TIDMTMIP TIDMTMI
RNS Number : 9791T
Taylor Maritime Investments Limited
28 July 2022
28 July 2022
Taylor Maritime Investments Limited (the "Company")
Quarterly NAV Announcement, Trading Update and Publication of
Factsheet
Continued NAV and cash yield appreciation, longer-term earnings
visibility and dividend increase against a backdrop of favourable
market fundamentals
-- Unaudited NAV up c.3% since 31 March 2022 and c.83% since IPO
-- Market Value of vessel portfolio up c.10% to $542m
-- Firm charter rates and cash yields in excess of 26%
-- Increased interim dividend of 2 cents per share declared, an
increase of 14% per ordinary share
Taylor Maritime Investments Limited, the specialist dry bulk
shipping company, today announces that as at 30 June 2022 its
unaudited NAV was $1.79 per ordinary share, an increase of c.3%
since 31 March 2022 and c.83% since IPO in late May 2021.
The Company is also pleased to declare an increased interim
dividend in respect of the period to 30 June 2022 of 2 US cents per
Ordinary Share, an increase of 14% per share and reflecting a new
annualised dividend target for financial year 2022 of 8% on the IPO
price.
The first quarterly factsheet of the new financial year is also
now available on the Company's website,
www.taylormaritimeinvestments.com .
Key Highlights (all as at 30 June 2022)
-- The Market Value of the vessel portfolio was $542m, an
increase of 10% or $50m versus the 31 March 2022 Market Value of
$492m for the same portfolio of vessels
-- The fleet's average net time charter rate was c.$20,650 per
day, with an average duration of eight months and average
annualized unlevered gross cash yield of 26% based on 30 June 2022
Fair Market Values, generating an operating profit for the period
of c.$30m
-- When combined with dividends paid during the quarter of 4.97
cents (comprising an interim dividend of 1.75 cents and a special
interim dividend of 3.22 cents) and a c.33% reduction in Grindrod
Shipping's share price over the period (from $25.44 to $17.15), the
net positive effect on unaudited NAV per ordinary share was
c.3%
-- During the quarter, the Company completed three previously
announced vessel sales and announced an agreement to sell one more
vessel which is expected to complete in the second quarter of the
2022 financial year, generating an IRR of 80% and MOIC of 1.9x
-- As of 30 June 2022, the Company's fleet comprised 28 vessels
of which 27 were Handysize and one Supramax
-- Five vessels in the fleet were fixed on time charters of
approximately 12 months and the portion of the fleet on charters of
12 months or more increased to 25%, up from 18% from the previous
quarter, in line with the Company's intention to secure more
earnings cover by fixing a greater portion of the fleet on
longer-term charters at attractive yields through the summer and
beyond
-- The Company received a further dividend of $0.47 per share
from Grindrod Shipping paid in June 2022 totalling $2.3m ($1.91 per
share of dividends, or $6m, received in aggregate since stake
acquisition representing a c.14% yield on the investment)
Post-Period Trading Update (since 30 June 2022)
-- Since quarter end, two vessels commenced new time charter
fixtures of more than 12 months duration
-- This increased the portion of the fleet on time charters of 12 months or more to 32%
-- The Company has covered 53% of remaining fleet days for the
Financial Year ending 31 March 2023 at an average net time charter
rate of $19,700 per day
-- The value of second-hand ships has since risen from $19.5m
for a ten year-old 32k dwt Handysize vessel at the end of the
period to $20.5m according to Clarksons
Commenting on the trading update, Edward Buttery, Chief
Executive Officer, said:
" The first year's exceptional financial results have now been
followed with our fifth consecutive quarter of NAV appreciation and
a dividend increase. Despite macro uncertainties, fundamentals in
our sector remain positive and we continue to extract attractive
yields in a historically strong market. We locked in substantial
levels of revenue across a greater proportion of the fleet
supporting earnings visibility and certainty. We have unusual
clarity over the supply side market fundamentals, particularly for
our segment, which we expect to support a favourable market well
into 2024. We constantly monitor the orderbook for indicators of
market direction beyond that point and continue to assess accretive
growth opportunities to enhance shareholder returns. We have been
equally opportunistic about taking profit on vessels where we feel
we are able to achieve higher than NAV prices with the chance of
recycling the capital at more attractive levels."
