28 Aug 2015 18:29
Goldenport Holdings Inc.
Athens, 28 August 2015
Interim Results for the Half Year 30 June 2015
Goldenport Holdings Inc. ("Goldenport" or "the Company"), (LSE: GPRT) the international shipping company that owns and operates a fleet of dry bulk and container vessels, announces today its Interim Results for the six months ended 30 June, 2015.
Financial Highlights (amounts in US$ '000 except per share data):
Six months ended 30 June 2015
§ Revenue of US$ 18,478, -25.2% decrease (2014: US$ 24,694)
§ EBITDA of US$ 4,364, -42.3% decrease (2014: US$ 7,566)
§ Net Loss of US$ 14,665 (2014: Net Loss of US$ 1,391)
§ Loss per Share of US$ 1.57 (2014: Loss per share US$ 0.15)
§ Total cash at 30 June 2015 of US$ 9,155 (31 December 2014: US$ 25,940)
§ Net debt to book capitalisation as of 30 June 2015, 51% (31 December 2014: 44%)
CEO Statement:
For the six months ended 30 June 2015, the Company reported a 25.2% decline in revenues, reflecting a decrease in the average number of vessels from 15 to 13, and a 14.2% reduction in the time charter equivalent rate for the fleet that was partly offset in dollar terms by a reduction in average daily operating expenses. The Company reported a 42.3% drop in EBITDA to U.S.$4,364 and a net loss of U.S.$14,665 or U.S.$1.57 per share. The net loss is primarily as a result of the impairment of the value of M/V Ermis and M/V Alpine Trader that are being held for sale by U.S.$7,722 and the impairment of the value of three old containerships by U.S.$3,346. The adjusted net loss excluding these impairments and other provisions and charges was U.S.$3,597 or U.S.$0.38 per share.
The dry bulk sector remained at a 30-year low in the first half of 2015 due to lower volumes, primarily as a result of a global reduction in coal shipments, particularly for Chinese imports. The rally that started in the middle of June on the back of restocking of Chinese iron ore inventories was unfortunately short-lived and ended in the beginning of August with dry bulk charter rates giving up most of their gains over the last four weeks. The market outlook remains fairly muted and volatile due to uncertainties over Brazilian exports and Chinese demand, as well as the overhang from a large number of newbuilding vessels that are due to be delivered until the end of 2016. There is a glimmer of hope for 2017, provided that owners continue to resist tempting approaches from loss-making shipyards and, hence, newbuilding ordering activity remains subdued.
It should be noted that the recent collapse in scrap prices by more than 25% to less than US$300/ton has brought scrapping activity to an abrupt halt after having reached record levels in the first half of 2015 which had fostered increased scrapping of older tonnage and offered support to charter rates. Supramax rates were once again more resilient than Capesize and Panamax rates, reflecting their versatility and reduced earnings volatility, but 2015 has so far proved to be more challenging than 2014, as demonstrated by the average BSI TC rate of U.S.$6,605 for the first half of 2015 and U.S.$10,302 for the first half of 2014. The Supramax FFA (Forward Freight Agreement) for the remainder of 2015 and for calendar year 2016 are currently trading at U.S.$8,550 and U.S.$7,100 per day.
In the containership sector, we experienced a steady increase in time charter rates and vessel values for Panamax and Sub-Panamax vessels until June 2015, followed by a sharp correction in July and August on the back of reduced fixing activity reflecting subdued demand. We continue to believe that these vessel categories that specialize in North-South and intra-region routes will benefit from the overall growth in containerized shipping, but the outlook for the sector hinges on geopolitical uncertainties receding and global economic growth picking up.
