Euroseas Ltd. (NASDAQ: ESEA, the “Company” or “Euroseas”), an owner
and operator of container carrier vessels and provider of seaborne
transportation for containerized cargoes, announced today its
results for the three-month period ended March 31, 2023 and
declared a common stock dividend.
First Quarter 2023 Financial
Highlights:
- Total net revenues of $41.9
million.
- Net income of $28.8 million or
$4.11 and $4.10 earnings per share basic and diluted,
respectively.
- Adjusted net income1 for the period
was $21.7 million or $3.10 and $3.09 per share basic and diluted,
respectively.
- Adjusted EBITDA1 was $26.0
million.
- An average of 17.1 vessels were
owned and operated during the first quarter of 2023 earning an
average time charter equivalent rate of $29,231 per day. Refer
to a subsequent section of the Press Release for the definition and
method of calculation of time charter equivalent rate.
- Declared a quarterly dividend of
$0.50 per share for the first quarter of 2023 payable on or about
June 16, 2023 to shareholders of record on June 9, 2023, as part of
the Company’s common stock dividend plan.
- As of May 16, 2023 we had
repurchased 348,419 of our common stock in the open market for a
total of about $7.0 million, since the initiation of our share
repurchase plan of up to $20 million announced in May 2022.
- As previously announced, on April
6, 2023, the Company took delivery of its first newbuilding M/V
“Gregos”, an eco 2,800 teu feeder containership from Hyundai Mipo
Dockyard Co. in South Korea. The vessel is EEDI Phase 3 compliant
and equipped with a Tier III engine and other sustainability linked
features including installation of AMP (alternative maritime
power). The acquisition was financed with a combination of own
funds and a sustainability-linked loan provided by Eurobank S.A.
Following its delivery, M/V “Gregos” commenced a thirty-six to
forty month charter with Asyad Lines.
__________________1 Adjusted EBITDA, Adjusted
net income and Adjusted earnings per share are not recognized
measurements under US GAAP (GAAP) and should not be used in
isolation or as a substitute for Euroseas financial results
presented in accordance with GAAP. Refer to a subsequent section of
the Press Release for the definitions and reconciliation of these
measurements to the most directly comparable financial measures
calculated and presented in accordance with GAAP.
Aristides Pittas, Chairman and CEO of
Euroseas commented: “During the first quarter and through
mid-May of 2023, containership charter rates staged a comeback of
15-20% compared to the low levels reached, for most segments,
during February of 2023. During the same period, we were able to
re-charter two of our vessels whose contracts expired for two and
three-year long charters at rates higher than originally
anticipated reflecting the resilience of the market and the
apparent belief of charterers that feeder vessels will be in short
supply. This is likely a reflection of the fact that, while the
overall orderbook of the fleet looms at around 30%, the orderbook
for vessels with capacity less than 6000 teu, i.e. the segment we
mainly operate, is around 11%; the latter fact coupled with the
larger percentage of vessels older than 20 years suggest that the
fleet could even decline in that segment. Of course, as we
mentioned on several occasions previously, the larger vessels
establish the overall trends in the market but, nevertheless, the
better supply dynamics for the feeder and intermediate size vessels
should provide a certain degree of comfort for owners like
Euroseas.
“The larger comfort for Euroseas, though, lies
with our charter coverage which runs well into 2025 and amounts to
about $400 million of contracted revenues. In terms of coverage,
our fleet is contracted in excess of 90% for the remaining of 2023
and in excess of 65% for 2024. Our contracted revenues alone over
2023 and 2024 are expected to generate earnings in excess of $20
per share which will be further increased by the revenues from our
yet unchartered days.
“We remain focused on efficiently operating our
fleet, reducing our carbon footprint, and taking delivery of our
remaining eight newbuilding vessels while at the same time looking
and evaluating investment opportunities with minimal residual value
risk that are accretive to our earnings. In parallel, we continue
rewarding our shareholders by declaring a $0.50 a share quarterly
dividend and executing on our share repurchase program which we
believe represents one of the best investment opportunities as our
shares trade at less than half of their intrinsic value.”
Tasos Aslidis, Chief Financial Officer
of Euroseas commented: “In a market environment where
charter rates have significantly slid compared to last year, our
net revenues decreased only slightly to $41.9 million in the first
quarter of 2023 compared to $45.4 million during the same period of
last year. This was due to the fact that most of our vessels are
employed in time charter contracts booked before the decline of the
market rates started. During the first quarter of 2023, we operated
17.1 vessels versus 16.0 vessels during the same period of last
year.
