Posted by supersaiyan3 > 2019-01-19 00:47 | Report Abuse

Great analysis.

Posted by lwyy60 > 2019-01-19 01:01 | Report Abuse

too high risk, provided Good q onward else who gonna save this sinking ship. Good luck all.

Posted by arv18 > 2019-01-19 03:45 | Report Abuse

Since dear felicity is a fundamental analyst, it would be good if the technical term 'enterprise value' is used somewhere, and not just debt and market value.

It is highly misleading to just say "Look ... WOW! ... So Cheap!" without fully accounting for cash and debt.

Posted by OrlandoOIL > 2019-01-19 08:39 | Report Abuse

So brave of CIMB to put a positive spin on d extension of d loan n for u to repeat n follow when Armada is not in a position to negotiate at all

Loan maybe restructured but it is not goin to be d same anymore

To exend banks wil probally set a term for part of d loan to b repaid now by selling off some OSV FPSO or other PPE n so thr is impairment risk here

Interest % wil very likely b higher as Armada is of higher risk now compared to whn d loan was first extended n FED has raised %

Even if extended n prolonged whr to get d cashflow as tat contract has bin terminated

Posted by value88 > 2019-01-19 09:59 | Report Abuse

If there is no fear, how can we make money in stock market ?
We capitalise on fear and we do not join the party of greedy people.

Posted by probability > 2019-01-19 14:52 | Report Abuse

aiyo...FPSOs need to install Scrubber to meet IMO 2020 requirement by this year...

huge CAPEX coming liao...

it will die thirst of cash flow for very very long ma...

kikiki

Posted by probability > 2019-01-19 14:53 | Report Abuse

by right...now only the fear should start...

Posted by Felicity > 2019-01-19 14:54 | Report Abuse

If one looks at the report by CIMB below, it is quite extensive. It is using Sum of Parts valuation some level of discount. To me, it is sufficient, for how it values the company, look at page 55.

https://www.cimbpreferred.com.my/content/dam/cimb-preferred/pdf/daily-brief/August2018/Msia%20Sect.pdf

Again, I am putting a higher perspective on valuation as Sum of Parts does not look at the intangibles which to me Bumi Armada is quite strong.
Again, I feel that as in past experiences, investors are very risk averse over companies with debt. Previously, there was a similar fear over Airasia. Look at where Airasia is today in its balance sheet. Today, Bumi Armada's case is slightly more severe than Airasia, but it has many options where it can solve its short term gearing and liquidity issue.

Posted by stockraider > 2019-01-19 14:55 |

Post removed.Why?

Posted by Felicity > 2019-01-19 15:03 | Report Abuse

I personally do not like Sapura because to me the sincerity is not there, his salary (RM70 million a year) and the support that they get from some of the local funds. I tend to shy away from companies like this.

That's my personal opinion.

Posted by stockraider > 2019-01-19 15:06 | Report Abuse

yes i heard pnb have talk with that fellow to bring it line with performance mah...!!

If not they/pnb would not want to be taiko to bank roll loh...!!

Posted by Felicity > Jan 19, 2019 03:03 PM | Report Abuse

I personally do not like Sapura because to me the sincerity is not there, his salary (RM70 million a year) and the support that they get from some of the local funds. I tend to shy away from companies like this.

That's my personal opinion.

Posted by Sniper86 > 2019-01-19 15:35 | Report Abuse

here comes the naysayers....if u think it is high risk, then step away from it...

Posted by OrlandoOIL > 2019-01-19 21:08 | Report Abuse

To justify d CEO crazy 70m fee one wonder if he has sacrificed Saprng's interest by lowing d profit margins of all d contracts won to win those contracts

Short term looks impressive wit winning lots of contracts but later all shareholders suffer with low or no profits

Posted by probability > 2019-01-19 22:18 | Report Abuse

8 FPSO + 44 OSVs = 52 units need Scrubber for IMO 2020 compliance
....................................

Cost = 3M USD per scrubber minimum including installation & commissioning
= 52 x 3M
= 156 Million USD

= 650 Million RM CAPEX
.......................

https://www.hellenicshippingnews.com/imo-2020-impacts-to-the-shipping-industry-an-experts-perspective/
Another alternative to LSFO is to install an exhaust gas cleaning system (EGCS) commonly referred to as a “scrubber” system. These are not cheap with prices being quoted of US$2-5 million but they allow the ship to continue to consume HSFO. With some analysts predicting a $400 per tonne premium for compliant fuels the payback time for some ships is less than 12 months.

Posted by probability > 2019-01-19 22:22 | Report Abuse

The above is a serious gaping hole on cash flow either via Capex before 2020 or via rise in Operating costs by the same amount per year from 2020 onwards if Armada had opted to use expensive MGO instead of installing Scrubber for HSFO usage on their vessel engines.

......

