Euroseas Ltd. (NASDAQ: ESEA, the “Company” or “Euroseas”), an owner
and operator of container carrier vessels and provider of seaborne
transportation for containerized cargoes, announced today its
results for the three month period and full year ended December 31,
2019.
Fourth Quarter 2019
Highlights:
- Total net revenues of $13.3
million. Net loss of $0.8 million; net loss attributable to common
shareholders (after a $0.2 million dividend on Series B Preferred
Shares) of $0.9 million or $0.18 loss per share basic and
diluted. Adjusted net loss attributable to common
shareholders1 for the period was $1.6 million or
$0.321 per share basic and diluted.
- Adjusted EBITDA1 was $1.2
million.
- An average of 16.8 vessels were
owned and operated during the fourth quarter of 2019 earning an
average time charter equivalent rate of $9,086 per day.
- During the fourth quarter, the
Company took delivery of four intermediate containerships, owned by
Synergy Holdings Ltd. The consideration for the acquisition of
approximately $40 million was financed by bank debt of $32 million,
existing funds of the Company and $6 million raised in private
placements, subscribed equally by an entity affiliated with the
Company’s CEO and an entity controlled by the seller of the four
vessels. The four vessels, each with a capacity of 4,250 teu,
(three built in 2009 and one in 2008), represent a significant
expansion of Euroseas’ fleet both in terms of units and value.
- Finally, the Company declared its
fourth cash dividend of $0.16 million on its Series B Preferred
Shares.
Full Year 2019 Highlights:
- Total net revenues of $40.0
million. Net loss of $1.7 million; net loss attributable to common
shareholders (after a $1.3 million dividend on Series B Preferred
Shares and a $0.5 million preferred deemed dividend arising out of
the redemption of approximately $11.7 million of Series B Preferred
Shares in the second quarter of 2019) of $3.5 million or
$1.21 loss per share basic and diluted. Adjusted net loss per
share attributable to common shareholders1 for the year was $4.4
million or $1.521 per share basic and diluted.
- Adjusted EBITDA1 was $5.3
million.
- An average of 13.1 vessels were
owned and operated during the twelve months of 2019 earning an
average time charter equivalent rate of $8,782 per day.
1Adjusted EBITDA, Adjusted net loss and Adjusted
loss per share are not recognized measurements under U.S. GAAP
(GAAP) and should not be used in isolation or as a substitute for
Euroseas financial results presented in accordance with GAAP. Refer
to a subsequent section of the Press Release for the definitions
and reconciliation of these measurements to the most directly
comparable financial measures calculated and presented in
accordance with GAAP.
Aristides Pittas, Chairman and CEO of
Euroseas commented: “During the fourth quarter of 2019 and
early 2020, containership time charter rates have held their levels
despite broader concerns about global economic growth and still
existing, although de-escalating, trade tensions between the U.S.
and China. The year registered (on a preliminary basis) one of the
lowest growth rates in the containerized trade. In January 2020,
new uncertainties were introduced in the marketplace by the
coronavirus epidemic and its potential effects on world and
containerized trade growth.
At Euroseas, the fourth quarter of 2019 marked
another quarter of fleet expansion as we acquired 4 vessels on top
of 4 vessels acquired in the third quarter, resulting in a fleet of
19 units. The carrying capacity of our fleet almost doubled over
the last six months. Both of these transactions were examples of us
using our public listing as a platform of consolidation of
additional fleets partly paying for the acquisitions by issuing
stock validating our growth strategy.
Despite the uncertainties in the market place,
our fleet remains fully employed except EM Oinousses that suffered
an engine room fire and is to undergo certain repairs. We believe
that the near term will be shaped by the effects of the coronavirus
epidemic. We are very optimistic for the medium term prospects of
the market due to the very low orderbook, the expected rebounding
of the trade and the further constraints of vessel availability
placed by the installation of scrubbers on a portion of the fleet
to comply with the low sulfur emission regulations. Euroseas’
strategy remains focused on exploiting its position as the only
publicly-listed feeder and small containership-focused company to
continue growing pursuing accretive opportunities via mergers or
combinations with privately owned vessels or fleets.”
Tasos Aslidis, Chief Financial Officer
of Euroseas commented: “The operating results of the
fourth quarter of 2019 reflect the slightly increased levels of
charter rates in the containership markets as compared to the same
period of 2018. On average, during the fourth quarter of 2019, our
vessels earned approximately 5.9% higher time charter equivalent
rates compared to the fourth quarter of 2018.”
“Total daily vessel operating expenses,
including management fees, general and administrative expenses, but
excluding drydocking costs, were higher by 7% during the fourth
quarter of 2019 compared to the same quarter of last year due to
increased expenses for selected vessels as a result of their
trading region as well as the timing of certain expenses, while for
the full year 2019 they were just about 1% higher as compared to
2018. Adjusted EBITDA during the fourth quarter of 2019 remained
unchanged at $1.2 million compared to the fourth quarter of last
year, and it reached $5.3 million versus $4.3 million for the
respective twelve-month periods of 2019 and 2018.”
