Ardmore Shipping Corporation Announces Financial Results For The Three and Twelve Months Ended December 31, 2021
Ardmore Shipping Corporation (NYSE: ASC) reported a net loss of $8.6 million for Q4 2021, down from a $19.5 million loss in Q4 2020. For the full year, the net loss totaled $38.1 million compared to a $6.0 million loss in 2020. Adjusted EBITDA was $5.5 million for Q4 2021, significantly improved from $0.9 million in Q4 2020, but full-year Adjusted EBITDA fell to $16.6 million from $57.0 million. Average TCE rates for MR tankers were $11,424 per day in Q4 2021. The company remains optimistic about recovery in 2022 despite pandemic uncertainties.
- Improved Q4 2021 net loss of $8.6 million from $19.5 million in Q4 2020.
- Q4 2021 Adjusted EBITDA increased to $5.5 million from $0.9 million in Q4 2020.
- Average TCE rate for MR tankers rose to $11,424 per day in Q4 2021.
- Full-year net loss of $38.1 million compared to $6.0 million in 2020.
- Adjusted EBITDA for the full year dropped to $16.6 million from $57.0 million in 2020.
- Decline in total operating revenue days due to fewer vessels in the spot market.
HAMILTON, Bermuda, Feb. 15, 2022 /PRNewswire/ -- Ardmore Shipping Corporation (NYSE: ASC) ("Ardmore", the "Company" or "we") today announced results for the three and twelve months ended December 31, 2021.
Highlights and Recent Activity
- Reported a net loss of
$8.6 million for the three months ended December 31, 2021, or$0.25 loss per basic and diluted share. This compares to a net loss of$19.5 million , or$0.59 loss per basic and diluted share, for the three months ended December 31, 2020. Reported Adjusted EBITDA, which includes unrealized losses on derivatives and amortization of drydock expenditure (see Non-GAAP Measures section), of$5.5 million for the three months ended December 31, 2021 as compared to$0.9 million for the three months ended December 31, 2020. - Reported a net loss of
$38.1 million for the year ended December 31, 2021 or$1.12 loss per basic and diluted share, which includes deferred finance fees written off; losses adjusted for these items (see Adjusted (loss) / earnings in the Non-GAAP Measures section) are$37.5 million , or$1.11 Adjusted loss per basic and diluted share. This compares to a net loss of$6.0 million , or$0.18 loss per basic and diluted share, and Adjusted earnings of$0.4 million , or$0.01 Adjusted earnings per basic and diluted share, for the year ended December 31, 2020. Reported Adjusted EBITDA (see Non-GAAP Measures section) of$16.6 million for the year ended December 31, 2021, as compared to$57.0 million for the year ended December 31, 2020. - MR tankers earned an average TCE rate of
$11,424 per day for the three months ended December 31, 2021 and$11,286 per day for the year ended December 31, 2021. Chemical tankers earned an average TCE rate of$11,274 per day for the three months ended December 31, 2021 and$10,982 per day for the year ended December 31, 2021. - In November 2021, e1 Marine announced it has signed a memorandum of understanding with Maritime Partners LLC, Elliott Bay Design Group and ABB to develop the world's first methanol-to-hydrogen fueled towboat, Hydrogen One, which will be powered by e1 Marine's reformer technology.
- In December 2021, Ardmore completed the issuance of an additional 15,000 Series A
8.5% Cumulative Redeemable Perpetual Preferred Shares to Maritime Partners, LLC for a purchase price of$15.0 million .
Anthony Gurnee, the Company's Chief Executive Officer, commented:
"The tanker market overall was weak throughout 2021, lagging other shipping sectors mainly due to the pandemic's negative impact on mobility and transport fuels. Given the direct connection to economic activity and consumer demand, the product and chemical tanker sectors did recover in the fourth quarter along with the global economy; however, it was not until year-end that charter rates began to properly improve, as reflected in our fourth quarter results.
Based upon clear and encouraging fundamentals, we expect our sectors to continue a recovery in 2022 from an already improved first quarter to-date, but also potentially influenced by many competing factors, including the evolution of the pandemic and the global economy, geopolitical concerns, and currently high oil prices impacting cargo movement and bunker costs.
Notwithstanding these factors, the big picture is very much one of an ongoing economic recovery, rising tonne-mile demand, and a tight tonnage supply outlook aided by heightened tanker scrapping and a rush of newbuilding orders in other shipping sectors that has pushed tanker newbuilding prices up and delivery schedules out.
Given this outlook, we have been increasing our spot exposure, while continuing a financially conservative stance in view of the potential cross currents in the market. Moving forward, Ardmore remains well positioned in terms of market upside and financial strength, with a high-quality modern fleet and a strong balance sheet."
Summary of Recent and Fourth Quarter 2021 Events
Fleet
Fleet Operations and Employment
As at December 31, 2021, the Company had 27 vessels in operation, including 21 MR tankers ranging from 45,000 deadweight tonnes (Dwt) to 49,999 Dwt (15 Eco-Design and six Eco-Mod) and six Eco-Design IMO 2 product / chemical tankers ranging from 25,000 Dwt to 37,800 Dwt.
