Safe Bulkers, Inc. (the “Company”) (NYSE: SB), an international
provider of marine drybulk transportation services, announced today
its unaudited financial results for the three and twelve months
period ended December 31, 2019.
Financial
highlights |
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|
In million U.S. Dollars except per share data |
Q4 2019 |
Q3 2019 |
Q2 2019 |
Q1 2019 |
Q4 2018 |
Twelve Months 2019 |
Twelve Months 2018 |
Net Revenues |
53.2 |
|
50.7 |
|
45.5 |
|
|
48.3 |
|
52.6 |
|
197.8 |
|
193.2 |
|
Net income |
3.6 |
|
5.2 |
|
1.8 |
|
|
5.4 |
|
9.5 |
|
16.0 |
|
27.7 |
|
Adjusted Net income [1] |
3.5 |
|
5.9 |
|
1.7 |
|
|
5.7 |
|
9.8 |
|
16.7 |
|
28.4 |
|
EBITDA2 |
23.1 |
|
24.5 |
|
21.2 |
|
|
24.6 |
|
28.9 |
|
93.5 |
|
102.3 |
|
Adjusted EBITDA 2 |
23.1 |
|
25.1 |
|
21.0 |
|
|
24.9 |
|
29.1 |
|
94.1 |
|
103.1 |
|
Earnings/(loss) per share basic and diluted 3 |
0.01 |
|
0.02 |
|
(0.01 |
) |
|
0.03 |
|
0.07 |
|
0.04 |
|
0.16 |
|
Adjusted earnings/(loss) per share basic and diluted 3 |
0.01 |
|
0.03 |
|
(0.01 |
) |
|
0.03 |
|
0.07 |
|
0.05 |
|
0.17 |
|
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Average Daily results
in U.S. Dollars |
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Time charter equivalent rate 4 |
13,707 |
|
13,311 |
|
11,970 |
|
|
12,280 |
|
13,875 |
|
12,805 |
|
13,102 |
|
Daily vessel operating expenses 5 |
5,103 |
|
4,448 |
|
4,615 |
|
|
4,153 |
|
4,353 |
|
4,582 |
|
4,360 |
|
Daily vessel operating expenses excluding dry-docking and
pre-delivery expenses 6 |
4,540 |
|
4,053 |
|
4,283 |
|
|
4,150 |
|
4,109 |
|
4,257 |
|
4,141 |
|
Daily general and administrative expenses 7 |
1,414 |
|
1,363 |
|
1,366 |
|
|
1,374 |
|
1,384 |
|
1,379 |
|
1,321 |
|
|
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In million U.S.
Dollars |
|
|
|
|
|
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|
Total Cash [8] |
120.1 |
|
87.0 |
|
90.2 |
|
|
82.9 |
|
92.5 |
|
|
|
Liquidity 9 |
178.0 |
|
87.0 |
|
90.2 |
|
|
82.9 |
|
92.5 |
|
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Total Debt 10 |
601.0 |
|
563.8 |
|
568.5 |
|
|
563.5 |
|
574.7 |
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|
Management Commentary
Dr. Loukas Barmparis, President of the Company,
said: “We closed 2019 profitably, having retrofitted scrubbers on
15 out of 20 vessels in total, noting commercial and operational
benefits. We have refinanced a large portion of our debt increasing
our liquidity to over $170 million, positioned ahead of
uncertainties and opportunities that markets may offer. During the
first quarter of 2020 the charter market has shown weakness due to
seasonality, intensified by the Novel Coronavirus outbreak, the
full impact of which is not yet known. Our management is closely
monitoring the evolving situation, having rescheduled the remaining
five scrubber installations for the second quarter of 2020.”
Common stock Issuance and Repurchase
program
In November 2019, the Company issued to an
unaffiliated third party 3,963,964 shares of common stock to pay
the second instalment of $6.6 million, as part of the purchase
price of its Post-Panamax class vessel on order.
During the fourth quarter of 2019, the Company
repurchased and cancelled 1,000,935 shares of its common
stock. As of February 21, 2020, the Company as part of an on
going repurchase program, has repurchased an additional 844,871
shares of common stock of which 834,136 have been cancelled.
As of February 21, 2020, the Company had
103,434,531 shares of common stock issued and outstanding.
Chartering our fleet
Our vessels are used to transport bulk cargoes,
particularly coal, grain and iron ore, along worldwide shipping
routes. We intend to employ our vessels on both period time
charters and spot time charters, according to our assessment of
market conditions, with some of the world’s largest consumers of
marine drybulk transportation services. The vessels we deploy on
period time charters provide us with relatively stable cash flow
and high utilization rates, while the vessels we deploy in the spot
market allow us to maintain our flexibility in low charter market
conditions.
Our contracted employment profile is presented
below in Table 1. The Company during the last quarter of 2019 has
opted to maintain the majority of its fleet in the spot charter
market.
Table 1: Contracted employment profile of
fleet ownership days as of February 21, 2020
2020 (remaining) |
26% |
|
2020 (full year) |
37% |
|
2021 |
7% |
|
2022 |
5% |
|
Detailed employment profile is presented in
Table 7. Scrubber benefit for scrubber fitted vessels is calculated
on the basis of fuel consumption of heavy fuel oil and price
differential between heavy fuel oil and compliant fuel cost for the
specific voyage and is either presented as part of the daily
charter hire in Table 7, or in cases where it can not be defined is
not part of the stated daily charter hire.
Liquidity
As of December 31, 2019, we had liquidity of
$178.0 million consisting of $106.4 million in cash and bank time
deposits, $13.7 million in restricted cash, $11.5 million available
under the sale and lease back transactions after the repayment of
the relevant loans, $20.0 million available under the unsecured
revolving credit facility and $26.4 million secured under a
commitment from a bank for the post-delivery financing of a
newbuild Post-Panamax class vessel.
As of February 21, 2020, we had liquidity
of $174.4 million consisting of $113.8 million in cash and bank
time deposits, $14.2 million in restricted cash, $20.0 million
available under the unsecured revolving credit facility and $26.4
million secured under a commitment from a bank for the
post-delivery financing of a newbuild Post-Panamax class
vessel.
