-- Net loss of $3.2 million or $0.10 loss per share basic and diluted on
total net revenues of $12.2 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 $1.4 million, or
$0.04 loss per share basic and diluted.
-- Adjusted EBITDA was $3.5 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 third
quarter of 2010 earning an average time charter equivalent rate of
$10,623 per day.
-- Declared a quarterly dividend of $0.06 per share for the third quarter
of 2010 payable on December 7, 2010 to shareholders of record on
November 26, 2010. This is the 21st consecutive quarterly dividend
declared.
First Nine Month 2010 Highlights:
-- Net loss of $5.7 million or $0.18 loss per share basic and diluted on
total net revenues of $39.7 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 $0.5 million, or
$0.02 loss per share basic and diluted.
-- Adjusted EBITDA was $13.4 million. Please refer to a subsequent section
of the Press Release for a reconciliation of adjusted EBITDA to net
income.
-- An average of 15.37 vessels were owned and operated during the first
nine months of 2010 earning an average time charter equivalent rate of
$11,645 per day.
-- Declared three quarterly dividends for a total of $0.17 per share
during the first nine months of 2010.
Euromar Joint Venture
-- Purchased 6 vessels since June 2010 investing almost half of its
committed capital of $175 million. Euroseas has committed $25 million
to the venture.
Aristides Pittas, Chairman and CEO of Euroseas commented: "During the third
quarter, October and first half of November 2010, we have continued to
capitalize on the strengthening of the containership market by
re-activating and chartering our two laid-up containerships at rates
positively contributing to our cash flow. All our containership vessels
are now operating. The reactivation of the above vessels and an increased
number of vessels going through drydock affected the results of the third
quarter. As our containership charters are rolled over from the existing
lower levels to rates reflecting the current market rates over the next 2
quarters, we expect to see a significant contribution to our earnings in
2011 and beyond. Our drybulk fleet continues to be fully covered for the
remainder of 2010 either via physical charters or via FFA contracts and we
expect to see little influence on our earnings from the developments in the
dry bulk market. For 2011, we have 60% secured cover at profitable rates
through a combination of physical charters and FFA contracts.
"Our Euromar joint venture has invested decisively in the containership
sector in line with our original investment thesis by purchasing or
agreeing to purchase -- and take delivery within 2010 -- a total of 6
containerships, four in the 2,500-2,800 teu range and 2 in the 1,700- 1,800
teu range. All 6 vessels are geared and built post 2000 with an average age
of approximately 7 years.
"We plan to exploit other attractive investment opportunities either
through our Euromar joint venture, as described above, or, by investing our
own funds as we did with the purchase of M/V Aggeliki P in June 2010.
"Our Board decided to maintain our quarterly dividend of $0.06 per share
which represents an annual yield of about 6% on the basis of our stock
price on November 12, 2010."
Tasos Aslidis, Chief Financial Officer of Euroseas commented: "The results
of the third quarter of 2010 reflect the strengthening of the containership
market compared to the first quarter of 2010 but also the lower level of
the charter rates our fleet has earned compared to the same period a year
ago. Our results 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.
"Total daily vessel operating expenses, including management fees, general
and administrative expenses but excluding drydocking costs, reflect a
decrease of about 2.0% during the third quarter of 2010 compared to the
same quarter of last year; and, a decrease of about 8.3% for the nine month
periods ended September 30, 2010 over the same period of 2009. As always,
we want to emphasize that cost control remains a key component of our
strategy.
"As of September 30, 2010, our outstanding debt was $62.5 million versus
restricted and unrestricted cash of about $23.2 million not including $3.7
million held as margin for our FFA contracts. As of the same date, our
scheduled debt repayments over the next 12 months amounted to about $12.6
million, a number low enough to provide us with significant operational
cash flow comfort. All our debt covenants were satisfied as of September
30, 2010."
