Globus Maritime Limited Reports Results for the Second Quarter & Six Months Ended June 30, 2008 and Declares Interim Dividend
ATHENS, Greece--(BUSINESS WIRE)--Globus Maritime Limited ("Globus" or "the Company") (AIM: GLBS), a marine transportation company that owns and operates Handymax and Panamax drybulk ocean-going vessels, announces its unaudited interim operating and financial results for the three months (“Q2-08”) and six months (“H1-08”) period ended June 30, 2008 and declares an interim dividend of GB 26.9 pence (US 50 cents) per share.
Globus began operations on September 15, 2006, and on June 6, 2007 the Company’s shares were admitted for trading on AIM. On June 30, 2007 Globus owned five vessels with a total 216,010 deadweight tons (“DWT”), while on June 30, 2008 the Company’s fleet included eight vessels with a total 415,558 DWT, a 92.4% increase.
All the following figures are in United States Dollars, except for the dividends which are in Pounds Sterling.
Second Quarter 2008 Highlights versus Second Quarter 2007:
- Net Revenue of USD 27.8 million versus USD 7.5 million, an increase of 271%;
- Operating Expenses of USD 3.1 million versus USD 1.6 million, an increase of 94%;
- EBITDA of USD 23.3 million versus USD 5.4 million, an increase of 331%;
- Cash flow from operations of USD 23.9 million versus USD 6.6 million, an increase of 262%;
- Net Income of USD 17.0 million versus USD 2.3 million, an increase of 639%;
- Average Time Charter Equivalent (“TCE”) rate of USD 40,088 per vessel per day with an average 8 vessels operated, versus an average TCE of USD 16,862 per vessel per day with an average of 5 vessels operated during Q2-07;
- Fleet utilization of 99.1% versus 86.6%.
First Half 2008 Highlights versus First Half 2007:
- Net Revenues of USD 50.5 million versus USD 14.6 million, an increase of 246%;
- Operating Expenses of USD 6.4 million versus USD 3.1 million, an increase of 106%;
- EBITDA of USD 42.1 million versus USD 10.5 million, an increase of 301%;
- Cash flow from operations of USD 41.1 million versus USD 13.2 million, an increase of 211%;
- Net Income of USD 28.6 million versus USD 3.8 million, an increase of 653%;
- Average TCE rate of USD 35,987 per vessel per day with an average 8.0 vessels operated, versus an average TCE of USD 16,596 per vessel per day with an average of 4.9 vessels operated during H1-07;
- Fleet utilization of 98.7% versus 85.7%.
EPS of US99.68 cents, calculated on 28,655,756 shares outstanding at June 30, 2008.
Dividend Declaration:
In implementation of the Company’s dividend policy, the Directors declare an interim dividend of GB 26.9 pence per share (US 50 cents per share), amounting to USD 14.3 million in total, based on the net income of USD 28.6 million for the six months ended June 30, 2008. This dividend represents a dividend payout ratio of 50.16% of the net income of H1-08.
The translation from US dollars to British Pounds is based on the foreign exchange rate released by the Federal Reserve at noon on August 25, 2008, being 1.8587 USD per GBP.
This interim dividend will be payable on or about September 19, 2008 to all shareholders on record on September 5, 2008. The issued share capital as of the date of this release is 28,655,756 shares of USD 0.001 each.
For more meaningful comparison please note that in August 2007 the Company had declared its first interim dividend as a public company in the amount of GB1.44 pence per share (US2.86 cents per share), which was based on the net income of the month of June 2007, the only month during the first half of 2007 that Globus operated as a public company. That interim dividend was paid on September 24, 2007.
Fleet
Globus’ fleet comprises a total of eight modern dry bulk carriers, consisting of six Handymaxes and two Panamaxes, with a weighted average age of approximately 11.2 years as at June 30, 2008 and a total carrying capacity of 415,558 DWT.
Fleet Deployment
As of the day of this release, the current charter coverage for 2008 and 2009 is 63% and 25% of the available days respectively.
Five vessels in Globus’ fleet were trading under time charters with reputable charterers, while three vessels traded in the spot market during the period. Given the strength in the drybulk market during H1-08, the Company employed these three vessels on the spot market in order to earn very attractive rates. Globus management is however closely monitoring the period charter rates and intends to fix these vessels on medium to long-term time charters at the appropriate time.
