The entire report s@cks. Logistics:more capacity,more boats,less profit.
How much actually NM gets from restructuring? Net proceeds of 25.5 mil at current value?
In that case,why they don't collect the entire amount over the life of the contract?
Re the restructuring bits - I didn't have quite the same take on that part.
The 25.5 is the lump sum payout of the charters that were in default. The company gets this money "now" (-ish) as opposed to periodically over time. That is actually good for the company because the 8% discount rate is about what their cost of debt is (using the 8 7/8% notes as a benchmark). I think having the cash right now (as opposed to in drips and drabs over time) is preferable.
Note that part of the payment (11 million USD) was cash compensation. So the company gets that too.
As for Logistics - the capacity was just completed in October - let's give them time to make some money with it. I note that EBITDA kicked up a bit YoY to 13.2 vs. 8.9 last year.
I'm curious about the remaining insurance coverage profile. It looks to me like the restructuring is more for NMM (per the release NM has 41.2 million of charters covered, NMM had the remaining 175.8 million). What about the remaining charter insurance coverage? Additionally I'd like to know the tenure of the restructured coverage. What are the long term implications?
Otherwise, I think this development is a long-term positive for the company; keep chipping away at the debt. I'm hopeful that the market re-rates the stock considering the company's focus on managing the balance sheet.
I think the quarterly numbers might put some near-term pressure on the stock, so I'm curious how it will play out in the market.
Yeah, the miss will pressure the stock - I had it back on my shopping list at recent levels - perhaps it'll make me pull the trigger soon. This restructuring is a big deal, though, biggest structural move to NM in a while perhaps. Now I haven't read the details yet and you know I have faith in AF, but there's definately some 'splainin to do' (Lucy). I've been wary of NM because bulk has a long trough still to suffer and many of NMs bulker charters are not really very long. The longer ones were insured and would keep it afloat I told myself. I'm going to go read. GL