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Singapore’s Big Winner for the Week: Mercator Lines (Singapore) Ltd

Since last Friday, Mercator Lines (Singapore) Ltd (SGX: EE6) has gained around 16% to close at S$0.089 on Wednesday, which was also Christmas Eve. This makes the share one of Singapore’s big winners in the holiday-shortened week as the Straits Times Index (SGX: ^STI) has moved up by only 2% during the same period.

Mercator, which is owned by an India-based energy conglomerate, is a shipping firm that is involved in the dry bulk transport market, specializing in the transportation of dry bulk commodities such as coal, iron ore, and grains. It clients include global commodity powerhouses like Rio Tinto, Arcelor Mittal, Tata Power, Louis Dreyfus and also Noble Group Limited (SGX: N21).

Earlier this month, the firm said that it had undertaken a voluntary dissolution of Mercator Lines (Panama) Inc., a dormant subsidiary. The reason for the dissolution was to rationalize the corporate structure of the company and its subsidiaries.

For the six months ended 30 September 2014, revenue at Mercator was at US$30.9 million, a drop from US$35.3 million seen a year ago. The top-line decline was mainly due to new contracts that were secured at prices lower than previous rates. Consequently, the company saw a net loss of US$13.4 million – a year ago, the net loss for the same period was US$12.1 million.

Mr. Shalabh Mittal, Managing Director and Chief Executive Officer of Mercator, commented on the quarter’s results:

The Company would continue to monitor the market scenario closely and would take all appropriate steps pro-actively required to overcome the challenging market environment. The Company is also exploring various fund raising options.”

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn't own shares in any company mentioned.