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Good morning Mike, will certainly be interesting to see the figures. Companies similar to Taylors in the USA, admittedly larger, have recently reported much better figures. Given this and the fact that economies of scale should really starting to come through, I am a tad more optimistic, but time will tell. On a different note, shipping webpages are full of articles about the benefits of fuel improvement / efficiency technology. This is something that Taylors have been involved in from the start so will be equally interesting to see how this develops.
Thanks Sam and Mike, sage thoughts as always. This morning SP up over 4% but only 4 shares bought with no sells, weird?
240k sales would spook the market.Not sure of any real reason, other than the world markets being jittery , factually there were 7 trades around midday, values at £10,000 each, which suggests it was London based and which set the jittery tone.
Brace yourselves for Q3 results which will be worse that the previous 2 quarters but remain steadfast that Q4 will be considerably better.
BHSI still up YTD and BDI near a 12 month high!
As said before, this business is incredibly cyclical so ride the current wave up (no pun intended).
The only thing I can think of is ceo is having to sell sone as part of divorce. Similar companies have recently reported with much better results and beating index but not by as much as Taylor’s has consistently done /. I am therefore confident q3 results will be very positive . Very annoying though . Perhaps an rns tomorrow which could shed some light
What’s spooked the market today guys? There are a handful of buys but 240000+ sold. I can’t find any news anywhere.
Well, I had to add. Not just because of the last 2 RNS, but because I had it planned anyway.
Now this is one of my biggest holdings. And at a difference with other companies with boards and "appointed managers" it looks to me that the interest of the CEO and the stakeholders is very aligned.
I could not agree more and equally thank you all. In looking at the debt at the time of the acquisition it has now been reduced by a whopping 43 percent. Certainly timing of disposals as Mike says seems to have been timed incredibly well. Interesting comments re Singapore Mike. It will be interesting to see how they play it in the medium/long term. Indexes very slightly down today but hopefully just pausing for breath after the big rises. I feel Octobers figures should be very interesting.
This is the most informative, helpful and polite chat of all in LSE. Thank you
Krusty/Sam, likewise it is good that TMI has addressed many of the points we have recently brought up. Particularly that fine balance of paying down debt or not selling vessels. Conservative debt management has clearly allowed them to renegotiate the RCF at a reduced margin, although with the current overnight SOFR rate at 5.31% I still expect they are paying nearly 7% interest on this new debt replacement and should allow them to gently ease the vessel disposals. It is clever management that can sell vessels just as vessel prices have started to fall and can then hold and possibly start to rebuy just as vessel prices start to increase again.
Sam, I see Grindrod being registered in Singapore as a posItive rather than a negative. International shipping tax legislation is complex but Singapore has very liberal tax regulations compared to UK and particularly USA (check out the percentage of pretax profit they pay as tax). And I believe the bigger saving would be if Grindrod could delist from the stock markets in US/S Africa and still remain registered in Singapore.
BHSI today closed at the same price as yesterday but hopefully this is a blip and not the end of the recent phenomenal increase!
Indeed, nice to see more positive news flowing out of TMI now. With the big Grind divi and proceeds from the sale of the commercial & technical businesses, together with improved charter rates, there should be scope to reduce the debt further without having to sell further vessels (hopefully...).
Thanks guys, interesting thread. I imagine TMI really regret not having been able to acquire the 90% of Grind to fully take them out, but it's no more than a side-issue now as things progress. Agree there are more important priorities, chiefly running down the debt whilst retaining as many vessels in the combined fleet as possible.
Really pleased with the RNS. In a difficult market in the first six months to get the debt down so quickly is excellent news. I think we are now likely to see a slowing if not a stop to the older ship sales.
TMI offered to buy all Grindrod shares late last year and needed a minimum 90% acceptance to compulsory buy the total,but only managed to buy 83.23%, 33 institutions now own 1.35% (Barclays is the biggest at 0.49%,) the balance is presumably individuals (the biggest is Ed Buttery who owns 0.10%).
There will be continuing costs incurred with Grindrod listed on Nasdaq and JSE South Africa but at the moment TMI seems happy to let that continue. I suppose at the moment they control 100% of Grindrod and wish to run down their own debt before considering to buy more Grindrod shares on the open market or consider a delisting.
Krusty, I agree there could be say $11m worth of new Grindrod shares in circulation within 2 years although on an arms length basis and possibly at a premium so it is not particularly indirectly dilutive to TMI. Anyhow both TMI/Grindrod would have to be legally very careful to avoid breaching transfer pricing regulations in both US/UK.
Hi Krusty, I don't KNOW either but the challenge is that Grindrod is registered in Singapore, not USA, and delisting there is VERY difficult.
Shareholders who did not accept the Taylors offer sill hold there shares. Under Singapore law it is very challenging to delist a company even if you own 83 per cent of the shares and have appointed a majority of directors to the board. 83 percent of profits of course go to Taylors.
It won't be dilutive for TMI but ultimately there will be more Grind shares in circulation. I did wonder if this might be to effectively reduce the % shareholding of those remaining Grind holders who have not accepted the TMI offer? Is there any significance if their total holding were to fall below 15% for instance? I'm afraid I don't know enough about US company law to know the answer.
I actually thought that TMI owned Grindrod fully… and that it would end up merging fully benefiting from economies of scale. Who owns the other 17% of GR? Any other major shareholder?
Hi Mike, many thanks. I also thought it would be the other way around. I do wonder the long term implications as I always thought Grindrod would be eventually subsumed into Taylors. It would make sense though to put the functions in the place to get the best results so clearly the company view is that it is Grindrod. Share price very slowly strengthening and indexes still going up day by day. Long may that continue. Gardening this afternoon then checking indexes and prices later ! Have a great day. Sam
Hi Sam, like you I was a little surprised but I take it at face value that it is just continued integration. Somewhat surprised that it is Grindrod doing the acquiring rather than the other way round but Grindrod does have the bigger fleet and it is only the commercial and technical managing parts of the business rather than the vessels themselves or the bigger company. So it is not an inverted takeover by Grindrod and the total $11.75 m value represents only around 3% of the total TMI NAV and so at the agreed prices should not be particularly dilutive for TMI shareholders.
At the end of the day Taylor Maritime Investments Ltd still owns 83%+ of Grindrod Shipping and we have both said in the past that we wants greater integration between the two businesses (hopefully eventually becoming one business).
Good morning Mike, was a little surprised to see the contents of this mornings rns if honest. What is your take on it ?
The further debt reduction indicated by the CEO will probably follow after the cash distribution from Grindrod Shipping on 30th October when TMI will receive around $37 million (but no further Grindrod dividend this year and I suppose it does help to dilute the minority value in Grindrod).
BHSI closed up 1.53% at 662 today, a new high for this year to date. Still lagging behind the BDI which was up 3.8% today or over 10% YTD.
GoOod to see no red/sells today!
It would appear that the articles are only available to subscribers to the site. Beyond my means!
Unfortunately it's behind a paywall:
https://www.tradewindsnews.com/bulkers/-no-skeletons-tmi-s-ed-buttery-and-carl-ackerley-press-on-with-grindrod-integration/2-1-1520750
Hi, regret I had it emailed to me and way beyond my abilities to add. The site is tradewindsnews.com. Interestingly another article has appeared there with the CEO where he indicates debt reduction should be improved in the next quarterly results over the last so fingers crossed. Apologies again
Hi Sam, would you give me a link for tradewinds please? Have tried to search but not the right results.