Eagle Bulk Shipping Inc. (NYSE: EGLE) (“Eagle” or the “Company”),
one of the world’s largest owner-operators within the midsize
drybulk vessel segment, today reported financial results for the
quarter ended September 30, 2023.
Quarter Highlights:
- Generated Revenues, net of $82.6
million
- Achieved TCE(1) of $11,482 based on
TCE Revenue(1) of $54.1 million
- Incurred a net loss of $5.2
million, or $0.55 per basic share
- Adjusted net loss(1) of $2.9
million, or $0.31 per basic share(1)
- Generated Adjusted EBITDA(1) of
$15.6 million
- Completed the sale of the Sankaty
Eagle, a non-core, non-scrubber-fitted Supramax bulkcarrier
- Declared a quarterly dividend of
$0.10 per share for the third quarter of 2023
- Dividend is payable on
November 22, 2023 to shareholders of record at the close of
business on November 14, 2023
1 These are non-GAAP financial measures. A
reconciliation of GAAP to non-GAAP financial measures has been
provided in the financial tables included in this press release. An
explanation of these measures and how they are calculated are also
included below under the heading “Supplemental Information -
Non-GAAP Financial Measures.”
Recent Developments:
- Coverage position for the fourth
quarter of 2023 is as follows:
- 68% of owned available days fixed
at an average TCE of $15,655
Eagle’s CEO Gary Vogel commented, “Although our
financial results for the third quarter are reflective of the
headwinds faced by the broader industry, we were able to once again
outperform the BSI (Baltic Supramax Index) by 14%, achieving a net
TCE of $11,482. Specifically, market fundamentals remained
challenging during the quarter, with the BSI averaging just over
$10,000 for the period.
Freight rates bottomed as we moved through the
quarter, with September benefiting from a strong rally as the index
reached almost $15,000. The Atlantic market was the main driver for
this recovery in rates, catalyzed by robust exports of soybeans and
corn out of Brazil following this season’s record crop. Looking
ahead to the fourth quarter, spot rates have come off from their
recent highs, but remain supported with the BSI averaging
approximately $13,700 quarter-to-date. Further, as of today, we
have fixed approximately 68% of our owned available days, at a net
TCE of $15,655.
During the quarter, we continued to focus on
operational efficiencies and improvements. Our OPEX costs were down
sequentially for the third quarter in a row and Eagle’s entire
fleet is now leveraging SoFar Ocean’s advanced voyage optimization
system achieving meaningful fuel and emissions reductions.
We remain positive about the medium-term
prospects for the drybulk industry, particularly given strong
supply side fundamentals, macroeconomic risks notwithstanding. With
a fully modern fleet of 52, predominately scrubber-fitted vessels,
and approximately $170 million in total liquidity, Eagle is
well-positioned to continue to take advantage of opportunities for
the benefit of our stakeholders.”
Fleet Operating Data
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Ownership Days |
|
4,808 |
|
4,831 |
|
14,425 |
|
14,424 |
Owned Available Days |
|
4,708 |
|
4,588 |
|
13,791 |
|
13,599 |
Fleet Development
- Sankaty Eagle, a 2011-built
Supramax (58k DWT)
- Sold in second quarter of 2023 for
$16.4 million and delivered to new owners in third quarter of
2023
- Owned fleet totals 52 vessels (96%
scrubber-fitted) with an average age of 10.0 years
Results of Operations for the
three and nine months ended
September 30, 2023 and
2022
For the three months ended September 30,
2023, the Company reported a net loss of $5.2 million, or basic and
diluted net loss per share of $0.55. In the comparable quarter of
2022, the Company reported net income of $77.2 million, or basic
and diluted net income per share of $5.94 and $4.77,
respectively.
For the three months ended September 30,
2023, the Company reported an adjusted net loss of $2.9 million,
which excludes net unrealized losses on FFAs and bunker swaps of
$2.2 million, or basic and diluted adjusted net loss per share of
$0.31. In the comparable quarter of 2022, the Company reported
adjusted net income of $74.3 million, which excludes net unrealized
gains on FFAs and bunker swaps of $7.1 million and a loss on debt
extinguishment of $4.2 million, or basic and diluted adjusted net
income per share of $5.72 and $4.58, respectively.
For the nine months ended September 30,
2023, the Company reported net income of $16.1 million, or basic
and diluted net income per share of $1.38 and $1.36, respectively.
For the nine months ended September 30, 2022, the Company
reported net income of $224.7 million, or basic and diluted net
income per share of $17.31 and $13.86, respectively.
For the nine months ended September 30,
2023, the Company reported adjusted net income of $17.2 million,
which excludes net unrealized losses on FFAs and bunker swaps of
$0.4 million and impairment of operating lease right-of-use assets
of $0.7 million, or basic and diluted adjusted net income per share
of $1.47 and $1.44, respectively. For the nine months ended
September 30, 2022, the Company reported adjusted net income
of $220.4 million, which excludes net unrealized gains on FFAs and
bunker swaps of $8.5 million and a loss on debt extinguishment of
$4.2 million, or basic and diluted adjusted net income per share of
$16.97 and $13.59, respectively.
Revenues, net
Revenues, net for the three months ended
September 30, 2023 were $82.6 million compared to $185.3
million for the comparable quarter of 2022. Revenues, net decreased
$102.7 million primarily due to lower rates on both time and voyage
charters, driven by a decline in the drybulk market.
Revenues, net for the nine months ended
September 30, 2023 were $289.2 million compared to $568.4
million for the nine months ended September 30, 2022.
Revenues, net decreased $279.2 million primarily due to lower rates
on both time and voyage charters, driven by a decline in the
drybulk market.
Voyage expenses
Voyage expenses for the three months ended
September 30, 2023 were $23.8 million compared to $40.8
million for the comparable quarter of 2022. Voyage expenses
decreased $17.0 million primarily due to a $15.0 million reduction
in bunker consumption expenses primarily due to decreases in voyage
charters and bunker prices and a $1.2 million decrease in broker
commissions due to lower freight rates driven by a decline in the
drybulk market.
Voyage expenses for the nine months ended
September 30, 2023 were $82.7 million compared to $120.7
million for the nine months ended September 30, 2022. Voyage
expenses decreased $38.0 million primarily due to a $25.4 million
reduction in bunker consumption expenses due to decreases in voyage
charters and bunker prices, a $9.1 million reduction in port
expenses due to a decrease in voyage charters and a $3.5 million
decrease in broker commissions due to lower freight rates driven by
a decline in the drybulk market.
Vessel operating expenses
Vessel operating expenses for the three months
ended September 30, 2023 were $28.8 million compared to $33.1
million for the comparable quarter of 2022. Vessel operating
expenses decreased $4.3 million primarily due to a $2.6 million
decrease in repair costs, a $0.8 million decrease in lube costs
driven by lower purchase volume and a $0.5 million decrease in the
cost of stores and spares driven by lower purchases.
Vessel operating expenses for the nine months
ended September 30, 2023 were $91.1 million compared to $88.2
million for the nine months ended September 30, 2022. Vessel
operating expenses increased $2.9 million primarily due to a $3.2
million increase in crewing costs driven by higher compensation and
increased crew changes as a result of crewing manager transitions
and a $1.4 million increase in costs driven by certain repairs and
discretionary spending on upgrades to six vessels, including newly
acquired ships, partially offset by a $1.3 million decrease in lube
costs driven by lower purchase volume and a $0.4 million decrease
in the cost of stores and spares driven by lower purchases.
