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GM folks! What happened to GE? Not globalization, I suppose, isn't it as much globalized company as possible?
Will euro/dollar hit 1.60 today?
APIO.ob 0.098 Good 3Q results!
API Nanotronics Announces Third Quarter and Nine Month Results
Friday April 11, 8:00 am ET
Revenue Increased 60% in the Quarter and 75% in the First Nine Months While Record Backlog Increased to Over $17.5 Million
NEW YORK, NY--(MARKET WIRE)--Apr 11, 2008 -- API Nanotronics Corp. (OTC BB:APIO.OB - News) ("API") (the "Company"), a leading supplier of electronic components and nanotechnology research and development to the defense and communications sectors, today announced operating results for the three and nine month periods ended February 29, 2008.
Financial Highlights for the Three Months Ended February 29, 2008
-- Revenue for the third quarter of fiscal 2008 was $7.4 million, a 60%
increase over the $4.6 million reached in the same quarter of fiscal 2007.
Revenue in 2008 included a full quarter contribution from the National
Hybrid Group, acquired by API on January 24, 2007;
-- Gross profit increased to $1.9 million in the third quarter of fiscal
2008, a 72% increase over fiscal 2007 third quarter gross profit of $1.1
million;
-- Gross margins improved to 26% in the third quarter of 2008, compared
to 24% in the same quarter of the previous year;
-- Net loss for the quarter was $1.1 million or $0.00 per share, compared
to a loss of $0.2 million or $0.00 in third quarter of 2007 (excluding
expenses related to nanotechnology R&D, net loss for third quarter of 2008
would have been $25,000(1));
-- Balance sheet with over $2.0 million in cash and marketable
securities; and
-- A strong order flow contributed to a record backlog of over $17.5
million.
Financial Highlights for the Nine Months Ended February 29, 2008
-- Revenue increased 75% from $12.7 million for the first nine months of
fiscal 2007 to $22.1 million for the first nine months of fiscal 2008;
-- Gross profit increased to $5.9 million in the first nine months of
fiscal 2008, an increase of over 96% from the $3.0 million gross profit in
the same period of fiscal 2007;
-- Gross margins improved 3% to 27% in the first nine months of fiscal
2008 from the previous year's 24%; and
-- Net loss of $3.0 million or $0.01 per share for the first nine months
of fiscal 2008, compared to net loss of $0.8 million or $0.00 per share for
the same period of fiscal 2007 (excluding expenses related to
nanotechnology R&D, net loss for the first nine months of 2008 would have
been $0.6 million(1)).
Operating Highlights
During third quarter of fiscal 2008, API experienced strong demand for its products and made several strategic advancements that position the Company for further growth in future periods.
-- In the third quarter the Company received a record level of orders
totaling over $9.0 million, including a record monthly total of $3.9
million in February;
-- In February, API's National Hybrid division introduced its new line of
Aries 1553 communication devices in partnership with Israeli company Sital
Technologies. The product, a direct replacement for a competitor's
product, represents a significant market opportunity and received a strong
initial reception;
-- In February 2008, the Company's TM Systems received a follow-on order
for its specialized landing navigation systems from a longtime customer and
leading defense contractor worth more than $1.4 million; and
-- The Company's NanoOpto division has responded to requests from leading
technology companies for proprietary nano-optic solutions in the areas of
next generation storage, communications, display and alternative energy.
The Company has delivered no less than 12 samples with potential to yield
significant orders and leadership in new markets.
ADVERTISEMENT
Phillip DeZwirek, Chairman and Chief Executive Officer of API Nanotronics Corp., said, "API is delivering growth through both acquisition and product innovation and development. The initial response to the introduction of Aries has been impressive and we are structuring sales efforts to capitalize on this opportunity. We are also extremely encouraged by the level of interest in API's nanotechnology capabilities. We expect our efforts to develop proprietary nanotechnology derived solutions for an impressive roster of global technology leaders to yield significant orders ahead of many of our nanotechnology peers."
About API Nanotronics Corp.
API Nanotronics Corp., through its wholly owned subsidiaries API Electronics Inc., National Hybrid Inc., Filtran Group, TM Systems II, Inc. Keytronics Inc. and API Nanofabrication and Research Corporation, is engaged in the manufacture of electronic components and systems for the defense and communications industries. API is also developing a leadership position in the R&D and manufacture of nanotechnology and MEMS products. With a growing list of blue chip customers, including Honeywell/Allied Signal, General Dynamics, Lockheed Martin, and numerous other top technology-based firms around the world, API regularly ships products to clients in more than 34 countries. API owns state-of-the-art manufacturing and technology centers in New York, New Jersey, Florida and Ontario, Canada and has manufacturing capabilities in China and a distribution center in Britain. API Nanotronics trades on the OTC Bulletin Board under the symbol APIO. For further information, please visit the Company's website at www.apinanotronics.com
(1): API presents this non-GAAP information as a supplemental figure because management believes it provides useful information regarding operating performance without the impact of its research and development efforts related to nanotechnology. This is not a recognized measure under US GAAP, does not have a standardized meaning, and is unlikely to be comparable to similar measures used by other companies. Accordingly, investors are cautioned that this non-GAAP measure should not be construed as an alternative to net earnings or loss determined in accordance with GAAP as an indicator of the financial performance of the Company or as a measure of the Company's liquidity and cash flows.
Safe Harbor for Forward-Looking Statements:
Except for statements of historical fact, the information presented herein constitutes forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to acquire and develop specific projects, the ability to fund operations and changes in consumer and business consumption habits and other factors over which API Nanotronics Corp. and its subsidiaries and affiliates have little or no control.
Contact:
CONTACT:
Steve Bulwa
Director of Corporate Communications
API Nanotronics
1-877-API-O-API (274-0274)
Email Contact
GM Stuffit. Heh - what else can Landau say - if asked. I hope he is right this time.
BQI $4.20 A good article about BQI and its chances. A loooong term investment, but worth keeping an eye on it:
Oilsands' Quest to Become a Major Canadian Producer
by: SmallCapInvestor.com posted on: February 27, 2008 | about stocks: BQI
For all the chatter surrounding wind, solar, biomass and other “green” energy sources, the world still runs on old-fashioned fossil fuel — and will to an even greater degree into the distant future. The U.S. Energy Information Administration presages daily world petroleum consumption will grow to 97 million barrels in 2015 to 118 million barrels in 2030, from 83 million barrels today.
Growing demand for petroleum and its distillates is as old as the industry itself. In recent years, the demand has quickened a step or two; hence, the five-fold increase in per-barrel prices over the past decade.
No one likes to pay higher prices, but higher prices spur entrepreneurs to bring new oil supplies to market. One notable entrepreneur actively seeking new supplies is Oilsands Quest Inc. (AMEX: BQI), a Calgary-based energy exploration and development company whose business is extracting oil from oil sands.
And there's potentially a lot of oil for Oilsands to extract. Canada's oil sand reserves lie under an expanse of real estate larger than Florida, putting it on par with Saudi Arabia's reserves. But unlike the Saudi's reserves, which flow relatively freely, Canada's oil from sand often requires high-pressure steam — produced by burning vast amounts of natural gas — that's injected into the ground to separate the viscous bitumen from the sand to which it adheres.
Oil at $30 a barrel provides little incentive to pressure-wash sand for oil. Oil at $100 a barrel is another matter. Today's prices have inspired oil sands projects valued at $100 billion, further cementing Canada's position as the number one crude-oil supplier to the United States.
Oilsands is working to assure that the United States's petroleum thirst remains well slaked. The company owns a 100% interest in the Saskatchewan Oil Shale exploration, as well as lesser projects in the Alberta oil sands, giving it the largest contiguous lease on oil sands in Canada, if not the world. The company has forged ahead with an ambitious winter drilling program to prove reserves ahead of a 10,000-barrel-per-day pilot project scheduled to start up in 2009, with a subsequent target of 100,000 barrels per day. The company has four rigs turning in Alberta and Saskatchewan to delineate an estimated 1.5 billion barrels of contingent reserves.
But in today's incarnation, Oilsands is more exploration than development, which means it is expending, not generating, cash flow. At this juncture its income statement is relatively useless for extrapolative purposes, but here are the numbers anyway: in the six-month period ended Oct. 31, 2007, revenue was nil, resulting in a net loss of $26.6 million. In the same six-month period in 2006, revenue was also nil, but the net loss was larger — $35.6 million. Looking at 2008, revenue will be equally barren and losses equally pronounced.
At this stage the balance sheet is more revealing than the income statement. As of Oct. 31, 2007, Oilsands was sitting on $49.6 million in cash and no long-term debt, compared with $32.4 million in cash and no long-term debt at the end of Oct. 31, 2006, which means the company is sufficiently capitalized to fund its working capital and exploration and production needs.
Oilsands's value lies in its potential. The Alberta Energy Utilities Board estimates that oil extracted from oil sands is expected to grow to 4.6 million barrels a day in 2015 and then to 4.9 million barrels a day by 2020. Saskatchewan is Canada’s second largest oil producer (after Alberta) and produces about 17% of Canada’s total oil production. No one knows for sure how big Saskatchewan's oil sands are, but early estimates put reserves at one-fifth of the 300-billion barrels of known bitumen reserves.
