ATHENS, Greece, Jan. 26, 2016 /PRNewswire/ -- Paragon Shipping
Inc. (NASDAQ: PRGN) ("Paragon Shipping" or the "Company"), a global
shipping transportation company specializing in drybulk cargoes,
announced today its results for the third quarter and nine months
ended September 30, 2015.
Third Quarter 2015 Highlights & Recent
Developments
- Net revenue, net of voyage expenses, of $6.4 million in the third quarter of 2015.
- Reduced average daily adjusted total vessel operating expenses
by 7.4% year-over-year.
- Adjusted EBITDA of negative $2.3
million in the third quarter of 2015.
- Adjusted net loss of $8.3
million, or $0.33 per common
share, in the third quarter of 2015.
Financial Highlights
(Expressed in thousands of United
States Dollars, except for vessel data, TCE and share data)
|
Quarter
Ended September 30,
2014
|
Quarter
Ended September 30,
2015
|
Nine Months
Ended September 30,
2014
|
Nine Months
Ended September 30,
2015
|
Average number of
vessels
|
14.0
|
13.1
|
14.0
|
15.0
|
Time charter
equivalent rate (TCE) (1)
|
6,570
|
5,508
|
7,645
|
5,252
|
Net Revenue, net
of voyage expenses
|
8,383
|
6,388
|
28,377
|
21,076
|
EBITDA
(1)
|
744
|
(5,579)
|
(20,466)
|
(72,665)
|
Adjusted EBITDA
(1)
|
673
|
(2,255)
|
1,888
|
(4,325)
|
Net
Loss
|
(6,037)
|
(13,369)
|
(41,574)
|
(95,207)
|
Adjusted Net Loss
(1)
|
(6,108)
|
(8,328)
|
(17,709)
|
(25,150)
|
Loss per common
share basic and diluted
|
(0.25)
|
(0.54)
|
(1.78)
|
(3.83)
|
Adjusted Loss per
common share basic and diluted (1)
|
(0.25)
|
(0.33)
|
(0.76)
|
(1.01)
|
|
|
(1)
|
Please see the table
at the back of this release for a reconciliation of TCE to Charter
Revenue, EBITDA and Adjusted EBITDA to Net Income / (Loss),
Adjusted Net Income / (Loss) to Net Income / (Loss) and Adjusted
Earnings / (Loss) per common share to Earnings / (Loss) per common
share, the most directly comparable financial measures calculated
and presented in accordance with generally accepted accounting
principles in the United States ("U.S. GAAP").
|
Third Quarter 2015 Financial Results
Gross charter
revenue for the third quarter of 2015 was $8.0 million, compared to $12.8 million for the third quarter of 2014. The
Company reported a net loss of $13.4
million, or $0.54 per basic
and diluted share, for the third quarter of 2015, calculated based
on a weighted average number of basic and diluted shares
outstanding for the period of 24,460,642 and reflecting the impact
of the non-cash items discussed below. For the third quarter of
2014, the Company reported a net loss of $6.0 million, or $0.25 per basic and diluted share, calculated
based on a weighted average number of basic and diluted shares of
24,253,142.
Excluding all non-cash items described below, the adjusted net
loss for the third quarter of 2015 was $8.3
million, or $0.33 per basic
and diluted share, compared to adjusted net loss of $6.1 million, or $0.25 per basic and diluted share, for the third
quarter of 2014.
Adjusted EBITDA, excluding all non-cash items described below,
was negative $2.3 million for the
third quarter of 2015, compared to positive $0.7 million for the third quarter of 2014.
The Company operated an average of 13.1 vessels during the third
quarter of 2015, earning an average TCE rate of $5,508 per day, compared to an average of 14.0
vessels during the third quarter of 2014, earning an average TCE
rate of $6,570 per day.
Adjusted total vessel operating expenses, which included vessel
operating expenses, management fees and general and administrative
expenses, and excluded share-based compensation, were $7.9 million for the third quarter of 2015,
compared to $8.3 million for the
third quarter of 2014. On a daily basis, adjusted total vessel
operating expenses for the third quarter of 2015 were approximately
$6,559 per vessel per day, compared
to $6,471 per vessel per day for the
third quarter of 2014.
The loss from sale of assets of $0.1
million for the three months ended September 30, 2015, relates to the loss from the
sale of the M/V Dream Seas, the M/V Gentle Seas, the M/V Peaceful
Seas and the M/V Friendly Seas, that was concluded on July 27, 2015.
Based on the Company's cash flow projections, it is probable
that cash on hand and cash provided by operating activities will
not be sufficient to cover the capital expenditures relating to the
Company's newbuilding contracts that become due in the twelve-month
period ending September 30, 2016.
Thus, as of September 30, 2015, the
Company assessed as probable the potential sale of the five
newbuilding contracts. As a result of this increased probability,
the Company recorded an impairment loss of $3.2 million for the three months ended
September 30, 2015, which relates to
the write down to fair value of the contract price of the five
newbuilding drybulk carriers.