In March 2015, before the collapse in scrap prices, we scrapped M/V Golden Trader and in the beginning of July we completed the sale of M/V Thira for further trading. We recorded a U.S.$105 loss from the disposal of M/V Golden Trader and will be recording a U.S.$2,472 gain from the disposal of M/V Thira in the second half of the year. In both cases, we utilized part of the cash proceeds to further reduce our debt and the balance to increase our liquidity position. We are not planning to scrap any additional vessels in the coming months, as the old containerships are generating free cash flow, whereas scrapping them would yield cash proceeds that would not have any material impact from a liquidity point of view. We have also continued to proactively manage our indebtedness and agreed a relaxation of the minimum asset cover ratios and financial covenants with our lenders, reflecting the adverse market conditions.
We are navigating through what is arguably the worst dry bulk market of the last 30 years and the long-awaited, sustainable recovery is unlikely to materialize in the near term. We have taken all steps available to us to position the Company to weather the current storm, including proceeding with the sale of several older and less efficient vessels, restructuring our bank facilities to reflect the current trading environment and de-levering our balance sheet, while maintaining a competitive operating cost base. However, the reduction in fleet size that has strengthened the liquidity position of the Company, has also taken its toll on its cash flow generation capacity, and we will continue to face challenges in the event that dry cargo charter rates do not improve.
Fleet Developments:
Disposals:
On 25 March 2015, the Company agreed the disposal of M/V Golden Trader to an unaffiliated third party. The sale was concluded at a net cash consideration of US$3,927 and the vessel was delivered to the new owners on 9 April 2015. As of delivery date, M/V Golden Trader had a net carrying value of US$4,032. The loss resulting from the sale of the vessel was US$105 and is included in the consolidated statement of comprehensive income.
On 25 June 2015 the Company concluded a memorandum of agreement for the disposal of M/V Thira to an unaffiliated third party for U.S $6,850. An amount of U.S.$2,965 from the sale proceeds was applied towards the repayment of the debt secured against the vessel. The vessel was delivered to her new owners on 21 July 2015 and the Company realized an aggregate gain from the sale of the vessel of U.S.$2,472 which will be included in the Company's consolidated statement of comprehensive income during the third quarter of 2015.
As of today the fleet consists of 13 vessels, of which 5 are container vessels and 8 dry bulk carriers.
Approach from a potential bidder:
Following the announcement by the Company on 19 June 2015 that it had received an approach from a potential bidder, which was subject to the condition that the offer be recommended by the independent directors of the Company, the independent directors and the potential bidder promptly engaged in detailed discussions but failed to reach agreement.
Conference Call and Webcast:
The Company's management will hold a conference call on Tuesday 1 September 2015 at 1:00 P.M. (BST), 3:00 P.M. (Athens), 08:00 A.M. (EDT), to discuss the results.
CONFERENCE CALL DETAILS:
Date: 1 September 2015
Time: 13:00 London Time / 08:00 am NY Time / 15:00 Athens Time
DIAL IN INFORMATION: Participants should dial into the call 10 minutes before the scheduled time using the following numbers: + 44 (0) 800 368 1063 (from UK), + 1 866 288 9315 (from US) or + 44 (0) 20 7075 3205 (all other callers). Please quote "Goldenport Holdings" to the operator.
LIVE WEBCAST: The conference call will be webcast in real time over the Internet and you may join by linking at the internet site http://themediaframe.eu/links/Goldenport150901.html
If you experience difficulty, please call + 30 210 9460803.
REPLAY
If you are unable to participate, a recording of the conference will be available one hour after the conclusion of the conference call until the end of business day of 7 September 2015.
To access the recording, please dial the following numbers:
Tel for UK and international : + 44 (0) 203 0595874
Tel for US : + 1 866 288 9317
Access code : 47475#
A full version of the Interim Results for the Half Year Ended 30 June 2015 statement with accompanying accounts can be found on the following link:
http://www.rns-pdf.londonstockexchange.com/rns/5379X_1-2015-8-28.pdf
For further information, please contact:
Goldenport Holdings Inc.
John Dragnis, Chief Executive Officer +30 210 8910 500
Alexis Stephanou, Chief Financial Officer +30 210 8910 542
finance@goldenport.biz
Tavistock Communications
Jos Simson / Emily Fenton +44 (0) 20 7920 3150