In short, Oilsands's potential is tall, and the analysts who follow the company generally concur. Desjardins Securities analyst Adam Zive recently reiterated his $7.50 per share price target based on the company's oil discovery at its Axe Lake property in Saskatchewan. Blackmont Capital analyst Menno Hulshof has a target price of $7.25 per share, noting "Oilsands Quest has the single largest, contiguous oil sands acreage position in the industry, and its shares continue to trade at a sharp discount to net asset value, making it the least expensive company in its peer group.”
TD Newcrest analyst Mark Friesen is more circumspect. He recently initiated coverage with a “speculative buy” and a 12-month price target of $5.75 per share. Friesen states that “while this success cannot be extrapolated over the remaining unexplored land position, it seems reasonable that much more remains to be discovered on the company’s leases.”
Here's our distillation of Oilsands's value: the company has 241 million shares issued and outstanding, which gives a book value of $2.06 share. The closing price on Monday was $3.88. All the known potential — the Axe Lake reserves in Saskatchewan and projected annual production — is priced into the shares, with a discount for the probability of various failure scenarios.
That said, one can convincingly argue that insufficient premium is given to the difficulties — thanks largely to the environmentalists — of replacing reserves, which gives the drilling rights alone the potential to drive share-price higher. What's more, the probability of share appreciation increases as stated goals are met and as oil prices move higher. Should both events continue along recent trends, Oilsands' (BQI) shareholders will get closer to their quest for a higher share price.
Yare velkam :)
One of my numerous English teachers was Thames Television/Benny Hill!: "Goodbody every evening"
Sometimes methinks I've learned much of my English from them :)
Yep Stuffit. There's no such thing as a vacation for an active trader :). Read the Shipbuilding-section of the Barry Rogliano report (and the rest after the vacation).
When you have time take a look also on McQuilling pages. There are more good and more accurate information - in 1-2 pages reports! - about the shipping world.
http://www.mcqservices.com/compan.asp?ID=101
Xanadu (not trying to stress you!)
Enjoy your vacation!
Hello Kujo. Do you know is Mærsk a shareholder of TUI/Hapag Lloyd? Are they also fighting of acquiring HL? John Fredriksen Empire is trying to get Hapag Lloyds' containers.
Not much new information about ITCL. They do not even have own webpages, because ITCL is still totally managed by Frontline. Frontline's policy is to keep managements and administration as small as possible. GOGL is driven by 3 people staff!
ITCL closed at NOK 8.75 = USD 1.73, have been drifting down since listing (as usual) at NOK 11.00. Good for you - you get your shares cheaper.
Have you seen this:
ITCL (Independent Tankers Corporation Limited)
06/03-2008 16:40:35: (ITCL.OTC) ITCL:
Independent Tankers Corporation Limited is registered on the NOTC-list
Independent Tankers Corporation Limited is registered on the NOTC-list as from the 7th of March 2008.
Ticker: ITCL. ISIN: BMG4758V1000.
The company has issued 74 825 169 shares. Par value per share is USD 0.3.
The company has entered into an agreement whereby it will be able to use the reporting system as from the 7th of March 2008.
ITC owns all the issued and outstanding shares of the three ship-owning companies; California Petroleum Transport Corporation, Golden State Petroleum Transport Corporation, and Windsor Petroleum Transport Corporation. ITC’s business is concentrated around the ownership of tankers on long term bareboat contracts to major oil companies, including certain cancellation options. All vessels are financed through bonds and some of the vessels are also subject to lease arrangements. ITC purchases all necessary management services from Frontline.
The basics from Frontline's website:
http://hugin.info/182/R/1196965/243487.pdf
Shippingfans Ahoy!
Link to Barry Rogliano Salles' (BRS) Annual Report "Shipping and Shipbuilding Markets 2007" on Tanker board. Take a look:
http://investorshub.advfn.com/boards/read_msg.asp?message_id=28229899
Barry Rogliano Salles' (a French old legendary shipbroker) Annual Report "Shipping and Shipbuilding Markets 2007" has been published on their website. Long experience and usefull information for shipping fans.
Here's the link - need to register (it's free) but it's worth it. They publish all year weekly reports from all shipping sectors:
http://www.brs-paris.com
Weekend reading, shipping fans (108 pages)!
Have a nice vacation Stuffit. You've surely earned it :)
Hello Stuffit. Wau, that USU could have taken us to the promised land! Is it an uranium company?
Lol.. Sure... just jump deep down in the ocean! Promised land is nowadays down at the seabed (ask Exxon). Subsea things and ROCs are most wanted in the near future :)
BTW, seismic surveys could also take you to the promised land -maybe even faster! Take a look e.g at BOLT $19.00. There are others - DWSN, CGV - but those are already much higher priced.
DPDW climbing, now 0.82. Drilling services are needed.
GM Wildbill. We are not alone. Someone else seem to like offshore drilling too... Noble gets a 29-years contract!
GM StockLobster. Do you read the Tanker board? Here's news (well, not really news, but interesting) about DRYS. No smoke without fire. Read the bold text:
DryShips and the Oil Rush
posted on: April 02, 2008 | about stocks: DRYS
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Yesterday's front page of the Wall Street Journal highlighted John Fredriksen, Norway's richest man, for his brilliance at entering deep water drilling. His company Seadrill Ltd three years ago ordered two "ultradeep water" rigs able to drill at a 7500 feet depth. Now Seadrill Ltd has four of these deep water drill ships. Only 39 currently exist in the world.
That gives Mr. Fredriksen enormous pricing power. His units are in such demand he can charge major oil companies nearly $600,000 a day to use them. Similar rigs were earning about $70,000 a day just five years ago. With leasing rates like these, a vessel that cost half a billion dollars to build can pay for itself in as little as four years.
The article makes me think about another visionary, George Economou, CEO of DryShips (DRYS). His company has, up until recently, been solely involved in chartering dry bulk ships. Dry bulk leases have been extremely profitable (for instance, spot charters go for $134,000 a day for Cape ships at a cost of $ 6 - 7000 a day.)
Economou has entered deep water drilling and these drill ships bring an extraordinary upside for the company. Dryships has bought 30% of Ocean Rig, a company that owns 2 deep water drill ships and has an option to buy 2 drill ships. It is likely that Dryships will ultimately buy all of Ocean Rig and continue its venture into deep water drilling. This should give Dryships yet another highly profitable marine asset to lease, one which should pay off handsomely.
Disclosure: Author has a long position in DRYS
DRYS $59.98 DryShips and the Oil Rush
posted on: April 02, 2008 | about stocks: DRYS
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Yesterday's front page of the Wall Street Journal highlighted John Fredriksen, Norway's richest man, for his brilliance at entering deep water drilling. His company Seadrill Ltd three years ago ordered two "ultradeep water" rigs able to drill at a 7500 feet depth. Now Seadrill Ltd has four of these deep water drill ships. Only 39 currently exist in the world.
That gives Mr. Fredriksen enormous pricing power. His units are in such demand he can charge major oil companies nearly $600,000 a day to use them. Similar rigs were earning about $70,000 a day just five years ago. With leasing rates like these, a vessel that cost half a billion dollars to build can pay for itself in as little as four years.
The article makes me think about another visionary, George Economou, CEO of DryShips (DRYS). His company has, up until recently, been solely involved in chartering dry bulk ships. Dry bulk leases have been extremely profitable (for instance, spot charters go for $134,000 a day for Cape ships at a cost of $ 6 - 7000 a day.)
Economou has entered deep water drilling and these drill ships bring an extraordinary upside for the company. Dryships has bought 30% of Ocean Rig, a company that owns 2 deep water drill ships and has an option to buy 2 drill ships. It is likely that Dryships will ultimately buy all of Ocean Rig and continue its venture into deep water drilling. This should give Dryships yet another highly profitable marine asset to lease, one which should pay off handsomely.
Disclosure: Author has a long position in DRYS
FREE $6.44 FreeSeas Inc. Announces Delivery of the Free Impala
Wednesday April 2, 8:00 am ET
Company Also Announces New Time Charter for the Free Envoy
PIRAEUS, Greece, April 2, 2008 (PRIME NEWSWIRE) -- FreeSeas Inc. (NasdaqGM:FREE - News) (NasdaqGM:FREEW - News) (NasdaqGM:FREEZ - News) (``FreeSeas'' or ``the Company''), a provider of seaborne transportation for drybulk cargoes, announced today that it has taken delivery of the 1997-built 24,111 dwt Handysize Free Impala. The Free Impala is being delivered to a one-year time charter at a rate of $31,500 per day, as previously announced.
ADVERTISEMENT
FreeSeas Inc. also announced today that the 1984-built, 26,318 dwt Handysize vessel Free Envoy has completed its one-year period charter at $17,000 per day and has been delivered to new charterers for a 15-day spot voyage at $31,500 per day.
``With seven vessels now in the fleet and one still to be delivered later this year, our fleet continues to increase its earnings capacity,'' stated Mr. Ion Varouxakis, Chairman, President and Chief Executive Officer of FreeSeas. ``The Free Impala is a modern vessel that we believe will be a significant revenue contributor for years to come. We are also extremely gratified to see that even our older vessels, like the Free Envoy, remain very healthy earners as well.''
