Global Ship Lease, Inc. (NYSE: GSL) (the “Company”, “Global Ship
Lease” or “GSL”), an owner of containerships, announced today its
unaudited results for the three and six month periods ended June
30, 2023.
Second Quarter 2023 and Year to Date
Highlights
- Reported operating revenue of $162.1 million
for the second quarter 2023, up 4.9% from $154.5 million for the
prior year period. For the six months ended June 30, 2023,
operating revenue was $321.4 million, up 4.3% from $308.1 million
in first half 2022.
- Reported net income available to common
shareholders of $75.4 million for the second quarter of 2023, an
increase of 41.2% on net income of $53.4 million for the prior year
period. Normalized net income (a non-U.S. GAAP financial measure,
described below) for the same period was $74.0 million, up 11.8% on
Normalized net income of $66.2 million for the prior year period.
For the six months ended June 30, 2023, net income available to
common shareholders was $147.6 million, an increase of 21.8% on net
income of $121.2 million for the prior year period. Normalized net
income for the same period was $149.5 million, up 12.0% on
Normalized net income for the prior year period of $133.5
million.
- Generated $108.2 million of Adjusted EBITDA (a
non-U.S. GAAP financial measure, described below) for the second
quarter of 2023, up 12.0% on Adjusted EBITDA of $96.6 million for
the prior year period. Adjusted EBITDA for the six months ended
June 30, 2023 was $213.1 million, up 14.0% on Adjusted EBITDA of
$187.0 million for the prior year period.
- Earnings per share for the three months ended
June 30, 2023 was $2.13, up 44.9% on the earnings per share of
$1.47 for the prior year period. Normalized earnings per share for
the three months ended June 30, 2023 was $2.09, up 14.8% on the
Normalized earnings per share of $1.82 for the prior year period.
Earnings per share for the six months ended June 30, 2023 was
$4.15, up 25.4% on the earnings per share of $3.31 for the prior
year period. Normalized earnings per share for the six months ended
June 30, 2023 was $4.21, up 15.3% on the Normalized earnings per
share of $3.65 for the prior year period.
- Declared a dividend of $0.375 per Class A
common share for the second quarter of 2023 to be paid on September
4, 2023 to common shareholders of record as of August 23, 2023.
Paid a dividend of $0.375 per Class A common share for the first
quarter of 2023 on June 2, 2023.
- On May 8, 2023, announced an agreement to
purchase four 8,544 TEU vessels for an aggregate purchase price
of $123.3 million. All vessels were delivered during the
second quarter of 2023 and are chartered to a leading liner
operator for a minimum firm period of 24 months, followed by a
12-month extension at the charterer’s option. The purchase price
was financed by a new credit facility for a total of $76.0 million
and cash on hand. The credit facility is priced at SOFR + 3.50%,
with SOFR fully covered by the Company’s pre-existing interest rate
cap at 0.64%.
- On June 20, 2023, announced updates from three
leading credit rating agencies. The Company’s Corporate Family
Rating has been upgraded to Ba3 from B1, with a stable outlook, by
Moody’s Investor Service. In addition, S&P Global Ratings
revised the Company’s outlook to positive and affirmed its
long-term issued credit rating at ‘BB’, and the Kroll Bond Rating
Agency affirmed both the Company’s BB corporate rating with a
stable outlook, as well as the BBB/stable investment grade rating
and outlook for the $350.0 million 5.69% Senior Secured Notes due
2027.
- Between January 1, 2023, and June 30, 2023,
added $211.9 million of firm contracted revenues to forward charter
cover, calculated on the basis of the median firm periods of the
respective charters. For vessels in our pre-existing fleet, new
charter fixtures or extensions were agreed on eight ships between
2,200 and 3,500 TEU, charter extensions were exercised for two
7,800 TEU ships, a forward fixture was agreed for one ECO 9,100 TEU
ship, and four 8,544 TEU vessels were purchased with charters
attached; firm charter terms range from a few months to two
years.
- Continued to utilize the $40.0 million
authorization (the “Buy-back Authorization”) for opportunistic
share repurchases, repurchasing a total of 582,178 Class A common
shares during January 2023 for a total investment of $10.0 million.
During second quarter of 2023 a further 385,064 Class A common
shares were purchased for an investment of $7.0 million.
Re-purchase prices in 2023 ranged between $16.12 and $18.69 per
common share, with an average price of $17.56. A total of 2,027,882
Class A common shares have been repurchased under the Buy-back
Authorization, for approximately $37.0 million. The Board has
authorized a further $40.0 million for such share repurchases for a
total of approximately $43.0 million of authorization capacity
remaining.
George Youroukos, Executive Chairman of Global
Ship Lease, stated: “In the second quarter, GSL continued to
benefit from our strong contract cover at attractive rates, even as
prevailing market charter rates and vessel values normalize.
Chartering activity in the market has remained modest by historical
standards, with limited capacity coming available outside the
feeder segment, and idle capacity at quarter-end hovering around
1%. While this limited liquidity and the current macroeconomic
uncertainty make it difficult to predict the market over the
quarters ahead, charters agreed in the second quarter have shown
some stability at rates that compare favorably to those that
prevailed before the COVID-driven rate spike of 2021 and 2022.
Mid-sized and smaller vessels such as those that make up the GSL
fleet form the backbone of liner companies’ global networks, and we
remain in active discussions with liners on additional
opportunities to expand our current forward charter cover of $1.97
billion over 2.3 years, with only a limited number of open days
through the end of 2024.
“Set against the backdrop of reduced asset
prices for the high-specification, workhorse vessels that make up
our fleet, we were able to utilize our strong balance sheet to
purchase, finance on competitive terms, and take delivery of four
post-panamax containerships with attractive charters attached; our
first vessel acquisitions since before the period of sharply
elevated asset values. Should current trends be sustained, we
expect to see an increased number of potential purchase
opportunities come into the market over time. We intend to maintain
the disciplined and risk-averse approach to acquisitions that has
served GSL well, focusing on secondhand containerships with cash
flow visibility, attractive upside potential, and limited downside
risk. Our strong balance sheet and contracted cash flows provide us
with a strong platform from which to selectively pursue
value-accretive growth opportunities, while also supporting our
attractive dividend and active share buy-back program.”
Ian Webber, Chief Executive Officer, commented:
“As evidenced by the recent upgrades and supportive commentary from
the credit ratings agencies, our efforts to deleverage, reduce our
cost of debt, and increase our overall financial strength and
resilience have borne fruit, both in terms of our credit profile
and our core business as a containership owner and lessor. Our
recent acquisitions have reinforced these positive trends, as we
raised debt at a margin of just 3.50%, and made use of the headroom
under our existing 0.64% SOFR interest rate cap to conclude our
recent vessel acquisitions at a highly competitive cost of capital.
With long-term visibility on our contracted cash flows, a
diversified portfolio of financially strong counterparties,
floating interest rate exposure fully capped, and our proven
ability to identify and execute accretive transactions, we remain
well positioned to continue creating value for our shareholders
through our disciplined and dynamic allocation of capital,
including the use of the recently authorized additional $40 million
of share buy-back capacity.”
SELECTED FINANCIAL DATA – UNAUDITED
(thousands of U.S. dollars)
|
|
Three |
Three |
Six |
Six |
| |
months ended |
months ended |
months ended |
months ended |
| |
June 30, 2023 |
June 30, 2022 |
June 30, 2023 |
June 30, 2022 |
| |
|
|
|
|
| Operating Revenue
(1) |
162,080 |
154,456 |
321,371 |
308,087 |
| Operating Income |
85,109 |
83,586 |
170,207 |
167,326 |
| Net Income
(2) |
75,392 |
53,351 |
147,612 |
121,157 |
| Adjusted EBITDA
(3) |
108,166 |
96,579 |
213,072 |
186,959 |
| Normalized Net Income
(3) |
73,975 |
66,186 |
149,539 |
133,479 |
(1) Operating Revenue is net of address
commissions which represent a discount provided directly to a
charterer based on a fixed percentage of the agreed upon charter
rate and also includes the amortization of intangible liabilities
and the effect of the straight lining of time charter
modifications. Brokerage commissions are included in “Time charter
and voyage expenses” (see below).
(2) Net Income available to common
shareholders.
