Genco Shipping & Trading Limited Announces Fourth Quarter Financial Results
Genco Shipping & Trading Limited (NYSE:GNK) reported its Q4 and FY 2022 financial results, declaring a $0.50 per share dividend, marking its 14th consecutive quarterly dividend. The dividend represents an 11% annualized yield based on the stock price as of February 21, 2023. Genco generated a net income of $28.7 million for Q4 2022 with earnings per share of $0.67, despite lower revenues of $127 million compared to $183 million in Q4 2021. The company paid down $8.75 million in debt, reducing total debt to $171 million while maintaining a strong liquidity of $277 million. Overall, Genco declared cumulative dividends of $2.57 per share in 2022, reflecting a robust strategy despite challenging market conditions.
- Declared $0.50 dividend for Q4 2022, 14th consecutive payout.
- Net income of $28.7 million for Q4 2022, with $0.67 EPS.
- Cumulative dividends of $2.57 per share in 2022, 11% annualized yield.
- Paid down $8.75 million in debt, reducing total debt to $171 million.
- Strong liquidity position of $277 million as of December 31, 2022.
- Revenues decreased to $127 million in Q4 2022 from $183 million in Q4 2021.
- Average daily TCE rates fell to $19,330, down from $35,200 year-over-year.
- Net income for 2022 was $158.6 million, down from $182 million in 2021.
Declares Dividend of
Generated
NEW YORK, Feb. 22, 2023 (GLOBE NEWSWIRE) -- Genco Shipping & Trading Limited (NYSE:GNK) (“Genco” or the “Company”), the largest U.S. headquartered drybulk shipowner focused on the global transportation of commodities, today reported its financial results for the three months and twelve months ended December 31, 2022.
The following financial review discusses the results for the three months and twelve months ended December 31, 2022 and December 31, 2021.
Fourth Quarter 2022 and Year-to-Date Highlights
- Declared a
$0.50 per share dividend for the fourth quarter of 2022- Q4 2022 dividend represents an annualized yield of
11% on Genco’s closing share price on February 21, 2023
- Q4 2022 dividend represents an annualized yield of
- Q4 2022 dividend marks the Company’s 14th consecutive quarterly payout, reflecting cumulative dividends totaling
$4.29 5 per share or approximately24% of the closing share price on February 21, 2023- Q4 2022 dividend is payable on or about March 14, 2023 to all shareholders of record as of March 7, 2023
- Prepaid
$8.75 million of debt on a voluntary basis during Q4 2022, to reduce our debt to$171.0 million - Net loan-to-value of
11% 1 as of February 21, 2023 - Since the start of 2021, we have paid down
$278 million or62% of our debt
- Net loan-to-value of
- Recorded net income of
$28.7 million for the fourth quarter of 2022- Basic and diluted earnings per share of
$0.67
- Basic and diluted earnings per share of
- Voyage revenues totaled
$127.0 million and net revenue2 (voyage revenues minus voyage expenses, charter hire expenses and realized gains or losses on fuel hedges) totaled$76.0 million during Q4 2022- Our average daily fleet-wide time charter equivalent, or TCE2, for Q4 2022 was
$19,330 - We estimate our TCE to date for Q1 2023 to be
$14,217 for84% of our owned fleet available days, based on both period and current spot fixtures
- Our average daily fleet-wide time charter equivalent, or TCE2, for Q4 2022 was
- For FY 2022, our fleet-wide TCE was
$23,824 , which outperformed our scrubber-adjusted benchmark by nearly$3,000 per vessel per day3 - Recorded adjusted EBITDA of
$226.8 million during 20222 - Over the last two years, we have generated
$340.6 million of net income and$479.7 million of adjusted EBITDA- During that period, the Company also paid
$129.2 million in dividends and prepaid$278.2 million in debt
- During that period, the Company also paid
- Increased our liquidity position to
$277.0 million as of December 31, 2022, including:$64.1 million of cash on the balance sheet$212.9 million of revolver availability
- Completed fuel efficiency upgrades on seven Capesize vessels ahead of requirements for IMO 2023 environmental regulations
John C. Wobensmith, Chief Executive Officer, commented, “During 2022, we advanced our strategy of creating a unique drybulk vehicle with an attractive risk-reward profile, while generating sizeable earnings and returning significant capital to shareholders. Dividends under our value strategy have been robust, highlighted by the
Mr. Wobensmith continued, “As we look through what we believe to be temporary seasonal factors currently impacting drybulk rates, we remain optimistic on the go-forward outlook based on favorable fundamentals that continue to be in place. Specifically, we currently see a number of compelling catalysts, including the reopening of China together with a historically low orderbook, which bode well for a strengthening market throughout 2023. We believe Genco is in a strong position to capitalize on these market dynamics due to our sizeable fleet, best-in-class commercial platform and barbell approach to fleet deployment.”
1 Represents the principal amount of our credit facility debt outstanding less our cash and cash equivalents as of December 31, 2022 divided by estimates of the market value of our fleet as of February 21, 2023 from VesselsValue.com. The actual market value of our vessels may vary.
2 We believe the non-GAAP measure presented provides investors with a means of better evaluating and understanding the Company’s operating performance. Please see Summary Consolidated Financial and Other Data below for a further reconciliation.
