Mercantile Ports & Logis... Share Discussion Threads

[saikat] 26/8/2017 05:56

Lot of excitement! I hope all of you exit successfully. Junkest of the junk - marketmakers occasionally will try to ride a news and ease their losses - everybody knows that this a pure scam.

[keith95] 25/8/2017 20:27

I think the sign of a "Loser" roydyor is someone wasting their time on a share that they sold at a loss quite some time ago ... wanting to blame everyone else but themselves, and not being able to move on.

I hope this share makes it ... so that certain people get to look beyond really stupid.

[mount teide] 25/8/2017 16:52

roydor - just stating facts, however unpalatable.

No port operator would have invested in MPL at the IPO price of 250p.

We invested after the price had fallen 80% because, if professionally managed, the project had compelling risk/reward. Once the management were repeatedly exposed as liars and the cash burn completely implausible we sold.



'MPL was chosen due to the large amount that has already been invested and the chance of the project coming into profit next year.'

There is ZERO chance of this project ever producing a profit capable of paying the interest on the debt, never mind any capital repayment which from the end of next year total a combined £12.6m a year for the following 4 years!

The Port of Dover, Europe's largest short sea port's last reported profit was circa £3m from memory.

AIMHO/DYOR

[roydyor] 25/8/2017 16:26

No need to get all worked up just because you have got someone arguing with you. That is normally the sign of a loser. If you have lost 96% of your investment then I feel for you and can partly understand the rudeness. I usually invest in FTSE 350 companies but just for fun I invested in three Aim companies, VOG, AAU and MPL, at the end of last year. Only VOG is in profit. MPL was chosen due to the large amount that has already been invested and the chance of the project coming into profit next year. Small punt at 11p.

[mount teide] 25/8/2017 16:05

Clever - lol

Its probably safe to assume you weren't invested during the 97% destruction of shareholder value this 'clever bunch' has generated since IPO, culminating in an emergency £37m cash raise at a 96% discount to the IPO price!

Clueless, totally clueless!

[roydyor] 25/8/2017 15:45

Shows what a clever bunch we have got in charge. lol
Roll on 20p

[mount teide] 25/8/2017 15:41

roydyor - would have greatly enjoyed having 'well' heeled prospective customers like you at the port terminals i ran!

There are small ports in Scotland that handle wellhead decommissioning business - they could only dream of getting those revenues figures per tonne, and have at least 250% higher stevedoring employment costs.

AIMHO/DYOR

[roydyor] 25/8/2017 15:25

The charge is probably for handling and allowing the decommissioning of well heads on site. This could be the reason for the extra cost.
TW and Shareprophets are very quiet about the news, considering they were keen when the news seemed bad.

[mount teide] 25/8/2017 15:19

The European Ports Industry, Indira Harbour Terminals and JNPT Container Terminal would i'm sure be fascinated to know what cargo can generate £4.70 a tonne revenue through a small heavily draft constrained bulk cargo and barge terminal.

Currently at the JNPT terminals a coastal trade 3,500 dwt bulk carrier generates the following revenue:

Ships Dues circa £150 = £0.05/tonne
Cargo Dues of £0.25/t = £875 for dry bulk, £0.75/t = £2,600 for steel coils
Storage/handling to road vehicle = £0.20/t

Suggesting the following revenue: £0.05 + £0.25 + £0.20 = £0.5/t = £1,750 per ship for dry bulk, and £1.00/t for vessels carrying steel coils.

Where do MPL get their £4.70/tonne revenue figure from per 1.0m tonnes handled?

At JNPT even the highest paying containerised cargo, inclusive of ships dues, cargo dues, storage and handling to road/rail only generates between £2/t and £2.50/t per teu (assuming 20t of cargo).


AIOHO/DYOR

[roydyor] 25/8/2017 15:12

The chairman of the maritime board seems happy to join in. :)

"With the Facility expected to be operational during December this year, MPL is extremely honoured that the Chief Minister of Maharashtra, the Honorable Shri. Devendra Fadnavis, who is also the Chairman of the Maharashtra Maritime Board, has accepted the Company's invitation to be the Company's Chief Guest at the Official Opening Ceremony for the Facility. The ceremony is expected to take place before early January 2018 and a further update will be made once the specific date, convenient to a number of key attendees, has been coordinated and confirmed."

