Seanergy Maritime Holdings Corp. (the "Company") (NASDAQ: SHIP)
announced today its financial results for the first quarter ended
March 31, 2013.
Financial Highlights:
First Quarter 2013
- Net Revenues of $5.6 million.
- EBITDA of $3.8 million.*
- Net Income of $1.1 million.
- Debt reduction of $31.8 million, or approximately 15% of the
Company's outstanding indebtedness.
(*) EBITDA is a non-GAAP measure. Please refer to the EBITDA,
Adjusted EBITDA and Adjusted Net Income/Loss reconciliation section
contained in this press release.
Management Discussion:
Stamatis Tsantanis, the Company's Chief
Executive Officer, stated:
"I am pleased to announce our first profitable financial quarter
since 2011, despite the challenging dry bulk market conditions. Our
net income was $1.1 million compared to a net loss of $6.4 million
for the same period last year. During the first quarter of 2013
charter rates continued to deteriorate and our average daily Time
Charter Equivalent ("TCE") rate decreased to $6,004 per vessel as
compared to $9,546 in the first quarter of 2012.
"Regarding our financial restructuring, since the beginning of
2012 and as of the date of this press release, we managed to reduce
our indebtedness to $176.9 million, from $346.4 million, through
finalized agreements with three out of our five lenders. In
addition, we have entered into an agreement with our fourth lender
for the sale of three MCS's vessel owning subsidiaries in exchange
for a nominal cash consideration and full satisfaction of the
underlying loan of approximately $38 million. After giving effect
to this transaction, we will have reduced our indebtedness by
approximately 61% to $135 million. We continue discussions with our
remaining lender, aiming to reach a solution that will enable
Seanergy to complete the restructuring of its outstanding
debt."
Christina Anagnostara, the Company's Chief
Financial Officer, stated:
"During the first quarter of 2013, net revenues were $5.6
million, 68% lower than in the same period in 2012 reflecting the
smaller size of our fleet and a 37% reduction of the daily TCE.
"For the first quarter of 2013, net income amounted to $1.1
million compared to a net loss for the first quarter of 2012 of
$6.4 million. After adjusting for $5.5 million gain on the sales of
four vessel owning subsidiaries and $0.9 million loss on vessel
impairment, Seanergy's net loss was $3.6 million compared to a net
loss of $4 million in the first quarter of 2012 after adjusting for
$2.3 million loss on sale of vessels. The reduction reflects the
significant decrease in interest and finance costs to $2.2 million
from $3.4 million in 2012.
We continue our efforts to achieve a viable financial structure
that will facilitate Seanergy's ability to benefit from the
eventual rebound in shipping markets. We believe that the recent
sale of our four Handysize owning subsidiaries and the forthcoming
sale of three additional Handysize owning subsidiaries, in full
satisfaction of the associated loan facilities, are positive for
Seanergy as they are expected to bring our total indebtedness down
to approximately $135 million."
First Quarter 2013 Financial Results:
Net Revenues
Net revenues for the first quarter of 2013 decreased to $5.6
million from $17.4 million in the same quarter of 2012. The
decrease of 68% in net revenues reflects lower freight rates earned
in the dry bulk market as compared to the same quarter last year,
as well as a 57% reduction in operating days that resulted from the
sale of vessel owning subsidiaries.
EBITDA and Adjusted EBITDA
Adjusted EBITDA was negative $0.8 million for the first quarter
of 2013, excluding $5.5 million of gains resulting from the sales
of subsidiaries and $0.9 million of non-cash impairment losses
associated with the African Oryx sale. Including the aforementioned
items, EBITDA stands positive at $3.8 million. For the first
quarter of 2012, Seanergy recorded Adjusted EBITDA of $4.9 million,
while EBITDA was $2.5 million.
For more information please refer to the EBITDA, Adjusted EBITDA
and Adjusted Net Loss/Income reconciliation section contained in
this press release.
Net Income/Loss
For the first quarter of 2013, net income amounted to $1.1
million or $0.09 per basic and diluted share, as compared to a net
loss for the first quarter of 2012 of $6.4 million, or $0.54 per
basic and diluted share, based on weighted average common shares
outstanding of 11,958,063 basic and 11,959,282 diluted for the
first quarter of 2013, and 11,803,933 basic and diluted for the
first quarter of 2012.
For the first quarter of 2013, adjusted net loss excluding gains
from the sales of subsidiaries and non-cash impairment losses was
$3.6 million, as compared to an adjusted net loss of $4.0 million
in 2012.