Third Quarter 2015 Non-cash and One-off Items
The Company's results for the three months ended September 30, 2015 included the following
non-cash items:
- Impairment loss of $3.2 million,
or $0.13 per basic and diluted
share.
- Loss from sale of assets of $0.1
million, or less than $0.01
per basic and diluted share.
- Unrealized gain on interest rate swaps of $0.3 million, or $0.01 per basic and diluted share.
- Non-cash expenses of $0.3
million, or $0.01 per basic
and diluted share, relating to the amortization of the compensation
cost recognized for non-vested share awards issued to executive
officers, directors and employees.
- Write off of financing expenses of $1.7
million, or $0.07 per basic
and diluted share.
In the aggregate, these non-cash items decreased the Company's
earnings by $5.0 million, which
represents a $0.21 decrease in
earnings per basic and diluted share, for the three months ended
September 30, 2015.
Nine Months ended September 30,
2015 Financial Results
Gross charter revenue for the
nine months ended September 30, 2015
was $28.7 million, compared to
$41.7 million for the nine months
ended September 30, 2014. The Company
reported a net loss of $95.2 million,
or $3.83 per basic and diluted share,
for the nine months ended September 30,
2015, calculated based on a weighted average number of basic
and diluted shares outstanding for the period of 24,460,642 and
reflecting the impact of the non-cash items discussed below. For
the nine months ended September 30,
2014, the Company reported a net loss of $41.6 million, or $1.78 per basic and diluted share, calculated
based on a weighted average number of basic and diluted shares of
23,023,546.
Excluding all non-cash items described below, the adjusted net
loss for the nine months ended September 30,
2015 was $25.2 million, or
$1.01 per basic and diluted share,
compared to adjusted net loss of $17.7
million, or $0.76 per basic
and diluted share, for the nine months ended September 30, 2014.
Adjusted EBITDA, excluding all non-cash items described below,
was negative $4.3 million for the
nine months ended September 30, 2015,
compared to positive $1.9 million for
the nine months ended September 30,
2014.
The Company operated an average of 15.0 vessels during the nine
months ended September 30, 2015,
earning an average TCE rate of $5,252
per day, compared to an average of 14.0 vessels during the nine
months ended September 30, 2014,
earning an average TCE rate of $7,645
per day.
Adjusted total vessel operating expenses, which included vessel
operating expenses, management fees and general and administrative
expenses, and excluded share-based compensation, were $24.6 million for the nine months ended
September 30, 2015, compared to
$24.7 million for the nine months
ended September 30, 2014. On a daily
basis, adjusted total vessel operating expenses for the nine months
ended September 30, 2015 were
approximately $5,986 per vessel per
day, or 7.4% lower than the adjusted total vessel operating
expenses of $6,465 per vessel per day
for the nine months ended September 30,
2014. The reduction in the average daily adjusted total
vessel operating expenses is the result of the Company's cost
control efficiency and the economies of scale of operating an
increased average number of vessels for the first nine months of
2015, compared to the same period in 2014, as well as of a
favorable impact of the Euro / U.S. dollar exchange rate
fluctuations.
The loss related to assets held for sale of $47.6 million for the nine months ended
September 30, 2015, mainly relates to
the write down to fair value of the M/V Dream Seas, the M/V Gentle
Seas, the M/V Peaceful Seas and the M/V Friendly Seas, following
their classification as assets held for sale as of June 30, 2015.
The loss from sale of assets of $0.1
million for the three months ended September 30, 2015, relates to the loss from the
sale of the M/V Dream Seas, the M/V Gentle Seas, the M/V Peaceful
Seas and the M/V Friendly Seas, that was concluded on July 27, 2015.
Based on the Company's cash flow projections, it is probable
that cash on hand and cash provided by operating activities will
not be sufficient to cover the capital expenditures relating to the
Company's newbuilding contracts that become due in the twelve-month
period ending September 30, 2016.
Thus, as of June 30, 2015 and
September 30, 2015, the Company
assessed as probable the potential sale of the five newbuilding
contracts. As a result of this increased probability, the Company
recorded an aggregate impairment loss of $20.0 million for the nine months ended
September 30, 2015, which relates to
the write down to fair value of the contract price of the five
newbuilding drybulk carriers.
In the second quarter of 2015, the Company proceeded with the
sale of the total 3,437,500 shares of Box Ships Inc. (OTCQX:TEUFF)
("Box Ships") at an average sale price of $0.8542 per share, which resulted in a loss on
investment in affiliates of $0.2
million for the nine months ended September 30, 2015. The proceeds from the sale of
such shares amounted to $2.9
million.
Furthermore, in the second quarter of 2015, the Company
proceeded with the sale of the total 44,550 shares of Korea Line
Corporation ("KLC") at an average sale price of $21.68 per share. The total cash received from
the sale of these shares amounted to $1.0
million, net of commissions. A loss from marketable
securities, net, of $0.1 million was
recorded for the nine months ended September
30, 2015.
Nine Months ended September 30,
2015 Non-cash and One-off Items
The Company's results
for the nine months ended September 30,
2015 included the following non-cash items:
- Loss related to assets held for sale of $47.6 million, or $1.91 per basic and diluted share.
