Pacific International Lines (PIL), the embattled Singaporean liner operator, said that market conditions remain challenging and expenditure must continue to be controlled.
In a filing to the Singapore Exchange on 30 July PIL disclosed that it will receive interim funding of US$112 million from Heliconia Capital. The funds, said PIL, are to be used only to meet urgent operational requirements, while negotiations with Heliconia, a unit of the Singapore government’s investment company Temasek Holdings, continue for more funding. PIL added that the negotiations are progressing well, and it is still in discussions with lenders and other stakeholders to restructure its debts.
PIL said, “Notwithstanding the progress achieved in negotiations with Heliconia, the board cautions that the company still needs to closely manage its expenditure going forward, especially in the light of the uncertain operational environment and continued challenges posed by the Covid-19 pandemic.”
PIL’s losses had narrowed to a net loss of US$65 million the first half of 2019, compared with US$141.18 million in H1 2018. The company is delaying the release of its 2019 financial statements until the bailout discussions are completed. As at 30 June 2019, PIL, which had equity of US$1.59 billion, had US$1.82 billion of liabilities, of which nearly US$1.07 billion was repayable in a year.
PIL has been doing all it can to self-rescue, including exiting the Transpacific trade, selling a subsidiary, Pacific Direct Line, and a number of ships. And last week, it was reported that PIL was considering the sale of its headquarters, although a company representative clarified to Container News that PIL does not have immediate plans to sell the building.
The representative said, “The intent of the expressions of interest (EOI) exercise is to better assess the current market value of the building. There is no direct relationship between the exercise and our on-going discussion with Heliconia.”
PIL also sought to assure customers that the company is well-positioned to maintain its current services.