Management Commentary
George Karageorgiou, Chief Executive Officer of Globus Maritime Limited, said:
“We are pleased with our results for the second quarter and first half of 2008, which were driven by the very high spot rates as well as the fleet utilization levels that we attained for yet another quarter. We remain optimistic for our future performance despite the recent market volatility. Our fleet employment profile enables us to capitalize on the presently attractive rates, while during the last six months we further diversified our customer base.”
“In the span of 15 months since going public, we have grown Globus from a fleet of five to a fleet of eight bulk carrier vessels, while maintaining a prudent leverage structure, delivering an exceptional dividend yield and substantially increasing shareholder value in currently difficult market conditions. We remain determined to continue delivering this value to our shareholders.”
Elias Deftereos, Chief Financial Officer, added:
“We are very pleased to have achieved these results since we went public in June 2007. At June 30, 2008 our cash balance was USD 30.4 million, while total bank debt outstanding amounted to USD 172.8 million, with another USD 20 million still available and undrawn under our existing bank facilities. With our moderate leverage, coupled with sufficient access to bank financing, we can take advantage of the continuing positive fundamentals of the dry bulk industry.”
“The Board had declared a dividend of GB26.9 pence, which represents a 268% increase over the dividend for the second half of 2007. This dividend is just over 50% of our net income, yet it suffices to keep our company amongst the highest dividend paying shipping companies; based on the closing price of GB405 pence on August 27, our annualized dividend yield stands at 13.3%. We will continue to pay dividends twice per year, in implementation of our stated dividend policy.”
Unaudited Interim Consolidated Financial Statements
The Company’s Unaudited Interim Consolidated Financial Statements at June 30, 2008 are available and can be downloaded from the Company’s website: www.globusmaritime.gr.
Review of Results for the Quarter Ended June 30, 2008 – unaudited.
Trading during Q2-08 was in line with Management’s expectations. As a result of the increase in prevailing spot charter rates and the increase in the number of vessels in the Company’s fleet, Net Income increased by 639% to USD 17 million from USD 2.3 million during Q2-07.
Net revenues were USD 27.8 million during Q2-08 as eight vessels were employed at an average TCE rate of USD 40,088 per vessel per day, while the three vessels (Ocean Globe, Lake Globe, and River Globe) operating in the spot market earned on average more that USD 57,000 per vessel per day during the period.
During Q2-08, ownership days were 728 versus 455 in Q2-07. The vessels “Tiara Globe” and “Island Globe” were dry-docked for a total of 35 days due to their scheduled special surveys, and consequently the available days in Q2-08 were 693. We had a total of 6 days either due to unforeseen offhires or ballasting of our three spot vessels during this quarter, bringing operating days to 687. Fleet utilization thus reached 99.1% compared to 86.6% during the same quarter 2007.
As a result of tight cost controls, the daily operating expenses per vessel came to USD 4,260 (versus USD 3,440 in Q2-07), decreasing by 6% from the figure of USD 4,523 reported for Q1-08. The increase during the quarter ended June 30, 2008 compared to the quarter ended June 30, 2007 was mainly due to the increase in the average number of vessels in our fleet and a general increase in costs experienced by the whole industry, including increased crew wages, lube expenses, and insurance costs due to the increase of the insured values of our vessels.
Interest and Finance expenses amounted to USD 1.64 million in Q2-08 versus USD 1.27 million in Q2-07, attributable primarily to higher indebtedness due to the increase in the number of vessels in the Company’s fleet.
Depreciation expenses increased by 114% to USD 4.5 million in Q2-08, from USD 2.1 million in Q2-07. The increase in depreciation expenses was due to the increased average number of vessels in our fleet during the quarter.
Review of Results for Six Months Ended June 30, 2008 – unaudited.
An average of 8 vessels were owned and operated in the first six months of 2008 versus an average of 4.9 vessels in H1-07, resulting in 1,456 ownership days compared to 895 ownership days in H1-07, a 63% increase.