[roydyor] 25/8/2017 15:04

If this agreement is for decommissioning well heads, as per the March 27th memorandum of understanding statement, then the road will not be quite as important as that for normal bulk traffic. The remains could even be transported to another customer by using the port facilities. This could also be the reason for the higher than usual charge.


"(ShareCast News) - Mercantile Ports & Logistics is to develop a facility at its port in Mumbai, India with an engineering and logistics project company.
The AIM-listed company and its subsidiary, Karanja Terminal, has entered into a memorandum of understanding for 200 metres of the quay length of its port to be used for handling cargo for the decommissioning of wellhead platforms for the gas industry.
The deal also includes plans to develop a yard area to be ready in time for the start of operations at the port.
The terms relating to the use of the facility are still to be agreed between the companies, which will be finalised within 60 days from signing of the memorandum of understanding."

[mount teide] 25/8/2017 13:01

The intention to brazenly commence limited operations at Karanja without complying with, or while being in breach of important contractural requirements of the Port Operating Concession is totally astonishing, particulate since it has been previously brought to the attention of the management and Nomad on a number of occasions by various concerned shareholders:


'Acquisition of land for the road linking the Multi-purpose Terminal to the nearest major access road'

'The Deed of Lease requires the Company to develop and build the approach road to the Multi-purpose Terminal from the nearest major access road. The Group will be reliant on the co-operation of the Public Works Department of the State of Government of Maharashtra for the approval of the construction of the road and possibly to share the costs of the construction and adoption of the road. Any failure by the Group to acquire the relevant land and build the relevant infrastructure on it may result in the termination of the Deed of Lease, which will have a material adverse effect on the Group’s business, financial condition and results of operations.'

Failure to confirm MPL have bought the land, obtained planning permission and built a new access road linking the terminal to the federal highway some two miles away. Surely MPL management is not going to attempt to commence operations using a heavily potholed, one lane dirt track that is largely unusable during the 4-6 month monsoon season for safety reasons, since some sections of it get washed away into the adjacent flood plain and mangrove swamp. Why do you think MPL failed to carry out any land reclamation work during the last three monsoon seasons?

How can the company expect to safely commence vessel operations by year end, if there is no new road to provide a safe, reliable, all weather access for third party Heavy Goods Vehicles, as required under the terms and conditions of the Operating Concession?

Mercantile has blatantly failed to update the Market during the last 7 years as to:

How the acquisition of the Land is progressing?
What co-operation Mercantile is receiving from the Public Works Dept(PWD)?
How the Approval Process for the Construction of the new road is progressing?
When the Market can expect to see Plans and a timetable for construction of the road?
How much of the Cost of the Road Mercantile has been able to get the PWD to agree to pay?
How discussions with the PWD are progressing, with regard to the Adoption of the new road?

Just months away from the commencement of limited operations at Karanja, how comfortable is the Maharashtra Maritime Board(MMB) with this situation, because many shareholders are anything but comfortable!

In the IPO Document, the Company & Nomad kindly highlighted that a failure to execute this requirement to the satisfaction of the MMB MAY RESULT IN THE TERMINATION OF THE DEED OF LEASE AND THE LOSS OF ALL SHAREHOLDER VALUE. Since we are yet to find any evidence in Company Statements that any progress has been made in this connection, the Company/Nomad needs to urgently confirm by way of Company RNS the current situation and, what the NOMAD and NED's have been doing during the last 7 years to protect shareholder's investment interests with regard to compliance with this issue. Yes, i know the share price is 97% down since IPO and shareholders have only 3% left of their investment to protect, but there is a matter of principle here.



Reliance on SKIL as the promoter of the Karanja Project:

'It is a condition of the Deed of Lease that SKIL, KIPL and their respective promoters and affiliates retain a minimum 26%, directly or indirectly, in the Project (the ‘‘Minimum Threshold’R17;). If that interest is not maintained the MMB may seek to terminate the Deed of Lease, which would have a material adverse effect on the Group’s business, financial condition and results of operations, as well as acting as a potential deterrent to potential acquirers of the Company.'

