Greek Shipping News Cuts
Week 32 - 2009
---Thursday, 6 August 2009 - 18:17. Hellenic Seaways acquired easyCruise Ltd, an official announcement said Thursday.
EasyCruise was founded by Stelios Haji-Ioannou in 2005 and the recent years it is present in Greece, operating cruises to the Greek islands and Turkey.
Uncovering the old Port of Theodosius
Considered to be one of the most important maritime archaeological finds in recent times, the port was founded during the reign of the Byzantine emperor Theodosius II (408-450) to serve the needs of his ever-growing capital, Constantinople. Ships flocked to the port laden with goods not only from the Mediterranean, the Black Sea and the Danube, but also from as far as Persia (pearls and carpets), India (ivory and spices) and China (silk).
Several of the ships discovered during the excavations sank in around 1000, either during a very fierce storm or a tsunami caused by an earthquake. Most were built out of local oak, chestnut and pine and were caulked using a glutinous mix of pine raisin and oakum. The sails of Byzantine commercial ships tended to be square and made out of linen, hemp and cotton. The archaeologists can tell when a ship was built by the tool marks on the wood. For example, if the planks were fitted first, it was built around the seventh century; if the frame came first, then not before the ninth century.
Source: Fairplay International Shipping Weekly - Shoes And Ships 06 Aug 2009
Prinos oil production triples Aegean Energy S.A, announces
---Aegean Energy S.A, the major stockholder of Kavala Oil, on Tuesday announced that oil production rose to 3,000 barrels a day following the successful completion of drilling for a new well at the Prinos North Field, the longest well ever drilled in Greek waters.
The well, an investment of more than 38 million euros, was drilled by the Jack-up Rig Energy Exerter of Northern Offshore to a total measured depth of 4,370 meters over the course of 135 days.
Aegean Energy also announced that it planning the first drilling on the Epsilon field. The first drilling will have a total depth of 5,500 metres and is scheduled to begin production in September 2009.
The company employs 280 people and the new oil reservoirs, Prinos North Field and Epsilon, are located in Kavala Bay, 4.3 nautical miles west of the island of Thassos.
Minister inaugurates new port in central Greece
---Merchant Marine Minister Anastassios Papaligouras inaugurated on Tuesday the port of Agiokampos in the Larissa prefecture, central Greece.
"The Karamanlis government transforms the country's port infrastructure aiming at facilitating the local population's and visitors's life as well as reinforcing development," Papaligouras said. With the new port, the minister added, the broader region's needs are satisfied more effectively, while the perspective opens for connecting by sea central Greece with Halkidiki, the Sporades islands and Evia.
ABS: European survey headquarters moves from London to Greece
---August 4, 2009. Senior Survey Management Changes at ABS
Appointed to the position of Divisional Vice President and Assistant Chief Surveyor responsible for all ABS survey activities from Dublin to Karachi and Capetown to Murmansk is ABS veteran Dimitri Houliarakis who has served for many years as Regional Vice President for Eastern Europe. He joins Dimitri Kostaras, Divisional Vice President of Engineering and Captain Steve Blair, Divisional head of Health, Safety, Quality and the Environment in Piraeus, immeasurably strengthening the ABS presence in this major shipping center.
Castro replaces Kurt Larsen in Shanghai. Larsen is to relocate to Houston where he will join the Corporate Survey and Classification team as Assistant Chief Surveyor, providing direct support to ABS Senior Vice President and Chief Surveyor Lenny Pendexter.
Founded in 1862, ABS is a leading international classification society devoted to promoting the security of life, property and the marine environment through the development and verification of standards for the design, construction and operational maintenance of marine-related facilities.
For more information, contact:
ABS Corporate Communications
1-281 877 5853 or email@example.com
Left spinning by Trafigura
That was a little hard, given that the man at the end of the telephone number provided to gain further information at Trafigura redirected inquiries back to the PR company, which knew very little about the new company, except what the very brief press release said.
Just why Trafigura felt the need to reorganise its chartering company structure will remain, for the time being, a secret
Owners turn to private equity
---More and more listed players are using alternative follow-on shares methods to weather the financial crisis with some looking to invest in discounted ships.
Wall Street may be closed to initial public offerings (IPOs) from shipowners but that does not mean equity markets are closed.
Indeed, the opposite has been true, as a parade of owners has marched toward follow-on shares issues with names like "at the market" (ATMs), Standby Equity Distribution Agreement (SEDAs) and "bought" or "overnight" deals.
The recent market rush includes a number of companies who are using the new cash - or at least talking about using it - to buy new ships. Many are still functioning under bank waivers after sinking underwater on their "old" vessels.