“As of December 31, 2019, our outstanding debt
(excluding the unamortized loan fees) was $90.2 million, versus
restricted and unrestricted cash of approximately $5.9
million.”
Fourth Quarter 2019 Results:For
the fourth quarter of 2019, the Company reported total net revenues
of $13.3 million representing a 65.9% increase over total net
revenues of $8.0 million during the fourth quarter of 2018. The
Company reported a net loss for the period of $0.8 million and a
net loss attributable to common shareholders of $0.9 million, as
compared to a net loss of $0.5 million and a net loss attributable
to common shareholders of $0.8 million respectively, for the fourth
quarter of 2018. Drydocking expenses amounted to $1.5 million
during the fourth quarter of 2019 comprising the drydocking cost of
one vessel completing her drydocking and two vessels that completed
their intermediate surveys in-water. For the same period of 2018
drydocking expenses amounted to $0.3 million comprising the
drydocking cost of one vessel completing her drydocking that
started within the third quarter of 2018, another vessel that
completed her in water survey and a third vessel that completed her
drydock in 2019. Depreciation expense for the fourth quarter of
2019 increased to $1.5 million from $0.8 million in the fourth
quarter of 2018 due to the increased number of vessels in the
Company’s fleet.
On average, 16.8 vessels were owned and operated
during the fourth quarter of 2019 earning an average time charter
equivalent rate of $9,086 per day compared to 11.0 vessels in the
same period of 2018 earning on average $8,577 per day.
Adjusted EBITDA1 for the fourth quarter of 2019
remained unchanged at $1.2 million compared to the corresponding
period in 2018.
Basic and diluted loss per share attributable to
common shareholders for the fourth quarter of 2019 was $0.18
calculated on 5,036,122 basic and diluted weighted average number
of shares outstanding, compared to basic and diluted loss per share
of $0.53 for the fourth quarter of 2018, calculated on 1,476,918
basic and diluted weighted average number of shares
outstanding.
Excluding the effect on the loss attributable to
common shareholders for the quarter of the unrealized gain on
derivatives and the amortization of below market time charters
acquired, the adjusted loss attributable to common shareholders for
the quarter ended December 31, 2019 would have been $0.32 per share
basic and diluted compared to adjusted loss of $0.55 per share
basic and diluted for the quarter ended December 31, 2018. Usually,
security analysts do not include the above items in their published
estimates of earnings per share.
Full Year 2019 Results:For the
full year of 2019, the Company reported total net revenues of $40.0
million representing a 16.3% increase over total net revenues of
$34.4 million during the twelve months of 2018. The Company
reported a net loss for the year of $1.7 million and a net loss
attributable to common shareholders of $3.5 million, as compared to
net loss of $0.7 million and a net loss attributable to common
shareholders of $2.0 million, respectively, for the twelve months
of 2018. The results for the twelve months of 2019 include $0.9
million of amortization of below market charters acquired and $0.04
million of unrealized gain on derivatives. The results for the
twelve months of 2018 include a $1.3 million gain on sale of a
vessel and $0.2 million of unrealized gain on derivatives.
Depreciation expense for the twelve months of 2019 was $4.2 million
compared to $3.3 million during the same period of 2018 due to the
increased number of vessels in the Company’s fleet.
Interest and other financing costs for the
twelve months of 2019 amounted to $3.8 million compared to $3.1
million for the same period of 2018. This increase is due to the
increased amount of debt in the current period compared to the same
period of 2018. Vessel operating expenses for the same period of
2019 amounted to $24.0 million as compared to $20.0 million for the
same period of 2018. The increased amount is due to the higher
number of vessels owned and operated in the twelve months of 2019
compared to the same period of 2018. Drydocking expenses amounted
to $2.7 million for the twelve months of 2019 (one of our vessels
completed her special survey with drydock, another four vessels
completed their intermediate surveys in-water and a vessel
completed her special survey with drydock that started in 2018),
compared to $2.8 million for the same period of 2018 (three of our
vessels completed their special surveys with drydocks, another
three completed their intermediate surveys in-water and a vessel
started her special survey that completed with drydock in
2019).
On average, 13.1 vessels were owned and operated
during the twelve months of 2019 earning an average time charter
equivalent rate of $8,782 per day compared to 11.49 vessels in the
same period of 2018 earning on average $9,179 per day.
Adjusted EBITDA1 for the twelve months of 2019
was $5.3 million compared to $4.3 million during the twelve months
of 2018.
