Global Ship Lease, Inc. (NYSE:GSL), a containership charter owner,
announced today its unaudited results for the three months and six
months ended June 30, 2017.
Second Quarter and Year To Date Highlights -
Reported operating revenues of $40.3 million for the second quarter
2017. Revenue for the six months ended June 30, 2017 was $79.9
million
- Reported net income available to common shareholders of $6.8
million for the second quarter 2017. For the six months ended
June 30, 2017, net income was $13.6 million
- Generated $28.1 million of Adjusted EBITDA(1) for the second
quarter 2017. Adjusted EBITDA for the six months ended June
30, 2017 was $56.1 million
- Normalized net income(1) was $7.3 million for second quarter
2017. Normalized net income was $14.1 million for the six months
ended June 30, 2017
- Purchased and cancelled on April 21, 2017, $19.5 million
principal amount 10.0% First Priority Secured Notes due 2019.
Net debt to last 12 months Adjusted EBITDA was 3.1 times at June
30, 2017, down from 3.3 times at December 31, 2016
Ian Webber, Chief Executive Officer of Global Ship Lease,
stated, “During the second quarter of 2017, we remained focused on
generating strong cashflows from stable, fixed-rate contracts with
industry-leading counterparties. The value and consistency of this
core strategy was once again evident in our financial results for
the quarter.”
Mr. Webber added, “Looking forward, we expect continued firming
in the charter market over time, driven by discipline in the
placement of new orders, an orderbook heavily skewed towards the
largest vessels, elevated scrapping consisting almost entirely of
the mid-sized and smaller vessel classes where we focus, and better
than expected demand growth. We remain encouraged by the
upward movement of the spot charter market throughout 2017 and
believe that this should benefit those of our vessels due to become
open later this year and early next. By continuing to maximize
vessel utilization with top-tier counterparties, actively manage
costs, and opportunistically pursue further deleveraging of our
stable balance sheet, we believe that Global Ship Lease is well
positioned to create long-term value for our shareholders amidst an
improving market environment.”
SELECTED FINANCIAL DATA – UNAUDITED
(thousands of U.S. dollars)
|
Three |
Three |
Six |
Six |
|
months ended |
months
ended |
months ended |
months ended |
|
June 30, 2017 |
June
30, 2016 |
June 30, 2017 |
June
30, 2016 |
|
|
|
|
|
Revenue |
40,259 |
41,333 |
79,901 |
83,943 |
Operating
Income |
18,531 |
17,921 |
36,965 |
36,306 |
Net Income
for Common Shareholders |
6,824 |
6,043 |
13,618 |
10,600 |
Adjusted
EBITDA (1) |
28,072 |
28,798 |
56,106 |
58,118 |
Normalized
Net Income (1) |
7,344 |
5,632 |
14,138 |
11,061 |
|
|
|
|
|
(1) Adjusted EBITDA and Normalized net income are non-US
Generally Accepted Accounting Principles (US GAAP) measures, as
explained further in this press release, and are considered by
Global Ship Lease to be useful measures of its performance.
Reconciliations of such non-GAAP measures to the interim unaudited
financial information are provided in this Earnings Release.
Revenue and Utilization The 18-vessel fleet generated revenue
from fixed-rate, mainly long-term time, charters of $40.3 million
in the three months ended June 30, 2017, down $1.0 million (or
2.6%) on revenue of $41.3 million for the comparative period in
2016, due mainly to reduced revenue as a consequence of the
amendments to the charters of Marie Delmas and Kumasi effective
August 1, 2016, offset by an overall reduction in offhire from a
total of 53 days in the three months ended June 30, 2016 to 42 days
in the 2017 period. There were 1,638 ownership days in the
quarter, the same as in the comparative period in 2016. The 42 days
of offhire in the three months ended June 30, 2017 were
attributable to 15 days for scheduled dry-dockings and 27 days
unplanned offhire, primarily related to a vessel grounding in late
March, giving an overall utilization of 97.4%. The affected vessel
underwent repairs and was successfully returned to service. In the
comparative period of 2016, there were 51 days of planned offhire
for scheduled dry-dockings and two days of unplanned offhire,
giving a utilization of 96.8%.
For the six months ended June 30, 2017, revenue was $79.9
million, down $4.0 million (or 4.8%) on revenue of $83.9 million in
the comparative period, mainly due to the amendments to the
charters of Marie Delmas and Kumasi effective August 1, 2016 and an
increase in offhire to a total of 92 days in the six months ended
June 30, 2017 from 53 in the comparative period.
The table below shows fleet utilization for the three and six
months ended June 30, 2017 and 2016, and for the years ended
December 31, 2016, 2015, 2014 and 2013.