Those dipping a toe in the new market while still ankle-deep in the quagmire of the old one might, at first blush, appear to be a contradiction. Are they examples of excess at a time when shareholder dilution no longer seems to be a limiting factor? Or are they performing a fine balancing act whose execution could separate the winners and losers going forward?
According to Mark Angelo, president of New Jersey-based hedge fund Yorkville Advisors, shipowners are not unlike managers of a real-estate portfolio full of high-priced properties bought in a robust market. It makes sense to bring down the portfolio's average cost through discounts now available in the depressed market but the "legacy" assets limit flexibility.
"Shipping is a very attractive sector to get into right now if you don't have the overhang of legacy assets," Angelo said. "The problem is that so many of the public companies do. They're confronted with similar challenges and it's a test of the skill of each management team to navigate them." While Yorkville models its SEDA offerings to minimise share weakness, Angelo notes that dilution need not be a deterrent if an owner can buy new ships at an even more discounted rate and thus add to its bottom line.
Shipowner Peter Georgiopoulos also discussed the dilemma in a recent interview with TradeWinds ( see page 8 ).
"It's not so much walking a tightrope as it is a two-step process," Georgiopulos said. "The first analysis is whether you need to sell shares to survive. The second analysis is, is it worth it for me to sell shares at this [dilutive] level if I can buy more ships?"
Georgiopoulos's General Maritime (Genmar) and Genco Shipping & Trading neither face the survival question, nor at this point consider it worthwhile to sell shares to fund expansion, he adds.
But others operating under covenant waivers have decided differently - most notably George Economou's DryShips, which raised nearly $1bn in follow-on shares issuances, and nephew Anthony Kandylidis's OceanFreight, which raised $112m through Yorkville, and has signed up for $450m more. In addition, Greece's Top Ships has targeted $200m through Yorkville and in a smaller deal, bulker owner FreeSeas raised up to $18m, partly to buy a ship.
DnB NOR head of shipping Harald Serck-Hanssen explains that fleet expansion is not necessarily antithetical to resolving valuation breaches. If structured properly, the new buys actually can help.
"Banks would obviously prefer that shipping companies struggling with [minimum-value covenant] breaches or financial covenants use any new equity to strengthen liquidity and/or reduce debt," Serck-Hanssen said.
"However, in order to attract new equity, shipping companies must usually have the opportunity to use at least some of the proceeds to purchase vessels at what might be perceived as reasonable prices. Assuming moderate gearing on the new vessels, adding these to a fleet loan will improve the banks' security position, and it can in some cases be a way of curing a [minimum-value covenant] breach."
By Joe Brady Stamford
Published: 23:00 GMT, 06 Aug 2009 | last updated: 11:16 GMT, 07 Aug 2009
Aggelikousis Fleet Restructuring
This decision is linked to the obligatory retirement of single hull tankers before 2010, which until recently represented the 17% of the fleet.
Market sources say that the cost for this kind of convertion has dropped to 20 mil. euro from 40 mil. euro 1.5 years ago, when the dry cargo market was attributing the biggest profits of all times.
Besides the Cosco Dalian shipyards, the Greek shipowner has also signed a contract for convertion of single hull tankers with Yiu Lian Dockyards.
New Eagle Bulk venture expected to soon start hunting tonnage
---Sophocles Zoullas-led Eagle Bulk Shipping has entered into an agreement with a new ship-acquisition entity called Delphin Shipping and is expected to soon start hunting for new tonnage. Eagle Bulk's chairman and ceo, Zoullas, is Delphin's non-executive chairman.
In a statement, August 5, Eagle Bulk made the intentions of the new entity clear. It said: "Delphin has been formed to take advantage of opportunities in the shipping sector, including dry-bulk and other sectors." It went on: "Eagle Bulk will have the initial opportunity to acquire any dry bulk vessels being evaluated for purchase by Delphin and will have a right of first offer on the sale of any dry bulk vessel by Delphin."
Eagle Bulk is to provide commercial and technical supervisory management services for the dry bulk vessel investments of Delphin, which is registered in the Marshall Islands. Eagle BUlk said this activity "will provide additional fee income and cost savings to the company from the economies of scale generated by operating a large fleet of dry bulk vessels".
Delphin Shipping is connected with private equity company Kelso & Co, a backer of Eagle Bulk's flotation on the Nasdaq in 2005.
In July Eagle Bulk secured $100m in additional cash after an equity distribution agreement with UBS Securities as part of a wider automatic shelf registration, which allowed Eagle to issue up to $500m in new shares or other securities over a three-year period.
