Gulf Marine Services Share Discussion Threads

[blusteradjuster] 13/5/2022 10:17

Thanks jailbird and thanks to hpcg, it was he who convinced me to finally take a position in black gold.

I'll deal with my internal ethics at a later date =O)


EDIT: with respect to financing - it makes sense to back a winner. See previous ref to virtuous circles..

[jailbird] 13/5/2022 10:15

thanks Bluster

[blusteradjuster] 13/5/2022 10:14

The equity portion of EV would continue to rise as debt falls.

Also, any risk-related discount on that EV falls away as the leverage ratio falls.

It's a virtuous circle.



-- Interest on bank borrowings reduced by 37% to US$ 17.5 million (2020: US$ 27.6 million) following refinancing of the Group's debt facility and reduction in LIBOR with both margin and average LIBOR decreasing to 3.0% and 0.2% (2020: 5.0% and 1.0%).

-- Net bank debt [3] reduced to US$ 371.2 million (2020: US$ 406.3 million). Net leverage ratio [4] reduced to 5.8 times (2020: 8.0 times).

Group anticipates net leverage ratio to be below 4.0 times by the end of 2022.

[jailbird] 13/5/2022 10:11

i think there will a fund raise later , but may require less the originally forecast

[hpcg] 13/5/2022 09:56

"Group anticipates net leverage ratio to be below 4.0 times by the end of 2022."

Ideal to be paying down debt as interest rates rise. At 88% secured utilisation they'll have pretty solid forecast for anything but an extreme event. Not much room for upside but we've already been owners for just over a third of this year. Looking ahead a year with the reported firmer rates 2023 should be much better as low rate contracts roll off. It would be nice to have a broker forecast so the PI focused apps can have some numbers for screeners. Modelling should be pretty straight forward for the house broker.

I think I would probably favour the warrant option and do it now. The alternative course of action would be the equity raise as a rights issue at the end of the autumn when there is seasonal equity market strength and a good view of 2023 to promote with. I bet that would cost a lot more though.

[catsick] 13/5/2022 08:08

Interesting that they seem to be happy not to raise the finance but to issue the warrants which are not a huge deal an fairly at the money, much better than a larger discounted placement....

[catsick] 13/5/2022 08:01

Results out all look decent , puts them on a pe of 2 and heading to a pe of 1

[baddeal] 11/5/2022 17:14

Yep it's all about ent value moving from debt to equity value so should have full year results soon which should point to improved cash generation and reduction in leverage.

[loglorry1] 08/5/2022 11:46

GMS will very likely extend their finance with banks without requiring a further equity raise or warrant exercise.

Rig rates have risen and utilisation is up which has facilitated this.

Cash generation is very strong and as debt is reduced value will flow to the equity and it will continue to rerate. 15p should be achieved soon.

[owenski] 08/5/2022 08:53

Are GMS doing another fund raise later this year?

[napoleon 14th] 07/5/2022 23:58

Hey! The less my shares move in this market, the happier I am!

At least this is in oil, right place right time, and has recovery potential...

[blueball] 05/5/2022 15:43

Taking its time to move.

[pauliewonder] 29/4/2022 09:14

Yes, free cashflow should significantly dent the debt pile and massively de-risk GMS. Once we get to that point the valuation will look hideous. Furthermore, they may start returning money to shareholders

[catsick] 29/4/2022 09:04

And all at ever increasing rates while reducing loan balance

[pauliewonder] 29/4/2022 07:39

Utilisation rates at 88% now versus 79% in February. Bodes very well for the company

[blueball] 15/3/2022 11:17

A small top up for me this am.

[pastybap] 09/3/2022 11:35

Your fault ;)

[richtea2517] 08/3/2022 20:51

A share I am pleased I held. For today at least. Think there's still generous upside here.

[trident5] 08/3/2022 19:27

That graph above is a bit misleading in that it isn't adjusted for the placing - last time it was 15p was over 3 years ago.

[jimbox1] 08/3/2022 19:18

That will do nicely.

[blueball] 08/3/2022 17:00

About 15p in the next 6 months imo.

[jimbox1] 08/3/2022 16:55

Go on then. Where is it going?

[blueball] 08/3/2022 16:31

Ask me where this is going to..?