Overseas Shipholding Group Reports Fourth Quarter and Full Year 2021 Results

TAMPA, Fla.--()--Overseas Shipholding Group, Inc. (NYSE: OSG) (the “Company” or “OSG”), a leading provider of energy transportation services for crude oil and petroleum products in the U.S. Flag markets, today reported results for the fourth quarter and full year 2021.

  • Shipping revenues for the fourth quarter 2021 were $95.5 million, an increase of $1.5 million from the third quarter 2021. Compared to the fourth quarter 2020, shipping revenues decreased 2.1% from $97.5 million. Shipping revenues for the full year 2021 were $359.1 million, down 14.2% compared with the full year 2020.
  • Net loss for the fourth quarter 2021 was $3.7 million, or $(0.03) per diluted share, compared with net loss of $16.0 million, or ($0.18) per diluted share, in the third quarter 2021. Net loss was $844 thousand, or $(0.01) per diluted share, for the fourth quarter 2020. Net loss for the full year 2021 was $46.3 million, or $(0.51) per diluted share, compared with net income of $30.0 million, or $0.33 per diluted share, for the full year 2020.
  • Time charter equivalent (TCE) revenues(A), a non-GAAP measure, for the fourth quarter 2021 were $80.0 million, an increase of $4.7 million from third quarter 2021. TCE revenues were down 7.0% compared to fourth quarter 2020. TCE revenues for the full year 2021 were $292.6 million, down 22.1% compared with the full year 2020.
  • Fourth quarter 2021 Adjusted EBITDA(B), a non-GAAP measure, was $16.6 million, an increase of $4.4 million from the third quarter. Adjusted EBITDA decreased 19.0% from $20.5 million in the fourth quarter 2020. Full year Adjusted EBITDA was $45.1 million, down 63.8% from $124.9 million in the same period in 2020.
  • Total cash(C) was $83.3 million as of December 31, 2021.
  • During the quarter, we removed one vessel from layup. Subsequent to quarter-end, we removed an additional two vessels. As of March 1, 2022, we have two vessels remaining in layup.

Sam Norton, President and CEO, offered the following comments on the quarterly results announced today: “We are pleased with the operating results achieved during the final quarter of last year, marking the third consecutive quarter of improved sequential TCE and EBITDA performance. Importantly, we expect this trend to continue in 2022. As noted in our prior quarter’s release, Jones Act Vessel availability across the fourth quarter and into 2022 has tightened considerably, meaning that business fundamentals for our conventional Jones Act tankers continue to strengthen. Following on from having activated three tankers out of layup at the end of the third quarter and in the fourth quarter, the Overseas Anacortes and Overseas Long Beach have now joined the active trading fleet in recent weeks, leaving only one tanker and one lightering ATB in layup as of today. With additional available operating days at improved market rates, and the reliably solid contribution from our niche and Alaskan Tanker Company assets, we are witnessing steadily improving cashflows from our businesses and an improving balance sheet.”

Mr. Norton added, “Energy markets are experiencing dislocations at this time”, Mr. Norton continued, “creating trading opportunities that are not usually seen in the markets within which OSG operates. OSG’s fleet is well positioned to facilitate many of these new trading opportunities and, in doing so, providing reliably available transportation to meeting the evolving needs of the domestic US market.”

 

 

 

 

 

A, B, C Reconciliations of these non-GAAP financial measures are included in the financial tables attached to this press release starting on Page 8.

Fourth Quarter 2021 Results

Shipping revenues were $95.5 million for the fourth quarter, an increase of $1.5 million, or 1.6%, from the third quarter of 2021. TCE revenues increased $4.7 million, or 6.1%, from the third quarter to $80.0 million in the fourth quarter. The increases were primarily a result of a 168-day decrease in layup days as two vessels came out of layup in September 2021 and a third vessel came out of layup in December 2021. Delaware Bay lightering volumes also contributed to an increase in revenues.

The fourth quarter operating loss was $1.9 million compared to the third quarter operating loss of $5.6 million.

Quarterly adjusted EBITDA increased to $16.6 million during the fourth quarter, a $4.4 million increase from the third quarter of 2021. The increase was driven by the increased revenues for the quarter.

