Upload
logan-wright
View
230
Download
0
Tags:
Embed Size (px)
Citation preview
Knightsbridge Tankers Limited
Company Background
• Knightsbridge Tankers Limited is an international tanker company with the primary business activity of international seaborne transportation of crude oil.
• Knightsbridge is wholly owned subsidiary of Frontline Ltd., and has 4 VLCC or very large crude carriers
ShipsVessel Name Type Employment Expiration Date Terms
Camden VLCC Time Charter March 2009 $37,750/day
Mayfair VLCC Time Charter March 2010 $37,750/day
Hampstead VLCC Time Charter May 2012 $31,000/day
Kensington VLCC Time Charter May 2011 $45,000 /day
Statement of Cash Flows
Balance Sheet
AnalysisVLCCF NAT TK Industry
P/E 4.94 7.11 5.82 7.97
ROE 21.67% 16.27% 6.98% 25.09%
ROA 14.26% 14.69% 1.79% 3.99%
ROI 15.83% 14.97% 2.04% 9.98%
Operating Profit Margin
59.24% 53.20% 16.74% 36.15%
Stock Price
Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-090
5
10
15
20
25
30
35
VLCCF vs. S&P 500
Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09-20
-10
0
10
20
30
40
50
Strengths
• Relatively new ships. Older ships have to be phased out over the next few years, which Knightsbridge could take advantage of because they have no old ships.
• Expanding into dry bulk shipping with the purchase of 2 ships underconstruction
• Locked in charter rates for its two under construction vessels, which limiting its exposure to declining charter rates.
• Potentially limited risk in credit markets because of their large amount of cash on hand. If needed Knightsbridge could use cash instead of debt for financing.
• Have historically paid a consistent and high dividend, yielding approximately 10% over the past 3 years.
Weaknesses
• Expiring Charter on one ship• Mainly use charters as oppose trading on the
spot market• Possibility of charter cancellation• If the 2 vessels are not delivered within the
deadline set by the charter, the charterer will have the right to cancel the charter.
• Four customers accounted for 92% of gross revenue in 2007
Opportunities• Increase in oil demand leads
to increase in demand for oil transportation
• Route expansion into other areas of the world
Threats• Increase in government
regulation• Continued weakness in oil
demand
Questions