Third Quarter 2010 Results:
For the third quarter of 2010, the Company reported total net revenues of
$12.2 million representing a 28.5% decrease over total net revenues of
$17.2 million during the third quarter of 2009. The Company reported net
loss for the period of $3.2 million as compared to a net income of $2.2
million for the third quarter of 2009. The results for the third quarter of
2010 include a $0.07 million net unrealized gain on derivatives and trading
securities and a $2.4 million net realized loss on derivatives as compared
to $2.0 million net unrealized gain on derivatives and trading securities
and $2.3 million realized loss on derivatives for the same period of 2009.
Depreciation expenses for the third quarter of 2010 were $4.6 million
compared to $5.1 million during the same period of 2009. On average, 16.00
vessels were owned and operated during the third quarter of 2010 earning an
average time charter equivalent rate of $10,623 per day compared to 16.79
vessels in the same period of 2009 earning on average $15,101 per day. M/V
Despina P, one of the Company's containerships, that was laid up since
March 2009 was reactivated in July 2010 and has entered in a time charter
contract that commenced in the first half of July 2010. A second
containership of the Company, M/V Jonathan P was reactivated from lay up
and entered into dry-dock during the third quarter of 2010.
Adjusted EBITDA for the third quarter of 2010 was $3.5 million, a 51.8%
decrease from $7.2 million achieved during the third 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 third quarter of 2010 were
$0.10, calculated on 30,932,211 basic and diluted weighted average number
of shares outstanding, compared to basic and diluted earnings per share of
$0.07 for the third quarter of 2009, calculated on 30,628,410 and
30,700,820, weighted average number of shares outstanding, respectively.
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 September 30,
2010 would have been $0.04 per share, basic and diluted, compared to
earnings of $0.07 per share for the quarter ended September 30, 2009.
Usually, security analysts do not include the above items in their
published estimates of earnings per share.
First nine months 2010 Results:
For the first nine months of 2010, the Company reported total net revenues
of $39.7 million representing a 16.1% decrease over total net revenues of
$47.3 million during the first nine months of 2009. The Company reported a
net loss for the period of $5.7 million as compared to net income of $0.7
million for the first nine months of 2009. The results for the first nine
months of 2010 include a $4.0 million net unrealized gain on derivatives
and trading securities and a $10.8 million net realized loss on derivatives
as compared to $2.5 million net unrealized loss on derivatives and trading
securities and $3.3 million net realized loss on derivatives for the same
period of 2009.
Depreciation expenses for the first nine months of 2010 were $13.4 million
compared to $14.4 million during the same period of 2009. On average,
15.37 vessels were owned and operated during the first nine months of 2010
earning an average time charter equivalent rate of $11,645 per day compared
to 16.17 vessels in the same period of 2009 earning on average $13,632 per
day. Two of the Company's vessels that were laid up during the entire
first half of 2010, were reactivated during the third quarter of the year.
Adjusted EBITDA for the first nine months of 2010 was $13.4 million, a
32.9% decrease from $20.0 million achieved during the first nine months of
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 the first nine months of 2010 was
$0.18, calculated on 30,877,513 weighted average number of shares
outstanding, compared to basic and diluted earnings per share of $0.02
basic and diluted per share for the first nine months of 2009, calculated
on 30,593,401 basic and 30,642,954 diluted weighted average number of
shares outstanding, respectively.
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 loss
per share for the nine-month period ended September 30, 2010 would have
been $0.02 per share compared to earnings of $0.18 per share, basic and
diluted, for the same period in 2009. Usually, security analysts do not
include the above items in their published estimates of earnings per share.
