SOURCE: Scorpio Bulkers Inc.

Scorpio Bulkers Inc.

July 28, 2015 08:28 ET

Scorpio Bulkers Inc. Announces Financial Results for the Second Quarter of 2015

MONACO--(Marketwired - Jul 28, 2015) - Scorpio Bulkers Inc. (NYSE: SALT) ("Scorpio Bulkers," or the "Company") today reported its results for the three and six months ended June 30, 2015 and 2014.

Results for the three and six months ended June 30, 2015 and 2014

For the three months ended June 30, 2015, the Company's adjusted net loss was $16.6 million (see Non-GAAP Measures section below), or $0.09 basic and diluted loss per share, which excludes (i) a write down on assets held for sale of $119.6 million and (ii) the $2.4 million write off of a portion of the deferred financing costs of two credit facilities, or $0.62 loss per share (see Non-GAAP Measures section below). For the three months ended June 30, 2015, the Company had a net loss of $138.6 million, or $0.71 basic and diluted loss per share. This loss includes the write down on assets held for sale of $119.6 million, a write off of $2.4 million of a portion of deferred financing costs accumulated on two credit facilities for which the commitments were reduced pursuant to the removal from the facilities of certain vessels that have been classified as held for sale, and the noncash amortization of stock-based compensation of $6.1 million.

For the three months ended June 30, 2014, the Company had a net loss of $15.0 million, or $0.11 basic and diluted loss per share. This loss includes the noncash amortization of stock-based compensation of $6.2 million.

For the six months ended June 30, 2015, the Company's adjusted net loss was $33.4 million (see Non-GAAP Measures section below), or $0.18 basic and diluted loss per share, which excludes (i) a write down on assets held for sale of $151.4 million and (ii) the $6.0 million write off of a portion of the deferred financing costs of three credit facilities, or $0.85 loss per share (see Non-GAAP Measures section below). For the six months ended June 30, 2015, the Company had a net loss of $190.7 million, or $1.03 basic and diluted loss per share. This loss includes the write down on assets held for sale of $151.4 million, a write off of $6.0 million of a portion of deferred financing costs accumulated on three credit facilities for which the commitments were reduced pursuant to the removal from the facilities of certain vessels that have been classified as held for sale, and the noncash amortization of stock-based compensation of $12.2 million.

For the six months ended June 30, 2014, the Company had a net loss of $25.7 million, or $0.19 basic and diluted loss per share. This loss includes the noncash amortization of stock-based compensation of $11.3 million.

Recent Significant Events

Public Offering

On June 16, 2015, the Company issued 133,000,000 shares of common stock, par value $0.01 per share ("Common Shares") at $1.50 per share in an underwritten public offering (the "Offering"). Scorpio Services Holding Limited purchased an aggregate of 10,000,000 Common Shares at the public offering price.

On June 23, 2015, underwriters exercised their option to purchase an additional 19,950,000 additional common shares in connection with the Offering.

Newbuilding Program Updates

On April 21, 2015, the Company announced that it entered into agreements to sell three Capesize newbuilding drybulk vessels, one Kamsarmax newbuilding drybulk vessel and three LR1 newbuilding product tankers to unrelated third-parties for approximately $290 million in aggregate. The Capesize vessels are currently being constructed in Romania, and have expected delivery dates between the fourth quarter of 2015 and the second quarter of 2016. The Kamsarmax vessel is currently being constructed in China and has an expected delivery date in the first quarter of 2016. The LR1 product tankers are currently being constructed in South Korea, two of which are scheduled for delivery during the second quarter of 2017 and one during the third quarter of 2017.

On April 27, 2015, the Company announced that it entered into agreements to sell two Capesize newbuilding drybulk vessels and one Ultramax newbuilding drybulk vessel to unrelated third-parties for approximately $111 million in aggregate. The Capesize vessels are currently being constructed in China and South Korea, and have expected delivery dates between the third quarter of 2015 and the second quarter of 2016. The Ultramax vessel is currently being constructed in China and has an expected delivery date in the first quarter of 2016.

On June 4, 2015, the Company announced that it entered into agreements to sell three Capesize newbuilding drybulk vessels and two LR2 product tankers under construction to unrelated third-parties for approximately $236 million in aggregate. The Capesize vessels are currently being constructed in China, and have expected delivery dates between the first quarter of 2016 and the second quarter of 2016. The LR2 product tankers (which were converted to Aframax tankers) are currently being constructed in Romania, and have expected delivery dates between the fourth quarter of 2016 and the first quarter of 2017.

The three LR1 newbuilding product tankers and the Kamsarmax newbuilding vessel were classified as held for sale during the three months ended March 31, 2015, for which the Company recorded a write down on assets held for sale of $30.7 million, reflective of these sales. The loss on disposal of the eight Capesize newbuilding vessels, one Ultramax newbuilding vessel, and two LR2 product tankers and incremental losses associated with assets held for sale as of March 31, 2015 was $119.6 million which was recorded during the second quarter of 2015.

