Pioneer Marine Inc. Announces Third Quarter 2016 Results
(firmenpresse) - MAJURO, MARSHALL ISLANDS -- (Marketwired) -- 11/15/16 -- Pioneer Marine Inc. and its subsidiaries (OSLO-OTC: PNRM) ("Pioneer Marine," or the "Company"), a leading shipowner and global drybulk transportation service provider, announced its financial and operating results for the third quarter ended September 30, 2016.
For the third quarter of 2016 the Company reported a net loss of $2.8 million, or $0.10 per share basic and diluted.
For the nine-month period ended September 30, 2016, the Company reported a net loss of $23.5 million, or $0.78 per share basic and diluted which includes charges and write off of capitalised expenses amounting to $11.6 million as a result of the termination of seven newbuilding contracts ("newbuilding contract termination agreement"). Excluding these charges, the net loss is $11.8 million or $0.39 per share basic and diluted for the nine-month period ended September 30, 2016.
On October 11, 2016, the Company took delivery of M/V Resolute Bay, a 36,767 dwt 2012 built Handysize vessel. The purchase was financed through available cash from the balance sheet.
On October 18, 2016, the Company took delivery of M/V Tenacity Bay, a 56,842 dwt 2008 built Supramax vessel. The purchase was partially financed through a new loan facility.
Following the above deliveries Pioneer fleet consists of 15 Handysize vessels, one Handymax vessel and one Supramax vessel.
As of September 30, 2016, the Company had a total liquidity of $90.7 million inclusive of $19.7 million in restricted cash.
On October 17, 2016, the Company entered into a secured loan agreement amounting to $4.75 million to partially finance the acquisition of M/V Tenacity Bay.
Following the delivery of vessels described above, the Company has no capital commitments.
Pankaj Khanna, Chief Executive Officer, commented, "Freight markets continued to recover from the record lows seen in the first quarter this year but 2016 will go down in the record books as the worst year for drybulk in over 30 years. The recovery in the market has been slow and being led by strong demand growth with substantial gains across the board for iron ore, coal and minor bulks including grain. Chinese imports have surprised on the upside with iron ore imports up 9% in the first nine months and coal up 15% compared to the same period last year. The US and European grain season has kicked off and exports from the US, Russia and Ukraine have been strong and are reflected in an improved market for geared vessels.
"On the supply side though there are concerns as scrapping has slowed dramatically compared to the levels seen in the first half of the year. However, with the approval of the Ballast Water Management System regulations by the IMO, older vessels will be forced to either bring forward drydocks or install expensive ballast water treatment plants, either way an expensive option for some companies that may already be running out of cash. There is also the latest IMO regulation on sulphur reduction that will also hasten the scrapping of older, less efficient vessels. This is especially so in the Handysize segment as these vessels do not have enough space to install the required scrubbers to keep using cheaper high sulphur fuels.
"Post the cancellation of our 10 newbuildings the Company is well positioned with a large cash reserve that we are judiciously deploying for attractive deals. We acquired two vessels in the last month that were both from special situations at an attractive price and one with favourable debt terms. We continue to see more of such deals and will move cautiously to take advantage when some of these fit in with our strategy."
Time Charter Equivalent ("TCE") revenue amounted to $7.9 million in the third quarter of 2016 compared to $6.9 million for the third quarter of 2015. TCE per day for the third quarter of 2016 amounted to $5,763 as compared to $6,219 for the third quarter of 2015. The decrease of the TCE per day is due to the weaker market prevailing in the third quarter of 2016 as compared to the third quarter of 2015.
Vessel Operating Expenses ("OPEX") amounted to $6.2 million for the third quarter of 2016 as compared to $6.0 million in the third quarter of 2015. OPEX per day for the third quarter of 2016 amounted to $4,500, as compared to $4,843 for the third quarter of 2015. The decrease in daily OPEX rate is due to operating efficiencies achieved from cost reduction measures.
Depreciation expense for the third quarter of 2016 decreased to $2.0 million from $2.8 million in the third quarter of 2015, due to the reduced depreciated vessel values which resulted from the impairment charge taken at December 31, 2015.
General and administration expenses for the third quarter of 2016 decreased to $1.2 million as compared to $1.4 million in the third quarter of 2015. G&A expenses per day for the third quarter in 2016 amounted to $873 per ship as compared to $1,133 per ship for the third quarter of 2015. The decrease of G&A expenses is attributed to cost reduction measures.
Time Charter Equivalent ("TCE") revenue amounted to $19.6 million for the nine months ended September 30, 2016 compared to $19.7 million in the same prior year period. TCE per day for the first nine months of 2016 amounted to $4,830, as compared to $5,899 in the same prior year period. The decrease of the TCE per day is due to the weaker market prevailing in the nine months ended September 30, 2016 as compared to same period in 2015.
Vessel Operating Expenses ("OPEX") amounted to $18.4 million for the nine months ended September 30, 2016, compared to $18.2 million into the same prior year. OPEX per day for the first nine months of 2016 amounted to $4,481 as compared to $5,076 for the respective period in 2015. The decrease in daily OPEX is attributable to operating efficiencies achieved from cost reduction measures.
Depreciation expense for the nine-month period ended September 30, 2016 decreased to $5.9 million as compared to $8.2 million during the same period in 2015. The decrease is attributable to the reduced depreciated vessel values, which resulted from the impairment charge taken at December 31, 2015.
General and administration expenses for the nine-month period ended September 30, 2016 decreased to $3.5 million from $4.2 million during the same period in 2015. G&A expenses per day for the first nine months in 2016 amounted to $858 per ship as compared to $1,170 per ship for the same period in 2015. The decrease of G&A expenses is attributable to cost reduction measures.
Write off of capitalised expenses and fees amounting to $11.6 million during the nine months ended September 30, 2016 is due to the newbuilding contract termination agreement. The amount consists of capitalised expenses during the construction period, cancellation costs net of interest for the instalments paid and deferred finance and loan fees attributable to the post-delivery financing of these newbuildings.
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About Pioneer Marine Inc.
Pioneer Marine is a leading ship owner and global drybulk transportation service provider. Pioneer Marine currently owns fifteen Handysize, one Handymax and one Supramax drybulk carriers.
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, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe 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 our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.
In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the failure of counterparties to fully perform their contracts with us, the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for dry bulk vessel capacity, changes in our operating expenses, including bunker prices, drydock and insurance costs, the market for our vessels, availability of financing and refinancing, charter counterparty performance, ability to obtain financing and comply with covenants in such financing arrangements, 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.
Pioneer Marine Inc.
Pankaj Khanna
President and CEO
+65 6513 8761
Capital Link, Inc.
Paul Lampoutis
+212 661 7566
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Datum: 15.11.2016 - 17:20 Uhr
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