(3) Adjusted EBITDA and Normalized Net Income
are non-U.S. Generally Accepted Accounting Principles (“U.S. GAAP”)
financial measures, as explained further in this press release, and
are considered by Global Ship Lease to be a useful measure of its
performance. For reconciliations of these non-U.S. GAAP financial
measures to net income, the most directly comparable U.S. GAAP
financial measure, please see “Reconciliation of Non-U.S. GAAP
Financial Measures” below.
Operating Revenue and Utilization
Operating revenue derived from fixed-rate,
mainly long-term, time-charters was $162.1 million in the three
months ended June 30, 2023, up $7.6 million (or 4.9%) on operating
revenue of $154.5 million for the prior year period. The
period-on-period increase in operating revenue was principally due
to (i) charter renewals at higher rates on a number of vessels and
(ii) the acquisition of the four new vessels which were delivered
in the second quarter. The increase was partially offset by $8.9
million reduction in the amortization of intangible liabilities
arising on below-market charters attached to certain vessel
additions. There were 328 days of offhire in the second quarter of
2023 of which 236 were for scheduled drydockings, compared to 266
days of offhire in the prior year period of which 82 were for
scheduled drydockings. Utilization for the second quarter of 2023
was 94.5% compared to utilization of 95.5% in the same period of
the prior year.
For the six months ended June 30, 2023,
operating revenue was $321.4 million, up $13.3 million (or 4.3%) on
operating revenue of $308.1 million in the comparative period,
mainly due to the factors noted above.
The table below shows fleet utilization for the
three and six months ended June 30, 2023 and 2022, and for the
years ended December 31, 2022, 2021, 2020 and 2019.
| |
Three months ended |
|
Six months ended |
|
Year ended |
|
|
June 30, |
|
June 30, |
|
|
June 30, |
|
June 30, |
|
|
Dec 31, |
|
Dec 31, |
|
Dec 31, |
|
Dec 31, |
|
|
Days |
2023 |
|
2022 |
|
|
2023 |
|
2022 |
|
|
2022 |
|
2021 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ownership days |
5,930 |
|
5,915 |
|
|
11,773 |
|
11,765 |
|
|
23,725 |
|
19,427 |
|
16,044 |
|
14,326 |
|
| Planned offhire - scheduled
drydock |
(236 |
) |
(82 |
) |
|
(436 |
) |
(309 |
) |
|
(581 |
) |
(752 |
) |
(687 |
) |
(537 |
) |
| Unplanned offhire |
(72 |
) |
(154 |
) |
|
(174 |
) |
(236 |
) |
|
(460 |
) |
(260 |
) |
(95 |
) |
(105 |
) |
| Idle time |
(20 |
) |
(30 |
) |
|
(20 |
) |
(30 |
) |
|
(30 |
) |
(88 |
) |
(338 |
) |
(164 |
) |
| Operating days |
5,602 |
|
5,649 |
|
|
11,143 |
|
11,190 |
|
|
22,654 |
|
18,327 |
|
14,924 |
|
13,520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Utilization |
94.5 |
% |
95.5 |
% |
|
94.6 |
% |
95.1 |
% |
|
95.5 |
% |
94.3 |
% |
93.0 |
% |
94.4 |
% |
In 2023, we anticipate four further regulatory
drydockings, including for three of the four recently purchased
ships.
Vessel Operating Expenses
Vessel operating expenses, which are primarily
the costs of crew, lubricating oil, repairs, maintenance, insurance
and technical management fees, were up 4.8% to $43.4 million for
the second quarter of 2023, compared to $41.4 million in the
comparative period. The increase of $2.0 million was mainly due to
(i) increased crew expenses mainly due to global inflation and the
limited supply of crew and (ii) increased cost of insurances due to
premium increases. The average cost per ownership day in the
quarter was $7,320, compared to $7,006 for the prior year period,
up $314 per day, or 4.5%. For the six months ended June 30, 2023,
vessel operating expenses were $86.2 million, or an average of
$7,319 per day, compared to $80.9 million in the comparative
period, or $6,875 per day, an increase of $444 per ownership day,
or 6.5%.
Time Charter and Voyage Expenses
Time charter and voyage expenses comprise mainly
commission paid to ship brokers, the cost of bunker fuel for
owner’s account when a ship is off-hire or idle and miscellaneous
owner’s costs associated with a ship’s voyage. Time charter and
voyage expenses were $6.7 million for the second quarter of 2023,
compared to $5.1 million in the second quarter of 2022. The
increase was mainly due to increased commissions on charter
renewals at higher rates, higher costs for bunker fuel for owner’s
account due to increase in off hire days and additional voyage
administration costs and additional operational requests from
charterers.
For the six months ended June 30, 2023, time
charter and voyage expenses were $12.1 million, or an average of
$1,031 per day, compared to $9.5 million in the comparative period,
or $804 per day, an increase of $227 per ownership day, or 28.2%
mainly to the factors noted above.
Depreciation and Amortization
Depreciation and amortization for the second
quarter of 2023 was $22.2 million, compared to $20.3 million in the
second quarter of 2022. The increase was mainly due to the 14
drydockings completed after June 30, 2022.
Depreciation for the six months ended June 30,
2023 was $43.4 million, compared to $40.1 million in the
comparative period, with the increase being due to the 14
drydockings completed after June 30, 2022 and the acquisition of
the four vessels delivered during the second quarter of 2023.
General and Administrative Expenses
General and administrative expenses were $4.7
million in the second quarter of 2023, compared to $4.1 million in
the second quarter of 2022. The increase was mainly due to higher
stock-based compensation expense and a one-off expense occurred in
second quarter of 2023 due to social security costs related to
settlement of shares under the Omnibus Incentive Plan. The average
general and administrative expense per ownership day for the second
quarter of 2023 was $794, compared to $685 in the comparative
period, an increase of $109 or 15.9%.
For the six months ended June 30, 2023, general
and administrative expenses were $9.5 million, compared to $10.3
million in the comparative period mainly due to lower stock-based
compensation expense in the first quarter of 2023 and a one-off
expense that occurred in first quarter of 2022 due to social
security charges related to settlement of shares under the Omnibus
Incentive plan. The average general and administrative expense per
ownership day for the six-month period ended June 30, 2023 was
$807, compared to $875 in the comparative period, a decrease of $68
or 7.8%.
Adjusted EBITDA
Adjusted EBITDA (a non-GAAP financial measure)
was $108.2 million for the second quarter of 2023, up from $96.6
million for the second quarter of 2022, with the net increase being
mainly due to increased revenue from charter renewals at higher
rates.
Adjusted EBITDA for the six months ended June
30, 2023 was $213.1 million, compared to $187.0 million for the
comparative period, an increase of $26.1 million or 14.0%.
Interest Expense and Interest Income
Debt as at June 30, 2023 totaled $925.3 million,
comprising $491.3 million of secured bank debt collateralized by
vessels, $310.6 million of 2027 Secured Notes collateralized by
vessels, and $123.4 million under sale and leaseback financing
transactions. As of June 30, 2023, five vessels were
unencumbered.
Debt as at June 30, 2022 totaled $1,125.7
million, comprising $526.7 million of secured bank debt
collateralized by vessels, $350.0 million of 2027 USPP Notes
collateralized by vessels, $160.0 million under sale and leaseback
financing transactions and $89.0 million of unsecured indebtedness
on our 2024 Notes which were fully redeemed in July 2022. As of
June 30, 2022, five of our vessels were unencumbered.
Interest and other finance expenses for the
second quarter of 2023 was $10.9 million, down from $30.0 million
for the second quarter of 2022. The decrease in interest and other
finance expenses was mainly due to (i) a prepayment fee and
non-cash write off of deferred financing charges of $14.1 million
on the full repayment of Hayfin Credit Facility, (ii) the non-cash
write off of deferred financing charges of $0.3 million on the full
repayment of our Hellenic Credit Facility and (iii) $0.6 million
premium paid on the redemption in April of $28.5 million of 2024
Notes, all of which took place in the second quarter 2022. The
blended cost of our debt, taking into account the interest rate
caps, has increased from approximately 4.51% for the second quarter
2022 to 4.53% for the second quarter 2023 due to the new credit
facility for the four new vessels. Three month Libor increased in
the second quarter of 2023 to 5.55% as compared to 1.30% in the
prior year period.
