Star Bulk Carriers Corp. (the "Company" or "Star Bulk") (Nasdaq and
Oslo: SBLK), a global shipping company focusing on the
transportation of dry bulk cargoes, today announced its unaudited
financial and operating results for the fourth quarter and year
ended December 31, 2018.
Financial Highlights
|
|
|
|
|
|
(Expressed in thousands of U.S. dollars, except for daily rates
and per share data) |
|
|
|
|
|
Fourth quarter 2018 |
Fourth quarter 2017 |
Twelve months ended December 31,
2018 |
Twelve months ended December 31,
2017 |
|
Voyage Revenues |
$209,433 |
|
$107,707 |
|
$651,561 |
|
$331,976 |
|
|
Net income/(loss) |
$12,315 |
|
$23,884 |
|
$58,997 |
|
($9,771 |
) |
|
Net cash provided by operating activities |
$59,836 |
|
$44,329 |
|
$169,009 |
|
$82,804 |
|
|
EBITDA (1) |
$63,575 |
|
$58,378 |
|
$233,015 |
|
$121,508 |
|
|
Adjusted EBITDA (1) |
$82,379 |
|
$55,690 |
|
$260,887 |
|
$128,048 |
|
|
Adjusted Net income / (loss) (2) |
$30,316 |
|
$21,535 |
|
$86,098 |
|
($4,301 |
) |
|
Earnings / (loss) per share basic |
$0.13 |
|
$0.37 |
|
$0.77 |
|
($0.16 |
) |
|
Adjusted earnings / (loss) per share basic (2) |
$0.33 |
|
$0.34 |
|
$1.12 |
|
($0.07 |
) |
|
TCE Revenues (3) |
$137,800 |
|
$90,019 |
|
$437,069 |
|
$262,661 |
|
|
Daily Time Charter Equivalent Rate ("TCE") (3) |
$14,140 |
|
$13,860 |
|
$13,768 |
|
$10,393 |
|
|
Fleet utilization |
|
98.6 |
% |
|
100.0 |
% |
|
99.0 |
% |
|
99.6 |
% |
|
Average daily OPEX per vessel (4) |
$3,938 |
|
$3,911 |
|
$4,027 |
|
$3,995 |
|
|
Average daily OPEX per vessel (excl. pre-delivery expenses)
(4) |
$3,938 |
|
$3,850 |
|
$3,994 |
|
$3,906 |
|
|
Average daily Net Cash G&A expenses per vessel (excluding
one-time expenses) (5) |
$969 |
|
$1,094 |
|
$1,004 |
|
$1,094 |
|
|
|
|
|
|
|
|
- EBITDA and Adjusted EBITDA are non-GAAP measures. Please see
the table at the end 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”). To derive
Adjusted EBITDA from EBITDA, we exclude non-cash gains /
(losses).
- Adjusted Net income / (loss) and Adjusted earnings / (loss) per
share basic and diluted are non-GAAP measures. Please see the table
at the end of this release for a reconciliation to Net income /
(loss), which is the most directly comparable financial measure
calculated and presented in accordance with U.S. GAAP.
- Daily Time Charter Equivalent Rate (“TCE”) and TCE Revenues are
non-GAAP measures. Please see the table at the end of this release
for a reconciliation to Voyage Revenues, which is the most directly
comparable financial measure calculated and presented in accordance
with U.S. GAAP.
- Average daily OPEX per vessel is calculated by dividing vessel
operating expenses by Ownership days.
- Average daily Net Cash G&A expenses per vessel is
calculated by (1) deducting the Management fee Income (if any),
from, and (2) adding the Management fee expense to, the
General and Administrative expenses (net of stock-based
compensation expense) and (3) then dividing the result by the
sum of Ownership days and Charter-in days. Please see the table at
the end of this release for a reconciliation to General and
administrative expenses, which is the most directly comparable
financial measure calculated and presented in accordance with U.S.
GAAP.
Petros Pappas, Chief Executive Officer
of Star Bulk, commented: “This is our fifth consecutive
profitable quarter, as we achieved $12.3 million Net Income. This
figure also includes a non-cash charge of $17.8 million, related to
impairment for realized as well as expected vessel sales in 2019,
which if excluded, brings our Adjusted Net Income to $30.3 million.
Our voyage revenues for the fourth quarter of 2018 amount to $209.4
million, our average TCE for the quarter is $14,140/day per
vessel, while average OPEX per vessel are $3,938/day and average
Net Cash G&A expenses per vessel are $969/day, given our
continuous focus to keep costs low.
On a yearly basis we realized Net Income of
$59.0 million and Adjusted Net Income of $86.1 million. Our voyage
revenues for the year amount to $651.6 million, our average TCE is
$13,768/day per vessel, while average OPEX per vessel (excl.
pre-delivery expenses) are $3,994/day and average Net Cash G&A
expenses per vessel are $1,004/day.
As of today, we have fixed a minimum of 70% of
Q1 2019 days at average TCE rates of $12,954 per day.
During this quarter, we concluded the
refinancing of loans of approximately $248 million with new debt
with an average margin of 120 bps lower than the debt that we
refinanced. We remain committed to refinancing debt at lower
interest costs when such opportunities arise. We have also
committed financing for the procurement and installation of
scrubbers, of approximately $140 million, to be drawn during the
rollout of our program in 2019. Maintaining a large cash balance
remains a top priority for us.
We are currently completing the installation of
scrubbers on 15 of our larger vessels enabling us to have the vast
majority of our fleet fitted with scrubbers ahead of the January
1st 2020 implementation date.”
Recent Developments
DEBT FINANCING UPDATE
- On December 17, 2018, we entered into a loan agreement with ABN
AMRO BANK N.V. and Norddeutsche Landesbank Girozentrale (Nord LB),
the “ABN/NordLB $115 million Facility,” for an amount up to $115
million available in four tranches. The first tranche was used to
refinance the indebtedness of four of the Augustea Vessels, and the
remaining three tranches were used to partially finance the
acquisition cost of the three vessels purchased from entities
affiliated with E.R. Capital Holding GmbH & Cie KG., as
described below. The loan is secured by a first priority mortgage
on the seven vessels. All four tranches will mature in December
2023.
- On January 28 2019, we entered into a loan agreement with
Skandinaviska Enskilda Banken AB (SEB), the “SEB Facility,” for the
financing of an aggregate amount of $65.7 million, which was used
together with cash on hand to pay all the outstanding amount under
the lease agreements of M/V Star Laetitia and M/V Star Sienna, two
vessels acquired from Augustea. The SEB Facility is secured by a
first priority mortgage on the two vessels and will mature in
January 2025.
- On January 31, 2019, we entered into a loan agreement with E.
SUN Commercial Bank, Hong Kong branch, the “E.SUN Facility,” for
the financing of an amount up to $37.1 million to pay all
outstanding amount under the lease agreement of M/V Star Ariadne.
The E.SUN Facility is secured by first priority mortgage on the
respective vessel and will mature in February 2024.
VESSEL DELIVERIES’ UPDATE
- Pursuant to the previously announced transaction with E.R.
Capital Holding GmbH & Cie. KG, dated as of August 27, 2018, in
which we agreed to acquire three dry bulk vessels and received an
option to purchase another four dry bulk vessels, we took delivery
of two of the three committed dry bulk vessels, namely the 2010
built Capesize vessels M/V Star Marianne and M/V Star Janni on
January 7, 2019 and January 14, 2019, respectively.
- On January 8, 2019, we sold and delivered the vessel M/V Star
Delta, a 2001 built Supramax vessel, to her new buyers.
UPDATED SHARE COUNT
During the fourth quarter of 2018, we
repurchased 341,363 of our common shares in open market
transactions at an average price of $9.17 for aggregate
consideration of $3.1 million, pursuant to the previously announced
share repurchase program. All the repurchased shares were canceled
and removed from our share capital on January 3, 2019. Following
the deliveries of the last two vessels purchased from E.R. Capital
Holding GmbH & Cie. KG and the cancelation of the repurchased
shares, we have 93,285,322 common shares issued and outstanding as
of the date of this release.
Employment update
As of today, we have fixed employment for approximately 70% of
the days in Q1 2019 at average TCE rates of $12,954 per day.
More specifically:
Capesize / Newcastlemax Vessels: approximately 68% of Q1 2019
days at $16,223 per day.
Post Panamax / Kamsarmax / Panamax Vessels: approximately 69% of
Q1 2019 days at $11,792 per day.
Ultramax / Supramax Vessels: approximately 75% of Q1 2019
days at $11,306 per day.
