Achieves Record Earnings
Secures $825 Million Bank Facility
Integrates Two of the Soponata Vessels
NEW YORK, April 28 /PRNewswire-FirstCall/ -- General Maritime Corporation
(NYSE: GMR) today reported its financial results for the three months ended
March 31, 2004.
Financial Review: 2004 First Quarter
The Company had net income of $78.3 million, or $2.12 basic and $2.08
diluted earnings per share, for the three months ended March 31, 2004 compared
to net income of $34.4 million, or $0.93 basic and $0.92 diluted earnings per
share, for the three months ended March 31, 2003. The increase in net income
was the result of stronger spot charter rates during the first quarter
relative to the first quarter of 2003, and the increase in the number of
vessels in our fleet from the prior year period.
Peter C. Georgiopoulos, Chairman, Chief Executive Officer and President,
commented, "During the first quarter, General Maritime continued to achieve
impressive results, having posted our fifth consecutive quarter of record
earnings. Our ability to earn over $78 million so early in the year provides
the Company with an excellent platform upon which to build for the remainder
of 2004. Our acquisition of the Soponata Group's vessels and technical
management company further enhances General Maritime's commercial and
financial opportunities, as we have once again expanded our quality fleet and
solidified our leadership position in the mid-sized tanker industry. As of
late April we have already integrated two of the new vessels and have deployed
them in a strong market. We expect to take delivery of three additional
tankers by mid-May and will focus on seamlessly integrating the vessels into
our operations as we have done in the past."
Net voyage revenue, which is gross voyage revenues minus voyage expenses
unique to a specific voyage (including port, canal and fuel costs), increased
110.4% to $146.7 million for the three months ended March 31, 2004 compared to
$69.7 million for the three months ended March 31, 2003. EBITDA for the three
months ended March 31, 2004 was $113.7 million compared to $52.9 million for
the three months ended March 31, 2003. Net cash provided by operating
activities was $91.3 million for the three months ended March 31, 2004
compared to $43.0 million for the prior year period (please see below for a
reconciliation of EBITDA to net cash provided by operating activities). As of
March 31, 2004 the Company's net debt to book capitalization (calculated as
net debt divided by net debt plus shareholders equity) stood at 45% compared
to 52% as of December 31, 2003.
The average daily time charter equivalent, or TCE, rates obtained by the
Company's full fleet increased by 41.2% to $38,847 per day for the three
months ended March 31, 2004 from $27,512 for the prior year period. The
Company's average rates for vessels on spot charters increased by 66.1% to
$47,310 for the three months ended March 31, 2004 compared to $28,479 for the
prior year period.
Total vessel operating expenses, which are direct vessel operating
expenses and general and administrative expenses, increased 85.3% to
$33.0 million for the three months ended March 31, 2004 from $17.8 million for
the three months ended March 31, 2003. During the same periods, the average
size of General Maritime's fleet increased 47.7% to 42.4 vessels from 28.7
vessels due to the acquisition of 19 tankers and sale of five tankers since
the prior year period. Total daily vessel operating expenses increased 25% to
$8,566 per vessel day during the first quarter of 2004 from $6,851 per vessel
day during the same period in 2003. Daily direct vessel operating expenses
grew due to the increased percentage of Suezmax vessels in the Company's
fleet, the costs associated with re-flagging and re-crewing certain of our
vessels as well as the timing of certain purchases associated with maintenance
and repairs, and the decline in the dollar against the Euro which made Euro
denominated costs in 2004 more expensive.
Mr. Georgiopoulos added, "Building on our track record of de-leveraging
the Company following an acquisition, we utilized our strong cash flow to
significantly reduce our debt as promised. Our success at preserving the
Company's financial strength and flexibility enabled General Maritime to seize
the opportunity to further consolidate the industry and acquire the assets of
the Soponata Group. We remain committed to ensuring that General Maritime's
capital structure remains strong."
Summary Consolidated Financial and Other Data
The following table summarizes General Maritime Corporation's selected
consolidated financial and other data for the three months ended March 31,
2004 and 2003. Attached to this press release is an Appendix, which contains
additional financial, operational and other data for the three months ended
March 31, 2004 and 2003.