Leverage, refinancing actions and
repayment profile
As of December 31, 2019, our consolidated debt
before deferred financing costs was $605.8 million and consolidated
leverage11, was 60% versus 56% as of December 31, 2018. In
December, the Company entered into sale and leaseback agreements
with respect to eight vessels with financial covenants in line with
the existing loan and credit facilities of the Company. The
proceeds from the sale and leaseback financing transactions, which
amounted to $158.3 million, were used to refinance loan facilities
of $105.2 million with terms expiring between 2023 and 2025, and
for general corporate purposes, resulting in additional liquidity
of $53.1 million. Under these arrangements, two vessels were leased
back, under bareboat charter agreements, for a period of six years
and six vessels were leased back under bareboat charter agreements,
for a period of up to eight years. Four of such arrangements
contemplate a purchase obligation at the end of the bareboat
charter period and purchase options commencing three years
following commencement of the bareboat charter period, and the
remaining four arrangements contemplate a purchase option five
years and nine months following commencement of the bareboat
charter period, all at predetermined purchase prices. The Company
has recorded these transactions as financing transactions.
The repayment schedule of the Company on a
pro-forma basis taking into account the sale and lease back
transactions which were completed in January 2020, compared to the
repayment schedule as of December 31, 2019, is presented below in
Table 2.
Table 2: Repayment Schedule as of
December 31, 2019, on an annual basis(in USD
millions)
|
2020 |
2021 |
2022 |
2023 |
2024 |
2025 |
2026 |
2027 |
TOTAL |
Repayment schedule as of December 31, 2019 |
65.5 |
90.7 |
89.1 |
77.5 |
189.9 |
61.1 |
5.4 |
26.6 |
605.8 |
Pro-forma repayment schedule after refinancing |
64.8 |
91.7 |
90.3 |
78.7 |
185.7 |
65.1 |
14.4 |
26.6 |
617.3 |
Order bookAs of
February 21, 2020, the remaining order book of the Company
consisted of one Post-Panamax class vessel with scheduled delivery
date in the second quarter of 2020.
Capital expenditure and financing
requirements related to order book
As of February 21, 2020, the aggregate
remaining capital expenditure in relation to the order book was
$20.2 million, all payable within 2020, on delivery of the vessel.
The Company has the option to pay up to $3.3 million of this
remaining capital expenditure through the issuance of the Company’s
common stock. In addition, the Company has secured $26.4
million under a commitment from a bank for the post-delivery
financing of the vessel.
Environmental Social Responsibility - Environmental
investments
In the context of our Environmental Social
Responsibility policies the Company is undertaking environmental
investments mainly in scrubbers and ballast water treatment
systems, the progress of which is presented below in Table 3. Our
environmental investments as of December 31, 2019, were $51.9
million. The Company has postponed for the second quarter of 2020
the scheduled BWTS and Scrubber installations due to corona-virus
outbreak affecting shipyards’ operations.
Table 3: Environmental investments
schedule
|
Completed installations until February 26, 2020 |
Expected installations in Q1 2020 |
Expected installations in Q2 2020 |
BWTS |
20 |
0 |
8 |
Scrubbers |
15* |
0 |
5 |
* MV Martine, MV Venus Horizon, MV Venus History, MV Andreas K,
MV Pedhoulas Cherry, MV Eleni, MV Venus Heritage, MV Pedhoulas
Farmer, MV Panayiota K, MV Sophia, MV Marina, MV Pedhoulas Rose, MV
Pedhoulas Fighter, MV Pedhoulas Builder, MV Agios Spyridonas.
Down time in relation to Dry docking and equipment
retrofits
The estimated downtime in relation to dry
dockings and equipment retrofits including scrubbers and ballast
water treatment system in 2020 is presented below in Table 4.
Table 4: Estimated Downtime in relation to Dry dockings
and equipment retrofits
|
Down time in days** |
|
Q1 2020 |
Q2 2020 |
Number of vessels |
3 |
8 |
Total down time |
82 |
265 |
** Down time includes scheduled dry-docking or special surveys
to be performed concurrently with scrubber installation where
applicable.
Bunker fuel contracts
The Company enters, from time to time, into
bunker fuel contracts, with the objective of reducing the risk
arising from changes in the price differential between very low
sulphur fuel oil and high sulphur fuel oil.
Dividend Policy
The Company has not declared a dividend on the
Company’s common stock for the fourth quarter of 2019.
The Company declared a cash dividend of $0.50
per share on each of its 8.00% Series C Cumulative Redeemable
Perpetual Preferred Shares (NYSE: SB.PR.C) and 8.00% Series D
Cumulative Redeemable Perpetual Preferred Shares (NYSE: SB.PR.D)
for the period from October 31, 2019 to January 29, 2020, which was
paid on January 30, 2020 to the respective shareholders of record
as of January 23, 2020.
A Company’s subsidiary declares a cash dividend
on a quarterly basis on each of such subsidiary’s 2.95% Series A
Cumulative Redeemable Perpetual Preferred Shares (‘Series A
shares’) to the respective shareholders of record, presented under
the caption “Mezzanine Equity” in the condensed consolidated
balance sheets. The aggregate cash dividend declared for the Series
A shares for the period from October 1, 2019 to December 31, 2019,
which was paid on January 6, 2020, was $0.1 million. The aggregate
cash dividend declared for the Series A shares for the period from
January 1, 2020 to March 31, 2020, payable on March 31, 2020, is
$0.1 million.
The declaration and payment of dividends, if
any, will always be subject to the discretion of the Board of
Directors of the Company. The timing and amount of any dividends
declared will depend on, among other things: (i) the Company’s
earnings, financial condition and cash requirements and available
sources of liquidity; (ii) decisions in relation to the Company’s
growth and leverage strategies; (iii) provisions of Marshall
Islands and Liberian law governing the payment of dividends; (iv)
restrictive covenants in the Company’s existing and future debt
instruments; and (v) global economic and financial conditions.
