MONACO — (Marketwired) — 03/04/15 — Scorpio Bulkers Inc. (NYSE: SALT) (“Scorpio Bulkers,” or the “Company”) today reported its results for the three months and year ended December 31, 2014. The Company had minimal operations from the period from March 20, 2013 (date of inception) to December 31, 2013.
Results for the three months and year ended December 31, 2014
For the three months ended December 31, 2014, the Company had a net loss of $72.0 million, or $0.48 basic and diluted loss per share. This loss includes the loss on disposal of assets of $55.5 million and the noncash amortization of stock-based compensation of $6.3 million. The Company’s adjusted net loss was $16.5 million (see Non-GAAP Measures section below), or $0.11 basic and diluted loss per share, which excludes a loss on disposal of assets of $55.5 million, or $0.37 loss per share.
For the year ended December 31, 2014, the Company had a net loss of $116.6 million, or $0.85 basic and diluted loss per share. This loss includes the loss on disposal of assets of $55.5 million and the noncash amortization of stock-based compensation of $23.9 million. The Company’s adjusted net loss was $61.1 million (see Non-GAAP Measures section below), or $0.45 basic and diluted loss per share, which excludes a loss on disposal of assets of $55.5 million, or $0.40 loss per share.
The Company had minimal operations during the period from March 20, 2013 (date of inception) to December 31, 2013 so the prior year periods are not comparable to results for the three months and year ended December 31, 2014.
Explanation of Components of Financial Results for the Fourth Quarter of 2014 and 2013
For the three months ended December 31, 2014, the Company recorded a net loss of $72.0 million. The Company recorded a net loss of $3.6 million for the three months ended December 31, 2013.
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 $17.6 million for the three months ended December 31, 2014, associated with 22 vessels time chartered-in and two vessel owned, for which TCE revenue per day was $8,660 (see the breakdown of daily TCE averages below). Time charter equivalent revenue per day was adversely affected by a depressed rate environment for dry bulk carriers.
Vessel operating costs for the three months ended December 31, 2014 were $1.2 million related to two Kamsarmax vessels delivered to the Company from a shipyard in August and September 2014.
Charterhire expense was $23.7 million for the three months ended December 31, 2014 relating to the time chartered-in vessels including those described below. See the Company’s Fleet List below for the terms of these agreements.
Depreciation for the three months ended December 31, 2014 was $0.6 million and relates to two owned Kamsarmax vessels.
During the three months ended December 31, 2014 the Company recorded a loss of $55.5 million associated with writing down seven contracts to construct vessels that the Company has classified as held for sale as of December 31, 2014. These seven contracts to construct vessels include one Kamsarmax construction contract and six contracts for construction of LR2 product tankers (see recent significant events, below).
General and administrative expense was $8.5 million for the three months ended December 31, 2014. Such amount included $6.3 million of restricted stock amortization (noncash) and the balance primarily related to payroll, directors’ fees, professional fees and insurance. General and administrative expense was $4.8 million for the three months ended December 31, 2013, which includes $3.4 million of restricted stock amortization.
During the three months ended December 31, 2013, the Company recorded a $0.9 million gain in connection with a shareholder receivable denominated in Norwegian kroner that arose in September 2013 but was not settled in U.S. dollars until October 2013.
Explanation of Components of Financial Results for the Year Ended December 31, 2014 and the Period From March 20, 2013 (Date of Inception) to December 31, 2013
For the year ended December 31, 2014, the Company recorded a net loss of $116.6 million and recorded a net loss of $6.3 million during the period from March 20, 2013 (date of inception) to December 31, 2013.
TCE revenue was $45.4 million for the year ended December 31, 2014, associated with 24 vessels time chartered-in and two vessels owned, for which the time charter equivalent revenue per day was $7,957 (see the breakdown of daily TCE averages below). Time charter equivalent revenue per day was adversely affected by the integration of the time chartered vessels into our fleet which required significant time and fuel as they had to be repositioned for their first voyages as well as a depressed rate environment for dry bulk carriers.
Vessel operating costs for the year ended December 31, 2014 was $1.6 million related to two owned Kamsarmax vessels delivered to the Company from a shipyard in August and September 2014.
Charterhire expense was $73.2 million for the year ended December 31, 2014 relating to the time chartered-in vessels including those described below. See the Company’s Fleet List below for the terms of these agreements.