Adjusted vessel operating expenses(2), which
excludes one-time, non-recurring expenses related to vessel
acquisitions, charges relating to a change in the crewing manager
on some of the Company’s vessels and discretionary hull and hold
upgrades for the three months ended September 30, 2023 were
$28.5 million compared to $31.7 million for the comparable quarter
in 2022. Adjusted vessel operating expenses decreased $3.2 million
primarily due to a $1.5 million decrease in repair costs, a $0.8
million decrease in lube costs driven by lower purchase volume and
a $0.5 million decrease in the cost of stores and spares driven by
lower purchases. Average daily adjusted vessel operating
expenses(1) (“Adjusted DVOE”) for the three months ended
September 30, 2023 were $5,922 compared to $6,566 for the
comparable quarter in 2022.
Adjusted vessel operating expenses(2), which
excludes one-time, non-recurring expenses related to vessel
acquisitions, charges relating to a change in the crewing manager
on some of the Company’s vessels and discretionary hull and hold
upgrades for the nine months ended September 30, 2023 were
$87.5 million compared to $86.4 million for the nine months ended
September 30, 2022. Adjusted vessel operating expenses
increased $1.1 million primarily due to a $2.6 million increase in
crewing costs driven by higher compensation, a $1.3 million
increase in repair costs, partially offset by a $1.6 million
decrease in lube costs driven by lower purchase volume and a $0.4
million decrease in the cost of stores and spares driven by lower
purchases. Adjusted DVOE for the nine months ended
September 30, 2023 were $6,068 compared to $5,991 for the nine
months ended September 30, 2022.
2 This is a non-GAAP financial measure. A
reconciliation of GAAP to non-GAAP financial measures has been
provided in the financial tables included in this press release. An
explanation of this measure and how it is calculated is also
included below under the heading “Supplemental Information -
Non-GAAP Financial Measures.”
Charter hire expenses
Charter hire expenses for the three months ended
September 30, 2023 were $6.9 million compared to $19.8 million
for the comparable quarter of 2022. Charter hire expenses decreased
$12.9 million primarily due to decreases in both charter hire rates
as a result of a decline in the drybulk market and chartered-in
days.
Charter hire expenses for the nine months ended
September 30, 2023 were $31.0 million compared to $63.8
million for the nine months ended September 30, 2022. Charter
hire expenses decreased $32.8 million primarily due to decreases in
both charter hire rates as a result of a decline in the drybulk
market and chartered-in days.
Chartered-in days, which is the aggregate number
of days in a period during which the Company chartered-in vessels,
for the three months ended September 30, 2023 and 2022 were
589 and 1,000, respectively. Chartered-in days for the nine months
ended September 30, 2023 and 2022 were 2,315 and 3,102,
respectively.
Depreciation and amortization
Depreciation and amortization for the three
months ended September 30, 2023 was $15.5
million compared to $15.4 million for the comparable quarter
of 2022. Depreciation and amortization increased $0.1 million
primarily due to a $0.8 million increase in depreciation from the
net impact of vessels acquired and sold during the respective
periods and a $0.1 million increase in deferred drydocking cost
amortization due to higher drydocking expenditures, partially
offset by $0.9 million decrease in depreciation due to a change in
our estimated vessel scrap value from $300 per lwt to $400 per lwt,
effective January 1, 2023.
Depreciation and amortization for the nine
months ended September 30, 2023 was $45.0 million compared to
$45.2 million for the nine months ended September 30, 2022.
Depreciation and amortization decreased $0.2 million primarily due
to a $2.9 million decrease in depreciation due to a change in our
estimated vessel scrap value from $300 per lwt to $400 per lwt,
effective January 1, 2023, partially offset by a $1.6 million
increase in depreciation from the net impact of vessels acquired
and sold during the respective periods, a $0.7 million increase in
deferred drydocking cost amortization due to higher drydocking
expenditures and a $0.3 million increase in depreciation from an
increase in installed vessel improvements.
General and administrative expenses
General and administrative expenses for the
three months ended September 30, 2023 were $10.7 million
compared to $9.7 million for the comparable quarter of 2022.
Excluding stock-based compensation expense of $1.7 million and $1.4
million for the three months ended September 30, 2023 and
2022, respectively, general and administrative expenses for the
three months ended September 30, 2023 were $9.0 million
compared to $8.2 million for the comparable quarter of 2022.
General and administrative expenses increased $1.0 million
primarily due to a $0.6 million increase in professional fees and a
$0.2 million increase in stock-based compensation expense.
General and administrative expenses for the nine
months ended September 30, 2023 were $32.9 million compared to
$29.6 million for the nine months ended September 30, 2022.
Excluding stock-based compensation expense of $5.7 million and $4.5
million for the nine months ended September 30, 2023 and 2022,
respectively, general and administrative expenses for the nine
months ended September 30, 2023 were $27.2 million compared to
$25.1 million for the nine months ended September 30, 2022.
General and administrative expenses increased $3.3 million
primarily due to a $1.1 million increase in stock-based
compensation expense, a $1.1 million increase in employee-related
costs and other small increases across professional fees, corporate
travel and office expenses.
Other operating expense
Other operating expense for the three months
ended September 30, 2023 and 2022 was $0.7 million and $2.5
million, respectively. Other operating expense for the three months
ended September 30, 2023 was primarily comprised of costs related
to a 2021 U.S. government investigation into an allegation that one
of our vessels may have improperly disposed of ballast water that
entered the engine room bilges during a repair. Other operating
expense for the three months ended September 30, 2022 was
primarily comprised of costs associated with a corporate
transaction that did not materialize.
Other operating expense for each of the nine
months ended September 30, 2023 and 2022 was $0.9 million and
$2.6 million, respectively. Other operating expense for the nine
months ended September 30, 2023 was primarily comprised of costs
related to a 2021 U.S. government investigation into an allegation
that one of our vessels may have improperly disposed of ballast
water that entered the engine room bilges during a repair. Other
operating expense for the nine months ended September 30, 2022
was primarily comprised of costs associated with a corporate
transaction that did not materialize.
Gain on sale of vessels
For the three months ended September 30,
2023, the Company recorded a gain on the sale of the vessel Sankaty
Eagle of $4.9 million. For the three months ended
September 30, 2022, the Company recorded a gain on the sale of
the vessel Cardinal of $9.3 million.
For the nine months ended September 30,
2023, the Company recorded a gain on the sale of the vessels
Jaeger, Montauk Eagle, Newport Eagle and Sankaty Eagle of $19.7
million. For the nine months ended September 30, 2022, the
Company recorded a gain on the sale of the vessel Cardinal of $9.3
million.
Interest expense
Interest expense for the three months ended
September 30, 2023 and 2022 was $7.7 million and
$4.2 million, respectively. Interest expense increased $3.5
million due to the impact of increased amounts outstanding under
the Global Ultraco Debt Facility and higher interest rates.
Interest expense for the nine months ended
September 30, 2023 and 2022 was $16.0 million and
$13.0 million, respectively. Interest expense increased $3.0
million primarily due to the impact of increased amounts
outstanding under the Global Ultraco Debt Facility and higher
interest rates.
Interest income
Interest income for the three months ended
September 30, 2023 and 2022 was $1.5 million and
$0.9 million, respectively. Interest income increased
primarily due to higher interest rates on the Company’s cash
balances.
Interest income for the nine months ended
September 30, 2023 and 2022 was $5.1 million and $1.1 million,
respectively. Interest income increased primarily due to higher
interest rates on the Company’s cash balances.
Realized and unrealized loss/(gain) on
derivative instruments, net
Realized and unrealized loss/(gain) on
derivative instruments, net for the three months ended
September 30, 2023 was a loss of $0.1 million compared to a
gain of $11.3 million for the comparable quarter of 2022. The $11.4
million decrease was due to market movements as well as lower FFA
and bunker swap activity.
