SINGAPORE - Shipping services company Marco Polo Marine has signalled that it plans to delay interest payment on notes that due to be paid on April 18.
It said in a stock exchange filing on Thursday (April 13) that "in view of the company's current cashflow position and proposed refinancing and debt restructuring exercise, the company does not expect to make payment of the April 2017 interest payment on April 18".
The reason for the default in interest payment was because the monies earmarked it "have been redeployed to working capital for business sustainability," noted chief executive officer Sean Lee.
Marco Polo Marine provides services that include ship chartering, ship building and repair, and brokering services.
It added that there will be engagement with its noteholders on the appropriate manner to address such outstanding payment pending the completion of the group's proposed refinancing and debt restructuring exercise.
The firm also announced in a separate stock exchange filing on Thursday that it intends to undertake a refinancing and debt restructuring exercise of all its current secured and unsecured debts.
The move is aimed at strengthening its cash flow and working capital position, as well as ensuring business sustainability under the current distressed market conditions or the foreseeable future.
"Various payments due under the group's bank loans, invoices and contracts remain outstanding, and the Group is in discussions with its bank lenders and other key creditors on restructuring these payments under the proposed debt restructuring plan that is within an acceptable level of gearing for the offshore marine industry, while at the same time exploring avenues for fresh funding," said Mr Lee.
The firm also issued a profit guidance in respect of the unaudited financial results of the group for its second quarter ended March 31, 2017.