Three months ended
March-04 March-03
INCOME STATEMENT DATA
(Dollars in thousands, except share data)
Voyage revenues $ 171,588 $ 91,493
Voyage expenses (24,883) (21,750)
Net voyage revenues 146,705 69,743
Direct vessel expenses 26,513 14,207
General and administrative expenses 6,510 3,615
Depreciation and amortization 25,701 14,568
Gain on sale of vessel - (930)
Operating income 87,981 38,283
Net interest expense 9,707 3,904
Net Income $ 78,274 $ 34,379
Basic earnings per share: $ 2.12 $ 0.93
Fully diluted earnings per share: $ 2.08 $ 0.92
Weighted average shares outstanding, thousands 36,991 36,965
Diluted average shares outstanding, thousands 37,672 37,216
March-04 December-03
BALANCE SHEET DATA, at end of period
(Dollars in thousands)
Cash $ 71,464 $ 38,905
Current assets, including cash 130,315 102,473
Total assets 1,287,054 1,263,578
Current liabilities, including current
portion of long-term debt 85,780 89,771
Current portion of long-term debt 61,369 59,553
Total long-term debt,
including current portion 607,395 655,670
Shareholders' equity 647,672 568,880
Three months ended
March-04 March-03
OTHER FINANCIAL DATA
(dollars in thousands)
EBITDA (1) $113,682 $ 52,851
Net cash provided by operating activities 91,291 43,017
Net cash provided (used) by
investing activities (10,244) (158,039)
Net cash provided (used) by
financing activities (48,488) 215,630
Capital expenditures
Vessel sales (purchases),
including deposits, Net (9,669) (157,803)
Drydocking or capitalized survey
or improvement costs (518) (126)
Weighted average long-term debt 627,993 347,759
FLEET DATA
Total number of vessels at end of period 42 32
Average number of vessels (2) 42.4 28.7
Total voyage days for fleet (3) 3,777 2,535
Total time charter days for fleet 1,233 365
Total spot market days for fleet 2,544 2,170
Total calendar days for fleet (4) 3,855 2,581
Fleet utilization (5) 98.0% 98.2%
AVERAGE DAILY RESULTS
Time Charter equivalent (6) $ 38,847 $ 27,512
Direct vessel operating expenses per vessel (7) 6,878 5,505
General and administrative expense
per vessel (8) 1,689 1,346
Total vessel operating expenses (9) 8,566 6,851
EBITDA (10) 29,489 20,477
Three months ended
March-04 March-03
EBITDA Reconciliation
Net cash provided by operating activites $ 91,291 $ 43,017
+ Gain on sale of vessel - 930
- Other reconciling adjustments 416 142
+ Changes in assets and liabilities 13,100 5,142
+ Net interest expense 9,707 3,904
EBITDA 113,682 52,851
(1) EBITDA represents net cash provided by operating activities plus net
interest expense, adjusted for: (a) certain noncash adjustments to net
income such as gains and losses on sales of assets and amortization of
restricted stock awards and (b) changes in certain assets and
liabilities. EBITDA is included because it is used by certain
investors. EBITDA is not an item recognized by GAAP, and should not be
considered as an alternative to net cash provided by operating
activities or any other indicator of a company's performance required
by GAAP.
(2) Average number of vessels is the number of vessels that constituted
our fleet for the relevant period, as a measured by the sum of the
number of days each vessels was part of our fleet during the period
divided by the number of calendar days in that period.
(3) Voyage days for fleet are the total days our vessels were in our
possession for the relevant period net of off hire days associated
with major repairs, drydockings or special or intermediate surveys.
(4) Calendar days are the total days the vessels were in our possession
for the relevant period including off hire days associated with major
repairs, drydockings or special or intermediate surveys.
(5) Fleet utilization is the percentage of time that our vessels were
available for revenue generating voyage days, and is determined by
dividing voyage days by calendar days for the relevant period.
