FSL says it has sufficient cash for now

Singapore owner positive after auditor says loss raises 'going concern' doubt.

First Ship Lease Trust (FSL) believes it has enough money for operational needs despite its auditor warning of doubt over its ability to continue as a going concern.

Singapore accountant Moore Stephens said the 2016 net loss of $30.99m, plus year-end liabilities exceeding assets by $179m, "indicate the existence of a material uncertainty which may cast significant doubt on the ability of the group and the trust to continue as going concerns."

But the company said it has enough cash to meet working capital needs and obligations when they fall due.

It also believes it will successfully refinance its bank loan and continue to be supported by lenders.

FSL has been trying to rejig debt due at the end of this year.

The tanker and boxship owner, whose CEO Alan Hatton resigned this year, posted a net deficit of $42.28m in the fourth quarter alone, against a profit of $0.83m in 2015.

It was hit by an impairment charge of $44.1m on five containerships, two crude oil tankers and one product tanker.

FSL later announced the pre-payment of $20m under a syndicated facility.

It added one of its MR products tankers to the loan as additional security.

The ship pledged to the banks is the 46,000-dwt FSL Osaka (built 2007), which the Singaporean owner bought in 2015.