SGX issues trade with caution on Mercator Lines

The Singapore Exchange warned investors to trade Mercator Lines shares with caution after a "substantial increase" in the traded volume of the company's shares on August 13 and 14 this year.
The Singapore Exchange warned investors to trade Mercator Lines shares with caution after a "substantial increase" in the traded volume of the company's shares on August 13 and 14 this year.PHOTO: ST FILE

SINGAPORE - The Singapore Exchange warned investors on Monday (Aug 17) to exercise caution in the trading of Mercator Lines (Singapore) shares.

The exchange had asked the Indian-owned dry bulk shipping company last Friday to explain a "substantial increase" in the traded volume of its shares on August 13 and 14 this year.

The company responded that it was not aware of any reason that might explain the increased trading. It noted it had announced on June 3 that it was seeking advice and working with creditors and potential investors to establish a "refinancing, recapitalisation and restructuring plan".

In May this year, Mercator Lines reported that it had incurred a US$125.4 million loss for the year ended March 31, 2015, more than the US$22.8 million loss it suffered a year ago, as the bottom line was hit by exceptional items.

Revenue for the year fell 25 per cent to US$56.3 million, owing to a fall in spot and contract rates, as well as unscheduled repairs.

The firm had said in a statement: "Falling commodity prices, an oversupply of new bulk carriers and weakening international demand have resulted in a considerable slowdown in global trade and downward pressure on freight rates."

jkoh@sph.com.sg