HAMILTON, Bermuda, Nov. 7, 2023
/PRNewswire/ -- Ardmore Shipping Corporation (NYSE: ASC)
("Ardmore", the "Company" or "we") today announced results for the
three and nine months ended September 30, 2023.
Highlights and Recent Activity
- Reported net income of $20.3
million for the three months ended September 30, 2023, or $0.49 earnings per basic and diluted share,
compared to net income of $61.0
million, or $1.57 earnings per
basic share and $1.52 earnings per
diluted share for the three months ended September 30, 2022. We reported Adjusted earnings
of $20.3 million for the three months
ended September 30, 2023, or
$0.49 Adjusted earnings per basic and
diluted share, compared to Adjusted earnings of $61.6 million for the three months ended
September 30, 2022, or $1.59 Adjusted earnings per basic share and
$1.54 Adjusted earnings per diluted
share (see Adjusted earnings in the Non-GAAP Measures
section).
- Reported net income and of $87.3
million for the nine months ended September 30, 2023, or $2.12 earnings per basic share and $2.09 earnings per diluted share, compared to net
income of $82.0 million, or
$2.27 earnings per basic and
$2.22 earnings per diluted share, for
the nine months ended September 30,
2022. We reported Adjusted earnings of $87.3 million for the nine months ended
September 30, 2023, or $2.12 Adjusted earnings per basic share and
$2.09 Adjusted earnings per diluted
share, compared to Adjusted earnings of $89.6 million for the nine months ended
September 30, 2022, or $2.48 Adjusted earnings per basic share and
$2.43 Adjusted earnings per diluted
share (see Adjusted earnings in the Non-GAAP Measures
section).
- Consistent with the Company's variable dividend policy of
paying out dividends on its shares of common stock equal to
one-third of Adjusted earnings, the Board of Directors declared a
cash dividend on November 7, 2023, of
$0.16 per common share for the
quarter ended September 30, 2023. The
dividend will be paid on December 15,
2023, to all shareholders of record on November 30, 2023.
- MR tankers earned an average spot TCE rate of $28,493 per day for the three months ended
September 30, 2023. Chemical tankers
earned an average TCE rate of $20,023
per day for the three months ended September
30, 2023. Based on approximately 50% total revenue days
currently fixed for the fourth quarter of 2023, the average spot
TCE rate is approximately $30,100 per
day for MR tankers; based on approximately 60% of revenue days
fixed for the fourth quarter of 2023, the average TCE rate for
chemical tankers is approximately $23,000 per day.
- In the third quarter of 2023, we completed the installation of
modular, carbon capture-ready scrubbers on two vessels during
scheduled drydockings.
Anthony Gurnee, the Company's
Chief Executive Officer, commented:
"MR and chemical tanker charter markets have remained robust
through the typically slow summer months, with strong momentum
leading into the seasonally stronger winter season. In
addition, the combination of low refined product inventories and
increasing geopolitical risk has led to recurring stretches of
pronounced market volatility. Meanwhile, tanker supply growth
remains constrained, with limited newbuilding deliveries and tight
shipyard capacity through at least 2026.
In this operating environment, Ardmore's strategic priorities
have been very consistent, including executing on the Company's
long-standing capital allocation policy. While we continue to
assess potential growth opportunities on an ongoing basis, we have
instead placed emphasis on the very high returns offered by the
installation of performance optimization and decarbonization
technologies onboard our existing fleet, all while paying our
shareholders an attractive quarterly dividend and reducing our
financial leverage. We believe Ardmore's consistent focus on
performance and progress places it in a strong position to continue
building value, not just via spot exposure in these robust markets,
but also via operational and financial efficiency over the
long-term."
Summary of Recent and Third Quarter 2023 Events
Fleet
Fleet Operations and Employment
As of September 30, 2023, the Company had 26 vessels
in operation (including four chartered-in vessels), consisting of
20 MR tankers ranging from 45,000 deadweight tonnes (dwt) to 49,999
dwt (15 Eco-Design and five Eco-Mod) and six Eco-Design IMO 2
product/chemical tankers ranging from 25,000 dwt to 37,800 dwt. The
Company also commercially manages one of Carl Büttner's 24,000 dwt
chemical tankers.
MR Tankers (45,000 dwt – 49,999 dwt)
At the end of the third quarter of 2023, the Company had 20 MR
tankers in operation, all of which were trading in the spot market.
The MR tankers earned an average TCE rate of $28,493 per day in the third quarter of 2023. In
the third quarter of 2023, the Company's 15 MR Eco-Design tankers
earned an average TCE rate of $25,932
and the Company's five MR Eco-Mod tankers earned an average TCE
rate of $36,362 per day.
In the fourth quarter of 2023, the Company expects to have all
revenue days for its MR tankers employed in the spot market. As of
November 7, 2023, the Company had
fixed approximately 50% of its total MR revenue days for the
fourth quarter of 2023 at an average TCE rate of approximately
$30,100 per day, which includes MR
Eco-Design tankers at $30,800 per day
and MR Eco-Mod tankers at $28,500 per
day.
Product / Chemical Tankers (IMO 2: 25,000 dwt –
37,800 dwt)
At the end of the third quarter of 2023, the Company had six
Eco-Design IMO 2 product / chemical tankers in operation, all of
which were trading in the spot market. During the third quarter of
2023, the Company's six Eco-Design product / chemical vessels
earned an average TCE rate of $20,023
per day.
In the fourth quarter of 2023, the Company expects to have all
revenue days for its Eco-Design IMO 2 product / chemical
tankers employed in the spot market. As of November 7, 2023, the Company had fixed
approximately 60% of its Eco-Design IMO 2 product / chemical
tankers revenue days for the fourth quarter of 2023 at an
average TCE rate of approximately $23,000 per day.
Drydocking
The Company had 151 drydocking days in the third quarter of
2023. The Company is currently scheduled to have 108
drydocking days in the fourth quarter of 2023.
Dividend on Common Shares
Consistent with the Company's variable dividend policy of paying
out dividends on its shares of common stock equal to one-third of
Adjusted earnings, as calculated for dividends (see Adjusted
earnings (for purposes of dividend calculations) in the Non-GAAP
Measures section), the Board of Directors declared a cash dividend
on November 7, 2023,
of $0.16 per common share for the quarter ended
September 30, 2023. The dividend will be paid
on December 15, 2023, to all shareholders of record
on November 30, 2023.
Scrubber Installations
In the third quarter of 2023, the Company completed the
installation of modular, carbon capture-ready scrubbers on two
vessels during their scheduled drydockings. Prior to the end of
2024, the Company intends to install scrubber systems on an
additional seven vessels during their scheduled drydockings.
Geopolitical Conflict
The ongoing conflict in Ukraine
has disrupted energy supply chains, caused instability and
significant volatility in the global economy and resulted in
economic sanctions by several nations. The ongoing conflict has
contributed significantly to related increases in spot tanker
rates.
Geopolitical tensions have escalated further on a global basis,
including the ongoing Israel-Hamas conflict. Escalation or
expansion of hostilities or such crisis, interventions by other
groups or nations, the impositions of economic sanctions,
disruption of shipping trade routes, or similar outcomes could
affect the price of crude oil and the oil industry, the tanker
industry, demand for the Company's services, its business, results
of operations, financial condition and cash flows.