Inclusive of the sales of construction contracts described above and other construction contracts previously classified as assets held for sale, we have agreed to sell 20 newbuilding construction contracts, consisting of eight Capesize newbuilding contracts, two Aframax tanker newbuilding contracts, two Kamsarmax newbuilding contracts, one Ultramax newbuilding contract, four LR2 product tanker newbuilding contracts and three LR1 product tanker newbuilding contracts. These sales are expected to result in approximately $197.0 million of aggregate cash proceeds to us, including refunds of deposits previously made, and an approximately $673.2 million reduction of our capital expenditure obligations.

Of the 20 newbuilding contracts we have agreed to sell, five Capesize newbuilding vessels, one Kamsarmax newbuilding vessel, one Ultramax newbuilding vessel, four LR2 newbuilding product tankers, two Aframax newbuilding tankers and three LR1 newbuilding product tankers have been sold and we are no longer under any obligation for remaining contractual installments under those contracts.

Fleet Financing Updates

$409.0 Million Credit Facility

Effective May 13, 2015, the commitment under our $409.0 Million Credit Facility was reduced by $73.0 million due to the sale of three Capesize vessels that were serving as partial security under the facility, and the addition of one Ultramax vessel to the security package under the facility. As a result of this reduction, during the second quarter of 2015, we also wrote off $2.1 million of deferred financing costs accumulated on this facility which represents the portion of the facility that can no longer be utilized.

$19.8 Million Credit Facility

On March 2, 2015, the Company closed a senior secured credit facility of up to $19.8 million. The facility was arranged by ABN AMRO Bank N.V., with insurance cover provided from China Export & Credit Insurance Corporation ("Sinosure"). The facility was to be used to finance a portion of the purchase price of one Kamsarmax vessel currently under construction at Tsuneishi Group Zhoushan Shipyard, China for delivery in Q1 2016. This Kamsarmax was classified as held for sale as of March 31, 2015, and was sold during April 2015. Accordingly, this facility was terminated on April 20, 2015 and the aggregate commitment fees paid of $0.4 million were written off during the second quarter of 2015.

$240.3 Million Credit Facility

On July 14, 2015, the Company's $240.264 million senior secured credit facility, which was expected to finance a portion of the purchase price of seven Capesize vessels under construction at Sungdong Shipbuilding & Marine Engineering Co., Ltd., was reduced by $34 million pursuant to the sale of one Capesize vessel contract described above, and the facility will be used to finance a portion of the purchase price of six Capesize vessels under construction, two of which have been delivered. As a result of this reduction, we expect to write off, during the third quarter of 2015, approximately $0.8 million of deferred financing costs accumulated on this facility which represents the portion of the facility that will no longer be utilized.

$230.3 Million Credit Facility

On March 2, 2015, the Company received a commitment from ABN AMRO Bank N.V. and The Export-Import Bank of China, for a loan facility of up to $230.3 million. This facility was arranged by ABN AMRO Bank N.V., with insurance cover to be provided from Sinosure. This facility will be used to finance a portion of the purchase price of seven Capesize vessels (of which one vessel has been delivered and six vessels are currently under construction at Shanghai Waigaoqiao Shipbuilding Co., Ltd., China) for delivery between Q1 2015 and Q2 2016. The terms and conditions of this facility, including covenants, will be similar to those in the Company's existing credit facilities and customary for financings of this type. The credit facility is pending approval from the Chinese Ministry of Finance on the insurance coverage to be provided by Sinosure, which is expected to be granted within the next three months. Pursuant to the sale of four Capesize vessel contracts, the facility is expected to be reduced by approximately $133 million and the facility will be used to finance a portion of the purchase price of three Capesize vessels (of which one vessel has been delivered for which we borrowed $26 million in bridge financing and two vessels are currently under construction).

Update on Fleet Financing

Including the credit facilities described above, the Company has now either signed credit facility agreements for or received commitments for 56 of the vessels in its fleet, excluding the vessels which the Company intends to sell. In addition, the Company has received proposals from four leading European financial institutions to finance a portion of the cost of our remaining four unfinanced dry bulk vessels. The terms and conditions of these facilities, for which commitments are expected during the third quarter of 2015, are consistent with those of the Company's existing credit commitments. The closing of any resultant credit facilities would remain subject to credit approval and customary conditions precedent, including negotiation and execution of definitive documentation.

Recent Newbuilding Vessels Deliveries

Between April 1, 2015 and July 27, 2015 the Company has taken delivery of the following newbuilding vessels:

  • SBI Camacho, a Capesize vessel, was delivered from Sungdong Shipbuilding & Marine Engineering Co., Ltd.
  • SBI Echo, an Ultramax vessel, was delivered from Imabari Shipbuilding Co., Ltd.
  • SBI Montesino, a Capesize vessel, was delivered from Sungdong Shipbuilding & Marine Engineering Co., Ltd.
  • SBI Lyra, an Ultramax vessel, was delivered from Dalian COSCO KHI Ship Engineering Co. Ltd.

As of July 27, 2015, the Company had $448.2 million in cash and cash equivalents.