Eagle Bulk also announced August 5 that its net profit for the three months to the end of June slipped from $14.91m to $13.35m on higher expenses associated with a larger fleet, higher crew wages and insurance costs and increased depreciation. Zoullas hailed the increase in revenues to $53.02m in the latest quarter from the $37.22m for the 2008 three months.
Further, it said it has amended its revolving credit facility "on terms that will provide the company with enhanced financial flexibility". Collateral covenants previously based on vessel market values are now based on vessel book values.
The company said that its "non-amortising revolving credit facility has been amended from $1.35bn to $1.2bn with maturity in July 2014, and the company will use half the net proceeds from any equity issuance to repay debt and reduce the facility". It will continue to draw on the facility to fund its newbuilding programme.
-- Filed: 2009-08-06
Navios Maritime Holdings Inc. Announces Delivery of Three Newbuild Capesize Vessels
---PIRAEUS, Greece, Aug 03, 2009 /PRNewswire-FirstCall via COMTEX/ -- Navios Maritime Holdings Inc. ("Navios Holdings") (NYSE: NM) a global, vertically integrated seaborne shipping and logistics company, announced today that it took scheduled delivery in June and July, 2009 of three newbuild Capesize vessels, constructed by South Korean shipyards.
Navios Holdings also announced that it issued a $20.0 million unsecured Bond due 2012 having a coupon of 6% to fund a portion of the purchase price due. A more detailed description of the vessels and an overview of certain material terms of the Bond are set forth below.
Capesize Vessels' Deliveries
The three vessels will be employed under existing long-term charter-out contracts that will generate a total annual EBITDA of approximately $46.6 million*. These contracts have been insured by an AA+ EU governmental agency. The details of the three newbuild Capesize vessels and their related charters are set forth in the below table:
Date rate per Charter
Name Type of Vessel (2009) day (net) Term
---------------- -------------- -------- ----------- -------
Navios Bonavis 180,022 dwt June 29 $47,400 5 years
Navios Happiness 180,022 dwt July 23 $55,100 5 years
Navios Pollux 180,727 dwt July 24 $42,250 10 years
* Assuming operating expense of $5,000 per day and 360 revenue days per year.
Two of the vessels are financed with 10-year term facility for $120.0 million with a margin at 190 bps. The third vessel is financed with a 10-year term facility for $60.0 million with margin at 225 bps.
Terms of $20.0 million 6% Unsecured Bond
Navios Holdings issued a $20.0 million unsecured bond due 2012 (the "Debt Security") in partial payment of the purchase price due. The Debt Security is not convertible into any securities of Navios Holdings and is structurally subordinated to the existing $300.0 million Senior Note outstanding and those other obligations which are guaranteed by Navios Holdings' subsidiaries. Interest will accrue on the principal amount of the Debt Security at the rate of 6% per annum. All accrued interest (which will not be compounded) will be first due and payable in July 2012, on the maturity date. The Debt Security may be prepaid by the Navios Holdings at any time without prepayment penalty.
Time Charter Coverage
Including the new Capesize vessels, Navios Holdings has extended the coverage of its core fleet (excluding vessels acquired through the Kleimar N.V. transaction) to 98.2% for 2009, 78.3% for 2010, 61.2% for 2011 and 55.5% for 2012.
Navios Holdings currently operates 38 vessels with an aggregate carrying capacity of 3.3 million deadweight tons. Including vessels to be delivered, Navios Holdings controls 57 vessels with an aggregate carrying capacity of 6.0 million deadweight tons.
Dahlman Rose & Co: Diana Shipping (DSX) - 2Q Results Slightly Below Forecasts; Remains In No Hurry To Acquire Dry Bulk Assets; Reiterate Buy & $22
>Diana Shipping reported 2Q09 EPS of $0.39, just off our $0.40 estimate, which was the same as average consensus.The miss stems mainly from lower than expected revenues, offset somewhat by lower than expected interest expense.
>Management maintains its cautious outlook.On the conference call, Diana stated it will continue to wait for more attractive growth opportunities, specifically targeting distressed assets. Diana also provided an indefinite horizon as to when dividends could potentially be reinstated, noting that any cash payouts will come only after ship acquisitions.
>Diana remains among the most well-capitalized companies in the dry bulk peer group.Following a $100 million share offering completed during 2Q, Diana is nearly net debt free with approximately $240 million in debt and $217 million in cash. Diana is one of the few that has not required loan covenant waivers, making it one of the strongest candidates to consolidate the market with a large-scale acquisition at some point in the future.