Please see "Item 3. Key Information--Risk Factors" in the
Company's Annual Report on Form 20-F for information about risks to
the Company and its business relating to political instability,
terrorist or other attacks, war or international hostilities and
the conflict in Ukraine.
Results for the Three Months Ended
September 30, 2023 and 2022
The Company reported net income of $20.3
million for the three months ended
September 30, 2023, or $0.49 earnings per basic and diluted share, as
compared to net income of $61.0
million, or $1.57 earnings per
basic and $1.52 earnings per diluted
share for the three months ended September 30, 2022.
Results for the Nine Months Ended
September 30, 2023 and 2022
The Company reported net income of $87.3
million for the nine months ended
September 30, 2023, or $2.12 earnings per basic share and $2.09 earnings per diluted share, as compared to
net income of $82.0 million, or
$2.27 earnings per basic and
$2.22 earnings per diluted share for
the nine months ended September 30, 2022.
Management's Discussion and Analysis of Financial Results for
the Three Months Ended September 30, 2023 and
2022
Revenue. Revenue for the three months ended
September 30, 2023 was $86.9
million, a decrease of $55.5
million from $142.4 million
for the three months ended September 30, 2022.
The Company's average number of operating vessels was 26.0 for
the three months ended September 30, 2023, compared to
27.0 for the three months ended September 30, 2022.
The Company had 2,185 spot revenue days for the
three months ended September 30, 2023, as compared
to 2,374 for the three months ended September 30, 2022.
The Company had 26 vessels employed directly in the spot market as
of September 30, 2023 and 2022. Changes in spot rates
resulted in a decrease in revenue of $42.9
million and the decrease in spot revenue days resulted
in a decrease in revenue of $11.2
million for the three months ended
September 30, 2023, as compared to the three months ended
September 30, 2022.
The Company had no product tankers employed under time charter
as of September 30, 2023, as compared to one as of
September 30, 2022. There were no revenue days derived
from time charters for the three months ended
September 30, 2023, as compared to 92 for the three
months ended September 30, 2022. The decrease in revenue
days for time-chartered vessels resulted in a decrease in revenue
of $1.4 million.
Voyage Expenses. Voyage expenses were $30.6 million for the three months ended
September 30, 2023, a decrease of $15.4 million from $46.0
million for the three months ended
September 30, 2022. The overall decrease included a
$14.6 million decrease from lower
bunker prices and a $1.0 million
decrease in port and agency expenses plus commission costs.
TCE Rate. The average TCE rate for the Company's
fleet was $26,347 per day for the
three months ended September 30, 2023, a decrease of
$13,961 per day from $40,308 per day for the three months ended
September 30, 2022. The decrease in average TCE rate was
primarily the result of lower spot rates for the three months
ended September 30, 2023, as compared to the three months
ended September 30, 2022, which was partially offset by a
decrease in bunker prices. TCE rates represent net revenues (a
non-GAAP measure representing revenue less voyage expenses) divided
by revenue days. Net revenue utilized to calculate TCE is
determined on a discharge-to-discharge basis, which is different
from how we record revenue under U.S. GAAP.
Vessel Operating Expenses. Vessel operating
expenses were $14.4 million for the
three months ended September 30, 2023, an increase
of $1.1 million from $13.3 million for the
three months ended September 30, 2022. This increase was
driven by a change in technical manager for four vessels, as well
as the timing of certain vessel operating expenses between
quarters. Vessel operating expenses, by their nature, are prone to
fluctuations between periods.
Charter Hire Costs. Total charter hire
expense was $4.1 million for the
three months ended September 30, 2023, a decrease of
$0.4 million from $4.5 million for the three months ended
September 30, 2022. This decrease is the result of the
Company having an average of 4.0 vessels chartered-in during the
three months ended September 30, 2023, compared to an
average of 4.5 vessels chartered-in for the three months ended
September 30, 2022. Total charter hire expense for the
three months ended September 30, 2023 was comprised of an
operating expense component of $2.1
million and a vessel lease expense component of $2.0 million.
Depreciation. Depreciation expense for the
three months ended September 30, 2023 was
$6.9 million, a decrease of
$0.4 million from $7.3 million for the three months ended
September 30, 2022. This decrease is attributable to the
change in the scrap value of each vessel from $300 per lightweight ton ("lwt") to $400 per lwt during the first quarter of
2023.
Amortization of Deferred Drydock Expenditures.
Amortization of deferred drydock expenditures for the
three months ended September 30, 2023 was
$0.7 million, a decrease of
$0.3 million from $1.0 million for the three months ended
September 30, 2022. The deferred costs of drydockings for
a given vessel are amortized on a straight-line basis to the next
scheduled drydocking of the vessel.
General and Administrative Expenses: Corporate.
Corporate-related general and administrative expenses for the three
months ended September 30, 2023 were $5.1 million, a decrease of $0.7 million from $5.8
million for the three months ended
September 30, 2022. The decrease in costs was driven by
non-recurring items, including refinancing-related fees of
$0.4 million, incurred during the
three months ended September 30, 2022, which did not
occur during the three months ended
September 30, 2023.
General and Administrative Expenses: Commercial and
Chartering. Commercial and chartering expenses are the
expenses attributable to Ardmore's chartering and commercial
operations departments in connection with its spot trading
activities. Commercial and chartering expenses for the three months
ended September 30, 2023 were $1.1
million, an increase of $0.2
million from $0.9 million for
the three months ended September 30, 2022.
Unrealized Gains / (Losses) on Derivatives: We had
no unrealized gains or losses on derivatives for the three months
ended September 30, 2023, as compared to an unrealized
gain of $3.4 million for the three
months ended September 30, 2022. The interest rate swap
agreements expired in July 2023.
Interest Expense and Finance Costs. Interest
expense and finance costs for the three months ended September 30, 2023 were $3.0 million, a decrease of $1.5 million from $4.5
million for the three months ended September 30, 2022. The decrease in costs was
primarily due to lower aggregate outstanding obligations following
the refinancing of 19 vessels completed during the second half of
2022. Amortization of deferred finance fees for the three months
ended September 30, 2023 was
$0.3 million, with a slight decrease
from $0.4 million for the three
months ended September 30, 2022.
Liquidity
As of September 30, 2023, the Company had $273.7 million in liquidity available, with cash
and cash equivalents of $50.8 million
(December 31, 2022: $50.6
million) and amounts available and undrawn under its
revolving credit facilities of $222.9
million (December 31, 2022:
$170.0 million). The following debt
and lease liabilities (net of deferred finance fees) were
outstanding as of the dates indicated:
|
|
|
|
|
|
|
|
|
As of
|
In thousands of U.S.
Dollars
|
|
September 30, 2023
|
|
December 31, 2022
|
Cash and cash
equivalents
|
|
$
|
50,760
|
|
$
|
50,569
|
|
|
|
|
|
|
|
Finance
leases
|
|
|
44,127
|
|
|
45,500
|
Senior Debt
|
|
|
46,696
|
|
|
103,112
|
Revolving Credit
Facilities
|
|
|
5,781
|
|
|
25,684
|
Total
debt
|
|
|
96,604
|
|
|
174,296
|
|
|
|
|
|
|
|
Total net
debt
|
|
$
|
45,844
|
|
$
|
123,727
|
Conference Call
The Company plans to host a conference call on November 7, 2023, at 10:00 a.m. Eastern Time
to discuss its results for the quarter ended
September 30, 2023. All interested parties are invited to
listen to the live conference call and review the related slide
presentation by choosing from the following options:
- By dialing 844–492–3728 (U.S.) or 412–542–4189 (International)
and referencing "Ardmore Shipping."