Interest and other finance expenses for the six
months ended June 30, 2023 was $22.0 million, down from $48.7
million for the comparative period. The decrease is mainly due to
(i) the prepayment fee and the associated non-cash write off of
deferred financing charges of $14.1 million on the full repayment
of the Hayfin Credit Facility, (ii) the non-cash write off of
deferred financing charges of $0.3 million on the full repayment of
our Hellenic Credit Facility and (iii) the $0.6 million premium
paid on the redemption in April of $28.5 million of 2024 Notes and
(iv) a prepayment fee and the associated non-cash write off of
deferred financing charges of $4.1 million on the full repayment of
our Blue Ocean Junior Credit Facility, all of which took place in
the six months ended June 30 2022.
Interest income for the second quarter 2023 was
$2.6 million, up from $0.3 million for the second quarter of 2022.
Interest income for the six months period ended June 30, 2023 was
$4.4 million, compared to $0.5 million for the comparative
period.
Other (expenses)/income, Net
Other expenses, net was $0.4 million in the
second quarter 2023, compared to $0.2 million in the second quarter
of 2022. Other income, net was $1.2 million for the six month
period ended June 30, 2023, compared to $0.2 million for the
comparative period.
Fair value adjustment on derivatives
In December 2021, we entered into
a USD 1 month LIBOR interest rate cap of 0.75% through
fourth quarter of 2026 on $484.1 million of floating rate
debt, which reduces over time and represented approximately half of
the outstanding floating rate debt. In February 2022, we entered
into two additional USD 1-month LIBOR interest rate caps of 0.75%
through the fourth quarter of 2026 on the remaining balance
of $507.9 million of floating rate debt. One of these
interest rate caps was not designated as a cash flow hedge and
therefore the positive fair value adjustment of $1.4 million for
the second quarter of 2023 was recorded through our statement of
income. The negative fair value adjustment for the six month period
ended June 30, 2023 amounted to $1.4 million. Interest rate caps
have automatically transited to 1 month Compounded SOFR on July
1st, 2023 at a level of 0.64%.
Earnings Allocated to Preferred Shares
The Series B Preferred Shares carry a coupon of
8.75%, the cost of which for the second quarter of 2023 was $2.4
million, the same as in the second quarter 2022. The cost was $2.4
million in both quarters of 2023 and 2022 since there were no
additional Series B Preferred Shares issued under our at-the-market
program. The cost for the six months ended June 2023 was $4.8
million, the same as for the six months ended June 30, 2022.
Net Income Available to Common Shareholders
Net income available to common shareholders for
the three months ended June 30, 2023 was $75.4 million. Net income
available to common shareholders for the three months ended June
30, 2022 was $53.4 million.
Earnings per share for the three months ended
June 30, 2023 was $2.13, an increase of 44.9% from the earnings per
share for the comparative period, which was $1.47.
For the six months ended June 30, 2023, net
income available to common shareholders was $147.6 million. Net
income available to common shareholders for the six months ended
June 30, 2022 was $121.2 million.
Earnings per share for the six months ended June
30, 2023 was $4.15, an increase of 25.4% from the earnings per
share for the comparative period, which was $3.31.
Normalized net income (a non-GAAP financial
measure) for the three months ended June 30, 2023, was $74.0
million. Normalized net income for the three months ended June 30,
2022 was $66.2 million. Normalized net income for the six months
ended June 30, 2023 was $149.5 million, as compared to $133.5 for
the comparative period.
Normalized earnings per share (a non-GAAP
financial measure) for the three months ended June 30, 2023 was
$2.09, an increase of 14.8% from Normalized earnings per share for
the comparative period, which was $1.82.
Normalized earnings per share for the six months
ended June 30, 2023 was $4.21, an increase of 15.3% from Normalized
earnings per share for the comparative period, which was $3.65.
Fleet
As at June 30, 2023, we had 68 containerships in
our fleet.
|
Vessel Name |
Capacity in TEUs |
Lightweight (tons) |
Year Built |
Charterer |
Earliest Charter Expiry Date |
Latest Charter Expiry Date (2) |
Daily Charter Rate $ |
|
|
|
|
|
|
|
|
|
|
CMA CGM Thalassa |
11,040 |
38,577 |
2008 |
CMA CGM |
4Q25 |
2Q26 |
47,200 |
| ZIM Norfolk (ex UASC Al Khor)
(1) |
9,115 |
31,764 |
2015 |
ZIM |
2Q27 |
4Q27 |
65,000 |
|
Anthea Y (1) |
9,115 |
31,890 |
2015 |
COSCO (3) |
3Q25 |
4Q25 (3) |
38,000 (3) |
|
ZIM Xiamen (ex Maira XL)(1) |
9,115 |
31,820 |
2015 |
ZIM |
3Q27 |
4Q27 |
65,000 |
|
MSC Tianjin |
8,603 |
34,325 |
2005 |
MSC |
2Q24 |
3Q24 |
19,000 |
|
MSC Qingdao (4) |
8,603 |
34,609 |
2004 |
MSC |
2Q24 |
2Q25 |
23,000 |
|
GSL Ningbo |
8,603 |
34,340 |
2004 |
MSC |
3Q27 |
4Q27 (5) |
22,500 (5) |
|
tbr GSL Alexandra |
8,544 |
37,777 |
2004 |
Confidential |
3Q25 |
3Q26 |
Confidential (6) |
|
tbr GSL Sofia |
8,544 |
37,777 |
2003 |
Confidential |
3Q25 |
3Q26 |
Confidential (6) |
|
tbr GSL Effie |
8,544 |
37,777 |
2003 |
Confidential |
3Q25 |
3Q26 |
Confidential (6) |
|
GSL Lydia |
8,544 |
37,777 |
2003 |
Confidential |
2Q25 |
4Q26 |
Confidential (6) |
|
GSL Eleni |
7,847 |
29,261 |
2004 |
Maersk |
3Q24 |
1Q25 (7) |
16,500 (7) |
|
GSL Kalliopi |
7,847 |
29,105 |
2004 |
Maersk |
3Q24 |
4Q24 (7) |
18,900 (7) |
|
GSL Grania |
7,847 |
29,190 |
2004 |
Maersk |
3Q24 |
1Q25 (7) |
17,750 (7) |
|
Mary (1) |
6,927 |
23,424 |
2013 |
CMA CGM (8) |
4Q28 |
1Q31 (8) |
25,910 (8) |
|
Kristina (1) |
6,927 |
23,421 |
2013 |
CMA CGM (8) |
3Q29 |
3Q31 (8) |
25,910 (8) |
|
Katherine (1) |
6,927 |
23,403 |
2013 |
CMA CGM (8) |
1Q29 |
2Q31 (8) |
25,910 (8) |
|
Alexandra (1) |
6,927 |
23,348 |
2013 |
CMA CGM (8) |
2Q29 |
3Q31 (8) |
25,910 (8) |
|
Alexis (1) |
6,882 |
23,919 |
2015 |
CMA CGM (8) |
2Q29 |
3Q31 (8) |
25,910 (8) |
|
Olivia I (1) |
6,882 |
23,864 |
2015 |
CMA CGM (8) |
2Q29 |
2Q31 (8) |
25,910 (8) |
|
GSL Christen |
6,840 |
27,954 |
2002 |
Maersk |
3Q23 |
