Realized (loss)/gain on derivatives
Realized loss on interest rate swap hedges, increased by $6.7 million, to $34.8 million in the three months ended March 31, 2012, from $28.1 million in the three months ended March 31, 2011, which is attributable to the higher average notional amount of swaps during the three months ended March 31, 2012 compared to the same period of 2011, as well as the reduction in the realized losses being deferred for the respective periods (as discussed below) following the gradual delivery of our vessels under construction, which is partially offset by the higher floating LIBOR rates during the three months ended March 31, 2012 compared to the same period of 2011.
In addition, realized losses on cash flow hedges of $4.8 million and $9.9 million in the three months ended March 31, 2012 and 2011, respectively, were deferred in "Accumulated Other Comprehensive Loss", rather than such realized losses being recognized as expenses, and will be reclassified into earnings over the depreciable lives of these vessels under construction, which are financed by loans with interest rates that have been hedged by our interest rate swap contracts. The table below provides an analysis of the items discussed above, and which were recorded in the three months ended March 31, 2012 and 2011:
Three months Three months ended ended March 31, March 31, ------------- ------------- 2012 2011 ------------- ------------- (in millions)Total realized losses of swaps $ (39.6) $ (38.0)Realized losses of swaps deferred in OCL 4.8 9.9 ------------- ------------- Realized losses of swaps expensed in P&L (34.8) (28.1)Realized losses attributable to overhedging 6.9 9.8 ------------- ------------- Adjusted realized losses attributable to hedged debt $ (27.9) $ (18.3) ============= =============
Adjusted EBITDA
Adjusted EBITDA increased 47.9%, or $31.2 million, to $96.4 million in the three months ended March 31, 2012, from $65.2 million in the three months ended March 31, 2011. Adjusted EBITDA for the first quarter of 2012, is adjusted for an unrealized gain on derivatives of $3.0 million and realized losses on derivatives of $34.8 million. Tables reconciling Adjusted EBITDA to Net Income can be found at the end of this earnings release.
Recent News
On April 27, 2012, we sold and delivered the Montreal. The net sale consideration was $6.6 million. The Montreal was 28 years old and was generating revenue under its time charter, which expired on March 31, 2012.
On May 3, 2012, we took delivery of the newbuilding 13,100 TEU vessel, the Hyundai Smart. The vessel has been deployed on a 12-year time charter with one of the world's major liner companies.
Conference Call and Webcast
On Thursday, May 10, 2012, at 9:00 A.M. EDT, the Company's management will host a conference call to discuss the results.
