NEW YORK, Nov. 7, 2007 (PRIME NEWSWIRE) -- Eagle Bulk Shipping Inc. (Nasdaq:EGLE) today announced its results for the third quarter of 2007. The Company also declared a dividend of $0.50 per share, based on its third quarter results.
Third quarter 2007 highlights included:
* Net income increased by $6.4 million, or 70%, to $15.5 million ($0.37 per share based on a weighted average of 42,365,252 diluted shares) for the third quarter of 2007, from $9.1 million ($0.25 per share) for the third quarter of 2006. * Gross time charter revenues increased by $6.3 million, or 20%, to $36.9 million for the third quarter of 2007, from $30.7 million for the third quarter of 2006. * EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, increased by 24% to $27.4 million for the third quarter of 2007, from $22.1 million during the third quarter of 2006. (Please see below for a reconciliation of EBITDA to net income). * On August 7, 2007, the Company paid a cash dividend of $0.47 per share for its second quarter results. * Completed the transaction to construct a fleet of 26 newbuild Supramax vessels for $1.1 billion. Upon delivery, the Company's fleet will more than double from 23 vessels to 49 vessels, expand tonnage by 124% to approximately 2.7 million deadweight tons, and reduce the average age of the fleet to 2 years.
Subsequent events:
* On October 19, 2007, the Company entered into an amended and restated Credit Agreement with the Royal Bank of Scotland plc to increase the amount available under its revolving credit facility from $600 million to $1.6 billion. The new facility has a term of ten years, is available in full until July 2012, bears interest at the rate of 0.80% to 0.90% over LIBOR, and is subject to a commitment fee of 0.25% annually on unused amounts. * The Company's Board of Directors has declared a cash dividend for the third quarter of 2007 of $0.50 per share, based on 46,727,153 of the Company's common shares outstanding, payable on or about November 28th, 2007, to all shareholders of record as of November 21, 2007. As previously reported, Eagle Bulk's new dividend policy is to target a $0.50 dividend which is announced at the time of the Company's quarterly earnings.
Commenting on the third quarter results, Sophocles Zoullas, Chairman and Chief Executive Officer, said, "We are very pleased with our third quarter results, which included operational strength from the existing fleet, as well as the acquisition of 26 Supramax vessels. This transaction reaffirmed Eagle's proven growth strategy, which now includes $1.5 billion worth of acquisitions to date, while increasing minimum contracted revenue to approximately $1.2 billion. Furthermore, with 31 new vessels delivering to us over the next four years, we are able to provide an annual compounded rate of growth in excess of 20% based on our current fleet. We expect substantial revenue upside, as well, with up to 20 profit sharing charters and up to 15 open vessels to charter through 2008 to take advantage of ongoing market strength. We are pleased that our shareholders will continue to participate in this growth directly through our targeted $0.50 dividend."
Mr. Zoullas continued, "Operationally, our fleet maintained one of the lowest break-even points in the industry while achieving a utilization rate for the quarter of 99.3%. With an average fleet age of 2 years and 39 sister ships to further provide efficiency and economies of scale, we expect our record of operational excellence to continue. Finally, with a strong balance sheet and a new $1.6 billion revolving credit facility, we also have the financial flexibility to continue to make opportunistic investments to grow the business."
Results for the three month periods ended September 30, 2007 and 2006
For the quarter ended September 30, 2007, net income was $15,501,895, up 70% from $9,100,737 for the comparable quarter of 2006. Diluted earnings per share were $0.37 in the third quarter of 2007 compared to $0.25 in the third quarter of 2006.
All of the Company's revenues were earned from time charters. Gross revenues increased by 20% to $36,934,096 for the quarter ended September 30, 2007 from $30,671,690 for the quarter ended September 30, 2006. Net revenues increased by 20% to $33,955,704 after deductions for brokerage commissions of $1,898,392 and amortization of net prepaid charter revenue of $1,080,000 for the quarter ended September 30, 2007, from $28,358,830 after deductions for brokerage commissions of $1,587,860 and amortization of net prepaid charter revenue of $725,000 for the quarter ended September 30, 2006.
Vessel expenses for the quarter ended September 30, 2007 were $6,647,223 compared to $6,118,038 for the quarter ended September 30, 2006. The increase in vessel expenses is attributable to a larger fleet size in operation for the third quarter of 2007 and also due to increases in vessel crew and lubricant costs.
