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Cutting or holding Marco Polo Marine?

Friday, July 29, 2016

Dear AK

Good day to you!

MPM has been on serious "diarrhoea" mode for a long time.  Friends have advised that I should cut-loss and forget about this counter.

I would appreciate it if you could talk to yourself on MPM.

Thank you.


AK says:
"MPM has survived previous down cycles before. I am hopeful that they will survive this time too.

"The elder Lee now holds 62% of MPM's stocks. He wouldn't want MPM to go under.

"I am holding on to my investment, understanding that, for a while now and for a while more, this position is rather speculative."

Related post:
Marco Polo Marine: Termination of rig contract.


AK71 said...

"Not sure whether to cut loss.
Cut loss is pain as already lost too much.
Well but also worried it may goes bankrupt , after Swiber news , I am worried too."

"They are in the same sector but they are 2 different companies.
MPM has a lower gearing level and higher interest cover ratio when compared to Swiber."

yeh said...

Marco polo is having huge losses this quarter.
How do you view this situation?

are you going to cut loss?

AK71 said...

Hi yeh,

I am prepared to write it off if things get much worse. Not selling.

This has been a speculative position for some time now and it is not something I am going to lose sleep over.

AK71 said...

Marco Polo said that, even though the global oil price may have recently stabilized, the offshore marine industry continues to remain in a sustained depression, affecting all the companies in this sector. Most of the group’s vessels are not chartered out, with a good number of the customers of the group not paying on time or at all, leading to an accumulation of substantial aged accounts receivables which, in turn, affected the group’s working capital.

In view of the challenging market environment, the company expects to report a net loss in the second quarter of the financial year ending September 30, 2017.

Marco Polo Marine’s ability to continue as a going concern was brought into question at the end of last year by the company’s independent auditors, Mazars LLP.

Namely, as at September 30, 2016, the group reported a net current liabilities position of S$25.98 million. The group also incurred loss before tax of $16.94 million.

This indicated the existence of a material uncertainty which may cast significant doubt on the ability of the group to continue as a going concern, the auditor said.

It also said that the ability of the group to continue as a going concern was dependent on the successful negotiation and completion of the restructuring of its bank loans or the generation of sufficient cash flows.


focustime said...

Hi Ak,

Marco Polo is turning around, good news, can buy more ?

AK71 said...

Hi focustime,

I am less speculative in my old age. ;)

You decide. :)

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