BUMI ARMADA BERHAD

KLSE (MYR): ARMADA (5210)

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Last Price

0.585

Today's Change

+0.005 (0.86%)

Day's Change

0.575 - 0.585

Trading Volume

21,283,800


46 people like this.

71,168 comment(s). Last comment by Robert Waters 37 minutes ago

Posted by ageetkumar > 2 months ago | Report Abuse

Does anybody know what % of the DCR is the standby rate for Sterling V. How much does this translate to EPS?

Posted by Justaboylearning > 2 months ago | Report Abuse

Gooood bye , good luck all!

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

@Agreetkumar I suggest to exclude standby DCR as the issue seems to be with the FPSO, so they won't be getting any standby DCR while the delay persists.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

@i3lurker there is always a possibility the FPSO will never be functional. I hope Bumi Armada doesn't take part in a project with minority stake in the future. Too much as risk when they need to depend on the expertise of others.

rohank71

732 posts

Posted by rohank71 > 2 months ago | Report Abuse

Hi Niki, from what I understand, the USD980M loan was taken by ASV and has no recourse to BA. BAs loss is just the equity of USD30M. They can easily sell the equity to their partner and walk away. Also the contribution to BA from ASV is too small as the DCR less Opex will b used for repaying ASVs 980M loan for the first 7 to 9 years.

lloydlim

3,905 posts

Posted by lloydlim > 2 months ago | Report Abuse

Time to accumulate!

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

@Rohank regardless, the extended delay is a net negative to Bumi Armada. This new project should be contributing around RM120m in net profits per year for the 30% stake, equivalent to 2 sen per share. This was supposed to be a growth catalyst, albeit a small one, to a record-breaking profit year next year.

If the issue with Armada Sterling V is terminal, then yes Bumi Armada's direct losses may be limited to the US$30mil (which itself is some RM140mil, not an altogether small sum), but it will impact the future profits and the company's reputation adversely.

zonefinder

216 posts

Posted by zonefinder > 2 months ago | Report Abuse

Look at this positively especially for long term investors/sufferers...chance to accumulate more at good price..

Ninja _07

444 posts

Posted by Ninja _07 > 2 months ago | Report Abuse

Rebound

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

Woah what a shit show. It is highly likely the issue is related to the FPSO to some degree. As they were all ready to receive first oil last month and there was equipment failure on the FPSO.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

A pump of some sort had failed abroad the FPSO.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

This means that the FPSO would be idle from Dec 2022 to May 2024. How would this impact the production systems? Would they corrode or degrade after such a lengthy time of not being used?

I say, be prepared to write-off Armada Sterling V FPSO.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

Such a lengthy delay out of the blue must mean that there are teething or even terminal problems.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

Yes it won't be scrapped but it might be delayed indefinitely. Just like what's been happening now. Initially due to start Sep 2021 but delayed to May 2022 due to Covid. That is understandable. But then it kept getting pushed back. To Dec 22, then Apr 23, then May 23, then Aug 23, then Oct 23, then Nov 23, then Dec 23 and now May 24.

ckwee168

25 posts

Posted by ckwee168 > 2 months ago | Report Abuse

i remembered our very own flagship Gemusut Kakap deepwater semi-floating production system also suffered significant delays, cost overruns and arbitrations before reaching its commercial production .. as long as the field is not depleted, i'm still optimistic that production will come thru at some point ..

vespa

785 posts

Posted by vespa > 2 months ago | Report Abuse

plagued with problems

vespa

785 posts

Posted by vespa > 2 months ago | Report Abuse

Armada scrapes the barrel for partners

vespa

785 posts

Posted by vespa > 2 months ago | Report Abuse

Another major off project factor perhaps to prime execution maybe handouts just as in bolehland

Penarak

69 posts

Posted by Penarak > 2 months ago | Report Abuse

For the State Oil Company to inform the Indian Parliment that commercial production commences in May 2024, they are confident to produce. Big procedure between First Oil and Commercial Production.So looks ok.And Sharpoorji Pallonji are big boys who should know what they are doing.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

Actually as what Niki said its a reputation issue to BA and not so much financial even though BAs investment is abt USD30M.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