EBITDA, as defined by the Company's credit agreement, increased 24% to $27,421,413 for the quarter ended September 30, 2007, from $22,063,519 in the quarter ended September 30, 2006 (Please see below for a reconciliation of EBITDA to net income).
Results for the nine month periods ended September 30, 2007 and 2006
For the nine-month periods ended September 30, 2007 and 2006, net income was $35,914,378 and $29,284,974, respectively. Diluted earnings per share for the same two periods were $0.88 and $0.86, respectively.
Gross revenues increased by 17% to $97,422,371 for the nine-month period ended September 30, 2007 from $82,919,582 for the nine months ended September 30, 2006. Net revenues increased by 17% to $89,202,283 after deductions for brokerage commissions of $4,980,088 and amortization of net prepaid charter revenue of $3,240,000 for the nine months ended September 30, 2007 from $76,254,265 after deductions for brokerage commissions of $4,229,817 and amortization of net prepaid charter revenue of $2,435,500 for the nine months ended September 30, 2006.
Vessel expenses for the nine-month periods ended September 30, 2007 and 2006 were $19,749,702 and $15,742,457, respectively. The increase was attributed primarily due to a larger fleet size and increases in crew costs and costs of oil-based lubricants.
EBITDA, as defined by the Company's credit agreement, increased 18% to $71,527,623 for the nine months ended September 30, 2007, from $60,590,828 for the nine months ended September 30, 2006 (Please see below for a reconciliation of EBITDA to net income).
INVESTING ACTIVITIES
During the third quarter of 2007, the Company acquired 26 Supramax newbuilding vessels from Kyrini Shipping Inc., an unrelated privately held Greek shipping company, for a total consideration of approximately $1,100,000,000 which includes construction contracts aggregating approximately $944,000,000 and cash consideration of $150,000,000 to purchase all of the issued and outstanding shares of the capital stock of 19 wholly owned subsidiaries of Kyrini Shipping Inc., a Liberian corporation whose primary assets consisted of contracts for the construction of 18 Supramax drybulk vessels and options for the construction of a further 8 Supramax drybulk vessels which the Company exercised on August 1, 2007. Five of these 26 Supramax vessels are of the 53,000 deadweight ton category, while the remaining 21 are of the 58,000 deadweight ton category. The vessels are expected to be delivered between 2008 and 2012 and 21 vessels are secured by long-term charters through 2018. The Company will periodically advance construction payments to the shipyard. As of September 30, 2007, the Company had advanced a total of $221,462,500 in regards to the cash consideration, acquisition costs and shipyard deposits for the newbuild vessels acquired in connection with the Kyrini transaction. These amounts have been funded through borrowings under its credit facility and have been recorded as Advances for Vessel Construction in the Company's financial statements.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities during the nine-month periods ended September 30, 2007 and 2006 was $62,587,594 and $52,123,412, respectively. The increase was primarily due to cash generated from the operation of the fleet for 4,417 operating days in the nine-month period ended September 30, 2007, compared to 3,734 operating days during the same period in 2006.
Net cash used in investing activities during the nine-month period ended September 30, 2007 was $391,953,782. During the nine-month period ended September 30, 2007, the Company purchased three modern Supramax vessels, the SHRIKE, SKUA and KITTIWAKE, for a total contract price of $138,700,000 and associated costs of $176,098 relating to these vessel acquisitions. During the nine-month period ended September 30, 2007, for its newbuilding program, the Company placed deposits in Japanese yen of an equivalent of $38,113,974 for three 56,000 deadweight ton vessels, the CROWNED EAGLE, CRESTED EAGLE and STELLAR EAGLE, which are to be constructed and delivered in November 2008, February 2009 and April 2009, respectively. These deposits are in addition to the deposits of $24,798,118 that were placed for the GOLDEN EAGLE and IMPERIAL EAGLE in 2006. In addition, the Company advanced an aggregate of $221,462,500 in acquisition costs and shipyard deposits for the newbuilds acquired in connection with the Kyrini transaction. For these newbuildings, the Company has incurred associated capitalized interest costs of $4,493,579 and has capitalized other costs of $1,019,113. On February 12, 2007, the SHIKRA, a 1984-built Handymax vessel, was sold to an unrelated third party for $12,525,000. The Company incurred total expenses of $513,518 relating to the sale.
