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,
2021.
Fourth Quarter 2021 Financial
Highlights:
- Total net revenues
of $38.3 million. Net income and net income attributable to common
shareholders of $22.7 million or $3.14 and $3.13 earnings per share
basic and diluted, respectively. Adjusted net income attributable
to common shareholders1 for the period was $22.9 million or $3.18
and $3.17 per share basic and diluted, respectively.
- Adjusted
EBITDA1 was $26.1 million.
- An average of 15.01
vessels were owned and operated during the fourth quarter of 2021
earning an average time charter equivalent rate of $29,994 per
day.
Full Year 2021 Highlights:
- Total net revenues of $93.9
million. Net income of $42.9 million; net income attributable to
common shareholders (after a $0.3 million dividend on Series B
Preferred Shares and a $0.3 million of preferred deemed dividend
arising out of the redemption of approximately $8.4 million of
Series B Preferred Shares in the first half of 2021) of $42.3
million or $6.06 and $6.05 earnings per share basic and diluted,
respectively. Adjusted net income attributable to common
shareholders1 for the period was $42.0 million or $6.02 and $6.01
per share basic and diluted, respectively.
- Adjusted EBITDA1 was $52.7
million.
- An average of 14.25 vessels were
owned and operated during the year 2021, earning an average time
charter equivalent rate of $19,309 per day.
Recent developments
- On January 28,
2022, we signed a contract for the construction of two additional
Eco design fuel efficient containerships. The vessels will have a
carrying capacity of about 2,800 teu each and will be built at
Hyundai Mipo Dockyard Co. in South Korea. The two newbuildings are
scheduled to be delivered during the fourth quarter of 2023 and
first quarter of 2024, respectively. The total consideration for
each of these two newbuilding contracts is approximately $43.15
million and will be financed with a combination of debt and equity.
The vessels are sisterships of a pair of vessels ordered by
Euroseas Ltd. in June 2021.
_____________________________________________1Adjusted EBITDA,
Adjusted net income and Adjusted earnings 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: “The
fourth quarter of 2021 was a seminal one for Euroseas as we
recorded the highest net income level in our history of about $22.7
million. At the same time, we have chartered about 92% of our
available capacity in 2022, about 62% of our available capacity in
2023, and even about 40% of our available days in 2024. The high
level of our contracted revenues secures extremely high
profitability levels for Euroseas over the next two to three
years.”
“In light of the increased environmental
regulation that would reduce -on average- the transportation
capacity of the existing fleet, we have shifted our strategic focus
on how to position Euroseas post-pandemic and beyond. In this
context, in January 2022, we placed an order for two more 2,800 teu
vessels that we expect to have delivered in the fourth quarter of
2023 and first quarter of 2024. This brings our newbuilding program
to four vessels and solidifies our market presence in the large eco
feeder sector.”
“The retreat of the containerships rates during
November and December 2021 proved to be short-lived. With the turn
of the year, containership rates started increasing again and have
returned to -and for some segments exceeded- the record high levels
set only four months ago in October 2021. We are quite optimistic
about the strength of the market over the next couple of years
despite the expected easing of the inefficiencies in ports, due to
the limited deliveries in the near term and the constraints on
effective fleet supply of the emissions regulations from 2023
onwards alongside trade growth which has rebounded from the
pandemic lows. We continuously monitor market developments and
evaluate investment opportunities focusing on creating consistent
returns for our shareholders and exploiting our public listing and
increasing liquidity position.”
Tasos Aslidis, Chief Financial Officer
of Euroseas commented: “The operating results of the
fourth quarter of 2021 reflect the increased levels of charter
rates in the containership markets as compared to the same period
of 2020, with net income amounting to $22.7 million for the fourth
quarter in 2021 compared to a net income of $0.6 million for the
fourth quarter of 2020. On average, during the fourth quarter of
2021, our vessels earned approximately 185.7% higher time charter
equivalent rates compared to the fourth quarter of 2020.”
“Total daily vessel operating expenses,
including management fees, general and administrative expenses, but
excluding drydocking costs, were higher by 7.6% during the fourth
quarter of 2021 compared to the same quarter of last year. The
increased operating expenses for the fourth quarter of 2021 are
mainly due to higher hull and machinery insurance premiums and the
increased crewing costs for our vessels resulting from difficulties
in crew rotation due to COVID-19 related restrictions. Adjusted
EBITDA during the fourth quarter of 2021 was $26.1 million compared
to the $2.1 million achieved in fourth quarter of last year, and it
reached $52.7 million versus $11.8 million for the respective
twelve-month periods of 2021 and 2020.”