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
Six months ended |
|
|
|
|
June 30, |
June 30, |
June 30, |
June 30, |
|
Dec 31, |
Dec 31, |
Dec 31, |
Dec 31, |
Days |
2017 |
|
2016 |
|
2017 |
|
2016 |
|
|
2016 |
|
2015 |
|
2014 |
|
2013 |
|
|
|
|
|
|
|
|
|
|
|
Ownership days |
1,638 |
|
1,638 |
|
3,258 |
|
3,276 |
|
|
6,588 |
|
6,893 |
|
6,270 |
|
6,205 |
|
Planned offhire -
scheduled dry-dock |
(15 |
) |
(51 |
) |
(62 |
) |
(51 |
) |
|
(100 |
) |
(9 |
) |
(48 |
) |
(21 |
) |
Unplanned offhire |
(27 |
) |
(2 |
) |
(30 |
) |
(2 |
) |
|
(3 |
) |
(7 |
) |
(12 |
) |
(7 |
) |
Idle time |
0 |
|
0 |
|
0 |
|
0 |
|
|
0 |
|
(13 |
) |
(64 |
) |
0 |
|
Operating days |
1,596 |
|
1,585 |
|
3,166 |
|
3,223 |
|
|
6,485 |
|
6,864 |
|
6,146 |
|
6,177 |
|
|
|
|
|
|
|
|
|
|
|
Utilization |
97.4 |
% |
96.8 |
% |
97.2 |
% |
98.4 |
% |
|
98.4 |
% |
99.6 |
% |
98.0 |
% |
99.5 |
% |
In the three months ended June 30, 2017, we completed one
regulatory dry-docking. There have been a total of four regulatory
dry-dockings year to date. One further regulatory dry-docking is
scheduled in 2017. Two dry-dockings were completed in the
three months ended June 30, 2016, and one further dry-docking was
substantially completed. There were a total of six
dry-dockings in 2016.
Vessel Operating Expenses Vessel operating expenses, which
include costs of crew, lubricating oil, spares and insurance, as
well as bunker fuel when a vessel is offhire or without a charter,
were $10.9 million for the three months ended June 30, 2017.
The average cost per ownership day in the quarter was $6,635,
compared to $6,909 for the comparative period, down $274 or
4.0%. The reductions occurred across several cost categories,
most prominently from lower consumption of lubricating oil, reduced
insurance costs on renewals and lower expenditure on repairs and
maintenance.
For the six months ended June 30, 2017, vessel operating
expenses were $21.3 million, or an average of $6,531 per day,
compared to $22.7 million in the comparative period, or $6,935 per
day.
Depreciation Depreciation for the three months ended June 30,
2017 was $9.5 million, compared to $10.9 million in the second
quarter 2016, with the reduction being due to the effect of lower
book values for a number of vessels following impairment write
downs taken in the third and fourth quarters 2016.
Depreciation for the six months ended June 30, 2017 was $19.1
million, compared to $21.8 million in the comparative period, with
the reduction being due to the reason noted above.
General and Administrative Costs General and administrative
costs were $1.3 million in the three months ended June 30, 2017,
the same as in the second quarter of 2016.
For the six months ended June 30, 2017, general and
administrative costs were $2.6 million, compared to $3.3 million in
the comparative period in 2016, which includes higher legal and
professional fees in the three months ended March 31, 2016.
Other Operating Income
Other operating income in the three months ended June 30, 2017
was $6,000, compared to $63,000 in the second quarter of 2016.
For the six months ended June 30, 2017, other operating income
was $48,000, compared to $144,000 in the comparative
period.
Adjusted EBITDA
As a result of the above, Adjusted EBITDA was $28.1 million for
the three months ended June 30, 2017, down from $28.8 million for
the three months ended June 30, 2016.
Adjusted EBITDA for the six months ended June 30, 2017 was $56.1
million, compared to $58.1 million for the comparative period.
Interest Expense Debt at June 30, 2017 comprised amounts
outstanding on our Notes, the revolving credit facility and the
secured term loan.
Interest expense for the three months ended June 30, 2017, was
$11.0 million, compared to $11.1 million for the three months ended
June 30, 2016. The reduction of $1.0 million interest paid on
our 10.0% Notes on lower amounts outstanding was offset by $0.5
million charges, including premium paid, associated with the excess
cashflow offer which retired $19.5 million principal amount of our
10% Notes on April 21, 2017, whereas second quarter 2016 included a
$0.5 million gain realized in May 2016 on the purchase in the open
market of $4.2 million principal amount of the
Notes.
For the six months ended June 30, 2017, interest expense was
$22.0 million, compared to $24.2 million for the six months ended
June 30, 2016. The reduction is mainly due to lower interest
on the lower amount outstanding of our 10% Notes.