Net cash provided by financing activities during the nine-month period ended September 30, 2007 was $462,037,833. During the nine-month period ended September 30, 2007, the Company received $239,848,266 in gross proceeds from the sale of common shares of the Company and paid costs of $5,701,127 associated with the share sales. During the nine-month period ended September 30, 2007, the Company borrowed $300,304,279 from its revolving credit facility, of which $36,344,000 was used to partly fund the purchase of the three vessels, the SHRIKE, SKUA and KITTIWAKE, which were all delivered in the second quarter, $259,576,474 was used to fund the advances for the newbuilding vessels, and $4,383,805 was used to fund the capitalized borrowing costs and other costs associated with the newbuilding vessels. The Company used $12,440,000 from the gross proceeds of the sale of the SHIKRA to repay borrowings from the revolving credit facility. During the nine-month period ended September 30, 2007, the Company paid $58,771,405 in dividends. Net cash provided by financing activities during the nine-month period ended September 30, 2006 was $51,676,257 which primarily consisted of $33,000,000 in gross proceeds from a private placement of shares of the Company's common stock, borrowings of $74,800,000 from the Company's revolving credit facility, and payments of $53,420,500 in dividends.
As of September 30, 2007, the Company's cash balance was $154,947,136 compared to a cash balance of $22,275,491 at December 31, 2006. In addition, the Company maintains $7,200,000 in cash deposits with its lender for loan compliance purposes. This amount is recorded in Restricted Cash in the Company's financial statements as of September 30, 2007. The cash deposit amount at the end of December 31, 2006 was $6,400,000. Also recorded in Restricted Cash is an amount of $124,616 which is collateralizing a letter of credit relating to the Company's office lease.
The Company's revolving credit facility has been amended and enhanced periodically to accommodate the newbuilding program. The incremental borrowings are subject to the same terms and conditions as the existing credit facility. As of September 30, 2007, total availability under the enhanced revolving credit facility was $600,000,000 of which $527,839,099 had been borrowed. The facility also provides it with the ability to borrow up to $15,000,000 for working capital purposes. Subsequent to the end of the third quarter, on October 19, 2007, the revolving credit facility was amended, restated and increased to $1,600,000,000. The amended facility has a term of ten years, and there are no principal repayment obligations until July 2012. Over the remaining five years until maturity in July 2017, the facility will reduce in semi-annual amounts of $75,000,000 with a final reduction of $850,000,000 occurring simultaneously with the last semi-annual reduction. The facility bears interest at the rate of 0.80% to 0.90% over LIBOR, and is subject to a commitment fee of 0.25% annually on unused amounts. The amended facility also provides the Company with the ability to borrow up to $20,000,000 for working capital purposes.
Dividend
In the nine-month period ended September 30, 2007, the Company paid a total of $58,771,405 in cash dividends to its shareholders, equivalent to $1.48 per share. As of September 30, 2007, the Company has paid aggregate cash dividends to its shareholders of $4.10 per share or an aggregate amount of $145,161,905.
Disclosure of Non-GAAP Financial Measures
EBITDA represents operating earnings before extraordinary items, depreciation and amortization, interest expense, and income taxes, if any. EBITDA is included because it is used by certain investors to measure a company's financial performance. EBITDA is not an item recognized by GAAP and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity. EBITDA is presented to provide additional information with respect to the Company's ability to satisfy its obligations including debt service, capital expenditures, and working capital requirements. While EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.
