NEW YORK, March 14, 2018 /PRNewswire/ -- Gener8
Maritime, Inc. (NYSE: GNRT) ("Gener8 Maritime" or the "Company"), a
leading U.S.-based provider of international seaborne crude oil
transportation services, today announced its financial results for
the three months and twelve months ended December 31, 2017.
Highlights
- Recorded net loss of $45.4
million, or $0.55 basic and
diluted loss per share, for the three months ended December 31, 2017, compared to a net income of
$5.8 million, or $0.07 basic and diluted income per share for the
same period in the prior year.
- Recorded adjusted net loss of $18.6
million, or $0.22 basic and
diluted adjusted loss per share, for the three months ended
December 31, 2017, compared to
adjusted net income of $20.1 million
or $0.24 basic and diluted adjusted
income per share for the same period in the prior year.
- Increased full fleet "ECO" operating days to 65.1% in the three
months ended December 31, 2017,
compared to 43.4% in the same period in the prior year.
- Sold a 2003-built Aframax (Gener8 Pericles), a
2000-built Suezmax (Gener8 Argus), a 2002-built VLCC
(Gener8 Poseidon), and a 2010-built VLCC (Gener8
Zeus) for net cash proceeds of $33.2
million after debt repayment of $63.8
million and release of working capital from the Navig8
pools.
- Entered into an Agreement and Plan or Merger with Euronav NV
and Euronav MI Inc., a wholly-owned subsidiary of Euronav NV.
Merger Agreement
On December 20, 2017, we entered
into an Agreement and Plan of Merger (the "Merger Agreement") with
Euronav NV and Euronav MI Inc., a wholly-owned subsidiary of
Euronav NV ("Merger Sub"). Pursuant to the Merger Agreement, among
other things, Merger Sub will merge with and into the Company, with
the Company continuing its corporate existence as the surviving
corporation and as a wholly-owned subsidiary of Euronav NV (which
transactions we refer to as the "Merger").
At the effective time of the Merger, each common share, par
value $0.01 per share, of Gener8 (the
"Gener8 common shares"), issued and outstanding immediately prior
to such time (other than certain Gener8 common shares that will be
canceled as set forth in the Merger Agreement), will be canceled
and automatically converted into the right to receive 0.7272 of an
ordinary share, no par value per share, of Euronav in the manner
described in the Merger Agreement.
The completion of the Merger is subject to the satisfaction or
waiver of a number of conditions as set forth in the Merger
Agreement, including, among others, the approval of the Merger
Agreement by holders of a majority of the outstanding Gener8 common
shares. There can be no assurance as to when these conditions will
be satisfied or waived, if at all, or that other events will not
intervene to delay or result in the failure to complete the Merger.
Each party's obligation to complete the Merger is also subject to
the accuracy of the representations and warranties of the other
party (subject to certain qualifications and exceptions) and the
performance in all material respects of the other party's covenants
under the Merger Agreement.
In connection with the entry into the Merger Agreement, Euronav
and certain significant holders (the "Covered Shareholders") of
Gener8 common shares have entered into a Shareholder Support and
Voting Agreement (the "Voting Agreement"). The Voting Agreement
requires the Covered Shareholders, representing approximately 42%
of the issued and outstanding shares of Gener8 to (i) appear (in
person or by proxy) at any meeting of the shareholders convened for
the purpose of approving the Merger and the Merger Agreement (the
"Special Meeting") and (ii) so long as neither the transaction
advisory committee of the Gener8 board of directors (the "Gener8
Transaction Committee") nor the Gener8 board of directors has made
an Adverse Recommendation Change (as defined in the Merger
Agreement), vote the Covered Shares in favor of the Merger
Agreement and the transactions contemplated thereby, including the
Merger, and against any action that would reasonably be expected to
impede the Merger or result in a breach of the Merger Agreement or
the Voting Agreement. If either the Gener8 Transaction Committee or
the Gener8 board of directors does make an Adverse Recommendation
Change, then the Covered Shareholders are each required to vote 50%
of their respective Covered Shares in favor of the Merger Agreement
and the transactions contemplated thereby, including the Merger,
and may vote their remaining Covered Shares in any manner they
determine.
In addition, at the request (and expense) of Euronav, certain
Gener8 shareholders (the "Proxy Shareholders") have agreed to grant
an irrevocable proxy (the "Proxies") to a representative of an
affiliate of such Proxy Shareholders whereby, subject to the terms
and conditions in the Proxies, such representative has the
authority to direct the vote of Gener8 common shares owned by the
Proxy Shareholders, representing in the aggregate approximately 6%
of the issued and outstanding shares of Gener8, at the Special
Meeting. In addition, the Proxy Shareholders have agreed, among
other things, not to transfer or dispose any of their Gener8 common
shares during the term of the Proxies unless the transferee agrees
to be bound thereby.
For more information about the Merger, see the Company's Current
Report on Form 8-K, filed on December 22,
2017.
