This is what it comes down to. They clearly stated their break even rates for the rest of '15. VLCC $26.4k Suez $19.4k Keep an eye on the rates and you'll know whether or not to hold into next quarter. Oil keeps getting pounded, good for FRO
On CNBC today at 3;30 a spokesman was saying he spoke to several spot market OIL traders and he would not or could say "prices" but HE did say they are in a PANIC trying to sell oil. Did you ever think we would see the day that they are panicking trying to sell oil. WOW. --- W.E.J.
Make that four wins, green close today for members- these guys have been remarkable this year.
skidude that would sure explain an increase in cost if I was the moron then this moron thanks you for the information. As an investor on the board information is important and even some times a moron can learn from such an exchange.
Hey, I disclosed those DRYS shares were lottery tickets, they were not investments. And yes when you buy lottery tickets you have to assume risk and realize you could lose part or all of your investment. No different than pulling the handle on a crooked slot machine. But hey at least your not risking in what appears to be poor management effectiveness.
I still got my core position. I made 40 cents on a lot of shares. Some retail investors would love to have got that pop. I bought 4 stocks today with the gain on that 40 cent pop: DRYS, CHK, EXC, and BTU. So now I don't feel so bad after all, still got my core position and 4 other stocks. Thank you FRO investors for making it possible.
if you listen to the conference call, they were "very optimistic on 2015"... I read an article back sometime stating that if Fro eliminates the bonds, this stock value should be between $9-10 per share..... so I like the game plan and will ride the wave.....4 times the value I bought it at, I can handle it; reasonable odds on the plus side especially with the comments...
25 VLCC in the fleet, (currently 4 on charter, 21 on spot), from comments in the call, (which is still accessible on the Frontline website). I don't dispute they could provide more in depth info, but the lack of it is not, in my opinion, evidence of nefarious intentions.
Well, on FRO's website it lists the fleets ship names types etc. ; however, it does not list whether the particular ship is - on charter, to whom and the contractual rate terms - also whether the ship is on the spot market rather than charter thus each spot travel during the quarter would obviously be different - the report also does not provide for the quarter what was the average charter rate by Suezmax and VLCCF type nor what for the overall quarter what was the spot rates earned - I obviously would gather that spot rates given the short duration and higher risk would be higher than the respective chartered ships - I dont have the details as to what % by type are charter and % on spot. As a comparison - look at Seadrills fleet report and you will have an idea of what info that FRO could provide and is not. An exerpt from the 134 page FRO sec report is maybe helpful:
" We presently operate VLCCs and Suezmax tankers in the tanker market.
Our preferred strategy is to have some fixed charter income coverage for our fleet,
predominantly through time charters, and trade the balance of the fleet on the spot
market. Due to the very limited availability of time charter contracts, however,
our fleet is mainly trading in the spot market."
sean thanks for your information and it makes sense to me across the board. I confess I don't know what MSED is can you enlighten me? I did notice that FRO owns 3 other companies that have ships and charters as well I am sure that this too is captured in the quarter revenue report as well as the FRO2012 shares but I do not know if FRO2012 is paying any dividends which is the only way that revenue would show up for FRO holdings of them.
I do not see crooks in FRO like rails does and have invested in FRO because of Mr. F being in the company and I still value his wisdom on ships. However that said the charters were in force in the 3rd quarter as well as the 4th quarter and if anything less of them so there has to be yet another reason for the less revenue made in the 4th quarter than the 3rd all things equal same charters or less and higher rates higher do you see where I am coming from? Did they address fleet use? Again 3rd quarter had drydocked ships and 4th did not. Another puzzle to me at least. I think I better go back and listen to the broadcast as I still can't wrap my mind around the 3rd quarter with charters and drydocked ships beating the 4th in revenue. Charters yes to some degree and I know they chartered 2 ships for about 44,000 a day during 4th maybe more who knows.
Thanks again for insight and spirit of post. I believe that FRO should hold at or above 2.50 till next quarter which will give a clue to future. They do not blue sky you that is for sure.
I listened to the broadcast.
(1). The explanation for your Q4 v Q3 mystery essentially was much of the fleet was under pre-Q4 leases, the tail on those having FRO committed into Q4 @ the lower Q2/3 rates - so increased rates, (which took off in Q4), wouldn't be reflected in income until the existing leases expired at end of Q4, (which makes perfect sense).
(2). Q1 will most likely reflect better than you painted it for that reason.
(3). $50M remains to be plucked by FRO under the MSED.
(4). From here forward it's my OPINION - the way FRO has operated to date on the MSED, it will be toward end of March 2015 when they've exhausted the Distribution. (And share price will continue to drag while FRO scoops up that $50M).
THEN... assuming landscape remains reasonably within current parameters, the stock is more likely to start showing appreciation, as the April Bond payoff is realized, and the SLIGHT momentum continues to and after, the May Q1 call, (which will reflect the better income you expected in Q4).
And with contango still in play into Jun/July, and land storage is filled, (currently being reported as 1-2 months away), further appreciation will be in the offing, (tanker storage "kicking in" and keeping rates at a profitable level).
So for the coming 6-9 months, it won't be the Rocket Ride so many have wrongly imagined. But it IS going to be pleasant to cruise - at least into late 2015. IMHO.
I think you need to listen again. They were rightly concerned that the orderbook would grow (First impact would be 2017 at best) because recent experience has shown the stupidity of the Companies in growing fleets when rates look good (just look at Drybulk!).
The tone was annoying but to say they aren't optimistic about 2015 is just wrong. In fact the direct quote from the CFO was "Yes. As Robert said earlier on the call, I guess, we are quite optimistic about 2015." Their concern is 2017 and forward. We will see if owners repeat the stupid mistakes of the past.