For the six months ended June 30, 2008, as a result of the increase in prevailing spot charter rates and the increase in the number of vessels in the Company’s fleet, net revenues amounted to USD 50.5 million, EBITDA was USD 42.1 million, and net income was USD 28.6 million, compared to USD 14.6 million, USD 10.5 million, and USD 3.8 million respectively in H1-07.
The Globus vessels earned an average TCE of USD 35,987 per vessel per day, while fleet operating expenses were USD 4,391 on average per day per vessel compared to USD 16,596 and USD 3,455 respectively in H1-07.
General and Administrative expenses during H1-08 came to USD 2.4 million. The increase was mainly due to higher onshore personnel costs as the management team was strengthened following the fleet expansion, as well as the cost of shares awarded to the two Executive Directors under their respective employment contracts totalling USD 385 thousand, a non-cash item.
Financing Activities
In March 2008, the Company drew USD 70 million from a new USD 85 million bank facility from Deutsche Schiffsbank (DSB), which was used to refinance the previous bank facility from ABB and HSH Nordbank. This facility is repayable over 8 years in equal quarterly instalments, the first of which was paid to DSB at the end of June 2008. During the first half of 2008 the Company also paid to Credit Suisse the first semi-annual instalment of USD 10 million, USD 8 million of which had been repaid as early as March 2008.
During the period under review, the Company incurred additional capital expenditures due to special surveys of the two Panamax vessels “Tiara Globe” and “Island Globe” which spent a total of 54 days in dry-dock during H1-08. The cost of these scheduled repairs was funded with cash from operations and will be amortized over the next two and a half years. No other vessels are scheduled to be dry-docked during the rest of 2008.
Conference Call details
Today, August 28, 2008 at 1:30pm UK, 3:30pm Athens, 8:30am Eastern Time, the Company’s management team will host a conference call to discuss the results.
Conference Call details:
Participants should dial into the call 10 minutes prior to the scheduled time using the following numbers: 0800-953-0329 (from the UK), 1-866-819-7111 (from the US), 00800-4413-1378 (from Greece), or +44 (0)1452-542-301 (all other callers). Please quote “Globus Maritime”.
A telephonic replay of the conference call will be available until September 4th, 2008 by dialling 0800-953-1533 (from the UK), 1-866-247-4222 (from the US), or +44(0)1452 550-000 (all other callers). Access Code: 36407079#
All information will also be accessible through the Globus Maritime Ltd website www.globusmaritime.gr.
An audio file with the Conference Call as well as the slide presentation will remain archived on the company’s website www.globusmaritime.gr under the section “Investor Relations”.
|
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||||
| For the Three Months Ended | For the Six Months Ended | |||||||||||
| (in thousands of US dollars) | 30 June 2008 | 30 June 2007 | 30 June 2008 | 30 June 2007 | ||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||
| Income Statement Data: | ||||||||||||
| Gross Revenue | 28,911 | 7,915 | 52,868 | 15,517 | ||||||||
| Voyage expenses (incl. commissions) | (1,130 | ) | (445 | ) | (2,414 | ) | (879 | ) | ||||
| Net Revenue | 27,781 | 7,470 | 50,454 | 14,638 | ||||||||
| Vessels operating expenses | (3,101 | ) | (1,565 | ) | (6,394 | ) | (3,092 | ) | ||||
| Administrative expenses | (1,389 | ) | (474 | ) | (2,385 | ) | (778 | ) | ||||
| Other income / (expenses) | 57 | - | 440 | (300 | ) | |||||||
| EBITDA | 23,348 | 5,431 | 42,115 | 10,468 | ||||||||
| Depreciation | (4,479 | ) | (2,147 | ) | (8,952 | ) | (4,219 | ) | ||||
| Amortization of dry-docking costs | (389 | ) | (215 | ) | (697 | ) | (442 | ) | ||||
| Operating profit before finance costs | 18,480 | 3,069 | 32,466 | 5,807 | ||||||||