Existing On the Water Fleet (As of February 11,
2019)
|
Vessel Name |
|
Vessel
Type |
|
Capacity (dwt.) |
|
Year Built |
|
Date Delivered to Star Bulk |
1 |
Goliath |
|
Newcastlemax |
|
209,537 |
|
2015 |
|
July-15 |
2 |
Gargantua |
|
Newcastlemax |
|
209,529 |
|
2015 |
|
April-15 |
3 |
Star Poseidon |
|
Newcastlemax |
|
209,475 |
|
2016 |
|
February-16 |
4 |
Maharaj |
|
Newcastlemax |
|
209,472 |
|
2015 |
|
July-15 |
5 |
Star Leo (1) |
|
Newcastlemax |
|
207,939 |
|
2018 |
|
May-18 |
6 |
ABOY Laetitia (1) |
|
Newcastlemax |
|
207,896 |
|
2017 |
|
August-18 |
7 |
Star Ariadne (1) |
|
Newcastlemax |
|
207,812 |
|
2017 |
|
March-17 |
8 |
Star Virgo (1) |
|
Newcastlemax |
|
207,810 |
|
2017 |
|
March-17 |
9 |
Star Libra (1) |
|
Newcastlemax |
|
207,765 |
|
2016 |
|
June-16 |
10 |
ABOY Sienna (1) |
|
Newcastlemax |
|
207,721 |
|
2017 |
|
August-18 |
11 |
Star Marisa (1) |
|
Newcastlemax |
|
207,709 |
|
2016 |
|
March-16 |
12 |
ABOY Karlie (1) |
|
Newcastlemax |
|
207,566 |
|
2016 |
|
August-18 |
13 |
Star Eleni (1) |
|
Newcastlemax |
|
207,555 |
|
2018 |
|
January-18 |
14 |
Star Magnanimus
(1) |
|
Newcastlemax |
|
207,490 |
|
2018 |
|
March-18 |
15 |
Leviathan |
|
Capesize |
|
182,511 |
|
2014 |
|
September-14 |
16 |
Peloreus |
|
Capesize |
|
182,496 |
|
2014 |
|
July-14 |
17 |
Star Claudine (1) |
|
Capesize |
|
181,258 |
|
2011 |
|
July-18 |
18 |
Star Ophelia (1) |
|
Capesize |
|
180,716 |
|
2010 |
|
July-18 |
19 |
Star Martha |
|
Capesize |
|
180,274 |
|
2010 |
|
October-14 |
20 |
Star Pauline |
|
Capesize |
|
180,274 |
|
2008 |
|
December-14 |
21 |
Pantagruel |
|
Capesize |
|
180,181 |
|
2004 |
|
July-14 |
22 |
Star Borealis |
|
Capesize |
|
179,678 |
|
2011 |
|
September-11 |
23 |
Star Polaris |
|
Capesize |
|
179,600 |
|
2011 |
|
November-11 |
24 |
Star Lyra (1) |
|
Capesize |
|
179,147 |
|
2009 |
|
July-18 |
25 |
Star Janni |
|
Capesize |
|
178,978 |
|
2010 |
|
January-19 |
26 |
Star Marianne |
|
Capesize |
|
178,906 |
|
2010 |
|
January-19 |
27 |
Star Angie |
|
Capesize |
|
177,931 |
|
2007 |
|
October-14 |
28 |
Big Fish |
|
Capesize |
|
177,662 |
|
2004 |
|
July-14 |
29 |
Kymopolia |
|
Capesize |
|
176,990 |
|
2006 |
|
July-14 |
30 |
Star Triumph |
|
Capesize |
|
176,343 |
|
2004 |
|
December-17 |
31 |
ABY Scarlett |
|
Capesize |
|
175,800 |
|
2014 |
|
August-18 |
32 |
Star Audrey |
|
Capesize |
|
175,125 |
|
2011 |
|
August-18 |
33 |
Big Bang |
|
Capesize |
|
174,109 |
|
2007 |
|
July-14 |
34 |
Star Aurora |
|
Capesize |
|
171,199 |
|
2000 |
|
September-10 |
35 |
Paola |
|
Mini-Capesize |
|
115,259 |
|
2011 |
|
August-18 |
36 |
ABML Eva |
|
Mini-Capesize |
|
106,659 |
|
2011 |
|
August-18 |
37 |
Amami |
|
Post Panamax |
|
98,681 |
|
2011 |
|
July-14 |
38 |
Madredeus |
|
Post Panamax |
|
98,681 |
|
2011 |
|
July-14 |
39 |
Star Sirius |
|
Post Panamax |
|
98,681 |
|
2011 |
|
March-14 |
40 |
Star Vega |
|
Post Panamax |
|
98,681 |
|
2011 |
|
February-14 |
41 |
Star Piera |
|
Post-Panamax |
|
91,952 |
|
2010 |
|
August-18 |
42 |
Star Despoina |
|
Post Panamax |
|
91,945 |
|
2010 |
|
August-18 |
Existing On the Water Fleet (As of February 11, 2019) -
continued
|
Vessel Name |
|
Vessel
Type |
|
Capacity (dwt.) |
|
Year Built |
|
Date Delivered to Star Bulk |
43 |
Star Aphrodite |
|
Post Panamax |
|
92,006 |
|
2011 |
|
August-18 |
44 |
Star Electra (1) |
|
Kamsarmax |
|
83,494 |
|
2011 |
|
July-18 |
45 |
Star Angelina |
|
Kamsarmax |
|
82,981 |
|
2006 |
|
December-14 |
46 |
ABY Jeannette |
|
Kamsarmax |
|
82,567 |
|
2014 |
|
August-18 |
47 |
Star Gwyneth |
|
Kamsarmax |
|
82,790 |
|
2006 |
|
December-14 |
48 |
Star Kamila |
|
Kamsarmax |
|
82,769 |
|
2005 |
|
September-14 |
49 |
Star Luna (1) |
|
Kamsarmax |
|
82,687 |
|
2008 |
|
July-18 |
50 |
Star Bianca (1) |
|
Kamsarmax |
|
82,672 |
|
2008 |
|
July-18 |
51 |
Pendulum |
|
Kamsarmax |
|
82,619 |
|
2006 |
|
July-14 |
52 |
Star Maria |
|
Kamsarmax |
|
82,598 |
|
2007 |
|
November-14 |
53 |
Star Markella |
|
Kamsarmax |
|
82,594 |
|
2007 |
|
September-14 |
54 |
Star Danai |
|
Kamsarmax |
|
82,574 |
|
2006 |
|
October-14 |
55 |
Star Georgia |
|
Kamsarmax |
|
82,298 |
|
2006 |
|
October-14 |
56 |
Star Sophia |
|
Kamsarmax |
|
82,269 |
|
2007 |
|
October-14 |
57 |
Star Mariella |
|
Kamsarmax |
|
82,266 |
|
2006 |
|
September-14 |
58 |
Star Moira |
|
Kamsarmax |
|
82,257 |
|
2006 |
|
November-14 |
59 |
Star Nina |
|
Kamsarmax |
|
82,224 |
|
2006 |
|
January-15 |
60 |
Star Renee |
|
Kamsarmax |
|
82,221 |
|
2006 |
|
December-14 |
61 |
Star Nasia |
|
Kamsarmax |
|
82,220 |
|
2006 |
|
August-14 |
62 |
Star Laura |
|
Kamsarmax |
|
82,209 |
|
2006 |
|
December-14 |
63 |
Star Jennifer |
|
Kamsarmax |
|
82,209 |
|
2006 |
|
April-15 |
64 |
Star Mona (1) |
|
Kamsarmax |
|
82,188 |
|
2012 |
|
July-18 |
65 |
Star Helena |
|
Kamsarmax |
|
82,187 |
|
2006 |
|
December-14 |
66 |
Star Astrid (1) |
|
Kamsarmax |
|
82,158 |
|
2012 |
|
July-18 |
67 |
ABY Asia (1) |
|
Kamsarmax |
|
81,944 |
|
2017 |
|
August-18 |
68 |
Star Calypso (1) |
|
Kamsarmax |
|
81,918 |
|
2014 |
|
July-18 |
69 |
Star Charis |
|
Kamsarmax |
|
81,711 |
|
2013 |
|
March-17 |
70 |
Star Suzanna |
|
Kamsarmax |
|
81,711 |
|
2013 |
|
May-17 |
71 |
Mercurial Virgo |
|
Kamsarmax |
|
81,545 |
|
2013 |
|
July-14 |
72 |
Stardust (1) |
|
Kamsarmax |
|
81,501 |
|
2011 |
|
July-18 |
73 |
Songa Sky (1) |
|
Kamsarmax |
|
81,466 |
|
2010 |
|
July-18 |
74 |
Star Lydia |
|
Kamsarmax |
|
81,187 |
|
2013 |
|
August-18 |
75 |
Star Nicole |
|
Kamsarmax |
|
81,120 |
|
2013 |
|
August-18 |
76 |
ABY Virginia |
|
Kamsarmax |
|
81,061 |
|
2015 |
|
August-18 |
77 |
Star Genesis (1) |
|
Kamsarmax |
|
80,705 |
|
2010 |
|
July-18 |
78 |
Star Flame (1) |
|
Kamsarmax |
|
80,448 |
|
2011 |
|
July-18 |
79 |
Star Iris |
|
Panamax |
|
76,466 |
|
2004 |
|
September-14 |
80 |
Star Emily |
|
Panamax |
|
76,417 |
|
2004 |
|
September-14 |
81 |
Idee Fixe (1) |
|
Ultramax |
|
63,458 |
|
2015 |
|
March-15 |
82 |
Roberta (1) |
|
Ultramax |
|
63,426 |
|
2015 |
|
March-15 |
Existing On the Water Fleet (As of February 11, 2019) -
continued
|
Vessel Name |
|
Vessel
Type |
|
Capacity (dwt.) |
|
Year Built |
|
Date Delivered to Star Bulk |
83 |
Laura (1) |
|
Ultramax |
|
63,399 |
|
2015 |
|
April-15 |
84 |
Kaley (1) |
|
Ultramax |
|
63,283 |
|
2015 |
|
June-15 |
85 |
Kennadi |
|
Ultramax |
|
63,262 |
|
2016 |
|
January-16 |
86 |
Mackenzie |
|
Ultramax |
|
63,226 |
