SBLK Star Bulk Carriers Corporation

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2015

Commission File Number:  001-33869

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F [ X ]       Form 40-F [  ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [  ].

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [  ].

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

 

The information contained in this Form 6-K (including the exhibit hereto) is hereby incorporated by reference into the registrant's Registration Statements on Form F-3 (File Nos. 333-197886 and 333-198832) and Registration Statement on Form S-8 (File No. 333-176922), to be a part thereof from the date on which this report is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.

 

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INFORMATION CONTAINED IN THIS FORM 6-K REPORT

Attached as Exhibit 99.1 is a report by Star Bulk Carriers Corp. (the “Company” or “Star Bulk”) of its Financial Results for the Third Quarter ended September 30, 2015.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

This Form 6-K, and the documents to which the Company refers in this Form 6-K, as well as information included in oral statements or other written statements made or to be made by the Company, contain “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act, with respect to our financial condition, results of operations and business and our expectations or beliefs concerning future events. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “projects,” “likely,” “would,” “could” and similar expressions or phrases may identify forward-looking statements.

All forward-looking statements involve risks and uncertainties. The occurrence of the events described, and the achievement of the expected results, depend on many events, some or all of which are not predictable or within our control. Actual results may differ materially from expected results.

In addition, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include:

 

Consequently, all of the forward-looking statements we make in this document are qualified by the information contained or referred to herein, including, but not limited to, (i) the information contained under this heading and (ii) the information disclosed in the Company’s annual report on Form 20-F for the fiscal year ended 2014, filed with the SEC on April 8, 2015.

You should carefully consider the cautionary statements contained or referred to in this section in connection with any subsequent written or oral forward-looking statements that may be issued by us or persons acting on our behalf. Except as required by law, the Company undertakes no obligation to update any of these forward-looking statements.

 

 

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	STAR BULK CARRIERS CORP.
	(Registrant)
Date: November 17, 2015	By:	/s/ Simos Spyrou
	Name:	Simos Spyrou
	Title:	Co-Chief Financial Officer

 

 

 

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REPORT OF FINANCIAL RESULTS FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2015

ATHENS, GREECE, November 17, 2015 – Star Bulk Carriers Corp. (the "Company" or "Star Bulk") (Nasdaq: SBLK), a global shipping company focusing on the transportation of dry bulk cargoes, today announced its unaudited financial and operating results for the third quarter and nine months ended September 30, 2015.

(1)

See the table at the back of this release for a reconciliation of EBITDA and Adjusted EBITDA to Net Cash Provided by / (Used in) Operating Activities, which is the most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States ("U.S. GAAP").

(2)

Average daily Net Cash G&A expenses per vessel is calculated by deducting Management fee Income from, and adding the Management fee expense to, General and Administrative expenses (net of stock based compensation expense) and then dividing the result by ownership days.

 

 

 

(*) Subject to a bareboat charter that is accounted for as a capital lease.

 

(*) Subject to a bareboat charter that will be accounted for as a capital lease.

(**)To be financed under a capital lease.

—

On October 15, 2015, the vessel Star Nicole was delivered to its new owners pursuant to a sale agreement signed on September 16, 2015. Proceeds from the sale of Star Nicole were $3.8 million.

—

On October 9, 2015, we took delivery of the Ultramax vessel Star Antares (ex-HN NE 196). The delivery installment of $19.8 million was partially financed by $16.7 million drawn down on September 29, 2015, under the Sinosure Facility.

—

In October 2015, we reassigned a lease for a newbuilding vessel back to the vessel's owner for a one-time payment to us of $5.8 million.

—

In October 2015, we agreed in principle with certain shipyards to defer the delivery of four of our newbuilding vessels to 2016. The vessels were originally due for delivery to us in the fourth quarter of 2015. The deferrals are subject to execution of definitive documentation.

 

 

 

 

 

 

 

 

 

 

Capitalized terms used but not defined herein shall have the meaning ascribed to them in our Annual Report on Form 20-F for the fiscal year ended December 31, 2014, filed with the SEC on April 8, 2015.

