United Maritime Corporation (“United” or the “Company”) (NASDAQ:
USEA), announced today its financial results for the first quarter
ended March 31, 2023 and declared a quarterly dividend of $0.075
per share for the first quarter of 2023.
For the quarter ended March 31, 2023, the
Company generated net revenues of $2.8 million and recorded a
negative Adjusted EBITDA1 of $1.5 million. Net Loss and Adjusted
Net Loss for the quarter were $4.9 million and $3.7 million,
respectively. The Time Charter Equivalent rate (“TCE rate”) of the
fleet for the first quarter of 2023 was $10,294 per day.
Cash and cash-equivalents as of March 31, 2023
stood at $20.0 million. Shareholders’ equity at the end of the
first quarter was $61.9 million, while long-term debt, lease
liability and other financial liabilities net of deferred charges
stood at $69.5 million as of March 31, 2023. The book value of our
fleet as of March 31, 2023, stood at $117.0 million, including a
chartered-in Panamax vessel and the advance paid for the
acquisition of one Kamsarmax vessel.
Stamatis Tsantanis, the Company’s
Chairman & Chief Executive Officer, stated:
“Following the highly profitable sales of three
of our tankers by the end of 2022, our average fleet size in Q1
2023 was reduced to less than 3 ships including our remaining
tanker vessel which was drydocked for its special survey for most
of the first quarter. Our profitable ship disposals affected our
quarterly operating results, recording an average daily TCE of
$10,294. However, we swiftly executed transactions to re-grow our
fleet through the acquisition of six dry bulk vessels for
approximately $126 million. We have fully funded the acquisition of
these two Capesize and two Kamsarmax vessels and the down payments
on the two chartered-in Panamax vessels without diluting our
shareholders.
“Within February and March, we took delivery of
four dry bulk vessels, two Capesize, one Panamax and one Kamsarmax,
with an additional Kamsarmax delivered in April and one more
Panamax expected to be delivered in the third quarter of the year.
In addition, our tanker has been operational since the beginning of
Q2, following the completion of her special survey.
“In the second quarter to date, we have covered
71% of our ownership days at an average TCE of $18,856 per day2 and
we estimate our daily net TCE to average at approximately $18,000.
This will exceed by 75% the average of the first quarter, over a
fleet that will be double in size and operating days.
“Looking forward, on a fully-delivered basis, we
will operate a fleet of seven dry bulk vessels and one tanker
vessel, with moderate levels of leverage and satisfactory levels of
liquidity, allowing us to focus on further growth opportunities as
well as shareholder rewards.
“In this context, we are pleased to announce
another regular cash dividend distribution for the first quarter,
bringing the total cash dividends that have been declared in the
last six months to $1.15 per share, which represents a cash yield
of about 40% compared to the recent closing price of our stock. The
cash dividend amounts of $8.7 million, combined with approximately
$6 million in buybacks of common shares completed in 2022,
aggregate to shareholder rewards of $14.7 million, or 62% of our
market cap as of May 16, 2023, within the past nine months.
Considering the favorable fundamentals of the dry bulk market and
the solid financial and commercial standing of United, we remain
optimistic that the quarterly cash dividend we have paid for the
previous two quarters can be sustained or increased during the rest
of the year.”
_______________1 Adjusted net loss per share,
Adjusted net loss and negative Adjusted EBITDA are non-GAAP
measures. Please see the reconciliation below of Adjusted loss per
share, Adjusted net loss, and negative Adjusted EBITDA to net
income, the most directly comparable U.S. GAAP measure.2 Please
refer to our detailed Second Quarter 2023 TCE Guidance and footnote
3 below.