Fleet Profile:
The Euroseas Ltd. fleet profile is as follows:
Year
Name Type Dwt TEU Built Employment TCE Rate ($/day)
----------- ------- ------ ---- --------------- ---------------
Dry Bulk
Vessels
----------- ------- ------ ---- --------------- ---------------
PANTELIS Panamax 74,020 2000 TC 'til Feb-12 $ 17,500
----------- ------- ------ ---- --------------- ---------------
(currently
detained off
the coast of
Somalia after
ELENI P Panamax 72,119 1997 being hijacked)
----------- ------- ------ ---- --------------- ---------------
IRINI (*) Panamax 69,734 1988 Baumarine Pool
----------- ------- ------ ---- --------------- ---------------
ARISTIDES
N.P. Panamax 69,268 1993 TC 'til Mar-12 $ 18,900
----------- ------- ------ ---- --------------- ---------------
MONICA P Bulkhandling
(**) Handymax 46,667 1998 Pool
----------- ------- ------ ---- --------------- ---------------
Total Dry
Bulk
Vessels 5 331,808
----------- ------- ------ ---- --------------- ---------------
Multipurpose
Dry Cargo
Vessels
----------- ------- ------ ---- --------------- ---------------
$ 9,500 'til
Dec-10,
TASMAN $ 9,000 'til
TRADER 1 22,568 950 1990 TC 'til Mar-12 Mar-12
----------- ------- ------ ---- --------------- ---------------
Container
Carriers
----------- ------- ------ ---- --------------- ---------------
$ 16,800 'til
Aug-11
$ 18,735 'til
Aug-12
TC 'til Aug-11 $ 19,240 'til
(3 Annual Aug-13
MAERSK options 'til $ 19,750 'til
NOUMEA Intermediate 34,677 2,556 2001 Aug-14) Aug-14
----------- ------- ------ ---- --------------- ---------------
TC 'til Mar-11 $ 4,000
TIGER (options 'til
BRIDGE Intermediate 31,627 2,228 1990 Mar-12) $ 7,500
----------- ------- ------ ---- --------------- ---------------
AGGELIKI P Intermediate 30,360 2,008 1998 TC 'til May-11 $ 7,000
----------- ------- ------ ---- --------------- ---------------
DESPINA P Handy size 33,667 1,932 1990 TC 'til Nov-10 $ 7,500
----------- ------- ------ ---- --------------- ---------------
JONATHAN P $ 7,500 'til
(ex-OEL TC 'til Dec-10 Dec-10
INTEGRITY) Handy size 33,667 1,932 1990 TC 'til Apr-11 $ 9,000
----------- ------- ------ ---- --------------- ---------------
CAPTAIN
COSTAS
(ex-OEL
TRANS- Monthly options
WORLD) Handy size 30,007 1,742 1992 TC 'til Mar-11 $ 4,250
----------- ------- ------ ---- --------------- ---------------
YM PORT
KELANG
(ex-MASTRO
NICOS, ex-
YM XINGANG TC 'til Nov-10 $ 3,750
I) Handy size 23,596 1,599 1993 TC 'til Nov-11 $ 5,900
----------- ------- ------ ---- --------------- ---------------
MANOLIS P Handy size 20,346 1,452 1995 TC 'til May-11 $ 7,699
----------- ------- ------ ---- --------------- ---------------
NINOS
(ex-YM TC 'til
QINGDAO I) Feeder 18,253 1,169 1990 March-11 $ 6,800
----------- ------- ------ ---- --------------- ---------------
Monthly options
TC 'til Dec-10 $ 3,850
Then TC 'til
KUO HSIUNG 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
----------- ------- ------ ---- --------------- ---------------
Summary Fleet Data:
3 months, 3 months, 9 months, 9 months,
ended ended ended ended
September September September September
30, 2009 30, 2010 30, 2009 30, 2010
--------- --------- --------- ---------
FLEET DATA
Average number of vessels (1) 16.79 16.00 16.17 15.37
Calendar days for fleet (2) 1,545.0 1,472.0 4,414.0 4,197.0
Scheduled off-hire days incl.