1Q24 |
35,000 |
|
GSL Nicoletta |
6,840 |
28,070 |
2002 |
Maersk |
3Q24 |
1Q25 |
35,750 |
|
CMA CGM Berlioz |
6,621 |
26,776 |
2001 |
CMA CGM |
4Q25 |
2Q26 |
37,750 |
|
Agios Dimitrios (4) |
6,572 |
24,931 |
2011 |
MSC |
4Q23 |
3Q24 |
20,000 |
|
GSL Vinia |
6,080 |
23,737 |
2004 |
Maersk |
3Q24 |
1Q25 |
13,250 |
|
GSL Christel Elisabeth |
6,080 |
23,745 |
2004 |
Maersk |
2Q24 |
1Q25 |
13,250 |
|
GSL Dorothea |
5,992 |
24,243 |
2001 |
Maersk |
3Q24 |
3Q26 |
18,600 (9) |
|
GSL Arcadia |
6,008 |
24,858 |
2000 |
Maersk |
2Q24 |
1Q26 |
18,600 (9) |
|
GSL Violetta |
6,008 |
24,873 |
2000 |
Maersk |
4Q24 |
4Q25 |
18,600 (9) |
|
GSL Maria |
6,008 |
24,414 |
2001 |
Maersk |
4Q24 |
1Q27 |
18,600 (9) |
|
GSL MYNY |
6,008 |
24,873 |
2000 |
Maersk |
3Q24 |
1Q26 |
18,600 (9) |
|
GSL Melita |
6,008 |
24,848 |
2001 |
Maersk |
3Q24 |
3Q26 |
18,600 (9) |
|
GSL Tegea |
5,992 |
24,308 |
2001 |
Maersk |
3Q24 |
3Q26 |
18,600 (9) |
|
Tasman |
5,936 |
25,010 |
2000 |
Maersk |
4Q23 |
2Q24 |
20,000 |
|
ZIM Europe |
5,936 |
25,010 |
2000 |
ZIM |
1Q24 |
2Q24 |
24,250 |
|
Ian H |
5,936 |
25,128 |
2000 |
ZIM |
2Q24 |
4Q24 |
32,500 |
|
GSL Tripoli |
5,470 |
22,259 |
2009 |
Maersk |
4Q24 |
4Q27 |
36,500 (10) |
|
GSL Kithira |
5,470 |
22,108 |
2009 |
Maersk |
4Q24 |
1Q28 |
36,500 (10) |
|
GSL Tinos |
5,470 |
22,067 |
2010 |
Maersk |
4Q24 |
4Q27 |
36,500 (10) |
|
GSL Syros |
5,470 |
22,098 |
2010 |
Maersk |
4Q24 |
4Q27 |
36,500 (10) |
|
Dolphin II |
5,095 |
20,596 |
2007 |
OOCL |
1Q25 |
3Q25 |
53,500 |
|
Orca I |
5,095 |
20,633 |
2006 |
Maersk |
2Q24 |
4Q25 |
21,000 (11) |
|
CMA CGM Alcazar |
5,089 |
20,087 |
2007 |
CMA CGM |
3Q26 |
1Q27 |
35,500 |
|
GSL Château d’If |
5,089 |
19,994 |
2007 |
CMA CGM |
4Q26 |
1Q27 |
35,500 |
|
GSL Susan |
4,363 |
17,309 |
2008 |
CMA CGM |
3Q27 |
1Q28 |
Confidential (12) |
|
CMA CGM Jamaica |
4,298 |
17,272 |
2006 |
CMA CGM |
1Q28 |
2Q28 |
Confidential (12) |
|
CMA CGM Sambhar |
4,045 |
17,429 |
2006 |
CMA CGM |
1Q28 |
2Q28 |
Confidential (12) |
|
CMA CGM America |
4,045 |
17,428 |
2006 |
CMA CGM |
1Q28 |
2Q28 |
Confidential (12) |
|
GSL Rossi |
3,421 |
16,420 |
2012 |
ZIM |
1Q26 |
3Q26 |
38,875 (13) |
|
GSL Alice |
3,421 |
16,543 |
2014 |
CMA CGM |
2Q25 |
2Q25 |
20,500 (14) |
|
GSL Eleftheria |
3,404 |
16,642 |
2013 |
Maersk |
3Q25 |
4Q25 |
37,975 |
|
GSL Melina |
3,404 |
16,703 |
2013 |
Hapag-Lloyd |
2Q24 |
3Q24 |
21,000 |
|
GSL Valerie |
2,824 |
11,971 |
2005 |
ZIM |
1Q25 |
3Q25 |
35,600 (15) |
|
Matson Molokai |
2,824 |
11,949 |
2007 |
Matson |
2Q25 |
3Q25 |
36,500 |
|
GSL Lalo |
2,824 |
11,950 |
2006 |
MSC |
1Q24 |
2Q24 |
17,500 |
|
GSL Mercer |
2,824 |
11,970 |
2007 |
ONE |
4Q24 |
2Q25 |
35,750 |
|
Athena |
2,762 |
13,538 |
2003 |
Hapag-Lloyd |
2Q24 |
2Q24 |
21,500 |
|
GSL Elizabeth |
2,741 |
11,507 |
2006 |
ONE |
3Q23 |
3Q23 |
18,750 |
|
Beethoven tbr GSL Chloe |
2,546 |
12,212 |
2012 |
ONE |
4Q24 |
1Q25 |
33,000 |
|
GSL Maren |
2,546 |
12,243 |
2014 |
Swire |
1Q24 |
2Q24 |
18,200 (16) |
|
Maira |
2,506 |
11,453 |
2000 |
Hapag-Lloyd |
3Q23 |
4Q23 |
17,750 |
|
Nikolas |
2,506 |
11,370 |
2000 |
CMA CGM |
1Q24 |
1Q24 |
16,750 |
|
Newyorker |
2,506 |
11,463 |
2001 |
CMA CGM |
1Q24 |
3Q24 |
20,700 |
|
Manet |
2,272 |
11,727 |
2001 |
OOCL |
4Q24 |
2Q25 |
32,000 |
|
Keta |
2,207 |
11,731 |
2003 |
CMA CGM |
1Q25 |
1Q25 |
25,000 |
|
Julie |
2,207 |
11,731 |
2002 |
Footnote (17) |
2Q25 |
3Q25 |
Footnote (17) |
|
Kumasi |
2,207 |
11,791 |
2002 |
Wan Hai |
1Q25 |
2Q25 |
38,000 |
|
Akiteta |
2,207 |
11,731 |
2002 |
OOCL |
4Q24 |
1Q25 |
32,000 |
|
|
|
|
|
|
|
|
|
|
(1) Modern design, high reefer capacity, fuel-efficient vessel. (2)
In many instances charterers have the option to extend a charter
beyond the nominal latest expiry date by the amount of time that
the vessel was off hire during the course of that charter. This
additional charter time (“Offhire Extension”) is computed at the
end of the initially contracted charter period. The Latest Charter
Expiry Dates shown in this table have been adjusted to reflect
offhire accrued up to the date of issuance of this release plus
estimated offhire scheduled to occur during the remaining lifetimes
of the respective charters. However, as actual offhire can only be
calculated at the end of each charter, in some cases actual Offhire
Extensions – if invoked by charterers – may exceed the Latest
Charter Expiry Dates indicated. (3) Anthea Y was forward fixed to a
leading liner operator for a period of 24 months +/- 30 days, with
the new charter to commence upon expiry of the existing charter in
3Q or 4Q23. The new charter is expected to generate annualized
Adjusted EBITDA of approximately $11.9 million.(4) MSC Qingdao
& Agios Dimitrios are fitted with Exhaust Gas Cleaning Systems
(“scrubbers”). (5) GSL Ningbo chartered to MSC at $22,500 per day
to July 2023. Thereafter, the charter has been extended by 48 to 52
months, at a rate expected to generate annualized Adjusted EBITDA
of approximately $16.5 million.(6) Tbr GSL Alexandra, tbr GSL
Sofia, tbr GSL Effie and GSL Lydia delivered in 2Q23. Contract
cover for each vessel is for a minimum firm period 24 months from
the date each vessel is delivered, with charterers holding one year
extension options. The vessels are expected to generate aggregate
Adjusted EBITDA of approximately $76.6 million over the minimum
firm period, increasing to $95.3 million if all options are
exercised. (7) GSL Eleni (delivered 2Q 2019) is chartered for five
years; GSL Kalliopi (delivered 4Q 2019) and GSL Grania (delivered
3Q 2019) are chartered for three years plus two successive periods
of one year each, at the option of the charterer. The first of
these extension options was exercised for both vessels in 2Q 2022
and commenced for GSL Grania and for GSL Kalliopi in 3Q and in 4Q
2022, respectively. The second of these extension options was
exercised for both vessels in 2Q 2023 and will commence for both
vessels in 3Q23. During the option periods the charter rates for
GSL Kalliopi and GSL Grania are $18,900 per day and $17,750 per day
respectively. (8) Mary, Kristina, Katherine, Alexandra, Alexis,
Olivia I were forward fixed to Hapag-Lloyd for five years, followed
by two periods of 12 months each at the option of the charterer.
