First Ship Lease Trust *Official* (SGX: D8DU)

[Asphodeli]

From 0.13x to 0.190 in a month. Company demonstrating financial prudence by not giving dividends, doing share buybacks. Slow and steady as she goes!

 

[MrGachaMan]

So this shares potential to buy for short and mid term?

 

[Asphodeli]

So this shares potential to buy for short and mid term?

its for long term, 3 to 5 years or more...I don't think it's a good price to enter, it has run up too fast for my liking. Don't risk more than 3 digits on this.

 

[V_for_Vanilla]

From 0.13x to 0.190 in a month. Company demonstrating financial prudence by not giving dividends, doing share buybacks. Slow and steady as she goes!

The management seems bent on boosting the share price which can be achieved by either share buybacks or give out dividends. The former is less convincing and concrete imo.

 

[Asphodeli]

Slow road to recovery...hopefully it crosses 20 cents by Sept, and hopefully, give a 1-2% dividend yield as a Christmas present

 

[Asphodeli]

FSL Trust announces new time charter contracts for three
tankers worth up to US$61 million

Singapore, 6 July 2015 – FSL Trust Management Pte. Ltd. (“FSLTM”), as trustee-manager of
First Ship Lease Trust (“FSL Trust” or the “Trust”) announces new time charter agreements for
FSL Shanghai, FSL Hamburg and FSL Singapore.
The Trust has reached an agreement with a leading global commodities trader to charter the
three vessels for a fixed period of two years with options to extend the agreements at a higher
rate for FSL Hamburg and FSL Singapore for a further six months and FSL Shanghai for a
further 12 months. FSL Hamburg and FSL Singapore are MR product tankers built in 2005 and
2006 respectively whilst FSL Shanghai is an Aframax crude oil tanker that was built in 2007.
The time charter agreements are expected to commence during the second half of this year and
are anticipated to generate up to US$61 million in revenue for the Trust over the next three
years.
During the two year base period under the new employment, FSL Shanghai’s net daily rate
represents a 54% increase while FSL Hamburg and FSL Singapore’s net daily rate represents a
31% increase for each vessel as compared to the previous time charter agreements. The
increased rates reflect the continued tanker market improvement and demonstrate FSL Trust
Management’s ability to achieve strong charter rates with good counterparties ensuring stable
cash flows for the Trust.
Alan Hatton, Chief Executive Officer of FSL Trust commented: "We are delighted to have
secured new time charter contracts for FSL Shanghai, FSL Hamburg and FSL Singapore with a
leading market player. The new rates are significantly above the current employment rates for
the three vessels and the projected revenue will generate significant cash flow for the Trust.
These new contract agreements are another positive step forward for the business, providing
stable and improved cash flows for the Trust.”

Slow and steady she goes!

 

[Asphodeli]

First Ship Lease Trust - Smooth sail ahead with solid set of results

Previously plagued by multiple defaults on its long-term charters, First Ship Lease Trust (FSL) has staged a strong comeback since the change of the management in 2013. FSL is no longer in breach of the Value-to-Loan (VTL) loan covenant that resulted in a stoppage of dividend payments, and is set to ride the rising tanker market.

Potential resumption of dividends from strong cashflows
FSL could resume dividends after turning compliant with its loan covenant. From its TTM income available for distribution, FSL could pay ~1 S cent dividend per quarter (23.5% yield). Even if income from the containerships expiring in 2016 is not replaced, our model projects a min dividend potential of 0.6 S cents per quarter (13.6% yield) going forward. As the management prefers to wait to ensure that the distribution is reliable and sustainable if resumed, FSL has meanwhile embarked on share buybacks.

Booming tanker rates
FSL is the only SGX-listed shipping trust with a large exposure to tankers (16 out of a fleet of 23), benefiting from the surge in tanker rates. Demand for oil tankers increased with low oil prices, increasing imports by countries such as China and use of tankers as floating storage. Increased throughput of refined products and increasing voyage distances also bode well for the product tankers. As the oncoming supply does not appear excessive, we are bullish on the tanker segment.

