-- Net Revenues of $25.9 million -- EBITDA of $10.7 million -- Net Loss of $2.6 millionYear Ended 2010
-- Net Revenues of $95.9 million -- EBITDA of $47.3 million -- Net Income of $1.6 million (before noncontrolling interest)Management Discussion: Dale Ploughman, the Company's Chairman and Chief Executive Officer, stated: "We are pleased with the annual and quarterly results that we are reporting. The fourth quarter of 2010 saw the successful implementation of our plan to grow Seanergy's fleet as we completed the acquisition of the remaining 50% ownership interest in Bulk Energy Transport (Holdings) Limited ("BET") in October 2010. This year therefore set an important milestone for our company, as the consolidation of our ownership interests in BET and Maritime Capital Shipping Limited ("MCS") more than tripled our wholly owned fleet from an initial base of six vessels with a carrying capacity of 316,676 deadweight tons to a total of 20 vessels with a carrying capacity of 1,293,105 deadweight tons. It is of particular importance that we have achieved the above by acquiring assets at favorable prices, as we paid approximately $95 million in 2010, of which only $43 million was in the form of cash and the remainder was in the form of shares. This way, we believe that we managed to increase our earnings potential while maintaining a strong balance sheet and we therefore believe we remain well positioned to invest in further opportunities to acquire vessels that we believe will be accretive to our earnings. Furthermore, gaining exposure to all segments of the dry bulk industry has, in our view, enhanced the operational flexibility of our fleet. We have significant time charter coverage with reputable charterers, which we believe provides cash flow stability and a degree of protection against the volatile freight rate environment, coupled with upside potential, as five of our vessels in total operate under profit sharing arrangements that allow us to participate in market upswings. The fourth quarter of 2010 was characterized by freight market deterioration that continued into the new year, as the extended flooding in Australia led to disruption in coal trade that we previously viewed as providing support to freight rates up until that time, especially for larger vessel segments. As the situation unfolds in Australia, we believe it is possible that short term disruptions will subside and that freight rates may revert to normality. We believe that long term dry bulk fundamentals remain solid as world industrial production is poised to continue growing due to growth witnessed in emerging markets. According to the International Monetary Fund, growth in emerging markets is expected to continue at the same pace and estimates for US GDP growth were revised upwards on the back of improved consumer demand. The major downside risk for dry bulk shipping remains the issue of vessel oversupply. Vessels scheduled for 2011 delivery represent about 25% of the current dry bulk fleet, yet much of that comes from 2010 deliveries that were pushed back due to lack of sufficient funding available to ship owners. In 2010 slippage amounted to about 40% of the orderbook and we believe that the trend is poised to continue as financing for new vessels is increasingly hard to attain for all but the most solid companies in the sector. Furthermore, the vast majority of the order book represents orders contracted before 2009, at prices considerably higher than current market levels therefore making them poor investments considering current conditions. In addition, scrapping activity in the first month of 2011 has been much higher than the comparable period in 2010, according to industry sources. High prices paid for scrap sales (around $500 / LDT in 2011) combined with the recent fall in freight rates have contributed to this trend and are expected to further increase demolitions, especially as Bangladeshi yards start coming online later in the year." Christina Anagnostara, the Company's Chief Financial Officer, stated: "We believe that 2010 was a good year for Seanergy, as we increased our owned fleet to 20 vessels and our total assets from $538.5 million at the end of 2009 to $696.4 million at the end of 2010. As of December 31, 2010, our cash reserves were $64.2 million, reflecting $31.5 million in cash generated from operations. In the fourth quarter of 2010, our company operated a fleet of 20 vessels earning a time charter equivalent ("TCE") rate of $15,277 as compared to an average of 11 vessels and TCE rate of $17,331 during the fourth quarter of 2009. The decreased TCE results from lower market imposed time charter rates earned by our vessels, whose original charter agreements expired during 2009. Furthermore, we have accelerated the drydocking for three vessels initially scheduled for 2011 to the third and fourth quarters of 2010. As a result of the timing of these inspections, Seanergy incurred more off-hire days than expected during the fourth quarter of 2010, resulting in lower revenues and higher operating expenses than anticipated. Our vessels have secured period employment of 79% for 2011, 38% for 2012 and 19% for 2013. For the year ended 2010, our company operated a fleet of 16.6 vessels on average, earning a TCE rate of $16,532 as compared to an average of 7.9 vessels and TCE rate of $32,909 during 2009. In 2010, our daily vessel operating expenses decreased to $5,077 from $5,603 in 2009, and daily general and administrative expenses decreased to $1,375 in 2010 from $2,304 in 2009." Fourth Quarter 2010 Financial Results: Net Revenues Net Revenues for the fourth quarter of 2010 increased to $25.9 million from $17.3 million in the same quarter in 2009. The increase in revenues, despite