“On a per-vessel-per-day basis, our vessels
earned a 14.0% lower average time charter equivalent rates in the
first quarter of 2023 as compared to the same period of 2022.
Again, on a per-vessel-per-day basis, the sum of vessel operating
expenses, management fees and general and administrative expenses
increased by 10.2% during the first quarter of 2023 as compared to
the same period in 2022 which was attributable to the higher prices
for all the categories of vessel supplies paid for our vessels
compared to the same period of 2022. We believe that we continue to
maintain one of the lowest operating cost structures amongst the
public shipping companies which is one of our competitive
advantages.
“Adjusted EBITDA during the first quarter of
2023 was $26.0 million compared to $31.1 million achieved for the
first quarter of 2022.
“Finally, as of March 31, 2023, our outstanding
debt (excluding the unamortized loan fees) is about $121.0 million
versus restricted and unrestricted cash of about $33.9
million.” First
Quarter 2023 Results:For the first quarter of 2023, the
Company reported total net revenues of $41.9 million representing a
7.6% decrease over total net revenues of $45.4 million during the
first quarter of 2022. On average, 17.1 vessels were owned and
operated during the first quarter of 2023 earning an average time
charter equivalent rate of $29,231 per day compared to 16.0 vessels
in the same period of 2022 earning on average $33,986 per day. The
Company reported a net income for the period of $28.8 million, as
compared to a net income of $29.9 million for the first quarter of
2022.
Vessel operating expenses for the first quarter
of 2023 amounted to $9.8 million as compared to $8.4 million for
the same period of 2022. The increased amount is due to the higher
number of vessels owned and operated in the first quarter of 2023
compared to the corresponding period of 2022, as well as due to
inflationary increases, resulting in higher prices being paid for
all the categories of vessel supplies. Depreciation expense for the
first quarter of 2023 amounted to $5.3 million compared to $3.7
million for the same period of 2022 due to the increased number of
vessels in the Company’s fleet and the fact that the new vessels
acquired in the second quarter of 2022 have a higher average daily
depreciation charge as a result of their higher acquisition price
compared to the remaining vessels. Related party management fees
for the first quarter of 2023 increased to $1.4 million from $1.2
million for the same period of 2022 as a result of the higher
number of vessels in our fleet and the adjustment for inflation in
the daily vessel management fee, effective from January 1, 2023,
increasing it from 720 Euros to 775 Euros, partly offset by the
favorable movement of the euro/dollar exchange rate.
In the first quarter of 2023 one of our vessels
completed her special survey with drydock for a total cost of $0.6
million. In the first quarter of 2022 two of our vessels completed
their intermediate survey in water and one of our vessels completed
her special survey with drydock for a total cost of $1.8 million.
Finally, during the first quarter of 2023 and 2022, we had other
operating income of $1.3 million and other operating expenses of
$0.35 million, respectively. The operating income for 2023 relates
to loss of hire insurance for two of our vessels. For the same
period of 2022 the other operating expenses relate to settlement of
accounts with charterers. The results of the Company for the first
quarter of 2023 include a $5.2 million gain on sale of M/V “Akinada
Bridge” that was completed in January 2023. General and
administrative expenses increased to $1.1 million in the first
quarter of 2023, as compared to $1.0 million in the same period of
2022, mainly due to the increased cost of our stock incentive
plan.
Interest and other financing costs for the first
quarter of 2023 amounted to $0.9 million, partly offset by
capitalized interest of $1.1 million charged on the cost of our
newbuilding program, for a total cost of other finance and interest
of $2.0 million, as compared to interest and other financing costs
of 1.0 million for the same period of 2022. This increase is due to
the increased amount of debt and the increase in the weighted
average LIBOR / SOFR rate in the current period compared to the
same period of 2022. For the three months ended March 31, 2023 the
Company recognized a $0.24 million loss on its interest rate swap
contracts, comprising a $0.36 million realized gain and a $0.60
million unrealized loss. For the three months ended March 31, 2022
the Company recognized a $2.34 million gain on its interest rate
swap contracts, comprising a $0.04 million realized loss and a
$2.38 million unrealized gain.