Basic and diluted loss per share attributable to
common shareholders for the twelve months of 2019 was $1.21,
calculated on 2,861,928 basic and diluted weighted average number
of shares outstanding compared to basic and diluted loss per share
of $1.41 for the twelve months of 2018, calculated on 1,414,775
basic and diluted weighted average number of shares
outstanding.
Excluding the effect on the loss attributable to
common shareholders for the twelve months of 2019 of the unrealized
gain on derivatives and the amortization of the below market time
charters acquired, the adjusted loss per share attributable to
common shareholders for the year ended December 31, 2019 would have
been $1.52 compared to adjusted loss of $2.51 per share basic and
diluted for 2018, which was also adjusted by excluding the gain on
sale of a vessel. As previously mentioned, usually, security
analysts do not include the above items in their published
estimates of earnings per share.
Operating developments:During
January 2020, M/V EM Oinousses experienced an engine room fire
while sailing off Mozambique carrying empty containers. The fire
was extinguished without any injuries to the crew; the vessel is
undergoing evaluation for the type of repairs required. It is
expected for insurance to cover the majority of the costs.
Fleet Profile:
The Euroseas Ltd. fleet profile is as follows:
Name |
Type |
Dwt |
TEU |
Year Built |
Employment(*) |
TCE Rate ($/day) |
Container Carriers |
|
|
|
|
|
|
AKINADA BRIDGE |
Intermediate |
71,366 |
5,610 |
2001 |
TC until Feb-20 |
$16,500 |
SYNERGY BUSAN |
Intermediate |
50,726 |
4,253 |
2009 |
TC until Mar-20 |
$13,250 |
SYNERGY ANTWERP |
Intermediate |
50,726 |
4,253 |
2008 |
TC until May-20 |
CONTEX(**) 4250 less 6.25%; floor $8,000 / ceiling $16,000 |
SYNERGY OAKLAND (***) |
Intermediate |
50,787 |
4,253 |
2009 |
TC until Oct-20 plus 8-12 months extension option |
$9,000 'til Feb-20; $10,000 'til Oct-20; option CONTEX(**) 4250
less 10% |
SYNERGY KEELUNG |
Intermediate |
50,969 |
4,253 |
2009 |
TC until Dec-20/Jun-22 plus 8- 12 months option |
$10,000 'til Jun-21; $11,750 'til Jun-22; option $14,500 |
EM KEA |
Feeder |
42,165 |
3,100 |
2007 |
TC until Mar-20 |
$9,700 |
EM ASTORIA |
Feeder |
35,600 |
2,788 |
2004 |
TC until Mar-20 |
$8,500 |
EVRIDIKI G |
Feeder |
34,677 |
2,556 |
2001 |
TC until Sep-20 |
$10,250 |
EM CORFU |
Feeder |
34,654 |
2,556 |
2001 |
TC until Sep-21 |
$10,200 |
EM ATHENS |
Feeder |
32,350 |
2,506 |
2000 |
TC until Oct-20 |
$9,250 |
EM OINOUSSES |
Feeder |
32,350 |
2,506 |
2000 |
Undergoing repairs |
|
DIAMANTIS P |
Feeder |
30,360 |
2,008 |
1998 |
TC until Jul-20 |
$8,000 |
EM SPETSES |
Feeder |
23,224 |
1,740 |
2007 |
TC until Mar-20 |
$7,000 |
EM HYDRA |
Feeder |
23,351 |
1,740 |
2005 |
TC until Mar-20 |
$7,500 |
JOANNA |
Feeder |
22,301 |
1,732 |
1999 |
TC until Feb-21 |
$8,050 |
MANOLIS P |
Feeder |
20,346 |
1,452 |
1995 |
TC until Mar-20 |
$6,800 |
AEGEAN EXPRESS |
Feeder |
18,581 |
1,439 |
1997 |
TC until Mar-20 |
$7,500 |
KUO HSIUNG |
Feeder |
18,154 |
1,169 |
1993 |
TC until Mar-20 |
$7,500 |
NINOS |
Feeder |
18,253 |
1,169 |
1990 |
TC until Mar-20 |
$7,750 |
Total Container
Carriers |
19 |
660,940 |
51,083 |
|
|
|
Note: (*) Charter duration indicates the
earliest redelivery date unless the contract rate is lower than the
current market rate in which cases the latest redelivery date is
assumed; vessels with the latest redelivery date shown are marked
by (***)(**)The CONTEX (Container Ship Time Charter Assessment
Index) has been published by the Hamburg and Bremen Shipbrokers’
Association (VHBS) since October 2007. The CONTEX is a
company-independent index of time charter rates for container
ships. It is based on assessments of the current day charter rates
of six selected container ship types, which are representative of
their size categories: Type 1,100 TEU and Type 1,700 TEU with a
charter period of one year, and the Types 2,500, 2,700, 3,500 and
4,250 TEU all with a charter period of two years.