Interest income for the three months ended June 30, 2017 was
$0.1 million, compared to $38,000 in the comparative quarter in
2016.
Interest income for the six months ended June 30, 2017 was $0.2
million, compared to $0.1 million in the comparative period in
2016.
Taxation
Taxation for the three months ended June 30, 2017 was $6,000,
compared to $9,000 in the second quarter of 2016.
Taxation for the six months ended June 30, 2017 was $16,000,
compared to $15,000 for the comparative period in 2016.
Earnings Allocated to Preferred SharesThe Series B preferred
shares, issued on August 20, 2014, carry a coupon of 8.75%, the
cost of which for the three months ended June 30, 2017 was $0.8
million, the same as in the comparative period. The cost was
$1.5 million in the six months ended June 30, 2017, again the same
as in the comparative period.
Net Income Available to Common Shareholders
Net income available to common shareholders for the three months
ended June 30, 2017 was $6.8 million, compared to $6.0 million in
the second quarter 2016.
Normalized net income, which excludes the premium paid on the
purchase of our 10% Notes in April 2017 under the excess cashflow
offer and associated charges, was $7.3 million for the three months
ended June 30, 2017, compared to $5.6 million in the second quarter
of 2016.
Net income available to common shareholders was $13.6 million
for the six months ended June 30, 2017, compared to $10.6 million
in the comparative period. Normalized net income for the six
months ended June 30, 2017, was $14.1 million. Normalized net
income for the six months ended June 30, 2016 which excludes the
gain on the purchase of 10% Notes in May 2016 and the premium
associated with the tender offer for 10% Notes completed in March
2016, and associated charges, was $11.1 million.
Fleet
The following table provides information about the on-the-water
fleet of 18 vessels as at June 30, 2017. 15 vessels are chartered
to CMA CGM, and three are chartered to OOCL.
|
|
|
|
Remaining |
Earliest |
Daily |
|
|
|
|
Charter |
Charter |
Charter |
Vessel |
Capacity |
Year |
Purchase |
Term (2) |
Expiry |
Rate |
Name |
in TEUs (1) |
Built |
by GSL |
(years) |
Date |
$ |
CMA CGM Matisse |
2,262 |
1999 |
Dec
2007 |
2.50 |
Sept
21, 2019 |
15,300 |
CMA CGM Utrillo |
2,262 |
1999 |
Dec
2007 |
2.50 |
Sept
11, 2019 |
15,300 |
Delmas Keta |
2,207 |
2003 |
Dec
2007 |
0.50 |
Sept
20, 2017 |
18,465 |
Julie Delmas |
2,207 |
2002 |
Dec
2007 |
0.50 |
Sept
11, 2017 |
18,465 |
Kumasi |
2,207 |
2002 |
Dec
2007 |
1.50 -
3.50(3) |
Nov
16, 2018 |
13,000(3) |
Marie Delmas |
2,207 |
2002 |
Dec
2007 |
1.50 -
3.50(3) |
Nov
16, 2018 |
13,000(3) |
CMA CGM La Tour |
2,272 |
2001 |
Dec
2007 |
2.50 |
Sept
20, 2019 |
15,300 |
CMA CGM Manet |
2,272 |
2001 |
Dec
2007 |
2.50 |
Sept
7, 2019 |
15,300 |
CMA CGM Alcazar |
5,089 |
2007 |
Jan
2008 |
3.50 |
Oct
18, 2020 |
33,750 |
CMA CGM Château
d’If |
5,089 |
2007 |
Jan
2008 |
3.50 |
Oct
11, 2020 |
33,750 |
CMA CGM Thalassa |
11,040 |
2008 |
Dec
2008 |
8.50 |
Oct 1,
2025 |
47,200 |
CMA CGM Jamaica |
4,298 |
2006 |
Dec
2008 |
5.50 |
Sept
17, 2022 |
25,350 |
CMA CGM Sambhar |
4,045 |
2006 |
Dec
2008 |
5.50 |
Sept
16, 2022 |
25,350 |
CMA CGM America |
4,045 |
2006 |
Dec
2008 |
5.50 |
Sept
19, 2022 |
25,350 |
CMA CGM Berlioz |
6,621 |
2001 |
Aug
2009 |
4.25 |
May
28, 2021 |
34,000 |
OOCL Tianjin |
8,063 |
2005 |
Oct
2014 |
0.50 |
Oct
28, 2017 |
34,500 |
OOCL Qingdao |
8,063 |
2004 |
Mar
2015 |
0.75 |
Mar
11, 2018 |
34,500 |
OOCL Ningbo |
8,063 |
2004 |
Sep
2015 |
1.25 |
Sep
17, 2018 |
34,500 |
(1) Twenty-foot Equivalent Units. |
|
|
|
|
|
(2) As at June 30, 2017. Plus or minus 90 days,
other than (i) OOCL Tianjin which is between October 28, 2017 and
January 28, 2018, (ii) OOCL Qingdao which is between March 11, 2018
and June 11, 2018, and (iii) OOCL Ningbo which is between September
17, 2018 and December 17, 2018, all at charterer’s option.
