share price chart looks set to spring up... hope springs eternal... |
More fishers urge SC: Protect our rights, let us intervene in Mercidar case
JAN 10, 2025 5:14 PM PHT
'While this is a single case, its massive consequences affect 2.3 million municipal fisherfolk,' the petitioners say
MANILA, Philippines – More municipal fishers petitioned with the Supreme Court (SC) on Friday, January 10, that they be allowed to intervene in a case that allows big business to fish within municipal waters.
The petitioners are fisherfolk from Batangas, Quezon, Zamboanga, and Cavite. The SC still needs to approve their legal standing to intervene.
Once granted, the petitioners will be part of the ongoing litigation and have the chance to express their interests and assert their rights in court.
What are the fishers reacting to? On August 19, 2024, the High Court’s First Division affirmed a 2023 ruling of the Malabon Regional Trial Court (RTC) allowing the Mercidar Fishing Corporation to fish within the 15-kilometer municipal water zone. |
 Kuwait Coast Guard modernizing fleet, introducing drones
December 26, 2024 09:47 p.m
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KUWAIT:
As part of its efforts to further secure Kuwait’s waters, the Coast Guard will soon integrate “maritime drones” into its fleet. These drones are set to begin operations during Ramadan in 2025 and will be active 24/7 for two years. Equipped with live-streaming cameras, warning systems, and tracking technology, the drones will significantly enhance the Coast Guard’s ability to monitor and safeguard Kuwait’s waters from potential security threats.
The radar system, which is expected to be fully operational within 16 months, aims to bolster efforts to protect Kuwait’s waters from illegal activities such as smuggling and unauthorized intrusions. The system will involve the construction of 12 new towers, complete with radar, cameras, communication devices, and new electronic navigation systems, marking a major advancement in the Coast Guard’s technological capabilities. Additionally, the project will include maintenance and training over the next 10 years, ensuring its long-term sustainability and effectiveness.
Something for the Saudi coastguard to be envious of! |
Sort of Extrader.
It was more progressing new projects with the PCG I was thinking. I assume that the BFAR IMEMS is finished and that no further phases will start for a long time if ever. There is no sign of progress there and many signs of the opposite. So who else might need a data centre that they would get from a marine surveillance company as opposed to a data centre specialist?
OTOH Malaysia may also be in the frame?
Answers next week. |
Ah!
I was thinking - naively/optimistically - of new countries, you were (rightly) more interested in actually progressing existing ones....;->
ATB |
Possibly the HR department is that linguistically aware.
The Filipino angle is of itself interesting and suggests that there is more to look forward to there, data centre wise. |
Malay covers 'bahasa', which would include Indonesia... but also Malaysia itself of course...and Brunei (small but wealthy, with lots of marine assets), which UK used to take care of.
IIRC
ATB |
They seem to be looking for a Senior Systems Engineer - Infrastructure and Network, which seems to be new, but might well be a repeat. It seems that they are planning on a matrix management system combining country experts and experts in particular aspects of projects for multiple deployments. No doubt much will be gleaned next week about how they intend to execute on their projects.
What struck me about this, apart from the requirement for travel 'sometimes with noticeably short notice', was that proficiency 'in other spoken languages such as Arabic, Filipino and Malay (would be) an advantage'. Interesting selection. |
Margins and profits are part of the story.I plan to be there! |
I'd rather hear on margins and profit and not more storys. |
Hopefully the CEO of Ocean Infinity will be at the AGM, in a few days time. Perhaps we will hear about O I's joint ventures in present and future system's contracts. I wonder who will be SRT's preferred aerial drone provider? Geovs is all about receiving numerous information feeds, 'slicing and dicing' and presenting alerts and response options to the control room operator. Simon likens a systems contract to Lego bricks. Countries start with a basic system and then keep adding 'bricks'. Those that can afford it will possibly want Geovs terminals on all of their boats, together with technology that has yet to hit the market. Geovs is the key for so many information feeds. |
Fascinating article in The Times about OI's search for MH370 |
Brokers note yes. Half year figures to Dec 31 2024 will come much later obviously. |
Half year figures and brokers note next week? |
Thanks LaV. Doesn't sound all that encouraging, does it - but in practice I guess we have only a binary choice, sell or hang in there. For better or worse, I'm going for the latter. I still think raising a judicious question at the AGM would be worthwhile. |
pldazzle
No doubt SRT has not the experience that their major competitors have in all this and I am sure that they (competitors) include clauses to cover cost inflation, delays etc. The only thing I have heard from SRT is that they put in a contingency in their pricing. Margins have not been as expected though, the Saudi first phase for one and the last bit of the BFAR contract which turned in a loss yet to be adequately explained.
But you must also think of the pre-contract phases which are also lengthy. In Indonesia, the contract with whom seems to have sparked your concerns, Bakamla first had to get a budget which was and is fixed at $180 million. Given that size relative to their regular budget (almost three times their annual), they must have had some convincing to do to get it. And that would surely include what they could get and why they needed it. So that specification feeds in to the $180 million. If I remember correctly, the project was in the Blue Book for a couple of years and the Green Book for a year or so before the contract was signed, so the broad parameters of what Bakamla thought it could get for $180 million were set five years or more ago and those were sold to their political masters. |
pldazzle
"there will always be a tendency for delays in implementing a contract to adversely affect the profit margins"
I agree with that. As for the rest, I don't know, so I'm not making any statements about the effect of inflation. |
The company has many posts to fill and agencies do not deliver. |
SRT seeking a Talent Acquisition Manager.
"responsible for continuously seeking out top talent, developing a compelling employment brand, and fostering positive relationships with candidates and employees." |
yump, I have no idea what your gripe is.
