Time to off-load this Mermaid, page-30

I think it was you or another member that mentioned MRM's change of impairment policy at FY16: from earnings value to resell value, right?

So non-cash impairment over past two years was around $120M + $139M? From memory, the vessels itself were impaired by $200M. So let's be generous and assume that management got a proper industry expert to assess the resell value of the vessels, we can't really be that cautious and take another $300M (or half) off of its net tangible assets right?

That would mean we're taking over half a billion dollars off of a $1B company (asset-wise).

MRM's ships are relatively new - average about 7 to 10 years. They're not worthless or scrap value.

But true... if the lenders are cautious, or know their stuff, they might just put the ships down to scrap value and so demand further equity raising. But so far it seem they're comfortable enough to not call the administrator in.

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It's the non-cash impairment claims MRM is doing that I like about them. Not from a taxpayer point of view, but from an MRM-owner point of view.

For some reason, companies like MRM could just get a consultant in and assess what their assets are worth and then make claim of "losses". That mean they don't have to pay income taxes but also get a return.

So FY16's ~$13M tax returned for FY15 mean MRM didn't make a loss of $5M, but a profit of $8M. And the FY16 return should be higher and would have been returned already.

So if management can shove cash flows around, and if they were to win a couple more contracts next half... it might be tight but there might be no need for a cap raising to survive FY17.

anyway, I'll look up the numbers to have a proper discussion. So far it's just top my head rough calculation from memory.

I'll be patient as I did buy in at 40 cents just to watch it drop down to 20s. Not a feeling I'd like to repeat again. But then I've also been patient on what I thought were bargains just to watch it doubled in six months.

Guess this is why the smart monies just spread people's money around instead of trying to make concentrated bets.