| Interest expense | (1,638 | ) | (1,274 | ) | (4,172 | ) | (2,589 | ) | ||||
| Interest income | 154 | 201 | 266 | 249 | ||||||||
| Foreign exchange gains | 10 | 311 | 3 | 303 | ||||||||
| Profit for the period | 17,006 | 2,307 | 28,563 | 3,770 | ||||||||
| Cash Flow Data: | ||||||||||||
| Net cash flow from operating activities | 23,858 | 6,645 | 41,131 | 13,164 | ||||||||
| Net cash flow used in investing activities | (2,127 | ) | (722 | ) | (2,459 | ) | (25,718 | ) | ||||
| Net cash flows (used in)/from financing activities | (9,370 | ) | 41,462 | (17,654 | ) | 58,899 | ||||||
| FLEET OPERATING DATA | ||||||||||||
| The following information is unaudited | ||||||||||||
| Fleet Data: | ||||||||||||
| Average number of vessels(1) | 8 | 5 | 8 | 4.9 | ||||||||
| Number of vessels at end of period | 8 | 5 | 8 | 5 | ||||||||
| Weighted average age of fleet (in years)(2) | 11.2 | 12.5 | 11.2 | 12.5 | ||||||||
| Ownership days(3) | 728 | 455 | 1,456 | 895 | ||||||||
| Available days(4) | 693 | 443 | 1,402 | 882 | ||||||||
| Operating days(5) | 687 | 384 | 1,384 | 756 | ||||||||
| Fleet utilization(6) | 99.1 | % | 86.6 | % | 98.7 | % | 85.7 | % | ||||
| Average Daily Results: | ||||||||||||
| Vessel operating expenses (U.S. dollars)(7) | 4,260 | 3,440 | 4,391 | 3,455 | ||||||||
| Time charter equivalent (TCE) rate (U.S. dollars)(8) | 40,088 | 16,862 | 35,987 | 16,596 | ||||||||
| (in thousands of US dollars) |
As at 30 June 2008 |
As at 30 June 2007 |
||||||||||
| (unaudited) | (unaudited) | |||||||||||
| Selected Balance Sheet Data: | ||||||||||||
| Cash & Cash equivalents | 30,359 | 48,414 | ||||||||||
| Restricted Cash | - | 825 | ||||||||||
| Total Assets | 300,090 | 175,420 | ||||||||||
| Dividend Payable | - | 2,100 | ||||||||||
| Long term debt net of Unamortized fees | 172,750 | 75,925 | ||||||||||
| Total Shareholder’s equity | 121,495 | 88,848 | ||||||||||
Notes:
(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 fleet during the period divided by the number of calendar days in the period.
(2) The average age of the fleet is calculated by aggregating the individual age of each vessel in the fleet at the period end weighted by each vessel’s deadweight tonnage in proportion to the deadweight tonnage of the whole fleet at the period end.
(3) Ownership days are the aggregate number of days in a period during which each vessel in the fleet has been owned by the Company. Ownership days are an indicator of the size of the fleet over a period and affect both the amount of revenues and the amount of expenses that are recorded during a period.
(4) Available days are the number of ownership days less the aggregate number of days that vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys and the aggregate amount of time spent positioning vessels. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
(5) Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
(6) Fleet utilisation is measured by dividing the number of operating days during a period by the number of available days during the same period. The shipping industry uses fleet utilisation to measure a company’s efficiency in finding suitable employment for its vessels and minimising the amount of days that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel upgrades, special surveys or vessel positioning.
(7) Average daily vessel operating expenses, which include crew wages and related costs, the cost of insurance, expenses relating to repairs and maintenance, the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses, are calculated by dividing vessel operating expenses by ownership days for the relevant period.
(8) TCE rates are defined as time and voyage charter revenues less voyage expenses during a period divided by the number of available days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. TCE rate is a standard shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per day amounts while charter hire rates for vessels on time charters are generally expressed in such amounts.
