[Dow Jones] First Ship Lease Trust is likely to fall after its manager said late Tuesday units of Indonesian shipper Berlian Laju Tanker defaulted on lease payments for three chemical tankers.
Berlian Laju, one of the world's largest chemical-tanker operators, said in January it would cease debt payments after breaching a loan-facility covenant and suspended its shares. FSLT, which has a 25-vessel portfolio, didn't provide the outstanding amount, but said the leases contributed 12.8% of FY11 revenue; FY11 revenue was US$110 million. It expects NTA/unit to decrease US$0.03 to US$0.50. FSLT said if it repossesses the vessels, other lease options are available, but at lower rates. The stock ended Tuesday flat at S$0.199; it is down 30.0% year-to-date after its Jan. 19 results release said it would cut 4Q11 DPU to US$0.0010 from 4Q10's US$0.0095 to conserve cash. Its S$0.194 all-time low is unlikely to offer much support. The news is also likely to weigh peers Rickmers Maritime Trust (B1ZU.SG) and Pacific Shipping Trust (P48U.SG).
- Leslie Shaffer, Dow Jones and Co