I'm unsure what his plan is with MRM but it would seem that he's...

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ckchristian

1,759 Posts.

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15/08/16

19:18

Post #: 18522450
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Originally posted by Austinhealeysprite ↑

Hi Croasian.

In some previous posts I have talked about the industry. Including:

- Stacking of fleets. Some OSV companies are stacking, storing, 2 out of 3 boats. That means 2 boats are at best stuck in the weeds rusting away. The 1 boat that can find work is doing it at a low rate.
- The industry is ultra competitive. Boats are tendered in a cut throat manner. Boats are being tendered for cash operating costs only. No money for maintaining, no money for depreciation and certainly no return for shareholders.
- Trouble with the banks. MRM is taking to their banks and it's likely going ok. But that can't last for ever.
- Average revenues continue to drop. For reasons above even existing contracts are being lowered and any new ones are at low rates. We saw that with the recent ANN, more to come.

So overall this business is in really hard times and will continue to be so for a while. I think 2019 or 2020 will witness a bit of recovery (transocean the large US rig co are saying the same) but MRM has too survive till then and it's a fair bet that it will start burning cash via operations at some stage, and that is not sustainable.

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I'm unsure what his plan is with MRM but it would seem that he's happy with accumulating at these prices. Next week during the full year results capitulation of the SP I'm sure he will trigger 20% but then what??... Is it worth jumping on board in the hope of a takeover then?? IMO there will be a significant sell off next week but I'm also surprised there hasn't been a lot more shorting this past week and will be looking out next week. I would put this down to the inability to work out exactly what his intentions are...

It really is a tricky situation but the one thing that is certain IMO is the need for some capital. The last Announcement pretty much sums up the hard times to come for MRM.

GLAH

MRM Price at posting: 35.0¢ Sentiment: None Disclosure: Not Held
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I'm unsure what his plan is with MRM but it would seem that he's...

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