Ardmore shipping corporation announces financial results for first
quarter 2014
Hamilton, bermuda--(business wire)--ardmore shipping corporation (nyse:asc) (“ardmore” or the “company”) today announced results for the three months ended march 31, 2014. highlights reported ebitda (see non-gaap measures section below) of $4.0 million for the three months ended march 31, 2014, an increase of $1.4 million from $2.6 million for the three months ended march 31, 2013. the company reported a net loss of $0.40 million for the three months ended march 31, 2014, or $0.021 basic and diluted net loss per share, as compared to a net loss of $0.04 million, or $0.005 basic and diluted net loss per share, for the three months ended march 31, 2013. reported adjusted ebitda (see non-gaap measures section below) of $4.3 million for the three months ended march 31, 2014, an increase of $1.7 million from $2.6 million for the three months ended march 31, 2013. the company reported an adjusted net loss (see non-gaap measures section below) of $0.06 million for the three months ended march 31, 2014, or $0.003 basic and diluted adjusted loss per share (see non-gaap measures section below), as compared to an adjusted net loss of $0.04 million, or $0.005 basic and diluted adjusted loss per share, for the three months ended march 31, 2013. successful completion of a follow-on equity offering raising gross proceeds of $108.7 million including over-allotment option exercised by underwriters on march 17, 2014. closed a senior debt facility on march 19, 2014 with abn amro bank n.v., nordea bank finland plc and skandinaviska enskilda banken ab in the amount of $172 million to finance eight of our vessels currently on order. declared a cash dividend of $0.10 per share for the quarter ended march 31, 2014. took delivery of two mr product and chemical newbuildings in the first quarter 2014. the ardmore seavantage and ardmore seavanguard are the third and fourth of ardmore’s eco-design vessels, which delivered from spp shipbuilding co., ltd. in south korea in january and february, respectively. took delivery of the ardmore seamariner, a 45,726 dwt mr product tanker built in october 2006 at minami nippon shipbuilding co., ltd., japan, on january 7, 2014. following delivery the vessel underwent a scheduled drydock and upgrading to eco-mod and, on completion, commenced a time charter at $16,050 per day. completed a series of upgrades on the ardmore centurion which, following completion, commenced a time charter with an oil major trading in product and chemicals at $13,500 per day. commenced a one-year time charter for the ardmore seavaliant at a rate of $17,100 per day starting in february 2014. anthony gurnee, the company’s chief executive officer, commented: “we are pleased with the company’s first quarter 2014 results, which reflect improvement in our chartering performance as well as continued fleet expansion. we took delivery of two newbuildings and one second-hand vessel during the quarter, so that now 52% of our fleet is on the water generating cash flow. complementing our fleet growth during the quarter, we increased our financial flexibility significantly by raising $108.7 million from an upsized follow-on equity offering to fund vessel acquisitions, as well as closing on a $172 million senior debt facility to fund our existing newbuilding program. we believe ardmore is well positioned to benefit from favorable long-term fundamentals for product and chemical tankers by continuing to engage in well-timed fleet growth.” summary of recent and first quarter events fleet operations on january 7, 2014, ardmore took delivery of the 2006-built ardmore seamariner, a 45,726 dwt mr product tanker built at minami-nippon shipbuilding co., ltd. in japan, which was acquired by the company in october 2013. on delivery, the vessel entered drydock, where it was upgraded to eco-mod in conjunction with its scheduled intermediate survey. on completion of drydock, the vessel commenced employment on a three-month time charter at a rate of $16,050 per day. we also took delivery of the ardmore seavantage and ardmore seavanguard on january 17, 2014 and february 14, 2014, respectively. these vessels are 49,997 dwt imo 3 eco-design mr product and chemical tankers built at spp shipbuilding co., ltd. in south korea. following delivery, both vessels commenced employment under existing charter arrangements with a major oil trader. on january 30, 2014, ardmore completed upgrades to the ardmore centurion. the upgrades further improve fuel efficiency, allow carriage of a broader range of cargos and reduce cleaning time, which will enhance the vessel’s earnings potential. as a result of the above deliveries, ardmore’s fleet currently stands at 11 ships in operation and 10 eco-design product and chemical tankers on order, with our next vessel on order scheduled to deliver in november 2014. financing on march 11, 2014, ardmore closed an equity offering of 7,000,000 shares at $13.50 per share, an upsized offering from the initially launched offering of 6,000,000 shares on march 3, 2014. our underwriters subsequently exercised an over-allotment option for an additional 1,050,000 shares, also at $13.50 per share, on march 17, 2014. total gross proceeds to ardmore amounted to $108.7 million. on march 19, 2014, ardmore closed a senior debt facility with abn amro bank n.v., nordea bank finland plc and skandinaviska enskilda banken ab (“seb”) in the amount of $172 million. the proceeds will be used to finance up to 65% of the purchase price of eight vessels that ardmore currently has on order. the margin is 3.15% above libor and the terms include an accordion option whereby, subject to lenders approval, ardmore may request to increase the facility to finance the acquisition of additional vessels. dividend on april 15, 2014, ardmore’s board of directors announced a cash dividend of $0.10 per share for the quarter ended march 31, 2014. the cash dividend is payable on may 15, 2014 to all shareholders of record on april 30, 2014. ardmore currently intends to pay our shareholders quarterly dividends of $0.10 per share, or $0.40 per share per year. results for the three months ended march 31, 2014 and 2013 for the three months ended march 31, 2014, the company reported ebitda (see non-gaap measures section below) of $4.0 million, an increase of $1.4 million from $2.6 million for the three months ended march 31, 2013. the company reported a net loss of $0.40 million, or $0.021 basic and diluted loss per share, for the three months ended march 31, 2014, as compared to a net loss of $0.04 million, or $0.005 basic and diluted loss per share, for the three months ended march 31, 2013. for the three months ended march 31, 2014, the company reported adjusted ebitda (see non-gaap measures section below) of $4.3 million, an increase of $1.7 million from $2.6 million for the three months ended march 31, 2013. adjusted net loss (see non-gaap measures section below) was $0.06 million, or $0.003 basic and diluted adjusted loss per share (see non-gaap measures section below), for the three months ended march 31, 2014 as compared to an adjusted net loss of $0.04 million, or $0.005 basic and diluted adjusted loss per share for the three months ended march 31, 2013. ebitda and net loss were adjusted for share based compensation (non-cash item) in each period, as applicable. management’s discussion and analysis of financial results revenue for the three months ended march 31, 2014 was $12.4 million, an increase of $5.1 million from $7.3 million for the three months ended march 31, 2013. time charter revenue was $10.1 million for the three months ended march 31, 2014, an increase of $4.9 million from $5.2 million for the three months ended march 31, 2013. the increase primarily relates to additional revenue attributable to the ardmore seaventure, ardmore seavantage, ardmore seamariner and ardmore seavanguard, which commenced trading on june 7, 2013, january 18, 2014, february 1, 2014 and february 17, 2014, respectively, along with increases in rates for time charter renewals since the three months ended march 31, 2013. pool revenue was $2.3 million for the three months ended march 31, 2014, an increase of $0.2 million from $2.1 million for the three months ended march 31, 2013. this increase is due to increased rates earned by the pool. commissions and voyage related costs were $0.25 million for the three months ended march 31, 2014, as compared to $0.18 million for the three months ended march 31, 2013. this increase is due to increases in revenue days in-line with vessel deliveries outlined above. vessel operating expenses were $5.9 million for the three months ended march 31, 2014, an increase of $2.0 million from $3.9 million for the three months ended march 31, 2013. this increase is primarily due to an increase in the number of vessels in operation for the three months ended march 31, 2014 in addition to the timing of operating expenses between quarters. fleet operating costs per day, including technical management fees, were $6,520 for the three months ended march 31, 2014 as compared to $6,502 for the three months ended march 31, 2013. depreciation expense for the three months ended march 31, 2014 was $3.0 million, an increase of $1.3 million from $1.7 million for the three months ended march 31, 2013. the increase is due to an increase in the average number of owned vessels to 9.9 for the three months ended march 31, 2014 from 6.4 for the three months ended march 31, 2013. amortization of deferred dry dock expenditure for the three months ended march 31, 2014 was $0.4 million, as compared with $0.3 million for the three months ended march 31, 2013. the capitalized costs of drydocking are depreciated on a straight line basis to the next scheduled drydocking. as such, movement in amortization of deferred drydock expenditure is in-line with timing of vessels undergoing drydock. general and administrative