In comparison to the fourth quarter of 2020, shipping revenues were down 2.1%. TCE revenues for the fourth quarter of 2021 were $80.0 million, a decrease of $6.1 million, or 7.0%, compared with the fourth quarter of 2020. The decrease resulted primarily from a 173-day increase in layup days due to vessels in layup during the fourth quarter of 2021 and one less MR tanker in the Company's fleet, reflecting the sale of the Overseas Gulf Coast during the second quarter of 2021. The decrease was offset by the addition to the Company's fleet of one ATB, OSG 205, delivered in December 2020.

Operating loss for the fourth quarter of 2021 was $1.9 million compared to operating income of $2.2 million for the fourth quarter of 2020. Net loss for the fourth quarter of 2021 was $3.7 million, or $(0.03) per diluted share, compared with net loss of $844 thousand, or $(0.01) per diluted share, for the fourth quarter 2020.

Adjusted EBITDA was $16.6 million for the 2021 fourth quarter, a decrease of $3.9 million compared with the fourth quarter of 2020, driven primarily by the decrease in TCE revenues.

Full Year 2021 Results

Shipping revenues were $359.0 million for the full year 2021, down 14.2% compared with the full year 2020. TCE revenues for the full year 2021 were $292.6 million, a decrease of $83.3 million, or 22.1% compared with the full year 2020. The decreases were primarily a result of (a) a 1,894-day increase in layup days due to seven vessels in layup for most of 2021, a decision taken in light of the lack of demand due to the economic impact of COVID-19, (b) one less MR tanker in our fleet, Overseas Gulf Coast, which was sold during the second quarter of 2021 and (c) two fewer ATBs, which were sold in May 2020 and August 2020, respectively. The decreases were offset by (a) a 204-day decrease in scheduled drydocking, (b) the addition to our fleet of three crude oil tankers, Alaskan Explorer, Alaskan Legend and Alaskan Navigator, which were purchased in March 2020, and two ATBs, OSG 204 and OSG 205, which were delivered at the end of May 2020 and the beginning of December 2020, respectively, (c) an increase in Delaware Bay lightering volumes and (d) five voyages for Military Sealift Command, which were longer international voyages, during 2021 compared to two such voyages during 2020. Two of seven vessels came out of layup in September 2021 and operated in the spot market. One of these two vessels commenced a 26-month time charter in mid-November 2021. A third vessel came out of layup in December 2021 and operated in the spot market.

Operating loss for the full year 2021 was $29.1 million, compared to operating income of $58.6 million for the full year 2020. The prior year included a gain on termination of a pre-existing arrangement related to the acquisition of the Alaska Tanker Company.

Net loss for the full year 2021 was $46.3 million, or $(0.51) per diluted share, compared with net income of $30.0 million, or $0.33 per diluted share, for the full year 2020.

Adjusted EBITDA was $45.1 million for the full year 2021, a decrease of $79.8 million compared with the full year 2020.

Conference Call

The Company will host a conference call to discuss its fourth quarter and full year 2021 results at 9:30 a.m. Eastern Time (“ET”) on Wednesday, March 9, 2022.

To access the call, participants should dial (844) 850-0546 for domestic callers and (412) 317-5203 for international callers. Please dial in ten minutes prior to the start of the call.

A live webcast of the conference call will be available from the Investor Relations section of the Company’s website at http://www.osg.com/.

An audio replay of the conference call will be available for one week starting at 11:30 a.m. ET on Wednesday, March 9, 2022 by dialing (877) 344-7529 for domestic callers and (412) 317-0088 for international callers, and entering Access Code 8908564.

About Overseas Shipholding Group, Inc.

Overseas Shipholding Group, Inc. (NYSE:OSG) is a publicly traded company providing energy transportation services for crude oil and petroleum products in the U.S. Flag markets. OSG is a major operator of tankers and ATBs in the Jones Act industry. OSG’s 22 vessel U.S. Flag fleet consists of three crude oil tankers doing business in Alaska, two conventional ATBs, two lightering ATBs, three shuttle tankers, ten MR tankers, and two non-Jones Act MR tankers that participate in the U.S. Maritime Security Program. OSG also currently owns and operates one Marshall Islands flagged MR tanker which trades internationally.

