to facilitate receiving the certificate. This is a
huge positive for the group as a major overhang over the long-outstanding issue is now
lifted. This leads to more certainty in its future cashflow as it enables BAB to recognise the
full charter rate from the contract, vs. 70-80% previously.

Balance sheet should progressively improve
With the final acceptance for Kraken now in hand, concerns over BAB’s balance sheet
should be alleviated going forward, as the restructuring of its loan could effectively take
place. Specifically, non-current borrowings of RM1.9bil for Armada Kraken, which was
classified as current liabilities pending the final acceptance, should now be reclassified as
non-current. Furthermore, BAB should now be able to refinance the RM2bil short-term
unsecured loans, and more importantly, drawdown on its multi-currency Euro medium term
note programme of USD1.5bil at more favourable rates following the final acceptance.

still holding. will hold longer given that kraken final acceptance has finally been achieved.

So far, CIMB, Public Bank and Affin all quoted final acceptance of Kraken within 2 weeks.
Let's see.

Affin Hwang Capital: TP: RM0.66

Bumi Armada’s (BAB) share price fell by 22% after an impairment surprise in its 2Q18 results following disclosure of the latest amended agreements (AA2) entered with EnQuest for FPSO Kraken. BAB is also required to pay an additional sum of US$25m to EnQuest (which we believe will be the final sum). We believe the sell-off was overdone, as 2Q18 core profit was flat sequentially, and we believe the worst is definitely over with better clarity now on Kraken’s final acceptance. As such, we maintain our BUY call, but with a lower TP of RM0.66.

AA2 Seen as a Problem, But Actually Helps in Faster Acceptance
The impact from AA2 signed is 2-fold – a RM478.9m impairment charge (relating to client contigent liabilities over Kraken’s contract period in the event modification work fail to happen), and an additional US$25m to be payable to EnQuest in 2018. BAB recognized US$12.5m with the remainder to be spread across the following two quarters in 2018. To our knowledge, the old contract was very rigid with difficult conditions to be met in order to receive acceptance. The revised AA2 provides better clarity with amended terms, making it much easier to achieve the final milestone. While Kraken’s final acceptance date was not penciled down in the agreement, management is, however, more optimistic on achieving within 2 weeks. While appearing negative on the surface, this short-term pain will bear fruit with a quicker final acceptance, in our view. We also gather that BAB will be able to write back part of the impairment charge once the modification work on Kraken has been completed. Although impairments were provided following the AA2 signing, the work does not fall under the final acceptance scope and as such does not affect the delivery date.

Public Bank, TP: RM0.67

On a positive note, the Group has reported that its subsidiary, Armada Kraken Pte Ltd has entered into Amendment Agreement Number Two (AA2) with Enquest Heather Limited, EnQuest ENS Limited and Nautical Petroleum Limited in relation to the Armada Kraken FPSO.

With the AA2, we believe both parties are in the final stages of firming up certain terms towards the Final Acceptance tentatively in September.

Cool, point taken, thanks.

Back to 0.555 with strength and strong volume. Fairly good technical rebound from overselling.

Let's hope the institutional investors rationalize further over the long weekend that AA2 paves a clear path to final acceptance of Kraken sometime in September as guided by CIMB.

Have a good long weekend everyone.

if AK offers RM0.7, he's really be privatizing Armada at a steal I think.
Kraken's perfect storm that tanked share price by 25% over 2 days to 0.525 was super oversold.

My earlier entry price was RM0.75 2 years ago, sadly.
Accumulating now to lower average price, probably weighted average is sub RM0.7 now.

I hope armada issues an announcement giving more clarification on AA2 and the timeline guidance for Kraken final acceptance.

CIMB is the only report that clearly states that "BAB expects final acceptance within two weeks", while all the rest of the analysts are really vague about the timeline and seem like they have no clue at all.

Armada looks like a good target to be privatized now at this share price lol, offer RM0.70 per share to take everyone out, fix the company, restructure and deleverage for 3 years and relist in 2021 when the O&G sector becomes red hot again.

Problem is if AK indeed did lose US$7bn in Aircel, then he'll be a bit stretched to do Armada's privatization.