Debt Reduction
Seanergy ended the first quarter of 2013 with $176.9 million of
outstanding debt. This reflects the reduction of our outstanding
indebtedness by $31.8 million, during the three month period ended
March 31, 2013.
First Quarter 2013 Developments:
Sale of Subsidiaries in Satisfaction of DVB
Loan
On January 29, 2013, Seanergy's subsidiary, Maritime Capital
Shipping Limited ("MCS"), sold its 100% ownership interest in the
four companies that owned the Handysize dry bulk vessels Fiesta,
Pacific Fantasy, Pacific Fighter and Clipper Freeway for a nominal
consideration. In exchange for the sale, approximately $30.3
million of outstanding debt was discharged.
The buyer was a third-party nominee of the lenders under the
senior secured credit facility with DVB Merchant Bank (Asia) Ltd.,
as agent.
In connection to the sale, the Company's Board of Directors
obtained a fairness opinion from an independent third party.
Impairment of African Oryx
The Company assessed the recoverability of the carrying value,
including unamortized deferred dry docking costs, of the vessel
African Oryx due to its sale in the second quarter of 2013 and, as
a result, recognized an impairment loss of $0.9 million.
Subsequent Events:
Sale of African Oryx
On April 10, 2013, Seanergy sold the African Oryx, a 24,112 DWT
Handysize vessel built in 1997. Gross proceeds amounted to $4.1
million and were used to repay debt.
Receipt of NASDAQ Notice
The Company received a written notification from the Nasdaq
Capital Market ("Nasdaq" or the "Capital Market"), dated May 1,
2013, indicating that the Company is not in compliance with the
requirement to maintain a minimum of $2.5 million in stockholders'
equity for continued listing on the Capital Market, pursuant to
Nasdaq Listing Rule 5550(b)(1). The Company reported negative
stockholders' equity of $101.6 million for the fiscal year ended
December 31, 2012. In addition, as of April 30, 2013, the Company
did not meet the alternative standards for continued listing,
including a market value of listed securities of at least $35
million, pursuant to Nasdaq Listing Rule 5550(b)(2), or net income
from continuing operations of at least $500,000, pursuant to Nasdaq
Listing Rule 5550(b)(3).
In order to cure this deficiency, the Company must submit a plan
to Nasdaq to regain compliance by June 17, 2013. If the plan is
accepted by Nasdaq, the Company may be granted a grace period to
regain compliance of up to 180 days, expiring on or before October
28, 2013.
The Company is currently preparing a comprehensive plan that
will be submitted to Nasdaq in order to regain compliance with the
continued listing standards of the Capital Market.
Agreement for the Sale of Subsidiaries in
Satisfaction of UOB Loan
On May 6, 2013, Seanergy's subsidiary, MCS, entered into an
agreement with its fourth lender (United Overseas Bank) for the
sale of three vessel owning subsidiaries that own the Handysize
vessels African Joy, African Glory and Asian Grace, in exchange for
a nominal cash consideration and full satisfaction of the
underlying loan. The sale is subject to final documentation and is
expected to close within the second quarter of 2013 or any other
date as may be agreed between the Company and the lender. Upon the
closing of the transaction approximately $38 million of the
Company's outstanding debt will be discharged and the guarantee
provided by MCS will be fully released.
Prior to the sale of the shares, the Company's Board of
Directors will obtain a fairness opinion from an independent third
party.
Ability to Continue as a Going Concern
Over the past year and as of the date of this press release, the
Company has experienced significant losses and reduction in cash
which has affected its ability to satisfy its obligations due to
shipping sector volatility and economic difficulties. The Company
experienced significant reduction in cash flow, as it had to
re-charter its vessels at low prevailing rates.
As a result of the above, the Company defaulted under its loan
agreements in respect of certain covenants (including, in some
cases, the failure to make principal and interest payments, the
failure to satisfy financial covenants and the triggering of cross
default provisions). To date, the Company has not obtained waivers
of all these defaults from its lenders. Since January 1, 2012, the
Company has sold or otherwise disposed a total of 13 vessels (or
the ownership of certain of its vessel owning subsidiaries) and it
has entered into an agreement to sell three additional vessel
owning subsidiaries in connection with its debt restructuring.
Proceeds from the sale of remaining vessels are expected to be
insufficient to fully repay the related debt and, therefore, it is
likely that the Company will continue to have significant debt
unless it enters into satisfactory arrangements with its lenders
for the discharge of all such obligations. During the restructuring
process, the lenders have continued to reserve their rights in
respect of events of default under the loan agreements. The lenders
have not exercised their remedies at this time, including demand
for immediate payment. The lenders, however, could change their
position at any time. As such, there can be no assurance that a
satisfactory final agreement will be reached with the lenders in
the restructuring, or at all.
