Safe Bulkers, Inc. Reports Fourth Quarter and Twelve Months 2020 Results
Safe Bulkers, Inc. (NYSE: SB) reported its unaudited financial results for Q4 2020, showcasing net revenues of $52.2 million, slightly down from $53.2 million in Q4 2019. The company achieved a net income of $7.6 million, a significant recovery compared to a loss of $13.9 million in Q2 2020. Adjusted EBITDA reached $226.3 million. Despite challenges from the COVID-19 pandemic affecting charter rates and operational costs, Safe Bulkers remains committed to fleet renewal. The company has liquidity of $184.3 million and is positioned to leverage a strengthening charter market.
- Net income improved to $7.6 million in Q4 2020, recovering from previous losses.
- Adjusted EBITDA reached $226.3 million, indicating strong operational performance.
- Liquidity increased to $184.3 million, providing a solid financial foundation.
- Completed acquisition agreements for new, energy-efficient vessels set for delivery in 2022.
- Net revenues declined by 2% compared to Q4 2019 due to weaker TCE rates.
- COVID-19 pandemic had a negative impact on demand and operational costs.
MONACO, Feb. 15, 2021 (GLOBE NEWSWIRE) -- Safe Bulkers, Inc. (the “Company”) (NYSE: SB), an international provider of marine drybulk transportation services, announced today its unaudited financial results for the three and twelve months period ended December 31, 2020.
| Financial highlights | ||||||||||||||
| In million U.S. Dollars except per share data | Q4 2020 | Q3 2020 | Q2 2020 | Q1 2020 | Q4 2019 | Twelve Months 2020 | Twelve Months 2019 | |||||||
| Net Revenues | 52.2 | 51.9 | 48.3 | 45.7 | 53.2 | 198.2 | 197.8 | |||||||
| Net income/(loss) | 7.6 | 3.3 | (13.9 | ) | (9.9 | ) | 3.6 | (12.9 | ) | 16.0 | ||||
| Adjusted Net income/(loss)1 | 7.7 | 3.5 | (13.3 | ) | (10.2 | ) | 3.5 | (12.3 | ) | 16.7 | ||||
| EBITDA2 | 26.2 | 22.1 | 5.7 | 9.7 | 23.1 | 63.7 | 93.5 | |||||||
| Adjusted EBITDA 2 | 26.3 | 22.3 | 6.3 | 9.4 | 23.1 | 64.3 | 94.1 | |||||||
| Earnings/(loss) per share basic and diluted3 | 0.04 | 0.00 | (0.16 | ) | (0.12 | ) | 0.01 | (0.25 | ) | 0.04 | ||||
| Adjusted earnings/(loss) per share basic and diluted 3 | 0.04 | 0.00 | (0.16 | ) | (0.13 | ) | 0.01 | (0.24 | ) | 0.05 | ||||
| Average Daily results in U.S. Dollars | ||||||||||||||
| Time charter equivalent rate4 | 12,319 | 12,575 | 8,094 | 9,089 | 13,707 | 10,559 | 12,805 | |||||||
| Daily vessel operating expenses5 | 3,978 | 4,896 | 4,729 | 4,771 | 5,103 | 4,591 | 4,582 | |||||||
| Daily vessel operating expenses excluding dry-docking and pre-delivery expenses6 | 3,955 | 4,459 | 4,207 | 4,285 | 4,540 | 4,226 | 4,257 | |||||||
| Daily general and administrative expenses7 | 1,469 | 1,418 | 1,374 | 1,371 | 1,414 | 1,408 | 1,379 | |||||||
| In million U.S. Dollars | ||||||||||||||
| Total Cash8 | 124.0 | 106.7 | 118.8 | 109.3 | 120.1 | |||||||||
| Liquidity9 | 171.2 | 109.7 | 119.8 | 145.7 | 178.0 | |||||||||
| Total Debt10 | 607.7 | 608.9 | 625.4 | 605.2 | 601.0 | |||||||||
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1 Adjusted Net income/(loss) is a non-GAAP measure. Adjusted Net income/(loss) represents Net income/(loss) before gain/(loss) on derivatives, early redelivery cost, loss on inventory valuation and gain/(loss) on foreign currency. See Table 4.
2 EBITDA is a non-GAAP measure and represents Net income/(loss) plus net interest expense, tax, depreciation and amortization. See Table 4. Adjusted EBITDA is a non-GAAP measure and represents EBITDA before gain/(loss) on derivatives, early redelivery cost, loss on inventory valuation and, gain/(loss) on foreign currency. See Table 4.
3 Earnings/(loss) per share and Adjusted Earnings/(loss) per share represent Net Income and Adjusted Net income less preferred dividend and mezzanine equity measurement divided by the weighted average number of shares respectively. See Table 4.
4 Time charter equivalent rate, or TCE rate, represents revenues less commissions and voyage expenses divided by the number of available days. See Table 5.
5 Daily vessel operating expenses are calculated by dividing vessel operating expenses for the relevant period by ownership days for such period. See Table 5.
6 Daily vessel operating expenses excluding dry-docking and pre-delivery expenses are calculated by dividing vessel operating expenses excluding dry-docking and pre-delivery expenses for the relevant period by ownership days for such period. See Table 5.
7 Daily general and administrative expenses are calculated by dividing general and administrative expenses for the relevant period by ownership days for such period. See Table 5.
8 Total Cash represents Cash and cash equivalents plus Time deposits and Restricted cash.
9 Liquidity represents Total Cash plus contracted undrawn borrowing capacity under revolving credit facilities and secured commitments including sale and lease back financing.
