First Quarter 2013 Financial Results:
Net revenues for the first quarter of 2013 decreased to $5.6 million from $17.4 million in the same quarter of 2012. The decrease of 68% in net revenues reflects lower freight rates earned in the dry bulk market as compared to the same quarter last year, as well as a 57% reduction in operating days that resulted from the sale of vessel owning subsidiaries.
EBITDA and Adjusted EBITDA
Adjusted EBITDA was negative $0.8 million for the first quarter of 2013, excluding $5.5 million of gains resulting from the sales of subsidiaries and $0.9 million of non-cash impairment losses associated with the African Oryx sale. Including the aforementioned items, EBITDA stands positive at $3.8 million. For the first quarter of 2012, Seanergy recorded Adjusted EBITDA of $4.9 million, while EBITDA was $2.5 million.
For more information please refer to the EBITDA, Adjusted EBITDA and Adjusted Net Loss/Income reconciliation section contained in this press release.
For the first quarter of 2013, net income amounted to $1.1 million or $0.09 per basic and diluted share, as compared to a net loss for the first quarter of 2012 of $6.4 million, or $0.54 per basic and diluted share, based on weighted average common shares outstanding of 11,958,063 basic and 11,959,282 diluted for the first quarter of 2013, and 11,803,933 basic and diluted for the first quarter of 2012.
For the first quarter of 2013, adjusted net loss excluding gains from the sales of subsidiaries and non-cash impairment losses was $3.6 million, as compared to an adjusted net loss of $4.0 million in 2012.
Seanergy ended the first quarter of 2013 with $176.9 million of outstanding debt. This reflects the reduction of our outstanding indebtedness by $31.8 million, during the three month period ended March 31, 2013.
First Quarter 2013 Developments:
Sale of Subsidiaries in Satisfaction of DVB Loan
On January 29, 2013, Seanergy's subsidiary, Maritime Capital Shipping Limited ("MCS"), sold its 100% ownership interest in the four companies that owned the Handysize dry bulk vessels Fiesta, Pacific Fantasy, Pacific Fighter and Clipper Freeway for a nominal consideration. In exchange for the sale, approximately $30.3 million of outstanding debt was discharged.
The buyer was a third-party nominee of the lenders under the senior secured credit facility with DVB Merchant Bank (Asia) Ltd., as agent.
In connection to the sale, the Company's Board of Directors obtained a fairness opinion from an independent third party.
Impairment of African Oryx
The Company assessed the recoverability of the carrying value, including unamortized deferred dry docking costs, of the vessel African Oryx due to its sale in the second quarter of 2013 and, as a result, recognized an impairment loss of $0.9 million.
Sale of African Oryx
On April 10, 2013, Seanergy sold the African Oryx, a 24,112 DWT Handysize vessel built in 1997. Gross proceeds amounted to $4.1 million and were used to repay debt.
Receipt of NASDAQ Notice
The Company received a written notification from the Nasdaq Capital Market ("Nasdaq" or the "Capital Market"), dated May 1, 2013, indicating that the Company is not in compliance with the requirement to maintain a minimum of $2.5 million in stockholders' equity for continued listing on the Capital Market, pursuant to Nasdaq Listing Rule 5550(b)(1). The Company reported negative stockholders' equity of $101.6 million for the fiscal year ended December 31, 2012. In addition, as of April 30, 2013, the Company did not meet the alternative standards for continued listing, including a market value of listed securities of at least $35 million, pursuant to Nasdaq Listing Rule 5550(b)(2), or net income from continuing operations of at least $500,000, pursuant to Nasdaq Listing Rule 5550(b)(3).
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