While the Company continues to use its best efforts to
restructure the debt of its remaining lender, there can be no
assurance that the negotiations will be successful or that it will
obtain waivers or amendments from its lender. Failure to obtain
such waivers or amendments could materially and adversely affect
the Company's business and operations. Furthermore, the impact of
the final terms of any restructuring is uncertain. Due to the
above, the Company's $176.9 million outstanding debt as of March
31, 2013 is classified as current.
Fleet Data & Average Daily Results:
Three Months Ended Three Months Ended
March 31, 2013 March 31, 2012
Fleet Data
Average number of vessels (1) 9.3 19.5
Ownership days (2) 836 1,770
Available days (3) 836 1,758
Operating days (4) 704 1,626
Fleet utilization (5) 84.2% 91.9%
Fleet utilization excludingdrydocking
off hire days (6) 84.2% 92.5%
Average Daily Results
TCE rate (7) 6,004 9,546
Vessel operating expenses (8) 4,146 4,701
Management fee (9) 344 337
Total vessel operating expenses (10) 4,490 5,038
(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
relevant period divided by the number of calendar days in the relevant
period.
(2)Ownership days are the total number of days in a period during which the
vessels in a fleet have been owned. Ownership days are an indicator of
the size of the Company's fleet over a period and affect both the amount
of revenues and the amount of expenses that the Company recorded during
a period.
(3)Available days are the number of ownership days less the aggregate
number of days that vessels are off-hire due to major scheduled repairs,
dry dockings or special or intermediate surveys. The shipping industry
uses available days to measure the number of ownership days in a period
during which vessels should be capable of generating revenues. During
the quarter ended March 31, 2013, the Company incurred zero off hire
days for vessel scheduled drydocking.
(4)Operating days are the number of available days in a period less the
aggregate number of days that vessels are off-hire due to any reason,
including unforeseen circumstances. The shipping industry uses operating
days to measure the aggregate number of days in a period during which
vessels actually generate revenues.
(5)Fleet utilization is the percentage of time that our vessels were
generating revenue, and is determined by dividing operating days by
ownership days for the relevant period.
(6)Fleet utilization excluding drydocking off hire days is calculated by
dividing the number of the fleet's operating days during a period by the
number of available days during that period. The shipping industry uses
fleet utilization excluding drydocking off hire days to measure a
Company's efficiency in finding suitable employment for its vessels and
excluding the amount of days that its vessels are off hire for reasons
such as scheduled repairs, vessel upgrades, or dry dockings or special
or intermediate surveys.
(7)TCE rates are defined as our net revenues less voyage expenses during a
period divided by the number of our operating days during the period,
which is consistent with industry standards. Voyage expenses include
port charges, bunker expenses, canal charges and other commissions.
(In thousands of US Dollars, except operating days and daily time charter
equivalent rate)
Three Months Ended March 31,
-----------------------------------
2013 2012
----------------- -----------------
Net revenues from vessels * 5,645 17,414
Voyage expenses 1,418 1,892
----------------- -----------------
Net operating revenues 4,227 15,522
----------------- -----------------
Operating days 704 1,626
Daily time charter equivalent rate 6,004 9,546
* Our TCE rate is calculated as the weighted average of the daily rate
earned under time charter contracts and of the daily rate earned by
bareboat agreements after deducting the relevant fixed operating expense
allowance. Net revenue from vessels under bareboat agreements is net of
operating expense allowance.
(8)Average daily vessel operating expenses, which include crew costs,
provisions, deck and engine stores, lubricating oil, insurance,
maintenance and repairs, are calculated by dividing vessel operating
expenses by ownership days for the relevant time periods:
(In thousands of US Dollars, except ownership days and daily vessel
operating expenses)
Three Months Ended March 31,
-------------------------------
2013 2012
--------------- ---------------
Operating expenses 3,466 8,321
Ownership days 836 1,770
Daily vessel operating expenses 4,146 4,701
(9)Daily management fees are calculated by dividing total management fees
by ownership days for the relevant time period.
(10)Total vessel operating expenses ("TVOE") is a measurement of total
expenses associated with operating the vessels. TVOE is the sum of
vessel operating expenses and management fees. Daily TVOE is calculated
by dividing TVOE by fleet ownership days for the relevant time period.