“As of December 31, 2021, our outstanding bank
debt (excluding the unamortized loan fees) was $119.0 million,
versus restricted and unrestricted cash of approximately $31.5
million. As of the same date, our scheduled debt repayments over
the next 12 months amounted to about $29.3 million (excluding the
unamortized loan fees).”
Fourth Quarter 2021 Results:For
the fourth quarter of 2021, the Company reported total net revenues
of $38.3 million representing a 217.9% increase over total net
revenues of $12.0 million during the fourth quarter of 2020, which
was the result of the increased average time charter rates our
vessels earned in the fourth quarter of 2021 compared to the
corresponding period of 2020. The Company reported net income and
net income attributable to common shareholders for the period of
$22.7 million, as compared to a net income of $0.6 million and a
net income attributable to common shareholders of $0.4 million for
the fourth quarter of 2020.
Vessel operating expenses for the same period of
2021 amounted to $8.3 million as compared to $7.5 million for the
same period of 2020. The increased amount is mainly due to the
higher number of vessels owned and operated in the three months of
2021 compared to the same period of 2020, as well as the increased
crewing costs for our vessels compared to the same period of 2020,
resulting from difficulties in crew rotation due to COVID-19
related restrictions and the increase in hull and machinery
insurance premiums. Drydocking expenses amounted to $1.2 million
during the fourth quarter of 2021 comprising the cost of one vessel
completing her special survey with drydock. For the same period of
2020 drydocking expenses amounted to $0.1 million comprising the
cost of one vessel completing her intermediate survey in-water.
Depreciation expense for the fourth quarter of 2021 increased to
$2.4 million from $1.6 million in the fourth quarter of 2020, as a
result of the increased number of vessels operated and the fact
that the new vessels acquired in the fourth quarter of 2021 have a
higher average daily depreciation charge as a result of their
higher acquisition price compared to the remaining vessels. General
and administrative expenses increased to $1.2 million in the fourth
quarter of 2021, as compared to $0.8 million in the fourth quarter
of 2020, mainly due to higher executive compensation expenses.
On average, 15.01 vessels were owned and
operated during the fourth quarter of 2021 earning an average time
charter equivalent rate of $29,994 per day compared to 14.43
vessels in the same period of 2020 earning on average $10,497 per
day.
Interest and other financing costs for the
fourth quarter of 2021 amounted to $0.78 million compared to $0.81
million for the same period of 2020. This decrease is due to the
decrease in the weighted average LIBOR rate, partly offset by the
increase in the Company’s average outstanding indebtedness in the
current period compared to the same period of 2020.
Adjusted EBITDA1 for the fourth quarter of 2021
was $26.1 million compared to $2.1 million for the corresponding
period in 2020.
Basic and diluted earnings per share
attributable to common shareholders for the fourth quarter of 2021
was $3.14 and $3.13 calculated on 7,210,466 and 7,244,042 basic and
diluted weighted average number of shares outstanding,
respectively, compared to basic and diluted earnings per share of
$0.07 for the fourth quarter of 2020, calculated on 6,149,300 basic
and diluted weighted average number of shares
outstanding.
Excluding the effect on the income attributable
to common shareholders for the quarter of the unrealized loss on
derivatives, the amortization of below market time charters
acquired and the depreciation charged due to the increased value of
the vessel acquired with below market time charter, the adjusted
earnings attributable to common shareholders for the quarter ended
December 31, 2021 would have been $3.18 and $3.17 per share basic
and diluted, respectively, compared to an adjusted loss of $0.16
per share basic and diluted for the quarter ended December 31,
2020, after excluding unrealized gain on derivatives, net gain on
sale of vessels, the amortization of below market time charters
acquired and the depreciation charged due to the increased value of
the vessels acquired with below market time charters. Usually,
security analysts do not include the above items in their published
estimates of earnings per share.
