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Paragon Shipping Inc. reports third quarter and nine months to 30 September 2009 Results

Shipping News | November 11, 2009 | View Comments

  • Paragon Shipping Inc., a global shipping transportation company specializing in drybulk cargoes, announced yesterday its results for the third quarter and nine months ended September 30, 2009. Commenting on the results, Michael Bodouroglou, Chairman and Chief
    Executive Officer of Paragon Shipping, stated, “Once again, Paragon has
    delivered a strong set of financial results against a backdrop of
    global economic uncertainty.

    For the three months ended September 30,
    2009, we generated financial results similar to those achieved a year
    ago during a period of strong market conditions and for the nine months
    ended September 30, 2009, our adjusted net income increased by 10%
    while adjusted EBITDA improved by over $4.5 million compared to the
    corresponding period during 2008. Our performance is a testament to our
    strategy and execution during a very challenging time in the market
    place.”

    Mr. Bodouroglou concluded, “We believe that we remain well positioned
    for current conditions in the market. While we expect 2010 to be
    another challenging year for drybulk shipping, by fixing 100% of our
    revenue days in 2010, 90% in 2011 and 45% in 2012, our chartering
    strategy provides us with substantial visibility into both our revenue
    and cash flow going forward. This gives us the confidence to
    strategically invest in the growth of our business as the right
    opportunities present themselves.”

    Third Quarter 2009 Financial Results:

    Time charter revenue for the third quarter of 2009 was $40.1 million,
    compared to $43.6 million for the third quarter of 2008. The Company
    reported net income of $18.0 million, or $0.40 per basic and diluted
    share for the third quarter of 2009, calculated on 44,653,942 weighted
    average number of basic and diluted shares outstanding for the period
    and reflecting the impact of the non-cash items discussed below. For
    the third quarter of 2008, the Company reported net income of $18.9
    million, or $0.70 and $0.69 per basic and diluted share, respectively,
    calculated on 27,034,270 weighted average number of basic shares and on
    27,207,826 weighted average number of diluted shares.

    Excluding all non-cash items described below, adjusted net income for
    the third quarter of 2009 was $15.1 million, or $0.33 per basic and
    diluted share. This compares to adjusted net income of $14.6 million,
    or $0.54 per basic and diluted share for the third quarter of 2008.
    Please refer to the table at the back of this press release for
    reconciliations of GAAP net income to non-GAAP adjusted net income and
    GAAP earnings per share to non-GAAP adjusted earnings per share.

    EBITDA was $28.4 million for the third quarter of 2009, compared to
    $30.6 million for the third quarter of 2008. This was calculated by
    adding $18.0 million to net income for the third quarter of 2009, net
    interest expense and depreciation that in the aggregate amounted to
    $10.4 million for the third quarter of 2009. Adjusted EBITDA, excluding
    all non-cash items described below, was $24.9 million for the third
    quarter of 2009, compared to $25.7 million for the third quarter of
    2008. Please see the table at the back of this release for a
    reconciliation of EBITDA and Adjusted EBITDA to net income.

    The Company operated 12 vessels during the third quarter of 2009,
    earning an average time charter equivalent rate, or TCE rate, of
    $34,687 per day, compared to an average of 11.6 vessels during the
    third quarter of 2008, earning an average time charter equivalent rate
    of $40,250 per day. Please see the table at the back of this release
    for a reconciliation of TCE rates to time charter revenue.

    Total adjusted operating expenses for the third quarter of 2009 were
    $6.6 million, or approximately $5,983 per day, including vessel
    operating expenses, management fees, general and administrative
    expenses and drydocking costs, but excluding $0.4 million of
    share-based compensation for the period. For the third quarter of 2008,
    total adjusted operating expenses were $8.9 million, or approximately
    $8,365 per day, including vessel operating expenses, management fees,
    general and administrative expenses and drydocking costs, but excluding
    $0.1 million of share-based compensation.

    Dividend Declared

    The Company’s Board of Directors declared a quarterly dividend of $0.05
    per share with respect to the third quarter of 2009, payable on
    December 14, 2009 to shareholders of record as of the close of business
    on December 1, 2009.

