First Ship Lease Trust sinks into the red with net loss of US$21.8 million

SINGAPORE - First Ship Lease Trust (FSL Trust) sank into the red in the second quarter as an impairment charge of US$24.1 million on eight vessels took a toll on its bottom line.

Net loss for the three months to June 30 was US$21.8 million, reversing the US$5.5 million profit a year ago.

Revenue was down 17.4 per cent year-on-year to US$20.9 million, due to the "dry-docking of two crude oil tankers... and softening rates across all shipping markets", the trust manager said.

The ship owner and leasing services provider posted a net loss of US$18.4 million in the first half year versus US$7.8 million in earnings previously, while turnover dropped 17.5 per cent to US$42.9 million.

Mr Roger Woods, chief executive of the trust manager FSL Trust Management, said: "Although the tanker and container markets remained under significant pressure in the second quarter of FY17, our fleet continued to generate positive cashflows and the trust has maintained its strong debt repayment momentum with over US$60 million of debt repaid over the last 12 months."

The difficult operating environment across all shipping sectors is expected to persist in the near term.

"But we remain focused on optimising the commercial deployment and operational performance of the fleet by securing quality contract cover through 2017 and beyond," Mr Woods added.

Quarterly loss per unit was 3.42 US cents, overturning earnings of 0.86 US cent in the second quarter last year.

Net asset value per unit dipped to 36 US cents as at June 30, compared with 39 US cents at the end of December last year.