OSG is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world’s most customer-focused marine transportation companies and is headquartered in Tampa, FL. More information is available at www.osg.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, the Company may make or approve certain forward-looking statements in future filings with the Securities and Exchange Commission (SEC), in press releases or in oral or written presentations by representatives of the Company. All statements other than statements of historical facts should be considered forward-looking statements. These matters or statements may relate to our prospects, supply and demand for vessels in the markets in which we operate and the impact on market rates and vessel earnings, the continued stability of our niche businesses, the impact of our time charter contracts on our future financial performance, and such external events such as geopolitical conflicts. Forward-looking statements are based on our current plans, estimates and projections, and are subject to change based on a number of factors. COVID-19 has had, and will continue to have, a profound impact on our workforce and many other aspects of our business and industry. Investors should carefully consider the risk factors outlined in more detail in our filings with the SEC. We do not assume any obligation to update or revise any forward-looking statements except as may be required by applicable law. Forward-looking statements and written and oral forward-looking statements attributable to us or our representatives after the date of this press release are qualified in their entirety by the cautionary statements contained in this paragraph and in other reports previously or hereafter filed by us with the SEC.

Consolidated Statements of Operations

($ in thousands, except per share amounts)

 

 

 

Three Months Ended
December 31,

 

 

Years Ended
December 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Shipping Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time and bareboat charter revenues

 

$

63,615

 

 

$

80,427

 

 

$

254,744

 

 

$

344,512

 

Voyage charter revenues

 

 

31,848

 

 

 

17,119

 

 

 

104,318

 

 

 

74,180

 

 

 

 

95,463

 

 

 

97,546

 

 

 

359,062

 

 

 

418,692

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Voyage expenses

 

 

15,437

 

 

 

11,448

 

 

 

66,467

 

 

 

42,813

 

Vessel expenses

 

 

38,598

 

 

 

39,009

 

 

 

140,413

 

 

 

159,466

 

Charter hire expenses

 

 

22,447

 

 

 

22,861

 

 

 

90,166

 

 

 

90,608

 

Depreciation and amortization

 

 

15,910

 

 

 

15,024

 

 

 

61,823

 

 

 

58,513

 

Bad debt recovery

 

 

(1,080

)

 

 

 

 

 

(1,080

)

 

 

 

General and administrative

 

 

6,021

 

 

 

6,957

 

 

 

24,097

 

 

 

26,869

 

Loss on disposal of vessels and other property, including impairments, net

 

 

19

 

 

 

24

 

 

 

6,276

 

 

 

982

 

Total operating expenses

 

 

97,352

 

 

 

95,323

 

 

 

388,162

 

 

 

379,251

 

(Loss)/income from vessel operations

 

 

(1,889

)

 

 

2,223

 

 

 

(29,100

)

 

 

39,441

 

Gain on termination of pre-existing arrangement

 

 

 

 

 

 

 

 

 

 

 

19,172

 

Operating (loss)/income

 

 

(1,889

)

 

 

2,223

 

 

 

(29,100

)

 

 

58,613

 

Loss on extinguishment of debt, net

 

 

(70

)

 

 

 

 

 

(8,031

)

 

 

(793

)

Other income, net

 

 

1,845

 

 

 

1,808

 

 

 

1,985

 

 

 

2,414

 

(Loss)/income before interest expense and income taxes

 

 

(114

)

 

 

4,031

 

 

 

(35,146

)

 

 

60,234

 

Interest expense

 

 

(8,464

)

 

 

(5,902

)

 

 

(29,203

)

 

 

(24,045

)

(Loss)/income before income taxes

 

 

(8,578

)

 

 

(1,871

)

 

 

(64,349

)

 

 

36,189

 

Income tax benefit/(expense)

 

 

4,902

 

 

 

1,027

 

 

 

18,097

 

 

 

(6,185

)

Net (loss)/income

 

$

(3,676

)

 

$

(844

)

 

$

(46,252

)

 

$

30,004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Common Shares Outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic - Class A

 

 

90,807,935

 

 

 

90,004,773

 

 

 

90,587,454

 

 

 

89,794,392

 

Diluted - Class A

 

 

90,807,935

 

 

 

90,004,773

 

 

 

90,587,454

 

 

 

90,838,262

 

Per Share Amounts:

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net (loss)/income - Class A

 

$

(0.03

)

 

$

(0.01

)

 

$

(0.51

)

 

$

0.33

 

 

Consolidated Balance Sheets

($ in thousands)

 

 

 

December 31, 2021

 

 

December 31, 2020

 