Depreciation for the year ended December 31, 2014 was $0.7 million and relates to two Kamsarmax vessels delivered to the Company from a shipyard in August and September 2014.
During the year ended December 31, 2014 the Company recorded a loss of $55.5 million associated with writing down seven contracts to construct vessels that the Company has classified as held for sale as of December 31, 2014. These seven contracts to construct vessels include one Kamsarmax construction contract and six contracts for construction of LR2 product tankers (see recent significant events, below).
General and administrative expense was $31.9 million for the year ended December 31, 2014. Such amount included $23.9 million of restricted stock amortization (noncash) and the balance primarily related to payroll, directors’ fees, professional fees and insurance. General and administrative expense was $5.5 million for the period from March 20, 2013 (date of inception) to December 31, 2013. Such amount included $3.4 million of restricted stock amortization (noncash) and the balance primarily related to payroll, directors’ fees, professional fees and insurance.
During the period from March 20, 2013 (date of inception) to December 31, 2013, the Company incurred a $1.1 million loss in connection with a shareholder receivable denominated in Norwegian kroner that arose in September 2013 but was not settled in U.S. dollars until October 2013.
Recent Significant Events
Agreements to Modify and Sell Existing Shipbuilding Contracts for Six Capesize Vessels
On December 17, 2014, the Company announced that it had (i) reached agreements with shipyards in South Korea and Romania to modify six newbuilding contracts for Capesize bulk carriers into newbuilding contracts for LR2 product tankers, (ii) reached an agreement to sell four of these LR2 newbuilding contracts to Scorpio Tankers Inc., a related party, and (iii) granted options to Scorpio Tankers Inc. to purchase the two remaining LR2 newbuilding contracts.
The sale price for each of the four LR2 newbuilding contracts is $51.0 million. The two option contracts, which expire on May 31, 2015, may be exercised by Scorpio Tankers Inc. for a fixed purchase price of $52.5 million for each contract.
Agreement to Sell Kamsarmax Newbuilding
On December 19, 2014, the Company announced that it had entered into an agreement to sell a Kamsarmax newbuilding dry bulk vessel for approximately $30.7 million. The vessel is currently being constructed at Tsuneishi Group (Zhoushan) Shipbuilding Inc., and has an expected delivery date in the third quarter of 2015.
Agreements to Modify Existing Shipbuilding Contracts for Three Capesize Vessels
On February 4, 2015, the Company announced that it had reached agreement with a shipyard in South Korea to modify existing newbuilding contracts for three Capesize vessels. The three contracts, two for vessels scheduled for delivery during the first quarter of 2016 and one for a vessel scheduled for delivery during the second quarter of 2016, will now provide for the construction of three LR1 product tankers, two of which will be scheduled for delivery during the second quarter of 2017 and one during the third quarter of 2017. As a result, the Company expects to incur a loss of approximately $22 million relating to writing down the contracts to their estimated fair market value. Also, upon completion of customary documentation, the LR1 contracts will be re-classified on the balance sheet as assets held for sale. Should the contracts be sold for their current fair market value, the estimated future cash obligations of the Company will be reduced by approximately $60 million. The Company has no plans for any further contract conversions. Scorpio Tankers Inc., has informed the Company that it will not purchase the LR1 vessels.
$409 Million Credit Facility
On December 30, 2014, the Company closed a $408.976 million senior secured credit facility arranged by two leading European financial institutions to finance a portion of the purchase price of 20 vessels (six Ultramax, nine Kamsarmax, and five Capesize vessels) with expected deliveries in 2015 and 2016. The facility was previously announced as a $540 million credit facility; however, the facility was reduced to $408.976 million due to the removal of the financing on the four Capesize vessels that the Company has agreed to convert into four LR2 product tankers (of which the Company will sell two LR2 product tankers to Scorpio Tankers Inc. and hold two LR2 product tankers for sale). The facility has a final maturity of six years from the date of signing.
$411.3 Million Credit Facility
On January 15, 2015, the Company closed a previously announced $411.264 million senior secured credit facility with a group of financial institutions to finance a portion of the purchase price of 12 Capesize vessels under construction at Sungdong Shipbuilding & Marine Engineering Co., Ltd. The facility matures in six years, and in certain circumstances up to 12 years, from the delivery of the final vessel securing the facility.