MR Tankers (45,000 Dwt – 49,999 Dwt)
At the end of the fourth quarter of 2021, the Company had 21 MR tankers trading in the spot market or on time charters. The MR tankers earned an average TCE rate of
In the first quarter of 2022, the Company expects to have
Product / Chemical Tankers (IMO 2: 25,000 Dwt – 37,800 Dwt)
At the end of the fourth quarter of 2021, the Company had six Eco-Design IMO 2 product / chemical tankers in operation, all of which were trading in the spot market. During the fourth quarter of 2021, the Company's six Eco-Design product / chemical vessels earned an average TCE rate of
In the first quarter of 2022, the Company expects to have all revenue days for its Eco-Design IMO 2 product / chemical tankers employed in the spot market. As of February 15, 2022, the Company had fixed approximately
Drydocking
The Company had no drydock or repositioning days in the fourth quarter of 2021. The Company does not expect to have any drydock days in the first quarter of 2022.
Capital Allocation Policy
Consistent with the Company's capital allocation policy, the Company is not declaring a dividend, in respect of its common shares, for the fourth quarter of 2021.
Financing
In December 2021, Ardmore completed the issuance of an additional 15,000 Series A
Investments: e1 Marine and Element 1 Corp
In November 2021, e1 Marine announced it has signed a memorandum of understanding with Maritime Partners LLC, Elliott Bay Design Group and ABB to develop the world's first methanol-to-hydrogen fueled towboat, Hydrogen One, which will be powered by e1 Marine's reformer technology.
COVID-19
In response to the COVID-19 pandemic, many countries, ports and organizations, including those where Ardmore conducts a large part of its operations, have implemented measures to combat the outbreak, such as quarantines and travel restrictions. Such measures have caused severe trade disruptions. In addition, the pandemic has resulted and may continue to result in a significant decline in global demand for refined oil products. As Ardmore's business is the transportation of refined oil products on behalf of oil majors, oil traders and other customers, any significant decrease in demand for the cargo Ardmore transports could adversely affect demand for its vessels and services. The extent to which the pandemic may impact Ardmore's results of operations and financial condition, including possible impairments, will depend on future developments, which are highly uncertain and cannot be predicted, including, among others, new information which may emerge concerning the virus and of its variants and the level of the effectiveness and delivery of vaccines and other actions to contain or treat its impact. Accordingly, an estimate of the impact of the COVID-19 pandemic on the Company cannot be made at this time.
Results for the three months ended December 31, 2021 and 2020
The Company reported a net loss of
Results for the year ended December 31, 2021 and 2020
The Company reported a net loss of
The Company reported an Adjusted loss (see Non–GAAP Measures section) of
Management's Discussion and Analysis of Financial Results for the three months ended December 31, 2021 and 2020
Revenue. Revenue for the three months ended December 31, 2021 was
The Company's average number of operating vessels increased to 27 for the three months ended December 31, 2021, compared to 26 for the three months ended December 31, 2020.
The Company had four product tankers employed under time charters as at December 31, 2021, compared with none as at December 31, 2020. Revenue days derived from time charters were 364 for the three months ended December 31, 2021, as compared to none for the three months ended December 31, 2020. The increase in revenue days for time-chartered vessels resulted in an increase in revenue of
The Company had 2,112 spot revenue days for the three months ended December 31, 2021, as compared to 2,267 for the three months ended December 31, 2020. The Company had 23 and 26 vessels employed directly in the spot market as of the years ended December 31, 2021 and 2020, respectively. The decrease in spot revenue days resulted in a decrease in revenue of
Voyage Expenses. Voyage expenses were
TCE Rate. The average TCE rate for the Company's fleet was
Vessel Operating Expenses. Vessel operating expenses were
Charter Hire Costs. Charter hire costs were
Depreciation. Depreciation expense for the three months ended December 31, 2021 was
Amortization of Deferred Drydock Expenditures. Amortization of deferred drydock expenditures for the three months ended December 31, 2021 was
General and Administrative Expenses: Corporate. Corporate-related general and administrative expenses for the three months ended December 31, 2021 were
General and Administrative Expenses: Commercial and Chartering. Commercial and chartering expenses are the expenses attributable to Ardmore's chartering and commercial operations departments in connection with its spot trading activities. Commercial and chartering expenses for the three months ended December 31, 2021 were
Interest Expense and Finance Costs. Interest expense and finance costs include loan interest, finance lease interest, and amortization of deferred finance fees. Interest expense and finance costs for the three months ended December 31, 2021 were
Liquidity
As at December 31, 2021, the Company had
As at | ||||||
December 31, 2021 | December 31, 2020 | |||||
Cash | $ | 55,448,895 | $ | 58,365,330 | ||
Finance leases (net of sellers' credit) | 223,574,677 | 194,824,384 | ||||
Senior Debt | 114,467,634 | 157,710,865 | ||||
Revolving Credit Facilities | 30,633,757 | 53,631,491 | ||||
Total debt | 368,676,068 | 406,166,740 | ||||
Total net debt | $ | 313,227,173 | $ | 347,801,410 | ||
Conference Call
The Company plans to have a conference call on February 15, 2022 at 10:00 a.m. Eastern Time to discuss its results for the quarter and year ended December 31, 2021. All interested parties are invited to listen to the live conference call and review the related slide presentation by choosing from the following options:
- By dialing 844–492–3728 (U.S.) or 412–542–4189 (International) and referencing "Ardmore Shipping."
- By accessing the live webcast at Ardmore Shipping's website at www.ardmoreshipping.com.
Participants should dial into the call 10 minutes before the scheduled time.
If you are unable to participate at this time, an audio replay of the call will be available through February 22, 2022 at 877–344–7529 or 412–317–0088. Enter the passcode 6746358 to access the audio replay. A recording of the webcast, with associated slides, will also be available on the Company's website. 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.