3 Our benchmark is defined as the weighted average of the Baltic Supramax Index as published by the Baltic Exchange and the Platts Scrubber Fitted Capesize Index net of
Comprehensive Value Strategy
Genco’s comprehensive value strategy is centered on three pillars:
- Dividends: paying sizeable quarterly cash dividends to shareholders
- Deleveraging: through voluntary debt prepayments to maintain low financial leverage, and
- Growth: opportunistically growing the Company’s asset base
We believe this strategy is a key differentiator for Genco and will drive shareholder value over the long-term. We therefore believe Genco has created a compelling risk-reward balance positioning the Company to pay a sizeable quarterly dividend across diverse market environments. At the same time, we also maintain significant flexibility to grow the fleet through accretive vessel acquisitions. Key characteristics of our unique platform include:
- Industry low cash flow breakeven rate
- Net loan-to-value of
11% as of February 21, 2023 - Strong liquidity position of
$277.0 million consisting of cash and our undrawn revolver as of December 31, 2022 - High operating leverage with our scalable fleet across the major and minor bulk sectors
In 2022, Genco took the following steps in line with our corporate strategy:
- Dividends: declared dividends totaling
$2.57 per share for the twelve months of 2022 - Deleveraging: paid down
$75 million of debt in 2022. Since the beginning of 2021, we have paid down$278 million or62% of our debt - Growth: completed the acquisition of two high quality, fuel efficient Ultramax vessels in January 2022
- Securing revenue: opportunistically fixed various period time charterers to secure cash flows and de-risk recent acquisitions as shown in the following table:
| Vessel | Type | DWT | Year Built | Rate | Duration | Min Expiration | |
| Baltic Wolf | Capesize | 177,752 | 2010 | $ | 30,250 | 22-28 months | Jun-23 |
| Genco Maximus | Capesize | 169,025 | 2009 | $ | 27,500 | 24-30 months | Sep-23 |
| Genco Freedom | Ultramax | 63,671 | 2015 | $ | 23,375 | 20-23 months | Mar-23 |
| Baltic Scorpion | Ultramax | 63,462 | 2015 | $ | 30,500 | 10-13 months | Mar-23 |
| Baltic Hornet | Ultramax | 63,574 | 2014 | $ | 24,000 | 20-23 months | Apr-23 |
| Baltic Wasp | Ultramax | 63,389 | 2015 | $ | 25,500 | 23-25 months | Jun-23 |
| Genco Claudius | Capesize | 169,001 | 2010 | 11-14 months | Mar-23 | ||
| Genco Defender | Capesize | 180,021 | 2015 | 11-14 months | Mar-23 | ||
| Genco Endeavour | Capesize | 181,060 | 2015 | 11-14 months | Jan-24 | ||
| Genco Resolute | Capesize | 181,060 | 2015 | 11-14 months | Feb-24 | ||
Our debt outstanding as of December 31, 2022 was
Dividend Policy
For the fourth quarter of 2022, Genco declared a cash dividend of
Under the quarterly dividend policy adopted by our Board of Directors, the amount available for quarterly dividends is to be calculated based on the formula in the table below. The table includes the calculation of the actual Q4 2022 dividend and estimated amounts for the calculation of the dividend for Q1 2023:
| Dividend calculation | Q4 2022 actual | Q1 2023 estimates | |||
| Net revenue | $ | 76.01 | Fixtures + market | ||
| Operating expenses | (29.40 | ) | (33.79 | ) | |
| Operating cash flow | $ | 46.62 | |||
| Less: debt repayments | (8.75 | ) | (8.75 | ) | |
| Less: capex for dydocking/BWTS/ESDs | (5.51 | ) | (3.89 | ) | |
| Less: reserve | (10.75 | ) | (10.75 | ) | |
| Cash flow distributable as dividends | $ | 21.61 | Sum of the above | ||
| Number of shares to be paid dividends | 43.0 | 43.0 | |||
| Dividend per share | $ | 0.50 | |||
| Numbers in millions except per share amounts | |||||
The quarterly reserve for the first quarter of 2023 under the Company’s dividend formula is expected to be
For purposes of the foregoing calculation, operating cash flow is defined as net revenue (consisting of voyage revenue less voyage expenses, charter hire expenses, and realized gains or losses on fuel hedges), less operating expenses (consisting of vessel operating expenses, general and administrative expenses other than non-cash restricted stock expenses, technical management fees, and interest expense other than non-cash deferred financing costs).
Key Q4 2022 dividend items: during the fourth quarter of 2022, we paid down
Q1 2023 reserve: The quarterly reserve for the first quarter of 2023 is expected to be
The Board expects to reassess the payment of dividends as appropriate from time to time. Our quarterly dividend policy and declaration and payment of dividends are subject to legally available funds, compliance with applicable law and contractual obligations (including our credit facility) and the Board of Directors’ determination that each declaration and payment is at the time in the best interests of the Company and its shareholders after its review of our financial performance.
Genco’s Active Commercial Operating Platform and Fleet Deployment Strategy
We utilize a portfolio approach towards revenue generation through a combination of short-term, spot market employment as well as opportunistically booking longer term coverage. Our fleet deployment strategy currently remains weighted towards short-term fixtures, which provide us with optionality on our sizeable fleet. Our barbell approach towards fleet composition enables Genco to gain exposure to both the major and minor bulk commodities with a fleet whose cargoes carried align with global commodity trade flows. This approach continues to serve us well given the upside potential in major bulk rates together with the relative stability of minor bulk rates.
