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Linn Co, LLC Message Board

play_tow 231 posts  |  Last Activity: Mar 27, 2015 9:58 AM Member since: Dec 16, 2004
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  • play_tow play_tow Mar 27, 2015 9:58 AM Flag

    Yes....this is the situation...to an extent, but you've overstated somewhat.

    Concerning the capitalization issue, and the use of shares to fund expansion, STNG is no better.

    The straight-line depreciation of asset values over a 20-25 yr period builds in the loss in vessel values, so that shouldn't be over stated.

    This is a capital intensive business.

    NNA and STNG have atleast a shareholder friendly distribution of income, via dividends between 4-6% yield that is attractive. More so for NNA, who takes less risk than STNG.

    Also, keep in mind that NNA is now past its expansion phase, and is now seeking to pull in cash flow in the mid cycle of the tanker rate moves. The expectations by analysts is that MR rates through 2017 will strengthen, averaging between $18,000 to $19,000/day.

    If that were to occur, NNA has very strong cash flow coming.

    Most of that, AF indicated, will be used to deleverage the balance sheet, and prepare for the next cycle and fleet renewal.

    and repeat....that is the nature of this business

  • Reply to

    LPG is .......UNDERVALUED

    by ikkebinikke Mar 24, 2015 12:31 PM
    play_tow play_tow Mar 25, 2015 2:41 PM Flag

    I assume that net cash break-even on their VLGC's is closer to $20,000-$25,000, given financing costs

  • Reply to

    LPG is .......UNDERVALUED

    by ikkebinikke Mar 24, 2015 12:31 PM
    play_tow play_tow Mar 25, 2015 11:53 AM Flag

    good to know. Let's hope the upward direction ihe trend of all subsequent moves.

  • Reply to

    LPG is .......UNDERVALUED

    by ikkebinikke Mar 24, 2015 12:31 PM
    play_tow play_tow Mar 25, 2015 10:18 AM Flag

    some one read your msg. Please write more!

  • Re: Update on the convertible bond - Giant One Step Close ( Scroll down on market text )
    Giant One Step Closer --- from TradeWinds
    John Fredriksen took another step in creating a single giant bulker company today when Knightsbridge Shipping secured a secondary listing on the Oslo Stock Exchange.

    The move is part of a long-awaited merger between Knightsbridge and Golden Ocean that should be completed within in a couple of weeks.

    A special meeting of shareholders to approve the merger is set for this Thursday, with Oslo-listed Golden Ocean likely to be dissolved by the end of March.

    The enlarged company is then pencilled in to start trading under the Golden Ocean name in both the US and Oslo on 1 April.

    The new Golden Ocean will be one of the largest bulker owners listed in the US with 72 vessels to its name.

    Fredriksen first mentioned the idea of combining his two public bulker companies last year in an interview with TradeWinds.

    The shipowner later said in these pages that the merger "was only the beginning".

    Last week Knightsbridge completed the purchase of the final 12 capesize newbuildings from Frontline 2012, which will see that company become a pure-play tanker owner.

    Best medicine

    Herman Billung, who will be chief executive of the merged company, told Reuters today: “It’s pretty brutal what’s happening in the market right now, but in many ways it’s the best medicine for the industry.”

    He added: “Scrapping has been at record levels so far this year with 34 capesize vessels already taken out of the market. That’s more than for the whole year of 2014 and we are only three months in.”

    “And if you look at the order book for 2017 it’s empty. No one will order ships in the market we have now,” Billung told the newswire.

    “I think we will see the market improving somewhat when we move further in to the second quarter”, he added.

    It is speculated that Frontline 2012 will be merged with Frontline to also pull Fredriksen’s quoted tanker fleets under one umbrella.

    FINANCE
    ANDY PIERCE IN LONDON 23 March 2015, 16:09 GMT

  • play_tow play_tow Mar 24, 2015 3:59 PM Flag

    You might follow some of your own advise....wow indeed!