The new charters are scheduled to commence as each of the existing
charters expire, on a staggered basis, between approximately late
2023 and late 2024, following the expiration of existing charters.
The charters are expected to generate average annualized Adjusted
EBITDA of approximately $13.1 million per ship.(9) GSL Maria, GSL
Violetta, GSL Arcadia, GSL MYNY, GSL Melita, GSL Tegea and GSL
Dorothea. Contract cover for each ship is for a firm period of at
least three years from the date each vessel was delivered, with
charterers holding a one-year extension option on each charter (at
a rate of $12,900 per day), followed by a second option (at a rate
of $12,700 per day) with the period determined by – and terminating
prior to – each vessel’s 25th year drydocking & special survey.
(10) GSL Tripoli, GSL Kithira, GSL Tinos, and GSL Syros. Ultra-high
reefer ships of 5,470 TEU each. Contract cover on each ship is for
a firm period of three years, from their delivery dates in 2021, at
a rate of $36,500 per day, with a period of an additional three
years (at $17,250 per day) at charterers’ option.(11) Orca I.
Chartered at $21,000 per day through to the median expiry of the
charter in 2Q2024; thereafter the charterer has the option to
charter the vessel for a further 12-14 months at the same rate.
(12) GSL Susan, CMA CGM Jamaica, CMA CGM Sambhar and CMA CGM
America. In July 2022, these four vessels were each forward fixed
for five years +/- 45 days at charter rates expected to generate
average annualized Adjusted EBITDA of approximately $11.2 million
per vessel. The new charter for GSL Susan commenced in 4Q 2022,
while the charters for the remaining three vessels commenced in
late 1Q 2023. (13) GSL Rossi. Chartered at an average rate of
$38,875 per day-$42,750 for the first 18 months, $38,000 for the
next 18 months and $35,000 for the remaining period.(14) GSL Alice.
Chartered at $20,500 per day for a period of 24 months +/- 30 days
at the option of charterer. The new charter commenced in May 2023.
(15) GSL Valerie. Chartered at an average rate of $35,600 per
day-$40,000 for the first 12 months, $36,000 for the next 12 months
and $32,000 for the remaining period.(16) GSL Maren. Charter
extended to Westwood (Swire) for a period of 11 to 14 months,
commenced at the end of 1Q 2023 at a rate of $17,200 per day for
the first 2 months and for the remaining period at a rate of
$18,200.(17) Julie was forward fixed to a leading liner company for
a period of 24 months +/- 30 days at the option of the charterer.
The new charter commenced in 3Q 2023, after the vessel’s scheduled
drydock. The new charter is expected to generate annualized
Adjusted EBITDA of approximately $2.0 million. |
Conference Call and Webcast
Global Ship Lease will hold a conference call to
discuss the Company's results for the three and six months ended
June 30, 2023 today, Thursday August 3, 2023 at 10:30 a.m. Eastern
Time. There are two ways to access the conference call:
(1) Dial-in: (800) 715-9871 or (646) 307-1963;
Passcode: 8238520
Please dial in at least 10 minutes prior to
10:30 a.m. Eastern Time to ensure a prompt start to the call.
(2) Live Internet webcast and slide
presentation: http://www.globalshiplease.com
The webcast will also be archived on the
Company’s website: http://www.globalshiplease.com.
Annual Report on Form 20-F
The Company’s Annual Report for 2022 was filed
with the Securities and Exchange Commission (the “Commission”) on
March 23, 2023. A copy of the report can be found under the
Investor Relations section (Annual Reports) of the Company’s
website at http://www.globalshiplease.com or on the Commission’s
website at www.sec.gov. Shareholders may request a hard copy of the
audited financial statements free of charge by contacting the
Company at info@globalshiplease.com or by writing to Global Ship
Lease, Inc, care of Global Ship Lease Services Limited, 25 Wilton
Road, London SW1V ILW.
About Global Ship Lease
Global Ship Lease is a leading independent owner
of containerships with a diversified fleet of mid-sized and smaller
containerships. Incorporated in the Marshall Islands, Global Ship
Lease commenced operations in December 2007 with a business of
owning and chartering out containerships under fixed-rate charters
to top tier container liner companies. It was listed on the New
York stock Exchange in August 2008.
As at June 30, 2023, Global Ship
Lease owned 68 containerships ranging from 2,207 to 11,040
TEU, with an aggregate capacity of 375,406 TEU. 36 ships are
wide-beam Post-Panamax.
As at June 30, 2023, the average remaining term
of the Company’s charters, to the mid-point of redelivery,
including options under the Company’s control and other than if a
redelivery notice has been received, was 2.3 years on a
TEU-weighted basis. Contracted revenue on the same basis
was $1.97 billion. Contracted revenue was $2.39 billion,
including options under charterers’ control and with latest
redelivery date, representing a weighted average remaining term of
3.1 years.
Reconciliation of Non-U.S. GAAP Financial
Measures
To supplement our financial information
presented in accordance with U.S. GAAP, we use certain “non-GAAP
financial measures” as such term is defined in Regulation G
promulgated by the SEC. Generally, a non-GAAP financial measure is
a numerical measure of a company’s operating performance, financial
position or cash flows that excludes or includes amounts that are
included in, or excluded from, the most directly comparable measure
calculated and presented in accordance with U.S. GAAP. We believe
that the presentation of these measures provides investors with
greater transparency and supplemental data relating to our
financial condition and results of operations, and therefore a more
complete understanding of factors affecting our business than U.S.
GAAP measures alone. In addition, we believe that the presentation
of these matters is useful to investors for period-to-period
comparison of results as the items may reflect certain unique
and/or non-operating items such as impairment charges, contract
termination costs or items outside of our control.
We believe that the presentation of the
following non-U.S. GAAP financial measures is useful to investors
because they are frequently used by securities analysts, investors
and other interested parties in the evaluation of companies in our
industry.
A. Adjusted EBITDAAdjusted EBITDA represents net
income available to common shareholders before interest income and
expense, earnings allocated to preferred shares, income taxes,
depreciation and amortization of drydocking net costs, gains or
losses on the sale of vessels, amortization of intangible
liabilities, charges for share based compensation, fair value
adjustment on derivatives, the effect of the straight lining of
time charter modifications, and impairment losses. Adjusted EBITDA
is a non-U.S. GAAP quantitative measure used to assist in the
assessment of our ability to generate cash from our operations. We
believe that the presentation of Adjusted EBITDA is useful to
investors because it is frequently used by securities analysts,
investors and other interested parties in the evaluation of
companies in our industry. Adjusted EBITDA is not defined in U.S.
GAAP and should not be considered to be an alternative to net
income or any other financial metric required by such accounting
principles. Our use of Adjusted EBITDA may vary from the use of
similarly titled measures by others in our industry.
Adjusted EBITDA is presented herein both on a
historic basis and on a forward-looking basis in certain instances.
We do not provide a reconciliation of such
forward looking non-U.S. GAAP financial measure
to the most directly comparable U.S. GAAP measure because such
U.S. GAAP financial measure on a forward-looking basis is not
available to us without unreasonable effort.
