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ramisle

ramisle
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  • Decline In Box Ships' Share Price Creates Rare Opportunity [View article]

    It's right there in his article.
    The number of TEU (Twenty foot equivalent units) is the size of the ship.
    Jan 20, 2015. 04:32 PM | Likes Like |Link to Comment
  • Has DryShips Hit Rock Bottom Yet? [View article]
    I do believe I'm getting tired of fact checking these relentlessly worsening articles about DRYS.
    I think someone must hand out a list to these guys, of stocks that they can make up some story about, and they are guaranteed to get clicks on.
    In fact, the more mistakes they make in the article, the more clicks they get, the more pennies they "earn".
    We just paid for this guys beer.

    I'm going to go get a bourbon.
    Jan 9, 2015. 07:40 PM | 4 Likes Like |Link to Comment
  • Decline In Box Ships' Share Price Creates Rare Opportunity [View article]
    Yes the life expectancy is 25-30 years.
    But at twenty years old these ships are due for their fourth special survey. That's an expensive one with even more stringent repairs, and replacement. And given where rates are, most companies have been electing to scrap them. Look at the recent history with DCIX and TEU. When the lucrative sale-leaseback charters expired on 20 year olds, they scrapped them.
    The big liner companies sold off those ships with a sale leaseback that allowed the Liner company to get a very high sale price, much higher than the market price for that age ship, and in return gave TEU a much higher than market charter rate. I remember when those charters were signed, nobody was paying anywhere near $26,000 per day for that size, and that age ship.
    It allowed TEU to have nice revenue for the dividend. And it gave the Liner companies cash for their new build program.
    It also left TEU with an unrealistic book value, as you noticed.
    The Liner companies have changed the plan.
    Maersk outlined the plan to cut costs and increase efficiency. They are using the 10,000 - 19,000 TEU ships to handle the East West traffic, They also plan on using the Suez Canal and pretty much leaving the Panama Canal out of the plan, even with the expansion.
    This will have a cascading effect on the smaller ships leaving them to handle the North South trade. The big ships will unload at Hubs in the Mediterranean and the smaller ships will deliver on short routes from there. American ports are being expanded with new cranes and dredging now to handle the bigger, wider ships.
    The old Panamax ship is obsolete, it's narrow beam is very inefficient.
    The under 10,000 TEU will still be have plenty of work, but with the big ships doing the bulk of the work, the smaller ones will be oversupplied, and the Liners aren't going to pay very much in charters.

    I have no faith in 10 year averages. 2001-2008 was an anomaly. Yes shipping is cyclical, but China's growth was second only to the Industrial Revolution.
    After China was admitted into the WTO, the growth in trade was unprecedented, and the dry bulk and container fleet was unprepared and inadequate to handle it.
    But they caught up, and now the shipbuilding capacity is far more than anyones most optimistic expectations for growth in demand.
    Sure, things could improve for the rest of their ships over the next two years, but I'd be absolutely shocked if they throw dry dock money on those two old ships, just to lease them out at barely break even charter rates. I don't think the big liner companies will rent them with all the choices out there. They cost more to run.
    But good luck with your trades.
    Jan 8, 2015. 08:21 PM | 2 Likes Like |Link to Comment
  • Dry Shipping: Where We All Went Wrong And How It Could Be Back With A Vengeance [View article]

