Seaspan, the Hong Kong charter ship owner, posted a loss of $65.9 million for the third quarter ended Sept. 30, which was almost 13 times the loss in the same quarter last year even as its revenue increased by 28.6 percent to $74.1 million for the quarter.
Seaspan said it recorded losses for both this year’s and last year’s third quarters because of unrealized losses from interest rate swaps of $92.6 million in this year’s quarter and $24.7 million in the same quarter last year.
Seaspan said that after both quarters are normalized to exclude the effect of interest rate swaps, it earned a profit of $20.2 million in this year’s quarter, an increase of 6.5 percent. Normalized net earnings are not defined by accounting principles generally accepted in the United States.
While Seaspan accepted delivery of two new containerships in the quarter, the weak charter market led it to exercise options to defer the delivery date for 11 of the vessels that it had ordered for periods ranging from two to 15 months from the dates agreed to under the original shipbuilding contracts.
It also deferred the delivery date for two additional vessels for approximately nine months from the dates that were agreed to under the original shipbuilding contracts.
Vessel operating days increased 28 percent to 3,612 days for the quarter.
The company estimated it owes about $1.8 billion in remaining installment payments for the 27 vessels on order but not yet delivered. It said it has secured long term credit facilities to fund the new vessels and does not have any credit facilities maturing until 2015.
It said it intends to raise between $180 million and $240 million in common stock or other forms of capital to pay for the new ships starting in approximately the fourth quarter of 2010 or first quarter of 2011 and ending in approximately second quarter 2012.
But it also said the current state of the global financial markets and current economic conditions may adversely impact its ability to issue additional equity at prices which will not be dilutive to shareholders.
Seaspan said it is pursuing alternative financing that will allow it to defer or eliminate some or all of its current equity needs.
Seaspan said it recorded losses for both this year’s and last year’s third quarters because of unrealized losses from interest rate swaps of $92.6 million in this year’s quarter and $24.7 million in the same quarter last year.
Seaspan said that after both quarters are normalized to exclude the effect of interest rate swaps, it earned a profit of $20.2 million in this year’s quarter, an increase of 6.5 percent. Normalized net earnings are not defined by accounting principles generally accepted in the United States.
While Seaspan accepted delivery of two new containerships in the quarter, the weak charter market led it to exercise options to defer the delivery date for 11 of the vessels that it had ordered for periods ranging from two to 15 months from the dates agreed to under the original shipbuilding contracts.
It also deferred the delivery date for two additional vessels for approximately nine months from the dates that were agreed to under the original shipbuilding contracts.
Vessel operating days increased 28 percent to 3,612 days for the quarter.
The company estimated it owes about $1.8 billion in remaining installment payments for the 27 vessels on order but not yet delivered. It said it has secured long term credit facilities to fund the new vessels and does not have any credit facilities maturing until 2015.
It said it intends to raise between $180 million and $240 million in common stock or other forms of capital to pay for the new ships starting in approximately the fourth quarter of 2010 or first quarter of 2011 and ending in approximately second quarter 2012.
But it also said the current state of the global financial markets and current economic conditions may adversely impact its ability to issue additional equity at prices which will not be dilutive to shareholders.
Seaspan said it is pursuing alternative financing that will allow it to defer or eliminate some or all of its current equity needs.