ASSETS

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

83,172

 

 

$

69,697

 

Restricted cash

 

 

37

 

 

 

49

 

Voyage receivables, including unbilled of $3,777 and $6,740, net of reserve for doubtful accounts

 

 

14,586

 

 

 

13,123

 

Income tax receivable

 

 

1,882

 

 

 

387

 

Other receivables

 

 

5,816

 

 

 

1,817

 

Prepaid expenses

 

 

543

 

 

 

1,310

 

Inventories and other current assets

 

 

2,895

 

 

 

2,293

 

Total Current Assets

 

 

108,931

 

 

 

88,676

 

Vessels and other property, less accumulated depreciation

 

 

761,777

 

 

 

832,174

 

Deferred drydock expenditures, net

 

 

43,342

 

 

 

43,134

 

Total Vessels, Other Property and Deferred Drydock

 

 

805,119

 

 

 

875,308

 

Restricted cash - non current

 

 

44

 

 

 

73

 

Intangible assets, less accumulated amortization

 

 

22,617

 

 

 

27,217

 

Operating lease right-of-use assets, net

 

 

152,027

 

 

 

215,817

 

Other assets

 

 

26,991

 

 

 

24,646

 

Total Assets

 

$

1,115,729

 

 

$

1,231,737

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

Accounts payable, accrued expenses and other current liabilities

 

$

49,901

 

 

$

48,089

 

Current installments of long-term debt

 

 

22,225

 

 

 

38,922

 

Current portion of operating lease liabilities

 

 

100,010

 

 

 

90,613

 

Current portion of finance lease liabilities

 

 

4,000

 

 

 

4,000

 

Total Current Liabilities

 

 

176,136

 

 

 

181,624

 

Reserve for uncertain tax positions

 

 

179

 

 

 

189

 

Long-term debt, net

 

 

422,515

 

 

 

390,198

 

Deferred income taxes, net

 

 

63,744

 

 

 

80,992

 

Noncurrent operating lease liabilities

 

 

73,150

 

 

 

147,154

 

Noncurrent finance lease liabilities

 

 

18,998

 

 

 

21,360

 

Other liabilities

 

 

22,393

 

 

 

30,409

 

Total Liabilities

 

 

777,115

 

 

 

851,926

 

Equity:

 

 

 

 

 

 

Common stock - Class A ($0.01 par value; 166,666,666 shares
authorized; 87,170,463 and 86,365,422 shares issued and outstanding)

 

 

872

 

 

 

864

 

Paid-in additional capital

 

 

594,386

 

 

 

592,564

 

Accumulated deficit

 

 

(259,587

)

 

 

(213,335

)

 

 

 

335,671

 

 

 

380,093

 

Accumulated other comprehensive income/(loss)

 

 

2,943

 

 

 

(282

)

Total Equity

 

 

338,614

 

 

 

379,811

 

Total Liabilities and Equity

 

$

1,115,729

 

 

$

1,231,737

 

 

Consolidated Statements of Cash Flows

($ in thousands)

 

 

 

Years Ended December 31,

 

 

 

2021

 

 

2020

 

Cash Flows from Operating Activities:

 

 

 

 

 

 

Net (loss)/income

 

$

(46,252

)

 

$

30,004

 

Items included in net income not affecting cash flows:

 

 

 

 

 

 

Depreciation and amortization

 

 

61,823

 

 

 

58,513

 

Bad debt recovery

 

 

(1,080

)

 

 

 

Gain on termination of pre-existing arrangement

 

 

 

 

 

(19,172

)

Amortization of debt discount and other deferred financing costs

 

 

2,099

 

 

 

2,286

 

Compensation relating to restricted stock, stock unit and stock option grants

 

 

2,232

 

 

 

2,333

 

Deferred income tax (benefit)/expense

 

 

(18,236

)

 

 

6,298

 

Interest on finance lease liabilities

 

 

1,799

 

 

 

1,973

 

Non-cash operating lease expense

 

 

90,863

 

 

 

91,696

 

Distributed earnings of affiliated companies

 

 

 

 

 

3,562

 

Items included in net income related to investing and financing activities:

 

 

 

 

 

 

Loss on extinguishment and prepayments of debt, net

 

 

5,295

 

 

 

793

 

Loss on disposal of vessels and other property, including impairments, net

 

 