Realized and unrealized loss/(gain) on
derivative instruments, net for the nine months ended
September 30, 2023 was a gain of $2.3 million compared to a
gain of $13.3 million for the nine months ended September 30,
2022. The $11.0 million decrease was due to market movements as
well as lower FFA and bunker swap activity.
A summary of outstanding FFAs as of
September 30, 2023 is as follows:
FFA Period |
|
Average FFA Contract Price |
|
Number of Days Hedged |
Quarter ending December 31, 2023 - Buy Positions |
|
$ |
14,196 |
|
|
|
(345 |
) |
Quarter ending December 31, 2023 - Sell Positions |
|
$ |
12,922 |
|
|
|
1,380 |
|
Liquidity and Capital
Resources
|
|
Nine Months Ended |
($ in thousands) |
|
September 30, 2023 |
|
September 30, 2022 |
Net cash provided by operating activities |
|
$ |
35,965 |
|
|
$ |
242,491 |
|
Net cash (used in)/provided by investing activities |
|
|
(27,831 |
) |
|
|
4,090 |
|
Net cash used in financing activities |
|
|
(81,434 |
) |
|
|
(135,198 |
) |
Net (decrease)/increase in cash, cash equivalents and restricted
cash |
|
|
(73,300 |
) |
|
|
111,383 |
|
Cash, cash equivalents and restricted cash at beginning of
period |
|
|
189,754 |
|
|
|
86,222 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
116,454 |
|
|
$ |
197,605 |
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities for
the nine months ended September 30, 2023 was $36.0 million,
compared to $242.5 million for the nine months ended
September 30, 2022. The decrease is primarily due to a
decrease in net income driven by lower freight rates.
Net cash used in investing activities for the
nine months ended September 30, 2023 was $27.8 million,
compared to net cash provided by investing activities of $4.1
million for the nine months ended September 30, 2022. During
the nine months ended September 30, 2023, the Company paid (i)
$81.8 million to purchase three vessels and other vessel
improvements, (ii) $2.1 million to purchase BWTS and (iii) $0.7
million to purchase other fixed assets. These uses of cash were
partially offset by $56.6 million in net proceeds from the sale of
four vessels. During the nine months ended September 30, 2022,
the Company received net proceeds of $14.9 million from the sale of
one vessel and paid (i) $5.7 million to purchase BWTS, (ii) $4.1
million as an advance for the purchase of a vessel, (iii) $0.8
million to purchase vessel improvements and (iv) $0.3 million to
purchase other fixed assets.
Net cash used in financing activities for the
nine months ended September 30, 2023 was $81.4 million,
compared to $135.2 million for the nine months ended
September 30, 2022. During the nine months ended
September 30, 2023, the Company (i) paid $222.7 million to
repurchase Common Stock, inclusive of fees, (ii) repaid $37.4
million of term loan under the Global Ultraco Debt Facility, (iii)
paid $15.8 million in dividends and (iv) paid $2.0 million for
taxes related to net share settlement of equity awards. These uses
of cash were partially offset by (i) $123.4 million of proceeds,
net of debt issuance costs, from the Revolving Facility under the
Global Ultraco Debt Facility and (ii) $73.1 million of proceeds,
net of debt issuance costs, from the Term Facility under the Global
Ultraco Debt Facility. During the nine months ended
September 30, 2022, the Company (i) paid $81.6 million in
dividends, (ii) repaid $37.4 million of term loan under the Global
Ultraco Debt Facility, (iii) paid $14.2 million to repurchase $10.0
million in aggregate principal amount of Convertible Bond Debt, and
(iv) paid $2.4 million for taxes related to net share settlement of
equity awards.
As of September 30, 2023, cash and cash
equivalents including noncurrent restricted cash was $116.5 million
compared to $189.8 million as of December 31, 2022.
A summary of the Company’s debt as of
September 30, 2023 and December 31, 2022 is as
follows:
|
|
September 30, 2023 |
|
December 31, 2022 |
($ in thousands) |
|
Principal Amount Outstanding |
|
Debt Discounts and Debt Issuance Costs |
|
Carrying Value |
|
Principal Amount Outstanding |
|
Debt Discounts and Debt Issuance Costs |
|
Carrying Value |
Convertible Bond Debt |
|
$ |
104,119 |
|
|
$ |
(328 |
) |
|
$ |
103,791 |
|
|
$ |
104,119 |
|
|
$ |
(620 |
) |
|
$ |
103,499 |
|
Global Ultraco Debt Facility -
Term Facility |
|
|
275,400 |
|
|
|
(5,778 |
) |
|
|
269,622 |
|
|
|
237,750 |
|
|
|
(6,767 |
) |
|
|
230,983 |
|
Global Ultraco Debt Facility -
Revolving Facility |
|
|
125,000 |
|
|
|
(2,941 |
) |
|
|
122,059 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total debt |
|
|
504,519 |
|
|
|
(9,047 |
) |
|
|
495,472 |
|
|
|
341,869 |
|
|
|
(7,387 |
) |
|
|
334,482 |
|
Less: Current portion –
Convertible Bond Debt |
|
|
(104,119 |
) |
|
|
328 |
|
|
|
(103,791 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Less: Current portion - Global
Ultraco Debt Facility |
|
|
(49,800 |
) |
|
|
— |
|
|
|
(49,800 |
) |
|
|
(49,800 |
) |
|
|
— |
|
|
|
(49,800 |
) |
Total long-term debt |
|
$ |
350,600 |
|
|
$ |
(8,719 |
) |
|
$ |
341,881 |
|
|
$ |
292,069 |
|
|
$ |
(7,387 |
) |
|
$ |
284,682 |
|
(1 |
) |
As of September 30, 2023 and December 31, 2022, the
undrawn revolving facility under the Global Ultraco Debt Facility
was $55 million and $100 million, respectively. |
As of September 30, 2023, the effective
conversion price of the Convertible Bond Debt equals $31.70 per
share of Common Stock. If the market value of the Company’s Common
Stock remains above this price, we would expect the holders of the
Convertible Bond Debt to elect conversion prior to maturity. Upon
conversion of the remaining Convertible Bond Debt, the Company will
pay or deliver, as the case may be, either cash, shares of Common
Stock or a combination of cash and shares of Common Stock, at the
Company’s election, to the holder (subject to shareholder approval
requirements in accordance with the indenture that governs the
Convertible Bond Debt).
The Company continuously evaluates potential
transactions that it expects to be accretive to earnings, enhance
shareholder value or are in the best interests of the Company,
including without limitation, business combinations, the
acquisition of vessels or related businesses, repayment or
refinancing of existing debt, the issuance of new securities, share
and debt repurchases or other transactions.
Capital Expenditures and
Drydocking
Our capital expenditures primarily relate to the
purchase of vessels as well as regularly scheduled drydocking and
other vessel improvements, which are expected to enhance their
revenue earning capabilities, efficiency and/or safety and to
comply with international shipping standards and environmental laws
and regulations. Certain vessel improvement costs and costs
incurred in connection with drydocking are necessary to comply with
international shipping standards and environmental laws and
regulations, while others are discretionary in nature and evaluated
on a business case-by-case basis.
During the fourth quarter of 2022, the Company
entered into a memorandum of agreement to acquire a
high-specification 2015-built Ultramax bulkcarrier for total
consideration of $24.3 million. The vessel was delivered to the
Company during the first quarter of 2023.
On January 30, 2023, the Company entered into a
memorandum of agreement to acquire a high-specification 2020-built
scrubber-fitted Ultramax bulkcarrier for total consideration of
$30.1 million. The vessel was delivered to the Company during the
second quarter of 2023.