$42 Million Credit Facility
On January 30, 2015, the Company announced that it had closed a previously announced $42 million credit facility with a leading European financial institution to finance a portion of the purchase price of two Kamsarmax vessels (of which one Kamsarmax vessel was delivered in January 2015 to the Company from Imabari Shipbuilding Co. Ltd., Japan and one Kamsarmax vessel is under construction at Imabari Shipbuilding Co. Ltd., Japan). The facility may be drawn in two tranches, each of which has a final maturity of six years from the date of the respective vessel delivery from the yard.
$26 Million Credit Facility
On February 27, 2015, the Company closed a senior secured credit facility of $26 million with ABN AMRO Bank N.V., The Netherlands. The facility has been used to finance a portion of the purchase price of one Capesize vessel, which was delivered to the Company in Q1 2015. The facility shall mature at the earlier of (a) the date falling six months after the drawdown date; and (b) the date ten business days after the date on which the Chinese Ministry of Finance has approved insurance coverage to be provided by the China Export & Credit Insurance Corporation (“Sinosure”) in respect of the $230.3 Million Credit Facility discussed below and drawings can be made under such facility. The terms and conditions of the facility, including covenants, are similar to those in the Company’s existing credit facilities and customary for financings of this type.
$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 previously announced as a $39.6 million credit facility, that has now been reduced to a size of $19.8 million due to the removal from the financing of one Kamsarmax vessel which we have classified as held for sale. The facility was arranged by ABN AMRO Bank N.V., The Netherlands, with insurance cover provided from the China Export & Credit Insurance Corporation (“Sinosure”). The facility will 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. The facility shall mature 10 years from the date of delivery of the vessel. The terms and conditions of the facility, including covenants, are similar to those in the Company’s existing credit facilities and customary for financings of this type.
$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 commitment finalizes a previously announced memorandum of understanding for a $234.9 million credit facility. This facility was arranged by ABN AMRO Bank N.V., The Netherlands, with insurance cover to be provided from the China Export & Credit Insurance Corporation (“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. This facility is subject to customary conditions precedent and the execution of definitive documentation.
Update on Fleet Financing
Including the five credit facilities described above (excluding the $26 million Credit Facility), the Company has now either signed credit facility agreements for or received commitments for 70 of the vessels in its fleet, including five vessels which the Company intends to sell. In addition, the Company has agreed terms and conditions with a leading European financial institution to finance a portion of the cost of our additional five unfinanced vessels. The terms and conditions of these facilities, for which commitments are expected during the first half 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.
Newbuilding Vessels Deliveries
Through March 2, 2015 the Company has taken delivery of the following Newbuilding vessels during 2015:
- SBI Bravo, an Ultramax vessel, was delivered from Nantong COSCO KHI Ship Engineering Co., Ltd.
- SBI Athena, an Ultramax vessel, was delivered from Chengxi Shipyard Co., Ltd.
- SBI Samba, a Kamsarmax vessel, was delivered from Imabari Shipbuilding Co. Ltd.
- SBI Antares, an Ultramax vessel, was delivered from Nantong COSCO KHI Ship Engineering Co., Ltd.
- SBI Puro, a Capesize vessel, was delivered from Shanghai Waigaoqiao Shipbuilding Co., Ltd. The Company has agreed to time charter-out the SBI Puro to a major European charterer for 10-13 months at $13,800 per day.
- SBI Leo, an Ultramax vessel, was delivered from Dalian COSCO KHI Ship Engineering Co. Ltd.
Current Liquidity
As of March 2, 2015, the Company had $182.1 million in cash and cash equivalents.
Debt
We made the following drawdowns from our credit facilities in November 2014:
Drawdown amount
Credit facility ($ thousands) Collateral
---------------------------------- ---------------- ------------------
1 $39.6 Million Facility $ 16,775 SBI Cakewalk
2 $39.6 Million Facility 16,775 SBI Charleston
As of March 2, 2015, the Company’s outstanding debt balance, and amount available to draw is as follows:
As of
December 31,
2014 As of March 2, 2015
------------- ---------------------------
Amount Amount Amount
outstanding outstanding available
------------- ------------- -------------
Senior Notes $ 73,625$ 73,625 $ --
$39.6 Million Credit Facility (1) 33,550 33,550 --
$408.976 Million Credit Facility
(2) -- 14,988 393,988
$330 Million Credit Facility (1) -- 45,000 285,000
$42 Million Credit Facility (2) -- 20,400 21,000
$19.8 Million Credit Facility (2) -- -- 19,800
$67.5 Million Credit Facility (1) -- -- 67,500
$411.264 Million Credit Facility
(3) -- -- 411,264
$230.3 Million Credit Facility (4) -- -- 230,325
$26 Million Credit Facility (5) -- 26,000 --
------------- ------------- -------------
Total $ 107,175$ 213,563$ 1,428,877
============= ============= =============
(1) As most recently described in our press release dated July 30, 2014.