For the third quarter of 2015, total voyage revenues were $68.7 million compared to $36.5 million for the third quarter of 2014. This increase was mainly due to the increase in our average number of vessels to 71.2 in the third quarter of 2015, from 31.5 vessels in the third quarter of 2014. The increase in voyage revenues from the additional vessels was partially offset by significantly lower charterhire rates prevailing in the dry bulk market during the third quarter of 2015, compared to the third quarter of 2014.

Management fee income during the third quarter of 2015 was $0.1 million compared to $0.3 million for the third quarter of 2014. This decrease was mainly due to the decrease in the average number of third-party vessels under management to 1.0 vessel in the third quarter of 2015, from 4.9 vessels in the third quarter of 2014. As a result of the acquisition of Oceanbulk, 11 Oceanbulk vessels that had been under our management became part of our fleet as of July 11, 2014, and we, therefore, stopped receiving fees for the management of these vessels.

For the third quarter of 2015, operating loss was $30.7 million, compared to operating income of $1.3 million for the third quarter of 2014, due primarily to the combination of:

—

an increase in the average number of vessels of our fleet;

—

lower charterhire rates for dry bulk carrier vessels;

—

respective non-cash vessel impairment loss and loss on sale of vessels of $5.4 million and $7.1 million recognized during the third quarter of 2015 that are described in more detail below;

—

a non-cash gain from bargain purchase of $12.3 million recognized in the third quarter of 2014 as a result of the acquisition of Oceanbulk; and

—

other operational gain of $9.4 million recognized in the third quarter of 2014, consisting of:

(i)

gain of $8.0 million from the sale to a third party of our claim against the previous charterer of the Star Borealis for charter party repudiation due to early redelivery of the vessel, which was collected in full in October 2014; and

(ii)

$1.4 million from the extinguishment of the liability to the previous charterer of Star Borealis, related to the amount of fuel and lubricants remaining on the board at the time of the charter repudiation.

Net loss for the third quarter of 2015 was $42.0 million, or $0.19 loss per basic and diluted share, calculated based on 219,120,612 weighted average number of basic and diluted shares. Net income for the third quarter of 2014 was $0.2 million, or $0.003 earnings per basic and diluted share, based on 77,233,053 and 77,437,791 weighted average number of basic and diluted shares, respectively.

Net loss for the third quarter of 2015 mainly included the following non-cash items:

 

Excluding these non-cash items, net loss for the third quarter of 2015 would have been $24.5 million, or $0.11 loss per basic and diluted share, based on 219,120,612 weighted average number of basic and diluted shares.

Net income for the third quarter of 2014 mainly included the following non-cash items:

 

In addition, net income for the third quarter of 2014 included non-recurring transaction costs of $7.0 million, or $0.09 per basic and diluted share, including legal and accounting costs, in connection with the acquisition of Oceanbulk, the Pappas Companies and the Heron Vessels.

Excluding these non-cash items and non-recurring transaction costs, net loss for the third quarter of 2014 would have been $2.2 million, or $0.03 loss per basic and diluted share, based on 77,233,053 and 77,437,791 weighted average number of basic and diluted shares, respectively.

Adjusted EBITDA for the third quarters of 2015 and 2014 was $6.1 million and $9.7 million, respectively. A reconciliation of EBITDA and adjusted EBITDA to net cash provided by cash flows from operating activities is set forth below.

During the third quarters of 2015 and 2014, we owned and operated an average of 71.2 and 31.5 vessels, respectively, which earned an average Time Charter Equivalent, or "TCE" of $8,702 and $11,159 per day, respectively. We refer you to footnote 8 under the heading "Summary of Selected Data" set forth below for information regarding our calculation of TCE rates.

For the third quarter of 2015, voyage expenses were $21.7 million, compared to $12.9 million for the third quarter of 2014. The increase in voyage expenses was due to the increase in the average number of vessels in the third quarter of 2015, as well as the increased level of spot market activity, which is associated with higher voyage expenses than time charters.

