Genco Shipping & Trading Limited Q1 2017 Earnings Call May 9 th , 2017
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as “anticipate,” “budget,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of potential future events, circumstances or future operating or financial performance. These forward looking statements are based on management’s current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: (i) further declines or sustained weakness in demand in the drybulk shipping industry; (ii) continuation of weakness or further declines in drybulk shipping rates; (iii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iv) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (v) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (vi) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, lube, oil, bunkers, repairs, maintenance and general, administrative, and management fee expenses; (vii) whether our insurance arrangements are adequate; (viii) changes in general domestic and international political conditions; (ix) acts of war, terrorism, or piracy; (x) changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (xi) the Company’s acquisition or disposition of vessels; (xii) the amount of offhire time needed to complete repairs on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims, including offhire days; (xiii) the completion of definitive documentation with respect to charters; (xiv) charterers’ compliance with the terms of their charters in the current market environment; (xv) the extent to which our operating results continue to be affected by weakness in market conditions and charter rates; (xvi) our ability to maintain contracts that are critical to our operation, to obtain and maintain acceptable terms with our vendors, customers and service providers and to retain key executives, managers and employees; and other factors listed from time to time in our public filings with the Securities and Exchange Commission including, without limitation, the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and its subsequent reports on Form 10-Q and Form 8-K. Our ability to pay dividends in any period will depend upon various factors, including the limitations under any credit agreements to which we may be a party, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. 2
Agenda � First Quarter 2017 and Year to Date Highlights � Financial Overview � Industry Overview 3
First Quarter 2017 and Year to Date Highlights
First Quarter 2017 and Year to Date Highlights � Increased cash position to $173.9 million as of March 31, 2017 Net loss of $15.6 million for the first quarter of 2017 � ― Basic and diluted loss per share of $0.47 Adjusted basic and diluted loss of $22.0 million or $0.66 per share, excluding $6.4 million for gain on sale of vessels (1) ― Took further steps during the first quarter of 2017 towards completing our vessel sales program � ― Four vessels were sold during the quarter achieving net proceeds of $12.7 million • Net proceeds were recorded as cash on the balance sheet ― Expect to complete the vessel sales program with the sale of the Genco Prosperity • Anticipate the vessel to be delivered to buyers by May 20, 2017, and net proceeds of $2.9 million to be recorded as cash on the balance sheet ― Sales of the older vessels continue to reduce the average age of our fleet Completed the conversion of $125 million of Series A Preferred Stock to common stock on January 4, 2017 � (1) We believe the non-GAAP measure presented provides investors with a means of better evaluating and understanding the Company’s operating performance. 5
Genco’s Leading Market Position Genco has significantly improved its leading market position focusing on enhancing its commercial strategy and leading low-cost operations Strong Balance Sheet & Straight Forward Capital Structure Strong Liquidity Position Diversified Fleet $174 Million at Mar 31 Genco Shipping Strategic Chartering Growth Potential Focus & Trading Limited Continuous Cost Transparent Operations Savings Since 2014 No Newbuilding Capex Obligations 6
Strategic Plan Implemented � Management has significantly enhanced Genco’s commercial and operating platform through the execution of the following initiatives � Concentration on full in-house commercial platform: withdrawing certain Supramax and Handysize vessels from pools Commercial Commercial � Continue to augment commercial platform: added Vice President and Commercial Director, Minor Bulk Fleet � Fleet deployment mix weighted towards short-term fixtures: provides optionality in a rising freight rate environment Strategy Strategy Diversifying and expanding the customer base: added 10 new customers in Q1 enabling Genco to get closer to cargo � Capesize exposure positioned for market recovery � ― Staggering expiration dates of charters Major Bulk Major Bulk ― Most recent Capesize fixture: Baltic Wolf: $15,350 per day ― Projected ton-mile demand growth highly driven by iron ore and coal � Diversifying and reallocating freight exposure through a more balanced Atlantic vs. Pacific split Result being reduction of ballast legs and higher fleet utilization through concentrated customer geographic focus ― Minor Bulk Minor Bulk Recent short-term Atlantic fixtures include: ― • Supramax: Genco Rhone: $15,000, Genco Aquitaine: $16,000 per day, Genco Predator: $13,500 • Handysize: Genco Spirit: $9,250, Baltic Wind: $9,000, Genco Ocean: $8,600, Baltic Breeze: $8,000, Genco Bay: $8,000 � All Genco vessels currently have a high commercial Rightship rating of 4-stars ― Provides maximum business flexibility for our cargo customers Operating & Operating & Consistently reduced costs since 2014 without sacrificing our high safety and maintenance standards � Technical Technical Continue to implement crew optimization cost saving measures � Performance Performance Additional cost saving measures are expected to be implemented throughout 2017 � � Dedicated resources towards speed and consumption optimization Genco’s Daily Vessel Operating Expenses Atlantic vs. Pacific Exposure: Minor Bulk Fleet* 100% $5,200 87% Atlantic Pacific $5,000 80% $4,800 52% 60% 48% DVOE $4,600 $5,035 40% $4,870 $4,400 13% $4,514 20% $4,200 $4,395 $4,000 0% Nov-16 Current 2014 2015 2016 Q1 2017 7 * Includes Ultramaxes, in-house managed Supramax and Handysize vessels.
Recommend
More recommend