(2) As described above in this press release.
(3) As described above in this press release. This total commitment for 12
Capesize vessels will be reduced by five Capesize vessels, two of which
the Company has agreed to convert to LR2 product tankers under
construction which are to be sold to Scorpio Tankers Inc. and three of
which the Company has agreed to convert to LR1 product tankers under
construction.
(4) As described in our press release dated December 5, 2014 and above in
this press release.
(5) As described above in this press release. 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.
Newbuilding Program
Our Newbuilding Program consists of contracts for the construction of 70 dry bulk vessels, comprised of 29 Ultramax newbuildings, 22 Kamsarmax newbuilding and 19 Capesize newbuildings. Through December 31, 2014, we have taken delivery of two Kamsarmax vessels. The aggregate construction price for the remaining 68 drybulk vessels is $2,496.9 million. As of March 2, 2015, we have paid a total of $946.6 million in installment payments due under these shipbuilding contracts including for those vessels delivered to us in 2015. The remaining $1,550.3 million 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):
Q1 2015 $ 30.6 million(2)
Q2 2015 201.6
Q3 2015 469.4
Q4 2015 270.7
Q1 2016 281.6
Q2 2016 236.4
Q3 2016 60.0
----------------
$ 1,550.3 million
================
(1) These are estimates only and are subject to change as construction
progresses.
(2) Relates to payments expected to be made from March 2, 2015 to March 31,
2015.
Vessels Under Construction To Be Sold
We also have contracts for ten vessels which we intend to sell, consisting of one Kamsarmax vessel under construction, six LR2 product tankers under construction (which were previously Capesize vessels under construction) and three Capesize vessels under construction to be converted to LR1 product tankers under construction. Through March 2, 2015, we have paid $171.5 million under these contracts, including payments made on the nine Capesize vessels under construction prior to their modification. These ten contracts, including the nine contracts for product tankers, have an aggregate construction price of $527.8 million of which $369.1 million has not been paid as of March 2, 2015. Until these contracts are sold, the remaining installment payments under the terms of these contracts are estimated to be payable as follows (1):
Q1 2015 $ -- million(2)
Q2 2015 --
Q3 2015 53.9
Q4 2015 24.8
Q1 2016 57.6
Q2 2016 25.4
Q3 2016 75.7
Q4 2016 38.4
Q1 2017 27.4
Q2 2017 44.4
Q3 2017 21.5
----------------
$ 369.1 million
================
(1) These are estimates only and are subject to change as construction
progresses.
(2) Relates to payments expected to be made from March 2, 2015 to March 31,
2015.
Conference Call Details:
Wednesday, March 4, 2015 and will host a conference call later in the day at 11:30 AM Eastern Standard Time and 5:30 PM Central European Time.
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (800)-236-9788 (U.S.) or 1 (913)-312-0975 (International). The conference participant passcode is 3379110. 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.