- By accessing the live webcast at Ardmore's website at
www.ardmoreshipping.com.
Participants should dial into the call 10 minutes before the
scheduled time.
If you are unable to participate at this time, an audio replay
of the call will be available through November 14, 2023 at 877–344–7529 or
412–317–0088. Enter the passcode 8627746 to access the audio
replay. A recording of the webcast, with associated slides, will
also be available on the Company's website. The information
provided on the teleconference is only accurate at the time of the
conference call, and the Company takes no responsibility for
providing updated information.
About Ardmore Shipping Corporation
Ardmore owns and operates a fleet of MR product and chemical
tankers ranging from 25,000 to 50,000 deadweight tonnes. Ardmore
provides, through its modern, fuel-efficient fleet of mid-size
tankers, seaborne transportation of petroleum products and
chemicals worldwide to oil majors, national oil companies, oil and
chemical traders, and chemical companies.
Ardmore's core strategy is to continue to develop a modern,
high-quality fleet of product and chemical tankers, build key
long-term commercial relationships and maintain its cost advantage
in assets, operations and overhead, while creating synergies and
economies of scale as the company grows. Ardmore provides its
services to customers through voyage charters and time charters,
and enjoys close working relationships with key commercial and
technical management partners.
Ardmore's Energy Transition Plan ("ETP") focusses on three key
areas: transition technologies, transition projects, and
sustainable (non-fossil fuel) cargos. The ETP is an extension of
Ardmore's strategy, building on its core strengths of tanker
chartering, shipping operations, technical and operational fuel
efficiency improvements, technical management, construction
supervision, project management, investment analysis, and ship
finance.
Ardmore Shipping
Corporation
Unaudited Condensed
Consolidated Balance Sheets
|
|
|
|
As of
|
In thousands of U.S.
Dollars, except as indicated
|
|
September 30, 2023
|
|
December 31, 2022
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
50,760
|
|
50,569
|
Receivables, net of
allowance for bad debts of $1.5 million (2022: $2.2
million)
|
|
50,793
|
|
79,843
|
Prepaid expenses and
other assets
|
|
5,062
|
|
4,521
|
Advances and
deposits
|
|
1,802
|
|
2,160
|
Inventories
|
|
14,895
|
|
15,718
|
Current portion of
derivative assets
|
|
—
|
|
4,927
|
Total current
assets
|
|
123,312
|
|
157,738
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Investments and other
assets, net
|
|
11,574
|
|
11,219
|
Vessels and vessel
equipment, net
|
|
522,655
|
|
531,378
|
Deferred drydock
expenditures, net
|
|
8,290
|
|
4,716
|
Advances for ballast
water treatment and scrubber systems
|
|
11,195
|
|
5,530
|
Deferred finance fees,
net
|
|
3,054
|
|
2,717
|
Operating lease,
right-of-use asset
|
|
6,320
|
|
10,561
|
Total non-current
assets
|
|
563,088
|
|
566,121
|
|
|
|
|
|
TOTAL
ASSETS
|
|
686,400
|
|
723,859
|
|
|
|
|
|
LIABILITIES,
REDEEMABLE PREFERRED STOCK AND EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
|
7,258
|
|
8,814
|
Accrued expenses and
other liabilities
|
|
19,175
|
|
20,890
|
Deferred
revenue
|
|
1,611
|
|
1,220
|
Accrued interest on
debt and finance leases
|
|
562
|
|
863
|
Current portion of
long-term debt
|
|
6,434
|
|
12,927
|
Current portion of
finance lease obligations
|
|
1,986
|
|
1,857
|
Current portion of
operating lease obligations
|
|
5,554
|
|
6,358
|
Total current
liabilities
|
|
42,580
|
|
52,929
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
Non-current portion of
long-term debt
|
|
46,043
|
|
115,869
|
Non-current portion of
finance lease obligations
|
|
42,141
|
|
43,643
|
Non-current portion of
operating lease obligations
|
|
544
|
|
3,969
|
Other non-current
liabilities
|
|
1,007
|
|
1,007
|
Total non-current
liabilities
|
|
89,735
|
|
164,488
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
132,315
|
|
217,417
|
|
|
|
|
|
Redeemable Preferred
Stock
|
|
|
|
|
Cumulative Series A
8.5% redeemable preferred stock
|
|
37,043
|
|
37,043
|
Total redeemable
preferred stock
|
|
37,043
|
|
37,043
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
Common stock
|
|
433
|
|
426
|
Additional paid in
capital
|
|
470,400
|
|
468,006
|
Accumulated other
comprehensive income
|
|
—
|
|
1,468
|
Treasury
stock
|
|
(15,636)
|
|
(15,636)
|
Retained
earnings
|
|
61,845
|
|
15,135
|
Total stockholders'
equity
|
|
517,042
|
|
469,399
|
|
|
|
|
|
Total redeemable
preferred stock and stockholders' equity
|
|
554,085
|
|
506,442
|
|
|
|
|
|
TOTAL LIABILITIES,
REDEEMABLE PREFERRED STOCK AND EQUITY
|
|
686,400
|
|
723,859
|
Ardmore Shipping
Corporation
Unaudited Condensed
Consolidated Statements of Operations
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
In thousands of U.S.
