Otto Marine

Wow a drillship that meets Nowegian standard and worldwide operation. This is really very interesting development.

Why then no owner approach Otto to build 1? So far only SM is building for owner, not even Kep.

Looks like moving up the value chain, bear watching.

http://www.businesstimes.com.sg/premium/...s-20140827


PUBLISHED AUGUST 27, 2014
Otto Marine bags A$57m contracts

Charter deals are for 2 of its deep-water anchor handlers
BYMALMINDERJIT SINGH
msingh@sph.com.sg @MalminderjitBT

Mr Stanley: 'We continue to divest from our smaller tonnage whilst focusing on deep-water anchor handlers, platform supply vessels and inspection, maintenance and repair vessels around the world.' - ST FILE PHOTO
MAINBOARD-listed Otto Marine has secured A$57 million (S$66.3 million) worth of contracts with oil majors.
Otto revealed that the time charter contracts with the two oil global oil companies are for its deep-water anchor handlers Go Sirius and Go Spica.
Employed in drilling and pre-lay support, Go Spica will be mobilised to Australia for a long-term charter off its north-west coast this month, and will be operated by the group's wholly owned Australian subsidiary Go Marine.
The Go Sirius vessel, which has been working in Australia for the past two years, has secured work out of Darwin in support of another oil major.

Otto is recovering from its darkest day in 2013. I attended its AGM, its venture in Mid East failed, business not doing well, need a cash call. Over the past year, Otto is doing good on its recovery, hope it will see better days

Otto Q3 profit halved on lower one-time gains
By
Nisha Ramchandaninishar@sph.com.sg@Nisha_BT
15 Nov5:50 AM
Singapore

OFFSHORE marine firm Otto Marine's net profit was about halved from US$4.12 million to US$2.02 million for the third quarter ended Sept 30 as one-time gains saw a sharp drop.

This was despite revenue rising 16.8 per cent to US$96.82 million. Earnings per share worked out

http://seashipnews.com/News/Otto-Marine-...c3008.html

Quote:Singapore: Mok Kim Whang, president of the shipbuilding and fabrication division of Otto Marine, has been charged with corruption for alleged bribery while working at a former company.
Mok received one charge in the State Courts of Singapore under the provisions of the Prevention of Corruption Act.
The alleged offences date back to 2004. Mok was senior vice-president of Tuas Yard at Singapore Technologies Marine from June 2000 to July 2004. Further investigations are ongoing.
He is among three former employees of Singapore Technologies Marine that are alleged to have given bribes in return for favours such as ship repair contracts, as SeaShip News reported yesterday.
Otto Marine has not been contacted by the Corrupt Practices Investigation Bureau (CPIB) to assist on any such investigations, the group said today in a statement.
“Pending the outcome of the court proceedings, Mok remains employed by the company. The company will consult its lawyers and consider its next steps with regards to the employment status of Mok after the verdict at the end of the trial,” Otto Marine said.
Before joining Otto Marine in March last year, Mok was employed by Keppel Philippines.
Singapore-listed Otto Marine does not expect his charge to have any effect on its assets or earnings. [12/12/14]

http://businesstimes.com.sg/companies-ma...for-us100m

Otto Marine sells vessel for US$100m
By
Angela Tanangelat@sph.com.sg
29 Dec8:24 AM
OFFSHORE chartering group, Otto Marine Limited, said on Monday that its shipyard division has sold an Anchor Handling Tug Supply Vessel (AHTS) to a unrelated third party for US$100 million...

Profit warning from the company. Is this the first among O&M companies?

(not vested)

--------
The Company wishes to issue a profit warning regarding the financial results of the Company and
its subsidiaries (the “Group”) for the financial year ended 31 December 2014.  
The Group is expected to report a loss for the financial year ended 31 December 2014 largely due
to, amongst others, the following:
I. Cost overrun for the construction of a vessel;
II. Low utilization and delayed charter commencement for vessels in the offshore chartering
segment;
...
http://infopub.sgx.com/FileOpen/Profit_W...eID=334438

(10-02-2015, 09:56 PM)CityFarmer Wrote: Profit warning from the company. Is this the first among O&M companies?