laid-up (3) 331.5 171.7 704.5 595.3
Available days for fleet (4) =
(2) - (3) 1,213.5 1,300.3 3,709.5 3,601.7
Commercial off-hire days (5) 43.7 - 156.1 -
Operational off-hire days (6) 1.9 12.7 23.2 22.2
Voyage days for fleet (7) = (4)
- (5) - (6) 1,167.9 1,287.6 3,530.2 3,579.5
Fleet utilization (8) = (7) /
(4) 96.2% 99.0% 95.2% 99.4%
Fleet utilization, commercial
(9) = ((4) - (5)) / (4) 96.4% 100.0% 95.8% 100.0%
Fleet utilization, operational
(10) = ((4) - (6)) / (4) 99.8% 99.0% 99.4% 99.4%
AVERAGE DAILY RESULTS
Time charter equivalent rate
(11) 15,101 10,623 13,632 11,645
Vessel operating expenses excl.
drydocking expenses (12) 4,251 4,431 4,790 4,421
General and administrative
expenses (13) 504 228 645 565
Total vessel operating expenses
(14) 4,755 4,659 5,435 4,986
--------- --------- --------- ---------
Drydocking expenses (15) 1,238 1,161 433 848
--------- --------- --------- ---------
(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.
(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 net of voyage expenses by
available 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:
Tomorrow, Tuesday, November 16, 2010 at 8:30 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 replay of the conference call will be available until November 23, 2010.
The standard international replay number is 1(866) 247-4222; from the UK
0(800) 953-1533; the standard international replay number is (+44) (0) 1452
550 000 and the access code required for the replay is: 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 Third Quarter and First Nine months 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 Three
Months Months Nine Months Nine Months
Ended Ended Ended Ended
September September September September
30, 2009 30, 2010 30, 2009 30, 2010
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Voyage revenue 17,753,656 12,692,529 49,098,531 41,136,042
Commissions (586,301) (476,534) (1,774,961) (1,444,206)
Net revenues 17,167,355 12,215,995 47,323,570 39,691,836
Operating expenses
Voyage expenses 117,462 341,908 975,038 949,162
Vessel operating
expenses 5,235,285 5,256,057 17,435,904 15,013,547
Drydocking expenses 1,912,474 1,709,385 1,912,474 3,560,148
Depreciation 5,106,899 4,587,321 14,390,828 13,392,813
Management fees 1,332,991 1,265,533 3,707,350 3,541,078
Other general and
administrative
expenses 777,609 335,947 2,848,467 2,371,534
Charter termination
fees and other income - (1,327,808) (103,577) (1,481,308)
Total operating
expenses 14,482,720 12,168,343 41,166,484 37,346,974
Operating income 2,684,635 47,652 6,157,086 2,344,862
Other income/(expenses)
Interest and
finance cost (339,764) (366,886) (1,028,217) (1,091,862)
Loss on derivatives,
net (171,634) (2,338,324) (5,950,582) (6,686,258)
Realized & unrealized
gain/ (loss) on
trading securities (138,835) (24,293) 521,870 (104,802)
Foreign exchange
(loss)/ gain (945) (9,373) 23,902 (2,225)
Interest income 144,430 99,329 952,512 485,288
Other expenses, net (506,748) (2,639,547) (5,480,515) (7,399,859)
Equity Earnings (loss)
in joint venture - (622,219) - (622,219)
----------- ----------- ----------- -----------
Net income / (loss) 2,177,887 (3,214,114) 676,571 (5,677,216)
----------- ----------- ----------- -----------
Earnings (loss), per
share, basic 0.07 (0.10) 0.02 (0.18)
Weighted average number
of shares, basic 30,628,410 30,932,211 30,593,401 30,877,513
----------- ----------- ----------- -----------
Earnings (loss), per
share, diluted 0.07 (0.10) 0.02 (0.18)
----------- ----------- ----------- -----------
Weighted average number
of shares, diluted 30,700,820 30,932,211 30,642,954 30,877,513
----------- ----------- ----------- -----------
Euroseas Ltd.