Dollars except per
share and share data
|
|
September 30, 2023
|
|
September 30, 2022
|
|
September 30, 2023
|
|
September 30, 2022
|
Revenue, net
|
|
86,940
|
|
142,417
|
|
297,099
|
|
312,910
|
|
|
|
|
|
|
|
|
|
Voyage
expenses
|
|
(30,640)
|
|
(45,970)
|
|
(98,735)
|
|
(114,223)
|
Vessel operating
expenses
|
|
(14,427)
|
|
(13,316)
|
|
(44,622)
|
|
(45,846)
|
Time
charter-in
|
|
|
|
|
|
|
|
|
Operating expense
component
|
|
(2,115)
|
|
(2,320)
|
|
(7,229)
|
|
(4,664)
|
Vessel lease expense
component
|
|
(1,946)
|
|
(2,135)
|
|
(6,652)
|
|
(4,291)
|
Depreciation
|
|
(6,928)
|
|
(7,253)
|
|
(20,683)
|
|
(22,025)
|
Amortization of
deferred drydock
expenditures
|
|
(733)
|
|
(1,006)
|
|
(2,635)
|
|
(3,162)
|
General and
administrative expenses
|
|
|
|
|
|
|
|
|
Corporate
|
|
(5,081)
|
|
(5,830)
|
|
(14,902)
|
|
(14,588)
|
Commercial and
chartering
|
|
(1,087)
|
|
(919)
|
|
(3,310)
|
|
(2,863)
|
Unrealized gains /
(losses) on derivatives
|
|
—
|
|
3,364
|
|
(31)
|
|
4,264
|
Interest expense and
finance costs
|
|
(2,998)
|
|
(4,548)
|
|
(8,687)
|
|
(13,502)
|
Loss on
extinguishment
|
|
—
|
|
(611)
|
|
—
|
|
(688)
|
Interest
income
|
|
418
|
|
191
|
|
1,263
|
|
221
|
Loss on vessels
sold
|
|
—
|
|
—
|
|
—
|
|
(6,917)
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
21,403
|
|
62,064
|
|
90,876
|
|
84,626
|
|
|
|
|
|
|
|
|
|
Income tax
|
|
(50)
|
|
(27)
|
|
(347)
|
|
(72)
|
(Loss) / profit from
equity method
investments
|
|
(150)
|
|
(205)
|
|
(730)
|
|
(36)
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
21,203
|
|
61,832
|
|
89,799
|
|
84,518
|
|
|
|
|
|
|
|
|
|
Preferred
dividend
|
|
(857)
|
|
(857)
|
|
(2,543)
|
|
(2,543)
|
|
|
|
|
|
|
|
|
|
Net Income
attributable to common
stockholders
|
|
20,346
|
|
60,975
|
|
87,256
|
|
81,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share,
basic
|
|
0.49
|
|
1.57
|
|
2.12
|
|
2.27
|
Earnings per share,
diluted
|
|
0.49
|
|
1.52
|
|
2.09
|
|
2.22
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
(1)
|
|
20,346
|
|
61,585
|
|
87,256
|
|
89,581
|
Adjusted earnings per
share, basic
|
|
0.49
|
|
1.59
|
|
2.12
|
|
2.48
|
Adjusted earnings per
share, diluted
|
|
0.49
|
|
1.54
|
|
2.09
|
|
2.43
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares
outstanding, basic
|
|
41,296,128
|
|
38,766,186
|
|
41,072,686
|
|
36,104,796
|
Weighted average number
of shares
outstanding, diluted
|
|
41,754,259
|
|
40,115,511
|
|
41,742,364
|
|
36,930,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Adjusted earnings /
(loss) is a non-GAAP measure and is defined and reconciled under
the "Non-GAAP Measures" section.
|
Ardmore Shipping
Corporation
Unaudited Condensed
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
Nine Months
Ended
|
In thousands of U.S.
Dollars
|
|
September 30, 2023
|
|
September 30, 2022
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net income
|
|
89,799
|
|
84,518
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation
|
|
20,683
|
|
22,025
|
Amortization of
deferred drydock expenditures
|
|
2,635
|
|
3,162
|
Share-based
compensation
|
|
2,401
|
|
2,354
|
Loss on vessels
sold
|
|
—
|
|
6,917
|
Amortization of
deferred finance fees
|
|
913
|
|
1,815
|
Unrealized losses /
(gains) on derivatives
|
|
31
|
|
(4,264)
|
Operating lease ROU -
lease liability, net
|
|
12
|
|
(73)
|
Loss from equity method
investments
|
|
730
|
|
36
|
Deferred drydock
payments
|
|
(5,654)
|
|
(1,231)
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Receivables
|
|
29,052
|
|
(45,187)
|
Prepaid expenses and
other assets
|
|
(541)
|
|
(810)
|
Advances and
deposits
|
|
357
|
|
1,088
|
Inventories
|
|
823
|
|
(8,083)
|
Accounts
payable
|
|
(153)
|
|
(1,144)
|
Accrued expenses and
other liabilities
|
|
(313)
|
|
3,224
|
Deferred
revenue
|
|
391
|
|
(1,363)
|
Accrued
interest
|
|
(300)
|
|
482
|
Net cash provided by
operating activities
|
|
140,866
|
|
63,466
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
Proceeds from sale of
vessels
|
|
—
|
|
39,912
|
Payments for
acquisition of vessels and vessel equipment
|
|
(12,079)
|
|
(1,149)
|
Advances for ballast
water treatment and scrubber systems
|
|
(5,353)
|
|
(645)
|
Payments for other
non-current assets
|
|
(69)
|
|
(96)
|
Payments for equity
investments
|
|
(1,142)
|
|
(363)
|
Net cash (used in) /
provided by investing activities
|
|
(18,643)
|
|
37,659
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
Prepayment of finance
lease obligation
|
|
—
|
|
(84,724)
|
Proceeds from long-term
debt
|
|
—
|
|
96,019
|
Repayments of long-term
debt
|
|
(77,480)
|
|
(138,093)
|
Repayments of finance
leases
|
|
(1,463)
|
|
(12,298)
|
Payments for deferred
finance fees
|
|
—
|
|
(3,405)
|
Payment of common share
dividend
|
|
(40,546)
|
|
—
|
Issuance of common
stock, net
|
|
—
|
|
38,977
|
Payment of preferred
share dividend
|
|
(2,543)
|
|
(2,428)
|
Net cash (used in)
financing activities
|
|
(122,032)
|
|
(105,952)
|
|
|
|
|
|
Net increase /
(decrease) in cash and cash equivalents
|
|
191
|
|
(4,827)
|
|
|
|
|
|
Cash and cash
equivalents at the beginning of the year
|
|
50,569
|
|
55,449
|
|
|
|
|
|
Cash and cash
equivalents at the end of the period
|
|
50,760
|
|
50,622
|
Ardmore Shipping
Corporation
Unaudited Other
Operating Data
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30, 2023
|
|
September 30, 2022
|
|
September 30, 2023
|
|
September 30, 2022
|
In thousands of U.S.
Dollars except
Fleet Data
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
|
31,644
|
|
71,927
|
|
121,649
|
|
126,435
|
Adjusted EBITDAR
(1)
|
|
33,590
|
|
74,062
|
|
128,301
|
|
130,726
|
|
|
|
|
|
|
|
|
|
AVERAGE DAILY
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MR Tankers Spot TCE per
day (2)
|
|
28,493
|
|
44,228
|
|
30,664
|
|
30,758
|
|
|
|
|
|
|
|
|
|
Fleet TCE per day
(2)
|
|
26,347
|
|
40,308
|
|
29,114
|
|
27,895
|
|
|
|
|
|
|
|
|
|
Fleet operating
expenses per day (3)
|
|
6,439
|
|
6,009
|
|
6,609
|
|
6,334
|
Technical management
fees per day (4)
|
|
445
|
|
375
|
|
480
|
|
458
|
|
|
6,884
|
|
6,384
|
|
7,089
|
|
6,792
|
|
|
|
|
|
|
|
|
|
MR Eco-Design
Tankers
|
|
|
|
|
|
|
|
|
TCE per day
(2)
|
|
25,932
|
|
44,897
|
|
30,503
|
|
30,589
|
Vessel operating
expenses per day (5)
|
|
6,904
|
|
6,434
|
|
7,187
|
|
6,776
|
|
|
|
|
|
|
|
|
|
MR Eco-Mod
Tankers
|
|
|
|
|
|
|
|
|
TCE per day
(2)
|
|
36,362
|
|
37,607
|
|
31,144
|
|
27,203
|
Vessel operating
expenses per day (5)
|
|
6,936
|
|
5,558
|
|
6,943
|
|
6,578
|
|
|
|
|
|
|
|
|
|
Prod/Chem Eco-Design
Tankers (25k
- 38k dwt)
|
|
|
|
|
|
|
|
|
TCE per day
(2)
|
|
20,023
|
|
31,536
|
|
24,198
|
|
21,894
|
Vessel operating
expenses per day (5)
|
|
6,827
|
|
6,634
|
|
6,870
|
|
6,939
|
|
|
|
|
|
|
|
|
|
FLEET
|
|
|
|
|
|
|
|
|
Average number of
operating vessels
|
|
26.0
|
|
27.0
|
|
26.2
|
|
27.0
|
|
|
|
|
|
|
(1)
|
Adjusted EBITDA and
Adjusted EBITDAR are non-GAAP measures and are defined and
reconciled to the most directly comparable U.S. GAAP measure under
the section of this release entitled "Non-GAAP
Measures."
