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SORL Auto Parts, Inc. Message Board

ladaniva 9 posts  |  Last Activity: 9 hours ago Member since: Jan 6, 1998
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  • The broader Russian market is down almost 2% while MTL is up about 24% on pretty good volume at around 8:00 EST. Maybe the talk of bankruptcy will be put to bed for good!!

  • Reply to

    2 bil of debt wiped out as ruble slides.

    by gerryfinesse Dec 15, 2014 1:38 PM
    ladaniva ladaniva Dec 16, 2014 11:24 AM Flag

    I'm not sure the ruble slide (or collapse may be more appropriate!) will be a net positive since 60% of MTL's debt is in dollars and euros so only 40% of the debt is impacted. However, because exports only account for 33% of total revenue, a big portion of their dollar and euro debt has to be paid from Ruble revenue. Also, the increase in interest rates on the Ruble debt (most of which I believe is variable and not fixed) will be significant in the next quarter. The way I look at it, this would be more or less a wash if the % of foreign currency debt was equal to the % of foreign currency revenue. In MTL's case, they only have 33% foreign currency revenue to cover 60% of foreign currency debt which means they need a lot more Rubles to cover the shortfall. It's obviously a lot more complicated that this simple overview but you also have to factor in the fact higher interest rates (now 17% base) willl have a dampening impact on local demand going forward. I remain a MTL long but events of the last week make me a lot less optimistic than I was a couple of months ago.

  • Reply to

    Ruble is at 56.40

    by derekjeter Dec 11, 2014 8:43 PM
    ladaniva ladaniva Dec 12, 2014 9:34 AM Flag

    Agree with you fully but it's all a matter of timing. It could stay down or go even lower in the short-mid term depending on a lot of interim factors like oil and gas prices, new sanctions, etc. Longer term, I'm a huge bull on the Rouble. For one, sanctions and the lower Rouble have been a major boost to many Russian manufacturing and agriculture companies as more expensive imports are being replaced with cheaper locally produced products. The cheaper Rouble is also going to be a major boom to Russia's exports to non-US and EU countries. I just saw this morning several countries (Thailand, India, Mexico and a couple others I can't remember) recently announced orders for Russian commerical jets. India is showing signs it will expand purchases of Russian produced military equipment. China, Turkey and South Korea are signining long term deals for oil and gas. While Russia may be losing out on business with the US and EU (mature economies with excessive debt that will drag down economic growth for decades), they are being replaced with new trade partners with potentially much higher growth over the next 20-30 years. Also, just look at the fundamentals of Russia compared to the "West" - Debt to GDP, Foreign Currency and gold reserves, budget deficits, etc. and Russia looks a hell of a lot better on both a balance sheet and revenue/expense basis.

  • Reply to

    ????????

    by bogota1co Dec 9, 2014 11:39 AM
    ladaniva ladaniva Dec 10, 2014 8:43 AM Flag

    Good move today in Moscow - Common up 12.5%, Pref. up 14.3%, both on decent volume. Also saw some pretty positive stuff from their financial results on the steel division which may prop up the coal side going forward until the market recovers.

  • Reply to

    volume has stalled

    by filixny Nov 5, 2014 1:12 PM
    ladaniva ladaniva Nov 6, 2014 7:32 AM Flag

    Big pop in price and volume around 1:00 pm Moscow time today. Common up 11% and pref up 16%, very heavy volume on the common and above average on the pref. Can't find any news so far but, based on today's action, I don't think the coroner has pronounced MTL dead just yet!!!

  • Reply to

    What a disaster this stock is

    by red_tsar Sep 26, 2014 11:27 AM
    ladaniva ladaniva Oct 26, 2014 8:02 AM Flag

    The ADR fee is effectively baked into the price if you look at the massive discount to the Common. Keep in mind, the terms of the preferred require a minimum dividend of 20% of net income (no such minimum for the common) and the big kicker is that the dividend on the preferred cannot be less than the dividend on the common. If you value both the common and preferred on a cash flow (dividend basis), the preferred should be trading at a big premium to the common since the preferred dividends are likely to be more than the common for some time to come and not less than the dividend on the common into perpetuity. Yet, the preferred ADR's are now traded at a discount of approx. 75% to the common if you factor in the 1/2 ratio of pref. ADR to th regular preferred shares. Even if you add three more years of carrying cost (approximately 9 cents in ADR fees), the preferred ADRs are still a screaming buy compared to the common. Note, I said "compared" to the common.

  • Reply to

    I'll give you $0.30 for 100 bags of MTL shares

    by red_tsar Oct 24, 2014 12:05 PM
    ladaniva ladaniva Oct 24, 2014 1:08 PM Flag

    How about I give you $0.30 for 100 bags of MTL shares? For a company that generated almost $1 billion of annualized cash flow in the first six months of this year and that paid every penny of interest and principal due on its debt, I'd like to remind everyone of the famous Mark Twain quote - "reports of my death have been grossly exaggerated"! As with Mr. Twain, the reports of MTL's death will also turn out to be equally exaggerated.

  • Reply to

    6 Month Financial Report out tomorrow

    by blackoutbuzz Oct 13, 2014 8:13 PM
    ladaniva ladaniva Oct 14, 2014 8:36 AM Flag

    Looks pretty good if you look at the six month operating cash flow of $475.7 million after payment of interest expense compared to $90.9 for the same period in 2013. Tells me bankruptcy is off the table. In this environment, not too shabby to be generating almost $1 billion per year operating cash flow.

  • Reply to

    What a disaster this stock is

    by red_tsar Sep 26, 2014 11:27 AM
    ladaniva ladaniva Oct 1, 2014 8:16 AM Flag

    What a difference 5 days makes!!!!!!! That three cent fee will look awfully cheap in another two years.

SORL
3.68-0.02(-0.54%)Dec 19 3:58 PMEST

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