Summary Fleet Data:
|
ThreeMonths,Ended December
31,2018 |
|
ThreeMonths,EndedDecember
31,2019 |
|
TwelveMonths,EndedDecember
31,2018 |
|
TwelveMonths,EndedDecember
31,2019 |
|
FLEET DATA |
|
|
|
|
Average number of vessels (1) |
11.00 |
|
16.84 |
|
11.49 |
|
13.1 |
|
Calendar days for fleet (2) |
1,012.0 |
|
1,549.0 |
|
4,191.0 |
|
4,782.0 |
|
Scheduled off-hire days incl. laid-up (3) |
7.6 |
|
59.5 |
|
76.5 |
|
102.3 |
|
Available days for fleet (4) = (2) - (3) |
1,004.4 |
|
1,489.5 |
|
4,114.5 |
|
4,679.7 |
|
Commercial off-hire days (5) |
92.1 |
|
- |
|
137.8 |
|
38.4 |
|
Operational off-hire days (6) |
1.4 |
|
3.8 |
|
162.7 |
|
5.1 |
|
Voyage days for fleet (7) = (4) - (5) - (6) |
910.9 |
|
1,485.7 |
|
3,814.0 |
|
4,636.2 |
|
Fleet utilization (8) = (7) / (4) |
90.7% |
|
99.7% |
|
92.7% |
|
99.1% |
|
Fleet utilization, commercial (9) = ((4) - (5)) / (4) |
90.8% |
|
100.0% |
|
96.7% |
|
99.2% |
|
Fleet utilization, operational (10) = ((4) - (6)) / (4) |
99.9% |
|
99.7% |
|
96.0% |
|
99.9% |
|
|
|
|
|
|
AVERAGE DAILY RESULTS |
|
|
|
|
Time charter equivalent rate (11) |
8,577 |
|
9,086 |
|
9,179 |
|
8,782 |
|
Vessel operating expenses excl. drydocking expenses (12) |
5,275 |
|
5,839 |
|
5,613 |
|
5,783 |
|
General and administrative expenses (13) |
507 |
|
343 |
|
612 |
|
511 |
|
Total vessel operating expenses (14) |
5,782 |
|
6,182 |
|
6,225 |
|
6.294 |
|
Drydocking expenses (15) |
332 |
|
990 |
|
662 |
|
568 |
|
(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 calendar days each
vessel was a part of the Company’s fleet during the period divided
by the number of calendar days in that period.
(2) Calendar days. We define calendar days as
the total number of days in a period during which each vessel in
our fleet was in our possession including off-hire days associated
with major repairs, drydockings or special or intermediate surveys
or days of vessels in lay-up. Calendar days are an indicator of the
size of our fleet over a period and affect both the amount of
revenues and the amount of expenses that we record during that
period.
(3) The scheduled off-hire days including
vessels laid-up are days associated with scheduled repairs,
drydockings or special or intermediate surveys or days of vessels
in lay-up.
(4) Available days. We define available days as
the total number of days in a period during which each vessel in
our fleet was in our possession net of scheduled off-hire days
including laid up. We use available days to measure the number of
days in a period during which vessels were available to generate
revenues.
(5) Commercial off-hire days. We define
commercial off-hire days as days a vessel is idle without
employment.
(6) Operational off-hire days. We define
operational off-hire days as days associated with unscheduled
repairs or other off-hire time related to the operation of the
vessels.
(7) Voyage days. We define voyage days as the
total number of days in a period during which each vessel in our
fleet was in our possession net of commercial and operational
off-hire days. We use voyage days to measure the number of days in
a period during which vessels actually generate revenues or are
sailing for repositioning purposes.
(8) Fleet utilization. We calculate fleet
utilization by dividing the number of our voyage days during a
period by the number of our available days during that period. We
use fleet utilization to measure a company’s efficiency in finding
suitable employment for its vessels and minimizing the amount of
days that its vessels are off-hire for reasons such as unscheduled
repairs or days waiting to find employment.
(9) Fleet utilization, commercial. We calculate
commercial fleet utilization by dividing our available days net of
commercial off-hire days during a period by our available days
during that period.
(10) Fleet utilization, operational. We
calculate operational fleet utilization by dividing our available
days net of operational off-hire days during a period by our
available days during that period.
(11) Time charter equivalent, or TCE, is a
measure of the average daily revenue performance of our vessels.
Our method of calculating TCE is determined by dividing time
charter revenue and voyage charter revenue net of voyage expenses
by voyage days for the relevant time period. Voyage expenses
primarily consist of port, canal and fuel costs that are unique to
a particular voyage, which would otherwise be paid by the charterer
under a time charter contract, or are related to repositioning the
vessel for the next charter. TCE 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., spot voyage charters, time charters and
bareboat charters) under which the vessels may be employed between
the periods. Our definition of TCE may not be comparable to that
used by other companies in the shipping industry.