earning a lower average TCE rate, reflects the increased size of our fleet, which resulted in additional operating days. EBITDA, Operating Income EBITDA was $10.7 million for the fourth quarter of 2010 as compared to $7.4 million in the same quarter in 2009. Operating income amounted to $1.1 million for the three months ended December 31, 2010, as compared to an operating income of $0.8 million for the same quarter in 2009. The rise in EBITDA and operating income in the fourth quarter was mainly a result of revenue growth, which was adequate to offset the effects of higher operating expenditures and depreciation expense. Please refer to the EBITDA reconciliation section, contained in this press release. Net Loss For the fourth quarter of 2010, Net Loss amounted to $2.6 million, or $0.02 per basic and diluted share, as compared to Net Loss of $3.2 million, or $0.10 per basic and diluted share, in the same quarter of 2009, based on weighted average common shares outstanding of 109,723,980 basic and diluted for 2010; 33,255,170 basic and diluted for 2009. The loss is primarily the result of a 12% decrease in TCE to $15,277 per day in the fourth quarter of 2010 from $17,331 per day in the same quarter of 2009, as well as an increase in net interest expense to $3.8 million from $2.3 million. Year Ended 2010 Financial Results: Net Revenues Net Revenues for the year ended December 31, 2010 were $95.9 million as compared to $87.9 million in the same period in 2009. Our vessels earned a lower average TCE rate during 2010, yet this was counteracted by the increase in the number of operating days associated with the growth in the size of our fleet. EBITDA, Operating Income EBITDA for the twelve months ending December 31, 2010 was $47.3 million as compared to $66.6 million in the previous year. Operating Income amounted to $18.4 million for the year ended December 31, 2010, as compared to operating income of $40.4 million for the same period in 2009. The decrease in operating income came as a result of increased operating and voyage expenses, as well as increased depreciation and dry docking expenses associated with operating a larger fleet. For 2010, operating expenses increased to $30.7 million, from $16.2 million in the previous year. Net Income Net Income for 2010 amounted to $1.6 million before non controlling interest. Net Income attributable to Seanergy was $0.1 million, or $0.00 per basic and diluted share for the period ended December 31, 2010, as compared to Net Income of $30.0 million, or $1.16 per basic and $1.00 per diluted share, for the same period in 2009, based on weighted average common shares outstanding of 87,916,947 basic and diluted for 2010 and 25,882,967 and 30,529,281 basic and diluted for 2009, respectively. The decrease in net income is the result of lower operating income earned in 2010, combined with higher interest expenses and losses on interest rate swaps. In particular, net interest and finance costs increased to $12.6 million in 2010, from $7.2 million in 2009 due to additional interest expense charges relating to MCS loan facilities. Losses on swap agreements for 2010 rose to $4.2 million from $1.6 million in 2009. Operating Cash Flow and Cash Flow from Investments In 2010, Seanergy generated $31.5 million of cash from operations, as opposed to $43.2 million in 2009. The decrease is mainly attributable to lower net income earned in the current year. Investment cash inflows for 2010 amounted to $7.9 million, as compared to $36.4 million in 2009. Positive cash flows reflect the cash acquired as part of the MCS and BET transactions in 2010 and 2009. Debt Repayment and capital expenditure requirements for 2011 Seanergy ended 2010 with $399.5 million of outstanding debt, as compared to $300.6 million at the end of 2009. The increase is associated with additional debt assumed through the acquisition of the MCS fleet. Repayment of principal on our debt facilities is expected to reach $53.4 million over the course of 2011. In terms of maintenance capital expenditure, we expect to incur about $4.1 million in drydocking costs for the year ending 2011.
Fleet Data:
Three Months Three Months
Year Ended Year Ended Ended Ended
December 31, December 31, December 31, December 31,
2010 2009 2010 2009
----------- ----------- ----------- -----------
Fleet Data
----------- ----------- ----------- -----------
Average number of
vessels (1) 16.6 7.9 20.0 11.0
----------- ----------- ----------- -----------
Ownership days (2) 6,040 2,895 1,840 1,012
----------- ----------- ----------- -----------
Available days (3) 5,662 2,638 1,642 983
----------- ----------- ----------- -----------
Operating days (4) 5,627 2,614 1,630 969
----------- ----------- ----------- -----------
Fleet utilization (5) 93.2% 90.3% 88.6% 95.8%
----------- ----------- ----------- -----------
Fleet utilization
excluding drydocking
off hire days (6) 99.4% 99.1% 99.3% 98.6%
----------- ----------- ----------- -----------
Average Daily Results
----------- ----------- ----------- -----------
TCE rate (7) $ 16,532 $ 32,909 $ 15,277 $ 17,331
----------- ----------- ----------- -----------
Vessel operating
expenses (8) $ 5,077 $ 5,603 $ 5,689 $ 6,389
----------- ----------- ----------- -----------
Management fee (9) $ 438 $ 592 $ 394 $ 628
----------- ----------- ----------- -----------
Total vessel operating
expenses (10) $ 5,515 $ 6,195 $ 6,083 $ 7,017
----------- ----------- ----------- -----------
(1) Average number of vessels is the number of vessels that constituted the
Company's fleet for the relevant period, as measured by the sum of the
number of days each vessel was a part of the Company's fleet during the
relevant period divided by the number of calendar days in the relevant
period.