Cheap even if we conservatively revalue the book to market
Even if we conservatively revalue FSL’s vessels to market and exclude the contracted revenue worth US$157m, which are above market rates, our derived net assets of US$123.4m (S$169.1m) are still above FSL’s market cap today.

Extremely attractive with large discount to book, high profitability and strong cashflow generation
We value FSL at 26c (48% upside), equivalent to the revalued P/B of 1, while it is only trading at revalued P/B of 0.68 today. In the meantime, FSL’s peers are trading higher at P/B of 1.3, without revaluation of their book. We see great potential for FSL to rerate upwards. We will consider using a DCF valuation if FSL resumes regular dividends. Our DCF valuation, on conservative assumptions, puts the potential TP at 29c. The current product tanker charter rate has also roared ahead of our conservative assumptions. Profits are set to expand from decreasing depreciation and interest savings from aggressive repayment of debt. (Read Report)

Source : KGI Fraser Research

Another profitable quarter!

 

[MVCPattern]

Could First Ship Lease Trust be a high dividend yield stock?
http://www.investmentmoats.com/money-management/dividend-investing/ship-lease-trust/

Vested @ 0.169

 

[TiOnGSquare]

i just vested a few weeks ago

going to see how it performs

 

[Perisher]

Just read up on the links. Joining you guys soon.

 

[Asphodeli]

Lying low for the moment for me to re-enter. Wish I didn't dump 90% of my allocated holdings during the August selldown - I would have locked in an easy 29% gain over the 11 months!

Sent from Sony D5833 using GAGT

 

[Asphodeli]

Interesting; today FSL posted changes in their substantial holders interest - creditors seems to have liquidated their holdings (or cancelled the shares?), meaning the $2mil+ set aside under the loan refinancing terms back in 2012/2011 can be deployed for other uses.

 

[Weaboo]

What makes this a good holding?

Was considering this cause the mgmt bounced back from the doldrums of the Great Recession

 

[Weaboo]

5 years ago this one a hot dividend stock
now this one like gg riao
same fate as rickmers?

rev not bad leh, always increasing

 

[mikafire]

was bad..nw definitely better than Rickmers who stil has high rental incomes fr 2007 era in their books but contract expiring soon..FSLT rental r based on current market rate

Hope dividend can b paying once mgt settle t 2 old tankers

 

[Asphodeli]

Someone from the VB forum mentioned that it's a capital restructuring of the holding company for FSL. Nothing to be worried about, as FSL's LTV ratio is at 110% (or more), which means they have met the cash reserves requirement for their loan and debt has been slowly winding downwards through their quarterly cash sweep mechanism to pay down their debts.

Eyes on their full year report now...should be positive lah, I guess.

Only problem I see is that 2 of their containerships are going to be scrapped. Management can either scrap and buy a new containership (tiagong got firesales now), or perhaps reduce containership business by not getting new containerships. I'm hoping for the latter.

 

[Asphodeli]

was bad..nw definitely better than Rickmers who stil has high rental incomes fr 2007 era in their books but contract expiring soon..FSLT rental r based on current market rate

Hope dividend can b paying once mgt settle t 2 old tankers

The 2 old tankers - you referring to the 2x 1990s era containerships? FSL announced that they sold off 2 of their containerships today, but sadly at a loss However, the proceeds were mostly used to pay off debt, which is a good thing!

 

[mikafire]

The 2 old tankers - you referring to the 2x 1990s era containerships? FSL announced that they sold off 2 of their containerships today, but sadly at a loss However, the proceeds were mostly used to pay off debt, which is a good thing!

u r rite..is t 2x old containerships..is gd to hear t proceeds mainly to payoff debts..aftr tis, seem no more major issue for FSLT for t moment

 

[donovan2007]

FSL TRUST halt

What will be the news..
Good or bad?

 

[uncle168]

i think yang ming return the ships