Posted by rohank71 > 2024-02-28 14:56 | Report Abuse

Karken failure has cashflow impact hence the collapse. this is just accounting impact on FA.

Posted by nikicheong > 2024-02-28 14:59 | Report Abuse

No Rohan, Kraken failure has no impact. This is unrelated. Kraken failure was recognized via lower revenue at that point in time already.

Posted by rohank71 > 2024-02-28 14:59 | Report Abuse

the decision to impair asset now is good so the future profit will b strong.

Posted by rohank71 > 2024-02-28 15:00 | Report Abuse

niki, Karken failure impacted the cashflow hence price dropped to 42 sen.. this is just accounting impact not cashflow.

Posted by Jonathan39199 > 2024-02-28 15:01 | Report Abuse

How the will profit be affected moving forward after the firm period ends?

Posted by rohank71 > 2024-02-28 15:01 | Report Abuse

let weak holders sell off.. which company has 1.5B cashflow per annum... that itself gives BA a strong footing

Posted by rohank71 > 2024-02-28 15:02 | Report Abuse

hope goes to 50 and we long term holder can load up..

Posted by stainlyho37 > 2024-02-28 15:02 | Report Abuse

taking some now.!!..operation look positive..impairment not too worry...as only on assets...

Posted by nikicheong > 2024-02-28 15:03 | Report Abuse

Still the impairment seems silly. Surely the carrying value should be conservative. I don’t see other FPSO operators facing this issue. Simply means we as investors need to be wary that Bumi Armada’s FPSOs carrying values are likely overstated on their balance sheet. Especially Armada Olombendo, which is their golden goose. I shudder to think what the impairment for that would be come 2029.

Posted by rohank71 > 2024-02-28 15:07 | Report Abuse

yes niki, very silly unless the management has other agenda. why now, when they knew it all along..credibility issue.

Posted by MM78 > 2024-02-28 15:10 | Report Abuse

Impairment means bringing the depreciation costs forward earlier hence future depreciation costs are going to be lower. Cash flow is not immediately affected negatively next few quarters before Kraken new extension contract kicks in after 1 April 2025. Armada still has about a year before the management finds new source of income though I cant see where can they find it.

Posted by rohank71 > 2024-02-28 15:16 | Report Abuse

Well said MM78

Posted by ITreeinvestor > 2024-02-28 15:55 | Report Abuse

this is the fact : Impairment means bringing the depreciation costs forward earlier hence future depreciation costs are going to be lower

Posted by zonefinder > 2024-02-28 16:11 | Report Abuse

A brief study of the financial deck given by Niki reveal that the "Impairment" is not what we normally understand as write down in value of the FPSO. What it is here is the adjustment needed to reflect the difference between the PV project cash value of the asset vs the NBV. The former is sensitive to prevailing capital cost ie interest rates while NBV is calculated base on the accounting policy on depreciation ie straight line. I suspect that they need to make this adjustment due to accounting convention ie has to provide for any known adverse impact. Note however that the cash flow for the next few quarters up to expiry of the Firm period will be a real shit load of cash as the Project loan for this FPSO has been fully paid up in March 2023. Even the cash flow for this project will more than during the first 7 years of the Firm period as there is no more finance cost ( for this FPSO) involved for the "Extension" period.

Posted by zonefinder > 2024-02-28 16:15 | Report Abuse

Whether there is any further such "Impairment" charges will depend on prevailing capital cost. However this is probably unlikely as likelihood of interest rate increases is low ...in fact it is expected to reduce...

Posted by zonefinder > 2024-02-28 16:17 | Report Abuse

What is now needed is for Project wins.

Posted by vespa > 2024-02-28 16:22 | Report Abuse

exhausted investors dumping

Posted by zonefinder > 2024-02-28 16:25 | Report Abuse

As for why BA is still not paying any dividends even though the business has been generating loads of cash is obvious. It still has net debt of 3.65B. Also need to conserve cash for future projects. Just simple good cash management.

Posted by Felix888999 > 2024-02-28 16:31 | Report Abuse

Treat it as mid term sales. Post CNY stock clearance. Lai lai warehouse sales warehouse sales!

Posted by ITreeinvestor > 2024-02-28 16:35 | Report Abuse

for bumi, always expect the unexpected

Posted by vespa > 2024-02-28 16:38 | Report Abuse

big boys have their trucks backed up to unload ...

Posted by vespa > 2024-02-28 16:41 | Report Abuse

dropkicks need to provide forward guidance Bursa ought to take note

Posted by MM78 > 2024-02-28 16:47 | Report Abuse

Big impairment at the most profitable quarter or year may have its tax benefits as it reduces the taxable income for the year. Is this one of the hidden reasons for the timing ?

Posted by Pakcik Kiah > 2024-02-28 16:50 | Report Abuse

Unending impairments.

Posted by zonefinder > 2024-02-28 16:53 | Report Abuse

Taxable income is not base on accounting policy on depreciation but on capital allowances on that particular asset...

