Genco Shipping announces 4Q16 results

• Recorded a net loss attributable to Genco Shipping & Trading Limited of US$24.5 million for the fourth quarter of 2016.
• Basic and diluted loss per share of US$3.35.
• Closed our US$400 million credit facility on November 15, 2016.
• Refinances all of our existing credit facilities with the exception of the US$98 million Credit Facility and the 2014 Term Loan Facilities.
• No significant fixed amortisation payments until 2019.
• Elimination of collateral maintenance covenants through the first half of 2018.
• Completed the sale of an aggregate of US$125 million of Series A Preferred Stock at a price of US$4.85 per share on 15 November, 2016 and the conversion of the Preferred Stock to common stock on 4 January, 2017.
• Delivered four vessels to buyers during the fourth quarter of 2016.
• Sold the Genco Sugar, the Genco Pioneer, the Genco Leader and the Genco Acheron, achieving net proceeds of US$11.5 million.
• In 2017 to date we have delivered three additional vessels to buyers.
• Sold the Genco Wisdom, the Genco Carrier and the Genco Reliance for total net proceeds of US$10.0 million, which will be recorded as cash on the balance sheet.
• Entered into agreements to sell the last two of the ten vessels identified for sale, the Genco Prosperity and the Genco Success, for total net proceeds of US$5.7 million.
• Vessels to be delivered to their buyers by 30 June, 2017, and net proceeds to be recorded as cash on the balance sheet.

Financial review: 2016 fourth quarter

The company recorded a net loss attributable to Genco Shipping & Trading Limited for the fourth quarter of 2016 of US$24.5 million, or US$3.35 basic and diluted net loss per share. Comparatively, for the three months ended 31 December, 2015, the Company recorded a net loss attributable to Genco Shipping & Trading Limited of US$49.5 million, or US$6.86 basic and diluted net loss per share. Basic and diluted net loss per share for both periods has been adjusted for the one-for-ten reverse stock split of Genco’s common stock effected on 7 July, 2016.

The company’s revenues increased to US$43.9 million for the three months ended 31 December, 2016, compared to US$35.0 million for the three months ended 31 December, 2015. The increase was primarily due to higher spot market rates achieved by the majority of the vessels in our fleet during the fourth quarter of 2016 versus the same period last year.

Apostolos Zafolias, Chief Financial Officer, commented:

“We are pleased to have completed our capital raise and closed on our new credit facility in the fourth quarter. This success has significantly increased our liquidity position and strengthened Genco’s balance sheet, providing Genco with a strong financial foundation for the future. In addition, the favorable terms of our new credit facility, combined with our cost saving initiatives, have allowed us to significantly reduce Genco’s cash break-even levels.” 

Financial Review: twelve months 2016

The company recorded a net loss attributable to Genco Shipping & Trading Limited of US$217.2 million or US$29.95 basic and diluted net loss per share for the twelve months ended 31 December, 2016. This compares to a net loss attributable to Genco Shipping & Trading Limited of US$194.9 million or US$29.61 basic and diluted net loss per share for the twelve months ended 31 December, 2015. Basic and diluted net loss per share for both periods has been adjusted for the one-for-ten reverse stock split of Genco’s common stock effected on 7 July, 2016. Net income for the twelve months ended 31 December, 2016 and 2015, includes non-cash vessel impairment charges of US$69.3 million and US$39.9 million, respectively. Revenues decreased to US$135.6 million for the twelve months ended 31 December, 2016 compared to US$154.0 million for the twelve months ended 31 December, 2015 due to lower spot market rates achieved by the majority of our vessels. TCE rates obtained by the company decreased to US$4907 per day for the twelve months ended 31 December, 2016 from US$5445 per day for the twelve months ended December 31, 2015, due to lower rates achieved by the majority of the vessels in our fleet. Total operating expenses for the twelve months ended 31 December, 2016 and 2015 were US$321.5 million and US$346.8 million, respectively. Excluding non-cash vessel impairment charges totalling US$69.3 million relating to the revaluation of ten vessels to their estimated net realisable value, our adjusted total operating expenses were US$252.2 million for the twelve months ended 31 December, 2016. This compares to adjusted total operating expenses, which excludes a non-cash vessel impairment charge of US$35.4 million relating to the sale of the Baltic Tiger and the Baltic Lion in April 2015 as well as a US$4.5 million non-cash impairment charge to adjust the value of the Genco Marine to its fair value as of 31 December, 2015, of US$306.9 million for the twelve months ended 31 December, 2015.

The company believe the presentation of the adjusted amounts above is useful to investors in understanding our current performance and financial condition, as it excludes items that may not be indicative of its core operating results. General and administrative expenses for 2016 decreased to US$23.9 million as compared to US$32.8 million for 2015. Daily vessel operating expenses per vessel were US$4514 versus US$4870 in the comparative periods due to lower expenses related to maintenance as well as crewing and insurance.

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