(2) Ownership days are the total number of days in a period during which
the vessels in a fleet have been owned. Ownership days are an indicator of
the size of the Company's fleet over a period and affect both the amount of
revenues and the amount of expenses that the Company recorded during a
period.
(3) Available days are the number of ownership days less the aggregate
number of days that vessels are off-hire due to major repairs, dry dockings
or special or intermediate surveys. The shipping industry uses available
days to measure the number of ownership days in a period during which
vessels should be capable of generating revenues. During the year ended
December 31, 2010, the Company incurred 378 off hire days for vessel
scheduled drydocking. During the three months ended December 31, 2010, the
Company incurred 198 off hire days for vessel scheduled drydocking.
(4) Operating days are the number of available days in a period less the
aggregate number of days that vessels are off-hire due to any reason,
including unforeseen circumstances. The shipping industry uses operating
days to measure the aggregate number of days in a period during which
vessels actually generate revenues.
(5) Fleet utilization is the percentage of time that our vessels were
generating revenue, and is determined by dividing operating days by
ownership days for the relevant period.
(6) Fleet utilization excluding drydocking off hire days is calculated by
dividing the number of the fleet's operating days during a period by the
number of available days during that period. The shipping industry uses
fleet utilization excluding drydocking off hire days to measure a Company's
efficiency in finding suitable employment for its vessels and excluding the
amount of days that its vessels are off hire for reasons such as scheduled
repairs, vessel upgrades, or dry dockings or special or intermediate
surveys.
(7) TCE rates are defined as our net revenues less voyage expenses during a
period divided by the number of our operating days during the period, which
is consistent with industry standards. Voyage expenses include port
charges, bunker (fuel oil and diesel oil) expenses, canal charges and other
commissions.
(In thousands of US Dollars, except operating days and daily time charter
equivalent rate)
Three Months Ended
Year Ended December 31, December 31,
------------------------ ------------------------
2010 2009 2010 2009
----------- ----------- ----------- -----------
Net revenues from
vessels 95,856 87,897 25,861 17,289
Voyage expenses (2,833) (1,872) (959) (495)
----------- ----------- ----------- -----------
Net operating revenues 93,023 86,025 24,902 16,794
=========== =========== =========== ===========
Operating days 5,627 2,614 1,630 969
Daily time charter
equivalent rate 16,532 32,909 15,277 17,331
(8) Average daily vessel operating expenses, which include crew costs,
provisions, deck and engine stores, lubricating oil, insurance, maintenance
and repairs, are calculated by dividing vessel operating expenses by
ownership days for the relevant time periods:
(In thousands of US Dollars, except ownership days and daily vessel
operating expenses)
Three Months Ended
Year Ended December 31, December 31,
------------------------- -------------------------
2010 2009 2010 2009
------------ ------------ ------------ ------------
Operating expenses 30,667 16,222 10,467 6,466
Ownership days 6,040 2,895 1,840 1,012
Daily vessel operating
expenses 5,077 5,603 5,689 6,389
(9) Daily management fees are calculated by dividing total management fees
by ownership days for the relevant time period.
(10) Total vessel operating expenses ("TVOE") is a measurement of total
expenses associated with operating the vessels. TVOE is the sum of vessel
operating expenses and management fees. Daily TVOE is calculated by
dividing TVOE by fleet ownership days for the relevant time period.
