Vessel Name Type DWT Year Built
---------- ---------- ----------
Star Beta (1) Capesize 174,691 1993
Star Sigma Capesize 184,403 1991
Star Ypsilon Capesize 150,940 1991
Star Gamma Supramax 53,098 2002
Star Delta Supramax 52,434 2000
Star Epsilon Supramax 52,402 2001
Star Zeta Supramax 52,994 2003
Star Theta Supramax 52,425 2003
Star Kappa Supramax 52,055 2001
Star Omicron Supramax 53,489 2005
Star Cosmo Supramax 52,247 2005
Grand Total 11 931,178
(1) On January 18, 2010 the Company has entered into an agreement to sell
the vessel Star Beta to a third party for a contracted sale price of $22
million and expects to deliver the vessel to the buyers in the second
quarter of 2010 upon its redelivery from the current time charter.
(2) On February 18, 2010 the Company has entered into a definitive
agreement to purchase a Capesize vessel of approximately 171,000 dwt, built
in 2000 in Japan, for approximately $42.5 million from a third party with
expected delivery in the fourth quarter 2010.
Fourth Quarter 2009 and 2008 Results
For the quarter ended December 31, 2009, total revenues amounted to $31.2
million compared to $72.8 million for the quarter ended December 31, 2008.
This was mainly due to lower charter rates imposed by the market for most
of our vessels and the decreased amortization of fair value of below/above
market acquired time charters amounting $0.3 million for the three-month
period ended December 31, 2009 compared to $28.7 million for the
three-month period ended December 31, 2008. Operating loss amounted to $2.8
million for the quarter ended December 31, 2009 compared to operating
income of $54.3 million for the quarter ended December 31, 2008. Net loss
for the fourth quarter of 2009 amounted to $4.6 million or $0.07 loss per
share calculated on 61,049,760 weighted average number of shares, basic and
diluted. Net income for the fourth quarter of 2008 amounting to $50.2
million or $0.89 per basic and diluted shares calculated on 56,278,511
weighted average numbers of shares.
The fourth quarter of 2009 net loss figure includes the following non-cash
items:
-- Net revenue of $0.3 million or $0.01 per basic and diluted share,
representing amortization of fair value of below/above market acquired
time charters, attached to vessels acquired, over the remaining period
of the time charter into revenue.
-- A loss of $0.9 million or $0.02 per basic and diluted share associated
with a loss on the time charter agreement termination which relates to
the write-off of unamortized fair value of an above-market acquired
time charter on a vessel due to an early redelivery date.
Fourth quarter of 2008 net income figure includes the following non-cash
items:
-- Net revenue of $28.7 million or $0.51 per basic and diluted share,
representing amortization of fair value of below/above market acquired
time charters, attached to vessels acquired, over the remaining period
of the time charter into revenue.
-- Expenses of $1.3 million, or $0.02 per basic and diluted share relating
to stock-based compensation recognized in connection with the vesting
of a portion of 1,255,000 unvested restricted common shares issued to
directors and employees.
Adjusted EBITDA for the fourth quarter of 2009 and 2008 excluding the above
items was $11.0 million and $42.9 million, respectively. A reconciliation
of EBITDA and adjusted EBITDA to net cash provided by cash flows from
operating activities is set forth below.
An average of 11.89 and 12.10 vessels were owned and operated during the
fourth quarter of 2009 and 2008, respectively, earning an average Time
Charter Equivalent, ('TCE") rate per day of $23,012 and per day $41,521,
respectively. We refer you to the information under the heading "Summary of
Selected Data" later in this release for further information regarding our
calculation of TCE rates.
Total expenses, excluding the impairment loss from the sale of vessel Star
Alpha and the loss on time charter agreement termination, increased
approximately 17% to $33.0 million for the three-month period ended
December 31, 2009 compared to $28.2 million for the three-month period
ended December 31, 2008. Although depreciation and general and
administrative expenses decreased by 18% and 44%, respectively, the 17%
increase in expenses was mainly due to increased vessel voyage expenses and
a loss of $1.4 million related to derivative instruments.