Based on current fixtures to date, our estimated TCE to date for the first quarter of 2023 on a load-to-discharge basis is presented below.
| Estimated net TCE - Q1 2023 to Date | |||||||
| Vessel Type | Period | Spot | Fleet-wide | % Fixed | |||
| Capesize | $ | 26,883 | $ | 13,205 | $ | 15,258 | |
| Ultramax/Supramax | $ | 24,020 | $ | 11,528 | $ | 13,610 | |
| Fleet-wide | $ | 25,005 | $ | 12,153 | $ | 14,217 | |
Given several of our vessels are on fixed rate period time charters, we have provided a TCE breakout of the period time charters as well as the spot trading fixtures in the first quarter to date. Actual rates for the first quarter will vary based upon future fixtures. We have approximately eight Capesize vessels coming open in the coming weeks, a portion of which we plan to ballast to the Atlantic basin.
Financial Review: 2022 Fourth Quarter
The Company recorded net income for the fourth quarter of 2022 of
The Company’s revenues decreased to
Voyage expenses were
Daily vessel operating expenses, or DVOE, amounted to
Apostolos Zafolias, Chief Financial Officer, commented, “During 2022, we continued to demonstrate our sizeable earnings power, generating
Financial Review: Twelve Months 2022
The Company recorded net income of
Liquidity and Capital Resources
Cash Flow
Net cash provided by operating activities for the years ended December 31, 2022 and 2021 was
Net cash used in investing activities during the years ended December 31, 2022 and 2021 was
Net cash used in financing activities during the years ended December 31, 2022 and 2021 was
Capital Expenditures
As of February 22, 2023, Genco Shipping & Trading Limited’s fleet consists of 17 Capesize, 15 Ultramax and 12 Supramax vessels with an aggregate capacity of approximately 4,635,000 dwt and an average age of 11.0 years.
In addition to acquisitions that we may undertake, we will incur additional capital expenditures due to special surveys and drydockings. Furthermore, we plan to upgrade a portion of our fleet with energy saving devices and apply high performance paint systems to our vessels in order to reduce fuel consumption and emissions. We estimate our capital expenditures related to drydocking, including capitalized costs incurred during drydocking related to vessel assets and vessel equipment, ballast water treatment system costs, fuel efficiency upgrades and scheduled off-hire days for our fleet for 2023 to be:
| Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | |
| Estimated Drydock Costs (1) | - | - | ||
| Estimated BWTS Costs (2) | - | - | - | |
| Estimated Fuel Efficiency Upgrade Costs (3) | - | - | ||
| Total Estimated Costs | - | - | ||
| Estimated Offhire Days (4) | 65 | 139 | - | - |
(1) Estimates are based on our budgeted cost of drydocking our vessels in China. Actual costs will vary based on various factors, including where the drydockings are actually performed. We expect to fund these costs with cash on hand. These costs do not include drydock expense items that are reflected in vessel operating expenses.
(2) Estimated costs associated with the installation of ballast water treatment systems are expected to be funded with cash on hand.
(3) Estimated costs associated with the installation of fuel efficiency upgrades are expected to be funded with cash on hand.
(4) Actual length will vary based on the condition of the vessel, yard schedules and other factors. The estimated offhire days per sector scheduled for Q1 2023 consists of 65 days for one Capesize vessel.
Summary Consolidated Financial and Other Data
The following table summarizes Genco Shipping & Trading Limited’s selected consolidated financial and other data for the periods indicated below.
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | Twelve Months Ended December 31, 2022 | Twelve Months Ended December 31, 2021 | |||||||||||||||
| (Dollars in thousands, except share and per share data) | (Dollars in thousands, except share and per share data) | |||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||
| INCOME STATEMENT DATA: | ||||||||||||||||||
| Revenues: | ||||||||||||||||||
| Voyage revenues | $ | 126,973 | $ | 183,277 | $ | 536,934 | $ | 547,129 | ||||||||||
| Total revenues | 126,973 | 183,277 | 536,934 | 547,129 | ||||||||||||||
| Operating expenses: | ||||||||||||||||||
| Voyage expenses | 43,470 | 36,610 | 153,889 | 146,182 | ||||||||||||||
| Vessel operating expenses | 20,902 | 22,467 | 99,469 | 82,089 | ||||||||||||||
| Charter hire expenses | 7,497 | 13,964 | 27,130 | 36,370 | ||||||||||||||
| General and administrative expenses (inclusive of nonvested stock amortization | 7,372 | 6,838 | 25,708 | 24,454 | ||||||||||||||
| expense of | ||||||||||||||||||
| Technical management fees | 932 | 1,213 | 3,310 | 5,612 | ||||||||||||||
