Jinhui to reach agreement over debt restructuring before end-2016

Jinhui, which operates its dry bulk shipping activities through Jinhui Shipping and Transportation Limited, confirmed that a principal agreement reached with majority of its lenders will be concluded before the end of the year.

In May, Jinhui announced it had initiated restructuring arrangement talks with its creditors and that an agreement on the key and critical terms of rescheduling of indebtedness with majority of its lenders are at the documentation stage.

Meanwhile, Jinhui posted a third quarter loss of $28.51m compared to the deficit of $32.39m in the same period of last year.

Revenue for the quarter ended 30 September 2016 dipped to $19m from $24.17m in the year-ago period, due mainly to Jinhui Shipping’s large exposure to the spot market as freight rates remained low.

Over the first nine months of this year, Jinhui disposed of a total of seven bulk carriers – five supramaxes, one panamax and one handymax – in order to enhance its working capital position and strengthen its liquidity.

As at 29 November 2016, the group had 28 owned vessels comprising 25 supramaxes, two post-panamaxes and one handysize.

Looking ahead, Jinhui believed the current trough market cannot be sustainable in the long term, but the journey to recovery and equilibrium will continue to be tough and challenging.

“Many shipowners are running out of liquidity for their operations and not to mention, for any outstanding capex requirements,” the company commented.

“Financiers seem to have had enough on this front, and have been avoiding additional exposure to the sector. Asset based financing, in particular with respect to maritime assets will be harder and harder to come by going forward under new global banking regulatory requirements,” it said.