Current Company
Fleet:
Vessel Name |
Sector |
Capacity (DWT) |
Year Built |
Yard |
Employment Type |
Minimum T/C expiration |
Maximum T/C expiration(1) |
Gloriuship |
Dry Bulk / Capesize |
171,314 |
2004 |
Hyundai |
T/C Index Linked(2) |
Feb-24 |
Jun-24 |
Goodship |
Dry Bulk / Capesize |
177,536 |
2005 |
Mitsui |
T/C Index Linked(2) |
Jun-23 |
Dec-23 |
Tradership |
Dry Bulk / Capesize |
176,925 |
2006 |
Namura |
T/C Index Linked(2) |
Aug-24 |
Jan-25 |
Chrisea(3) |
Dry Bulk / Panamax |
78,173 |
2013 |
Shin Kurushima |
T/C Index Linked(2) |
Feb-24 |
Jun-24 |
Oasea |
Dry Bulk / Kamsarmax |
82,217 |
2010 |
Thuneishi |
T/C Index Linked(2) |
Mar-24 |
Jul-24 |
Cretansea |
Dry Bulk / Kamsarmax |
81,508 |
2009 |
Universal |
T/C Index Linked(2) |
Apr-24 |
Jul-24 |
Epanastasea |
Tanker / LR2 |
109,647 |
2008 |
Dalian |
Fixed Rate T/C(4) |
Sep-23 |
Nov-23 |
Total/Average age |
|
877,320 |
15.2 years |
|
|
|
|
(1) The latest redelivery dates do not include
any additional optional periods.(2) “T/C” refers to a time charter
agreement. Under these index-linked T/Cs, the Company has the
option to convert the index-linked rate to fixed for periods
ranging between 1 and 12 months, based on the prevailing FFA Rates
for the selected period, and has done so for certain vessels as
part of its freight hedging strategy, as described below under
“Second Quarter 2023 TCE Guidance.”(3) The vessel is technically
and commercially operated by the Company on the basis of an
18-month bareboat charter-in contract with the owners of the
vessel, including a purchase option at the end of the bareboat
charter in favour of the Company.(4) The daily charter hire is
currently $40,000 until the expiration of the charterparty.
Fleet to be
delivered*:
Vessel Name |
Sector |
Capacity (DWT) |
Year Built |
Yard |
tbr Synthesea |
Dry Bulk / Panamax |
78,020 |
2015 |
Sasebo |
*The M/V Synthesea is expected to be delivered
to the Company between July and October 2023. The vessel will be
technically and commercially operated by United on the basis of a
12-month bareboat charter-in contract with the owners of the
vessel, including a purchase option at the end of the bareboat
charter in favour of the Company.
Fleet Data:
(Amounts in U.S. Dollars)
|
Q1 2023 |
Ownership days(1) |
|
305 |
|
Operating days(2) |
|
245 |
|
Fleet utilization(3) |
|
80.3 |
% |
TCE rate(4) |
$ |
10,294 |
|
Daily Vessel Operating Expenses(5) |
$ |
7,764 |
|
(1) Ownership days are the total number of
calendar days in a period during which the vessels in a fleet have
been owned or chartered in. Ownership days are an indicator of the
size of the Company’s fleet over a period and affect both the
amount of revenues and the amount of expenses that the Company
recorded during a period.(2) Operating days are the number of
available days in a period less the aggregate number of days that
the vessels are off-hire due to unforeseen circumstances. Operating
days include the days that our vessels are in ballast voyages
without having finalized agreements for their next employment.(3)
Fleet utilization is the percentage of time that the vessels are
generating revenue and is determined by dividing operating days by
ownership days for the relevant period.(4) TCE rate is defined as
the Company’s net revenue less voyage expenses during a period
divided by the number of the Company’s operating days during the
period. Voyage expenses include port charges, bunker (fuel oil and
diesel oil) expenses, canal charges and other commissions. The
Company includes the TCE rate, a non-GAAP measure, as it believes
it provides additional meaningful information in conjunction with
net revenues from vessels, the most directly comparable U.S. GAAP
measure, and because it assists the Company’s management in making
decisions regarding the deployment and use of our vessels and
because the Company believes that it provides useful information to
investors regarding our financial performance. The Company’s
calculation of TCE rate may not be comparable to that reported by
other companies. The following table reconciles the Company’s net
revenues from vessels to the TCE rate.