(12) Daily vessel operating expenses, which
includes crew costs, provisions, deck and engine stores,
lubricating oil, insurance, maintenance and repairs and management
fees are calculated by dividing vessel operating expenses by fleet
calendar days for the relevant time period. Drydocking expenses are
reported separately.
(13) Daily general and administrative expense is
calculated by dividing general and administrative expenses by fleet
calendar days for the relevant time period.
(14) Total vessel operating expenses, or TVOE,
is a measure of our total expenses associated with operating our
vessels. TVOE is the sum of vessel operating expenses, management
fees and general and administrative expenses; drydocking expenses
are not included. Daily TVOE is calculated by dividing TVOE by
fleet calendar days for the relevant time period.
(15) Drydocking expenses include expenses during
drydockings that would have been capitalized and amortized under
the deferral method, divided by the fleet calendar days for the
relevant period. Drydocking expenses could vary substantially from
period to period depending on how many vessels underwent drydocking
during the period. The Company expenses drydocking expenses as
incurred.
Conference Call and
Webcast:Today, Wednesday, February 19, 2020 at 11:00 a.m.
Eastern Time, the Company's management will host a conference call
to discuss the results.
Conference Call details:
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
"Euroseas" to the operator.
A telephonic replay of the conference call will
be available until February 26, 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) and the access
code required for the replay is: 6973591#.
Audio Webcast - Slides
Presentation: There will be a live and then archived audio
webcast of the conference call, via the internet through the
Euroseas website (www.euroseas.gr). Participants to the live
webcast should register on the website approximately 10 minutes
prior to the start of the webcast.
A slide presentation on the Fourth Quarter 2019
results will also be available in PDF format 10 minutes prior to
the conference call and webcast, accessible on the Company's
website (www.euroseas.gr) on the webcast page. Participants to the
webcast can download the PDF presentation.
Euroseas Ltd. Unaudited
Consolidated Condensed Statements of
Operations(All amounts expressed in U.S. Dollars –
except number of shares)
|
|
Three MonthsEnded December 31, |
Three MonthsEnded December 31, |
Twelve MonthsEnded December 31, |
Twelve MonthsEnded December 31, |
|
|
2018 |
2019 |
2018 |
2019 |
|
|
|
|
|
|
Revenues |
|
|
|
|
|
Time charter revenue |
|
8,246,117 |
|
13,816,475 |
|
36,062,202 |
|
41,769,278 |
|
Voyage charter revenue |
|
188,207 |
|
- |
|
206,682 |
|
- |
|
Commissions |
|
(415,882) |
|
(510,871) |
|
(1,844,147) |
|
(1,745,599) |
|
|
|
|
|
|
|
|
|
|
|
Net revenues, continuingoperations |
|
8,018,442 |
|
13,305,604 |
|
34,424,737 |
|
40,023,679 |
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
Voyage expenses |
|
621,560 |
|
317,456 |
|
1,261,088 |
|
1,055,408 |
|
Vessel operating expenses |
|
4,540,426 |
|
7,868,953 |
|
19,986,170 |
|
23,983,282 |
|
Drydocking expenses |
|
336,352 |
|
1,533,048 |
|
2,774,924 |
|
2,714,662 |
|
Vessel depreciation |
|
798,712 |
|
1,491,336 |
|
3,305,951 |
|
4,178,886 |
|
Related party management fees |
|
797,456 |
|
1,175,265 |
|
3,536,094 |
|
3,671,335 |
|
Gain on sale of vessel |
|
- |
|
- |
|
(1,340,952) |
|
- |
|
General and administrative expenses |
|
513,244 |
|
530,731 |
|
2,565,502 |
|
2,444,495 |
|
Total operating expenses,
continuingoperations |
|
7,607,750 |
|
12,916,789 |
|
32,088,777 |
|
38,048,068 |
|
|
|
|
|
|
|
Operating income, continuingoperations |
|
410,692 |
|
388,815 |
|
2,335,960 |
|
1,975,611 |
|
|
|
|
|
|
|
Other income/(expenses) |
|
|
|
|
|
Interest and other financing costs |
|
(988,040) |
|
(1,152,788) |
|
(3,050,768) |
|
