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About PST

  1. Acquisition growth strategy
    • Pursue yield accretive acquisitions.
    • Improve portfolio diversification through multiple charterer and vessel types.
    • Capitalise on the right of first refusal granted by the Sponsor for new vessels.
    • Leverage on sponsor, PIL's network and relationships to secure new charters.

  2. Active charter and asset management strategy
      An exciting alternative in ship finance

      Pacific Shipping Trust (PST) offers an exciting, alternative to conventional ship finance. Based in Singapore, Asia's leading maritime hub, PST went public on May 26, 2006, becoming the first business trust listed on the Singapore Stock Exchange.

      PST is committed to providing global ship operators with a cost-effective means of expanding their fleet without straining their balance sheets. We do this through acquiring vessels and chartering them to reputable operators on either a time or bareboat charter. Through sale and leaseback, finance leases and other innovative arrangements, we help shipping companies achieve their growth strategy while remaining "asset light".

      Our objective is to grow our business by seeking yield-accretive acquisitions that will increase distributable cashflows to investors.

      PST is sponsored by Pacific International Lines Pte Ltd, Singapore's second largest container shipping company and the 19th largest in the world. PIL owns and operates more than 97 container vessels with close to 140,000 TEUs. Turnover for the PIL group reached more than S$3.8 billion in 2006.




      How the shipping trust works

      At the IPO, PST acquired eight container vessels from our sponsor PIL. These vessels were funded by a mix of debt and equity.

      These vessels were chartered back by PIL for periods ranging from eight and 10 years.. Thus, the Trust will not be directly exposed to the risk of fluctuating charter rates. Its income will be locked in at fixed rates for the duration of the charter. As the charters are on bareboat basis, neither will PST be exposed to the risk of rising ship operating costs. Its main risk will be the counter party risk of the charterer defaulting on their hire payments. To this end, PIL has been rated by Standard & Poor and awarded with a BBB rating which is impressive rating for Liner companies.
      　

      The Trust is able to distribute a high level of surplus income to unitholders because, unlike a company, it can distribute income out of cash rather than accounting profits. The income thus distributed is tax free to all investors, both individual and corporate.
      　

      Investors who buy into the Trust will be buying units (in US$) with a predictable & stable yield. On top of the yield, investors may also enjoy capital gains over time if the Trust is performs well.

    • Actively manage portfolio of charters and vessels

  3. Capital and risk management strategy
    Pay down the term loan facilities in relation to the vessels

    DPU grows as debt is reduced
    • Debt repayment lowers interest cost
    • When debt is fully repaid, cash flows are free to pay unitholders
    • Growth in distributable income when debt fully repaid

    While residual Net Asset Value for Unitholders is preserved
    • Depreciation of asset value mitigated by the reduction of debt
    • Residual net asset value for unitholders preserved


       

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