Consolidated Condensed Balance Sheets
(All amounts expressed in U.S. Dollars - except share amounts)
December 31, September 30,
2009 2010
------------ ------------
(unaudited) (unaudited)
ASSETS
Current Assets:
Cash and cash equivalents 40,984,549 17,314,699
Due from Related company - 123,440
Trade accounts receivable 1,650,713 1,436,105
Other receivables, net 239,656 2,494,972
Inventories 1,869,238 1,608,471
Restricted cash 1,191,230 1,050,556
Other deposits 12,376,119 3,708,543
Trading securities 436,598 331,796
Prepaid expenses 185,137 381,066
Total current assets 58,933,240 28,449,648
Fixed assets:
Vessels, net 257,270,824 260,008,185
Long-term assets:
Restricted cash 6,500,000 4,800,000
Deferred charges, net 327,694 250,933
Derivatives 386,536 -
Investment in joint venture - 5,627,781
Total long-term assets 264,485,054 270,686,899
------------ ------------
Total assets 323,418,294 299,136,547
------------ ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Long term debt, current portion 14,030,000 12,570,000
Trade accounts payable 1,843,182 4,084,548
Accrued expenses 1,060,326 1,313,327
Accrued dividends 46,750 67,025
Deferred revenue 1,247,782 1,160,688
Derivatives 10,799,132 4,483,190
Due to related company 1,416,380 -
Total current liabilities 30,443,552 23,678,778
Long-term liabilities:
Long term debt, net of current portion 57,485,000 49,920,000
Derivatives 611,852 2,389,589
Fair value of below market time charter
acquired 3,424,627 1,844,815
Total long-term liabilities 61,521,479 54,154,404
Total liabilities 91,965,031 77,833,182
Shareholders' equity:
Common stock (par value $0.03, 200,000,000
shares authorized, 30,849,711 and
30,932,211 issued and outstanding,
respectively) 925,492 927,967
Preferred shares (par value $0.01,
20,000,000 shares authorized, no shares
issued and outstanding) - -
Additional paid-in capital 235,588,391 236,086,788
Accumulated deficit (5,060,620) (15,711,390)
Total shareholders' equity 231,453,263 221,303,365
------------ ------------
Total liabilities and shareholders' equity 323,418,294 299,136,547
------------ ------------
Euroseas Ltd.
Consolidated Condensed Statements of Cash Flows
(All amounts expressed in U.S. Dollars)
Nine Months Nine Months
Ended Ended
September 30, September 30,
2009 2010
------------- -------------
(unaudited) (unaudited)
------------- -------------
Cash flows from operating activities:
Net income (loss) 676,571 (5,677,216)
Adjustments to reconcile net income / loss to
net cash provided by operating activities:
Depreciation of vessels 14,390,828 13,392,813
Amortization of deferred charges 72,417 76,760
Amortization of fair value of time charters (1,092,951) (1,579,812)
Share-based compensation 709,714 500,873
Unrealized loss / (gain) on derivatives, net 2,640,022 (4,151,669)
Loss / (gain) in investment in joint venture - 622,219
Sale of trading securities 741,248 -
Realized gain on trading securities (411,444) -
Unrealized (gain) / loss on trading
securities (110,426) 104,802
Changes in operating assets and liabilities (6,120,457) 7,603,610
------------- -------------
Net cash provided by operating activities 11,495,522 10,892,380
------------- -------------
Cash flows from investing activities:
Purchase of vessels including improvements (62,224,639) (16,130,174)
Investment in joint venture - (6,250,000)
Change in restricted cash (613,129) 1,840,674
Proceeds from sale of vessels 5,980,487 -
------------- -------------
Net cash (used in) investing activities (56,857,281) (20,539,500)
------------- -------------
Cash flows from financing activities:
Issuance of share capital 4,023 -
Net proceeds from shares issued 645,242 -
Dividends paid (9,279,783) (4,953,279)
Offering expenses paid - (44,451)
Loan arrangements fees paid (208,000) -
Proceeds from long-term debt 33,000,000 -
Repayment of long-term debt (9,925,000) (9,025,000)
------------- -------------
Net cash provided by (used in) financing
activities 14,236,482 (14,022,730)
------------- -------------
Net decrease in cash and cash equivalents (31,125,277) (23,669,850)
Cash and cash equivalents at beginning of
period 73,851,191 40,984,549
------------- -------------
Cash and cash equivalents at end of period 42,725,914 17,314,699
------------- -------------
Euroseas Ltd.