The following table detail FreeSeas' current fleet as announced today:
Current fleet:
Vessel Name Dwt Vessel Type Built Employment
------------ ------ ----------- ----- -----------------------
Free Destiny 25,240 Handysize 1982 75-day time-charter at
$27,500 p/d
Free Envoy 26,318 Handysize 1984 15-day time-charter at
$31,500 p/d
Free Goddess 22,051 Handysize 1995 Two-year time-charter
through November 2009
at $19,250 p/d
Free Hero 24,318 Handysize 1995 Time-charter through
February 2009 at
$14,500 p/d
Free Impala 24,111 Handysize 1997 One-year time-charter
through April 2009 at
$31,500 p/d
Free Jupiter 47,777 Handymax 2002 Three-year time-charter
through February 2011
at $32,000/28,000/
24,000 p/d
Free Knight 24,111 Handysize 1998 One-year time-charter
through March 2009 at
$31,500 p/d
Vessel to be delivered:
Expected
Vessel Name Dwt Vessel Type Built Delivery Employment
----------- ------ ----------- ----- --------- ----------------
Free Lady 50,246 Handymax 2003 June-July No employment
2008 currently in
place
About FreeSeas Inc.
FreeSeas Inc. is a Marshall Islands corporation with principal offices in Piraeus, Greece. FreeSeas is engaged in the transportation of dry bulk cargoes through the ownership and operation of dry bulk carriers. Currently, it has a fleet of five Handysize vessels and one Handymax vessel. FreeSeas' common stock and warrants trade on the NASDAQ Global Market under the symbols FREE, FREEW and FREEZ, respectively. Risks and uncertainties are described in reports filed by FreeSeas Inc. with the US Securities and Exchange Commission, which can be obtained free of charge on the SEC's website at http://www.sec.gov. For more information about FreeSeas Inc., please go to our corporate website, http://www.freeseas.gr.
DRYS $59.98 DryShips Inc. Announces Quarterly Cash Dividend of $0.20 per Common Share
Wednesday April 2, 4:05 pm ET
ATHENS, GREECE--(MARKET WIRE)--Apr 2, 2008 -- DryShips Inc. (NasdaqGS:DRYS - News) announced today that its Board of Directors has declared a quarterly cash dividend of $0.20 per common share, payable April 30th, 2008, to stockholders of record as of April 17th, 2008.
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This is the twelfth consecutive quarterly cash dividend of $0.20 per share declared by the Company since its listing on the NASDAQ Global Market in February 2005.
About DryShips Inc.
DryShips Inc. is an international provider of drybulk carriers. Headquartered in Athens, Greece, DryShips currently owns and operates a fleet of 46 drybulk carriers comprising 5 Capesize, 31 Panamax, 2 Supramax and 8 newbuilding Panamax vessels, with a combined deadweight tonnage of over 4 million tons.
DryShips Inc.'s common stock is listed on NASDAQ Global Market where it trades under the symbol "DRYS."
Milner. FRO is really targeting to acquire OSG, but must see first that it happens. As far as I know OSG has not said no or yes, but JF and OSG's CEO Morten Arntzen were seen in a "friendly discussion" at a Marine Conference last week...
It may also be the old trick: look how the price of OSG has surged after the buying offer was published (don't buy it now!). If OSG says no, FRO sells the shares with good profit.
OSG is mainly a tanker (oil/oil products) shipper, so as to GOGL in this context, I have no idea. Of course it could be possible. Mr. Billung, CEO of GOGL has stated that listing GOGL to a higher US bourse is too expensive. I guess that's why DOCK and DESSC are also only listed on grey pinksheets.
DOCK NOK13.90 = USD2.70 new contracts!
Published: 16:15 02.04.2008 GMT+2 /HUGIN /Source:
Dockwise Ltd /OSE: DOCK /ISIN: BMG2786A1062
Dockwise is awarded four (4) contracts for transport of drilling and production equipment
Bermuda, April 2, 2008. Dockwise Ltd. announces that their subsidiary Dockwise Shipping was awarded four (4) contracts for the transportation of drilling and production equipment.
Dockwise Shipping will transport jack-up drilling rigs Transocean Nordic, Murmanskaya and Atwoord Aurora within 2008. The PetroProd CJ 70 production rig is currently under construction at Jurong Shipyard in Singapore and is scheduled for delivery in the 3rd quarter of 2010. The PetroProd unit is one of the world's largest production jack-up rigs, with legs of more than 200 m height and with a weight of approx. 33,000 tonnes.
All contracts contribute to the Dockwise strategic objective to materially expand activities in both rig transport (core business) and transport of offshore production facilities. The total value of the four (4) contracts is in excess of USD 25 million.
The financial guidance for 2008 is that adjusted EBITDA will increase by at least 60% relative to 2007.
For further information
Press Analysts
Jacqueline van den Bergen Fons van Lith
+31(0)6 22 44 84 35 +31 (0)6 51 31 49 52
Jacqueline.van.den.Bergen@dockwise.com Fons.van.Lith@dockwise.com
About Dockwise Ltd
Dockwise Ltd. has a workforce of more than 1200 people both offshore and onshore. The company is the leading marine contractor providing total transport services to the offshore, onshore and yachting industries as well as installation services of extremely heavy offshore platforms. The group is headquartered in Bermuda with amongst others operational offices in Breda, The Netherlands. The group's main commercial offices are located in The Netherlands, the United States, China, Korea, Australia and Nigeria. The Dockwise Yacht Transport business unit is headquartered in Fort Lauderdale and has offices in France and Italy. The Dockwise Shipping network is supported by agents in Japan, Singapore, Spain, Argentina, Australia and Italy.
For further information: www.dockwise.com
DRYS
Bullish on Commodities? Consider DryShips
posted on: April 01, 2008 | about stocks: DRYS
The parabolic growth rate of China and India, with a combined population almost ten times that of the United States, continues to drive an unending global demand for iron ore, coal, fertilizer, grain, and oil. This is clearly evidenced by recent trends in the leading positions within each sector.
Growth sector indicators (3/26/2008):
Company - Sector - Gain from 52-week low
Nucor (NUE): iron-mining 72 %
Vale (RIO): iron-mining 102 %
Rio Tinto (RTP): iron-mining 83%
Peabody (BTU): coal 36%
Fording (FDG): coal 138 %
Consol (CNX): coal 105%
Potash (POT): fertilizer 209 %
Mosaic (MOS): fertilizer 288 %
Transocean (RIG): deepwater drilling 69 %
Diamond (DO): deepwater drilling 49 %
The dry bulk carriers are the primary transporter of iron ore, coal, grain, and fertilizer – a necessary link in the global industrialization boom. DryShips, Inc. (DRYS), the largest U.S. listed dry bulker with a market capitalization of $2.3 billion, reveals staggering growth metrics. They own and operate a fleet of 39 vessels and 8 new builds including capesize and panamax vessels. Year on year revenue growth weighs in at 195% with earnings growth of 443.5%. A trailing price to earnings of 4.70 highly discounts the phenomenal growth. DryShips, operating on a combination of “spot charter” and “period time charter” rates, is well positioned to take advantage of the strength in rates and will likely continue to lock in longer time charters as the rates continue their upward trend. 63% of their fleet remains unfixed hence will benefit from rising rates. With the advent of summer and fall, the BDI is poised to begin its ascent from a recent value of 7884 and is expected to remain strongly bullish in the foreseeable future.
Based upon the current charter rates for vessels (2/15/08), DryShips’ daily revenue is approximately $2.25 million. Their average expense per day per ship in 2007 was $6,387. This extrapolates to daily expense of $249,093 for 39 vessels. The net daily revenue minus expenses is $2.01 million. Hypothetically, even if bulk rates do not increase for the remainder of the year, earnings for 2008 should be $822 million. Recent guidance from the company places 2008 EBITDA at $840 million. With the BDI close to its yearly nadir, both of these estimates could prove to be extremely conservative. For comparison purposes, 2007 revenue was $582 million. Also, in light of global demand, future estimates are likely conservative. At an average vessel age of 8.9 years, DryShips maintains one of the newest fleet of vessels in the industry. The older vessels typically have more difficulty obtaining long-term time charters and usually lease for lower rates due to increased dry dock time. Lack of financing, inadequate shipyards, limited crews with experience, and rising cost of steel all will mitigate an influx of new ships in the near future. Increased scrapping of older vessels, prized for the value of steel, should further restrict the pool of available vessels.
DryShips’ recent foray into deep water drilling adds another dimension for future cash flow. Their recent purchase of a 30.4% stake in Ocean Rig, ASA and current options to build two drillships marks their entry into the highly lucrative field of deep water oil drilling. Day rates for deep water drillships are expected to run upwards of $650k/day and major players Transocean and Diamond Offshore remain strongly bullish towards the sector.
