First Ship Lease Trust

[KopiKat]

An extremely evasive piece of announcement following FSL's suspension:
http://info.sgx.com/webcoranncatth.nsf/V...E0005AD8B/$file/Announcement_Clarification_on_Extension_on_Covenants_Relaxation.pdf?openelement

There is hardly any clarity on what in the world is going on in the latest announcement. Memo to FSL managers who are now on notice of resignation: You do not do a press release titled "CLARIFICATION ON EXTENSION ON COVENANTS RELAXATION" when you have just requested for a suspension.

Basically the gist of the message is somebody went ahead to agree with the previous loan extension and make payment without obtaining a board resolution.

Now they are stuck in a limbo as the extension covenants are technically not in force since they were never legally agreed by FSL, i.e. they are in breach of covenants and in default.

It is bad enough to make poor business decisions, but seriously this level of admin cock up? And this is from a company that prides itself of having a proprietary risk management modelling developed by an ex-banker Chief Risk Officer?

Wah... 4 Directors quitting (looks like key ones even), left 2. Reasons given,

To the best of the knowledge of the board of directors, there are differences in opinion in respect of the management of First Ship Lease Trust and FSL Trust Management Pte. Ltd.


Hall of Fame (Shame??) list,

1. PHILIP CLAUSIUS - President and Chief Executive Officer

2. CHEONG CHEE THAM - Senior Vice-President and Chief Financial Officer

3. PHANG THIM FATT - Independent Director of the Board of Directors and Chairman of the Audit Committee

4. WONG MENG MENG - Chairman and Independent Director of the Board of Directors and Member of the Audit Committee

So, what's happening?? They disagreed with each other and all decided to leave?? Or, perhaps some half baked reasons to desert a sinking ship...?? Looking at AR2012, the irony is on the first page, in large fonts,

STAY THE COURSE

[specuvestor]

I'm very interested to know what is the role of the trustee and what would they do for the shareholders after getting all those trustee fees.

[Nick]

Isn't the Trustee and the Manager the same entity in a business trust ? They appointed 3 new directors this month (including 1 non-executive director) - I guess they will be spear-heading the move to renew the Management team, find a new charterer for the 2 defaulted crude oil tankers and possibly restructure the Trust.

(Not Vested)

[safetyfirst]

Woohoo!!!

i was looking at the financial statement of mar 2012, given up on this company long ago

All figures in thousands
Distribution to unitholders (655)
Repayment of secured bank loans (11,000)
Interest paid (7,040)

You will be lucky if this shity management can continue to pay shareholders $655,000 amounting to 0.13 cents per share while deleveraging. They will probably have to continue paying off debt for the next 8 to 10 years. Many many years later, then they can start to save money to buy a few ships that will probably be just enough to pay the salary of management. Try discounting the cashflow for many years later, you will be lucky enough to value the company at even 10 cents today.

This shipping trust is gone case, dont carry too much hopes. It will probably do a rights issue or do a share placement soon and dilute your shares.

SELL NOW before it gets too late !!!!!!!!!!!! This stupid management enjoy paying the bankers instead of shareholders. Dont trust what they say at the AGM, trust the dividends that can be paid to you. I wont buy this shity trust at 17 cents, maybe not even 10 cents without a more detailed calculation

It doesnt take great insight to see that this shipping trust is a piece of Sh**. I strongly believe that its intrinisic value is close to zero (or even negative), if you can sell it for 17 cents today, you should count yourself lucky. Its intrinsic value today is far less than 17 cents even when i use the most optimistic figures.

I havent taken a look at rickmers for quite some time, however, i think it is little different from FSLT.

I think the downfall for the both trusts is the fact that management think they can get away with high leverage, it may work for freehold properties but never with ships that have a limited lifesapn

So so TRUE.. After 1 year, this trust seems to validate your
"I strongly believe that its intrinisic value is close to zero (or even negative)"

I think many people didnt want to heed your advice cause they were blinded by the high yield

[KopiKat]

Woohoo!!!

i was looking at the financial statement of mar 2012, given up on this company long ago

All figures in thousands
Distribution to unitholders (655)
Repayment of secured bank loans (11,000)
Interest paid (7,040)

You will be lucky if this shity management can continue to pay shareholders $655,000 amounting to 0.13 cents per share while deleveraging. They will probably have to continue paying off debt for the next 8 to 10 years. Many many years later, then they can start to save money to buy a few ships that will probably be just enough to pay the salary of management. Try discounting the cashflow for many years later, you will be lucky enough to value the company at even 10 cents today.

This shipping trust is gone case, dont carry too much hopes. It will probably do a rights issue or do a share placement soon and dilute your shares.

SELL NOW before it gets too late !!!!!!!!!!!! This stupid management enjoy paying the bankers instead of shareholders. Dont trust what they say at the AGM, trust the dividends that can be paid to you. I wont buy this shity trust at 17 cents, maybe not even 10 cents without a more detailed calculation

It doesnt take great insight to see that this shipping trust is a piece of Sh**. I strongly believe that its intrinisic value is close to zero (or even negative), if you can sell it for 17 cents today, you should count yourself lucky. Its intrinsic value today is far less than 17 cents even when i use the most optimistic figures.

I havent taken a look at rickmers for quite some time, however, i think it is little different from FSLT.

I think the downfall for the both trusts is the fact that management think they can get away with high leverage, it may work for freehold properties but never with ships that have a limited lifesapn

So so TRUE.. After 1 year, this trust seems to validate your
"I strongly believe that its intrinisic value is close to zero (or even negative)"

I think many people didnt want to heed your advice cause they were blinded by the high yield

I don't think the more recent investors were 'blinded by the high yield'. Exactly one year ago, it was the beginning of their ZERO DPU Dividend Policy.... Prior to that, DPU was reduced to US0.1ct from Dec-11 Quarter. So, it could only blind many with their high yield only prior to Dec-11.

Most likely, recent investors may have been blinded by expectations of a resumption in DPU. The original ZERO DPU policy was supposed to last till Jun-13, but had been extended.... indefinitely(?). Others may have expected a turnaround situation for the Shipping Industry (after seeing improving BDI figures), without realising that many of the FSL ships were already on high charter rates contracts, which will be expiring in the coming months or years...if not earlier, due to defaults...

Now, instead of getting better, it seems to be getting worse... Senior mgmt quitting in mass... to me, it looks like the Captain and his Senior Officers jumping off a sinking ship....

Latest Quarterly results look bad... Latest 2 defaults (left 18/25 on long term charter) causing a big drop in Revenue and a Loss, even at the Operating level.

News Release
Financials

[Stockerman]

This is a counter to be shorted/dumped few years ago... the ship is sinking fast...

---

Is this time to buy again?

For those pessimists that are so confident that FSL is worth less than 5 cents, you are more than welcome to short the counter.

FSL made some silly mistakes earlier and paying the price now. I'll give them awhile to set the ship straight again.

[mulyc]

haha, this counter has trapped SOOOOooo many high yield hunters for so many years that it has stopped being funny any more.

remember it even hit 1.50 shortly after IPO.

what a joke man.

[cif5000]

Is this time to buy again?

You want to buy also cannot...counter is suspended from trading.

Unit holders no choice got to become long term investor. No need to check price everyday. Can sleep better.

[Dividend Warrior]

The Board have difficulty finding a new CEO and CFO.

These 2 positions are still vacant!

I dun see any talented people taking up positions in this down-spiralling company.

[cif5000]

Is this time to buy again?

You want to buy also cannot...counter is suspended from trading.

Unit holders no choice got to become long term investor. No need to check price everyday. Can sleep better.

Anyone looking to unload this stock? Can PM me.