Hi All Been a long time lurker and thought I should put my...

Hi All

Been a long time lurker and thought I should put my 2cents in to the MRM discussion now that I've invested in the company.

I see MRM as being quite cheap in comparison to it's competitors. Below is a list a few OSV companies.
ALAM - Operates mainly in Malaysia
ICON - Operates mainly in Malaysia
TDW - International
GLF - Mainly Gulf of Mexico and North Sea
CKH - Mainly Gulf of Mexico - this is quite a diversified marine services company
Subsea 7 - Put this in there since they can be a good indicator future subsea work

	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6	Column 7	Column 8
0	.	MRM	ALAM	ICON	TDW	GLF	CKH	Subsea 7
1	Share Price	0.64	0.69	0.59	28.44	15.28	73.72	11.1
2	3-month return	-32.61%	-7.89%	-22.37%	-10.62%	-23.29%	0.07%	16.35%
3	Market Cap ($m)	231	?	?	1,330	392	1,350	3,690
4	PE Ratio (Trailing)	3.21	9.14	10.06	Loss	9.92	31.04	NA
5	PB Ratio	0.32	0.9	0.92	0.53	0.4	0.96	0.66
6	Utilisation	60%	73%	78.20%	83%	70%	68%	NA

As you can see from the above MRM has suffered the most with a sharp decline in SP and the lowest PB ratio. I haven't dug of liquidity figures but we know MRM has a decent balance sheet.

Utilisation at 60% is quite low but yet MRM has been able to turn profits over which indicates they prefer to stack vessels rather than lower day rates. However, it's competitors in SEA are achieving much higher utilisation which is worrying. I've read that Petronas (state owned Malaysian oil company) generally prefers to give work to Malaysian OSV companies - which is also of concern for Jaya. One thing to note is that ICON's CEO and COO were reprimanded and placed on 6 months of absence to assist with corruption investigations - this is the main reason for it's sharper decline in it's SP over the last 3 months.

MRM operates in the shallow to mid-depth oil market and has no exposure to deep water which means they operate in environment with lower break-even price. Gulf of Mexico and North Sea markets seem to be hardest hit by the fall in oil prices. Australia in general has a high break-even point for oil and gas due to it's high labour costs - so I'd expect exploration work to dry up but construction work to continue on although at lower day rates due to increased competition.

MRM is still quite a risky investment since there is a lot of uncertainty about future Australian work once construction of the 4 major projects wind down. There hasn't been an announcement of MRM winning a major tender since the INPEX PSV contract, where as I've read of other OSV companies succeeding in Australia.

Is it a takeover target? No I doubt it, in a highly saturated market last thing OSV companies would want to do is stack more vessels.
Will there be asset write downs? Yes probably, since the fact that they haven't been able to sell vessels as planned indicates the lack of demand.
Does it warrant a PB of 0.32? No, especially when it's competitors are trading at a much higher ratio.

Overall, I see value in MRM in comparison to it's peers and feel there is a far larger up side potential than down.

I'm hoping the above info is correct - please correct me if I'm wrong.