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=101761
Scorpio Bulkers Inc. and Subsidiaries
Consolidated Statements of Operations (unaudited)
(Dollars in Thousands, Except Per Share Data)
Period from
March 20,
Three Months Three Months For the year 2013 (date of
Ended Ended Ended inception) to
December 31, December 31, December 31, December 31,
2014 2013 2014 2013
------------ ------------ ------------ -------------
Revenue:
Vessel revenue $ 17,732 $ -- $ 48,987 $ --
------------ ------------ ------------ -------------
Operating expenses:
Voyage expenses 161 -- 3,579 --
Vessel operating
costs 1,218 -- 1,600 --
Charterhire
expense 23,746 -- 73,214 --
Vessel
depreciation 569 -- 686 --
Loss on disposal
of assets 55,487 -- 55,487 --
General and
administrative
expenses 8,524 4,829 31,909 5,505
------------ ------------ ------------ -------------
Total operating
expenses 89,705 4,829 166,475 5,505
------------ ------------ ------------ -------------
Operating loss (71,973) (4,829) (117,488) (5,505)
------------ ------------ ------------ -------------
Other income
(expense):
Interest income 130 323 1,052 341
Foreign exchange
gain (loss) 43 945 43 (1,135)
Other expense, net (198) (8) (172) (8)
------------ ------------ ------------ -------------
Total other income
(expense) (25) 1,260 923 (802)
------------ ------------ ------------ -------------
Net loss $ (71,998)$ (3,569)$ (116,565)$ (6,307)
============ ============ ============ =============
Loss per common
share- basic and
diluted (1) $ (0.48)$ (0.04)$ (0.85)$ (0.16)
Weighted-average
shares outstanding-
basic and diluted
(1) 151,119,957 91,023,403 137,592,861 39,925,160
(1) Diluted weighted-average shares outstanding, which would include the
impact of restricted shares, for the three months ended December 31,
2014 and 2013, for the year ended December 31, 2014 and for the period
from March 20, 2013 (date of inception) to December 31, 2013, 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)
December 31,
2014 2013
------------ ------------
Current assets
Cash and cash equivalents $ 272,673$ 733,896
Due from charterers 12,411 --
Due from related party 31,277 --
Prepaid expenses and other current assets 2,557 61
Assets held for sale 43,781 --
------------ ------------
Total current assets 362,699 733,957
------------ ------------
Non-current assets
Vessels, net 66,633 --
Vessels under construction 866,844 371,692
Deferred financing costs, net 3,181 --
Other assets 24,848 35
------------ ------------
Total non-current assets 961,506 371,727
------------ ------------
Total assets $ 1,324,205$ 1,105,684
============ ============
Liabilities and shareholders' equity
Current liabilities
Bank loans $ 3,300 $ --
Accounts payable and accrued expenses 17,042 1,472
------------ ------------
Total current liabilities 20,342 1,472
------------ ------------
Non-current liabilities
Bank loans 30,250 --
Senior Notes 73,625 --
------------ ------------
Total non-current liabilities 103,875 --
------------ ------------
Total liabilities 124,217 1,472
------------ ------------
Shareholders' equity
Common stock, $0.01 par value per share;
authorized 450,000,000 shares; issued and
outstanding 180,299,695 and 133,403,931 shares
as of December 31, 2014 and December 31, 2013,
respectively 1,803 1,334
Paid-in capital 1,321,057 1,109,185
Accumulated deficit (122,872) (6,307)
------------ ------------
Total shareholders' equity 1,199,988 1,104,212
------------ ------------
Total liabilities and shareholders' equity $ 1,324,205$ 1,105,684
============ ============
Scorpio Bulkers Inc. and Subsidiaries
Statements of Cash Flows (unaudited)
(Dollars in Thousands)
Period from
March 20,
For the year 2013 (date of
ended inception) to
December 31, December 31,
2014 2013
------------ -------------
