EuroDry Ltd. Reports Results for the Quarter Ended March 31, 2021 and Announces Agreement to Acquire M/V Blessed Luck, a 2004-Japanese Built Panamax Bulker

Κυριακή, 23 Μαΐου 2021 16:37
EuroDry Ltd. Reports Results for the Quarter Ended March 31, 2021 and Announces Agreement to Acquire M/V Blessed Luck, a 2004-Japanese Built Panamax Bulker

EuroDry Ltd., an owner and operator of drybulk vessels and provider of seaborne transportation for drybulk cargoes, announced its results for the three-month period ended March 31, 2021 and an agreement to acquire M/V Blessed Luck, a 76,704 dwt drybulk vessel built in Japan.

First Quarter 2021 Highlights:

Total net revenues of $8.6 million; net income of $0.9 million; net income attributable to common shareholders (after a $0.3 million dividend on Series B Preferred Shares and a $0.1 million preferred deemed dividend arising out of the net redemption of approximately $3 million of Series B Preferred Shares in the first quarter of 2021) of $0.4 million or $0.19 earnings per share basic and diluted. Adjusted net income attributable to common shareholders1 for the period was $1.3 million or $0.55 earnings per share basic and diluted.

Adjusted EBITDA1 was $4.0 million.

An average of 7.0 vessels were owned and operated during the first quarter of 2021 earning an average time charter equivalent rate of $14,924 per day.

The Company declared a dividend of $0.3 million on its Series B Preferred Shares. The dividend will be paid in cash.

1Adjusted EBITDA, Adjusted net income/(loss) and Adjusted earnings/(loss) per share are not recognized measurements under US GAAP (GAAP) and should not be used in isolation or as a substitute for EuroDry’s financial results presented in accordance with GAAP. Refer to a subsequent section of the Press Release for the definitions and reconciliation of these measurements to the most directly comparable financial measures calculated and presented in accordance with GAAP.

M/V Blessed Luck Acquisition

The Company also announced that it has agreed to acquire M/V Blessed Luck, a 76,704 dwt drybulk vessel built in 2004 in Japan, for $12.12 million. The vessel is majority owned by a third party and has been managed by Eurobulk Ltd., also the manager of three of the Company’s vessels. The vessel is expected to be delivered to the Company within May 2021. The acquisition will be financed partly by a short term sellers’ credit of $5 million and an one year bridge loan of $6 million provided by an entity affiliated with the Company’s Chief Executive Officer with the remaining funds coming from the Company; both the sellers’ credit and short term loan carry an annual interest of 8%. In parallel, the Company is in the process of arranging a bank loan with the acquired vessel as collateral, expected to be finalized within approximately three months, which will provide sufficient funds to repay the sellers’ credit and, possibly, part of the bridge loan. At the same time, the Company entered into a charter agreement for the vessel for a period between a minimum of 11 months and a maximum of 13 months at a rate of $19,500/day which will commence upon delivery of the vessel and contribute about $4 million of EBITDA during the minimum period of the charter.

Aristides Pittas, Chairman and CEO of EuroDry commented:
“In stark contrast to a year ago, it has been a very positive 2021 so far with drybulk rates rebounding significantly as a result of solid trade growth and limited supply growth. The latter, especially, is constrained by short and medium term factors: in the short term, by inefficiencies in the vessel-port transportation system that resulted from COVID-19 effects and required protocols and, in the medium term, by the lowest orderbook in the last 20+ years. We believe that the market is likely to remain strong for the next couple of years provided that demand for transportation of drybulk cargoes – which is generally linked to economic activity – will maintain at least a historically average growth rate; it is noteworthy that the IMF, amongst others, predicts that economic activity will rebound above historical average levels as the world recovers from the COVID-19 pandemic.

In such a positive environment, our main strategy is to try to expand our fleet in a risk efficient way despite our limited funds available for investment. Thus, we acquired M/V Blessed Luck, a 2004-built vessel, with a combination of seller and affiliate bridge loans to complement our cluster of medium age Japanese-built Panamax-size vessels alongside our cluster of own-built newbuildings. The acquisition of M/V Blessed Luck will increase our fleet to eight units and is expected to contribute to a proportional increase in our EBITDA. At the present market rate levels, we are to accumulate funds that will provide us with several investment or expansion options or shareholder reward models. We, further, believe that the strong drybulk markets enhance the value of our public listing as a consolidation platform and we continuously investigate opportunities to take advantage of it.”

