-- Net loss of $0.9 million or $0.03 loss per share basic and diluted on total net revenues of $12.8 million. Excluding the effect of unrealized gain and realized loss on derivatives and unrealized loss on trading securities and amortization of the fair value of charters acquired, the net loss for the period would have been $3.9 million, or $0.12 loss per share basic and diluted. -- Adjusted EBITDA was $1.0 million. Please refer to a subsequent section of the Press Release for a reconciliation of adjusted EBITDA to net income. -- An average of 16.00 vessels were owned and operated during the fourth quarter of 2010 earning an average time charter equivalent rate of $10,091 per day. M/V Eleni P was released in December 2010 after seven months of captivity after being hijacked in May of 2010. -- Declared a quarterly dividend of $0.06 per share for the fourth quarter of 2010 payable on March 11, 2011 to shareholders of record on March 1, 2011. This is the 22nd consecutive quarterly dividend declared.Full Year 2010 Highlights:
-- Net loss of $6.6 million or $0.21 loss per share basic and diluted on total net revenues of $52.5 million. Excluding the effect of unrealized gain and realized loss on derivatives and unrealized loss on trading securities and amortization of the fair value of charters acquired, the net loss for the period would have been $4.3 million, or $0.14 loss per share basic and diluted. -- Adjusted EBITDA was $14.4 million. Please refer to a subsequent section of the Press Release for a reconciliation of adjusted EBITDA to net income. -- An average of 15.5 vessels were owned and operated during 2010 earning an average time charter equivalent rate of $11,201 per day. -- Declared four quarterly dividends for a total of $0.23 per share during 2010. -- Completed a joint venture with private equity firms under which we purchased 6 vessels in 2010 investing almost half of the committed capital of $175 million. Euroseas has committed $25 million to the venture.Aristides Pittas, Chairman and CEO of Euroseas commented: "2010 was a significant year for Euroseas in many respects. It was a difficult year as our containership fleet had to go through a period of low earnings as a result of charters we had to enter into during the bottom of the market in 2009 and the first half of 2010. Two of our containerships that had been laid up in 2009 were only reactivated during the second half of the year when the container market started to recover. On the other hand, it was a pivotal year as we took advantage of the low containership prices and acquired one vessel directly, and 6 more vessels via Euromar, our joint venture with two private firms which we concluded in the first quarter of 2010. On our own and via Euromar, we have more than $100m of cash which we plan to invest as attractive opportunities and accretive projects are identified. Looking into 2011 and beyond, we expect significant contribution to our earnings from our containership fleet and investment in Euromar as our containership charters are being rolled over from the existing lower levels to rates reflecting the currently rising market rates. At the same time, our drybulk fleet is fully covered for 2011 and a good part of 2012, insulating us from the widely anticipated weakness in that sector. Thus, I would like to suggest that investors look at us as a company with a base revenue secured from our drybulk fleet and with significant exposure to the recovering containership sector, especially, the geared segment below 3000teu. We believe that in addition to the overall containership market recovery, the below 3000teu segment will benefit from the rapidly developing trades involving the entire developing world. Reaffirming our positive prospects, our Board decided to maintain our quarterly dividend of $0.06 per share which represents an annual yield of about 6.25% on the basis of our stock price on February 15, 2011." Tasos Aslidis, Chief Financial Officer of Euroseas commented: "The results of the fourth quarter of 2010 reflect primarily the high number of our vessels that were drydocked during the quarter. In several cases, we chose to accelerate the drydocking, especially of containerships, in order to increase our flexibility of chartering our fleet in a market that it is anticipated to continue improving after the year-end seasonal slowdown. As in previous periods of 2010, our financial results for the quarter were negatively influenced by realized losses in FFAs and interest rate swap contracts and positively affected by net unrealized gains on our overall derivative positions. We have now settled all our FFA contracts that were initiated in the first half of 2009 to provide us protection against the possibility of a drybulk market collapse. For 2011, we only have a pair of contracts for a panamax vessel