#rohank too had a point. This is an associate co, the debt of ASV amounting USD980M is not in the books of BA. Whats not answered, "is BA booking the interest expense of its 30% ASV in its accounts now or is it capitalised". The interest exp can amount to USD70M per annum and BAs portion is USD21M. Chances are its being capitalised at ASV. There is actually no cash flow value to BA as the USD230M/annual charter rate, normally 60% is free cash flow b4 financing or abt 140M. 70M goes towards interest service and 70M goes to reduce loan. So for next 9 years ASV will NOT contribute to BA any cashflow. In PBT terms 30% of PBT of ASV less depreciation, which will be peanuts.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

I dont know why we harp abt the 30% associate when its not worth much in to BA in financial terms. BA can chose to sell their 30% to their partner and move on too. Its is their partner and ONGCC who should be most worried. Its only a reputation risk to BA. Wouldnt be surprised once ASV starts operation BA may sell their 30% to their partner at cost plus holding cost and walk away. Still a good deal to BA being involved ans succesfully completing the largest fpso in India.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

BA should concentrate on its 100% owned FPSOs and deliver the numbers and hope for the extension. Once a FPSO goes on the extension the cashflow is free and no more loan repayment for that FPSO. We should cheer when BA gets extensions. BA has enough on its plate and should just concentrate on reducing its debts and securing extension. The Akai development is timed rightly in 2026 coz by then BAs gearing will be low and would have secured some extensions of fpso's to embark on a BIG project. We also do not want an early project which will require a cashcall.

vespa

785 posts

Posted by vespa > 2 months ago | Report Abuse

Above all true but competence comes into question and market aint impressed as it has one of the highest net short selling position

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

EVEBITDA you are wrong on one count. Not sure where you get the idea that Armada Sterling V will not be contributing any cashflows to Bumi Armada during the initial 9 year firm charter period. The cashflows will come from the dividend or redemption of preference shares (the method used for Armada Sterling 1/2/3).

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

Niki, see Armadas announcement dated 12 Sept 2023. Loan taken by ASV is 948M. Do ur math if free cash flow/ EBITDA is say 140M. How many years to tepay this loan, say at interest rate of 7%. Bankers takes the money first, whats left is for shareholders. Aramada didnt say they subscribed to any pref shares, if they did they would only receive payments after all financial covenants of the lenders are met. There is not much cash left after loan repayment. The firm contract is for 9 years. Bamkers want out before firm contract expires.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

We have not even gone into DSCR ect. Probably this loan is also guaranteed by ONGCC as offtaker. Whats important is to find out if BA has invested more than equity of USD30M. And if BA is currently servicing the 948M loan. Normally NO for project loan until project kick off. BA announcements also doesnt indicate it has guaranteed this loan. As you correctly said its a reputation issue for BA.

nikicheong

2,250 posts

Posted by nikicheong > 2 months ago | Report Abuse

Interestingly, according to my sources, the first oil date remains as January 2024. They've identified the issue and are working to resolve it. Let's wait and see.

rohank71

732 posts

Posted by rohank71 > 2 months ago | Report Abuse

Tq EVEBITDA for your thoughts. Thanks for sharing. Can I summarise that ASV has minimal impact on BA on financial other than reputation issues?

RayLee

133 posts

Posted by RayLee > 2 months ago | Report Abuse

It has maintained a “buy” call on the group with a target price of 71 sen per share from HLIBB

Posted by Justaboylearning > 2 months ago | Report Abuse

Raylee

Armada Sterling V is expected to see first oil next week though the acceptance test certificate is still ongoing with each test requiring 3-4 days.On its financing, the FPSO has successfully achieved financial close and has fully drawn down USD948m project financing facility to repay its USD930m bridging loan facility.


Means sell since no oil to be seen

rohank71

732 posts

Posted by rohank71 > 2 months ago | Report Abuse

Technically, BA looks really bad as it hit 50 sen today. Anyone can advise where the next technical support is.. or still maintain 50.5 sen as a good support base. Some tell me support 48 sen and resistance at 54 sen. 50.5 sen is the base now.

EVEBITDA

145 posts

Posted by EVEBITDA > 2 months ago | Report Abuse

Looking at BAs interest cost in Q3 2023 of RM107M on debts of 4.5B, looks like BAs average cost of debt is abt 10% pa. This is based on companys analyst brief deck on their website. With Brent droping lower it adds to the problem. CGS has put a fair value of 40 sen if there is no extension of firm contract and 84 sen if 100% of extension is achieved with a discount rate/ factor of 13%. With borrowing cost at 10% a fair Discount factor should be 15 to 18%. Basically would u want to lend BA @ 10% or be a shareholder at 13%. I dont mind being a shareholder at 15 to 18% returns. We may see a correction but I am fairly bullish for it to hit 70 sen in 24 months provided karken, ASV1, ASV2, and Olombendo performs (these are the main drivers, rest is not important). TGT1, extension willmadd to the valuation. Enjoy the journey with BA and to share I will buy more if BA drops. I love free cash flows and not profits but mgmt MUST deliver.