(3,424,969) |
|
Loss on debt extinguishment |
|
- |
|
- |
|
- |
|
(328,291) |
|
Gain / (loss) on derivatives, net |
|
1,031 |
|
- |
|
(44,343) |
|
(2,885) |
|
Foreign exchange gain/(loss) |
|
17,225 |
|
(5,851) |
|
13,963 |
|
2,024 |
|
Interest income |
|
21,647 |
|
4,698 |
|
81,792 |
|
95,839 |
|
Other expenses, net, continuing
operations |
|
(948,137) |
|
(1,153,941) |
|
(2,999,356) |
|
(3,658,282) |
|
Net loss, continuing
operations |
|
(537,445) |
|
(765,126) |
|
(663,396) |
|
(1,682,671) |
|
Dividend Series B Preferred shares |
|
(244,031) |
|
(161,315) |
|
(1,335,733) |
|
(1,271,782) |
|
Preferred deemed dividend |
|
- |
|
- |
|
- |
|
(504,577) |
|
Net loss attributable to common shareholders, continuing
operations |
|
(781,476) |
|
(926,441) |
|
(1,999,129) |
|
(3,459,030) |
|
Net loss attributable to common shareholders, discontinued
operations |
|
560,098 |
|
- |
|
554,506 |
|
- |
|
Net loss attributable to common shareholders |
|
(221,378) |
|
(926,441) |
|
(1,444,623) |
|
(3,459,030) |
|
Weighted average number of shares outstanding, basic and
diluted |
|
1,476,918 |
|
5,036,122 |
|
1,414,775 |
|
2,861,928 |
|
Loss per share attributable to common shareholders - basic and
diluted, continuing operations |
|
(0.53) |
|
(0.18) |
|
(1.41) |
|
(1.21) |
|
Loss per share attributable to common shareholders - basic and
diluted, discontinued operations |
|
0.38 |
|
- |
|
0.39 |
|
- |
|
Loss per share attributable to common shareholders - basic and
diluted |
|
(0.15) |
|
(0.18) |
|
(1.02) |
|
(1.21) |
|
|
|
|
|
|
|
|
|
|
|
Euroseas Ltd., Unaudited
Consolidated Condensed Balance Sheets(All amounts
expressed in U.S. Dollars – except number of shares)
|
December 31,2018 |
|
December 31,2019 |
|
|
|
|
|
|
ASSETS |
(unaudited) |
Current
Assets: |
|
|
Cash and cash equivalents |
6,960,258 |
|
985,418 |
|
Trade accounts receivable, net |
958,705 |
|
715,097 |
|
Other receivables |
2,031,415 |
|
1,570,506 |
|
Inventories |
1,704,391 |
|
1,889,164 |
|
Restricted cash |
117,063 |
|
610,376 |
|
Prepaid expenses |
222,336 |
|
526,531 |
|
Total current
assets |
11,994,168 |
|
6,297,092 |
|
|
|
|
Fixed
assets: |
|
|
Vessels, net |
48,826,128 |
|
116,230,333 |
|
Long-term
assets: |
|
|
Restricted cash |
6,134,267 |
|
4,334,267 |
|
Total
assets |
66,954,563 |
|
126,861,692 |
|
|
|
|
LIABILITIES,MEZZANINE
EQUITY AND SHAREHOLDERS’ EQUITY |
|
|
Current
liabilities: |
|
|
Long-term bank loans, current portion |
4,870,241 |
|
12,295,320 |
|
Related party loan, current |
- |
|
5,000,000 |
|
Trade accounts payable |
2,288,525 |
|
3,899,967 |
|
Accrued expenses |
1,301,805 |
|
1,725,322 |
|
Accrued preferred dividends |
- |
|
161,315 |
|
Deferred revenue |
417,634 |
|
973,774 |
|
Derivatives |
41,435 |
|
- |
|
Due to related company |
2,672,895 |
|
795,562 |
|
Total current
liabilities |
11,592,535 |
|
24,851,260 |
|
|
|
|
Long-term
liabilities: |
|
|
Long -term bank loans, net of current portion |
31,716,549 |
|
72,187,785 |
|
Vessel profit participation liability |
1,067,500 |
|
- |
|
Fair value of below market time charters acquired |
- |
|
1,714,370 |
|
Total long term
liabilities |
32,784,049 |
|
73,902,155 |
|
Total
liabilities |
44,376,584 |
|
98,753,415 |
|
|
|
|
Mezzanine
equity: |
|
|
Series B Preferred shares (par value $0.01, 20,000,000 shares
authorized, 19,605 and 8,000 issued and outstanding,
respectively) |
18,757,361 |
|
7,654,577 |
|
Shareholders’
equity: |
|
|
Common stock (par value $0.03, 200,000,000 shares authorized,
1,564,456 and 5,600,259 issued and outstanding) |
46,934 |
|
168,008 |
|
Additional paid-in capital |
233,996,669 |
|
253,967,708 |
|
Accumulated deficit |
(230,222,985 |
) |
(233,682,016 |
) |
Total shareholders’
equity |
3,820,618 |
|
20,453,700 |
|
Total liabilities,
mezzanine equity and shareholders' equity |
66,954,563 |
|
126,861,692 |
|
|
|
|
Euroseas Ltd. Unaudited
Consolidated Condensed Statements of Cash
Flows (All amounts expressed in U.S.