Conference Call
On Thursday, February 27, 2020 at 8:30 A.M.
Eastern Time, the Company’s management team will host a conference
call to discuss the Company’s financial results.
Participants should dial into the call 10
minutes before the scheduled time using the following numbers: 1
(877) 553-9962 (US Toll Free Dial In), 0(808) 238-0669 (UK Toll
Free Dial In) or +44 (0) 2071 928592 (Standard International Dial
In). Please quote Safe Bulkers to the
operator.
A telephonic replay of the conference call will
be available until March 6, 2020 by dialing 1 (866) 331-1332 (US
Toll Free Dial In), 0(808) 238-0667 (UK Toll Free Dial In) or +44
(0) 3333 009785 (Standard International Dial In). Access Code:
1859591#
Slides and Audio Webcast
There will also be a live, and then archived,
webcast of the conference call, available through the Company’s
website (www.safebulkers.com). Participants in the live webcast
should register on the website approximately 10 minutes prior to
the start of the webcast.
Management Discussion of Fourth Quarter
2019 Results
Net income for the fourth quarter of 2019
amounted to $3.6 million compared to $9.5 million during the same
period in 2018, mainly due to the following factors:
Net revenues: Net revenues increased by 1% to
$53.2 million for the fourth quarter of 2019, compared to $52.6
million for the same period in 2018 in a weak chartering market
during the last quarter of 2019, when charter hires were gradually
declining but additional revenues reflecting increased ballast
bonus compensation were realized.
Vessel operating expenses: Vessel operating
expenses increased by 17% to $19.2 million for the fourth quarter
of 2019 compared to $16.4 million for the same period in 2018,
mainly as a result of: i) dry docking expense of $2.1 million
related to five dry dockings fully completed and one dry-docking
partially completed during the fourth quarter of 2019, compared to
$0.9 million related to three dry-dockings fully completed and one
dry-docking partially completed during for the same period of 2018,
ii) spares of $2.5 million for the fourth quarter of 2019, compared
to $1.8 million for the same period in 2018 and iii) repairs and
maintenance of $1.5 million for the fourth quarter of 2019,
compared to $1.2 million for the same period in 2018. The Company
expenses dry-docking and pre-delivery costs as incurred, which
costs may vary from period to period. Excluding dry-docking
and pre-delivery costs of $2.1 and $0.9 million for the fourth
quarter of 2019 and 2018 respectively, vessel operating expenses
increased by 10% to $17.1 million for the fourth quarter of 2019,
compared to $15.5 million for the same period in 2018 due to
completed and forthcoming dry-dockings affecting costs of spares
and repairs and maintenance as above. Dry-docking expense is
related to the number of dry-dockings in each period and
pre-delivery expenses to the number of vessel deliveries and second
hand acquisitions in each period. Certain other shipping companies
may defer and amortize dry-docking expense and many do not include
dry-docking expenses within vessel operating expenses costs and
present these separately.
Depreciation: Depreciation increased by 3% to
$12.9 million for the fourth quarter of 2019, compared to $12.5
million for the same period in 2018, as a result of the
commencement of depreciation of additional environmental
investments that were completed following the fourth quarter of
2018.
Interest expense: Interest expense decreased to
$6.2 million in the fourth quarter of 2019 compared to $6.7 million
for the same period in 2018, as a result of the decreased USD
LIBOR12 affecting the weighted average interest rate of our loans
and credit facilities.
Voyage expenses: Voyage expenses increased to
$5.1 million for the fourth quarter of 2019 compared to $1.5
million for the same period in 2018, as a result of increased
vessel repositioning expenses and decreased prices of fuel sold on
delivery.
Daily vessel operating expenses13: Daily vessel
operating expenses, calculated by dividing vessel operating
expenses by the ownership days of the relevant period, increased by
17% to $5,103 for the fourth quarter of 2019 compared to $4,353 for
the same period in 2018. Daily vessel operating expenses excluding
dry-docking and pre-delivery expenses increased by 10% to $4,540
for the fourth quarter of 2019 compared to $4,109 for the same
period in 2018.
Daily general and administrative expenses13:
Daily general and administrative expenses, which include daily
management fees payable to our Managers14 and daily company
administration expenses , increased by 2% to $1,414 for the fourth
quarter of 2019, compared to $1,384 for the same period in 2018,
mainly due to increased administration expenses partly offset by
the reduction of the management fees due to the weakening in the
exchange rate of Euro versus United States Dollar.
