Toro Corp. (NASDAQ: TORO), (“Toro”, or the “Company”), an
international energy transportation services company, today
announced its results for the three months and the year ended
December 31, 2023.
Highlights of the Fourth quarter Ended
December 31, 2023:
- Total vessel revenues:
$11.9 million, as compared to $38.0 million for the three months
ended December 31, 2022, or a 68.7% decrease;
- Net income: $28.2 million,
as compared to $25.1 million for the three months ended December
31, 2022, or a 12.4% increase;
- Earnings (basic) per common
share: $1.41 per share, as compared to $2.65 per share for the
three months ended December 31, 2022;
-
EBITDA(1): $28.4 million,
as compared to $27.2 million for the three months ended December
31, 2022;
- Cash and restricted cash of
$155.6 million as of December 31, 2023, as compared to $42.5
million as of December 31, 2022;
- Delivery of the
M/T Wonder Formosa to its new owners on
November 16, 2023, after entering into an agreement to sell the
vessel on September 1, 2023 for $18.0 million, resulting in a net
capital gain of $8.2 million;
- Delivery of the
M/T Wonder Vega to its new owners on
December 21, 2023, after entering into an agreement to sell the
vessel on September 5, 2023 for $31.5 million, resulting in a net
capital gain of $16.5 million; and
- Repurchased 222,600 common
shares at an aggregate cost of $1.0 million under the Company’s
share repurchase program approved on November 6,
2023.
(1) EBITDA is not a recognized measure under
United States generally accepted accounting principles (“U.S.
GAAP”). Please refer to Appendix B for the definition and
reconciliation of this measure to Net income, the most directly
comparable financial measure calculated and presented in accordance
with U.S. GAAP.
Highlights of the Year Ended December
31, 2023:
- Total vessel revenues:
$78.5 million, as compared to $111.9 million for the year ended
December 31, 2022, or a 29.8% decrease;
- Net income: $140.6 million,
as compared to $49.9 million for the year ended December 31, 2022,
or a 181.8% increase;
- Earnings (basic) per common
share: $8.69 per share, as compared to $5.28 per share for the year
ended December 31, 2022;
-
EBITDA(1): $144.7
million, as compared to $58.9 million for the year ended December
31, 2022;
- On April 17, 2023, the
Company entered into a subscription agreement with Pani
Corp., a company controlled by our Chairman and
Chief Executive Officer, pursuant to which Pani Corp. purchased,
8,500,000 common shares for gross proceeds of
$19,465,000;
- On August 7, 2023, the
Company purchased 50,000 5.00% Series D Cumulative Perpetual
Convertible Preferred Shares (“Series D Preferred Shares”) of
Castor Maritime Inc. (“Castor”) with a stated amount of $1,000 each
for total consideration of $50.0 million in cash; and
- Our spin-off (the
“Spin-Off”) by Castor was completed on March 7, 2023 and our shares
commenced trading on the Nasdaq Capital Market on the same
date.
(1) EBITDA is not a recognized measure under
United States generally accepted accounting principles (“U.S.
GAAP”). Please refer to Appendix B for the definition and
reconciliation of this measure to Net income, the most directly
comparable financial measure calculated and presented in accordance
with U.S. GAAP.
Management Commentary:
Mr. Petros Panagiotidis, Chief Executive Officer
of the Company commented:
“2023 was a milestone year for Toro as it went
public in Nasdaq in March, raised new capital in April and entered
the LPG segment during the second quarter buying four modern LPG
carrier vessels.
The tanker market remained robust during the
fourth quarter, during which period we continued to take steps to
modernize our fleet, taking advantage of the demand for secondhand
tanker vessels to profitably dispose of older tonnage reducing the
average age of our fleet to 9.5 years today from 17.7 years at the
end of 2022. With the delivery of M/T Wonder Sirius to its buyers
in January 2024, the disposals of older tonnage are almost
complete, resulting in total to a $99.0 million capital gain for
our Company in 2023 and an additional $20.9 million gain expected
to be booked in the first quarter of 2024.
Importantly, we started implementing our share
repurchase program in November 2023 and bought back $2.8 million
worth of shares until February 8, 2024, as we enjoy a strong
balance sheet with significant cash balances and currently
without any debt following the repayment in January 2024 of our
only outstanding loan facility.”
Earnings Commentary:
Fourth quarter ended December 31, 2023,
and 2022 Results
Total vessel revenues, net of charterer’s
commissions, decreased to $11.9 million in the three months ended
December 31, 2023, from $38.0 million in the same period in 2022.
This decrease is mainly associated with the (i) reduction in the
Available Days of Aframax/LR2 vessels in our fleet to 130 days in
the three months ended December 31, 2023 from 514 days in the same
period in 2022, due to the sale of five of our six Aframax/LR2
vessels, and (ii) decrease of the Daily TCE Rate to $16,599 in the
three months ended December 31, 2023 from $49,768 in the same
period in 2022, mainly due to the change in the mix of our fleet
following the addition of the LPG vessels which earn a lower Daily
TCE Rate than the Handysize and Aframax/LR2 tanker vessels due to
their size and the trade they operate in. Daily TCE Rate is not a
recognized measure under U.S. GAAP. Please refer to Appendix B for
the definition and reconciliation of this measure to Total vessel
revenues, the most directly comparable financial measure calculated
and presented in accordance with U.S. GAAP.
