Globus Maritime Reports Financial Results for the Quarter and Six Months Ended June 30, 2012
Athens, Greece, September 10, 2012
Globus Maritime Limited ("Globus," the “Company," “we,” or “our”), (NASDAQ: GLBS), a dry bulk shipping company, today reported its unaudited consolidated operating and financial results for the three-month and six-month periods ended June 30, 2012.
Summary of Second Quarter 2012 Results versus Second Quarter 2011
• Revenue of $7.7 million versus $7.8 million, a 1% decrease;
• Voyage expenses of $2.8 million, including the one-time charge of $1.5 million, excluding which our voyage expenses were $1.3 million versus $0.8 million, a 63% increase;
• Net Revenue of $4.9 million versus $6.9 million, a 29% decrease;
• Adjusted EBITDA of $1.7 million versus $4.2 million, a 60% decrease; adjusted EBITDA is a measure not in accordance with generally accepted accounting principles (“GAAP”). See a later section of this press release for a reconciliation of non-GAAP financial measures;
• Total comprehensive loss of $2.4 million versus a total comprehensive income of $1.2 million;
• Basic loss per share of $0.27, calculated on 10,141,998 weighted average number of shares compared to basic earnings per share of $0.16, calculated on 7,319,908 weighted average number of shares;
• An average of 7.0 vessels were owned and operated during Q2-12 compared to 5.1 vessels owned and operated during Q2-11. Average Time Charter Equivalent (“TCE”) dropped to $7,353 per day from $15,233 per day. A calculation of the TCE is provided in a later section of this press release;
• Fleet utilization was 97.1% versus 99.4%; fleet utilization is further defined in a later section of this press release.
Summary of First Half 2012 Results versus First Half 2011
• Revenue of $17.1 million versus $16.2 million, a 6% increase;
• Voyage expenses of $2.9 million versus $1.8 million, a 61% increase, including the one-time charge of $1.5 million;
• Net Revenue of $14.2 million versus $14.4 million, a 1% decrease;
• Adjusted EBITDA of $7.7 million versus $9.1 million, a 15% decrease;
• Total comprehensive loss of $0.8 versus total comprehensive income of $3.4 million;
• Average daily TCE of $11,236 per vessel with an average 7.0 vessels operating, versus an average daily TCE of $16,570 with an average of 5.1 vessels.
Dividend Declaration
Based on the reported loss for the second quarter 2012, the Company’s Board of Directors did not declare a dividend for the common shares for the period. The Company has 10,144,995 common shares issued and outstanding as of today.
The Company is continuing the policy of paying out a variable quarterly dividend in excess of 50% of the net income of the previous quarter, subject to any reserves the board of directors may from time to time determine are required. The declaration and payment of dividends, if any, will always be subject to the discretion of the board of directors of the Company. The amount of dividends paid in any period is not indicative of the amount that may be paid in the future. The timing and amount of any dividends declared will depend on, among other things: our earnings, financial condition and anticipated cash requirements and availability, additional acquisitions of vessels, restrictions in our debt arrangements, the provisions of Marshall Islands law affecting the payment of distributions to shareholders, required capital and drydocking expenditures, reserves established by our board of directors, increased or unanticipated expenses, a change in our dividend policy, additional borrowings or future issuances of securities, or as a result of losses in connection with the non-performance of charterers and other factors, many of which will be beyond our control. We can give no assurance that dividends will be paid in the future.
Management Commentary
George Karageorgiou, President and Chief Executive Officer of Globus Maritime Limited, stated:
“The second quarter of 2012 was one of the most challenging for our company. Our results were negatively affected not only by the weak freight rate environment, but also from the drydockings of two vessels and the non-performance of Allied Maritime Inc. (“Allied”), the former charterer of the “Star Globe”, against whom, we are continuing the legal proceedings to recover this amount. Unfortunately such proceedings are often protracted. “Given the low freight rate environment prevailing during the first half of 2012, we maintained an opportunistic approach employing three of our vessels in the spot market or under short term time charters. This preserves our ability to benefit from a market turnaround.
"We expect the dry bulk shipping market to remain challenging. Spot and time charter rates continue to hover at historic lows due to the extraordinarily-high fleet growth of the last couple of years. Consequently, asset values have dropped steeply in the last year creating attractive fleet expansion opportunities.
“Looking ahead, we maintain contracted coverage of 68% of our fleet for the remainder of 2012, and 45% in 2013. We expect to continue our approach of short time charters for the remainder of the fleet, until a meaningful recovery in charter rates materializes.”
Elias Deftereos, Chief Financial Officer, added:
“Globus’ second quarter results reflect the ongoing instability and weakness in the dry bulk market, with the Baltic Dry Index declining approximately 59% this year alone. “Furthermore, we see a decline of liquidity from the traditional lenders to our industry, as certain banks have announced reductions in their shipping loan portfolios. As a result banks are more selective when financing their clients. While some of our peers are facing challenges in the credit markets, Globus’s balance sheet remains strong, our relationships with banks are healthy and our shareholder base remains financially solid. “In the face of these challenging conditions, we are continuing our strategy of cost containment which continues to produce tangible results, at a time when they are most needed. Daily operating expenses for our fleet decreased by 13% from the same quarter of last year. Operational efficiency is one of the most important assets for a company, especially during times of low freight rates.”
Management Discussion and Analysis of the Results of Operations
The financial results for Q2-12 and H1-12 reflect the decision of the Board of Directors of Globus to write-off an amount of $1.7 million from the Company’s receivables, the biggest portion of which relates to voyage expenses paid by the Company due to the non-performance by Allied during the charter of the vessel “Star Globe”. Globus continues the legal proceedings to recover this amount as debt and/or damages by Allied.
Full report at: www.globusmaritime.gr
About Globus Maritime Limited
Globus is an integrated dry bulk shipping company that provides marine transportation services worldwide and presently owns, operates and manages a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina and other dry bulk cargoes internationally. Globus’ subsidiaries own and operate seven vessels with a total carrying capacity of 452,886 DWT and a weighted average age of 5.6 years as of June 30, 2012.
Globus Maritime Limited press release