ATLANTIC NAVIGATION HOLDINGS (SINGAPORE) LIMITED
(Company Registration No. 200411055E)
________
RESPONSES TO QUERIES RAISED BY THE SINGAPORE EXCHANGE REGULATION
The Board of Directors (the "Board") of Atlantic Navigation Holdings (Singapore) Limited (the "Company", and together with its subsidiaries, the "Group") refers to the Company's announcement dated 1 March 2022 (the "Announcement") on its unaudited condensed interim consolidated financial statements for the financial quarter and year ended 31 December 2021 ("FY2021") and wishes to provide its responses to the following queries raised by the Singapore Exchange Regulation Pte. Ltd. ("SGX RegCo") on 9 March 2022, as follows:
SGX RegCo's Queries | Company's Responses | |||||||
1. The | Group | recorded | (i) Aging schedule of the Group's trade receivables are set out below: | |||||
US$11,171,000 | in | trade | ||||||
receivables as at 31 December | 31 December 2021 | |||||||
2021, | accounting | for | ||||||
US$'000 | ||||||||
approximately | 76.3% | of | the | |||||
Group's total current assets. | Trade receivables (Gross)1 | 10,801 | ||||||
Please disclose: | Unbilled receivables1 | 38 | ||||||
Retention receivable, all current/not due | 1,223 | |||||||
(i) | The aging of the | 12,062 | ||||||
Group's trade | Allowance for doubtful debts, aggregate | |||||||
(891) | ||||||||
receivables; | ||||||||
Net receivables | 11,171 | |||||||
Notes:
1 Aging of Trade Receivables (Gross) and Unbilled Receivables
Allowance | % of | ||||||||
Gross | for doubtful | Net | |||||||
Aging past due | Net | ||||||||
debts | |||||||||
US$'000 | US$'000 | US$'000 | % | ||||||
Current/Not Due | 6,898 | - | 6,898 | 69.3% | |||||
1 - 30 days | 2,120 | - | 2,120 | 21.3% | |||||
31 - 60 days | 434 | - | 434 | 4.4% | |||||
61 - 90 days | 481 | - | 481 | 4.8% | |||||
91-150 days | 223 | (208) | 15 | 0.2% | |||||
> 150 days | 683 | (683) | - | 0.0% | |||||
Total | 10,839 | (891) | 9,948 | 100% | |||||
Trade receivables are generally on 30 days and up to 60 days credit terms. | |||||||||
(ii) | Whether they are major | (ii) Approximately 88.5% of the total trade receivables are related to 5 | |||||||
major customers of the Group, out of which approximately 62.7% of | |||||||||
customer(s) and | |||||||||
these amounts were since paid to-date including those amounts in the | |||||||||
whether the Group | |||||||||
"Current/Not Due" as at 31 December 2021 which are due by now. With | |||||||||
1
SGX RegCo's Queries | Company's Responses | ||
continues to transact | established and current relationships with the Group, the Group intends | ||
with these customer(s); | to continue to transact with these customers. | ||
(iii) | The Group's plan to | (iii) The Group's major customers are predominantly reputable companies | |
recover the trade | including National Oil Companies as well as international and mid-sized | ||
receivables; | contractors with significant established presence in the Middle East | ||
which the Group had worked with over a period of time. The Group | |||
continues to work closely with these companies with relationships | |||
evolving to involve close consultation, with the Group's vessels | |||
earmarked as part of the customers' future planning. The Group does | |||
not foresee any significant difficulties in collection as evident in the | |||
subsequent collections as mentioned 2(i) and 2(ii) above. | |||
(iv) | What were the actions | (iv) | See response to 1(iii) above. |
taken to recover the | |||
trade receivables; | |||
(v) | How long are the debts | (v) | See response on in 1(i) above. |
outstanding; and | |||
(vi) | The Board's | (vi) | On the advice of the management, the Board expects the trade |
assessment of the | receivables net of allowance for doubtful debts as at 31 December | ||
recoverability of the | 2021, to be recoverable. | ||
remaining trade | |||
receivables. | |||
2. The Group recorded | The total loans excluding loans and advances from shareholders comprise of | ||
US$52,682,000 of loans and | US$52,682,000 as current and US$1,248,000 in non-current portion, for total | ||
borrowings as at 31 December | of US$53,930,000 as at 31 December 2021. | ||
2021, accounting for | |||
approximately 75.2% of the | |||
Group's total current liabilities. | |||
Please disclose the following: | |||
(i) | Details of the loans and | For (i) and (ii), please see the Attachment for the details in summary as | |
borrowings, including | requested. Certain information have remained confidential such as the | ||
the terms of loan, | identity of banks as well as the specific loans from which respective banks | ||
interest on loans and | which have not been disclosed previously in view of the commercial | ||