Adjusted EBITDA1 for the first quarter of 2023
was $26.0 million, compared to $31.1 million achieved for the first
quarter of 2022. Please see below for Adjusted EBITDA
reconciliation to net income.
Basic and diluted earnings per share for the
first quarter of 2023 was $4.11 and $4.10, respectively, calculated
on 6,998,213 basic and 7,014,090 diluted weighted average number of
shares outstanding compared to basic and diluted earnings per share
of $4.15 and $4.13, respectively, calculated on 7,221,941 basic and
7,254,593 diluted weighted average number of shares
outstanding.
Excluding the effect on the income for the
quarter of the unrealized loss on derivatives the amortization of
below market time charters acquired, the depreciation charged due
to the increased value of the vessel acquired with below market
time charter and the gain on sale of vessel (if any), the adjusted
earnings per share for the quarter ended March 31, 2023 would have
been $3.10 and $3.09 per share basic and diluted, respectively,
compared to adjusted earnings of $3.71 and $3.70 per share basic
and diluted, respectively, for the first quarter of 2022. Usually,
security analysts do not include the above items in their published
estimates of earnings per share.
Fleet Profile: The Euroseas Ltd. fleet profile
is as follows:
Name |
Type |
Dwt |
TEU |
Year Built |
Employment(*) |
TCE Rate ($/day) |
Container Carriers |
|
|
|
|
|
|
MARCOS V |
Intermediate |
72,968 |
6,350 |
2005 |
TC until Dec-24plus 12 months option |
$42,200option $15,000 |
SYNERGY BUSAN (*) |
Intermediate |
50,726 |
4,253 |
2009 |
TC until Aug-24 |
$25,000 |
SYNERGY ANTWERP (+) |
Intermediate |
50,726 |
4,253 |
2008 |
TC until Dec-23 |
$18,000 |
SYNERGY OAKLAND (*) |
Intermediate |
50,787 |
4,253 |
2009 |
TC until May-26 |
$42,000 |
SYNERGY KEELUNG (*) |
Intermediate |
50,969 |
4,253 |
2009 |
TC until Apr-25 |
$23,000 |
EMMANUEL P (ex. SEASPAN MELBOURNE) (*) |
Intermediate |
50,796 |
4,250 |
2005 |
TC until Mar-25 |
$19,000 |
RENA P (ex. SEASPAN MANILA) (*) |
Intermediate |
50,796 |
4,250 |
2007 |
TC until Mar-24then until Feb-25 |
$20,250 CONTEX(**) basis with $13,000 floor and $21,000
ceiling |
EM KEA (*) |
Feeder |
42,165 |
3,100 |
2007 |
TC until May-23 then until May-26 |
$22,000$19,000 |
GREGOS (*) |
Feeder |
37,237 |
2,800 |
2023 |
TC until Mar-26 |
$48,000 |
EM ASTORIA (*) |
Feeder |
35,600 |
2,788 |
2004 |
until Feb-24then until Feb-25 |
$50,000$20,000 |
EVRIDIKI G (*) |
Feeder |
34,677 |
2,556 |
2001 |
TC until Feb-25 |
$40,000 |
EM CORFU (*) |
Feeder |
34,654 |
2,556 |
2001 |
TC until Feb-25 |
$40,000 |
DIAMANTIS P (*) |
Feeder |
30,360 |
2,008 |
1998 |
TC until Oct-24 |
$27,000 |
EM SPETSES (*) |
Feeder |
23,224 |
1,740 |
2007 |
TC until Aug-24 |
$29,500 |
JONATHAN P (*) |
Feeder |
23,357 |
1,740 |
2006 |
TC until Sep-24 |
$26,662(***) |
EM HYDRA (*) |
Feeder |
23,351 |
1,740 |
2005 |
TC until Apr-24 |
$15,000 |
JOANNA (*) |
Feeder |
22,301 |
1,732 |
1999 |
TC until May-23 |
$14,500 |
AEGEAN EXPRESS (*) |
Feeder |
18,581 |
1,439 |
1997 |
TC until Aug-23 |
$13,000 |
Total Container Carriers |
18 |
703,275 |
56,061 |
|
|
|
Vessels under construction |
Type |
Dwt |
TEU |
To be delivered |
Employment |
TCE Rate ($/day) |
TERATAKI (*) (H4202) |
Feeder |
37,237 |
2,800 |
Q3 2023 |
TC until Jul-26 |
$48,000 |
TENDER SOUL (H4236) |
Feeder |
37,237 |
2,800 |
Q1 2024 |
|
|
LEONIDAS Z (H4237) |
Feeder |
37,237 |
2,800 |
Q2 2024 |
|
|
MONICA (H4248) |
Feeder |
22,262 |
1,800 |
Q2 2024 |
|
|
STEPHANIA K (H4249) |
Feeder |
22,262 |
1,800 |
Q2 2024 |
|
|
PEPI STAR (H4250) |
Feeder |
22,262 |
1,800 |
Q2 2024 |
|
|
DEAR PANEL (H4251) |
Feeder |
37,237 |
2,800 |
Q4 2024 |
|
|
SYMEON P (H4252) |
Feeder |
37,237 |
2,800 |
Q4 2024 |
|
|
Total vessels under construction |
8 |
252,971 |
19,400 |
|
|
|
Note: (*)(+) TC denotes time charter. Charter
duration indicates the earliest redelivery date; All dates listed
are the earliest redelivery dates under each TC unless the contract
rate is lower than the current market rate in which cases the
latest redelivery date is assumed; vessels with the latest
redelivery date shown are marked by (+).
