Otto Marine: No recovery in sight

Otto is struggling to stay afloat.All of its business segments have underperformed. While FY11 could have marked the bottom, we project it to remain in the red. Without a concrete business strategy to steer its way ahead, we advise investors to stay clear of the stock. 4Q core net loss was larger than expected (full-year at 286%).We now expect losses for FY12 and cut FY13 EPS by 40%. We also introduceFY14 numbers. We lower our target price, still at 0.6x CY12 P/BV (bottomend of its trading range). Maintain Underperform.
Source: CIMB 24 February 2012

A series of disappointed results from Otto Marine, make me agree to above mentioned report statement. Otto Marine is one of the must-avoid stocks now. 
Below Q&A get from Nextinsight about the CFO replied to the reporter. 

Q: What are you doing to increase your visibility in terms of order book?
We will continue to stay focused and put in all our effort to complete the work-in-progress of our existing newbuilds so that we can sell them or charter them out to generate cashflow.

"We are expecting better result contribution from Go Marine this year," said CFO Michael See.

Q: Mosvold vessels - Are you going to sell them?
We have received enquiries for these vessels. However, the current credit environment, particularly in Europe, has not been very helpful for the necessary vessel financing.

Q: Do you have plans for smaller vessels since this will not take up all your capacity?
We also tend to outsource construction of smaller and basic vessels to our strategic Chinese yards as it is more economical.

It is our strategy to build the more complex and sophisticated vessels at our Batam yard.

We intend to reserve certain of our yard space to accommodate potentially new and bigger ticket orders should the market pick up. Our yard is currently busy finishing the rest of the work-in-progress for newbuild vessels so that we can either sell them or charter them out.

Q: What kind of newbuilds are you targeting?
We have received enquiries on newbuilds and are working on the details.

Q: Is there a delivery schedule for your potential new orders?
Depending on the newbuild order, the larger vessels tend to take around 30 to 40 months to build.

Q: Is selling Reflect something you will consider?
We will be more conservative in future project bids and are committed in rebuilding the business at Reflect.

According to above Q&A, they do not have any firm newbuild order on hand. They keep their hope on chartering service which just a new borned baby to the industry. This sound to me like they are lost on their direction as their core business is not doing well so they tried to transform and adapt. Will their transformation and adaption work? They have no confident too. This look serious to me. Wish them all the best :(