maturity dates; | sensitivities. Details of these loans including interest rates (without identity of | ||
(ii) | A breakdown of the | the banks) are provided in Note 21 of the Financial Statements for the year | |
lenders and their | ended 31 December 2020 in the Annual Report 2020, with similar details to | ||
identities (and its | be disclosed and updated in the Annual Report 2021. | ||
ultimate beneficial | |||
shareholders and | |||
directors if this is not a | |||
bank); | |||
(iii) | When were the loans | (iii) Please see details in the Attachment on inception dates. The loans were | |
obtained and approved | approved by the Board. | ||
by the Board, including | |||
the Audit Committee; | |||
and | |||
(iv) | The use of proceeds | (iv) These loans were procured predominantly for the fulfilment of purchase | |
from the loan. | consideration for vessels acquired or payment to shipyards for new-built | ||
vessels and other capital expenditure for vessel enhancement as required by | |||
charterers and mobilisation. | |||
2
SGX RegCo's Queries | Company's Responses | ||
3. It is disclosed on page 12 of the | The Company refers the announcement made on 23 August 2021 that the | ||
financial report that the Group | impairment loss of US$8,028,000 was recorded for 2Q FY2021. The | ||
recorded US$8,028,000 of | responses continue to be applicable and largely reiterated hereon for ease | ||
impairment loss on 3 three | of reference: | ||
vessels. | |||
Please disclose the following: | |||
(i) | Details of the | (i) | For FY2021 financial results, vessel valuation across the entire fleet |
independent | of vessels was conducted by Cleghorn, Wilton & Associates, Ltd. (the | ||
professional valuers | "Valuer"), established in the UAE in 1979 and it has been the Group's | ||
that conducted the | valuer since its inception. | ||
valuation; | |||
(ii) | The basis and date of | (ii) | The Group engages the Valuer on a semi-annual basis as previously |
such a valuation; and | announced which provides valuations for a view of the market value, | ||
having taken into consideration mainly the vessel's age, size, type | |||
and characteristics, based on a sale between a willing buyer and a | |||
willing seller and its own professional knowledge. Such valuation as | |||
determined being the market value is deemed as the recoverable | |||
amount, and the impairment is determined as the difference between | |||
the recoverable amount and the book value as at 30 June 2021 and | |||
31 December 2021 with no further impairment in second half of | |||
FY2021. | |||
(iii) | The Board's | (iii) | On the advice of the Management, the Board confirms that it is |
confirmation as to | satisfied with the reasonableness of the methodologies used to | ||
whether it is satisfied | determine the amount of impairment. | ||
with the | |||
reasonableness of the | |||
methodologies used by | |||
the valuers to | |||
determine the amount | |||
of impairment. | |||
4. As at 31 December 2021, the | The Group is of the view that its ability to meet its debt repayments should be | ||
Group's current liabilities stand | evaluated from an overall perspective. | ||
at US$70,047,000 with a cash | |||
and bank balances of | As disclosed on page 7 of the Announcement, as at 31 December 2021, while | ||
US$520,000. We also note that | the Group has reported a net current liabilities (current assets less current | ||
there are US$2,462,000 in bank | liabilities) position of US$55,406,000, its net assets (i.e. total assets less total | ||
overdrafts. | liabilities) was US$69,002,000. In addition, the Group's external loans of | ||
US$53.9 million were secured by mortgages of vessels with a carrying value | |||
Please disclose the Board's | of US$133.4 million as at 31 December 2021. Further, | ||
assessment of the following: | |||
(i) | Whether the Group's | (a) The Group is in discussions to sell certain vessel(s) at a reasonable price | |
current assets are | within a reasonable time-frame; | ||
adequate to meet the | (b) | The Group is engaging in ongoing discussions to obtain refinancing | |
Group's short-term | facilities backed by vessels with secured contracts; and | ||
liabilities of | (c) The Group expects cash flows from operations in an improving offshore | ||
US$70,047,000, | market condition in the Middle East. | ||
including its bases of | |||
assessment; | Subsequent to the year end of 2021, following progress updates from the | ||
(ii) | How the Group intends | Group and further discussions, one of the principal banks (the "Relevant | |
to fulfil its significant | Bank") had consented to the Group's request to refinance or repay the | ||
payment obligations in | outstanding secured loans from the sale proceeds by 30 June 2022. | ||