>Diana continues to employ its fleet based on its conservative chartering strategy.The company is fully-covered on term charters for 3Q, with just one vessel rolling off contract this year. Diana is nearly 70% covered for 2010, including its two Capesize newbuilds on order each contracted for 5 years at strong rates.
>Overall Diana is in no hurry to utilize its clean balance sheet.Management remains very cautious, although we believe the market currently presents attractive returns for secondhand vessels. We believe its shares can benefit from higher dry bulk demand brought on by an increase in global steel demand throughout the next several quarters. As such we reiterate our Buy rating and $22 target, which we arrive at by targeting 8x 2010 EBITDA.
Source: Dahlman Rose & Co
Tsakos Energy Navigation: 63rd Consecutive Profitable Quarter Since Inception
SECOND QUARTER 2009 HIGHLIGHTS
* Net revenues of $88.60 million versus $146.64 million in Q2 2008
* Net income of $18.77 million versus $69.21 million in Q2 2008
* EPS of $0.51 per share (diluted) versus $1.82 for Q2 2008
* Semi-annual dividend of $0.85 per share paid in April 2009 (bringing the total for fiscal 2008 to $1.75, up from $1.725 in fiscal 2007)
* 14% reduction in vessel daily operating expenses
FIRST HALF 2009 HIGHLIGHTS
* Net revenues of $194.74 million versus $262.31 million in the first half of 2008
* Net income of $43.23 million versus $134.34 million (including a $34.57 million capital gain) in the 2008 period
* EPS of $1.16 per share (diluted) versus $3.52 for the first half of 2008
* Three year extension of time-charter of suezmax tanker Triathlon, from seven years to ten
* Acquired and retired 237,700 shares for an average price of $16.59, a $3.9 million investment
ATHENS, Greece, Aug. 5, 2009 (GLOBE NEWSWIRE) -- Tsakos Energy Navigation Limited (TEN or the "Company") (NYSE:TNP) today reported results (unaudited) for the second quarter and first half of 2009.
SECOND QUARTER RESULTS
Revenues, net of voyage expenses and commissions, were $88.60 million in the second quarter of 2009 compared to $146.64 million in the comparable 2008 period reflecting the lower freight rate environment. TEN deployed on average 46.0 vessels versus 44.0 vessels in the prior year quarter. Fleet utilization remained high at 97.8% as compared with 97.4% in the second quarter of 2008. The average daily time charter equivalent rate per day, per vessel was $22,890 down from $39,512 in the 2008 quarter. Vessel operating costs were $8,514 per ship, per day, down 14% from $9,898 primarily due to lower crew costs, a result of a stronger US dollar against the Euro, and reduced repair expenditure given fewer vessel dry dockings, although higher insurance costs were incurred.
Depreciation and dry-docking amortization costs rose to $25.06 million from $22.03 million. Management fees increased in line with the larger fleet size and the 2009 fee increase, while G&A expenses were 20% down, partly as a result of a stronger US dollar. Stock compensation amortization was considerably reduced due to fewer grants outstanding and a lower share price.
Interest and finance costs net of interest income fell to $4.91 million from $9.08 million reflecting the reduction in interest rates, positive movements in interest rate swap valuations and positive movements in bunker swaps of $3.0 million included in interest and finance costs. Interest income was $1.13 million in the quarter compared to $1.82 million in the prior year quarter.
Net income in the 2009 period was $18.77 million versus $69.21 million in the second quarter of 2008. Diluted earnings per share were $0.51 versus $1.82 in the second quarter of 2008.
FIRST HALF RESULTS
Revenues, net of voyage expenses and commissions, were $194.74 million in the first six months of 2009, down from $262.31 million in the 2008 period reflecting the lower freight rate environment. TEN operated on average 46.0 vessels as compared with 43.6 a year earlier. TCE per vessel, per day decreased to $25,187 from $35,354 while operating expenses declined to $8,932 from $9,439. General and administrative expenses increased to $2.36 million from $2.11 million in the same period last year. Management fees rose in line with fleet expansion and contractual fee increases.
Interest and finance costs, net of interest income, decreased to $18.69 million from $30.73 million in the first half of 2008 due to reduced interest rates, positive interest rate swap valuations and a positive impact of bunker swap movements. Depreciation and drydocking amortization costs rose to $49.85 million from $44.01 million as a result of fleet expansion. G&A expenses were slightly increased over the previous first half year, but stock compensation expenses decreased to $0.19 million from $3.09 million.
Net income in the first half of 2009 reached $43.23 million compared to net income of $134.34 million in the corresponding 2008 period which included a gain on vessel sale of $34.6 million. Diluted earnings per share for the first half of 2009 were $1.16, while diluted earnings per share for the first six months of 2008 were $3.52.
