Some interesting information from Bloomberg this morning ; World oil consumption (assumed) 34.4 Billion bp yr. Sales revenue at 2014 levels would have been $3.8 trillion US. ( brent + wti ) . Todays sales $1.4 trillion , a World loss of $ 2trillion US . Obviously this is completely unsustainable and cannot last . To have a sustainable world oil production that meets consumption and is able to fund future exploration and development . In other words , rebalance , oil will have to go back to at least $100 pb . Now the question is will the oil giants try to regain lost revenue and rebuild their empty coffers ? Well one would think so , at least over time , this would mean years of high oil prices to come . Where does that leave MRM ? Well as we know contracts and day rates are 50% down , yet revenue is still upwards of $300 ml hy report . So in a year or so when rates rebalance along with the op. MRM should report sales exceeding $1 billion pa. Now on to NPAT , this is a bit harder as debt reduction is paramount , still it would be reasonable to expect NPAT of $100 ml plus . at an average 15 x times we are looking at a possible $5.00 share valuation . So in a perfect world , with op. rebalanced , and a return of normal day rates , then with a return of normal divs. This may well be the best trade we have ever had !! Do you think 'BLACK CRANE ' may have got it right ?......Play the long game , could be a very large pot of gold at the end of the rainbow......
MRM Price at posting:
38.0¢ Sentiment: Hold Disclosure: Held