Voyage expenses for our fleet decreased by $1.9
million to $1.4 million in the three months ended December 31,
2023, from $3.3 million in the same period of 2022. This decrease
in voyage expenses is mainly associated with the decrease in (i)
the Ownership Days of the Aframax/LR2 vessels in our fleet due to
the decrease of the average number of operating Aframax/LR2 vessels
to 1.9 in the three months ended December 31, 2023, from 6.0
vessels in the same period of 2022 and (ii) expenses associated
with our vessels’ commercial employment arrangements as during the
three months ended December 31, 2023, the majority of our tanker
vessels operated under pool agreements pursuant to which our pool
operators bear bunker consumption costs and port expenses, whereas
in the three months ended December 31, 2022, a number of our
Aframax/LR2 vessels operated under voyage charters under which we
bore bunker consumption costs and port expenses, resulting in a
decrease in such expenses as compared to the fourth quarter of
2022.
The decrease in Vessel operating expenses by
$1.3 million to $4.5 million in the three months ended December 31,
2023, from $5.8 million in the same period in 2022, mainly reflects
the decrease (i) in the daily vessel operating expenses of the
vessels in our fleet to $6,662 in the three months ended December
31, 2023 from $7,884 in the same period in 2022 as a result of the
decrease of crewing expenses and (ii) in the Ownership Days of our
fleet to 681 days in the three months ended December 31, 2023 from
736 days in the same period in 2022.
Depreciation expenses for our fleet decreased to
$1.3 million in the three months ended December 31, 2023, from $1.6
million in the same period in 2022 as a result of the decrease in
the Ownership Days of our fleet. Dry-dock and special survey
amortization charges amounted to $0.1 million for the three months
ended December 31, 2023, compared to a charge of $0.3 million in
the three months ended December 31, 2022. This decrease in dry-dock
amortization charges primarily resulted from the decrease in
dry-dock amortization days from 184 days in the three months ended
December 31, 2022 to 102 dry-dock amortization days in the three
months ended December 31, 2023.
General and administrative expenses in the three
months ended December 31, 2023, amounted to $2.3 million, whereas,
in the same period of 2022, general and administrative expenses
totaled $0.7 million. This increase is mainly associated with (i)
the stock based compensation cost for non-vested shares granted
under our Equity Incentive Plan amounting to $1.2 million and (ii)
a $0.8 million flat vessel management fee for the three months
ended December 31, 2023. For the three months ended December 31,
2022, General and administrative expenses reflect the expense
allocations made to the Company by Castor based on the proportion
of the number of Ownership Days of our fleet vessels to the total
Ownership Days of Castor’s full fleet.
Management fees amounted to $0.7 million in the
three months ended December 31, 2023, unchanged compared to the
same period of 2022, and reflect the (i) increased management fees
with effect from July 1, 2023, from $975 per vessel per day to
$1,039 per vessel per day, which were adjusted under the terms of
the Amended and Restated Master Management Agreement effective from
July 1, 2022, (ii) entry into new management agreements with Castor
Ships S.A. for our four LPG carriers, which are effective from the
date of such vessel’s purchase agreements, on April 26, 2023 and
(iii) partly offset by the decrease in the Ownership Days of our
fleet.
Interest and finance costs, net amounted to
$(1.2) million in the three months ended December 31, 2023,
whereas, in the same period of 2022, interest and finance costs,
net amounted to $0.1 million. This variation is mainly due to
higher cash balances compared to the same period of 2022 and the
increase in interest income for the three months ended December 31,
2023 on our available cash, which more than offsets the increase in
the weighted average interest rate charged on our long-term debt
from 6.7% in the three months ended December 31, 2022 to 8.6% in
the same period of 2023.
Recent
Financial Developments
Commentary:
Equity update
On January 16, 2024, the Company paid to Castor
a dividend amounting to $0.4 million on its 1.00% Series A Fixed
Rate Cumulative Perpetual Convertible Preferred Shares (the “Series
A Preferred Shares”) for the period from October 15, 2023 to
January 14, 2023.
Under the Company’s $5.0 million share
repurchase program expiring in March 31, 2024, during the period
from January 1, 2024 to February 8, 2024, the Company cancelled the
43,349 treasury shares which were outstanding as of December 31,
2023, and repurchased 321,775 common shares at an aggregate cost of
$1.8 million, with $2.2 million remaining under program. Shares may
be repurchased in open market transactions and/or privately
negotiated transactions. The timing, manner and total amount of any
share repurchases will be determined by management at its
discretion and will depend upon business, economic and market
conditions, corporate and regulatory requirements, prevailing share
prices, and other considerations. The Company is not obligated to
acquire any specific amount of common shares under the program.
