DryShips Inc. (NASDAQ:DRYS) (“DryShips” or the “Company”), a
diversified owner and operator of ocean going cargo vessels, today
announced its unaudited financial and operating results for the
quarter ended March 31, 2019.
First Quarter 2019 Financial
Highlights
- For the first quarter of 2019, the Company reported net income
of $1.5 million, or 1.67 cents basic and diluted earnings per
share.Included in the first quarter of 2019 results are:-- Vessel
dry-docking costs of $0.7 million, or 0.78 cents per shareExcluding
the above, the Company’s net results would have amounted to a net
income of $2.2 million, or 2.45 cents per share.
- The Company reported Adjusted EBITDA of $13.1 million for the
first quarter of 2019.(1)
Other
Developments
- Common Stock Repurchase Program
As of May 15, 2019, the Company has not repurchased
any additional shares of its common stock since its last update.
Under the previously announced new stock repurchase program, the
Company may repurchase up to $12.8 million of its outstanding
common shares by October 29, 2019.
- Future Proofing of the Company’s Fleet
During 2019, the Company has scheduled and started
implementing an overall “future proofing plan” for its fleet by
performing dry-dockings, installation of scrubbers and installation
of ballast water systems. As a result, the Company expects during
the period from 2019 to 2020 to incur approximately between
1,100-1,300 off-hire days for a total estimated cost of
approximately $80.0 million-$100.0 million.
- 2019 Annual General Meeting of Shareholders
On May 15, 2019, the Company’s Board of Directors
resolved that the Company’s 2019 Annual General Meeting of
Shareholders (the “Annual Meeting”) be held at the offices of
DryShips Management Services Inc. located at 109 Kifisias Avenue
& Sina Street, GR 151 24, Marousi, Athens, Greece on Monday,
July 22, 2019 at 4:00 p.m., local time. The Company’s Board of
Directors fixed the close of business on Monday, June 10, 2019, as
the record date for the determination of the shareholders entitled
to receive notice and to vote at the Annual Meeting or any
adjournments or postponements thereof. Formal notice of the Annual
Meeting and the Company’s proxy statement are expected to be sent
to shareholders on or before Monday, July 1, 2019.
_____________(1) Adjusted EBITDA is a non-U.S.
GAAP measure; please see later in this press release for
reconciliation to net income.
Fleet List
The table below describes the Company’s fleet as of May 15,
2019:
|
Year |
|
Gross rate |
Redelivery |
|
Built |
DWT |
Per day |
Earliest |
Latest |
Drybulk
fleet |
|
|
|
|
|
|
|
|
|
|
|
Newcastlemax: |
|
|
|
|
|
Bacon |
2013 |
205,170 |
T/C Index Linked |
Sep-19 |
Oct-19 |
Conquistador* |
2016 |
209,090 |
T/C Index Linked |
N/A |
N/A |
Huahine |
2013 |
206,037 |
T/C Index Linked |
Sep-19 |
Oct-19 |
Judd |
2015 |
205,796 |
T/C Index Linked |
Sep-19 |
Oct-19 |
Marini* |
2014 |
205,854 |
T/C Index Linked |
Oct-19 |
Dec-19 |
Morandi |
2013 |
205,854 |
T/C Index Linked |
Aug-19 |
Sep-19 |
Pink Sands* |
2016 |
208,931 |
T/C Index Linked |
N/A |
N/A |
Xanadu* |
2017 |
208,827 |
T/C Index Linked |
N/A |
N/A |
|
|
|
|
|
|
Kamsarmax: |
|
|
|
|
|
Castellani |
2014 |
82,129 |
Spot |
N/A |
N/A |
Kelly |
2017 |
81,300 |
Spot |
N/A |
N/A |
Matisse |
2014 |
81,128 |
Spot |
N/A |
N/A |
Nasaka |
2014 |
81,918 |
Spot |
N/A |
N/A |
Valadon |
2014 |
81,198 |
Spot |
N/A |
N/A |
|
|
|
|
|
|
Panamax: |
|
|
|
|
|
Catalina |
2005 |
74,432 |
Spot |
N/A |
N/A |
Levanto |
2001 |
73,925 |
Spot |
N/A |
N/A |
Ligari |
2004 |
75,583 |
Spot |
N/A |
N/A |
Majorca |
2005 |
74,477 |
Spot |
N/A |
N/A |
Rapallo |
2009 |
75,123 |
Spot |
N/A |
N/A |
Raraka |
2012 |
76,037 |
Spot |
N/A |
N/A |
|
|
|
|
Tanker
fleet |
|
|
|
|
|
|
|
|
|
|
|
Very Large Crude
Carrier: |
|
|
|
|
|
Shiraga |
2011 |
320,105 |
Spot |
N/A |
N/A |
|
|
|
|
|
|
Suezmax: |
|
|
|
|
|
Marfa |
2017 |
159,513 |
Spot |
N/A |
N/A |
Samsara** |
2017 |
159,855 |
$18,000 Base rate plus profit share |
Mar.-22 |
May-25 |
|
|
|
|
|
|
Aframax: |
|
|