6,276

 

 

 

982

 

Payments for drydocking

 

 

(19,037

)

 

 

(30,732

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Operating lease liabilities

 

 

(92,634

)

 

 

(92,753

)

Increase in receivables

 

 

(384

)

 

 

(3,876

)

(Decrease)/increase in income tax receivable

 

 

(1,495

)

 

 

6,133

 

Increase/(decrease) in deferred revenue

 

 

9,666

 

 

 

(2,903

)

Net change in other operating assets and liabilities

 

 

(12,767

)

 

 

(2,469

)

Net cash (used in)/provided by operating activities

 

 

(11,832

)

 

 

52,668

 

Cash Flows from Investing Activities:

 

 

 

 

 

 

Acquisition, net of cash acquired

 

 

 

 

 

(16,973

)

Expenditures for vessels and vessel improvements

 

 

(7,793

)

 

 

(62,586

)

Proceeds from disposal of vessels and other property

 

 

32,128

 

 

 

1,407

 

Net cash provided by/(used in) investing activities

 

 

24,335

 

 

 

(78,152

)

Cash Flows from Financing Activities:

 

 

 

 

 

 

Extinguishment of debt and prepayments

 

 

(277,520

)

 

 

(41,021

)

Issuance of debt, net of issuance and deferred financing costs

 

 

321,531

 

 

 

143,949

 

Payments on debt

 

 

(33,316

)

 

 

(44,933

)

Tax withholding on share-based awards

 

 

(402

)

 

 

(197

)

Payments on principal portion of finance lease liabilities

 

 

(4,161

)

 

 

(4,172

)

Extinguishment of debt costs paid

 

 

(2,736

)

 

 

 

Deferred financing costs paid for debt amendments

 

 

(2,465

)

 

 

 

Net cash provided by financing activities

 

 

931

 

 

 

53,626

 

Net increase in cash, cash equivalents and restricted cash

 

 

13,434

 

 

 

28,142

 

Cash, cash equivalents and restricted cash at beginning of year

 

 

69,819

 

 

 

41,677

 

Cash, cash equivalents and restricted cash at end of year

 

$

83,253

 

 

$

69,819

 

Spot and Fixed TCE Rates Achieved and Revenue Days

The following tables provide a breakdown of TCE rates achieved for spot and fixed charters and the related revenue days for the three months and fiscal year ended December 31, 2021 and the comparable periods of 2020. Revenue days in the quarter ended December 31, 2021 totaled 1,597 compared with 1,756 in the prior year quarter. Revenue days in the fiscal year ended December 31, 2021 totaled 6,064 compared with 7,639 in the prior year. A summary fleet list by vessel class can be found later in this press release.

 

 

2021

 

 

2020

 

For the three months ended December 31,

 

Spot
Earnings

 

 

Fixed
Earnings

 

 

Spot
Earnings

 

 

Fixed
Earnings

 

Jones Act Handysize Product Carriers:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

39,841

 

 

$

65,541

 

 

$

1,712

 

 

$

62,935

 

Revenue days

 

 

294

 

 

 

476

 

 

 

111

 

 

 

828

 

Non-Jones Act Handysize Product Carriers:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

32,015

 

 

$

12,700

 

 

$

34,076

 

 

$

11,093

 

Revenue days

 

 

184

 

 

 

92

 

 

 

205

 

 

 

162

 

ATBs:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

 

 

$

34,802

 

 

$

 

 

$

30,056

 

Revenue days

 

 

 

 

 

183

 

 

 

 

 

 

116

 

Lightering:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

72,007

 

 

$

 

 

$

75,162

 

 

$

 

Revenue days

 

 

92

 

 

 

 

 

 

89

 

 

 

 

Alaska (a):

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

 

 

$

60,496

 

 

$

 

 

$

58,987

 

Revenue days

 

 

 

 

 

276

 

 

 

 

 

 

245

 

 

 

2021

 

 

2020

 

For the years ended December 31,

 

Spot
Earnings

 

 

Fixed
Earnings

 

 

Spot
Earnings

 

 

Fixed
Earnings

 

Jones Act Handysize Product Carriers:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

34,985

 

 

$

65,794

 

 

$

24,568

 

 

$

61,411

 

Revenue days

 

 

843

 

 

 

1,856

 

 

 

359

 

 

 

3,889

 