|
2016 |
|
March-16 |
87 |
Star Anna |
|
Ultramax |
|
63,038 |
|
2015 |
|
November-18 |
88 |
Star Wave (1) |
|
Ultramax |
|
61,491 |
|
2017 |
|
July-18 |
89 |
Star Challenger |
|
Ultramax |
|
61,462 |
|
2012 |
|
December-13 |
90 |
Star Fighter (1) |
|
Ultramax |
|
61,455 |
|
2013 |
|
December-13 |
91 |
Star Lutas |
|
Ultramax |
|
61,347 |
|
2016 |
|
January-16 |
92 |
Honey Badger |
|
Ultramax |
|
61,320 |
|
2015 |
|
February-15 |
93 |
Wolverine |
|
Ultramax |
|
61,292 |
|
2015 |
|
February-15 |
94 |
Star Antares |
|
Ultramax |
|
61,258 |
|
2015 |
|
October-15 |
95 |
Star Acquarius |
|
Ultramax |
|
60,916 |
|
2015 |
|
July-15 |
96 |
Star Pisces |
|
Ultramax |
|
60,916 |
|
2015 |
|
August-15 |
97 |
ABY Monica |
|
Ultramax |
|
60,935 |
|
2015 |
|
August-18 |
98 |
Songa Glory (1) |
|
Supramax |
|
58,680 |
|
2012 |
|
July-18 |
99 |
Diva |
|
Supramax |
|
56,582 |
|
2011 |
|
July-17 |
100 |
Strange Attractor |
|
Supramax |
|
55,742 |
|
2006 |
|
July-14 |
101 |
Star Bright |
|
Supramax |
|
55,783 |
|
2010 |
|
October-18 |
102 |
Star Omicron |
|
Supramax |
|
53,489 |
|
2005 |
|
April-08 |
103 |
Star Gamma |
|
Supramax |
|
53,098 |
|
2002 |
|
January-08 |
104 |
Star Zeta |
|
Supramax |
|
52,994 |
|
2003 |
|
January-08 |
105 |
Star Theta |
|
Supramax |
|
52,425 |
|
2003 |
|
December-07 |
106 |
Star Epsilon |
|
Supramax |
|
52,402 |
|
2001 |
|
December-07 |
107 |
Star Cosmo |
|
Supramax |
|
52,247 |
|
2005 |
|
July-08 |
108 |
Star Kappa |
|
Supramax |
|
52,055 |
|
2001 |
|
December-07 |
|
|
|
Total
dwt: |
|
12,054,230 |
|
|
|
|
Newbuilding Vessels
|
|
Vessel Name |
|
Vessel
Type |
|
Capacity (dwt.) |
|
Shipyard |
|
Expected delivery date |
1 |
|
HN 1388 (tbn Katie K)
(1) |
|
Newcastlemax |
|
208,000 |
|
SWS |
|
Mar-19 |
2 |
|
HN 1389 (tbn Debbie H)
(1) |
|
Newcastlemax |
|
208,000 |
|
SWS |
|
Apr-19 |
3 |
|
HN 1390 (tbn Ocean
Ayesha) (1) |
|
Newcastlemax |
|
208,000 |
|
SWS |
|
Jun-19 |
|
|
|
|
|
|
624,000 |
|
|
|
|
- Subject to a bareboat charter with purchase obligation at the
expiration of the bareboat term.
Amounts shown throughout the press release and variations in
period–on–period comparisons are derived from the actual numbers in
our books and records.
Fourth Quarter 2018 and 2017
Results
Voyage revenues for the fourth quarter of 2018
increased to $209.4 million from $107.7 million in the fourth
quarter of 2017. Adjusted time charter equivalent revenues
(“Adjusted TCE Revenues”) (please see the table at the end of this
release for the calculation of the Adjusted TCE Revenues) were
$136.2 million for the fourth quarter of 2018, compared to $90.0
million for the fourth quarter of 2017. Adjusted TCE Revenues were
primarily increased as a result of an increase in the average
number of vessels in our fleet to 106.4 in the fourth quarter of
2018, up from 70.6 in the fourth quarter of 2017. The TCE rates for
the fourth quarter of 2018 and 2017 were $14,140 and $13,860,
respectively.
Absent the adoption of the new revenue
recognition standard (ASC 606) in January 2018, which has no effect
on prior year figures, our TCE rate for the fourth quarter of 2018
would have been $14,018.
For the fourth quarter of 2018, operating income
was $33.9 million, which includes depreciation of $30.8 million and
impairment loss of $17.8 million, as discussed below. Operating
income of $37.2 million for the fourth quarter of 2017 included
depreciation of $21.1 million. Depreciation increased during the
fourth quarter of 2018 due to a higher average number of vessels in
our fleet as described above.
Net income for the fourth quarter of 2018 was
$12.3 million, or $0.13 earnings per share, basic and diluted,
based on 92,457,989 weighted average basic shares and 92,515,671
weighted average diluted shares, respectively. Net income for the
fourth quarter of 2017 was $23.9 million, or $0.37 income per
share, basic and diluted, based on 64,080,657 weighted average
basic shares and 64,259,874 weighted average diluted shares,
respectively.
Net income for the fourth quarter of 2018,
included the following significant non-cash items, other than
depreciation expense:
- Impairment loss of $17.8 million, or $0.19 per share, basic and
diluted, recognized (a) in anticipation of the sale of the Star
Delta and its delivery to its new owners in early January 2019,
which, as of December 31, 2018, was classified as held for sale and
(b) in connection with negotiated sales of two additional vessels
built before 2005;
- A loss on bad debt of $0.7 million or $0.01 per basic and
diluted share associated with the write-off of disputed charterer
balances; and
- Amortization of the fair value of below market acquired time
charters of $1.1 million, or $0.01 per share, basic and diluted,
associated with time charters attached to two vessels acquired
during the third quarter of 2018. These below market time charters
are amortized over the duration of each respective time charter
agreement as an increase to voyage revenues.
Net income for the fourth quarter of 2017,
included the following significant non-cash items, other than
depreciation expense:
- Loss on debt extinguishment of $0.9 million, or $0.01 per
share, basic and diluted, recognized in connection with the
refinancing in full of our 2019 Notes (as defined in our annual
report on Form 20-F for the fiscal year ended December 31, 2017
(the “2017 20-F”)) in December 2017;
- Net gain on sale of vessels of $3.0 million, or $0.05 per
share, basic and diluted, recognized in connection with the sale of
the Star Vanessa; and
- Unrealized gain on interest rate swaps of $0.5 million or $0.01
per share, basic and diluted.
Adjusted net income for the fourth quarter of
2018, was $30.3 million, or $0.33 earnings per share, basic and
diluted, compared to adjusted net income of $21.5 million, or $0.34
earnings per share, basic and diluted, for the fourth quarter of
2017. A reconciliation of Net income/(loss) to Adjusted Net
income/(loss) and Adjusted earnings/(loss) per share basic and
diluted is set forth in the financial tables contained in this
release.
Adjusted EBITDA for the fourth quarters of 2018
and 2017, was $82.4 million and $55.7 million, respectively. A
reconciliation of EBITDA and Adjusted EBITDA to net cash provided
by/(used in) operating activities is set forth in the financial
tables contained in this release.