On February 28, 2023, the Company entered into a
memorandum of agreement to acquire a high-specification 2020-built
scrubber-fitted Ultramax bulkcarrier for total consideration of
$30.1 million. The vessel was delivered to the Company during the
second quarter of 2023.
Although the Company has some flexibility
regarding the timing of vessel drydockings, the timing of costs are
relatively predictable. In accordance with statutory requirements,
we expect vessels less than 15 years old to be drydocked every 60
months and vessels older than 15 years to be drydocked every 30
months. We intend to fund drydocking costs with cash from
operations, cash on hand or with amounts available under the Global
Ultraco Debt Facility. In addition, drydocking typically requires
us to reposition vessels from a discharge port to shipyard
facilities, which will reduce our owned available days and revenues
during that period.
Drydocking costs incurred are deferred and
amortized through depreciation and amortization on the condensed
consolidated statements of operations on a straight-line basis over
the period through the date the next drydocking is required to
become due. During the nine months ended September 30, 2023,
five of our vessels completed drydock and we incurred $10.6 million
for drydocking costs. During the nine months ended
September 30, 2022, eight of our vessels completed drydock and
we incurred $18.5 million for drydocking costs.
Vessel improvements generally include systems
and equipment intended to enhance a vessel’s efficiency and revenue
earning capability. We intend to fund these costs through cash from
operations, cash on hand or amounts available under the Global
Ultraco Debt Facility.
The following table provides certain information about the
estimated costs for anticipated vessel drydockings and improvements
in the next four quarters, along with the anticipated off-hire
days:
|
|
Projected Costs (1) ($ in
millions) |
Quarters Ending |
|
Off-hire Days(2) |
|
Drydocks |
|
Vessel Improvements(3) |
December 31, 2023 |
|
224 |
|
$ |
4.1 |
|
$ |
1.8 |
March 31, 2024 |
|
232 |
|
$ |
4.7 |
|
$ |
0.8 |
June 30, 2024 |
|
143 |
|
$ |
2.0 |
|
$ |
0.4 |
September 30, 2024 |
|
165 |
|
$ |
2.4 |
|
$ |
— |
(1 |
) |
We intend to fund these costs with cash from operations, cash on
hand or with amounts available under the Global Ultraco Debt
Facility. |
(2 |
) |
Actual duration of off-hire days will vary based on the age and
condition of the vessel, yard schedules and other factors.
Projected off-hire days includes an allowance for unforeseen
events. |
(3 |
) |
Projected costs for vessel improvements are primarily comprised of
costs for ballast water treatment systems (“BWTS”). |
SUMMARY CONSOLIDATED FINANCIAL AND OTHER
DATA
The following table summarizes the Company’s
selected condensed consolidated financial statements and other data
for the periods indicated below.
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)(in thousands, except share and per
share data) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Revenues, net |
|
$ |
82,606 |
|
|
$ |
185,313 |
|
|
$ |
289,210 |
|
|
$ |
568,406 |
|
|
|
|
|
|
|
|
|
|
Voyage expenses |
|
|
23,791 |
|
|
|
40,792 |
|
|
|
82,737 |
|
|
|
120,710 |
|
Vessel operating expenses |
|
|
28,822 |
|
|
|
33,091 |
|
|
|
91,077 |
|
|
|
88,213 |
|
Charter hire expenses |
|
|
6,868 |
|
|
|
19,772 |
|
|
|
31,014 |
|
|
|
63,768 |
|
Depreciation and
amortization |
|
|
15,472 |
|
|
|
15,407 |
|
|
|
45,035 |
|
|
|
45,241 |
|
General and administrative
expenses |
|
|
10,652 |
|
|
|
9,666 |
|
|
|
32,871 |
|
|
|
29,611 |
|
Impairment of operating lease
right-of-use assets |
|
|
— |
|
|
|
— |
|
|
|
722 |
|
|
|
— |
|
Other operating expense |
|
|
677 |
|
|
|
2,469 |
|
|
|
860 |
|
|
|
2,643 |
|
Gain on sale of vessels |
|
|
(4,855 |
) |
|
|
(9,336 |
) |
|
|
(19,731 |
) |
|
|
(9,336 |
) |
Total operating expenses, net |
|
|
81,427 |
|
|
|
111,861 |
|
|
|
264,585 |
|
|
|
340,850 |
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
1,179 |
|
|
|
73,452 |
|
|
|
24,625 |
|
|
|
227,556 |
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
7,714 |
|
|
|
4,236 |
|
|
|
16,005 |
|
|
|
13,021 |
|
Interest income |
|
|
(1,488 |
) |
|
|
(881 |
) |
|
|
(5,139 |
) |
|
|
(1,100 |
) |
Realized and unrealized
loss/(gain) on derivative instruments, net |
|
|
104 |
|
|
|
(11,293 |
) |
|
|
(2,318 |
) |
|
|
(13,281 |
) |
Loss on debt
extinguishment |
|
|
— |
|
|
|
4,173 |
|
|
|
— |
|
|
|
4,173 |
|
Total other expense/(income), net |
|
|
6,330 |
|
|
|
(3,765 |
) |
|
|
8,548 |
|
|
|
2,813 |
|
Net (loss)/income |
|
$ |
(5,151 |
) |
|
$ |
77,217 |
|
|
$ |
16,077 |
|
|
$ |
224,743 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
9,313,051 |
|
|
|
12,993,450 |
|
|
|
11,686,433 |
|
|
|
12,985,329 |
|
Diluted |
|
|
9,313,051 |
|
|
|
16,201,852 |
|
|
|
15,057,652 |
|
|
|
16,219,264 |
|
|
|
|
|
|
|
|
|
|
Per share amounts: |
|
|
|
|
|
|
|
|
Basic net (loss)/income |
|
$ |
(0.55 |
) |
|
$ |
5.94 |
|
|
$ |
1.38 |
|
|
$ |
17.31 |
|
Diluted net (loss)/income |
|
$ |
(0.55 |
) |
|
$ |
4.77 |
|
|
$ |
1.36 |
|
|
$ |
13.86 |
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)(in thousands, except share data and
par values) |
|
|
|
September 30, 2023 |
|
December 31, 2022 |
ASSETS: |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
113,879 |
|
|
$ |
187,155 |
|
Accounts receivable, net of a
reserve of $2,933 and $3,169, respectively |
|
|
24,594 |
|
|
|
32,311 |
|
Prepaid expenses |
|
|
5,832 |
|
|
|
4,531 |
|
Inventories |
|
|
26,881 |
|
|
|
28,081 |
|
Collateral on derivatives |
|
|
4,380 |
|
|
|
909 |
|
Fair value of derivative
assets – current |
|
|
8,653 |
|
|
|
8,479 |
|
Other current assets |
|
|
652 |
|
|
|
558 |
|
Total current assets |
|
|
184,871 |
|
|
|
262,024 |
|
Noncurrent
assets: |
|
|
|
|
Vessels and vessel
improvements, at cost, net of accumulated depreciation of $289,819
and $261,725, respectively |
|
|
914,108 |
|
|
|
891,877 |
|
Advances for vessel
purchases |
|
|
— |
|
|
|
3,638 |
|
Advances for BWTS and other
assets |
|
|
1,984 |
|
|
|
2,722 |
|
Deferred drydock costs,
net |
|
|
37,756 |
|
|
|
42,849 |
|
Other fixed assets, net of
accumulated depreciation of $1,324 and $1,623, respectively |
|
|
952 |
|
|
|
310 |
|
Operating lease right-of-use
assets |
|
|
10,892 |
|
|
|
23,006 |
|
Restricted cash –
noncurrent |
|
|
2,575 |
|
|
|
2,599 |
|
Fair value of derivative
assets – noncurrent |
|
|
5,435 |
|
|
|
8,184 |
|
Total noncurrent assets |
|
|
973,702 |
|
|
|