Non-Jones Act Handysize Product Carriers:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

31,017

 

 

$

10,048

 

 

$

30,582

 

 

$

15,213

 

Revenue days

 

 

735

 

 

 

520

 

 

 

699

 

 

 

710

 

ATBs:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

 

 

$

33,849

 

 

$

16,987

 

 

$

28,536

 

Revenue days

 

 

 

 

 

727

 

 

 

277

 

 

 

291

 

Lightering:

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

73,624

 

 

$

 

 

$

56,003

 

 

$

61,012

 

Revenue days

 

 

365

 

 

 

 

 

 

476

 

 

 

87

 

Alaska (a):

 

 

 

 

 

 

 

 

 

 

 

 

Average rate

 

$

 

 

$

59,002

 

 

$

 

 

$

58,742

 

Revenue days

 

 

 

 

 

1,018

 

 

 

 

 

 

851

 

 

(a) Excludes one Alaska vessel currently in layup.

 

Fleet Information

As of December 31, 2021, OSG’s operating fleet consisted of 24 vessels, 12 of which were owned, with the remaining vessels chartered-in. Vessels chartered-in are on Bareboat Charters.

 

 

Vessels Owned

 

 

Vessels
Chartered-In

 

 

Total at December 31, 2021

 

Vessel Type

 

Number

 

 

Number

 

 

Total Vessels

 

 

Total dwt (3)

 

Handysize Product Carriers (1)

 

 

5

 

 

 

11

 

 

 

16

 

 

 

760,493

 

Crude Oil Tankers (2)

 

 

3

 

 

 

1

 

 

 

4

 

 

 

772,194

 

Refined Product ATBs

 

 

2

 

 

 

 

 

 

2

 

 

 

54,182

 

Lightering ATBs

 

 

2

 

 

 

 

 

 

2

 

 

 

91,112

 

Total Operating Fleet

 

 

12

 

 

 

12

 

 

 

24

 

 

 

1,677,981

 

 

(1) Includes two owned shuttle tankers, 11 chartered-in tankers, and two non-Jones Act MR tankers that participate in the U.S. Maritime Security Program, all of which are U.S. flagged, as well as one owned Marshall Island flagged non-Jones Act MR tanker trading in international markets.
(2) Includes three crude oil tankers doing business in Alaska and one crude oil tanker bareboat chartered-in and in layup.
(3) Total dwt is defined as aggregate deadweight tons for all vessels of that type.

Reconciliation to Non-GAAP Financial Information

The Company believes that, in addition to conventional measures prepared in accordance with GAAP, the following non-GAAP measures provide investors with additional information that will better enable them to evaluate the Company’s performance. Accordingly, these non-GAAP measures are intended to provide supplemental information, and should not be considered in isolation or as a substitute for measures of performance prepared with GAAP.

(A) Time Charter Equivalent (TCE) Revenues

Consistent with general practice in the shipping industry, the Company uses TCE revenues, which represents shipping revenues less voyage expenses, as a measure to compare revenue generated from a voyage charter to revenue generated from a time charter. TCE revenues, a non-GAAP measure, provides additional meaningful information in conjunction with shipping revenues, the most directly comparable GAAP measure, because it assists Company management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance. Reconciliation of TCE revenues of the segments to shipping revenues as reported in the consolidated statements of operations follows:

 

 

Three Months Ended
December 31,

 

 

Years Ended
December 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Time charter equivalent revenues

 

$

80,026

 

 

$

86,098

 

 

$

292,595

 

 

$

375,879

 

Add: Voyage expenses

 

 

15,437

 

 

 

11,448

 

 

 

66,467

 

 

 

42,813

 

Shipping revenues

 

$

95,463

 

 

$

97,546

 

 

$

359,062

 

 

$

418,692

 

Vessel Operating Contribution

Vessel operating contribution, a non-GAAP measure, is TCE revenues minus vessel expenses and charter hire expenses.