equivalent that protects us if rates fall below $16,500/day and caps our upside at $23,500/day; with spot rates for the index vessel around $13,500/day, this contract is currently providing us with the desired coverage. Total daily vessel operating expenses, including management fees, general and administrative expenses but excluding drydocking costs, reflect an increase of about 5.5% during the fourth quarter of 2010 compared to the same quarter of last year which is primarily due to the fact that all of our vessels are now operating as compared to having 3 vessels laid-up during the fourth quarter of 2009; and, a decrease of about 4.6% for the full year ended December 31, 2010 over 2009. As always, we want to emphasize that cost control remains a key component of our strategy and we believe that our 2010 total daily average cost per vessel of $5,191 clearly reflects our success in this respect. During the fourth quarter of 2010, we drew loans totaling $28.5 million against two of our unencumbered vessels in order to enhance our liquidity and continue our fleet renewal and expansion program. As of December 31, 2010, our outstanding debt was $88.39 million versus restricted and unrestricted cash of about $40.1 million. Even after the new loans, we estimate that our debt-to-market value of fleet ratio is around 40%, still a quite conservative level. As of the same date, our scheduled debt repayments over the next 12 months amounted to about $13.5 million, a number low enough to provide us with significant operational cash flow comfort. All our debt covenants were satisfied as of December 31, 2010." Fourth Quarter 2010 Results: For the fourth quarter of 2010, the Company reported total net revenues of $12.8 million representing a 22.3% decrease over total net revenues of $16.5 million during the fourth quarter of 2009. The Company reported net loss for the period of $0.9 million as compared to a net loss of $16.3 million for the fourth quarter of 2009. The results for the fourth quarter of 2010 include a $4.0 million net unrealized gain on derivatives and trading securities and a $1.6 million net realized loss on derivatives as compared to $5.1 million net unrealized loss on derivatives and trading securities and $4.8 million realized loss on derivatives for the same period of 2009. Depreciation expenses for the fourth quarter of 2010 were $4.6 million compared to $4.7 million during the same period of 2009. On average, 16.00 vessels were owned and operated during the fourth quarter of 2010 earning an average time charter equivalent rate of $10,091 per day compared to 16.68 vessels in the same period of 2009 earning on average $13,892 per day. Adjusted EBITDA for the fourth quarter of 2010 was $1.0 million, a 79.5% decrease from $4.9 million achieved during the fourth quarter of 2009. Please see below for Adjusted EBITDA reconciliation to net income / loss and cash flow provided by operating activities. Basic and diluted losses per share for the fourth quarter of 2010 were $0.03, calculated on 30,968,108 basic and diluted weighted average number of shares outstanding, compared to basic and diluted losses per share of $0.53 for the fourth quarter of 2009, calculated on 30,813,960 weighted average number of shares outstanding, basic and diluted. Excluding the effect on the losses for the quarter of the unrealized gain on derivatives and the realized loss on derivatives, unrealized loss on trading securities and amortization of the fair value of time charter contracts acquired, the loss per share for the quarter ended December 31, 2010 would have been $0.12 per share, basic and diluted, compared to earnings per share of $0.00 for the quarter ended December 31, 2009. Usually, security analysts do not include the above items in their published estimates of earnings per share. Full Year 2010 Results: For the full year of 2010, the Company reported total net revenues of $52.5 million representing a 17.7% decrease over total net revenues of $63.8 million during the full year of 2009. The Company reported a net loss for the period of $6.6 million as compared to net loss of $15.6 million for the full year of 2009. The results for 2010 include a $8.1 million net unrealized gain on derivatives and trading securities and a $12.4 million net realized loss on derivatives as compared to $7.6 million net unrealized loss on derivatives and trading securities and $8.2 million net realized loss on derivatives for the same period of 2009. Depreciation expenses for year 2010 were $18.0 million compared to $19.1 million during the same period of 2009. On average, 15.5 vessels were owned and operated during 2010 earning an average time charter equivalent rate of $11,201 per day compared to 16.3 vessels in the same period of 2009 earning on average $13,698 per day. Two of the Company's vessels