The Company's revolving credit facility permits it to pay dividends in amounts up to its earnings before extraordinary or exceptional items, interest, taxes, depreciation and amortization (Credit Agreement EBITDA), less the aggregate amount of interest incurred and net amounts payable under interest rate hedging agreements during the relevant period and an agreed upon reserve for dry-docking, provided that there is not a default or breach of loan covenant under the credit facility and the payment of the dividends would not result in a default or breach of a loan covenant. Therefore, the Company believes that this non-GAAP measure is important for its investors as it reflects its ability to pay dividends. The following table is a reconciliation of net income, as reflected in the consolidated statements of operations, to the Credit Agreement EBITDA:
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Three Months Ended Nine Months Ended
---------------------------------------------------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2007 2006 2007 2006
---------------------------------------------------------------------
Net Income $15,501,895 $9,100,737 $35,914,378 $29,284,974
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Interest Expense 3,476,977 3,180,336 9,789,541 7,364,009
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Depreciation and
Amortization 7,241,927 5,980,747 19,079,511 15,737,990
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Amortization of
Prepaid and
Deferred Revenue 1,080,000 725,000 3,240,000 2,435,500
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EBITDA 27,300,799 18,986,820 68,023,430 54,822,473
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Adjustments for
Exceptional Items:
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Non-cash
Compensation
Expense (1) 120,614 3,076,699 3,504,193 5,768,355
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Credit Agreement
EBITDA $27,421,413 $22,063,519 $71,527,623 $60,590,828
-----------------====================================================
(1) Management's participation in profits interests in Eagle
Ventures LLC and stock options (see Notes to our financial
statements)
CAPITAL EXPENDITURES
The Company's capital expenditures relate to the purchase of vessels, construction of newbuilding vessels, and capital improvements to existing vessels which are expected to enhance the revenue earning capabilities and safety of these vessels. During the nine-month period ended September 30, 2007, the Company spent $138,876,098 on the purchase of new vessels which were delivered in the second quarter, and $259,576,474 on acquisition costs and shipyard deposits in connection with the construction of newbuilding vessels. As of September 30, 2007, for the newbuilding program, the Company has capitalized interest costs of $4,872,603 and other costs of $1,152,356.
In addition to acquisitions that the Company may undertake in future periods, the Company's other major capital expenditures include funding the Company's maintenance program of regularly scheduled drydocking necessary to preserve the quality of its existing vessels as well as to comply with international shipping standards and environmental laws and regulations. Although the Company has some flexibility regarding the timing of its dry docking, the costs are relatively predictable. Management anticipates that vessels are to be drydocked every two and a half years. Funding of these requirements is anticipated to be met with cash from operations. We anticipate that this process of recertification will require us to reposition these vessels from a discharge port to shipyard facilities, which will reduce our available days and operating days during that period.
Drydocking costs incurred are amortized to expense on a straight-line basis over the period through the date of the next scheduled drydocking. For the three-month period ended September 30, 2007, three of our vessels passed drydock surveys. During the corresponding period in 2006, two vessels were drydocked. For the nine-month periods ended September 30, 2007 and 2006, we spent $2,972,553 and $2,269,422, respectively, on vessel drydockings. The following table represents certain information about the estimated costs for anticipated vessel drydockings in the next four quarters, along with the anticipated off-hire days:
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Quarter Ending Off-hire Days(1) Projected Costs(2)
-------------- ---------------- ------------------
December 31, 2007 15 $0.45 million
March 31, 2008 15 $0.50 million
June 30, 2008 30 $1.00 million
September 30, 2008 60 $2.00 million
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(1) Actual duration of drydocking will vary based on the condition