As of February 8, 2024, we had 18,978,409 common
shares issued and 18,656,634 common shares (net of treasury shares)
outstanding.
Liquidity/ Financing/ Cash flow
update
Our consolidated cash position (including our
restricted cash) increased by $113.1 million, from $42.5 million as
of December 31, 2022, to $155.6 million as of December 31, 2023.
During the year ended December 31, 2023, our cash position
increased mainly as a result of (i) $56.1 million of net operating
cash flows provided, (ii) $50.7 million of net investing cash flows
provided, including $172.9 million of net proceeds from the sale of
M/T Wonder Bellatrix, M/T Wonder Polaris, M/T Wonder Musica, M/T
Wonder Avior, M/T Wonder Formosa and M/T Wonder Vega, partly offset
by $50.0 million paid to purchase 50,000 Series D Preferred Shares
of Castor and payments of $72.2 million mainly related to the
acquisition of LPG Dream Terrax, LPG Dream Arrax, LPG Dream Syrax
and LPG Dream Vermax, and (iii) $6.3 million of net financing
cash flows provided, including $18.7 million net cash inflow from
the subscription agreement with Pani Corp., for the issuance of
8,500,000 common shares, offset by cash payments of $2.7 million to
reimburse Spin-Off expenses incurred by Castor on our behalf, $8.0
million for scheduled principal repayments and early prepayment on
our debt due to sale of M/T Wonder Polaris, $1.0 million for the
payment for repurchase of common shares, $0.9 million for the
payment of dividends to Toro on our Series A Preferred Shares for
the period from March 7, 2023 to October 14, 2023, and a net inflow
for increase in former parent company investment amounting to $0.2
million.
As of December 31, 2023, our total debt, gross
of unamortized deferred loan fees, was $5.3 million, of which $1.3
million is repayable within one year, as compared to $13.3 million
of gross total debt as of December 31, 2022.
Recent
Business Developments
Commentary:
On September 1, 2023, we entered into an
agreement with an unaffiliated third party for the sale of the M/T
Wonder Formosa at a price of $18.0 million. The vessel was
delivered to its new owner on November 16, 2023. In connection with
this sale, the Company recognized a net gain of $8.2 million during
the fourth quarter of 2023.
On September 5, 2023, we entered into an
agreement with an unaffiliated third party for the sale of the M/T
Wonder Vega at a price of $31.5 million. The vessel was delivered
to its new owner on December 21, 2023. In connection with this
sale, the Company recognized a net gain of $16.5 million during the
fourth quarter of 2023.
On January 8, 2024, we entered into an agreement
with an unaffiliated third party for the sale of the M/T Wonder
Sirius at a price of $33.8 million. The vessel was delivered to its
new owner on January 24, 2024. We expect to record during the first
quarter of 2024 a net gain on the sale of the M/T Wonder Sirius of
approximately $20.9 million, excluding any transaction related
costs. We used part of the proceeds of the sale of the M/T Wonder
Sirius to fully prepay the remaining outstanding balance of $5.3
million under our only outstanding loan facility, under which the
M/T Wonder Sirius served as security. As a result, we have no
outstanding indebtedness under any facility as of February 9,
2024.
Fleet Employment Status (as of February
9, 2024) During the three months ended December 31, 2023,
we operated on average 7.4 vessels earning a Daily TCE Rate(1) of
$16,599 as compared to an average of 8.0 vessels earning a Daily
TCE Rate(1) of $49,768 during the same period in 2022. Our
employment profile as of February 9, 2024 is presented immediately
below.
(1) Daily TCE Rate is not a recognized
measure under U.S. GAAP. Please refer to Appendix B for the
definition and reconciliation of this measure to Total vessel
revenues, the most directly comparable financial measure calculated
and presented in accordance with U.S. GAAP.
|
Handysize Tankers |
|
Vessel Name |
Type |
DWT |
Year Built |
Country ofConstruction |
Type ofEmployment |
GrossCharterRate |
Estimated RedeliveryDate |
|
Earliest |
Latest |
|
Wonder Mimosa |
Handysize |
36,718 |
2006 |
Korea |
Tanker Pool(1) |
N/A |
N/A |
N/A |
|
LPG Carriers |
|
|
Type |
DWT |
Year Built |
Country of Construction |
Type of Employment |
Gross Charter Rate |
Estimated RedeliveryDate |
|
Earliest |
Latest |
|
Dream Terrax |
LPG carrier 5,000 cbm |
4,743 |
2020 |
Japan |
TC(2) period |
$310,000 per month |
Aug-24 |
Aug-25 |
|
Dream Arrax |
LPG carrier 5,000 cbm |
4,753 |
2015 |
Japan |
TC(2) period |
$282,000 per month |
Feb-24 |
Feb-24 |
|
Dream Syrax |
LPG carrier 5,000 cbm |
5,158 |
2015 |
Japan |
TC(2) period |
$308,500 per month |
April-24 |
May-24 |
|
Dream Vermax |
LPG carrier 5,000 cbm |
5,155 |
2015 |
Japan |
TC(2) (3) period |
$314,950 per month |
Mar-25 |
Mar-26 |
|
(1) |
The vessel is currently participating in an unaffiliated tanker
pool specializing in the employment of Handysize tanker
vessels. |
| (2) |
TC stands for time charter. |
| (3) |
In accordance with the prevailing
charter party, on January 31, 2024, the vessel was fixed at a gross
charter rate equal to $318,000 per month for a period of minimum 12
to maximum 24 months, commencing March 22, 2024. |
Financial Results Overview:
Set forth below are selected financial and
operational data of our fleet for each of the three months and year
ended December 31, 2023 and 2022, respectively:
| |
Three Months Ended |
|
|
Year Ended |
| (Expressed in U.S.
