Hellenic Carriers reports final results for the year ended 31 December 2011
2011 Financial Results - Press Release 14 March 2012
Hellenic Carriers Limited, (“Hellenic” or the “Company”) (AIM: HCL), an international provider of marine
transportation services, which owns and operates through its wholly owned subsidiaries a fleet of five dry
bulk vessels that transport iron ore, grain, steel products and minor bulk cargoes, is pleased to report today
its Final Results for the year ended 31 December 2011.
The Company’s management team will be holding a conference call and webcast today, at 2pm (London),
4pm (Athens) and 10am (New York) to discuss the results.
2011 FINANCIAL
• Revenue US$33.2 million (2010: US$57.5 million)
• EBITDA1 US$16.9 million (2010: US$38.4 million)
• Operating Profit US$3.6 million before non-cash items (2010: US$24.5 million)
• Net Loss US$1.1 million excluding non-cash items (2010: US$19.1 million Net Income)
• Non-cash impairment charge US$29.3 (2010: US$ nil)
• Gearing ratio2 at 30.2% as of 31 December 2011 (26.5% as of 31 December 2010)
• Total cash, including restricted cash of US$48.0 million as of 31 December 2011 (US$60.0 million,
as of 31 December 2010)
• Reduction of Gross debt to US$88.2 million on 31 December 2011 (US$105.3 million on 31
December 2010) resulting in a net debt position of US$40.1 million as of 31 December 2011
(US$45.3 million as of 31 December 2010)
2011 OPERATIONAL
• Operation of a fleet of 5.0 vessels on average compared to 5.6 vessels in 2010
• Net cash generated from operations US$16.7 million (2010: US$36.1 million)
• Time Charter Equivalent rate of US$17,369 (2010: US$26,089) outperforming the average 2011
Panamax and Supramax TC earnings (US$13,895 and US$13,792 respectively3)
Management Commentary
The decrease in our Company’s revenues is mainly attributed to the lower freight rates prevailing during the year. It is also a result of the reduction in fleet operating days after the sale of the M/V Hellenic Breeze in August 2010.
During the first quarter of the year, our Company benefited from the continuation of charters agreed prior to the market downturn in Q4 2008 at very high rates. Following the expiration of these agreements, the vessels were traded in the spot market avoiding long term commitments at low rates. Our strategy moving forward is to secure period employment for the vessels when the freight market improves.
Our operating fleet will expand in 2013 when the two new building Kamsarmax vessels on order since 2010 will be delivered. By that time, we expect dry bulk fundamentals to improve, as the glut of new tonnage that is currently being delivered will have subsided and will allow the underlying supply/demand balance to tighten, thereby helping the freight market.
However, in light of current market conditions, our company has already taken steps to reinforce further its liquidity position. As a result of an agreement reached with the lenders, the debt repayment obligations have been reduced for the next 2 years and the tenor of one of the loan facilities extended for 3 years. All necessary waivers in respect of the financial covenants until 2014 have also been obtained. Furthermore, our Board of Directors recommended that dividend payments for the year 2011 be suspended in order to optimize the use of cash when market opportunities arise.
Time charter rates have continued to be at depressed levels in 2012 and we expect 2012 to be a challenging year for the dry bulk sector, mainly due to fleet supply issues. However, looking ahead, we are optimistic about the longer term dry bulk fundamentals as economic growth in the developing countries remains robust. This trend is expected to continue thereby increasing the need for transportation of iron ore, coal and grain. Equally important is the urbanization growth in the Far East, which is on-going and will result in an increase in infrastructure projects and higher demand for energy resources. Another factor which should be taken into account is that approximately 17% or 100mdwt of the existing global dry-bulk fleet is over-aged and will eventually be scrapped, thereby alleviating the oversupply within the next two years. We expect that during the same period the pace of new building orders will remain at low levels due to limited financing resources.
The combination of the above mentioned factors, sustainable demand from the emerging economies, increased scrapping and limited new building activity, contribute to our positive long term outlook of the dry bulk market.
Full report at: www.hellenic-carriers.com
1. EBITDA has been calculated as follows: Operating profit + Depreciation + Depreciation of dry-docking costs + Impairment charge - Gain on sale of vessel - Other operating income
2. Gearing ratio is defined as Net Debt to total capitalization (debt, net of deferred financing fees less cash and cash equivalents to net debt and stockholders’ equity)
3. Clarksons’ Research Services
About Hellenic Carriers Limited
Hellenic Carriers Limited manages through Hellenic Shipmanagement Corp. a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina, and other dry bulk cargoes worldwide. The fleet consists of five vessels, comprising three Panamaxes, one Supramax and one Handymax with an aggregate carrying capacity of 303,141 dwt and a weighted average date of 16.4 years plus two new building vessels currently on order, both Kamsarmaxes with an aggregate carrying capacity of about 164,000 dwt.
Following the delivery of the two Kamsarmax vessels, the Company will manage through Hellenic Shipmanagement Corp. a fleet of seven dry bulk carriers comprising two Kamsarmaxes, three Panamaxes, one Supramax and one Handymax with an aggregate carrying capacity of about 467,141 dwt and a weighted average age of 12.5 years (as of 31 March 2013).
Hellenic Carriers is listed on the AIM of the London Stock Exchange under ticker HCL.
Hellenic Carriers Limited press release