Here's a very general comment. Supposing (hypothetically of course) that the Indonesia contract had started in 2023, labour - to take just one illustration - would have been paid starting at 2023 rates. Leaving aside the effect of exchange rate fluctuations, which as sailing john points out can cut both ways, labour costs tend to increase over time (and in the UK, at least, employer's National Insurance rates will be 15% from next April compared with 13.8% in May 2023). Components will also tend to cost more with the passage of time (even though some will have been bought at the outset and stored). Similar considerations apply to transport, to overheads, etc etc. Other things being equal, therefore, there will always be a tendency for delays in implementing a contract to adversely affect the profit margins. And the longer the delay, the greater the scale of the problem. That's simply axiomatic. No matter how brilliant a company's contract management skills, lengthy delays in implementation will always tend to involve its swimming against the tide.
Hopefully, suitable protective clauses have been written into the Indonesia contract (also, as SJ points out, the Saudi contract, and indeed all contracts that risk being subject to long delays). To reiterate, it would be helpful if a suitable question could be asked at the AGM. For instance: "Without encroaching on confidential areas, what general comfort can ST offer to shareholders that the profit margins on major contracts, such as those originally announced in January 2022 and May 2023, are appropriately sheltered from the presumed inflationary effects of the lengthy delays in implementation". I'm sure that wording could be improved upon. |
Just to clarify.
My issue was with the “negligible profit” if no inflation priced in comment.
This thread is full of whinging and wordy guesswork which I am sick of, so I’m afraid the posting of that was a trigger, because its some sort of extreme case based on nothing much.
We simply don’t know what costs were incurred at what point in the inflationary period, so there is no conclusion worth bothering about.
I suggest anyone who seriously thinks these large contracts might have been mismanaged or written badly, just sells out.
You’ll sleep better.
Carillion went bust of course because of its tiny margins and poor contract management and provisions.
Plus we are selling to states with dodgy track records in all sorts of areas.
I don’t know how the contracts have been written, I don’t know whether a big chunk of costs were incurred early on, thereby avoiding inflation, I don’t know the margin on projects (although I think we have been told), I don’t know what employee costs and expenses were built into project prices at the start, I don’t know who is paying for product storage in the project countries, etc. but I can sleep at night because the risk vs reward seems reasonable.
There are plenty here like me who held before SRT morphed into the systems project area. That was the time the risk changed drastically and there’s been plenty of time since then to get out, if you liked widget sales rather than projects. |
Hi. Yes 25X. corrected |
"a PR ratio of 25%" - do you mean 25x? |
I believe that January 2025 is going to be the transformational month for SRT Marine, with the share price touching 100p. (Some here will laugh!) The most important feature will not be the AGM on the 23rd, although I suspect there will be a very large turnout engaging with the team, including our new NED, Oliver Plunkett. He is the CEO of Ocean Infinity which will be a 24% shareholder. The long awaited £160 million Indonesia contract should soon be up and running. However, the most important event will be the broker’s report, which will be supported by the half year figures (end December 2024). We already know a great deal about the broker’s report content, because of the £320 million of signed contracts. We can make a fair assumption about overheads. I am assuming £15 million 2025, £18 million 2026 and £20 million 2027. (the company needs to increase headcount considerably to deal with the increased workload). I am assuming that higher margin identifier sales, DAS and Nexus will grow from £12 million in 2025 to £16 million in 2027. The very big unknown, to be clarified in the broker’s note, is the average profit margin across all of the sales. Here I am assuming a 35% average margin. I believe that the company knows the strength of its offering and that 35% is about right. If we work on £300 million for sales for 2025, 2026 and 2027, I am going to pitch T/O at £80 million for 2025, £100 million for 2026 and £120 million for 2027. This deliberately underestimates T/O because it does not allow for identifier sales or future systems contracts.
Based on the above, I predict PBT for the current year at £13 million. 2026 comes in at 17 million, and 2027 delivers £22 million. If the above is achieved, SRT marine would be growing PBT, with compound annual growth rates of 30%. I believe that the market would award a PE of 25X to such a fast-growing, high-tech company which has the Warren Buffet ‘economic moat’. It also has a ‘gold standard’ international customer base, which is locked into SRT, so long as it continues to deliver on price, service and quality.
None of the above factors in the ‘bid premium’, which will be awarded when the company is taken over, and not necessarily by the 24% shareholder.
One final thought relates to systems contracts. The Kuwait contract appeared over a very short time span and others will probably provide revenue before June 2027. Is Saudi Arabia going to allow neighbouring Kuwait to have a far superior system? Let us also not forget the growing importance of fish monitoring in a world where fish stocks are declining at a rapid pace and IUU fishing is increasingly prevalent.
These are my predictions; will I be right or will I be wrong? I have given myself 24 days. Occasionally I am near the mark, but much of what I have written is already in the public domain. |
Apart from pld's very legitimate question it can also be noted that GBP-USD exchange has fluctuated between $1.09 and $1.34 in the period from Sept 2022 to the present.
The contracts can include costs in a mixture of currencies, eg groundwork (in local?), electronic components (probably usd), assembly (perhaps Euro) and design/specification (possibly GBP). One wonders how a firm price/margin can ever be arrived at.
The truth, I suspect, is that it isn't.
Given this mix plus the apparent over-optimism of SRT over time-scales (I might say naivety if I didn't wish to avoid being rude) it is not surprising that the market views SRT with strong dose of scepticism.
Very substantial companies have got into serious trouble with large contracts that turned sour. SRT's survival right since the early days when it hit a low of ~2p (I hold some bought at 2.5p) has been against the odds ... which is one of its attractions, I suppose. |
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