About Ardmore Shipping Corporation
Ardmore owns and operates a fleet of MR product and chemical tankers ranging from 25,000 to 50,000 deadweight tonnes. Ardmore provides seaborne transportation of petroleum products and chemicals worldwide to oil majors, national oil companies, oil and chemical traders, and chemical companies, with its modern, fuel-efficient fleet of mid-size tankers.
Ardmore's core strategy is to continue to develop a modern, high-quality fleet of product and chemical tankers, build key long-term commercial relationships and maintain its cost advantage in assets, operations and overhead, while creating synergies and economies of scale as the company grows. Ardmore provides its services to customers through voyage charters, commercial pools, and time charters, and enjoys close working relationships with key commercial and technical management partners.
Ardmore's Energy Transition Plan ("ETP") focusses on three key areas: transition technologies, transition projects, and sustainable (non-fossil fuel) cargos. The ETP is an extension of Ardmore's strategy, building on its core strengths of tanker chartering, shipping operations, technical and operational fuel efficiency improvements, technical management, construction supervision, project management, investment analysis, and ship finance. Ardmore has established Ardmore Ventures as Ardmore's holding company for existing and future potential investments related to the Energy Transition Plan and completed its first projects under the ETP in June 2021.
Ardmore Shipping Corporation | ||||
As at | ||||
December 31, 2021 | December 31, 2020 | |||
ASSETS | ||||
Current assets | ||||
Cash and cash equivalents | 55,448,895 | 58,365,330 | ||
Receivables, net of allowance for bad debts of | 20,303,507 | 17,808,496 | ||
Prepaid expenses and other assets | 3,511,349 | 3,683,910 | ||
Advances and deposits | 3,550,942 | 2,516,646 | ||
Inventories | 11,095,318 | 10,274,062 | ||
Current portion of derivative assets | 306,912 | — | ||
Vessel held for sale | — | 9,895,000 | ||
Total current assets | 94,216,923 | 102,543,444 | ||
Non-current assets | ||||
Investments and other assets, net | 11,081,579 | 678,632 | ||
Vessels and vessel equipment, net | 603,227,228 | 631,458,305 | ||
Deferred drydock expenditures, net | 8,878,578 | 10,216,090 | ||
Advances for ballast water treatment systems | 2,032,894 | 2,568,874 | ||
Amount receivable in respect of finance leases | 2,880,000 | 2,880,000 | ||
Non-current portion of derivative assets | 981,835 | — | ||
Operating lease, right-of-use asset | 1,231,877 | 1,662,510 | ||
Total non-current assets | 630,313,991 | 649,464,411 | ||
TOTAL ASSETS | 724,530,914 | 752,007,855 | ||
LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | ||||
Current liabilities | ||||
Accounts payable | 8,577,567 | 9,125,321 | ||
Accrued expenses and other liabilities | 10,741,500 | 11,233,767 | ||
Deferred revenue | 2,069,750 | — | ||
Accrued interest on debt and finance leases | 650,742 | 769,304 | ||
Current portion of long-term debt | 15,103,186 | 22,456,396 | ||
Current portion of finance lease obligations | 21,083,831 | 18,454,222 | ||
Current portion of derivative liabilities | — | 397,418 | ||
Current portion of operating lease obligations | 273,141 | 463,559 | ||
Total current liabilities | 58,499,717 | 62,899,987 | ||
Non-current liabilities | ||||
Non-current portion of long-term debt | 129,998,205 | 188,054,568 | ||
Non-current portion of finance lease obligations | 205,370,846 | 179,250,162 | ||
Non-current portion of derivative liabilities | — | 433,974 | ||
Non-current portion of operating lease obligations | 722,085 | 1,034,218 | ||
Other non-current liabilities | 942,508 | — | ||
Total non-current liabilities | 337,033,644 | 368,772,922 | ||
TOTAL LIABILITIES | 395,533,361 | 431,672,909 | ||
Redeemable Preferred Stock | ||||
Cumulative Series A | 37,043,138 | — | ||
Total redeemable preferred stock | 37,043,138 | — | ||
Stockholders' equity | ||||
Common stock | 363,839 | 352,067 | ||
Additional paid in capital | 426,102,179 | 418,180,983 | ||
Accumulated other comprehensive income / (loss) | 1,044,067 | (729,135) | ||
Treasury stock | (15,635,765) | (15,635,765) | ||
Accumulated deficit | (119,919,905) | (81,833,204) | ||
Total stockholders' equity | 291,954,415 | 320,334,946 | ||
Total redeemable preferred stock and stockholders' equity | 328,997,553 | 320,334,946 | ||
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | 724,530,914 | 752,007,855 | ||
Ardmore Shipping Corporation | ||||||||
Three months ended | Year ended | |||||||
December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | |||||
Revenue, net | 52,459,069 | 41,725,326 | 192,484,301 | 220,057,606 | ||||
Voyage expenses | (24,592,032) | (19,888,091) | (88,577,719) | (81,253,212) | ||||
Vessel operating expenses | (15,800,667) | (16,422,424) | (60,833,537) | (62,546,733) | ||||