|
|
|
Balla |
2017 |
113,293 |
Spot |
N/A |
N/A |
Botafogo |
2010 |
106,892 |
Spot |
N/A |
N/A |
Stamos |
2012 |
115,666 |
Spot |
N/A |
N/A |
|
|
|
|
|
|
|
|
|
|
|
|
Offshore Supply
fleet |
|
|
|
|
|
|
|
|
|
|
|
Platform Supply
Vessels: |
|
|
|
|
|
Crescendo |
2012 |
1,457 |
Laid up |
N/A |
N/A |
Colorado |
2012 |
1,430 |
Laid up |
N/A |
N/A |
Oil Spill Recovery
Vessels: |
|
|
|
|
|
Indigo |
2013 |
1,401 |
Laid up |
N/A |
N/A |
Jacaranda |
2012 |
1,360 |
Laid up |
N/A |
N/A |
Emblem |
2012 |
1,363 |
Laid up |
N/A |
N/A |
Jubilee |
2012 |
1,317 |
Laid up |
N/A |
N/A |
|
|
|
|
|
|
* The vessel is time chartered by TMS Dry Ltd., an
entity that may be deemed to be beneficially owned by our Company’s
Chairman and CEO.
** The vessel is time chartered by Cecilia
Shipholdings Limited, an entity that may be deemed to be
beneficially owned by our Company’s Chairman and CEO.
Drybulk, Tanker and Gas Carrier Segments Summary
Operating Data (unaudited) (U.S. Dollars in thousands,
except average daily results)
Drybulk |
Three Months Ended March 31, |
|
2018 |
|
2019 |
Average number of
vessels(1) |
21.0 |
|
19.0 |
Total voyage days for
vessels(2) |
1,890 |
|
1,709 |
Total calendar days for
vessels(3) |
1,890 |
|
1,710 |
Fleet utilization(4) |
100.0% |
|
99.9% |
Time charter
equivalent(5) |
$11,315 |
|
$9,994 |
Vessel operating expenses
(daily)(6) |
$6,134 |
|
$5,595 |
Tanker |
Three Months Ended March 31, |
|
2018 |
|
2019 |
Average number of
vessels(1) |
4.0 |
|
6.0 |
Total voyage days for
vessels(2) |
360 |
|
540 |
Total calendar days for
vessels(3) |
360 |
|
540 |
Fleet utilization(4) |
100.0% |
|
100.0% |
Time charter
equivalent(5) |
$19,717 |
|
$28,694 |
Vessel operating expenses
(daily)(6) |
$7,861 |
|
$6,874 |
Gas
Carrier |
Three Months Ended March 31, |
|
2018 |
|
2019 |
Average number of
vessels(1) |
3.9 |
|
- |
Total voyage days for
vessels(2) |
350 |
|
- |
Total calendar days for
vessels(3) |
350 |
|
- |
Fleet utilization(4) |
100.0% |
|
- |
Time charter
equivalent(5) |
$28,243 |
|
- |
Vessel operating expenses
(daily)(6) |
$9,737 |
|
- |
(1) Average number of vessels is the number of
vessels that constituted the Company’s fleet for the relevant
period, as measured by the sum of the number of days each vessel
was a part of the Company’s fleet during the period divided by the
number of calendar days in that period.
(2) Total voyage days for vessels are the total
days the vessels were in the Company’s possession for the relevant
period net of off-hire days associated with drydockings or special
or intermediate surveys and laid-up days.
(3) Total calendar days are the total number of
days the vessels were in the Company’s possession for the relevant
period including off-hire days associated with drydockings or
special or intermediate surveys and laid-up days.
(4) Fleet utilization is the percentage of time
that the Company’s vessels were available for revenue generating
voyage days, and is determined by dividing voyage days by fleet
calendar days for the relevant period.
(5) Time charter equivalent, or TCE, is a measure
of the average daily revenue performance of a vessel on a per
voyage basis. The Company’s method of calculating TCE is consistent
with industry standards and is determined by dividing voyage
revenues (net of voyage expenses) 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 and are paid by
the charterer under a time charter contract, as well as
commissions. TCE revenues, a non-U.S. GAAP measure, provides
additional meaningful information in conjunction with revenues from
the Company’s vessels, the most directly comparable U.S. GAAP
measure, because it assists the Company’s management in making
decisions regarding the deployment and use of its vessels and in
evaluating their financial performance. TCE is also 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., spot charters,
time charters and bareboat charters) under which the vessels may be
employed between the periods. Please see below for a reconciliation
of TCE rates to voyage revenues.
