In a statement to the Singapore Exchange late evening on 10 April the company said it “assessing the impact of the recent sharp deterioration of the dry bulk shipping market which has led to a reduction in freight rates and further declines in dry bulk asset values”.
It warned as a result these could, “impact company’s cash flows, financial position and certain covenants under loan facilities”.
Mercator said it had appointed an independent financial advisor “to assist with an assessment
of its financial position and to advise and assist, as appropriate, with the options available to the company with respect to its financial affairs”.
The Baltic Dry Index dropped to an all time low of 509 points in February and remains depressed closing at 580 points on 10 April.
Mercator reported a nine-month loss of $20.9m for the nine month period ended 31 December 2014.