For the fourth quarters of 2018 and 2017, vessel
operating expenses were $38.5 million and $25.4 million,
respectively. This increase was primarily due to the increase in
the average number of vessels to 106.4 from 70.6. Vessel operating
expenses for the fourth quarter of 2017 included pre-delivery and
pre-joining expenses of $0.4 million while during the fourth
quarter of 2018 no significant pre-delivery and pre-joining
expenses were incurred. Excluding these expenses, our average daily
operating expenses per vessel for the fourth quarter of 2018 and
2017, were $3,938 and $3,850, respectively.
During the fourth quarter of 2018, five of our
vessels underwent their periodic dry docking surveys, resulting in
$3.1 million of dry docking expense. During the fourth quarter of
2017, none of our vessels underwent their periodic dry docking
surveys, but we incurred expenses of $0.4 million in connection
with upcoming dry dockings.
General and administrative expenses for the
fourth quarters of 2018 and 2017 were $7.2 million and $5.9
million, respectively. The formation of our new subsidiary, Star
Logistics, and the increase of the number of our employees due to
the recent expansion of our fleet that occurred in the third
quarter of 2018 compared to the corresponding period in 2017,
resulted in higher payroll cost in the fourth quarter of 2018. In
addition, general and administrative expenses increased as a result
of the listing of our common shares on the Oslo Stock Exchange. Our
average daily net cash general and administrative expenses per
vessel together with management fees for the fourth quarter of 2018
were reduced to $969 from $1,094 during the fourth quarter of 2017
(please see the table at the end of this release for the
calculation of the Average daily Net Cash G&A expenses per
vessel).
Charter-in hire expense for the fourth quarters
of 2018 and 2017 was $25.0 million and $3.1 million, respectively.
The increase is due to increased charter in days of 1,493 in the
fourth quarter of 2018 compared to 197 in the fourth quarter of
2017. In both quarters, the charter in days are attributable to the
activities of our subsidiary Star Logistics, which was formed in
the fourth quarter of 2017.
Management fees for the fourth quarters of 2018
and 2017 were $4.0 million and $1.9 million, respectively. The
increase is attributable to the new management agreements entered
into in connection with the acquired fleets during the third
quarter of 2018.
Interest and finance costs net of interest and
other income/ (loss) for the fourth quarters of 2018 and 2017 were
$21.2 million and $12.6 million, respectively. The increase is
attributable to the increase in (i) LIBOR between the corresponding
periods and (ii) the weighted average balance of our outstanding
indebtedness of $1,447.6 million during the fourth quarter of 2018
compared to $1,043.2 million for the same period in 2017.
Years ended December 31, 2018 and 2017
Results
Voyage revenues for the year ended December 31,
2018 increased to $651.6 million from $332.0 million for the year
ended December 31, 2017. Adjusted TCE Revenues (please see the
table at the end of this release for the calculation of the
Adjusted TCE Revenues) were $435.2 million, compared to $262.7
million for the year ended December 31, 2017. This increase was
primarily attributable to the significant rise in charter hire
rates, which led to a TCE rate of $13,768 for the year ended
December 31, 2018, compared to a TCE rate of $10,393 for the year
ended December 31, 2017, representing a 32% increase. Adjusted TCE
Revenues also increased as a result of an increase in the average
number of vessels in our fleet to 87.7 in the year ended December
31, 2018, up from 69.6 in the year ended December 31, 2017
following the previously announced fleet acquisitions during the
third quarter of 2018.
Absent the adoption of the new revenue
recognition standard (ASC 606) in January 2018, which has no effect
to prior year figures, our TCE rate for the year ended December 31,
2018 would have been $13,772.
For the year ended December 31, 2018, operating
income was $131.9 million, which includes depreciation of $102.9
million and impairment loss of $17.8 million. Operating income of
$38.8 million for the year ended December 31, 2017 included
depreciation of $82.6 million. Depreciation increased during the
year ended December 31, 2018 due to a higher average number of
vessels in our fleet, as described above.
Net income for the year ended December 31, 2018
was $59.0 million, or $0.77 earnings per share, basic and $0.76
earnings per share, diluted, based on 77,061,227 weighted average
basic shares and 77,326,111 weighted average diluted shares,
respectively. Net loss for the year ended December 31, 2017 was
$9.8 million, or $0.16 loss per share, basic and diluted, based on
63,034,394 weighted average basic and diluted shares.
Net income for the year ended December 31, 2018
included the following significant non-cash items, other than
depreciation expense:
- Impairment loss of $17.8 million, or $0.23 per share, basic and
diluted, recognized (a) in anticipation of the sale of the Star
Delta and its delivery to its new owners in early January 2019,
which as of December 31, 2018, was classified as held for sale and
(b) in connection with negotiated sales of two additional vessels
built before 2005;
- Stock-based compensation expense of $8.1 million, or $0.10 per
share, basic and diluted, recognized in connection with common
shares granted to our directors and employees;
- Unrealized loss on forward freight agreements and bunker swaps
of $1.3 million, or $0.02 per share, basic and diluted;
- Loss on debt extinguishment of $1.8 million, or $0.02 per
share, basic and diluted, recognized in connection with the
refinance of certain of our debt facilities;
- A loss on bad debt of $0.7 million or $0.01 per basic and
diluted share associated with the write-off of disputed charterer
balances;
- Unrealized gain on derivative financial instruments of $0.7
million or $0.01 per share, basic and diluted; and
- Amortization of the fair value of below market acquired time
charters of $1.8 million, or $0.02 per share, basic and diluted,
associated with time charters attached to two acquired vessels.
These below market time charters are amortized over the duration of
each respective charter as an increase to voyage revenues.
Net loss for the year ended December 31, 2017,
included the following significant non-cash items, other than
depreciation expense:
- Stock based compensation expense of $9.3 million, or $0.15 per
share, basic and diluted, recognized in connection with common
shares granted to our directors and employees;
- An aggregate net gain on sale of vessels of $2.6 million, or
$0.04 per share, basic and diluted, in connection with the sale of
(i) the Star Eleonora in March 2017 and (ii) the Star Vanessa in
November 2017;
- Unrealized gain on interest rate swaps of $2.3 million or $0.04
per share, basic and diluted; and
- Loss on debt extinguishment of $1.3 million or $0.02 per share,
basic and diluted, in connection with the cancellation of a
previous loan commitment and the refinancing in full of our 2019
Notes (as defined in the 2017 20-F) in December 2017.
Adjusted net income for the year ended December
31, 2018 was $86.1 million, or $1.12 earnings per share, basic and
$1.11 earnings per share, diluted, compared to adjusted net loss of
$4.3 million, or $0.07 loss per share, basic and diluted, for the
year ended December 31, 2017. A reconciliation of Net income/(loss)
to Adjusted Net income/(loss) and Adjusted earnings/(loss) per
share basic and diluted is set forth in the financial tables
contained in this release.
Adjusted EBITDA for the years ended December 31,
2018 and 2017 was $260.9 million and $128.0 million, respectively.
A reconciliation of EBITDA and Adjusted EBITDA to net cash provided
by/(used in) operating activities is set forth in the financial
tables contained in this release.
For the years ended December 31, 2018 and 2017,
vessel operating expenses were $128.9 million and $101.4 million,
respectively. This increase was primarily due to the increase in
the average number of vessels to 87.7 from 69.6. Vessel operating
expenses for the years ended December 31, 2018 and 2017 include
pre-delivery and pre-joining expenses of $1.1 million and $2.3
million, respectively, incurred in connection with the delivery of
the new vessels in our fleet during each period. Excluding these
expenses, our average daily operating expenses per vessel for the
years ended December 31, 2018 and 2017, were $3,994 and $3,906,
respectively.
Dry docking expenses for the years ended
December 31, 2018 and 2017 were $9.0 million and $4.3 million,
respectively. During the year ended December 31, 2018, eight of our
vessels underwent and seven of them completed their periodic dry
docking surveys during the same period. During the year ended
December 31, 2017, four vessels underwent and completed their
periodic dry docking surveys.
General and administrative expenses for the
years ended December 31, 2018 and 2017 were $34.0 million and $31.0
million, respectively. The formation of our new subsidiary, Star
Logistics, the increase of the number of our employees due to the
recent expansion of our fleet and a higher USD/EUR exchange rate
during the year ended December 31, 2018 resulted in higher payroll
cost compared to the corresponding period in 2017. In addition,
general and administrative expenses increased as a result of the
listing of our common shares on the Oslo Stock Exchange. Our
average daily net cash general and administrative expenses per
vessel together with management fees for the year ended December
31, 2018 were reduced to $1,004 from $1,094, during the
corresponding period in 2017 (please see the table at the end of
this release for the calculation of the Average daily Net Cash
G&A expenses per vessel).