of the vessel, yard schedules and other factors.
(2) Actual costs will vary based on various factors, including
where the drydockings are actually performed.
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SUMMARY CONSOLIDATED FINANCIAL AND OTHER DATA:
The following table summarizes the Company's selected consolidated
financial and other data for the periods indicated below.
CONSOLIDATED STATEMENTS OF OPERATIONS:
(UNAUDITED)
--------------------------------------------------
Three Months Ended Nine Months Ended
--------------------------------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
----------- ----------- ----------- -----------
2007 2006 2007 2006
----------- ----------- ----------- -----------
Revenues, net of
Commissions $33,955,704 $28,358,830 $89,202,283 $76,254,265
Vessel Expenses 6,647,223 6,118,038 19,749,702 15,742,457
Depreciation and
Amortization 7,241,927 5,980,747 19,079,511 15,737,990
General and
Administrative
Expenses 1,570,980 1,266,905 4,787,974 3,366,408
Non-cash
Compensation
Expense 120,614 3,076,699 3,504,193 5,768,355
Gain on Sale of
Vessel -- -- (872,568) --
----------- ----------- ----------- -----------
Total Operating
Expenses 15,580,744 16,442,389 46,248,812 40,615,210
----------- ----------- ----------- -----------
Operating Income 18,374,960 11,916,441 42,953,471 35,639,055
Interest Expense 3,476,977 3,180,336 9,789,541 7,364,009
Interest Income (603,912) (364,632) (2,750,448) (1,009,928)
----------- ----------- ----------- -----------
Net Interest
Expense 2,873,065 2,815,704 7,039,093 6,354,081
----------- ----------- ----------- -----------
Net Income $15,501,895 $9,100,737 $35,914,378 $29,284,974
=========== =========== =========== ===========
Weighted Average
Shares
Outstanding:
Basic 42,209,617 35,900,000 40,493,753 34,086,813
Diluted 42,365,252 35,900,678 40,590,796 34,086,848
Per Share
Amounts:
Basic Net Income $0.37 $0.25 $0.89 $0.86
Diluted Net
Income $0.37 $0.25 $0.88 $0.86
Cash Dividends
Declared and
Paid $0.47 $0.50 $1.48 $1.57
Fleet Operating Days:
---------------------
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Three Months Ended Nine Months Ended
---------------------------------------------------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2007 2006 2007 2006
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Ownership Days 1,656 1,463 4,510 3,816
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Available Days 1,607 1,443 4,440 3,752
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Operating Days 1,595 1,437 4,417 3,734
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Fleet Utilization 99.3% 99.6% 99.5% 99.5%
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CONSOLIDATED BALANCE SHEETS:
September 30, December 31,
2007 2006
-------------- ------------
ASSETS: (Unaudited)
Current Assets:
Cash $154,947,136 $22,275,491
Accounts Receivable 2,033,860 616,205
Prepaid Charter Revenue 500,000 3,740,000
Prepaid Expenses 1,618,699 1,020,821
-------------- ------------
Total Current Assets 159,099,695 27,652,517
Vessels and Vessel Improvements, net 611,870,650 502,141,951
Advances for Vessel Construction 290,399,551 25,190,941
Restricted Cash 7,324,616 6,524,616
Deferred Drydock Costs, net 3,838,826 1,937,299
Deferred Financing Costs, net 2,509,504 2,406,839
Other Assets -- 2,936,804
-------------- ------------
Total Assets $1,075,042,842 $568,790,967
============== ============
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable $4,129,487 $1,650,159
Accrued Interest 2,993,138 800,683
Other Accrued Liabilities 1,796,334 1,717,124
Unearned Charter Hire Revenue 4,671,174 2,713,060
-------------- ------------
Total Current Liabilities 13,590,133 6,881,026
Long-term Debt 527,839,099 239,974,820
Other Liabilities 3,151,969 359,180
-------------- ------------
Total Liabilities 544,581,201 247,215,026
Stockholders' Equity:
Preferred Stock, $.01 par value,
25,000,000 shares authorized, none
issued -- --
Common shares, $.01 par value,
100,000,000 shares authorized,
46,727,153 shares
issued and outstanding as of
September 30, 2007 and 35,900,001
shares issued and outstanding as of
December 31, 2006, respectively 467,271 359,000
Additional Paid-In Capital 601,938,926 364,574,877
Retained Earnings (net of cumulative
dividends declared of $145,161,905 at
September 30, 2007 and $86,390,500 at
December 31, 2006) (68,792,587) (45,935,560)
Accumulated Other Comprehensive
(Loss)/Income (3,151,969) 2,577,624
-------------- ------------
Total Stockholders' Equity 530,461,641 321,575,941
-------------- ------------
Total Liabilities and Stockholders'
Equity $1,075,042,842 $568,790,967
============== ============
CONSOLIDATED STATEMENT OF CASH FLOWS:
(UNAUDITED)
Nine Months Ended
September 30, September 30,