(In thousands of U.S. Dollars, except operating days and TCE
rate)
|
Q1 2023 |
|
Vessel revenue, net |
|
2,821 |
|
Less:
Voyage expenses |
|
299 |
|
Time
charter equivalent revenues |
|
2,522 |
|
Operating days |
|
245 |
|
TCE
rate |
$ |
10,294 |
|
(5) Vessel operating expenses include crew
costs, provisions, deck and engine stores, lubricants, insurance,
maintenance and repairs. Daily Vessel Operating Expenses are
calculated by dividing vessel operating expenses, excluding pre
delivery costs of acquired vessels, by ownership days for the
relevant time periods. The Company’s calculation of daily vessel
operating expenses may not be comparable to that reported by other
companies. The following table reconciles the Company’s vessel
operating expenses to daily vessel operating expenses.
(In thousands of U.S. Dollars, except ownership days and Daily
Vessel Operating Expenses)
|
Q1 2023 |
|
Vessel operating expenses |
|
3,111 |
|
Less:
Pre-delivery expenses |
|
743 |
|
Vessel
operating expenses before pre-delivery expenses |
|
2,368 |
|
Ownership days |
|
305 |
|
Daily
Vessel Operating Expenses |
$ |
7,764 |
|
Net Loss to EBITDA and Adjusted EBITDA
Reconciliation:
(In thousands of U.S. Dollars)
|
Q1 2023 |
|
Net loss |
(4,887 |
) |
Add: Interest and finance costs, net |
970 |
|
Add: Depreciation and amortization |
1,226 |
|
EBITDA |
(2,691 |
) |
Add: Stock based compensation |
1,218 |
|
Adjusted EBITDA |
(1,473 |
) |
Earnings Before Interest, Taxes, Depreciation
and Amortization (“EBITDA”) represents the sum of net income, net
interest and finance costs, depreciation and amortization and, if
any, income taxes during a period. EBITDA is not a recognized
measurement under U.S. GAAP. Adjusted EBITDA represents EBITDA
adjusted to exclude stock-based compensation, which the Company
believes is not indicative of the ongoing performance of its core
operations.
EBITDA and Adjusted EBITDA are presented as we
believe that this measure is useful to investors as a widely used
means of evaluating operating profitability. EBITDA and Adjusted
EBITDA as presented here may not be comparable to similarly titled
measures presented by other companies. This non-GAAP measure should
not be considered in isolation from, as a substitute for, or
superior to, financial measures prepared in accordance with U.S.
GAAP.
Net Loss and Adjusted Net Loss
Reconciliation and calculation of Adjusted Loss Per
Share
(In thousands of U.S. Dollars)
|
Q1 2023 |
|
Net loss |
(4,887 |
) |
Add: Stock based compensation |
1,218 |
|
Adjusted net loss |
(3,669 |
) |
Adjusted net loss – common stockholders, basic and diluted |
(3,729 |
) |
Adjusted loss per common share, basic and diluted |
(0.48 |
) |
Weighted average number of common shares outstanding, basic and
diluted |
7,766,681 |
|
To derive Adjusted Net Income/(Loss) and
Adjusted Earnings/(Loss) Per Share from Net Income/(Loss), we
exclude certain non-cash items, as provided in the table above. We
believe that Adjusted Net Income/(Loss) and Adjusted
Earnings/(Loss) Per Share assist our management and investors by
increasing the comparability of our performance from period to
period since each such measure eliminates the effects of such
non-cash items as stock based compensation, loss on extinguishment
of debt and other items which may vary from year to year, for
reasons unrelated to overall operating performance. In addition, we
believe that the presentation of the respective measure provides
investors with supplemental data relating to our results of
operations, and therefore, with a more complete understanding of
factors affecting our business than with GAAP measures alone. Our
method of computing Adjusted Net Income/(Loss) and Adjusted
Earnings/(Loss) Per Share may not necessarily be comparable to
other similarly titled captions of other companies due to
differences in methods of calculation.
Interest and Finance Costs to Cash
Interest and Finance Costs Reconciliation:
(In thousands of U.S. Dollars)
|
Q1 2023 |
|
Interest and finance costs, net |
(970 |
) |
Add: Amortization of deferred finance charges and other
discounts |
174 |
|
Cash interest and finance costs |
(796 |
) |
Second Quarter 2023 TCE Guidance:
As of the date hereof, approximately 71% of the
Company fleet’s expected operating days in the second quarter of
2023 have been fixed at an estimated TCE of approximately $18,856.
