Scorpio Bulkers Inc. Announces Financial Results for the Second Quarter of 2018 and Declares a Quarterly Dividend

Monaco - July 23, 2018

Scorpio Bulkers Inc. (NYSE:SALT) (“Scorpio Bulkers”, or the “Company”), today reported its results for the three and six months ended June 30, 2018.

The Company also announced today that its Board of Directors has declared a quarterly cash dividend of $0.02 per share on the Company’s common stock.

Results for the Three and Six Months Ended June 30, 2018 and 2017
For the second quarter of 2018, the Company’s GAAP net income was $0.8 million, or $0.01 per diluted share. For the same period in 2017, the Company’s GAAP net loss was $13.4 million, or $0.19 loss per diluted share. Total vessel revenues for the second quarter of 2018 were $60.6 million, compared to $37.7 million for the same period in 2017. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the second quarter of 2018 and 2017 were $28.1 million and $10.8 million, respectively (see Non-GAAP Financial Measures below).

For the six months ended June 30, 2018, the Company’s GAAP net loss was $5.0 million or $0.07 loss per diluted share. For the same period in 2017, the Company’s GAAP net loss was $48.0 million, or $0.67 loss per diluted share. Total vessel revenues for the first half of 2018 were $114.9 million, compared to $72.5 million for the same period in 2017. EBITDA for the six months ended June 30, 2018 and 2017 were $48.4 million and a loss of less than $0.1 million, respectively (see Non-GAAP Financial Measures below).

While the first half of 2018 included no non-GAAP adjustments to net income, the Company’s first half of 2017 net income included a loss/write-off of vessels and assets held for sale of $17.7 million and the write-off of deferred financing costs on the credit facility related to those specific vessels of $0.5 million. Excluding these items, the Company’s first half of 2017 adjusted net loss was $29.8 million, or $0.41 adjusted loss per diluted share. Adjusted EBITDA for the first half of 2017 was $17.7 million (see Non-GAAP Financial Measures below).

TCE Revenue

TCE Revenue Earned during the Second Quarter of 2018

• Our Kamsarmax fleet earned $12,823 per day
• Our Ultramax fleet earned $11,569 per day

Voyages Fixed thus far for the Third Quarter of 2018

• Kamsarmax fleet: approximately $13,974 per day for 47% of the days
• Ultramax fleet: approximately $10,963 per day for 46% of the days

Cash and Cash Equivalents
As of July 20, 2018, the Company had approximately $80.5 million in cash and cash equivalents.

Recent Significant Events

Dividend
In the second quarter of 2018, the Company’s Board of Directors declared and the Company paid a quarterly cash dividend of $0.02 per share totaling approximately $1.5 million.

On July 23, 2018, the Company’s Board of Directors declared a quarterly cash dividend of $0.02 per share, payable on or about August 31, 2018, to all shareholders of record as of August 15, 2018. As of July 23, 2018, 75,960,341 shares were outstanding.

Newbuilding Vessel Delivery
On June 28, 2018, the Company took delivery of the SBI Lynx, a Kamsarmax vessel, from Jiangsu Yangzijiang Shipbuilding Co. Ltd.

Debt

$30.0 Million Credit Facility
In June 2018, the Company received a commitment for a loan facility of up to $30.0 million from ING Bank N.V. to refinance two of the Company’s Kamsarmax bulk carriers (SBI Zumba and SBI Parapara). The loan facility has a final maturity date of five years from drawdown date and bears interest at LIBOR plus a margin of 2.20% per annum. This loan facility increases the Company’s liquidity by approximately $8.0 million after repayment of the vessels’ existing debt. The terms and conditions are similar to those set forth in the Company's existing credit facilities and the loan facility is subject to customary conditions precedent and the execution of definitive documentation.

$19.0 Million Lease Financing - SBI Echo
On July 18, 2018, the Company closed a previously announced financing transaction with an unaffiliated third party involving the sale and leaseback of the SBI Echo, a 2015 Japanese built Ultramax vessel, for consideration of $19.0 million. As part of the transaction, the Company will make payments of $5,400 per day under a five-year bareboat charter agreement with the buyer. If converted to floating interest rates, based on the expected weighted average life of the transaction, the equivalent cost of financing at the then prevailing swap rates would have been LIBOR + 1.97% per annum.

The transaction also provides the Company with options to repurchase the vessel beginning on the third anniversary of the sale until the end of the bareboat charter agreement. This transaction, which is being treated as a financial lease for accounting purposes beginning in the third quarter of 2018, increased the Company’s liquidity by approximately $7.9 million after repayment of the vessel’s existing loan.

$19.0 Million Lease Financing - SBI Tango
On July 18, 2018, the Company closed a previously announced financing transaction with an unaffiliated third party involving the sale and leaseback of the SBI Tango, a 2015 Japanese built Ultramax vessel, for consideration of $19.0 million. As part of the transaction, the Company will make payments of $5,400 per day under a five-year bareboat charter agreement with the buyer. If converted to floating interest rates, based on the expected weighted average life of the transaction, the equivalent cost of financing at the then prevailing swap rates would have been LIBOR + 1.73% per annum.

The transaction also provides the Company with options to repurchase the vessel beginning on the third anniversary of the sale until the end of the bareboat charter agreement. This transaction, which is being treated as a financial lease for accounting purposes beginning in the third quarter of 2018, increased the Company’s liquidity by approximately $10.3 million after repayment of the vessel’s existing loan.

Full report

Scorpio Bulkers Inc. press release