Voyage expenses consist of hire paid for chartered-in vessels, port, canal
and fuel costs. There was a $7.1 million increase in voyage expenses in the
fourth quarter of 2009 as compared to the same period of 2008. The increase
is mainly due to the fact that on September 13, 2009 we chartered-in the
vessel Star Beta from its charterer to serve the third shipment under the
Vale's contract of affreightment (COA) and on November 6, 2009 we also
chartered-in a third party vessel to serve the fourth shipment under the
same COA.
Vessel operating expenses were $6.8 million for the fourth quarter of 2009
compared to $6.4 million for the same period last year.
Depreciation expenses decreased to $13.1 million for the fourth quarter of
2009 from $16.0 million for the fourth quarter of 2008. This decrease is
mainly due to the fact that there was no depreciation expense related to
Star Alpha during the quarter ended December 31, 2009 as this vessel was
reclassified as asset held for sale on July 20, 2009 and delivered to her
new owners on December 21, 2009.
General and administrative expenses decreased to $2.4 million for the
quarter ended December 31, 2009 from $4.3 million for the quarter ended
December 31, 2008, respectively. This decrease is mainly due to lower
stock-based compensation expense.
Years ended December 31, 2009 and 2008 Results
For the year ended December 31, 2009, total revenues amounted to $142.4
million compared to $238.8 million for the year ended December 31, 2008.
This decrease is mainly due to lower charter rates earned for most of our
vessels during 2009 and the decreased amortization of fair value of
below/above market acquired time charters to $5.7 million for the year
ended December 31, 2009 compared to $80.5 million for the year ended
December 31, 2008. Operating loss amounted to $49.3 million for the year
ended December 31, 2009 compared to operating income of $142.8 million for
the year ended December 31, 2008. Net loss for the year ended December 31,
2009 amounted to $58.4 million representing $0.96 loss per basic and
diluted share calculated on 60,873,421 weighted average number of basic and
diluted shares. Net income for the year ended December 31, 2008 amounted to
$133.7 million or $2.55 per basic share calculated on 52,477,947 weighted
average number of shares, and $2.46 per diluted share calculated on
54,280,472 weighted average number of shares.
Year ended December 31, 2009 net income figure includes the following
non-cash items:
-- Impairment loss of $75.2 million or $1.23 per basic and diluted share,
in connection with the sale of the vessel Star Alpha.
-- Net revenue of $5.7 million or $0.09 per basic and diluted share,
representing amortization of fair value of below/above market acquired
time charters, attached to vessels acquired, over the remaining period
of the time charter into revenue.
-- Expenses of $1.8 million, or $0.03 per basic and diluted share
relating to the stock-based compensation recognized in connection with
the vesting of a portion of 1,385,000 restricted shares (vested and
unvested) issued to directors and employees.
Year ended December 31, 2008 net income figure includes the following
non-cash items:
-- Vessel impairment loss of $3.6 million, or $0.07 per basic and diluted
share, in connection with the sale of the vessel Star Iota.
-- Net revenue of $80.5 million, or $1.53 and $01.48 per basic and diluted
share, respectively, attributable to the amortization of the fair value
of time charters attached to vessels acquired, over the remaining
period of the time charter.
-- Expenses of $4.0 million, or $0.08 and $0.07 per basic and diluted
share, respectively, relating to the stock-based compensation
recognized in connection with the vesting of a portion of 1,385,000
(vested and unvested) restricted common shares issued to directors and
employees.
Adjusted EBITDA for years ended December 31, 2009 and 2008 excluding all
the above items was $80.4 million and $120.9 million respectively. A
reconciliation of EBITDA and adjusted EBITDA to net cash provided by cash
flows from operating activities is set forth below.