    The negative side effects from long term use of aspirin is well known, and there is not a current aspirin mediciation that does not have GI issues.

    It is precisely to overcome the dangers of taking aspirin that PA was developed. This addresses an UNMET medical need.

    When taken regularly over years, even very small amounts of aspirin can lead to the formation of stomach and intestinal ulcers. Aspirin is the oldest of what are known as “non-steroidal anti-inflammatory drugs.” It works by helping to thin and improve blood flow. But that is double-edged sword. The heart benefits are outweighed by increased risks of stomach and brain bleeding.

    You speak of alternatives. BS. There are none. Tylenol contains acetaminophen, which is toxic to the liver.
    Ibuprofen is an NSAID (non-steroid anti-inflammatory drug). Advil and Motrin are common OTC ibuprofen drugs , but these create side effects such as nausea and dizziness, hypertension, DNA damage, hearing loss, and miscarriage. The bottom line is that none of these OTC options are meant for long term use, for which aspirin regimes were intended fro heart benefits, among other benefits emerging.

    Some speak of homeopathic options, but there is no FDA evidence for their efficacy. Whether its Kratom, or Devils Claw. Some might take Cannabis, but noone which goal is to pursue a long term regime to gain the heart benefits of aspirin, or recovery from stroke, remotely entertains these approaches.

    Do your homework. Oh, and if you do have divine wisdom---as you suggest--- on the alternative that brings all the benefits of aspirin while removing its adverse impacts, then please market it, commercialize it, and go public.....it buy your stock and consume your meds!

  • play_tow play_tow Mar 24, 2015 1:38 PM Flag

    JL writes: " but be realistic, there are tons of safer aspirin products"

    The whole point of Yousprala is that THERE ARENT SAFER ASPIRIN PRODUCTS!!

  • Shares have steadily climbed since the earnings release, suggesting renewed confidence in
    the Yousprala approval.....

  • Their 20-F filing indicates 3 of the acquired Samco VLCC will remain on long term charters thru 2015.

    The Samco China is locked till Q22021. Sacco Redwood chartered till Q12016, and the Samco Taiga is on charter till Q42015.

    Two others come off charter in Q2, I believe.

    Two currently trade spot.

    4 other DHT VLCC trade spot, and a fifth (DHT Ann) is linked to Market rates

    1 Suezmax (Trader) is spot.

    1 Suezmax (Target( on charter till Q1 2016

    Both Afra on charters till Q1 2017.

    Unclear if any of these have profit share.

  • Reply to

    Futures contracts

    by veenk Mar 19, 2015 2:07 AM
    play_tow play_tow Mar 20, 2015 12:09 AM Flag

    Contango issue driven by Brent, not WTI spread. The former spread is much less currently.

  • Really, FRONTLINE 2012 is the looser in this, with the transaction being in shares owned, not a cash transaction. Given that Cape new builds cost about $55M, the 12 capes have a cost of about $600M. But VLCCF shares were trading at about $15 at the time of the agreement.

    ___________
    Knightsbridge Shipping Limited ("Knightsbridge" or "the Company") (VLCCF) is pleased to announce that the second and final stage of its previously announced vessel acquisition transaction with Frontline 2012 Ltd. has closed. Knightsbridge has issued 31 million shares to Frontline 2012 Ltd. in exchange for 12 Cape size bulk carrier newbuildings.

  • play_tow play_tow Mar 13, 2015 1:11 PM Flag

    The refiners must be printing money with the large spread of WTI to Brent.

    That spread should only grow over the next few months, and make for strong tailwind to the refiners.

  • Reply to

    Paragon releases 10 K...

    by insider_expert Mar 13, 2015 8:22 AM
    play_tow play_tow Mar 13, 2015 10:50 AM Flag

    Take a real look, and not a "strong buy" look.

    Their vessel values are plummeting, risking loan-to-value.

    Those vessels are not finding, and will no secure, contracts.