Growth and value comparison (3/16/2008):
Company - Price - EPS 2008 - Current PE - Earnings Growth [YOY]
DryShips (DRYS) - 63.91 - 18.35 - 4.80 - 443.5%
Google (GOOG) - 458.19 - 19.91 - 34.5 - 17.0%
Research in Motion (RIMM) - 118.15 - 2.24 - 63.2 - 111.5%
Intuitive Surgical (ISRG) - 323.97 - 5.12 - 87.5 - 107.9%
First Solar (FSLR) - 220.19 - 2.48 - 108.4 - 682.2%
Baidu (BIDU) - 241.50 - 3.98 - 94.1 - 79.0%
Apple (AAPL) - 145.06 - 5.13 - 31.8 - 57.5%
Cash is King
As of 3/14/08, DryShips has available liquidity of $680 million and a net debt to capital ratio of 25%. With a peak price last year of $131.34 and a lack of significant relationship to the U.S. economy, a PE ratio of 4.8 seems a fire-sale price for this company. Conservative earnings growth estimates, based upon guidance correlated with a reasonable PE ratio of 10 to 15, would value the price per share at potentially $189 to $283. With recent consolidation in the mid $50 range, DryShips may well warrant a second look. As spoken by Warren Buffett:
"Most people get interested in stocks when everyone else is. The time to get interested is when no one else is."
http://seekingalpha.com/article/70695-bullish-on-commodities-consider-dryships?source=etrade
Mine too - can't help it. He has been through ditt och datt, and come out quite nicely.
Let's see whom he employs as FRO's next CEO. Now it's needed more than "two men and a dog" to manage it.. lol
FRO Sea Change/WSJ (click the link to see the pictures)
Billionaire Cashes In On Offshore Oil Rush.With Supply Scarce, His Rigs Are Hot; $600,000 Day Rate
By GUY CHAZAN
April 1, 2008; Page A1
LONDON -- As a buccaneering oil trader, John Fredriksen shipped crude from trouble spots like Iran and used hardball tactics to build up the world's biggest tanker fleet. The son of a welder, this modern-day Onassis is now Norway's richest man, worth at least $7 billion.
He is also one of a new breed of entrepreneurs reshaping the oil business.
The latest oil-drilling rigs are able to withstand storms and other threats, so they can be placed farther offshore. WSJ's Guy Chazan reports on West Venture, a rig owned by Norway's richest man, that is rented for $500,000 a day.
Mr. Fredriksen has amassed an array of state-of-the-art oil rigs capable of drilling in the world's deepest oceans. With production declining in mature basins like Alaska, the deep waters of the Gulf of Mexico and offshore Brazil and West Africa are oil's hottest real estate. But the rigs that can drill there are in short supply. That means contractors like Mr. Fredriksen can charge huge premiums for their services.
His success is part of a broader power shift from Big Oil -- the Shells, Exxons and BPs of the world -- to the oil-field-services sector. As they venture into ever harsher and more remote environments, the majors are becoming more reliant on these outside contractors -- geologists, well testers, seismic data experts and offshore drillers -- to find and extract their crude. The service companies are the new rule-setters in an increasingly costly game.
Helping to fuel their rise is a growing fear that the world's oil production may be about to plateau and decline. "Peak oil" anxiety has contributed to the steep increase in the price of crude, which has nearly tripled since 2004. Peak theory is now feeding into wider concerns that demand for all the world's resources -- not only oil but wheat, copper and other commodities -- is increasing faster than supply, creating new limits to global growth.
Mr. Fredriksen made an early bet many thought was insane. Three years ago, his company, Seadrill Ltd., broke one of the cardinal rules of the rig business. It ordered two "ultradeep water" rigs, capable of drilling in waters at a depth of at least 7,500 feet, for nearly $900 million -- on spec. It didn't have a single contract from an oil company to guarantee them.
"We didn't feel it was a risk," said Mr. Fredriksen, a 62-year-old with piercing blue eyes, elegantly attired in a blazer and cravat on a recent afternoon in his London office. "We knew there was a boom coming on."
There's no telling how long that boom will last. But Mr. Fredriksen sees years of strong demand ahead. The amount of oil pumped from deep-water fields will nearly double between 2005 and 2010 to about 11 million barrels a day, according to the U.S. Energy Information Administration. Douglas-Westwood, a consulting firm, says capital spending on deep-water oil will rise to $25 billion annually by 2012, nearly double the figure for 2003.
Yet there are only 39 rigs in the world capable of drilling in ultradeep water. Seadrill has four of them, with eight more under construction. While there are older companies that are bigger than Seadrill, few have such a modern fleet.
That gives Mr. Fredriksen enormous pricing power. His units are in such demand he can charge major oil companies nearly $600,000 a day to use them. Similar rigs were earning about $70,000 a day just five years ago. With leasing rates like these, a vessel that cost half a billion dollars to build can pay for itself in as little as four years.
The Oil Outsider
John Fredriksen was born in a working-class Oslo suburb in 1944. His humble background set him apart from Norway's blue-blooded shipping aristocracy -- men like Sigval Bergesen and Anders August Jahre, the Nordic equivalent of the Vanderbilts and Rockefellers. They, along with the tycoons of Greece and Hong Kong controlled the world of international shipping in the postwar years. "There was an Ivy League of shipowners -- the founding fathers of the business," says Boris Nachamkin, one of Mr. Fredriksen's first bankers. "He was the outsider."
His first job was as a shipping broker, running cargoes of fish from Iceland to Hamburg, Germany. After brief stints in Canada and New York, he moved to Beirut in the late 1960s. There he shipped crude out of Saudi Arabia and Iraq and sent back cargoes of refined products. He soon developed a firm grasp of the oil trade. "He knows how oil moves, who gets it when it's tight and when it's flowing quickly," says Morten Arntzen, another of Mr. Fredriksen's former bankers and later a business partner.
By the mid-1970s, shipping was in deep trouble. The 1973 Arab-Israeli war sent oil prices into orbit. Fuel consumption plummeted in the West, and demand for long-haul tankers collapsed. Many venerable shipping companies went bust in the slump and Norway's fjords were full of empty tankers. Mr. Fredriksen sensed an opportunity. He started leasing cheap ships and later buying many of them outright.
[John Fredriksen]
In the 1980s, Mr. Fredriksen was one of the few traders exporting Iranian oil during the Iran-Iraq war, shuttling tankers through the Persian Gulf from Kharg Island, a big oil terminal that was repeatedly targeted by Saddam Hussein's air force. Mr. Fredriksen says his tankers were hit three times by Iraqi missiles.
A noted reveler, he would often hold court throughout the 1980s at Oslo's fashionable Theatre Café. Locals nicknamed his regular table there Kharg Island.
"When he was traveling, he needed three brokers with him -- one recovering from the night before, one on duty and the other preparing for the next day," says Clarence Dybeck, a fellow shipowner from Sweden. "He had a tremendous capacity for work."
In the world of Norwegian business, he tended to keep a low profile. He never admitted to owning any ships, claiming instead to be acting on behalf of a group of unnamed investors. That was common in the industry, where shipowners could be held liable for wrecks and oil spills, says fellow Norwegian Tor Olav Troim, vice chairman of Frontline, Mr. Fredriksen's shipping company.
"I was more secretive" in those days, says Mr. Fredriksen. Domestic critics denounced him for shipping oil to South Africa, in defiance of the apartheid-era trade embargo. He says all Norwegian shipping firms did it.
In 1985, he moved to Cyprus, lured by lower taxes and the island's reputation as a shipping center. "It's almost impossible to do business in Norway today," he says, citing the tax regime and frequent regulatory changes. In 1986, the Norwegian authorities charged him with fraud, alleging that his tankers were found to have used customers' cargoes for fuel. Police raided his offices in Oslo, and he turned himself in a few days later. The main charges were later dropped and he paid a fine on a lesser charge. But the affair still rankles: It was motivated by "jealousy" of his success, he says.
Mr. Fredriksen's penchant for secrecy changed in 1996 when he bought Frontline, a publicly listed Swedish shipping company. It soon grew into a giant, and a key force in the consolidation of the fragmented shipping business. In 1996 he owned seven tankers. By 2001, Frontline had 70. The company today has the world's biggest tanker fleet, with 86 vessels.
Hardball Tactics
A year after he bought Frontline, he launched a hostile takeover bid for ICB Shipping, a Swedish tanker firm. His methods -- full-page ads in local newspapers, angry letters to ICB board members, pressuring shareholders -- shocked some Swedes. "No one had seen those sort of tactics before in Sweden," says Clarence Dybeck, the then head of ICB. "He could be quite brutal." After a grueling two-year battle, he finally won control of the company.
Mr. Fredriksen was meanwhile benefiting from big changes in the oil-shipping industry. After notorious oil spills like the Erika, a tanker which broke up off the coast of France in 1999, oil companies stopped chartering dangerous single-hull tankers. Such ships have a single outer shell between the oil and the ocean; double-hull tankers, which have an extra space between hull and storage tank, are considered safer. Shipowners who had invested in double-hulls cleaned up. John Fredriksen was one of them.
The tanker business was also coming out of its slump. Fields close to the big oil-consuming countries -- in the North Sea, Alaska and Mexico -- were declining. Crude was increasingly coming from faraway places like West Africa and the Middle East. China and India were emerging as major oil importers. Long-haul tankers were back in vogue. With his expanded fleet, Mr. Fredriksen cashed in on a freight market that was entering a new golden age. By 2001, the chartering rates paid by the oil companies to ship crude around the globe were the highest they had been in 30 years.
Already a billionaire, in 2002 he bought the Old Rectory, a mansion in London's ritzy Chelsea district, from the Greek shipping family of Theodore Angelopoulos, for £38 million (at the time, about $57 million), one of the highest prices ever paid for a London home. The house has a rich history: The Battle of Waterloo was planned in its garden.
