Otto Marine: the High Court has rejected Otto’s application for an injunction to restrain its customer, Mosvold from making calls and receiving monies on the Refund Guarantees.
Recall Otto’s order book includes 3 AHTS for Mosvold, but mkt watchers have been expecting the latter to cancel its orders due to delivery delays. Mosvold previously cancelled an earlier order for 1 AHTS and received US$23.2m in refund guarantee...
Any order cancellation and call on refund guarantee would exacerbate Otto’s cash flow situation and further stretch its balance sheet.
A number of analysts have been bearish on this counter due to the order cancellation overhang, lack of new order ytd, and poor earnings performance. Street has a wide range of ratings, with recent TP btwn $0.19- 0.42.