Marco Polo Marine (5LY)

Draft: 1/25/2017
Update: 1/25/2017

Some initial impression after reading the initial portion of Marco Polo Marine(AR2016): - financial year ends on Sep 30th.

It pays director fee (of 4) at $180,000 per annum even during downturn. The company made a loss of 16m in 2016.

It is about 47c per share NAV, but is sold on market (1/25/2017) at 4.5c, with a market value S$15m. (date: 1/25/2017)

It consists of shipyard repair/maintenance division and ship charting business. Based on AR:

- Total Asset 449m (Non-current: 319m/Current: 130m)

- Total Liabilities 290m (Non-current: 134m/Current: 156m (of which 116m is the loan/interest bearing))

- NA: 159m

Exec chairman and CEO are of father-son relationship. Remuneration pkg in 2016 >250k <500k each.

Mr. Lee Wan Tang (chairman) owns deemed interest of 200m+ shares in the company. 61% of company.

 

Underwent a nego on Loan restructuring exercise with local banks (DBS?) $50m bond(from that of 116m under current liability?), at 5.75% coupon rate, extended till 2018 with condition: +1.5% extra interest; mortgage with a piece of land in Batam.

Auditor (MAZARS LLP) emphasis:
Note 2.1, net current liabilities of 26m, uncertainty to continue as a going concern. Indicating that if the group is unable to continue its normal course of business, assets may need to be realized at significantly different amount; and reclassify non-current asset/liabilities as current asset/liabilities.
"Our opinion is not qualified in respect of this matter"

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My assessment(stopped at pg43):

Until it trims director fee, it is not on the same boat as shareholders', or wait unless it is below Xc?

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Owner's own words:

Sean: Typically for tug and barge operations, we are talking about 70% to 80% financing today, depending on the age of the vessels.

These banks prefer to lend in USD. (FX risks?)

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An old analyst article in 2015

Maintain BUY, with a SGD0.60 TP. Being profitable and cash-flow positive, we think that valuations have troughed at 0.5x P/BV. Our SGD0.60 TP is pegged to 1.2x BV.

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Tabloid

Mr. Sean Lee (CEO) wedded Vivian Hsu, TW actress, in 2014.

中国有句古话：“情场得意，商场失意”。