dollars) |
|
December31, 2023(unaudited) |
|
December31, 2022(unaudited) |
|
|
December31, 2023(unaudited) |
|
December31, 2022(unaudited) |
| Total vessel revenues |
$ |
11,923,784 |
$ |
38,025,385 |
|
$ |
78,468,574 |
$ |
111,885,865 |
| Operating income |
$ |
26,421,190 |
$ |
25,340,834 |
|
$ |
136,882,020 |
$ |
51,592,737 |
| Net income and comprehensive
income |
$ |
28,226,648 |
$ |
25,081,412 |
|
$ |
140,636,993 |
$ |
49,926,383 |
| EBITDA(1) |
$ |
28,440,767 |
$ |
27,195,030 |
|
$ |
144,719,062 |
$ |
58,881,032 |
| Earnings (basic) per common
share |
$ |
1.41 |
$ |
2.65 |
|
$ |
8.69 |
$ |
5.28 |
| Earnings (diluted) per common
share |
$ |
0.56 |
$ |
0.62 |
|
$ |
2.87 |
$ |
1.17 |
(1) EBITDA is not recognized measure under U.S. GAAP.
Please refer to Appendix B of this release for the definition and
reconciliation of this measure to Net income, the most directly
comparable financial measure calculated and presented in accordance
with U.S. GAAP.
Consolidated Fleet Selected Financial
and Operational Data:
Set forth below are selected financial and
operational data of our fleet for each of the three months and year
ended December 31, 2023 and 2022, respectively, that we believe are
useful in analyzing trends in our results of operations.
| |
|
Three Months EndedDecember
31, |
|
|
Year EndedDecember 31, |
|
(Expressed in U.S. dollars except for operational
data) |
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
| Ownership Days (1)(7) |
|
681 |
|
|
736 |
|
|
|
2,876 |
|
|
3,115 |
|
| Available Days (2)(7) |
|
637 |
|
|
698 |
|
|
|
2,734 |
|
|
3,037 |
|
| Operating Days (3)(7) |
|
626 |
|
|
698 |
|
|
|
2,650 |
|
|
3,028 |
|
| Daily TCE Rate (4) |
$ |
16,599 |
|
$ |
49,768 |
|
|
$ |
27,075 |
|
$ |
27,187 |
|
| Fleet Utilization (5) |
|
98% |
|
|
100% |
|
|
|
97% |
|
|
100% |
|
| Daily vessel operating
expenses (6) |
$ |
6,662 |
|
$ |
7,884 |
|
|
$ |
7,331 |
|
$ |
6,969 |
|
|
(1) |
Ownership Days are the total number of calendar days in a period
during which we owned a vessel. |
| (2) |
Available Days are the Ownership
Days in a period less the aggregate number of days our vessels are
off-hire due to scheduled repairs, dry-dockings or special or
intermediate surveys. |
| (3) |
Operating Days are the Available
Days in a period after subtracting unscheduled off-hire and idle
days. |
| (4) |
Daily TCE Rate is not a
recognized measure under U.S. GAAP. Please refer to Appendix B for
the definition and reconciliation of this measure to Total vessel
revenues, the most directly comparable financial measure calculated
and presented in accordance with U.S. GAAP. |
| (5) |
Fleet Utilization is calculated
by dividing the Operating Days during a period by the number of
Available Days during that period. |
| (6) |
Daily vessel operating expenses
are calculated by dividing vessel operating expenses for the
relevant period by the Ownership Days for such period. |
| (7) |
Our definitions of Ownership
Days, Available Days, Operating Days, Fleet Utilization may not be
comparable to those reported by other companies. |
APPENDIX A
TORO CORP.
