Safe Bulkers reports loss in 1Q2016

safe bulkers

Safe Bulkers announced its unaudited financial results for the three month period ended March 31, 2016.

Summary of First Quarter 2016 Results

  • Net revenue for the first quarter of 2016 decreased by 23% to $24.7 million from $32.1 million during the same period in 2015.
  • Net loss for the first quarter of 2016 was $17.8 million as compared to $6.0 million, during the same period in 2015. Adjusted net loss1 for the first quarter of 2016 was $14.4 million as compared to $4.6 million, during the same period in 2015.
  • EBITDA2 for the first quarter of 2016 decreased to $0.3 million as compared to $7.6 million during the same period in 2015. Adjusted EBITDA3 for the first quarter of 2016 decreased by 58% to $3.8 million from $9.1 million during the same period in 2015.
  • Loss per share4 and Adjusted loss per share4 for the first quarter of 2016 were $0.25 and $0.21 respectively, calculated on a weighted average number of shares of 83,542,291, as compared to a Loss per share of $0.11 and Adjusted loss per share of $0.10 during the same period in 2015, calculated on a weighted average number of shares of 83,462,059.

Fleet and Employment Profile

As of May 27, 2016, the Company’s operational fleet, following two newbuild deliveries and two vessel sales, comprised of 36 drybulk vessels with an average age of 6.3 years and an aggregate carrying capacity of 3.3 million dwt. The fleet consists of 13 Panamax class vessels, 8 Kamsarmax class vessels, 12 Post-Panamax class vessels and 3 Capesize class vessels, all built from 2003 onwards.

As of May 27, 2016, the Company had contracted to acquire 5 eco-design newbuild vessels, comprised of two Japanese Panamax class vessels, two Japanese Kamsarmax class vessels and one Chinese Kamsarmax class vessel. Upon delivery of all newbuilds and assuming we do not acquire any additional vessels or dispose of any of our vessels, our fleet will comprise of 41 vessels, 14 of which will be eco-design vessels, having an aggregate carrying capacity of 3.7 million dwt.

Capital expenditure requirements and liquidity

As of May 27, 2016, the Company had agreed to acquire five newbuild vessels, with one to be delivered in 2016, three to be delivered in 2017, and one to be delivered in 2018. The remaining capital expenditure requirements to shipyards or sellers before minor adjustments for shipyards’ costs relating to certain delayed deliveries for the five vessels amounted to $115.4 million, of which $25.0 million is due in 2016, $68.6 million in 2017 and $21.8 million is due in 2018.

As of May 27, 2016, the Company had liquidity of $210.4 million consisting of $115.9 million in cash and bank time deposits, $17.2 million in restricted cash and $77.3 million available under committed loan facilities and financing transactions.

Dividend Policy

The Board of Directors of the Company has not declared a dividend for the first quarter of 2016. The Company had 83,561,811 shares of common stock issued and outstanding as of May 27, 2016.

The declaration and payment of dividends, if any, will always be subject to the discretion of the Board of Directors of the Company. The timing and amount of any dividends declared will depend on, among other things: (i) the Company’s earnings, financial condition and cash requirements and available sources of liquidity; (ii) decisions in relation to the Company’s growth strategies; (iii) provisions of Marshall Islands and Liberian law governing the payment of dividends; (iv) restrictive covenants in the Company’s existing and future debt instruments; and (v) global economic and financial conditions.

Management Commentary

Dr. Loukas Barmparis, President of the Company, said: “We had initiated an operating expenses cost reduction initiative in May 2015, which resulted in substantially lower daily vessel operating expenses5, reaching the figure of $3,653 for the first quarter of 2016. As a result,  in this lowest freight market experienced over the last 30 years, our Time Charter Equivalent rate of $6,355 per day is higher than our aggregate daily vessel operating expenses and daily general and administrative expenses5 of $4,854, adding to our liquidity.”

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