Handysize bulk market outlook
Supply side constraints continue to provide support for both
rates and vessel values and are expected to persist well into 2024.
The Handysize orderbook is currently 5.6%, the lowest of all dry
bulk segments, while the overall dry bulk orderbook stands at 7.1%.
This is the result of various factors including newbuild price
inflation (Clarksons bulkcarrier newbuilding price index has
climbed c.37% since December 2020), orders in other segments
filling yards and ongoing uncertainty around future ship
technologies. The Handysize orderbook has a staggered delivery
profile over the next three years with 1.4% delivering in 2022,
2.7% in 2023 and 1.6% from 2024 onwards (Source: Clarksons).
Minor bulk demand growth remains firm at 2.1% in 2022 (and in
line with supply growth of 2.2%) despite increasing inflationary
pressures, China Covid restrictions and the ongoing Russia-Ukraine
war. With 8.6% of the global fleet over 25 years old and a further
0.6% turning 25 in 2022, research analysts expect older, less
efficient tonnage to be removed and forecast the Handysize fleet to
shrink by 2.2% net in 2023 against minor bulk demand growth of 2.7%
- an attractive spread. This compounds the 2021 spread of 5.4%
demand growth against 2.8% supply growth (Source: Clarksons).
June and July saw some softening from previous annual highs in
terms of rates owing to a poor grain season in the Atlantic and
geopolitical factors with food security concerns resulting in a
reduction in grain released for export causing the market to take a
breather. We are now seeing a strong upswing in fertiliser volumes
and expect to see an increase in grain shipments in the latter half
of the quarter. This may be bolstered in the short to medium term
by the recent Russia/Ukraine grain agreement and, whatever the
case, we maintain a positive outlook for the remainder of the
year.
Asset values increased during the quarter with Clarkson's
benchmark for a ten year old 32k dwt built Handysize rising to
$19.5m (and to $20.5m since the quarter end). When compared to the
same period last year, asset values have risen c.42%. With the
Handysize orderbook at multi-decade lows, a tightening supply
outlook and steady minor bulk demand growth, we believe there is
further upside to second-hand asset values.
Financing
The RCF was $140m drawn at the end of the quarter. The current
intention is to repay drawn funds from pending vessel sales and
future operating cashflow.
ESG
Sustainability is at the heart of the way the Company is
managed, and the profile and management of the fleet is integral to
this. TMI's inaugural set of ESG disclosures was published in the
Company's first Annual Report, highlighting progress to date and
actions taken to meet near term carbon intensity targets. The ESG
& Engagement Committee of TMI's Board continues to oversee the
Group's ESG approach.
TMI is committed to achieving a long-term target of running a
fleet comprising only zero-emission vessels by 2050, and to cross
industry efforts to promote and achieve that target. Substantial
technological advances are a key element of this for the broader
shipping industry, but TMI has clearly defined near-term
initiatives with incremental progress made so far. TMI has an
ongoing, comprehensive programme to improve vessel energy
efficiency and lower carbon intensity across the fleet. During the
period, three vessels were fitted with energy saving devices
including boss-cap fins, high performance paints, pre-swirl ducts
and fuel efficiency monitoring systems. From a marine biodiversity
perspective, two further vessels were installed with Ballast Water
Management Systems during the period, bringing the fleet total to
75%. 93% will be fitted by the end of 2022, and two vessels to be
fitted in 2023.
TMI has successfully implemented plastic reduction initiatives
across the fleet, including the phasing out of single-use plastic
onboard and the use of the data app EYESEA to map ocean plastic
pollution. TMI remains committed to the safety and wellbeing of
seafarers and recently contributed to the International Radio
Medical Centre ("CIRM"), a free medical advice service offered to
all seafarers onboard TMI vessels. With the recent events in
Ukraine, TMI has taken measures to support the welfare of both the
seafarers and their families affected by the conflict. TMI has
contributed to the Seafarers International Relief Fund, as well as
an organisation working to supply aid to those affected by the
conflict in Ukraine.
The Company is, in connection with the long-term emissions goals
mentioned above, a signatory to the Getting to Zero Coalition's
Call to Action for Shipping Decarbonisation. The Company's
investment and ESG strategy is aligned with specified UN
Sustainable Development Goals.
