DryShips, a diversified owner and operator of ocean going cargo vessels, announced its unaudited financial and operating results for the quarter ended December 31, 2018.
Fourth Quarter 2018 Financial Highlights
- For the fourth quarter of 2018, the Company reported net income of $5.8 million, or $0.06 basic and diluted earnings per share.
Included in the fourth quarter of 2018 results are:
— Losses from the sale of vessels to unaffiliated buyers and vessel impairments totaling $0.6 million, or $0.01 per share.
— Vessel dry-docking costs of $1.4 million, or $0.02 per share
Excluding the above, the Company’s net results would have amounted to net income of $7.8 million, or $0.09 earnings per share.
- The Company reported Adjusted EBITDA of $19.4 million for the fourth quarter of 2018.()
- Common Stock Repurchase Program As of February 28, 2019, the Company has repurchased a total of 6,523,854 shares of its common stock for an aggregate amount of $37.3 million, including commissions, pursuant to its previously announced new stock repurchase program under which the Company may repurchase up to $50.0 million of its outstanding common shares until October 29, 2019. Under its old $50.0 million stock repurchase program, which was completed in full on October 5, 2018, the Company had also repurchased a total of 10,864,227 shares of its common stock for an aggregate amount of $50.2 million, including commissions. The Company currently has outstanding 86,886,627 shares of common stock.
(1) Adjusted EBITDA is a non-U.S. GAAP measure; please see later in this press release for reconciliation to net income / (loss).
The table below describes the Company’s fleet as of February 28, 2019:
|Bacon||2013||205,170||T/C Index Linked||Sep-19||Oct-19|
|Conquistador*||2016||209,090||T/C Index Linked||N/A||N/A|
|Huahine||2013||206,037||T/C Index Linked||Sep-19||Oct-19|
|Judd||2015||205,796||T/C Index Linked||Sep-19||Oct-19|
|Marini*||2014||205,854||T/C Index Linked||Oct-19||Dec-19|
|Morandi||2013||205,854||T/C Index Linked||Aug-19||Sep-19|
|Pink Sands*||2016||208,931||T/C Index Linked||N/A||N/A|
|Xanadu*||2017||208,827||T/C Index Linked||N/A||N/A|
|Very Large Crude Carrier:|
|Samsara**||2017||159,855||$18,000 Base rate plus profit share||Mar.-22||May-25|
|Offshore Supply fleet|
|Platform Supply Vessels:|
|Oil Spill Recovery Vessels:|
* The vessel is time chartered by TMS Dry Ltd., an entity that may be deemed to be beneficially owned by our Company’s Chairman and CEO.
** The vessel is time chartered by Cecilia Shipholdings Limited, an entity that may be deemed to be beneficially owned by our Company’s Chairman and CEO.
Drybulk, Tanker and Gas Carrier Segments Summary Operating Data (unaudited)
(U.S. Dollars in thousands, except average daily results)
|Drybulk||Three Months Ended
|Average number of vessels(1)||22.0||17.1||18.1||19.2|
|Total voyage days for vessels(2)||1,952||1,553||6,534||6,947|
|Total calendar days for vessels(3)||2,022||1,576||6,604||7,024|
|Time charter equivalent(5)||$11,410||$14,023||$8,544||$12,405|
|Vessel operating expenses (daily)(6)||$6,385||$5,907||$6,061||$6,343|
|Tanker||Three Months Ended
|Average number of vessels(1)||4.0||5.2||2.5||4.6|
|Total voyage days for vessels(2)||368||478||911||1,685|
|Total calendar days for vessels(3)||368||478||911||1,685|
|Time charter equivalent(5)||$17,003||$27,981||$13,216||$20,715|
|Vessel operating expenses (daily)(6)||$7,745||$7,479||$9,693||$7,536|
|Gas Carrier||Three Months Ended
|Average number of vessels(1)||2.6||1.3||1.0||3.3|
|Total voyage days for vessels(2)||241||115||355||1,197|
|Total calendar days for vessels(3)||241||115||355||1,197|
|Time charter equivalent(5)||$28,058||$27,339||$27,994||$27,883|
|Vessel operating expenses (daily)(6)||$13,220||$10,087||$16,183||$8,611|
(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 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) Total voyage days for fleet are the total days the vessels were in the Company’s possession for the relevant period net of off-hire days associated with drydockings or special or intermediate surveys and laid-up days.
(3) Calendar days are the total number of days the vessels were in the Company’s possession for the relevant period including off-hire days associated with drydockings or special or intermediate surveys and laid-up days.
(4) Fleet utilization is the percentage of time that the Company’s vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period.