    Unfortunately, it isn't likely that the owners are feeling that remorseful.
    Too many of them wear two hats. One, the CEO of the public company that owns the ships. And, often they own 100% of the private management company that makes more commissions by managing more ships.
    George changed his commissions from a percentage of the charter, to a flat fee.
    When 5% of a $100,000 per day charter, became a $10,000 per day charter.
    Not to mention a 1% fee for "overseeing" the building of the new ship.
    A commission for the purchase.
    And .2% for arranging the financing.
    Jan 7, 2015. 08:29 AM | 1 Like Like |Link to Comment
  • Dry Shipping: Where We All Went Wrong And How It Could Be Back With A Vengeance [View article]
    This is a very transparent sector. There may not be signs telling you when the bottom will happen, but there is plenty of information to form an informed opinion.
    It's all about the oversupply of ships. You may hear that the new demand for cargoes will finally outweigh the new supply of ships sometime this year or next, but that doesn't get rid of the 20% oversupply that exists now. So rates will remain low. Except for the brief, seasonal rallies.
    The expectations of a healthy increase in demand from China was real.
    China's imports of iron ore were at 846 mn tons at the end of Nov. And the total imports for 2014 will be around 900 mn tons. That is 15% more than 2013. Which exceeds expectations.
    Again, the problem is with supply of ships.
    There are several sources to let you know the expected delivery of new ships, and the scrapping numbers or the the reduction of the fleet.
    New orders slowed in 2011, and 2012, only to be followed by 100 mdwt being ordered in 2013. They will be launched in 2015, and 2016.
    Proof that the CEO's are not the people to listen to when searching for information about the future of shipping.
    There are only a few companies with low debt and low expenses that will survive in a low rate environment. Some locked in some decent charters during the good times. The ones that put all their ships on spot were looking for a huge rally, and got burned badly. I don't know what they were thinking. The new ship order book is readily available, and that is a reliable "sign".
    Anyone looking for a massive increase in demand due to an improved economy, haven't been paying attention. The seaborne transporting of raw materials has resumed setting new records every year since 2009. There won't be a "catch up" phase. There will only be a steady increase in demand, and the supply of ships won't be on par until they stop ordering new ones over a couple of years. Now that the fleet has doubled since 2008, then there really is only 10% of the fleet that is over 20 years old, old enough to deserve scrapping.
    Again, very few companies are healthy enough to survive. Actually, TBSI, EXM, GNK, and EGLE, survived. It was the shareholders that got wiped out.
    You can always rely on the Fall rallies in the BDI, and everyone gets excited, and the stocks rally. Don't stick around too long, the BDI crashes at the end of the year.

    In case you missed it, the Cape rates did rally 25% in the third quarter, just not as much as some were expecting.
    Jan 6, 2015. 03:59 PM | Likes Like |Link to Comment
  • Decline In Box Ships' Share Price Creates Rare Opportunity [View article]
    The two 20 year old ships whose charters expire in May and June will be scrapped. And that is over $50,000 per day in revenue that TEU will not be earning. That will leave them with only one ship with an above market charter. All of their other charters are losing money.
    The rumor that things are improving for the small and mid sized ships is greatly overstated, especially when it comes from CEO's.
    If there is a bankruptcy, or restructuring, don't be adding up the asset values to see what shareholders will get. There have been several restructures in shipping lately, and the end result is the lenders get taken care of, and the management continues to manage the ships, and the common shareholders get wiped out.
    The projected increase in demand for containers for 2015 is 6%.
    This is what Lloyds has to say about the massive amount of new ships hitting the water over the next two years, to an already oversupplied sector.

    "According to Lloyd’s List Intelligence, more than 1.9m teu is set to be added to the global container fleet next year.
    This represents an increase in the total container fleet of 10% and many of these vessels will be in the larger size categories.
    Some of this increase may be offset by scrapping activity, but deletions are unlikely to exceed the record levels recorded in 2013 when 2.7% of the fleet was sent to the breakers' yards.
    This year a further 2.3% of the containership fleet was scrapped.
    Next year, we expect a further slowdown in scrapping activity with 2% of the fleet projected to be sent to the breakers.
    All this means overall net fleet growth for 2015 will come in at 8.8%, exceeding demand growth of an estimated 6%-7% and heightening the overcapacity situation.
    Jan 6, 2015. 09:49 AM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Expenses [View article]
    I still don't see how you can include the expenses of Navios Holdings Logistics.
    Or at least add in the barges they own for per ship basis.

    So, I'll give you the numbers.

    The time charter and voyage expenses from drybulk vessel operations decreased by $4.0 million, or 9.3%, to $39.1 million for the three month period ended September 30, 2014, as compared to $43.1 million for the three month period ended September 30, 2013. This was primarily due to a decrease in charter-in available days (as discussed above).
    Of the total expenses for the three month periods ended September 30, 2014, $33.4 million, were related to Navios Logistics. The increase in time charter, voyage and logistics business expenses related to Navios Logistics was mainly due to an increase in the Paraguayan liquid port’s volume of products sold.
    Direct vessel expenses increased by $4.4 million, or 14.0%, to $35.8 million for the three month period ended September 30, 2014,
    Direct vessel expenses include crew costs, provisions, deck and engine stores, lubricating oils, insurance premiums and costs for maintenance and repairs.
    The direct vessel expenses from drybulk vessel operations increased by $3.8 million, or 41.9%, to $13.0 million for the three month period ended September 30, 2014,
    Of the total expenses for the three month periods ended September 30, 2014, $22.8 million related to Navios Logistics.