"The rebound from the financial panic and the ensuing collapse of economies around the world has been and will be tedious. The impact on oil demand has been a severe drag on the tanker industry," observed D. John Stavropoulos, Chairman of the Board. He added, "The ability to operate profitably in such an environment verifies TEN's strategies and policies."
In early July, the 2007-built suezmax tanker Arctic was fixed on a three-year time charter to a major South American oil company with a fixed minimum daily rate and a 50:50 profit share to a maximum pre-agreed level. Assuming only the minimum rate, this charter is expected to generate at least $25 million in gross revenues.
In late July, the 2006-built aframax product tanker Promitheas entered a time charter, up to six months, at a fixed rate to a major international oil trading company. The vessel was operating in the spot market.
On July 17, TEN took delivery of the Ise Princess, the fifth DNA-design aframax tanker in a series of eight from Sumitomo Heavy Industries in Japan. Upon delivery, the vessel entered an up to four month redelivery time charter to the Mid-Atlantic basin.
In late July 2009, TEN signed contracts for the construction of two suezmax tankers at the Sungdong shipyard in South Korea for delivery in the third quarter of 2011 for a price well below the highs established in 2008. The vessels are expected to be financed by a combination of bank debt and cash equity.
FLEET STRATEGY & OUTLOOK
In the second quarter, the turmoil and uncertainty prevailing in the global economy continued to impact the shipping markets. In this context, rates experienced prolonged downward pressures with welcome short-term lifts. The reduction in global oil demand and the effect of above average global oil inventories contributed to this softness.
In this world of uncertainty, TEN produced again results that validate its prudent strategy in terms of fleet deployment and operations and highlight its healthy financial foundation. As a result of this strategy, the Company's cash reserves rose to $309 million in the second quarter of 2009, an increase from last year. Cash preservation especially in times of global economic uncertainty has become the Company's cornerstone as it not only safeguards TEN from prolonged market pressures, should they occur, but also provides it with significant fire power to take advantage of opportunities that might arise either in the second hand or newbuilding market.
Looking ahead, signs of recovery in our markets will eventually occur as the world economies gradually start to rebound, as many analyst and market commentators predict. On the chartering front, such evidence starts to become apparent as charterers are beginning to reevaluate longer term time charters. TEN will continue to explore all available options for the chartering of its vessels and will strive to further increase the fixed employment of the fleet going forward. As of the third quarter 2009, TEN had 66% of remaining operating days under fixed employment and 44% for 2010. Without taking into consideration the potential additional revenues from profit-sharing arrangements in place and assuming only the minimum rates for the remaining operating days in 2009, TEN expects to earn at least $128 million in incremental gross revenues. For 2010, based on the same assumptions, the minimum gross revenue already secured is estimated at $170 million.
"In the challenging environment of this second quarter, TEN proved resilient to market pressures and the quality of our fleet continued to be in high demand from major oil companies as evidenced by our recent charters," Mr. Nikolas P. Tsakos, President & CEO of TEN, stated. "With expected improvements in the world economy during 2010, global oil demand should begin to show signs of recovery and our modern, versatile fleet, including our two recent newbuilding orders, will be well positioned to take advantage of the improvements. Our objective remains to operate the fleet with the highest possible utilization rate, efficiently, cost effectively and profitably," Mr. Tsakos concluded.
As previously announced, today, Wednesday, August 5th at 10:00 a.m. Eastern Time, TEN will host a conference call to review the results as well as management's outlook for the business. The call, which will be hosted by TEN's senior management, may contain information beyond what is included in the earnings press release.
To participate in the call from the United States or Canada, please dial +1.888.694.4702 approximately five minutes prior to the starting time. To participate in the call outside the United States or Canada, please dial +1.973.582.2741 five minutes prior to the starting time. The Conference ID is 2175 9049.
Two hours after the completion of the conference call, a digital recording of the call will be available for seven days, and can be accessed by dialing +1.800.642.1687 from inside the United States or Canada and +1.706.645.9291 from outside the United States or Canada and entering the Conference ID 2175 9049.
The call, which will be simultaneously broadcast live over the Internet, can be accessed at: http://www.videonewswire.com/event.asp?id=60858. The online archive of the broadcast will be available within one hour of the live call at the same web address.
ABOUT TSAKOS ENERGY NAVIGATION
TEN's pro forma fleet consists of 52 vessels of 5.6 million dwt. TEN's operational fleet consists of 47 vessels all of double-hull design. TEN's newbuilding program includes three DNA-aframax crude carriers and two suezmax tankers totaling about 615,000 dwt.