Charter hire costs | (2,084,859) | (1,211,978) | (6,930,193) | (1,367,528) | ||||
Depreciation | (8,009,390) | (8,268,960) | (31,703,305) | (32,187,324) | ||||
Amortization of deferred drydock | (1,284,161) | (1,712,360) | (5,168,526) | (6,198,245) | ||||
General and administrative expenses | ||||||||
Corporate | (3,341,437) | (3,063,281) | (16,071,865) | (15,122,906) | ||||
Commercial and chartering | (928,386) | (239,660) | (3,125,574) | (2,780,970) | ||||
Unrealized gains / (losses) on derivatives | 221,613 | (25,588) | 276,268 | (113,591) | ||||
Interest expense and finance costs | (4,300,143) | (3,915,885) | (16,771,198) | (18,168,155) | ||||
Interest income | 16,097 | 25,776 | 55,088 | 281,618 | ||||
Loss on vessel held for sale | — | (6,447,309) | — | (6,447,309) | ||||
Loss before taxes | (7,644,296) | (19,444,434) | (36,366,260) | (5,846,749) | ||||
Income tax | (13,587) | (70,968) | (149,593) | (199,446) | ||||
Loss from equity method investments | (258,192) | — | (316,790) | — | ||||
Net loss | (7,916,075) | (19,515,402) | (36,832,643) | (6,046,195) | ||||
Preferred dividend | (636,935) | — | (1,254,058) | — | ||||
Net loss attributable to common | (8,553,010) | (19,515,402) | (38,086,701) | (6,046,195) | ||||
Loss per share, basic and diluted | (0.25) | (0.59) | (1.12) | (0.18) | ||||
Adjusted (loss) / earnings (1) | (8,553,010) | (13,068,093) | (37,517,863) | 401,114 | ||||
Adjusted (loss) / earnings per share, | (0.25) | (0.39) | (1.11) | 0.01 | ||||
Adjusted (loss) / earnings per share, | (0.25) | (0.39) | (1.11) | 0.01 | ||||
Weighted average number of shares | 34,363,884 | 33,237,297 | 33,882,932 | 33,241,936 | ||||
Weighted average number of shares | 34,363,884 | 33,237,297 | 33,882,932 | 33,443,250 | ||||
(1) | Adjusted (loss) / earnings is a non-GAAP measure and is defined and reconciled under the "Non-GAAP Measures" section. Adjusted (loss) / earnings has been calculated as Earnings per share reported under US GAAP as adjusted for certain unrealized and realized gains and losses (see Non-GAAP Measures Section). | |||
Ardmore Shipping Corporation | ||||
Year ended | ||||
December 31, 2021 | December 31, 2020 | |||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net loss | (36,832,643) | (6,046,195) | ||
Adjustments to reconcile net loss to net cash (used in) / provided by operating | ||||
Depreciation | 31,703,305 | 32,187,324 | ||
Amortization of deferred drydock expenditures | 5,168,526 | 6,198,245 | ||
Share-based compensation | 2,612,968 | 3,000,672 | ||
Loss on vessel held for sale | — | 6,447,309 | ||
Amortization of deferred finance fees | 2,192,177 | 1,765,271 | ||
Unrealized (gains) / losses on derivatives | (276,268) | 113,591 | ||
Foreign exchange | (71,917) | 108,978 | ||
Loss from equity method investments | 316,790 | — | ||
Payments for drydocks | (5,882,866) | (7,003,305) | ||
Changes in operating assets and liabilities: | ||||
Receivables | (2,495,011) | 12,274,862 | ||
Prepaid expenses and other assets | 172,561 | (1,743,880) | ||
Advances and deposits | (1,034,296) | 1,597,419 | ||
Inventories | (821,256) | (115,327) | ||
Accounts payable | 1,151,201 | 2,543,080 | ||
Accrued expenses and other liabilities | (701,459) | (5,098,531) | ||
Deferred revenue | 2,069,750 | — | ||
Accrued interest on debt and finance leases | (156,966) | (135,064) | ||
Net cash (used in) / provided by operating activities | (2,885,404) | 46,094,449 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Proceeds from sale of vessels | 9,895,000 | — | ||
Payments for acquisition of vessels and vessel equipment | (2,475,399) | (18,720,337) | ||
Advances for ballast water treatment systems | (157,879) | (2,184,466) | ||
Payments for other non-current assets | (93,798) | (88,630) | ||
Payments for equity investments | (5,541,364) | — | ||
Net cash provided by / (used in) investing activities | 1,626,560 | (20,993,433) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Proceeds from long-term debt | — | 20,375,243 | ||
Repayments of long-term debt | (66,911,512) | (18,017,863) | ||
Proceeds from finance leases | 49,000,000 | — | ||
Repayments of finance leases | (19,959,944) | (18,650,009) | ||
Payments for deferred finance fees | (980,000) | (220,000) | ||
Repurchase of common stock | — | (286,856) | ||
Payment of dividend | — | (1,659,308) | ||
Issuance of preferred stock, net | 37,985,646 | — | ||
Payment of preferred dividend | (791,781) | — | ||
Net cash used in financing activities | (1,657,591) | (18,458,793) | ||
Net (decrease) / increase in cash and cash equivalents | (2,916,435) | 6,642,223 | ||
Cash and cash equivalents at the beginning of the year | 58,365,330 | 51,723,107 | ||
Cash and cash equivalents at the end of the period | 55,448,895 | 58,365,330 | ||
Ardmore Shipping Corporation | ||||||||
Three months ended | Year ended | |||||||
December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | |||||
Adjusted EBITDA (1) | 5,453,496 | 899,892 | 16,628,623 | 56,986,257 | ||||