Unaudited Interim Financial Information
and Other Data
SAFE BULKERS,
INC.CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (UNAUDITED)(In thousands of
U.S. Dollars except for share and per share data)
|
Three-Months Period Ended December
31, |
|
Twelve-Months Period Ended December
31, |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
REVENUES: |
|
|
|
|
|
|
|
Revenues |
54,946 |
|
|
|
55,711 |
|
|
|
201,548 |
|
|
|
206,682 |
|
|
Commissions |
(2,373 |
) |
|
|
(2,465 |
) |
|
|
(8,357 |
) |
|
|
(8,921 |
) |
|
Net revenues |
52,573 |
|
|
|
53,246 |
|
|
|
193,191 |
|
|
|
197,761 |
|
|
EXPENSES: |
|
|
|
|
|
|
|
Voyage expenses |
(1,458 |
) |
|
|
(5,051 |
) |
|
|
(6,378 |
) |
|
|
(13,715 |
) |
|
Vessel operating expenses |
(16,418 |
) |
|
|
(19,249 |
) |
|
|
(63,512 |
) |
|
|
(68,569 |
) |
|
Depreciation |
(12,518 |
) |
|
|
(12,935 |
) |
|
|
(48,067 |
) |
|
|
(50,310 |
) |
|
General and administrative expenses |
(5,221 |
) |
|
|
(5,332 |
) |
|
|
(19,242 |
) |
|
|
(20,639 |
) |
|
Loss on inventory valuation |
— |
|
|
|
(66 |
) |
|
|
— |
|
|
|
(414 |
) |
|
Early redelivery cost |
— |
|
|
|
— |
|
|
|
(105 |
) |
|
|
(63 |
) |
|
Operating income |
16,958 |
|
|
|
10,613 |
|
|
|
55,887 |
|
|
|
44,051 |
|
|
OTHER (EXPENSE) /
INCOME: |
|
|
|
|
|
|
|
Interest expense |
(6,680 |
) |
|
|
(6,174 |
) |
|
|
(25,713 |
) |
|
|
(26,815 |
) |
|
Other finance cost |
(338 |
) |
|
|
(502 |
) |
|
|
(973 |
) |
|
|
(714 |
) |
|
Interest income |
236 |
|
|
|
328 |
|
|
|
929 |
|
|
|
1,558 |
|
|
(Loss)/gain on derivatives |
— |
|
|
|
(121 |
) |
|
|
18 |
|
|
|
(121 |
) |
|
Foreign currency (loss)/gain |
(213 |
) |
|
|
219 |
|
|
|
(670 |
) |
|
|
(76 |
) |
|
Amortization and write-off of deferred finance charges |
(426 |
) |
|
|
(809 |
) |
|
|
(1,794 |
) |
|
|
(1,845 |
) |
|
Net income |
9,537 |
|
|
|
3,554 |
|
|
|
27,684 |
|
|
|
16,038 |
|
|
Less Preferred dividend |
2,873 |
|
|
|
2,878 |
|
|
|
11,384 |
|
|
|
11,498 |
|
|
(Less)/plus Mezzanine equity measurement |
— |
|
|
|
(104 |
) |
|
|
— |
|
|
|
199 |
|
|
Net income available to common shareholders |
|
6,664 |
|
|
|
780 |
|
|
|
16,300 |
|
|
|
4,341 |
|
|
Earnings per share basic and diluted |
0.07 |
|
|
|
0.01 |
|
|
|
0.16 |
|
|
|
0.04 |
|
|
Weighted average number of shares |
102,100,829 |
|
|
|
102,631,267 |
|
|
|
101,604,339 |
|
|
|
101,686,312 |
|
|
|
|
Twelve-Months Period Ended December
31, |
|
|
2018 |
|
2019 |
(In millions of
U.S. Dollars) |
|
|
|
|
CASH FLOW
DATA |
|
|
|
|
Net cash provided by operating activities |
|
85.4 |
|
|
58.3 |
|
Net cash used in investing
activities |
|
(63.7 |
) |
|
(36.8 |
) |
Net cash (used in)/provided by
financing activities |
|
(15.6 |
) |
|
8.5 |
|
Net increase in cash and cash
equivalents |
|
6.1 |
|
|
30.0 |
|
SAFE BULKERS,
INC.CONDENSED CONSOLIDATED
BALANCE SHEETS (UNAUDITED)(In thousands of U.S.
Dollars)
|
|
December 31, 2018 |
|
December 31, 2019 |
ASSETS |
|
|
|
|
Cash, time deposits, and restricted cash |
|
82,084 |
|
|
106,378 |
|
Other current assets |
|
19,178 |
|
|
29,611 |
|
Vessels, net |
|
955,291 |
|
|
944,706 |
|
Advances for vessels |
|
8,596 |
|
|
19,294 |
|
Restricted cash non-current |
|
10,401 |
|
|
13,701 |
|
Other non-current assets |
|
649 |
|
|
953 |
|
Total assets |
|
1,076,199 |
|
|
1,114,643 |
|
LIABILITIES AND EQUITY |
|
|
|
|
Current portion of long-term debt |
|
36,185 |
|
|
64,054 |
|
Other current liabilities |
|
18,421 |
|
|
22,730 |
|
Long-term debt, net of current portion |
|
538,508 |
|
|
536,995 |
|
Other non-current liabilities |
|
253 |
|
|
922 |
|
Mezzanine equity |
|
16,998 |
|
|
17,200 |
|
Shareholders’ equity |
|
465,834 |
|
|
472,742 |
|
Total liabilities and equity |
|
1,076,199 |
|
|
1,114,643 |
|
TABLE 5 RECONCILIATION
OF ADJUSTED NET INCOME, EBITDA, ADJUSTED EBITDA AND ADJUSTED
EARNINGS PER SHARE
|
|
Three-Months Period Ended December
31, |
|
Twelve-Months Period Ended December
31, |
(In thousands of U.S. Dollars
except for share and per share data) |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
Net Income - Adjusted
Net Income |
|
|
|
|
|
|
|
|
Net Income |
|
9,537 |
|
|
3,554 |
|
|
27,684 |
|
|
16,038 |
|
Plus Loss/(gain)on
derivatives |
|
— |
|
|
121 |
|
|
(18 |
) |
|
121 |
|
Plus Foreign currency
loss/(gain) |
|
213 |
|
|
(219 |
) |
|
670 |
|
|
76 |
|
Plus Early redelivery cost |
|
— |
|
|
— |
|
|
105 |
|
|
63 |
|
Plus Loss on inventory
valuation |
|
— |
|
|
66 |
|
|
— |
|
|
414 |
|
Adjusted Net
income |
|
9,750 |
|
|
3,522 |
|
|
28,441 |
|
|
16,712 |
|
EBITDA - Adjusted
EBITDA |
|
|
|
|
|
|
|
|
Net income |
|
9,537 |
|
|
3,554 |
|
|
27,684 |
|
|
16,038 |
|
Plus Net Interest expense |
|
6,444 |
|
|
5,846 |
|
|
24,784 |
|
|
25,257 |
|
Plus Depreciation |
|
12,518 |
|
|
12,935 |
|
|
48,067 |
|
|
50,310 |
|
Plus Amortization |
|
426 |
|
|
809 |
|
|
1,794 |
|
|
1,845 |
|
EBITDA |
|
28,925 |
|
|
23,144 |
|
|
102,329 |
|
|
93,450 |
|
Plus Early Redelivery
cost |
|
— |
|
|
— |
|
|
105 |
|
|
63 |
|
Plus Loss on inventory
valuation |
|
— |
|
|
66 |
|
|
— |
|
|
414 |
|
Plus Loss/(gain)on
derivatives |
|
— |