(3) The charters for Kumasi and Marie Delmas were amended in
July 2016. The charter rate is $13,000 per day until
September 14, 2017 for Marie Delmas and September 21, 2017 for
Kumasi. Thereafter, the daily rate is $9,800. The
earliest possible re-delivery date is shown in the table, taking
account of the Company exercising its option to extend the charters
through December 31, 2018 plus or minus 45 days. The Company
has two further consecutive options to extend the charters, at
$9,800 per day, which, if exercised, would extend the earliest
re-delivery date to October 2, 2020. |
Conference Call and Webcast Global Ship Lease
will hold a conference call to discuss the Company's results for
the three months ended June 30, 2017 today, Monday July 31, 2017 at
10:30 a.m. Eastern Time. There are two ways to access the
conference call:
(1) Dial-in: (877) 445-2556 or (908)
982-4670; Passcode: 56081709
Please dial in at least 10 minutes prior to 10:30 a.m. Eastern
Time to ensure a prompt start to the call. (2) Live Internet
webcast and slide presentation: http://www.globalshiplease.com
If you are unable to participate at this time, a
replay of the call will be available through Wednesday, August 16,
2017 at (855) 859-2056 or (404) 537-3406. Enter the code 56081709
to access the audio replay. The webcast will also be archived on
the Company’s website: http://www.globalshiplease.com.
Annual Report on Form 20F
Global Ship Lease, Inc has filed its Annual Report for 2016 with
the Securities and Exchange Commission. A copy of the report
can be found under the Investor Relations section (Annual Reports)
of the Company’s website at
http://www.globalshiplease.com Shareholders may request
a hard copy of the audited financial statements free of charge by
contacting the Company at info@globalshiplease.com or by writing to
Global Ship Lease, Inc, care of Global Ship Lease Services Limited,
Portland House, Stag Place, London SW1E 5RS or by telephoning +44
(0) 207 869 8806.
About Global Ship Lease
Global Ship Lease is a containership charter owner. Incorporated
in the Marshall Islands, Global Ship Lease commenced operations in
December 2007 with a business of owning and chartering out
containerships under mainly long-term, fixed-rate charters to top
tier container liner companies.Global Ship Lease owns 18 vessels
with a total capacity of 82,312 TEU and an average age, weighted by
TEU capacity, at June 30, 2017 of 12.5 years. All 18 vessels are
currently fixed on time charters, 15 of which are with CMA CGM. The
average remaining term of the charters at June 30, 2017 is 3.1
years or 3.5 years on a weighted basis.
Reconciliation of Non-U.S. GAAP Financial Measures
A. Adjusted EBITDA
Adjusted EBITDA represents net income before interest income and
expense including amortization of deferred finance costs, realized
and unrealized gain (loss) on derivatives, income taxes,
depreciation and amortization. Adjusted EBITDA is a non-US
GAAP quantitative measure used to assist in the assessment of the
Company's ability to generate cash from its operations. We
believe that the presentation of Adjusted EBITDA is useful to
investors because it is frequently used by securities analysts,
investors and other interested parties in the evaluation of
companies in our industry. Adjusted EBITDA is not defined in
US GAAP and should not be considered to be an alternate to Net
income or any other financial metric required by such accounting
principles.
ADJUSTED EBITDA - UNAUDITED
(thousands of U.S.
dollars) |
|
|
|
Three |
Three |
Six |
Six |
|
|
months |
months |
months |
months |
|
|
ended |
ended |
ended |
ended |
|
|
June 30, |
June 30, |
June 30, |
June 30, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
|
|
|
|
|
|
Net income
available to Common Shareholders |
6,824 |
|
6,043 |
|
13,618 |
|
10,600 |
|
|
|
|
|
|
|
Adjust: |
Depreciation |
9,541 |
|
10,877 |
|
19,141 |
|
21,812 |
|
|
Interest
income |
(90 |
) |
(38 |
) |
(183 |
) |
(82 |
) |
|
Interest
expense |
11,026 |
|
11,142 |
|
21,983 |
|
24,242 |
|
|
Income
tax |
6 |
|
9 |
|
16 |
|
15 |
|
|
Earnings
allocated to preferred shares |
765 |
|
765 |
|
1,531 |
|
1,531 |
|
|
|
|
|
|
|
Adjusted
EBITDA |
28,072 |
|
28,798 |
|
56,106 |
|
58,118 |
|
B. Normalized net income
Normalized net income represents net income adjusted for the
premium paid on the tender offer together with the related
accelerated amortization of deferred financing costs and original
issue discount. Normalized net income is a non-GAAP quantitative
measure which we believe will assist investors and analysts who
often adjust reported net income for non-operating items that do
not affect operating performance or operating cash generated.