- Impairment loss of $20.0 million,
or $0.80 per basic and diluted
share.
- Loss from sale of assets of $0.1
million, or less than $0.01
per basic and diluted share.
- Loss from marketable securities of $0.1
million or $0.01 per basic and
diluted share.
- Loss on investment in affiliate of $0.2
million or $0.01 per basic and
diluted share.
- Unrealized gain on interest rate swaps of $0.5 million, or less than $0.02 per basic and diluted share.
- Non-cash expenses of $0.7
million, or $0.03 per basic
and diluted share, relating to the amortization of the compensation
cost recognized for non-vested share awards issued to executive
officers, directors and employees.
- Write off of financing expenses of $1.7
million, or $0.07 per basic
and diluted share.
In the aggregate, these non-cash items decreased the Company's
earnings by $70.1 million, which
represents a $2.82 decrease in
earnings per basic and diluted share, for the nine months ended
September 30, 2015.
Cash Flows
For the nine months ended September 30, 2015, the Company's net cash used
in operating activities was $5.7
million, compared to $3.7
million for the nine months ended September 30, 2014. For the nine months ended
September 30, 2015, net cash from
investing activities was $17.7
million and net cash used in financing activities was
$15.2 million. For the nine months
ended September 30, 2014, net cash
used in investing activities was $65.6
million and net cash from financing activities was
$57.0 million.
Liquidity
Given the current drybulk charter rates, it
is probable that the Company will not be in compliance with several
financial and security cover ratio covenants contained in certain
of its debt agreements on the next applicable measurement dates in
2015 and 2016. As a result of the cross default provisions included
in the Company's debt agreements, actual breaches existing under
its debt agreements could result in defaults under all of the
Company's debt and the acceleration of such debt by its lenders.
Furthermore, based on the Company's cash flow projections, cash on
hand and cash provided by operating activities will not be
sufficient to cover the liquidity needs that become due in the
twelve-month period ending September 30,
2016. In addition, on November 27,
2015, the scheduled quarterly installment initially amounted
to $480,500 and accrued loan interest
of $46,620, under the loan agreement
with Unicredit Bank AG, was not paid. In December 2015, Unicredit Bank AG gave notice to
the Company that the lender reserved its rights in connection with
any event of default under this loan agreement, and also released
$0.4 million of the then pledged cash
for working capital purposes. In January
2016, the Company entered into an agreement with its lender,
subject to definitive documentation, to restructure the respective
facility, as discussed below.
Subsequent to September 30, 2015,
the Company reached agreements for the extinguishment and
restructuring of its debt obligations with three of its lenders, as
discussed below. The Company is currently negotiating with the
remaining of its lenders to extend the existing waivers of the
affected covenants and to restructure the affected debt. The
Company is also exploring several alternatives aiming to manage its
working capital requirements and other commitments if current
drybulk charter rates remain at today's low levels, including
additional bank debt, future equity offerings and potential sale of
assets. If the Company is unable to arrange debt financing for its
newbuilding vessels or extend the respective deliveries from the
shipyards, it is probable that the Company may also consider
selling the respective newbuilding contracts.
Recent Fleet Developments
In connection with the
settlement agreement with Commerzbank AG dated December 8, 2015 discussed below, on November 9, 2015, the Company entered into
memoranda of agreement, as further supplemented and amended, for
the sale of three vessels of its operating fleet, the M/V Sapphire
Seas, the M/V Diamond Seas and the M/V Pearl Seas, to an unrelated
third party. The M/V Sapphire Seas and the M/V Diamond Seas were
delivered to their new owners in December
2015. The M/V Pearl Seas was delivered to her new owners in
January 2016.
In connection with the supplemental agreement with Bank of
Ireland dated January 7, 2016 discussed below, on December 1, 2015, the Company entered into a
memorandum of agreement for the sale of the M/V Kind Seas to an
unrelated third party. The M/V Kind Seas was delivered to her new
owners in January 2016.
On December 23 and December 30, 2015, the Company entered into
memoranda of agreement for the sale of the M/V Deep Seas and M/V
Calm Seas, respectively, to an unrelated third party. Both vessels
were delivered to their new owners in January 2016.
Financing Update
Commerzbank AG
On December 8, 2015, the Company
entered into an agreement with Commerzbank AG for the full and
final settlement of the outstanding principal amount of the
respective facility of $38.2 million.
According to the agreement, the facility will be settled with the
total net proceeds from the sale of the mortgaged vessels, namely
the M/V Sapphire Seas, the M/V Diamond Seas and the M/V Pearl Seas,
in line with the memoranda of agreement dated November 9, 2015, as discussed above. This will
result in an aggregate gain from debt extinguishment of
$26.5 million.