|
|
121 |
|
|
(18 |
) |
|
121 |
|
Plus Foreign currency
loss/(gain) |
|
213 |
|
|
(219 |
) |
|
670 |
|
|
76 |
|
ADJUSTED
EBITDA |
|
29,138 |
|
|
23,112 |
|
|
103,086 |
|
|
94,124 |
|
Earnings per
share |
|
|
|
|
|
|
|
|
Net income |
|
9,537 |
|
|
3,554 |
|
|
27,684 |
|
|
16,038 |
|
Less Preferred dividend |
|
2,873 |
|
|
2,878 |
|
|
11,384 |
|
|
11,498 |
|
(Less)/plus Mezzanine equity
measurement |
|
— |
|
|
(104 |
) |
|
— |
|
|
199 |
|
Net income available to common
shareholders |
|
6,664 |
|
|
780 |
|
|
16,300 |
|
|
4,341 |
|
Weighted average number of
shares |
|
102,100,829 |
|
|
102,631,267 |
|
|
101,604,339 |
|
|
101,686,312 |
|
Earnings per
share |
|
0.07 |
|
|
0.01 |
|
|
0.16 |
|
|
0.04 |
|
Adjusted Net Income -
Adjusted Earnings per share |
|
|
|
|
|
|
|
|
Adjusted Net
Income |
|
9,750 |
|
|
3,522 |
|
|
28,441 |
|
|
16,712 |
|
Less Preferred dividend |
|
2,873 |
|
|
2,878 |
|
|
11,384 |
|
|
11,498 |
|
(Less)/plus Mezzanine
measurement |
|
— |
|
|
(104 |
) |
|
— |
|
|
199 |
|
Adjusted Net income available
to common shareholders |
|
6,877 |
|
|
748 |
|
|
17,057 |
|
|
5,015 |
|
Weighted average number of
shares |
|
102,100,829 |
|
|
102,631,267 |
|
|
101,604,339 |
|
|
101,686,312 |
|
Adjusted Earnings per
share |
|
0.07 |
|
|
0.01 |
|
|
0.17 |
|
|
0.05 |
|
- EBITDA, Adjusted EBITDA, Adjusted Net income and Adjusted
earnings per share are not recognized measurements under US
GAAP.
- EBITDA represents Net income before interest, income tax
expense, depreciation and amortization.
- Adjusted EBITDA represents EBITDA before loss on sale of
assets, gain/(loss) on derivatives, early redelivery cost, loss on
inventory valuation and gain/(loss) on foreign currency.
- Adjusted Net income represents Net income before loss on sale
of assets, gain/(loss) on derivatives, early redelivery cost, loss
on inventory valuation and gain/(loss) on foreign currency.
- Adjusted earnings per share represents Adjusted Net income less
preferred dividend and (less)/plus mezzanine equity measurement
divided by the weighted average number of shares.
- EBITDA, Adjusted EBITDA, Adjusted Net income and Adjusted
earnings per share are used as supplemental financial measures by
management and external users of financial statements, such as
investors, to assess our financial and operating performance. The
Company believes that these non-GAAP financial measures assist our
management and investors by increasing the comparability of our
performance from period to period. The Company believes that
including these supplemental financial measures assists our
management and investors in (i) understanding and analyzing the
results of our operating and business performance, (ii) selecting
between investing in us and other investment alternatives and (iii)
monitoring our financial and operational performance in assessing
whether to continue investing in us. The Company believes that
EBITDA, Adjusted EBITDA, Adjusted Net income and Adjusted earnings
per share are useful in evaluating the Company’s operating
performance from period to period because the calculation of EBITDA
generally eliminates the effects of financings, income taxes and
the accounting effects of capital expenditures and acquisitions,
the calculation of Adjusted EBITDA generally further eliminates the
effects from gain/(loss) on derivatives, early redelivery cost,
loss on inventory valuation and gain/(loss) on foreign currency,
items which may vary from year to year and for different companies
for reasons unrelated to overall operating performance.
Furthermore, the calculation of Adjusted Net income generally
eliminates the effects of gain/(loss) on derivatives, early
redelivery cost, loss on inventory valuation and gain/(loss) on
foreign currency, items which may vary from year to year and for
different companies for reasons unrelated to overall operating
performance. EBITDA, Adjusted EBITDA, Adjusted Net income and
Adjusted earnings per share have limitations as analytical tools,
and should not be considered in isolation, or as a substitute for
analysis of the Company’s results as reported under US GAAP.
EBITDA, Adjusted EBITDA, Adjusted Net income should not be
considered as substitutes for net income and other operations data
prepared in accordance with US GAAP or as a measure of
profitability. While EBITDA and Adjusted EBITDA, Adjusted Net
income and Adjusted earnings per share, are frequently used as
measures of operating results and performance, they are not
necessarily comparable to other similarly titled captions of other
companies due to differences in methods of calculation. In
evaluating Adjusted EBITDA, Adjusted Net income and Adjusted
earnings per share, you should be aware that in the future we may
incur expenses that are the same as or similar to some of the
adjustments in this presentation. Our presentation of Adjusted
EBITDA, Adjusted Net income and Adjusted earnings per share should
not be construed as an inference that our future results will be
unaffected by the excluded items.