Debt

We made the following drawdowns from our credit facilities during the three months ended June 30, 2015:

             
    Credit facility   Drawdown amount ($ thousands)   Collateral
1   $240.264 Million Credit Facility   $ 28,575   SBI Camacho
               

As of July 27, 2015, the Company's outstanding debt balance, and amount available to draw is as follows:

         
    As of June 30, 2015   As of July 27, 2015
    Amount outstanding   Amount outstanding   Amount available *
Senior Notes   $ 73,625   $ 73,625   $ --  
$39.6 Million Credit Facility     31,900     31,900     --  
$408.976 Million Credit Facility (1)     14,736     29,724     303,615  
$330 Million Credit Facility (2)     44,062     59,062     255,000  
$42 Million Credit Facility     19,964     19,964     21,000  
$67.5 Million Credit Facility     --     --     67,500  
$240.264 Million Credit Facility (1)     28,575     56,325     136,560  
$230.3 Million Credit Facility (3)     --     --     97,125  
$26 Million Credit Facility (4)     26,000     26,000     --  
Total available   $ 238,862   $ 296,600   $ 880,800  
Repayment of $26 Million Senior Secured Credit Facility                 (26,000 )
Total available               $ 854,800  
                     
 * Not including committed amounts with respect to vessels we intend to sell.
   
(1) As described above in this press release.
   
(2) One of the Ultramax vessels that was to collateralize this facility has been sold, as described above, and the credit facility is expected to be reduced by approximately $15 million.
   
   
(3) As described above in this press release, this credit facility is expected to be reduced by approximately $133 million pursuant to the sale of four Capesize vessels that were to collateralize it. In addition, the credit facility is pending approval from the Chinese Ministry of Finance on the insurance coverage to be provided by Sinosure, which is expected to be granted within the next three months.
   
(4) This is a credit facility which matures the earlier of (a) six months after the drawdown date or (b) ten business days after the date of which the $230.3 Million Credit Facility has been closed and can be drawn down. This financing is short-term in nature and must be repaid to draw down on the $230.3 Million Credit Facility.
   

Newbuilding Program

Our Newbuilding Program consists of contracts for the construction of 60 dry bulk vessels, comprised of 28 Ultramax newbuildings, 21 Kamsarmax newbuilding and 11 Capesize newbuildings. Of this total, through July 27, 2015, we have taken delivery of three Capesize, three Kamsarmax and six Ultramax vessels. The aggregate construction price for the remaining 48 drybulk vessels is $1,621.4 million. Of this amount, $994.3 million remains unpaid as of July 27, 2015 and is scheduled to be paid in installments through the delivery dates of each vessel. The estimated future payment dates and amounts are as follows (1):

           
Q3 2015   $ 253.2   million (2)
Q4 2015   270.4    
Q1 2016   237.9    
Q2 2016   153.2    
Q3 2016   79.6    
    $ 994.3   million
           

(1)  These are estimates only and are subject to change as construction progresses.
(2)  Relates to payments expected to be made from July 27, 2015 to September 30, 2015.    

Vessels Under Construction To Be Sold

We also have contracts for four vessels which we intend to sell, consisting of three Capesize vessels under construction and one Kamsarmax vessel under construction. Through July 27, 2015, we have paid $51.0 million under these contracts. These four contracts have an aggregate construction price of $199.5 million of which $148.5 million has not been paid as of July 27, 2015. Until these contracts are sold, the remaining installment payments under the terms of these contracts are estimated to be payable as follows (1):

           
Q3 2015   $ 32.0   million (2)
Q4 2015     --    
Q1 2016     77.7    
Q2 2016     38.8    
    $ 148.5   million
           

(1)  These are estimates only and are subject to change as construction progresses.
(2)  Relates to payments expected to be made from July 27, 2015 to September 30, 2015.    

Explanation of Components of Financial Results for the three months ended June 30, 2015 and 2014

For the three months ended June 30, 2015 and 2014, the Company recorded a net loss of $138.6 million and $15.0 million, respectively.

Time charter equivalent, or TCE revenue, a Non-GAAP measure, is vessel revenues less voyage expenses (including bunkers and port charges). TCE revenue is included herein because it is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance irrespective of changes in the mix of charter types (i.e., spot charters, time charters, and pool charters), and it provides useful information to investors and management.

TCE revenue was $12.8 million for the three months ended June 30, 2015, associated with 13 vessels time chartered-in and nine vessels owned compared to TCE revenue of $13.0 million during the three months ended June 30, 2014, associated with chartering in 19 vessels. TCE revenue per day was $6,737 and $8,867 for the three months ended June 30, 2015 and 2014, respectively (see the breakdown of daily TCE averages below). The decrease in TCE revenue during the three months ended June 30, 2015 compared to the prior year period is primarily attributable to the weakness in the dry bulk market. Such decrease occurred in spite of an increase in the number of revenue days, which increased to 1,897 days during the three months ended June 30, 2015 compared to 1,471 days during the prior year period.

Vessel operating costs for the three months ended June 30, 2015 were $4.5 million related to three Kamsarmax vessels, four Ultramax vessels and two Capesize vessels that we owned during the three months ended June 30, 2015. The Company did not own any vessels for the three months ended June 30, 2014 and, accordingly, did not have any vessel operating costs during that period.

Charterhire expense was $13.4 million and $19.9 million for the three months ended June 30, 2015 and 2014, respectively, relating to the time chartered-in vessels including those described below. Such decrease during the three months ended June 30, 2015 compared to the prior year period relates to a fewer number of vessels time chartered-in during the current year period. See the Company's Fleet List below for the terms of these agreements.

