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Genco Shipping & Trading Ltd. Message Board

  • eshjg eshjg Oct 1, 2012 10:23 PM Flag

    GNK had negative $8m cash flow in Q1

    Q3 should be worse than Q1's number. Cash flow could be -$11m in Q3. GNK will run out of cash soon with the current BDI.

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    • Nonsense.

      At the 1st quarter cash burn rate it will be 6 **years** before GNK is forced to toss in the towel. 5 years if we use your number.

      From a cash flow standpoint, they have 2013 in the bag even at 1st quarter, or worse, charter rates. They'll have to revisit debt etc. in 2014 if rates don't improve.

      Is the stock worth $9. No.

      Is it going BK soon because of cash shortage. No.

      GNK might not be a blue-chip "investment", but it will be around for a few years minimum. There is money to be made trading the swings between euphoria and panic.

      • 1 Reply to semper_grumpy
      • Where do you get 5 years number? By the end of Q2, GNK only had $99M cash with $1.4B in debt. If it burn $11M cash each quarter, GNK will be at the same price with EXM in less than 2 years if it is still around.

        Based on BDI on Oct 4, the average spot price is less than $8000 per day. GNK lost cash $8M in Q1 when the daily rate is $10000. Now you can figure out why GNK will go bankruptcy if BDI keep the same as today for next 2 years.

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