TABLE 6: FLEET DATA AND AVERAGE DAILY
INDICATORS
|
Three-Months Period Ended December
31, |
|
Twelve-Months Period Ended December
31, |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
FLEET DATA |
|
|
|
|
|
|
|
Number of vessels at period’s
end |
41 |
|
|
|
41 |
|
|
|
41 |
|
|
|
41 |
|
|
Average age of fleet (in
years) |
8.33 |
|
|
|
9.33 |
|
|
|
8.33 |
|
|
|
9.33 |
|
|
Ownership days (1) |
3,772 |
|
|
|
3,772 |
|
|
|
14,568 |
|
|
|
14,965 |
|
|
Available days (2) |
3,684 |
|
|
|
3,516 |
|
|
|
14,258 |
|
|
|
14,373 |
|
|
Operating days (3) |
3,642 |
|
|
|
3,407 |
|
|
|
14,075 |
|
|
|
14,012 |
|
|
Fleet utilization on ownership
days (4) |
96.6 |
|
% |
|
90.3 |
|
% |
|
96.6 |
|
% |
|
93.6 |
|
% |
Fleet utilization on available
days (5) |
98.9 |
|
% |
|
96.9 |
|
% |
|
98.7 |
|
% |
|
97.5 |
|
% |
Average number of vessels in
the period (6) |
41.00 |
|
|
|
41.00 |
|
|
|
39.91 |
|
|
|
41.00 |
|
|
AVERAGE DAILY RESULTS |
|
|
|
|
|
|
|
Time charter equivalent rate (7) |
$ |
13,875 |
|
|
|
$ |
13,707 |
|
|
|
$ |
13,102 |
|
|
|
$ |
12,805 |
|
|
Daily vessel operating
expenses (8) |
$ |
4,353 |
|
|
|
$ |
5,103 |
|
|
|
$ |
4,360 |
|
|
|
$ |
4,582 |
|
|
Daily vessel operating
expenses excluding dry-docking and pre-delivery expenses (9) |
$ |
4,109 |
|
|
|
$ |
4,540 |
|
|
|
$ |
4,141 |
|
|
|
$ |
4,257 |
|
|
Daily general and
administrative expenses (10) |
$ |
1,384 |
|
|
|
$ |
1,414 |
|
|
|
$ |
1,321 |
|
|
|
$ |
1,379 |
|
|
TIME CHARTER EQUIVALENT RATE
RECONCILIATION |
|
|
|
|
|
|
|
(In thousands of U.S. Dollars
except for available days and Time charter equivalent rate) |
|
|
|
|
|
|
|
Revenues |
$ |
54,946 |
|
|
|
$ |
55,711 |
|
|
|
$ |
201,548 |
|
|
|
$ |
206,682 |
|
|
Less commissions |
(2,373 |
) |
|
|
(2,465 |
) |
|
|
(8,357 |
) |
|
|
(8,921 |
) |
|
Less voyage expenses |
(1,458 |
) |
|
|
(5,051 |
) |
|
|
(6,378 |
) |
|
|
(13,715 |
) |
|
Time charter equivalent
revenue |
$ |
51,115 |
|
|
|
$ |
48,195 |
|
|
|
$ |
186,813 |
|
|
|
$ |
184,046 |
|
|
Available days (2) |
3,684 |
|
|
|
3,516 |
|
|
|
14,258 |
|
|
|
14,373 |
|
|
Time charter equivalent rate
(7) |
$ |
13,875 |
|
|
|
$ |
13,707 |
|
|
|
$ |
13,102 |
|
|
|
$ |
12,805 |
|
|
_____________
(1) Ownership days represents the aggregate number of days in a
period during which each vessel in our fleet has been owned by us.
(2) Available days represents the total number of days in a
period during which each vessel in our fleet was in our possession,
net of off-hire days associated with scheduled maintenance, which
includes major repairs, dry dockings, vessel upgrades or special or
intermediate surveys. (3) Operating days represents the number
of our available days in a period less the aggregate number of days
that our vessels are offhire due to any reason, excluding scheduled
maintenance. (4) Fleet utilization on ownership days is
calculated by dividing the number of operating days by the number
of ownership days for the relevant period, representing a shipping
industry performance measure. This measure demonstrates the
percentage of time in the relevant period our vessels generate
revenue. (5) Fleet utilization on available days is calculated
by dividing the number of operating days by the number of available
days during the same period representing a shipping industry
performance measure used to measure the ability of the Company to
find suitable employment for its vessels and minimize the off- hire
days for reasons other than scheduled maintenance, repairs,
dry-dockings, vessel upgrades and special or intermediate surveys.
(6) Average number of vessels in the period is calculated by
dividing ownership days in the period by the number of days in that
period. (7) Time charter equivalent rate, or TCE rate,
represents our charter revenues less commissions and voyage
expenses during a period divided by the number of available days
during such period. TCE rate is a standard shipping industry
performance measure used primarily to compare daily earnings
generated by vessels on period time charters and spot time charters
with daily earnings generated by vessels on voyage charters,
because charter rates for vessels on voyage charters are generally
not expressed in per day amounts, while charter rates for vessels
on period time charters and spot time charters generally are
expressed in such amounts. We have only rarely employed our vessels
on voyage charters and, as a result, generally our TCE rates
approximate our time charter rates. (8) Daily vessel operating
expenses are calculated by dividing vessel operating expenses for
the relevant period by ownership days for such period. Vessel
operating expenses include crewing, insurance, lubricants, spare
parts, provisions, stores, repairs, maintenance including
dry-docking, statutory and classification expenses and other
miscellaneous items. (9) Daily vessel operating expenses
excluding dry-docking and pre-delivery expenses are calculated by
dividing vessel operating expenses excluding dry-docking and
pre-delivery expenses for the relevant period by ownership days for
such period. Dry-docking expenses include costs of shipyard, paints
and agent expenses and pre-delivery expenses include initially
supplied spare parts, stores, provisions and other miscellaneous
items provided to a newbuild or second hand acquisition prior to
their operation. (10) Daily general and administrative
expenses are calculated by dividing general and administrative
expenses for the relevant period by ownership days for such period.
Daily general and administrative expenses include daily management
fees payable to our Managers and daily company administration
expenses.