(5) Time charter equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. The Company’s method of calculating TCE is consistent with industry standards and is determined by dividing voyage revenues (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 and are paid by the charterer under a time charter contract, as well as commissions. TCE revenues, a non-U.S. GAAP measure, provides additional meaningful information in conjunction with revenues from the Company’s vessels, the most directly comparable U.S. GAAP measure, because it assists the Company’s management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance. TCE is also 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 charters, time charters and bareboat charters) under which the vessels may be employed between the periods. Please see below for a reconciliation of TCE rates to voyage revenues.
(6) Daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs including dry-docking costs, is calculated by dividing vessel operating expenses by fleet calendar days net of laid-up days for the relevant time period.
Drybulk, Tanker and Gas Carrier Segments Summary Operating Data (unaudited) – continued
(In thousands of U.S. dollars, except for TCE rate, which is expressed in U.S. Dollars, and voyage days)
|Drybulk||Three Months Ended December 31,||Year Ended December 31,|
|Time charter equivalent revenues||$||22,272||$||21,777||$||55,824||$||86,179|
|Total voyage days for fleet||1,952||1,553||6,534||6,947|
|Time charter equivalent (TCE)||$||11,410||$||14,023||$||8,544||$||12,405|
|Tanker||Three Months Ended December 31,||Year Ended December 31,|
|Time charter equivalent revenues||$||6,257||$||13,375||$||12,040||$||34,904|
|Total voyage days for fleet||368||478||911||1,685|
|Time charter equivalent (TCE)||$||17,003||$||27,981||$||13,216||$||20,715|
|Gas Carrier||Three Months Ended December 31,||Year Ended December 31,|
|Time charter equivalent revenues||$||6,762||$||3,144||$||9,938||$||33,376|
|Total voyage days for fleet||241||115||355||1,197|
|Time charter equivalent (TCE)||$||28,058||$||27,339||$||27,994||$||27,883|
Unaudited Condensed Consolidated Statements of Operations
|(Expressed in Thousands of U.S. Dollars
except for share and per share data)
Three Months Ended December 31,
|Year Ended December 31,|
|Vessel operating expenses||19,192||14,235||60,260||68,391|
|Impairment loss,(gain)/loss from sale of vessels and other||(4,425||)||585||(4,125||)||(9,623||)|
|General and administrative expenses||7,334||6,314||30,972||28,314|
|Interest and finance costs, net of interest income||(5,029||)||(5,346||)||(13,342||)||(18,946||)|
|Loss on private placement||–||–||(7,600||)||–|
|Total other expenses, net||(5,061||)||(5,218||)||(21,495||)||(18,863||)|
|Net income/(loss) attributable to DryShips Inc. common stockholders||1,789||5,828||(39,739||)||21,780|
|Earnings/(Losses) per common share, basic and diluted||$||0.02||$||0.06||$||(1.13||)||$||0.22|
|Weighted average number of shares, basic and diluted||103,088,937||91,050,308||35,225,784||98,113,545|
Unaudited Condensed Consolidated Balance Sheets
|(Expressed in Thousands of U.S. Dollars
except for share data)
|December 31, 2017||December 31, 2018|
|Cash, cash equivalents, including restricted cash (current and non-current)||$||30,226||$||156,881|
|Other current and non-current assets||123,713||99,092|
|Advances for vessels under construction||31,898||–|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Total debt and finance lease liabilities||216,969||362,047|
|Total other liabilities||10,920||11,529|
|Total stockholders’ equity||707,036||637,729|
|Total liabilities and stockholders’ equity||$||934,925||$||1,011,305|
|SHARE COUNT DATA|
|Common stock issued||104,274,708||104,274,708|
|Less: Treasury stock||–||(17,042,680||)|
|Common stock issued and outstanding||104,274,708||87,232,028|
Adjusted EBITDA Reconciliation
Adjusted EBITDA represents earnings before interest, taxes, depreciation and amortization, vessel sales and impairments and certain other non-cash items as described below. Adjusted EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, and the Company’s calculation of adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is included herein because it is a basis upon which the Company measures its operations. Adjusted EBITDA is also used by the Company’s lenders as a credit metric and the Company believes that it presents useful information to investors regarding a company’s ability to service and/or incur indebtedness.
The following table reconciles net income / (loss) to Adjusted EBITDA:
|(Expressed in Thousands of U.S. Dollars)||Three Months Ended
|Add: Net interest expense||5,029||5,346||13,342||18,946|
|Add: Impairment loss, (gain)/loss from sale of vessel and other||(4,425||)||585||(4,125||)||(9,623||)|
|Add: Loss on private placement||–||–||7,600||–|
|Add: Write-off of capitalized expenses||–||–||–||470|
|Add: Income taxes||71||2||152||6|