Fleet Profile and Employment:
Fleet Profile as of February 17, 2011
Charter
Vessel Name Vessel Capacity Year Expiry
Class (DWT) Built Charter Rate ($) (latest)
--------- --------- ----- ---------------- ---------
M/V Bremen Max Panamax 73,503 1993 spot positioning Feb. 2011
--------- --------- ----- ---------------- ---------
M/V Hamburg Max (1) Panamax 72,338 1994 21,500 Oct. 2012
--------- --------- ----- ---------------- ---------
M/V Davakis G. Supramax 54,051 2008 spot positioning Feb. 2011
--------- --------- ----- ---------------- ---------
M/V Delos Ranger Supramax 54,051 2008 spot positioning Feb. 2011
--------- --------- ----- ---------------- ---------
M/V African Zebra (2) Handymax 38,623 1985 7,500 Sep. 2011
--------- --------- ----- ---------------- ---------
M/V African Oryx (2) Handysize 24,110 1997 7,000 Sep. 2011
--------- --------- ----- ---------------- ---------
M/V BET Commander Capesize 149,507 1991 24,000 Dec. 2011
--------- --------- ----- ---------------- ---------
M/V BET Fighter Capesize 173,149 1992 25,000 Sep. 2011
--------- --------- ----- ---------------- ---------
M/V BET Prince Capesize 163,554 1995 25,000 Jan. 2012
--------- --------- ----- ---------------- ---------
M/V BET Scouter Capesize 171,175 1995 26,000 Oct. 2011
--------- --------- ----- ---------------- ---------
M/V BET Intruder Panamax 69,235 1993 15,500 Sep. 2011
--------- --------- ----- ---------------- ---------
Floating, BHSI
M/V Fiesta (3) Handysize 29,519 1997 linked Nov. 2013
--------- --------- ----- ---------------- ---------
M/V Pacific Fantasy Floating, BHSI
(3) Handysize 29,538 1996 linked Jan. 2014
--------- --------- ----- ---------------- ---------
M/V Pacific Fighter Floating, BHSI
(3) Handysize 29,538 1998 linked Nov. 2013
--------- --------- ----- ---------------- ---------
M/V Clipper Freeway Floating, BHSI
(3) Handysize 29,538 1998 linked Feb. 2014
--------- --------- ----- ---------------- ---------
M/V African Joy (4) Handysize 26,482 1996 14,000 Nov. 2011
--------- --------- ----- ---------------- ---------
M/V African Glory (5) Handysize 24,252 1998 7,000 Nov. 2012
--------- --------- ----- ---------------- ---------
M/V Asian Grace (6) Handysize 20,412 1999 7,000 Sep. 2012
--------- --------- ----- ---------------- ---------
M/V Clipper Glory Handysize 29,982 2007 25,000 Aug. 2012
--------- --------- ----- ---------------- ---------
M/V Clipper Grace Handysize 30,548 2007 25,000 Aug. 2012
--------- --------- ----- ---------------- ---------
Total 1,293,105
--------- --------- ----- ---------------- ---------
(1) Represents profit sharing arrangement at a floor rate of $21,500 per
day and a ceiling of $25,500 per day, with a 50% profit sharing arrangement
to apply to any amount in excess of the ceiling. The spread between floor
and ceiling will accrue 100% to Seanergy. The base used for the calculation
of the rate is the Time Charter Average of the Baltic Panamax Index.
(2) Represents floor charter rates excluding a 50% profit share distributed
equally between the Company and the charterer calculated on the adjusted
Time Charter Average of the Baltic Supramax Index ("BSI").
(3) Time Charter Average of the Baltic Handysize Index increased by 100.63%
minus Opex.
(4) The charterer has the option to extend the time charter agreement for
an additional 11 to 13 months at the same rate.
(5) Represents profit sharing arrangement at a floor rate of $7,000 per day
and a ceiling of $12,000 per day, with a profit sharing arrangement of 75%
for the Company and 25% for the charterer applicable between the $7,000
floor and $12,000 ceiling and, for any amount in excess of the ceiling,
profit sharing of 50% for the Company and 50% for the charterer. The
calculation of the rate will be based on the adjusted Time Charter Average
of the BSI. The two (2) year time charter agreement with a profit sharing
arrangement is an open ended contract with a 6 months mutual notice
following November 2012.
(6) Represents profit sharing arrangement at a floor rate of $7,000 per day
and a ceiling of $11,000 per day, with a profit sharing arrangement of 75%
for the Company and 25% for the charterer applicable between the $7,000
floor and $11,000 ceiling and, for any amount in excess of the ceiling,
profit sharing of 50% for the Company and 50% for the charterer. The
calculation of the rate will be based on the adjusted Time Charter Average
of the BSI. The two (2) year time charter agreement with a profit sharing
arrangement is an open ended contract with a 6 months mutual notice
following September 2012.
During the fourth quarter 2010, we secured time charters for three of our
vessels as follows:
Following the completion of its drydocking, the M/V Bremen Max, a 1993
built and 73,503 dwt Panamax dry bulk carrier, entered into a time charter
trip from Zhousan to the Mediterranean with a charterer we believe to be
first class at a gross charter rate of $10,000 per day. The vessel
commenced its charter on December 1, 2010.
The M/V Davakis G, a 2008 built and 54,051 dwt Supramax dry bulk carrier,
entered into a time charter agreement with a charterer we believe to be
first class, at a charter rate of $10,000 per day. The vessel commenced its
charter on December 6, 2010.
The M/V Delos Ranger, a 2008 built and 54,051 dwt Supramax dry bulk
carrier, entered into a time charter trip from Taiwan to Nigeria with a
charterer we believe to be first class at a charter rate of $8,000 per day.
The vessel commenced its charter on January 7, 2011.
Following these charter arrangements, the Company has secured 79% of its
operating days for 2011, 38% for 2012 and 19% for 2013 under period
employment.
EBITDA Reconciliation:
Seanergy Maritime Holdings Corp.