10 Total Debt represents Long-term debt plus Current portion of long-term debt, net of deferred financing costs.
Management Commentary
Dr. Loukas Barmparis, President of the Company, said: ''Having a consistent strategy for fleet renewal and environmental upgrading, hands on operations and strong balance sheet, we believe we are well positioned to take advantage of a strengthening charter market.''
Update on COVID-19, Company's actions and status
There has been a negative effect from the COVID-19 pandemic on the Company's results of operations and financial condition year to date, due to lower demand which resulted in relatively lower charter rates, and higher crew and related costs. Any future impact of COVID-19 on the Company’s results of operations and financial condition and any long-term impact of the pandemic on the dry bulk industry, will depend on future developments, which are highly uncertain and cannot be predicted, including any potential third wave of the pandemic and any new potential restrictions imposed as a result of the virus, new information which may emerge concerning the severity of the virus and/or actions taken to contain or treat its impact, including distribution and effectiveness of the vaccines, as well as political implications that could further impact world trade and global growth.
The COVID-19 pandemic had significant impact on the shipping industry and our seafarers as port lockdowns were imposed globally in 2020 and certain ports that have since reopened have subsequently closed again for crew changes. The Company has worked extensively to find solutions focusing on effectively managing crew changes despite the ongoing port closures and travel restrictions imposed by governments around the world. The Company has also taken measures to protect its seafarers' and shore employees' health and well-being, keep its vessels sailing with minimal disruption to their trading ability, service its charterers and mitigate and address the risks, effects and impact of COVID-19 on our operations and financial performance.
At-the-market equity offering program
In August 2020, the Company filed a prospectus supplement with the Securities and Exchange Commission (“SEC”), under which it may offer and sell shares of its common stock (“Shares”) from time to time for up to aggregate gross offering proceeds of
Chartering our fleet
Our vessels are used to transport bulk cargoes, particularly coal, grain and iron ore, along worldwide shipping routes. We intend to employ our vessels on both period time charters and spot time charters, according to our assessment of market conditions. Our customers represent some of the world’s largest consumers of marine drybulk transportation services. The vessels we deploy on period time charters provide us with visible and relatively stable cash flow, while the vessels we deploy in the spot market allow us to maintain our flexibility in low charter market conditions and provide an opportunity for a potential upside in our revenue when charter market conditions improve.
In December 2020, the Company agreed the early termination of an existing charter of the Capesize-class vessel MV Lake Despina, which was contractually due to expire in January 2024. In exchange for the early redelivery of the vessel, the charterer paid the Company cash compensation of about
During the fourth quarter of 2020, we operated 42.00 vessels on average earning a TCE11 of
Table 1: Contracted employment profile of fleet ownership days as of February 12, 2021
| 2021 (remaining) | 43 | % |
| 2021 (full year) | 49 | % |
| 2022 | 18 | % |
| 2023 | 16 | % |
The detailed employment profile is presented in Table 6. Scrubber benefit for scrubber fitted vessels is calculated on the basis of fuel consumption of heavy fuel oil and price differential between heavy fuel oil and compliant fuel cost for the specific voyage and is presented as part of the daily charter hire in Table 6 or, in cases where it can not be estimated, is not part of the stated daily charter hire.
Orderbook and financing
During the fourth quarter of 2020, the Company, as part of its plan to implement a gradual fleet renewal with modern, energy efficient vessels, entered into agreements for the acquisition of two Japanese dry-bulk newbuild vessels, one Kamsarmax class, 82,000 dwt and of one Post-Panamax class, 87,000 dwt, with scheduled deliveries within the first half of 2022 and the third quarter of 2022, respectively. The vessels are designed to meet the Phase 3 requirements of Energy Efficiency Design Index, (''EEDI Phase 3'') related to the mandatory reduction of green house gas emissions, as adopted by the International Maritime Organization, ("IMO") and also comply with the latest NOx emissions regulation, NOx-Tier III (IMO, MARPOL Annex VI, reg. 13).
Concurrently with the ordering of the newbuild vessels, the Company has concluded the financing arrangements: i) for the Kamsarmax newbuild, a sale and lease back through a ten-year bareboat charter agreement for
Vessel sales and second hand acquisition
In the framework of fleet renewal the Company has entered into memoranda of agreements for the sale of two of its older vessels and for the acquisition of a 2011 second-hand Panamax.
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11 Time Charter Equivalent (“TCE”) rate represents charter revenues net of commissions and voyage expenses divided by the number of available days.
During the last quarter of 2020, the Company made available for sale, a 2003-built, Panamax class, dry-bulk vessel, the Paraskevi. In January 2021, the Company signed an agreement for its sale at a price of
During January 2021, the Company made available for sale a 2004-built, Panamax class, dry-bulk vessel, the Vassos, and signed an agreement for its sale at a price of
Upon consummation of both sale transactions, we expect that our debt will be decreased by
In February 2021, the Company entered into an agreement for the acquisition of a Panamax class, 2011 Japanese-built, dry-bulk, 75,000 dwt at a price of
Mezzanine equity redemption and financing
In February 2021, a Company's subsidiary issued a notice of redemption for all issued and outstanding shares of series A cumulative redeemable perpetual preferred stock, recorded as mezzanine equity (the "Mezzanine Equity") with a redemption price of approximately
Liquidity
As of December 31, 2020, we had liquidity of
As of February 12, 2021, we had liquidity of
Debt Profile
As of December 31, 2020, our consolidated debt before deferred financing costs was
Table 2: Loan repayment Schedule
(in USD millions)
| Ending December 31, | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | 2027 | Total |
| December 31, 2020 | 81.3 | 118.7 | 119.7 | 171.9 | 66.8 | 16.2 | 41.6 | 616.2 |
Derivatives
During the fourth quarter of 2020, the Company entered into bunker fuel contracts for 36,000 tons for calendar 2021 and 24,000 tons for calendar 2022 to sell the spread differential between the price per ton of the
During 2020, the Company entered into forward freight agreements on the Panamax index for 80 days for Q1 2021 and 60 days for Q2 2021, with the objective of reducing the risk arising from the volatility in the charter rates.