AVERAGE DAILY DATA | ||||||||
MR Tankers Eco-Design Spot TCE | 11,024 | 9,436 | 10,931 | 15,650 | ||||
Fleet TCE per day (2) | 11,390 | 9,764 | 11,216 | 15,355 | ||||
Fleet operating expenses per day (3) | 6,141 | 6,134 | 5,967 | 6,073 | ||||
Technical management fees per day (4) | 451 | 384 | 459 | 439 | ||||
6,592 | 6,518 | 6,426 | 6,512 | |||||
MR Tankers Eco-Design | ||||||||
TCE per day (2) | 11,614 | 9,603 | 11,501 | 15,993 | ||||
Vessel operating expenses per day (5) | 6,712 | 6,560 | 6,485 | 6,530 | ||||
MR Tankers Eco-Mod | ||||||||
TCE per day (2) | 10,950 | 9,052 | 10,667 | 14,284 | ||||
Vessel operating expenses per day (5) | 6,366 | 6,447 | 6,359 | 6,559 | ||||
Prod/Chem Tankers Eco-Design (25k | ||||||||
TCE per day (2) | 11,274 | 10,916 | 10,982 | 14,332 | ||||
Vessel operating expenses per day (5) | 6,441 | 6,475 | 6,324 | 6,434 | ||||
FLEET | ||||||||
Average number of owned operating | 25.0 | 26.0 | 25.0 | 25.4 | ||||
(1) | Adjusted EBITDA is a non-GAAP measure and is defined and reconciled to the most directly comparable U.S. GAAP measure under the "Non-GAAP Measures" section. | ||
(2) | Time Charter Equivalent ("TCE") rate, a non-GAAP measure, represents net revenues (revenues less voyage expenses) divided by revenue days. Revenue days are the total number of calendar days the vessels are in the Company's possession less off-hire days generally associated with drydocking or repairs and idle days associated with repositioning of vessels held for sale. Net revenue utilized to calculate the TCE rate is determined on a discharge to discharge basis, which is different from how the Company records revenue under U.S. GAAP. Under discharge to discharge, revenues are recognized beginning from the discharge of cargo from the prior voyage to the anticipated discharge of cargo in the current voyage, and voyage expenses are recognized as incurred. | ||
(3) | Fleet operating expenses per day are routine operating expenses and comprise crewing, repairs and maintenance, insurance, stores, lube oils and communication expenses. These amounts do not include expenditures related to upgradings and enhancements or other non-routine expenditures which were expensed during the period. | ||
(4) | Technical management fees are fees paid to third-party technical managers. | ||
(5) | Vessel operating expenses per day include technical management fees. | ||
Ardmore Shipping Corporation | ||||||||||||||||
Estimated Resale | Estimated | |||||||||||||||
Newbuilding | Depreciated | |||||||||||||||
Eco | Price (1) | Replacement | ||||||||||||||
Vessel | IMO | Built | Country | DWT | Specification | December 31, 2021 | Value (2) | |||||||||
Seavaliant | IMO2/3 | Feb–13 | S. Korea | 49,998 | Eco-Design | $ | 39.00 | $ | 26.34 | |||||||
Seaventure | IMO2/3 | Jun–13 | S. Korea | 49,998 | Eco-Design | $ | 39.00 | $ | 26.73 | |||||||
Seavantage | IMO2/3 | Jan–14 | S. Korea | 49,997 | Eco-Design | $ | 39.00 | $ | 27.61 | |||||||
Seavanguard | IMO2/3 | Feb–14 | S. Korea | 49,998 | Eco-Design | $ | 39.00 | $ | 27.72 | |||||||
Sealion | IMO2/3 | May–15 | S. Korea | 49,999 | Eco-Design | $ | 39.00 | $ | 29.55 | |||||||
Seafox | IMO2/3 | Jun–15 | S. Korea | 49,999 | Eco-Design | $ | 39.00 | $ | 29.67 | |||||||
Seawolf | IMO2/3 | Aug–15 | S. Korea | 49,999 | Eco-Design | $ | 39.00 | $ | 29.86 | |||||||
Seahawk | IMO2/3 | Nov–15 | S. Korea | 49,999 | Eco-Design | $ | 39.00 | $ | 30.17 | |||||||
Endeavour | IMO2/3 | Jul–13 | S. Korea | 49,997 | Eco-Design | $ | 39.00 | $ | 26.91 | |||||||
Enterprise | IMO2/3 | Sep–13 | S. Korea | 49,453 | Eco-Design | $ | 39.00 | $ | 27.14 | |||||||
Endurance | IMO2/3 | Dec–13 | S. Korea | 49,466 | Eco-Design | $ | 39.00 | $ | 27.47 | |||||||
Encounter | IMO2/3 | Jan–14 | S. Korea | 49,478 | Eco-Design | $ | 39.00 | $ | 27.53 | |||||||
Explorer | IMO2/3 | Jan–14 | S. Korea | 49,494 | Eco-Design | $ | 39.00 | $ | 27.64 | |||||||
Exporter | IMO2/3 | Feb–14 | S. Korea | 49,466 | Eco-Design | $ | 39.00 | $ | 27.75 | |||||||
Engineer | IMO2/3 | Mar–14 | S. Korea | 49,420 | Eco-Design | $ | 39.00 | $ | 27.85 | |||||||
Sealeader | IMO3 | Jun–08 | Japan | 47,463 | Eco-Mod | $ | 39.00 | $ | 19.27 | |||||||
Sealifter | IMO3 | Aug–08 | Japan | 47,472 | Eco-Mod | $ | 39.00 | $ | 19.56 | |||||||
Sealancer | IMO3 | Jul–08 | Japan | 47,451 | Eco-Mod | $ | 39.00 | $ | 19.39 | |||||||
Seafarer | IMO3 | Jun–10 | Japan | 49,999 | Eco-Mod | $ | 39.00 | $ | 22.24 | |||||||
Dauntless | IMO2 | Feb–15 | S. Korea | 37,764 | Eco-Design | $ | 36.00 | $ | 26.83 | |||||||
Defender | IMO2 | Feb–15 | S. Korea | 37,791 | Eco-Design | $ | 36.00 | $ | 26.87 | |||||||
Cherokee | IMO2 | Jan–15 | Japan | 25,215 | Eco-Design | $ | 33.00 | $ | 24.31 | |||||||
Cheyenne | IMO2 | Mar–15 | Japan | 25,217 | Eco-Design | $ | 33.00 | $ | 24.59 | |||||||
Chinook | IMO2 | Jul–15 | Japan | 25,217 | Eco-Design | $ | 33.00 | $ | 24.97 | |||||||