The following tables represent the Company’s fleet as on the date of this release:
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Fleet Employment Profile as at the day of this press release: |
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| Vessel |
Type |
Charterer |
Charter |
Charter |
Gross |
|||||
| Lake Globe | Handymax | Currently on Spot | 53,000 | |||||||
| Coral Globe | Handymax | STX Pan Ocean | 10/08 | 1/09 | 19,500(2) | |||||
| Gulf Globe | Handymax | COSCO | 12/08 | 3/09 | 22,000 | |||||
| Ocean Globe | Handymax | Currently on Spot | 41,000 est | |||||||
| Sea Globe | Handymax | COSCO | 11/08 | 2/09 | 22,000 | |||||
| River Globe | Handymax | Currently on Spot | 60,000 | |||||||
| Tiara Globe | Panamax | Korea Line Corp | 12/09 | 3/10 | 66,000 | |||||
| Island Globe | Panamax | DS Norden | 06/09 | 9/09 | 30,000 | |||||
Notes:
(1) The latest charter expiration date represents the last day on which the charterer may redeliver the vessel upon the termination of the charter assuming that all options for additional hire periods under the charter are exercised, including taking into account expected off-hire days because of scheduled dry-dockings.
(2) The daily charter hire payable under the charter for this vessel reduces during the term of the charter. A daily gross rate of USD 22,000 applied from 11/2006 for the first 365 days and a daily gross rate of USD 17,000 will apply for the remainder of the charter period. For purposes of revenue recognition, the daily charter hire included in the consolidated financial information is based on the average amount payable over the charter term, namely USD 19,500.
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Fleet Profile as of the date of this Press Release: |
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| Vessel |
Year |
Yard |
Type |
Month/Yr |
DWT | FLAG | ||||||
| M/V Lake Globe | 1994 | Hyundai | Handymax | 12/2006 | 43,216 | Bahamas | ||||||
| M/V Coral Globe | 1994 | Hyundai | Handymax | 11/2006 | 43,189 | Bahamas | ||||||
| M/V Gulf Globe | 1994 | Hyundai | Handymax | 1/2007 | 43,245 | Bahamas | ||||||
| M/V Ocean Globe | 1995 | Hyundai | Handymax | 9/2006 | 43,189 | Bahamas | ||||||
| M/V Sea Globe | 1995 | Hyundai | Handymax | 9/2006 | 43,171 | Bahamas | ||||||
| M/V River Globe | 2007 | Yangzhou Dayang | Handymax | 12/2007 | 53,500 | Marshall Is | ||||||
| M/V Island Globe | 1995 | Samsung | Panamax | 7/2007 | 73,119 | Marshall Is | ||||||
| M/V Tiara Globe | 1998 | Hudong Zhonghua | Panamax | 12/2007 | 72,929 | Marshall Is | ||||||
| Average Age | 11.2 | Years at 30/6/08 | 415,558 | |||||||||
| GLOBUS MARITIME LIMITED | ||||
| INTERIM CONDENSED CONSOLIDATED BALANCE SHEET | ||||
| At June 30, 2008 | ||||
| (Expressed in thousands of U.S. Dollars) | ||||
| June 30, | December 31, | |||
|
ASSETS |
2008 | 2007 | ||
| (unaudited) | (audited) | |||
| NON-CURRENT ASSETS | ||||
| Vessels, net | 266,762 | 273,720 | ||
| Office furniture and equipment | 60 | 51 | ||
| Other assets | 10 | 10 | ||
| Total non-current assets | 266,832 | 273,781 | ||
| CURRENT ASSETS | ||||
| Cash and cash equivalents | 30,359 | 9,341 | ||
| Restricted cash | - | 732 | ||
| Trade receivables, net | 387 | 35 | ||
| Inventories | 551 | 553 | ||
| Prepayments and other assets | 1,961 | 1,058 | ||
|
Total current assets |
33,258 | 11,719 | ||
|
TOTAL ASSETS |
300,090 | 285,500 | ||
|
EQUITY AND LIABILITIES |
||||
| EQUITY ATTRIBUTABLE TO SHAREHOLDERS | ||||
| Share capital | 29 | 29 | ||
| Share premium | 87,580 | 87,411 | ||
| Retained earnings | 33,886 | 9,237 | ||
| Total shareholders' equity | 121,495 | 96,677 | ||
| NON-CURRENT LIABILITIES | ||||
| Long-term borrowings, net of current portion | 148,212 | 157,039 | ||
| Provision | 18 | 30 | ||
|
Total non-current liabilities |
148,230 | 157,069 | ||
| CURRENT LIABILITIES: | ||||
| Current portion of long-term borrowings | 23,852 | 25,477 | ||
| Trade accounts payable | 2,565 | 3,093 | ||
| Accrued liabilities and other payables | ||||