expenses for the three months ended march 31, 2014 were $2.3 million, as compared to $0.7 million for the three months ended march 31, 2013. the increase is primarily due to costs associated with being a publicly listed company along with one-off overhead costs incurred with our most recent equity offering in march 2014. interest expense and finance costs, which include loan interest, capital lease interest and amortization of deferred financing fees, were $0.9 million for the three months ended 31 march, 2014, an increase of $0.4 million from $0.5 million for the three months ended march 31, 2013. the increase relates to an increase in average debt balance following the delivery of vessels since march 31, 2013, additional interest costs associated with the capital lease facility for the ardmore calypso and ardmore capella entered into in april 2013, and an increase in deferred financing fees amortization due to new debt drawdowns and financing arrangements. these increases were offset by an increase in the amount of capitalized interest in line with deposits paid for ardmore’s current vessels on order. capitalized interest amounted to $0.9 million for the three months ended march 31, 2014, an increase of $0.7 million from $0.2 million for the three months ended march 31, 2013. liquidity as of march 31, 2014, the company had $128.1 million (december 31, 2013: $56.9 million) available in cash and cash equivalents. the following debt and capital lease liabilities were outstanding as of: conference call the company plans to have a conference call on tuesday, may 13, 2014 at 10:00 a.m. eastern time to discuss its results for the quarter ended march 31, 2014. all interested parties are invited to listen to the live conference call and slide presentation by choosing from the following options: participants should dial into the call 10 minutes before the scheduled time. if you are unable to participate at this time, a replay of the call will be available for two weeks at 888-203-1112 or 719-457-0820. enter the passcode 9150205 to access the audio replay. the information provided on the teleconference is only accurate at the time of the conference call, and the company will take no responsibility for providing updated information. about ardmore shipping corporation ardmore shipping owns and operates a fleet of mid-size product and chemical tankers ranging from 17,500 dwt to 50,300 dwt. we provide seaborne transportation of petroleum products and chemicals worldwide to oil majors, national oil companies, oil and chemical traders, and chemical companies, with our modern, fuel-efficient fleet of tankers. ardmore’s core strategy is to develop a modern, high-quality fleet of product and chemical tankers, build key long-term commercial relationships, maintain our cost advantage in assets, operations and overhead, while creating significant synergies and economies of scale as the company grows. we provide our services to customers through voyage charters, commercial pools and time charters and enjoy close working relationships with key commercial and technical management partners. we view the continued development of these relationships as crucial to our long-term success. ardmore shipping corporation unaudited condensed interim consolidated balance sheet (expressed in u.s. dollars, unless otherwise stated) ardmore shipping corporation unaudited condensed statement of operations (expressed in u.s. dollars, unless otherwise stated) ardmore shipping corporation unaudited condensed interim statement of cash flows (expressed in u.s. dollars, unless otherwise stated) ardmore shipping corporation unaudited other operating data (expressed in u.s. dollars, unless otherwise stated) ardmore shipping corporation fleet list as at march 31, 2014 monthconstructed countryconstructed charterrate$ / day (1) charterexpires non-gaap measures this press release describes ebitda, adjusted ebitda, adjusted net loss and adjusted net loss per share, which are not measures prepared in accordance with u.s. gaap. these non-gaap measures are presented in this press release as we believe that they provide investors with a means of evaluating and understanding how ardmore’s management evaluate operating performance. these non-gaap measures should not be considered in isolation from, as substitutes for, or superior to financial measures prepared in accordance with u.s. gaap. all amounts are expressed in u.s. dollars, unless otherwise stated. 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 tanker vessel capacity, changes in our operating expenses, including bunker prices, drydocking and insurance costs, the market for our vessels, competition in the tanker industry, 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, piracy or political events, vessels breakdowns and instances of off-hires and other factors. please see our filings with the securities and exchange commission for a more complete discussion of these and other risks and uncertainties.