During 2020, the Company entered into interest rate derivative contracts with the objective to reduce exposure from the fluctuation of interest rates. As of December 31, 2020, the aggregate notional amount of outstanding interest rate derivative contracts was
Environmental Social Responsibility - Environmental investments
In the context of our Environmental Social Responsibility policies, the Company has completed the installation of 20 scrubbers and continues the retrofit of vessels with ballast water treatment systems. As of December 31, 2020, the Company has 30 vessels equipped with ballast water treatment systems. The aggregate cost paid as of the year end for our environmental investments was
As of December 31, 2020, the scheduled number and estimated down-time days for the subsequent two quarters, for dry-dockings and environmental investments is presented in Table 3.
Table 3: Scheduled number and estimated down-time for dry-dockings and environmental investments.
| Q1 2021 | Q2 2021 | |
| Number of vessels | 1 | 3 |
| Total down time in days | 55 | 80 |
Dividend Policy
The Company has not declared a dividend on the Company’s common stock for the fourth quarter of 2020. The Company had 102,197,670 shares of common stock issued and outstanding as of February 12, 2021.
The aggregate cash dividend of
A Company’s subsidiary declares a cash dividend on a quarterly basis on each of its Series A shares to the respective shareholders of such shares, presented under the caption “Mezzanine Equity” in the condensed consolidated balance sheets. The aggregate cash dividend declared for the Series A shares for the period from October 1, 2020 to December 31, 2020, which was paid on January 4, 2021, was
The declaration and payment of dividends, if any, will always be subject to the discretion of the Board of Directors of the Company. The timing and amount of any dividends declared will depend on, among other things: (i) the Company’s earnings, financial condition and cash requirements and available sources of liquidity; (ii) decisions in relation to the Company’s growth and leverage strategies; (iii) provisions of Marshall Islands and Liberian law governing the payment of dividends; (iv) restrictive covenants in the Company’s existing and future debt instruments; and (v) global economic and financial conditions.
Conference Call
On Tuesday, February 16, 2021 at 9:30 A.M. Eastern Time, the Company’s management team will host a conference call to discuss the Company’s financial results.
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (877) 553-9962 (US Toll Free Dial In), 0(808) 238-0669 (UK Toll Free Dial In) or +44 (0) 2071 928592 (Standard International Dial In). Please quote Safe Bulkers to the operator.
A telephonic replay of the conference call will be available until February 24, 2021 by dialing 1 (866) 331-1332 (US Toll Free Dial In), 0(808) 238-0667 (UK Toll Free Dial In) or +44 (0) 3333 009785 (Standard International Dial In). Access Code: 1859591#
Slides and Audio Webcast
There will also be a live, and then archived, webcast of the conference call, available through the Company’s website (www.safebulkers.com). Participants in the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.
Management Discussion of Fourth Quarter 2020 Results
Statements of Operations
During the fourth quarter of 2020, we operated in a relatively weaker charter market environment with lower operating and interest expenses compared to the same period in 2019, while our revenues were partly supported by the additional earnings from scrubber fitted vessels, the operation of one additional newbuild vessel from April 2020 and reduced voyage expenses. The net effect is reflected in our reduced TCE of
Net revenues: Net revenues decreased by
Voyage expenses: Voyage expenses decreased to
Vessel operating expenses: Vessel operating expenses decreased by
Depreciation: Depreciation increased by
Interest expense: Interest expense decreased to
Daily vessel operating expenses13: Daily vessel operating expenses, calculated by dividing vessel operating expenses by the ownership days of the relevant period, decreased by
Daily general and administrative expenses14: Daily general and administrative expenses, which include management fees payable to our Managers14 and daily company administrations expenses, increased by
Balance sheet
Assets held for sale/Liabilities directly associated with asset held for sale: As of December 31, 2020, we have classified the assets and liability directly associated with the vessel Paraskevi as assets held for sale and presented them on the balance sheet separately under current assets in the amount of
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12 London interbank offered rate.
13 See Table 5.
14 Safety Management Overseas S.A. and Safe Bulkers Management Limited, each of which is a related party that is referred to in this press release as “our Manager” and collectively “our Managers’’.