Dollars)
|
Twelve MonthsEndedDecember 31, |
|
Twelve MonthsEndedDecember 31, |
|
|
2018 |
|
2019 |
|
|
|
|
Cash flows from operating activities: |
|
Net loss, continuing operations |
(663,396) |
|
(1,682,671) |
|
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
Vessel depreciation |
3,305,951 |
|
4,178,886 |
|
Amortization and write off of deferred charges |
321,181 |
|
205,590 |
|
Share-based compensation |
124,487 |
|
97,919 |
|
Gain on sale of vessel |
(1,340,952) |
|
- |
|
Amortization of fair value of below market time charters
acquired |
- |
|
(857,945) |
|
Unrealized gain on derivatives |
(204,647) |
|
(41,435) |
|
Amortization of debt discount |
465,507 |
|
95,214 |
|
Loss on debt extinguishment |
- |
|
328,291 |
|
Changes in operating assets and liabilities |
(3,482,961) |
|
816,580 |
|
Net cash used in / (provided by) operating
activities of continuing operations |
(1,474,830) |
|
3,140,429 |
|
|
|
|
Cash flows from investing activities: |
|
|
Cash paid for acquisition of vessels and capitalized expenses |
(1,867) |
|
(55,720,226) |
|
Proceeds from sale of vessels |
6,255,735 |
|
- |
|
Net cash provided by / (used in) investing
activities of continuing operations |
6,253,868 |
|
(55,720,226) |
|
|
|
|
Cash flows from financing activities: |
|
|
Redemption of Series B preferred shares |
- |
|
(11,686,000) |
|
Proceeds from issuance of common stock, net of commissions
paid |
1,975,110 |
|
6,853,101 |
|
Investment in subsidiary spun-off |
(3,298,356) |
|
- |
|
Preferred dividends paid |
- |
|
(1,031,827) |
|
Loan arrangement fees paid |
(419,863) |
|
(566,500) |
|
Offering expenses paid |
(22,488) |
|
(36,724) |
|
Proceeds from long- term bank loans |
34,250,000 |
|
60,167,680 |
|
Proceeds from related party loan |
- |
|
5,000,000 |
|
Repayment of long-term bank loans and vessel profit participation
liability |
(32,349,000) |
|
(13,401,460) |
|
Net cash provided by financing activities of
continuing operations |
135,403 |
|
45,298,270 |
|
|
|
|
Net increase / (decrease) in cash, cash equivalents and restricted
cash |
4,914,441 |
|
(7,281,527) |
|
Cash, cash equivalents and restricted cash at beginning of
year |
8,297,147 |
|
13,211,588 |
|
Cash, cash equivalents and restricted cash at end of year,
continuing operations |
13,211,588 |
|
5,930,061 |
|
Cash breakdown
Cash and cash equivalents |
6,960,258 |
|
985,418 |
|
Restricted cash, current |
117,063 |
|
610,376 |
|
Restricted cash, long term |
6,134,267 |
|
4,334,267 |
|
Total cash, cash equivalents and restricted cash shown in
the statement of cash flows, continuing operations |
13,211,588 |
|
5,930,061 |
|
|
|
|
|
Discontinued operations: |
|
|
|
Net cash provided by operating activities of discontinued
operations |
3,970,170 |
|
- |
|
Net cash used in investing activities of discontinued
operations |
(29,045,685) |
|
- |
|
Net cash provided by financing activities of discontinued
operations |
27,928,885 |
|
- |
|
Supplemental cash flow information |
|
|
|
|
Non-cash financing and investing activities
fees: |
|
|
|
|
Paid in-kind dividends |
1,091,701 |
|
78,640 |
|
Capital expenditures included in liabilities |
- |
|
160,907 |
|
Shares issued as consideration for acquisition of vessels |
- |
|
13,218,662 |
|
Preferred shares distributed to EuroDry |
18,192,131 |
|
- |
|
|
|
|
|
|
Euroseas Ltd.
Reconciliation of Adjusted EBITDA to Net
loss(All amounts expressed in U.S.