Reconciliation of Net Income to Adjusted EBITDA
(All amounts expressed in thousands of U.S. Dollars)
Three Months Three Months
Year Ended Year Ended Ended Ended
December 31, December 31, December 31, December 31,
2010 2009 2010 2009
------------- ------------- ------------ ------------
Net income
attributable to
Seanergy Maritime
Holdings 132 30,052 (2,629) (3,213)
------------- ------------- ------------ ------------
Plus: Net income
attributable to
the noncontrolling
interest 1,509 1,517 0 1,584
------------- ------------- ------------ ------------
Plus: Interest and
finance costs, net
(including
interest income) 12,573 7,186 3,843 2,304
------------- ------------- ------------ ------------
Plus: Income taxes 60 0 44 0
------------- ------------- ------------ ------------
Plus: Depreciation
and amortization 32,985 27,857 9,472 6,745
------------- ------------- ------------ ------------
EBITDA 47,259 66,612 10,730 7,420
------------- ------------- ------------ ------------
Plus: Loss (Gain)
on interest rate
swaps 4,164 1,575 (171) 164
------------- ------------- ------------ ------------
Adjusted EBITDA 51,423 68,187 10,559 7,584
------------- ------------- ------------ ------------
Seanergy Maritime Holdings Corp.
Reconciliation of Net Cash Provided by Operating Activities to Adjusted
EBITDA
(All amounts expressed in thousands of U.S. Dollars)
Three Months Three Months
Year Ended Year Ended Ended Ended
December 31, December 31, December 31, December 31,
2010 2009 2010 2009
------------ ------------ ------------ ------------
Net cash flow
provided by
operating
activities 31,537 43,208 5,240 6,763
------------ ------------ ------------ ------------
Changes in
operating assets
and liabilities (2,038) 3,046 (3,100) (3,721)
------------ ------------ ------------ ------------
Fair value of
contracts 319 125 79 84
------------ ------------ ------------ ------------
Change in fair
value of financial
instruments 27 (189) 800 778
------------ ------------ ------------ ------------
Payments for
dry-docking 5,519 7,119 4,012 1,367
------------ ------------ ------------ ------------
Amortization and
write-off of
deferred charges (738) (696) (188) (155)
------------ ------------ ------------ ------------
Interest and
finance costs, net
(includes interest
income) 12,573 7,186 3,843 2,304
------------ ------------ ------------ ------------
Gain from
acquisition of
subsidiary 0 6,813 0 0
------------ ------------ ------------ ------------
Income taxes 60 0 44 0
------------ ------------ ------------ ------------
EBITDA 47,259 66,612 10,730 7,420
------------ ------------ ------------ ------------
Plus: Loss (Gain)
on interest rate
swaps 4,164 1,575 (171) 164
------------ ------------ ------------ ------------
Adjusted EBITDA 51,423 68,187 10,559 7,584
------------ ------------ ------------ ------------
EBITDA consists of earnings before interest and finance cost, taxes,
depreciation and amortization. Adjusted EBITDA consists of earnings before
interest and finance cost, taxes, depreciation and amortization and gain or
losses on interest rate swaps. EBITDA and adjusted EBITDA are not
measurements of financial performance under accounting principles generally
accepted in the United States of America, and do not represent cash flow
from operations. EBITDA and adjusted EBITDA are presented solely as
supplemental disclosures because management believes that they are common
measures of operating performance in the shipping industry.
Subsequent Events:
Drydocking and Maintenance Schedule
The M/V African Zebra's scheduled drydocking commenced on January 4, 2011
and is expected to be completed by the end of February 2011 at a cost of
approximately $1.0 million.
Equity Incentive Plan
On January 12, 2011, the Board adopted the Seanergy Maritime Holdings Corp.
2011 Equity Incentive Plan ("the Plan"). A total of 8,750,000 shares of
our common stock are issuable under the Plan, which is administered by the
Compensation Committee of the Board of Directors. Under the Plan, our
officers, key employees and directors may be granted incentive stock
options, non-qualified stock options, stock appreciation rights, restricted
stock, unrestricted stock, restricted stock units, and unrestricted stock
at the discretion of our Compensation Committee. All share-based payments,
including grants of employee stock options to employees, are recognized as
an expense in the financial statements and such costs are measured at the
fair value of the award. As of December 31, 2010, 2009 and 2008, Seanergy
did not have any share-based payments.
Financial Undertakings
The Company is required to maintain semiannually a minimum equity ratio
requirement of 0.30:1.00 under the Citibank facility agreement relating to
BET. As of December 31, 2010, the Company did not meet this minimum equity
ratio requirement. The Company has requested, and the lender has indicated
its willingness to provide, a reduction to the minimum equity ratio
requirement from 0.30:1.00 to 0.175:1.00 until January 3, 2012. The Company
expects the request to be granted, thus the presentation of the long-term
debt in the attached consolidated financial statements assumes that the
reduction of the minimum equity ratio requirement will be granted, and
accordingly, all of the Company's long-term debt continues to be classified
as non-current as of December 31, 2010. To the extent that the Company is
unable to obtain this reduction, any long-term debt for which the Company
has been unable to receive a reduction on the minimum equity ratio
requirement, will be required to be classified as current, reflecting the
lender's ability to call the debt at any time at its option.