that were laid up during the entire first half of 2010 were reactivated during the fourth quarter of the year. Adjusted EBITDA for year 2010 was $14.4 million, a 41.9% decrease from $24.9 million achieved during 2009. Please see below for Adjusted EBITDA reconciliation to net income/loss and cash flow provided by operating activities. Basic and diluted loss per share for year 2010 was $0.21, calculated on 30,900,122 weighted average number of shares outstanding, compared to basic and diluted loss per share of $0.51 basic and diluted per share for the year 2009, calculated on 30,648,991 basic and diluted weighted average number of shares outstanding. Excluding the effect on the earnings of the unrealized gain on derivatives, realized loss on derivatives, unrealized loss on trading securities and amortization of the fair value of time charter contracts acquired, the net loss per share for the year ended December 31, 2010 would have been $0.14 per share compared to earnings of $0.18 per share, basic and diluted, for the same period in 2009. Usually, security analysts do not include the above items in their published estimates of earnings per share. Fleet Profile: The Euroseas Ltd. fleet profile is as follows:
Year TCE Rate
Name Type Dwt TEU Built Employment ($/day)
---------------- ------------- ------- ------ ----- ------------- ---------
Dry Bulk Vessels
---------------- ------------- ------- ------ ----- ------------- ---------
PANTELIS TC 'til
Panamax 74,020 2000 Mar-12 $17,500
---------------- ------------- ------- ------ ----- ------------- ---------
ELENI P TC 'til
Panamax 72,119 1997 Jan-13 $16,500
---------------- ------------- ------- ------ ----- ------------- ---------
IRINI (*) TC 'til
Panamax 69,734 1988 Apr-13 $14,000
---------------- ------------- ------- ------ ----- ------------- ---------
ARISTIDES N.P. TC 'til
Panamax 69,268 1993 May-12 $14,950
---------------- ------------- ------- ------ ----- ------------- ---------
MONICA P (*) Bulkhandling
(**) Handymax 46,667 1998 Pool
---------------- ------------- ------- ------ ----- ------------- ---------
Total Dry Bulk
Vessels 5 331,808
---------------- ------------- ------- ------ ----- ------------- ---------
Multipurpose Dry
Cargo Vessels
---------------- ------------- ------- ------ ----- ------------- ---------
TASMAN TRADER TC 'til
1 22,568 950 1990 Mar-12 $9,000
---------------- ------------- ------- ------ ----- ------------- ---------
Container
Carriers
---------------- ------------- ------- ------ ----- ------------- ---------
MAERSK NOUMEA $16,800
'til
Aug-11
$18,735
'til
Aug-12
$19,240
TC 'til 'til
Jun-11 Aug-13
(3 annual $19,750
options 'til 'til
Intermediate 34,677 2,556 2001 Jul-14) Jul-14
---------------- ------------- ------- ------ ----- ------------- ---------
TIGER BRIDGE
TC 'til
Mar-11
(option 'til $4,000
Intermediate 31,627 2,228 1990 Mar-12) $7,500
---------------- ------------- ------- ------ ----- ------------- ---------
AGGELIKI P
TC 'til
Intermediate 30,360 2,008 1998 May-11 $7,000
---------------- ------------- ------- ------ ----- ------------- ---------
DESPINA P TC 'til
Handy size 33,667 1,932 1990 Jan-12 $8,500
---------------- ------------- ------- ------ ----- ------------- ---------
JONATHAN P
(ex-OEL TC 'til
INTEGRITY) Handy size 33,667 1,932 1990 Apr-11 $9,000
---------------- ------------- ------- ------ ----- ------------- ---------
CAPTAIN COSTAS $4,250
(ex-OEL 'til
TRANSWORLD) Mar-11
TC 'til then
Handy size 30,007 1,742 1992 Aug-11 $10,250
---------------- ------------- ------- ------ ----- ------------- ---------
YM PORT KELANG
(ex-MASTRO
NICOS, ex- YM TC 'til
XINGANG I) Handy size 23,596 1,599 1993 Oct-11 $5,900
---------------- ------------- ------- ------ ----- ------------- ---------
MANOLIS P TC 'til
Handy size 20,346 1,452 1995 May-11 $7,699
---------------- ------------- ------- ------ ----- ------------- ---------
NINOS
(ex-YM QINGDAO TC 'til
I) Feeder 18,253 1,169 1990 May-11 $6,800
---------------- ------------- ------- ------ ----- ------------- ---------
KUO HSIUNG TC 'til
Feeder 18,154 1,169 1993 Jun-11 $5,300
---------------- ------------- ------- ------ ----- ------------- ---------
Total Container
Carriers 10 274,354 17,787
---------------- ------------- ------- ------ ----- ------------- ---------
Fleet Grand
Total 16 628,730 18,737
---------------- ------------- ------- ------ ----- ------------- ---------
(*) "Monica P" is employed in the Bulkhandling spot pool that is also
managed by Klaveness.
(**) The company has concluded a Forward Freight Agreement(FFA) option
contract on the panamax index for calendar 2011 for a modern panamax.
Such a contract serves as an approximate hedge to one of our panamax
vessels for 2011 effectively locking in a rate between $16,500 and
$23,500.
(***) Charter duration are meant to be the earliest redelivery dates.