Table 7: Detailed fleet and employment
profile as of February 21, 2020
Vessel Name |
DWT |
Year Built |
Country of construction |
Daily Gross Charter Rate1 |
Charter Duration2 |
Panamax |
Maria |
76,000 |
2003 |
Japan |
$9,349 |
February 2020 |
December 2020 |
Koulitsa |
76,900 |
2003 |
Japan |
$5,473 |
December 2019 |
April 2020 |
Paraskevi 6 |
74,300 |
2003 |
Japan |
Dry docking |
|
|
Vassos |
76,000 |
2004 |
Japan |
$12,900 |
September 2019 |
March 2020 |
Katerina |
76,000 |
2004 |
Japan |
$8,051 |
February 2020 |
November 2020 |
Maritsa |
76,000 |
2005 |
Japan |
$9,436 |
February 2020 |
November 2020 |
Efrossini |
75,000 |
2012 |
Japan |
$5,634 |
January 2020 |
April 2020 |
Zoe 9 |
75,000 |
2013 |
Japan |
$7,791 |
January 2020 |
April 2020 |
Kypros Land 9 |
77,100 |
2014 |
Japan |
$4,670 |
January 2020 |
March 2020 |
Kypros Sea |
77,100 |
2014 |
Japan |
$13,850 |
May 2019 |
March 2020 |
Kypros Bravery |
78,000 |
2015 |
Japan |
$10,679 |
November 2019 |
February 2020 |
Kypros Sky 7 |
77,100 |
2015 |
Japan |
$9,048 |
January 2020 |
March 2020 |
Kypros Loyalty |
78,000 |
2015 |
Japan |
$6,007 |
February 2020 |
April 2020 |
Kypros Spirit 7 |
78,000 |
2016 |
Japan |
$4,044 |
January 2020 |
April 2020 |
Kamsarmax |
Pedhoulas Merchant |
82,300 |
2006 |
Japan |
$7,000 |
February 2020 |
March 2020 |
Pedhoulas Trader |
82,300 |
2006 |
Japan |
$12,000 |
May 2019 |
March 2020 |
Pedhoulas Leader |
82,300 |
2007 |
Japan |
$6,618 |
February 2020 |
April 2020 |
Pedhoulas Commander |
83,700 |
2008 |
Japan |
$10,850 |
April 2019 |
March 2020 |
Pedhoulas Builder |
81,600 |
2012 |
China |
$8,86211 |
February 2020 |
May 2020 |
Pedhoulas Fighter |
81,600 |
2012 |
China |
$9,22411 |
January 2020 |
April 2020 |
Pedhoulas Farmer 3 |
81,600 |
2012 |
China |
$10,31411 |
December 2019 |
February 2020 |
Pedhoulas Cherry |
82,000 |
2015 |
China |
$10,82311 |
January 2020 |
April 2020 |
Pedhoulas Rose 3 |
82,000 |
2017 |
China |
$6,25011 |
January 2020 |
February 2020 |
Pedhoulas Cedrus |
81,800 |
2018 |
Japan |
$8,042 |
February 2020 |
April 2020 |
Post-Panamax |
Marina |
87,000 |
2006 |
Japan |
$6,33011 |
February 2020 |
March 2020 |
Xenia |
87,000 |
2006 |
Japan |
$1,17312 |
January 2020 |
February 2020 |
Sophia |
87,000 |
2007 |
Japan |
$8,75110 |
February 2020 |
March 2020 |
Eleni |
87,000 |
2008 |
Japan |
$9,94610 |
January 2020 |
April 2020 |
Martine |
87,000 |
2009 |
Japan |
$10,40011 |
February 2020 |
March 2020 |
Andreas K |
92,000 |
2009 |
South Korea |
$7,25011 |
February 2020 |
April 2020 |
Panayiota K 8 |
92,000 |
2010 |
South Korea |
$8,43511 |
February 2020 |
March 2020 |
Agios Spyridonas 8 |
92,000 |
2010 |
South Korea |
$6,06511 |
February 2020 |
April 2020 |
Venus Heritage 9 |
95,800 |
2010 |
Japan |
$5,83511 |
January 2020 |
March 2020 |
Venus History 9 |
95,800 |
2011 |
Japan |
$6,60711 |
February 2020 |
April 2020 |
Venus Horizon |
95,800 |
2012 |
Japan |
$6,43711 |
February 2020 |
March 2020 |
Troodos Sun |
85,000 |
2016 |
Japan |
$4,986 |
January 2020 |
February 2020 |
Troodos Air |
85,000 |
2016 |
Japan |
$6,354 |
February 2020 |
March 2020 |
Capesize |
Mount Troodos |
181,400 |
2009 |
Japan |
$18,000 |
July 2019 |
February 2020 |
Kanaris |
178,100 |
2010 |
China |
$26,5624 |
September 2011 |
June 2031 |
Pelopidas |
176,000 |
2011 |
China |
$38,000 |
January 2012 |
January 2022 |
Lake Despina |
181,400 |
2014 |
Japan |
$24,3765 |
January 2014 |
January 2024 |
Dwt of existing fleet |
3,777,000 |
|
Orderbook |
TBN |
85,000 |
1H 2020 |
Japan |
|
|
|
1. Charter rate is the recognized gross daily
charter rate. For charter parties with variable rates among periods
or consecutive charter parties with the same charterer, the
recognized gross daily charter rate represents the weighted average
gross daily charter rate over the duration of the applicable
charter period or series of charter periods, as applicable. In case
a charter agreement provides for additional payments, namely
ballast bonus to compensate for vessel repositioning, the gross
daily charter rate presented has been adjusted to reflect estimated
vessel repositioning expenses. In case of voyage charters the
charter rate represents revenue recognized on a pro-rata basis over
the duration of the voyage from load to discharge port less related
voyage expenses. 2. The start date represents either the actual
start date or, in the case of a contracted charter that had not
commenced as of February 21, 2020, the scheduled start date.