Conference Call Details:
The Company's management team will host a conference call to discuss the
financial results today, Thursday, February 17, 2011 at 10:00 A.M. EST.
Participants should dial into the call 10 minutes before the scheduled time
using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329
(from the UK) or + (44) (0) 1452 542 301 (from outside the US). Please
quote "Seanergy".
A replay of the conference call will be available until February 24, 2011.
The United States 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: 2094507#.
Slides and Audio Webcast:
There will also be a simultaneous live webcast of the conference call over
the Internet, through the Company's website (www.seanergymaritime.com).
Participants desiring to view the live webcast should register on the
website approximately 10 minutes prior to the start of the webcast.
Seanergy Maritime Holdings Corp.
Consolidated Balance Sheets
December 31, 2010 and 2009
(In thousands of US Dollars, except for share data, unless otherwise
stated)
2010
(Unaudited) 2009
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents 53,787 63,607
Restricted cash 10,385 -
Accounts receivable trade, net 999 495
Due from related parties - 265
Inventories 1,459 1,126
Other current assets 1,829 1,980
----------- -----------
Total current assets 68,459 67,473
----------- -----------
Fixed assets
Vessels, net 597,372 444,820
Office equipment, net 29 20
----------- -----------
Total fixed assets 597,401 444,840
----------- -----------
Other assets
Goodwill 17,275 17,275
Deferred charges 13,086 8,684
Other non-current assets 180 180
----------- -----------
TOTAL ASSETS 696,401 538,452
=========== ===========
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt 53,380 33,206
Trade accounts and other payables 2,340 990
Due to underwriters - 19
Due to related parties 4,025 -
Accrued expenses 3,491 1,719
Accrued interest 1,009 1,508
Financial instruments 5,787 3,556
Below market acquired time charters 266 -
Deferred revenue - related party 1,041 894
Deferred revenue 1,452 246
----------- -----------
Total current liabilities 72,791 42,138
----------- -----------
Long-term debt, net of current portion 346,168 267,360
Financial instruments, net of current portion 2,777 1,550
Below market acquired time charters - 585
----------- -----------
Total liabilities 421,736 311,633
----------- -----------
Commitments and contingencies - -
EQUITY
Seanergy shareholders' equity
Preferred stock, $0.0001 par value; 1,000,000
shares authorized; none issued - -
Common stock, $0.0001 par value; 500,000,000
and 200,000,000 authorized shares as at
December 31, 2010 and 2009, respectively;
109,723,980 and 33,255,170 shares issued and
outstanding as at December 31, 2010 and 2009,
respectively 11 3
Additional paid-in capital 279,268 213,232
Accumulated deficit (4,614) (4,746)
----------- -----------
Total Seanergy shareholders' equity 274,665 208,489
----------- -----------
Noncontrolling interest - 18,330
----------- -----------
Total equity 274,665 226,819
----------- -----------
TOTAL LIABILITIES AND EQUITY 696,401 538,452
=========== ===========
Seanergy Maritime Holdings Corp.
Consolidated Statements of Income
For the three months and year end December 31, 2010 and 2009
(In thousands of US Dollars, except for share and per share data, unless
otherwise stated)
Three months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
2010 2009 2010
(Unaudited) (Unaudited) (Unaudited) 2009
----------- ----------- ----------- -----------
Revenues:
Vessel revenue -
related party 8,569 13,791 44,175 83,903
Vessel revenue 18,100 4,023 54,777 6,340
Commissions - related
party (319) (100) (1,546) (2,226)
Commissions (489) (425) (1,550) (120)
----------- ----------- ----------- -----------
Vessel revenue, net 25,861 17,289 95,856 87,897
Expenses:
Direct voyage expenses (1,199) (273) (2,399) (753)
Vessel operating
expenses (10,467) (6,466) (30,667) (16,222)
Voyage expenses -
related party 240 (222) (434) (1,119)
Management fees -
related party (597) (636) (2,328) (1,715)
Management fees (129) - (316) -
General and
administration
expenses (2,985) (1,949) (7,606) (5,928)
General and
administration
expenses - related
party (175) (195) (697) (742)
Amortization of
deferred dry-docking
costs (1,268) (648) (3,657) (1,045)
Depreciation (8,204) (6,097) (29,328) (26,812)
Gain from acquisition
of subsidiary - - - 6,813
----------- ----------- ----------- -----------
Operating income 1,077 803 18,424 40,374
Other income (expense),
net:
Interest and finance
costs (3,883) (2,370) (12,931) (7,230)
Interest and finance
costs - shareholders - - - (386)
Interest income 40 66 358 430
Gain (loss) on
financial
instruments 171 (164) (4,164) (1,575)
Foreign currency
exchange gain
(loss), net 10 36 14 (44)
----------- ----------- ----------- -----------
(3,662) (2,432) (16,723) (8,805)
----------- ----------- ----------- -----------
Net (loss) income
before taxes (2,585) (1,629) 1,701 31,569
----------- ----------- ----------- -----------
Income taxes (44) - (60) -
----------- ----------- ----------- -----------
Net (loss) income (2,629) (1,629) 1,641 31,569
----------- ----------- ----------- -----------
Less: Net (income)
attributable to the
noncontrolling
interest - (1,584) (1,509) (1,517)
----------- ----------- ----------- -----------
Net (loss) income
attributable to
Seanergy Maritime
Holdings Corp.