Charter-in hire expense for the years ended
December 31, 2018 and 2017 was $92.9 million and $5.3 million,
respectively. The increase in charter-in hire expense was due to an
increase in charter-in days to 5,089 in the year ended December 31,
2018 (attributable to the activities of our new subsidiary Star
Logistics, which was created in the fourth quarter of 2017) from
428 in the year ended December 31, 2017 (attributable to the
charter-in of the vessel Astakos and Star Logistics).
Management fees for the years ended December 31,
2018 and 2017 were $11.3 million and $7.5 million, respectively.
The increase is attributable to the new management agreements
entered into in connection with the acquired fleets during the
third quarter of 2018.
Interest and finance costs net of interest and
other income/ (loss) for the years ended December 31, 2018 and 2017
were $71.8 million and $47.5 million, respectively. The increase is
mainly attributable to the increase in (i) the weighted average
balance of our outstanding indebtedness of $1,234.6 million during
the year ended December 31, 2018 compared to $1,027.1 million for
the same period in 2017 and (ii) LIBOR between the corresponding
periods.
Liquidity and Capital
ResourcesCash Flows
Net cash provided by operating
activities for the years ended December 31, 2018 and 2017 was
$169.0 million and $82.8 million, respectively.
The positive change was due to the significant
recovery of the dry bulk market during the year ended December 31,
2018, which resulted in a significantly higher TCE rate of $13,768
compared to $10,393 for the year ended December 31, 2017. The
increase in TCE rates as well as the increase in the average number
of vessels in our fleet is reflected in the increase of Adjusted
EBITDA to $260.9 million for the year ended December 31, 2018 from
$128.0 million for the corresponding period in 2017. This positive
effect was partially offset by (i) a net working capital outflow of
$20.9 million during the year ended December 31, 2018 compared to a
net working capital inflow of $1.7 million for the year ended
December 31, 2017 and (ii) by higher net interest expense for the
year ended December 31, 2018 compared to the corresponding period
in 2017.
Net cash used in investing activities
for the years ended December 31, 2018 and 2017 was $327.2 million
and $127.1 million, respectively.
For the year ended December 31, 2018, net cash
used in investing activities mainly consisted of $330.5 million
paid for advances and other capitalized expenses for our
newbuilding and newly acquired vessels delivered during the period
as well as for the acquisition and installation of scrubber
equipment for certain of our vessels, offset partially by hull and
machinery insurance proceeds of $3.3 million.
For the year ended December 31, 2017, net cash
used in investing activities consisted of:
- $143.7 million paid for advances and other capitalized expenses
for our newbuilding and newly delivered vessels;offset partially
by:
- $15.2 million of proceeds from the sale of the Star Eleonora
and the Star Vanessa; and
- $1.4 million of hull and machinery insurance proceeds.
Net cash provided by financing
activities for the years ended December 31, 2018 and 2017 was $98.6
million and $122.0 million,
respectively.
For the year ended December 31, 2018, net cash
provided by financing activities mainly consisted of:
- $988.0 million of proceeds from financing including financing
from leases;offset partially by:
- $875.0 lease and debt obligations paid in aggregate in
connection with: (i) the regular amortization of outstanding vessel
financings and capital lease installments, (ii) early repayment due
to the refinancing of certain of our facilities; (iii) payments
under our cash sweep mechanism and (iv) full repayment of deferred
debt amounts;
- $3.1 million used to repurchase 341,363 of our common shares in
open market transactions; and
- $12.0 million of financing fees paid in connection with the new
financing agreements.
For the year ended December 31, 2017, net cash
provided by financing activities consisted of:
- $79.9 million increase in capital lease obligations, relating
to two delivered newbuilding vessels under bareboat charters;
- $30.8 million of proceeds drawn under the newly entered loan
facilities;
- $50.0 million proceeds from the issuance of our 8.30% senior
unsecured notes due 2022, used to redeem in full our 2019 Notes in
December 2017; and
- $50.4 million of proceeds, net of aggregate fees and expenses
of $1.0 million, from a private placement of our common shares,
which was completed in February 2017;offset partially by:
- $36.3 million paid in aggregate in connection with: (i) the
regular amortization of outstanding vessel financings and capital
lease installments, (ii) early repayment due to the refinancing of
a loan facility and due to the sale of a vessel; (iii) payments to
our lenders in accordance with the terms of our restructuring
agreements;
- $50.0 million used to redeem in full the 2019 Notes; and
- $2.9 million of financing fees, paid in connection with (i) the
restructuring of our indebtedness, (ii) a new facility entered
during the corresponding period; (iii) the refinancing of the Heron
Vessels Facility (as defined in our 2017 20-F) and (iv) the
issuance of our 8.30% senior unsecured notes due 2022.
Summary of Selected Data
|
|
|
|
|
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Average
number of vessels (1) |
|
106.4 |
|
|
|
70.6 |
|
|
Number of
vessels (2) |
|
107 |
|
|
|
71 |
|
|
Average
age of operational fleet (in years) (3) |
|
8.0 |
|
|
|
8.2 |
|
|
Ownership
days (4) |
|
9,788 |
|
|
|
6,495 |
|
|
Available
days (5) |
|
9,633 |
|
|
|
6,495 |
|
|
Charter-in days (6) |
|
1,493 |
|
|
|
197 |
|
|
Fleet
utilization (7) |
|
98.6 |
% |
|
|
100.0 |
% |
|
Daily
Time Charter Equivalent Rate (8) |
$14,140 |
|
|
$13,860 |
|
|
Average
daily OPEX per vessel (9) |
$3,938 |
|
|
$3,911 |
|
|
Average
daily OPEX per vessel (excl. pre-delivery expenses) |
$3,938 |
|
|
$3,850 |
|
|
Average
daily Net Cash G&A expenses per vessel (excluding one-time
expenses) (10) |
$969 |
|
|
$1,094 |
|
|
|
|
|
|
|
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
Average
number of vessels (1) |
|
87.7 |
|
|
|
69.6 |
|
|
Number of
vessels (2) |
|
107 |
|
|
|
71 |
|
|
Average
age of operational fleet (in years) (3) |
|
8.0 |
|
|
|
8.2 |
|
|
Ownership
days (4) |
|
32,001 |
|
|
|
25,387 |
|
|
Available
days (5) |
|
31,614 |
|
|
|
25,272 |
|
|
Charter-in days (6) |
|
5,089 |
|
|
|
428 |
|
|
Fleet
utilization (7) |
|
99.0 |
% |
|
|
99.6 |
% |
|
Daily
Time Charter Equivalent Rate (8) |
$13,768 |
|
|
$10,393 |
|
|
Average
daily OPEX per vessel (9) |
$4,027 |
|
|
$3,995 |
|
|
Average
daily OPEX per vessel (excl. pre-delivery expenses) |
$3,994 |
|
|
$3,906 |
|
|
Average
daily Net Cash G&A expenses per vessel (excluding one-time
expenses) (10) |
$1,004 |
|
|
$1,094 |
|
|
|
|
|
|
|
(1) Average number of vessels is the
number of vessels that constituted our owned fleet for the relevant
period, as measured by the sum of the number of days each operating
vessel was a part of our owned 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 the end of each period.(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 and scrubber installation. (6) Charter-in
days are the total days that we charter-in third-party
vessels.(7) Fleet utilization is calculated by dividing (x)
Available days plus Charter-in days by (y) Ownership days plus
charter-in days for the relevant period. (8) Represents
the weighted average daily TCE rates of our operating fleet
(including owned fleet and fleet under charter-in arrangements).
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,
charter-in hire expense, amortization of fair value of above/below
market acquired time charter agreements and provision for onerous
contracts, if any) by Available 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, bareboat
charters and pool arrangements) under which its vessels may be
employed between the periods. Our method of computing TCE
may not necessarily be comparable to TCE of other companies
due to differences in methods of calculation. The above reported
TCE rates for the fourth quarter of 2017 and the year ended
December 31, 2017 were calculated excluding Star Logistics. We have
excluded the revenues and expenses of Star Logistics because it was
formed, in October 2017, and its revenues and expenses had not yet
normalized in those periods, which obscure material trends of our
TCE rates. As a result, we believe it is more informative to our
investors to present the TCE rates excluding the revenues and
expenses of Star Logistics for those periods. For the detailed
calculation please see the table at the end of this release with
the reconciliation of Voyage Revenues to TCE. We include TCE rate,
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 operating vessels
and assists investors and our management in evaluating our
financial performance. (9) Average daily OPEX per vessel is
calculated by dividing vessel operating expenses by Ownership
days.(10) Please see the table at the end of this release for the
reconciliation to General and administrative expenses, the most
directly comparable GAAP measure. We believe that Average daily Net
Cash G&A expenses per vessel is a useful measure for our
management and investors for period to period comparison with
respect to our financial performance since such measure eliminates
the effects of non-cash items which may vary from period to period,
are not part of our daily business and derive from reasons
unrelated to overall operating performance.