An average of 11.97 and 10.76 vessels were owned and operated during the
years ended December 31, 2009 and 2008, respectively, earning an average
TCE rate per day of $29,450 and $42,824, respectively. We refer you to the
information under the heading "Summary of Selected Data" later in this
release for further information regarding our calculation of TCE rates.
Total expenses increased to $121.6 million for the year ended December 31,
2009 compared to $102.2 million for the year ended December 31, 2008 due to
higher vessel operating and voyage expenses and depreciation as a result of
a longer period of operations arising from higher ownerships days. Vessel
operating expenses were $30.2 million for the year ended December 31, 2009
compared to $26.2 million for the same period last year. The increase in
vessel operating expenses was due to the operation of a larger fleet,
higher crewing and insurance expenses.
Depreciation expenses increased approximately 14% to $58.3 million for the
year ended December 31, 2009 from $51.1 million for the year ended December
31, 2008 arising from higher ownerships days. General and administrative
expenses decreased approximately 30% to $8.7 million for the year ended
December 31, 2009 from $12.4 million the year ended December 31, 2008,
respectively. This decrease was mainly due to lower stock based
compensation expense.
Liquidity and Capital Resources
Cash Flows
Net cash provided by operating activities for the year ended December 31,
2009 and 2008, was $65.8 million and $110.7 million, respectively. Net
cash provided by operating activities for the year ended December 31, 2009
was primarily a result of recorded net loss of $58.4 million, adjusted for
depreciation of $58.3 million, and an impairment loss from sale of vessel
Star Alpha of $75.2 million, and offset by amortization of fair value of
below/above market acquired time charter agreements of $5.7 million. Net
cash provided by operating activities for the year ended December 31, 2008
was primarily a result of recorded net income of $133.7 million, adjusted
for depreciation, stock based compensation and the vessel impairment loss
related to the sale of the vessel Star Iota of $58.7 million offset by the
amortization of the fair value of below/above market acquired time charter
agreements of $80.5 million.
Net cash used in investing activities for the years ended December 31, 2009
and 2008 was $1.4 million as compared to $423.3 million used in investing
activities, respectively. Net cash provided by investing activities for the
year ended December 31, 2009, was primarily a result of the proceeds from
sale of vessel Star Alpha amounting to $19.1 million offset by an increase
in restricted cash of $20.5 million relating to the waivers obtained for
existing loan agreements. For the year ended December 31, 2008 the cash
used in investing activities related mainly to the payment of the cash
consideration of $413.5 million for our initial fleet and additional
vessels, $14.4 million related to the purchase price allocated to the
above-market time charters and 12.0 million related to an increase in
restricted cash, which was offset by $16.6 million which represented
proceeds from the sale of the Star Iota.
Net cash used in financing activities for the year ended December 31, 2009
was $53.8 million as compared to $323.0 million of net cash provided by
financing activities for the year ended December 31, 2008. For the year
ended December 31, 2009, net cash used in financing activities consisted of
loan installment payments amounting to $49.3 million and cash dividend
payments of $6.2 million, offset by cash provided from our directors'
dividend reinvestment of $1.9 million. For the year ended December 31, 2008
net cash provided by financing activities consisted of the drawdown of
$317.5 million related to our loan facilities and the proceeds from
exercise of warrants of $94.2 million mainly offset by $52.6 million of
cash dividends paid, $21.0 million of repayments under our loan agreements
and payments of $13.4 million in connection with our repurchase of common
stock and warrants.