ADJUSTED EBITDA - UNAUDITED
(thousands of U.S. dollars)
|
|
|
Three |
|
Three |
|
Six |
|
Six |
|
| |
|
months |
|
months |
|
months |
|
months |
|
| |
|
ended |
|
ended |
|
ended |
|
ended |
|
| |
|
June 30, |
|
June 30, |
|
June 30, |
|
June 30, |
|
| |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
| |
|
|
|
|
|
| Net income
available to Common Shareholders |
75,392 |
|
53,351 |
|
147,612 |
|
121,157 |
|
| |
|
|
|
|
|
| Adjust: |
Depreciation and
amortization |
22,172 |
|
20,273 |
|
43,356 |
|
40,125 |
|
| |
Amortization of
intangible liabilities |
(1,681 |
) |
(10,565 |
) |
(5,045 |
) |
(23,420 |
) |
| |
Fair value
adjustment on derivative asset |
(1,417 |
) |
(2,084 |
) |
1,368 |
|
(6,648 |
) |
| |
Interest
income |
(2,582 |
) |
(265 |
) |
(4,394 |
) |
(515 |
) |
| |
Interest
expense |
10,905 |
|
30,007 |
|
22,008 |
|
48,742 |
|
| |
Share based
compensation |
2,505 |
|
2,231 |
|
5,179 |
|
5,661 |
|
| |
Earnings allocated
to preferred shares |
2,384 |
|
2,384 |
|
4,768 |
|
4,768 |
|
| |
Income tax |
5 |
|
- |
|
5 |
|
- |
|
| |
Effect from
straight lining time charter modifications |
483 |
|
1,247 |
|
(1,785 |
) |
(2,911 |
) |
| Adjusted
EBITDA |
108,166 |
|
96,579 |
|
213,072 |
|
186,959 |
|
B. Normalized net incomeNormalized net income
represents net income available to common shareholders after
adjusting for certain non-recurring items. Normalized net income is
a non-U.S. GAAP quantitative measure which we believe will assist
investors and analysts who often adjust reported net income for
items that do not affect operating performance or operating cash
generated. Normalized net income is not defined in U.S. GAAP and
should not be considered to be an alternate to net income or any
other financial metric required by such accounting principles. Our
use of Normalized net income may vary from the use of similarly
titled measures by others in our industry.
NORMALIZED NET INCOME – UNAUDITED
(thousands of U.S. dollars)
|
|
|
Three |
|
Three |
|
Six |
|
Six |
|
| |
|
months |
|
months |
|
months |
|
months |
|
| |
|
ended |
|
ended |
|
ended |
|
ended |
|
| |
|
June 30, |
|
June 30, |
|
June 30, |
|
June 30, |
|
| |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
| |
|
|
|
|
|
|
| Net income
available to Common Shareholders |
75,392 |
|
53,351 |
|
147,612 |
|
121,157 |
|
| |
|
|
|
|
|
|
| Adjust: |
Fair value
adjustment on derivative assets |
(1,417 |
) |
(2,084 |
) |
1,368 |
|
(6,648 |
) |
| |
Premium paid on
redemption of 2024 Notes |
- |
|
570 |
|
- |
|
570 |
|
| |
Accelerated write
off of deferred financing charges related to full repayment of
Hellenic Credit Facility |
- |
|
298 |
|
- |
|
298 |
|
| |
Accelerated write
off of deferred financing charges related to full repayment of
Hayfin Credit Facility |
- |
|
2,822 |
|
- |
|
2,822 |
|
| |
Prepayment fee on
repayment of Hayfin Credit Facility |
- |
|
11,229 |
|
- |
|
11,229 |
|
| |
Prepayment fee on
repayment of Blue Ocean Credit Facility |
- |
|
- |
|
- |
|
3,968 |
|
| |
Accelerated write
off of deferred financing charges related to full repayment of Blue
Ocean Credit Facility |
- |
|
- |
|
- |
|
83 |
|
| |
Accelerated write
off of deferred financing charges related to partial repayment of
HCOB-CACIB Credit Facility |
- |
|
- |
|
108 |
|
- |
|
| |
Forfeit of certain
stock-based compensation awards |
- |
|
- |
|
451 |
|
- |
|
| |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Normalized net
income |
73,975 |
|
66,186 |
|
149,539 |
|
133,479 |
|
C. Normalized Earnings per ShareNormalized
Earnings per Share represents Earnings per Share after adjusting
for certain non-recurring items. Normalized Earnings per Share is a
non-U.S. GAAP quantitative measure which we believe will assist
investors and analysts who often adjust reported Earnings per Share
for items that do not affect operating performance or operating
cash generated. Normalized Earnings per Share is not defined in
U.S. GAAP and should not be considered to be an alternate to
Earnings per Share as reported or any other financial metric
required by such accounting principles. Our use of Normalized
Earnings per Share may vary from the use of similarly titled
measures by others in our industry.
NORMALIZED EARNINGS PER SHARE - UNAUDITED
|
|
|
Three |
|
Three |
|
Six |
|
Six |
|
| |
|
months |
|
months |
|
months |
|
months |
|
| |
|
ended |
|
ended |
|
ended |
|
ended |
|
| |
|
June 30, |
|
June 30, |
|
June 30, |
|
June 30, |
|
| |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| EPS as reported
(USD) |
2.13 |
|
1.47 |
|
4.15 |
|
3.31 |
|
| Normalized net
income adjustments-Class A common shares (in thousands USD) |
(1,417 |
) |
12,835 |
|
1,927 |
|
12,322 |
|
| Weighted average
number of Class A Common shares |
35,375,684 |
|
36,347,270 |
|
35,533,273 |
|
36,578,297 |
|
| Adjustment on EPS
(USD) |
(0.04 |
) |
0.35 |
|
0.06 |
|
0.34 |
|
| Normalized EPS
(USD) |
2.09 |
|
1.82 |
|
4.21 |
|
3.65 |
|
Safe Harbor Statement
This communication contains forward-looking
statements. Forward-looking statements provide Global Ship Lease's
current expectations or forecasts of future events. Forward-looking
statements include statements about Global Ship Lease's
expectations, beliefs, plans, objectives, intentions, assumptions
and other statements that are not historical facts. Words or
phrases such as "anticipate", "believe", "continue", "estimate",
"expect", "intend", "may", "ongoing", "plan", "potential",
"predict", “should”, "project", "will" or similar words or phrases,
or the negatives of those words or phrases, may identify
forward-looking statements, but the absence of these words does not
necessarily mean that a statement is not forward-looking. These
forward-looking statements are based on assumptions that may be
incorrect, and Global Ship Lease cannot assure you that these
projections included in these forward-looking statements will come
to pass. Actual results could differ materially from those
expressed or implied by the forward-looking statements as a result
of various factors.
The risks and uncertainties include, but are not limited to:
- future operating or financial results;
- expectations regarding the strength of future growth of the
container shipping industry, including the rates of annual demand
and supply growth;
- geo-political events such as the conflict in Ukraine;
- the length and severity of the ongoing outbreak of the novel
coronavirus (COVID-19) around the world and governmental responses
thereto;
- the financial condition of our charterers and their ability and
willingness to pay charterhire to us in accordance with the
charters and our expectations regarding the same;
- the overall health and condition of the U.S. and global
financial markets;
- our financial condition and liquidity, including our ability to
obtain additional financing to fund capital expenditures, vessel
acquisitions and for other general corporate purposes and our
ability to meet our financial covenants and repay our
borrowings;
- our expectations relating to dividend payments and expectations
of our ability to make such payments including the availability of
cash and the impact of constraints under our loan agreements;
- future acquisitions, business strategy and expected capital
spending;
- operating expenses, availability of key employees, crew, number
of off-hire days, drydocking and survey requirements, costs of
regulatory compliance, insurance costs and general and
administrative costs;
- general market conditions and shipping industry trends,
including charter rates and factors affecting supply and
demand;
- assumptions regarding interest rates and inflation;
- changes in the rate of growth of global and various regional
economies;
- risks incidental to vessel operation, including piracy,
discharge of pollutants and vessel accidents and damage including
total or constructive total loss;
- estimated future capital expenditures needed to preserve our
capital base;
- our expectations about the availability of vessels to purchase,
the time that it may take to construct new vessels, or the useful
lives of our vessels;
- our continued ability to enter into or renew charters including
the re-chartering of vessels on the expiry of existing charters, or
to secure profitable employment for our vessels in the spot
market;
- our ability to realize expected benefits from our acquisition
of secondhand vessels;
- our ability to capitalize on our management’s and directors’
relationships and reputations in the containership industry to its
advantage;
- changes in governmental and classification societies’ rules and
regulations or actions taken by regulatory authorities;
- expectations about the availability of insurance on
commercially reasonable terms;
- changes in laws and regulations (including environmental rules
and regulations);
- potential liability from future litigation; and
- other important factors described from time to time in the
reports we file with the U.S. Securities and Exchange Commission
(the “SEC”).
