Klaipeda Court Launches Lithuanian Shipping’s Bankruptcy Proceedings

Image Courtesy: Lithuanian Shipping

Regional Court of Klaipeda has initiated the bankruptcy proceedings of PC Lithuanian Shipping Company. The decision comes into force 10 days after its adoption.

The move comes following the company’s application for bankruptcy filed on November 27th by the company’s general director Sigitas Dobilinskas.

This was the second time in less than six months that the company has filed for bankruptcy. Namely, on July 23rd the Ministry of Transport and Communications of the Republic of Lithuania applied to the Klaipėda court to initiate the company’s bankruptcy proceedings.

Just a week after the announcement, the Ministry decided to withdraw the application following an agreement with the AB SEB bank on a credit of EUR 3 million (USD 3.3 million), thus dodging bankruptcy.

The state-owned company which employs 237 workers has been piling up losses since 2008, and the accumulated loss currently stands at EUR 20 million. The company’s inability to pay its debts led to several arrests of its vessels by different claimants.

For the nine-month period of 2015, the company reported income of EUR 8.1 million (USD 8.94 million), slashed from last year’s EUR 15.5 million by 48%.

At the end of 30 September, 2015, LSC had 5 ships also down from last year’s 8 ships.

EBITDA during the period was EUR -3.6 million against EUR 0.4 million reported in the corresponding period last year.

The company‘s operating losses during January–September, 2015 amounted to EUR 7.3 million, up from EUR 4.6 million in 2014.