the next 12 months. | |||
Where the Group has | With the ongoing discussions either for substantive sale for loan repayment | ||
worked out debt | or refinancing supported by significant charter party contracts including the | ||
repayment plans to fulfil | firmed 730 operational days, i.e. 2 years, contract and potential sale pursuant | ||
3 |
SGX RegCo's Queries | Company's Responses | |
its debt obligation, | to the call option granted for a liftboat, Delta-22, as announced on 4 March | |
please disclose if the | 2022, the Group is of the view that it is broadly on track to fulfilling these | |
Group is on track to | obligations. | |
fulfilling these | ||
obligations; and | Besides the Delta-22 contracts finalised as announced on 4 March 2022, the | |
(iii) | Please disclose the pro- | other liftboat, as disclosed on page 17 of the Announcement, is currently on |
active actions which the | contract expected to expire by end April 2022. There are a few of ongoing | |
management plans to | proposals being discussed (including extensions with existing charterer) with | |
take to ensure that the | varying charter durations. These charter party agreements when finalised | |
Group's financial | would provide the financial support to and facilitate the discussions for the | |
position remains strong. | intended refinancing or sale. | |
The Group will provide updates to the market when there are material | ||
developments. | ||
In the current improving offshore market, the Group's utilisation rates achieved | ||
were 84.0% in 4Q2021, 76.7% in 3Q2021, with FY2021 at 73.7%. The Group | ||
is focused on and is monitoring closely the ongoing but abating COVID-19 | ||
pandemic as well as Russia/Ukraine conflict and Middle East geopolitical | ||
tension and will be adopting appropriate measures such that its operations are | ||
not materially disrupted to generate the expected cash flow from operations. | ||
By Order of the Board
Wong Siew Cheong
Executive Director and Chief Executive Officer
11 March 2022
This announcement has been reviewed by the Company's sponsor, SAC Capital Private Limited (the "Sponsor"). It has not been examined or approved by the Singapore Exchange Securities Trading Limited (the "SGX-ST") and the SGX-ST assumes no responsibility for the contents of this announcement, including the correctness of any of the statements or opinions made or reports contained in this announcement.
The contact person for the Sponsor is Ms Lee Khai Yinn (Tel: (65) 6232 3210) at 1 Robinson Road, #21-00 AIA Tower, Singapore 048542.
4
Attachment - Query 2 | ||||||||||||||||||
Outstanding as at | Loan Duration | |||||||||||||||||
No | Item | 31 December 2021 | Maturity | Interest rates | ||||||||||||||
from Inception | ||||||||||||||||||
US$'000 | ||||||||||||||||||
1 | UAE Bank, various loans including | 12,985 | 7.5 years from | October 2025 | Both these outstanding loans hedged | |||||||||||||
overdraft facility, in aggregate | April 2018 | to fixed interest cost at 8.0% per | ||||||||||||||||
US$34,711,000 with loan duration | annum ("p.a.") | |||||||||||||||||
between 3.5 and 7.5 years | 6,024 | 7.0 years from | October 2026 | |||||||||||||||
November 2019 | ||||||||||||||||||
7,572 | 5.5 years from | May 2025 | 4.0% p.a. + 1-month LIBOR | |||||||||||||||
November 2019 | ||||||||||||||||||
5,668 | 3.5 years from | June 2025 | 4.0% p.a. + 1-month LIBOR, subject to | |||||||||||||||
December 2021 | minimum interest rate of 5.5% p.a. | |||||||||||||||||
2,462 (overdraft, | Since March | Progressive reduction from | 5.0% p.a. + 1-month EIBOR, subject to | |||||||||||||||
limit at US$2.6 | 2019 | January 2023 until expiry in | minimum interest rate of 5.5% p.a. | |||||||||||||||
million) | March 2026 | |||||||||||||||||
2 | Relevant Bank, various loans | 17,948 | 6 years as | April 2023 | 4.0% + 1-month LIBOR, additional | |||||||||||||
extended, | 1.0% for amounts in arrears; consent | |||||||||||||||||
effective from | granted for refinancing or sale of | |||||||||||||||||
April 2017 | assets for repayment by 30 June 2022 | |||||||||||||||||
3 | Mr Mubarak Abdullah Al-Suwaiket, | 1,218 | 5 years from | Repayable in March 2023 | 10.0% p.a. fixed | |||||||||||||
i.e. country representative in the | March 2018 | |||||||||||||||||
Middle East (See announcement | ||||||||||||||||||
dated 6 April 2018) | ||||||||||||||||||
4 | Car loan | 53 | 4 years from | June 2024 | 7.45% p.a. fixed | |||||||||||||
June 2020 | ||||||||||||||||||
Total loan | 53,930 | |||||||||||||||||
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Atlantic Navigation Holdings (Singapore) Ltd. published this content on 11 March 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 March 2022 08:43:04 UTC.