Unaudited Interim Condensed Consolidated
Statements of Comprehensive Income
(Expressed in U.S. Dollars—except for number of share
data)
| (In U.S. dollars except for
number of share data) |
|
Three Months EndedDecember
31, |
|
|
Year EndedDecember 31, |
|
|
|
2023 |
|
2022 |
|
|
2023 |
|
2022 |
| REVENUES |
|
|
|
|
|
|
|
|
|
|
Time charter revenues |
|
3,800,490 |
|
|
1,674,123 |
|
|
|
12,148,571 |
|
|
13,656,027 |
|
| Voyage charter revenues |
|
711,879 |
|
|
5,877,545 |
|
|
|
3,806,244 |
|
|
51,805,097 |
|
| Pool revenues |
|
7,411,415 |
|
|
30,473,717 |
|
|
|
62,513,759 |
|
|
46,424,741 |
|
| Total vessel
revenues |
$ |
11,923,784 |
|
$ |
38,025,385 |
|
|
$ |
78,468,574 |
|
$ |
111,885,865 |
|
| EXPENSES |
|
|
|
|
|
|
|
|
|
| Voyage expenses (including
commissions to related party) |
|
(1,349,942 |
) |
|
(3,287,440 |
) |
|
|
(4,444,716 |
) |
|
(29,319,414 |
) |
| Vessel operating expenses |
|
(4,536,522 |
) |
|
(5,802,842 |
) |
|
|
(21,084,635 |
) |
|
(21,708,290 |
) |
| General and administrative
expenses (including related party fees) |
|
(2,284,920 |
) |
|
(756,211 |
) |
|
|
(5,357,265 |
) |
|
(2,093,347 |
) |
| Management fees - related
parties |
|
(707,559 |
) |
|
(717,600 |
) |
|
|
(3,153,660 |
) |
|
(2,833,500 |
) |
| Depreciation and
amortization |
|
(1,380,296 |
) |
|
(1,853,726 |
) |
|
|
(6,839,702 |
) |
|
(7,294,476 |
) |
| (Provision)/ Recovery of
provision for doubtful accounts |
|
— |
|
|
(266,732 |
) |
|
|
266,732 |
|
|
(266,732 |
) |
| Gain on
sale of vessels |
|
24,756,645 |
|
|
— |
|
|
|
99,026,692 |
|
|
3,222,631 |
|
|
Operating income |
$ |
26,421,190 |
|
$ |
25,340,834 |
|
|
$ |
136,882,020 |
|
$ |
51,592,737 |
|
| Interest and finance costs,
net (including related party interest costs) (1) |
|
1,192,555 |
|
|
(97,518 |
) |
|
|
3,108,300 |
|
|
(699,992 |
) |
| Other expenses, net |
|
392 |
|
|
470 |
|
|
|
(23,493 |
) |
|
(6,181 |
) |
| Dividend income from related
party |
|
638,889 |
|
|
— |
|
|
|
1,020,833 |
|
|
— |
|
| Income taxes |
|
(26,378 |
) |
|
(162,374 |
) |
|
|
(350,667 |
) |
|
(960,181 |
) |
|
Net income and comprehensive income, net of
taxes |
$ |
28,226,648 |
|
$ |
25,081,412 |
|
|
$ |
140,636,993 |
|
$ |
49,926,383 |
|
| Dividend on Series A Preferred
Shares |
|
(357,778 |
) |
|
— |
|
|
|
(1,166,667 |
) |
|
— |
|
| Deemed dividend on Series A
Preferred Shares |
|
(752,604 |
) |
|
— |
|
|
|
(2,429,275 |
) |
|
— |
|
|
Net income attributable to common
shareholders |
$ |
27,116,266 |
|
$ |
25,081,412 |
|
|
$ |
137,041,051 |
|
$ |
49,926,383 |
|
| Earnings per common
share, basic |
$ |
1.41 |
|
$ |
2.65 |
|
|
$ |
8.69 |
|
$ |
5.28 |
|
| Earnings per common
share, diluted |
$ |
0.56 |
|
$ |
0.62 |
|
|
$ |
2.87 |
|
$ |
1.17 |
|
| Weighted average number of
common shares outstanding, basic: |
|
17,951,267 |
|
|
9,461,009 |
|
|
|
15,443,485 |
|
|
9,461,009 |
|
| Weighted average number of
common shares outstanding, diluted: |
|
49,026,754 |
|
|
40,536,496 |
|
|
|
48,659,725 |
|
|
42,677,249 |
|
(1) Includes interest and finance costs and interest
income, if any.