Unaudited Interim Financial Information and Other Data
| SAFE BULKERS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In thousands of U.S. Dollars except for share and per share data) | |||||||||||
| Three-Months Period Ended December 31, | Twelve-Months Period Ended December 31, | ||||||||||
| 2019 | 2020 | 2019 | 2020 | ||||||||
| REVENUES: | |||||||||||
| Revenues | 55,711 | 54,403 | 206,682 | 206,035 | |||||||
| Commissions | (2,465 | ) | (2,174 | ) | (8,921 | ) | (7,877 | ) | |||
| Net revenues | 53,246 | 52,229 | 197,761 | 198,158 | |||||||
| EXPENSES: | |||||||||||
| Voyage expenses | (5,051 | ) | (4,716 | ) | (13,715 | ) | (41,582 | ) | |||
| Vessel operating expenses | (19,249 | ) | (15,370 | ) | (68,569 | ) | (70,086 | ) | |||
| Depreciation | (12,935 | ) | (13,874 | ) | (50,310 | ) | (54,269 | ) | |||
| General and administrative expenses | (5,332 | ) | (5,677 | ) | (20,639 | ) | (21,502 | ) | |||
| Loss from inventory valuation | (66 | ) | (241 | ) | (414 | ) | (241 | ) | |||
| Early redelivery cost | — | — | (63 | ) | — | ||||||
| Operating income | 10,613 | 12,351 | 44,051 | 10,478 | |||||||
| OTHER (EXPENSE) / INCOME: | |||||||||||
| Interest expense | (6,174 | ) | (4,333 | ) | (26,815 | ) | (21,233 | ) | |||
| Other finance cost | (502 | ) | (174 | ) | (714 | ) | (641 | ) | |||
| Interest income | 328 | 41 | 1,558 | 604 | |||||||
| Loss on derivatives | (121 | ) | (294 | ) | (121 | ) | (1,303 | ) | |||
| Foreign currency gain/(loss) | 219 | 425 | (76 | ) | 916 | ||||||
| Amortization and write-off of deferred finance charges | (809 | ) | (402 | ) | (1,845 | ) | (1,726 | ) | |||
| Net income/(loss) | 3,554 | 7,614 | 16,038 | (12,905 | ) | ||||||
| Less Preferred dividend | 2,878 | 2,878 | 11,498 | 11,500 | |||||||
| Less Mezzanine equity measurement | (104 | ) | 413 | 199 | 908 | ||||||
| Net income/(loss) available to common shareholders | 780 | 4,323 | 4,341 | (25,313 | ) | ||||||
| Earnings/(loss) per share basic and diluted | 0.01 | 0.04 | 0.04 | (0.25 | ) | ||||||
| Weighted average number of shares | 102,631,267 | 102,186,132 | 101,686,312 | 102,617,944 | |||||||
| Twelve-Months Period Ended December 31, | ||||||
| 2019 | 2020 | |||||
| (In millions of U.S. Dollars) | ||||||
| CASH FLOW DATA | ||||||
| Net cash provided by operating activities | 58.3 | 63.4 | ||||
| Net cash used in investing activities | (36.8 | ) | (34.8 | ) | ||
| Net cash provided by/(used in) financing activities | 8.5 | (9.3 | ) | |||
| Net increase in cash, cash equivalents and restricted cash | 30.0 | 19.3 | ||||
| SAFE BULKERS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In thousands of U.S. Dollars) | ||||||
| December 31, 2019 | December 31, 2020 | |||||
| ASSETS | ||||||
| Cash and cash equivalents , time deposits, and restricted cash | 106,378 | 105,218 | ||||
| Other current assets | 29,611 | 21,459 | ||||
| Assets held for sale | — | 8,057 | ||||
| Vessels, net | 944,706 | 942,164 | ||||
| Advances for vessels | 19,294 | 9,126 | ||||
| Restricted cash non-current | 13,701 | 18,754 | ||||
| Other non-current assets | 953 | 851 | ||||
| Total assets | 1,114,643 | 1,105,629 | ||||
| LIABILITIES AND EQUITY | ||||||
| Current portion of long-term debt | 64,054 | 75,784 | ||||
| Liabilities directly associated with assets held for sale | — | 3,983 | ||||
| Other current liabilities | 22,730 | 24,948 | ||||
| Long-term debt, net of current portion | 536,995 | 531,883 | ||||
| Other non-current liabilities | 922 | 6,172 | ||||
| Mezzanine equity | 17,200 | 18,112 | ||||
| Shareholders’ equity | 472,742 | 444,747 | ||||
| Total liabilities and equity | 1,114,643 | 1,105,629 | ||||
| TABLE 4 RECONCILIATION OF ADJUSTED NET INCOME/(LOSS), EBITDA, ADJUSTED EBITDA AND ADJUSTED EARNINGS/(LOSS) PER SHARE | ||||||||||||
| Three-Months Period Ended December 31, | Twelve-Months Period Ended December 31, | |||||||||||
| (In thousands of U.S. Dollars except for share and per share data) | 2019 | 2020 | 2019 | 2020 | ||||||||
| Net Income/(Loss) - Adjusted Net Income/(Loss) | ||||||||||||
| Net Income/(Loss) | 3,554 | 7,614 | 16,038 | (12,905 | ) | |||||||
| Plus Loss on derivatives | 121 | 294 | 121 | 1,303 | ||||||||
| Plus Foreign currency (gain)/loss | (219 | ) | (425 | ) | 76 | (916 | ) | |||||
| Plus Early Redelivery cost | — | — | 63 | — | ||||||||
| Plus Loss on inventory valuation | 66 | 241 | 414 | 241 | ||||||||
| Adjusted net income/(loss) | 3,522 | 7,724 | 16,712 | (12,277 | ) | |||||||
| EBITDA - Adjusted EBITDA | ||||||||||||
| Net income/(loss) | 3,554 | 7,614 | 16,038 | (12,905 | ) | |||||||
| Plus Net Interest expense | 5,846 | 4,292 | 25,257 | 20,629 | ||||||||
| Plus Depreciation | 12,935 | 13,874 | 50,310 | 54,269 | ||||||||
| Plus Amortization and write-off of deferred finance charges | 809 | 402 | 1,845 | 1,726 | ||||||||
| EBITDA | 23,144 | 26,182 | 93,450 | 63,719 | ||||||||
| Plus Early Redelivery cost | — | — | 63 | — | ||||||||
| Plus Loss on inventory valuation | 66 | 241 | 414 | 241 | ||||||||
| Plus Loss on derivatives | 121 | 294 | 121 | 1,303 | ||||||||
| Plus Foreign currency (gain)/loss | (219 | ) | (425 | ) | 76 | (916 | ) | |||||
| ADJUSTED EBITDA | 23,112 | 26,292 | 94,124 | 64,347 | ||||||||
| Earnings per share | ||||||||||||
| Net income/(loss) | 3,554 | 7,614 | 16,038 | (12,905 | ) | |||||||
| Less Preferred dividend | 2,878 | 2,878 | 11,498 | 11,500 | ||||||||
| (Plus)/Less Mezzanine equity measurement | (104 | ) | 413 | 199 | 908 | |||||||
| Net income/(loss) available to common shareholders | 780 | 4,323 | 4,341 | (25,313 | ) | |||||||
| Weighted average number of shares | 102,631,267 | 102,186,132 | 101,686,312 | 102,617,944 | ||||||||