Shareholders (2,629) (3,213) 132 30,052
=========== =========== =========== ===========
Net (loss) income per
common share
Basic (0.02) (0.10) 0.00 1.16
=========== =========== =========== ===========
Diluted (0.02) (0.10) 0.00 1.00
=========== =========== =========== ===========
Weighted average common
shares outstanding
Basic 109,723,980 33,255,170 87,916,947 25,882,967
=========== =========== =========== ===========
Diluted 109,723,980 33,255,170 87,916,947 30,529,281
=========== =========== =========== ===========
Seanergy Maritime Holdings Corp.
Consolidated Statements of Changes in Equity
For the years ended December 31, 2010, 2009 and 2008
(In thousands of US Dollars, except for share data, unless otherwise
stated)
Retained
Common stock Additional earnings/
------------------------ paid-in (Accumulated
# of Shares Par Value capital deficit)
----------- ----------- ------------ -----------
Balance, December 31,
2007 28,600,000 3 146,925 1,441
----------- ----------- ------------ -----------
Net (loss) for the year
ended December 31,
2008 - - - (31,985)
Dividends paid - - - (4,254)
Reclassification of
common stock no longer
subject to redemption (6,370,773) - 17,144 -
Reversal of underwriter
fees forfeited to
redeeming shareholders - - 1,433 -
Liquidation and
dissolution common
stock exchange - (1) 1 -
Warrants exercised 132,000 - 858 -
----------- ----------- ------------ -----------
Balance, December 31,
2008 22,361,227 2 166,361 (34,798)
----------- ----------- ------------ -----------
Issuance of common
stock to convert
promissory note 6,585,868 1 29,596 -
Issuance of common
stock due to earn-out 4,308,075 - 17,275 -
Gain from acquisition - - - -
Noncontrolling interest
contribution - - - -
Net income for the year
ended December 31,
2009 - - - 30,052
----------- ----------- ------------ -----------
Balance, December 31,
2009 33,255,170 3 213,232 (4,746)
----------- ----------- ------------ -----------
Issuance of common
stock 26,945,000 3 28,523 -
Consolidation with
subsidiaries acquired 49,523,810 5 37,513 -
Net income for the year
ended December 31,
2010 - - - 132
----------- ----------- ------------ -----------
Balance, December 31,
2010 (Unaudited) 109,723,980 11 279,268 (4,614)
=========== =========== ============ ===========
Total
Seanergy Non-
shareholders' controlling Total
equity interest Equity
----------- ----------- -----------
Balance, December 31,
2007 148,369 - 148,369
----------- ----------- -----------
Net (loss) for the year
ended December 31,
2008 (31,985) - (31,985)
Dividends paid (4,254) - (4,254)
Reclassification of
common stock no longer
subject to redemption 17,144 - 17,144
Reversal of underwriter
fees forfeited to
redeeming shareholders 1,433 - 1,433
Liquidation and
dissolution common
stock exchange - - -
Warrants exercised 858 - 858
----------- ----------- -----------
Balance, December 31,
2008 131,565 - 131,565
----------- ----------- -----------
Issuance of common
stock to convert
promissory note 29,597 - 29,597
Issuance of common
stock due to earn-out 17,275 - 17,275
Gain from acquisition - 6,813 6,813
Noncontrolling interest
contribution - 10,000 10,000
Net income for the year
ended December 31,
2009 30,052 1,517 31,569
----------- ----------- -----------
Balance, December 31,
2009 208,489 18,330 226,819
----------- ----------- -----------
Issuance of common
stock 28,526 - 28,526
Consolidation with
subsidiaries acquired 37,518 (19,839) 17,679
Net income for the year
ended December 31,
2010 132 1,509 1,641
----------- ----------- -----------
Balance, December 31,
2010 (Unaudited) 274,665 - 274,665
=========== =========== ===========
SEANERGY MARITIME HOLDINGS CORP.