Generally, charterers have a range of 15 days to 3 of months to
redeliver the vessels depending on the length of the charter.
Summary Fleet Data:
3 months, 3 months,
ended ended Year ended Year ended
December December December December
31, 2009 31, 2010 31, 2009 31, 2010
----------- ----------- ----------- -----------
FLEET DATA
Average number of vessels 16.68 16.00 16.30 15.53
(1)
Calendar days for fleet (2) 1,535.0 1,472.0 5,949.0 5,669.0
Scheduled off-hire days
incl. laid-up (3) 262.0 120.7 966.5 715.9
Available days for fleet (4)
= (2) - (3) 1,273.0 1,351.3 4,982.5 4,953.1
Commercial off-hire days (5) 67.6 3.8 223.7 3.8
Operational off-hire days
(6) (*) 11.8 13.4 35.0 35.6
Voyage days for fleet (7) =
(4) - (5) - (6) 1,193.6 1,334.1 4,723.8 4,913.7
Fleet utilization (8) = (7)
/ (4) 93.8% 98.7% 94.8% 99.2%
Fleet utilization,
commercial (9) = ((4) -
(5)) / (4) 94.7% 99.7% 95.5% 99.9%
Fleet utilization,
operational (10) = ((4) -
(6)) / (4) 99.1% 99.0% 99.3% 99.3%
AVERAGE DAILY RESULTS
Time charter equivalent rate
(11) 13,892 10,091 13,698 11,201
Vessel operating expenses
excl. drydocking expenses
(12) 4,955 5,329 4,832 4,657
General and administrative
expenses (13) 516 445 612 534
Total vessel operating
expenses (14) 5,471 5,774 5,444 5,191
----------- ----------- ----------- -----------
Drydocking expenses (15) - 2,023 321 1,153
----------- ----------- ----------- -----------
(1) Average number of vessels is the number of vessels that constituted our
fleet for the relevant period, as measured by the sum of the number of
calendar days each vessel was a part of our fleet during the period divided
by the number of calendar days in that period.
(2) Calendar days. We define calendar days as the total number of days in a
period during which each vessel in our fleet was in our possession
including off-hire days associated with major repairs, drydockings or
special or intermediate surveys or days of vessels in lay-up. Calendar days
are an indicator of the size of our fleet over a period and affect both the
amount of revenues and the amount of expenses that we record during that
period.
(3) The scheduled off-hire days including vessels laid-up are days
associated with scheduled repairs, drydockings or special or intermediate
surveys or days of vessels in lay-up. The shipping industry uses available
days to measure the number of days in a period during which vessels were
available to generate revenues.
(4) Available days. We define available days as the total number of days in
a period during which each vessel in our fleet was in our possession net of
scheduled off-hire days including days of vessels laid-up.
(5) Commercial off-hire days. We define commercial off-hire days as days
waiting to find employment.
(6) Operational off-hire days. We define operational off-hire days as days
associated with unscheduled repairs or other off-hire time related to the
operation of the vessels.
(7) Voyage days. We define voyage days as the total number of days in a
period during which each vessel in our fleet was in our possession net of
commercial and operational off-hire days. The shipping industry uses voyage
days to measure the number of days in a period during which vessels
actually generate revenues. In 2010, we treated as operational the days of
one of our vessels while she was hijacked as during that period the vessel
original charter was insured and, in addition, the vessel did receive hire
from insurance for the entire period of hijacking.
(8) Fleet utilization. We calculate fleet utilization by dividing the
number of our voyage days during a period by the number of our available
days during that period. The shipping industry uses fleet utilization to
measure a company's efficiency in finding suitable employment for its
vessels and minimizing the amount of days that its vessels are off-hire for
reasons such as unscheduled repairs or days waiting to find employment.
(9) Fleet utilization, commercial. We calculate commercial fleet
utilization by dividing our available days net of commercial off-hire days
during a period by our available days during that period.
(10) Fleet utilization, operational. We calculate operational fleet
utilization by dividing our available net of operational off-hire days
during a period by our available days during that period.
(11) Time charter equivalent, or TCE, is a measure of the average daily
revenue performance of a vessel on a per voyage basis. Our method of
calculating TCE is consistent with industry standards and is determined by
dividing revenue generated from voyage charters (including for that matter
any insurance proceeds from loss of hire insurance) net of voyage expenses
by voyage days for the relevant time period. Voyage expenses primarily
consist of port, canal and fuel costs that are unique to a particular
voyage, which would otherwise be paid by the charterer under a time charter
contract, as well as commissions. TCE is a standard shipping industry
performance measure used primarily to compare period-to-period changes in a
shipping company's performance despite changes in the mix of charter types
(i.e., spot voyage charters, time charters and bareboat charters) under
which the vessels may be employed between the periods.