Assuming that for the remaining operating days of our index-linked
T/Cs, the respective vessels’ TCE will be equal to the average
Forward Freight Agreement (“FFA”) rate of $16,376 per day (based on
the FFA curve of May 12, 2023), our estimated TCE for the second
quarter of 2023 will be approximately $17,9233. Our TCE guidance
for the second quarter of 2023 includes conversions of index-linked
charter to fixed, which were concluded in Q1 2023 as part of our
freight hedging strategy. The following table provides the
break-down:
|
Operating Days |
TCE |
TCE - fixed rate (index-linked conversion) |
182 |
16,115.45 |
TCE - fixed rate |
87 |
38,284.78 |
TCE – index-linked unhedged |
336 |
13,617.62 |
Total / Average |
605 |
17,922.61 |
_______________3 This guidance is based on certain assumptions
and there can be no assurance that these TCE estimates, or
projected utilization will be realized. TCE estimates include
certain floating (index) to fixed rate conversions concluded in
previous periods. For vessels on index-linked T/Cs, the TCE
realized will vary with the underlying index, and for the purposes
of this guidance, the TCE assumed for the remaining operating days
of the quarter for an index-linked T/C is equal to the weighted
average of the Capesize (BCI) and Panamax (BPI) FFA rate of $16,376
based on the curve of May 12, 2023. Spot estimates are provided
using the load-to-discharge method of accounting. The rates quoted
are for days currently contracted. Increased ballast days at the
end of the quarter will reduce the additional revenues that can be
booked based on the accounting cut-offs and therefore the resulting
TCE will be reduced accordingly.
First Quarter and Recent Developments:
Dividend Distribution for Q4 2022 and
Declaration of Q1 2023 Dividend
On April 6, 2023, the Company paid the
previously announced quarterly dividend of $0.075 per share, for
the fourth quarter of 2022, to all shareholders of record as of
March 22, 2023.
Committed to its dividend strategy, the Company
also declared a cash dividend of $0.075 per share for the first
quarter of 2023 payable on or about July 6, 2023 to the
shareholders of record as of June 22, 2023.
Vessel transactions and commercial
updates
Delivery of M/V Goodship and M/V
Tradership
In February 2023, the Company took delivery of
the 177,536 dwt M/V Goodship built in 2005 in Japan and the 176,925
dwt M/V Tradership built in 2006 in Japan. The two Capesize vessels
were acquired for an aggregate price of $36.25 million, which was
funded by the Company’s cash reserves, including a
cash-collateralized $15.2 million loan previously secured by the
LR2 tanker that was sold in December 2022. The M/V Goodship is
chartered by an international charterer for a period until minimum
June 2023 up to maximum December 2023, at an index-linked rate. The
M/V Tradership is chartered by a major European charterer for a
period until minimum August 2024 up to maximum January 2025, at an
index-linked rate.
Delivery of M/V Oasea and M/V
Cretansea
In March 2023, the Company took delivery of the
82,217 dwt M/V Oasea built in 2010 in China. The M/V Oasea was
acquired for a gross purchased price of $19.5 million, which was
funded by cash on hand and through the March 2023 Sale and
Leaseback. The M/V Oasea is chartered by a major European charterer
for a period until minimum March 2024 up to maximum July 2024, at
an index-linked rate.
In April 2023, the Company took delivery of the
81,508 dwt M/V Cretansea built in 2009 in Japan. The M/V Cretansea
was acquired for a gross purchased price of $19.7 million, which
was funded by cash on hand and through the March 2023 Sale and
Leaseback. The M/V Cretansea is chartered by a major European
charterer for a period until minimum April 2024 up to maximum July
2024, at an index-linked rate.