Depreciation for the three months ended June 30, 2015 was $2.6 million and relates to three Kamsarmax vessels, four Ultramax vessels and two Capesize vessels. The Company did not own any vessels for the three months ended June 30, 2014 and, accordingly, did not incur any depreciation during that period.

General and administrative expense was $8.6 million for the three months ended June 30, 2015. Such amount included $6.1 million restricted stock amortization (noncash) and the balance primarily related to payroll, directors' fees, professional fees and insurance. General and administrative expense was $8.5 million for the three months ended June 30, 2014, which included $6.2 million of restricted stock amortization.

During the three months ended June 30, 2015 the Company recorded a loss of $119.6 million associated with writing down nine contracts to construct vessels that the Company has classified as held for sale during the three months ended June 30, 2015 as well as incremental write downs of certain construction contracts classified as held for sale as of March 31, 2015. These nine contracts to construct vessels reclassified to assets held for sale during the three months ended June 30, 2015, include one Kamsarmax construction contract and two contracts for construction of Aframax product tankers (see recent significant events, below).

During the three months ended June 30, 2015, the Company recorded a $2.4 million loss associated with writing off a portion of deferred financing costs accumulated on two credit facilities for which the commitments were reduced pursuant to the removal from the facility of certain vessels that have been classified as held for sale.

Explanation of Components of Financial Results for the six months ended June 30, 2015 and 2014

For the six months ended June 30, 2015 and 2014, the Company recorded a net loss of $190.7 million and $25.7 million, respectively.

TCE revenue was $25.3 million for the six months ended June 30, 2015, associated with 20 vessels time chartered-in and nine vessels owned compared to TCE revenue of $15.5 million during the six months ended June 30, 2014, associated with chartering in 19 vessels. TCE revenue per day was $6,767 and $8,163 for the six months ended June 30, 2015 and 2014, respectively (see the breakdown of daily TCE averages below). The decrease in TCE revenue per day is due to the weakness in the drybulk market. The increase in TCE revenue during the six months ended June 30, 2015 compared to the prior year period is primarily attributable to the increase in the number of revenue days, which increased to 3,742 days during the three months ended June 30, 2015 compared to 1,895 days during the prior year period.

Vessel operating costs for the six months ended June 30, 2015 was $7.5 million related to three Kamsarmax vessels, four Ultramax vessels and two Capesize vessels. The Company did not own any vessels for the three months ended June 30, 2014 and, accordingly, did not have any vessel operating costs during that period.

Charterhire expense was $29.7 million and $26.6 million for the six months ended June 30, 2015 and 2014, respectively, relating to the time chartered-in vessels including those described below. This increase is due to a greater number of days for which vessels were chartered-in during the 2015 period compared to the 2014 period. See the Company's Fleet List below for the terms of these agreements.

Depreciation for the six months ended June 30, 2015 was $4.1 million and three Kamsarmax vessels, four Ultramax vessels and two Capesize vessels. The Company did not own any vessels for the six months ended June 30, 2014 and, accordingly, did not incur any depreciation during that period.

General and administrative expense was $16.9 million for the six months ended June 30, 2015. Such amount included $12.2 million of restricted stock amortization (noncash) and the balance primarily related to payroll, directors' fees, professional fees and insurance. General and administrative expense was $15.4 million for the six months ended June 30, 2014. Such amount included $11.3 million of restricted stock amortization (noncash) and the balance primarily related to payroll, directors' fees, professional fees and insurance.

During the six months ended June 30, 2015 the Company recorded a loss of $151.4 million associated with writing down 13 contracts to construct vessels that the Company has classified as held for sale during the six months ended June 30, 2015, as well as incremental write downs of certain construction contracts classified as held for sale as of December 31, 2014.

During the six months ended June 30, 2015, the Company recorded a $6.0 million loss associated with writing off a portion of deferred financing costs accumulated on three credit facilities for which the commitments were reduced pursuant to the removal from the facility of certain vessels that have been classified as held for sale.

 
Scorpio Bulkers Inc. and Subsidiaries
Consolidated Statements of Operations (unaudited)
(Dollars in Thousands, Except Per Share Data)
                       
  Three Months Ended June 30, 2015     Three Months Ended June 30, 2014     Six months ended June 30, 2015     Six months ended June 30, 2014  
Revenue:                              
  Vessel revenue $ 12,781     $ 13,180     $ 25,322     $ 18,647  
Operating expenses:                              
    Voyage expenses   -       132       -       3,180  
    Vessel operating costs   4,549       -       7,482       -  
    Charterhire expense   13,361       19,883       29,729       26,562  
    Vessel depreciation   2,563       -       4,130       -  
    General and administrative expenses   8,560       8,454       16,882       15,351  
    Write down on assets held for sale   119,604       -       151,355       -  
Total operating expenses   148,637       28,469       209,578       45,093  
Operating loss   (135,856 )     (15,289 )     (184,256 )     (26,446 )
Other income (expense):                              
    Interest income   61       269       129       793  
    Foreign exchange gain (loss)   (37 )     18       32       (5 )
    Financial expense, net   (2,813 )     -       (6,616 )     -  
Total other income (expense)   (2,789 )     287       (6,455 )     788  
Net loss $ (138,645 )   $ (15,002 )   $ (190,711 )   $ (25,658 )
                               
Loss per common share- basic and diluted (1) $ (0.71 )   $ (0.11 )   $ (1.03 )   $ (0.19 )
Weighted-average shares outstanding- basic and diluted (1)   195,636,762       133,236,911       184,606,749       132,925,640  
   
(1) Diluted weighted-average shares outstanding, which would include the impact of restricted shares, for the three months and for the six months ended June 30, 2015 and 2014, would be anti-dilutive since the Company is in a net loss position. As such, there is no difference between basic and diluted earnings per share for these periods.
   