Normalized net income is not defined in US GAAP and should not be
considered to be an alternate to net income or any other financial
metric required by such accounting principles.
NORMALIZED NET INCOME
- UNAUDITED |
|
|
|
(thousands
of U.S. dollars) |
|
|
|
Three |
Three |
Six |
Six |
|
|
months |
months |
months |
months |
|
|
ended |
ended |
ended |
ended |
|
|
June
30, |
June 30, |
June
30, |
June 30, |
|
|
2017 |
2016 |
|
2017 |
2016 |
|
|
|
|
|
|
|
Net income
available to Common Shareholders |
6,824 |
6,043 |
|
13,618 |
10,600 |
|
|
|
|
|
|
|
Adjust: |
Gain on purchase of
Notes |
--- |
(452 |
) |
--- |
(452 |
) |
|
Premium paid on tender
offer for Notes |
390 |
--- |
|
390 |
533 |
|
|
Accelerated write off
of deferred financing charges related to purchase and tender
offer |
61 |
10 |
|
61 |
90 |
|
|
Accelerated write off
of original issue discount related to purchase and tender
offer |
69 |
31 |
|
69 |
290 |
|
|
|
|
|
|
|
Normalized
net income |
7,344 |
5,632 |
|
14,138 |
11,061 |
|
Safe Harbor Statement This communication
contains forward-looking statements. Forward-looking statements
provide Global Ship Lease's current expectations or forecasts of
future events. Forward-looking statements include statements about
Global Ship Lease's expectations, beliefs, plans, objectives,
intentions, assumptions and other statements that are not
historical facts. Words or phrases such as "anticipate," "believe,"
"continue," "estimate," "expect," "intend," "may," "ongoing,"
"plan," "potential," "predict," "project," "will" or similar words
or phrases, or the negatives of those words or phrases, may
identify forward-looking statements, but the absence of these words
does not necessarily mean that a statement is not forward-looking.
These forward-looking statements are based on assumptions that may
be incorrect, and Global Ship Lease cannot assure you that these
projections included in these forward-looking statements will come
to pass. Actual results could differ materially from those
expressed or implied by the forward-looking statements as a result
of various factors. The risks and uncertainties include, but are
not limited to:
• future operating or financial results; •
expectations regarding the strength of future growth of the
container shipping industry, including the rates of annual demand
and supply growth; • the financial condition of CMA CGM (the
company’s principal charterer and main source of operating revenue)
and other charterers and their ability to pay charterhire in
accordance with the charters;• the overall health and
condition of the U.S. and global financial markets;• Global
Ship Lease’s financial condition and liquidity, including its
ability to obtain additional financing to fund capital
expenditures, vessel acquisitions and for other general corporate
purposes and its ability to meet its financial covenants and repay
its borrowings; • Global Ship Lease’s expectations
relating to dividend payments and forecasts of its ability to make
such payments including the availability of cash and the impact of
constraints under its first priority secured notes; • future
acquisitions, business strategy and expected capital spending;
• operating expenses, availability of key employees, crew,
number of off-hire days, dry-docking and survey requirements, costs
of regulatory compliance, insurance costs and general and
administrative costs; • general market conditions and
shipping industry trends, including charter rates and factors
affecting supply and demand; • assumptions regarding interest
rates and inflation; • change in the rate of growth of global
and various regional economies; • risks incidental to vessel
operation, including piracy, discharge of pollutants and vessel
accidents and damage including total or constructive total loss;
• estimated future capital expenditures needed to preserve
Global Ship Lease’s capital base; • Global Ship Lease’s
expectations about the availability of vessels to purchase, the
time that it may take to construct new vessels, or the useful lives
of its vessels; • Global Ship Lease’s continued ability to
enter into or renew charters including the re-chartering of vessels
on the expiry of existing charters, or to secure profitable
employment for its vessels in the spot market; • the
continued performance of existing charters; • Global Ship
Lease’s ability to capitalize on management’s and directors’
relationships and reputations in the containership industry to its
advantage; • changes in governmental and classification
societies’ rules and regulations or actions taken by regulatory
authorities; • expectations about the availability of
insurance on commercially reasonable terms; • unanticipated
changes in laws and regulations; and• potential liability
from future litigation.