Full Year 2021 Results:For the
full year of 2021, the Company reported total net revenues of $93.9
million, representing a 76.2% increase, over total net revenues of
$53.3 million during the twelve months of 2020. The Company
reported a net income for the year of $42.9 million and a net
income attributable to common shareholders of $42.3 million, as
compared to a net income of $4.0 million and a net income
attributable to common shareholders of $3.3 million for the twelve
months of 2020. The results for the twelve months of 2021 include a
$0.2 million of amortization of below market time charters acquired
and a $0.2 million unrealized gain on derivatives. The results for
the twelve months of 2020 included a $1.7 million of amortization
of below market time charters acquired, a $0.6 million unrealized
loss on derivatives, a $2.5 million net gain on sale of vessels and
a $0.1 million loss on write-down of vessel held for sale.
Vessel operating expenses for the twelve months
of 2021 amounted to $29.7 million as compared to $32.2 million for
the same period of 2020. This decrease in vessel operating expenses
is due to the lower average number of vessels operated by the
Company in the twelve months of 2021 as compared to the same period
of 2020, partly offset by the increased crewing costs for our
vessels compared to the same period of 2020, resulting from
difficulties in crew rotation due to COVID-19 related restrictions
and the increase in hull and machinery insurance premiums.
Depreciation expense for the twelve months of 2021 was $7.2 million
compared to $6.6 million during the same period of 2020. Although
the average number of vessels operating decreased in 2021 as
compared to the same period of 2020, the new vessels acquired in
the fourth quarter of 2021 have a higher average daily depreciation
charge as a result of their higher acquisition price compared to
the vessels sold during 2020, some of which were also fully
depreciated.
Related party management fees for the twelve
months of 2021 were $4.3 million compared to $5.3 million for the
same period of 2020. This decrease in related party management fees
is due to the lower average number of vessels operated by the
Company in the twelve months of 2021 as compared to the same period
of 2020, as well as due to termination fees paid in 2020 for the
vessels sold during last year, in accordance with the management
agreement. General and administrative expenses increased to $3.5
million during the twelve months of 2021 as compared to $3.0
million in the last year, mainly due to higher executive
compensation expenses.
Drydocking expenses amounted to $4.1 million for
the twelve months of 2021 (three vessels passed their special
survey with drydock), compared to $0.5 million for the same period
of 2020 (one vessel passed her intermediate survey in-water and
three vessels passed their special survey in-water).
On average, 14.25 vessels were owned and
operated during the twelve months of 2021 earning an average time
charter equivalent rate of $19,309 per day compared to 17.23
vessels in the same period of 2020 earning on average $9,445 per
day.
Interest and other financing costs for the
twelve months of 2021 amounted to $2.8 million compared to
$4.1million for the same period of 2020. This decrease is due to
the decrease in the weighted average LIBOR rate, partly offset by
the increase in the Company’s average outstanding indebtedness in
the current period compared to the same period of 2020.
Adjusted EBITDA1 for the twelve months of 2021
was $52.7 million compared to $11.8 million during the twelve
months of 2020.
Basic and diluted earnings per share
attributable to common shareholders for the twelve months of 2021
was $6.06 and $6.05, calculated on 6,976,905 and 6,993,405 basic
and diluted weighted average number of shares outstanding,
respectively, compared to basic and diluted earnings per share of
$0.58 for the twelve months of 2020, calculated on 5,753,917 basic
and diluted weighted average number of shares
outstanding.
Excluding the effect on the income attributable
to common shareholders for the twelve months of 2021 of the
unrealized gain on derivatives, the amortization of the below
market time charters acquired, the depreciation charged due to the
increased value of the vessel acquired with below market time
charter and the net loss on sale of vessel, the adjusted earnings
attributable to common shareholders for the year ended December 31,
2021 would have been $6.02 and $6.01 basic and diluted,
respectively, compared to adjusted loss of $0.02 per share basic
and diluted for 2020, after excluding unrealized loss on
derivatives, net gain on sale of vessels, loss on write down of
vessel held for sale, amortization of the below market time
charters acquired and the depreciation charged due to the increased
value of the vessels acquired with below market time charters. As
previously mentioned, usually, security analysts do not include the
above items in their published estimates of earnings per share.