   
   
Scorpio Bulkers Inc. and Subsidiaries
Consolidated Balance Sheets (unaudited)
(Dollars in Thousands, Except Per Share Data)
 
   
  June 30,     December 31,  
  2015     2014  
Current assets              
  Cash and cash equivalents $ 372,368     $ 272,673  
  Due from charterers   4,300       11,096  
  Due from related party   31,277       31,277  
  Prepaid expenses and other current assets   3,796       3,872  
  Assets held for sale   74,013       43,781  
Total current assets   485,754       362,699  
Non-current assets              
  Vessels, net   333,865       66,633  
  Vessels under construction   635,149       866,844  
  Deferred financing costs, net   5,919       3,181  
  Other assets   34,612       24,848  
  Total non-current assets   1,009,545       961,506  
Total assets $ 1,495,299     $ 1,324,205  
               
Liabilities and shareholders' equity              
Current liabilities              
  Bank loans $ 37,080     $ 3,300  
  Accounts payable and accrued expenses   15,935       17,042  
Total current liabilities   53,015       20,342  
Non-current liabilities              
  Bank loans   128,157       30,250  
  Senior Notes   73,625       73,625  
Total non-current liabilities   201,782       103,875  
Total liabilities   254,797       124,217  
Shareholders' equity              
  Common stock, $0.01 par value per share; authorized 450,000,000 shares; issued and outstanding 335,310,465 and 180,299,695 shares as of June 30, 2015 and December 31, 2014, respectively   3,353       1,803  
  Paid-in capital   1,550,732       1,321,057  
  Accumulated deficit   (313,583 )     (122,872 )
Total shareholders' equity   1,240,502       1,199,988  
Total liabilities and shareholders' equity $ 1,495,299     $ 1,324,205  
               
               
               
Scorpio Bulkers Inc. and Subsidiaries
Statements of Cash Flows (unaudited)
(Dollars in Thousands)
 
   
  Six months ended June 30, 2015     Six months ended June 30, 2014  
Operating activities              
Net loss $ (190,711 )   $ (25,658 )
Adjustment to reconcile net loss to net cash used byoperating activities:              
  Restricted stock amortization   12,172       11,278  
  Vessel depreciation   4,130       -  
  Amortization of deferred financing costs   562       -  
  Write off of deferred financing costs   5,968       -  
  Write down on assets held for sale   151,355       -  
Changes in operating assets and liabilities:              
  Decrease (increase) in amounts due from charterers   3,718       (17,338 )
  Decrease (increase) in prepaid expenses and other current assets   76       (2,314 )
  Increase in accounts payable and accrued expenses   659       1,829  
Net cash used in operating activities   (12,071 )     (32,203 )
Investing activities              
  Proceed from sale of assets held for sale   91,854       -  
  Payments on assets held for sale   (47,333 )     -  
  Payments for vessels and vessels under construction   (266,980 )     (397,000 )
Net cash used in investing activities   (222,459 )     (397,000 )
Financing activities              
  Proceeds from issuance of common stock   218,331       42,485  
  Proceeds from issuance of long-term debt   134,963       -  
  Repayments of long-term debt   (3,276 )     -  
  Debt issue costs paid   (15,793 )     (1,222 )
Net cash provided by financing activities   334,225       41,263  
Increase (decrease) in cash and cash equivalents   99,695       (387,940 )
Cash at cash equivalents, beginning of period   272,673       733,896  
Cash and cash equivalents, end of period $ 372,368     $ 345,956  
               
               
               
Scorpio Bulkers Inc. and Subsidiaries
Other Operating Data (unaudited)
(Dollars in Thousands, Except Per Day Data)
 
  Three Months Ended June 30, 2015   Three Months Ended June 30, 2014   Six months ended June 30, 2015   Six months ended June 30, 2014
Time Charter Equivalent Revenue (1):                      
  Vessel revenue $ 12,781   $ 13,180   $ 25,322   $ 18,647
  Voyage expenses   -     132     -     3,180
  Time charter equivalent revenue $ 12,781   $ 13,048   $ 25,322   $ 15,467
Time charter equivalent revenue attributable to:                      
  Kamsarmax $ 6,021   $ 9,794   $ 13,329   $ 12,027
  Ultramax   5,249     3,254     9,781     3,440
  Capesize   1,511     -     2,212     -
  $ 12,781   $ 13,048   $ 25,322   $ 15,467
Revenue days (1):                      
  Kamsarmax   967     1,151     2,107     1,560
  Ultramax   789     320     1,440     335
  Capesize   141     -     195     -
Combined   1,897     1,471     3,742     1,895
TCE per revenue day (1):                      
  Kamsarmax $ 6,226   $ 8,507   $ 6,326   $ 7,712
  Ultramax $ 6,653   $ 10,162   $ 6,790   $ 10,262
  Capesize $ 10,718   $ -   $ 11,368   $ -
  Combined $ 6,737   $ 8,867   $ 6,767   $ 8,163
   
(1) We define Time Charter Equivalent (TCE) revenue as voyage revenues less voyage expenses. Such TCE revenue, divided by the number of our available days during the period, or revenue days, is TCE per revenue day, which is consistent with industry standards. TCE per revenue day is a common shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per-day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts.
   