Bareboat Agreement for a Panamax bulk
carrier – M/V Chrisea
In February 2023, the Company entered into a
bareboat charter agreement for the 2013 Japanese-built Panamax bulk
carrier, which was renamed M/V Chrisea. The vessel is chartered by
the Company under an 18-month bareboat charter agreement, with a
down payment of $7.0 million, a daily charter rate of $7,300 over
the period of the bareboat charter and a purchase option of $12.4
million at the end of the bareboat charter. In aggregate, the
acquisition cost for the vessel, following exercise of the purchase
option, will be approximately $23.4 million.
Bareboat Agreement for a Panamax bulk
carrier – M/V Synthesea
In April 2023, the Company entered into a
bareboat charter agreement for the 78,020 dwt Panamax bulk carrier
built in 2015 in Japan Panamax bulk carrier, which will be renamed
M/V Synthesea. The vessel will be chartered by the Company under a
12-month bareboat charter agreement, with a down payment of $3.5
million (already paid), a further down payment of $3.5 million due
at vessel’s delivery, expected between July and October 2023, a
daily charter rate of $8,000 over the period of the bareboat
charter and a purchase option of $17.1 million at the end of the
bareboat charter. In aggregate, the acquisition cost for the
vessel, following exercise of the purchase option, will be
approximately $27.0 million.
M/T Epanastasea Employment
Update
From February 6 until April 7, 2023, the
Epanastasea underwent its scheduled dry-docking survey in China.
Upon completion the vessel resumed its employment under its current
time charter contract with Abu Dhabi National Oil Company earning a
fixed daily rate of $40,000.
In view of the continued strength of vessel
values in the tanker market, the Company is actively considering
selling the vessel and is currently in advanced discussions with
prospective buyers.
Financing Updates
March 2023 Sale and
Leaseback
On each of March 31 and April 26, 2023,
following the deliveries of the M/V Oasea and the M/V Cretansea,
the Company entered into a $24.5 million sale-and leaseback
facility provided by a European lessor to finance part of the
acquisition cost of the vessels. The financing amount for each
vessel is $12.25 million bearing an interest rate of 4.25% plus
3-month Term SOFR. The charterhire principal for each vessel
amortizes over a five-year term, through sixty consecutive monthly
instalments of $0.1 million. The Company has the option to
repurchase the vessels at any time during their respective bareboat
periods and a purchase obligation at a price of $6.4 million per
vessel at maturity.
Update on Number of Common Shares Issued
and Outstanding
As of May 17, 2023, the Company has 8,959,443
common shares issued and outstanding. This includes 1,037,230
shares issued pursuant to exercises of Class A warrants for
aggregate proceeds of $2.7 million.
Conference
Call:
The Company’s management will host a conference
call to discuss the financial results today, Thursday, May 18, 2023
at 10:00 a.m. Eastern Time.
Audio
Webcast:
There will be a live, and then archived, webcast
of the conference call through the Company’s website. To listen to
the archived audio file, visit our website, in the “Investors”
section. Participants to the live webcast should register on the
website approximately 10 minutes prior to the start of the webcast,
following this link.
Conference Call
Details:
Participants have the option to register for the
call using the following link. You can use any number from the list
or add your phone number and let the system call you right
away.