------------ ------------
2007 2006
---- ----
Cash Flows from Operating Activities:
Net Income $35,914,378 $29,284,974
Adjustments to Reconcile Net Income to
Net Cash provided by Operating
Activities:
Items included in net income not
affecting cash flows:
Depreciation 18,008,485 15,222,940
Amortization of Deferred Drydocking Costs 1,071,026 515,050
Amortization of Deferred Financing Costs 180,070 117,491
Amortization of Prepaid and Deferred
Charter Revenue 3,240,000 2,435,500
Non-cash Compensation Expense 3,504,193 5,768,355
Gain on Sale of Vessel (872,568) --
Changes in Operating Assets and
Liabilities:
Accounts Receivable (1,417,655) (117,058)
Prepaid Expenses (597,878) (1,086,031)
Accounts Payable 2,300,317 713,068
Accrued Interest 2,192,455 136,810
Accrued Expenses 79,210 547,114
Drydocking Expenditures (2,972,553) (2,269,422)
Unearned Charter Hire Revenue 1,958,114 854,621
------------ ------------
Net Cash Provided by Operating
Activities 62,587,594 52,123,412
Cash Flows from Investing Activities:
Advances for Vessel Construction (265,089,166) --
Purchase of Vessels and Improvements (138,876,098) (105,112,609)
Proceeds from Sale of Vessel 12,011,482 --
------------ ------------
Net Cash Used in Investing Activities (391,953,782) (105,112,609)
Cash Flows from Financing Activities:
Issuance of Common Stock 239,848,266 33,000,000
Equity Issuance Costs (5,701,127) (1,784,436)
Bank Borrowings 300,304,279 74,800,000
Repayment of Bank Debt (12,440,000) --
Restricted Cash (800,000) 100,000
Deferred Financing Costs (402,180) (1,018,807)
Cash Dividends (58,771,405) (53,420,500)
------------ ------------
Net Cash Provided by Financing
Activities 462,037,833 51,676,257
Net Increase/(Decrease) in Cash 132,671,645 (1,312,940)
Cash at Beginning of Period 22,275,491 24,526,528
------------ ------------
Cash at End of Period $154,947,136 $23,213,588
============ ============
Supplemental Cash Flow Information:
Cash paid during the period for Interest
(including Capitalized interest of
$2,296,435 in 2007 and Commitment Fees) $11,843,726 $7,110,772
The following table represents certain information about the
Company's revenue earning charters, as of September 30, 2007:
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Daily
Time
Delivered Time Charter
Year to Charter Hire
Vessel Built Dwt Charterer Expiration(1) Rate
------ ----- --- --------- ------------- -------
Cardinal 2004 55,408 June 21, May 2008 to $28,000
2007 August 2008
Condor(2) 2001 50,296 March 19, May 2009 to $20,500
2007 August 2009
Falcon(3) 2001 50,296 April 22, February 2008 to $20,950
2005 June 2008
Griffon 1995 46,635 March 18, March 2009 to $20,075
2007 June 2009
Harrier(4) 2001 50,296 June 21, June 2009 to $24,000
2007 September 2009
Hawk I 2001 50,296 April 1, April 2009 to $22,000
2007 June 2009
Heron(5) 2001 52,827 December 11, December 2007 to $24,000
2005 February 2008
Jaeger(6) 2004 52,248 July 12, July 2008 to $27,500
2007 September 2008
Kestrel I(7) 2004 50,326 July 1, December 2007 to $18,750
2006 April 2008
Kite 1997 47,195 August 11, September 2009 to $21,000
2007 January 2010
Merlin(8) 2001 50,296 October 26, October 2007 to $24,000
2005 December 2007
Osprey I(9) 2002 50,206 September 1, July 2008 to $21,000
2005 November 2008
Peregrine 2001 50,913 December 16, December 2008 to $20,500
2006 March 2009
Sparrow(10) 2000 48,225 January 27, December 2007 to $24,000
2007 March 2008
Tern(11) 2003 50,200 July 3, December 2007 to $19,000
2006 April 2008
Shrike(12) 2003 53,343 April 24, April 2009 to $24,600
2007 August 2009
Skua(13) 2003 53,350 June 20, May 2009 to $24,200
2007 August 2009
Kittiwake(14) 2002 53,146 June 27, May 2008 to $30,400
2007 August 2008
(1) The date range provided represents the earliest and latest date
on which the charterer may redeliver the vessel to the Company
upon the termination of the charter.
(2) The charterer of the CONDOR has exercised its option to extend
the charter period by 11 to 13 months at a time charter rate of
$22,000 per day.
(3) Upon conclusion of the current charter, the FALCON commences a
new time charter with a rate of $39,500 per day for 21 to 23
months. The charterer has an option to extend the charter period
by 11 to 13 months at a daily time charter rate of $41,000.
(4) The daily rate for the HARRIER is $27,000 for the first year and
$21,000 for the second year. Revenue recognition is based on an
average daily rate of $24,000.
(5) Upon conclusion of the current charter, the HERON commences a
new time charter with a rate of $26,375 per day for 36 to 39
months. The charterer has an option for a further 11 to 13
months at a time charter rate of $27,375 per day. The charterer
has a second option for a further 11 to 13 months at a time
charter rate of $28,375 per day.