Forward-looking statements are subject to known and unknown
risks and uncertainties and are based on potentially inaccurate
assumptions that could cause actual results to differ materially
from those expected or implied by the forward-looking statements.
Global Ship Lease's actual results could differ materially from
those anticipated in forward-looking statements for many reasons
specifically as described in Global Ship Lease's filings with the
SEC. Accordingly, you should not unduly rely on these
forward-looking statements, which speak only as of the date of this
communication. Global Ship Lease undertakes no obligation to
publicly revise any forward-looking statement to reflect
circumstances or events after the date of this communication or to
reflect the occurrence of unanticipated events. You should,
however, review the factors and risks Global Ship Lease describes
in the reports it will file from time to time with the SEC after
the date of this communication.
Global Ship Lease, Inc. |
|
Interim Unaudited Consolidated
Statements of Income |
|
(Expressed in thousands of U.S. dollars except share
data) |
|
|
|
Three months ended June 30, |
Six months ended June 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Revenues |
|
|
|
|
|
Time charter
revenue |
|
$ |
9,341 |
|
|
$ |
9,341 |
|
|
$ |
18,578 |
|
|
$ |
18,678 |
|
Time charter revenue –
related party |
|
|
30,918 |
|
|
|
31,992 |
|
|
|
61,323 |
|
|
|
65,265 |
|
|
|
|
|
|
|
|
|
|
40,259 |
|
|
|
41,333 |
|
|
|
79,901 |
|
|
|
83,943 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
ExpensesVessel operating expenses |
|
|
10,468 |
|
|
|
10,917 |
|
|
|
20,478 |
|
|
|
21,919 |
|
Vessel operating
expenses – related party |
|
|
400 |
|
|
|
400 |
|
|
|
800 |
|
|
|
800 |
|
Depreciation |
|
|
9,541 |
|
|
|
10,877 |
|
|
|
19,141 |
|
|
|
21,812 |
|
General and
administrative |
|
|
1,325 |
|
|
|
1,281 |
|
|
|
2,565 |
|
|
|
3,250 |
|
Other operating
income |
|
|
(6 |
) |
|
|
(63 |
) |
|
|
(48 |
) |
|
|
(144 |
) |
|
|
|
|
|
|
Total operating
expenses |
|
|
21,728 |
|
|
|
23,412 |
|
|
|
42,936 |
|
|
|
47,637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income |
|
|
18,531 |
|
|
|
17,921 |
|
|
|
36,965 |
|
|
|
36,306 |
|
|
|
|
|
|
|
Non Operating
Income (Expense) |
|
|
|
|
|
Interest income |
|
|
90 |
|
|
|
38 |
|
|
|
183 |
|
|
|
82 |
|
Interest expense |
|
|
(11,026 |
) |
|
|
(11,142 |
) |
|
|
(21,983 |
) |
|
|
(24,242 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Income before
Income Taxes |
|
|
7,595 |
|
|
|
6,817 |
|
|
|
15,165 |
|
|
|
12,146 |
|
|
|
|
|
|
|
Income taxes |
|
|
(6 |
) |
|
|
(9 |
) |
|
|
(16 |
) |
|
|
(15 |
) |
|
|
|
|
|
|
Net
Income |
|
$ |
7,589 |
|
|
$ |
6,808 |
|
|
$ |
15,149 |
|
|
$ |
12,131 |
|
|
|
|
|
|
|
Earnings allocated to
Series B Preferred Shares |
|
|
(765 |
) |
|
|
(765 |
) |
|
|
(1,531 |
) |
|
|
(1,531 |
) |
|
|
|
|
|
|
Net Income
available to Common Shareholders |
|
$ |
6,824 |
|
|
$ |
6,043 |
|
|
$ |
13,618 |
|
|
$ |
10,600 |
|
Earnings per
Share |
|
|
|
|
|
Weighted average number
of Class A common shares outstanding |
|
|
|
|
|
Basic
(including RSUs without service conditions)Diluted |
|
|
47,975,60947,975,609 |
|
47,850,10747,956,959 |
|
47,975,60947,975,609 |
|
47,845,84247,888,279 |
Net income per Class A
common share |
|
|
|
|
|
Basic
(including RSUs without service conditions) |