Fleet Profile:
The Euroseas Ltd. fleet profile is as follows:
|
Name |
Type |
Dwt |
TEU |
Year Built |
Employment(*) |
TCE Rate ($/day) |
|
Container Carriers |
|
|
|
|
|
|
|
MARCOS V |
Intermediate |
72,968 |
6,350 |
2005 |
TC until Dec-24plus 12 months option |
$42,200option $15,000 |
|
AKINADA BRIDGE (*) |
Intermediate |
71,366 |
5,610 |
2001 |
TC until Oct-22 |
$20,000 |
|
SYNERGY BUSAN (*) |
Intermediate |
50,726 |
4,253 |
2009 |
TC until Aug-24 |
$25,000 |
|
SYNERGY ANTWERP (+) |
Intermediate |
50,726 |
4,253 |
2008 |
TC until Dec-23 |
$18,000 |
|
SYNERGY OAKLAND (*) |
Intermediate |
50,787 |
4,253 |
2009 |
TC until Apr-22 then until Mar-26 |
$160,000 (***)$42,000 |
|
SYNERGY KEELUNG (+) |
Intermediate |
50,969 |
4,253 |
2009 |
TC until Jun-22 plus 8-12 months option |
$11,750 option $14,500 |
|
EM KEA (*) |
Feeder |
42,165 |
3,100 |
2007 |
TC until May-23 |
$22,000 |
|
EM ASTORIA (+) |
Feeder |
35,600 |
2,788 |
2004 |
TC until Feb-22then until Feb-23then until Feb-24then until
Feb-25 |
$18,650$65,000$50,000$20,000 |
|
EVRIDIKI G (*) |
Feeder |
34,677 |
2,556 |
2001 |
TC until Feb-25 |
$40,000 |
|
EM CORFU (*) |
Feeder |
34,654 |
2,556 |
2001 |
TC until Feb-25 |
$40,000 |
|
DIAMANTIS P (*) |
Feeder |
30,360 |
2,008 |
1998 |
TC until Oct-24 |
$27,000 |
|
EM SPETSES (*) |
Feeder |
23,224 |
1,740 |
2007 |
TC until Aug-24 |
$29,500 |
|
JONATHAN P (*) |
Feeder |
23,351 |
1,740 |
2006 |
TC until Sep-24 |
$26,662(**) |
|
EM HYDRA (*) |
Feeder |
23,351 |
1,740 |
2005 |
TC until Apr-23 |
$20,000 |
|
JOANNA (*) |
Feeder |
22,301 |
1,732 |
1999 |
TC until Oct-22 |
$16,800 |
|
AEGEAN EXPRESS (*) |
Feeder |
18,581 |
1,439 |
1997 |
TC until Mar-22 |
$11,500 |
|
Total Container Carriers |
16 |
635,806 |
50,371 |
|
|
|
|
Vessels under construction |
Type |
Dwt |
TEU |
To be delivered |
|
H4201 |
Feeder |
37,237 |
2,800 |
Q1 2023 |
|
H4202 |
Feeder |
37,237 |
2,800 |
Q2 2023 |
|
H4236 |
Feeder |
37,237 |
2,800 |
Q4 2023 |
|
H4237 |
Feeder |
37,237 |
2,800 |
Q1 2024 |
Notes:
(*) TC denotes time charter. All dates listed
are the earliest redelivery dates under each time charter 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 (+).
(**) Rate is net of commissions (which are
typically 5-6.25%)
(***) The previous charter of M/V Synergy
Oakland of $202,000/day exceeded its maximum duration by about 25
days due to port delays with payment of the higher ($202,000/day)
rate to the Company continuing during the extension. However, the
extension resulted in the loss of the subsequent short-term charter
of $130,000/day that was to be performed before the 4-year charter
starts. The vessel, after an idle period of 15 days, was chartered
for a single voyage charter at $160,000/day after the completion of
which it will commence the 4-yr charter; the new charter
arrangements will result in about the same average rate and total
revenues as the original arrangements.