    The have moderate exposure to PBR, but the real issue is that there will be few tenders.

    The Prospector deal was ill timed, as Arctic drilling is among the most expensive propositions whose economics only make sense for oil trading above $90/bl.

    In the meantime, between stacked rigs, devalued equipment, and debt maintenance costs, the company has few options

  • Reply to

    Is PBR going BK?

    by dudethattrades Mar 13, 2015 9:35 AM
    play_tow play_tow Mar 13, 2015 10:45 AM Flag

    uglier than $1/sh??!!

  • play_tow play_tow Mar 13, 2015 10:23 AM Flag

    agree with a small edit:

    replace "IS" with "WAS"

    or if that offends, then ---

    replace "$23" with "$6"

    either edit works, tia

  • Reply to

    Suzemax Rates as of march 6

    by markbelfuss Mar 9, 2015 12:45 PM
    play_tow play_tow Mar 13, 2015 9:39 AM Flag

    a very few, but most have profit share

  • This is the case for the entire sector. 5 yrs ago, when oil was climbing and rig contracts were rising rapidly, and no one foresaw the coming US shale revolution, these UDW rigs were being ordered for $600-$700M per unit, placed on the credit card which had low interest and easy revolver. The assumption was that $500,000/day rates were a shoe in for ever. So, MLPs were formed, in which a spinoff unit payed $1B per drop down from the parent, using blend of equity and debt, allowing the parent to raise cash for yet more Newbuilds, and that was repeated. The MLP paid dearly, but with a fat 5-yr contract, and with unbounded optimism to be able and role over in a yet stronger charter market down the road, the math made sense.

    With cash break even being about $300,000s/ day, the ROI looked great, dividends could be generous, and grow with each new accretive DropDown.

    But the shale revolution has changed this cozy recipe . First, UDW is now seen as a high cost provider, and UDW oil is not economical in most sites for oil below $50/day. US shale is now, after 5 yrs of figuring how to scale production, economical even below oil at $50. And the proven reserve is immense. U S Shale is now the worlds swing producer, and can respond very fast to market conditions. It is therefore unlikely that oil will return to $100/ barrel. With a glut of UDW equipment , unwanted to boot, idle times soar and day rates plunge to perhaps cash break even. That means very low return on the $700M investment. To boot, rig valuations are at risk, and older equipment is almost worthless except as scrap.

    So, PGN with legacy equipment trades to $1/ SH today, after doing IPO at $15 just last August ( a different world ago)

    VTG, with modern equipment but heavy debt trades to 0.30/SH., down 90%.

    SDLP, which hit a new 52- wk low, will soon have to eliminate the only reason to invest in this MLP....it's dividend. It's share price will run into single digit territory.

  • Reply to

    VLCC Spot Up 5% Today

    by play_tow Mar 11, 2015 1:03 PM
    play_tow play_tow Mar 12, 2015 7:45 PM Flag

    NAT site carries links to Intertanko

  • play_tow play_tow Mar 12, 2015 1:24 PM Flag

    Your point is central to the dilemma faced by UDW sector, and investors in that space.

    Shale oil is now profitable at a much lower level than 2-4 yrs ago. And, the proven reserve of shale oil at economical market prices is much larger than assumed just a few yrs back.

    Shale therefore is becoming an abundant, and low cost provider. That puts a lid of the upper end of oil prices for the foreseeable futures, and also switches the dynamics of which players are most likely to have to strand some of their oil, until oil prices rise appreciably. It won't be shale, like many first thought.

    It will be tar sands, Arctic, and UDW, and therein lies the trouble for ORIG.

  • Reply to

    Missing the Point Here...

    by play_tow Mar 12, 2015 12:22 PM
    play_tow play_tow Mar 12, 2015 12:48 PM Flag

    Indeed...PGN as something like 15-20% contract exposure to Petrobras, which is not where you want to be for a partner at this time.

LNCO
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