|
$ |
0.14 |
$ |
0.13 |
$ |
0.28 |
$ |
0.22 |
Diluted |
|
$ |
0.14 |
$ |
0.13 |
$ |
0.28 |
$ |
0.22 |
Weighted average number
of Class B common shares outstanding Basic and diluted |
|
|
7,405,956 |
|
7,405,956 |
|
7,405,956 |
|
7,405,956 |
Net income per Class B
common share Basic and diluted |
|
$ |
0.00 |
$ |
0.00 |
$ |
0.00 |
$ |
0.00 |
Global Ship Lease, Inc. |
|
Interim Unaudited Consolidated Balance
Sheets |
|
(Expressed in thousands of U.S. dollars) |
|
|
June 30,2017 |
|
December 31,2016 |
|
|
|
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents |
|
$ |
59,432 |
|
|
$ |
54,243 |
|
Accounts
receivable |
|
|
15 |
|
|
|
29 |
|
Due from related
party |
|
|
862 |
|
|
|
906 |
|
Prepaid expenses |
|
|
1,098 |
|
|
|
1,146 |
|
Other receivables |
|
|
182 |
|
|
|
52 |
|
Inventory |
|
|
674 |
|
|
|
553 |
|
|
|
|
|
|
Total current
assets |
|
|
62,263 |
|
|
|
56,929 |
|
|
|
|
|
|
|
|
|
|
|
Vessels in
operation |
|
|
703,993 |
|
|
|
719,110 |
|
Other fixed assets |
|
|
13 |
|
|
|
7 |
|
Intangible assets |
|
|
11 |
|
|
|
16 |
|
Other long term
assets |
|
|
140 |
|
|
|
195 |
|
|
|
|
|
|
Total non-current
assets |
|
|
704,157 |
|
|
|
719,328 |
|
|
|
|
|
|
Total
Assets |
|
$ |
766,420 |
|
|
$ |
776,257 |
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
Current portion of long
term debt |
|
|
27,512 |
|
|
|
31,026 |
|
Intangible liability –
charter agreements |
|
|
1,788 |
|
|
|
1,807 |
|
Deferred revenue |
|
|
2,698 |
|
|
|
1,940 |
|
Accounts payable |
|
|
791 |
|
|
|
963 |
|
Due to related
party |
|
|
1,817 |
|
|
|
1,315 |
|
Accrued expenses |
|
|
11,034 |
|
|
|
11,664 |
|
|
|
|
|
|
Total current
liabilities |
|
|
45,640 |
|
|
|
48,715 |
|
|
|
|
|
|
|
|
|
|
|
Long term debt |
|
|
369,355 |
|
|
|
388,847 |
|
Intangible liability –
charter agreements |
|
|
8,897 |
|
|
|
9,782 |
|
Deferred tax
liability |
|
|
17 |
|
|
|
20 |
|
|
|
|
|
|
Total long term
liabilities |
|
|
378,269 |
|
|
|
398,649 |
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities |
|
$ |
423,909 |
|
|
$ |
447,364 |
|
|
|
|
|
|
Commitments and
contingencies |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
Stockholders’
Equity |
|
|
|
|
Class A Common stock –
authorized214,000,000 shares with a $0.01 par value; 47,575,609
shares issued and outstanding (2016 – 47,575,609) |
|
$ |
476 |
|
|
$ |
476 |
|
Class B Common stock –
authorized20,000,000 shares with a $0.01 par value;7,405,956 shares
issued and outstanding (2016 – 7,405,956) |
|
|
74 |
|
|
|
74 |
|
Series B Preferred
shares – authorized16,100 shares with $0.01 par value;14,000 shares
issued and outstanding (2016 – 14,000) |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
Additional paid in
capital |
|
|
386,708 |
|
|
|
386,708 |
|
(Accumulated
deficit) |
|
|
(44,747 |
) |
|
|
(58,365 |
) |
|
|
|
|
|
Total
Stockholders’ Equity |
|
|
342,511 |
|
|
|
328,893 |
|
|
|
|
|
|
Total
Liabilities and Stockholders’ Equity |
|
$ |
766,420 |
|
|
$ |
776,257 |
|
|
|
|
|
|
Global Ship Lease, Inc. |
|
Interim Unaudited Consolidated Statements of
Cash Flows |
|
(Expressed in thousands of U.S. dollars) |
|
|
|
|
|
|
Three months ended June 30, |
Six months ended June 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities |
|
|
|
|
|
Net income |
|
$ |
7,589 |
|
|
$ |
6,808 |
|
|
$ |
15,149 |
|
|
$ |
12,131 |
|
|
|
|
|
|