Fleet Profile and Employment:
As of June 12,2013
Charter
Vessel Name Vessel Capacity Year Built Charter Expiry
Class (DWT) Rate ($) (latest)
M/V Bremen Max Panamax 73,503 1993 Spot N/A
M/V Hamburg Max Panamax 73,498 1994 Spot N/A
M/V Davakis G. Supramax 54,051 2008 Spot N/A
M/V Delos Ranger Supramax 54,057 2008 Spot Aug. 2013
M/V African Joy (1) Handysize 26,482 1996 Floating June 2013
M/V African Glory Handysize 24,252 1998 Spot June 2013
M/V Asian Grace Handysize 20,412 1999 Spot June 2013
Total 326,255 13.5
(1)The calculation of the rate is based on the adjusted Time Charter
Average of the Baltic Handysize Index ("BHSI").
EBITDA, Adjusted EBITDA and Adjusted Net Income/(Loss) Reconciliation:
Three Months Ended Three Months Ended
March 31, 2013 March 31, 2012
Net income/(loss) 1,065 (6,368)
Plus: Interest and finance costs, net
(including interest income) 2,162 3,367
Plus: Income taxes 34 5
Plus: Depreciation and amortization 581 5,543
EBITDA 3,842 2,547
Plus: (Loss) on sale of vessels - (2,333)
Plus: Impairment charges (862) -
Minus: Gain on disposal of
subsidiaries 5,538 -
Adjusted EBITDA (834) 4,880
EBITDA consists of earnings before net interest and finance
cost, taxes, depreciation and amortization. Adjusted EBITDA
consists of earnings before net interest and finance cost, taxes,
depreciation and amortization and losses associated with the sale
of vessels, the impairment of the book values of vessels as well as
gain associated with disposal of subsidiaries. EBITDA and adjusted
EBITDA are not measurements of financial performance under
accounting principles generally accepted in the United States of
America, or U.S. GAAP and do not represent cash flow from
operations. EBITDA and adjusted EBITDA are presented solely as
supplemental disclosures because management believes that they are
common measures of operating performance in the shipping
industry.
Three Months Ended Three Months Ended
March 31, 2013 March 31, 2012
Net income/(loss) 1,065 (6,368)
Plus: (Loss) on sale of vessels - (2,333)
Plus: Impairment charges (862) -
Minus: Gain on disposal of
subsidiaries 5,538 -
Adjusted Net (loss) (3,611) (4,035)
Adjusted net loss consists of net loss before losses associated
with the sale of vessels, the impairment of the book values of
vessels as well as gain associated with disposal of
subsidiaries.
Conference Call and Webcast:
As announced, the Company's management team will host a
conference call today, June 12, 2013, at 9:30 a.m. EDT to discuss
the Company's financial results.
Conference Call details
Participants should dial into the call 10 minutes before the
scheduled time using the following numbers: 1(866) 819-7111 (from
the US), 0(800) 953-0329 (from the UK) or + (44) (0) 1452 542 301
(from outside the US). Please quote "Seanergy".
A replay of the conference call will be available until
Wednesday, June 19, 2013. The United States replay number is 1(866)
247-4222; from the UK 0(800) 953-1533; the standard international
replay number is (+44) (0) 1452 550 000 and the access code
required for the replay is: 2094507#.
Audio Webcast
There will also be a simultaneous live webcast of the conference
call over the Internet, through the Seanergy website
(www.seanergymaritime.com). Participants to the live webcast should
register on the website approximately 10 minutes prior to the start
of the webcast.
Seanergy Maritime Holdings Corp.
Condensed Consolidated Balance Sheets
March 31, 2013 (Unaudited) and December 31, 2012
(In thousands of US Dollars, except for share data, unless otherwise stated)
March 31, 2013 December 31,
(unaudited) 2012
-------------- --------------
ASSETS
Current assets:
Cash and cash equivalents 3,383 4,298
Restricted cash - 2,000
Accounts receivable trade, net 1,164 2,287
Inventories 1,861 471
Other current assets 1,418 2,190
Vessels held for sale 20,861 39,750
Deferred charges 903 1,090
-------------- -------------
Total current assets 29,590 52,086
-------------- -------------
Fixed assets:
Vessels, net 63,288 68,511
Office equipment, net - 2
-------------- -------------
Total fixed assets 63,288 68,513
-------------- -------------
Other assets
Deferred charges 141 220
Other non-current assets - 141
-------------- -------------
TOTAL ASSETS 93,019 120,960
============== =============
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt 176,882 208,649
Trade accounts and other payables 2,420 2,514
Due to related parties 7,034 6,135
Accrued expenses 1,448 1,159
Accrued interest 5,168 3,543
Financial instruments 493 491
Deferred revenue 122 86
-------------- -------------
Total current liabilities 193,567 222,577
-------------- -------------
-------------- -------------
Total liabilities 193,567 222,577
-------------- -------------
Commitments and contingencies - -
EQUITY
Seanergy shareholders' equity
Preferred stock, $0.0001 par value;
25,000,000 shares authorized; none issued - -
Common stock, $0.0001 par value;
500,000,000 authorized shares as at March
31, 2013 and December 31, 2012; 11,959,282
and 7,317,662 shares issued and
outstanding as at March 31, 2013 and
December 31, 2012, respectively 1 1
Additional paid-in capital 294,524 294,520
Accumulated deficit (395,073) (396,138)
-------------- -------------
Total equity (100,548) (101,617)
-------------- -------------
TOTAL LIABILITIES AND EQUITY 93,019 120,960
============== =============
Seanergy Maritime Holdings Corp.