| Earnings/(Loss) per share | 0.01 | 0.04 | 0.04 | (0.25 | ) | |||||||
| Adjusted Earnings/(Loss) per share | ||||||||||||
| Adjusted Net Income/(Loss) | 3,522 | 7,724 | 16,712 | (12,277 | ) | |||||||
| Less Preferred dividend | 2,878 | 2,878 | 11,498 | 11,500 | ||||||||
| (Plus)/Less Mezzanine equity measurement | (104 | ) | 413 | 199 | 908 | |||||||
| Adjusted Net income/(loss) available to common shareholders | 748 | 4,433 | 5,015 | (24,685 | ) | |||||||
| Weighted average number of shares | 102,631,267 | 102,186,132 | 101,686,312 | 102,617,944 | ||||||||
| Adjusted Earnings/(loss) per share | 0.01 | 0.04 | 0.05 | (0.24 | ) | |||||||
EBITDA, Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings/(loss) per share are not recognized measurements under US GAAP.
- EBITDA represents Net income before interest, income tax expense, depreciation and amortization.
- Adjusted EBITDA represents EBITDA before loss on inventory valuation, gain/(loss) on derivatives, early redelivery cost and gain/(loss) on foreign currency.
- Adjusted Net income/(loss) represents Net income/(loss) before loss on inventory valuation, gain/(loss) on derivatives, early redelivery cost and gain/(loss) on foreign currency.
- Adjusted earnings/(loss) per share represents Adjusted Net income/(loss) less preferred dividend divided by the weighted average number of shares.
- EBITDA, Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings per share are used as supplemental financial measures by management and external users of financial statements, such as investors, to assess our financial and operating performance. The Company believes that these non-GAAP financial measures assist our management and investors by increasing the comparability of our performance from period to period. The Company believes that including these supplemental financial measures assists our management and investors in (i) understanding and analyzing the results of our operating and business performance, (ii) selecting between investing in us and other investment alternatives and (iii) monitoring our financial and operational performance in assessing whether to continue investing in us. The Company believes that EBITDA, Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings/(loss) per share are useful in evaluating the Company’s operating performance from period to period because the calculation of EBITDA generally eliminates the effects of financings, income taxes and the accounting effects of capital expenditures and acquisitions, the calculation of Adjusted EBITDA and Adjusted Net Income/Loss generally further eliminates from EBITDA and Net Income/(Loss) respectively the effects from loss on sale of assets, gain/(loss) on derivatives, early redelivery cost and gain/(loss) on foreign currency and loss on inventory valuation, items which may vary from year to year and for different companies for reasons unrelated to overall operating performance. EBITDA, Adjusted EBITDA, Adjusted Net income and Adjusted earnings per share have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of the Company’s results as reported under US GAAP. While EBITDA and Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings/(loss) per share, are frequently used as measures of operating results and performance, they are not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation. In evaluating Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings/(loss) per share, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted earnings/(loss) per share should not be construed as an inference that our future results will be unaffected by the excluded items.
| TABLE 5: FLEET DATA AND AVERAGE DAILY INDICATORS | |||||||||||||||
| Three-Months Period Ended December 31, | Twelve-Months Period Ended December 31, | ||||||||||||||
| 2019 | 2020 | 2019 | 2020 | ||||||||||||
| FLEET DATA | |||||||||||||||
| Number of vessels at period’s end | 41 | 42 | 41 | 42 | |||||||||||
| Average age of fleet (in years) | 9.33 | 10.11 | 9.33 | 10.11 | |||||||||||
| Ownership days (1) | 3,772 | 3,864 | 14,965 | 15,266 | |||||||||||
| Available days (2) | 3,516 | 3,857 | 14,373 | 14,829 | |||||||||||
| Average number of vessels in the period (3) | 41.00 | 42.00 | 41.00 | 41.71 | |||||||||||
| AVERAGE DAILY RESULTS | |||||||||||||||
| Time charter equivalent rate (4) | $ | 13,707 | $ | 12,319 | $ | 12,805 | $ | 10,559 | |||||||
| Daily vessel operating expenses (5) | $ | 5,103 | $ | 3,978 | $ | 4,582 | $ | 4,591 | |||||||
| Daily vessel operating expenses excluding dry-docking and pre-delivery expenses (6) | $ | 4,540 | $ | 3,955 | $ | 4,257 | $ | 4,226 | |||||||
| Daily general and administrative expenses (7) | $ | 1,414 | $ | 1,469 | $ | 1,379 | $ | 1,408 | |||||||
| TIME CHARTER EQUIVALENT RATE RECONCILIATION | |||||||||||||||
| (In thousands of U.S. Dollars except for available days and Time charter equivalent rate) | |||||||||||||||
| Revenues | $ | 55,711 | $ | 54,403 | $ | 206,682 | $ | 206,035 | |||||||
| Less commissions | (2,465 | ) | (2,174 | ) | (8,921 | ) | (7,877 | ) | |||||||
| Less voyage expenses | (5,051 | ) | (4,716 | ) | (13,715 | ) | (41,582 | ) | |||||||
| Time charter equivalent revenue | $ | 48,195 | $ | 47,513 | $ | 184,046 | $ | 156,576 | |||||||
| Available days (2) | 3,516 | 3,857 | 14,373 | 14,829 | |||||||||||
| Time charter equivalent rate (4) | $ | 13,707 | $ | 12,319 | $ | 12,805 | $ | 10,559 | |||||||
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(1) Ownership days represents the aggregate number of days in a period during which each vessel in our fleet has been owned by us.