He also continued to diversify. He currently has stakes in dozens of businesses, from shipping to fish farming to oil trading. His empire includes "dry bulk" ships, those that carry things like coal, steel and grain, as well as liquefied-natural-gas carriers and tugboats that supply offshore oil platforms. His company Marine Harvest is the world's biggest producer of farmed salmon. Among other investments: Aktiv Kapital, a buyer of distressed consumer debt, and Arcadia Petroleum, a big crude-oil trading firm.
A Big Rig Bet
One of his boldest moves, in terms of startup costs and the risk of failure, was into the drilling business. As oil prices began their ascent in 2003, contractors were putting in big orders for mobile drilling platforms that operate in shallow waters. But Mr. Fredriksen says his contacts in Asian shipyards told him the majors weren't investing enough in deep-water rigs.
Yet deep-water drilling's potential was clear: Offshore Angola, some companies drilling for crude had an unprecedented 95% "hit" rate, says Mr. Troim. Messrs. Fredriksen and Troim started ordering semisubmersibles, or "semis" -- one of the most advanced kind of floating rigs. In June 2005, a month after taking the newly created Seadrill public, they commissioned two semis, one for $394 million and another for $490 million. "Everyone was laughing at us at the beginning," says Mr. Troim. "We were Mr. Nobody."
Larger than a football field, semis are floating vessels, supported by big pontoonlike structures submerged below the sea surface, that can operate in waters up to 10,000 feet deep. Dynamic positioning -- a computer-controlled thruster system fed by data from satellites and transponders located on the seabed -- keeps them in place directly above the oil well. The price tag for such a vessel is now around $655 million.
Seadrill expanded aggressively, ordering new rigs and swallowing up competitors in a flurry of deal making. Its market value has grown from $200 million when it listed in 2005 to $10.5 billion today.
"Fredriksen and Troim move very fast," says Odd Harald Hauge, a Norwegian journalist who has written two books on Mr. Fredriksen. "They do deals on napkins."
A Wave of Mergers
One of their most daring acquisitions was of Smedvig ASA, a big Norwegian driller, in January 2006. Noble Corp., a U.S. rival, had taken a 30% stake in the company, but Seadrill snapped up shares and eventually forced Noble to sell out. "We bought that in a taxi in Seoul," says Mr. Fredriksen.
The revved-up drilling sector was being swept by merger fever. In July 2007, Transocean Inc. and GlobalSantaFe Corp., the world's two biggest offshore-drilling contractors by market value, agreed to an $18 billion merger. Seadrill itself has often been touted as a potential takeover target by a more established U.S. or Asian driller. Mr. Troim said it approached some U.S. rivals about a tie-up in 2006, but the talks went nowhere.
A merger would help solve one of Seadrill's key problems -- a lack of staff, especially engineers and drill operators who are in short supply. Seadrill has tried to deal with that by aggressively poaching managers and crews from its peers. The company recently hired one of Transocean's top executives to run its Houston office.
There are some worries the sector's boom may be unsustainable. Analysts fret that contractors may have ordered too many rigs, which will lead to overcapacity and a collapse in day rates. But others say high oil prices, which underpin the business, will stay lofty for years to come, and that with many rigs contracted out well into the next decade, the deep-water drillers have a bright future.
For the time being, the majors are in a bind. In the 1990s, when oil slumped to $10 a barrel, they aggressively cut costs, shed jobs and divested themselves of assets. When oil prices recovered, they often lacked personnel and equipment and were forced to outsource a lot of the work of drilling and extracting crude.
Some of the majors are now resorting to building their own, cheaper rigs. Royal Dutch Shell PLC has designed a new class of drilling vessel, the bully rig, which it says is suitable for both deep-water and arctic conditions and will cost 20% less to lease than the competition. But it will only take delivery of the first two in 2010.
Mr. Troim was recently in Houston meeting with potential customers: One person familiar with the talks said oil executives came away shaken by the sky-high rates Mr. Troim was demanding -- up to $600,000 a day. Mr. Troim says Seadrill's charges are typical for the industry, and the market can bear them. "It's been fun to see a company grow from two men and a dog to being a major player in this market," says Mr. Troim. "More fun than making money."
http://online.wsj.com/public/article_print/SB120700920323078811.html>
GM Wildbill. DPDW is in right business, and ElectroWave and Mako are also beginning to bring profits to the company. Looks like they will have a good year ahead.
SDRLF.PK $27.25 Seadrill Limited /OSE: SDRL /ISIN: BMG7945E1057
Published: 09:06 01.04.2008 GMT+2 /HUGIN /Source:
SDRL - Successful delivery of the deepwater drilling rigs West Phoenix and West Sirius
Seadrill yesterday took delivery of the deep water drilling rigs West Phoenix and West Sirius from the Samsung Shipyard in South Korea and Jurong Shipyard in Singapore, respectively.
West Sirius was delivered within 30 days from original delivery schedule, while West Phoenix, due to customer initiated modifications, was delivered approximately three months after original contract date. Both drilling rigs were delivered with only minor deviation to the budget which was agreed when the rigs were fixed to the charterer.
The units will proceed for mobilization, and estimated time of arrival for West Phoenix in the North Sea is in the beginning of the third quarter 2008, and estimated time of arrival for West Sirius in the Gulf of Mexico at the end of the second quarter 2008.
Both drilling units have secured long-term contracts. West Phoenix has a three-year contract with Total Norge to utilize the unit in the North Atlantic region. West Sirius has a four-year assignment with Devon Energy Corporation to utilize the unit in the Gulf of Mexico.
West Phoenix and West Sirius are both sixth generation, deep water, state of the art drilling units and some of the most advanced drilling rigs ever built, based on proven designs and performance.
The drilling units belongs to a high specification, new generation drilling units, focusing on a broader spectre of capabilities, a larger operating area, a high load carrying capacity, decreased dependence on frequent supplies, efficiency and improved safety and working environment as well as a special environmental focus, minimizing the exposure to the environment. The drilling units are designed with a dynamic positioning system and a water depth capability up to 3,000 meters. In addition, West Phoenix is designed with a dual derrick and is constructed for winter operations in northern and arctic areas.
Commenting on the delivery, Chief Executive Officer in Seadrill Management AS, Kjell E Jacobsen said: "Seadrill has reached a highly important milestone with the delivery of the first two newbuild deepwater drilling units out of eight units to be delivered this year".
Project costs for each of the two units are in line with what have been previously reported.
Upon commencement of the contracts, Seadrill will invoice their two customers approximately US$70 million in mobilization payments.
Chairman John Fredriksen in Seadrill Limited says in a comment : "The completion of the two newbuilding projects confirms the Seadrill organization's ability to manage complex projects within time and cost and is a great achievement for our organization and the people involved. It also confirms that the Seadrill strategy to order newbuilding units with highly reputable yards like Jurong and Samsung is paying off.The combination of a favorable contracting price, good charter agreements and sound newbuilding execution with timely execution will yield significant return to our shareholders".
RDC $41.18
Oil Driller Rowan To Get Rid Of Manufacturing Unit
Monday March 31, 6:43 pm ET
Marilyn Much/Investor's Business Daily
Oil and gas companies have stepped up the search for new supplies, fueling strong demand for drilling service providers to help do the work.
Drilling contractor and related equipment manufacturer Rowan (NYSE:RDC - News) is cashing in on a couple of fronts.
Shares rose 8.7% Monday when the company announced it will divest itself of its manufacturing unit.
If the deal goes through, the company says it will buy back at least $400 million in stock.
Rowan provides contract drilling services to oil and gas companies using a fleet of 21 self-elevating mobile offshore drilling platforms, or jack-up rigs, and 29 deep-well land rigs.
Its manufacturing arm is called LeTourneau Technologies. LTI produces drilling products, including jack-up rigs, mud pumps and variable speed motors. It also makes equipment for the mining and timber industries. Products include large wheeled front-end loaders and diesel-electric powered log stackers.
The unit has designed and produced all of Rowan's jack-up rigs. It also makes gear for outside customers. It's designed or built about 33% of all jack-up rigs in operation worldwide, the company says.
Though LTI has been a strong contributor, the company on Monday said it would pursue a "monetization" of LeTourneau, meaning the unit will either be sold, spun off or taken public by an IPO.
"Given LTI's record performance in 2007 and strength heading into 2008, we believe that now is the appropriate time for Rowan to crystallize the value we have created in LTI for the benefit of shareholders," said Chief Executive Daniel McNease in a statement Monday.
In the fourth quarter, the unit's revenue climbed 93% from the prior year.
"They'll be looking to sell some portion of the business up to 100%, either through a private transaction or capital markets transaction like an IPO or a spinoff," said analyst Tom Curran of Wachovia Capital Markets. "We think it's a positive because the discernible benefits of owning its own rig equipment manufacturing division didn't seem to meaningfully outweigh the costs."
Lehman Bros. and Morgan Stanley will assist Rowan in the process.
Investors cheered the news, sending Rowan's shares soaring.
Rowan focuses on so-called high specification, premium jack-up rigs used for both exploratory and development drilling. Depending on the particular rig and location, it's capable of drilling to depths of up to 35,000 feet in water up to 550 feet.
Executives weren't available. But, like a lot of its peers in the drilling services business, Rowan is benefiting from high oil and gas prices and its customers' aggressive search for more supplies.