   
   
Fleet List as of July 27, 2015
 
Newbuilding Program
 
Owned vessels
 
Vessel Name   Year Built   DWT   Vessel Type
SBI Puro   2015   180,000   Capesize
SBI Camacho   2015   180,000   Capesize
SBI Montesino   2015   180,000   Capesize
Total Capesize       540,000    
SBI Cakewalk   2014   82,000   Kamsarmax
SBI Charleston   2014   82,000   Kamsarmax
SBI Samba   2015   84,000   Kamsarmax
Total Kamsarmax       248,000    
SBI Antares   2015   61,000   Ultramax
SBI Athena   2015   64,000   Ultramax
SBI Bravo   2015   61,000   Ultramax
SBI Leo   2015   61,000   Ultramax
SBI Echo   2015   61,000   Ultramax
SBI Lyra   2015   61,000   Ultramax
Total Ultramax       369,000    
Total Owned Vessels DWT       1,157,000    
 
 
Vessels under construction
 
Capesize            
    Vessel Name   Expected
Delivery (1)
  DWT   Shipyard
1   Hull H1310 - TBN SBI Valrico   Q3-15   180,000   Waigaoqiao
2   Hull H1311 - TBN SBI Maduro   Q3-15   180,000   Waigaoqiao
3   Hull S1211 - TBN SBI Magnum   Q3-15   180,000   Sungdong
4   Hull S1212 - TBN SBI Montecristo   Q4-15   180,000   Sungdong
5   Hull S1213 - TBN SBI Aroma   Q1-16   180,000   Sungdong
6   Hull S1214 - TBN SBI Cohiba   Q1-16   180,000   Sungdong
7   Hull HN1058 - TBN SBI Behike   Q4-15   180,000   Daehan
8   Hull HN1059 - TBN SBI Monterrey   Q4-15   180,000   Daehan
    Capesize NB DWT       1,440,000    
                 
                 
Kamsarmax            
                 
    Vessel Name   Expected
Delivery (1)
  DWT   Shipyard
1   Hull S1681 - TBN SBI Rumba   Q3-15   84,000   Imabari
2   Hull 1090 - TBN SBI Electra   Q3-15   82,000   Yangzijiang
3   Hull 1091 - TBN SBI Flamenco   Q4-15   82,000   Yangzijiang
4   Hull 1092 - TBN SBI Rock   Q4-15   82,000   Yangzijiang
5   Hull 1093 - TBN SBI Twist   Q1-16   82,000   Yangzijiang
6   Hull S1228 - TBN SBI Capoeira   Q3-15   82,000   Hudong
7   Hull S1722A - TBN SBI Conga   Q4-15   82,000   Hudong
8   Hull S1723A - TBN SBI Bolero   Q4-15   82,000   Hudong
9   Hull S1229 - TBN SBI Carioca   Q3-15   82,000   Hudong
10   Hull S1724A - TBN SBI Sousta   Q4-15   82,000   Hudong
11   Hull S1725A - TBN SBI Reggae   Q1-16   82,000   Hudong
12   Hull S1726A - TBN SBI Zumba   Q1-16   82,000   Hudong
13   Hull S1231 - TBN SBI Macarena   Q2-16   82,000   Hudong
14   Hull S1735A - TBN SBI Parapara   Q1-16   82,000   Hudong
15   Hull S1736A - TBN SBI Mazurka   Q2-16   82,000   Hudong
16   Hull S1230 - TBN SBI Lambada   Q1-16   82,000   Hudong
17   Hull S1232 - TBN SBI Swing   Q3-16   82,000   Hudong
18   Hull S1233 - TBN SBI Jive   Q3-16   82,000   Hudong
    Kamsarmax NB DWT       1,478,000    
Ultramax            
                 