Summary Fleet Data:
|
|
Three Months, Ended December 31,
2020 |
Three Months, Ended December 31,
2021 |
Twelve Months, Ended December 31,
2020 |
Twelve Months,
Ended December 31, 2021 |
|
FLEET DATA |
|
|
|
|
|
Average number of vessels (1) |
14.43 |
15.01 |
17.23 |
14.25 |
|
Calendar days for fleet (2) |
1,328.0 |
1,381.0 |
6,306.0 |
5,203.0 |
|
Scheduled off-hire days incl. laid-up (3) |
73.1 |
31.1 |
283.4 |
88.4 |
|
Available days for fleet (4) = (2) - (3) |
1,254.9 |
1,349.9 |
6,022.6 |
5,114.6 |
|
Commercial off-hire days (5) |
18.5 |
- |
150.6 |
- |
|
Operational off-hire days (6) |
46.6 |
20.5 |
118.1 |
77.2 |
|
Voyage days for fleet (7) = (4) - (5) - (6) |
1,189.8 |
1,329.4 |
5,753.9 |
5,037.4 |
|
Fleet utilization (8) = (7) / (4) |
94.8% |
98.5% |
95.5% |
98.5% |
|
Fleet utilization, commercial (9) = ((4) - (5)) / (4) |
98.5% |
100.0% |
97.5% |
100.0% |
|
Fleet utilization, operational (10) = ((4) - (6)) / (4) |
96.3% |
98.5% |
98.0% |
98.5% |
|
|
|
|
|
|
|
AVERAGE DAILY RESULTS (usd/day) |
|
|
|
|
|
Time charter equivalent rate (11) |
10,497 |
29,994 |
9,445 |
19,309 |
|
Vessel operating expenses excl. drydocking expenses (12) |
6,586 |
6,807 |
5,949 |
6,541 |
|
General and administrative expenses (13) |
578 |
901 |
482 |
671 |
|
Total vessel operating expenses (14) |
7,164 |
7,708 |
6,431 |
7,212 |
|
Drydocking expenses (15) |
75 |
866 |
85 |
787 |
(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, vessels committed for sale or vessels that
suffered unrepaired damages, are days associated with scheduled
repairs, drydockings or special or intermediate surveys or days of
vessels in lay-up, or with vessels that were committed for sale or
suffered unrepaired damages.
(4) Available days. We define available days as
the Calendar days in a period net of scheduled off-hire days as
defined above. 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 rate, or TCE rate,
is a measure of the average daily net 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 and
related party management fees 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, Tuesday,
February 15, 2022 at 10:30 a.m. Eastern Standard 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.
Audio Webcast - Slides
Presentation: There will be a live and then archived
webcast of the conference call and accompanying slides, available
through the Company’s website. To listen to the archived audio
file, visit our website http://www.euroseas.gr and click on Company
Presentations under our Investor Relations page. Participants to
the live webcast should register on the website approximately 10
minutes prior to the start of the webcast.
The slide presentation on the fourth quarter
ended December 31, 2021 will also be available in PDF format
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 Months Ended December
31, |
Three Months Ended December
31, |
Twelve Months Ended December
31, |
Twelve Months Ended December
31, |
|
|
2020 |
2021 |
2020 |
2021 |
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
Time charter revenue |
12,532,549 |
39,999,276 |
55,681,124 |
97,979,667 |
|
Commissions |
(499,174) |
(1,745,138) |
(2,378,007) |
(4,085,717) |
|
|
|
|
|
|
|
Net revenues |
12,033,375 |
38,254,138 |
53,303,117 |
93,893,950 |
|
|
|
|
|
|
|
Operating expenses/ (income) |
|
|
|
|
|
Voyage expenses |
43,467 |
124,742 |
1,334,259 |
713,448 |
|
Vessel operating expenses |
7,501,283 |
8,307,463 |
32,219,689 |
29,739,437 |
|
Drydocking expenses |