Fleet Performance
The average TCE rates earned by Gener8 Maritime's vessels are
detailed below:
Gener8 Maritime
Average Daily TCE Rates(1)
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
Dec-17
|
Dec-16
|
|
Dec-17
|
Dec-16
|
|
VLCC
|
|
|
|
|
|
|
Average Spot TCE
Rate
|
$23,752
|
$36,282
|
|
$28,329
|
$40,130
|
|
Average Time Charter
TC Rate
|
-
|
-
|
|
-
|
$42,542
|
|
|
|
|
|
|
|
|
SUEZMAX
|
|
|
|
|
|
|
Average Spot TCE
Rate
|
$16,070
|
$21,095
|
|
$17,365
|
$26,839
|
|
Average Time Charter
TC Rate
|
-
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
AFRAMAX
|
|
|
|
|
|
|
Average Spot TCE
Rate
|
-$19,516
|
$14,028
|
|
$11,238
|
$18,036
|
|
Average Time Charter
TC Rate
|
-
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
PANAMAX
|
|
|
|
|
|
|
Average Spot TCE
Rate
|
$10,122
|
$7,194
|
|
$8,717
|
$13,304
|
|
Average Time Charter
TC Rate
|
-
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
FULL
FLEET
|
|
|
|
|
|
|
Average Spot TCE
Rate
|
$21,104
|
$28,190
|
|
$23,755
|
$31,551
|
|
Average Time Charter
TC Rate
|
-
|
-
|
|
-
|
$42,542
|
|
FULL FLEET TCE
Rate
|
$21,104
|
$28,190
|
|
$23,755
|
$31,745
|
|
|
(1)
|
Time Charter
Equivalent, or "TCE," is a measure of the average daily revenue
performance of a vessel. The Company calculates TCE by dividing net
voyage revenue by total operating days for its fleet. Net voyage
revenues are voyage revenues minus voyage expenses. The Company
evaluates its performance using net voyage revenues. The Company
believes that presenting voyage revenues, net of voyage expenses,
neutralizes the variability created by unique costs associated with
particular voyages or deployment of vessels on time charter or on
the spot market and presents a more accurate representation of the
revenues generated by its vessels. Please refer to the tables at
the end of this release for a reconciliation of TCE and net voyage
revenues to voyage revenues. Spot TCEs include all spot
voyages for the Company's vessels, including those that were in
Navig8 pools.
|
Fourth Quarter 2017 Results Summary
The Company recorded net loss for the three months ended
December 31, 2017 of $45.4 million, or $0.55 basic and diluted loss per share, compared
to net income of $5.8 million, or
$0.07 basic and diluted income per
share, for the prior year period.
Adjusted net loss was $18.6
million, or $0.22 basic and
diluted adjusted loss per share, for the three months ended
December 31, 2017, compared to
adjusted net income of $20.1 million,
or $0.24 basic and diluted adjusted
income per share, for the prior year period. Please refer to the
tables at the end of this press release for a reconciliation of Net
loss to Net loss, adjusted.
Adjusted EBITDA for the three months ended December 31, 2017 was $25.0 million, compared to $64.3 million for the prior year period. Please
refer to the tables at the end of this press release for a
reconciliation of adjusted net income and adjusted EBITDA to net
income.
The average daily spot TCE rate obtained by the Company's VLCC
fleet, including its vessels that were deployed in the Navig8
pools, was $23,752 for the three
months ended December 31, 2017.
During the three months ended December 31,
2017, the Company's "ECO" VLCC fleet earned an average daily
TCE rate of $24,385 and the Company's
non-"ECO" VLCC fleet earned an average daily TCE rate of
$18,907. The average daily TCE
rate obtained by the Company on a full-fleet basis was $21,104 during the three months ended
December 31, 2017, compared to
$28,190 for the prior year
period.
Net voyage revenues, which are voyage revenues minus voyage
expenses, decreased by $43.2 million, or 43.4%, to $56.4 million for the three months ended
December 31, 2017 compared to
$99.6 million for the prior year
period. The decrease in net voyage revenues was primarily due
to the decrease in the Company's average daily fleet TCE rate by
$7,086, or 25.1%, to $21,104 for the three months ended December 31, 2017 compared to $28,190 for the prior year period. The
decrease in the Company's average daily fleet TCE rate resulted in
a decrease in net voyage revenue of approximately $25.0 million during the three months ended
December 31, 2017 compared to the
prior year period. Also contributing to the decrease in net
voyage revenues was a 24.4% decrease in vessel operating days to
2,671 for the three months ended December
31, 2017 compared to 3,533 for the prior year period. The
decrease in vessel operating days resulted in a decrease in net
voyage revenue of approximately $18.2
million.
Direct vessel operating expenses, which include crew costs,
provisions, deck and engine stores, lubricating oil, insurance, and
maintenance and repairs for owned vessels decreased by $6.1 million, or 20.1%, to $24.2 million for the three months ended
December 31, 2017 compared to
$30.3 million for the prior year
period. The decrease was primarily due to the decrease in crew
costs of $3.4 million, or 22%, and
the decrease in insurance expense of $0.6
million, or 15%, compared to the prior year period. The
decrease in crew costs and insurance expense was primarily due to a
decrease in our average fleet size to 31.5 vessels for the three
months ended December 31, 2017 from
38.6 vessels for the prior year period.
General and administrative expenses increased by $3.2 million, or 57.1%, to $8.8 million for the three months ended
December 31, 2017, compared to
$5.6 million in the prior year
period. This increase was primarily due to an increase of
$1.9 million in professional and
legal fees compared to the prior year period, primarily related to
the Merger.
Depreciation and amortization decreased by $2.8 million, or 10.3%, to $23.8 million for the three months ended
December 31, 2017 compared to
$26.6 million for the prior year
period. The decrease in depreciation and amortization was primarily
due to a decrease in vessel depreciation of $1.7 million, or 6.9%, to $23.1 million for the three months ended
December 31, 2017 compared to
$24.8 million in the prior year
period.
Loss on disposal of vessels, net increased by $11.2 million, or 80.0%, to $25.2 million for the three months ended
December 31, 2017 compared to a loss
of $14.0 million for the prior year
period. The loss on disposal of vessels, net during the three
months ended December 31, 2017, was
primarily related to sales of the Gener8 Argus and Gener8
Zeus.
Net interest expense increased by $1.4
million, or 8.0%, to $19.7
million for the three months ended December 31, 2017 compared to $18.3 million for the prior year period.