For the third quarters of 2015 and 2014, vessel operating expenses totalled $29.4 million and $15.1 million, respectively. The increase in operating expenses was mainly due to higher average number of vessels in the third quarter of 2015 compared to the third quarter of 2014. Our average daily operating expenses per vessel for the third quarter of 2015 were $4,484, compared to $5,192 during the third quarter of 2014, representing a 13.6% reduction as a result of synergies and economies of scale from operating a larger fleet. In addition, vessel operating expenses for the third quarters of 2015 and 2014 respectively included $1.6 million and $1.1 million of pre-delivery expenses, which related to the initial crew manning and the initial supply of stores for our vessels upon delivery. Excluding these amounts, our average daily operating expenses per vessel for the third quarter of 2015 and 2014 were $4,237 and $4,816, respectively, representing a reduction of 12%.

Dry docking expenses for the third quarters of 2015 and 2014 were $6.2 million and $3.6 million, respectively. During the third quarter of 2015, eight of our vessels underwent periodic dry docking surveys compared to two vessels in the third quarter of 2014.

Depreciation expense increased to $21.7 million for the third quarter of 2015, compared to $10.7 million for the third quarter of 2014. The increase was due to the higher average number of vessels in the third quarter of 2015 compared to the third quarter of 2014, partially offset by an increase in the estimated scrap rate per light weight

ton from $200 to $300, which became effective as of January 1, 2015, following our management's reassessment based on the historical average demolition market prices.

Management fees for the third quarter of 2015 and 2014 were $2.4 million and $0.1 million, respectively. As of January 1, 2015, we engaged Ship Procurement Services S.A. ("SPS"), an unaffiliated third party, to provide our fleet with certain procurement and remote vessel performance monitoring services at a daily fee of $295 per vessel. SPS will provide procurement and remote vessel performance monitoring services to a fleet of over 120 vessels. We expect to benefit from lower operating expenses and dry docking costs through the economies of scale that SPS will enjoy in managing such a large fleet. In addition, three of the Excel Vessels (Star Martha, Star Pauline and Star Despoina), which were acquired with attached time charter agreements, were managed by Maryville Maritime Inc. ("Maryville") until the expiration of their existing time charter agreements (two of which expired in August 2015 and one of which expired in November 2015) at a monthly fee of $17,500 per vessel.

During the third quarter of 2015, we had $5.5 million of general and administrative expenses, compared to $14.8 million during the third quarter of 2014. This decrease was mainly due to non-recurring transaction costs of $7.0 million, which were incurred during the third quarter of 2014 in connection with the acquisition of Oceanbulk, and a stock-based compensation expense of $1.8 million, also incurred in the third quarter of 2014, relating to a severance payment to our former Chief Executive Officer. Our average daily net cash general and administrative expenses per vessel for the third quarter of 2015 were $1,097, compared to $1,596 during the third quarter of 2014, representing a 31.3% reduction as a result of synergies and economies of scale from operating a larger fleet. This reduction was achieved despite an increase in wage expenses resulting from a 14% increase in our average number of employees during the third quarter of 2015 as compared to the same period in 2014.

During the third quarter of 2015, we recorded an impairment loss of an aggregate of $5.4 million in connection with the agreement to sell Star Nicole, which was delivered to its new owners in October 2015, and the agreement to reassign a lease for one newbuilding vessel back to the vessel's owner for a one-time payment to the Company of $5.8 million. Of this $5.4 million impairment loss, $2.5 million related to the write-off of the fair value adjustment recognized upon the merger with Oceanbulk in July 2014 in connection with the newbuilding vessel.

During the third quarter of 2015, we recognized an aggregate loss on a sale of vessels of $7.1 million in connection with the sale of the vessels Star Natalie, Star Claudia and Maiden Voyage. Total proceeds from these sales were $27.9 million.

Interest and finance costs for the third quarters of 2015 and 2014 were $7.7 million and $1.5 million, respectively. The increase is attributable to the higher average balance of our outstanding indebtedness of $1,000.1 million for the third quarter of 2015, including $50.0 million under the 8.00% Senior Notes and under our capital lease obligations, compared to $481.5 million for the third quarter of 2014. In addition, for the third quarter of 2015, interest and finance costs included $0.4 million of realized loss on hedging interest rate swaps compared to $0.01 million in the third quarter of 2014. Interest and finance costs incurred in the third quarters of 2015 and 2014 were set-off with interest capitalized from general debt of $3.0 million and $3.1 million, respectively, in connection with the payments made for our newbuilding vessels.