Unaudited Consolidated Statements of
Operations
|
|
|
|
|
|
|
|
|
|
(Expressed in thousands
of U.S. dollars except for share and per share data) |
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
Voyage revenues |
|
$ |
209,433 |
|
|
$ |
107,707 |
|
|
$ |
651,561 |
|
|
$ |
331,976 |
|
|
Total
revenues |
|
|
209,433 |
|
|
|
107,707 |
|
|
|
651,561 |
|
|
|
331,976 |
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
Voyage
expenses |
|
|
(46,628 |
) |
|
|
(15,252 |
) |
|
|
(121,596 |
) |
|
|
(64,682 |
) |
|
Charter-in hire
expense |
|
|
(25,005 |
) |
|
|
(3,128 |
) |
|
|
(92,896 |
) |
|
|
(5,325 |
) |
|
Vessel operating
expenses |
|
|
(38,544 |
) |
|
|
(25,399 |
) |
|
|
(128,872 |
) |
|
|
(101,428 |
) |
|
Dry docking
expenses |
|
|
(3,125 |
) |
|
|
(362 |
) |
|
|
(8,970 |
) |
|
|
(4,262 |
) |
|
Depreciation |
|
|
(30,814 |
) |
|
|
(21,129 |
) |
|
|
(102,852 |
) |
|
|
(82,623 |
) |
|
Management fees |
|
|
(4,042 |
) |
|
|
(1,925 |
) |
|
|
(11,321 |
) |
|
|
(7,543 |
) |
|
Loss on bad debt |
|
|
(722 |
) |
|
|
- |
|
|
|
(722 |
) |
|
|
- |
|
|
General and
administrative expenses |
|
|
(7,223 |
) |
|
|
(5,860 |
) |
|
|
(33,972 |
) |
|
|
(30,955 |
) |
|
Gain/(Loss) on forward
freight agreements and bunker swaps |
|
|
(1,389 |
) |
|
|
(300 |
) |
|
|
(447 |
) |
|
|
(841 |
) |
|
Impairment
loss |
|
|
(17,784 |
) |
|
|
- |
|
|
|
(17,784 |
) |
|
|
- |
|
|
Other operational
loss |
|
|
(230 |
) |
|
|
(266 |
) |
|
|
(191 |
) |
|
|
(989 |
) |
|
Other operational
gain |
|
|
- |
|
|
|
138 |
|
|
|
- |
|
|
|
2,918 |
|
|
Gain/(Loss) on sale of
vessels |
|
|
- |
|
|
|
2,996 |
|
|
|
- |
|
|
|
2,598 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income/(loss) |
|
|
33,927 |
|
|
|
37,220 |
|
|
|
131,938 |
|
|
|
38,844 |
|
|
|
|
|
|
|
|
|
|
|
|
Interest and finance
costs |
|
|
(22,024 |
) |
|
|
(13,585 |
) |
|
|
(73,715 |
) |
|
|
(50,458 |
) |
|
Interest and other
income/(loss) |
|
|
836 |
|
|
|
980 |
|
|
|
1,866 |
|
|
|
2,997 |
|
|
Gain/(Loss) on
derivative financial instruments |
|
|
- |
|
|
|
179 |
|
|
|
707 |
|
|
|
246 |
|
|
Loss on debt
extinguishment |
|
|
(313 |
) |
|
|
(871 |
) |
|
|
(1,783 |
) |
|
|
(1,257 |
) |
|
Total other
expenses, net |
|
|
(21,501 |
) |
|
|
(13,297 |
) |
|
|
(72,925 |
) |
|
|
(48,472 |
) |
|
|
|
|
|
|
|
|
|
|
|
Income/(Loss)
before equity in investee |
|
|
12,426 |
|
|
|
23,923 |
|
|
|
59,013 |
|
|
|
(9,628 |
) |
|
|
|
|
|
|
|
|
|
|
|
Equity in income/(loss)
of investee |
|
|
(50 |
) |
|
|
29 |
|
|
|
45 |
|
|
|
93 |
|
|
|
|
|
|
|
|
|
|
|
|
Income/(Loss)
before taxes |
|
$ |
12,376 |
|
|
$ |
23,952 |
|
|
$ |
59,058 |
|
|
$ |
(9,535 |
) |
|
|
|
|
|
|
|
|
|
|
|
US Source Income
taxes |
|
|
(61 |
) |
|
|
(68 |
) |
|
|
(61 |
) |
|
|
(236 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net
income/(loss) |
|
$ |
12,315 |
|
|
$ |
23,884 |
|
|
$ |
58,997 |
|
|
$ |
(9,771 |
) |
|
|
|
|
|
|
|
|
|
|
|
Earnings/(loss) per
share, basic |
|
$ |
0.13 |
|
|
$ |
0.37 |
|
|
$ |
0.77 |
|
|
$ |
(0.16 |
) |
|
Earnings/(loss) per
share, diluted |
|
$ |
0.13 |
|
|
$ |
0.37 |
|
|
$ |
0.76 |
|
|
$ |
(0.16 |
) |
|
Weighted average number
of shares outstanding, basic |
|
|
92,457,989 |
|
|
|
64,080,657 |
|
|
|
77,061,227 |
|
|
|
63,034,394 |
|
|
Weighted average number
of shares outstanding, diluted |
|
|
92,515,671 |
|
|
|
64,259,874 |
|
|
|
77,326,111 |
|
|
|
63,034,394 |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Consolidated Condensed Balance
Sheets
|
|
(Expressed
in thousands of U.S. dollars) |
|
|
|
ASSETS |
|
December 31, 2018 |
|
December 31, 2017 |
|
Cash and cash
equivalents |
|
$ |
204,921 |
|
$ |
257,911 |
|
Vessel held for
sale |
|
|
5,949 |
|
|
- |
|
Other current
assets |
|
|
87,967 |
|
|
54,715 |
|
TOTAL CURRENT
ASSETS |
|
|
298,837 |
|
|
312,626 |
|
|
|
|
|
|
|
Advances for vessels
under construction and acquisition of vessels |
|
|
60,944 |
|
|
48,574 |
|
Vessels and other fixed
assets, net |
|
|
2,657,233 |
|
|
1,775,081 |
|
Other non-current
assets |
|
|
6,249 |
|
|
9,483 |
|
TOTAL
ASSETS |
|
$ |
3,023,263 |
|
$ |
2,145,764 |
|
|
|
|
|
|
|
Current portion of
long-term debt and finance lease commitments |
|
$ |
176,241 |
|
$ |
189,306 |
|
Other current
liabilities |
|
|
55,873 |
|
|
29,968 |
|
TOTAL CURRENT
LIABILITIES |
|
|
232,114 |
|
|
219,274 |
|
|
|
|
|
|
|
Long-term debt and
finance lease commitments non-current(net of unamortized deferred
finance fees of $13,447 and $7,154, respectively) |
|
|
1,217,872 |
|
|
789,878 |
|
Senior Notes (net of
unamortized deferred finance fees of $1,590 and $2,000,
respectively) |
|
|
48,410 |
|
|
48,000 |
|
Other non-current
liabilities |
|
|
4,222 |
|
|
560 |
|
TOTAL
LIABILITIES |
|
$ |
1,502,618 |
|
$ |
1,057,712 |
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY |
|
|
1,520,645 |
|
|
1,088,052 |
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
3,023,263 |
|
$ |
2,145,764 |
|
|
|
|
|
|
|
Unaudited Cash Flow Data
(Expressed in thousands of U.S. dollars) |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
|
|
|
|
|
|
|
|
|
|
Net cash
provided by / (used in) operating activities |
|
$ |
169,009 |
|
|
$ |
82,804 |
|
|
|
|
|
|
|
|
|
|
|
Net cash
provided by / (used in) investing activities |
|
|
(327,196 |
) |
|
|
(127,101 |
) |
|
|
|
|
|
|
|
|
|
|
Net cash
provided by / (used in) financing activities |
|
|
98,564 |
|
|
|
122,035 |
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA and Adjusted EBITDA Reconciliation
We include EBITDA herein since it is a basis
upon which we assess our liquidity position. It is also used by our
lenders as a measure of our compliance with certain loan covenants
and we believe that it presents useful information to investors
regarding our ability to service and/or incur indebtedness.
EBITDA does not represent and should not be
considered as an alternative to cash flow from operating activities
or net income, 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 due to
differences in methods of calculation.
To derive Adjusted EBITDA from EBITDA, we
excluded non-cash gains/losses such as those related to sale of
vessels, stock-based compensation expense the write-off of the
unamortized fair value of above/below market acquired time
charters, impairment losses, the write-off of claims receivable and
loss from bad debt, change in fair value of forward freight
agreements and bunker swaps, provision for onerous contracts, and
the equity in income/(loss) of investee, if any, which may vary
from period to period and for different companies and because these
items do not reflect operational cash inflows and outflows of our
fleet.