975,185 |
|
Total
assets |
|
$ |
1,158,573 |
|
|
$ |
1,237,209 |
|
LIABILITIES &
STOCKHOLDERS' EQUITY: |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
|
$ |
20,938 |
|
|
$ |
20,129 |
|
Accrued interest |
|
|
2,092 |
|
|
|
3,061 |
|
Other accrued liabilities |
|
|
19,198 |
|
|
|
24,097 |
|
Fair value of derivative
liabilities – current |
|
|
585 |
|
|
|
163 |
|
Current portion of operating
lease liabilities |
|
|
10,109 |
|
|
|
22,045 |
|
Unearned charter hire
revenue |
|
|
8,201 |
|
|
|
9,670 |
|
Current portion of long-term
debt – Global Ultraco Debt Facility |
|
|
49,800 |
|
|
|
49,800 |
|
Current portion of long-term
debt – Convertible Bond Debt, net of debt discount and debt
issuance costs |
|
|
103,791 |
|
|
|
— |
|
Total current liabilities |
|
|
214,714 |
|
|
|
128,965 |
|
Noncurrent
liabilities: |
|
|
|
|
Long-term debt – Global
Ultraco Debt Facility, net of debt discount and debt issuance
costs |
|
|
341,881 |
|
|
|
181,183 |
|
Convertible Bond Debt, net of
debt discount and debt issuance costs |
|
|
— |
|
|
|
103,499 |
|
Fair value of derivative
liabilities – noncurrent |
|
|
444 |
|
|
|
— |
|
Noncurrent portion of
operating lease liabilities |
|
|
2,766 |
|
|
|
3,173 |
|
Other noncurrent accrued
liabilities |
|
|
696 |
|
|
|
1,208 |
|
Total noncurrent liabilities |
|
|
345,787 |
|
|
|
289,063 |
|
Total
liabilities |
|
|
560,501 |
|
|
|
418,028 |
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
Preferred stock, $0.01 par
value, 25,000,000 shares authorized, none issued as of
September 30, 2023 and December 31, 2022 |
|
|
— |
|
|
|
— |
|
Common stock, $0.01 par value,
700,000,000 shares authorized, 9,319,177 and 13,003,702 shares
issued and outstanding as of September 30, 2023 and
December 31, 2022, respectively |
|
|
93 |
|
|
|
130 |
|
Additional paid-in
capital |
|
|
746,898 |
|
|
|
966,058 |
|
Accumulated deficit |
|
|
(162,418 |
) |
|
|
(163,556 |
) |
Accumulated other
comprehensive income |
|
|
13,499 |
|
|
|
16,549 |
|
Total stockholders'
equity |
|
|
598,072 |
|
|
|
819,181 |
|
Total liabilities and
stockholders' equity |
|
$ |
1,158,573 |
|
|
$ |
1,237,209 |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)(in thousands) |
|
|
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
Cash flows from operating
activities: |
|
|
|
|
Net income |
|
$ |
16,077 |
|
|
$ |
224,743 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
Depreciation |
|
|
34,577 |
|
|
|
35,513 |
|
Noncash operating lease
expense |
|
|
17,890 |
|
|
|
21,083 |
|
Amortization of deferred
drydocking costs |
|
|
10,458 |
|
|
|
9,728 |
|
Amortization of debt discount
and debt issuance costs |
|
|
1,958 |
|
|
|
1,627 |
|
Loss on debt
extinguishment |
|
|
— |
|
|
|
4,173 |
|
Impairment of operating lease
right-of-use assets |
|
|
722 |
|
|
|
— |
|
Gain on sale of vessels |
|
|
(19,731 |
) |
|
|
(9,336 |
) |
Unrealized loss/(gain) on
derivative instruments, net |
|
|
437 |
|
|
|
(8,517 |
) |
Stock-based compensation
expense |
|
|
5,680 |
|
|
|
4,542 |
|
Drydocking expenditures |
|
|
(10,562 |
) |
|
|
(18,527 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
Accounts payable |
|
|
1,381 |
|
|
|
650 |
|
Accounts receivable |
|
|
7,707 |
|
|
|
(5,098 |
) |
Accrued interest |
|
|
(969 |
) |
|
|
(1,241 |
) |
Inventories |
|
|
1,199 |
|
|
|
(8,622 |
) |
Operating lease liabilities
current and noncurrent |
|
|
(19,570 |
) |
|
|
(21,076 |
) |
Collateral on derivatives |
|
|
(3,471 |
) |
|
|
13,881 |
|
Fair value of derivatives,
other current and noncurrent assets |
|
|
(141 |
) |
|
|
(183 |
) |
Other accrued liabilities |
|
|
(4,907 |
) |
|
|
(2,332 |
) |
Prepaid expenses |
|
|
(1,301 |
) |
|
|
(1,223 |
) |
Unearned charter hire
revenue |
|
|
(1,469 |
) |
|
|
2,706 |
|
Net cash provided by operating activities |
|
|
35,965 |
|
|
|
242,491 |
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
Purchase of vessels and vessel
improvements |
|
|
(81,802 |
) |
|
|
(781 |
) |
Advances for vessel
purchases |
|
|
— |
|
|
|
(4,125 |
) |
Purchase of BWTS |
|
|
(2,142 |
) |
|
|
(5,695 |
) |
Proceeds from hull and
machinery insurance claims |
|
|
174 |
|
|
|
— |
|
Net proceeds from sale of
vessels |
|
|
56,609 |
|
|
|
14,944 |
|
Purchase of other fixed
assets |
|
|
(670 |
) |
|
|
(253 |
) |
Net cash (used in)/provided by investing
activities |
|
|
(27,831 |
) |
|
|
4,090 |
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
Proceeds from Revolving
Facility, net of debt issuance costs – Global Ultraco Debt
Facility |
|
|
123,361 |
|
|
|
— |
|
Proceeds from Term Facility,
net of debt issuance costs – Global Ultraco Debt Facility |
|
|
73,125 |
|
|
|
— |
|
Repayment of Term Facility –
Global Ultraco Debt Facility |
|
|
(37,350 |
) |
|
|
(37,350 |
) |
Repurchase of Common Stock and
associated fees – related party |
|
|
(222,688 |
) |
|
|
— |
|
Repurchase of Convertible Bond
Debt |
|
|
— |
|
|
|
(14,188 |
) |
Dividends paid |
|
|
(15,790 |
) |
|
|
(81,577 |
) |
Debt issuance costs paid to
lenders – Original Global Ultraco Debt Facility |
|
|
— |
|
|
|
(18 |
) |
Cash paid for taxes related to
net share settlement of equity awards |
|
|
(1,989 |
) |
|
|
(2,351 |
) |
Other financing costs
paid |
|
|
(103 |
) |
|
|
— |
|
Cash received from exercise of
stock options |
|
|
— |
|
|
|
85 |
|
Proceeds from equity
offerings, net of issuance costs |
|
|
— |
|
|
|
201 |
|
Net cash used in financing activities |
|
|
(81,434 |
) |
|
|
(135,198 |
) |
Net (decrease)/increase in
cash, cash equivalents and restricted cash |
|
|
(73,300 |
) |
|
|
111,383 |
|
Cash, cash equivalents and
restricted cash at beginning of period |
|
|
189,754 |
|
|
|
86,222 |
|
Cash, cash equivalents and restricted cash at end of
period |
|
$ |
116,454 |
|
|
$ |
197,605 |
|
|
|
|
|
|
Cash paid for interest |
|
$ |
22,064 |
|
|
$ |
12,861 |
|
|
|
|
|
|
|
|
|
|
Supplemental Information - Non-GAAP
Financial Measures
This release includes various financial measures
that are non-GAAP financial measures as defined under the rules of
the Securities and Exchange Commission (“SEC”). We believe these
measures provide important supplemental information to investors to
use in evaluating ongoing operating results. We use these measures,
together with accounting principles generally accepted in the
United States (“GAAP” or “U.S. GAAP”) measures, for internal
managerial purposes and as a means to evaluate period-to-period
comparisons. However, we do not, and you should not, rely on
non-GAAP financial measures alone as measures of our performance.
