First Ship Lease Trust

and another thought - it seems that the accounting lifespan of the ship and corresponding depreciation is based on the charter contract length.

For example, a new ship is contracted with 10 years charter. Say the charterer default halfway at 5 years, and the TM redeploy the ship to a pool - the useful life (for depre figures) will be revised from initial 10 years to 25 years.

am I right?

http://fairplay.ihs.com/ship-constructio...rom-jinhai

Price of newly built chemical tankers (around 20,000 DWT) ~ USD 35 m per vessel (Made in China)

FSL's 3 chemical tankers were built in Japan in 2006 ( about 11 year old), what is their likely current values ?
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Long Term Asset Value (“LTAV”), interesting concept...............................
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WHAT’S A SHIP WORTH? IN THIS INSTANCE, ONLY A MATHEMATICIAN CAN TELL YOU!
https://www.marinemoneyoffshore.com/node/4471
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(20-04-2017, 04:16 PM)ZZF Wrote: and another thought - it seems that the accounting lifespan of the ship and corresponding depreciation is based on the charter contract length.

For example, a new ship is contracted with 10 years charter. Say the charterer default halfway at 5 years, and the TM redeploy the ship to a pool - the useful life (for depre figures) will be revised from initial 10 years to 25 years.

am I right?

Useful life of a vessel is an estimate of the average number of years the vessel is considered useable before its value is fully depreciated.
 
Useful life of a modern vessel is about 25 to 30 years.
 
Depreciation is the systematic allocation of the acquisition cost of the vessel, less its estimated residual value or (or salvage value) over the vessel’s estimated useful life.”

It has nothing to do with charter contract length.
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(20-04-2017, 06:26 PM)Boon Wrote: http://fairplay.ihs.com/ship-constructio...rom-jinhai

Price of newly built chemical tankers (around 20,000 DWT) ~ USD 35 m per vessel (Made in China)

FSL's 3 chemical tankers were built in Japan in 2006 ( about 11 year old), what is their likely current values ?
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My guess would be USD18m. I assume that tankers lose USD1m with each passing year, and 2009 built are worth USD21m.


In Jan 2017, 2009 built were sold for USD21.2m
In Dec 2016, 2012 built was sold for USD24m
In May 2016, 2007 built was sold for USD20.5m though this came with a 3Y charter at USD15,000 per day. 

https://www.google.com.sg/amp/www.tradew...sd-65m/amp

As the price get more tempting day by day, am hesitant to add more to this counter mainly because

1) above posts on issue of rights
2) internal dispute and unrest btw management and unsure of their next plan
3) rickmar jus sold their vessel which amt to more than half the nav, which lead me to conclude that this could be a value trap
stock

Mgmt is pretty sure of their next step: To keep FSL alive so that they can continue managing it for a fee. The issue is whether will the banks roll over the debt or they need rights to keep it afloat.

For FSL, to issue rights to ensure its survival is pretty sustainable unless the trust collapses by another say 20% in market value. This means FSL will have to issue a lot of rights (more than 100% of share capital) to repay the principal to satisfy banks through the rights proceeds.

(21-04-2017, 09:06 PM)CY09 Wrote: Mgmt is pretty sure of their next step: To keep FSL alive so that they can continue managing it for a fee. The issue is whether will the banks roll over the debt or they need rights to keep it afloat.

For FSL, to issue rights to ensure its survival is pretty sustainable unless the trust collapses by another say 20% in market value. This means FSL will have to issue a lot of rights (more than 100% of share capital) to repay the principal to satisfy banks through the rights proceeds.

What i mean is that we are not sure of management's intention. Seem to me they are not protecting shareholders interest. The timings of their announcement is something that irked me. 

In the last fy announcement,the ceo mentioned that they are confident of refinancing by 2nd fy 2017. Now they are singing different tunes about depreciating value of vessels. With the rickmars saga, it will get harder to secure a gd deal.

(22-04-2017, 05:13 PM)Greenhorns Wrote:

(21-04-2017, 09:06 PM)CY09 Wrote: Mgmt is pretty sure of their next step: To keep FSL alive so that they can continue managing it for a fee. The issue is whether will the banks roll over the debt or they need rights to keep it afloat.

For FSL, to issue rights to ensure its survival is pretty sustainable unless the trust collapses by another say 20% in market value. This means FSL will have to issue a lot of rights (more than 100% of share capital) to repay the principal to satisfy banks through the rights proceeds.

What i mean is that we are not sure of management's intention. Seem to me they are not protecting shareholders interest. The timings of their announcement is something that irked me. 

In the last fy announcement,the ceo mentioned that they are confident of refinancing by 2nd fy 2017. Now they are singing different tunes about depreciating value of vessels. With the rickmars saga, it will get harder to secure a gd deal.

From Rickmer saga, I noticed that the selling of the vessels (and its selling amount) are at the disposal of the Management? Wao, there isn't a need to get approval from shareholders?
If that is the case, the value of the vessels are impractical to gauge!?

Rickmers got EGM approval 31 oct to wind up the trust if no alternative