You are truly a fool. GNK has positive cash flow which means they would be unlikely to declare CH 11 until March 2014 at the earliest and it would be April at the earliest before any form of bankruptcy could be filed. Any action GNK takes on for payment of debt or restructuring prior to them will be welcome by me. Last minute negotiations do not always go well during an upswing when creditors would like to take the equity position of a company.
A 30% commission would be amazing if it was true. But it is not. Total expenses for the period are lower than that amount and the total project cost was 600M as per the latest SEC filing. If GC can procure a 7th Generation drill ship for only 480M he would deserve a 30% commission.
Anyone notice that the BDI rates are about double what they were this time last year on all classes of vessel?
They could make 40M with cash on hand. They need 220M by end of March and to work out any issues with their convenants.
Even with 4:1 equity dilution of equity they would be priced nicely based on market cap to total deadweight, debt to deadweight, and price to sales. I am concerned that with rising ship values and positive cash flow, debt holders will want to take over the company to make a bundle. The reason I was not worried about bankruptcy in the past is that the massive losses were not something debt holders would want to take on. GNK should be looking at alternate forms of funding and pay off current loans if necessary to cover some holdouts. Buying your way out of a loan is expensive but the debt holders will hold all the cards as March approaches.
Thanks. I appreciate your response. That must be the case. It still seems odd that the 50% or greater rule related to consolidated balance sheets applies to a 14% ownership, but I guess the spinoff is the key to that. It is also seems odd that I do not see a "minority interest" entry in the equity section which I would have expected for that type of consolidation. I noticed that there is a minority interest entry in the liabilities section only, which seems misplaced for a consolidated balance sheet which normally shows the consolidated assets and liabilities with the minority net equity documented in the equity section. With fluctuations in FMV or vessels and consolidated balance sheets for small ownership percentages I find it very hard to read the financial statements.
I hope so. The DYP settlement is stalled since DYP could not be served by the court. There may be a lack of cooperation by the Chinese government.
In the 3rd quarter 10-Q balance sheet and in financial summary GNK states they have 119M of cash including BALT. Maintained cash position of $119.6 million on a consolidated basis, including restricted cash;
$57.7 million at Genco Shipping & Trading Limited, including restricted cash;
$61.9 million at Baltic Trading Limited; and
If you go to the BALT financial site they have 61.9M of cash as of 9/30. However GNK only owns about 14% of BALT after the equity offering. How do they count all of BALT's cash as their own?
You have a $3 stock. Why go with options. I agree that the stock is undervalued with ORIG alone accounting for 130% of its market cap but I do not know how long a stock price turnaround may take. We have a positive demand to supply picture through 2015. Why not just buy and hold?
Why do you think that third Q earnings will be great. The BDI only went up in September and September's average rate is lower than the close today. They lost cash flow the other two months. October is already locked in as twice as good as September. Any real earnings will come at the end of the year, not in the 3rd quarter earnings announcement.
Not good for us. One shareholder will take the entire settlement amount, draining the company of cash.
That is correct. The average recovery is .33 per share or .21 after attorney's fees but actual recovery amounts depend on cost basis. It must be postmarked by Oct 9 which will happen if the mail man picked up the mail on that day.
Right, a dollar of DRYS buys 1.26 of ORIG now with the dry bulk and tanker business for free. If GE dilutes DRYS ownership 200M that ratio goes down to about 1.1 of ORIG and DRYS for free but it is hard to argue the dry bulk business has no value if the debt owed in 2014 is paid off. I think ORIG will go up in 2014 when it appears all ships will produce revenue, but 4th Q will suffer from movement of Skros and Athena. I am a little concerned about the cyclical weakness in dry bulk for the 1rst Q but really like the two year dry bulk outlook for supply vs. demand particularly for capes which take the longest to build and have the smallest percentage under construction now (
Fleet value is around $1B now taking out the BALT ships. I used the following valuations. Their market cap share of BALT is 28M which they could potentially sell for cash. I estimate they are close to 70M in cash not with the last runnup of the BDI. Their debt is still about 230M more than their fleet value. Our hope is that fleet values continue to rise before judgement day on March 31, 2014 when $220M is due. We also have to hope their cash runnup keeps them above a 37M minimum cash balance if the BDI continues to drop. This is still a long shot but with hugh rewards if they can stave off bankruptcy though stronger ship values, BDI stability or improvement or cash through equity dillution. 4:1 dillution is much better than bankruptcy and would still give them a good market cap to DWT or fleet FMV ration relative to their peers. Anything is better than following in EXMs footsteps as they seem destined to do if we do not see continued shipping improvements.
Capes 9 $38 $342
Panamax 8 $17 $132
Supramax 17 $21 $357
Handymax 6 $16 $96
Handysize 13 $14 $182
53 $106 $1,109
It is actually only $149k (17 trillion divided by the 2013 census of 114M households). Does that make you feel better?
Many China stocks are way up. In my portfolio CNTF +10%, ONP +13%, XNY +45%, AOBI +17%, BSPM +19%. Shaghai index is down so mostly the micro caps moving up. Very odd.
I don't think you thought this out. The secondary is presumed to add value to the company or they would not have done it. Assume you own 50% of a company with only one asset ($100 in cash) and it has 100 shares trading at $1 each. A secondary offering takes in another $100 with 100 more shares (still $1 per share). You now own 25% of a company worth $200. In other words your value per share remains at $1 and you still own 50 shares even though your percentage of the company went down. If the secondary was timed right and added more value than the cost you will benefit even higher. If it was ill timed and added very little value you could lose out slightly.
I hope not. They will owe 220M by end of first quarter. They should be talking to the banks now.