We believe that non-GAAP financial measures reflect an additional
way of viewing aspects of our operations, that when taken together
with GAAP results and the reconciliations to corresponding GAAP
financial measures that we also provide and provide a more complete
understanding of factors and trends affecting our business. We
strongly encourage you to review all of our financial statements
and publicly-filed reports in their entirety and to not solely rely
on any single non-GAAP financial measure.
Because non-GAAP financial measures are not
standardized, it may not be possible to compare these financial
measures with other companies’ non-GAAP financial measures, even if
they have similar names.
Non-GAAP Financial Measures
Adjusted net (loss)/income and Basic and Diluted
adjusted net (loss)/income per share
Adjusted net (loss)/income and Basic and Diluted
adjusted net (loss)/income per share represent Net (loss)/income
and Basic and Diluted net (loss)/income per share, respectively, as
adjusted to exclude unrealized gains and losses on FFAs and bunker
swaps, gains and losses on debt extinguishment, and impairment of
operating lease right-of-use assets. The Company utilizes
derivative instruments such as FFAs and bunker swaps to partially
hedge against its underlying long physical position in ships (as
represented by owned and third-party chartered-in vessels). As the
Company does not apply hedge accounting to these derivative
instruments, unrealized mark-to-market gains and losses on forward
hedge positions impact current quarter results, causing timing
mismatches in the Condensed Consolidated Statements of Operations.
Additionally, we believe that gains and losses on debt
extinguishment and impairment of operating lease right-of-use
assets are not representative of our normal business operations. We
believe that Adjusted net (loss)/income and Adjusted net
(loss)/income per share are more useful to analysts and investors
in comparing the results of operations and operational trends
between periods and relative to other peer companies in our
industry. Our Adjusted net (loss)/income should not be considered
an alternative to net income/(loss), operating income/(loss), cash
flows provided by/(used in) operating activities or any other
measure of financial performance or liquidity presented in
accordance with U.S. GAAP. As noted above, our Adjusted net
(loss)/income and Adjusted net (loss)/income per share may not be
comparable to similarly titled measures of another company because
all companies may not calculate Adjusted net (loss)/income or
Adjusted net (loss)/income per share in the same manner.
The following table presents the reconciliation
of our Net (loss)/income to Adjusted net (loss)/income:
|
Reconciliation of GAAP Net
(loss)/income to Adjusted net
(loss)/income(in thousands, except share and per
share data) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Net (loss)/income |
|
$ |
(5,151 |
) |
|
$ |
77,217 |
|
|
$ |
16,077 |
|
$ |
224,743 |
|
Adjustments to reconcile net
(loss)/income to adjusted net (loss)/income: |
|
|
|
|
|
|
|
|
Unrealized loss/(gain) on FFAs and bunker swaps, net |
|
|
2,222 |
|
|
|
(7,124 |
) |
|
|
437 |
|
|
(8,517 |
) |
Impairment of operating lease right-of-use assets |
|
|
— |
|
|
|
— |
|
|
|
722 |
|
|
— |
|
Loss on debt extinguishment |
|
|
— |
|
|
|
4,173 |
|
|
|
— |
|
|
4,173 |
|
Adjusted net
(loss)/income |
|
$ |
(2,929 |
) |
|
$ |
74,266 |
|
|
$ |
17,236 |
|
$ |
220,399 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
9,313,051 |
|
|
|
12,993,450 |
|
|
|
11,686,433 |
|
|
12,985,329 |
|
Diluted (1) |
|
|
9,313,051 |
|
|
|
16,201,852 |
|
|
|
15,057,652 |
|
|
16,219,264 |
|
|
|
|
|
|
|
|
|
|
Per share amounts: |
|
|
|
|
|
|
|
|
Basic adjusted net
(loss)/income |
|
$ |
(0.31 |
) |
|
$ |
5.72 |
|
|
$ |
1.47 |
|
$ |
16.97 |
|
Diluted adjusted net
(loss)/income |
|
$ |
(0.31 |
) |
|
$ |
4.58 |
|
|
$ |
1.44 |
|
$ |
13.59 |
|
(1 |
) |
Diluted weighted average shares outstanding for the three and nine
months ended September 30, 2023 and 2022 includes dilutive
potential common shares related to the Convertible Bond Debt based
on the if-converted method and potential common shares related to
stock awards and options based on the treasury stock method, unless
to do so would have been anti-dilutive to Diluted adjusted net
(loss)/income per share. |
EBITDA and Adjusted EBITDA
We define EBITDA as Net (loss)/income under GAAP
adjusted for interest, income taxes and depreciation and
amortization.
Adjusted EBITDA is a non-GAAP financial measure
that is used as a supplemental financial measure by our management
and by external users of our financial statements, such as
investors, commercial banks and others, to assess our operating
performance as compared to that of other peer companies in our
industry, without regard to financing methods, capital structure or
historical costs basis. Our Adjusted EBITDA should not be
considered an alternative to net income/(loss), operating
income/(loss), cash flows provided by/(used in) operating
activities or any other measure of financial performance or
liquidity presented in accordance with U.S. GAAP. Our Adjusted
EBITDA may not be comparable to similarly titled measures of
another company because all companies may not calculate Adjusted
EBITDA in the same manner. Adjusted EBITDA represents EBITDA
adjusted to exclude certain non-cash, one-time and other items that
the Company believes are not indicative of the ongoing performance
of its core operations such as vessel impairment, gains and losses
on sale of vessels, impairment of operating lease right-of-use
assets, unrealized gains and losses on FFAs and bunker swaps, gains
and losses on debt extinguishment and stock-based compensation
expense.