(12) Daily vessel operating expenses, which includes crew costs,
provisions, deck and engine stores, lubricating oil, insurance, maintenance
and repairs and management fees are calculated by dividing vessel operating
expenses by fleet calendar days for the relevant time period. Drydocking
expenses are reported separately.
(13) Daily general and administrative expense is calculated by dividing
general and administrative expense by fleet calendar days for the relevant
time period.
(14) Total vessel operating expenses, or TVOE, is a measure of our total
expenses associated with operating our vessels. TVOE is the sum of vessel
operating expenses excluding drydocking expenses and general and
administrative expenses. Daily TVOE is calculated by dividing TVOE by fleet
calendar days for the relevant time period.
(15) Drydocking expenses, which include expenses during drydockings that
would been capitalized and amortized under the deferral method divided by
the fleet calendar days for the relevant period. Drydocking expenses could
vary substantially from period to period depending on how many vessels
underwent drydocking during the period.
Conference Call and Webcast:
Later today, Tuesday, February 22, 2011 at 8:00 a.m. EST, the company's
management will host a conference call to discuss the results.
Conference Call details:
Participants should dial into the call 10 minutes before the scheduled time
using the following numbers: 1 866 819 7111 (from the US), 0800 953 0329
(from the UK) or +44 (0)1452 542 301 (international standard dial in).
Please quote "Euroseas."
A recording of the conference call will be available until March 1, 2011 by
dialing 1 866 247 4222 (from the US), 0800 953 1533 (from the UK) or +44
(0)1452 550 000 (international standard dial in). Access Code: 6973591#
Audio webcast -- Slides Presentation:
There will be a live and then archived audio webcast of the conference
call, via the internet through the Euroseas website (www.euroseas.gr).
Participants to the live webcast should register on the website
approximately 10 minutes prior to the start of the webcast. A slide
presentation on the fourth quarter and full year 2010 results in PDF format
will also be available 30 minutes prior to the conference call and webcast
accessible on the company's website (www.euroseas.gr) on the webcast page.
Participants to the webcast can download the PDF presentation.
Euroseas Ltd.
Consolidated Condensed Statements of Operations
(All amounts expressed in U.S. Dollars - except share amounts)
Three Months Three Months
Ended Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
2009 2010 2009 2010
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Voyage revenue 17,117,138 13,286,447 66,215,669 54,422,489
Commissions (658,815) (500,267) (2,433,776) (1,944,473)
Net revenues 16,458,323 12,786,180 63,781,893 52,478,016
Operating expenses
Voyage expenses 535,513 647,407 1,510,551 1,596,569
Vessel operating
expenses 6,237,576 6,493,645 23,673,480 21,507,192
Drydocking expenses - 2,977,585 1,912,474 6,537,733
Depreciation 4,701,556 4,586,937 19,092,384 17,979,750
Impairment loss /
net loss on sale
of vessels 8,959,321 - 8,959,321 -
Management fees 1,366,947 1,350,928 5,074,297 4,892,006
Other general and
administrative
expenses 792,067 655,407 3,640,534 3,026,941
Charter termination
fees and other
income - (871,638) (103,577) (2,352,946)
Total operating
expenses 22,592,980 15,840,271 63,759,464 53,187,245
Operating income /
(loss) (6,134,657) (3,054,091) 22,429 (709,229)
Other
income/(expenses)
Interest and
finance cost (409,420) (406,354) (1,437,637) (1,498,216)
Gain / (Loss) on
derivatives, net (9,827,627) 2,464,441 (15,778,209) (4,221,817)
Realized &
unrealized gain/
(loss) on trading
securities (115,751) (68,573) 406,119 (173,375)
Foreign exchange
(loss)/ gain 12,575 (975) 36,477 (3,200)
Interest income 170,805 53,532 1,123,317 538,820
Other income /
(expenses), net (10,169,418) 2,042,071 (15,649,933) (5,357,788)
Equity Earnings
(loss) in joint
venture - 83,386 - (538,833)
------------ ------------ ------------ ------------
Net loss (16,304,075) (928,634) (15,627,504) (6,605,850)
------------ ------------ ------------ ------------
Loss per share,
basic (0.53) (0.03) (0.51) (0.21)
Weighted average
number of shares,
basic 30,813,960 30,968,108 30,648,991 30,900,122
------------ ------------ ------------ ------------
Loss per share,
diluted (0.53) (0.03) (0.51) (0.21)
------------ ------------ ------------ ------------
Weighted average
number of shares,
diluted 30,813,960 30,968,108 30,648,991 30,900,122
------------ ------------ ------------ ------------
Euroseas Ltd.