99,093 |
1,195,712 |
536,199 |
4,094,693 |
|
Vessel depreciation |
1,604,139 |
2,413,569 |
6,605,976 |
7,203,198 |
|
Related party management fees |
1,244,394 |
1,093,684 |
5,293,199 |
4,294,789 |
|
Net (gain) / loss on sale of vessels |
(1,148,720) |
- |
(2,453,736) |
9,417 |
|
General and administrative expenses |
767,229 |
1,244,023 |
3,041,435 |
3,491,120 |
|
Other operating income |
- |
- |
(2,687,205) |
(1,298,318) |
|
Loss on write down of vessel held for sale |
- |
- |
121,165 |
- |
|
Total operating expenses, net |
10,110,885 |
14,379,193 |
44,010,981 |
48,247,784 |
|
|
|
|
|
|
|
Operating income |
1,922,490 |
23,874,945 |
9,292,136 |
45,646,166 |
|
|
|
|
|
|
|
Other (expenses)/ income |
|
|
|
|
|
Interest and other financing costs |
(805,076) |
(776,652) |
(4,125,150) |
(2,779,729) |
|
Loss on debt extinguishment |
(491,571) |
- |
(491,571) |
- |
|
Loss on derivatives, net |
(23,357) |
(448,449) |
(587,988) |
(27,141) |
|
Foreign exchange (loss) / gain |
(20,469) |
26,497 |
(63,007) |
34,418 |
|
Interest income |
820 |
541 |
17,011 |
3,510 |
|
Other expenses, net |
(1,339,653) |
(1,198,063) |
(5,250,705) |
(2,768,942) |
|
Net income |
582,837 |
22,676,882 |
4,041,431 |
42,877,224 |
|
Dividend Series B Preferred shares |
(168,676) |
- |
(693,297) |
(255,324) |
|
Preferred deemed dividend |
- |
- |
- |
(345,423) |
|
Net income attributable to common
shareholders |
414,161 |
22,676,882 |
3,348,134 |
42,276,477 |
|
Weighted average number of shares outstanding, basic |
6,149,300 |
7,210,466 |
5,753,917 |
6,976,905 |
|
Earnings per share attributable to common shareholders - basic |
0.07 |
3.14 |
0.58 |
6.06 |
|
Weighted average number of shares outstanding, diluted |
6,149,300 |
7,244,042 |
5,753,917 |
6,993,405 |
|
Earnings per share attributable to common shareholders -
diluted |
0.07 |
3.13 |
0.58 |
6.05 |
Euroseas Ltd., Unaudited
Consolidated Condensed Balance Sheets(All amounts
expressed in U.S. Dollars – except number of shares)
|
|
December 31, 2020 |
December 31, 2021 |
|
ASSETS |
(unaudited) |
| Current
Assets: |
|
|
|
Cash and cash equivalents |
3,559,399 |
26,530,944 |
|
Trade accounts receivable, net |
2,013,023 |
1,274,729 |
|
Other receivables |
1,866,624 |
1,722,885 |
|
Inventories |
1,662,422 |
2,185,740 |
|
Restricted cash |
345,010 |
167,285 |
|
Prepaid expenses |
244,315 |
382,729 |
|
Derivatives |
- |
540,753 |
| Total
current assets |
9,690,793 |
32,805,065 |
| |
|
|
| Fixed
assets: |
|
|
|
Vessels, net |
98,458,447 |
176,286,989 |
| Long-term
assets: |
|
|
|
Advances for vessels under construction |
- |
7,615,958 |
|
Restricted cash |
2,433,768 |
4,800,000 |
| Total
assets |
110,583,008 |
221,508,012 |
| |
|
|
|
LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’
EQUITY |
|
|
| Current
liabilities: |
|
|
|
Long-term bank loans, current portion |
20,645,320 |
29,034,049 |
|
Related party loan, current |
2,500,000 |
- |
|
Trade accounts payable |
2,854,377 |
2,804,194 |
|
Accrued expenses |
1,300,420 |
1,702,925 |
|
Accrued preferred dividends |
168,676 |
- |
|
Deferred revenue |
949,364 |
3,293,986 |
|
Derivatives |
203,553 |
- |
|
Due to related company |
24,072 |
309,969 |
| Total
current liabilities |
28,645,782 |
37,145,123 |
| Long-term
liabilities: |
|
|
|
Long -term bank loans, net of current portion |
46,220,028 |
89,004,951 |
|
Derivatives |
362,195 |
952,666 |
|
Fair value of below market time charters acquired |
- |
17,634,812 |
| Total
long-term liabilities |