|
(2)
|
Time Charter Equivalent
("TCE") rate, a non-GAAP measure, represents net revenues (a
non-GAAP measure representing revenues less voyage expenses)
divided by revenue days. Revenue days are the total
number of calendar days the vessels are in the Company's
possession less off-hire days generally associated with
drydocking or repairs and idle days associated with
repositioning of vessels held for sale. Net revenue utilized to
calculate the TCE rate is determined on a discharge to discharge
basis, which is different from how the Company records revenue
under U.S. GAAP. Under discharge to discharge, revenues are
recognized beginning from the discharge of cargo from the prior
voyage to the anticipated discharge of cargo in the current voyage,
and voyage expenses are recognized as incurred.
|
(3)
|
Fleet operating
expenses per day are routine operating expenses and comprise
crewing, repairs and maintenance, insurance, stores, lube oils and
communication expenses. These amounts do not include expenditures
related to vessel upgrades and enhancements or other non-routine
expenditures which were expensed during the period.
|
(4)
|
Technical management
fees are fees paid to third-party technical managers.
|
(5)
|
Vessel operating
expenses per day include technical management fees.
|
Ardmore Shipping
Corporation
Fleet Details at
September 30, 2023
(Expressed in
Millions of U.S. Dollars, other than per share
amount)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated Resale
|
|
Estimated
|
|
|
|
|
|
|
|
|
|
|
|
|
Newbuilding
|
|
Depreciated
|
|
|
|
|
|
|
|
|
|
|
Eco
|
|
Price (1)
|
|
Replacement
|
Vessel
|
|
IMO
|
|
Built
|
|
Country
|
|
Dwt
|
|
Specification
|
|
September 30, 2023
|
|
Value
(2)
|
Seahawk
|
|
IMO2/3
|
|
Nov-15
|
|
S. Korea
|
|
49,999
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
35.53
|
Seawolf
|
|
IMO2/3
|
|
Aug-15
|
|
S. Korea
|
|
49,999
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
35.13
|
Seafox
|
|
IMO2/3
|
|
Jun-15
|
|
S. Korea
|
|
49,999
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
34.89
|
Sealion
|
|
IMO2/3
|
|
May-15
|
|
S. Korea
|
|
49,999
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
34.74
|
Engineer
|
|
IMO2/3
|
|
Mar-14
|
|
S. Korea
|
|
49,420
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.58
|
Seavanguard
|
|
IMO2/3
|
|
Feb-14
|
|
S. Korea
|
|
49,998
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.39
|
Exporter
|
|
IMO2/3
|
|
Feb-14
|
|
S. Korea
|
|
49,466
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.44
|
Seavantage
|
|
IMO2/3
|
|
Jan-14
|
|
S. Korea
|
|
49,997
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.26
|
Encounter
|
|
IMO2/3
|
|
Jan-14
|
|
S. Korea
|
|
49,478
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.15
|
Explorer
|
|
IMO2/3
|
|
Jan-14
|
|
S. Korea
|
|
49,494
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.30
|
Endurance
|
|
IMO2/3
|
|
Dec-13
|
|
S. Korea
|
|
49,466
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
32.09
|
Enterprise
|
|
IMO2/3
|
|
Sep-13
|
|
S. Korea
|
|
49,453
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
31.66
|
Endeavour
|
|
IMO2/3
|
|
Jul-13
|
|
S. Korea
|
|
49,997
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
31.36
|
Seaventure
|
|
IMO2/3
|
|
Jun-13
|
|
S. Korea
|
|
49,998
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
31.14
|
Seavaliant
|
|
IMO2/3
|
|
Feb-13
|
|
S. Korea
|
|
49,998
|
|
Eco-Design
|
|
$
|
50.00
|
|
$
|
30.63
|
Seafarer
|
|
-
|
|
Jun-10
|
|
Japan
|
|
49,999
|
|
Eco-Mod
|
|
$
|
50.00
|
|
$
|
25.32
|
Defender
|
|
IMO2
|
|
Feb-15
|
|
S. Korea
|
|
37,791
|
|
Eco-Design
|
|
$
|
44.00
|
|
$
|
30.10
|
Dauntless
|
|
IMO2
|
|
Feb-15
|
|
S. Korea
|
|
37,764
|
|
Eco-Design
|
|
$
|
44.00
|
|
$
|
30.05
|
Chippewa
|
|
IMO2
|
|
Nov-15
|
|
Japan
|
|
25,217
|
|
Eco-Design
|
|
$
|
37.50
|
|
$
|
26.44
|
Chinook
|
|
IMO2
|
|
Jul-15
|
|
Japan
|
|
25,217
|
|
Eco-Design
|
|
$
|
37.50
|
|
$
|
26.03
|
Cheyenne
|
|
IMO2
|
|
Mar-15
|
|
Japan
|
|
25,217
|
|
Eco-Design
|
|
$
|
37.50
|
|
$
|
25.60
|
Cherokee
|
|
IMO2
|
|
Jan-15
|
|
Japan
|
|
25,215
|
|
Eco-Design
|
|
$
|
37.50
|
|
$
|
25.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
680.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash / Debt / Work. Cap
/ Other Assets
|
|
$
|
(3.09)
|
|
|
|
|
|
|
|
|
Total Asset Value
(Assets) (3)
|
|
$
|
677.02
|
|
|
|
|
|
|
|
|
DRV / Share
(3)(4)
|
|
$
|
16.39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ardmore Commercial
Management (5)
|
|
$
|
19.50
|
|
|
|
|
|
|
|
|
Total Asset Value
(Assets & Commercial Management) (3)
|
|
$
|
696.52
|
|
|
|
|
|
|
|
|
DRV / Share
(3)(4)
|
|
$
|
16.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment in Element 1
Corp. / e1 Marine (6)
|
|
$
|
11.20
|
|
|
|
|
|
|
|
|
Total Asset Value
(Assets, Commercial Management &
Investments) (3)
|
|
$
|
707.73
|
|
|
|
|
|
|
|
|
DRV / Share
(3)(4)(6)
|
|
|
|
|
|
|
$
|
17.14
|
|
|
|
|
|
|
1.
|
Based on the average of
two broker estimates of prompt resale for a newbuild vessel of
equivalent deadweight tonne at a yard in South Korea as at June 30,
2023.
|
2.