Loss on derivative financial instruments for the third quarter of 2015 was $3.6 million, compared to a gain of $0.02 million in the third quarter of 2014. Our hedge effectiveness test for the second quarter of 2015 indicated that the hedging relationship of certain of our interest rate swaps no longer qualified for special hedge accounting and therefore these were de-designated as accounting cash flow hedges as of April 1, 2015. Accordingly, realized and unrealized gains/losses from these swaps from April 1, 2015 onwards have been recorded in our statement of operations under Loss on derivative financial instruments, as opposed to interest and finance cost and equity, respectively, during the period that these swaps qualified for hedge accounting. The realized and unrealized losses from these swaps for the third quarter of 2015 were $3.6 million. Loss on derivative financial instruments during the third quarter of 2014 represents the non-cash loss from the mark to market valuation of our interest rate swaps outstanding during that period, which had not been designated as cash flow hedges.

 

 

(*)	Amounts relating to variations in period-on-period comparisons shown in this section are derived from the actual numbers in our books and records

For the nine months ended September 30, 2015, total voyage revenues were $169.9 million, compared to $79.5 million for the same period in 2014. This increase was mainly due to the increase of the average number of our vessels to 68.7 in the nine months ended September 30, 2015, from 21.5 vessels in the same period in 2014. The increase in voyage revenues from the additional vessels was partially offset by significantly lower charterhire rates prevailing in the dry bulk market during the nine months ended September 30, 2015, compared to the same period in 2014.

Management fee income during the nine months ended September 30, 2015 was $0.2 million compared to $2.2 million for the same period in 2014. This decrease was mainly due to the decrease in the average number of third-party vessels under management to 1.0 vessel in the nine months ended September 30, 2015, from 10.7 vessels in the same period in 2014. As a result of the acquisition of Oceanbulk, 11 Oceanbulk vessels that had been under our management became part of our fleet as of July 11, 2014. We, therefore, stopped receiving fees for the management of these vessels.

For the nine months ended September 30, 2015, operating loss was $121.4 million, compared to operating income of $1.3 million for the same period in 2014, primarily due to the combination of:

—	an increase in the average number of vessels in our fleet;

—	lower charterhire rates for dry bulk carrier vessels in the nine months ended September 30, 2015;

—	a non-cash vessel impairment loss and a loss from sale of vessels of $34.3 million and $20.5 million, respectively, recognized during the nine months ended September 30, 2015, which are described in more detail below;

—	a non-cash gain from bargain purchase of $12.3 million recognized in 2014 as a result of the acquisition of Oceanbulk; and

—	other operational gain of $9.4 million in the third quarter 2014, consisting of:

(i)

gain of $8.0 million from the sale to a third party of our claim against the previous charterer of the Star Borealis for charter party repudiation due to early redelivery of the vessel, which was collected in full in October 2014; and

(ii)

$1.4 million from the extinguishment of the liability to the previous charterer of Star Borealis, related to the amount of fuel and lubricants remaining on the board at the time of the charter repudiation.

Net loss for the nine months ended September 30, 2015 was $147.2 million, or $0.78 loss per basic and diluted share, calculated based on 187,704,877 weighted average number of basic and diluted shares. Net loss for the same period in 2014 was $3.6 million, or $0.08 loss per basic and diluted share, based on 45,236,873 weighted average number of basic and diluted shares.

Net loss for the nine months ended September 30, 2015 included the following non-cash items:

 

Excluding these non-cash items, net loss for the nine-month period ended September 30, 2015 would have been $77.1 million, or $0.41 loss per basic and diluted share, based on 187,704,877 weighted average number of basic and diluted shares.