(6) Time Charter Equivalent, or TCE, is a measure of the average daily
revenue performance of a vessel on a per voyage basis. Our method of
calculating TCE is consistent with industry standards and is
determined by dividing net voyage revenue by voyage days.
(7) Daily direct vessel operating expenses, or DVOE, is calculated by
dividing DVOE, which includes crew costs, provisions, deck and engine
stores, lubricating oil, insurance and maintenance and repairs, by
calendar days for the relevant time period.
(8) Daily general and administrative expense is calculated by dividing
general and administrative expenses by vessel calendar days.
(9) Total Vessel Operating Expenses, or TVOE, is a measurement of our
total expenses associated with operating our vessels. Daily TVOE is
the sum of daily direct vessel operating expenses, or DVOE, and daily
general and administrative expenses.
(10)Daily EBITDA is total EBITDA divided by total vessel calander days.
General Maritime Corporation's Fleet
As of April 26, 2004, General Maritime Corporation's fleet was comprised
of 44 wholly owned tankers, consisting of 24 Aframax and 20 Suezmax tankers,
with a total carrying capacity of approximately 5.3 million deadweight tons,
or dwt. The average age of the Company's fleet as of March 31, 2004 by dwt
was 11.9 years compared to 12.2 years as of March 31, 2003. The average age of
the Company's Aframax tankers was 12.6 years and the average age of the
Company's Suezmax tankers was 11.0 years.
Currently 14 of General Maritime Corporation's Aframax tankers and 19 of
its Suezmax tankers are operating on the spot market. 25% of the Company's
fleet, 10 Aframax tankers and one of the Company's Suezmax tankers are
currently under time charter contracts, compared to 21% under time charter
contract as of March 31, 2003.
2004
Vessel Vessel Type Expiration Average
Date Daily Rate (1)
1.00 Genmar Pericles (2) Aframax October 2, 2004 $19,700
2.00 Genmar Trust (2) Aframax October 13, 2004 $19,700
3.00 Genmar Spirit (2) Aframax October 15, 2004 $19,700
4.00 Genmar Hector (2) Aframax November 3, 2004 $19,700
5.00 Genmar Challenger (2) Aframax December 6, 2004 $19,700
6.00 Genmar Trader (2) Aframax December 15, 2004 $19,700
7.00 Genmar Champ (2) Aframax January 10, 2005 $19,700
8.00 Genmar Star (2) Aframax January 24, 2005 $19,700
9.00 Genmar Endurance (2) Aframax February 12, 2005 $19,700
10.00 Crude Princess Aframax February 20, 2005(3) $25,000
Genmar Orion Suezmax May 14, 2004 $20,500
(1) Before brokers' commissions.
(2) Charterer has the option to extend the time charter for an additional
year at the same rate.
If the charterer does not exercise its option, the Company can extend
the time charter for an additional year, but at a rate reduced by
approximately 20%
(3) Through February 20, 2004, the charter provides for a floating rate
based on weekly spot market rates which can be no less than $16,000
per day and no more than $22,000 per day.
The Company's primary area of operation is the Atlantic basin. The
Company also currently has vessels employed in the Black Sea and Far East to
take advantage of market opportunities and to position vessels in anticipation
of drydockings.
Soponata Acquisition
On March 26, 2004 the Company entered into an agreement to purchase the
fleet and technical operations of Soponata SA for an enterprise value of
$415 million. Included in the acquisition are a total of five vessels and four
newbuilding contracts, three modern double hulled Aframax vessels, two modern
double sided Suezmax vessels, and contracts for four double hulled Suezmax
newbuildings due to deliver in 2006 and 2007. As of April 26, 2004 the Company
had taken delivery of one Aframax vessel, one Suezmax vessel and the technical
management company now named General Maritime Management (Portugal) LLC. The
delivery of the remaining three vessels is expected to be completed by mid
May. The Soponata acquisition will significantly improve the age profile of
General Maritime's fleet. Including the newbuildings, the average age of the
fleet will be reduced to approximately 10 years from its present age of
approximately 12 years. The percentage of double-hull and double-sided
vessels will increase to 83% compared to 79% at the present time. Including
the newbuildings, General Maritime's fleet will increase to 51 vessels,
consisting of 26 Aframax and 25 Suezmax with a carrying capacity of
approximately 6.2 million dwt.