Chippewa | IMO2 | Nov–15 | Japan | 25,217 | Eco-Design | $ | 33.00 | $ | 25.33 | |||||||
$ | 653.30 | |||||||||||||||
Cash / Debt / Work. Cap / Other Assets | $ | (301.06) | ||||||||||||||
Total Asset Value (Assets) (3) | $ | 352.24 | ||||||||||||||
DRV / Share (3)(4) | $ | 10.25 | ||||||||||||||
Ardmore Commercial Management (5) | $ | 19.53 | ||||||||||||||
Total Asset Value (Assets & Commercial Management) (3) | $ | 371.77 | ||||||||||||||
DRV / Share (3)(4) | $ | 10.82 | ||||||||||||||
Investment in Element 1 Corp. / e1 Marine (6) | $ | 10.54 | ||||||||||||||
Total Asset Value (Assets, Commercial Management & | $ | 382.31 | ||||||||||||||
DRV / Share (3)(4)(6) | $ | 11.13 | ||||||||||||||
1. | Based on the average of two broker estimates of prompt resale for a newbuild vessel of equivalent deadweight tonne at a yard in South Korea as at December 31, 2021. | |||
2. | Depreciated Replacement Value ("DRV") is based on estimated resale price for a newbuild vessel depreciated for the age of each vessel (assuming an estimated useful life of 25 years on a straight-line basis and assuming a residual scrap value of | |||
3. | Depreciated Asset Value ("DRV") and DRV per share are non-GAAP measures. Management believes that many investors use DRV as a reference point in assessing valuation of fleets of ships and similar assets. | |||
4. | DRV / Share calculated using 34,363,884 shares outstanding as at December 31, 2021. | |||
5. | Ardmore Commercial Management is management's estimate of the value of Ardmore's commercial management and pooling business. The estimate is based on industry standard commercial management and pooling fees in determining revenue less Ardmore's commercial and chartering overhead (as stated in Ardmore's Statement of Operations) and applying an illustrative multiple to the resulting net earnings of 7x. The multiple is illustrative only and may not be indicative of the valuation multiple the Company could achieve if it were to sell its commercial management and pooling business. Revenue of this business is comprised of (i) commission ( | |||
6. | Valuation of investment in E1 Corp. and e1 Marine (a joint venture with E1 Corp and Maritime Partners, LLC, of which ASC owns | |||
CO2 Emissions Reporting(1)
In April 2018, the International Maritime Organization's ("IMO") Marine Environment Protection Committee ("MEPC") adopted an initial strategy for the reduction of greenhouse gas ("GHG") emissions from ships, setting out a vision to reduce GHG emissions from international shipping and phase them out as soon as possible. Ardmore is committed to transparency and contributing to the reduction of CO2 emissions in the Company's industry. Ardmore's reporting methodology is in line with the framework set out within the IMO's Data Collection System ("DCS") initiated in 2019.
Three months ended | Twelve months ended | ||||||||
December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | ||||||
Number of Owned & TC-In Vessels in Operation (at | 27 | 27 | 27 | 27 | |||||
Fleet Average Age | 8.6 | 7.7 | 8.6 | 7.7 | |||||
CO2 Emissions Generated in Metric Tonnes | 104,499 | 99,479 | 406,721 | 389,721 | |||||
Distance Travelled (Miles) | 400,978 | 359,556 | 1,554,032 | 1,441,703 | |||||
Fuel Consumed in Metric Tonnes | 33,073 | 31,355 | 128,472 | 122,899 | |||||
Cargo Heating and Tank Cleaning Fuel Consumption | |||||||||
Fuel Consumed in Metric Tonnes | 687 | 871 | 4,048 | 3,178 | |||||
% of Total Fuel Consumed | |||||||||
Annual Efficiency Ratio (AER) for the period(2) | |||||||||
Fleet | 5.81g / tm | 6.18g / tm | 5.84g / tm | 6.04g / tm | |||||
MR Eco-Design | 5.53g / tm | 5.87g / tm | 5.59g / tm | 5.71g / tm | |||||
MR Eco-Mod | 5.77g / tm | 6.58g / tm | 5.90g / tm | 6.36g / tm | |||||
Chemical | 7.43g / tm | 7.22g / tm | 7.19g / tm | 7.40g / tm | |||||
Chemical (Less Cargo Heating & Tank Cleaning)(3) | 6.75g / tm | 6.50g / tm | 6.33g / tm | 6.52g / tm | |||||
Energy Efficiency Operational Indicator (EEOI) for | |||||||||
Fleet | 12.07g / ctm | 12.63g / ctm | 12.26g / ctm | 11.77g / tm | |||||
MR Eco-Design | 11.55g / ctm | 12.17g / ctm | 12.33g / ctm | 11.32g / tm | |||||
MR Eco-Mod | 13.11g / ctm | 13.36g / ctm | 11.66g / ctm | 11.72g / tm | |||||
Chemical | 13.00g / ctm | 13.55g / ctm | 12.70g / ctm | 13.64g / tm | |||||
Chemical (Less Cargo Heating & Tank Cleaning)(3) | 12.67g / ctm | 10.90g / ctm | 11.43g / ctm | 11.62g / ctm | |||||
Wind Force (% greater than 4 on BF) | |||||||||
% Idle Time(5) | |||||||||
tm = tonne-mile | |||||||||
ctm = cargo tonne-mile | |||||||||
Ardmore Performance
Ardmore is continuing to perform well on both AER and EEOI. Results vary quarter to quarter depending on ship activity, ballast / laden ratio, cargo carried, weather, waiting time and time in port, however analysis is also presented on a trailing 12-month basis to provide a more accurate assessment of Ardmore's progress over a longer period and to mitigate seasonality.
