FSL Trust sinks into the red in Q3 on impairment losses
IMPAIRMENT losses and challenging market conditions in the shipping industry weighed down results for shipping trust First Ship Lease (FSL) Trust in its third quarter.
The shipowner and provider of leasing services fell into the red, chalking up a net loss of US$21.7 million, compared with a net profit of US$3.5 million in the previous year, the group said in a Singapore Exchange filing on Wednesday evening.
The loss was mainly driven by impairment charges of US$22.2 million on three chemical tankers and three product tankers, it said.
For the three months ended Sept 30, revenue fell 18.5 per cent to US$18.7 million from the preceding year.
The contraction in revenue was mainly due to softening rates across all shipping markets, which weighed on earnings from LR2 tankers, aframax crude oil tankers and container vessels, FSL Trust said.
Despite this, net cash from operations generated US$9.1 million in the third quarter.
As at Sept 30, FSL held US$19.6 million in cash and cash equivalents, having repaid US$52 million of debt during 2017.
"Shipping markets globally continue to face difficult environments, and that which FSL operates in has not been spared," Roger Woods, chief executive officer of FSL Trust's manager said.
"Despite market challenges, we are committed to the operational performance of our fleet and we are pleased to have delivered another quarter of positive cashflows. The board of directors and management continue to pursue refinancing opportunities, and it remains our priority to ensure the ongoing stability and future of the Trust."
FSL Trust units ended S$0.002 or 2.4 per cent higher at S$0.085 on Wednesday.
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