Net loss for the nine-month period ended September 30, 2014 included mainly the following non-cash items:

—

Amortization of fair value of above market acquired time charters of $4.5 million, or $0.10 per basic and diluted share, associated with time charters attached to four vessels (Star Big, Star Mega, Amami and Madredeus). These above market time charters are amortized over the duration of the respective charters as a decrease to voyage revenues;

—	Expenses of $4.8 million, or $0.11 per basic and diluted share, relating to stock-based compensation expenses recognized in connection with the shares issued to directors and employees;

—	Unrealized loss of $0.9 million, or $0.02 per basic and diluted share, in connection with the mark to market valuation of our derivatives, which had not been designated as cash flow hedges;

·	A loss on bad debts of $0.2 million, or $0.01 per basic and diluted share, associated with the write-off of disputed charterer balances;

—	A gain of $1.4 million, or $0.03 per basic and diluted share, in connection with the extinguishment of liability to the previous charterer of Star Borealis, relating to the amount of fuel and lubricants remaining on board the vessel at the time of the charter repudiation; and

—	A gain from bargain purchase of $12.3 million, or $0.27 per basic and diluted share, resulting from the acquisition of Oceanbulk and the Pappas Companies.

In addition, net loss for the nine months ended September 30, 2014 included non-recurring transaction costs of $9.3 million, or $0.21 per basic and diluted share, in connection with the the acquisition of Oceanbulk.

Excluding these non-cash items and the non-recurring transaction costs, net income for the nine months ended September 30, 2014 would have been $2.4 million, or $0.05 earnings per basic and diluted share, based on 45,236,873 weighted average number of basic and diluted shares.

Adjusted EBITDA for the nine months ended September 30, 2015 and 2014 was $6.8 million and $27.1 million, respectively. A reconciliation of EBITDA and adjusted EBITDA to net cash provided by cash flows from operating activities is set forth below.

During the nine months ended September 30, 2015 and 2014, we owned and operated an average of 68.7 and 21.5 vessels, respectively, earning an average TCE rate of $8,130 and $12,813 per day, respectively. We refer you to footnote 8 under the heading "Summary of Selected Data" set forth below for information regarding our calculation of TCE rates.

For the nine months ended September 30, 2015, voyage expenses were $52.3 million, compared to $20.7 million for the same period in 2014. The increase in voyage expenses was due to the increase in the average number of

 

vessels in the nine months ended September 30, 2015, as well as the increased level of spot market activity, which is associated with higher voyage expenses than time charters.

For the nine months ended September 30, 2015 and 2014, vessel operating expenses totalled $86.3 million and $31.1 million, respectively. The increase in operating expenses was mainly due to higher average number of vessels in the nine months ended September 30, 2015 compared to the same period in 2014. Our average daily operating expenses per vessel for the nine months ended September 30, 2015 were $4,602, compared to $5,302 during the same period in 2014, representing a 13.2% reduction as a result of synergies and economies of scale from operating a larger fleet. In addition, vessel operating expenses for the nine months ended September 30, 2015 and 2014 included $5.2 million and $1.5 million of pre-delivery expenses respectively, which related to the initial crew manning and the initial supply of stores for our vessels upon delivery. Excluding these amounts, our average daily operating expenses per vessel for the nine months ended September 30, 2015 and 2014 were $4,325 and $5,046, respectively, representing an even higher reduction of 14.3%.

Dry docking expenses for the nine months ended September 30, 2015 and 2014 amounted to $13.1 million and $4.9 million, respectively. During the nine months ended September 30, 2015, 21 of our vessels underwent their periodic dry docking surveys, compared to three vessels in the same period in 2014.

Depreciation expense increased to $60.2 million for the nine months ended September 30, 2015, compared to $20.5 million for the same period in 2014. The increase was due to the higher average number of vessels in the nine months ended September 30, 2015 compared to the same period in 2014, which was partially offset by an increase in the estimated scrap rate per light weight ton from $200 to $300, which became effective as of January 1, 2015, following our management's reassessment based on the historical average demolition prices prevailing in the market.