(**) The CONTEX (Container Ship Time Charter
Assessment Index) has been published by the Hamburg and Bremen
Shipbrokers’ Association (VHBS) since October 2007. The CONTEX is a
company-independent index of time charter rates for containerships.
It is based on assessments of the current day charter rates of six
selected containership types, which are representative of their
size categories: Type 1,100 TEU and Type 1,700 TEU with a charter
period of one year, and the Types 2,500, 2,700, 3,500 and 4,250 TEU
all with a charter period of two years.
(***) Rate is net of commissions (which are
typically 5-6.25%)
Summary Fleet Data:
|
Three Months, Ended March 31, 2022 |
|
Three Months, Ended March 31,2023 |
|
FLEET DATA |
|
|
Average number of vessels (1) |
16.00 |
|
17.10 |
|
Calendar days for fleet (2) |
1,440.0 |
|
1,539.0 |
|
Scheduled off-hire days incl. laid-up (3) |
52.4 |
|
- |
|
Available days for fleet (4) = (2) - (3) |
1,387.6 |
|
1,539.0 |
|
Commercial off-hire days (5) |
5.3 |
|
28.9 |
|
Operational off-hire days (6) |
6.3 |
|
37.0 |
|
Voyage days for fleet (7) = (4) - (5) - (6) |
1,376.0 |
|
1,473.1 |
|
Fleet utilization (8) = (7) / (4) |
99.2 |
% |
95.7 |
% |
Fleet utilization, commercial (9) = ((4) - (5)) / (4) |
99.6 |
% |
98.1 |
% |
Fleet utilization, operational (10) = ((4) - (6)) / (4) |
99.5 |
% |
97.6 |
% |
|
|
|
AVERAGE DAILY RESULTS (usd/day) |
|
|
Time charter equivalent rate (11) |
33,986 |
|
29,231 |
|
Vessel
operating expenses excl. drydocking expenses (12) |
6,646 |
|
7,333 |
|
General
and administrative expenses (13) |
683 |
|
741 |
|
Total vessel operating expenses (14) |
7,329 |
|
8,074 |
|
Drydocking expenses (15) |
1,242 |
|
387 |
|
(1) Average number of vessels is the number of
vessels that constituted the Company’s fleet for the relevant
period, as measured by the sum of the number of calendar days each
vessel was a part of the Company’s fleet during the period divided
by the number of calendar days in that period.
(2) Calendar days. We define calendar days as
the total number of days in a period during which each vessel in
our fleet was in our possession including off-hire days associated
with major repairs, drydockings or special or intermediate surveys
or days of vessels in lay-up. Calendar days are an indicator of the
size of our fleet over a period and affect both the amount of
revenues and the amount of expenses that we record during that
period.(3) The scheduled off-hire days including vessels laid-up
are days associated with scheduled repairs, drydockings or special
or intermediate surveys or days of vessels in lay-up.(4) Available
days. We define available days as the Calendar days in a period net
of scheduled off-hire days incl. laid up. We use available days to
measure the number of days in a period during which vessels were
available to generate revenues. (5) Commercial off-hire days.