ENDS
For further information, please contact:
Taylor Maritime Investments IR@tminvestments.com
Limited
Edward Buttery
Camilla Pierrepont
Jefferies International Limited
Stuart Klein
Gaudi Le Roux +44 20 7029 8000
Montfort Communications TMI@montfort.london
Alison Allfrey
George Morris Seers
Sanne Fund Services (Guernsey)
Limited
(formerly Praxis Fund Services
Limited)
Tom Daish
Matt Falla +44 1481 737600
Notes to editors
About the Company
Taylor Maritime Investments Limited is an internally managed
shipping company listed on the Premium Segment of the Official
List, its shares trading on the Main Market of the London Stock
Exchange since May 2021. The Company specializes in the acquisition
and chartering of vessels in the Handysize and Supramax bulk
carrier segments of the global shipping sector. The Company invests
in a diversified portfolio of vessels which are primarily
second-hand and which, historically, have demonstrated average
yields in excess of the Company's target dividend yield of 8% p.a.
(on the Initial Issue Price). The shares offer a compelling and
differentiated investment opportunity with the aim of delivering
strong cashflow, stable income and potential for capital
growth.
The Company invests in high quality, Japanese built vessels
which are primarily second-hand and acquired at valuations below
long-term average prices and depreciated replacement cost. The
current portfolio numbers 28 vessels. The Company has a leading
position in the Handysize shipping sector and, thanks to versatile
geared vessels delivering necessity goods, provides an attractive,
defensible yield underpinned by zero long-term structural gearing,
financial discipline and an optimal balance of charter rates and
durations. It has a selective growth strategy focusing on accretive
opportunities to increase shareholder returns and recycle capital
efficiently.
The Company has announced an increased interim dividend of 2
cents per Ordinary Share paid on a quarterly basis, with a targeted
total NAV return of 10-12% per annum (net of expenses and fees but
excluding any tax payable by Shareholders) over the medium to
long-term. The Board approved a special dividend of 3.22 cents per
share in respect of the period to 31 March 2022 paid on 6 May 2022,
which brought total dividends declared for the period from IPO to
31 March 2022 to 8.47 US cents per share, representing a dividend
yield on the IPO price of approximately 10% on an annualised basis.
This reflected excess cash generation in what continues to be a
historically strong market and a desire to return capital to
shareholders in a timely manner.
Sustainability is at the heart of the way in which the Company
is managed and it is committed to achieving a long-term target of
zero carbon emissions by 2050. Substantial technological advances
are a key element of this for the broader shipping industry, with
near term incremental progress effected by initiatives such as
retrofitting the fleet with energy saving devices, using low
sulphur fuels and trialling biofuels.
The Company has the benefit of an experienced Executive Team led
by Edward Buttery. The Executive Team worked closely together at
the Commercial Manager, Taylor Maritime. Established in 2014,
Taylor Maritime is a privately owned ship-owning and management
business with a seasoned team that includes the founders of dry
bulk shipping company Pacific Basin Shipping (listed in Hong Kong
2343.HK) and gas shipping company BW Epic Kosan (formerly Epic
Shipping) (listed in Oslo BWEK:NO). Taylor Maritime's team of
experienced industry professionals are based in Hong Kong,
Singapore and London.
For more information, please visit
www.taylormaritimeinvestments.com .
About Geared vessels
Geared vessels are characterised by their own loading and
unloading equipment. The Handysize market segment is particularly
attractive, given the flexibility, versatility and port
accessibility of these vessels which carry necessity goods -
principally foodstuffs and products related to infrastructure
building - ensuring broad diversification of fleet activity and
stability of earnings.
IMPORTANT NOTICE
The information in this announcement may include forward-looking
statements, which are based on the current expectations and
projections about future events and in certain cases can be
identified by the use of terms such as "may", "will", "should",
"expect", "anticipate", "project", "estimate", "intend",
"continue", "target", "believe" (or the negatives thereon) or other
variations thereon or comparable terminology. These forward-looking
statements are subject to risks, uncertainties and assumptions
about the Company, including, among other things, the development
of its business, trends in its operating industry, and future
capital expenditures and acquisitions. In light of these risks,
uncertainties and assumptions, the events in the forward-looking
statements may not occur.
References to target dividend yields and returns are targets
only and not profit forecasts and there can be no assurance that
these will be achieved.
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END
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