TORO CORP. Unaudited Condensed
Consolidated Balance
Sheets(Expressed in U.S. Dollars—except for number
of share data)
| |
|
December 31,2023 |
|
December 31,2022 |
| ASSETS |
|
|
|
|
| CURRENT
ASSETS: |
|
|
|
|
|
Cash and cash equivalents |
$ |
155,235,401 |
|
$ |
41,779,594 |
|
| Due from related parties |
|
3,923,315 |
|
|
558,327 |
|
| Other current assets |
|
5,976,852 |
|
|
12,425,386 |
|
|
Total current assets |
|
165,135,568 |
|
|
54,763,307 |
|
| |
|
|
|
|
| NON-CURRENT
ASSETS: |
|
|
|
|
| Vessels, net |
|
88,708,051 |
|
|
92,486,178 |
|
| Restricted cash |
|
350,000 |
|
|
700,000 |
|
| Due from related parties |
|
1,590,501 |
|
|
1,708,474 |
|
| Investment in related
party |
|
50,541,667 |
|
|
— |
|
| Other non-currents assets |
|
1,778,343 |
|
|
7,821,144 |
|
|
Total non-current assets |
|
142,968,562 |
|
|
102,715,796 |
|
|
Total assets |
|
308,104,130 |
|
|
157,479,103 |
|
| |
|
|
|
|
| LIABILITIES, MEZZANINE
EQUITY AND SHAREHOLDERS’ EQUITY |
|
|
|
|
| CURRENT
LIABILITIES: |
|
|
|
|
| Current portion of long-term
debt, net |
|
1,311,289 |
|
|
2,606,302 |
|
| Due to related parties |
|
315,000 |
|
|
— |
|
| Other current liabilities |
|
6,232,735 |
|
|
3,912,749 |
|
|
Total current liabilities |
|
7,859,024 |
|
|
6,519,051 |
|
| NON-CURRENT
LIABILITIES: |
|
|
|
|
| Long-term debt, net |
|
3,902,497 |
|
|
10,463,172 |
|
| Total non-current
liabilities |
|
3,902,497 |
|
|
10,463,172 |
|
|
Total liabilities |
|
11,761,521 |
|
|
16,982,223 |
|
| |
|
|
|
|
| MEZZANINE
EQUITY: |
|
|
|
|
| 1.00% Series A fixed rate
cumulative perpetual convertible preferred shares: 0 and 140,000
shares issued and outstanding as of December 31, 2022, and December
31, 2023, respectively, aggregate liquidation preference of $0 and
$140,000,000 as of December 31, 2022 and December 31, 2023,
respectively. |
|
119,601,410 |
|
|
— |
|
|
Total mezzanine equity |
|
119,601,410 |
|
|
— |
|
| |
|
|
|
|
| SHAREHOLDERS’
EQUITY: |
|
|
|
|
| Former Net Parent
Company investment |
|
— |
|
|
140,496,912 |
|
| Common shares, $0.001 par
value; 1,000 and 3,900,000,000 shares authorized; 1,000 and
19,021,758 shares issued; 1,000 and 18,978,409 shares (net of
treasury shares) outstanding as of December 31, 2022, and December
31, 2023 respectively. |
|
19,022 |
|
|
1 |
|
| Preferred shares, $0.001 par
value: 0 and 100,000,000 shares authorized; Series B preferred
shares: 0 and 40,000 shares issued and outstanding as of December
31,2022 and December 31, 2023, respectively. |
|
40 |
|
|
— |
|
| Additional paid-in
capital |
|
57,244,290 |
|
|
— |
|
| Treasury shares; 0 and 43,349
shares as of December 31, 2022 and 2023, respectively. |
|
(223,840 |
) |
|
— |
|
| Due from stockholder |
|
— |
|
|
(1 |
) |
| Retained Earnings/(Accumulated
deficit) |
|
119,701,687 |
|
|
(32 |
) |
|
Total shareholders’ equity |
|
176,741,199 |
|
|
140,496,880 |
|
|
Total liabilities, mezzanine equity and shareholders’
equity |
$ |
308,104,130 |
|
$ |
157,479,103 |
|
TORO CORP.Unaudited
Interim Condensed Consolidated Statements of Cash
Flows
| (Expressed in U.S.
Dollars) |
Year Ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
| Cash Flows (used
in)/provided by Operating Activities : |
|
|
|
|
| Net income |
$ |
140,636,993 |
|
$ |
49,926,383 |
|
| Adjustments to
reconcile net income to net cash (used in)/provided by Operating
activities: |
|
|
|
|
| Depreciation and
amortization |
|
6,839,702 |
|
|
7,294,476 |
|
| Amortization of deferred
finance charges |
|
137,112 |
|
|
119,731 |
|
| Gain on sale of vessels |
|
(99,026,692 |
) |
|
(3,222,631 |
) |
| Provision for doubtful
accounts |
|
— |
|
|
266,732 |
|
| Stock based compensation
cost |
|
1,272,698 |
|
|
— |
|
| Changes in operating
assets and liabilities: |
|
|
|
|
| Accounts receivable trade,
net |
|
6,484,291 |
|
|
(6,781,154 |
) |
| Inventories |
|
633,014 |
|
|
2,244,286 |
|
| Due from/to related
parties |
|
(3,788,681 |
) |
|
(3,935,077 |
) |
| Prepaid expenses and other
assets |
|
4,211,685 |
|
|
(4,762,742 |
) |
| Other deferred charges |
|
— |
|
|
25,335 |
|
| Accounts payable |
|
1,492,412 |
|
|
1,304,711 |
|
| Accrued liabilities |
|
381,414 |
|
|
1,512,592 |
|
| Deferred revenue |
|
310,000 |
|
|
(547,939 |
) |
| Dry-dock costs paid |
|
(3,457,629 |
) |
|
(1,906,526 |
) |
| Net Cash provided by
Operating Activities |
|
56,126,319 |
|
|
41,538,177 |
|
| |
|
|
|
|
| Cash flow (used
in)/provided by Investing Activities: |
|
|
|
|
| Vessel acquisitions and other
vessel improvements |
|
(72,237,732 |
) |
|
(852,603 |
) |
| Investment in related
party |
|
(50,000,000 |
) |
|
— |
|
| Net proceeds from sale of
vessel |
|
172,943,983 |
|
|
12,641,284 |
|
| Net cash provided by
Investing Activities |
|
50,706,251 |
|
|
11,788,681 |
|
| |
|
|
|
|
| Cash flows (used
in)/provided by Financing Activities: |
|
|
|
|
| Net increase/ (decrease) in
Former Parent Company Investment |
|
211,982 |
|
|
(13,460,675 |
) |
| Issuance of Series B preferred
shares |
|
40 |
|
|
— |
|
| Gross proceeds from issuance
of common shares pursuant to private placement |
|
19,465,000 |
|
|
— |
|
| Common shares issuance
expenses pursuant to private placement |
|
(817,764 |
) |
|
|
| Payment of Dividend on Series
A Preferred Shares |
|
(851,667 |
) |
|
— |
|
| Repayment of long-term
