Update on The MMM story.

There is one huge write-up on Star Biz on MMM ( past blog posting: The MMM story again. and The MMM story. )

• A lot more to do...for MMM to get back on track
  THE writing had been on the wall for some time. After Malaysian Merchant Marine Bhd (MMM) reported a massive RM146.8mil loss for the financial year ended Aug 31, 2006 (FY06), the company has been in the news for all the wrong reasons.

Some of the issues mentioned cannot simply be discounted at all, for it really represent the extreme poor financial condition of the company. For one, the downgrade by MARC is really worth noting:

• “This is underscored by the concern on the rapid deterioration in its financials stemming from very poor financial results, as well as other adverse financial impacts vis-a-vis its ageing fleet, aggravated by softening freight rates in most of the shipping segments it is involved in,” said the rating agency in a press release.

Ageing fleet, softening freight rates. It really highlights the extremely poor business economics the company is caught in. And then the board reshuffling.

• Earlier this week, MMM reshuffled its board, announcing the withdrawal of a service contract to managing director Tunku Mahmood Fawzy Tunku Muhiyiddin. Among other changes, chairman Tunku Datuk Mudzaffar Tunku Mustapha has stepped down, to be replaced by director Datuk Jaffar Indot.

A step forward but a bit too late, isn't it? The company is really in a terrible mess. And needless to say shareholders are disgruntled and less than happy.

Me? I am just wondering and concern about these shareholders. Their ship is clearly sinking. Why are still holding on? Hoping for a miracle or what?