United Maritime
CorporationUnaudited Condensed Consolidated Balance
Sheets(In thousands of U.S. Dollars)
|
|
March 31, 2023 |
|
|
|
December 31,2022* |
|
ASSETS |
|
|
|
|
|
|
|
Cash and cash equivalents and restricted cash |
|
20,001 |
|
|
|
69,932 |
|
Vessels and right-of-use assets, net and advances for vessels’
acquisitions |
|
117,028 |
|
|
|
50,200 |
|
Other assets |
|
5,332 |
|
|
|
5,523 |
|
TOTAL ASSETS |
|
142,361 |
|
|
|
125,655 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Long-term debt, lease liability and other financial liabilities,
net of deferred finance costs |
|
69,455 |
|
|
|
42,606 |
|
Other liabilities |
|
10,963 |
|
|
|
18,481 |
|
Stockholders’ equity |
|
61,943 |
|
|
|
64,568 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
142,361 |
|
|
|
125,655 |
|
|
|
|
|
|
|
|
|
* Derived from the audited consolidated financial statements as
of the period as of that date
United Maritime
CorporationUnaudited Condensed Consolidated Statements of
Operations (In thousands of U.S. Dollars, except for share and per
share data, unless otherwise stated)
|
Three months period ended March 31, 2023 |
Vessel revenue, net |
2,821 |
|
Expenses: |
|
|
Voyage expenses |
(299 |
) |
Vessel operating expenses |
(3,111 |
) |
Management fees |
(232 |
) |
General and administrative expenses |
(1,819 |
) |
Depreciation and amortization |
(1,226 |
) |
Operating
loss |
(3,866 |
) |
Other
expenses: |
|
|
Interest and finance costs, net |
(970 |
) |
Other, net |
(51 |
) |
Total other expenses,
net: |
(1,021 |
) |
Net loss |
(4,887 |
) |
Net loss attributable
to common stockholders |
(4,947 |
) |
|
|
|
Net loss per common
share, basic and diluted |
(0.64 |
) |
Weighted average
number of common shares outstanding, basic and
diluted |
7,766,681 |
|
|
|
|
United Maritime
CorporationUnaudited Condensed Consolidated Cash Flow Data
(In thousands of U.S. Dollars)
|
Three months ended March 31, 2023 |
Net cash used in operating activities |
|
(4,060 |
) |
Net cash used in investing activities |
|
(52,135 |
) |
Net cash provided by financing activities |
|
6,264 |
|
|
|
|
|
About United Maritime Corporation
United Maritime Corporation is an international
shipping company specializing in worldwide seaborne transportation
services. The Company operates a fleet of one LR2 tanker vessel and
seven dry bulk vessels, comprising one Panamax, three Capesize and
two Kamsarmax vessels. Upon completion of the delivery of one
Panamax vessel, the Company’s operating fleet will consist of eight
vessels (1 LR2 tanker, 3 Capesize, 2 Kamsarmax and 2 Panamax), with
an aggregate cargo carrying capacity of 955,340 dwt.
The Company is incorporated under the laws of
the Republic of the Marshall Islands and has executive offices in
Glyfada, Greece. The Company's common shares trade on the Nasdaq
Capital Market under the symbol “USEA”.
Please visit the Company’s website at:
www.unitedmaritime.gr
Forward-Looking Statements
This 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. Words such as "may",
"should", "expects", "intends", "plans", "believes", "anticipates",
"hopes", "estimates" and variations of such words and similar
expressions may identify forward-looking statements, but the
absence of these words does not mean that a statement is not
forward-looking. These statements involve known and unknown risks
and are based upon a number of assumptions and estimates, which 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, shipping
industry trends, including charter rates, vessel values and factors
affecting vessel supply and demand; the impact of changes in
regulatory requirements or actions taken by regulatory authorities
on the Company's operating or financial results; the Company's
financial condition and liquidity, including its ability to service
its indebtedness or to pay dividends; competitive factors in the
market in which the Company operates; increased operating costs
associated with vessel aging; vessel damage; future, pending or
recent acquisitions and dispositions, business strategy, areas of
possible expansion or contraction, and expected capital spending or
operating expenses; dependence on affiliates of the Company’s
former parent and third-party managers to operate the Company’s
business; availability of crew, number of off-hire days,
classification survey requirements and insurance costs; changes in
the Company’s relationships with contract counterparties; potential
liability from future litigation and incidents involving the
Company’s vessels; broader market impacts arising from war (or
threatened war) or international hostilities, such as between
Russia and Ukraine; risks associated with the length and severity
of the ongoing novel coronavirus (COVID-19) outbreak, including its
effects on demand for crude oil, petroleum products, dry bulk
products, other types of products and the transportation thereof;
and other factors listed from time to time in the Company's filings
with the SEC, including its registration statement on Form 20-F.
The Company's filings can be obtained free of charge on the SEC's
website at www.sec.gov. Except to the extent required by law, 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.
For further information please contact:
United Investor RelationsTel: +30 213 0181 522E-mail:
ir@usea.gr
Capital Link, Inc.Paul Lampoutis230 Park Avenue Suite 1540New
York, NY 10169Tel: (212) 661-7566E-mail: usea@capitallink.com
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