Bank Financing
On April 21, 2004, the Company secured a commitment for an $825 million
senior secured bank facility with Nordea acting as lead arranger. The credit
facility consists of a term loan of $225 million and a revolving loan
component of $600 million. The term loan has a five year maturity at a rate of
LIBOR plus 1.0% and amortizes on a quarterly basis with 19 payments of
$10 million and 1 payment of $35 million. The revolving loan component, which
does not amortize, has a five year maturity at a rate of LIBOR plus 1.0% on
the used portion and a 0.5% commitment fee on the unused portion. Upon
closing of the financing, which is expected to occur by mid June 2004, the
Company's existing $300, $165 and $275 million credit facilities will be
retired. Outstanding borrowings under these existing credit facilities are
$361 million as of March 31, 2004. The $825 million senior secured bank
facility will be secured by all of the vessels in the Company's 47 vessel
fleet after giving effect to the Soponata acquisition. Upon completion of the
refinancing and acquisition, the Company expects to have in excess of
$300 million in liquidity.
Mr. Georgiopoulos continued, "General Maritime continues to effectively
access capital in a manner that best serves our shareholders. General
Maritime's success at securing this new bank facility, at a very favorable
rate, underscores the confidence the market places in the Company's future
growth prospects and our position as a world-class tanker operator. We
appreciate the continued support, as we continue to position the Company for
long-term growth and profitability."
Mr. Georgiopoulos concluded, "With our expanded fleet, General Maritime is
well positioned to further enhance its earnings potential. We intend to build
upon our past success and operate the majority of our fleet on the spot market
in order to benefit from a tanker market that remains strong. In addition to
being optimally positioned to benefit from this strong market, our time
charter coverage provides downside protection for shareholders. In continuing
to seek opportunities to increase our time charter coverage, we will remain
disciplined in signing charters only when they satisfy our return requirements
and meet other strict conditions."
About General Maritime Corporation
General Maritime Corporation is a provider of international seaborne crude
oil transportation services principally within the Atlantic basin which
includes ports in the Caribbean, South and Central America, the United States,
West Africa, the Mediterranean, Europe and the North Sea. We also currently
operate tankers in other regions including the Black Sea and Far East.
General Maritime Corporation owns and operates a fleet of 44 tankers -- 24
Aframax and 20 Suezmax tankers -- making it the second largest mid-sized
tanker company in the world, with a carrying capacity of approximately 5.3
million dwt.
Conference Call Announcement
General Maritime Corporation announced that it will hold a conference call
on Thursday, April 29, 2004 at 8:30 a.m. Eastern Standard Time to discuss its
2004 first quarter financial results. To access the conference call, dial
(719) 457-2698 and ask for the General Maritime Corporation conference call.
A replay of the conference call can also be accessed until May 12, 2004 by
dialing (888) 203-1112 for U.S. callers and (719) 457-0820 for international
callers, and entering the passcode 534141. The conference call will also be
simultaneously webcast and will be available on the Company's website,
http://www.GeneralMaritimeCorp.com.
"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. These forward looking statements are based on management's current
expectations and observations. 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:
failure of one or more of the contemplated acquisitions to close; changes in
demand; a material decline or prolonged weakness in rates in the tanker
market; changes in production of or demand for oil and petroleum products,
generally or in particular regions; greater than anticipated levels of tanker
newbuilding orders or lower than anticipated rates of tanker scrapping;
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; actions taken by regulatory authorities; changes in
trading patterns significantly impacting overall tanker tonnage requirements;
changes in the typical seasonal variations in tanker charter rates; changes in
the cost of other modes of oil transportation; changes in oil transportation
technology; increases in costs including without limitation: crew wages,
insurance, provisions, repairs and maintenance; changes in general domestic
and international political conditions; 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); consents by charterers and ship builders to
assignments of contracts and other factors listed from time to time in the
Company's filings with the Securities and Exchange Commission, including,
without limitation, its Annual Report on Form 10-K for the year ended December
31, 2003.