(6) Daily vessel operating expenses, which includes
crew costs, provisions, deck and engine stores, lubricating oil,
insurance, maintenance and repairs including dry-docking costs, is
calculated by dividing vessel operating expenses by fleet calendar
days net of laid-up days for the relevant time period.
Drybulk, Tanker and Gas Carrier Segments
Summary Operating Data (unaudited) - continued (In
thousands of U.S. dollars, except for TCE rate, which is expressed
in U.S. Dollars, and voyage days)
Drybulk |
|
Three Months Ended March 31, |
|
|
2018 |
|
|
2019 |
Voyage revenues |
$ |
23,276 |
|
$ |
19,211 |
Voyage expenses |
|
(1,891) |
|
|
(2,131) |
Time charter equivalent revenues |
$ |
21,385 |
|
$ |
17,080 |
Total voyage days for fleet |
|
1,890 |
|
|
1,709 |
Time charter equivalent (TCE) |
$ |
11,315 |
|
$ |
9,994 |
Tanker |
|
Three Months Ended March 31, |
|
|
2018 |
|
|
2019 |
Voyage revenues |
$ |
11,157 |
|
$ |
23,869 |
Voyage expenses |
|
(4,059) |
|
|
(8,374) |
Time charter equivalent
revenues |
$ |
7,098 |
|
$ |
15,495 |
Total voyage days for
fleet |
|
360 |
|
|
540 |
Time charter equivalent
(TCE) |
$ |
19,717 |
|
$ |
28,694 |
Gas
Carrier |
|
Three Months Ended March 31, |
|
|
2018 |
|
|
2019 |
Voyage revenues |
$ |
10,293 |
|
$ |
- |
Voyage expenses |
|
(408) |
|
|
- |
Time charter equivalent
revenues |
$ |
9,885 |
|
$ |
- |
Total voyage days for
fleet |
|
350 |
|
|
- |
Time charter equivalent
(TCE) |
$ |
28,243 |
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
DryShips Inc. |
|
Financial Statements |
Unaudited Condensed Consolidated Statements of
Operations |
|
(Expressed in Thousands of U.S. Dollars except for share and per
share data) |
|
Three Months Ended March 31, |
|
|
2018 |
|
2019 |
|
|
|
|
|
REVENUES: |
|
|
|
|
Voyage revenues |
$ |
44,726 |
|
$ |
43,080 |
|
|
|
44,726 |
|
|
43,080 |
|
|
|
|
|
|
EXPENSES: |
|
|
|
|
Voyage expenses |
|
6,358 |
|
|
10,505 |
|
Vessel operating expenses |
|
18,100 |
|
|
13,403 |
|
Depreciation |
|
6,818 |
|
|
7,337 |
|
General and administrative
expenses |
|
7,169 |
|
|
6,820 |
|
Other, net |
|
(18 |
) |
|
125 |
|
|
|
|
|
|
Operating
income |
|
6,299 |
|
|
4,890 |
|
|
|
|
|
|
OTHER
EXPENSES: |
|
|
|
|
Interest and finance costs,
net of interest income |
|
(4,890 |
) |
|
(3,668 |
) |
Other, net |
|
(183 |
) |
|
229 |
|
Total other expenses,
net |
|
(5,073 |
) |
|
(3,439 |
) |
|
|
|
|
|
Net
income |
|
1,226 |
|
|
1,451 |
|
|
|
|
|
|
Net income attributable to
DryShips Inc. common stockholders |
|
1,226 |
|
|
1,451 |
|
Earnings per common share,
basic and diluted |
$ |
0.01 |
|
$ |
0.02 |
|
Weighted average number of
shares, basic and diluted |
|
103,682,222 |
|
|
86,899,873 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DryShips Inc. |
|
Unaudited Condensed Consolidated Balance
Sheets |
|
|
(Expressed in Thousands of U.S. Dollars except for share
data) |
|
December 31, 2018 |
|
|
March 31, 2019 |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents, including restricted cash (current
and non-current) |
$ |
156,881 |
|
$ |
151,139 |
|
Other current and non-current assets |
|
99,092 |
|
|
102,205 |
|
Vessels, net |
|
755,332 |
|
|
747,995 |
|
Total assets |
|
1,011,305 |
|
|
1,001,339 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt and finance lease liabilities |
|
362,047 |
|
|
354,789 |
|
Total other liabilities |
|
11,529 |
|
|
9,558 |
|
Total stockholders’ equity |
|
637,729 |
|
|
636,992 |
|
Total liabilities and stockholders’
equity |
$ |
1,011,305 |
|
$ |
1,001,339 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHARE COUNT DATA |
|
|
|
|
|
|
Common
stock issued |
|
104,274,708 |
|
|
|
104,274,708 |
|
Less: Treasury stock |
|
(17,042,680) |
|
|
|
(17,388,081) |
|
Common stock issued and outstanding |
|
87,232,028 |
|
|
|
86,886,627 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Reconciliation
Adjusted EBITDA represents earnings before
interest, taxes, depreciation and amortization, vessel sales and
impairments and certain other non-cash items as described below.