TEN's balanced fleet profile is reflected in 27 crude tankers ranging from VLCCs to aframaxes and 24 product carriers ranging from aframaxes to handysize, complemented by one LNG.
Source: Tsakos Energy Navigation Limited
Lack of revenue hits Capital
---(Aug 7 2009). Announcing results for 2Q09, Capital Product Partners reported net income of $8 mill, or $0.32 per limited partnership unit, which is $0.03 less than the $0.35 per unit from the 1Q09, and $0.19 lower than the second quarter last year.
This drop compared to last year was primarily due to the absence of profit sharing revenues and higher interest expenses, Capital said.
Operating surplus for 1Q09 was $11.5 mill, less than the $11.9 mill from the first quarter and lower than the $15.7 mill from the second quarter of 2008.
Revenues for 2Q09 were $31.2 mill, compared to $32 mill in 2Q08. There were no profit sharing revenues in the second quarter of this year due to the very challenging spot market for both product and crude tankers throughout this period. In 2Q08 the profit sharing revenues amounted to $4.5 mill.
Total operating expenses for 2Q09 were $16 mill, including $8 mill paid to a subsidiary of Capital Maritime & Trading Corp (Capital Maritime), the partnership's sponsor, for the commercial and technical management of the fleet, $7 mill in depreciation and $600,000 in general and administrative expenses, compared to $13.7 mill for 2Q08.
The increase was partly due to certain additional fees and costs incurred in relation to the technical management of the vessels.
Interest expense and finance cost for the second quarter totalled $7.5 mill compared to $5.9 mill for 2Q08. The increase in interest expense was due to the increased debt of the partnership compared to a year ago, as well as an additional cost of $400,000, which was due to the increased funding costs of the banks, incurred in accordance with the terms of the existing loan agreements.
As of 30th June, 2009, the partnership's long-term debt remained unchanged compared to the end of 2008 at $474 mill and partners' equity was $164.1 mill. The remaining undrawn amounts under the terms of the debt facilities currently stand at $246 mill.
Lazaridis explained: "Due to a significant deterioration in the tanker market, the partnership obtained an amendment to certain terms in its loan agreements effective until end June 2012. The lenders under both facilities have agreed to increase the fleet loan-to-value covenant to 80% from 72.5%.
"It was also agreed to amend the manner in which market valuations of our vessels are conducted. In exchange, the interest margin for both of our credit facilities will increase to 135-145 bps over LIBOR subject to the level of the asset covenants. Currently the margin on our $370 mill credit facility is 75bps over LIBOR and on our $350 mill credit facility it is 110bps over LIBOR. All other terms in both of our facilities remain unchanged."
TOP Ships Inc. announces delivery of its last newbuilding vessel, and waiver from RBS
TOP Ships Inc. also received today a notification from the bareboat charterer of the M/T Papillon (ex VOC Gallant), wherein such charterer declared its intention to pay a reduced charterhire rate of $18,000 per day, rather than $24,000 per day on a bareboat basis as is set forth in the charterparty. As a result, TOP Ships Inc. believes that such charterer is in breach of the charterparty agreement, and TOP Ships Inc. has commenced arbitration proceedings against such charterer to recover amounts owed.
Finally, TOP Ships Inc. has obtained a waiver from the Royal Bank of Scotland (RBS) until March 31, 2010 in relation to the breach of certain financial covenants under the RBS term loan.
About TOP Ships Inc.
TOP Ships Inc., formerly known as TOP Tankers Inc., is an international provider of worldwide seaborne crude oil and petroleum products and drybulk transportation services. The Company operates a combined tanker and drybulk fleet as follows:
> A fleet of five drybulk vessels with a total carrying capacity of approximately 0.3 million dwt, of which 47% are sister ships. All of the Company's drybulk vessels have fixed rate employment contracts for an average period of 26 months.
Source: press release
Eagle Bulk Shipping Inc. Reports Q2 2009 Results - Revenue increases 42% year-on-year
---NEW YORK, Aug. 5, 2009 (GLOBE NEWSWIRE) -- Eagle Bulk Shipping Inc. (Nasdaq: EGLE) today announced its results for the second quarter of 2009.
Second quarter 2009 highlights included:
* Net income was $13.3 million or $0.26 per share (based on a weighted average of 52.3 million shares), compared to net income of $14.9 million or $0.32 per share (based on a weighted average of 47.1 million shares) in the second quarter of 2008.