Operating activities
Net loss $ (116,565)$ (6,307)
Adjustment to reconcile net loss to net cash
used by operating activities:
Restricted stock amortization 23,869 3,359
Amortization of deferred financing costs 150 --
Vessel depreciation 686 --
Loss on disposal of assets 55,487 --
Changes in operating assets and liabilities:
Increase in amounts due from charterers (17,716) (35)
Increase in prepaid expenses and other current
assets (2,496) (61)
Increase in accounts payable and accrued
expenses 6,245 807
------------ -------------
Net cash used in operating activities (50,340) (2,237)
------------ -------------
Investing activities
Security deposit paid on assets held for sale (31,277) --
Payments for vessels and vessels under
construction (651,505) (371,692)
------------ -------------
Net cash used in investing activities (682,782) (371,692)
------------ -------------
Financing activities
Proceeds from issuance of common stock 187,615 1,107,825
Proceeds from bank loans 33,550 --
Proceeds from Senior Notes offering 73,625 --
Debt issue costs paid (22,891) --
------------ -------------
Net cash provided by financing activities 271,899 1,107,825
------------ -------------
(Decrease) increase in cash and cash equivalents (461,223) 733,896
Cash at cash equivalents, beginning of period 733,896 --
------------ -------------
Cash and cash equivalents, end of year $ 272,673$ 733,896
============ =============
Scorpio Bulkers Inc. and Subsidiaries
Other Operating Data (unaudited)
(Dollars in Thousands, Except Per Day Data)
Period from
March 20,
Three Months Three Months For the Year 2013 (date of
Ended Ended Ended inception) to
December 31, December 31, December 31, December 31,
2014 2013 2014 2013
------------ ------------ ------------ -------------
Time Charter Equivalent
Revenue (1):
Vessel revenue $ 17,732 $ -- $ 48,987 $ --
Voyage expenses 161 -- 3,579 --
------------ ------------ ------------ -------------
Time charter
equivalent revenue $ 17,571 $ -- $ 45,408 $ --
============ ============ ============ =============
Time charter equivalent
revenue attributable
to:
Kamsarmax $ 13,779 $ -- $ 32,265 $ --
Ultramax 3,792 -- 10,143 --
------------ ------------ ------------ -------------
$ 17,571 $ -- $ 42,408 $ --
============ ============ ============ =============
Revenue days (1):
Kamsarmax 1,570 -- 4,527 --
Ultramax 459 -- 1,180 --
------------ ------------ ------------ -------------
Combined 2,029 -- 5,707 --
============ ============ ============ =============
TCE per revenue day (1):
Kamsarmax $ 8,777 $ -- $ 7,790 $ --
Ultramax $ 8,261 $ -- $ 8,599 $ --
Combined $ 8,660 $ -- $ 7,957 $ --
(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 March 2, 2015
Newbuilding Program
Owned vessels
Vessel Name Year Built DWT Vessel Type
-------------------------------- ------------- ---------- ------------------
SBI Puro 2015 180,000 Capesize
----------
Total Capesize 180,000
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
----------
Total Ultramax 247,000
----------
Total Owned Vessels DWT 675,000
==========
Vessels under construction
Capesize
Expected
Vessel Name Delivery (1) DWT Shipyard
1 Hull H1310 - TBN SBI Valrico Q3-15 180,000 Waigaoqiao
2 Hull H1311 - TBN SBI Maduro Q4-15 180,000 Waigaoqiao
3 Hull H1364 - TBN SBI Belicoso Q3-15 180,000 Waigaoqiao
4 Hull H1365 - TBN SBI Corona Q1-16 180,000 Waigaoqiao
5 Hull H1366 - TBN SBI Diadema Q1-16 180,000 Waigaoqiao
6 Hull H1367 - TBN SBI Estupendo Q2-16 180,000 Waigaoqiao
7 Hull S1205 - TBN SBI Camacho Q2-15 180,000 Sungdong
8 Hull S1206 - TBN SBI Montesino Q2-15 180,000 Sungdong
9 Hull S1211 - TBN SBI Magnum Q2-15 180,000 Sungdong
10 Hull S1212 - TBN SBI Montecristo Q3-15 180,000 Sungdong
11 Hull S1213 - TBN SBI Aroma Q3-15 180,000 Sungdong
12 Hull S1214 - TBN SBI Cohiba Q4-15 180,000 Sungdong
