Rickmers falls into red on impairment losses

SINGAPORE - Impairment losses amounting to US$63 million (S$78.8 million) dragged down the performance of container ship operator Rickmers Maritime last year.

The mainboard-listed trust logged a net loss of US$16 million for the 12 months ended Dec 31, reversing from a net profit of US$23.5 million the year before.

Barring the impairments charges, which were for both vessel and goodwill, Rickmers Maritime would have seen profit rise from US$44.2 million in 2013 to US$47 million last year, said its trustee-manager on Thursday.

Distribution per unit remained flat at 2.4 US cents for the year, and at 0.6 US cent for the three months ended Dec 31.

The declared distribution will be paid on Mar 27.

Net profit for the quarter came in at US$11.2 million, up from a net loss of US$8 million previously, even as charter revenue dropped 12 per cent to US$31.87 million on the back of reduced charter rates for four of its vessels.

This was thanks to other income - mainly from decreasing deferred income from charter contracts and interest - which rose 38 per cent.

The trust's fleet, which comprises 16 containerships, saw a utilisation rate of 99.9 per cent for the quarter.

However, a number of its existing charter agreements are due to expire in the course of this year, leaving only 64 per cent of it employed for 2015.

Mr Thomas Hansen, chief executive of the trustee-manager, said that while it is looking to secure new employment for the relevant vessels, the "new agreements will have to be made at spot rates that are likely to be lower".

"The uncertainty surrounding the timing of a charter market recovery poses a risk to the trust's earnings and cash flows," he said.

"Nevertheless, it is encouraging that the industry has begun recovering gradually and rates are higher now than they have been in recent times."

Rickmers Maritime units closed half a cent down at $0.285 on Thursday.