The increase was primarily attributable to a decrease in
capitalization of interest expense to $0 for three months ended December 31, 2017 compared to $3.3 million for the prior year period. The
capitalized interest expense in the prior year period was
associated with vessels under construction as a result of the
funding of the acquisition of our VLCC newbuildings.
Capitalized interest results in a reduction of interest expense,
net. We do not capitalize interest expense associated with
the funding of our VLCC newbuildings after delivery of the vessels.
Partially offsetting this increase was a decrease of $1.2 million in commitment fees and an increase
of $0.4 million in interest income
due to a higher cash balance.
As of December 31, 2017, the
Company's cash balance was $200.5
million, compared to $94.7
million as of December 31,
2016. As of December 31, 2017,
the Company's total debt was $1.4
billion and net debt was $1.1
billion. Please refer to the tables at the end of this press
release for a reconciliation of net debt to total debt.
As of December 31, 2017, there
were 83,267,426 shares of the Company's common stock
outstanding.
Full Year 2017 Results Summary
The Company recorded net loss for the twelve months ended
December 31, 2017 of $168.5 million, or $2.03 basic and diluted loss per share, compared
to net income of $67.3 million, or
$0.81 basic and diluted income per
share, for the prior year period.
Adjusted net loss was $20.9
million, or $0.25 basic and
diluted adjusted loss per share, for the twelve months ended
December 31, 2017, compared to
adjusted net income of $124.8
million, or $1.51 basic and
diluted adjusted income per share, for the prior year period.
Adjusted EBITDA for the twelve months ended December 31, 2017 was $165.2 million, compared to $256.5 million for the prior year period.
The average daily spot TCE rate obtained by the Company's VLCC
fleet, including its vessels that were deployed in the Navig8
pools, was $28,329 for the twelve
months ended December 31, 2017.
During the twelve months ended December 31,
2017, the Company's "ECO" VLCC fleet earned an average daily
TCE rate of $29,094 and the Company's
non-"ECO" VLCC fleet earned an average daily TCE rate of
$23,909. The average daily TCE
rate obtained by the Company on a full-fleet basis was $23,755 during the twelve months ended
December 31, 2017, compared to
$31,745 for the prior year
period.
Net voyage revenues decreased by $93.8
million, or 23.9%, to $298.4
million for the twelve months ended December 31, 2017 compared to $392.1 million for the prior year
period. The decrease in net voyage revenues was
primarily attributable to a decrease in our average daily fleet TCE
rate by $7,990, or 25.2%, to
$23,755 for the twelve months ended
December 31, 2017, compared to
$31,745 for the prior year period
primarily due to the decrease in rates in the spot charter market.
The decrease in average daily fleet TCE rate resulted in a decrease
in net voyage revenue of approximately $98.7
million during the twelve months ended December 31, 2017 compared to the prior year
period. The decrease in net voyage revenues was partially offset by
an increase in our fleet operating days by 208 days, or 1.7% to
12,561 days for the twelve months ended December 31, 2017 compared to 12,353 days for the
prior year period due to improved utilization of our VLCC vessels
in the Navig8 pools. The increase in our vessel operating days
resulted in an increase in net voyage revenue of approximately
$4.9 million during the twelve months
ended December 31, 2017 compared to
the prior year period.
Direct vessel operating expenses was $107.4 million for the twelve months ended
December 31, 2017, or substantially
flat as compared to $107.3 million
for the prior year period. An increase in crew costs and surveys
expenses of $2.9 million for the
twelve months ended December 31, 2017
compared to the prior year period was partially offset by a
$2.8 million decrease in overall
direct vessel operating expenses for the twelve months ended
December 31, 2017 compared to the
prior year period due to the sale of 12 vessels during the twelve
months ended December 31, 2017. Daily
direct operating expenses per vessel decreased by $379, or 4.5%, to $8,079 per day, compared to $8,458 per day for the prior year period,
primarily related to an increase in our calendar days of 606 days,
or 4.8%, to 13,293 days compared to 12,687 days in the prior year
period, which was due to an increase in our average fleet size
during fiscal 2017.
General and administrative expenses increased by $6.0 million, or 21.5%, to $33.8 million for the twelve months ended
December 31, 2017 compared to
$27.8 million for the prior year
period. This increase was primarily due to an increase of
$2.1 million in professional and
legal fees, primarily related to the Merger. Also contributing to
the increase were a $1.5 million
write-off of assets, litigation loss of $0.4
million and a $1.4 million
increase in employee bonuses for the twelve months ended
December 31, 2017 compared to the
prior year period. Additionally, during fiscal 2017 we recorded
$1.3 million of compensation expenses
related the issuance of 525,000 options granted on January 5, 2017.
Depreciation and amortization increased by $16.8 million, or 19.2%, to $104.0 million for the twelve months ended
December 31, 2017 compared to
$87.2 million for the prior year
period. This increase in depreciation and amortization was
primarily due to an increase in depreciation of vessels of
$18.5 million, or 23.4%, to
$97.6 million during twelve months
ended December 31, 2017, as a result
of new vessel deliveries, compared to $79.1
million for the prior year period. The increase in
depreciation and amortization was partially offset by a decrease in
amortization of dry dock costs of $1.5
million, or 20.6%, to $5.7
million, due to sale of older vessels, compared to
$7.2 million for the prior year
period.
Losses on disposal of vessels, net increased for the twelve
months ended December 31, 2017 by
$115.7 million, or 478.6%, to
$139.8 million compared to
$24.2 million for the prior year
period, primarily due to losses on the sale of 12 vessels during
the twelve months ended December 31,
2017.
