Thread by @AllVentured

New $ATCO press release out today reveals that they are achieving more than 90% financing on their newbuilds and that since their conference call early May they have signed forward contracts for nearly 30 ships that had contracts expiring in 2021 and 2022. prnewswire.com/news-releases/…

Although the corresponding 6k filed today is cryptic and doesn't provide the terms of the new charters for the 30 ships mentioned, the CEO mentioned on the call in early May that they were looking at $27k for 5 years on panamax which has only increased meaningfully since then.

The 6k reveals that exactly 15 of these 2021 and 2022 charter rolls were negotiated in June and we can deduce from the commentary on the conference call that another 10-15 were negotiated after the conference call in May.

This is in addition to the many charter rolls negotiated earlier in the year which commenced their new much higher rate charters in Q1 and Q2. From Q3-2022 end, these 30 additional ships will roll onto much higher rate contracts that are already signed.

In 2023 the newbuilds start to deliver in earnest guaranteeing $270M of incremental revenue in 2023 ramping to $560M of incremental revenue in 2024

Between the upcoming charter rolls already contracted at much higher rates and the massive newbuild orderbook, we can be assured that every single quarter through early 2024 will see higher revenues and (unusuals aside) higher earnings than the quarter before it.

With the cash they are printing with their existing fleet rolled onto todays sky high rates and the 90+% financing they are achieving on their newbuilds, it is looking increasingly likely that they will be able to fund this breakneck growth without issuing new equity

$ATCO still trades below its pre-covid 2019 high. Rates however are now more than 3x their 2019 levels and $ATCO has since baked-in an additional 50% revenue growth via newbuilds and massively increased its contract backlog. I believe $ATCO to be very cheap here.