Atlas Q2 guidance

[Candyman1]

Guidance:

The following table* is based on Atlas' current expectations for the years ending December 31, 2021, 2022, 2023 and 2024.

					Revised
Guidance Metrics (in millions of US dollars)	2020 Actual				2021 Guidance(1)(2)			2022 Guidance(2)			2023 Guidance(2)			2024 Guidance(2)
Revenue(3)	$	1,421.0			$	1,585.0		$	1,745.0		$	1,920.0		$	2,215.0
Operating expense		275.0				339.0			380.0			430.0			510.0
G&A expense		65.0				97.0			99.0			102.0			106.0
Operating lease expense(4)		151.0				156.0			155.0			125.0			115.0
Adjusted EBITDA(5)		924.0				993.0			1,111.0			1,263.0			1,484.0
Adjusted Net Earnings(6)		311.0				440.0			535.0			605.0			695.0
Interest expense(4)		192.0				205.0			210.0			250.0			350.0

[Candyman1]

Market cap currently is 3.5 billion for earnings guidance in 2024 of $695.

[petec]

And cumulative earnings over the next 4 years of nearly $2.3bn.

[glider3834]

23 hours ago, Candyman1 said:

Guidance:

The following table* is based on Atlas' current expectations for the years ending December 31, 2021, 2022, 2023 and 2024.

					Revised
Guidance Metrics (in millions of US dollars)	2020 Actual				2021 Guidance(1)(2)			2022 Guidance(2)			2023 Guidance(2)			2024 Guidance(2)
Revenue(3)	$	1,421.0			$	1,585.0		$	1,745.0		$	1,920.0		$	2,215.0
Operating expense		275.0				339.0			380.0			430.0			510.0
G&A expense		65.0				97.0			99.0			102.0			106.0
Operating lease expense(4)		151.0				156.0			155.0			125.0			115.0
Adjusted EBITDA(5)		924.0				993.0			1,111.0			1,263.0			1,484.0
Adjusted Net Earnings(6)		311.0				440.0			535.0			605.0			695.0
Interest expense(4)		192.0				205.0			210.0			250.0			350.0

Just listened to the Atlas earnings call & few points on this guidance

 

- appears to exclude potential earnings growth from APR energy - they are using APR 2021 Adjusted ebitda and adjusted earnings for years 2022-24

'For the long-term guidance provided above, APR’s Adjusted EBITDA and Adjusted Net Earnings contributions to Atlas are forecasted to be ~$103mn and ~$24mn, respectively (consistent with 2021 revised guidance)'

- includes current contracted cash flows only (but does not factor in any future contract wins)

'The guidance is based on the 55 newbuild vessels that we have contracted to acquire with no further vessel acquisitions assumed.'

 

On interest/op lease expenses - does anyone have any insights around Atlas assumed libor rates & risk aspects here? Appears they are using interest rate swaps to fix rates & mitigate their variable interest rate risk exposure.

 

 

 

 

 

 

 

 

[nwoodman]

These guys are executing beautifully.  The new CFO’s supplementary spreadsheets are super helpful too  https://ir.atlascorporation.com/earning-reports?cat=42.  Their core strategy of foregoing short term pricing power for longer term dependable cashflows that in turn drive down the cost of borrowing is Sokol to a tee.  All this, before he has even sunk his teeth into a sector he really understands.  Exciting times and I just hope Fairfax stays in the background and doesn’t try to do anything cute. Just let Sokol and co do their thing and it will be a $5bn+ position for Fairfax in less than a decade.

Edited August 11, 2021 by nwoodman

[petec]

10 hours ago, nwoodman said:

I just hope Fairfax stays in the background and doesn’t try to do anything cute. Just let Sokol and co do their thing

 

I don't think you need to worry about this. I think Fairfax basically recapitalised Seaspan in 2018 either on the condition that Sokol was involved, or because he was involved. They literally did it to let him do his thing and they won't change that now.

[nwoodman]

Not that it matters but I think it was because Sokol was already involved.  He was working for Dennis Washington at the investment company level and was sent in to advise on the situation at Seaspan.  

 

Our Fears (Hopes) Realized? | Marine Money

Seaspan chairman slams Wang and Porter for failing to grab boxship bargains - Splash247

 

One of the issues that has clouded ATCO has been the APR transaction and the perception of self dealing.  Its contribution this quarter, EBITDA of 45.3m hopefully goes some way to mitigating this perception.