of only 3 years. Based on the calculations of the costs of construction against the value of the contract‚ it is recommended that Ocean Carriers not go ahead with the construction. However‚ if a strategic alliance can be created with another carrier to lease their vessels‚ Ocean Carriers should accept the contract. If the strategic alliance is mutual‚ Ocean Carriers should build the vessel to add on to its own fleet. Key Financial Issues Mary Linn has to deal with the following key financial issues
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http://www.studymode.com/essays/Ocean-Carriers-133412.html Average daily hire rates are determined by market supply and demand. Factors such as the number of operating vessels‚ number of scrapped vessels per year‚ the age of the ships‚ the efficiency of ships‚ and market expectations of supply and demand; consequently‚ these factors drive average daily hire rates. Market conditions also drive rates since demand is dependent on the world economy. When the economy is strong‚ the demand increases‚
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Ocean Carriers Case Study Submitted by Fozia Abid Maryam Noor Nadia Farooq Umar Farooq Hamza Tariq Muhammad Mohsin Lahore School of Economics Ocean Carriers Report The fragmented shipping industry is one of the most essential industries for continuous globalization and growth; industry prospects are surprisingly stable in contrast to the normal logistics businesses that are highly cyclical. The factors that drive average daily hire rates are the age of vessels‚ market condition‚
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for the world economy‚trends in world trade and potential contracts; however‚ an estimated time of service should be assigned in order to predict future cash flows. Summary of facts In January 2001‚ Mary Linn‚ vice president of Finance for Ocean Carriers‚ had to decide whether to accept an offered leasing contract for the duration of three years. In the event of acceptance of the above-mentioned contract‚ the profits of the company would depend on the agreed hire rates‚ operating costs‚ ship depreciation
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Case Study: ‘Ocean Carriers’ By: Alyssa Linder Wenliang Zhang Xhangoli‚ Eva 1. Daily spot hire rates are determined according to supply and demand of the shipping capacity. According to the article‚ the supply of ships available equals the number of ships currently in the fleet plus any new ships added‚ minus any scrapings and sinking. According to Exhibit 2‚ there are a limited number of ships older than 24 years which are likely to be scraped. For those ships under the age group
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Financial Management Prof. Randy Fisher Case Study Questions: Ocean Carriers These questions relate to the Ocean Carriers case in your course packet. You can find the data for this case on the course website in a spreadsheet named: Ocean Carriers Exhibits.xls. This case provides the opportunity to make a capital budgeting decision by using discounted cash flow analysis to make an investment and corporate policy decision. Ocean Carriers is a shipping company evaluating a proposed lease of a ship
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the U.S.‚ these asylum seekers are also being ostracized‚ from the signing of executive orders by the new administration. The White House said that U.S steel is not required for the construction of the Keystone XL pipeline‚ despite the executive order that the president signed. The Keystone XL pipeline is a tool‚ that is globalizing North America; it is further connecting the United States and Canada‚ using a product that we all use‚ oil. Mercedes-Benz is recalling about 1 million cars and SUVs‚ because
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the Ocean Carriers Group is to evaluate the potential revenues and expenses of commissioning a new capsize ship for cargo transportation in order to meet a received demand for lease. A recommended approach would consist in analyzing the expectations for the world economy‚ trends in world trade and potential contracts; however‚ an estimated time of service should be assigned in order to predict future cash flows. Summary of facts In January 2001‚ Mary Linn‚ vice president of Finance for Ocean Carriers
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TransCanada argues with America how this Keystone XL pipeline will be one of the greatest ideas ever. They state how building the rest of the keystone pipeline system which is 1‚179 miles of the pipeline between Alberta and Nebraska which will boost the American economy. For the reason that this very expensive pipeline project will create over 9‚000 construction jobs in American for both men and woman. Also on the TransCanada website they promised‚ “Keystone XL will add more than an estimated $100 million
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The Keystone XL pipeline is a pipeline that runs from Canada to the United States. This pipeline would take expensive Canadian tar sand oil in Alberta to the southeast part of Texas next to the Gulf of Mexico‚ so petroleum products can be transported around the world. This great project would supply petroleum demands and create many jobs. The battle between industrialists for the petroleum and the environmentalists against the petroleum has great influence on the Keystone pipeline. The only thing
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