From a weather perspective, rougher weather (based on Beaufort Scale wind force rating being greater than 4) will generally have a mitigating impact on the ability to optimize fuel consumption, while idle time will impact ships metrics as they will still require power to run but will not be moving.
Overall Ardmore Shipping's carbon emissions for the trailing 12-month period have increased
Continued improvements are being achieved through a combination of technological advancements and operational optimization.
In addition, we have also presented our Chemical Tanker ratios, with and without the impact of cargo heating and tank cleaning operations to provide enhanced transparency and to highlight the impact of this activity on our Chemical Tankers' ratios
1 Ardmore's emissions data is based on the reporting tools and information reasonably available to Ardmore and its applicable third-party technical managers for Ardmore's owned fleet. Management assesses such data and may adjust and restate the data to reflect latest information. It is expected that the shipping industry will continue to refine the performance measures for emissions and efficiency over time. AER and EEOI metrics are impacted by external factors such as charter speed, vessel orders and weather, in conjunction with overall market factors such as cargo load sizes and fleet utilization rate. As such, variance in performance can be found in the reported emissions between two periods for the same vessel and between vessels of a similar size and type. Furthermore, other companies may report slight variations (e.g. some shipping companies report CO2 in tonnes per kilometre as opposed to CO2 in tonnes per nautical mile) and consequently it is not always practical to directly compare emissions from different companies. The figures reported above represent Ardmore's initial findings; the Company is committed to improving the methodology and transparency of its emissions reporting in line with industry best practices. Accordingly, the above results may vary as the methodology and performance measures set out by the industry evolve. | ||
2 Annual Efficiency Ratio ("AER") is a measure of carbon efficiency using the parameters of fuel consumption, distance travelled, and design deadweight tonnage ("DWT"). AER is reported in unit grams of CO2 per ton-mile (gCO2/dwt-nm). It is calculated by dividing (i) mass of fuel consumed by type converted to metric tonnes of CO2 by (ii) DWT multiplied by distance travelled in nautical miles. | ||
3 The AER and EEOI figures are presented including the impact of cargo heating and tank cleaning operations unless stated. | ||
4 Energy Efficiency Operational Indicator ("EEOI") is a tool for measuring CO2 gas emissions in a given time period per unit of transport work performed. It is calculated by dividing (i) mass of fuel consumed by type converted to metric tonnes of CO2 by (ii) cargo carried in tonnes multiplied by laden voyage distance in nautical miles. This calculation is performed as per IMO MEPC.1/Circ684. | ||
5 Idle time is the amount of time a vessel is waiting in port or awaiting the laycan or waiting in port/at sea unfixed. |
Non-GAAP Measures
This press release describes EBITDA, Adjusted EBITDA and Adjusted (loss) / earnings, which are not measures prepared in accordance with U.S. GAAP and are defined and reconciled below. EBITDA is defined as earnings before interest, unrealized (losses) / gains on derivatives, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before certain items that Ardmore believes are not representative of its operating performance, including gain or loss on sale of vessels. Adjusted (loss) / earnings excludes certain items from net (loss) / income, including gain or loss on sale of vessels and write-off of deferred finance fees because they are considered to be not representative of its operating performance.
These non-GAAP measures are presented in this press release as the Company believes that they provide investors with a means of evaluating and understanding how Ardmore's management evaluates operating performance. EBITDA and Adjusted EBITDA increase the comparability of the Company's fundamental performance from period to period. This increased comparability is achieved by excluding the potentially disparate effects between periods of interest expense, taxes, depreciation or amortization, which items are affected by various and possibly changing financing methods, capital structure and historical cost basis and which items may significantly affect net income between periods. The Company believes that including EBITDA, Adjusted EBITDA and Adjusted (loss) / earnings as financial and operating measures assists investors in making investment decisions regarding the Company and its common stock.
These non-GAAP measures should not be considered in isolation from, as substitutes for, or superior to, financial measures prepared in accordance with U.S. GAAP. In addition, these non-GAAP measures may not have a standardized meaning and therefore may not be comparable to similar measures presented by other companies. All amounts in the tables below are expressed in U.S. dollars, unless otherwise stated.