(6) The charter rate for the JAEGER may reset at the beginning of
each month based on the average time charter rate for the Baltic
Supramax Index, but in no case less than $22,500 per day.
(7) The charterer of the KESTREL I has exercised its option to
extend the charter period by 11 to 13 months at a daily time
charter rate of $20,000 per day.
(8) Upon conclusion of the current charter, the MERLIN commences a
new 36 to 39 month time charter. The daily rate is $27,000 for
the first year, $25,000 for the second year and $23,000 for the
third year. Revenue recognition is based on an average daily
rate of $25,000.
(9) The charterer of the OSPREY I has exercised its option to extend
the charter period by up to 11 to 13 months at a time charter
rate of $25,000 per day. The charterer has an additional option
to extend for a further 11 to 13 months at a time charter rate
of $25,000 per day.
(10) The SPARROW is on a time charter at a base rate of $24,000 per
day for 11 to 13 months with a profit share of 30% of up to the
first $3,000 per day over the base rate. Upon conclusion of the
charter, the SPARROW commences a new 24 to 26 month time charter
at a rate of $34,500 per day.
(11) The charterer of the TERN has exercised its option to extend the
charter period by 11 to 13 months at a time charter rate of
$20,500 per day.
(12) The Company took delivery of the SHRIKE on April 24, 2007 and
the vessel was immediately delivered to the charterer at a time
charter rate of $24,600 per day for 24 to 27 months. The
charterer has an option to extend the charter period by 12 to 14
months at a daily time charter rate of $25,600.
(13) The Company took delivery of the SKUA on June 20, 2007 and the
vessel was immediately delivered to the charterer at a time
charter rate of $24,200 per day for 23 to 25 months. The
charterer has an option to extend the charter period by 11 to 13
months at a daily time charter rate of $25,200.
(14) The Company took delivery of the KITTIWAKE on June 27, 2007 and
the vessel was immediately delivered to the charterer at a time
charter rate of $30,400 per day for 11 to 13 months. The charter
rate may reset at the beginning of each month based on the
average time charter rate for the Baltic Supramax Index, but in
no case less than $24,400 per day.
As of September 30, 2007, the Company has contracted for 31 vessels
to be constructed. The following table represents certain
information about the Company's newbuilding vessels and their
employment upon delivery:
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Daily
Vessel Dwt Year Time Charter Time
-------- --- Built - Employment Charter
Expected Expiration(2) Hire Profit
Delivery(1) ------------- Rate(3) Share
----------- ------- ------
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Crowned Eagle 56,000 Nov Charter Free -- --
2008
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Crested Eagle 56,000 Feb Charter Free -- --
2009
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Stellar Eagle 56,000 Apr Charter Free -- --
2009
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Golden Eagle 56,000 Jan Charter Free -- --
2010
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Imperial Eagle 56,000 Feb Charter Free -- --
2010
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Feb 2012 $24,750 --
Wren 53,100 Aug Feb 2012 to Dec 2018/ $18,000 50% over
2008 Apr 2019 $22,000
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Jan 2014 $18,300 --
Woodstar 53,100 Oct Jan 2014 to Dec 2018/ $18,000 50% over
2008 Apr 2019 $22,000
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Thrush 53,100 Sep Charter Free -- --
2009
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Thrasher 53,100 Nov Feb 2016 $18,400 --
2009 Feb 2016 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Avocet 53,100 Dec Mar 2016 $18,400 --
2009 Mar 2016 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Bittern 58,000 Sep Dec 2014 $18,850 --
2009 Dec 2014 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Canary 58,000 Oct Jan 2015 $18,850 --
2009 Jan 2015 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Crane 58,000 Nov Feb 2015 $18,850 --
2009 Feb 2015 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Egret(4) 58,000 Dec Sep 2012 to Jan 2013 $17,650 50% over
2009 $20,000
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Gannet(4) 58,000 Jan Oct 2012 to Feb 2013 $17,650 50% over
2010 $20,000
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Grebe(4) 58,000 Feb Nov 2012 to Mar 2013 $17,650 50% over
2010 $20,000
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Ibis (4) 58,000 Mar Dec 2012 to Apr 2013 $17,650 50% over
2010 $20,000
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Jay 58,000 Apr Sep 2015 $18,500 50% over
2010 $21,500
Sep 2015 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Kingfisher 58,000 May Oct 2015 $18,500 50% over
2010 $21,500
Oct 2015 to Dec 2018/ $18,000 50% over
Apr 2019 $22,000
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Martin 58,000 Jun Dec 2016 to Dec 2017 $18,400 --
2010
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Nighthawk 58,000 Mar Sep 2017 to Sep 2018 $18,400 --
2011
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Oriole 58,000 Jul Jan 2018 to Jan 2019 $18,400 --
2011
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Owl 58,000 Aug Feb 2018 to Feb 2019 $18,400 --
2011
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Petrel(4) 58,000 Sep Jun 2014 to Oct 2014 $17,650 50% over
2011 $20,000
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Puffin(4) 58,000 Oct Jul 2014 to Nov 2014 $17,650 50% over
2011 $20,000
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Roadrunner(4) 58,000 Nov Aug 2014 to Dec 2014 $17,650 50% over
2011 $20,000
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Sandpiper(4) 58,000 Dec Sep 2014 to Jan 2015 $17,650 50% over
2011 $20,000
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Snipe 58,000 Jan Charter Free -- --
2012
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Swift 58,000 Feb Charter Free -- --
2012
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Raptor 58,000 Mar Charter Free -- --
2012
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Saker 58,000 Apr Charter Free -- --
2012
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(1) Vessel build and delivery dates are estimates based on guidance
received from shipyard.