|
Depreciated Replacement
Value ("DRV") is based on estimated resale price for a newbuild
vessel depreciated for the age of each vessel (assuming an
estimated useful life of 25 years on a straight-line basis and
assuming a residual scrap value of $400 per tonne which is in line
with Ardmore's depreciation policy). The Company's estimates of DRV
assume that its vessels are all in good and seaworthy condition
without the need for repair and, if inspected, that they would be
certified in class without notations of any kind. Vessel values are
highly volatile and, as such, the Company's estimates of DRV may
not be indicative of the current or future value of its vessels, or
prices that the Company could achieve if it were to sell
them.
|
3.
|
Depreciated Replacement
Value ("DRV") and DRV per share are non-GAAP measures. Management
believes that many investors use DRV as a reference point in
assessing valuation of fleets of ships and similar
assets.
|
4.
|
DRV / Share calculated
using 41,298,849 shares outstanding as of
September 30, 2023.
|
5.
|
Ardmore Commercial
Management is management's estimate of the value of Ardmore's
commercial management and pooling business. The estimate is based
on industry standard commercial management and pooling fees in
determining revenue less Ardmore's commercial and chartering
overhead (as stated in Ardmore's Statement of Operations) and
applying an illustrative multiple to the resulting net earnings of
7x. The multiple is illustrative only and may not be indicative of
the valuation multiple the Company could achieve if it were to sell
its commercial management and pooling business. Revenue of this
business is comprised of (i) commission (1.25% for standard product
tankers and 2.5% for chemical tankers) on gross freight based on
estimated current TCE rates grossed up for voyage expenses and (ii)
administration fee of $300 per vessel per day. These rates may vary
over time.
|
6.
|
Valuation of investment
in E1 Corp. and e1 Marine (a joint venture with E1 Corp and
Maritime Partners, LLC, of which ASC owns 33%) are at
cost.
|
CO2 Emissions Reporting(1)
In April 2018, the International Maritime Organization's
("IMO") Marine Environment Protection Committee ("MEPC") adopted an
initial strategy for the reduction of greenhouse gas ("GHG")
emissions from ships, setting out a vision to reduce GHG emissions
from international shipping and phase them out as soon as possible.
Ardmore is committed to transparency and contributing to the
reduction of CO2 emissions in the Company's industry.
Ardmore's reporting methodology is in line with the framework set
out within the IMO's Data Collection System ("DCS") initiated in
2019.
On January 1, 2023 the BIMCO CII
Operations Clause for Time Charter Parties came into force. This
clause outlines that the charterer should take responsibility for a
ship's emissions. On this basis, Ardmore's GHG emissions analysis
has been updated to exclude the impact of ships time-chartered out
and to include the impact of ships time-chartered in. Previously
all vessels were included in Ardmore's analysis from the fleet
except for vessels commercially managed by Ardmore.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve months
ended
|
|
|
|
September 30, 2023
|
|
September 30, 2022
|
|
September 30, 2023
|
|
September 30, 2022
|
|
|
|
|
|
|
|
|
|
|
|
Number of Vessels in
Operation (at period end)(2)
|
|
26
|
|
27
|
|
26
|
|
27
|
|
Fleet Average
Age
|
|
10.2
|
|
9.3
|
|
10.2
|
|
9.3
|
|
|
|
|
|
|
|
|
|
|
|
CO2 Emissions Generated
in Metric Tonnes
|
|
106,724
|
|
102,523
|
|
420,298
|
|
375,263
|
|
Distance Travelled
(Nautical Miles)
|
|
411,092
|
|
374,038
|
|
1,538,072
|
|
1,411,809
|
|
Fuel Consumed in Metric
Tonnes
|
|
33,780
|
|
32,477
|
|
133,010
|
|
118,785
|
|
|
|
|
|
|
|
|
|
|
|
Cargo Heating and
Tank Cleaning Emissions
|
|
|
|
|
|
|
|
|
|
Fuel Consumed in Metric
Tonnes
|
|
255
|
|
774
|
|
1,771
|
|
3,659
|
|
% of Total Fuel
Consumed
|
|
0.75 %
|
|
2.38 %
|
|
1.33 %
|
|
3.08 %
|
|
|
|
|
|
|
|
|
|
|
|
Annual Efficiency
Ratio (AER) for the period(3)
|
|
|
|
|
|
|
|
|
|
Fleet
|
|
5.80g / tm
|
|
6.14g / tm
|
|
6.10g / tm
|
|
5.93g / tm
|
|
MR
Eco-Design
|
|
5.54g / tm
|
|
5.70g / tm
|
|
5.69g / tm
|
|
5.67g / tm
|
|
MR Eco-Mod
|
|
5.80g / tm
|
|
6.43g / tm
|
|
6.22g / tm
|
|
5.95g / tm
|
|
Chemical
|
|
7.16g / tm
|
|
7.77g / tm
|
|
7.76g / tm
|
|
7.49g / tm
|
|
Chemical (Less Cargo
Heating & Tank Cleaning)(4)
|
|
7.00g / tm
|
|
7.41g / tm
|
|
7.32g / tm
|
|
6.91g / tm
|
|
|
|
|
|
|
|
|
|
|
|
Energy Efficiency
Operational Indicator (EEOI)
for the period
|
|
|
|
|
|
|
|
|
|
Fleet
|
|
12.21g / ctm
|
|
13.06g / ctm
|
|
13.37g / ctm
|
|
12.16g / ctm
|
|
MR
Eco-Design
|
|
12.44g / ctm
|
|
12.61g / ctm
|
|
13.27g / ctm
|
|
11.93g / ctm
|
|
MR Eco-Mod
|
|
10.96g / ctm
|
|
14.63g / ctm
|
|
13.04g / ctm
|
|
12.17g / ctm
|
|
Chemical
|
|
12.86g / ctm
|
|
12.92g / ctm
|
|
14.12g / ctm
|
|
12.73g / ctm
|
|
Chemical (Less Cargo
Heating & Tank Cleaning)(3)
|
|
12.58g / ctm
|
|
12.32g / ctm
|
|
13.33g / ctm
|
|
11.74g / ctm
|
|
|
|
|
|
|
|
|
|
|
|
Wind Strength (%
greater than 4 on BF)
|
|
47.89 %
|
|
47.32 %
|
|
49.09 %
|
|
46.91 %
|
|
% Idle Time
|
|
3.79 %
|
|
2.10 %
|
|
3.96 %
|
|
3.01 %
|
|
|
|
|
|
|
|
|
|
|
|
tm =
tonne-mile
|
|
|
|
|
|
|
|
|
|
ctm = cargo
tonne-mile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ardmore Performance
It should be noted that results vary quarter to quarter
depending on ship activity, ballast / laden ratio, cargo carried,
weather, waiting time, time in port and vessel speed. However,
analysis is also presented on a trailing 12-month basis to provide
a more accurate assessment of Ardmore's progress over a longer
period and to mitigate seasonality. From a weather perspective
rougher weather (based on Beaufort
Scale wind force rating being greater than 4 BF) will
generally have a mitigating impact on the ability to optimize fuel
consumption while idle time will impact ships metrics as they will
still require power to run but will not be moving. Overall Ardmore
Shipping's carbon emissions for the trailing 12-month period
increased from 375,263 metric tonnes to 420,298 metric tonnes of
CO2, primarily due to increased distances travelled and heightened
vessel speeds. Fleet EEOI for the period increased from 12.16 g /
ctm to 13.37 g / ctm, primarily due to higher repositioning days on
account of drydocks and heightened vessel speeds while AER
increased from 5.93 g / tm to 6.10 g / tm, primarily due to
heightened vessel speeds. Ardmore seeks to achieve improvements
through a combination of technological advancements and operational
optimization.