THE THREE MONTHS ENDED
Aframax Fleet Suezmax Fleet
March-04 March-03 March-04 March-03
Amount Amount Amount Amount
% %
Change % of % of Change % of % of
From Total Total From Total Total
Prior for for Prior for for
Period Period Period Period Period Period
Net Voyage Revenues 21.9% 62,097 50,932 349.8% 84,608 18,811
$ 1,000's 42% 73% 58% 27%
Average Daily TCE 18.1% 29,683 25,139 35.9% 50,228 36,956
Time Charter Revenues 211.7% 24,315 7,801 1341.9% 2,062 143
$ 1,000's 92% 98% 8% 2%
Spot Charter Revenues -12.4% 37,782 43,131 342.2% 82,546 18,668
$ 1,000's 31% 70% 69% 30%
Calendar Days 2.7% 2,126 2,071 239.0% 1,729 510
55% 80% 45% 20%
Vessel Operating Days 3.3% 2,092 2,026 231.0% 1,685 509
55% 80% 45% 20%
Capacity Utilization 0.6% 98.4% 97.8% -2.4% 97.4% 99.8%
# Days Vessels on Time
Charter 216.9% 1,131 357 1175.0% 102 8
92% 98% 8% 2%
# Days Vessels on Spot
Charter -42.4% 961 1,669 215.9% 1,583 501
38% 77% 62% 23%
Average Daily Time
Charter Rate -1.6% 21,492 21,851 13.5% 20,257 17,854
Average Daily Spot
Charter Rate 52.2% 39,330 25,842 40.0% 52,155 37,262
Daily Direct Vessel
Expenses 21.5% 6,338 5,216 12.9% 7,540 6,678
(per Vessel)
Daily G&A 25.5% 1,689 1,346 25.5% 1,689 1,346
(per Vessel)
Total Daily Vessel
Operating Expenses
(per Vessel) 22.3% 8,027 6,562 15.0% 9,229 8,024
Average Age of Fleet at
End of Period
(Years) 12.6 12.3 11.0 11.8
# Vessels at End of
Period 0.0% 23.0 23.0 111.1% 19.0 9.0
55% 72% 45% 28%
Average Number of Vessels 1.4% 23.4 23.0 239.3% 19.0 5.6
55% 80% 45% 20%
DWT at End of Period 0.0% 2,211 2,212 113.0% 2,912 1,367
1,000's 43% 62% 57% 38%
THE THREE MONTHS ENDED
Total Fleet
March-04 March-03
% Change
From Prior
Period Amount Amount
Net Voyage Revenues 110.4% 146,705 69,743
$ 1,000's
Average Daily TCE 41.2% 38,847 27,512
Time Charter Revenues 232.1% 26,377 7,944
$ 1,000's
Spot Charter Revenues 94.7% 120,328 61,799
$ 1,000's
Calendar Days 49.4% 3,855 2,581
Vessel Operating Days 49.0% 3,777 2,535
Capacity Utilization -0.2% 98.0% 98.2%
# Days Vessels on Time Charter 237.8% 1,233 365
# Days Vessels on Spot Charter 17.2% 2,544 2,170
Average Daily Time Charter Rate -1.7% 21,390 21,763
Average Daily Spot Charter Rate 66.1% 47,310 28,479
Daily Direct Vessel Expenses 24.9% 6,878 5,505
(per Vessel)
Daily G&A 25.5% 1,689 1,346
(per Vessel)
Total Daily Vessel Operating Expenses
(per Vessel) 25.0% 8,567 6,851
Average Age of Fleet at End of Period
(Years) 11.9 12.2
# Vessels at End of Period 31.3% 42.0 32.0
Average Number of Vessels 47.7% 42.4 28.7
DWT at End of Period 43.1% 5,123 3,579
1,000's
SOURCE General Maritime Corporation
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Related links:
http://www.GeneralMaritimeCorp.com
CONTACT:
John C. Georgiopoulos, Chief Financial
Officer of General Maritime Corporation, +1-212-763-5670
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