We define commercial off-hire days as days a vessel is idle without
employment.(6) Operational off-hire days. We define operational
off-hire days as days associated with unscheduled repairs or other
off-hire time related to the operation of the vessels.(7) Voyage
days. We define voyage days as the total number of days in a period
during which each vessel in our fleet was in our possession net of
commercial and operational off-hire days. We use voyage days to
measure the number of days in a period during which vessels
actually generate revenues or are sailing for repositioning
purposes.(8) Fleet utilization. We calculate fleet utilization by
dividing the number of our voyage days during a period by the
number of our available days during that period. We use fleet
utilization to measure a company's efficiency in finding suitable
employment for its vessels and minimizing the amount of days that
its vessels are off-hire for reasons such as unscheduled repairs or
days waiting to find employment. (9) Fleet utilization,
commercial. We calculate commercial fleet utilization by dividing
our available days net of commercial off-hire days during a period
by our available days during that period. (10) Fleet
utilization, operational. We calculate operational fleet
utilization by dividing our available days net of operational
off-hire days during a period by our available days during that
period. (11) Time charter equivalent rate, or TCE, is a
measure of the average daily net revenue performance of our
vessels. Our method of calculating TCE is determined by dividing
time charter revenue and voyage charter revenue net of voyage
expenses by voyage days for the relevant time period. Voyage
expenses primarily consist of port, canal and fuel costs that are
unique to a particular voyage, which would otherwise be paid by the
charterer under a time charter contract, or are related to
repositioning the vessel for the next charter. TCE is a standard
shipping industry performance measure used primarily to compare
period-to-period changes in a shipping company's performance
despite changes in the mix of charter types (i.e., spot voyage
charters, time charters, pool agreements and bareboat charters)
under which the vessels may be employed between the periods. Our
definition of TCE may not be comparable to that used by other
companies in the shipping industry.(12) Daily vessel operating
expenses, which include crew costs, provisions, deck and engine
stores, lubricating oil, insurance, maintenance and repairs and
related party management fees are calculated by dividing vessel
operating expenses and management fees by fleet calendar days for
the relevant time period. Drydocking expenses are reported
separately. (13) Daily general and administrative expense is
calculated by dividing general and administrative expenses by fleet
calendar days for the relevant time period. (14) Total vessel
operating expenses, or TVOE, is a measure of our total expenses
associated with operating our vessels. TVOE is the sum of vessel
operating expenses, related party management fees and general and
administrative expenses; drydocking expenses are not included.
Daily TVOE is calculated by dividing TVOE by fleet calendar days
for the relevant time period.(15) Drydocking expenses include
expenses during drydockings that would have been capitalized and
amortized under the deferral method divided by the fleet calendar
days for the relevant period. Drydocking expenses could vary
substantially from period to period depending on how many vessels
underwent drydocking during the period. The Company expenses
drydocking expenses as incurred.
Conference Call and Webcast:
Today, Tuesday, May 16, 2023 at 11:00 a.m. Eastern Time, the
Company's management will host a conference call and webcast to
discuss the results.
Conference Call details:
Participants should dial into the call 10
minutes before the scheduled time using the following numbers: 877
405 1226 (US Toll-Free Dial In) or +1 201 689 7823 (US and Standard
International Dial In). Please quote “Euroseas” to the operator
and/or conference ID13738857.Click here for additional participant
international Toll- Free access numbers.
Alternatively, participants can register for the
call using the call me option for a faster connection to join the
conference call. You can enter your phone number and let the system
call you right away. Click here for the call me option.
Audio Webcast - Slides
Presentation: There will be a live and then archived
audio webcast of the conference call, via the internet through the
Euroseas website (www.euroseas.gr). Participants to the live
webcast should register on the website approximately 10 minutes
prior to the start of the webcast.
The slide presentation on the first quarter
ended March 31, 2023 will also be available in PDF format 10
minutes prior to the conference call and webcast, accessible on the
company's website (www.euroseas.gr) on the webcast page.