Bank of Ireland
On January 7, 2016, the Company
entered into an agreement with Bank of Ireland to apply the total net proceeds from
the sale of the M/V Kind Seas, in line with the memorandum of
agreement dated December 1, 2015
discussed above, towards the respective loan facility, while the
remaining principal amount of $4.4
million would be treated as follows: i) $2.2 million will be written-off, subject to
certain conditions, and ii) $2.2
million, plus any accrued interest, would be converted into
an unsecured paid-in-kind note ("PIK Note"). The conversion
occurred following the receipt of the net sale proceeds of the M/V
Kind Seas and the application of such proceeds against the
facility, in January 2016. The PIK
Note is non-amortizing and has a maturity date of December 31, 2020, at which time it will be
repaid at par. Interest on the PIK Note will accrue on a quarterly
basis at an interest rate equal to the aggregate of 2.5% and the
applicable LIBOR, and will be treated as payment-in-kind. Subject
to certain restrictions, the Company will have the option to
convert the PIK Note into its Class A common shares, partially or
wholly, at any time until the maturity date and based on the
twenty-day average closing price of the Company's shares
immediately prior to the conversion date.
Unicredit Bank AG
In January 2016, the Company
agreed with Unicredit Bank AG, subject to definitive documentation,
to apply the total net proceeds from the sale of the M/V Deep Seas
and the M/V Calm Seas, in line with the memoranda of agreement
dated December 23 and December 30, 2015 discussed above, towards the
respective loan facility upon the completion of the sale, while the
remaining principal amount of $8.3
million will be treated as follows: i) $4.9 million will be written-off, subject to
certain conditions, and ii) $3.4
million, plus any accrued interest, will be converted into
an unsecured PIK Note, with terms in line with those agreed with
Bank of Ireland discussed above.
The conversion will occur following the completion of the
definitive documentation, as well as the receipt of the net sale
proceeds of the M/V Deep Seas and the M/V Calm Seas, and the
application of such proceeds against the facility.
At-the-Market Offering of up to $4.0
million of Class A Common Shares
On September 4, 2015, the Company
entered into an equity distribution agreement with Maxim Group LLC
for the offer and sale of up to $4.0
million of its Class A common shares. The Company may offer
and sell the shares from time to time and at its discretion during
the next twelve months. The net proceeds of this offering are
expected to be used for general corporate purposes, which may
include the payment of a portion of the outstanding contractual
cost of the Company's existing newbuilding vessels, and the
repayment of debt. Under this offering, no shares were sold until
September 30, 2015, while in the
fourth quarter of 2015 the Company proceeded with the sale and
issuance of 359,543 Class A common shares, resulting in net
proceeds of $53,640.
About Paragon Shipping Inc.
Paragon Shipping is an international shipping company
incorporated under the laws of the Republic of the Marshall Islands with executive offices in
Athens, Greece, specializing in
the transportation of drybulk cargoes. Paragon Shipping's current
fleet consists of six drybulk vessels with a total carrying
capacity of 297,879 dwt. In addition, Paragon Shipping's current
newbuilding contracts consist of two Ultramax and three Kamsarmax
drybulk carriers with scheduled deliveries in the first quarter of
2016. The Company's common shares and senior notes trade on the
NASDAQ Capital Market under the symbols "PRGN" and "PRGNL,"
respectively. For more information, visit: www.paragonship.com. The
information contained on Paragon Shipping's website does not
constitute part of this press release.
Forward-Looking Statements
Certain statements in this press release are "forward-looking
statements" within the meaning of the Private Securities Litigation
Act of 1995. These forward-looking statements are based on our
current expectations and beliefs and are subject to a number of
risk factors and uncertainties that could cause actual results to
differ materially from those described in the forward-looking
statements. Such risks and uncertainties include, without
limitation, the strength of world economies and currencies, general
market conditions, including fluctuations in charter rates and
vessel values, changes in demand for drybulk shipping capacity,
changes in our operating expenses, including bunker prices,
dry-docking and insurance costs, the market for our vessels,
availability of financing and refinancing, charter counterparty
performance, ability to obtain financing and comply with covenants
in such financing arrangements, changes in governmental rules and
regulations or actions taken by regulatory authorities, potential
liability from pending or future litigation, general domestic and
international political conditions, potential disruption of
shipping routes due to accidents or political events, vessels
breakdowns and instances of off-hires and other factors, as well as
other risks that have been included in filings with the Securities
and Exchange Commission, all of which are available at
www.sec.gov.
Contacts:
Paragon Shipping Inc.
ir@paragonshipping.gr
DresnerAllenCaron
Rudy
Barrio (Investors)
rbarrio@dresnerallencaron.com
(212) 691-8087
- Tables Follow -
Fleet List
Drybulk Fleet
The following tables represent our drybulk fleet and the drybulk
newbuilding vessels that we have agreed to acquire as of
January 26, 2016.
Operating Drybulk
Fleet
|
Name
|
Type / No. of
Vessels
|
Dwt
|
Year
Built
|
Panamax
|
Coral
Seas
|
Panamax
|
74,477
|
2006
|
Golden
Seas
|
Panamax
|
74,475
|
2006
|
Total
Panamax
|
2
|
148,952
|
|
Handysize
|
|
|
|
Prosperous
Seas
|
Handysize
|
37,293
|
2012
|
Precious
Seas
|
Handysize
|
37,205
|
2012
|
Priceless
Seas
|
Handysize
|
37,202
|
2013
|
Proud
Seas
|
Handysize
|
37,227
|
2014
|
Total
Handysize
|
4
|
148,927
|
|
Grand
Total
|
6
|
297,879
|
|
Drybulk Newbuildings
that we have agreed to acquire
|
Hull
no.
|
Type / No. of
Vessels
|
Dwt
|
Expected
Delivery
|
Ultramax
|
Hull no.