Consolidated Condensed Balance Sheets
(All amounts expressed in U.S. Dollars - except share amounts)
December 31, December 31,
2009 2010
(unaudited) (unaudited)
ASSETS
Current Assets:
Cash and cash equivalents 40,984,549 34,273,518
Trade accounts receivable 1,650,713 1,563,761
Other receivables, net 239,656 6,693,985
Inventories 1,869,238 1,788,256
Restricted cash 1,191,230 976,714
Other deposits 12,376,119 -
Derivatives - 574,336
Trading securities 436,598 263,223
Prepaid expenses 185,137 271,033
Total current assets 58,933,240 46,404,826
Fixed assets:
Vessels, net 257,270,824 255,412,434
Long-term assets:
Restricted cash 6,500,000 4,800,000
Deferred charges, net 327,694 599,374
Derivatives 386,536 -
Investment in joint venture - 14,461,167
Total long-term assets 264,485,054 275,272,975
------------- -------------
Total assets 323,418,294 321,677,801
------------- -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Long term debt, current portion 14,030,000 13,472,000
Trade accounts payable 1,843,182 3,950,934
Accrued expenses 1,060,326 2,212,401
Accrued dividends 46,750 32,175
Deferred revenue 1,247,782 2,114,335
Derivatives 10,799,132 1,837,924
Due to related company 1,416,380 1,594,773
Total current liabilities 30,443,552 25,214,542
Long-term liabilities:
Long term debt, net of current portion 57,485,000 74,913,000
Derivatives 611,852 1,537,056
Fair value of below market time charter
acquired 3,424,627 1,318,211
Total long-term liabilities 61,521,479 77,768,267
Total liabilities 91,965,031 102,982,809
Shareholders' equity:
Common stock (par value $0.03, 200,000,000
shares authorized, 30,849,711 and
31,002,211 issued and outstanding,
respectively) 925,492 930,067
Preferred shares (par value
$0.01, 20,000,000 shares authorized, no
shares issued and outstanding) - -
Additional paid-in capital 235,588,391 236,279,931
Accumulated deficit (5,060,620) (18,515,006)
Total shareholders' equity 231,453,263 218,694,992
------------- -------------
Total liabilities and shareholders' equity 323,418,294 321,677,801
------------- -------------
Euroseas Ltd.
Consolidated Condensed Statements of Cash Flows
(All amounts expressed in U.S. Dollars)
Year Ended Year Ended
December 31, December 31,
2009 2010
(unaudited) (unaudited)
------------ ------------
Cash flows from operating activities:
Net loss (15,627,504) (6,605,850)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation of vessels 19,092,384 17,979,750
Impairment loss / loss on sale of vessels 8,959,321 -
Amortization of deferred charges 110,504 108,569
Amortization of fair value of time charters (3,626,762) (2,106,416)
Share-based compensation 820,189 696,117
Unrealized loss / (gain) on derivatives, net 7,626,918 (8,223,804)
Loss in investment in joint venture - 538,833
Sale of trading securities 741,248 -
Unrealized (gain) / loss on trading securities (406,118) 173,375
Changes in operating assets and liabilities (9,852,520) 10,188,415
------------ ------------
Net cash provided by operating activities 7,837,660 12,748,989
------------ ------------
Cash flows from investing activities:
Purchase of vessels including improvements (62,224,639) (16,121,360)
Investment in joint venture - (15,000,000)
Insurance proceeds 667,839 -
Change in restricted cash (709,966) 1,914,516
Proceeds from sale of vessels 16,668,001 -
------------ ------------
Net cash (used in) investing activities (45,598,765) (29,206,844)
------------ ------------
Cash flows from financing activities:
Issuance of share capital 4,023 -
Net proceeds from shares issued 645,242 -
Dividends paid (10,849,609) (6,863,112)
Offering expenses paid (197,193) (99,814)
Loan arrangements fees paid (208,000) (160,250)
Proceeds from long-term debt 33,000,000 28,500,000
Repayment of long-term debt (17,500,000) (11,630,000)
------------ ------------
Net cash provided by financing activities 4,894,463 9,746,824
------------ ------------
Net decrease in cash and cash equivalents (32,866,642) (6,711,031)
Cash and cash equivalents at beginning of
period 73,851,191 40,984,549
------------ ------------
Cash and cash equivalents at end of period 40,984,549 34,273,518
------------ ------------
Euroseas Ltd.