The following table presents a reconciliation of
our Net (loss)/income to EBITDA and Adjusted EBITDA:
|
Reconciliation of GAAP Net
(loss)/income to EBITDA and Adjusted
EBITDA(in thousands) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Net (loss)/income |
|
$ |
(5,151 |
) |
|
$ |
77,217 |
|
|
$ |
16,077 |
|
|
$ |
224,743 |
|
Adjustments to reconcile net
(loss)/income to EBITDA: |
|
|
|
|
|
|
|
|
Interest expense |
|
|
7,714 |
|
|
|
4,236 |
|
|
|
16,005 |
|
|
|
13,021 |
|
Interest income |
|
|
(1,488 |
) |
|
|
(881 |
) |
|
|
(5,139 |
) |
|
|
(1,100 |
) |
Income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
EBIT |
|
|
1,075 |
|
|
|
80,572 |
|
|
|
26,943 |
|
|
|
236,664 |
|
Depreciation and
amortization |
|
|
15,472 |
|
|
|
15,407 |
|
|
|
45,035 |
|
|
|
45,241 |
|
EBITDA |
|
|
16,547 |
|
|
|
95,979 |
|
|
|
71,978 |
|
|
|
281,905 |
|
Non-cash, one-time and other
adjustments to EBITDA(1) |
|
|
(963 |
) |
|
|
(10,838 |
) |
|
|
(12,892 |
) |
|
|
(9,138 |
) |
Adjusted EBITDA |
|
$ |
15,584 |
|
|
$ |
85,141 |
|
|
$ |
59,086 |
|
|
$ |
272,767 |
|
(1 |
) |
One-time and other adjustments to EBITDA for the three and nine
months ended September 30, 2023 and 2022 includes gains on
sale of vessels, net unrealized losses/(gains) on FFAs and bunker
swaps, impairment of operating lease right-of-use assets, loss on
debt extinguishment and stock-based compensation expense. |
TCE revenue and TCE
Time charter equivalent revenue (“TCE revenue”)
and time charter equivalent (“TCE”) are non-GAAP financial measures
that are commonly used in the shipping industry primarily to
compare daily earnings generated by vessels on time charters with
daily earnings generated by vessels on voyage charters, because
charter hire rates for vessels on voyage charters are generally not
expressed in per-day amounts while charter hire rates for vessels
on time charters generally are expressed in such amounts. The
Company defines TCE revenue as revenues, net less voyage expenses
and charter hire expenses, adjusted for realized gains and losses
on FFAs and bunker swaps and defines TCE as TCE revenue divided by
the number of owned available days. Owned available days is the
number of our ownership days less the aggregate number of days that
our vessels are off-hire due to vessel familiarization upon
acquisition, repairs, vessel upgrades or special surveys. The
shipping industry uses available days to measure the number of days
in a period during which vessels should be capable of generating
revenues. TCE provides additional meaningful information in
conjunction with Revenues, net, the most directly comparable GAAP
measure, because it assists Company management in making decisions
regarding the deployment and use of its vessels and in evaluating
their performance. Our TCE revenue and TCE should not be considered
alternatives to net income/(loss), operating income/(loss), cash
flows provided by/(used in) operating activities or any other
measure of financial performance or liquidity presented in
accordance with U.S. GAAP. Our TCE revenue and TCE may not be
comparable to similarly titled measures of another company because
all companies may not calculate TCE revenue and TCE in the same
manner.
The following table presents the reconciliation
of our Revenues, net to TCE:
|
Reconciliation of Revenues, net to TCE(in
thousands, except for Owned available days and TCE) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Revenues, net |
|
$ |
82,606 |
|
|
$ |
185,313 |
|
|
$ |
289,210 |
|
|
$ |
568,406 |
|
Less: |
|
|
|
|
|
|
|
|
Voyage expenses |
|
|
(23,791 |
) |
|
|
(40,792 |
) |
|
|
(82,737 |
) |
|
|
(120,710 |
) |
Charter hire expenses |
|
|
(6,868 |
) |
|
|
(19,772 |
) |
|
|
(31,014 |
) |
|
|
(63,768 |
) |
Realized gain on FFAs and bunker swaps, net |
|
|
2,118 |
|
|
|
4,169 |
|
|
|
2,755 |
|
|
|
4,764 |
|
TCE revenue |
|
$ |
54,065 |
|
|
$ |
128,918 |
|
|
$ |
178,214 |
|
|
$ |
388,692 |
|
|
|
|
|
|
|
|
|
|
Owned available days |
|
|
4,708 |
|
|
|
4,588 |
|
|
|
13,791 |
|
|
|
13,599 |
|
TCE |
|
$ |
11,482 |
|
|
$ |
28,099 |
|
|
$ |
12,922 |
|
|
$ |
28,582 |
|
Adjusted vessel operating expenses and Adjusted
DVOE
Adjusted vessel operating expenses and Adjusted
DVOE are non-GAAP financial measures that are used as supplemental
financial measures by our management and by external users of our
financial statements to assess our operating performance as
compared to that of other peer companies in our industry. The
Company defines Adjusted vessel operating expenses as vessel
operating expenses presented in accordance with U.S. GAAP, adjusted
to exclude one-time, non-recurring expenses related to vessel
acquisitions, charges relating to a change in the crewing manager
on some of our vessels and discretionary spending associated with
hull and hold upgrades and defines Adjusted DVOE as Adjusted vessel
operating expenses divided by the number of ownership days.
Ownership days is the aggregate number of days in a period during
which each vessel in our fleet has been owned by us. Adjusted
vessel operating expenses and Adjusted DVOE provide additional
meaningful information in conjunction with Vessel operating
expenses, the most directly comparable GAAP measure. Our Adjusted
vessel operating expenses and Adjusted DVOE should not be
considered alternatives to net income/(loss), operating
income/(loss), cash flows provided by/(used in) operating
activities or any other measure of financial performance or
liquidity presented in accordance with U.S. GAAP. Our Adjusted
vessel operating expenses and Adjusted DVOE may not be comparable
to similarly titled measures of another company because all
companies may not calculate Adjusted vessel operating expenses and
Adjusted DVOE in the same manner.
The following table presents the reconciliation
of our Vessel operating expenses to Adjusted vessel operating
expenses and Adjusted DVOE:
|
Reconciliation of GAAP Vessel operating expenses to
Adjusted vessel operating expenses and Adjusted
DVOE(in thousands, except for Ownership days and
Adjusted DVOE data) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
Vessel operating expenses |
|
$ |
28,822 |
|
|
$ |
33,091 |
|
|
$ |
91,077 |
|
|
$ |
88,213 |
|
Less: |
|
|
|
|
|
|
|
|
Adjustments to vessel operating expenses(1): |
|
|
(347 |
) |
|
|
(1,371 |
) |
|
|
(3,548 |
) |
|
|
(1,796 |
) |
Adjusted vessel operating
expenses |
|
$ |
28,475 |
|
|
$ |
31,720 |
|
|
$ |
87,529 |
|
|
$ |
86,417 |
|
|
|
|
|
|
|
|
|
|
Ownership days |
|
|
4,808 |
|
|
|
4,831 |
|
|
|
14,425 |
|
|
|
14,424 |
|
Adjusted DVOE |
|
$ |
5,922 |
|
|
$ |
6,566 |
|
|
$ |
6,068 |
|
|
$ |
5,991 |
|
(1 |
) |
Adjustments to vessel operating expenses includes one-time,
non-recurring expenses related to vessel acquisitions, charges
relating to a change in the crewing manager on some of our vessels
and discretionary spending associated with hull and hold
upgrades. |
Glossary of Terms
Chartered-in days: We define chartered-in days
as the aggregate number of days in a period during which we
charter-in vessels under operating leases. The Company charters-in
vessels on a long-term and short-term basis.
Owned available days: We define owned available
days as the number of ownership days less the aggregate number of
days that our owned vessels are off-hire due to vessel
familiarization upon acquisition, repairs, vessel upgrades or
special surveys and other reasons which prevent the vessel from
performing under a charter party in a period. The shipping industry
uses owned available days to measure the number of days in a period
during which owned vessels should be capable of generating
revenues.
Ownership days: We define ownership days as the
aggregate number of days in a period during which each vessel in
our fleet has been owned by us. Ownership days are an indicator of
the size of our fleet over a period and affect both the amount of
revenues and the amount of expenses that we record during a
period.
Definitions of Capitalized
Terms
Convertible Bond Debt: Convertible Bond Debt
refers to 5.0% Convertible Senior Notes due 2024 issued by the
Company on July 29, 2019 that will mature on August 1, 2024.
Global Ultraco Debt Facility: Global Ultraco
Debt Facility refers to the senior secured credit facility entered
into by Eagle Bulk Ultraco LLC (“Eagle Ultraco”), a wholly-owned
subsidiary of the Company, along with certain of its vessel-owning
subsidiaries as guarantors, with the lenders party thereto (the
“Lenders”), Credit Agricole Corporate and Investment Bank (“Credit
Agricole”) as security trustee, structurer, sustainability
coordinator and facility agent. The Global Ultraco Debt Facility
provides for an aggregate principal amount of $485.3 million, which
consists of (i) a term loan facility in an aggregate principal
amount of $300.3 million (the “Term Facility”) and (ii) a revolving
credit facility in an aggregate principal amount of $185.0 million
(the “Revolving Facility”). The Global Ultraco Debt Facility is
secured by 52 of the Company's vessels. As of September 30,
2023, $54.6 million remains undrawn under the Revolving
Facility.