Participants to the webcast can download the PDF
presentation.
|
Euroseas Ltd. Unaudited Consolidated
Condensed Statements of Operations(All amounts
expressed in U.S. Dollars except number of shares) |
|
|
|
|
Three Months EndedMarch 31, |
Three Months Ended March 31, |
|
2022 |
2023 |
|
|
|
Revenues |
|
|
Time charter revenue |
47,119,092 |
|
43,459,926 |
|
Commissions |
(1,745,554 |
) |
(1,523,309 |
) |
Net revenues |
45,373,538 |
|
41,936,617 |
|
|
|
|
Operating expenses / (income) |
|
|
Voyage expenses |
354,024 |
|
399,746 |
|
Vessel operating expenses |
8,398,893 |
|
9,844,217 |
|
Drydocking expenses |
1,787,926 |
|
595,368 |
|
Vessel depreciation |
3,721,116 |
|
5,274,583 |
|
Related party management fees |
1,172,032 |
|
1,440,575 |
|
Gain on sale of vessel |
- |
|
(5,158,370 |
) |
General and administrative expenses |
983,072 |
|
1,140,647 |
|
Other operating expenses / (income) |
350,000 |
|
(1,290,000 |
) |
Total operating expenses, net |
16,767,063 |
|
12,246,766 |
|
|
|
|
Operating income |
28,606,475 |
|
29,689,851 |
|
|
|
|
Other income / (expenses) |
|
|
Interest and other financing costs |
(1,014,431 |
) |
(887,671 |
) |
Gain / (loss) on derivatives, net |
2,342,517 |
|
(244,250 |
) |
Foreign exchange gain / (loss) |
1,052 |
|
(34,670 |
) |
Interest income |
681 |
|
231,348 |
|
Other income / (expenses), net |
1,329,819 |
|
(935,243 |
) |
|
|
|
Net income |
29,936,294 |
|
28,754,608 |
|
Earnings per share, basic |
4.15 |
|
4.11 |
|
Weighted average number of shares, basic |
7,221,941 |
|
6,998,213 |
|
Earnings per share, diluted |
4.13 |
|
4.10 |
|
Weighted average number of shares, diluted |
7,254,593 |
|
7,014,090 |
|
|
Euroseas Ltd.Unaudited
Consolidated Condensed Balance Sheets(All amounts
expressed in U.S. Dollars – except number of
shares) |
|
|
December 31, 2022 |
March 31,2023 |
|
|
|
ASSETS |
|
|
Current
Assets: |
|
|
Cash and cash equivalents |
25,845,333 |
29,824,554 |
|
Trade accounts receivable |
572,961 |
1,630,905 |
|
Other receivables |
5,515,311 |
9,394,337 |
|
Inventories |
2,306,177 |
2,536,646 |
|
Restricted cash |
2,193,173 |
144,846 |
|
Prepaid expenses |
350,206 |
520,957 |
|
Due from related company |
32,146 |
157,599 |
|
Derivatives |
1,142,682 |
784,865 |
|
Asset held for sale |
8,909,172 |
- |
|
Total current assets |
46,867,161 |
44,994,709 |
|
Fixed
assets: |
|
|
Vessels, net |
216,570,426 |
211,762,925 |
|
Long-term
assets: |
|
|
Advances for vessels under construction |
59,083,594 |
97,969,984 |
|
Restricted cash |
3,400,000 |
3,900,000 |
|
Derivatives |
2,669,244 |
2,425,461 |
|
Total assets |
328,590,425 |
361,053,079 |
|
|
|
|
LIABILITIES, MEZZANINE
EQUITY AND SHAREHOLDERS' EQUITY |
|
|
Current
liabilities: |
|
|
Long-term bank loans, current portion |
55,419,815 |
50,525,251 |
|
Trade accounts payable |
5,160,068 |
5,676,192 |
|
Liability associated with asset held for sale |
3,556,641 |
- |
|
Accrued expenses |
1,756,383 |
1,691,080 |
|
Accrued dividends |
66,375 |
108,500 |
|
Deferred revenue |
7,730,422 |
10,519,662 |
|
Total current
liabilities |
73,689,704 |
68,520,685 |
|
|
|
|
Long-term
liabilities: |
|
|
Long-term bank loans, net of current portion |
51,812,086 |
69,592,946 |
|
Fair value of below market time charters acquired |
34,933,438 |
31,135,923 |
|
Total long-term
liabilities |
86,745,524 |
100,728,869 |
|
Total
liabilities |
160,435,228 |
169,249,554 |
|
|
|
|
Shareholders’
equity: |
|
|
|
Common stock (par value $0.03, 200,000,000 shares authorized,
7,116,206 and 7,013,122, issued and outstanding) |
213,486 |