| Depreciation and amortization | 16,028 | 14,822 | 60,190 | 56,231 | ||||||||||||||
| Gain on sale of vessels | - | (5,818 | ) | - | (4,924 | ) | ||||||||||||
| Total operating expenses | 96,201 | 90,096 | 369,696 | 346,014 | ||||||||||||||
| Operating income | 30,772 | 93,181 | 167,238 | 201,115 | ||||||||||||||
| Other (expense) income: | ||||||||||||||||||
| Other (expense) income | (439 | ) | 101 | 178 | 541 | |||||||||||||
| Interest income | 666 | 10 | 1,042 | 154 | ||||||||||||||
| Interest expense | (2,171 | ) | (2,402 | ) | (9,094 | ) | (15,357 | ) | ||||||||||
| Loss on debt extinguishment | - | - | - | (4,408 | ) | |||||||||||||
| Other expense, net | (1,944 | ) | (2,291 | ) | (7,874 | ) | (19,070 | ) | ||||||||||
| Net income | $ | 28,828 | $ | 90,890 | $ | 159,364 | $ | 182,045 | ||||||||||
| Less: Net income attributable to noncontrolling interest | 149 | 38 | 788 | $ | 38 | |||||||||||||
| Net income attributable to Genco Shipping & Trading Limited | $ | 28,679 | $ | 90,852 | $ | 158,576 | $ | 182,007 | ||||||||||
| Earnings per share - basic | $ | 0.67 | $ | 2.16 | $ | 3.74 | $ | 4.33 | ||||||||||
| Earnings per share - diluted | $ | 0.67 | $ | 2.13 | $ | 3.70 | $ | 4.27 | ||||||||||
| Weighted average common shares outstanding - basic | 42,563,836 | 42,102,187 | 42,412,722 | 42,060,996 | ||||||||||||||
| Weighted average common shares outstanding - diluted | 42,916,252 | 42,709,594 | 42,915,496 | 42,588,871 | ||||||||||||||
| December 31, 2022 | December 31, 2021 | |||||||||||
| BALANCE SHEET DATA (Dollars in thousands): | (unaudited) | |||||||||||
| Assets | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 58,142 | $ | 114,573 | ||||||||
| Restricted cash | 5,643 | 5,643 | ||||||||||
| Due from charterers, net | 25,333 | 20,116 | ||||||||||
| Prepaid expenses and other current assets | 8,399 | 9,935 | ||||||||||
| Inventories | 21,601 | 24,563 | ||||||||||
| Fair value of derivative instruments | 6,312 | - | ||||||||||
| Total current assets | 125,430 | 174,830 | ||||||||||
| Noncurrent assets: | ||||||||||||
| Vessels, net of accumulated depreciation of | 1,002,810 | 981,141 | ||||||||||
| Deposits on vessels | - | 18,543 | ||||||||||
| Deferred drydock, net | 32,254 | 14,275 | ||||||||||
| Fixed assets, net | 8,556 | 7,237 | ||||||||||
| Operating lease right-of-use assets | 4,078 | 5,495 | ||||||||||
| Restricted cash | 315 | 315 | ||||||||||
| Fair value of derivative instruments | 423 | 1,166 | ||||||||||
| Total noncurrent assets | 1,048,436 | 1,028,172 | ||||||||||
| Total assets | $ | 1,173,866 | $ | 1,203,002 | ||||||||
| Liabilities and Equity | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable and accrued expenses | $ | 29,475 | $ | 29,956 | ||||||||
| Deferred revenue | 4,958 | 10,081 | ||||||||||
| Current operating lease liabilities | 2,107 | 1,858 | ||||||||||
| Total current liabilities | 36,540 | 41,895 | ||||||||||
| Noncurrent liabilities | ||||||||||||
| Long-term operating lease liabilities | 4,096 | 6,203 | ||||||||||
| Long-term debt, net of deferred financing costs of | 164,921 | 238,229 | ||||||||||
| Total noncurrent liabilities | 169,017 | 244,432 | ||||||||||
| Total liabilities | 205,557 | 286,327 | ||||||||||
| Commitments and contingencies | ||||||||||||
| Equity: | ||||||||||||
| Common stock | 423 | 419 | ||||||||||
| Additional paid-in capital | 1,588,777 | 1,702,166 | ||||||||||
| Accumulated other comprehensive income | 6,480 | 825 | ||||||||||
| Accumulated deficit | (628,247 | ) | (786,823 | ) | ||||||||
| Total Genco Shipping & Trading Limited shareholders' equity | 967,433 | 916,587 | ||||||||||
| Noncontrolling interest | 876 | 88 | ||||||||||
| Total equity | 968,309 | 916,675 | ||||||||||
| Total liabilities and equity | $ | 1,173,866 | $ | 1,203,002 | ||||||||
| Twelve Months Ended December 31, 2022 | Twelve Months Ended December 31, 2021 | |||||||||||
| STATEMENT OF CASH FLOWS (Dollars in thousands): | (unaudited) | |||||||||||
| Cash flows from operating activities | ||||||||||||
| Net income | $ | 159,364 | $ | 182,045 | ||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization | 60,190 | 56,231 | ||||||||||
| Amortization of deferred financing costs | 1,694 | 3,536 | ||||||||||
| Amortization of fair market value of time charters acquired | - | (4,263 | ) | |||||||||
| Right-of-use asset amortization | 1,417 | 1,387 | ||||||||||
| Amortization of nonvested stock compensation expense | 3,242 | 2,267 | ||||||||||
| Gain on sale of vessels | - | (4,924 | ) | |||||||||
| Loss on debt extinguishment | - | 4,408 | ||||||||||
| Amortization of premium on derivative | 86 | 197 | ||||||||||
| Interest rate cap premium payment | - | (240 | ) | |||||||||
| Insurance proceeds for protection and indemnity claims | 829 | 988 | ||||||||||