DY4050
|
Ultramax
|
63,500
|
Q1 2016
|
Hull no.
DY4052
|
Ultramax
|
63,500
|
Q1 2016
|
Total
Ultramax
|
2
|
127,000
|
|
Kamsarmax
|
Hull no.
YZJ1144
|
Kamsarmax
|
81,800
|
Q1 2016
|
Hull no.
YZJ1145
|
Kamsarmax
|
81,800
|
Q1 2016
|
Hull no.
YZJ1142
|
Kamsarmax
|
81,800
|
Q1 2016
|
Total
Kamsarmax
|
3
|
245,400
|
|
Grand
Total
|
5
|
372,400
|
|
Summary Fleet
Data
(Expressed in
United States Dollars where applicable)
|
|
|
Quarter
Ended
September 30,
2014
|
Quarter
Ended
September 30,
2015
|
Nine Months Ended
September 30, 2014
|
Nine Months Ended
September 30, 2015
|
FLEET
DATA
|
Average number of
vessels (1)
|
14.0
|
13.1
|
14.0
|
15.0
|
Calendar days for
fleet (2)
|
1,288
|
1,208
|
3,816
|
4,104
|
Available days for
fleet (3)
|
1,288
|
1,187
|
3,755
|
4,065
|
Operating days for
fleet (4)
|
1,276
|
1,160
|
3,712
|
4,013
|
Fleet utilization
(5)
|
99.1%
|
97.7%
|
98.9%
|
98.7%
|
AVERAGE DAILY
RESULTS
|
Time charter
equivalent (6)
|
6,570
|
5,508
|
7,645
|
5,252
|
Vessel operating
expenses (7)
|
4,385
|
4,476
|
4,286
|
4,151
|
Management fees -
related party adjusted (8)
|
1,034
|
1,042
|
1,050
|
928
|
General and
administrative expenses adjusted (9)
|
1,052
|
1,041
|
1,129
|
907
|
Total vessel
operating expenses adjusted (10)
|
6,471
|
6,559
|
6,465
|
5,986
|
|
|
(1)
|
Average number of
vessels is the number of vessels that constituted our fleet for the
relevant period, as measured by the sum of the number of calendar
days each vessel was a part of our fleet during the period divided
by the number of days in the period.
|
(2)
|
Calendar days for the
fleet are the total days the vessels were in our possession for the
relevant period.
|
(3)
|
Available days for
the fleet are the total calendar days for the relevant period less
any off-hire days associated with scheduled dry-dockings or special
or intermediate surveys.
|
(4)
|
Operating days for
the fleet are the total available days for the relevant period less
any off-hire days due to any reason, other than scheduled
dry-dockings or special or intermediate surveys, including
unforeseen circumstances. Any idle days relating to the days a
vessel remains unemployed are included in operating
days.
|
(5)
|
Fleet utilization is
the percentage of time that our vessels were able to generate
revenues and is determined by dividing operating days by fleet
available days for the relevant period.
|
(6)
|
Time charter
equivalent ("TCE") is a measure of the average daily revenue
performance of a vessel on a per voyage basis. Our method of
calculating TCE is consistent with industry standards and is
determined by dividing Net Revenue generated from charters less
voyage expenses by operating days for the relevant time period.
Voyage expenses consist of all costs that are unique to a
particular voyage, primarily including port expenses, canal dues,
war risk insurances and fuel costs, net of gains or losses from the
sale of bunkers to charterers. TCE is a non-GAAP 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.
|
(7)
|
Daily vessel
operating expenses, which includes crew costs, provisions, deck and
engine stores, lubricating oil, insurance, maintenance and repairs,
is calculated by dividing vessel operating expenses by fleet
calendar days for the relevant time period.
|
(8)
|
Daily management fees
- related party adjusted are calculated by dividing management fees
- related party, excluding share based compensation to the
management company, by fleet calendar days for the relevant time
period.
|
(9)
|
Daily general and
administrative expenses adjusted are calculated by dividing general
and administrative expenses, excluding non-cash expenses relating
to the amortization of the share based compensation cost for
non-vested share awards, by fleet calendar days for the relevant
time period.
|
(10)
|
Total vessel
operating expenses ("TVOE") is a measurement of our total expenses
associated with operating our vessels. TVOE is the sum of vessel
operating expenses, management fees and general and administrative
expenses. Daily TVOE adjusted is calculated by dividing TVOE,
excluding non-cash expenses relating to the amortization of the
share based compensation cost for non-vested share awards and share
based compensation to the management company, by fleet calendar
days for the relevant time period.