 

 

Three Months Ended
December 31,

 

 

Years Ended
December 31,

 

($ in thousands)

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Niche market activities

 

$

15,472

 

 

$

18,313

 

 

$

62,585

 

 

$

79,826

 

Jones Act handysize tankers

 

 

(8,720

)

 

 

(2,464

)

 

 

(44,415

)

 

 

15,670

 

ATBs

 

 

3,981

 

 

 

1,335

 

 

 

15,384

 

 

 

4,658

 

Alaska crude oil tankers

 

 

8,248

 

 

 

7,044

 

 

 

28,462

 

 

 

25,651

 

Vessel operating contribution

 

 

18,981

 

 

 

24,228

 

 

 

62,016

 

 

 

125,805

 

Depreciation and amortization

 

 

15,910

 

 

 

15,024

 

 

 

61,823

 

 

 

58,513

 

Bad debt recovery

 

 

(1,080

)

 

 

 

 

 

(1,080

)

 

 

 

General and administrative

 

 

6,021

 

 

 

6,957

 

 

 

24,097

 

 

 

26,869

 

Loss on disposal of vessels and other property, including impairments, net

 

 

19

 

 

 

24

 

 

 

6,276

 

 

 

982

 

(Loss)/income from vessel operations

 

$

(1,889

)

 

$

2,223

 

 

$

(29,100

)

 

$

39,441

 

(B) EBITDA and Adjusted EBITDA

EBITDA represents net income/(loss) before interest expense, income taxes and depreciation and amortization expense. Adjusted EBITDA consists of EBITDA adjusted to exclude amortization classified in charter hire expenses, interest expense classified in charter hire expenses, loss/(gain) on disposal of vessels and other property, including impairments, net, non-cash stock based compensation expense and loss on repurchases and extinguishment of debt and the impact of other items that we do not consider indicative of our ongoing operating performance. EBITDA and Adjusted EBITDA do not represent, and should not be a substitute for, net income/(loss) or cash flows from operations as determined in accordance with GAAP. Some of the limitations are: (i) EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; (ii) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; and (iii) EBITDA and Adjusted EBITDA do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our debt. While EBITDA and Adjusted EBITDA are frequently used as a measure of operating results and performance, neither of them is necessarily comparable to other similarly titled measures used by other companies due to differences in methods of calculation. The following table reconciles net income/(loss) as reflected in the consolidated statements of operations, to EBITDA and Adjusted EBITDA.

 

 

Three Months Ended
December 31,

 

 

Years Ended
December 31,

 

($ in thousands)

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net (loss)/income

 

$

(3,676

)

 

$

(844

)

 

$

(46,252

)

 

$

30,004

 

Income tax (benefit)/expense

 

 

(4,902

)

 

 

(1,027

)

 

 

(18,097

)

 

 

6,185

 

Interest expense

 

 

8,464

 

 

 

5,902

 

 

 

29,203

 

 

 

24,045

 

Depreciation and amortization

 

 

15,910

 

 

 

15,024

 

 

 

61,823

 

 

 

58,513

 

EBITDA

 

 

15,796

 

 

 

19,055

 

 

 

26,677

 

 

 

118,747

 

Amortization classified in charter hire expenses

 

 

143

 

 

 

143

 

 

 

570

 

 

 

570

 

Interest expense classified in charter hire expenses

 

 

330

 

 

 

360

 

 

 

1,354

 

 

 

1,477

 

Loss on disposal of vessels and other property, including impairments, net

 

 

19

 

 

 

24

 

 

 

6,276

 

 

 

982

 

Non-cash stock based compensation expense

 

 

244

 

 

 

646

 

 

 

2,232

 

 

 

2,332

 

Loss on extinguishment of debt, net

 

 

70

 

 

 

290

 

 

 

8,031

 

 

 

793

 

Adjusted EBITDA

 

$

16,602

 

 

$

20,518

 

 

$

45,140

 

 

$

124,901

 

(C) Total Cash

($ in thousands)

 

December 31,
2021

 

 

December 31,
2020

 

Cash and cash equivalents

 

$

83,172

 

 

$

69,697

 

Restricted cash - current

 

 

37

 

 

 

49

 

Restricted cash – non-current

 

 

44

 

 

 

73

 

Total cash

 

$

83,253

 

 

$

69,819

 

Category: Earnings

Contacts

Investor Relations & Media Contact:
Susan Allan, Overseas Shipholding Group, Inc.
(813) 209-0620
sallan@osg.com

Release Summary

Overseas Shipholding Group Reports Fourth Quarter and Full Year 2021 Results

Contacts

Investor Relations & Media Contact:
Susan Allan, Overseas Shipholding Group, Inc.
(813) 209-0620
sallan@osg.com