| Change in assets and liabilities: | ||||||||||||
| Increase in due from charterers | (5,217 | ) | (7,125 | ) | ||||||||
| Increase in prepaid expenses and other current assets | (317 | ) | (783 | ) | ||||||||
| Decrease (increase) in inventories | 2,962 | (2,980 | ) | |||||||||
| (Decrease) increase in accounts payable and accrued expenses | (2,134 | ) | 5,405 | |||||||||
| (Decrease) increase in deferred revenue | (5,123 | ) | 1,660 | |||||||||
| Decrease in operating lease liabilities | (1,858 | ) | (1,765 | ) | ||||||||
| Deferred drydock costs incurred | (25,812 | ) | (4,925 | ) | ||||||||
| Net cash provided by operating activities | 189,323 | 231,119 | ||||||||||
| Cash flows from investing activities | ||||||||||||
| Purchase of vessels and ballast water treatment systems, including deposits | (52,473 | ) | (115,680 | ) | ||||||||
| Purchase of scrubbers (capitalized in Vessels) | - | (199 | ) | |||||||||
| Purchase of other fixed assets | (3,566 | ) | (1,585 | ) | ||||||||
| Net proceeds from sale of vessels | - | 49,473 | ||||||||||
| Insurance proceeds for hull and machinery claims | 1,024 | 418 | ||||||||||
| Net cash used in investing activities | (55,015 | ) | (67,573 | ) | ||||||||
| Cash flows from financing activities | ||||||||||||
| Proceeds from the | - | 350,000 | ||||||||||
| Repayments on the | (75,000 | ) | (104,000 | ) | ||||||||
| Repayments on the | - | (114,940 | ) | |||||||||
| Repayments on the | - | (334,288 | ) | |||||||||
| Investment by non-controlling interest | - | 50 | ||||||||||
| Cash dividends paid | (115,728 | ) | (13,463 | ) | ||||||||
| Payment of deferred financing costs | (11 | ) | (6,053 | ) | ||||||||
| Net cash used in financing activities | (190,739 | ) | (222,694 | ) | ||||||||
| Net decrease in cash, cash equivalents and restricted cash | (56,431 | ) | (59,148 | ) | ||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 120,531 | 179,679 | ||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 64,100 | $ | 120,531 | ||||||||
| Three Months Ended December 31, 2022 | ||||||||
| Net Income Reconciliation | (unaudited) | |||||||
| Net income attributable to Genco Shipping & Trading Limited | $ | 28,679 | ||||||
| + | Unrealized gain on fuel hedges | (115 | ) | |||||
| Adjusted net income | $ | 28,564 | ||||||
| Earnings per share - basic | $ | 0.67 | ||||||
| Earnings per share - diluted | $ | 0.67 | ||||||
| Weighted average common shares outstanding - basic | 42,563,836 | |||||||
| Weighted average common shares outstanding - diluted | 42,916,252 | |||||||
| Weighted average common shares outstanding - basic as per financial statements | 42,563,836 | |||||||
| Dilutive effect of stock options | 180,297 | |||||||
| Dilutive effect of restricted stock units | 172,119 | |||||||
| Weighted average common shares outstanding - diluted as adjusted | 42,916,252 | |||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | Twelve Months Ended December 31, 2022 | Twelve Months Ended December 31, 2021 | |||||||||||||||
| (Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||
| EBITDA Reconciliation: | (unaudited) | (unaudited) | ||||||||||||||||
| Net income attributable to Genco Shipping & Trading Limited | $ | 28,679 | $ | 90,852 | $ | 158,576 | $ | 182,007 | ||||||||||
| + | Net interest expense | 1,505 | 2,392 | 8,052 | 15,203 | |||||||||||||
| + | Depreciation and amortization | 16,028 | 14,822 | 60,190 | 56,231 | |||||||||||||
| EBITDA(1) | $ | 46,212 | $ | 108,066 | $ | 226,818 | $ | 253,441 | ||||||||||
| + | Gain on sale of vessels | - | (5,818 | ) | - | (4,924 | ) | |||||||||||
| + | Loss on debt extinguishment | - | - | - | 4,408 | |||||||||||||
| + | Unrealized (gain) loss on fuel hedges | (115 | ) | 47 | (4 | ) | (34 | ) | ||||||||||
| Adjusted EBITDA | $ | 46,097 | $ | 102,295 | $ | 226,814 | $ | 252,891 | ||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||
| December 31, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| FLEET DATA: | (unaudited) | (unaudited) | ||||||||||||||||
| Total number of vessels at end of period | 44 | 42 | 44 | 42 | ||||||||||||||
| Average number of vessels (2) | 44.0 | 42.4 | 44.0 | 41.6 | ||||||||||||||
| Total ownership days for fleet (3) | 4,048 | 3,897 | 16,050 | 15,177 | ||||||||||||||
| Total chartered-in days (4) | 303 | 352 | 1,062 | 1,472 | ||||||||||||||
| Total available days for fleet (5) | 4,235 | 4,122 | 16,070 | 16,412 | ||||||||||||||
| Total available days for owned fleet (6) | 3,932 | 3,770 | 15,008 | 14,940 | ||||||||||||||
| Total operating days for fleet (7) | 4,139 | 4,060 | 15,741 | 16,165 | ||||||||||||||
| Fleet utilization (8) | 97.3 | % | 97.4 | % | 96.5 | % | 97.9 | % | ||||||||||
| AVERAGE DAILY RESULTS: | ||||||||||||||||||
| Time charter equivalent (9) | $ | 19,330 | $ | 35,200 | $ | 23,824 | $ | 24,402 | ||||||||||