13 Hull S1215 - TBN SBI Habano Q1-16 180,000 Sungdong
14 Hull H1059 - TBN SBI Churchill Q4-15 180,000 Daewoo
15 Hull H1060 - TBN SBI Perfecto Q1-16 180,000 Daewoo
16 Hull H1061 - TBN SBI Presidente Q2-16 180,000 Daewoo
17 Hull HN1058 - TBN SBI Behike Q4-15 180,000 Daehan
18 Hull HN1059 - TBN SBI Monterrey Q4-15 180,000 Daehan
----------
Capesize NB DWT 3,240,000
----------
Kamsarmax
Expected
Vessel Name 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 Q3-15 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 SS179 - TBN SBI Merengue Q1-16 81,600 Tsuneishi
7 Hull S1228 - TBN SBI Capoeira Q2-15 82,000 Hudong
8 Hull S1722A - TBN SBI Conga Q2-15 82,000 Hudong
9 Hull S1723A - TBN SBI Bolero Q3-15 82,000 Hudong
10 Hull S1229 - TBN SBI Carioca Q3-15 82,000 Hudong
11 Hull S1724A - TBN SBI Sousta Q3-15 82,000 Hudong
12 Hull S1725A - TBN SBI Reggae Q4-15 82,000 Hudong
13 Hull S1726A - TBN SBI Zumba Q1-16 82,000 Hudong
14 Hull S1231 - TBN SBI Macarena Q1-16 82,000 Hudong
15 Hull S1735A - TBN SBI Parapara Q2-16 82,000 Hudong
16 Hull S1736A - TBN SBI Mazurka Q2-16 82,000 Hudong
17 Hull S1230 - TBN SBI Lambada Q3-15 82,000 Hudong
18 Hull S1232 - TBN SBI Swing Q2-16 82,000 Hudong
19 Hull S1233 - TBN SBI Jive Q3-16 82,000 Hudong
-------------
Kamsarmax NB DWT 1,559,600
-------------
Ultramax
Expected
Vessel Name 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 S870 - TBN SBI Echo Q3-15 61,000 Imabari
6 Hull S871 - TBN SBI Tango Q3-15 61,000 Imabari
7 Hull S-A098 - TBN SBI Achilles Q4-15 61,000 Imabari
8 Hull S-A089 - TBN SBI Cronos Q4-15 61,000 Imabari
9 Hull S-A090 - TBN SBI Hermes Q1-16 61,000 Imabari
10 Hull NE182 - TBN SBI Maia Q3-15 61,000 Nacks
11 Hull NE183 - TBN SBI Hydra Q3-15 61,000 Nacks
12 Hull NE194 - TBN SBI Hyperion Q2-16 61,000 Nacks
13 Hull NE195 - TBN SBI Tethys Q2-16 61,000 Nacks
14 Hull DE019 - TBN SBI Lyra Q2-15 61,000 Dacks
15 Hull DE020 - TBN SBI Subaru Q2-15 61,000 Dacks
16 Hull DE021 - TBN SBI Ursa Q3-15 61,000 Dacks
17 Hull CX0651 - TBN SBI Pegasus Q3-15 64,000 Dacks
18 Hull CX0652 - TBN SBI Orion Q4-15 64,000 Chengxi
19 Hull CX0612 - TBN SBI Thalia Q4-15 64,000 Chengxi
20 Hull CX0653 - TBN SBI Hercules Q4-15 64,000 Chengxi
21 Hull CX0627 - TBN SBI Perseus Q1-16 64,000 Chengxi
22 Hull CX0654 - TBN SBI Kratos Q1-16 64,000 Chengxi
23 Hull CX0655 - TBN SBI Samson Q2-16 64,000 Chengxi
24 Hull CX0613 - TBN SBI Phoebe Q3-16 64,000 Chengxi
25 Hull CX0656 - TBN SBI Phoenix Q3-16 64,000 Chengxi
-------------
Ultramax NB DWT 1,548,800
-------------
Total Newbuild DWT 6,348,400
=============
Vessels to be Sold
Expected
Vessel Name Delivery(1) DWT Shipyard
1 Hull S3120 - TBN SBI Parejo Q3-16 115,000 Sungdong
2 Hull S3121 - TBN SBI Tuscamina Q3-16 115,000 Sungdong
3 Hull H5023 - TBN SBI Panatela Q4-16 112,000 Daewoo
4 Hull H5024 - TBN SBI Robusto Q1-17 112,000 Daewoo
5 Hull H.5003 - TBN SBI Macanudo Q1-16 115,000 Daehan
6 Hull H.5004 - TBN SBI Cuaba Q2-16 115,000 Daehan
-------------
Total LR2 NB DWT 684,000
1 Hull S3122 - TBN SBI Lonsdale Q2-17 74,500 Sungdong
2 Hull S3123 - TBN SBI Partagas Q2-17 74,500 Sungdong
3 Hull S3124 - TBN SBI Toro Q3-17 74,500 Sungdong
-------------
Total LR1 NB DWT 223,500
-------------
Total Product Tankers NB DWT 907,500
-------------
Kamsarmax Held for Sale
1 Hull SS164 - TBN SBI Salsa Q3-15 81,600 Tsuneishi
-------------
Total Kamsarmax NB DWT 81,600
-------------
Total Vessels Held for Sale DWT 989,100
=============
As used in this earnings release “Dacks” refers to Dalian COSCO KHI Ship Engineering Co. Ltd., “Daehan” refers to Daehan Shipbuilding Co., Ltd., “Daewoo” refers to Daewoo Mangalia Heavy Industries S.A.,”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 quarter during which each vessel is
currently expected to be delivered from the shipyard.
