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DryShips Inc. 2Q19 report

Published by , Editorial Assistant
Dry Bulk,

DryShips Inc. an owner and operator of ocean going cargo vessels, and through the acquisition of Heidmar Inc., a global tanker pool operator, has announced its unaudited financial and operating results for the quarter ended 30 June 2019.

Second 2Q19 financial highlights

  • For the second quarter of 2019, the company reported net loss of USUS$12.7 million, or USUS$0.15 basic and diluted losses/share.
  • Included in the second quarter of 2019 results are the following:
    Vessel dry-docking costs of US$5.7 million, or USUS$0.07/share.
    Vessel impairments of US$1.5 million, or US$0.02/share.
  • Excluding the above, the company’s net results would have amounted to a net loss of US$5.5 million, or USUS$0.06 per share.
  • The company reported adjusted EBITDA of USUS$6.4 million for the second quarter of 2019.

Other developments

Further to the company’s plan to future proof its fleet, as of 17 September 2019, we have completed the dry-docking, installation of ballast water treatment systems (BWTS) and scrubbers on 7 vessels, incurring approximately US$26.1 million of total costs and 300 off-hire days. For the balance of 2019 and the full year 2020, we expect to continue to execute our plan to upgrade additional vessels and we expect to incur approximately 843 off-hire days for a total estimated cost of US$65.8 million.

In connection with the installation of scrubbers on our vessels we have entered into agreements, directly or indirectly, with internationally recognised financial institutions and/or export credit agencies to borrow up to US$36.4 million to partly finance such installations. The loans have not yet been drawn and they are guaranteed by entities that may be deemed to be affiliated with our Chairman and CEO, George Economou.

On 18 August 2019 the company entered into an agreement and plan of merger, by and among the company, SPII Holdings Inc., a company that may be deemed to be beneficially owned by the company’s Chairman and Chief Executive Officer, George Economou, and Sileo Acquisitions Inc., a wholly owned subsidiary of SPII. Pursuant to the merger agreement merger sub will be merged with and into the company, with the company continuing as the surviving corporation after the merger and a wholly owned subsidiary of SPII. Pursuant to the merger agreement, at the effective time of the merger, each share of the company common stock that is issued and outstanding immediately prior to the effective time will be automatically converted into the right to receive the merger consideration of US$5.25/share in cash, without interest and less any required withholding taxes. The company has called a special meeting of its shareholders to be held on 9 October 2019 at 4 pm, local time, at 80 Kifissias Avenue, GR 151 25, Marousi, Athens, Greece. At the special meeting, shareholders will be asked to consider and vote on a proposal to authorise and approve the merger agreement.

Only shareholders of record as of the close of business on 30 August 2019, which has been fixed as the record date for the special meeting, will be entitled to vote at the special meeting. The merger is also subject to the satisfaction or waiver of other customary closing conditions but not to any financing condition. The merger is expected to close in the fourth 4Q19.

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