An Analysis on Rickmers Maritime Trust

Rickmers Maritime Trust is listed on 4 May 2007

Note: All data quoted in priced is USD unless otherwise stated

Financial Data

Yr                  Rev                   Net Income             DPU
2013                                                                        2.4c
2012           151.101 mil           27.623 mil                2.4c
2011           155.872 mil           40.326 mil                2.4c
2010           155.968 mil          (28.553) mil              2.31c
2009           162.228 mil           40.741 mil                3.91c
2008           111.758 mil           34.437 mil               8.89c
2007*           42.488 mil             20.596 mil             5.644c         *- proforma

Other Data (as of 30 Sept 2013)

Debt:

• Current: 48.765 mil
• L.Term: 406.043 mil
• Total: 454.808 mil

Convertible Bond @ $0.399385 : USD 50.417 mil

Cash Bal: 57.836 mil

Share Issued: 847,350,000

Diluted with full bond conversion: 1,028,613,067

NAV: $0.63

         : $0.52 (diluted)  => SGD 0.64 (US$ 1 => SG $1.23)

Opinion

After the downfall in 2010, this trust has been struggling to stay afloat. With 16 containerships currently chartered on fixed rate time charter currently reported on 30 Sept 2013, my opinion is that we may have seen the slump in the shipping industry. Although it may have seen its worst day, there is need to see that it expands its services to increase its stagnant revenue. The last 2 yrs of revenue stay around 150 mil. which is relatively stable.

For its debt issue, the mgmt has managed to solve its convertible bonds issue. Short-term debt should not be a problem for the company. What matters is the debt carried after 1 yr. Thus, rights issue or private placement is possible.

Conclusion

With its current dividend yield at around 10%, this counter is good to pick up in the short term as it gives a stable dividend of 2.4c  per annum. It is trading below its book value with a 50% discount, this provide a margin of safety for us.

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