The following table reconciles net cash provided
by operating activities to EBITDA and Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
(Expressed in thousands
of U.S. dollars) |
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
Net cash provided
by/(used in) operating activities |
|
$ |
59,836 |
|
|
$ |
44,329 |
|
|
$ |
169,009 |
|
|
$ |
82,804 |
|
|
Net decrease /
(increase) in current assets |
|
|
(386 |
) |
|
|
2,147 |
|
|
|
39,277 |
|
|
|
8,628 |
|
|
Net increase /
(decrease) in operating liabilities, excluding current
portion of long term debt |
|
|
2,780 |
|
|
|
(3,314 |
) |
|
|
(20,469 |
) |
|
|
(10,452 |
) |
|
Impairment loss |
|
|
(17,784 |
) |
|
|
- |
|
|
|
(17,784 |
) |
|
|
- |
|
|
Loss on debt
extinguishment |
|
|
(313 |
) |
|
|
(871 |
) |
|
|
(1,783 |
) |
|
|
(1,257 |
) |
|
Stock – based
compensation |
|
|
(337 |
) |
|
|
(414 |
) |
|
|
(8,072 |
) |
|
|
(9,267 |
) |
|
Amortization of
deferred finance charges |
|
|
(1,097 |
) |
|
|
(685 |
) |
|
|
(3,253 |
) |
|
|
(2,660 |
) |
|
Unrealized and accrued
gain/(loss) on derivative financial instruments |
|
|
- |
|
|
|
582 |
|
|
|
1,230 |
|
|
|
1,821 |
|
|
Unrealized gain /
(loss) on forward freight agreements and bunker swaps |
|
|
(384 |
) |
|
|
77 |
|
|
|
(1,339 |
) |
|
|
36 |
|
|
Total other expenses,
net |
|
|
21,501 |
|
|
|
13,297 |
|
|
|
72,925 |
|
|
|
48,472 |
|
|
Fair value hedge
adjustment |
|
|
286 |
|
|
|
- |
|
|
|
1,609 |
|
|
|
- |
|
|
Other non-current
assets |
|
|
- |
|
|
|
- |
|
|
|
1,972 |
|
|
|
- |
|
|
Gain on hull and
machinery claims |
|
|
184 |
|
|
|
137 |
|
|
|
309 |
|
|
|
456 |
|
|
Loss on bad debt |
|
|
(722 |
) |
|
|
- |
|
|
|
(722 |
) |
|
|
- |
|
|
Income tax |
|
|
61 |
|
|
|
68 |
|
|
|
61 |
|
|
|
236 |
|
|
Gain/(Loss) on sale of
vessel |
|
|
- |
|
|
|
2,996 |
|
|
|
- |
|
|
|
2,598 |
|
|
Equity in income/(loss)
of investee |
|
|
(50 |
) |
|
|
29 |
|
|
|
45 |
|
|
|
93 |
|
|
EBITDA |
|
$ |
63,575 |
|
|
$ |
58,378 |
|
|
$ |
233,015 |
|
|
$ |
121,508 |
|
|
|
|
|
|
|
|
|
|
|
|
Equity in (income)/loss
of investee |
|
|
50 |
|
|
|
(29 |
) |
|
|
(45 |
) |
|
|
(93 |
) |
|
Unrealized (gain)/loss
on forward freight agreements and bunker swaps |
|
|
384 |
|
|
|
(77 |
) |
|
|
1,339 |
|
|
|
(36 |
) |
|
Gain on sale of
vessel |
|
|
- |
|
|
|
(2,996 |
) |
|
|
- |
|
|
|
(2,598 |
) |
|
Reversal of provision
for onerous contracts |
|
|
(473 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Stock-based
compensation |
|
|
337 |
|
|
|
414 |
|
|
|
8,072 |
|
|
|
9,267 |
|
|
Loss on bad debt |
|
|
722 |
|
|
|
- |
|
|
|
722 |
|
|
|
- |
|
|
Impairment loss |
|
|
17,784 |
|
|
|
- |
|
|
|
17,784 |
|
|
|
- |
|
|
Adjusted
EBITDA |
|
$ |
82,379 |
|
|
$ |
55,690 |
|
|
$ |
260,887 |
|
|
$ |
128,048 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income/(Loss) and Adjusted Net
income/(Loss) Reconciliation and calculation of Adjusted
Earnings/(Loss) Per Share
To derive Adjusted Net Income and Adjusted
Earnings/(Loss) Per Share from Net Income, we excluded non-cash
items, as provided in the table below. We believe that Adjusted Net
Income and Adjusted Earnings/(Loss) Per Share assist our management
and investors by increasing the comparability of our performance
from period to period since each such measure eliminates the
effects of such non-cash items as gain/(loss) on sale of assets,
gain/(loss) on derivatives, impairment losses and other items which
may vary from year to year, are not part of our daily business and
derive from reasons unrelated to overall operating performance. In
addition we believe that the presentation of the respective measure
provides investors with supplemental data relating to our results
of operations; and therefore with a more complete understanding of
factors affecting our business than GAAP measures alone. Our method
of computing Adjusted Net Income and Adjusted Earnings/ (Loss) Per
Share may not necessarily be comparable to other similarly titled
captions of other companies due to differences in methods of
calculation.
The following table reconciles Net income /
(loss) to Adjusted Net income / (loss):
|
|
|
|
|
|
|
|
|
|
(Expressed in thousands
of U.S. dollars except for share and per share data) |
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
Net income /
(loss) |
|
$ |
12,315 |
|
|
$ |
23,884 |
|
|
$ |
58,997 |
|
|
$ |
(9,771 |
) |
|
Amortization of fair value of below market acquired time charter
agreements |
|
|
(1,116 |
) |
|
|
- |
|
|
|
(1,820 |
) |
|
|
- |
|
|
Loss on
bad debt |
|
|
722 |
|
|
|
- |
|
|
|
722 |
|
|
|
- |
|
|
Stock –
based compensation |
|
|
337 |
|
|
|
414 |
|
|
|
8,072 |
|
|
|
9,267 |
|
|
Unrealized (gain) /
loss on forward freight agreements and bunker swaps |
|
|
384 |
|
|
|
(77 |
) |
|
|
1,339 |
|
|
|
(36 |
) |
|
Reversal of provision
for onerous contracts |
|
|
(473 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Unrealized (gain) /
loss on derivative financial instruments |
|
|
- |
|
|
|
(532 |
) |
|
|
(734 |
) |
|
|
(2,275 |
) |
|
(Gain) /
loss on sale of vessel |
|
|
- |
|
|
|
(2,996 |
) |
|
|
- |
|
|
|
(2,598 |
) |
|
Impairment loss |
|
|
17,784 |
|
|
|
- |
|
|
|
17,784 |
|
|
|
- |
|
|
Amortization of deferred gain from sale and leaseback |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(52 |
) |
|
Loss on debt
extinguishment |
|
|
313 |
|
|
|
871 |
|
|
|
1,783 |
|
|
|
1,257 |
|
|
Equity
in income/(loss) of investee |
|
|
50 |
|
|
|
(29 |
) |
|
|
(45 |
) |
|
|
(93 |
) |
|
Adjusted Net
income / (loss) |
|
$ |
30,316 |
|
|
$ |
21,535 |
|
|
$ |
86,098 |
|
|
$ |
(4,301 |
) |
|
Weighted
average number of shares outstanding, basic |
|
|
92,457,989 |
|
|
|
64,080,657 |
|
|
|
77,061,227 |
|
|
|
63,034,394 |
|
|
Weighted
average number of shares outstanding, diluted |
|
|
92,515,671 |
|
|
|
64,259,874 |
|
|
|
77,326,111 |
|
|
|
63,034,394 |
|
|
Adjusted Basic
Earnings / (Loss) Per Share |
|
$ |
0.33 |
|
|
$ |
0.34 |
|
|
$ |
1.12 |
|
|
$ |
(0.07 |
) |
|
Adjusted
Diluted Earnings / (Loss) Per Share |
|
$ |
0.33 |
|
|
$ |
0.34 |
|
|
$ |
1.11 |
|
|
$ |
(0.07 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voyage Revenues to Daily Time Charter Equivalent (“TCE”)
Reconciliation
(In
thousands of U.S. Dollars, except for TCE rates) |
|
|
|
|
|
|
|
|
|
|
|
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
|
Voyage revenues |
|
$ |
209,433 |
|
|
$ |
103,623 |
|
a) |
$ |
651,561 |
|
|
$ |
327,892 |
|
d) |
|
Less: |
|
|
|
|
|
|
|
|
|
|
Voyage expenses |
|
|
(46,628 |
) |
|
|
(13,604 |
) |
b) |
|
(121,596 |
) |
|
|
(63,034 |
) |
e) |
|
Charter-in hire
expenses |
|
|
(25,005 |
) |
|
|
- |
|
c) |
|
(92,896 |
) |
|
|
(2,197 |
) |
f) |
|
Time Charter
equivalent revenues |
|
$ |
137,800 |
|
|
$ |
90,019 |
|
|
$ |
437,069 |
|
|
$ |
262,661 |
|
|
|
Reversal of provision
for onerous contracts |
|
|
(473 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
Amortization of fair
value of below/above market acquired time charter agreements |
|
|
(1,116 |
) |
|
|
- |
|
|
|
(1,820 |
) |
|
|
- |
|
|
|
Adjusted Time
Charter equivalent revenues |
|
$ |
136,211 |
|
|
$ |
90,019 |
|
|
$ |
435,249 |
|
|
$ |
262,661 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available days for
fleet |
|
|
9,633 |
|
|
|
6,495 |
|
|
|
31,614 |
|
|
|
25,272 |
|
|
|
Daily Time
Charter Equivalent Rate ("TCE") |
|
$ |
14,140 |
|
|
$ |
13,860 |
|
|
$ |
13,768 |
|
|
$ |
10,393 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Voyage revenues used to calculate TCE rate for the fourth
quarter of 2017 consist of (1) reported voyage revenues of $107.7
million minus (2) voyage revenues of $4.1 million attributable to
Star Logistics.