    Time Charter Coverage Update

    On November 4, 2009, we agreed with STX Panocean Co. Ltd. to enter into
    a new time charter agreement for “Sapphire Seas.” The time charter is
    for a period of approximately 23 to 25 months at a gross daily charter
    rate of $13,700 and it will commence after the expiration of the
    current time charter to Korea Line Corporation.

    Pursuant to its time chartering strategy, Paragon Shipping Inc. mainly
    employs vessels under fixed rate charters for periods ranging from one
    to five years. Assuming all options exercised, the Company has secured
    under such contracts 100%, 90% and 45% of its fleet capacity in the
    remainder of 2010, in 2011 and in 2012, respectively.

    Cash Flows

    For the nine months ended September 30, 2009, the Company generated net
    cash from operating activities of $62.2 million, compared to $60.6
    million for the nine months ended September 30, 2008. For the nine
    months ended September 30, 2009, net cash used in investing activities
    was $32.8 million and net cash from financing activities was $38.1
    million. For the nine months ended September 30, 2008, net cash used in
    investing activities was $78.1 million and cash from financing
    activities was $51.1 million.

    Nine months ended September 30, 2009 Financial Results:

    Time charter revenue for the nine months ended September 30, 2009 was
    $124.0 million, compared to $125.0 million for the nine months ended
    September 30, 2008. The Company reported net income of $53.0 million,
    or $1.50 per basic and diluted share for the nine months ended
    September 30, 2009, calculated on 34,951,005 weighted average number of
    basic and diluted shares outstanding for the period and reflecting the
    impact of the non-cash items discussed below. For the nine months ended
    September 30, 2008, the Company reported net income of $59.3 million,
    or $2.21 and $2.19 per basic and diluted share, respectively,
    calculated on 26,746,695 weighted average number of basic shares and on
    27,040,928 weighted average number of diluted shares.

    Excluding all non-cash items described below, adjusted net income for
    the nine months ended September 30, 2009 was $46.4 million, or $1.32
    per basic and diluted share. This compares to adjusted net income of
    $42.2 million, or $1.58 and $1.56 per basic and diluted share,
    respectively, for the nine months ended September 30, 2008. Please
    refer to the table at the back of this press release for
    reconciliations of GAAP net income to non-GAAP adjusted net income and
    GAAP earnings per share to non-GAAP adjusted earnings per share.

    EBITDA was $87.4 million for the nine months ended September 30, 2009,
    compared to $93.4 million for the nine months ended September 30, 2008.
    This was calculated by adding $53.0 million to net income for the nine
    months ended September 30, 2009, net interest expense and depreciation
    that in the aggregate amounted to $34.5 million for the nine months
    ended September 30, 2009. Adjusted EBITDA, excluding all non-cash items
    described below, was $78.8 million for the nine months ended September
    30, 2009, compared to $74.3 million for the nine months ended September
    30, 2008. Please see the table at the back of this release for a
    reconciliation of EBITDA and Adjusted EBITDA to net income.

    The Company operated 12 vessels during the nine months ended September
    30, 2009, earning an average time charter equivalent rate, or TCE rate,
    of $36,219 per day, compared to an average of 11.2 vessels during the
    nine months ended September 30, 2008, earning an average time charter
    equivalent rate of $39,569 per day. Please see the table at the back of
    this release for a reconciliation of TCE rates to time charter revenue.

    Total adjusted operating expenses for the nine months ended September
    30, 2009 were $20.3 million, or approximately $6,183 per day, including
    vessel operating expenses, management fees, general and administrative
    expenses and drydocking costs, but excluding $0.7 million of
    share-based compensation for the period. For the nine months ended
    September 30, 2008, total adjusted operating expenses were $22.2
    million, or approximately $7,237 per day, including vessel operating
    expenses, management fees, general and administrative expenses and
    drydocking costs, but excluding $0.4 million of share-based
    compensation.

    Source: Paragon Shipping Inc.

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