| Daily vessel operating expenses per vessel (10) | 5,164 | 5,766 | 6,197 | 5,409 | ||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||
| December 31, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| FLEET DATA: | (unaudited) | (unaudited) | ||||||||||||||||
| Ownership days | ||||||||||||||||||
| Capesize | 1,564.0 | 1,564.0 | 6,205.0 | 6,205.0 | ||||||||||||||
| Ultramax | 1,380.0 | 1,196.0 | 5,464.9 | 3,716.8 | ||||||||||||||
| Supramax | 1,104.0 | 1,136.7 | 4,380.0 | 5,027.2 | ||||||||||||||
| Handysize | - | - | - | 227.5 | ||||||||||||||
| Total | 4,048.0 | 3,896.7 | 16,049.9 | 15,176.5 | ||||||||||||||
| Chartered-in days | ||||||||||||||||||
| Capesize | - | - | - | - | ||||||||||||||
| Ultramax | 172.3 | 62.6 | 476.8 | 450.1 | ||||||||||||||
| Supramax | 130.7 | 247.6 | 584.9 | 979.9 | ||||||||||||||
| Handysize | - | 42.2 | - | 42.2 | ||||||||||||||
| Total | 303.0 | 352.4 | 1,061.7 | 1,472.2 | ||||||||||||||
| Available days (owned & chartered-in fleet) | ||||||||||||||||||
| Capesize | 1,493.3 | 1,535.2 | 5,458.2 | 6,118.6 | ||||||||||||||
| Ultramax | 1,518.2 | 1,194.5 | 5,793.5 | 4,079.2 | ||||||||||||||
| Supramax | 1,223.8 | 1,350.4 | 4,817.8 | 5,944.9 | ||||||||||||||
| Handysize | - | 42.2 | - | 269.8 | ||||||||||||||
| Total | 4,235.4 | 4,122.3 | 16,069.5 | 16,412.5 | ||||||||||||||
| Available days (owned fleet) | ||||||||||||||||||
| Capesize | 1,493.3 | 1,535.2 | 5,458.2 | 6,118.6 | ||||||||||||||
| Ultramax | 1,346.0 | 1,131.9 | 5,316.7 | 3,629.1 | ||||||||||||||
| Supramax | 1,093.1 | 1,102.8 | 4,232.9 | 4,965.0 | ||||||||||||||
| Handysize | - | - | - | 227.6 | ||||||||||||||
| Total | 3,932.4 | 3,769.9 | 15,007.8 | 14,940.3 | ||||||||||||||
| Operating days | ||||||||||||||||||
| Capesize | 1,454.2 | 1,530.9 | 5,329.2 | 6,080.1 | ||||||||||||||
| Ultramax | 1,498.3 | 1,163.4 | 5,730.0 | 4,015.2 | ||||||||||||||
| Supramax | 1,186.0 | 1,323.4 | 4,681.6 | 5,835.7 | ||||||||||||||
| Handysize | - | 42.2 | - | 233.5 | ||||||||||||||
| Total | 4,138.5 | 4,060.1 | 15,740.8 | 16,164.5 | ||||||||||||||
| Fleet utilization | ||||||||||||||||||
| Capesize | 97.0 | % | 97.9 | % | 96.8 | % | 98.8 | % | ||||||||||
| Ultramax | 98.5 | % | 96.6 | % | 97.7 | % | 97.6 | % | ||||||||||
| Supramax | 96.1 | % | 97.5 | % | 94.7 | % | 97.6 | % | ||||||||||
| Handysize | - | 100.0 | % | - | 86.6 | % | ||||||||||||
| Fleet average | 97.3 | % | 97.4 | % | 96.5 | % | 97.9 | % | ||||||||||
| Average Daily Results: | ||||||||||||||||||
| Time Charter Equivalent | ||||||||||||||||||
| Capesize | $ | 19,928 | $ | 40,620 | $ | 22,492 | $ | 27,293 | ||||||||||
| Ultramax | 21,980 | 30,581 | 25,945 | 22,169 | ||||||||||||||
| Supramax | 15,245 | 32,455 | 22,873 | 23,235 | ||||||||||||||
| Handysize | - | - | - | 8,116 | ||||||||||||||
| Fleet average | 19,330 | 35,200 | 23,824 | 24,402 | ||||||||||||||
| Daily vessel operating expenses | ||||||||||||||||||
| Capesize | $ | 5,354 | $ | 5,519 | $ | 6,023 | $ | 5,572 | ||||||||||
| Ultramax | 4,682 | 4,783 | 5,450 | 5,062 | ||||||||||||||
| Supramax | 5,495 | 7,091 | 7,382 | 5,443 | ||||||||||||||
| Handysize | - | - | - | 5,856 | ||||||||||||||
| Fleet average | 5,164 | 5,766 | 6,197 | 5,409 | ||||||||||||||
1) EBITDA represents net income attributable to Genco Shipping & Trading Limited plus net interest expense, taxes, and depreciation and amortization. EBITDA is included because it is used by management and certain investors as a measure of operating performance. EBITDA is used by analysts in the shipping industry as a common performance measure to compare results across peers. Our management uses EBITDA as a performance measure in consolidating internal financial statements and it is presented for review at our board meetings. We believe that EBITDA is useful to investors as the shipping industry is capital intensive which often results in significant depreciation and cost of financing. EBITDA presents investors with a measure in addition to net income to evaluate our performance prior to these costs. EBITDA is not an item recognized by U.S. GAAP (i.e. non-GAAP measure) and should not be considered as an alternative to net income, operating income or any other indicator of a company's operating performance required by U.S. GAAP. EBITDA is not a measure of liquidity or cash flows as shown in our consolidated statement of cash flows. The definition of EBITDA used here may not be comparable to that used by other companies.
2) Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was part of our fleet during the period divided by the number of calendar days in that period.
3) We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.
4) We define chartered-in days as the aggregate number of days in a period during which we chartered-in third-party vessels.