In 24 mths if BA can deliver and with Akai comming on stream, we may see 1.00, provided Brent stays at 80 but if BA fails, its UGLY. Again, lets "enjoy" the ride and journey with BA. High risk, high rewards. Buy within ur means or sell if you are over exposed.

RISK8888

2,226 posts

Posted by RISK8888 > 2 months ago | Report Abuse

wow, profitable QR but price fall like no support at all??? what is going on??? kraken failure 2.0???

Posted by Gabriel Khoo > 2 months ago | Report Abuse

Here state oil production will state this month posted 2 days ago only why so many noise here

Posted by StartOfTheBull > 2 months ago | Report Abuse

I guess Lee is a wise man, he knows all friends, even a very close friend cannot always be trusted. Very unlikely Lee has bought Armada at 515 (0.515.)


Mikecyc

41,458 posts

Posted by Mikecyc > 9 minutes ago | Report Abuse

Haha recalled u said 5.15 to sslleee ..

Then sslleee asked U , yr really:

1/12/2023 RM 0.515


Posted by i3lurker > 1 minute ago | Report Abuse
Armada 
not cheap but ok lah

Mikecyc

43,058 posts

Posted by Mikecyc > 2 months ago |

Post removed.Why?

Posted by ITreeinvestor > 2 months ago | Report Abuse

#ONGC is eyeing commencement of #Oil production from its flagship deepwater project KG-98/2 Development Project in December 2023.

Gas production from Project has already commenced in March 2020 with plan of further ramping up by May 2024.

https://www.linkedin.com/posts/oilandnaturalgascorporation_ongc-oil-ongcjeetegatohjeetegaindia-activity-7137463703498596352-aHSb

Posted by ITreeinvestor > 2 months ago | Report Abuse

Latest update from ONGC, oil production will be commence in Dec 2023.

Posted by StartOfTheBull > 2 months ago | Report Abuse

You must understand, this is another good part of i3 forum. If any present comment contradict a past comment, you can quickly delete a past comment as fast as you can to avoid being rediculed after that.

Mikecyc

41,460 posts

Posted by Mikecyc > 24 minutes ago | Report Abuse

Haha Lirker u own deleted own posts so fast ke ….

KimSua

385 posts

Posted by KimSua > 2 months ago | Report Abuse

Can top up. Heavily shorted should stabilise this week

GoldenShares

3,537 posts

Posted by GoldenShares > 2 months ago | Report Abuse

wow below 0.50

TimCoke

117 posts

Posted by TimCoke > 2 months ago | Report Abuse

495 seems like a good buy today

Sslee

4,091 posts

Posted by Sslee > 2 months ago | Report Abuse

I am back to grab some for my free bintang beer and lobster. Thank you very much to my favorite trading stock Armada.

Posted by StartOfTheBull > 2 months ago | Report Abuse

Bought at 515. Wish you good luck.


Sslee

3,274 posts

Posted by Sslee > 7 minutes ago | Report Abuse

I am back to grab some for my free bintang beer and lobster. Thank you very much to my favorite trading stock Armada.


i3lurker

13,056 posts

Posted by i3lurker > 18 minutes ago | Report Abuse

Haha

no worries
sslee already made many hundred thousands RM based on my Armada buy calls in prior years.

now temporary lose a little bit just to trap Satanic Accuser MikeCheatYouCrazy is totally worth it. 🤣 👍

StingRay

6,729 posts

Posted by StingRay > 2 months ago | Report Abuse

Still not time to touch O&G counter lah. I very much earlier already warned Ular not to even peek at O&G counter last couple of months loh. 🤣

Ninja _07

444 posts

Posted by Ninja _07 > 2 months ago | Report Abuse

Thank you @Gabriel Khoo for the information

Ninja _07

444 posts

Posted by Ninja _07 > 2 months ago | Report Abuse

I am very sure that i3lurker lost his money in this counter 😂😂😂

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