Net interest expense increased by $33.1
million, or 66.8% to $82.8 million for the twelve months ended
December 31, 2017 compared to
$49.6 million for the prior year
period. The increase was primarily attributable to the decrease in
capitalized interest of $24.4
million, or 88.5%, to $3.2
million compared to $27.6
million for the prior year period, related to the
capitalization of interest expense associated with vessels under
construction as a result of the funding of the acquisition of
our VLCC newbuildings. Also contributing to the increase in
interest expense, net during the twelve months ended December 31, 2017, was an increase in
amortization of loan fees of $3.6
million, of which $2.6 million
was related to the write-off of debt financing costs associated
with the sales of the Gener8 Noble and Gener8
Theseus.
Other income (expense), net increased by $0.3 million, or 38.5% to $0.9 million for the twelve months ended
December 31, 2017 compared to
$0.6 million for the prior year
period. During the year ended December 31,
2017 and 2016, we recognized $0.5
million and $0.7 million,
respectively of earnings, as other income (expense), net, related
to the impact of our interest rate swap agreements, entered in
fiscal 2016 and amended in 2017.
Gener8 Maritime Fleet Profile (as of March 14, 2018)
Vessels on the
Water
|
|
|
|
|
|
Type
|
Vessel
Name
|
DWT
|
Year
Built
|
Employment
|
|
|
|
|
|
|
1
|
VLCC
|
Gener8
Nestor
|
297,638
|
2017
|
VL8 Pool
|
2
|
VLCC
|
Gener8
Ethos
|
298,991
|
2017
|
VL8 Pool
|
3
|
VLCC
|
Gener8
Hector
|
297,363
|
2017
|
VL8 Pool
|
4
|
VLCC
|
Gener8
Miltiades
|
301,038
|
2016
|
VL8 Pool
|
5
|
VLCC
|
Gener8
Oceanus
|
299,011
|
2016
|
VL8 Pool
|
6
|
VLCC
|
Gener8
Perseus
|
299,392
|
2016
|
VL8 Pool
|
7
|
VLCC
|
Gener8
Macedon
|
298,991
|
2016
|
VL8 Pool
|
8
|
VLCC
|
Gener8
Chiotis
|
300,973
|
2016
|
VL8 Pool
|
9
|
VLCC
|
Gener8
Constantine
|
299,011
|
2016
|
VL8 Pool
|
10
|
VLCC
|
Gener8
Andriotis
|
301,014
|
2016
|
VL8 Pool
|
11
|
VLCC
|
Gener8
Apollo
|
301,417
|
2016
|
VL8 Pool
|
12
|
VLCC
|
Gener8
Ares
|
301,587
|
2016
|
VL8 Pool
|
13
|
VLCC
|
Gener8
Hera
|
301,619
|
2016
|
VL8 Pool
|
14
|
VLCC
|
Gener8
Nautilus
|
298,991
|
2016
|
VL8 Pool
|
15
|
VLCC
|
Gener8
Success
|
300,932
|
2016
|
VL8 Pool
|
16
|
VLCC
|
Gener8
Supreme
|
300,933
|
2016
|
VL8 Pool
|
17
|
VLCC
|
Gener8
Athena
|
299,999
|
2015
|
VL8 Pool
|
18
|
VLCC
|
Gener8
Strength
|
300,960
|
2015
|
VL8 Pool
|
19
|
VLCC
|
Gener8
Neptune
|
299,999
|
2015
|
VL8 Pool
|
20
|
VLCC
|
Gener8
Atlas
|
306,005
|
2007
|
VL8 Pool
|
21
|
VLCC
|
Gener8
Hercules
|
306,543
|
2007
|
VL8 Pool
|
22
|
Suezmax
|
Gener8
Spartiate
|
164,925
|
2011
|
Suez8 Pool
|
23
|
Suezmax
|
Gener8
Maniate
|
164,715
|
2010
|
Suez8 Pool
|
24
|
Suezmax
|
Gener8 St.
Nikolas
|
149,876
|
2008
|
Suez8 Pool
|
25
|
Suezmax
|
Gener8 Kara
G
|
150,296
|
2007
|
Suez8 Pool
|
26
|
Suezmax
|
Gener8 George
T
|
149,847
|
2007
|
Suez8 Pool
|
27
|
Suezmax
|
Gener8 Harriet
G
|
150,296
|
2006
|
Suez8 Pool
|
28
|
Aframax
|
Gener8
Defiance
|
105,538
|
2002
|
Spot
|
29
|
Panamax
|
Gener8
Companion
|
72,749
|
2004
|
Spot
|
30
|
Panamax
|
Genmar
Compatriot
|
72,749
|
2004
|
Spot
|
|
Vessels on the
Water Total
|
7,493,398
|
|
|
Financial Information
Consolidated Statements of Operations for the Three and
Twelve Months Ended December 31, 2017
and 2016
|
|
For the Three
Months
|
|
For the
Year
|
|
|
(Dollars in
thousands, except per share data)
|
Ended December
31,
|
|
Ended December
31,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
VOYAGE
REVENUES:
|
|
|
|
|
|
|
|
|
|
Navig8 pool
revenues
|
$
54,402
|
|
$
97,929
|
|
$
292,975
|
|
$
368,889
|
|
|
Time charter
revenues
|
-
|
|
-
|
|
-
|
|
9,278
|
|
|
Spot charter
revenues
|
4,430
|
|
4,432
|
|
14,844
|
|
26,455
|
|
|
Total voyage
revenues
|
58,832
|
|
102,361
|
|
307,819
|
|
404,622
|
|
|
Voyage
expenses
|
2,459
|
|
2,780
|
|
9,446
|
|
12,490
|
|
|
Net voyage
revenues
|
56,373
|
|
99,581
|
|
298,373
|
|
392,132
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
|
|
|
|
|
Direct vessel
operating expenses
|
24,170
|
|
30,267
|
|
107,395
|
|
107,308
|
|
|
Navig8 charterhire
expenses
|
-
|
|
(181)
|
|
6
|
|
3,059
|
|
|
General and
administrative
|
8,843
|
|
5,604
|
|
33,831
|
|
27,844
|
|
|
Depreciation and
amortization
|
23,824
|
|
26,569
|
|
103,951
|
|
87,191
|
|
|
Goodwill
impairment
|
-
|
|
-
|
|
-
|
|
23,297
|
|
|
Loss on disposal of
vessels, net
|
25,192
|
|
13,992
|
|
139,836
|
|
24,169
|
|
|
Goodwill write-off
for sales of vessels
|
-
|
|
-
|
|
-
|
|
2,994
|
|
|
Total operating
expenses
|
82,029
|
|
76,251
|
|
385,019
|
|
275,862
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING (LOSS)
INCOME
|
$(25,656)
|
|
$
23,330
|
|
$
(86,646)
|
|
$
116,270
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
EXPENSES:
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(19,724)