|
210,394 |
|
Additional paid-in capital |
260,539,222 |
|
258,973,518 |
|
Accumulated deficit |
(92,597,511 |
) |
(67,380,387 |
) |
Total shareholders’ equity |
168,155,197 |
|
191,803,525 |
|
Total liabilities and shareholders’ equity |
328,590,425 |
|
361,053,079 |
|
|
Euroseas Ltd.Unaudited Consolidated
Condensed Statements of Cash Flows (All
amounts expressed in U.S. Dollars) |
|
|
Three Months Ended March 31, |
|
Three Months Ended March 31, |
|
|
2022 |
|
2023 |
|
|
|
|
Cash flows from operating activities: |
|
|
Net income |
29,936,294 |
|
28,754,608 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
Vessel depreciation |
3,721,116 |
|
5,274,583 |
|
Amortization of deferred
charges |
83,496 |
|
92,296 |
|
Share-based compensation |
214,559 |
|
337,167 |
|
Gain on sale of vessel |
- |
|
(5,158,370 |
) |
Unrealized (gain) / loss on
derivatives |
(2,383,764 |
) |
601,600 |
|
Amortization of fair value of
below market time charters acquired |
(1,218,240 |
) |
(3,797,515 |
) |
Changes in operating assets
and liabilities |
(130,692 |
) |
(1,353,666 |
) |
Net cash provided by operating
activities |
30,222,769 |
|
24,750,703 |
|
|
|
|
Cash flows from
investing activities: |
|
|
Cash paid for vessels under
construction |
(1,732 |
) |
(39,487,240 |
) |
Cash paid for vessels
acquisitions and capitalized expenses |
(281,300 |
) |
(43,249 |
) |
Cash paid for vessel
improvements |
(403,928 |
) |
(271,739 |
) |
Net
proceeds from sale of a vessel |
- |
|
10,100,598 |
|
Net cash used in investing activities |
(686,960 |
) |
(29,701,630 |
) |
Cash flows from financing activities: |
|
|
Cash paid for share
repurchase |
- |
|
(1,859,943 |
) |
Dividends paid |
- |
|
(3,495,359 |
) |
Loan arrangement fees
paid |
- |
|
(221,000 |
) |
Offering expenses paid |
(27,838 |
) |
(56,877 |
) |
Proceeds from long-term bank
loans |
- |
|
26,000,000 |
|
Repayment of long-term bank
loans |
(6,885,460 |
) |
(12,985,000 |
) |
Net cash (used in) / provided by financing
activities |
(6,913,298 |
) |
7,381,821 |
|
|
|
|
Net increase in cash, cash
equivalents, and restricted cash |
22,622,511 |
|
2,430,894 |
|
Cash,
cash equivalents, and restricted cash at beginning of period |
31,498,229 |
|
31,438,506 |
|
Cash, cash
equivalents, and restricted cash at end of period |
54,120,740 |
|
33,869,400 |
|
Cash breakdown |
|
|
Cash and cash equivalents |
49,151,500 |
|
29,824,554 |
|
Restricted cash, current |
169,240 |
|
144,846 |
|
Restricted cash, long term |
4,800,000 |
|
3,900,000 |
|
Total cash, cash equivalents, and restricted cash shown in
the statement of cash flows |
54,120,740 |
|
33,869,400 |
|
|
|
|
|
Euroseas Ltd.Reconciliation of Net Income
to Adjusted EBITDA (All amounts expressed in U.S.
Dollars) |
|
|
Three Months EndedMarch 31,
2022 |
Three Months EndedMarch 31,
2023 |
Net income |
29,936,294 |
|
28,754,608 |
|
Interest and other financing costs, net (incl. interest
income) |
1,013,750 |
|
656,323 |
|
Vessel depreciation |
3,721,116 |
|
5,274,583 |
|
Gain on sale of vessel |
- |
|
(5,158,370 |
) |
(Gain) / loss on interest rate swap derivatives, net |
(2,342,517 |
) |
244,250 |
|
Amortization of below market time charters acquired |
(1,218,240 |
) |
(3,797,515 |
) |
Adjusted EBITDA |
31,110,403 |
|
25,973,879 |
|
|
|
|
|
|
Adjusted EBITDA
Reconciliation:
Euroseas Ltd. considers Adjusted EBITDA to
represent net income before interest, income taxes, depreciation,
(gain) / loss on interest rate swap derivatives, gain on sale of
vessel and amortization of below market time charters acquired.