debt |
|
(7,992,800 |
) |
|
(3,050,000 |
) |
| Payment for repurchase of
common shares |
|
(1,046,908 |
) |
|
— |
|
| Payments related to
Spin-Off |
|
(2,694,646 |
) |
|
— |
|
| Net cash provided by /
(used in) Financing Activities |
|
6,273,237 |
|
|
(16,510,675 |
) |
| |
|
|
|
|
| Net increase in cash,
cash equivalents, and restricted cash |
|
113,105,807 |
|
|
36,816,183 |
|
| Cash, cash equivalents
and restricted cash at the beginning of the period |
|
42,479,594 |
|
|
5,663,411 |
|
| Cash, cash equivalents
and restricted cash at the end of the period |
$ |
155,585,401 |
|
$ |
42,479,594 |
|
APPENDIX B
Non-GAAP Financial
Information
Daily Time Charter (“TCE”)
Rate. The Daily Time Charter Equivalent Rate (“Daily TCE
Rate”), is a measure of the average daily revenue performance of a
vessel. The Daily TCE Rate is not a measure of financial
performance under U.S. GAAP (i.e., it is a non-GAAP measure) and
should not be considered as an alternative to any measure of
financial performance presented in accordance with U.S. GAAP. We
calculate Daily TCE Rate by dividing total revenues (time charter
and/or voyage charter revenues, and/or pool revenues, net of
charterers’ commissions), less voyage expenses, by the number of
Available Days during that period. Under a time charter, the
charterer pays substantially all the vessel voyage related
expenses. However, we may incur voyage related expenses when
positioning or repositioning vessels before or after the period of
a time or other charter, during periods of commercial waiting time
or while off-hire during dry-docking or due to other unforeseen
circumstances. Under voyage charters, the majority of voyage
expenses are generally borne by us whereas for vessels in a pool,
such expenses are borne by the pool operator. The Daily TCE Rate is
a standard shipping industry performance measure used primarily to
compare period-to-period changes in a company’s performance and,
management believes that the Daily TCE Rate provides meaningful
information to our investors since it compares daily net earnings
generated by our vessels irrespective of the mix of charter types
(e.g., time charter, voyage charter, pools or other) under which
our vessels are employed between the periods while it further
assists our management in making decisions regarding the deployment
and use of our vessels and in evaluating our financial performance.
Our calculation of the Daily TCE Rates may be different from and
may not be comparable to that reported by other companies.
The following table reconciles the calculation
of the Daily TCE Rate for our fleet to Total vessel revenues, the
most directly comparable U.S. GAAP financial measure, for the
periods presented (amounts in U.S. dollars, except for Available
Days):
| |
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
(In U.S. dollars, except for Available Days) |
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
| Total vessel revenues |
$ |
11,923,784 |
|
$ |
38,025,385 |
|
|
$ |
78,468,574 |
|
$ |
111,885,865 |
|
| Voyage expenses -including
commissions to related party |
|
(1,349,942 |
) |
|
(3,287,440 |
) |
|
|
(4,444,716 |
) |
|
(29,319,414 |
) |
|
TCE revenues |
$ |
10,573,842 |
|
$ |
34,737,945 |
|
|
$ |
74,023,858 |
|
$ |
82,566,451 |
|
| Available Days |
|
637 |
|
|
698 |
|
|
|
2,734 |
|
|
3,037 |
|
|
Daily TCE Rate |
$ |
16,599 |
|
$ |
49,768 |
|
|
$ |
27,075 |
|
$ |
27,187 |
EBITDA. EBITDA is not a measure
of financial performance under U.S. GAAP, does not represent and
should not be considered as an alternative to net income, operating
income, cash flow from operating activities or any other measure of
financial performance presented in accordance with U.S. GAAP. We
define EBITDA as earnings before interest and finance costs (if
any), net of interest income, taxes (when incurred), depreciation
and amortization of deferred dry-docking costs. EBITDA is used as a
supplemental financial measure by management and external users of
financial statements to assess our operating performance. We
believe that EBITDA assists our management by providing useful
information that increases the comparability of our operating
performance from period to period and against the operating
performance of other companies in our industry that provide EBITDA
information. This increased comparability is achieved by excluding
the potentially disparate effects between periods or companies of
interest, other financial items, depreciation and amortization and
taxes, which items are affected by various and possibly changing
financing methods, capital structure and historical cost basis and
which items may significantly affect net income between periods. We
believe that including EBITDA as a measure of operating performance
benefits investors in (a) selecting between investing in us and
other investment alternatives and (b) monitoring our ongoing
financial and operational strength. EBITDA as presented below may
be different from and may not be comparable to similarly titled
measures of other companies. The following table reconciles EBITDA
to Net Income, the most directly comparable U.S. GAAP financial
measure, for the periods presented:
Reconciliation of EBITDA to Net
Income
| |
|