|
|
|
|
1 Ardmore's emissions data is based
on the reporting tools and information reasonably available to
Ardmore and its applicable third-party technical managers for
Ardmore's owned fleet. Management assesses such data and may adjust
and restate the data to reflect latest information. It is expected
that the shipping industry will continue to refine the performance
measures for emissions and efficiency over time. AER and EEOI
metrics are impacted by external factors such as charter speed,
vessel orders and weather, in conjunction with overall market
factors such as cargo load sizes and fleet utilization rate. As
such, variance in performance can be found in the reported
emissions between two periods for the same vessel and between
vessels of a similar size and type. Furthermore, other companies
may report slight variations (e.g. some shipping companies report
CO2 in tonnes per kilometer as opposed to CO2
in tonnes per nautical mile) and consequently it is not always
practical to directly compare emissions from different companies.
The figures reported above represent Ardmore's initial findings;
the Company is committed to improving the methodology and
transparency of its emissions reporting in line with industry best
practices. Accordingly, the above results may vary as the
methodology and performance measures set out by the industry
evolve.
|
2 Includes time-chartered out and
time-chartered in vessels.
|
3 Annual Efficiency Ratio ("AER") is a
measure of carbon efficiency using the parameters of fuel
consumption, distance travelled, and design deadweight tonnage
("DWT"). AER is reported in unit grams of CO2 per
ton-mile (gCO2/dwt-nm). It is calculated by dividing (i)
mass of fuel consumed by type converted to metric tonnes of
CO2 by (ii) DWT multiplied by distance travelled in
nautical miles. A lower AER reflects better carbon
efficiency.
|
4 The
AER and EEOI figures are presented including the impact of cargo
heating and tank cleaning operations unless stated.
|
5 Energy Efficiency Operational
Indicator ("EEOI") is a tool for measuring CO2 gas
emissions in a given time period per unit of transport work
performed. It is calculated by dividing (i) mass of fuel consumed
by type converted to metric tonnes of CO2 by (ii) cargo
carried in tonnes multiplied by laden voyage distance in nautical
miles. This calculation is performed as per IMO MEPC.1/Circ684. A
lower EEOI reflects lower CO2 gas emissions in a given time period
per unit of transport work performed.
|
6 Idle time
is the amount of time a vessel is waiting in port or awaiting the
laycan or waiting in port/at sea unfixed.
|
Non-GAAP Measures
EBITDA + vessel lease expense component (i.e.
EBITDAR)
EBITDAR is defined as EBITDA (i.e. earnings before
interest, loss on extinguishment, unrealized gains/(losses) on
interest rate derivatives, profit/(loss) on equity method
investments, taxes, depreciation and amortization) plus the vessel
lease expense component of total charter hire expense for
chartered-in vessels. Adjusted EBITDAR is defined as EBITDAR before
certain items that Ardmore believes are not representative of its
operating performance, including gain or loss on sale of
vessels.
For the three months ended September 30, 2023, we
recognized total charter hire expense of $4.1 million in respect of time charter-in
vessels under operating leases. The total expense includes (i)
$2.0 million in respect of the right
to use the leased assets (i.e. vessel lease expense component), and
(ii) $2.1 million in respect of the
costs of operating the vessels (i.e. operating expense component).
Under US GAAP, the expense related to the right to use the leased
assets (i.e. capital component) is treated as an operating item on
our consolidated statement of operations, and is not added back in
our calculation of EBITDA. The treatment of operating lease
expenses differs under US GAAP as compared to international
financial reporting standards ("IFRS"). Under IFRS, the expense of
an operating lease is presented in depreciation and interest
expense.
Many companies in our industry report under IFRS; we therefore
use EBITDAR and Adjusted EBITDAR as tools to compare our valuation
with the valuation of these other companies in our industry. We do
not use EBITDAR and Adjusted EBITDAR as measures of performance or
liquidity. We present below reconciliations of net income /
(loss) attributable to common stockholders to EBITDAR (which
includes an adjustment for vessel lease operating expenses) and
Adjusted EBITDAR.
EBITDAR and Adjusted EBITDAR, as presented, may not be directly
comparable to similarly titled measures presented by other
companies. In addition, EBITDAR and Adjusted EBITDAR should not be
viewed as measures of overall performance since they exclude vessel
rent, which is a normal, recurring cash operating expense related
to our in-chartering of vessels that is necessary to operate our
business. Accordingly, you are cautioned not to place undue
reliance on this information.
EBITDA, Adjusted EBITDA, Adjusted Earnings and Adjusted
Earnings (for purposes of dividend calculations)
EBITDA, Adjusted EBITDA and Adjusted earnings are not measures
prepared in accordance with U.S. GAAP and are defined and
reconciled below. EBITDA is defined as earnings before interest,
loss on extinguishment, unrealized gains/(losses) on interest rate
derivatives, profit/(loss) on equity method investments, taxes,
depreciation and amortization. Adjusted EBITDA is defined as EBITDA
before certain items that Ardmore believes are not representative
of its operating performance, including gain or loss on sale of
vessels. Adjusted earnings excludes certain items from net income
attributable to common stockholders, including gain or loss on sale
of vessels and write-off of deferred finance fees (i.e., loss on
extinguishment) because they are considered to not be
representative of the Company's operating performance.
EBITDA, Adjusted EBITDA and Adjusted earnings are presented in
this press release as the Company believes that they provide
investors with a means of evaluating and understanding how
Ardmore's management evaluates operating performance. EBITDA and
Adjusted EBITDA increase the comparability of the Company's
fundamental performance from period to period. This increased
comparability is achieved by excluding the potentially disparate
effects between periods of interest expense, taxes, depreciation or
amortization, which items are affected by various and possibly
changing financing methods, capital structure and historical cost
basis and which items may significantly affect net income between
periods. The Company believes that including EBITDA, Adjusted
EBITDA and Adjusted earnings as financial and operating measures
assists investors in making investment decisions regarding the
Company and its common stock.
For purposes solely of the quarterly common dividend
calculation, Adjusted Earnings represents the Company's Adjusted
earnings for the quarter ended September 30, 2023, but
excluding the impact of unrealized gains / (losses) and certain
non-recurring items.
These non-GAAP measures should not be considered in isolation
from, as substitutes for, or superior to, financial measures
prepared in accordance with U.S. GAAP. In addition, these non-GAAP
measures may not have a standardized meaning and therefore may not
be comparable to similar measures presented by other companies.
|
|
|
|
|
|
|
|
|
Reconciliation of
net income to EBITDA, Adjusted EBITDA and Adjusted
EBITDAR
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30, 2023
|
|
September 30, 2022
|
|
September 30, 2023
|
|
September 30, 2022
|
In thousands of U.S.