Reconciliation of Adjusted EBITDA to
Net Loss and Cash Flow Provided By Operating Activities
(All amounts expressed in U.S. Dollars)
Three Three
Months Ended Months Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
2009 2010 2009 2010
------------ ------------ ------------ ------------
Net loss (16,304,075) (928,634) (15,627,504) (6,605,850)
------------ ------------ ------------ ------------
Interest and
finance costs, net
(incl. interest
income) 238,615 352,822 314,320 959,396
------------ ------------ ------------ ------------
Depreciation 4,701,556 4,586,937 19,092,384 17,979,750
------------ ------------ ------------ ------------
Impairment / net
loss from vessel
sales 8,959,321 - 8,959,321 -
------------ ------------ ------------ ------------
Loss / (gain) on
derivatives, net 9,827,627 (2,464,441) 15,778,209 4,221,817
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of below market
time charter
acquired (2,533,811) (526,604) (5,280,184) (2,106,416)
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of above market
time charter
acquired - - 1,653,422 0
------------ ------------ ------------ ------------
Adjusted EBITDA 4,889,233 1,020,080 24,889,968 14,448,697
------------ ------------ ------------ ------------
Three Three
Months Ended Months Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
2009 2010 2009 2010
----------- ----------- ----------- -----------
Net cash flow provided
by /(used in)
operating activities (3,657,862) 1,856,609 7,837,660 12,748,989
----------- ----------- ----------- -----------
Changes in operating
assets / liabilities 3,732,063 (2,584,805) 9,852,520 (10,188,415)
----------- ----------- ----------- -----------
Loss on interest rate
and FFA derivatives
(realized) 4,840,730 1,607,694 8,151,290 12,445,622
----------- ----------- ----------- -----------
Gain / (loss) on
trading securities &
investment in joint
venture, net (115,752) 14,813 406,118 (712,208)
----------- ----------- ----------- -----------
Sale of trading
securities, net - - (741,248) -
----------- ----------- ----------- -----------
Share-based
compensation (110,475) (195,244) (820,189) (696,117)
----------- ----------- ----------- -----------
Interest, net 200,529 321,013 203,817 850,826
----------- ----------- ----------- -----------
Adjusted EBITDA 4,889,233 1,020,080 24,889,968 14,448,697
----------- ----------- ----------- -----------
EBITDA Reconciliation:
Euroseas Ltd. considers Adjusted EBITDA to represent net earnings before
interest, income taxes, depreciation, gain / loss in derivatives and
amortization of deferred revenues from above or below market time charters
acquired. Adjusted EBITDA does not represent and should not be considered
as an alternative to net income or cash flow from operations, as determined
by United States generally accepted accounting principles, or U.S. GAAP,
and our calculation of Adjusted EBITDA may not be comparable to that
reported by other companies. Adjusted EBITDA is included herein because it
is a basis upon which we assess our financial performance and liquidity
position and because we believe that it presents useful information to
investors regarding a company's ability to service and/or incur
indebtedness. The Company's definition of Adjusted EBITDA may not be the
same as that used by other companies in the shipping or other industries.
Euroseas Ltd.