Adjusted 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, and the Company’s calculation of adjusted EBITDA may
not be comparable to that reported by other companies. Adjusted
EBITDA is included herein because it is a basis upon which the
Company measures its operations. Adjusted EBITDA is also used by
the Company’s lenders as a credit metric and the Company believes
that it presents useful information to investors regarding a
company’s ability to service and/or incur indebtedness.
The following table reconciles net income to
Adjusted EBITDA:
(Expressed in Thousands of U.S. Dollars) |
|
|
Three Months Ended March 31, |
|
|
|
2018 |
|
|
2019 |
|
|
|
|
|
|
|
Net income |
|
$ |
1,226 |
|
$ |
1,451 |
|
|
|
|
|
|
|
Add: Net interest expense |
|
|
4,890 |
|
|
3,668 |
Add: Depreciation |
|
|
6,818 |
|
|
7,337 |
Add: Dry-dockings |
|
|
389 |
|
|
675 |
Add: Income taxes |
|
|
- |
|
|
1 |
Adjusted EBITDA |
|
$ |
13,323 |
|
$ |
13,132 |
|
|
|
|
|
|
|
About DryShips Inc.
The Company is a diversified owner and operator of
ocean going cargo vessels that operate worldwide. As of May 15,
2019, and not giving effect to any pending vessel transactions, the
Company operates a fleet of 31 vessels comprised of (i) 6 Panamax
drybulk vessels; (ii) 8 Newcastlemax drybulk vessels; (iii) 5
Kamsarmax drybulk vessels; (iv) 1 Very Large Crude Carrier; (v) 3
Aframax tankers; (vi) 2 Suezmax tankers; and (vii) 6 Offshore
Support Vessels, including 2 Platform Supply and 4 Oil Spill
Recovery Vessels.
DryShips’ common stock is listed on the NASDAQ
Capital Market where it trades under the symbol “DRYS.”
Visit the Company’s website at
www.dryships.com
Forward-Looking Statement
Matters discussed in this press release may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. The Private
Securities Litigation Reform Act of 1995 provides safe harbor
protections for forward-looking statements in order to encourage
companies to provide prospective information about their business.
The Company desires to take advantage of the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995 and is
including this cautionary statement in connection with such safe
harbor legislation.
Forward-looking statements reflect the Company’s
current views with respect to future events and financial
performance and may include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements, which are other than
statements of historical facts.
The forward-looking statements in this release are
based upon various assumptions, many of which are based, in turn,
upon further assumptions, including without limitation,
management’s examination of historical operating trends, data
contained in the Company’s records and other data available from
third parties. Although the Company believes that these assumptions
were reasonable when made, because these assumptions are inherently
subject to significant uncertainties and contingencies which are
difficult or impossible to predict and are beyond the Company’s
control, the Company cannot assure you that it will achieve or
accomplish these expectations, beliefs or projections.
Important factors that, in the Company’s view,
could cause actual results to differ materially from those
discussed in the forward-looking statements include the strength of
world economies and currencies, general market conditions,
including changes in charter rates, utilization of vessels and
vessel values, failure of a seller or shipyard to deliver one or
more vessels, failure of a buyer to accept delivery of a vessel,
the Company’s inability to procure acquisition financing, default
by one or more charterers of the Company’s ships, changes in demand
for drybulk, oil or natural gas commodities, changes in demand that
may affect attitudes of time charterers, scheduled and unscheduled
drydockings, changes in the Company’s voyage and operating
expenses, including bunker prices, dry-docking and insurance costs,
changes in governmental rules and regulations, changes in the
Company’s relationships with the lenders under its debt agreements,
potential liability from pending or future litigation, domestic and
international political conditions, potential disruption of
shipping routes due to accidents, international hostilities and
political events or acts by terrorists.
Risks and uncertainties are further described in
reports filed by DryShips with the U.S. Securities and Exchange
Commission, including the Company’s most recently filed Annual
Report on Form 20-F.
Investor Relations / Media:
Nicolas BornozisCapital Link, Inc. (New York)Tel.
212-661-7566E-mail: dryships@capitallink.com
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