The actual start date and redelivery date may differ from the
referenced scheduled start and redelivery dates depending on the
terms of the charter and market conditions and does not reflect the
options to extend the period time charter.3. MV Pedhoulas
Farmer and MV Pedhoulas Rose were sold and leased back, in 2015 and
2017, respectively, on a bareboat charter basis for a period of 10
years, with a purchase obligation at the end of the bareboat
charter period and purchase options in favour of the Company after
the second year of the bareboat charter, at annual intervals and
predetermined purchase prices.4. Charterer agreed to reimburse us
for a fixed amount for the cost of the scrubber and BWTS to be
installed on the vessel, which is recorded by increasing the
recognised daily charter rate by $634 over the remaining tenor of
the time charter party.5. A period time charter of ten years at a
gross daily charter rate of $23,100 for the first two and a half
years and of $24,810 for the remaining period. In January 2017, the
period time charter was amended to reflect substitution of the
initial charterer with its subsidiary guaranteed by the initial
charterer and changes in payment terms; all other charter terms
remained unchanged. The charter agreement grants the charterer an
option to purchase the vessel at any time beginning at the end of
the seventh year of the charter, at a price of $39 million less a
1.00% commission, decreasing thereafter on a pro-rated basis by
$1.5 million per year. The Company holds a right of first refusal
to buy back the vessel in the event that the charterer exercises
its option to purchase the vessel and subsequently offers to sell
such vessel to a third party. The charter agreement also grants the
charterer the option to extend the period time charter for an
additional twelve months at a time at a gross daily charter rate of
$26,330, less 1.25% total commissions, which option may be
exercised by the charterer a maximum of two times.6. Vessel in
dry-docking. 7. MV Kypros Sky and MV Kypros Spirit were sold
and leased back in December 2019 on a bareboat charter basis for a
period of eight years, with purchase options in favour of the
Company commencing three years following the commencement of the
bareboat charter period and a purchase obligation at the end of the
bareboat charter period, all at predetermined purchase prices. 8.
MV Panayiota K and MV Agios Spyridonas were sold and leased back in
January 2020 on a bareboat charter basis for a period of six years,
with purchase options in favour of the Company commencing three
years following the commencement of the bareboat charter period and
a purchase obligation at the end of the bareboat charter period,
all at predetermined purchase prices. 9. MV Zoe, MV Kypros
Land, MV Venus Heritage and MV Venus History were sold and leased
back in November 2019, respectively, on a bareboat charter basis,
one for a period of seven and a half years and three for a period
of eight years, with a purchase option in favour of the Company
five years and nine months following the commencement of the
bareboat charter period at a predetermined purchase price.10.
Scrubber benefit was agreed on the basis of fuel consumption of
heavy fuel oil and the price differential between the heavy fuel
oil and the compliant fuel cost for the voyage and is included on
the daily gross charter rate presented. 11. Scrubber benefit was
agreed on the basis of fuel consumption of heavy fuel oil and the
price differential between the heavy fuel oil and the compliant
fuel cost for the voyage and is not included on the daily gross
charter rate presented. 12. Voyage related to repositioning close
to the shipyard where the vessel would undertake dry docking.
About Safe Bulkers, Inc.
The Company is an international provider of
marine drybulk transportation services, transporting bulk cargoes,
particularly coal, grain and iron ore, along worldwide shipping
routes for some of the world’s largest users of marine drybulk
transportation services. The Company’s common stock, series C
preferred stock and series D preferred stock are listed on the
NYSE, and trade under the symbols “SB”, “SB.PR.C”, and “SB.PR.D”,
respectively.
Forward-Looking Statements
This press release contains forward-looking
statements (as defined in Section 27A of the Securities Exchange
Act of 1934, as amended, and in Section 21E of the Securities Act
of 1933, as amended) concerning future events, the Company’s growth
strategy and measures to implement such strategy, including
expected vessel acquisitions and entering into further time
charters. 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 the expectations
reflected in such forward-looking statements are reasonable, no
assurance can be given 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 that 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, changes in
the demand for drybulk vessels, 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 Securities and Exchange
Commission. The Company expressly disclaims any obligations or
undertaking to release 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:
Company Contact:Dr. Loukas
BarmparisPresidentSafe Bulkers, Inc.Tel.: +30 21 11888400+357 25
887200E-Mail:directors@safebulkers.com
Investor Relations / Media
Contact:Nicolas Bornozis, PresidentCapital Link, Inc.230
Park Avenue, Suite 1536New York, N.Y. 10169Tel.: (212) 661-7566Fax:
(212) 661-7526 E-Mail:safebulkers@capitallink.com
1 Adjusted Net income is a non-GAAP measure. Adjusted Net income
represents Net income before gain/(loss) on derivatives, early
redelivery cost, loss on inventory valuation and gain/(loss) on
foreign currency. See Table 5.
2 EBITDA is a non-GAAP measure and represents Net income plus
net interest expense, tax, depreciation and amortization. See Table
5. Adjusted EBITDA is a non-GAAP measure and represents EBITDA
before gain/(loss) on derivatives, early redelivery cost, loss on
inventory valuation and, gain/(loss) on foreign currency. See Table
5.
3 Earnings per share and Adjusted Earnings per share represent
Net Income and Adjusted Net income less preferred dividend and
mezzanine equity measurement divided by the weighted average number
of shares respectively. See Table 5.
4 Time charter equivalent rate, or TCE rate, represents charter
revenues less commissions and voyage expenses divided by the number
of available days. See Table 6.
5 Daily vessel operating expenses are calculated
by dividing vessel operating expenses for the relevant period by
ownership days for such period. See Table 6.
6 Daily vessel operating expenses excluding
dry-docking and pre-delivery expenses are calculated by dividing
vessel operating expenses excluding dry-docking and pre-delivery
expenses for the relevant period by ownership days for such period.
See Table 6.
7 Daily general and administrative expenses are
calculated by dividing general and administrative expenses for the
relevant period by ownership days for such period. See Table 6.
8 Total Cash represents Cash and cash
equivalents plus Time deposits and Restricted cash.
9 Liquidity represents Total Cash plus
contracted undrawn borrowing capacity under revolving credit
facilities and secured commitments.
10 Total Debt represents Long-term debt plus Current portion of
long-term debt, net of deferred financing costs.
11 Consolidated leverage is a non-GAAP measure and represents
total consolidated liabilities divided by total consolidated
assets. Total consolidated assets are based on the market value of
all vessels, owned or leased on a finance lease taking into account
their employment, and the book value of all other assets. This
measure assists our management and investors by increasing the
comparability of our leverage from period to period.
12 London interbank offered rate.
13 See Table 6.
14 Safety Management Overseas S.A. and Safe Bulkers Management
Limited, each of which is a related party that is referred to in
this press release as “our Manager” and collectively “our
Managers’’.
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