Forward-looking statements are subject to known
and unknown risks and uncertainties and are based on potentially
inaccurate assumptions that could cause actual results to differ
materially from those expected or implied by the forward-looking
statements. Global Ship Lease's actual results could differ
materially from those anticipated in forward-looking statements for
many reasons specifically as described in Global Ship Lease's
filings with the SEC. Accordingly, you should not unduly rely on
these forward-looking statements, which speak only as of the date
of this communication. Global Ship Lease undertakes no obligation
to publicly revise any forward-looking statement to reflect
circumstances or events after the date of this communication or to
reflect the occurrence of unanticipated events. You should,
however, review the factors and risks Global Ship Lease describes
in the reports it will file from time to time with the SEC after
the date of this communication.
|
Global Ship Lease, Inc. |
|
|
|
Interim Unaudited Condensed Consolidated Balance
Sheets |
|
|
|
(Expressed in thousands of U.S. dollars except share data) |
|
|
| |
June 30, 2023 |
|
December 31, 2022 |
|
ASSETS |
|
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
|
|
|
| Cash and cash equivalents |
$ |
84,493 |
|
|
$ |
120,130 |
|
| Time deposits |
|
12,600 |
|
|
|
8,550 |
|
| Restricted cash |
|
45,142 |
|
|
|
28,363 |
|
| Accounts receivable, net |
|
3,109 |
|
|
|
3,684 |
|
| Inventories |
|
13,399 |
|
|
|
12,237 |
|
| Prepaid expenses and other
current assets |
|
36,252 |
|
|
|
33,765 |
|
| Derivative asset |
|
28,177 |
|
|
|
29,645 |
|
| Due from related parties |
|
48 |
|
|
|
673 |
|
| Total current
assets |
$ |
223,220 |
|
|
$ |
237,047 |
|
| NON - CURRENT
ASSETS |
|
|
|
|
|
|
|
| Vessels in operation |
$ |
1,716,778 |
|
|
$ |
1,623,307 |
|
| Advances for vessels'
acquisitions and other additions |
|
6,699 |
|
|
|
4,881 |
|
| Deferred charges, net |
|
69,106 |
|
|
|
54,663 |
|
| Other non - current
assets |
|
31,572 |
|
|
|
31,022 |
|
| Derivative asset, net of
current portion |
|
28,727 |
|
|
|
33,858 |
|
| Restricted cash, net of
current portion |
|
116,767 |
|
|
|
121,437 |
|
| Total non - current
assets |
|
1,969,649 |
|
|
|
1,869,168 |
|
| TOTAL
ASSETS |
$ |
2,192,869 |
|
|
$ |
2,106,215 |
|
| LIABILITIES AND
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
|
|
|
| Accounts payable |
$ |
25,809 |
|
|
$ |
22,755 |
|
| Accrued liabilities |
|
29,624 |
|
|
|
36,038 |
|
| Current portion of long-term
debt |
|
204,140 |
|
|
|
189,832 |
|
| Current portion of deferred
revenue |
|
29,661 |
|
|
|
12,569 |
|
| Due to related parties |
|
692 |
|
|
|
572 |
|
| Total current
liabilities |
$ |
289,926 |
|
|
$ |
261,766 |
|
| LONG-TERM
LIABILITIES |
|
|
|
|
|
|
|
| Long - term debt, net of
current portion and deferred financing costs |
$ |
707,673 |
|
|
$ |
744,557 |
|
| Intangible liabilities-charter
agreements |
|
8,697 |
|
|
|
14,218 |
|
| Deferred revenue, net of
current portion |
|
114,331 |
|
|
|
119,183 |
|
| Total non - current
liabilities |
|
830,701 |
|
|
|
877,958 |
|
| Total
liabilities |
$ |
1,120,627 |
|
|
$ |
1,139,724 |
|
| Commitments and
Contingencies |
|
|
|
|
|
- |
|
| SHAREHOLDERS'
EQUITY |
|
|
|
|
|
|
|
| Class A common shares -
authorized214,000,000 shares with a $0.01 par value35,165,914
shares issued and outstanding (2022 – 35,990,288 shares) |
$ |
351 |
|
|
$ |
359 |
|
| Series B Preferred Shares -
authorized104,000 shares with a $0.01 par value43,592 shares issued
and outstanding (2022 – 43,592 shares) |
|
- |
|
|
|
- |
|
| Additional paid in
capital |
|
676,571 |
|
|
|
688,262 |
|
| Retained earnings |
|
367,311 |
|
|
|
246,390 |
|
| Accumulated other
comprehensive income |
|
28,009 |
|
|
|
31,480 |
|
| Total shareholders'
equity |
|
1,072,242 |
|
|
|
966,491 |
|
| TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY |
$ |
2,192,869 |
|
|
$ |
2,106,215 |
|
|
Global Ship Lease, Inc. |
|
|
|
Interim Unaudited Condensed Consolidated
Statements of Income |
|
|
|
(Expressed in thousands of U.S. dollars) |
|
|
| |
Three months ended June 30, |
|
Six months ended June 30, |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| OPERATING
REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
Time charter revenue (includes related party revenues of $nil and
$27,266 for each of the three month periods ended June 30, 2023 and
2022, respectively, and $nil and $66,929 for each of the six month
periods ended June 30, 2023 and 2022, respectively) |
$ |
160,399 |
|
|
$ |
143,891 |
|
|
$ |
316,326 |
|
|
$ |
284,667 |
|
| Amortization of intangible
liabilities-charter agreements (includes related party amortization
of intangible liabilities-charter agreements of $nil and $2,094 for
the three month periods ended June 30, 2023 and 2022, respectively,
and $nil and $5,385 for each of the six month periods ended June
30, 2023 and 2022, respectively) |
|
1,681 |
|
|
|
10,565 |
|
|
|
5,045 |
|
|
|
23,420 |
|
| Total Operating
Revenues |
|
162,080 |
|
|
|
154,456 |
|
|
|
321,371 |
|
|
|
308,087 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
| OPERATING
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
| Vessel operating expenses
(includes related party vessel operating expenses of $4,556 and
$4,230 for each of the three month periods ended June 30, 2023 and
2022, respectively, and $8,901 and $8,609 for each of the six month
periods ended June 30, 2023 and 2022, respectively) |
|
43,407 |
|
|
|
41,442 |
|
|
|
86,169 |
|
|
|
80,886 |
|
| Time charter and voyage expenses
(includes related party time charter and voyage expenses of $1,942
and $1,473 for the three month periods ended June 30, 2023 and
2022, respectively, and $3,662 and $2,950 for each of the six month
periods ended June 30, 2023 and 2022, respectively) |
|
6,681 |
|
|
|
5,101 |
|
|
|
12,139 |
|
|
|
9,458 |
|
| Depreciation and
amortization |
|
22,172 |
|
|
|
20,273 |
|
|
|
43,356 |
|
|
|
40,125 |
|
| General and administrative
expenses |
|
4,711 |
|
|
|
4,054 |
|
|
|
9,500 |
|
|
|
10,292 |
|
| Operating
Income |
|
85,109 |
|
|
|
83,586 |
|
|
|
170,207 |
|
|
|
167,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NON-OPERATING
INCOME/(EXPENSES) |
|
|
|
|
|
|
|
|
|
|
|
| Interest income |
|
2,582 |
|
|
|
265 |
|
|
|
4,394 |
|
|
|
515 |
|
| Interest and other finance
expenses |
|
(10,905 |
) |
|
|
(30,007 |