    Vessel Name   Expected
Delivery
(1)
  DWT   Shipyard
1   Hull 1907 - TBN SBI Hera   Q2-16   60,200   Mitsui
2   Hull 1906 - TBN SBI Zeus   Q2-16   60,200   Mitsui
3   Hull 1911 - TBN SBI Poseidon   Q2-16   60,200   Mitsui
4   Hull 1912 - TBN SBI Apollo   Q2-16   60,200   Mitsui
5   Hull S871 - TBN SBI Tango   Q3-15   61,000   Imabari
6   Hull S-A098 - TBN SBI Achilles   Q1-16   61,000   Imabari
7   Hull S-A089 - TBN SBI Cronos   Q4-15   61,000   Imabari
8   Hull S-A090 - TBN SBI Hermes   Q1-16   61,000   Imabari
9   Hull NE182 - TBN SBI Maia   Q3-15   61,000   Nacks
10   Hull NE183 - TBN SBI Hydra   Q3-15   61,000   Nacks
11   Hull NE194 - TBN SBI Hyperion   Q2-16   61,000   Nacks
12   Hull NE195 - TBN SBI Tethys   Q2-16   61,000   Nacks
13   Hull DE020 - TBN SBI Subaru   Q3-15   61,000   Dacks
14   Hull DE021 - TBN SBI Ursa   Q3-15   61,000   Dacks
15   Hull CX0612 - TBN SBI Thalia   Q4-15   64,000   Chengxi
16   Hull CX0653 - TBN SBI Hercules   Q1-16   64,000   Chengxi
17   Hull CX0627 - TBN SBI Perseus   Q1-16   64,000   Chengxi
18   Hull CX0655 - TBN SBI Samson   Q2-16   64,000   Chengxi
19   Hull CX0613 - TBN SBI Phoebe   Q3-16   64,000   Chengxi
20   Hull CX0656 - TBN SBI Phoenix   Q3-16   64,000   Chengxi
21   Hull CX0652 - TBN SBI Orion   Q4-15   64,000   Chengxi
22   Hull CX0651 - TBN SBI Pegasus   Q3-15   64,000   Chengxi
    Ultramax NB DWT       1,362,800    
    Total Newbuild DWT       4,280,800    
 
 
Vessels to be Sold
 
 
    Vessel Name   Expected
Delivery
(1)
  DWT   Shipyard
1   Hull H1365 - TBN SBI Corona   Q1-16   180,000   Waigaoqiao
2   Hull H1366 - TBN SBI Diadema   Q1-16   180,000   Waigaoqiao
3   Hull H1367 - TBN SBI Estupendo   Q2-16   180,000   Waigaoqiao
    Total Capesize NB DWT       540,000    
1   Hull SS164 - TBN SBI Salsa   Q3-15   81,600   Tsuneishi
    Total Kamsarmax NB DWT       81,600    
4   Total Vessels Held for Sale DWT       621,600    
                 

As used in this earnings release "Dacks" refers to Dalian COSCO KHI Ship Engineering Co. Ltd., "Daehan" refers to Daehan Shipbuilding Co., Ltd., "Chengxi" refers to Chengxi Shipyard Co., Ltd., "Hudong" refers to Hudong-Zhonghua Shipbuilding (Group) Co., Inc., "Imabari" refers to Imabari Shipbuilding Co. Ltd., "Mitsui" refers to Mitsui Engineering & Shipbuilding Co. Ltd., "Nacks" refers to Nantong COSCO KHI Ship Engineering Co., Ltd., "Sungdong" refers to Sungdong Shipbuilding & Marine Engineering Co., Ltd., "Tsuneishi" refers to Tsuneishi Group (Zhoushan) Shipbuilding Inc., "Waigaoqiao" refers to Shanghai Waigaoqiao Shipbuilding Co., Ltd., and "Yangzijiang" refers to Jiangsu Yangzijiang Shipbuilding Co. Ltd.

   
(1) Expected delivery date relates to the quarter during which each vessel is currently expected to be delivered from the shipyard.
   

Time chartered-in vessels

The Company has time chartered-in 11 dry bulk vessels. The terms of the time charter-in contracts are summarized as follows:

                     
Vessel Type   Year Built   DWT   Where Built   Daily Base Rate   Earliest Expiry
Post-Panamax   2012   98,700   China   $ 13,000   22-Dec-16   (1)
Post-Panamax   2009   93,000   China   See Note (2)   26-Sep-15   (2)
Post-Panamax   2011   93,000   China   $ 9,500   21-Aug-15   (3)
Kamsarmax   2012   82,000   South Korea   $ 15,500   30-Jul-17   (4)
Kamsarmax   2011   81,500   South Korea   $ 15,000   14-Jan-16   (5)
Panamax   2004   77,500   China   $ 14,000   03-Jan-17   (6)
Ultramax   2010   61,000   Japan   $ 14,200   01-Mar-17   (7)
Supramax   2010   58,000   China   $ 14,250   27-Nov-15   (8)
Supramax   2008   58,000   China   $ 12,250   13-Jun-16   (9)
Supramax   2015   55,000   Japan   $ 14,000   26-Nov-17   (10)
Handymax   2002   48,500   Japan   $ 12,000   16-Mar-17   (11)
Total TC DWT       806,200                
   
(1) This vessel has been time chartered-in for 21 to 25 months at the Company's option at $13,000 per day. The Company has the option to extend this time charter for one year at $14,000 per day. This vessel was delivered February 22, 2015.
   
(2) This vessel has been time chartered-in for ten to 14 months at the Company's option at a rate of 90% of the Baltic Panamax 4TC Index. The Company has the option to extend this time charter for an additional ten to 14 months at the same rate of hire. The vessel was delivered on July 9, 2014.
   
(3) This vessel has been time chartered-in for 11 to 13 months at the Company's option at $9,500 per day. The Company has the option to extend this time charter for one year at $11,500 per day. The vessel was delivered on September 11, 2014.
   
(4) This vessel has been time chartered-in for 39 to 44 months at the Company's option at $15,500 per day. The Company has the option to extend this time charter for one year at $16,300 per day. The vessel was delivered on April 23, 2014.
   