Time chartered-in vessels
The Company has time chartered-in 14 dry bulk vessels. The terms of the time charter-in contracts are summarized as follows:
Daily Base
Vessel Type Year Built DWT Where Built Rate Earliest Expiry
------------- ---------- ---------- ----------- ----------- ----------------
Post-Panamax 2012 98,700 China $ 13,000 15-Oct-16 (1)
Post-Panamax 2009 93,000 China See Note (2) 09-May-15 (2)
Post-Panamax 2011 93,000 China $ 9,500 11-Aug-15 (3)
Kamsarmax 2014 82,500 South Korea $ 12,000 23-Jul-15 (4)
Kamsarmax 2012 82,000 South Korea $ 15,500 23-Jul-17 (5)
Kamsarmax 2011 81,900 South Korea $ 12,750 03-Apr-15 (6)
Kamsarmax 2011 81,500 South Korea $ 15,000 15-Jan-16 (7)
Panamax 2004 77,500 China $ 14,000 03-Jan-17 (8)
Panamax 2014 76,000 China See Note (9) 19-Jun-15 (9)
Ultramax 2010 61,000 Japan $ 14,200 01-Apr-17 (10)
Supramax 2010 58,000 China $ 14,250 12-Dec-15 (11)
Supramax 2008 58,000 China $ 12,250 13-Jun-16 (12)
Supramax 2015 55,000 Japan $ 14,000 27-Jan-18 (13)
Handymax 2002 48,500 Japan $ 12,000 31-Jan-17 (14)
----------
Total TC DWT 1,046,600
==========
(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 11 to 14 months at the
Company's option at $12,000 per day. The Company has the option to
extend this time charter for one year. The vessel was delivered on
August 22, 2014.
(5) 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.
(6) This vessel has been time chartered-in for 11 to 13 months at the
Company's option at $12,750 per day. The Company has the option to
extend this time charter for one year at $13,750 per day. The vessel was
delivered on May 3, 2014.
(7) 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
(8) 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.
(9) This vessel has been time chartered-in for 10 to 13 months at Company's
option at $5,000 per day for the first 40 days and $10,000 thereafter,
per day. The Company has the option to extend the charter for an
additional year. The vessel was delivered on August 10, 2014.
(10)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.
(11)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.
(12)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.
(13)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.
(14)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.
About Scorpio Bulkers Inc.
Scorpio Bulkers Inc. is a provider of marine transportation of dry bulk commodities. Scorpio Bulkers Inc. currently owns eight vessels, consisting of one Capesize, three Kamsarmax vessels and four Ultramax vessels. The Company also time charters-in 14 dry bulk vessels (consisting of one Handymax, one Ultramax, three Supramax, two Panamax, four Kamsarmax and three Post-Panamax vessels) and has contracted for 63 dry bulk vessels consisting of 25 Ultramax, 20 Kamsarmax (including one vessel held for sale) and 18 Capesize vessels, from shipyards in Japan, South Korea, China and Romania. The Company has also contracted for nine product tankers that are currently classified as held for sale, including six LR2’s and three LR1’s from shipyards in South Korea and Romania. Upon final delivery of all of the vessels the owned fleet is expected to have a total carrying capacity of approximately 7.0 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.
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.
Non-GAAP Measures
This press release describes adjusted net income, 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
For the three months ended December 31,
2014 2013
------------------------ ------------------------
Amount Per share Amount Per share
(unaudited) (unaudited) (unaudited) (unaudited)
----------- ----------- ----------- -----------
Net loss $ (71,998)$ (0.48)$ (3,569)$ (0.04)
Adjustments:
Loss on disposal of
assets 55,487 0.37 -- --
----------- ----------- ----------- -----------
Adjusted net loss $ (16,511)$ (0.11)$ (3,569)$ (0.04)
=========== =========== =========== ===========
Period from March 20,
For the year ended 2013 (date of inception)
December 31, 2014 to December 31, 2013
------------------------ ------------------------
Amount Per share Amount Per share
(unaudited) (unaudited) (unaudited) (unaudited)
----------- ----------- ----------- -----------
Net loss $ (116,565)$ (0.85)$ (6,307)$ (0.16)
Adjustments:
Loss on disposal of
assets 55,487 0.40 -- --
----------- ----------- ----------- -----------
Adjusted net loss $ (61,078)$ (0.45)$ (6,307)$ (0.16)
=========== =========== =========== ===========
Contact: Scorpio Bulkers Inc. +377-9798-5715 (Monaco) +1-646-432-1675 (New York)
Source: Scorpio Bulkers Inc.