Reconciliation of Adjusted EBITDA to
Net Income / (loss) and Cash Flow Provided By Operating Activities
(All amounts expressed in U.S. Dollars)
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
September September September September
30, 2009 30, 2010 30, 2009 30, 2010
------------ ------------ ------------ ------------
Net income / (loss) 2,177,887 (3,214,114) 676,571 (5,677,216)
------------ ------------ ------------ ------------
Interest and
finance costs, net
(incl. interest
income) 195,334 267,557 75,705 606,574
------------ ------------ ------------ ------------
Depreciation 5,106,899 4,587,321 14,390,828 13,392,813
------------ ------------ ------------ ------------
Loss on
derivatives, net 171,634 2,338,324 5,950,582 6,686,258
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of below market
time charter
acquired (669,136) (526,604) (2,746,373) (1,579,812)
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of above market
time charter
acquired 177,876 0 1,653,422 0
------------ ------------ ------------ ------------
Adjusted EBITDA 7,160,494 3,452,484 20,000,735 13,428,617
------------ ------------ ------------ ------------
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
September September September September
30, 2009 30, 2010 30, 2009 30, 2010
------------ ------------ ------------ ------------
Net cash flow
provided by
operating
activities 4,522,485 1,518,406 11,495,522 10,892,380
------------ ------------ ------------ ------------
Changes in
operating assets /
liabilities 446,942 72,526 6,120,457 (7,603,610)
------------ ------------ ------------ ------------
Loss on interest
rate and FFA
derivatives
(realized) 2,318,087 2,431,198 3,310,560 10,837,928
------------ ------------ ------------ ------------
Gain / (loss) on
trading securities
& investment in
joint venture, net (138,835) (646,512) 521,870 (727,021)
------------ ------------ ------------ ------------
Sale of trading
securities, net - - (741,248) -
------------ ------------ ------------ ------------
Share-based
compensation (157,713) (165,104) (709,714) (500,873)
------------ ------------ ------------ ------------
Interest, net 169,528 241,970 3,288 529,813
------------ ------------ ------------ ------------
Adjusted EBITDA 7,160,494 3,452,484 20,000,735 13,428,617
------------ ------------ ------------ ------------
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 (Gain) / Loss
on trading securities and Amortization of the Fair Value of Charters
Acquired to Net Income
(All amounts expressed in U.S. Dollars -
except share data and per share amounts)
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
September September September September
30, 2009 30, 2010 30, 2009 30, 2010
------------ ------------ ------------ ------------
Net income /
(loss) 2,177,887 (3,214,114) 676,571 (5,677,216)
------------ ------------ ------------ ------------
Unrealized loss /
(gain) on
derivatives, net (2,146,453) (92,874) 2,640,022 (4,151,669)
------------ ------------ ------------ ------------
Unrealized (gain) /
loss on trading
securities 138,835 24,293 (110,426) 104,802
------------ ------------ ------------ ------------
Realized loss on
derivatives 2,318,087 2,431,198 3,310,560 10,837,928
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of below market
time charter
acquired (669,136) (526,604) (2,746,373) (1,579,812)
------------ ------------ ------------ ------------
Amortization of
deferred revenue
of above market
time charter
acquired 177,876 - 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 1,997,096 (1,378,101) 5,423,776 (465,967)
------------ ------------ ------------ ------------
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 0.07 (0.04) 0.18 (0.02)
------------ ------------ ------------ ------------
Weighted average
number of shares,
basic 30,628,410 30,932,211 30,593,401 30,877,513
------------ ------------ ------------ ------------
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 0.07 (0.04) 0.18 (0.02)
------------ ------------ ------------ ------------
Weighted average
number of shares,
diluted 30,700,820 30,932,211 30,642,954 30,877,513
------------ ------------ ------------ ------------
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