(2) Available days represents the total number of days in a period during which each vessel in our fleet was in our possession, net of off-hire days associated with scheduled maintenance, which includes major repairs, drydockings, vessel upgrades or special or intermediate surveys.
(3) Average number of vessels in the period is calculated by dividing ownership days in the period by the number of days in that period.
(4) Time charter equivalent rate, or TCE rate, represents our revenues less commissions and voyage expenses during a period divided by the number of available days during such period. TCE rate is a standard shipping industry performance measure used primarily to compare daily earnings generated by vessels on period time charters and spot time charters with daily earnings generated by vessels on voyage charters, because charter rates for vessels on voyage charters are generally not expressed in per day amounts, while charter rates for vessels on period time charters and spot time charters generally are expressed in such amounts. We have only rarely employed our vessels on voyage charters and, as a result, generally our TCE rates approximate our time charter rates.
(5) Daily vessel operating expenses are calculated by dividing vessel operating expenses for the relevant period by ownership days for such period. Vessel operating expenses include crewing, insurance, lubricants, spare parts, provisions, stores, repairs, maintenance including dry-docking, statutory and classification expenses and other miscellaneous items.
(6) Daily vessel operating expenses excluding dry-docking and pre-delivery expenses are calculated by dividing vessel operating expenses excluding dry-docking and pre-delivery expenses for the relevant period by ownership days for such period. Dry-docking expenses include costs of shipyard, paints and agent expenses and pre-delivery expenses include initially supplied spare parts, stores, provisions and other miscellaneous items provided to a newbuild or second hand acquisition prior to their operation.
(7) Daily general and administrative expenses are calculated by dividing general and administrative expenses for the relevant period by ownership days for such period. Daily general and administrative expenses include daily management fees payable to our Managers and daily company administration expenses.
| Table 6: Detailed fleet and employment profile as of February 12, 2021 | ||||||||||||||||||||
| Vessel Name | Dwt | Year Built 1 | Country of Construction | Charter Type | Charter Rate 2 | Commissions 3 | Charter Period 4 | |||||||||||||
| CURRENT FLEET | ||||||||||||||||||||
| Panamax | ||||||||||||||||||||
| Maria | 76,000 | 2003 | Japan | Dry-docking | January 2021 | February 2021 | ||||||||||||||
| Koulitsa | 76,900 | 2003 | Japan | Spot | 5.00 | % | January 2021 | March 2021 | ||||||||||||
| Paraskevi 19 | 74,300 | 2003 | Japan | Spot | $ | 7,842 | 5.00 | % | February 2021 | March 2021 | ||||||||||
| Vassos 20 | 76,000 | 2004 | Japan | Spot | $ | 11,750 | 5.00 | % | January 2021 | April 2021 | ||||||||||
| Katerina | 76,000 | 2004 | Japan | Period | 5.00 | % | December 2020 | June 2021 | ||||||||||||
| Maritsa | 76,000 | 2005 | Japan | Period | 5.00 | % | December 2020 | October 2021 | ||||||||||||
| Efrossini | 75,000 | 2012 | Japan | Period | 5.00 | % | December 2020 | October 2021 | ||||||||||||
| Zoe 10 | 75,000 | 2013 | Japan | Spot | $ | 11,650 | 5.00 | % | September 2020 | May 2021 | ||||||||||
| Kypros Land 10 , 15 | 77,100 | 2014 | Japan | Period | $ | 13,800 | 3.75 | % | August 2020 | August 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | August 2022 | August 2025 | ||||||||||||||||
| Kypros Sea 15 | 77,100 | 2014 | Japan | Period | $ | 13,800 | 3.75 | % | July 2020 | July 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | July 2022 | July 2025 | ||||||||||||||||
| Kypros Bravery 13 | 78,000 | 2015 | Japan | Period | $ | 11,750 | 3.75 | % | August 2020 | August 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | August 2022 | August 2025 | ||||||||||||||||