Management fees for the nine months ended September 30, 2015 and 2014 were $6.4 million and $0.1 million, respectively. As of January 1, 2015, we engaged SPS to provide our fleet with certain procurement and remote vessel performance monitoring services at a daily fee of $295 per vessel. SPS will provide procurement and remote vessel performance monitoring services to a fleet of over 120 vessels. We expect to benefit from lower operating expenses and dry docking costs through the economies of scale that SPS will enjoy in managing such a large fleet. In addition, three of the Excel Vessels (Star Martha, Star Pauline and Star Despoina), which were acquired with attached time charter agreements, were managed by Maryville until the expiration of their existing time charter agreements (two of which expired in August and one of which expired in November 2015) at a monthly fee of $17,500 per vessel.

During the nine months ended September 30, 2015, we had $16.7 million of general and administrative expenses, compared to $25.0 million during the same period in 2014. The decrease was mainly due to non-recurring transaction costs of $9.3 million, which we incurred during the nine months ended September 30, 2014 in connection with the acquisition of Oceanbulk, and stock-based compensation expenses of $1.8 million, also incurred during the nine months ended September 30, 2014, relating to a severance payment to our former Chief Executive Officer. Our average daily net cash general and administrative expenses per vessel for the nine months ended September 30, 2015 were $1,112, compared to $1,485 during the same period in 2014. This reduction was achieved despite the increase in wage expenses resulting from a 47% increase in our number of employees during the nine months ended September 30, 2015 as compared to the same period in 2014.

During the nine months ended September 30, 2015, we recorded an impairment loss of an aggregate of $34.3 million relating to: (i) the sale of the vessel Star Monika (which was delivered to its new owners in April 2015); (ii) an agreement to sell one of our newbuilding vessels upon its delivery to us in 2016; (iii) an agreement to sell the vessel Maiden Voyage (which was delivered to its new owners in September 2015); (iv) the agreement to sell the vessel Star Nicole (which was delivered to its new owners in October 2015) and (v) two agreements to reassign the corresponding leases for two newbuilding vessels back to the vessels' owners for a one-time payment to the Company of $5.8 million each. Of this $34.3 million impairment loss, $20.7 million was due to the write-off of the fair value adjustment to the carrying value of these vessels recognized upon the merger with Oceanbulk in July 2014.

 

 

During the nine months ended September 30, 2015, we recognized a $2.1 million write-off of the unamortized fair value of the above market acquired time charter of the vessel Star Big due to its redelivery prior to the end of its time charter in connection with its sale and delivery to its new owners in June 2015.

During the nine months ended September 30, 2015 we recognized an aggregate loss on a sale of vessels of $20.5 million in connection with the sale of the vessels Star Kim, Star Julia, Star Tatianna, Rodon, Star Big, Star Mega, Star Christianna, Star Natalie, Star Claudia and Maiden Voyage. Total proceeds from these sales were $67.9 million, of which $1.1 million was received in 2014 as an advance for the sale of the vessel Star Kim.

Interest and finance costs for the nine months ended September 30, 2015 and 2014 were $21.6 million and $4.6 million, respectively. The increase is attributable to the higher average balance of our outstanding indebtedness of $940.4 million for the nine months ended September 30, 2015, including $50.0 million under the 8.00% Senior Notes and under our capital lease obligations, compared to $318.0 million for the same period in 2014. In addition, for the nine months ended September 30, 2015, interest and finance costs included $1.9 million of realized loss on hedging interest rate swaps compared to $0.01 million in the same period in 2014. Interest and finance costs incurred in the nine months ended September 30, 2015 and 2014 were set-off with interest capitalized from general debt of $9.2 million and $4.4 million, respectively, in connection with the payments made for our newbuilding vessels.

During the nine months ended September 30, 2015, we recorded $1.0 million of loss on debt extinguishment in connection with the non-cash write off of unamortized deferred finance charges due to prepayments of certain of our loan facilities.

We recorded a loss on derivative financial instruments for the nine months ended September 30, 2015 of $4.3 million, which included realized and unrealized gains/losses from swaps that were de-designated as accounting cash flow hedges from April 1, 2015 (date of de-designation). Loss on derivative financial instruments of $0.8 million during the nine months ended September 30, 2014 represented the non-cash loss from the mark to market valuation of four interest rate swaps outstanding during that period, which had not been designated as cash flow hedges.