(2) The date range represents the earliest and latest date on which
the charterer may redeliver the vessel to the Company upon the
termination of the charter.
(3) The time charter hire rate presented are gross daily charter
rates before brokerage commissions ranging from 2.25% to 6.25% to
third party ship brokers.
(4) The charterer has an option to extend the charter by 2 periods of
11 to 13 months each.
Commercial and strategic management of the fleet is carried out by a wholly-owned subsidiary of the Company, Eagle Shipping International (USA) LLC, a Republic of the Marshall Islands limited liability company with offices in New York City.
Glossary of Terms:
Ownership days: The Company defines ownership days as the aggregate number of days in a period during which each vessel in its fleet has been owned. Ownership days are an indicator of the size of the fleet over a period and affect both the amount of revenues and the amount of expenses that is recorded during a period.
Available days: The Company defines available days as the number of ownership days less the aggregate number of days that its vessels are off-hire due to vessel familiarization upon acquisition, scheduled repairs or repairs under guarantee, vessel upgrades or special surveys and the aggregate amount of time that we spend positioning our vessels. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
Operating days: The Company defines operating days as the number of its available days in a period less the aggregate number of days that the vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
Conference Call and Webcast Information
As previously announced, members of Eagle Bulk's senior management team will host a teleconference and webcast at 8:30 a.m. ET on Thursday, November 8, 2007, to discuss the results.
To participate in the teleconference, investors and analysts are invited to call 800-295-4740 in the U.S., or 617-614-3925 outside of the U.S., and reference participant code 49478312. A simultaneous webcast of the call, including a slide presentation for interested investors and others, may be accessed by visiting the Company's website at: www.eagleships.com.
IMPORTANT: Investors participating in the teleconference are encouraged to access an accompanying slide presentation, which management will reference during the call. This presentation will be available at www.eagleships.com. A telephonic replay will be available following the call until 12:00 a.m. ET on November 15th, 2007. To access the replay, call 888-286-8010 in the U.S., or 617-801-6888 outside of the U.S., and reference passcode 71632247.
About Eagle Bulk Shipping Inc.
Eagle Bulk Shipping, Inc., headquartered in New York City, is a leading global owner of Supramax dry bulk vessels, which are dry bulk vessels that range in size from 50,000 to 60,000 deadweight tons, or dwt, and transport a broad range of major and minor bulk cargoes, including iron ore, coal, grain, cement and fertilizer, along worldwide shipping routes. Our strategy is to charter our modern fleet on medium- to long-term time charters which allow us to take advantage of the stable cash flow and high utilization rates that are associated with such charters.
Forward-Looking Statements
Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may 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 forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although Eagle Bulk Shipping Inc. 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 our control, Eagle Bulk Shipping Inc. cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.
Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydocking, changes in our vessel operating expenses, including dry-docking and insurance costs, or actions taken by regulatory authorities, potential liability from future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.
Risks and uncertainties are further described in reports filed by Eagle Bulk Shipping Inc. with the U.S. Securities and Exchange Commission.
Visit our website at www.eagleships.com