* Net Revenues were $53.0 million, up 42% from $37.2 million in the second quarter of 2008. Gross time charter revenue increased by 43% to $55.9 million, from $39.2 in the second quarter of 2008.
* EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, increased by 22% to $33.8 million, from $27.8 million in the second quarter of 2008.
* Fleet utilization rate for the second quarter was 99.7%.
* Successful completion of a $100 million offering of common stock. A portion of the proceeds will be used to repay debt.
* Total cash and cash equivalents increases to $142 million.
Subsequent to the end of the second quarter, Eagle Bulk successfully amended its revolving credit facility on terms that will provide the Company with enhanced financial flexibility. Under this amendment, the collateral covenants which were based on vessel market values are now based on vessel book values. Collateral covenants will revert to vessel market values only when the drybulk market recovers, enabling provisions of the original facility to be met for two consecutive quarters. Among other amendments, the EBITDA to interest coverage ratio has been reduced to 1.2x until June 2011, then will be 1.3x until provisions of the original facility are met for two consecutive quarters. Interest will be borne at Libor plus a margin of 2.5%. The non-amortizing revolving credit facility has been amended from $1.35 billion to $1.2 billion with maturity in July 2014, and the Company will use half the net proceeds from any equity issuance to repay debt and reduce the facility. The Company will continue to draw on the facility to fund its newbuilding commitments, and this agreement further supports the funding for the remainder of its newbuilding program.
Sophocles N. Zoullas, Chairman and Chief Executive Officer, commented, "We are pleased to report another quarter marked by steady cash flow and stellar operating performance. These achievements validate the Company's disciplined chartering strategy amid uncertainty in the dry bulk market, and significant charter cover for the balance of 2009 will ensure revenue stability going forward. Going forward, we also see the potential for upside from open capacity and indexed charters in a strengthening rate environment, as well as our on-plan fleet expansion program."
Mr. Zoullas continued, "Furthermore, our cash position at the close of the quarter of $142 million, in conjunction with the comprehensive credit facility amendment which we announced today, strengthens our balance sheet and will ensure we execute responsibly on our corporate growth initiatives."
Separately, the Company announced that it has entered into an agreement with Delphin Shipping LLC, a newly formed Marshall Islands limited liability company affiliated with Kelso & Co., a private equity firm, and Eagle Bulk's Chief Executive Officer Sophocles Zoullas, who has agreed to serve as Delphin's non-executive chairman. Delphin has been formed to take advantage of opportunities in the shipping sector, including drybulk and other sectors. Eagle Bulk will have the initial opportunity to acquire any dry bulk vessels being evaluated for purchase by Delphin and will have a right of first offer on the sale of any drybulk vessel by Delphin. The Company will provide commercial and technical supervisory management services for the dry bulk vessel investments of Delphin which will provide additional fee income and cost savings to the Company from the economies of scale generated by operating a large fleet of dry bulk vessels.
Results of Operations for the three month period ended June 30, 2009
For the second quarter of 2009, the Company reported net income of $13,347,535 or $0.26 per share, based on a weighted average of 52,295,221 diluted shares outstanding. In the comparable second quarter of 2008, the Company reported net income of $14,906,130 or $0.32 per share, based on a weighted average of 47,123,585 diluted shares outstanding.
All of the Company's revenues were earned from time charters. Gross time charter revenues in the quarter ended June 30, 2009 were $55,933,747, an increase of 43% from $39,170,513 recorded in the comparable quarter in 2008, primarily due to the operation of a larger fleet. Third party brokerage commissions incurred on those gross revenues were $2,912,409 and $1,947,313, respectively. Net revenues during the quarter ended June 30, 2009, increased 42% to $53,021,338 from $37,223,200 in the comparable quarter in 2008.
Total operating expenses were $32,918,240 in the quarter ended June 30, 2009 compared to $19,750,394 recorded in the second quarter of 2008. The increase was due to operation of a larger fleet, increases in vessel crew and insurance costs, general and administrative expenses, and vessel depreciation expenses.
EBITDA, adjusted for exceptional items under the terms of the Company's credit agreement, increased by 22% to $33,804,619 for the second quarter of 2009, from $27,802,569 for the second quarter of 2008. (Please see below for a reconciliation of EBITDA to net income).
Results of Operations for the six month period ended June 30, 2009
For the six months ended June 30, 2009, the Company reported net income of $30,584,316 or $0.62 per share, based on a weighted average of 49,686,359 diluted shares outstanding. In the comparable period of 2008, the Company reported net income of $29,251,940 or $0.62 per share, based on a weighted average of 47,047,552 diluted shares outstanding.