From 2005 to 2007, earnings have grown at a 112% annual clip and revenue has increased at a 45% rate.
Its customers have a lot of cash to spend, says analyst Michael Henzi of Sterne, Agee & Leach.
And judging from the company's results, many of them are spending big bucks with Rowan.
Fourth-quarter earnings climbed 86% from a year ago to $1.23 a share, buoyed by higher jack-up rig usage and increased drilling rates. Revenue jumped 52% to $623.6 million.
During the quarter, the utilization rate of its offshore rigs was 97%, up from 81% the prior year.
The company's average offshore day rate rose 14% to $164,300. The day rate is the daily cost the customer pays Rowan for renting the drilling rig and the associated costs of personnel and routine supplies.
Its land rig utilization rate was 94%, off from 95% a year earlier. Its average land rig day rate rose 1% to $23,000 vs. the prior year.
As of Feb. 28, Rowan's backlog of drilling contracts stood at about $2.1 billion.
For the full 2007, earnings rose 48% to $4.09 a share.
High oil and gas prices throughout the year had a positive impact on results, said CEO McNease in a conference call.
"We expect to see a continuation of high prices during 2008, if worldwide demand for oil and gas continues to pressure supply," he said.
This scenario enables Rowan's customers to invest heavily in exploration and production, resulting in strong demand for premium drilling equipment, he added.
Another plus: He says demand for high-specification jack-ups remains strong in the Middle East, the North Sea and other overseas markets.
Rowan is the world's No. 8 drilling contractor and the No. 6 jack-up rig operator, the company says.
It distinguishes itself by focusing on the high-spec, heavy-duty end of the market across all three of its businesses, says analyst Curran.
"Of Rowan's 21 jack-up rigs, 10 are high-spec, heavy-duty units designed to efficiently execute the most technically challenging wells being drilled today, including ultra-deep gas wells and extended, horizontal wells," he said.
He says seven of these rigs are capable of operating in the world's deepest and/or harshest shallow water basins.
Off-the-record comments by Rowan's customers indicate it has the best quality jack-up rigs and crews, says analyst Henzi.
"As such, Rowan often receives a slight premium for its jobs vs. similar rigs for competitors," he said.
Rowan plans to add nine jack-up rigs to its fleet with deliveries starting in this year's third quarter and continuing through 2011.
In addition to its focus on the high-spec, heavy-duty end of the market, Rowan differs from its peers on other fronts. It's the only U.S. publicly traded company in its field that offers exposure to both land and offshore contract drilling, says Curran.
Still, its jack-up drilling business is Rowan's bread and butter. Curran figures this business will account for 52% of his estimated 2008 revenue for Rowan.
Rowan is also the only U.S. publicly traded company in its field that offers the combination of contract drilling services and manufacturing, he adds.
LTI has given Rowan an edge over its rivals, watchers say.
"Its manufacturing arm allows them the ability to take rigs into repair and repair them at their own schedule, and they are rarely late," said Henzi. "It also allows them to have a cost for their rigs lower than anyone else."
Followers expect Rowan to keep growing at a rapid clip.
Analysts polled by Thomson Financial expect 2008 earnings to rise 15% to $4.71 a share, then another 15% in 2009.
Rowan's McNease says the worldwide jack-up market is strong with demand outpacing supply.
"We believe that a current forecasted supply deficit of 44 to 58 jack-ups exists worldwide for projects in 2008 and 2009," he said in a conference call.
TheStreet.com Ratings
Top Five Fast-Growth Stocks
03/31/08 - 09:04 AM EDT
- - -
Atwood Oceanics (ATW $91.42 - Cramer's Take - Stockpickr) is a Houston-based international drilling contractor, engaging in the offshore drilling and completion of exploratory and developmental oil and gas wells worldwide. The company also provides related support, management and consulting services.
We have rated this company a buy since September 2004 based on revenue growth, a solid financial position, earnings per share growth and solid stock performance. Revenue rose 49% in the fourth quarter of 2007 to $121.6 million, up from $81.8 million in the fourth quarter of 2006. Atwood's debt-to-equity ratio is very low at 0.03, implying successful management of debt levels. During the past fiscal year, the company increased its bottom line by earning $4.37 a share vs. $2.75 a share in the prior year. Atwood Oceanics has demonstrated a pattern of positive EPS growth over the past two years. Finally, the stock has surged 72% over the past year, powered by its strong earnings growth.
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RDC $40.77 Why is Rowan selling its rig maker?? Hmmmm....
UPDATE 1-Rowan to sell or spin off manufacturing unit
Mon Mar 31, 2008 10:39am EDT
March 31 (Reuters) - Rowan Cos Inc (RDC.N: Quote, Profile, Research), a provider of contract drilling services, said it would pursue a sale or a spin-off of its wholly owned manufacturing unit, LeTourneau Technologies Inc, sending its shares up more than 8 percent.
Rowan said it would be assisted in the process by its financial advisers, Lehman Brothers Inc (LEH.N: Quote, Profile, Research) and Morgan Stanley & Co Inc (MS.N: Quote, Profile, Research).
The company also said that it entered into a pact with Steel Partners II L.P., which owns a 9.1 percent stake in Rowan, and added that Steel Partners had agreed to withdraw its slate of three nominees to Rowan's board.
In January, Steel Partners had said it was seeking three seats on Rowan's board, adding that its nominees, if elected, would work with the board and management "to implement a strategy to unlock that intrinsic value of the company."
According to the pact with Steel Partners, if Rowan does not monetize LeTourneau by the end of 2008, either Warren Lichtenstein, managing member of Steel Partners, or another person designated by Steel Partners will be added to Rowan's board effective Jan. 1, 2009, Rowan said in a statement.
If the monetization is completed through an initial public offering of LeTourneau shares or a private sale, Rowan will repurchase at least $400 million of its outstanding common stock, the company said.
LeTourneau, which supplies offshore jack-up drilling rigs, built the world's first jack-up drilling rig in 1955.
Rowan shares were up 8.13 percent at $40.96 in morning trade on the New York Stock Exchange. (Reporting by Sharangdhar Limaye in Bangalore; Editing by Himani Sarkar)
NE $50.48 29-years contract?!!
UPDATE 1-Noble signs for $4 bln in Brazil rig contracts
Mon Mar 31, 2008 10:58am EDT
HOUSTON, March 31 (Reuters) - Noble Corp (NE.N: Quote, Profile, Research) said on Monday it signed a memorandum of understanding for contracts possibly worth $4 billion with Brazil's Petrobras (PETR4.SA: Quote, Profile, Research) (PBR.N: Quote, Profile, Research), sending the shares of the offshore oil and gas drilling contractor up almost 5 percent.
Under the planned contracts which have a combined total length of 29 years, five deepwater drilling rigs currently operating off Brazil would extend their work for Petrobras, bringing Noble's total backlog to more than $10 billion.
Brazil is seen as a hot market for oilfield service companies as state oil company Petrobras will need to spend heavily to develop complex offshore fields including its massive Tupi find in the Santos basin.
Under the proposed deal, the Noble Paul Wolff, a dynamically positioned semisubmersible rig, will have a dayrate of $490,000, up from its prior rate of $163,000 to $165,000.
Another semisubmersible, the Noble Therald Martin, will be booked at a rate of $295,000 per day, up from $113,000 to $115,000.
Upon completion of upgrades, the drill ship Noble Roger Eason will go to work for a dayrate of about $400,000, up from $136,000 to $138,000.
The Noble Leo Segerius drill ship will be booked at a rate of $345,000 per day, up from current rates of $123,000 to $125,000, and the Noble Muravlenko won a contract for about $330,000 per day, up from $119,000 to $121,000.
Shares of the Sugar Land, Texas-based company were up $2.14, or 4.5 percent, to $50.19 in late morning trade on the New York Stock Exchange. (Additional reporting by Matt Daily in New York) (Reporting by Anna Driver in Houston, editing by Mark Porter)
Milner. The ex-day of DESSC's dividend $0.40 was March 26, and the payment will take place in 2-3 weeks, the exact date will be informed later. I do not know about the future dividends, but I would guess that only serving Seadrill's rigs (ca 30 units now, 37 by the end of 2010) the income looks trustfull.
I have not heard anything about DOCK paying dividends yet. They have informed that it is DOCK's intention to become a dividend paying company - and I trust them in that. If you are interested in DOCK, buy small amounts untill you are more convinced about the company's success. Remember, if you feel yourself uncomfortable with your investment, you have put too much money in it.
You may have noticed that these marine businesses are targets of heavy speculation, which causes much uncertainty and volatility. I have decided to only trust the companie's reports and press releases, and in addition try to follow the oil and gas markets. Rigzone is a good site to read about the latest in oil drilling.
http://www.rigzone.com/
I am no expert in shipping or drilling, I have only followed these sectors a long, long time (I bought FRO when it was $6-10), and almost all my investments are in these industries, mostly in these Norwegian companies we are discussing now. Of course I have collected much information during those years, and I am glad if I can share something to those, who have become interested into the sector later :)
As to the liquid mud, it is a sort of lubricant you need in the drilling tube to help the mud (sand, clay, stones) come out and up of the drilling hole. You need big amounts of these fluids (various compositions of chemicals and water), and therefore there are special ships (kind of tankers) to feed the offshore drilling rigs. Here's some information:
DRILLING FLUIDS:
Drilling fluids are very vital to any drilling operation. Drilling fluid normally called mud is pumped through the drill string while drilling is taking place. This mud exits out at the bit and comes back through the annulus and flow line. This mud helps to bring back cuttings of the drilled formation to the surface. These cuttings are then studied by the geologist to get information of the subsurface formation. This module deals with the properties, important functions and the behavior of fluids in the hole.