Reconciliation of Net Income / (loss) Excluding the Effect
from Unrealized Loss / (Gain)
and Realized Loss on derivatives, Unrealized (Loss on trading securities
and Amortization of the Fair Value of Charters Acquired
to Net Loss)
(All amounts expressed in U.S. Dollars - except
share data and per share amounts)
Three Three
Months Ended Months Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
2009 2010 2009 2010
------------- ------------- ------------- -------------
Net loss (16,304,075) (928,634) (15,627,504) (6,605,850)
------------- ------------- ------------- -------------
Unrealized
loss / (gain)
on derivatives,
net 4,986,897 (4,072,135) 7,626,919 (8,223,805)
------------- ------------- ------------- -------------
Unrealized
loss on
trading
securities 115,751 68,573 5,325 173,375
------------- ------------- ------------- -------------
Impairment
loss / loss on
sale 8,959,321 - 8,959,321 -
------------- ------------- ------------- -------------
Realized loss
on derivatives 4,840,730 1,607,694 8,151,290 12,445,622
------------- ------------- ------------- -------------
Amortization
of deferred
revenue of
below market
time charter
acquired (2,533,811) (526,604) (5,280,184) (2,106,416)
------------- ------------- ------------- -------------
Amortization
of deferred
revenue of
above market
time charter
acquired - - 1,653,422 -
------------- ------------- ------------- -------------
Net
income/(loss)
excluding
unrealized
loss / (gain)
on
derivatives,
unrealized
(gain) / loss
on trading
securities,
realized loss
on
derivatives,
amortization
of the fair
value of
charters
acquired 64,813 (3,851,106) 5,488,589 (4,317,074)
------------- ------------- ------------- -------------
Net
income/(loss)
per share
excluding
unrealized
loss / (gain)
on
derivatives,
unrealized
(gain) / loss
on trading
securities,
realized loss
on
derivatives,
amortization
of the fair
value of
charters
acquired,
basic 0.00 (0.12) 0.18 (0.14)
------------- ------------- ------------- -------------
Weighted
average number
of shares,
basic 30,813,960 30,968,108 30,648,991 30,900,122
------------- ------------- ------------- -------------
Net
income/(loss)
per share
excluding
unrealized
loss / (gain)
on
derivatives,
unrealized
(gain) / loss
on trading
securities,
realized loss
on
derivatives,
amortization
of the fair
value of
charters
acquired,
diluted 0.00 (0.12) 0.18 (0.14)
------------- ------------- ------------- -------------
Weighted
average number
of shares,
diluted 30,813,960 30,968,108 30,648,991 30,900,122
------------- ------------- ------------- -------------
About Euroseas Ltd.
Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of
the Marshall Islands to consolidate the ship owning interests of the Pittas
family of Athens, Greece, which has been in the shipping business over the
past 136 years. Euroseas trades on the NASDAQ Global Market under the
ticker ESEA since January 31, 2007.
Euroseas operates in the dry cargo, drybulk and container shipping markets.
Euroseas' operations are managed by Eurobulk Ltd., an ISO 9001:2000
certified affiliated ship management company, which is responsible for the
day-to-day commercial and technical management and operations of the
vessels. Euroseas employs its vessels on spot and period charters and
through pool arrangements.
The Company has a fleet of 16 vessels, including 4 Panamax drybulk carriers
and 1 Handymax drybulk carrier, 3 Intermediate containership, 5 Handysize
containerships, 2 Feeder containerships and a multipurpose dry cargo
vessel. Euroseas` 5 drybulk carriers have a total cargo capacity of 331,808
dwt, its 10 containerships have a cargo capacity of 17,787 teu and its
multipurpose vessel has a cargo capacity of 22,568 dwt or 950 teu.
Forward-Looking Statement
This press release contains forward-looking statements (as defined in
Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended) concerning future events
and the Company's growth strategy and measures to implement such strategy;
including expected vessel acquisitions and entering into further time
charters. Words such as "expects," "intends," "plans," "believes,"
"anticipates," "hopes," "estimates," and variations of such words and
similar expressions are intended to identify forward-looking statements.
Although the Company believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given that
such expectations will prove to have been correct. These statements involve
known and unknown risks and are based upon a number of assumptions and
estimates that are inherently subject to significant uncertainties and
contingencies, many of which are beyond the control of the Company. Actual
results may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual results to
differ materially include, but are not limited to changes in the demand for
dry bulk vessels and container ships, competitive factors in the market in
which the Company operates; risks associated with operations outside the
United States; and other factors listed from time to time in the Company's
filings with the Securities and Exchange Commission. The Company expressly
disclaims any obligations or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to reflect any
change in the Company's expectations with respect thereto or any change in
events, conditions or circumstances on which any statement is based.
Visit our website www.euroseas.gr
Contact Information: Company Contact Tasos Aslidis Chief Financial Officer Euroseas Ltd. 11 Canterbury Lane, Watchung, NJ 07069 Tel. (908) 301-9091 E-mail: aha@euroseas.gr Investor Relations / Financial Media Nicolas Bornozis President Capital Link, Inc. 230 Park Avenue, Suite 1536 New York, NY 10169 Tel. (212) 661-7566 E-mail: nbornozis@capitallink.com