Dollars
|
|
|
|
|
|
|
|
|
Net income
|
|
21,203
|
|
61,832
|
|
89,799
|
|
84,518
|
Interest
income
|
|
(418)
|
|
(191)
|
|
(1,263)
|
|
(221)
|
Interest expense and
finance costs
|
|
2,998
|
|
4,548
|
|
8,687
|
|
13,502
|
Loss on
extinguishment
|
|
—
|
|
611
|
|
—
|
|
688
|
Income tax
|
|
50
|
|
27
|
|
347
|
|
71
|
Unrealized (gains) /
losses on derivatives
|
|
—
|
|
(3,364)
|
|
31
|
|
(4,264)
|
Depreciation
|
|
6,928
|
|
7,253
|
|
20,683
|
|
22,025
|
Amortization of
deferred drydock
expenditures
|
|
733
|
|
1,006
|
|
2,635
|
|
3,162
|
Loss from equity method
investments
|
|
150
|
|
205
|
|
730
|
|
36
|
EBITDA
|
|
31,644
|
|
71,927
|
|
121,649
|
|
119,517
|
Loss on vessels
sold
|
|
—
|
|
—
|
|
—
|
|
6,917
|
ADJUSTED
EBITDA
|
|
31,644
|
|
71,927
|
|
121,649
|
|
126,434
|
Plus: Vessel lease
expense component
|
|
1,946
|
|
2,135
|
|
6,652
|
|
4,291
|
ADJUSTED
EBITDAR
|
|
33,590
|
|
74,062
|
|
128,301
|
|
130,725
|
|
|
|
|
|
|
|
|
|
Reconciliation of
net income attributable to common stockholders to Adjusted
earnings
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30, 2023
|
|
September 30, 2022
|
|
September 30, 2023
|
|
September 30, 2022
|
In thousands of U.S.
Dollars except per share data
|
|
|
|
|
|
|
|
|
Net income attributable
to common stockholders
|
|
20,346
|
|
60,975
|
|
87,256
|
|
81,976
|
Loss on vessels
sold
|
|
—
|
|
—
|
|
—
|
|
6,917
|
Loss on
extinguishment
|
|
—
|
|
610
|
|
—
|
|
688
|
Adjusted
earnings
|
|
20,346
|
|
61,585
|
|
87,256
|
|
89,581
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
share, basic
|
|
0.49
|
|
1.59
|
|
2.12
|
|
2.48
|
Adjusted earnings per
share, diluted
|
|
0.49
|
|
1.54
|
|
2.09
|
|
2.43
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding, basic
|
|
41,296,128
|
|
38,766,186
|
|
41,072,686
|
|
36,104,796
|
Weighted average number
of shares outstanding,
diluted
|
|
41,754,259
|
|
40,115,511
|
|
41,742,364
|
|
36,930,518
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
for purposes of dividend calculation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
September 30, 2023
|
|
|
In thousands of U.S.
Dollars except per share data
|
|
|
|
|
|
|
|
|
Adjusted earnings for
the purposes of dividend
calculation
|
|
|
|
|
|
20,346
|
|
|
|
|
|
|
|
|
|
|
|
Dividend to be
paid
|
|
|
|
|
|
6,782
|
|
|
Dividend Per Share
(DPS)
|
|
|
|
|
|
0.16
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares
outstanding as of November 7, 2023
|
|
|
|
|
|
41,298,849
|
|
|
Forward-Looking Statements
Matters discussed in this press release may constitute
forward-looking statements. The Private Securities Litigation
Reform Act of 1995 provides safe harbor protections for
forward-looking statements in order to encourage companies to
provide prospective information about their business.
Forward-looking statements 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 Company desires to take
advantage of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 and is including this cautionary
statement in connection with this safe harbor legislation. In some
cases, you can identify the forward-looking statements by the use
of words such as "believe", "anticipate", "intends", "estimate",
"forecast", "plan", "potential", "may", "expect", and similar
expressions.
Forward looking statements in this press release include, among
others, statements regarding: future operating or financial
results, including future earnings; global and regional economic
conditions and trends; shipping market trends and market
fundamentals, including tanker demand and supply and future spot
and charter rates; the potential effect of short-duration rate
spikes in key regional markets; the Company's business strategies,
initiatives and sustainability agenda, and related future outcomes;
the potential effect of the recently declared Hamas-Israel war on
the Company's business, results of operations, financial condition
and cash flows; expected employment of the Company's vessels and
expected drydocking days during the fourth quarter of 2023;
management's estimates of the Depreciated Replacement Value (DRV)
of its vessels and of the value of the Company's commercial
management and pooling business; trends in the Company's
performance as measured by energy efficiency and emission-reduction
metrics; the impact of energy transition on the Company and the
markets in which the Company operates; expected continuation of
refinement by the Company of performance measures for emissions and
efficiency; and the timing and payment of quarterly dividends by
the Company. The forward-looking statements in this press release
are based upon various assumptions, including, without limitation,
Ardmore management's examination of historical operating trends,
data contained in the Company's records and other data available
from third parties. Although the Company 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 the Company's control, the Company cannot assure you that it
will achieve or accomplish these expectations, beliefs or
projections. The Company cautions readers of this release not to
place undue reliance on these forward-looking statements, which
speak only as of their dates. The Company undertakes no obligation
to update or revise any forward-looking statements. These
forward-looking statements are not guarantees of the Company's
future performance, and actual results and future developments may
vary materially from those projected in the forward-looking
statements.
In addition to these important factors, other important factors
that, in the Company's 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 fluctuations in spot and charter rates
and vessel values; changes in demand for and the supply of tanker
vessel capacity; changes in the projections of spot and time
charter or pool trading of the Company's vessels; a lack of
simultaneous short-duration rate hikes in key regional markets;
future developments relating to Russia's invasion of the Ukraine (including related sanctions and
import bans) or the recently-declared Hamas-Israel war; changes in
the Company's operating expenses, including bunker prices,
drydocking and insurance costs; general domestic and international
political conditions; geopolitical conflicts; potential disruption
of shipping routes due to accidents, piracy or political events;
the market for the Company's vessels; competition in the tanker
industry; availability of financing and refinancing; changes in
governmental rules and regulations or actions taken by
regulatory authorities; the Company's ability to charter vessels
for remaining revenue days during the fourth quarter of 2023
in the spot market; vessel breakdowns and instances of off-hire;
the Company's operating results and capital requirements, and the
declaration of any future dividends by the Company's board of
directors; and other factors. Please see the Company's filings with
the U.S. Securities and Exchange Commission, including the
Company's Form 20–F for the year ended December 31, 2022, for a more complete discussion
of these and other risks and uncertainties.
Investor Relations
Enquiries:
|
|
|
Mr. Leon
Berman
|
Mr. Bryan
Degnan
|
The IGB
Group
|
The IGB
Group
|
45 Broadway, Suite
1150
|
45 Broadway, Suite
1150
|
New York, NY
10006
|
New York, NY
10006
|
Tel:
212–477–8438
|
Tel:
646–673–9701
|
Fax:
212–477–8636
|
Fax:
212–477–8636
|
Email: lberman@igbir.com
|
Email: bdegnan@igbir.com
|
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content:https://www.prnewswire.com/news-releases/ardmore-shipping-corporation-announces-financial-results-for-the-three-and-nine-months-ended-september-30-2023-301979356.html
SOURCE Ardmore Shipping Corporation