Consolidated Statements of Cash Flows
For the years ended December 31, 2010, 2009 and 2008
(All amounts in footnotes in thousands of US Dollars, except for share and
per share data)
2010
(Unaudited) 2009 2008
----------- ----------- -----------
Cash flows from operating
activities:
Net income (loss) 1,641 31,569 (31,985)
Adjustments to reconcile net income
to net cash provided by operating
activities:
Impairment of goodwill - - 44,795
Impairment of vessels - - 4,530
Depreciation 29,328 26,812 9,929
Amortization of deferred finance
charges 738 696 224
Amortization of deferred
dry-docking costs 3,657 1,045 -
Payments for dry-docking (5,519) (7,119) -
Change in fair value of financial
instruments (27) 189 -
Amortization of acquired time
charters (319) (125) -
Gain on acquisition - (6,813) -
Changes in operating assets and
liabilities:
(Increase) decrease in operating
assets
Due from related parties 265 1,760 (577)
Inventories (70) 1,222 (872)
Accounts receivable trade, net (493) (263) -
Other current assets 904 (191) (743)
Other non-current assets - (180) -
Increase (decrease) in
operating liabilities
Trade accounts and other
payables 37 (3,299) 86
Due to underwriters (19) (400) (3,555)
Accrued expenses (2,071) (885) 541
Accrued charges on convertible
note due to shareholders - 670 132
Due to related parties 4,025 - -
Premium amortization on
convertible note due to
shareholders - (379) -
Accrued interest (1,002) 1,176 166
Deferred revenue - related party 148 (2,523) 3,029
Deferred revenue 314 246 -
----------- ----------- -----------
Net cash provided by operating
activities 31,537 43,208 25,700
----------- ----------- -----------
Cash flows from investing
activities:
Acquisition of business, including
of cash acquired 17,913 36,374 (375,833)
Funds placed in trust account from
offerings - - 232,923
Additions to vessels - - -
Additions to office furniture and
equipment (28) (21) (9)
Acquisition of noncontrolling
interest (10,000) - -
----------- ----------- -----------
Net cash provided by (used in)
investing activities 7,885 36,353 (142,919)
----------- ----------- -----------
Cash flows from financing
activities:
Redemption of common shares - - (63,705)
Proceeds from warrants exercised - - 858
Proceeds from long term debt and
revolving facility - - 219,845
Deemed distribution upon acquisition
of MCS (2,054) - -
Net proceeds from issuance of common
stock 28,526 - -
Repayments of long term debt (67,941) (54,878) (7,500)
Dividends paid - - (4,254)
Deferred finance charges (841) - (2,693)
Noncontrolling interest contribution - 10,000 -
Restricted cash (retained) released (6,932) 1,381 -
----------- ----------- -----------
Net cash (used in) provided by
financing activities (49,242) (43,497) 142,551
----------- ----------- -----------
Net (decrease) increase in cash and
cash equivalents (9,820) 36,064 25,332
Cash and cash equivalents at
beginning of period 63,607 27,543 2,211
----------- ----------- -----------
Cash and cash equivalents at end of
period 53,787 63,607 27,543
=========== =========== ===========
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest 11,070 6,447 3,402
Non cash investing and financing
activities
Issuance of common shares at fair
value for the acquisition of BET 30,952 - -
Issuance of common shares at fair
value for the acquisition of MCS 26,743 - -
Deemed distribution to controlling
shareholder (10) - -
About Seanergy Maritime Holdings Corp.
Seanergy Maritime Holdings Corp., the successor to Seanergy Maritime Corp.,
is a Marshall Islands corporation with its executive offices in Athens,
Greece. The Company is engaged in the transportation of dry bulk cargoes
through the ownership and operation of dry bulk carriers.
The Company's initial fleet comprised two Panamax, two Supramax, one
Handymax and one Handysize dry bulk carriers that Seanergy purchased and
took delivery of in the third quarter of 2008 from companies associated
with members of the Restis family. In August 2009, the Company acquired a
controlling interest in BET, which owns four Capesize and one Panamax dry
bulk carriers. In May 2010, the Company acquired a controlling interest in
MCS, which owns nine Handysize dry bulk carriers. In September 2010, the
Company completed the acquisition of the remaining 49% in MCS, and in
October 2010 the Company completed the acquisition of the remaining 50% in
BET.
Following the MCS and BET acquisitions, the Company has a wholly-owned
operating fleet of 20 drybulk carriers (four Capesize, three Panamax, two
Supramax, one Handymax and ten Handysize vessels) with a total carrying
capacity of approximately 1,293,105 dwt and an average fleet age of 13
years.
The Company's common stock and warrants trade on the NASDAQ Global Market
under the symbols "SHIP" and "SHIP.W", respectively.
Forward-Looking Statements
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.
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 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, which 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, the scope and
timing of Securities and Exchange Commission ("SEC") and other regulatory
agency review, 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
SEC. The Company's filings can be obtained free of charge on the SEC's
website at www.sec.gov. 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.
Contact Information: For further information please contact: Seanergy Maritime Holdings Corp. Dale Ploughman Chief Executive Officer Christina Anagnostara Chief Financial Officer Tel: +30 210 9638461 E-mail: ir@seanergymaritime.com Investor Relations / Media Capital Link, Inc. Paul Lampoutis 230 Park Avenue Suite 1536 New York, NY 10169 Tel: (212) 661-7566 E-mail: seanergy@capitallink.com