Conference Call
Information
As previously announced, members of Eagle’s
senior management team will host a teleconference and webcast at
8:00 a.m. ET on Friday, November 3, 2023, to discuss the third
quarter results.
A live webcast of the call will be available on
the Investor Relations page of the Company's website at
ir.eagleships.com. To access the call by phone, please register at
https://register.vevent.com/register/BIee839edd63884046b37812fb660d9ebb
and you will be provided with dial-in details. A replay of the
webcast will be available on the Investor Relations page of the
Company's website.
About Eagle Bulk Shipping
Inc.
The Company is a U.S.-based, fully integrated
shipowner-operator, providing global transportation solutions to a
diverse group of customers including miners, producers, traders and
end users. Headquartered in Stamford, Connecticut, with offices in
Singapore and Copenhagen, Eagle focuses exclusively on the
versatile midsize drybulk vessel segment and owns one of the
largest fleets of Supramax/Ultramax vessels in the world. The
Company performs all management services in-house (strategic,
commercial, operational, technical, and administrative) and employs
an active management approach to fleet trading with the objective
of optimizing revenue performance and maximizing earnings on a
risk-managed basis. For further information, please visit our
website: www.eagleships.com.
Website Information
We intend to use our website,
www.eagleships.com, as a means of disclosing material non-public
information and for complying with our disclosure obligations under
Regulation FD. Such disclosures will be included in our website’s
Investor Relations section. Accordingly, investors should monitor
the Investor Relations portion of our website, in addition to
following our press releases, filings with the SEC, public
conference calls, and webcasts. To subscribe to our e-mail alert
service, please click the “Investor Alerts” link in the Investor
Relations section of our website and submit your email address. The
information contained in, or that may be accessed through, our
website is not incorporated by reference into or a part of this
document or any other report or document we file with or furnish to
the SEC, and any references to our website are intended to be
inactive textual references only.
Disclaimer: Forward-Looking
Statements
Matters discussed in this release may constitute
forward-looking statements that may be deemed to be
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, Section 21E of the
Securities Exchange Act of 1934, as amended, and the Private
Securities Litigation Reform Act of 1995, and are intended to be
covered by the safe harbor provided for under these sections. These
statements may include words such as “believe,” “estimate,”
“project,” “intend,” “expect,” “plan,” “anticipate,” and similar
expressions in connection with any discussion of the timing or
nature of future operating or financial performance or other
events. Forward-looking statements in this release reflect
management’s current expectations and observations with respect to
future events and financial performance. Where we express an
expectation or belief as to future events or results, including
future plans with respect to financial performance, the payment of
dividends and/or repurchase of shares, or future actions of holders
of the Convertible Bond Debt, including whether or not to elect to
convert any portion of the Convertible Bond Debt prior to its
maturity date, such expectation or belief is expressed in good
faith and believed to have a reasonable basis. However, our
forward-looking statements are subject to risks, uncertainties, and
other factors, which could cause actual results to differ
materially from future results expressed, projected, or implied by
those forward-looking statements.
Where we express an expectation or belief as to
future events or results, such expectation or belief is expressed
in good faith and believed to have a reasonable basis. However, our
forward-looking statements are subject to risks, uncertainties, and
other factors, which could cause actual results to differ
materially from future results expressed, projected or implied by
those forward-looking statements. The principal factors that affect
our financial position, results of operations and cash flows
include market freight rates, which fluctuate based on various
economic and market conditions, periods of charter hire, vessel
operating expenses and voyage costs, which are incurred primarily
in U.S. dollars, depreciation expenses, which are a function of the
purchase price of our vessels and our vessels’ estimated useful
lives and scrap value, general and administrative expenses, and
financing costs related to our indebtedness. The accuracy of the
Company’s assumptions, expectations, beliefs and projections
depends on events or conditions that change over time and are thus
susceptible to change based on actual experience, new developments
and known and unknown risks. The Company gives no assurance that
the forward-looking statements will prove to be correct, does not
undertake any duty to update them and disclaims any intent or
obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws. Our
actual results may differ materially from those anticipated in
these forward-looking statements as a result of certain factors
which could include the following: (i) volatility of freight rates
driven by changes in demand for seaborne transportation of drybulk
commodities and in supply of drybulk shipping capacity; (ii)
changes in drybulk carrier capacity driven by levels of newbuilding
orders, scrapping rates or fleet utilization; (iii) changes in
rules and regulations applicable to the drybulk industry,
including, without limitation, regulations of the International
Maritime Organization and the European Union (the “EU”),
requirements of the Environmental Protection Agency and other
governmental and quasi-governmental agencies; (iv) changes in U.S.,
United Kingdom, United Nations and EU economic sanctions and trade
embargo laws and regulations as well as equivalent economic
sanctions laws of other relevant jurisdictions; (v) actions taken
by regulatory authorities including, without limitation, the U.S.
Treasury Department’s Office of Foreign Assets Control (“OFAC”);
(vi) changes in the typical seasonal variations in drybulk freight
rates; (vii) changes in national and international economic and
political conditions including, without limitation, the current
conflicts between Russia and Ukraine and Israel and Hamas, the
current economic and political environment in China and the
environment in historically high-risk geographic areas such as the
South China Sea, the Indian Ocean, the Gulf of Guinea and the Gulf
of Aden; (viii) changes in the condition of the Company’s vessels
or applicable maintenance or regulatory standards (which may
affect, among other things, our anticipated drydocking costs); (ix)
the duration and impact of the novel coronavirus (“COVID-19”)
pandemic and measures implemented by governments of various
countries in response to the COVID-19 pandemic; (x) volatility of
the cost of fuel; (xi) volatility of costs of labor and materials
needed to operate our business due to inflation; (xii) any legal
proceedings which we may be involved from time to time; and (xiii)
other factors listed from time to time in our filings with the
Securities and Exchange Commission (the “SEC”).
We have based these statements on assumptions
and analyses formed by applying our experience and perception of
historical trends, current conditions, expected future developments
and other factors we believe are appropriate in the circumstances.
The Company’s future results may be impacted by adverse economic
conditions, such as inflation, deflation, or lack of liquidity in
the capital markets, that may negatively affect it or parties with
whom it does business. Should one or more of the foregoing risks or
uncertainties materialize in a way that negatively impacts the
Company, or should the Company’s underlying assumptions prove
incorrect, the Company’s actual results may vary materially from
those anticipated in its forward-looking statements, and its
business, financial condition and results of operations could be
materially and adversely affected. Risks and uncertainties are
further described in our Annual Report on Form 10-K for the year
ended December 31, 2022, as filed with the SEC on
March 10, 2023, as updated by those risks described in Part
II, Item 1A of our Quarterly Report on Form 10-Q for the three
months ended June 30, 2023, filed with the SEC on August 4,
2023.
CONTACT
Company Contact:Constantine TsoutsoplidesChief
Financial OfficerEagle Bulk Shipping Inc.Tel. +1 203-276-8100Email:
investor@eagleships.com
Source: Eagle Bulk Shipping Inc.
Grafico Azioni Eagle Bulk Shipping (NYSE:EGLE)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Eagle Bulk Shipping (NYSE:EGLE)
Storico
Da Set 2023 a Set 2024