- Voyage expenses used to calculate TCE rate for the fourth
quarter of 2017 consist of (1) reported voyage expenses of $15.3
million minus (2) voyage expenses of $1.7 million attributable to
Star Logistics.
- Reported Charter-in hire expenses for the fourth quarter of
2017 of $3.1 million attributable to Star Logistics, was excluded
from the calculation of TCE rate.
- Voyage revenues used to calculate TCE rate for the year ended
December 31, 2017 consist of (1) reported voyage revenues of $332.0
million minus (2) voyage revenues of $4.1 million
attributable to Star Logistics.
- Voyage expenses used to calculate TCE rate for the year ended
December 31, 2017 consist of (1) reported voyage expenses of $64.7
million minus (2) voyage expenses of $1.7 million attributable to
Star Logistics.
- Charter-in hire expenses used to calculate TCE rate for
the year ended December 31, 2017 consist of (1) reported charter-in
hire expenses of $5.3 million minus (2) charter-in hire expenses of
$3.1 million attributable to Star Logistics.
Average daily Net Cash G&A expenses per vessel
Reconciliation
(In
thousands of U.S. Dollars, except for daily rates) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fourth quarter 2018 |
|
Fourth quarter 2017 |
|
Twelve months ended December 31,
2018 |
|
Twelve months ended December 31,
2017 |
|
General and
administrative expenses |
|
$ |
7,223 |
|
|
$ |
5,860 |
|
|
$ |
33,972 |
|
|
$ |
30,955 |
|
|
Plus: |
|
|
|
|
|
|
|
|
|
Management fees |
|
|
4,042 |
|
|
|
1,925 |
|
|
|
11,321 |
|
|
|
7,543 |
|
|
Less: |
|
|
|
|
|
|
|
|
|
Stock – based
compensation |
|
|
(337 |
) |
|
|
(414 |
) |
|
|
(8,072 |
) |
|
|
(9,267 |
) |
|
One-time expenses |
|
|
- |
|
|
|
(52 |
) |
|
|
- |
|
|
|
(989 |
) |
|
Net Cash
G&As expenses (excluding one-time expenses) |
|
$ |
10,928 |
|
|
$ |
7,319 |
|
|
$ |
37,221 |
|
|
$ |
28,242 |
|
|
|
|
|
|
|
|
|
|
|
|
Ownership days |
|
|
9,788 |
|
|
|
6,495 |
|
|
|
32,001 |
|
|
|
25,387 |
|
|
Charter-in
days |
|
|
1,493 |
|
|
|
197 |
|
|
|
5,089 |
|
|
|
428 |
|
|
Average daily
Net Cash G&A expenses per vessel (excluding one-time
expenses) |
|
$ |
969 |
|
|
$ |
1,094 |
|
|
$ |
1,004 |
|
|
$ |
1,094 |
|
|
|
|
|
|
|
|
|
|
|
|
Conference Call details:
Our management team will host a conference call
to discuss our financial results on Tuesday, February 12, 2019 at
11:00 a.m., Eastern Time (ET).
Participants should dial into the call 10
minutes before the scheduled time using the following numbers:
1(877) 553-9962 (from the US), 0(808) 238-0069 (from the UK) or +
(44) (0) 2071 928 592 (Standard International Dial In). Please
quote "Star Bulk."
A replay of the conference call will be
available until Wednesday, February 19, 2019. The United States
replay number is 1(866) 331-1332; from the UK 0(808) 238-0667; the
standard international replay number is (+44) (0) 3333 009 785 and
the access code required for the replay is: 3128607#.
Slides and audio webcast:
There will also be a simultaneous live webcast
over the Internet through the Star Bulk website (www.starbulk.com).
Participants to the live webcast should register on the website
approximately 10 minutes prior to the start of the webcast.
About Star Bulk
Star Bulk is a global shipping company providing
worldwide seaborne transportation solutions in the dry bulk sector.
Star Bulk’s vessels transport major bulks, which include iron ore,
coal and grain, and minor bulks, which include bauxite, fertilizers
and steel products. Star Bulk was incorporated in the Marshall
Islands on December 13, 2006 and maintains executive offices in
Athens, Oslo, New York, Cyprus and Geneva. Its common stock trades
on the Nasdaq Global Select Market and on the Oslo Stock Exchange
under the symbol “SBLK”. On a fully delivered basis, Star Bulk will
have a fleet of 111 vessels, with an aggregate capacity of 12.67
million dwt, consisting of 17 Newcastlemax, 20 Capesize, 2 Mini
Capesize, 7 Post Panamax, 35 Kamsarmax, 2 Panamax, 17 Ultramax and
11 Supramax vessels with carrying capacities between 52,055 dwt and
209,537 dwt. Where we refer to information on a “fully delivered
basis,” we are referring to such information after giving
effect to the delivery of three newbuilding vessels The Company
also holds call options and has sold respective put options on four
Capesize vessels, with exercise dates in early April 2019.
Forward-Looking Statements
Matters discussed in this press release may
constitute forward looking statements. 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.
Forward-looking statements 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 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 this safe harbor legislation. The words “believe,”
“anticipate,” “intends,” “estimate,” “forecast,” “project,” “plan,”
“potential,” “may,” “should,” “expect,” “pending” and similar
expressions identify forward-looking statements.
The forward-looking statements in this press
release are based upon various assumptions, many of which are
based, in turn, upon further assumptions, including without
limitation, examination by the Company’s management of historical
operating trends, data contained in its 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.
In addition to these important factors, other
important factors that, in the Company’s view, could cause actual
results to differ materially from those discussed in the
forward-looking statements include general dry bulk shipping market
conditions, including fluctuations in charterhire rates and vessel
values; the strength of world economies; the stability of Europe
and the Euro; fluctuations in interest rates and foreign exchange
rates; changes in demand in the dry bulk shipping industry,
including the market for our vessels; changes in our operating
expenses, including bunker prices, dry docking and insurance costs;
changes in governmental rules and regulations or actions taken by
regulatory authorities; potential liability from pending or future
litigation; general domestic and international political
conditions; potential disruption of shipping routes due to
accidents or political events; the availability of financing and
refinancing; our ability to meet requirements for additional
capital and financing to complete our newbuilding program and grow
our business; the impact of the level of our indebtedness and the
restrictions in our debt agreements; vessel breakdowns and
instances of off‐hire; risks associated with vessel construction;
potential exposure or loss from investment in derivative
instruments; potential conflicts of interest involving our Chief
Executive Officer, his family and other members of our senior
management and our ability to complete acquisition transactions as
planned. Please see our filings with the Securities and Exchange
Commission for a more complete discussion of these and other risks
and uncertainties. The information set forth herein speaks only as
of the date hereof, and the Company disclaims any intention or
obligation to update any forward‐looking statements as a result of
developments occurring after the date of this communication.
Contacts
Company:Simos Spyrou, Christos
BeglerisCo ‐ Chief Financial Officers Star Bulk Carriers Corp.c/o
Star Bulk Management Inc.40 Ag. Konstantinou Av.Maroussi
15124Athens, GreeceEmail:
info@starbulk.com www.starbulk.com
Investor Relations / Financial Media:
Nicolas BornozisPresidentCapital Link, Inc.230
Park Avenue, Suite 1536New York, NY 10169Tel. (212) 661‐7566E‐mail:
starbulk@capitallink.com
www.capitallink.com
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