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  • play_tow play_tow Mar 7, 2007 3:40 PM Flag

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    There is the important issue of legacy earnings over the lifetime, and the value assigned to that.

    Take a simple example....Vessel A (5 yr old) vs Vessel B (25 yr old).

    Assume they are identical in every other way. Assume that the ships will retire at age 30. Assume that each vessel secures identical annual revenues, say $10M (equivalent to a $30,000/day TC).

    Life Time revenue for Vessel A : $250M.
    Life Time revenue for Vessel B: $ 50M.

    Now imagine an investment choice between 2 companies, whose only distinguishing assets are newer Vessel A for Company A, and older Vessel B for Company B.

    Clearly, Company A holds greater value based upon future earnings.

    All else being equal (i.e., each company owns their vessel outright, has same capital stucture etc), then one would value Company A higher than Company B.

    The difference in valuation would have to employ a discounted model of the future earnings, but the main point is that Company A would be more valuable than Company B, as a business enterprise.

    Its effectivley on this matter that one sees EXM trading at basically 1 x book value, whereas DSX, having a new fleet, trades at 2.7 x book.

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    • Not mired but I am justified!

    • Forget it honest, he's mired in self justification.

      BTW, if you're ever by Grosse Ile, wave for me, wouldja?

    • honeycut. The funny thing about all this is you agree with me. I just pointed out suspicious motive and everybody cried bloody murder. I have already contributed to this board more than enough. I never post until I absolutely have to and that is in response to foolish comments about paying a dividend and getting further into debt. I am protecting my investment but shooting down foolish advice. You actually quoted me when you agreed with not paying a dividend and why is everybody jumping up and down about EXM to pay a dividend when there are clearly all the other bulkers who do. So, to me, one who does not post much less read a whole lot on this board, I thought it was disingenuous of Audio to recommend EXM parrot what everyone else is doing to their financial detriment. Because that statement is true, I believe it painted audio in a bad light as it should. To recommend what recommended, when so many others are doing what he wants, is disingenuous. Funny part is he thinks I have blind loyalty to EXM for some reason. Not blind loyalty, actually very clear vision here. I just don't want these doing the wrong thing that will negatively affect my investment. If you read through the thread you realize how much negativity Audio is sending my way calling me names etc. It don't bother me because I looked through the thread over and over and all I see are sound points by me and aversion to questions by audio as well as twisting my words. I never said EXM was superior to DSX. DSX was never in any of my posts. I merely said in response to audio's assertion "that EXM was flat because of dividend or growth in their fleet, that it was hardly flat because it was within a dollar of a company that is nearly three times its market cap and does not even pay a dividend. THat point is clear made by looking at the facts. SO you guys cry all you want but my points are valid and they make sense while Audio, despite his reputation as the "stat -guy" for the bulker industry and playtow are wrong. Sure they could have bought some ships before they got expensive. But you know what....? They did not. So can now go forward with a sound and financially prudent growth strategy? Oh wait I think we just did with the blank check company, the same strategy that audio has been posting about the last few days.

    • Allen,

      Please give it a rest.

      This involves all of us here, because this is a public message board. The only way to exclude someone is by putting them on ignore. There is a sense of community here, focused on EXM, where we are trying to share information and opinions. Being rude to each other only impedes understanding. You are wasting your time and ours. If you are as angry as your posts seem to imply, than you are hurting only yourself.

      Please lighten up. I don't agree with many of the posts but there is no reason to get upset. I hope that you have something useful to contribute, but we may never know if you keep this up.

    • so please don't stick your nose in a matter that is not yours thank you sir

    • you could not help but to constantly reply. Have fun literally living your life on a message board. Oh wait. You spread your exciting life day in and day out over multiple message boards, spellchecking each and every one of your longwinded and numerous posts. Nice life you have there audio.

      I made my point about not going into debt further, you didn't obviously care how over leveraged this company is as long as they grow. You probably bought into the clicks not bricks dot com selling for suckers era. Either way, my money is invested in this company so I DON'T WANT THEM TO SCREW UP . WHy is that so difficult for you to understand is beyond. Carry on if you can audio.. Will your pride force you to respond? I think so. You post incessantly on this and many other boards not reply. I don't think you have it in sir. Also, I never called you names I said your decision making is suspect. You are the one that called names. So be prepared to be cursed with the same curse that you cursed me.

    • is hilarious long live vendelver, and audio, woooohooooo

    • I knew your pride could not keep you away from posting

    • Agreed. 'Scuse me for participating.

    • OK, thats it, i'm getting out the tranqualizer gun. Simmer down now :)

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