Three Months EndedDecember 31, |
|
|
Year EndedDecember 31, |
|
(In U.S. dollars) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
| Net
Income |
$ |
28,226,648 |
|
$ |
25,081,412 |
|
$ |
140,636,993 |
|
$ |
49,926,383 |
| Depreciation and
amortization |
|
1,380,296 |
|
|
1,853,726 |
|
|
6,839,702 |
|
|
7,294,476 |
| Interest and finance costs,
net (1) |
|
(1,192,555 |
) |
|
97,518 |
|
|
(3,108,300 |
) |
|
699,992 |
| US source income taxes |
|
26,378 |
|
|
162,374 |
|
|
350,667 |
|
|
960,181 |
|
EBITDA |
$ |
28,440,767 |
|
$ |
27,195,030 |
|
$ |
144,719,062 |
|
$ |
58,881,032 |
(1) Includes interest and finance costs and interest
income, if any.Cautionary Statement Regarding
Forward-Looking Statements
Matters discussed in this press release may
constitute forward-looking statements. We intend such
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in Section 27A
of the Securities Act of 1933, as amended (the “Securities Act”)
and Section 21E of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Forward-looking statements include statements
concerning plans, objectives, goals, strategies, future events or
performance (including the expected deliveries of vessels by us
discussed herein and with respect to our share repurchase program),
and underlying assumptions and other statements, which are other
than statements of historical facts. We are including this
cautionary statement in connection with this safe harbor
legislation. The words “believe”, “anticipate”, “intend”,
“estimate”, “forecast”, “project”, “plan”, “potential”, “will”,
“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 current or 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 forward-looking statements, including 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 our ability to realize the
expected benefits of vessel acquisitions and the effect of any
change in our fleet’s size or composition, increased transactions
costs and other adverse effects (such as lost profit) due to any
failure to consummate any sale of our vessels, the effects of the
Spin-Off, our business strategy, shipping markets conditions and
trends, our relationships with our current and future service
providers and customers, our ability to borrow under existing or
future debt agreements or to refinance our debt on favorable terms
and our ability to comply with the covenants contained therein, our
continued ability to enter into time charters, voyage charters or
pool arrangements with existing and new customers and pool
operators and to re-charter our vessels upon the expiry of the
existing charters, changes in our operating and capitalized
expenses, our ability to fund future capital expenditures and
investments in the acquisition and refurbishment of our vessels,
instances of off-hire, future sales of our securities in the public
market and our ability to maintain compliance with applicable
listing standards, volatility in our share price, potential
conflicts of interest involving members of our board of directors,
senior management and certain of our service providers that are
related parties, general domestic and international political
conditions or events (including armed conflicts, such as the war in
Ukraine and the conflict in the Middle East, acts of piracy or
maritime aggression, such as recent maritime incidents involving
vessels in and around the Red Sea, “trade wars”, global public
health threats and major outbreaks of disease), changes in seaborne
and other transportation (including as a result of the maritime
incidents in and around the Red Sea), changes in governmental rules
and regulations or actions taken by regulatory authorities, the
impact of adverse weather and natural disasters, accidents or the
occurrence of other events related to the operational risks
associated with transporting crude oil and/or refined petroleum
products and any other factors described in our filings with the
SEC.
The information set forth herein speaks only as
of the date hereof, and we disclaim any intention or obligation to
update any forward‐looking statements as a result of developments
occurring after the date of this communication, except to the
extent required by applicable law. New factors emerge from time to
time, and it is not possible for us to predict all or any of these
factors. Further, we cannot assess the impact of each such factor
on our business or the extent to which any factor, or combination
of factors, may cause actual results to be materially different
from those contained in any forward-looking statement. Please see
our filings with the Securities Exchange Commission for a more
complete discussion of these foregoing and other risks and
uncertainties. These factors and the other risk factors described
in this press release are not necessarily all of the important
factors that could cause actual results or developments to differ
materially from those expressed in any of our forward-looking
statements. Given these uncertainties, prospective investors are
cautioned not to place undue reliance on such forward-looking
statements.
CONTACT DETAILS For further
information please contact:
Petros PanagiotidisToro Corp.Email:
ir@torocorp.com
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