Three months ended | Year ended | |||||||
Reconciliation of net loss to EBITDA | December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | ||||
Net loss | (7,916,075) | (19,515,402) | (36,832,643) | (6,046,195) | ||||
Interest income | (16,097) | (25,776) | (55,088) | (281,618) | ||||
Interest expense and finance costs | 4,300,143 | 3,915,885 | 16,771,198 | 18,168,155 | ||||
Income tax | 13,587 | 70,968 | 149,593 | 199,446 | ||||
Unrealized gains / (losses) on derivatives | (221,613) | 25,588 | (276,268) | 113,591 | ||||
Depreciation | 8,009,390 | 8,268,960 | 31,703,305 | 32,187,324 | ||||
Amortization of deferred drydock expenditures | 1,284,161 | 1,712,360 | 5,168,526 | 6,198,245 | ||||
EBITDA | 5,453,496 | (5,547,417) | 16,628,623 | 50,538,948 | ||||
Loss on vessel held for sale | — | 6,447,309 | — | 6,447,309 | ||||
ADJUSTED EBITDA | 5,453,496 | 899,892 | 16,628,623 | 56,986,257 | ||||
Three months ended | Year ended | |||||||
Reconciliation of net loss to Adjusted (loss) / earnings | December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | ||||
Net loss attributable to common stockholders | (8,553,010) | (19,515,402) | (38,086,701) | (6,046,195) | ||||
Loss on vessel held for sale | — | 6,447,309 | — | 6,447,309 | ||||
Write-off of deferred finance fees | — | — | 568,838 | — | ||||
Adjusted (loss) / earnings | (8,553,010) | (13,068,093) | (37,517,863) | 401,114 | ||||
Adjusted (loss) / earnings per share, basic | (0.25) | (0.39) | (1.11) | 0.01 | ||||
Adjusted (loss) / earnings per share, diluted | (0.25) | (0.39) | (1.11) | 0.01 | ||||
Weighted average number of shares | 34,363,884 | 33,237,297 | 33,882,932 | 33,241,936 | ||||
Weighted average number of shares | 34,363,884 | 33,237,297 | 33,882,932 | 33,443,250 | ||||
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. In some cases, you can identify the forward-looking statements by the use of words such as "believe", "anticipate", "intends", "estimate", "forecast", "plan", "potential", "may", "expect", and similar expressions.
Forward looking statements in this press release include, among others, the following statements: future operating or financial results; global and regional economic conditions and trends; shipping market trends and market fundamentals, including tanker demand and supply and future growth rates; expected oil demand recovery and future tankers rates, and factors that may affect such rates; the effect of the COVID-19 pandemic on the Company's business, financial condition and the results of operation; the Company's expectations regarding the timing and impact of economic recovery from the pandemic; expected employment of the Company's vessels during the first quarter of 2022; expected drydocking days in the first quarter of 2022; implementation of the Company's Energy Transition Plan; management's estimates of the Depreciated Replacement Value (DRV) of its vessels and of the value of the Company's commercial management and pooling business; trends in the Company's performance as measured by energy efficiency and emission-reduction metrics; the impact of energy transition on the Company and the markets in which the Company operates; expected continuation of refinement by the Company of performance measures for emissions and efficiency; and the expected implementation timing of e1 Marine's recently announced initiatives. The forward-looking statements in this press release are based upon various assumptions, including, without limitation, Ardmore management's examination of historical operating trends, data contained in the Company's records and other data available from third parties. Although the Company believes 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 the Company's control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. The Company cautions readers of this release not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to update or revise any forward-looking statements. These forward-looking statements are not guarantees of the Company's future performance, and actual results and future developments may vary materially from those projected in the forward-looking statements.
In addition to these important factors, other important factors that, in the Company's view, could cause actual results to differ materially from those discussed in the forward-looking statements include: the amount of the world tanker fleet used for storage purposes; current expected spot rates compared with current and expected charter rates; the failure of counterparties to fully perform their contracts with the Company; the strength of world economies and currencies; general market conditions, including fluctuations in charter rates and vessel values; changes in demand for and the supply of tanker vessel capacity; changes in the projections of spot and time charter or pool trading of the Company's vessels; the effect of the COVID-19 pandemic on, among others, oil demand, the Company's business, financial condition and results of operation, including its liquidity; fluctuations in oil prices; changes in the Company's operating expenses, including bunker prices, drydocking and insurance costs; general domestic and international political conditions; potential disruption of shipping routes due to accidents, piracy or political events; the market for the Company's vessels; competition in the tanker industry; availability of financing and refinancing; charter counterparty performance; changes in governmental rules and regulations or actions taken by regulatory authorities; the Company's ability to charter vessels for all remaining revenue days during the first quarter of 2022 in the spot market; vessels breakdowns and instances of off-hire; the ability of e1 Marine to complete it's contemplated projects on time; and other factors. Please see the Company's filings with the U.S. Securities and Exchange Commission, including the Company's Form 20–F for the year ended December 31, 2020, for a more complete discussion of these and other risks and uncertainties.
Investor Relations Enquiries:
Mr. Leon Berman | Mr. Bryan Degnan |
The IGB Group | The IGB Group |
45 Broadway, Suite 1150 | 45 Broadway, Suite 1150 |
New York, NY 10006 | New York, NY 10006 |
Tel: 212–477–8438 | Tel: 646–673–9701 |
Fax: 212–477–8636 | Fax: 212–477–8636 |
Email: lberman@igbir.com | Email: bdegnan@igbir.com |
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SOURCE Ardmore Shipping Corporation
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