|
Adjustments to
Reconcile Net income to Net Cash Provided by Operating
Activities |
|
|
|
|
|
Depreciation |
|
|
9,541 |
|
|
|
10,877 |
|
|
|
19,141 |
|
|
|
21,812 |
|
Amortization of
deferred financing costs |
|
|
885 |
|
|
|
820 |
|
|
|
1,775 |
|
|
|
1,772 |
|
Amortization of
original issue discount |
|
|
343 |
|
|
|
334 |
|
|
|
625 |
|
|
|
916 |
|
Amortization of
intangible liability |
|
|
(452 |
) |
|
|
(530 |
) |
|
|
(904 |
) |
|
|
(1,059 |
) |
Share based
compensation |
|
|
- |
|
|
|
82 |
|
|
|
- |
|
|
|
115 |
|
Gain on repurchase of
secured notes |
|
|
- |
|
|
|
(452 |
) |
|
|
- |
|
|
|
(452 |
) |
Decrease (increase) in
accounts receivable and other assets |
|
|
382 |
|
|
|
151 |
|
|
|
(199 |
) |
|
|
(398 |
) |
Decrease (increase) in
inventory |
|
|
(73 |
) |
|
|
40 |
|
|
|
(121 |
) |
|
|
74 |
|
Increase (decrease) in
accounts payable and other liabilities |
|
|
8,800 |
|
|
|
8,896 |
|
|
|
(748 |
) |
|
|
(1,285 |
) |
(Decrease) increase in
unearned revenue |
|
|
330 |
|
|
|
(104 |
) |
|
|
758 |
|
|
|
(208 |
) |
Increase in related
party balances |
|
|
580 |
|
|
|
347 |
|
|
|
628 |
|
|
|
1,063 |
|
Unrealized foreign
exchange (gain) loss |
|
|
- |
|
|
|
(58 |
) |
|
|
6 |
|
|
|
(28 |
) |
|
|
|
|
|
|
Net Cash
Provided by Operating Activities |
|
|
27,925 |
|
|
|
27,211 |
|
|
|
36,110 |
|
|
|
34,453 |
|
|
|
|
|
|
|
Cash Flows from
Investing Activities |
|
|
|
|
|
Cash paid for vessel
improvements |
|
|
(100 |
) |
|
|
- |
|
|
|
(100 |
) |
|
|
- |
|
Cash paid in respect of
sale of vessels |
|
|
- |
|
|
|
(97 |
) |
|
|
- |
|
|
|
(254 |
) |
Cash paid for other
assets |
|
|
(8 |
) |
|
|
- |
|
|
|
(8 |
) |
|
|
(1 |
) |
Cash paid for
drydockings |
|
|
(2,211 |
) |
|
|
(948 |
) |
|
|
(3,931 |
) |
|
|
(948 |
) |
|
|
|
|
|
|
Net Cash Used
in Investing Activities |
|
|
(2,319 |
) |
|
|
(1,045 |
) |
|
|
(4,039 |
) |
|
|
(1,203 |
) |
|
|
|
|
|
|
Cash Flows from
Financing Activities |
|
|
|
|
|
Repurchase of secured
notes |
|
|
(19,501 |
) |
|
|
(3,748 |
) |
|
|
(19,501 |
) |
|
|
(30,410 |
) |
Proceeds from drawdown
of revolving credit facility |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Deferred financing
costs incurred |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Repayment of credit
facilities |
|
|
(2,925 |
) |
|
|
(1,925 |
) |
|
|
(5,850 |
) |
|
|
(4,650 |
) |
Series B Preferred
Shares – dividends paid |
|
|
(765 |
) |
|
|
(765 |
) |
|
|
(1,531 |
) |
|
|
(1,531 |
) |
|
|
|
|
|
|
Net Cash Used
in Financing Activities |
|
|
(23,191 |
) |
|
|
(6,438 |
) |
|
|
(26,882 |
) |
|
|
(36,591 |
) |
|
|
|
|
|
|
Net Increase
(decrease) in Cash and Cash Equivalents |
|
|
2,415 |
|
|
|
19,728 |
|
|
|
5,189 |
|
|
|
(3,341 |
) |
Cash and Cash
Equivalents at Start of Period |
|
|
57,017 |
|
|
|
30,522 |
|
|
|
54,243 |
|
|
|
53,591 |
|
|
|
|
|
|
|
Cash and Cash
Equivalents at End of Period |
|
$ |
59,432 |
|
|
$ |
50,250 |
|
|
$ |
59,432 |
|
|
$ |
50,250 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
information |
|
|
|
|
|
|
|
|
|
|
|
Total interest
paid |
|
$ |
746 |
|
|
$ |
725 |
|
|
$ |
19,678 |
|
|
$ |
22,232 |
|
|
|
|
|
|
|
Income tax paid |
|
$ |
10 |
|
|
$ |
10 |
|
|
$ |
24 |
|
|
$ |
26 |
|
|
|
|
|
|
|
CONTACT:
Investor and Media Contact:
The IGB Group
Bryan Degnan
646-673-9701
or
Leon Berman
212-477-8438
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