| Kypros Sky 8 , 13 | 77,100 | 2015 | Japan | Period | $ | 11,750 | 3.75 | % | August 2020 | August 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | August 2022 | August 2025 | ||||||||||||||||
| Kypros Loyalty 13 | 78,000 | 2015 | Japan | Period | $ | 11,750 | 3.75 | % | July 2020 | July 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | July 2022 | July 2025 | ||||||||||||||||
| Kypros Spirit 8, 15 | 78,000 | 2016 | Japan | Period | $ | 13,800 | 3.75 | % | July 2020 | July 2022 | ||||||||||
| BPI 82 5TC * | 3.75 | % | July 2022 | July 2025 | ||||||||||||||||
| Kamsarmax | ||||||||||||||||||||
| Pedhoulas Merchant | 82,300 | 2006 | Japan | Spot | $ | 9,951 | 5.00 | % | December 2020 | March 2021 | ||||||||||
| Pedhoulas Trader | 82,300 | 2006 | Japan | Period | 5.00 | % | February 2021 | August 2021 | ||||||||||||
| Pedhoulas Leader | 82,300 | 2007 | Japan | Period | 5.00 | % | December 2020 | July 2021 | ||||||||||||
| Pedhoulas Commander | 83,700 | 2008 | Japan | Period | $ | 9,950 | 5.00 | % | June 2020 | June 2021 | ||||||||||
| Pedhoulas Builder | 81,600 | 2012 | China | |||||||||||||||||
| Pedhoulas Fighter | 81,600 | 2012 | China | Period 12 | 5.00 | % | December 2020 | June 2021 | ||||||||||||
| Pedhoulas Farmer 5 | 81,600 | 2012 | China | Spot 12 | $ | 21,000 | 5.00 | % | January 2021 | March 2021 | ||||||||||
| Pedhoulas Cherry | 82,000 | 2015 | China | Spot 11 | $ | 7,782 | 5.00 | % | November 2020 | February 2021 | ||||||||||
| Spot 11 | $ | 22,250 | 5.00 | % | March 2021 | March 2021 | ||||||||||||||
| Pedhoulas Rose 5 | 82,000 | 2017 | China | Period 11 | $ | 13,750 | 5.00 | % | December 2020 | May 2021 | ||||||||||
| Pedhoulas Cedrus18 | 82,000 | 2017 | China | Period | $ | 13,000 | 3.75 | % | August 2020 | May 2021 | ||||||||||
| Post-Panamax | ||||||||||||||||||||
| Marina | 87,000 | 2006 | Japan | Spot12 | $ | 12,000 | 5.00 | % | February 2021 | February 2021 | ||||||||||
| Xenia | 87,000 | 2006 | Japan | Spot11 | $ | 12,200 | 5.00 | % | January 2021 | February 2021 | ||||||||||
| Sophia | 87,000 | 2007 | Japan | Spot11 | $ | 31,750 | 5.00 | % | February 2021 | March 2021 | ||||||||||
| Eleni | 87,000 | 2008 | Japan | Spot12 | $ | 14,000 | 5.00 | % | January 2021 | February 2021 | ||||||||||
| Martine | 87,000 | 2009 | Japan | Spot12 | $ | 11,250 | 5.00 | % | February 2021 | March 2021 | ||||||||||
| Andreas K | 92,000 | 2009 | South Korea | Spot11 | $ | 32,500 | 5.00 | % | February 2021 | March 2021 | ||||||||||
| Panayiota K 9 | 92,000 | 2010 | South Korea | Spot 12 | $ | 12,400 | 5.00 | % | January 2021 | April 2021 | ||||||||||
| Agios Spyridonas 9 | 92,000 | 2010 | South Korea | Spot 12 | $ | 10,750 | 5.00 | % | December 2020 | April 2021 | ||||||||||
| Venus Heritage 10 | 95,800 | 2010 | Japan | Spot 12 | $ | 15,000 | 5.00 | % | January 2021 | February 2021 | ||||||||||
| Venus History 10 | 95,800 | 2011 | Japan | Spot12 | $ | 14,500 | 5.00 | % | February 2021 | February 2021 | ||||||||||
| Venus Horizon | 95,800 | 2012 | Japan | Spot11 | $ | 18,500 | 5.00 | % | January 2021 | April 2021 | ||||||||||
| Troodos Sun | 85,000 | 2016 | Japan | Period12 | $ | 16,000 | 5.00 | % | February 2021 | May 2021 | ||||||||||
| Troodos Air | 85,000 | 2016 | Japan | Period12 | $ | 11,500 | 5.00 | % | February 2021 | March 2021 | ||||||||||
| Troodos Oak 14 | 85,000 | 2020 | Japan | Spot | 5.00 | % | June 2020 | May 2021 | ||||||||||||
| Capesize | ||||||||||||||||||||
| Mount Troodos 16 | 181,400 | 2009 | Japan | Period | BCI* | 5.00 | % | April 2020 | June 2021 | |||||||||||
| Kanaris | 178,100 | 2010 | China | Period 6 | $ | 25,928 | 5.00 | % | September 2011 | September 2031 | ||||||||||
| Pelopidas | 176,000 | 2011 | China | Period | $ | 38,000 | 5.00 | % | January 2012 | January 2022 | ||||||||||
| Lake Despina | 181,400 | 2014 | Japan | Period 7 | BCI * | 5.00 | % | February 2021 | February 2022 | |||||||||||
| TOTAL | 3,862,000 | |||||||||||||||||||
| Orderbook | ||||||||||||||||||||
| TBN17 | 82,000 | 1H 2022 | Japan | |||||||||||||||||
| TBN | 87,000 | Q3 2022 | Japan | |||||||||||||||||
(1) For existing vessels, the year represents the year built. For any newbuilds, the date shown reflects the expected delivery dates.