) |
|
|
(22,008 |
) |
|
|
(48,742 |
) |
| Other income, net |
|
(422 |
) |
|
|
(193 |
) |
|
|
1,160 |
|
|
|
178 |
|
| Fair value adjustment on
derivative asset |
|
1,417 |
|
|
|
2,084 |
|
|
|
(1,368 |
) |
|
|
6,648 |
|
| Total non-operating
expenses |
|
(7,328 |
) |
|
|
(27,851 |
) |
|
|
(17,822 |
) |
|
|
(41,401 |
) |
| Income before income
taxes |
|
77,781 |
|
|
|
55,735 |
|
|
|
152,385 |
|
|
|
125,925 |
|
| Income taxes |
|
(5 |
) |
|
|
- |
|
|
|
(5 |
) |
|
|
- |
|
| Net
Income |
|
77,776 |
|
|
|
55,735 |
|
|
|
152,380 |
|
|
|
125,925 |
|
| Earnings allocated to Series B
Preferred Shares |
|
(2,384 |
) |
|
|
(2,384 |
) |
|
|
(4,768 |
) |
|
|
(4,768 |
) |
| Net Income available
to Common Shareholders |
$ |
75,392 |
|
|
$ |
53,351 |
|
|
$ |
147,612 |
|
|
$ |
121,157 |
|
|
Global Ship Lease, Inc. |
|
|
|
Interim Unaudited Condensed Consolidated Statements of Cash
Flows |
|
|
|
(Expressed in thousands of U.S. dollars) |
|
|
| |
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
|
|
|
| Net income |
$ |
77,776 |
|
|
$ |
55,735 |
|
|
$ |
152,380 |
|
|
$ |
125,925 |
|
| Adjustments to
reconcile net income to net cash provided by operating
activities: |
|
|
|
|
|
|
|
|
|
|
|
| Depreciation and
amortization |
$ |
22,172 |
|
|
$ |
20,273 |
|
|
$ |
43,356 |
|
|
$ |
40,125 |
|
| Amounts reclassified from
other comprehensive income |
|
(137 |
) |
|
|
- |
|
|
|
(176 |
) |
|
|
- |
|
| Amortization of derivative
asset's premium |
|
1,045 |
|
|
|
128 |
|
|
|
1,936 |
|
|
|
129 |
|
| Amortization of deferred
financing costs |
|
1,361 |
|
|
|
4,514 |
|
|
|
2,836 |
|
|
|
6,093 |
|
| Amortization of original issue
premium on repurchase of notes |
|
- |
|
|
|
446 |
|
|
|
- |
|
|
|
326 |
|
| Amortization of intangible
liabilities-charter agreements |
|
(1,681 |
) |
|
|
(10,565 |
) |
|
|
(5,045 |
) |
|
|
(23,420 |
) |
| Fair value adjustment on
derivative asset |
|
(1,417 |
) |
|
|
(2,084 |
) |
|
|
1,368 |
|
|
|
(6,648 |
) |
| Prepayment fees on debt
repayment |
|
- |
|
|
|
11,229 |
|
|
|
- |
|
|
|
15,197 |
|
| Stock-based compensation
expense |
|
2,505 |
|
|
|
2,231 |
|
|
|
5,179 |
|
|
|
5,661 |
|
| Changes in operating
assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
| Decrease/(increase) in
accounts receivable and other assets |
$ |
3,893 |
|
|
$ |
(4,350 |
) |
|
$ |
(2,462 |
) |
|
$ |
(6,184 |
) |
| Increase in inventories |
|
(1,855 |
) |
|
|
(968 |
) |
|
|
(1,162 |
) |
|
|
(543 |
) |
| Increase in derivative
asset |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(15,370 |
) |
| (Decrease)/increase in
accounts payable and other liabilities |
|
(1,090 |
) |
|
|
4,839 |
|
|
|
(10,668 |
) |
|
|
(1,015 |
) |
| Decrease in related parties'
balances, net |
|
890 |
|
|
|
3,311 |
|
|
|
745 |
|
|
|
2,183 |
|
| Increase in deferred
revenue |
|
4,028 |
|
|
|
2,109 |
|
|
|
12,240 |
|
|
|
607 |
|
| Unrealized foreign exchange
loss |
|
1 |
|
|
|
2 |
|
|
|
1 |
|
|
|
4 |
|
| Net cash provided by
operating activities |
$ |
107,491 |
|
|
$ |
86,850 |
|
|
$ |
200,528 |
|
|
$ |
143,070 |
|
| Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
|
|
|
| Acquisition of vessels |
$ |
(123,300 |
) |
|
$ |
- |
|
|
$ |
(123,300 |
) |
|
$ |
- |
|
| Cash paid for vessel
expenditures |
|
(3,369 |
) |
|
|
(1,238 |
) |
|
|
(4,551 |
) |
|
|
(3,225 |
) |
| Advances for vessel
acquisitions and other additions |
|
(2,713 |
) |
|
|
(1,202 |
) |
|
|
(5,945 |
) |
|
|
(2,324 |
) |
| Cash paid for drydockings |
|
(11,995 |
) |
|
|
(5,938 |
) |
|
|
(18,300 |
) |
|
|
(15,253 |
) |
| Net proceeds from sale of
vessel |
|
- |
|
|
|
- |
|
|
|
5,940 |
|
|
|
- |
|
| Time deposits
(acquired)/withdrawal |
|
(3,000 |
) |
|
|
100 |
|
|
|
(4,050 |
) |
|
|
100 |
|
| Net cash used in
investing activities |
$ |
(144,377 |
) |
|
$ |
(8,278 |
) |
|
$ |
(150,206 |
) |
|
$ |
(20,702 |
) |
| Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
|
|
|
| Repurchase of 2024 Notes,
including premium |
$ |
- |
|
|
$ |
(29,070 |
) |
|
$ |
- |
|
|
$ |
(29,070 |
) |
| Proceeds from drawdown of
credit facilities |
|
76,000 |
|
|
|
- |
|
|
|
76,000 |
|
|
|
60,000 |
|
| Proceeds from 2027 USPP
Notes |
|
- |
|
|
|
350,000 |
|
|
|
- |
|
|
|
350,000 |
|
| Repayment of credit
facilities/sale and leaseback |
|
(47,215 |
) |
|
|
(39,007 |
) |
|
|
(100,271 |
) |
|
|
(79,918 |
) |
| Repayment of refinanced debt,
including prepayment fees |
|
- |
|
|
|
(246,498 |
) |
|
|
- |
|
|
|
(276,671 |
) |
| Deferred financing costs
paid |
|
(1,140 |
) |
|
|
(7,018 |
) |
|
|
(1,140 |
) |
|
|
(9,264 |
) |
| Cancellation of Class A common
shares |
|
(6,992 |
) |
|
|
(4,925 |
) |
|
|
(16,980 |
) |
|
|
(4,925 |
) |
| Class A common shares-dividend
paid |
|
(13,340 |
) |
|
|
(13,836 |
) |
|
|
(26,691 |
) |
|
|
(23,093 |
) |
| Series B preferred
shares-dividend paid |
|
(2,384 |
) |
|
|
(2,384 |
) |
|
|
(4,768 |
) |
|
|
(4,768 |
) |
| Net cash provided
by/(used in) financing activities |
$ |
4,929 |
|
|
$ |
7,262 |
|
|
$ |
(73,850 |
) |
|
$ |
(17,709 |
) |
| Net
(decrease)/increase in cash and cash equivalents and restricted
cash |
|
(31,957 |
) |
|
|
85,834 |
|
|
|
(23,528 |
) |
|
|
104,659 |
|
| Cash and cash equivalents and
restricted cash at beginning of the period |
|
278,359 |
|
|
|
214,467 |
|
|
|
269,930 |
|
|
|
195,642 |
|
| Cash and cash
equivalents and restricted cash at end of the period |
$ |
246,402 |
|
|
$ |
300,301 |
|
|
$ |
246,402 |
|
|
$ |
300,301 |
|
| Supplementary Cash
Flow Information: |
|
|
|
|
|
|
|
|
|
|
|
| Cash paid for interest |
|
16,875 |
|
|
|
12,708 |
|
|
|
33,329 |
|
|
|
25,297 |
|
| Cash received from interest
rate caps |
|
8,839 |
|
|
|
254 |
|
|
|
15,916 |
|
|
|
254 |
|
| Non-cash investing
activities: |
|
|
|
|
|
|
|
|
|
|
|
| Unpaid capitalized
expenses |
|
11,997 |
|
|
|
8,101 |
|
|
|
11,997 |
|
|
|
8,101 |
|
| Unpaid drydocking
expenses |
|
16,199 |
|
|
|
7,417 |
|
|
|
16,199 |
|
|
|
7,417 |
|
| Non-cash financing
activities: |
|
|
|
|
|
|
|
|
|
|
|
| Unpaid deferred financing
costs |
|
- |
|
|
|
341 |
|
|
|
- |
|
|
|
341 |
|
| Unrealized gain/(loss) on
derivative assets |
|
2,803 |
|
|
|
5,632 |
|
|
|
(5,231 |
) |
|
|
22,914 |
|
Investor and Media Contacts: The IGB GroupBryan
Degnan646-673-9701orLeon Berman 212-477-8438
Global Ship Lease (NYSE:GSL)
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Global Ship Lease (NYSE:GSL)
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From Apr 2023 to Apr 2024