|
|
(18,272)
|
|
(82,764)
|
|
(49,627)
|
|
|
Other financing
costs
|
(4)
|
|
1
|
|
(59)
|
|
(7)
|
|
|
Other income
(expense), net
|
(8)
|
|
745
|
|
928
|
|
670
|
|
|
Total other
expenses
|
(19,736)
|
|
(17,526)
|
|
(81,895)
|
|
(48,964)
|
|
|
NET (LOSS)
INCOME
|
$(45,392)
|
|
$
5,804
|
|
$(168,541)
|
|
$
67,306
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME PER
COMMON SHARE
|
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.55)
|
|
$
0.07
|
|
$
(2.03)
|
|
$
0.81
|
|
|
Diluted
|
$
(0.55)
|
|
$
0.07
|
|
$
(2.03)
|
|
$
0.81
|
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data
|
|
December
31,
|
|
December
31,
|
BALANCE SHEET
DATA, at end of period
|
2017
|
|
2016
|
(Dollars in
thousands)
|
|
|
|
|
Cash & cash
equivalents
|
$
200,501
|
|
$
94,681
|
|
Current assets,
including cash
|
253,466
|
|
215,285
|
Total
assets
|
2,618,217
|
|
2,992,669
|
|
Current liabilities,
incl. current portion of LTD
|
151,005
|
|
216,566
|
|
Current portion of
LTD
|
120,336
|
|
181,023
|
Total LTD, incl.
current portion & excl. discount
|
1,361,826
|
|
1,581,951
|
Shareholders'
equity
|
1,274,326
|
|
1,437,411
|
Reconciliation Tables
EBITDA represents net income (loss) plus net interest expense
and depreciation and amortization. Adjusted EBITDA represents
EBITDA adjusted to exclude the items set forth in the table below,
which represent certain non-cash, one-time and other items that the
Company's believes are not indicative of the ongoing performance of
its core operations. Adjusted Net Income represents Net Income
adjusted to exclude the same non-cash, one-time and other items, as
well as commitment fees. EBITDA, Adjusted EBITDA and Adjusted Net
Income are included in this presentation because they are used by
management and certain investors as measures of operating
performance. EBITDA, Adjusted EBITDA and Adjusted Net Income are
used by analysts in the shipping industry as common performance
measures to compare results across peers. EBITDA, Adjusted EBITDA
and Adjusted Net Income are not items recognized by accounting
principles generally accepted in the
United States of America ("GAAP"), and should not be
considered in isolation or used as alternatives to net income,
operating income, cash flow from operating activity or any other
indicator of the Company's operating performance or liquidity
required by GAAP. The Company's presentation of EBITDA, Adjusted
EBITDA and Adjusted Net Income is intended to supplement investors'
understanding of its operating performance by providing information
regarding its ongoing performance that exclude items the Company
believes do not directly affect its core operations and enhancing
the comparability of its ongoing performance across periods. The
Company presents Adjusted EBITDA and Adjusted Net Income in
addition to EBITDA and Net Income because Adjusted EBITDA and
Adjusted Net Income eliminate the impact of additional non-cash,
one-time and other items not associated with the ongoing
performance of its core operations, including charges associated
with stock-based compensation, gains and losses on the sale of
vessels and costs associated with its financing activities, that
the Company believes further reduce the comparability of the
ongoing performance of its core operations across periods. The
Company's management considers EBITDA, Adjusted EBITDA and Adjusted
Net Income to be useful to investors because such performance
measures provide information regarding the profitability of its
core operations and facilitate comparison of its operating
performance to the operating performance of the Company's peers.
Additionally, the Company's management uses EBITDA, Adjusted EBITDA
and Adjusted Net Income as performance measures and they are also
presented for review at the Company's board meetings. While the
Company believes these measures are useful to investors, the
definitions of EBITDA, Adjusted EBITDA and Adjusted Net Income used
here may not be comparable to similar measures used by other
companies. In addition, these definitions are also not the same as
the definition of EBITDA, Adjusted EBITDA and Adjusted Net Income
used in the financial covenants in the Company's debt
instruments.
During the twelve months ended December
31, 2017, we included in Adjusted Net Income and Adjusted
EBITDA $1.4 million of professional
fees related to the recently announced Merger transaction and Loss
on litigation of $0.4 million, which
is related to the Atlas charter dispute. On May 9, 2017, the arbitration tribunal before
which the dispute is being heard ruled that GMR Atlas LLC (one of
our subsidiaries) had been in breach of certain customer
eligibility requirements as claimed by the Atlas claimant. As a
result, the Company recorded as general and administrative expenses
a write-off of $1.5 million during
its second quarter.