Till the above can be disputed / clarified by someone, Armada is certainly a no no for me...

good luck

Posted by LMKCPH > 2019-01-19 22:41 | Report Abuse

Are you sure that all Armada FPSO and OSV marine diesel engines operated with Heavy Fuel oil and not MGO?


















ion plants plants operated

Posted by probability > 2019-01-19 23:01 | Report Abuse

yes, i am pretty sure all vessels in sea of old design is catered for HSFO....

the price is way cheaper than MGO (refer above 400USD/tonne)...

its difficult to use MGO in ship engines as their viscosity is low...and also solidifies easily at cold climates...

its extremely dangerous to use MGO on engines as they risk of dripping inside the combustion chamber even when it is not burning...risking explosion when engine is started

Posted by LMKCPH > 2019-01-20 00:12 | Report Abuse

Please show your marine engineer's license - class 1 certificate of competency, then you can talk about marine internal combustion engines development. ha, ha, talk with facts please.

Posted by probability > 2019-01-20 00:14 | Report Abuse

you prove to me that these ships are using MGO lor...

Posted by LMKCPH > 2019-01-20 00:20 | Report Abuse

pls do not copy and paste all these IMO Rules and think that all rules are applicable to all vessels with checking others detail. There are many exe.ptions can be granted by Flag Administration of the marinetimd nation. Talk with facts , please

Posted by probability > 2019-01-20 00:20 | Report Abuse

u sound very stupid leh...the whole argument is because HSFO is way cheaper than MGO and thats why ships use these on their engines..

the whole objective of using a scrubber is to continue doing so (using HSFO)..

what the vessel owner loses in Capex is expected to be recovered by the savings in using HSFO...

if they are already using MGO...then they will be incurring high operating cost equivalent to the expected Capex every single year

Posted by probability > 2019-01-20 00:23 | Report Abuse

IMO’s 2020 sulphur deadline a done deal

It is now impossible for the IMO to push the 2020 global 0.5% sulphur limit to a later date without breaking its own rules. From January 2020 it will be illegal to run a ship using fuel containing more than 0.5% sulphur without operating an exhaust cleaning gas system.

https://webapp.sebgroup.com/mbs/research.nsf/0/E834E255E4EAC463C1258257006C2C69/$FILE/SEB_IMO2020_Report_March_2018.pdf

Posted by LMKCPH > 2019-01-20 00:24 | Report Abuse

please do not bullshit without facts here, if you are a ship operator, you will not talk like kaki lima man

Posted by probability > 2019-01-20 00:26 | Report Abuse

if you want to talk with facts, show me the news letter, the prove.

shall i believe you or the whole IMO organization?

You expect me to belive your bullshit with 5 post id...fxxk off.

Posted by probability > 2019-01-21 00:20 | Report Abuse

Containership scrapping set to spike as IMO 2020 looms

17/01/2019

https://theloadstar.co.uk/containership-scrapping-set-to-spike-as-imo-2020-looms/

Most analysts predict that the difference between HFO and LSFO will be in the region of $200 per ton.

Assuming that scenario to be the case in January 2020, shipowners could in theory recoup the cost of their investment in scrubbers within a few years, depending on the size of ship and its trading pattern.

But these same scrubber economics will not apply to elderly ships with asset values that are not significantly in excess of the cost of installing the onboard refining systems, which could be up to $10m a unit.
..........................................

It is therefore expected that non-operating owners of older tonnage will renew their interest in scrapping as the year progresses, thus providing a boost to the demolition market.

And scrapping will also be on the agendas of ocean carriers as they brace themselves for IMO 2020.

Posted by 10154899906070843 > 2019-01-22 23:14 | Report Abuse

Very interesting information probability, I had not anticipated such a requirement in my investing in yinson.

May I humbly ask if it is possible to redirect me to more information on this scrubber thing?

I would like to read further, it is very interesting requirement and would be very damaging to short term earnings of FPSO.

Posted by qqq3 > 2019-01-22 23:27 | Report Abuse

1015....don't worry la....FPSO is not a ship.....your Yinson safe la.

Posted by qqq3 > 2019-01-22 23:28 | Report Abuse

YINSON is ring fenced....they never built any thing without very tight long term agreements with good clients.....they don't have counter party risks.

Posted by amet2017 > 2019-01-22 23:32 | Report Abuse

FPSO diesel generator engine (generating electricity) is using MGO/MDO. HFO is used for main engine to propel the FPSO (in the case of self propelled FPSO).

OSV use MGO/MDO not HFO

Posted by qqq3 > 2019-01-22 23:41 | Report Abuse

so many experts...I better keep quiet....

I still think u worry too much....

Posted by qqq3 > 2019-01-22 23:42 | Report Abuse

u think Yinson shareholders idiots meh?

Posted by qqq3 > 2019-01-22 23:46 | Report Abuse

the whole shipping industry and FPSO industry collapse meh ? That is not how the world works.