|
Time Charter
Equivalents Reconciliation
(Expressed in
thousands of United States Dollars where applicable, except for
TCE)
|
|
|
Quarter
Ended
September 30,
2014
|
Quarter
Ended
September 30,
2015
|
Nine Months
Ended
September 30,
2014
|
Nine Months
Ended
September 30,
2015
|
Charter
Revenue
|
12,803
|
8,039
|
41,706
|
28,669
|
Commissions
|
(758)
|
(494)
|
(2,408)
|
(1,744)
|
Voyage Expenses,
net
|
(3,662)
|
(1,157)
|
(10,921)
|
(5,849)
|
Net Revenue, net of
voyage expenses
|
8,383
|
6,388
|
28,377
|
21,076
|
Total operating
days
|
1,276
|
1,160
|
3,712
|
4,013
|
Time Charter
Equivalent
|
6,570
|
5,508
|
7,645
|
5,252
|
Condensed Cash
Flow Information (Unaudited)
(Expressed in
thousands of United States Dollars)
|
|
|
Nine Months
Ended
September 30,
2014
|
Nine Months
Ended
September 30,
2015
|
Cash generated from /
(used in):
|
Operating
Activities
|
(3,729)
|
(5,715)
|
Investing
Activities
|
(65,598)
|
17,738
|
Financing
Activities
|
57,014
|
(15,161)
|
Reconciliation of
U.S. GAAP Financial Information to Non-GAAP Financial
Information
EBITDA and
Adjusted EBITDA Reconciliation (1)
(Expressed in
thousands of United States Dollars)
|
|
|
Quarter
Ended
September 30,
2014
|
Quarter
Ended
September 30,
2015
|
Nine Months
Ended
September 30,
2014
|
Nine Months
Ended
September 30,
2015
|
Net Loss
|
(6,037)
|
(13,369)
|
(41,574)
|
(95,207)
|
Plus Net interest
expense, including interest expense from interest rate
swaps
|
2,247
|
3,930
|
7,662
|
8,771
|
Plus
Depreciation
|
4,534
|
3,860
|
13,446
|
13,771
|
EBITDA
|
744
|
(5,579)
|
(20,466)
|
(72,665)
|
Adjusted EBITDA
Reconciliation
|
Net Loss
|
(6,037)
|
(13,369)
|
(41,574)
|
(95,207)
|
Loss related to
assets held for sale
|
-
|
-
|
-
|
47,640
|
Impairment
loss
|
-
|
3,210
|
15,695
|
19,964
|
Loss / (gain) from
sale of assets
|
-
|
114
|
(403)
|
114
|
(Gain) / loss from
marketable securities
|
-
|
-
|
(12)
|
134
|
Loss on investment in
affiliate
|
-
|
-
|
5,855
|
207
|
Unrealized gain on
interest rate swaps
|
(319)
|
(255)
|
(388)
|
(465)
|
Non-cash expenses
from the amortization of share based compensation cost recognized
and share based compensation to the management company
|
248
|
255
|
1,607
|
746
|
Write off of
financing expenses
|
-
|
1,717
|
1,511
|
1,717
|
Adjusted Net
Loss
|
(6,108)
|
(8,328)
|
(17,709)
|
(25,150)
|
Plus Net interest
expense, net of write off of financing expenses, including interest
expense from swaps
|
2,247
|
2,213
|
6,151
|
7,054
|
Plus
Depreciation
|
4,534
|
3,860
|
13,446
|
13,771
|
Adjusted
EBITDA
|
673
|
(2,255)
|
1,888
|
(4,325)
|
|
|
(1)
|
The Company considers
EBITDA to represent Net Income / (Loss) plus net interest expense,
including interest expense from interest rate swaps, and
depreciation and amortization. The Company's management uses EBITDA
and Adjusted EBITDA as a performance measure. EBITDA and Adjusted
EBITDA are not items recognized by U.S. GAAP and should not be
considered as an alternative to Net Income / (Loss), Operating
Income / (Loss) or any other indicator of a Company's operating
performance required by U.S. GAAP. The Company's definition of
EBITDA and Adjusted EBITDA may not be the same as that used by
other companies in the shipping or other industries. The Company
believes that EBITDA is useful to investors because the shipping
industry is capital intensive and may involve significant financing
costs. The Company excluded non-cash items to derive the Adjusted
Net Income / (Loss) and the Adjusted EBITDA because the Company
believes that these adjustments provide additional information on
the fleet operational results.