Please see below for a reconciliation of the following adjusted
amounts to Net Income (dollars in thousands)
|
Three Months
Ended
|
|
Year
Ended
|
|
Dec-17
|
|
Dec-16
|
|
Dec-17
|
|
Dec-16
|
Net (Loss)
Income
|
$(45,392)
|
|
$
5,804
|
|
$(168,541)
|
|
$
67,306
|
|
|
|
|
|
|
|
|
+ Goodwill
Impairment
|
-
|
|
-
|
|
-
|
|
23,297
|
+ Goodwill write-off
for sales of vessels
|
-
|
|
-
|
|
-
|
|
2,994
|
+ Stock-based
compensation expense
|
598
|
|
1,352
|
|
4,205
|
|
5,651
|
+ Loss on disposal of
vessels, net
|
25,192
|
|
13,992
|
|
139,836
|
|
24,169
|
+ Other financing
costs
|
4
|
|
(1)
|
|
59
|
|
7
|
+ Professional fees
related to interest rate swaps
|
-
|
|
-
|
|
260
|
|
327
|
+ Commitment
Fees
|
5
|
|
654
|
|
629
|
|
5,201
|
+ Impact of interest
rate swaps fair value
|
-
|
|
(698)
|
|
(530)
|
|
(698)
|
+ Non-cash G&A
expenses, excluding stock-based compensation
|
(379)
|
|
(1,025)
|
|
1,413
|
|
(3,414)
|
+ Loss on
litigation
|
-
|
|
-
|
|
400
|
|
-
|
+ Merger related
costs
|
1,404
|
|
-
|
|
1,404
|
|
-
|
Net (Loss) Income,
adjusted
|
$(18,568)
|
|
$
20,078
|
|
$
(20,865)
|
|
$
124,840
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, basic, in thousands
|
83,083
|
|
82,776
|
|
83,003
|
|
82,075
|
Weighted average
shares outstanding, diluted, in thousands
|
83,083
|
|
82,776
|
|
83,003
|
|
82,075
|
|
|
|
|
|
|
|
|
Basic net (loss)
income per share, adjusted
|
$
(0.22)
|
|
$
0.24
|
|
$
(0.25)
|
|
$
1.51
|
Diluted net (loss)
income per share, adjusted
|
$
(0.22)
|
|
$
0.24
|
|
$
(0.25)
|
|
$
1.51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
Dec-17
|
|
Dec-16
|
|
Dec-17
|
|
Dec-16
|
Net (Loss)
Income
|
$
(45,392)
|
|
$
5,804
|
|
$
(168,541)
|
|
$
67,306
|
+ Interest expense,
net
|
19,724
|
|
18,272
|
|
82,764
|
|
49,627
|
+ Depreciation and
amortization
|
23,824
|
|
26,569
|
|
103,951
|
|
87,191
|
EBITDA
|
$
(1,844)
|
|
$
50,645
|
|
$
18,174
|
|
$
204,124
|
|
|
|
|
|
|
|
|
+ Goodwill
Impairment
|
-
|
|
-
|
|
-
|
|
23,297
|
+ Goodwill write-off
for sales of vessels
|
-
|
|
-
|
|
-
|
|
2,994
|
+ Stock-based
compensation expense
|
598
|
|
1,352
|
|
4,205
|
|
5,651
|
+ Loss on disposal of
vessels, net
|
25,192
|
|
13,992
|
|
139,836
|
|
24,169
|
+ Other financing
costs
|
4
|
|
(1)
|
|
59
|
|
7
|
+ Professional fees
related to interest rate swaps
|
-
|
|
-
|
|
260
|
|
327
|
+ Impact of interest
rate swaps fair value
|
-
|
|
(698)
|
|
(530)
|
|
(698)
|
+ Non-cash G&A
expenses, excluding stock-based compensation
|
(379)
|
|
(1,025)
|
|
1,413
|
|
(3,414)
|
+ Loss on
litigation
|
-
|
|
-
|
|
400
|
|
-
|
+ Merger related
costs
|
1,404
|
|
-
|
|
1,404
|
|
-
|
EBITDA,
adjusted
|
$
24,975
|
|
$
64,265
|
|
$
165,221
|
|
$
256,457
|
|
|
(1)
|
Non-cash G&A
expenses, excluding stock-based compensation expense, include
accounts receivable reserves, amortization of lease assets that
were recorded in connection with fresh start accounting and
amortization of straight line rent expense. The presentation of
prior year amounts have been conformed to the current year
presentation.
|
Net debt represents total debt less cash, discounts and deferred
financing costs. Net debt is included is this presentation
because it is used by management and certain investors as a measure
of the Company's overall liquidity, financial flexibility and
leverage. Furthermore, certain investors, creditors, and credit
analysts monitor the Company's net debt as part of their
assessments of its business. Net debt is not recognized by
GAAP, and should not be considered in isolation or used as
alternatives financial condition or liquidity required by GAAP. In
particular, the Company typically needs a portion of its cash for
purposes other than debt reduction. The deduction of these items
from total debt in the calculation of net debt should thus not be
understood to mean that any of these items are available
exclusively for debt reduction at any given time.
