Scorpio Tankers Inc. yesterday reported its results for the three months ended March 31, 2011.The Company recorded a net loss of $1.4 million or $0.06 basic and diluted loss per share for the three months ended March 31, 2011 compared to net income of $1.2 million or $0.21 basic and diluted earnings per share for the three months ended March 31, 2010. The weighted average number of shares outstanding was 24,066,455 (basic and diluted) for the three months ended March 31, 2011, and 5,589,147 (basic and diluted) for the three months ended March 31, 2010.
Emanuele Lauro, chief executive officer and chairman of the board, commented, "We are beginning to see signs of a recovery as TCE rates have improved for product tankers, and particularly in the smaller ships. Though the breadth and duration remains unclear, it is welcome news that validates our strategy of pursuing growth in the product tanker market."
Mr. Lauro further commented, "With the delivery of STI Coral and STI Diamond, along with the signing of a new $150 million credit facility, we continue to demonstrate our commitment to growing at a swift, but sensible pace in this market."
Recent Highlights
Delivery of STI Coral and STI Diamond
On May 10, 2011, Scorpio Tankers took delivery of the STI Coral and STI Diamond, product tankers that we previously agreed to acquire for an aggregate purchase price of $70.0 million. The ships were built in 2008 at the STX shipyard in Korea and are charter free.
Time charter-in agreement
On April 5, 2011, the Company entered into a time charter agreement for a 2007 built Handymax ice class 1B product tanker, the Kazdanga. This vessel will be chartered-in for one year at $12,345 per day and is expected to be delivered in June 2011. The agreement includes an option to extend the charter for an additional year at $13,335 per day.
New $150 Million Credit Facility (2011 Credit Facility)
On May 4, 2011, the Company executed a credit facility with Nordea Bank Finland plc, acting through its New York branch, DnB NOR Bank ASA, acting through its New York branch, and ABN AMRO Bank N.V. for a senior secured term loan facility of up to $150 million ("2011 Credit Facility"). Borrowings under the 2011 Credit Facility are available until May 3, 2012. The credit facility matures in six years and will be used to finance up to 50% of the cost of future vessel acquisitions, which vessels would be the collateral for the credit facility.
On May 6, 2011, we drew down an aggregate of $35 million to finance the delivery of STI Coral and STI Diamond.
1st Quarter Highlights
Delivery of time chartered-in vessels
On January 26, 2011, the Company took delivery of Kraslava, a 2007 built Handymax ice-class 1B product tanker, which we previously agreed to time charter-in. This vessel was chartered-in for one year at $12,070 per day.
On February 6, 2011, Scorpio Tankers took delivery of Histria Azure, a 2007 built Handymax product tanker, which we previously agreed to time charter-in. This vessel was chartered-in for one year at $12,250 per day. The agreement includes an option for Scorpio Tankers to extend for an additional year at $13,750 per day or $12,250 per day with a 50% profit sharing agreement.
On March 1, 2011, the Company took delivery of Krisjanis Valdemars, a 2007 built Handymax ice-class 1B product tanker, which the Company previously agreed to time charter-in. This vessel was chartered-in for 10 months at $12,000 per day. The agreement also includes a profit and loss sharing provision whereby 50% of all profits and losses (the difference between the vessel's pool earnings and the charter hire expense) will be shared with the owner of the vessel.
STI Spirit Credit Facility
On March 17, 2011, Scorpio Tankers drew down $27.3 million from a senior secured term loan facility with DVB Bank SE. The loan is secured by the STI Spirit, which was acquired on November 10, 2010. The credit facility matures on March 17, 2018, and the loan bears interest at LIBOR plus a margin of 2.75% per annum. The loan will be repaid over 28 equal quarterly installments and a lump sum payment at maturity. The quarterly installments, which commence three months after the drawdown, are calculated using an 18 year amortization profile.
Emanuele Lauro, chief executive officer and chairman of the board, commented, "We are beginning to see signs of a recovery as TCE rates have improved for product tankers, and particularly in the smaller ships. Though the breadth and duration remains unclear, it is welcome news that validates our strategy of pursuing growth in the product tanker market."
Mr. Lauro further commented, "With the delivery of STI Coral and STI Diamond, along with the signing of a new $150 million credit facility, we continue to demonstrate our commitment to growing at a swift, but sensible pace in this market."
Recent Highlights
Delivery of STI Coral and STI Diamond
On May 10, 2011, Scorpio Tankers took delivery of the STI Coral and STI Diamond, product tankers that we previously agreed to acquire for an aggregate purchase price of $70.0 million. The ships were built in 2008 at the STX shipyard in Korea and are charter free.
Time charter-in agreement
On April 5, 2011, the Company entered into a time charter agreement for a 2007 built Handymax ice class 1B product tanker, the Kazdanga. This vessel will be chartered-in for one year at $12,345 per day and is expected to be delivered in June 2011. The agreement includes an option to extend the charter for an additional year at $13,335 per day.
New $150 Million Credit Facility (2011 Credit Facility)
On May 4, 2011, the Company executed a credit facility with Nordea Bank Finland plc, acting through its New York branch, DnB NOR Bank ASA, acting through its New York branch, and ABN AMRO Bank N.V. for a senior secured term loan facility of up to $150 million ("2011 Credit Facility"). Borrowings under the 2011 Credit Facility are available until May 3, 2012. The credit facility matures in six years and will be used to finance up to 50% of the cost of future vessel acquisitions, which vessels would be the collateral for the credit facility.
On May 6, 2011, we drew down an aggregate of $35 million to finance the delivery of STI Coral and STI Diamond.
1st Quarter Highlights
Delivery of time chartered-in vessels
On January 26, 2011, the Company took delivery of Kraslava, a 2007 built Handymax ice-class 1B product tanker, which we previously agreed to time charter-in. This vessel was chartered-in for one year at $12,070 per day.
On February 6, 2011, Scorpio Tankers took delivery of Histria Azure, a 2007 built Handymax product tanker, which we previously agreed to time charter-in. This vessel was chartered-in for one year at $12,250 per day. The agreement includes an option for Scorpio Tankers to extend for an additional year at $13,750 per day or $12,250 per day with a 50% profit sharing agreement.
On March 1, 2011, the Company took delivery of Krisjanis Valdemars, a 2007 built Handymax ice-class 1B product tanker, which the Company previously agreed to time charter-in. This vessel was chartered-in for 10 months at $12,000 per day. The agreement also includes a profit and loss sharing provision whereby 50% of all profits and losses (the difference between the vessel's pool earnings and the charter hire expense) will be shared with the owner of the vessel.
STI Spirit Credit Facility
On March 17, 2011, Scorpio Tankers drew down $27.3 million from a senior secured term loan facility with DVB Bank SE. The loan is secured by the STI Spirit, which was acquired on November 10, 2010. The credit facility matures on March 17, 2018, and the loan bears interest at LIBOR plus a margin of 2.75% per annum. The loan will be repaid over 28 equal quarterly installments and a lump sum payment at maturity. The quarterly installments, which commence three months after the drawdown, are calculated using an 18 year amortization profile.