Adjusted EBITDA does not represent and should not be considered as
an alternative to net income, as determined by United States
generally accepted accounting principles, or GAAP. Adjusted EBITDA
is included herein because it is a basis upon which the Company
assesses its financial performance and liquidity position and
because the Company believes that this non-GAAP financial measure
assists our management and investors by increasing the
comparability of our performance from period to period by excluding
the potentially disparate effects between periods of, financial
costs, (gain) / loss on interest rate swaps, gain on sale of
vessel, depreciation and amortization of below market time charters
acquired. The Company's definition of Adjusted EBITDA may not be
the same as that used by other companies in the shipping or other
industries.
|
Euroseas Ltd.Reconciliation of Net Income
to Adjusted Net Income(All amounts expressed in
U.S. Dollars except share data and per share amounts) |
|
|
Three Months EndedMarch 31,
2022 |
Three Months EndedMarch 31,
2023 |
Net income |
29,936,294 |
|
28,754,608 |
|
Unrealized (gain) / loss on derivatives |
(2,383,764 |
) |
601,600 |
|
Gain on sale of vessel |
- |
|
(5,158,370 |
) |
Amortization of below market time charters acquired |
(1,218,240 |
) |
(3,797,515 |
) |
Depreciation on the portion of the consideration of vessels
acquired with attached time charters allocated to below market time
charters |
494,808 |
|
1,278,771 |
|
Adjusted net income |
26,829,098 |
|
21,679,094 |
|
Adjusted earnings per share, basic |
3.71 |
|
3.1 |
|
Weighted average number of shares, basic |
7,221,941 |
|
6,998,213 |
|
Adjusted earnings per share, diluted |
3.70 |
|
3.09 |
|
Weighted average number of shares, diluted |
7,254,593 |
|
7,014,090 |
|
|
|
|
|
|
Adjusted net income and Adjusted
earnings per share Reconciliation:Euroseas Ltd. considers
Adjusted net income to represent net income before unrealized
(gain) / (loss) on derivatives, net gain on sale of vessel,
amortization of below market time charters acquired and vessel
depreciation on the portion of the consideration of vessels
acquired with attached time charters allocated to below market time
charters. Adjusted net income and Adjusted earnings per share are
included herein because we believe they assist our management and
investors by increasing the comparability of the Company's
fundamental performance from period to period by excluding the
potentially disparate effects between periods of the aforementioned
items, which may significantly affect results of operations between
periods.
Adjusted net income and Adjusted earnings per
share do not represent and should not be considered as an
alternative to net income or earnings per share, as determined by
GAAP. The Company's definition of Adjusted net income and Adjusted
earnings per share may not be the same as that used by other
companies in the shipping or other industries. Adjusted net income
and Adjusted earnings per share are not adjusted for all non-cash
income and expense items that are reflected in our statement of
cash flows.
About Euroseas Ltd.Euroseas
Ltd. was formed on May 5, 2005 under the laws of the Republic of
the Marshall Islands to consolidate the ship owning interests of
the Pittas family of Athens, Greece, which has been in the shipping
business over the past 140 years. Euroseas trades on the NASDAQ
Capital Market under the ticker ESEA.
Euroseas operates in the container shipping
market. Euroseas' operations are managed by Eurobulk Ltd., an ISO
9001:2008 and ISO 14001:2004 certified affiliated ship management
company, which is responsible for the day-to-day commercial and
technical management and operations of the vessels. Euroseas
employs its vessels on spot and period charters and through pool
arrangements.
The Company has a fleet of 18 vessels, including
11 Feeder containerships and 7 Intermediate containerships.
Euroseas 18 containerships have a cargo capacity of 56,061 teu.
After the delivery of eight feeder containership newbuildings in
2023 and 2024, Euroseas’ fleet will consist of 26 vessels with a
total carrying capacity of 75,461 teu.
Forward Looking StatementThis
press release contains forward-looking statements (as defined in
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended) concerning
future events and 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, 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 containerships, 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 publicly 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.
Visit the Company’s website
www.euroseas.gr
Company Contact |
Investor Relations / Financial Media |
Tasos AslidisChief Financial
OfficerEuroseas Ltd.11 Canterbury Lane,Watchung, NJ 07069Tel. (908)
301-9091E-mail: aha@euroseas.gr |
Nicolas BornozisMarkella
KaraCapital Link, Inc.230 Park Avenue, Suite 1540New York, NY
10169Tel. (212) 661-7566E-mail: euroseas@capitallink.com |
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