Unaudited Consolidated Statements of Income / (Loss)
For the three months ended March 31, 2013 and 2012
(In thousands of US Dollars, except for share and per share data, unless
otherwise stated)
Three months ended
March 31,
-------------------------
2013 2012
----------- -----------
Revenues:
Vessel revenue - related party - 2,959
Vessel revenue 5,812 15,015
Commissions - related party - (109)
Commissions (167) (451)
----------- -----------
Vessel revenue, net 5,645 17,414
Expenses:
Direct voyage expenses (1,360) (1,730)
Vessel operating expenses (3,466) (8,321)
Voyage expenses - related party (58) (162)
Management fees - related party (203) (450)
Management fees (85) (146)
General and administration expenses (1,233) (1,446)
General and administration expenses - related
party (103) (102)
Amortization of deferred dry-docking costs (79) (1,164)
Depreciation (502) (4,379)
Loss on sale of vessels - (2,333)
Impairment loss for vessels and deferred
charges (862) -
Gain from disposal of subsidiaries 5,538 -
----------- -----------
Operating income / (loss) 3,232 (2,819)
Other income / (expense), net:
Interest and finance costs (2,166) (3,387)
Interest income 4 20
Loss on interest rate swaps (2) (140)
Foreign currency exchange gains / (losses),
net 31 (37)
----------- -----------
(2,133) (3,544)
----------- -----------
Net income / (loss) before taxes 1,099 (6,363)
----------- -----------
Income taxes (34) (5)
----------- -----------
Net income / (loss) 1,065 (6,368)
=========== ===========
Net income / (loss) per common share
Basic 0.09 (0.54)
=========== ===========
Diluted 0.09 (0.54)
=========== ===========
Weighted average common shares outstanding
Basic 11,958,063 11,803,933
=========== ===========
Diluted 11,959,282 11,803,933
=========== ===========
About Seanergy Maritime Holdings Corp.
Seanergy Maritime Holdings Corp. is a Marshall Islands
corporation with its executive offices in Athens, Greece. The
Company is engaged in the transportation of dry bulk cargoes
through the ownership and operation of dry bulk carriers.
As of today, the Company's fleet consists of 7 drybulk carriers
(two Panamax, two Supramax, and three Handysize vessels) with a
total carrying capacity of approximately 326,255 dwt and an average
fleet age of 13.5 years.
The Company's common stock trades on the NASDAQ Capital Market
under the symbol "SHIP".
Forward-Looking Statements
This press release contains forward-looking statements (as
defined in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended)
concerning future events and the Company's growth strategy and
measures to implement such strategy. Words such as "expects,"
"intends," "plans," "believes," "anticipates," "hopes,"
"estimates," and variations of such words and similar expressions
are intended to identify forward-looking statements. Although the
Company believes that such expectations will prove to have been
correct, these statements involve known and unknown risks and are
based upon a number of assumptions and estimates, which are
inherently subject to significant uncertainties and contingencies,
many of which are beyond the control of the Company. Actual results
may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual results
to differ materially include, but are not limited to, the scope and
timing of Securities and Exchange Commission ("SEC") and other
regulatory agency review, competitive factors in the market in
which the Company operates; risks associated with operations
outside the United States; and other factors listed from time to
time in the Company's filings with the SEC. The Company's filings
can be obtained free of charge on the SEC's website at www.sec.gov.
The Company expressly disclaims any obligations or undertaking to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company's
expectations with respect thereto or any change in events,
conditions or circumstances on which any statement is based.
For further information please contact: Investor
Relations / Media Capital Link, Inc. Paul Lampoutis 230 Park
Avenue Suite 1536 New York, NY 10169 Tel: (212) 661-7566 E-mail:
seanergy@capitallink.com
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