Summary of Selected Data
(TCE rates expressed in U.S. dollars)
3 months ended 3 months ended
December 31, 2008 December 31, 2009
----------------- -----------------
Average number of vessels (1) 12.10 11.82
----------------- -----------------
Number of vessels (as of the last day
of the periods reported) 12 11
----------------- -----------------
Average age of operational fleet (in
years) (2) 9.7 10.0
----------------- -----------------
Ownership days (3) 1,109 1,094
----------------- -----------------
Available days (4) 1,087 1,048
----------------- -----------------
Voyage days for fleet (5) 1,043 1,000
----------------- -----------------
Fleet utilization (6) 96.0% 95.4%
----------------- -----------------
Average per-day TCE rate (7) $ 41,521 $ 23,012
----------------- -----------------
12 months ended 12 months ended
December 31, 2008 December 31, 2009
----------------- -----------------
Average number of vessels (1) 10.76 11.97
----------------- -----------------
Number of vessels (as of the last day
of the periods reported) 12 11
----------------- -----------------
Average age of operational fleet (in
years) (2) 9.7 10.0
----------------- -----------------
Ownership days (3) 3,927 4,370
----------------- -----------------
Available days (4) 3,716 4,240
----------------- -----------------
Voyage days for fleet (5) 3,616 4,117
----------------- -----------------
Fleet Utilization (6) 97.3% 97.1%
----------------- -----------------
Average per-day TCE rate (7) $ 42,824 $ 29,450
----------------- -----------------
(1) Average number of vessels is the number of vessels that constituted our
fleet for the relevant period, as measured by the sum of the number of days
each vessel was a part of our fleet during the period divided by the number
of calendar days in that period.
(2) Average age of operational fleet is calculated as at December 31, 2008
and 2009, respectively.
(3) Ownership days are the total calendar days each vessel in the fleet was
owned by Star Bulk for the relevant period.
(4) Available days for the fleet are the ownership days after subtracting
for off-hire days with major repairs, dry-docking or special or
intermediate surveys or transfer of ownership.
(5) Voyage days are the total days the vessels were in our possession for
the relevant period after subtracting all off-hire days incurred for any
reason (including off-hire for dry-docking, major repairs, special or
intermediate surveys).
(6) Fleet utilization is calculated by dividing voyage days by available
days for the relevant period and takes into account the dry-docking
periods.
(7) Represents the weighted average per-day TCE rates, of our entire fleet.
TCE rate is a measure of the average daily revenue performance of a vessel
on a per voyage basis. Our method of calculating TCE rate is determined by
dividing voyage revenues (net of voyage expenses and amortization of fair
value of above/below market acquired time charter agreements) 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, as
well as commissions. TCE rate 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 charters, time charters and bareboat charters) under which the vessels
may be employed between the periods. We included TCE revenues, a non-GAAP
measure, as it provides additional meaningful information in conjunction
with voyage revenues, the most directly comparable GAAP measure, because it
assists our management in making decisions regarding the deployment and use
of its vessels and in evaluating their financial performance. TCE rate is
also included herein because it 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 charters, time charters and bareboat charters) under which the vessels
may be employed between the periods and because we believe that it presents
useful information to investors.
Unaudited Consolidated Condensed Statement of Operations
3 months 3 months 12 months 12 months
(Expressed in thousands of ended ended ended ended
U.S. dollars except for December December December December
share and per share data) 31, 2008 31, 2009 31, 2008 31, 2009
---------- ---------- ---------- ----------
Revenues: 72,783 31,228 238,883 142,351
Expenses:
Voyage expenses (761) (7,895) (3,504) (15,374)
