Pacific Shipping Trust (PST)

[freedom]

for me, as long as the shipping trust can survive and have a balanced debt-to-equity ratio and not pay distribution out of depreciation and not have huge un-financed commitment, it should be a good long term yield investment.

[Nick]

PST released another stable set of results while declaring a DPU of 0.809 US cents which represents a 75% payout based on its EPS of 1.11 US cent. NAV surged to US$0.414 (or US$244 million) which is a Trust record due to the increase in retained earnings.

I am looking forward to the delivery of 2 X Capesize vessel leased to Shagang in Sept 2011. This should increase 2011 DPU by some margin. Gearing will increase going forward as the newly acquired vessels are delivered.

SGX Announcement: http://info.sgx.com/webcoranncatth.nsf/V...D003421E7/$file/PST_Q4FY2010_Results.pdf?openelement

Press Release: http://info.sgx.com/webcoranncatth.nsf/V...D0034F68F/$file/PST_4QFY2010_PR.pdf?openelement

PST will become a diversified shipping trust in the years to come with a sustainable business model. I highly expect US$40 million worth of new equity to be raised in 2012 to reduce its overall gearing. I certainly hope they maintain this payout ratio to give them some breathing room in times of difficulties.

(Vested)

[tonylim]

4Q revenue down slightly.

[Nick]

Revenue dropped due to more off-hire days from its T/C vessels which under-went technical repair.

I estimate that the 2 Capesize vessels (to be delivered in Sept 2011) will add 0.19 US cent to the FY 2011 DPU. I assumed a 33% net margin and 70% payout policy.

At the moment, PST is trading at US$0.37 which is a slight discount to its book value of US$0.414. It's share price reflects a historic dividend yield of 8.72% and a PER ratio of 8.1.

[Nick]

DBSV released a research report today maintaining its BUY rating with a TP of 40 US cents.

http://www.remisiers.org/cms_images/rese...y_DBSV.pdf (Look forward to DPU growth)

I have similar estimates with the DBSV report and do expect equity fund raising to take place in 2012 to fund the equity portion of the Glovis purchase while lowering its overall net debt to equity to below 100%. Please bear in mind that the Glovis purchase has yet to be financed.

(Vested)

[Nick]

Owners warned over huge decline in ship values
by Lloyds List — last modified Jan 25, 2011 12:14 PM

http://www.lloydslistdcn.com.au/archive/...hip-values

I am posting this here to remind shipping trust unit-holders that the risk of asset devaluation remains high as long as the shipping over-supply isn't resolved. Ship Trust with VTL covenants in their loans will be directly impacted by any down-wards pressure in the vessel valuation.

PST has 5 un-financed vessel capex due to be delivered in 2H 2012 and 1Q 2013. Will this impact its ability to secure attractive financing ? Granted, the revenue to asset ratio of the 9 recently acquired vessel is superior to its current fleet ratio which implies an accretive acquisition. Either way, I expect PST to raise at least US$50 million to strengthen its balance sheet further in 2012. This makes up slightly less than 25% of its current market capitalization or NAV.

(Vested)
PS: Shipping Trust isn't a low risk-high return investment. There are risk involved so study them well before buying/selling.

[Nick]

PSTM APPOINTS LIM SIM KEAT AS CEO

http://info.sgx.com/webcoranncatth.nsf/V...B000AFE2D/$file/PR_CEO_Appointment.pdf?openelement

At long last, PST will have a CEO after nearly 1.5 years !

[Nick]

Since I am a 'substantial contributor' to this thread, I reckon it is only fair that I reveal any changes in my shareholding in this shipping trust. I sold all of my shareholding in Pacific Shipping Trust at $0.37. I had a great run with it but alas, the depreciating USD/SGD rates has forced me to re-think the viability of holding on to a US$ denominated stock (especially with its cash-flow consisting purely of USD).

[tonylim]

Since I am a 'substantial contributor' to this thread, I reckon it is only fair that I reveal any changes in my shareholding in this shipping trust. I sold all of my shareholding in Pacific Shipping Trust at $0.37. I had a great run with it but alas, the depreciating USD/SGD rates has forced me to re-think the viability of holding on to a US$ denominated stock (especially with its cash-flow consisting purely of USD).

Hi Nick,
Hope you can continue to contribute to this thread although you have sold your holding. Cheers.

[Musicwhiz]

Business Times - 08 Feb 2011

Pacific Shipping Trust names new CEO

By JOYCE HOOI

PACIFIC Shipping Trust has a new chief executive officer - Lim Sim Keat - who will take over the position in March, its trustee-manager, PST Management Pte Ltd (PSTM), announced yesterday.

Mr Lim, a permanent resident of Singapore, has almost 20 years of experience in the shipping industry and has worked for Nova Shipping and Logistics Pte Ltd, Austral Asia Line and two of the Kuok Group's shipping agencies - Newship Agencies Pte Ltd in Singapore and PT New- ship Nusabersama in Jakarta.

'My fellow directors and I are delighted to welcome SK on board. With his strong shipping credentials and regional exposure, we are confident that he is well-positioned to maintain PST's strong growth momentum and bring the firm to new heights,' said Ben Kwek, the chairman of PSTM.

The trust's acting CEO, Teo Choo Wee, will return to the trust's sponsor - Pacific International Lines Private Limited - and will stay on as a director on the board at PSTM.

'We would like to thank Choo Wee for his significant contributions in the past year as he led PSTM to complete three major accretive acquisitions which have more than tripled PST's total contracted revenue from US$250 million to about US$800 million up to the year 2023, and almost doubled its portfolio of vessels from 12 to 21 vessels,' added Mr Kwek.

Mr Teo had stepped up as acting CEO after the surprise resignation of the trust's CEO, Alvin Cheng, in 2009. Mr Cheng had been in the position for barely more than one-and-a-half years and had resigned to pursue his personal aspirations, according to PSTM.