Ann: Completion of Supply Base Sales, page-13

Nov 2016 is a lifetime away for MRM. That and he article was based on heresay and misleading figures anyway. But even if they're taken as fact, they're outdated.

For instance... MRM "...is considering a restructuring proposal aimed at shoring up its balance sheet, sources said"...

You'd think it's normal for any management to be thinking of a capital raising when things were/are that/this bad. They'd probably considered sweet talking the bankers, taking out to special dinners too.

What's important is what the syndicates have since demanded.

Did they call in the loan, thus forcing MRM to either call it quits or do a major capital raising?

No. It's the opposite of playing hardball. i.e. sell that base and slipway in Australia - it's currently not earning you guys much anyway, human resources costs are also high... use that other base in Asia, where it's cheaper. Get the cash, give it to us and we'll leave you alone, and extend the term by a further 6 months to total two and a half year... Things should pick up by then, hopefully.

Again, repeating here... but that's a sign that the bankers got their nuts in the vice. The same as those syndicates during the early 90s with Murdoch and his NewsCorp.

Here's what management said they've re-negotiated since that Nov 2016.

H1 Results Prez, 28Feb 2017.


i.e.
1. Replaced the $75M with a one-off $45M principal repayment by end of FY17. Mainly from sales of Aus. bases and slipway.

2. Any other asset sales will also go towards repaying the principal. (i.e. please, please, please sell assets/vessels you've identified, we'll wait).

3. Term extended by 6 months, pushed back to end Sept. 2019. (we'll give you 2.5 years to cope).

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How has MRM progress in meeting these conditions?

15 June 2017: Completion of Supply Base Sales

ie. Will realised approx. $44.1 and $8.7M, or $52.8M will be paid to the Syndicate. Well above their required $45M minimum by end of June.

There's also 5 vessel sales that was in final negotiation back in Feb/April? The proceeds too will go towards principal repayment.

Let say that each could fetch $5M? So that's $25M? Total repayment could foreseeably be $70M?

That's very close to the original $75M the Syndicate would want anyway, just a little delayed, maybe.

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How much interest-bearing debt does MRM owe at Dec 2016?

Current: $112,500
Non-current: $287,826

At FY2017? Possibly:

Current: $112.5 - $70 = $42.5M
NC: $287M

BUT....

Two years prior to Jaya, MRM have $124M, then $135M in NC bank loans.
From memory, as far back as I've looked, they've always had this similar amount of LT debt, year on year.
i.e. it's not abnormal debt, it's simply operational debt a seasonal, capital intensive business like MRM need and will just roll over.

So that $287M NC debt could really be seen as ~$150M debt incurred for Jaya.

Either way, the syndicate have agreed to defer their claims by a further 2.5 years.

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COULD MRM STILL GO BROKE?

There's Inpex cash coming in; its base in Singapore already have work as claimed in the H1 prez.

There's that use-it or lose-it clause with time ticking to 3 years now since the crash. A typical lease put it at 5 to 10 years to get pumping.

So they better get a few boat and pretend to do some important work soon.

That and if a once $1Billion company like MRM could be reduced to a penny stock, how many other local operators you reckon could still be standing?