(not vested)

--------
The Company wishes to issue a profit warning regarding the financial results of the Company and
its subsidiaries (the “Group”) for the financial year ended 31 December 2014.  
The Group is expected to report a loss for the financial year ended 31 December 2014 largely due
to, amongst others, the following:
I. Cost overrun for the construction of a vessel;
II. Low utilization and delayed charter commencement for vessels in the offshore chartering
segment;
...
http://infopub.sgx.com/FileOpen/Profit_W...eID=334438

Otto Marine chartering vessels Fleet consist of towing tugs,Flat Top Barge,AHTS,WMV,MPSV respectively.

Link:
http://www.ottomarine.com/fleet.html

A sad case for Otto Marine because one year earlier in Feb 2014 it reported a profit of US$15.9 million for FY2013 which was a rebound from US$113.7million loss in FY2012.

LinkFY2013 results from one year ago)
http://infopub.sgx.com/Apps?A=COW_CorpAn...NoUaNJHKSo

http://infopub.sgx.com/FileOpen/Otto%20M...eID=342221


Looking at Otto Marine's FY14 results and financial position, it looks horrible.

Noted significantly lower revenue generated from shipbuilding for FY14 as compared to prior years. Wonder if Otto Marine is actively pursuing potential shipbuilding orders which was once the core business or have it neglected its core past and focus on its newfound love in chartering and more recently, subsea services.

Noted management wanted to expand its subsea segment which contributed 8.7% of FY14 revenue and engaged UOB Kay Hian as advisors. Wonder if there are any concrete and feasible plans and also opportunities out there in the subsea sector for the Otto Marine to pursue as this is a new area for Otto Marine and there will bound to be a learning curve and the group doesn't have redundant financial resources to spare at current situation.

The group is highly leveraged with debt to equity ratio at 2.07 times and cash resources are low and required for working capital.

In view of the group's current financial position and areas which the management wants to pursue, it seems that new capital needs to be raised. With the high leverage currently, capital raising via equity seems the only feasible avenue. Also, for ambitious plan to further develop subsea services as envisioned by the management, think that needs a lot of resources, if there should be any equity fund raising, this will be a huge one. Get ready for cash call.


For FY14 vs FY13
Revenue - down 31%
COS - down 28%
GP - down 56%
GPM @ 5.8%

GP @ US$20.661m

Finance costs for FY14 @ US$27.886m which is damn high due to super high leverage already wipe out all profits, not even taking into account admin, selling & other expenses.

Otto is also a remarkable cash burner.
Cash for FY14 decreased US$28.763m
Cash for FY13 would have decreased US$49.069m, should there be no rights issue which raised US$49.61m nett.

Good thing is, Mr Yaw director and also major shareholder finances Otto with US$30m made in the year through himself direct and his vehicle.


I honestly think there is an issue on the going concern of Otto Marine given the facts as above, quite amazed that its auditors Deloitte gave an unqualified opinion and even without an emphasis of matters paragraph. I think Deloitte are satisfied there is no such issue probably due to the following possibilities:-

1. Disposal of a number of vessels for cash

2. Capital to be raised in probable future (debt or equity)

In any cases, think it will take a very long time for Otto to get back into shape.


Just curious, also noted Otto Marine did not have capitalises drydocking costs. Considering there is approximately 59 vessels, there should be huge financial impacts. I can't find any such disclosure in Note 2 - Accounting policies & Note 14 - PPE

Vessels are required to be drydocked at certain period intervals as per international maritime regulations and noted companies owning vessels will capitalised the drydock expenses when incurred and amortise on a straight line basis over the period to the next drydocking date. However, there were no disclosures of such in Otto Marine's accounting policy. Perhaps, my eyes played tricks on me.

The axe is falling....

http://infopub.sgx.com/Apps?A=COW_CorpAn...cation.pdf

WINDING UP APPLICATION
Otto Marine Limited (the “Company”) wishes to announce that a creditor of the Company (the “Creditor”) has filed a winding up application with the Singapore High Court (the “Court”) to wind up the Company (the “Application”). The Court has made directions for the Application to be heard on 15 May 2015. The total sum claimed against the Company pursuant to the Application is approximately USD 200,000 and EUR 900,000 (the “Debt”).
The Company is not disputing the Debt. The Company is currently in negotiations with the Creditor’s solicitors to reach a settlement in respect of the Debt.
The Company has taken all reasonable care to ensure that the facts stated in this announcement are fair and accurate in all material aspects as at the date hereof and that no material facts have been omitted from this announcement.
The event is not expected to have a material impact on the financials of the Company for the financial year ending 31 December 2015.
Submitted by
Chong Sieh Jiuan
Chief Financial Officer and Joint Company Secretary
25 April 2015