|
Reconciliation of
U.S. GAAP Financial Information to Non-GAAP Financial
Information
Adjusted Net
Income / (Loss) and Adjusted Earnings / (Loss) per common share
Reconciliation (Expressed in thousands of United States
Dollars - except for shares and share data)
|
|
U.S. GAAP
Financial Information
|
Quarter
Ended
September 30,
2014
|
Quarter
Ended
September 30,
2015
|
Nine Months
Ended
September 30,
2014
|
Nine Months
Ended
September 30,
2015
|
Net Loss
|
(6,037)
|
(13,369)
|
(41,574)
|
(95,207)
|
Net Loss attributable
to non-vested share awards
|
(83)
|
(241)
|
(653)
|
(1,629)
|
Net Loss available to
common shareholders
|
(5,954)
|
(13,128)
|
(40,921)
|
(93,578)
|
Weighted average
number of common shares basic and diluted
|
24,253,142
|
24,460,642
|
23,023,546
|
24,460,642
|
Loss per common share
basic and diluted
|
(0.25)
|
(0.54)
|
(1.78)
|
(3.83)
|
Reconciliation of
Net Income / (Loss) to Adjusted Net Income / (Loss)
|
|
|
|
|
Net Loss
|
(6,037)
|
(13,369)
|
(41,574)
|
(95,207)
|
Loss related to
assets held for sale
|
-
|
-
|
-
|
47,640
|
Impairment
loss
|
-
|
3,210
|
15,695
|
19,964
|
Loss / (gain) from
sale of assets
|
-
|
114
|
(403)
|
114
|
(Gain) / loss from
marketable securities
|
-
|
-
|
(12)
|
134
|
Loss on investment in
affiliate
|
-
|
-
|
5,855
|
207
|
Unrealized gain on
interest rate swaps
|
(319)
|
(255)
|
(388)
|
(465)
|
Non-cash expenses
from the amortization of share based compensation cost recognized
and share based compensation to the management company
|
248
|
255
|
1,607
|
746
|
Write off of
financing expenses
|
-
|
1,717
|
1,511
|
1,717
|
Adjusted Net Loss
(1)
|
(6,108)
|
(8,328)
|
(17,709)
|
(25,150)
|
Adjusted Net Loss
attributable to non-vested share awards
|
(84)
|
(150)
|
(278)
|
(430)
|
Adjusted Net Loss
available to common shareholders
|
(6,024)
|
(8,178)
|
(17,431)
|
(24,720)
|
Weighted average
number of common shares basic and diluted
|
24,253,142
|
24,460,642
|
23,023,546
|
24,460,642
|
Adjusted Loss per
common share basic and diluted (1)
|
(0.25)
|
(0.33)
|
(0.76)
|
(1.01)
|
|
|
(1)
|
Adjusted Net Income /
(Loss) and Adjusted Earnings / (Loss) per common share are not
items recognized by U.S. GAAP and should not be considered as
alternatives to Net Income / (Loss) and Earnings / (Loss) per
common share, respectively, or any other indicator of a Company's
operating performance required by U.S. GAAP. The Company excluded
non-cash items to derive at the Adjusted Net Income / (Loss) and
the Adjusted Earnings / (Loss) per common share basic and diluted
because the Company believes that these adjustments provide
additional information on the fleet operational results. The
Company's definition of Adjusted Net Income / (Loss) and Adjusted
Earnings / (Loss) per common share may not be the same as that used
by other companies in the shipping or other industries.
|
Paragon Shipping
Inc.
|
|
|
|
|
Unaudited
Condensed Consolidated Balance Sheets
|
|
|
|
|
As of December 31,
2014 and September 30, 2015
|
|
|
|
|
(Expressed in
thousands of United States Dollars)
|
|
|
|
|
|
|
December 31,
2014
|
|
September 30,
2015
|
Assets
|
|
|
|
|
|
|
|
|
|
Cash and restricted
cash (current and non-current)
|
|
20,920
|
|
6,903
|
Vessels,
net
|
|
369,033
|
|
245,588
|
Advances for vessels
under construction
|
|
49,972
|
|
33,299
|
Other fixed assets,
net
|
|
923
|
|
638
|
Investment in
affiliate
|
|
2,956
|
|
-
|
Other current and
non-current assets
|
|
12,800
|
|
6,283
|
|
|
|
|
|
Total
Assets
|
|
456,604
|
|
292,711
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Long-term debt, net
of deferred financing costs (including current portion)
|
|
226,418
|
|
157,476
|
Other current and
non-current liabilities
|
|
7,786
|
|
7,144
|
Total shareholders'
equity
|
|
222,400
|
|
128,091
|
|
|
|
|
|
Total Liabilities
and Shareholders' Equity
|
|
456,604
|
|
292,711
|
Paragon Shipping
Inc.