(5) This vessel has been time chartered-in for 23 to 28 months at the Company's option at $15,000 per day. The Company has the option to extend the charter for an additional 11 to 13 months at $16,000 per day. This vessel was delivered on February 15, 2014.
   
(6) This vessel has been time chartered-in for 32 to 38 months at the Company's option at $14,000 per day. The vessel was delivered on May 3, 2014.
   
(7) This vessel has been time chartered-in for three years at $14,200 per day. The Company has options to extend the charter for up to three consecutive one year periods at $15,200 per day, $16,200 per day and $17,200 per day, respectively. This vessel was delivered on April 13, 2014.
   
(8) This vessel has been time chartered-in for 20 to 24 months at the Company's option at $14,250 per day. The Company has the option to extend the charter for an additional ten to 12 months at $14,850 per day. This vessel was delivered on April 12, 2014.
   
(9) This vessel has been time chartered-in for 21 to 25 months at the Company's option at $12,250 per day. The Company has the option to extend this time charter for one year at $13,000 per day. The vessel was delivered on September 13, 2014.
   
(10) This vessel has been time chartered-in for three years at $14,000 per day. The Company has options to extend the charter for up to two consecutive one year periods at $15,000 per day and $16,000 per day, respectively. This vessel was delivered January 27, 2015.
   
(11) This vessel has been time chartered-in for 34 to 37 months at the Company's option at $12,000 per day. The Company has options to extend the charter for up to three consecutive one year periods at $12,750 per day, $13,600 per day and $14,800 per day, respectively. This vessel was delivered on March 31, 2014.
   

Conference Call Details:
Tuesday, July 28, 2015 at 11:00 AM Eastern Daylight Time and 5:00 PM Central European Summer Time

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1-(866)-409-1556 (U.S.) or 1-(913)-312-1455 (International). The conference participant passcode is 3958538. The information provided on the teleconference is only accurate at the time of the conference call, and the Company will take no responsibility for providing updated information.

Slides and Audio Webcast:
There will also be a simultaneous live webcast over the internet, through the Scorpio Bulkers Inc. website www.scorpiobulkers.com. Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

Webcast URL: http://www.visualwebcaster.com/event.asp?id=102663

About Scorpio Bulkers Inc.

Scorpio Bulkers Inc. is a provider of marine transportation of dry bulk commodities. Scorpio Bulkers Inc. currently owns 12 vessels, consisting of three Capesize, three Kamsarmax vessels and six Ultramax vessels. The Company also time charters-in 11 dry bulk vessels (consisting of one Handymax, one Ultramax, three Supramax, one Panamax, two Kamsarmax and three Post-Panamax vessels) and has contracted for 52 dry bulk vessels consisting of 22 Ultramax, 19 Kamsarmax (including one vessel held for sale) and 11 Capesize vessels (including three vessels held for sale), from shipyards in Japan, South Korea and China. Upon final delivery of all of the vessels the owned fleet is expected to have a total carrying capacity of approximately 5.4 million deadweight tonnes. Additional information about the Company is available on the Company's website www.scorpiobulkers.com, which is not a part of this press release.

Non-GAAP Measures

This press release describes adjusted net loss, which is not a measure prepared in accordance with GAAP. The Non-GAAP measure presented in this press release as we believe that it provides investors with a means of evaluating and understanding how the Company's management evaluates the Company's operating performance. These Non-GAAP measures should not be considered in isolation from, as substitutes for, or superior to financial measures prepared in accordance with GAAP.

Adjusted net loss
In thousands, except per share data

     
  For the three months ended June 30,  
  2015     2014  
  Amount (unaudited)     Per share (unaudited)     Amount (unaudited)     Per share (unaudited)  
Net loss $ (138,645 )   $ (0.71 )   $ (15,002 )   $ (0.11 )
Adjustments:                              
  Write down of assets held for sale   119,604       0.61       -       -  
  Write down of deferred financing cost   2,438       0.01       -       -  
Total adjustments   122,042       0.62       -       -  
Adjusted net loss $ (16,603 )   $ (0.09 )   $ (15,002 )   $ (0.11 )
     
     
  For the six months ended June 30,  
  2015     2014  
  Amount (unaudited)     Per share (unaudited)     Amount (unaudited)     Per share (unaudited)  
Net loss $ (190,711 )   $ (1.03 )   $ (25,658 )   $ (0.19 )
Adjustments:                              
  Loss on disposal of assets   151,355       0.82       -       -  
  Write down of deferred financing cost   5,968       0.03       -       -  
Total adjustments   157,323       0.85       -       -  
Adjusted net loss $ (33,388 )   $ (0.18 )   $ (25,658 )   $ (0.19 )
                               

Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words "believe," "anticipate," "intend," "estimate," "forecast," "project," "plan," "potential," "may," "should," "expect," "pending" and similar expressions identify forward-looking statements.

The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the failure of counterparties to fully perform their contracts with us, the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for dry bulk vessel capacity, changes in our operating expenses, including bunker prices, drydocking and insurance costs, the market for our vessels, availability of financing and refinancing, charter counterparty performance, ability to obtain financing and comply with covenants in such financing arrangements, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, vessels breakdowns and instances of off-hires and other factors. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties.

Contact Information

  • Contact:

    Scorpio Bulkers Inc.
    +377-9798-5715 (Monaco)
    +1-646-432-1675 (New York)