All of the Company's revenues were earned from time charters. Gross time charter revenues for the six-month period ended June 30, 2009 were $114,555,447, an increase of 47% from $77,781,434 recorded in the comparable period in 2008, primarily due to the operation of a larger fleet. Brokerage commissions incurred on those gross revenues were $5,556,443 and $3,872,218, respectively. Net revenues during the six-month period ended June 30, 2009, increased 47% to $108,999,004 from $73,909,216 in the comparable period in 2008.
Total operating expenses were $65,183,381 in the six-months ended June 30, 2009 compared to $40,126,853 recorded in the same period of 2008. The increase was due to operation of a larger fleet, increases in vessel crew and insurance costs, general and administrative expenses, and vessel depreciation expenses.
EBITDA, adjusted for exceptional items under the terms of the Company's credit agreement, increased by 28% to $71,065,186 for the six months ended June 30, 2009, from $55,350,374 for the same period in 2008. (Please see below for a reconciliation of EBITDA to net income).
Liquidity and Capital Resources
Net cash provided by operating activities during the six month periods ended June 30, 2009 and 2008, was $66,456,504 and $49,815,118, respectively, as the Company's fleet days increased to 4,413 days from 3,294 days.
Net cash used in investing activities during the six month period ended June 30, 2009, was $60,498,258, compared to $159,879,332 during the corresponding six month period ended June 30, 2008. Investing activities during the six month period ended June 30, 2009 related primarily to progress payments and related construction expenses for the newbuilding vessels.
Net cash provided by financing activities during the six month period ended June 30, 2009, was $114,092,565, compared to net cash provided by financing activities of $20,157,135 during the corresponding six month period ended June 30, 2008. During the six month period ended June 30, 2009, the Company received $97,291,046 in net proceeds from the sale of shares of common shares of the Company, and borrowed $19,505,000 from our revolving credit facility.
As of June 30, 2009, our cash balance was $129,259,673, compared to a cash balance of $9,208,862 at December 31, 2008. In addition, $12,500,000 in cash deposits are maintained with the Company's lender for loan compliance purposes and this amount is recorded in Restricted cash in the financial statements as of June 30, 2009.
At June 30, 2009, the Company had outstanding debt of $809,106,403 which was borrowed under its revolving credit facility. Under the third amendment, as discussed above, the Company, in the third quarter of 2009, will incur a fee of 0.25% of the revised facility amount and will record a charge of approximately $3.4 million relating to the write-off deferred financing fees.
Disclosure of Non-GAAP Financial Measures
EBITDA represents operating earnings before extraordinary items, depreciation and amortization, interest expense, and income taxes, if any. EBITDA is included because it is used by certain investors to measure a company's financial performance. EBITDA is not an item recognized by GAAP and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity. EBITDA is presented to provide additional information with respect to the Company's ability to satisfy its obligations including debt service, capital expenditures, and working capital requirements. While EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.
The annual Marine Money Greek ship finance forum is again shaping up as an important event
---In what is the largest gathering in Greece of the capital markets and shipping, Marine Money will again bring together an enormous array of individual talent and institutional power in an environment of business opportunity. Our 11th Annual Marine Money Greek Ship Finance Forum is where Greek ship owners, international financiers, investors and other industry professionals will meet to discuss the state of the ship finance industry.
Whether it is to hear about investment and market insights or to determine for yourself just where the capital the industry requires will come from, the Marine Money Greek Ship Finance Forum will be the source of deals, money, insights and relationships in Athens on the 8th of October 2009.
Conference Agenda and everything related is available at: http://www.marinemoney.com/forums/GR09/greece2009.html
Sponsors confirmed to-date:
Speakers Dinner Sponsor Navios Maritime Holdings Inc.
Lunch Sponsor Tsakos Energy Navigation Limited
Capital Party Sponsor Capital Product Partners L.P.
Prime Sponsors Diana Shipping Inc. * Excel Maritime Carriers Ltd. * International Registries, Inc. ( Closing Recption co-host) * Jefferies & Company Inc. * Star Bulk Carriers Corp.
Corporate Sponsors Blank Rome * Cantor Fitzgerald & Company * Credit Suisse * Deloitte. * Dubai Maritime City * DVB Bank SE * Ernst & Young * Golden Destiny SA * Mari-Time Holdings Ltd. * Nordea * Pareto * PricewaterhouseCoopers * Seanergy Maritime Corp. * Seward & Kissel LLP * Top Ships Inc. * Watson, Farley & Williams LLP * World Oils
Media Sponsor Lloyd's Register - Fairplay Ltd. * Naftiliaki * Newsfront * The Maritime Executive