    General and administrative expenses of Navios Holdings are comprised of the following:

    Drybulk Vessel Operations $4,006,000

    Logistics Business $3,778,000
    Dec 18, 2014. 07:31 AM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Expenses [View article]

    Using the Gen and Ad fees for the dry bulk and tanker of DRYS is one thing, but you have used the Gen and Ad fees for ORIG also in that $48 million.

    The Gen and Ad fees for the DRYS dry bulk and tankers is $15 million.
    Dec 18, 2014. 07:05 AM | Likes Like |Link to Comment
  • DryShips: What's Happening Here? [View article]
    TNK, NAT and FRO are all tanker companies, hauling oil.
    And the low oil prices are causing customers to buy, and ship a lot of oil. Tanker rates have doubled and tripled lately.

    DRYS has 39 dry bulk ships, and voyage charter rates for dry bulk are crashing.
    DRYS Capes are mostly on very good period charters.
    Panamax voyage rates have not been as volatile.
    DRYS also owns 10 tankers, but most people associate them with the dry bulk market. Tanker earnings will be a nice boost for DRYS this quarter.
    People have given a lot of value to the 78 million shares that DRYS owns of ORIG, and the value of those shares have been cut in half lately.

    The reason that people are selling off ORIG, is that it is believed that oil companies will not be willing to pay $600 k per day to hire a drill ship, with oil dropping below $60 per barrel.
    ORIG has a good backlog of contracts to drill through next year, and beyond.
    However, there is no guarantee that those contracts will be honored.

    SDRL, another driller, just cut their dividend, that scares people.
    DRYS gets $15 million dividend per quarter from ORIG.
    Dec 15, 2014. 05:27 PM | 1 Like Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]
    I wasn't trying to suggest that those aren't the real revenue numbers for NM.
    At this point the logistics business is 100% owned by Navios Holdings.
    I just complained that those numbers skew the revenue per ship.
    Dec 15, 2014. 03:59 PM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]
    If you are going to use todays share price, then you have to use todays share count.

    The book value you stated is for all assets owned by DRYS and ORIG.
    DRYS only owns 59% of ORIG.
    But you shouldn't use that either.
    DRYS has no rights to the ORIG ships. There are no cross defaults, the Banks that lent money to ORIG made sure of that.
    The ORIG ships are not to be used as collateral for DRYS debts.
    But DRYS uses shares of ORIG as collateral on their debts. That's what they own, and since the value of those shares have fallen, DRYS is in danger of being in breach of those covenants.
    What DRYS owns, is 78 million shares of ORIG, worth $700 million at todays price.

    That's the only way that the Banks will measure DRYS assets, so it doesn't make sense to use some convoluted number from Yahoo Finance.
    How would you figure book value per share?
    Use DRYS 700 million shares outstanding?
    Use ORIG 131 million shares outstanding?
    Some combination of both.
    You have to separate the companies.
    Dec 15, 2014. 03:53 PM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]
    That would be fine if you were just comparing companies and their revenue.
    But since you emphasize revenue per ship, and revenue per dwt. then it really isn't a fair comparison.
    Break even rates are very different for tankers and containers.

    And in the example of NM, you have included a huge amount of revenue from the logistics business which really threw off you revenue per ship for them.

    It wouldn't be that hard to just take the dry bulk numbers for all companies from the SEC filings.
    Dec 15, 2014. 03:24 PM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]
    DRYS just sold 250 million shares of stock.
    They now have 700 million shares out.
    Dec 15, 2014. 03:09 PM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]

    No wonder you have NM with such high revenue per ship.
    You included the revenue for their Logistics business.

    Revenue: Revenue from drybulk vessel operations for the three months ended September 30, 2014 was $73.5 million.

    Revenue from the logistics business was $79.1 million for the three months ended September 30, 2014 (ii) a $6.4 million increase in the barge business mainly following the commencement of operations of three new dry cargo convoys under time charter contracts during the second quarter of 2014; (iii) a $2.8 million increase in the cabotage business and (iv) a $0.7 million increase in the port terminal business.


    Consolidated Earnings reports seem to be the downfall of many articles here.
    Dec 14, 2014. 05:43 PM | Likes Like |Link to Comment
  • The Dry Bulk Industry: Q3 2014 Comparison Of Revenue And Income [View article]

    The revenue for DRYS 2nd quarter dry bulk and tanker was $86,240,000
    DRYS shares outstanding is wrong.
    DRYS market cap is wrong.
    DRYS book value is wrong.
    Dec 14, 2014. 01:48 PM | Likes Like |Link to Comment
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