 

 

For the nine months ended September 30, 2015, net cash used in investing activities consisted of:

·	$31.4 million paid for advances and other capitalized expenses for our newbuilding vessels;

—	$198.5 million paid for the acquisition of secondhand vessels (including certain Excel Vessels);

·	$0.4 million for the acquisition of other fixed assets;

·	$0.2 million paid to acquire 33% of the total outstanding common stock of Interchart Shipping Inc., a Liberian company that acts as a chartering broker to our fleet; and

·	a net increase of $10.8 million in restricted cash;

offset by:

·	$0.6 million of hull and machinery insurance proceeds; and

·	$96.3 million cash assumed as part of the acquisition of Oceanbulk and the Pappas Companies.

Net cash provided by financing activities for the nine months ended September 30, 2015 and 2014 was $556.4 million and $176.8 million, respectively.

For the nine months ended September 30, 2015, net cash provided by financing activities consisted of:

 

For the nine months ended September 30, 2014, net cash provided by financing activities consisted of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)	Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period.

(2)	As of the last day of the periods reported.

(3)	Average age of operational fleet is calculated as of September 30, 2015 and 2014, respectively.

(4)	Ownership days are the total calendar days each vessel in the fleet was owned by us for the relevant period.

(5)	Available days for the fleet are the ownership days after subtracting off-hire days for major repairs, dry docking or special or intermediate surveys.

(6)	Voyage days are the total days the vessels were in our possession for the relevant period after subtracting off-hire days incurred for any reason (including off-hire for major repairs, dry docking, special or intermediate surveys).

(7)	Fleet utilization is calculated by dividing voyage days by available days for the relevant period. Ballast days for which a charter is not fixed are not included in the voyage days for the fleet utilization calculation.

(8)

Represents the weighted average daily TCE rates of our entire fleet. TCE rate is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE rate is determined by dividing voyage revenues (net of voyage expenses and amortization of fair value of above/below market acquired time charter agreements) by voyage days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract, as well as commissions. TCE rate is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance despite changes in the mix of charter types (i.e., voyage charters, time charters and bareboat charters) under its vessels may be employed between the periods. We included TCE revenues, a non- GAAP measure, as it provides additional meaningful information in conjunction with voyage revenues, the most directly comparable GAAP measure, and it assists our management in making decisions regarding the deployment and use of our vessels and in evaluating our financial performance.

(9)	Average daily OPEX per vessel is calculated by dividing vessel operating expenses by ownership days.

(10)	Average daily Net Cash G&A expenses per vessel is calculated by deducting (1) the Management fee Income from, and (2) adding the Management fee expense to, the General and Administrative expenses(net of stock based compensation expense) and (3) then dividing with the ownership days.

 

 

 

*As of September 30, 2015, we had paid the delivery installment for our newbuilding vessel Star Antares which was partially financed by $16.7 million drawn down on September 29, 2015, under the Sinosure Facility and the remaining amount was financed using existing cash. The vessel, however, was delivered to us on October 9, 2015. As a result, the entire amount paid for this vessel is included under the line “Advances for vessels under construction and acquisition of vessels and other assets”.

 

 

 

 

 

 

 

 

We consider EBITDA to represent net income before interest, income taxes, depreciation and amortization. EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of EBITDA may not be comparable to that reported by other companies. EBITDA is included herein because it is a basis upon which we assess our liquidity position, it is used by our lenders as a measure of our compliance with certain loan covenants and because we believe that it presents useful information to investors regarding our ability to service and/or incur indebtedness.

We excluded non-cash gains/losses such as those related to sale of vessels, loss on bad debt, the unrealized gains/losses on derivative instruments, stock-based compensation expense, the write off of the unamortized fair value of above market acquired time charters, vessel impairment losses, the gain from bargain purchase, the equity in income of investee and various non-recurring items, such as the transaction costs incurred in connection with the acquisition of Oceanbulk and the Pappas Companies, to derive adjusted EBITDA. We excluded the above described items to derive adjusted EBITDA, because we believe that these items do not reflect the ongoing operational cash inflows and outflows of our fleet.

 

 

 

 

 

 

The following table reconciles net cash provided by operating activities to EBITDA and adjusted EBITDA:

 

 

 

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