Posted by sheep > 2024-02-28 16:54 | Report Abuse

tomorrow another bloody day..wakaka

Posted by rohank71 > 2024-02-28 16:56 | Report Abuse

#zonefinder, you are right.

Posted by zonefinder > 2024-02-28 16:57 | Report Abuse

Also on whether the Income tax dept recognizes this concept of PV Project cash value. If capital allowance for the asset has been fully claimed in the first few years, then the former has no impact on taxable profits

Posted by tallman > 2024-02-28 16:59 | Report Abuse

This Armada how many times already, QR boom, impairment, machine malfunction..... never ending story to tell bilis

Posted by nikicheong > 2024-02-28 17:00 | Report Abuse

Regardless, the depreciation in the upcoming quarters will be reduced. As such, barring any unforseen circumstances, FY2024 might just be the most profitable year, with each quarter's profits above RM250mil.

Let's see where this takes us. I do believe short of a disaster, long-term investors will still be rewarded at current share price levels (assuming zero new business other than extension contracts for existing projects).

Posted by nikicheong > 2024-02-28 17:01 | Report Abuse

Also, I have checked in with Navigator Gas, and according to them, there will be an update on the Bluestreak CO2 JV when their Q4 2023 results are released in the 2nd half of March 2024.

Posted by nikicheong > 2024-02-28 17:03 | Report Abuse

Another update, the Mumbai FSRU project is officially DEAD.

There is no mention of it in the Bumi Armada investor deck, and also SP Energy has removed the project from the "ongoing projects" section of their website.

Posted by curiousq > 2024-02-28 17:05 | Report Abuse

sifu said impairment, depreciation .... are on-going practice of this type of counters, bcos ware and tare of oil digger mechinaries are fast going

Posted by zonefinder > 2024-02-28 17:07 | Report Abuse

You are right, Niki. Not only profits but cash flow will be gangbusters as well.

Posted by nikicheong > 2024-02-28 17:10 | Report Abuse

@Zonefinder, cashflows will not change due to this "impartment" as it is non-cash in nature. However, the future profits are likely to be inflated at the cost of the tanking we saw today.

Posted by zonefinder > 2024-02-28 17:11 | Report Abuse

Once the share price stabilizes over next couple of days, time to load up for the long term investors.

Posted by Blue Tulip > 2024-02-28 17:12 | Report Abuse

Another Serba Dinamik and Sapura Energy in the making!

Posted by Felix888999 > 2024-02-28 17:20 | Report Abuse

This proven you don't know how to read the QR report.

Posted by Blue Tulip > 7 minutes ago | Report Abuse

Another Serba Dinamik and Sapura Energy in the making!

Posted by zonefinder > 2024-02-28 17:20 | Report Abuse

Niki, the cashflow is not impacted by "impairment" or depreciation but is affected by the fact that the loan for this project has been fully paid up....the cashflow for this project in 2024 is dramatic but overall has already been projected base on the expected debt reduction for BA as a whole.

Posted by Felix888999 > 2024-02-28 17:24 | Report Abuse

I hope Armada Sterling V won't drop another bomb shell from the final acceptance. 🤣

This naughty stock have to lock profit from time to time. Very very naughty 🤣🤣🤣

Posted by lloydlim > 2024-02-28 17:25 | Report Abuse

Wow!

Posted by nikicheong > 2024-02-28 17:27 | Report Abuse

Zonefinder, the Kraken debt had been repaid for some time now. I recall it was repaid in full in Q2 2023.

Posted by 8dragon > 2024-02-28 17:37 | Report Abuse

Next 0.48...

Posted by Macgyver111 > 2024-02-28 17:40 | Report Abuse

From 0.60 to 0.50...boom!..adoi!

Posted by zonefinder > 2024-02-28 17:56 | Report Abuse

Niki, you are right...fully paid up March 2023. Kraken project wise, the full benefit cash wise is 2024. Any case, we are looking at BA not just Kraken. Accounting profits will be shitty from 2025 if we do not get new projects to offset the drop in Kraken revenue of 70% during the extension tenure.

Posted by Felix888999 > 2024-02-28 17:59 | Report Abuse

This guy copy and paste the same statement every QR.

"Moving forward, we will continue to explore ways to enhance shareholder value, including new projects and possible corporate activities,” Christenson said.

Posted by nikicheong > 2024-02-28 18:15 | Report Abuse

Felix, I can't seem to find him saying that in the past.

Posted by Felix888999 > 2024-02-28 18:29 | Report Abuse

Haha haha that statement sounds very familiar. 😂

Posted by ITreeinvestor > 2024-02-28 19:16 | Report Abuse

this is the first time Gary talk about enhance shareholder value & possible corporate activities

Posted by nikicheong > 2024-02-28 19:18 | Report Abuse

Maybe Gary knows something we don't. Tank the share price, let his insiders buy, then announce some good news.