46,582,223 |
107,592,429 |
| Total
liabilities |
75,228,005 |
144,737,552 |
| Mezzanine
equity: |
|
|
|
Series B Preferred shares (par value $0.01, 20,000,000 shares
authorized, 8,000 and nil issued and outstanding,
respectively) |
8,019,636 |
- |
|
Shareholders’ equity: |
|
|
|
Common stock (par value $0.03, 200,000,000 shares authorized,
6,708,946 and 7,294,541 issued and outstanding, respectively) |
201,268 |
218,836 |
|
Additional paid-in capital |
257,467,980 |
264,609,028 |
|
Accumulated deficit |
(230,333,881) |
(188,057,404) |
| Total
shareholders’ equity |
27,335,367 |
76,770,460 |
| Total
liabilities, mezzanine and shareholders' equity |
110,583,008 |
221,508,012 |
Euroseas Ltd. Unaudited
Consolidated Condensed Statements of Cash Flows
(All amounts expressed in U.S. Dollars)
|
|
Twelve Months Ended December 31, |
Twelve Months Ended December 31, |
|
2020 |
2021 |
|
|
|
|
|
Cash flows from operating activities: |
|
| Net
income |
4,041,431 |
42,877,224 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
Vessel depreciation |
6,605,976 |
7,203,198 |
|
Amortization and write off of deferred charges |
288,163 |
223,492 |
|
Share-based compensation |
121,631 |
182,324 |
| Gain on
hull & machinery claim |
(2,687,205) |
- |
| Net
(gain) / loss on sale of vessels |
(2,453,736) |
9,417 |
| Loss on
write down of vessel held for sale |
121,165 |
- |
|
Amortization of fair value of below market time charters
acquired |
(1,714,370) |
(232,390) |
|
Unrealized loss / (gain) on derivatives |
565,748 |
(153,835) |
| Loss on
debt extinguishment |
491,571 |
- |
|
Changes in operating assets and liabilities |
(2,950,997) |
2,517,236 |
|
Net cash provided by operating activities |
2,429,377 |
52,626,666 |
|
|
|
|
|
Cash flows from investing activities: |
|
|
| Cash
paid for vessels under construction |
- |
(7,615,958) |
| Cash
paid for vessel acquisitions and capitalized expenses |
- |
(65,523,144) |
| Cash
paid for vessel improvements |
(667,069) |
(974,058) |
| Proceeds
from sale of vessels |
14,622,768 |
- |
|
Insurance proceeds |
2,343,608 |
- |
|
Net cash provided by / (used in) investing
activities |
16,299,307 |
(74,113,160) |
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
Redemption of Series B preferred shares |
- |
(2,000,000) |
| Proceeds
from issuance of common stock, net of commissions paid |
715,550 |
743,553 |
|
Preferred dividends paid |
(320,877) |
(424,000) |
| Loan
arrangement fees paid |
- |
(758,000) |
| Offering
expenses paid |
(184,321) |
(123,167) |
| Proceeds
from long- term bank loans |
- |
75,500,000 |
|
Repayment of long-term bank loans |
(17,905,920) |
(23,791,840) |
|
Repayment of related party loan |
(625,000) |
(2,500,000) |
|
Net cash (used in) / provided by financing
activities |
(18,320,568) |
46,646,546 |
|
|
|
|
|
Net increase in cash, cash equivalents and restricted cash |
408,116 |
25,160,052 |
|
Cash, cash equivalents and restricted cash at beginning of
year |
5,930,061 |
6,338,177 |
|
Cash, cash equivalents and restricted cash at end of
year |
6,338,177 |
31,498,229 |
|
Cash breakdown |
|
|
| Cash and
cash equivalents |
3,559,399 |
26,530,944 |
|
Restricted cash, current |
345,010 |
167,285 |
|
Restricted cash, long term |
2,433,768 |
4,800,000 |
|
Total cash, cash equivalents and restricted cash shown in
the statement of cash flows |
6,338,177 |
31,498,229 |
Euroseas Ltd.
Reconciliation of Net income to Adjusted
EBITDA(All amounts expressed in U.S.