5) We define available days as the number of our ownership days and chartered-in days less the aggregate number of days that our vessels are off-hire due to familiarization upon acquisition, repairs or repairs under guarantee, vessel upgrades or special surveys. Companies in the shipping industry generally use available days to measure the number of days in a period during which vessels should be capable of generating revenues.
6) We define available days for the owned fleet as available days less chartered-in days.
7) We define operating days as the number of our total available days in a period less the aggregate number of days that the vessels are off-hire due to unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
8) We calculate fleet utilization as the number of our operating days during a period divided by the number of ownership days plus chartered-in days less drydocking days.
9) We define TCE rates as our voyage revenues less voyage expenses, charter hire expenses, and realized gain or losses on fuel hedges, divided by the number of the available days of our owned fleet during the period. TCE rate 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 charterhire rates for vessels on voyage charters are generally not expressed in per-day amounts while charterhire rates for vessels on time charters generally are expressed in such amounts. Our estimated TCE for the first quarter of 2023 is based on fixtures booked to date. Actual results may vary based on the actual duration of voyages and other factors. Accordingly, we are unable to provide, without unreasonable efforts, a reconciliation of estimated TCE for the first quarter to the most comparable financial measures presented in accordance with GAAP. When we compare our TCE to the Baltic Supramax Index (BSI) in this release, we adjust the BSI for customary commissions.
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | Twelve Months Ended December 31, 2022 | Twelve Months Ended December 31, 2021 | |||||||||||
| Total Fleet | (unaudited) | (unaudited) | ||||||||||||
| Voyage revenues (in thousands) | $ | 126,973 | $ | 183,277 | $ | 536,934 | $ | 547,129 | ||||||
| Voyage expenses (in thousands) | 43,470 | 36,610 | 153,889 | 146,182 | ||||||||||
| Charter hire expenses (in thousands) | 7,497 | 13,964 | 27,130 | 36,370 | ||||||||||
| Realized gain on fuel hedges (in thousands) | 9 | - | 1,631 | - | ||||||||||
| 76,015 | 132,703 | 357,546 | 364,577 | |||||||||||
| Total available days for owned fleet | 3,932 | 3,770 | 15,008 | 14,940 | ||||||||||
| Total TCE rate | $ | 19,330 | $ | 35,200 | $ | 23,824 | $ | 24,402 | ||||||
10) We define daily vessel operating expenses to include crew wages and related costs, the cost of insurance expenses relating to repairs and maintenance (excluding drydocking), the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses. Daily vessel operating expenses are calculated by dividing vessel operating expenses by ownership days for the relevant period.
About Genco Shipping & Trading Limited
Genco Shipping & Trading Limited is a U.S. based drybulk ship owning company focused on the seaborne transportation of commodities globally. We provide a full-service logistics solution to our customers utilizing our in-house commercial operating platform, as we transport key cargoes such as iron ore, grain, steel products, bauxite, cement, nickel ore among other commodities along worldwide shipping routes. Our wholly owned high quality, modern fleet of dry cargo vessels consists of the larger Capesize (major bulk) and the medium-sized Ultramax and Supramax vessels (minor bulk) enabling us to carry a wide range of cargoes. We make capital expenditures from time to time in connection with vessel acquisitions. As of February 22, 2023, Genco Shipping & Trading Limited’s fleet consists of 17 Capesize, 15 Ultramax and 12 Supramax vessels with an aggregate capacity of approximately 4,635,000 dwt and an average age of 11.0 years.
The following table reflects Genco’s fleet list as of February 22, 2023:
| Vessel | DWT | Year Built | |||
| Capesize | |||||
| 1 | Genco Resolute | 181,060 | 2015 | ||
| 2 | Genco Endeavour | 181,060 | 2015 | ||
| 3 | Genco Constantine | 180,183 | 2008 | ||
| 4 | Genco Augustus | 180,151 | 2007 | ||
| 5 | Genco Liberty | 180,032 | 2016 | ||
| 6 | Genco Defender | 180,021 | 2016 | ||
| 7 | Genco Lion | 179,185 | 2012 | ||
| 8 | Genco Tiger | 179,185 | 2011 | ||
| 9 | Genco London | 177,833 | 2007 | ||
| 10 | Baltic Wolf | 177,752 | 2010 | ||
| 11 | Genco Titus | 177,729 | 2007 | ||
| 12 | Baltic Bear | 177,717 | 2010 | ||
| 13 | Genco Tiberius | 175,874 | 2007 | ||
| 14 | Genco Commodus | 169,098 | 2009 | ||
| 15 | Genco Hadrian | 169,025 | 2008 | ||
| 16 | Genco Maximus | 169,025 | 2009 | ||
| 17 | Genco Claudius | 169,001 | 2010 | ||
| Ultramax | |||||
| 1 | Genco Freedom | 63,671 | 2015 | ||
| 2 | Baltic Hornet | 63,574 | 2014 | ||
| 3 | Genco Vigilant | 63,498 | 2015 | ||
| 4 | Genco Enterprise | 63,473 | 2016 | ||
| 5 | Baltic Mantis | 63,470 | 2015 | ||
| 6 | Baltic Scorpion | 63,462 | 2015 | ||
| 7 | Genco Magic | 63,446 | 2014 | ||
| 8 | Baltic Wasp | 63,389 | 2015 | ||
| 9 | Genco Constellation | 63,310 | 2017 | ||
| 10 | Genco Mayflower | 63,304 | 2017 | ||
| 11 | Genco Madeleine | 63,166 | 2014 | ||
| 12 | Genco Weatherly | 61,556 | 2014 | ||
| 13 | Genco Mary | 61,085 | 2022 | ||
| 14 | Genco Laddey | 61,085 | 2022 | ||
| 15 | Genco Columbia | 60,294 | 2016 | ||
| Supramax | |||||
| 1 | Genco Hunter | 58,729 | 2007 | ||
| 2 | Genco Auvergne | 58,020 | 2009 | ||
| 3 | Genco Rhone | 58,018 | 2011 | ||
| 4 | Genco Ardennes | 58,018 | 2009 | ||
| 5 | Genco Brittany | 58,018 | 2010 | ||
| 6 | Genco Languedoc | 58,018 | 2010 | ||
| 7 | Genco Pyrenees | 58,018 | 2010 | ||
| 8 | Genco Bourgogne | 58,018 | 2010 | ||
| 9 | Genco Aquitaine | 57,981 | 2009 | ||
| 10 | Genco Warrior | 55,435 | 2005 | ||
| 11 | Genco Predator | 55,407 | 2005 | ||
| 12 | Genco Picardy | 55,257 | 2005 | ||
Conference Call Announcement
Genco Shipping & Trading Limited will hold a conference call on Thursday,