Vessel operating expenses (6,452) (6,843) (26,198) (30,168)
Drydocking expenses (652) (1,368) (7,881) (6,122)
Depreciation (16,011) (13,082) (51,050) (58,298)
Management fees (300) (69) (1,367) (771)
Gain/(loss) on derivative
instruments 251 (1,352) 251 (2,154)
General and administrative
expenses (4,298) (2,424) (12,424) (8,742)
---------- ---------- ---------- ----------
Total expenses (28,223) (33,033) (102,173) (121,629)
Vessel impairment loss (21) (116) (3,646) (75,208)
(Loss)/gain on time charter
agreement termination 9,711 (903) 9,711 5,179
---------- ---------- ---------- ----------
Operating income/(loss) 54,250 (2,824) 142,775 (49,307)
---------- ---------- ---------- ----------
Interest and finance costs (4,379) (2,056) (10,238) (9,914)
Interest income 330 320 1,201 806
---------- ---------- ---------- ----------
Total other expenses, net (4,049) (1,736) (9,037) (9,108)
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income/(loss) 50,201 (4,560) 133,738 (58,415)
========== ========== ========== ==========
Earnings/(loss) per share,
basic 0.89 (0.07) 2.55 (0.96)
========== ========== ========== ==========
Earnings/(loss) per share,
diluted 0.89 (0.07) 2.46 (0.96)
========== ========== ========== ==========
Weighted average number of
shares outstanding, basic 56,278,511 61,049,760 52,477,947 60,873,421
========== ========== ========== ==========
Weighted average number of
shares outstanding,
diluted 56,278,511 61,049,760 54,280,472 60,873,421
========== ========== ========== ==========
Unaudited Consolidated Condensed Balance Sheets
(Expressed in thousands of U.S. dollars)
ASSETS December 31, 2008 December 31, 2009
----------------- -----------------
Cash and restricted cash 31,961 48,495
Other current assets 10,312 12,333
----------------- -----------------
TOTAL CURRENT ASSETS 42,273 60,828
Fixed assets, net 821,284 668,698
Restricted cash 12,010 29,920
Other non-current assets 15,809 1,195
----------------- -----------------
TOTAL ASSETS 891,376 760,641
================= =================
Current portion of long-term debt 49,250 59,675
Other current liabilities 8,037 11,417
----------------- -----------------
TOTAL CURRENT LIABILITIES 57,287 71,092
Long-term debt 247,250 187,575
Other non-current liabilities 26,699 2,717
----------------- -----------------
TOTAL LIABILITIES 331,236 261,384
STOCKHOLDERS' EQUITY 560,140 499,257
----------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY 891,376 760,641
================= =================
Unaudited Cash Flow Data
(Expressed in thousands of U.S. 12 months ended 12 months ended
dollars) December 31, 2008 December 31, 2009
----------------- -----------------
Net cash provided by operating
activities 110,747 65,877
Net cash (used in)/provided by
investing activities (423,305) (1,431)
Net cash provided by/(used in)
financing activities 323,048 (53,779)
EBITDA and adjusted EBITDA Reconciliation
Star Bulk considers EBITDA to represent net income before interest, income
taxes, depreciation and amortization. EBITDA does not represent and should
not be considered as an alternative to net income or cash flow from
operations, as determined by United States generally accepted accounting
principles ("U.S. GAAP"), and our calculation of EBITDA may not be
comparable to that reported by other companies. EBITDA is included herein
because it is a basis upon which the Company assesses its liquidity
position it is used by our lenders as a measure of our compliance with
certain loan covenants and because the Company believes that it presents
useful information to investors regarding the Company's ability to service
and/or incur indebtedness.
The Company excluded amortization of the fair value of above/below market
acquired time charters associated with time charters attached to vessels
acquired, vessel impairment loss, non-cash gain or loss related to early
time charter termination and stock-based compensation expense recognized
during the period, to derive adjusted EBITDA. The Company excluded the
above non-cash items to derive adjusted EBITDA because the Company believes
that these non-cash items do not reflect the operational cash inflows and
outflows of the Company's fleet.