Dollars)
|
Three MonthsEndedDecember
31,2018 |
Three MonthsEndedDecember
31,2019 |
Twelve MonthsEndedDecember
31,2018 |
Twelve MonthsEndedDecember
31,2019 |
Net loss |
(537,445) |
|
(765,126) |
|
(663,396) |
|
(1,682,671) |
|
Interest and other financing costs, net (incl. interest income and
loss on debt extinguishment) |
966,393 |
|
1,148,090 |
|
2,968,976 |
|
3,657,421 |
|
Vessel depreciation |
798,712 |
|
1,491,336 |
|
3,305,950 |
|
4,178,886 |
|
Gain on sale of vessel |
- |
|
- |
|
(1,340,952) |
|
- |
|
Amortization of below market time charters acquired |
- |
|
(672,995) |
|
- |
|
(857,945) |
|
(Gain) / loss on interest rate swap derivatives, net |
(1,031) |
|
- |
|
44,343 |
|
2,885 |
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
1,226,629 |
|
1,201,305 |
|
4,314,921 |
|
5,298,576 |
|
Adjusted EBITDA
Reconciliation:Euroseas Ltd. considers Adjusted EBITDA to
represent net loss before interest, income taxes, depreciation,
loss on interest rate swaps and amortization of below market time
charters acquired. Adjusted EBITDA does not represent and
should not be considered as an alternative to net loss, as
determined by United States generally accepted accounting
principles, or GAAP. Adjusted EBITDA is included herein because it
is a basis upon which the Company assesses its financial
performance and we believe that this non- GAAP financial measure
assists our management and investors by increasing the
comparability of our performance from period to period by excluding
the potentially disparate effects between periods of, financial
costs, amortization of below market time charters acquired and
(gain) / loss on interest rate swaps, and depreciation. The
Company's definition of Adjusted EBITDA may not be the same as that
used by other companies in the shipping or other
industries.
Euroseas Ltd.
Reconciliation of Net loss to Adjusted net
loss(All amounts expressed in U.S. Dollars –
except share data and number of shares)
|
Three MonthsEndedDecember
31,2018 |
Three MonthsEndedDecember
31,2019 |
Twelve
MonthsEndedDecember
31,2018 |
Twelve MonthsEndedDecember
31,2019 |
Net loss |
(537,445) |
|
(765,126) |
|
(663,396) |
|
(1,682,671) |
|
Unrealized gain on derivatives |
(32,685) |
|
- |
|
(204,647) |
|
(41,435) |
|
Gain on sale of vessel |
- |
|
- |
|
(1,340,952) |
|
- |
|
Amortization of below market time charters acquired |
- |
|
(672,995) |
|
- |
|
(857,945) |
|
Adjusted net loss |
(570,130) |
|
(1,438,121) |
|
(2,208,995) |
|
(2,582,051) |
|
Preferred dividends |
(244,031) |
|
(161,315) |
|
(1,335,733) |
|
(1,271,782) |
|
Preferred deemed dividend |
- |
|
- |
|
- |
|
(504,577) |
|
|
|
|
|
|
|
|
|
|
Adjusted net loss attributable to common
shareholders |
(814,161) |
|
(1,599,436) |
|
(3,544,728) |
|
(4,358,410) |
|
|
|
|
|
|
|
|
|
|
Adjusted loss per share, basic and diluted |
(0.55) |
|
(0.32) |
|
(2.51) |
|
(1.52) |
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares, basic and diluted |
1,476,918 |
|
5,036,122 |
|
1,414,775 |
|
2,861,928 |
|
Adjusted net loss and Adjusted net loss
per share Reconciliation:Euroseas Ltd. considers Adjusted
net loss to represent net loss before unrealized gain on
derivative, gain on sale of vessel and amortization of below market
time charters acquired. Adjusted net loss and Adjusted loss per
share is included herein because we believe it assists our
management and investors by increasing the comparability of the
Company's fundamental performance from period to period by
excluding the potentially disparate effects between periods of
unrealized gain on derivative, gain on sale of vessel and
amortization of below market time charters acquired, which items
may significantly affect results of operations between
periods.
Adjusted net loss and Adjusted loss per share do
not represent and should not be considered as an alternative to net
loss or loss per share, as determined by GAAP. The Company's
definition of Adjusted net loss and Adjusted loss per share may not
be the same as that used by other companies in the shipping or
other industries.
About Euroseas Ltd.Euroseas
Ltd. was formed on May 5, 2005 under the laws of the Republic of
the Marshall Islands to consolidate the ship owning interests of
the Pittas family of Athens, Greece, which has been in the shipping
business over the past 140 years. Euroseas trades on the NASDAQ
Capital Market under the ticker ESEA.
Euroseas operates in the container shipping
market. Euroseas' operations are managed by Eurobulk Ltd., an ISO
9001:2008 and ISO 14001:2004 certified affiliated ship management
company, which is responsible for the day-to-day commercial and
technical management and operations of the vessels. Euroseas
employs its vessels on spot and period charters and through pool
arrangements.
The Company has a fleet of 19 vessels, including
14 Feeder containerships and 5 Intermediate Container carriers.
Euroseas 19 containerships have a cargo capacity of 51,083 teu.
Forward Looking StatementThis
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; 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 containerships, 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 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.
Visit our website www.euroseas.gr
Company Contact |
Investor Relations / Financial Media |
Tasos AslidisChief Financial OfficerEuroseas Ltd.11 Canterbury
Lane,Watchung, NJ 07069Tel. (908) 301-9091E-mail:
aha@euroseas.gr |
Nicolas BornozisPresidentCapital Link, Inc.230 Park Avenue, Suite
1536New York, NY 10169Tel. (212) 661-7566E-mail:
euroseas@capitallink.com |
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