ValueBuddies.com : Value Investing Forum - Singapore, Hong Kong, U.S.

Another one can explain what's the additional report of directors and financial statements for? It came together with the AR. the figures in that report seems strange.

its just the performance of the trust manager operating FSL. Revenue is how much the trust manager is extracting from FSL and its shareholders for managing First Ship Lease Trust

If Shareholders vote no to rights during this AGM and if the bank does not wish to refinance at a later date, FSL will have to convene an EGM. In the EGM, shareholders will have to vote on resolution (including winding down of a trust). If it really goes down to this predicament, my sensing is that sharreholders will be logical and try to find a way for a rights to be approved during the EGM. This is because it has gone down to as Boon has said "the rights is now used for FSL's survival and becomes a logical step"

(17-04-2017, 03:51 PM)ZZF Wrote: [ -> ]If they can't get refinancing by end year and shareholders vote no for rights , high chance end up like rickmers ?

It may be better to liquidate the company and return value to investors.  After all we invest to receive income, we have not been receiving it in the past 3 years, at the rate it is going, will not see any income in the foreseeable future.  What then is the purpose of having this Trust?  Management of the Trust mustn't forget about the sole purpose of the Trust, give value to unit holders.  In the past years, the trust has been making profits, but it doesn't benefits the unit holders at all.  And now, the Trust is looking at unit holders to pump in more money  Does it make sense from unit holders' perspective?

(18-04-2017, 12:04 PM)tsc3024 Wrote: [ -> ]

(17-04-2017, 03:51 PM)ZZF Wrote: [ -> ]If they can't get refinancing by end year and shareholders vote no for rights , high chance end up like rickmers ?

It may be better to liquidate the company and return value to investors.  After all we invest to receive income, we have not been receiving it in the past 3 years, at the rate it is going, will not see any income in the foreseeable future.  What then is the purpose of having this Trust?  Management of the Trust mustn't forget about the sole purpose of the Trust, give value to unit holders.  In the past years, the trust has been making profits, but it doesn't benefits the unit holders at all.  And now, the Trust is looking at unit holders to pump in more money  Does it make sense from unit holders' perspective?

At one point in time (2015) after the collapse of oil prices, FSL's vessels were worth so much such that if they were liquidated, the trust NAV should be worth more than 2.5x of today's share price. Today, the prices of Aframax tankers have fallen in half. Need to work out the liquidation NAV again if this is the course of action.

If time is not on their side when liquidating , think fire sale, after paying the banks, stockholders may be worst off? Then if we did a rights issue and say the cycle recovers subsequently and start paying dvd?

The good thing for FSL is the lucrative Yang Ming contract which will nett 20.8 mil annually until mid 2020. After which, i feel the trust should scrap the ships which will nett another 13.5mil. So if the liquidation drags, FSL is able to keep paying down the principal, unlike rickmers case where I paying the interest was difficult let alone the principal.

(18-04-2017, 02:08 PM)ZZF Wrote: [ -> ]If time is not on their side when liquidating , think fire sale, after paying the banks, stockholders may be worst off? Then if we did a rights issue and say the cycle recovers subsequently and start paying dvd?

TM will want to continue with the trust and earning from this coy. My gut feeling is that TM proposed of rights issue  is to partly pay down loans to get new refinancing, and most part of the money would be use for acquisition.

a few things to note

• in the current environment, re-financing could be tough as banks are reluctant to lend
  
• although useful life of vessels traditionally have been 25 years, recently ships as young as 7 years have been known to be scrapped
  
• there is a trend towards larger and more fuel efficient vessels, obsolescence is a possibility for older vessels
  

FSL Hong Kong enters Teekay Revenue Sharing Agreement

Singapore, 18 April 2017 – FSL Trust Management Pte. Ltd. (“FSLTM”), as trustee-manager of First Ship Lease Trust (“FSL Trust” or “the Trust”), announces that the Trust has agreed to employ the vessel FSL Hong Kong (a 115,000 DWT Aframax crude oil tanker), post dry docking, in the Teekay Group (“Teekay”) Revenue Sharing Agreement (RSA).

This agreement continues the Trust’s relationship with Teekay, which started back in 2013. Teekay was established in 1973, and has developed from being a regional shipping company into one of the world’s largest marine energy, transportation, storage and production companies, with four NYSE listings. Teekay is the world’s largest Aframax owner, and commercially manages over 100 tankers, including Suezmax, Aframax and LR2 vessels. Roger Woods, Acting Chief Executive Officer of FSLTM, said, “We are very pleased to announce the employment of FSL Hong Kong in the Teekay RSA, strengthening the Trust’s valued relationship with this market leader in the Aframax segment.”

(18-04-2017, 06:53 PM)Mancunian2 Wrote: [ -> ]a few things to note

• in the current environment, re-financing could be tough as banks are reluctant to lend
  
• although useful life of vessels traditionally have been 25 years, recently ships as young as 7 years have been known to be scrapped
  
• there is a trend towards larger and more fuel efficient vessels, obsolescence is a possibility for older vessels
  

The latter 2 points are more applicable for containerships. FSL's variability is more about the tankers, as it is almost a given that its containerships would be scrapped once the contract terminates.