The following table reconciles net cash provided by operating activities to
EBITDA and adjusted EBITDA:
12 12
3 months 3 months months months
period period period period
ended ended ended ended
(Expressed in thousands of U.S. December December December December
dollars) 31, 2008 31, 2009 31, 2008 31, 2009
-------- -------- -------- --------
Net cash provided by operating
activities 27,055 6,900 110,747 65,877
Net increase in current assets 9,381 2,013 11,881 5,140
Net decrease/(increase) in
operating liabilities, excluding
current portion of long term debt 2,249 179 (10,705) 846
Amortization of fair value of
above/below market acquired time
charter agreements 28,722 330 80,533 5,735
Vessel impairment loss (21) (116) (3,646) (75,208)
Other non cash charges (10) 1 (53) (5)
Amortization of deferred finance
charges (87) (82) (234) (580)
Stock - based compensation (1,328) (82) (3,986) (1,832)
Change in fair value of derivatives 251 282 251 31
Non-cash (loss)/gain on time
charter agreement termination - (903) - (121)
Net Interest expense 4,086 1,736 9,052 9,108
-------- -------- -------- --------
EBITDA 70,298 10,258 193,840 8,991
======== ======== ======== ========
Less:
Amortization of fair value of
above/below market acquired time
charter agreements (28,722) (330) (80,533) (5,735)
Plus:
Stock-based compensation 1,328 82 3,986 1,832
Non-cash loss on time charter
agreement termination 903 121
Vessel impairment loss 21 116 3,646 75,208
-------- -------- -------- --------
Adjusted EBITDA 42,925 11,029 120,939 80,417
======== ======== ======== ========
Conference Call details:
Star Bulk's management team will host a conference call to discuss the
Company's financial results tomorrow, Wednesday, February 24, 2010, at 9:30
a.m., Eastern Standard Time (EST).
Participants should dial into the call 10 minutes before the scheduled time
using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329
(from the UK) or +(44) (0) 1452 542 301 (from outside the US). Please quote
"Star Bulk."
A replay of the conference call will be available until March 3, 2010. The
United States replay number is 1(866) 247-4222; from the UK 0(800)
953-1533; the standard international replay number is (+44) (0) 1452 550
000 and the access code required for the replay is: 3128607#.
Slides and audio webcast:
There will also be a simultaneous live webcast over the Internet, through
the Star Bulk website (www.starbulk.com). Participants to the live webcast
should register on the website approximately 10 minutes prior to the start
of the webcast.
About Star Bulk
Star Bulk is a global shipping company providing worldwide seaborne
transportation solutions in the dry bulk sector. Star Bulk's vessels
transport major bulks, which include iron ore, coal and grain and minor
bulks such as bauxite, fertilizers and steel products. Star Bulk was
incorporated in the Marshall Islands on December 13, 2006 and is
headquartered in Athens, Greece. Its common stock and warrants trade on the
Nasdaq Global Market under the symbols "SBLK" and "SBLKW" respectively.
Currently, Star Bulk has an operating fleet of eleven dry bulk carriers.
The total fleet consists of three Capesize, and eight Supramax dry bulk
vessels with an average age of approximately 10.2 years and a combined
cargo carrying capacity of 931,178 deadweight tons.
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. The
words "believe," "anticipate," "intends," "estimate," "forecast,"
"project," "plan," "potential," "may," "should," "expect," "pending" and
similar expressions identify forward-looking statements.
The forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, examination by the Company's management of
historical operating trends, data contained in its 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.
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 charter rates and vessel values, changes in demand for dry
bulk shipping capacity, changes in the Company's operating expenses,
including bunker prices, drydocking and insurance costs, the market for the
Company's vessels, availability of financing and refinancing, changes in
governmental rules and regulations or actions taken by regulatory
authorities, potential liability from pending or future litigation, general
domestic and international political conditions, potential disruption of
shipping routes due to accidents or political events, vessels breakdowns
and instances of off-hires and other factors. Please see our filings with
the Securities and Exchange Commission for a more complete discussion of
these and other risks and uncertainties. The information set forth herein
speaks only as of the date hereof, and the Company disclaims any intention
or obligation to update any forward-looking statements as a result of
developments occurring after the date of this communication.
Contact Information: Contacts: Company: George Syllantavos CFO Star Bulk Carriers Corp. c/o Star Bulk Management Inc. 7 Fragoklisias Str. Maroussi 15125 Athens, Greece www.starbulk.com Investor Relations / Financial Media: Nicolas Bornozis President Capital Link, Inc. 230 Park Avenue, Suite 1536 New York, NY 10169 Tel. (212) 661-7566 E-mail: starbulk@capitallink.com www.capitallink.com