'The Board believes it is unlikely that the Minimum Threshold will be breached in the foreseeable future. In the event that a transaction was proposed in the future that would be likely to cause a breach of the Minimum Threshold, the Board would have to determine whether or not to proceed with such a transaction, taking into account all of the circumstances at that time. The Board believes that it may be possible to reach agreement with the MMB in the future with respect to reducing or eliminating the Minimum Threshold ONCE THE PROJECT HAS BEEN DEVELOPED AND IS OPERATIONAL, ALTHOUGH THERE CAN BE NO ASSURANCE THAT ANY SUCH AGREEMENT WILL BE REACHED'

It is simply extraordinary that some 10 months after completely overlooking its importance in the production of the Shareholders Circular to raise £37m in October 2016, for which Cenkos were extremely well remunerated, shareholders are still yet to see an appropriate response from the Nomad/Company, in line with their duties and responsibilities with respect to the UK Corporate Governance Code and AIM Rules for Nominated Advisors.


Since the company and NOMAD HAS FAILED IN ITS DUTIES to ensure the Company operates within the terms and conditions of the Port Operating Concession, and has failed to respond to reasonable requests from shareholders asking for clarification of this important matter, regrettably today, we have written to the Maharashtra Maritime Board(MMB) as concerned shareholders to ask for clarification.

AIOHO/DYOR

[mount teide] 25/8/2017 11:08

Finally some communications but still no updated site photographs - as always MPL RNS's raise far more questions than answers!

Some initial thoughts on the most important part of the statement:


'In the first year, MPL has contracted to handle two million tonnes of cargo (with a guaranteed minimum of 750,000 tonnes). In year two, this will increase to two and a half million tonnes (with a guaranteed minimum of one million tonnes), and to three million tonnes in year three (with a guaranteed minimum of two million tonnes). Under the terms of the contract, and at today's exchange rate, MPL EXPECTS to generate revenue of approximately GBP 4.7million for every one million tonnes handled, with a built-in escalation of 7 per cent per annum.'


I would suggest shareholders examine the above statement very closely and then study the Mumbai Harbour and JNPT Stevedoring and Wharfage Rates for handling Dry and Break Bulk Cargo.




Concentrate on these aspects of the 'Contract' which is with an unnamed client and an undefined cargo type:

Year 1 - a guaranteed minimum of 0.75m Tonnes (£3.5m revenue)
Year 2 - a guaranteed minimum of 1.00m Tonnes (£4.7m revenue)
Year 3 - a guaranteed minimum of 2.00m Tonnes (£9.4m revenue)

A REVENUE of £4.70 per tonne - (stevedoring/wharfage/storage)

The guaranteed minimum is a very low 37.5% to 40% of the 'contracted' tonnage in the first two years of operation.


And then consider this:

Cargo Handling costs are around 50% of revenue for a modern bulk/break bulk port.

The current INTEREST payment on the debt is currently running at £6.3m a year with loan capital repayments of a similar size kicking in during year two of the 'contract'.

The fact that the average stevedoring and wharfage rate combined for handling bulk and break bulk cargo is around £1.20 per tonne(75% less) at the Indira Harbour Terminals according to the latest schedule of charges. The £4.70/tonne total revenue figure makes NO SENSE WHATSOEVER UNLESS THEY ARE HANDLING GOLD BULLION!


AIOHO/DYOR

An excellent opportunity for any who brought in at or close to the placing price to exit.

No investment advice offered, inferred or intended.

[my retirement fund] 25/8/2017 11:05

deepvalueinvestor you should be taking advantage of the short term liquidity generated this morning to exit you massive holding. I appreciate you will be sitting on a giant paper loss but surely its sometimes better to get something back rather than nothing at all longer term?

[deepvalueinvestor] 25/8/2017 10:06

Finally some good news. Rather annoyed I didn't have funds to add at the lows. Long term hold. Back to sleep...

[love it] 25/8/2017 10:02

Took my profit lost my nerve bought in at 6p though so did ok.

[love it] 25/8/2017 09:48

Do you really think somebody could sell 400k at 9p when high was 9.25-9.5p it will be a delayed buy or short closing.

[pre] 25/8/2017 09:45

400k sell at 9p...looks like its turning

[phowdo] 25/8/2017 09:44

If this truly is a turning point the directors would be filling their boots.

[azalea] 25/8/2017 09:43

Or more unfounded accusations of lies and corruption?

[pj 1] 25/8/2017 09:37

Or more Lies and corruption?

[azalea] 25/8/2017 09:33

Will today's news put an end to all the finger pointing of a corrupt BoD?

[orinocor] 25/8/2017 09:23

Isn't it about 4-5 million in annual interest payments required?

[someuwin] 25/8/2017 09:23

Excellent share price action.