Dollars)
|
|
Three Months EndedDecember 31,
2020 |
Three Months EndedDecember 31,
2021 |
Twelve Months EndedDecember 31,
2020 |
Twelve Months EndedDecember 31,
2021 |
|
Net income |
582,837 |
22,676,882 |
4,041,431 |
42,877,224 |
|
Interest and other financing costs, net (incl. interest income and
loss on debt extinguishment) |
1,295,827 |
776,111 |
4,599,710 |
2,776,219 |
|
Vessel depreciation |
1,604,139 |
2,413,569 |
6,605,976 |
7,203,198 |
|
Net (gain) / loss on sale of vessels |
(1,148,720) |
- |
(2,453,736) |
9,417 |
|
Loss on write down of vessel held for sale |
- |
- |
121,165 |
- |
|
Amortization of below market time charters acquired |
(240,639) |
(232,390) |
(1,714,370) |
(232,390) |
|
Loss on interest rate swap derivatives |
23,357 |
448,449 |
587,988 |
27,141 |
|
Adjusted EBITDA |
2,116,801 |
26,082,621 |
11,788,164 |
52,660,809 |
Adjusted EBITDA
Reconciliation:Euroseas Ltd. considers Adjusted EBITDA to
represent net income before interest, income taxes, depreciation,
loss on interest rate swap derivatives, net (gain) / loss on sale
of vessels, amortization of below market time charters acquired and
loss on write down of vessel held for sale. Adjusted EBITDA does
not represent and should not be considered as an alternative to net
income, 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, loss on
interest rate swaps, net (gain) / loss on sale of vessels, loss on
write down of vessel held for sale 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 income to Adjusted net (loss) /
income(All amounts expressed in U.S. Dollars –
except share data and number of shares)
|
|
Three Months EndedDecember 31,
2020 |
Three Months EndedDecember 31,
2021 |
Twelve
Months EndedDecember 31,
2020 |
Twelve Months EndedDecember 31,
2021 |
|
Net income |
582,837 |
22,676,882 |
4,041,431 |
42,877,224 |
|
Unrealized (gain) / loss on derivatives |
(17,102) |
398,797 |
565,748 |
(153,835) |
|
Net (gain)/ loss on sale of vessels |
(1,148,720) |
- |
(2,453,736) |
9,417 |
|
Loss on write down of vessel held for sale |
- |
- |
121,165 |
- |
|
Amortization of below market time charters acquired |
(240,639) |
(232,390) |
(1,714,370) |
(232,390) |
|
Depreciation charged due to increase in vessel value from below
market time charter acquired |
24,455 |
99,941 |
125,403 |
99,941 |
|
Adjusted net (loss) / income |
(799,169) |
22,943,230 |
685,641 |
42,600,357 |
|
Preferred dividends |
(168,676) |
- |
(693,297) |
(255,324) |
|
Preferred deemed dividend |
- |
- |
- |
(345,423) |
|
Adjusted net (loss) / income attributable to common
shareholders |
(967,845) |
22,943,230 |
(7,656) |
41,999,610 |
|
Adjusted (loss) / earnings per share, basic |
(0.16) |
3.18 |
(0.00) |
6.02 |
|
Weighted average number of shares, basic |
6,149,300 |
7,210,466 |
5,753,917 |
6,976,905 |
|
Adjusted (loss) / earnings per share, diluted |
(0.16) |
3.17 |
(0.00) |
6.01 |
|
Weighted average number of shares, diluted |
6,149,300 |
7,244,042 |
5,753,917 |
6,993,405 |
Adjusted net (loss) / income and
Adjusted (loss) / earnings per share
Reconciliation:Euroseas Ltd. considers Adjusted net (loss)
/ income to represent net (loss) / income before unrealized (gain)
/ loss on derivatives, net (gain) / loss on sale of vessels, loss
on write down of vessel held for sale, amortization of below market
time charters acquired, and depreciation charged due to increase in
vessel value from below market time charter acquired. Adjusted net
(loss) / income and Adjusted (loss) / earnings 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)
/ loss on derivatives, net (gain) / loss on sale of vessels, loss
on write down of vessel held for sale, amortization of below market
time charters acquired and depreciation charged due to increase in
vessel value from below market time charter acquired, which items
may significantly affect results of operations between
periods.
Adjusted net (loss) / income and Adjusted (loss)
/ earnings per share do not represent and should not be considered
as an alternative to net income or earnings per share, as
determined by GAAP. The Company's definition of Adjusted net (loss)
/ income and Adjusted (loss) / earnings 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 16 vessels, including
10 Feeder containerships and 6 Intermediate Container carriers.
Euroseas 16 containerships have a cargo capacity of 50,371 teu.
After the delivery of four feeder containership newbuildings in
2023 and the first half of 2024, Euroseas’ fleet will consist of 20
vessels with a total carrying capacity of 61,571 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 BornozisMarkella KaraCapital Link, Inc.230 Park Avenue,
Suite 1536New York, NY 10169Tel. (212) 661-7566E-mail:
euroseas@capitallink.com |
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