|
|
|
|
|
Unaudited
Condensed Consolidated Statements of Comprehensive
Loss
|
|
|
|
|
For the three
months ended September 30, 2014 and 2015
|
|
|
|
|
(Expressed in
thousands of United States Dollars - except for shares and share
data)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2014
|
|
September 30,
2015
|
Revenue
|
|
|
|
|
Charter
revenue
|
|
12,803
|
|
8,039
|
Commissions
|
|
(758)
|
|
(494)
|
Net
Revenue
|
|
12,045
|
|
7,545
|
Expenses /
(Income)
|
|
|
|
|
Voyage expenses,
net
|
|
3,662
|
|
1,157
|
Vessels operating
expenses
|
|
5,647
|
|
5,407
|
Dry-docking
expenses
|
|
-
|
|
486
|
Management fees -
related party
|
|
1,332
|
|
1,259
|
Depreciation
|
|
4,534
|
|
3,860
|
General and
administrative expenses
|
|
1,604
|
|
1,512
|
Impairment
loss
|
|
-
|
|
3,210
|
Bad debt
provisions
|
|
(15)
|
|
1
|
Loss from sale of
assets
|
|
-
|
|
114
|
Other
expenses
|
|
250
|
|
238
|
Operating
Loss
|
|
(4,969)
|
|
(9,699)
|
Other Income /
(Expenses)
|
|
|
|
|
Interest and finance
costs
|
|
(2,001)
|
|
(3,626)
|
Gain / (loss) on
derivatives, net
|
|
68
|
|
(50)
|
Interest
income
|
|
5
|
|
1
|
Equity in net income
of affiliate
|
|
813
|
|
-
|
Foreign currency
gain
|
|
47
|
|
5
|
Total Other Expenses,
net
|
|
(1,068)
|
|
(3,670)
|
Net
Loss
|
|
(6,037)
|
|
(13,369)
|
|
|
|
|
|
Other
Comprehensive Income / (Loss)
|
|
|
|
|
Equity in other
comprehensive income of affiliate
|
|
22
|
|
-
|
Unrealized gain on
change in fair value of marketable securities
|
|
25
|
|
-
|
Total Other
Comprehensive Income
|
|
47
|
|
-
|
|
|
|
|
|
Comprehensive
Loss
|
|
(5,990)
|
|
(13,369)
|
|
|
|
|
|
Loss per Class A
common share, basic and diluted
|
|
($0.25)
|
|
($0.54)
|
Weighted average
number of Class A common shares, basic and diluted
|
|
24,253,142
|
|
24,460,642
|
Paragon Shipping
Inc.
|
|
|
|
|
Unaudited
Condensed Consolidated Statements of Comprehensive
Loss
|
|
|
|
|
For the nine
months ended September 30, 2014 and 2015
|
|
|
|
|
(Expressed in
thousands of United States Dollars - except for shares and share
data)
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2014
|
|
September 30,
2015
|
Revenue
|
|
|
|
|
Charter
revenue
|
|
41,706
|
|
28,669
|
Commissions
|
|
(2,408)
|
|
(1,744)
|
Net
Revenue
|
|
39,298
|
|
26,925
|
Expenses /
(Income)
|
|
|
|
|
Voyage expenses,
net
|
|
10,921
|
|
5,849
|
Vessels operating
expenses
|
|
16,357
|
|
17,035
|
Dry-docking
expenses
|
|
2,193
|
|
837
|
Management fees -
related party
|
|
4,886
|
|
3,808
|
Depreciation
|
|
13,446
|
|
13,771
|
General and
administrative expenses
|
|
5,037
|
|
4,468
|
Loss related to
assets held for sale
|
|
-
|
|
47,640
|
Impairment
loss
|
|
15,695
|
|
19,964
|
Bad debt
provisions
|
|
-
|
|
17
|
(Gain) / loss from
sale of assets
|
|
(403)
|
|
114
|
(Gain) / loss from
marketable securities, net
|
|
(12)
|
|
134
|
Other
expenses
|
|
211
|
|
238
|
Operating
Loss
|
|
(29,033)
|
|
(86,950)
|
Other Income /
(Expenses)
|
|
|
|
|
Interest and finance
costs
|
|
(7,023)
|
|
(8,061)
|
Loss on derivatives,
net
|
|
(268)
|
|
(249)
|
Interest
income
|
|
17
|
|
4
|
Equity in net income
of affiliate
|
|
555
|
|
173
|
Loss on investment in
affiliate
|
|
(5,855)
|
|
(207)
|
Foreign currency
gain
|
|
33
|
|
83
|
Total Other Expenses,
net
|
|
(12,541)
|
|
(8,257)
|
Net
Loss
|
|
(41,574)
|
|
(95,207)
|
|
|
|
|
|
Other
Comprehensive Income / (Loss)
|
|
|
|
|
Unrealized gain on
cash flow hedges
|
|
131
|
|
-
|
Transfer of realized
loss on cash flow hedges to "Interest and finance costs"
|
|
99
|
|
-
|
Equity in other
comprehensive income of affiliate
|
|
17
|
|
-
|
Transfer of equity in
other comprehensive loss of affiliate to
"Loss on investment in affiliate"
|
|
-
|
|
14
|
Unrealized (loss) /
gain on change in fair value of marketable securities
|
|
(44)
|
|
3
|
Transfer of (gain) /
loss on change in fair value of marketable securities to "(Gain) /
loss from marketable securities, net"
|
|
(12)
|
|
134
|
Total Other
Comprehensive Income
|
|
191
|
|
151
|
|
|
|
|
|
Comprehensive
Loss
|
|
(41,383)
|
|
(95,056)
|
|
|
|
|
|
Loss per Class A
common share, basic and diluted
|
|
($1.78)
|
|
($3.83)
|
Weighted average
number of Class A common shares, basic and diluted
|
|
23,023,546
|
|
24,460,642
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/paragon-shipping-inc-reports-third-quarter-and-nine-months-ended-september-30-2015-results-300210242.html
SOURCE Paragon Shipping Inc.