Long-term debt reconciliation table
Please see below
for a reconciliation of the following adjusted amounts to long-term
debt (dollars in thousands)
Reconciliation of
total long-term debt
|
December
31,
|
|
December
31,
|
2017
|
|
2016
|
|
Long-term debt less
unamortized discount and debt financing costs
|
$
1,191,711
|
|
$
1,337,782
|
|
Current portion of
long-term debt
|
120,336
|
|
181,023
|
Total long-term
debt, incl. current portion, less unamortized discount and
DFC
|
$
1,312,047
|
|
$
1,518,805
|
|
Cash & cash
equivalents
|
200,501
|
|
94,681
|
Net
Debt
|
$
1,111,546
|
|
$
1,424,124
|
Net Voyage Revenue & Operating Days Reconciliation
Tables
Gener8 Maritime
Net Voyage Revenue & Operating Days
|
|
(Dollars in
thousands, except Operating Days data)
|
Three Months
Ended
|
|
Year
Ended
|
|
|
Dec-17
|
Dec-16
|
|
Dec-17
|
Dec-16
|
|
VLCC
|
|
|
|
|
|
|
ECO Fleet Net Voyage
Revenue (1)
|
$
42,367
|
$
57,325
|
|
$
204,307
|
$
163,935
|
|
ECO Fleet Operating
Days (1)
|
1,737
|
1,532
|
|
7,022
|
4,067
|
|
Non-ECO Fleet Net
Voyage Revenue (1)
|
$
4,297
|
$
14,763
|
|
$
29,092
|
$
78,886
|
|
Non-ECO Fleet
Operating Days (1)
|
227
|
455
|
|
1,217
|
1,984
|
|
Spot Charter &
Navig8 Pool Net Voyage Revenues
|
$
46,664
|
$
72,088
|
|
$
233,399
|
$
242,821
|
|
Spot Charter &
Navig8 Pool Operating Days
|
1,965
|
1,987
|
|
8,239
|
6,051
|
|
|
|
|
|
|
|
|
Time Charter
Revenue
|
$
-
|
$
-
|
|
$
-
|
$
9,278
|
|
Time Charter
Operating Days
|
-
|
-
|
|
-
|
218
|
|
|
|
|
|
|
|
|
SUEZMAX
|
|
|
|
|
|
|
Spot Charter &
Navig8 Pool Net Voyage Revenues
|
$
8,149
|
$
21,030
|
|
$
50,324
|
$
104,516
|
|
Spot Charter &
Navig8 Pool Operating Days
|
507
|
997
|
|
2,898
|
3,894
|
|
|
|
|
|
|
|
|
Time Charter
Revenue
|
$
-
|
$
-
|
|
$
-
|
$
-
|
|
Time Charter
Operating Days
|
-
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
AFRAMAX
|
|
|
|
|
|
|
Spot Charter &
Navig8 Pool Net Voyage Revenues
|
$
(302)
|
$
5,163
|
|
$
9,264
|
$
25,730
|
|
Spot Charter &
Navig8 Pool Operating Days
|
15
|
368
|
|
824
|
1,427
|
|
|
|
|
|
|
|
|
PANAMAX
|
|
|
|
|
|
|
Spot Charter
Revenue
|
$
1,863
|
$
1,300
|
|
$
5,225
|
$
9,595
|
|
Spot Operating
Days
|
184
|
181
|
|
599
|
721
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gener8 Maritime
Full Fleet Net Voyage Revenues
|
|
|
|
|
|
(Dollars in
thousands)
|
Three Months
Ended
|
|
Year
Ended
|
|
|
Dec-17
|
Dec-16
|
|
Dec-17
|
Dec-16
|
|
Total Voyage
Revenues
|
$
58,832
|
$
102,361
|
|
$
307,819
|
$
404,622
|
|
Total Voyage
Expenses
|
2,459
|
2,780
|
|
9,446
|
12,490
|
|
Total Net Voyage
Revenues
|
$
56,373
|
$
99,581
|
|
$
298,373
|
$
392,132
|
|
|
(1)
|
Includes all spot
voyages for the Company's vessels, including those that were in the
Navig8 Pools.
|
About Gener8 Maritime
As of March 14, 2018, Gener8 Maritime has a fleet of 30
wholly-owned vessels comprised of 21 VLCCs, 6 Suezmaxes, one
Aframax, and two Panamax tankers. Gener8 Maritime's fleet has
a total carrying capacity of approximately 7.5 million deadweight
tons ("DWT") and an average age of approximately 3.2 years on a DWT
basis. Gener8 Maritime is incorporated under the laws of the
Marshall Islands and headquartered
in New York.
Website Information
The Company intends to use its
website, www.gener8maritime.com, as a means of disclosing material
non-public information and for complying with its disclosure
obligations under Regulation FD. Such disclosures will be included
in its website's Investor Relations section. Accordingly, investors
should monitor the Investor Relations portion of the Company's
website, in addition to following its press releases, filings with
the Securities and Exchange Commission (the "SEC"), public
conference calls, and webcasts. To subscribe to the Company's
e-mail alert service, please click the "Investor Alerts" link in
the Investors section of the Company's website and submit your
email address. The information contained in, or that may be
accessed through, the Company's website is not incorporated by
reference into or a part of this document or any other report or
document the Company files with or furnish to the SEC, and any
references to the Company's website are intended to be inactive
textual references only.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995
This press release contains
forward-looking statements, made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are not historical facts and are
based on management's current beliefs, expectations, estimates and
projections about future events, many of which, by their nature,
are inherently uncertain and beyond the Company's control. Included
among the factors that, in the Company's view, could cause actual
results to differ materially from the forward looking statements
contained in this press release are the following: (i) loss or
reduction in business from the significant customers of the
Company's or of the commercial pools in which the Company
participates; (ii) changes in the values of the Company's vessels,
newbuildings or other assets; (iii) the failure of the Company's
significant customers, shipyards, pool managers or technical
managers to perform their obligations owed to the Company; (iv) the
loss or material downtime of significant vendors and service
providers; (v) the Company's failure, or the failure of the
commercial managers of any pools in which the Company's vessels
participate, to successfully implement a profitable chartering
strategy; (vi) termination or change in the nature of the Company's
relationship with any of the commercial pools in which it
participates; (vii) changes in demand for the Company's services;
(viii) a material decline or prolonged weakness in rates in the
tanker market; (ix) changes in production of or demand for oil
and petroleum products, generally or in particular regions;
(x) greater than anticipated levels of tanker newbuilding
orders or lower than anticipated rates of tanker scrapping; (xi)
adverse weather and natural disasters, acts of piracy, terrorist
attacks and international hostilities and instability; (xii)
changes in rules and regulations applicable to the tanker industry,
including, without limitation, legislation adopted by international
organizations such as the International Maritime Organization and
the European Union or by individual countries; (xiii) actions taken
by regulatory authorities; (xiv) actions by the courts, the U.S.
