Euroseas reports results for the year and quarter ended December 31, 2012
Euroseas Ltd., an owner and operator of drybulk and container carrier vessels and provider of seaborne transportation for drybulk and containerized cargoes, announced today its results for the three month period and full year ended December 31, 2012, the company reports.
For the twelve months of 2012, the company reported total net revenues of $52.5 million representing a 14.5% decrease over total net revenues of $61.4 million during the twelve months of 2011. The company reported net loss for the period of $13.2 million as compared to net income of $1.1 million for the twelve months of 2011. The results for the twelve months of 2012 include a $1.1 million net unrealized gain on derivatives, a $1.7 million net realized loss on derivatives and $8.6 million loss on sale of a vessel, as compared to a $0.9 million net unrealized loss on derivatives and trading securities, $0.8 million net realized loss on derivatives and $1.3 million loss on amortization of fair value of charters acquired for the same period of 2011.
Depreciation expense for the twelve months of 2012 was $17.4 million compared to $18.3 million during the same period of 2011. On average, 15.21 vessels were owned and operated during the twelve months of 2012 earning an average time charter equivalent rate of $10,155 per day compared to 16.00 vessels in the same period of 2011 earning an average time charter equivalent rate of $11,525 per day.
Adjusted EBITDA for the twelve months of 2012 was $14.9 million, a 31.0% decrease from $21.6 million achieved during the twelve months of 2011. Basic and diluted net loss per share for the twelve months of 2012 was $0.34, calculated on 38,950,100 basic and diluted weighted average number of shares outstanding, compared to earnings per share of $0.04 basic and diluted for the twelve months of 2011, calculated on 31,794,381 basic and 31,846,080 diluted weighted average number of shares outstanding, respectively.
Excluding the effect on the losses for 2012 of the net unrealized gain on derivatives and trading securities, realized loss on derivatives and the loss on sale of a vessel, the adjusted loss per share for the year ended December 31, 2012 would have been $0.10 per share basic and diluted compared to earnings of $0.05 per share for the year ended December 31, 2011. Usually, security analysts do not include the above items in their published estimates of earnings per share.
Aristides Pittas, Chairman and CEO of Euroseas commented: "Containership and drybulk markets remained depressed during the fourth quarter of 2012 and year-to-date 2013 due to slow demand growth and abundant vessel supply. More vessel deliveries scheduled during 2013, mirroring orders placed up to mid- 2011, are expected to make this year a challenging one as well as only modest world economic growth, and thus seaborne trade growth, is expected.
"Our drybulk fleet charters which provided us with significant cash flow contributions during 2012 are gradually due for renewal in 2013. We decided to put the first drybulk vessel that concluded its charter, Eleni P, into the Baumarine panamax bulker pool where we expect her to be earning spot market rates. We believe that the drybulk charter market will remain depressed in 2013 and would expect to see a modest recovery in 2014, therefore we do not intend to be chartering any of our drybulk vessels for a period more than a year. All but one of our containerships are employed at low market rates and ships coming up for renewals will probably be chartered for periods up to a year too. We remain optimistic that this market will also bottom out by the second half of 2013.
"On the investment front, we expect that very attractive vessel opportunities will be available during 2013 and we thoroughly monitor the secondhand markets. Our strong balance sheet and cash reserves allows us the comfort of being in a position to weather a difficult year without forgoing investment in additional vessels or the renewal of our fleet.
"Our Board decided to maintain our quarterly dividend to $0.015 per share which represents an annual yield of about 6.0% on the basis of our stock price on February 13, 2013."
Tasos Aslidis, Chief Financial Officer of Euroseas commented: "The results of the fourth quarter of 2012 reflect the challenging state of the market which influenced the charter rates earned by our containership vessels. Additionally, the drydocking of two of our vessels and our share of the loss of our Euromar joint venture influenced our fourth quarter results. Our vessels earned on average about $2,500 per day per vessel less in the fourth quarter of 2012 as compared to the fourth quarter of 2011 resulting in a net loss of $2.0 million versus a net income of $1.1 million in the fourth quarter of last year.
"Total daily vessel operating expenses, including management fees, general and administrative expenses, excluding drydocking costs, increase approximately 4.7% during the fourth quarter of 2012 compared to the same quarter of last year while for the full year 2012 the increase was approximately 1.0% over 2011; Drydocking expenses expressed on a per vessel per day basis were lower by 46.2% for the full year 2012 and higher by 187.7% for the fourth quarter of 2012 as compared to the same periods in 2011 and were a function of the number of vessels undergoing drydocking in the respective periods. As always, we want to emphasize that cost control remains a key component of our strategy, especially, at depressed markets like at present.
"As of December 31, 2012, our outstanding debt was $61.6 million versus restricted and unrestricted cash of approximately $43.3 million. Our scheduled debt repayments over the next 12 months amounted to about $20.9 million which includes approximately $9.9 million of balloon repayments which we are considering refinancing. We were in compliance with all our debt covenants as of December 31, 2012."
Fourth Quarter 2012 Results:
For the fourth quarter of 2012, the company reported total net revenues of $12.4 million representing an 18.9% decrease over total net revenues of $15.3 million during the fourth quarter of 2011. The company reported a net loss for the period of $2.0 million as compared to net income of $1.1 million for the fourth quarter of 2011. The results for the fourth quarter of 2012 include a $0.4 million net unrealized gain on derivatives and a $0.4 million net realized loss on derivatives as compared to $0.3 million net unrealized gain on derivatives and trading securities and $0.3 million realized loss on derivatives for the same period of 2011.
Depreciation expense for the fourth quarter of 2012 was $4.3 million, as compared to the $4.6 million of the same period of 2011. On average, 15.00 vessels were owned and operated during the fourth quarter of 2012 earning an average time charter equivalent rate of $9,510 per day compared to 16.00 vessels in the same period of 2011 earning an average time charter equivalent rate of $12,099 per day.
Adjusted EBITDA for the fourth quarter of 2012 was $2.5 million, a 59.7% decrease from $6.2 million achieved during the fourth quarter of 2011. Basic and diluted loss per share for the fourth quarter of 2012 was $0.04, calculated on 45,265,155 basic and diluted weighted average number of shares outstanding, compared to $0.03 earnings per share for the fourth quarter of 2011, calculated on 31,867,856 basic and 31,902,950 diluted weighted average number of shares outstanding, respectively.
Excluding the effect on the earnings for the quarter ended December 31, 2012 of the unrealized gain and the realized loss on derivatives the loss per share would have remained unchanged at $0.04 per share basic and diluted compared to earnings of $0.04 per share for the quarter ended December 31, 2011. Usually, security analysts do not include the above items in their published estimates of earnings per share.