February 23, 2023 at 8:30 a.m. Eastern Time to discuss its 2022 fourth quarter financial results. The conference call and a presentation will be simultaneously webcast and will be available on the Company’s website, www.GencoShipping.com. To access the conference call, dial (514) 316-5035 or (888) 886-7786 and enter passcode 32378900. A replay of the conference call can also be accessed for two weeks by dialing (877) 674-7070 and entering the passcode 378900. The Company intends to place additional materials related to the earnings announcement, including a slide presentation, on its website prior to the conference call.
Website Information
We intend to use our website, www.GencoShipping.com, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included in our website’s Investor Relations section. Accordingly, investors should monitor the Investor Relations portion of our website, in addition to following our press releases, SEC filings, public conference calls, and webcasts. To subscribe to our e-mail alert service, please click the “Receive E-mail Alerts” link in the Investor Relations section of our website and submit your email address. The information contained in, or that may be accessed through, our website is not incorporated by reference into or a part of this document or any other report or document we file with or furnish to the SEC, and any references to our website are intended to be inactive textual references only.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as “anticipate,” “budget,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of potential future events, circumstances or future operating or financial performance. These forward-looking statements are based on our management’s current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this release are the following: (i) declines or sustained weakness in demand in the drybulk shipping industry; (ii) weakness or declines in drybulk shipping rates; (iii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iv) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (v) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (vi) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, lube oil, bunkers, repairs, maintenance, general and administrative expenses, and management fee expenses; (vii) whether our insurance arrangements are adequate; (viii) changes in general domestic and international political conditions; (ix) acts of war, terrorism, or piracy, including without limitation the ongoing war in Ukraine; (x) changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (xi) the Company’s acquisition or disposition of vessels; (xii) the amount of offhire time needed to complete maintenance, repairs, and installation of equipment to comply with applicable regulations on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims, including offhire days; (xiii) the completion of definitive documentation with respect to charters; (xiv) charterers’ compliance with the terms of their charters in the current market environment; (xv) the extent to which our operating results are affected by weakness in market conditions and freight and charter rates; (xvi) our ability to maintain contracts that are critical to our operation, to obtain and maintain acceptable terms with our vendors, customers and service providers and to retain key executives, managers and employees; (xvii) completion of documentation for vessel transactions and the performance of the terms thereof by buyers or sellers of vessels and us; (xviii) the relative cost and availability of low sulfur and high sulfur fuel, worldwide compliance with sulfur emissions regulations that took effect on January 1, 2020 and our ability to realize the economic benefits or recover the cost of the scrubbers we have installed; (xix) our financial results for the year ending December 31, 2023 and other factors relating to determination of the tax treatment of dividends we have declared; (xx) the financial results we achieve for each quarter that apply to the formula under our new dividend policy, including without limitation the actual amounts earned by our vessels and the amounts of various expenses we incur, as a significant decrease in such earnings or a significant increase in such expenses may affect our ability to carry out our new value strategy; (xxi) the exercise of the discretion of our Board regarding the declaration of dividends, including without limitation the amount that our Board determines to set aside for reserves under our dividend policy; (xxii) the duration and impact of the COVID-19 novel coronavirus epidemic, which may negatively affect general global and regional economic conditions, our ability to charter our vessels at all and the rates at which are able to do so; our ability to call on or depart from ports on a timely basis or at all; our ability to crew, maintain, and repair our vessels, including without limitation the impact diversion of our vessels to perform crew rotations may have on our revenues, expenses, and ability to consummate vessel sales, expense and disruption to our operations that may arise from the inability to rotate crews on schedule, and delay and added expense we may incur in rotating crews in the current environment; our ability to staff and maintain our headquarters and administrative operations; sources of cash and liquidity; our ability to sell vessels in the secondary market, including without limitation the compliance of purchasers and us with the terms of vessel sale contracts, and the prices at which vessels are sold; and other factors relevant to our business described from time to time in our filings with the Securities and Exchange Commission; and (xxiii) other factors listed from time to time in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2022 and subsequent reports on Form 8-K and Form 10-Q). Our ability to pay dividends in any period will depend upon various factors, including the limitations under any credit agreements to which we may be a party, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance, market developments, and the best interests of the Company and its shareholders. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
CONTACT:
Apostolos Zafolias
Chief Financial Officer
Genco Shipping & Trading Limited
(646) 443-8550
FAQ
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