Coast Guard, the U.S. Department of Justice or other governmental
authorities and the results of the legal proceedings to which the
Company or any of its vessels may be subject; (xv) changes in
trading patterns significantly impacting overall tanker tonnage
requirements; (xvi) any non-compliance with the U.S. Foreign
Corrupt Practices Act of 1977 or other applicable regulations
relating to bribery; (xvii) the highly cyclical nature of the
oil-shipping industry; (xviii) changes in the typical seasonal
variations in tanker charter rates; (xix) changes in the cost of
other modes of oil transportation; (xx) changes in oil
transportation technology; (xxi) increases in costs including
without limitation: crew wages, insurance, provisions, repairs and
maintenance; (xxii) changes in general political conditions;
(xxiii) the adequacy of insurance to cover the Company's losses,
including in connection with maritime accidents or spill events;
(xxiv) changes in the condition of the Company's vessels or
applicable maintenance or regulatory standards (which may affect,
among other things, the Company's anticipated drydocking or
maintenance and repair costs); (xxv) changes in the itineraries of
the Company's vessels; (xxvi) adverse changes in foreign currency
exchange rates affecting the Company's expenses; (xxvii) the
fulfillment of the closing conditions under, or the execution of
customary additional documentation for, the Company's agreements to
acquire or sell vessels and borrow under its existing financing
arrangements; (xxviii) the effect of the Company's indebtedness on
its ability to finance operations, pursue desirable business
operations and successfully run its business in the future; (xxix)
financial market conditions; (xxx) sourcing, completion and funding
of financing on acceptable terms; (xxxi) the Company's ability to
generate sufficient cash to service its indebtedness and comply
with the covenants and conditions under the Company's debt
obligations; (xxxii) the impact of electing to take advantage of
certain exemptions applicable to emerging growth companies; and
(xxxiii) the possibility that the Merger does not close when
expected or at all because required shareholder approval is not
received or other conditions to the closing are not satisfied on a
timely basis or at all; (xxxiv) that Gener8 and Euronav NV may be
required to modify the terms and conditions of the Merger Agreement
to achieve shareholder approval, or that the anticipated benefits
of the Merger are not realized as a result of such things as the
weakness of the economy and competitive factors in the seaborne
transportation area in which Euronav NV and Gener8 do business;
(xxxvi) the Merger's effect on the relationships of Euronav NV or
Gener8 with their respective customers and suppliers, whether or
not the Merger is completed;(xxxvii) Gener8's shareholders'
reduction in their percentage ownership and voting power; (xxxviii)
the parties' ability to successfully integrate operations in the
proposed merger;(xxxix) the uncertainty of third-party approvals;
(xxx) the significant transaction and merger-related integration
costs and (xl) other factors listed from time to time in the
Company's filings with SEC, including, without limitation, the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2016 and its subsequent reports on Form 10-Q and
Form 8-K. Accordingly the reader is cautioned not to place undue
reliance on forward-looking statements, which speak only as of the
date on which they are made. The Company does not undertake any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or
otherwise.
Important Information for Investors and Shareholders
In connection with the proposed transaction between Euronav NV and
the Company, Euronav NV and the Company intend to file relevant
materials with the SEC, including a Euronav NV registration
statement on Form F-4 filed on February 14,
2018 that includes a preliminary proxy statement of the
Company that also constitutes a preliminary prospectus of Euronav
NV. The definitive proxy statement/prospectus will be delivered to
shareholders of the Company. INVESTORS AND SECURITY HOLDERS OF THE
COMPANY ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY
OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY
AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT EURONAV NV, THE COMPANY AND THE
PROPOSED TRANSACTION. Investors and security holders will be able
to obtain free copies of the registration statement and the
definitive proxy statement/prospectus (when available) and other
documents filed with the SEC by Euronav NV and the Company through
the website maintained by the SEC at http://www.sec.gov. Copies of
the documents filed with the SEC by Euronav NV (when available)
will be available free of charge on Euronav NV's internet website
at www.euronav.com. Copies of the documents filed with the SEC by
the Company (when available) will be available free of charge on
Baltic Trading's internet website at www.gener8maritime.com.
Participants in the Merger Solicitation
This
communication is not a solicitation of a proxy from any investor or
securityholder. However, the Company, its directors and certain of
their executive officers and employees may be deemed to be
participants in the solicitation of proxies in connection with the
proposed transaction under the rules of the SEC. In addition, the
Company intends to retain D.F. King & Co., Inc. to solicit
proxies in connection with the proposed transaction. Information
regarding the persons who may, under the rules of the SEC, be
deemed participants in the solicitation of the Company's
shareholders in connection with the proposed transaction and a
description of their direct and indirect interests, by security
holdings or otherwise, is set forth in the preliminary proxy
statement/prospectus. Information about the directors and executive
officers of the Company is set forth in the preliminary proxy
statement/prospectus and the Company's definitive proxy statement
filed with the SEC on April 6, 2017.
These documents are available free of charge from the sources
indicated above.
Non-Solicitation
This communication does not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities or a solicitation of any vote or approval, nor
shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
View original
content:http://www.prnewswire.com/news-releases/gener8-maritime-inc-announces-fourth-quarter-2017-financial-results-300614119.html
SOURCE Gener8 Maritime, Inc.