George Economou, Chairman and Chief Executive Officer of the Company, commented:
"We continue to be bearish about the short-term performance of the shipping markets. Both tanker and drybulk spot charter rates continue to hover around historic lows. Unfortunately this comes at a time when most of our lucrative legacy charters expire.
As we have mentioned in previous quarters, low-cost financing for traditional shipping assets is generally less available than before and therefore the optimization of our newbuilding programs is our top priority right now. We sold our only two unfinanced tankers and eliminated approximately $100 million in CAPEX. With respect to our Drybulk newbuilding program in China, we are still in discussions with the shipyards in this respect to reduce and prolong our CAPEX program. This process was never going to be easy but we still believe a deal with a shipyard could be struck. Alternatively, we are seeing interest for our vessels in the S&P market.
Our shareholding in Ocean Rig has been our backstop. We recently sold down a portion of our holdings for approximately $120 million. This action was not a preferred option (especially at today's pricing levels) but it was necessary. In addition, we have pledged some of our Ocean Rig shares to our banks to remedy covenant breaches. We continue to be bullish about the prospects for Ocean Rig. The backlog currently stands at $5.1 billion over three years and provides Ocean Rig with substantial cash flow visibility and growth. Given strong industry fundamentals, we expect to further increase our already substantial backlog by entering into long-term contracts for remaining units."
Financial Review: 2012 Fourth Quarter
The Company recorded a net loss of $129.8 million, or $0.34 basic and diluted loss per share, for the three-month period ended December 31, 2012, as compared to a net loss of $6.2 million, or $0.02 basic and diluted earnings per share, for the three-month period ended December 31, 2011. Adjusted EBITDA was $109.5 million for the fourth quarter of 2012, as compared to $169.0 million for the same period in 2011.(3)
For the drybulk carrier segment, net voyage revenues (voyage revenues minus voyage expenses) amounted to $34.9 million for the three-month period ended December 31, 2012, as compared to $81.6 million for the three-month period ended December 31, 2011. For the offshore drilling segment, revenues from drilling contracts decreased by $7.9 million to $229.8 million for the three-month period ended December 31, 2012, as compared to $237.7 million for the same period in 2011. For the tanker segment, net voyage revenues amounted to $6.5 million for the three-month period ended December 31, 2012, as compared to $3.6 million for the same period in 2011.
Total vessels', drilling rigs' and drillships' operating expenses and total depreciation and amortization increased to $194.4 million and $84.8 million, respectively, for the three-month period ended December 31, 2012, from $119.6 million and $82.3 million, respectively, for the three-month period ended December 31, 2011. Total general and administrative expenses increased to $39.5 million in the fourth quarter of 2012 from $36.7 million during the comparative period in 2011.
Interest and finance costs, net of interest income, amounted to $53.5 million for the three-month period ended December 31, 2012, compared to $48.2 million for the three-month period ended December 31, 2011.
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