More information about offshore services: Boat types ATHS, OSV/PSV
The Offshore Supply Boat Sector
by Dan Barrett
Sector Background
The offshore supply boat sector provides transportation services to offshore drilling rigs, fixed platforms, and floating platforms. The main services provided are: 1) Delivering drilling supplies, fuel, water, and food. 2) Moving personnel to, from, and between offshore installations. 3) Towing rigs from one location to the next and placing or retrieving its anchors. 4) Providing safety and emergency response services and, 5) Supporting offshore construction projects.
Boat owners charge a daily fee for the use of a vessel. The rate depends upon a multitude of factors. Those factors include: the type of boat, the length of the contract, the supply/demand balance at the time of the contract, and where the boat is located (e.g. W. Africa, Gulf of Mexico, etc.). Boats can trade the spot market, meaning contracts are short in duration and only last as long as the task at hand or they can be on long-term contract, ranging in length from a few months to a few years. In the Gulf of Mexico and the North Sea boats typically trade on the spot market, but places like West Africa and Brazil typically have long-term contracts. Crew boats typically charge the least, followed by supply boats and then anchor handlers. Rates can range from as little as $2000/day for a crew boat during lean times to $40,000/day for an anchor handler during peak times. We describe boat types, typical rates, and regional differences in Section 3 of this report.
The supply boat market is cyclical with a high degree of operating leverage. This is a tough business to operate. Business volumes, measured in operating days per vessel, can climb or fall 15% or more during periods of rapid expansion or contraction. For example, during the crash from Mar-98 to Mar-99, Tidewater, the biggest supply boat company, saw its operating days per vessel drop 15%. This business also has a high degree of operating leverage. About 70% of the daily cash operating costs are fixed, so changes in activity levels have a dramatic effect on profitability. Again using Tidewater as an example, from fiscal 2001 to fiscal 2002 revenue climbed 18% but operating income increased 133%.
The industry has been plagued with over-capacity. There was a massive boat building boom in the late 1970s and early 1980s when the oil industry was experiencing record oil prices and activity levels. Many of those boats are still with us today and, over the past 20 years the excess capacity was only absorbed twice (1997 and 2001). However, the expected useful life of a boat is around 25 years, so we should see a fair number of boats leaving the market over the next 5 years. The health of the supply/demand picture in 5 years will depend on how many new boats are built between now and then where demand stands. We think that the situation will be marginally better but market power will likely still favor oil companies. We discuss our expectations in greater detail in the outlook section of this report.
Barriers to entry – they have risen substantially over the past 25 years, but are still relatively low. In the early 1980s, if a group of affluent individuals wanted to invest in the booming oil business, they could raise three million dollars, build a boat, find an ample supply of captains and crew, and presto, they were in the supply boat business. Things have changed since then, but not drastically. It would cost about $20-$40 million to build a competitive boat today, depending upon its type and features. Crews would be harder to find as technical and regulatory requirements have increased markedly and the supply of skilled personnel has declined significantly. Nevertheless, those barriers are far from being insurmountable. An industry veteran with access to capital can easily jump into the business. For example, Larry Rigdon, who founded Rigdon Marine after losing his bid to become CEO at Tidewater, is on his way to having 10 state of the art supply vessels in the Gulf of Mexico.
Boats are a commodity item. Although there are substantial differences between boats built today and those built 25 years ago, there is little to differentiate between two new boats or two old boats. Even the decision to use a new boat or an old boat for a particular job boils down to the overall economics. Therefore, boat owners compete primarily on price. The underlying reason is that there is nothing extraordinarily proprietary about a boat’s design or abilities. If one company can design a boat to carry 5000 tons of cargo and discharge fuel and water at 1000 gal/minute, so can the next company.
Boats Types
There are many different types of boats that provide services to the oil & gas industry. Some are designed to transport crews to, from, and between oil rigs and platforms, while others are used to deliver supplies to rigs or tow a rig from one location to another. The line between different asset classes can become blurred as many boats are built with functionality that crosses over into another boat’s domain. Below we describe the main types of vessels used in the oil industry, the evolution of each, and factors that affect day rates.
Anchor Handling Towing Supply (AHTS)
Anchor Handling Towing Supply vessels, or AHTS vessels, tow rigs from one location to another and are equipped with powerful winches which are used to lift and position the rig’s anchors. In addition, many can carry moderate amounts of supplies such as drilling fluid or drill pipe and also support offshore construction projects. Variations of the AHTS vessel include those that can only handle anchors and tow rigs (i.e. they can’t carry supplies) and others that can only do towing work. AHTS vessels are usually specified in terms of horsepower (BHP) and towing capacity.
The current size of the AHTS fleet at 1562 vessels with another 120 on order, according to Clarkson research. Almost 75% are over 20 years old. We do not believe that all 1562 are still working in the oil industry and would not be surprised to find out that many of those boats are not actively employed or that they are in such a state of disrepair that they will never work.
New generation, deep-water capable vessels typically have much greater horsepower (at least 8000 BHP) and winch strength (at least 250 tons). Winch strength determines the size of an anchor and the maximum depth to which it can be placed. In addition, their winches also have longer spooling lengths, which are needed to place anchors in deeper waters. Most have dynamic positioning capability (although that is not an absolute requirement). Dynamic positioned vessels use global positioning systems and computer controlled propulsion systems that allow the boat to maintain an exact position, regardless of wave and wind forces. In addition, a vessel that is typically built today can carry more supplies than its 25-year-old peers.
Offshore Supply Vessels (OSVs)
Offshore Supply Vessels, or OSVs, deliver drilling supplies such as liquid mud, dry bulk cement, fuel, drinking water, drill pipe, casing and a variety of other supplies to drilling rigs and platform. OSVs are also referred to as PSVs (Platform Supply Vessels) – they are the same thing, although some industry participants like to think of a PSV as the larger version of an OSV. Offshore supply boats are usually specified in terms of cargo carrying capacity, measured in dead weight tons (dwt), but it is more common just to specify the boat by its length (in general, the two specifications are highly correlated).
We estimate the size of the current OSV fleet at about 1014 boats, with another 84 on order. Sixty-three percent of the fleet is over the age of 20 years. We do not believe that all 1014 are still working in the oil industry and would not be surprised to find out that many of those boats are not actively employed or that they are in such a state of disrepair that they will never work.
The majority of boats in service are old, legacy boats built during the boom in the late 1970s/early 1980s. A typical boat from that era is about 180 ft. (55m) long, can carry about 1200 barrels of liquid mud and about 1000 tons (dead weight tons, or dwt) of deck cargo. In addition, keeping this type of boat on station beside the rig or platform was closely tied to the captain’s ability to read the wind and waves and make adjustments using a single bow thruster and an antiquated control system. New generation boats can carry three to ten times as much liquid mud, two to four times as much deck cargo and the captain has a joystick and computer assisted global positioning systems with multiple thrusters to control the boat. We summarize the differences between the boats built in the late 1970s and early 1980s relative to boats built today in Table 4 below.
One important point worth mentioning is that not all new generation boats are deepwater capable. This is particularly true for OSV class boats. New generation OSVs that are not deepwater capable are still much superior to their older 180 foot peers. However, they still cannot challenge new generation deepwater boats when competing for work in deepwater environments. We believe that most new boats under construction will be deepwater capable (but not all). Tidewater, the largest player in the industry has a relatively large number of new generation boats that were not designed for the deepwater.
Crew Boats
Crew boats transport personnel to, from, and between offshore rigs and platforms. These boats are much smaller than their AHTS or OSV cousins, and can range in size from 75 ft to 190 ft (23m – 58m). Crew boats are generally specified by cruising speed. The smallest boats (75 ft) are typically used to transport crews between offshore installations and not to and from shore.
Newer generation crew boats, called Fast Supply Vessels (FSV) can also carry very limited amounts of supplies and as such are often used for emergency or time sensitive deliveries of supplies in addition to transporting crews. Differences between old, legacy crew boats and new generation boats are shown in Table 5 below. We believe that there are at least 500 Crew boats worldwide.
Standby / Rescue Vessels
Standby/Rescue boats typically operate in the North Sea due to regulatory requirements. These vessels are required to remain in the vicinity of offshore rigs and platforms in order to provide emergency response services, such as personnel rescue, fire fighting, and first aid. There are about 235 of these vessels in service and we believe the vast majority are located in the North Sea as we are not aware of any other region with the same regulatory requirements.
Other Types of Vessels
There are a variety of other types of vessels used by the oil & gas industry, Vessels include:
* Utility/Workboats, which perform a lot of work in support of offshore construction projects.
* Survey vessels, which collect geophysical data.
* Well stimulation vessels, which perform fracturing and acidizing of producing wells.