(2) Quoted charter rates are the recognized daily gross charter rates. For charter parties with variable rates among periods or consecutive charter parties with the same charterer, the recognized gross daily charter rate represents the weighted average gross daily charter rate over the duration of the applicable charter period or series of charter periods, as applicable. In the case of a charter agreement that provides for additional payments, namely ballast bonus to compensate for vessel repositioning, the gross daily charter rate presented has been adjusted to reflect estimated vessel repositioning expenses. Gross charter rates are inclusive of commissions. Net charter rates are charter rates after the payment of commissions. In the case of voyage charters, the charter rate represents revenue recognized on a pro rata basis over the duration of the voyage from load to discharge port less related voyage expenses.
(3) Commissions reflect payments made to third-party brokers or our charterers.
(4) The start dates listed reflect either actual start dates or, in the case of contracted charters that had not commenced as of February 12, 2021, the scheduled start dates. Actual start dates and redelivery dates may differ from the referenced scheduled start and redelivery dates depending on the terms of the charter and market conditions and does not reflect the options to extend the period time charter.
(5) MV Pedhoulas Farmer and MV Pedhoulas Rose were sold and leased back, in 2015 and 2017, respectively, on a bareboat charter basis for a period of 10 years, with a purchase obligation at the end of the bareboat charter period and purchase options in favor of the Company after the second year of the bareboat charter, at annual intervals and predetermined purchase prices.
(6) Charterer agreed to reimburse us for part of the cost of the scrubbers and BWTS to be installed on the vessel, which is recorded by increasing the recognized daily charter rate by
(7) A period time charter of 12 to 14 months at a gross daily charter rate linked to the Baltic Exchange Capesize Index (“BCI'') times
(8) MV Kypros Sky and MV Kypros Spirit were sold and leased back in December 2019 on a bareboat charter basis for a period of eight years, with purchase options in favor of the Company commencing three years following the commencement of the bareboat charter period and a purchase obligation at the end of the bareboat charter period, all at predetermined purchase prices.
(9) MV Panayiota K and MV Agios Spyridonas were sold and leased back in January 2020 on a bareboat charter basis for a period of six years, with purchase options in favor of the Company commencing three years following the commencement of the bareboat charter period and a purchase obligation at the end of the bareboat charter period, all at predetermined purchase prices.
(10) MV Zoe, MV Kypros Land, MV Venus Heritage and MV Venus History were sold and leased back in November 2019, on a bareboat charter basis, one for a period of eight years and three for a period of seven and a half years, with a purchase option in favor of the Company five years and nine months following the commencement of the bareboat charter period at a predetermined purchase price.
(11) Scrubber benefit was agreed on the basis of fuel consumption of heavy fuel oil and the price differential between the heavy fuel oil and the compliant fuel cost for the voyage and is included on the daily gross charter rate presented.
(12) Scrubber benefit was agreed on the basis of fuel consumption of heavy fuel oil and the price differential between the heavy fuel oil and the compliant fuel cost for the voyage and is not included on the daily gross charter rate presented.
(13) A period time charter of 5 years at a daily gross charter rate of
(14) A period time charter of 11 to 13 months at a gross daily charter rate linked to the BPI-82 5TC times
(15) A period time charter of 5 years at a daily gross charter rate of
(16) A period time charter at a gross daily charter rate linked to the BCI' times
(17) The newbuild vessel will be sold and leased back upon delivery in 1H 2022, on a bareboat charter basis for a period of ten years with a purchase option in favor of the Company three years following the commencement of the bareboat charter period and a purchase obligation at the end of the bareboat charter period, all at predetermined purchase prices.
(18) The vessel will be sold and leased back upon Mezzanine Equity redemption in February 2021, on a bareboat charter basis for a period of ten years with a purchase option in favor of the Company three years following the commencement of the bareboat charter period and a purchase obligation at the end of the bareboat charter period, all at predetermined purchase prices.
(19) The Company has enter an agreement to sell the vessel with expected delivery to her new owners in March 2021.
(20) The Company has enter an agreement to sell the vessel with expected delivery to her new owners in April 2021.
About Safe Bulkers, Inc.
The Company is an international provider of marine drybulk transportation services, transporting bulk cargoes, particularly coal, grain and iron ore, along worldwide shipping routes for some of the world’s largest users of marine drybulk transportation services. The Company’s common stock, series C preferred stock and series D preferred stock are listed on the NYSE, and trade under the symbols “SB”, “SB.PR.C”, and “SB.PR.D”, respectively.
Forward-Looking Statements
This press release contains forward-looking statements (as defined in Section 27A of the Securities Exchange Act of 1934, as amended, and in Section 21E of the Securities Act of 1933, as amended) concerning future events, the Company’s growth strategy and measures to implement such strategy, including expected vessel acquisitions and entering into further time charters. Words such as “expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,” “estimates” and variations of such words and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, business disruptions due to natural disasters or other events, such as the recent COVID-19 pandemic, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, changes in the demand for drybulk vessels, competitive factors in the market in which the Company operates, risks associated with operations outside the United States and other factors listed from time to time in the Company’s filings with the Securities and Exchange Commission. The Company expressly disclaims any obligations or undertaking to release any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.
For further information please contact:
Company Contact:
Dr. Loukas Barmparis
President
Safe Bulkers, Inc.
Tel.: +30 21 11888400
+357 25 887200
E-Mail:directors@safebulkers.com
Investor Relations / Media Contact:
Nicolas Bornozis, President
Capital Link, Inc.
230 Park Avenue, Suite 1536
New York, N.Y. 10169
Tel.: (212) 661-7566
Fax: (212) 661-7526
E-Mail:safebulkers@capitallink.com
FAQ
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