Tasos Aslidis, Chief Financial Officer of EuroDry commented:
“Our net revenues for the first quarter of 2021 were higher by 69.3% as compared to the first quarter of 2020. This was the result of higher average charter rates by 89.3% earned during the quarter as compared to the first quarter of 2020 and 38.7% higher when compared to the fourth quarter of 2020.

Total daily vessel operating expenses, including management fees, general and administrative expenses, but excluding drydocking costs, increased by approximately 8.5% during the first quarter of 2021 compared to the same quarter of last year. This increase is mainly due to increased crewing costs in 2021 compared to 2020, resulting from difficulties in crew rotation due to COVID-19 related restrictions.

Adjusted EBITDA during the first quarter of 2021 was $4.0 million compared to $0.6 million achieved for the first quarter of last year. As of March 31, 2021, our outstanding debt (excluding the unamortized loan fees) was $56.0 million versus restricted and unrestricted cash of approximately $6.2 million.”

First Quarter 2021 Results:
For the first quarter of 2021, the Company reported total net revenues of $8.6 million representing a 69.3% increase over total net revenues of $5.1 million during the first quarter of 2020, which was the result of the higher time charter rates our vessels earned during the first quarter of 2021. The Company reported net income for the period of $0.9 million and net income attributable to common shareholders of $0.4 million, as compared to a net loss and a net loss attributable to common shareholders of $2.3 million and $2.6 million, respectively, for the same period of 2020. For the first quarter of 2021, a gain on bunkers resulted in positive voyage expenses of $0.3 million for the period as compared to voyage expenses of $0.4 million in the same period of 2020. Depreciation expenses for the first quarter of 2021 were $1.7 million compared to $1.6 million for the same period of 2020. Vessel operating expenses were $3.1 million for the first quarter of 2021 compared to $2.8 million in the same period of 2020, mainly due to increased crewing costs in the first quarter of 2021 compared to the corresponding period in 2020, resulting from difficulties in crew rotation due to COVID-19 related restrictions. Management fees and general and administrative expenses remained unchanged at $0.5 million and $0.6 million, respectively, for the first quarter of 2021 as compared to the same period of last year.

Interest and other financing costs for the first quarter of 2021 amounted to $0.6 million, slightly decreased as compared to $0.7 million for the same period of 2020. Interest during the first quarter of 2021 was lower due to lower average debt during the period and the decreased Libor rates of our loans during the period as compared to the same period of last year. For the three months ended March 31, 2021, the Company recognized a $1.6 million loss on derivatives, comprised of $0.7 million realized loss and $1.1 million unrealized loss of forward freight agreements and $0.2 million gain on three interest rate swaps as compared to a loss on interest rate swaps of $0.3 million for the same period of 2020.

On average, 7.0 vessels were owned and operated during the first quarter of 2021 earning an average time charter equivalent rate of $14,924 per day compared to 7.0 vessels in the same period of 2020 earning on average $7,885 per day.

Adjusted EBITDA for the first quarter of 2021 was $4.0 million compared to $0.6 million achieved during the first quarter of 2020.

Basic and diluted earnings per share attributable to common shareholders for the first quarter of 2021 was $0.19 calculated on 2,291,471 basic and 2,320,577 diluted weighted average number of shares outstanding, compared to basic and diluted loss per share of $1.17 for the first quarter of 2020, calculated on 2,267,375 basic and diluted weighted average number of shares outstanding.

Excluding the effect on the earnings attributable to common shareholders for the quarter of the unrealized loss on derivatives, the adjusted earnings attributable to common shareholders for the quarter ended March 31, 2021 would have been $0.55 per share basic and diluted, compared to an adjusted loss of $0.91 per share basic and diluted for the quarter ended March 31, 2020, after excluding the effect of the unrealized loss on derivatives and the loss on write-down of inventory. Usually, security analysts do not include the above items in their published estimates of earnings per share.

View Full Report

Videos

  • 19th Hydra Meeting 2017 - 9
    • 19th Hydra Meeting 2017 - 9

    • Watch Video

  • 19th Hydra Meeting 2017 - 6
    • 19th Hydra Meeting 2017 - 6

    • Watch Video

  • 19th Hydra Meeting 2017 - 4
    • 19th Hydra Meeting 2017 - 4

    • Watch Video

  • 19th Hydra Meeting 2017 - 2
    • 19th Hydra Meeting 2017 - 2

    • Watch Video

Tα cookies μας βοηθούν να σας παρέχουμε καλύτερες υπηρεσίες. Χρησιμοποιώντας τις υπηρεσίες μας συμφωνείτε στη χρήση των cookies.
Ok