* Multi-Purpose Supply Vessels (MPSV) which can provide and combination of remote subsea intervention services, remote operated vehicle (ROV) operations, deep-water lifting & installation, delivery of supplies, fire fighting, and oil spill recovery.
In addition, there are other boats that carry out maintenance work, pollution control, and diving support.
There are over 700 of these various types of vessels worldwide.
Market Outlook and more
Click here to download a full report (1 MB) including Outllook, Day Rate Analysis, and more information pertaining to the Offshore Supply Boat Sector.
Dan Barrett is a Senior Analyst of the Oil Services and Shipping industries for Fortis Bank. To contact Mr. Barrett directly you can email him at dan.barrett@fbfinance.com or by phone at (212) 303-4810.
brought to you by Rigzone.com
URL: http://www.rigzone.com/news/insight/insight.asp?i_id=163
Present situation in vessel newbuilding. The growth of both supply and demand has been astonishing:
http://download.hellenicshippingnews.com/pdf/worldyards/RealityCheck3years%20on.pdf
I added the link of Worldyards in the iBox. It will be most interesting to see how many ships will be scrapped in 2008-2010.
International Maritime Organization (IMO), an United Nations organization, has regulated that by the end of 2010 all single-hull tankers will be converted into double-hull or scrapped. Western countries have adapted the rule but there is a general suspicion that the Asian countries will not obey it, and over 30-years old singlehull tankers will still haul oil on extremely cheap dayrates.
(By all means - if they get somebody to insure their cargoes lol..)
South-Korea newly announced that it will not allow singlehull tankers in its territorial limits. That order came after an oil tanker/tugboat accident and quite a big environmental disaster on its western coast. South-Korea's decision will diminish the number of singlehull tankers remarkably, so they will either be rebuilt or scrapped.
Since 1996 it has not been allowed to build new singlehull tankers.
More indicative figures about the tanker world:
http://www.intertanko.com/templates/Page.aspx?id=18831
A good show of the cyclicality of tanker rates:
http://www.brs-paris.com/modif/picBrs/tank_crude_vlcc.gif
DOCK Here's a good description how the heavylift work is done:
March 13, 2008
1/6
Maari Project halfway there!
On March 7th 2008 an important milestone in the Maari Project has been achieved
when the load out of the wellhead platform was succesfully executed on the Blue
Marlin at the Kencana Yard in Lumut- halfway in the Mallacca Strait on the west
coast of Malaysia.
Dockwise management appointed this contract as a project in October 2006,
because of the extended scope of this contract and the high risks involved in the
tranport. The transport: Singapore: bunkering, Batam Indonesia: preparation works
and installation of grillage, Lumut Malaysia: load out, Admiralty Bay - Northern part
of South Island New Zealand: float off.
The extended scope were to be a new experience for Dockwise, when we took on
the responsibility of the design of the grillage, skidbeams and seafastening. This
meant a real challenge for our structural engineers, because the forces – generated
in the 150 metres high and over 10.000 ton weighing platform tower – will come
into the vessel’s deck almost only through the four tower legs: In the harsh
environmental conditions of the Tasman Sea that could cause over 10.000 tons per
square meter pressure into the deck! Truly state of the art engineering realized a
grillage that could cope with such forces.
The risks that were to be conquered and controlled are:
The location of the fabrication yard, which is situated in a shallow creek, that does
not exist on a nautical chart. The largest heavy lift vessel in the world had to go in
there and come stern to for the load out quay. Detailed dredging specifications were
supplied by the project team, and a mooring procedure was issued and approved by
all authorities involved.
Once moored stern to, the vessel had to be able to cope with a tidal rise and fall of
the water of over 70 cm per hour, whilst the platform was hydraulically pushed -
skidded out –from the quayside on the vessel at a planned 5 metre per hour rate.
An extra external ballastsystem was engineered and installed without endangering
the projects critical path.
For the transport the main challenge for the team was to come up with sufficient
seafastening, that would not damage the weak construction of the bottom part of –
the so called skirt – of the platform, that was not designed for this at all. It was
done at the cost of time of a planned twelve days of welding work.
2/6
The challenge at the float off will be the fact, that the skirt of the platform is hollow
and therefore will not float. The complete contruction will only start to float on the
platform above the skirt. This means that the Blue Marlin must submerge without
having the needed stability of the platform. However, the skirt catches airbubbles
when it submerges and with the help of a barge, loaded on the forward part on deck
of the Blue Marlin, it will be possible to have enough stability during submerging of
the vessel and reach sufficient clearance between vessel and platform to float it off.
The ballasting procedure for submerging has been thorougly prepared,
incorperating the control of eight airbubbles under the skirt!
Impressions of the load out:
March 4th 2008:
Off the chart, into the creek, 1.3 meter underkeel clearance.
3/6
Anchoring in the mangroves.
March 5th 2008:
View of external ballasting system and stability barge, Dockwise scope of work.
4/6
March 6th 2008:
First skidshoe on board, 523 millimeter spare between casing and platform. Good
view of Dockwise designed skidbeam, grillage and seafastening arrangement.
5/6
March 7th 2008
Loaded!
6/6
Time proven reliable skidding method used by the combined project teams !!
http://www.dockwise.com/files/images/080311_Maari__Project_almost_halfway_there.pdf
Milner. That's right, all big deepsea semisubmersibles cannot be moved by lifting but they move with own engines and tugs (but it is slow). Mostly jackup-rigs and shallow water semis can be moved by heavylifting, and they are the majority of drilling equipments.
Offshore rigs are not the only drilling/oil service equipment that are needed to move over the seas with heavylift vessels, also onshore rigs often are sold overseas, not to mention cranes, mining equipments etc. As DOCK said in their 2008 forecast, they are very confident with even a longer term outlook in their sector.
The new semis Seadrill has ordered are these deepsea heavy class semis, and cannot be moved by Dockwise.
Dockwise is a merger between Frontline's spinoff Sealift and the Dutch Dockwise. FRO sold its shares of Dockwise, and distributed the money as a 4Q dividend to its shareholders - like it has been done before, sometimes as shares, sometimes as money. FRO announced this selling already when the merger was announced last summer.
That does not mean that JF is out of Dockwise: he has chosen the management of Dockwise - very professionals of the sector -, and most probably owns its shares through his investment funds and holdings.
Or did you find information that JF himself has sold shares of DOCK?
I am confident about DOCK. The sector they are operating in is not so widely known (when you look at the price behaviour since IPO!), but after a couple of profitable quarterly announcements I think it will by and by become better known among investors.
Milner. Here's a link, where you can also get good (message board-) information about the shipping industry:
http://www.investorvillage.com/beta/smbd.asp?mb=6945&pt=m
Take a look e.g. at the posts "DIVI Shipping List"
ExxonMobil Inks 25-Year PSC with Petronas
by Kerry Laird
Rigzone 3/26/2008
ExxonMobil Exploration and Production Malaysia Inc. will continue working to maintain sustainable energy supplies in Malaysia for at least the next 25 years, the company announced March 26.
Petroliam Nasional Berhad (Petronas), the petroleum company of the Malaysian government, renewed its team efforts with ExxonMobil March 26 for the production-sharing operations of several offshore Malaysian oil fields.
In a statement issued by Petronas, it is declared that the combined efforts of the companies would include a $2.1 billion investment in the further development of the offshore fields.
ExxonMobil Malaysia Chairman Liam Mallon, present at the signing party, told reporters, "We are proud of the partnership and collaboration that we have with Petronas that have allowed us to deliver the energy supplies required by Malaysia in the past and now for many years to come.
"This is an exciting opportunity for the Malaysian workforce and will enable the latest technology applications, capability and collaboration to ensure efficient development of the substantial remaining resources offshore Peninsula Malaysia."
The U.S. Energy Information Administration (EIA) lists Malaysia as a "significant Southeast Asian producer of oil and natural gas," thought the agency has predicted that oil production will continue to decline over the next two years. January 2007 estimates for oil reserves cleared at 3 billion barrels, which is down from 4.6 billion barrels – a "peak" reserve estimate tabulated in 1996.
EIA has forecasted a 13% drop in 2008 oil production from 2006 levels, or 693,000 bbl/d. However, the startup construction in February 2007 of Malaysia's Sabah Oil and Gas Terminal (SOGT) indicates that "new deepwater oil and natural gas production slated to come onstream over the next several years in Sabah will be destined for export markets."
Earlier in March 2007, Punj Lloyd was awarded the Sabah Sarawak Gas Pipeline Project by Petronas Carigali, a subsidiary of Petronas. The largest pipeline project in Malaysia, the Sabah Sarawak will run 512 kilometers from the SOGT to the Petronas Liquefied Natural Gas Complex in Bintulu, Sarawak. Anticipated completion of the $500 million pipeline project is 2011. The current production-sharing contract between Petronas and ExxonMobil ends in 2012.
"The two partners have been involved in the exploration, development and production activities in the seven fields under a production-sharing contract signed in 1995, which is due to expire in March 2012," Petronas said in a statement.
For its part, the ExxonMobil subsidiary has contributed more than $15 billion over 40 years to operations in Malaysia. There are 43 platforms operated by ExxonMobil Malaysia in 17 fields. Gross production estimates for oil are 150,00 bbl/d and approximately 1.2 Bcf/d, according to ExxonMobil.
URL: http://www.rigzone.com/news/article.asp?a_id=58773