Grindrod Shipping Holdings Ltd. (NASDAQ: GRIN) (JSE: GSH)
(“Grindrod Shipping” or “Company” or “we” or “us” or “our”), a
global provider of maritime transportation services predominantly
in the drybulk sector, today announced its earnings results for the
three months and the year ended December 31, 2022.
Financial Highlights for the Three
Months Ended December 31, 2022
- Revenues of $81.4 million
- Gross profit of
$23.0 million
- Loss for the period from continuing
operations and attributable to owners of the Company of
$4.6 million, or $0.24 per ordinary share
- Adjusted net income of
$10.6 million, or $0.56 per ordinary share(1)
- Adjusted EBITDA from continuing
operations of $32.2 million(1)
- Handysize and supramax/ultramax TCE
per day of $14,427 and $21,739, respectively(1)
Financial Highlights for the Year Ended
December 31, 2022
- Revenues of
$460.5 million
- Gross profit of
$166.8 million
- Profit for the year from continuing
operations and attributable to owners of the Company of
$103.4 million, or $5.45 per ordinary share
- Adjusted net income of $121.1
million, or $6.39 per ordinary share(1)
- Adjusted EBITDA from continuing
operations of $204.0 million(1)
- Handysize and supramax/ultramax TCE
per day of $22,115 and $25,788, respectively(1)
- Year-end cash and cash equivalents
of $46.6 million and restricted cash of $10.0 million
(1) Adjusted EBITDA, Adjusted net income and TCE
per day are non-GAAP financial measures. For the definitions of
these non-GAAP financial measures and the reconciliation of these
measures to the most directly comparable financial measure
calculated and presented in accordance with GAAP, please refer to
the definitions and reconciliations in “Non-GAAP Financial
Measures” at the end of this press release.
Operational & Corporate Highlights
for the Three Months Ended December 31, 2022
- On October 11, 2022, we exercised
the option to extend the firm charter-in period of the 2020-built
supramax bulk carrier, IVS Atsugi, for 12 months at $12,950/day,
starting from December 23, 2022.
- On October 12, 2022, we announced
that we had entered into a Transaction Implementation Agreement
(“TIA”), dated as of October 11, 2022, between the Company, Taylor
Maritime Investments Limited (“TMI”) and Good Falkirk (MI) Limited,
a wholly-owned subsidiary of TMI (“the Offeror"), providing for a
voluntary conditional cash offer (“the Offer”) to be made by the
Offeror for all of the issued ordinary shares in the capital of the
Company. Under the terms of the Offer, shareholders of the Company
were entitled to receive the offer price of US$21.00 in cash for
each Share tendered in the Offer. Under the terms of the
Implementation Agreement, subject to the conditions to the Offer
being satisfied (or, to the extent permitted, waived) as of the
expiration time of the Offer, the Company agreed to declare and pay
a special dividend of US$5.00 per Share (“Special Dividend”) to
shareholders of record as of November 25, 2022.
- On November 29, 2022, the initial
Offer made by the Offeror on October 28, 2022, expired. All shares
that were validly tendered were accepted for payment, following
which TMI owned approximately 73.78% of the shares of the Company.
A subsequent offer period began immediately thereafter and expired
on December 19, 2022. On expiration of the subsequent and final
offer period, TMI held approximately 83.23% of the outstanding
shares of the Company.
- On December 5, 2022, in accordance
with the terms of the TIA and further to the conditional dividend
declaration made on October 28, 2022, we instructed our transfer
agents to pay and distribute a special dividend of $5 per share to
each holder of shares as of November 25, 2022.
- On December 8, 2022, we announced
that effective from December 6, 2022, Mr. Michael John Hankinson
and Mr. Murray Paul Grindrod had retired as Directors of the
Company in accordance with the terms of the TIA. Mr. Hankinson
accordingly relinquished his positions as Chairman of the Board,
member of the Audit and Risk Committee (“ARC”) and member of the
Compensation and Nomination Committee (“CNC”). In conjunction with
these departures and the appointment of Mr. Hankinson’s and Mr.
Grindrod’s replacements, the Board was also expanded by the
appointment of three further Directors. This resulted in a total of
five new appointments, namely Dr. Kurt Klemme, Ms. Rebecca Brosnan,
Mr. Charles Maltby and Mr. Cullen Schaar as independent,
Non-Executive Directors of the Company; and Mr. Edward Buttery as
non-independent, Non-Executive Director, each to hold office with
effect from December 6, 2022. Mr. Quah Ban Huat relinquished his
position on the CNC but remains the Chairman of the ARC. Mr. John
Herholdt relinquished his position on the ARC but remains as
Chairman of the CNC.
- On December 16, 2022, we announced
that effective from December 14, 2022, the Board had agreed to
expand itself by one additional director and had appointed Mr. Alan
Hatton as an independent, Non-Executive Director of the Company to
fill the position. The Board currently consists of a total of ten
members, including seven independent directors.
- On December 22, 2022, we entered
into a contract to sell the 2015-built ultramax bulk carrier, IVS
Hirono, for $23.75 million (before costs) with delivery to her new
owners planned on or about March 31, 2023.
- On December 29, 2022, we extended
the short-term charter-in on the 2021-built ultramax bulk carrier,
Aries Karin, for a period of 24 months with one 1-year option to
extend. The vessel was previously chartered-in by the Company on a
short-term basis and entered the new contract in direct
continuation from her previous charter. Due to the length of the
new charter-in period, Aries Karin is now part of the long-term
charter-in fleet of the Company.
Recent Developments
- On February 15, 2023, the Company’s
Board of Directors declared an interim quarterly cash dividend of
$0.03 per ordinary share, payable on or about March 17, 2023, to
all shareholders of record as of March 10, 2023 (the “Record
Date”). As of February 15, 2023, there were 19,472,008 common
shares of the Company outstanding.In view of the Record Date of
March 10, 2023, shareholders may not reposition shares between the
JSE and the U.S. Register during the period from March 8, 2023, at
9.00 a.m. (South African time) until March 13, 2023, at 9.00 a.m.
(South African time).
- As of February 10, 2023, we
have contracted the following TCE per day for the first quarter of
2023 (1):
- Handysize: approximately 1,035 operating days(2) at an average
TCE per day of approximately $9,888
- Supramax/ultramax: approximately 1,127 operating days(2) at an
average TCE per day of approximately $11,897
- As of February 10, 2023, the
average long-term charter-in costs per day for the
supramax/ultramax fleet for the first quarter of 2023 is expected
to be approximately $14,593/day.(3)
(1) TCE per day is a non-GAAP financial measure.
For the definition of this non-GAAP financial measure and the
reconciliation of this measure to the most directly comparable
financial measure calculated and presented in accordance with GAAP,
please refer to the definitions and reconciliations in “Non-GAAP
Financial Measures” at the end of this press release.
(2) Operating days: the number of available days
in the relevant period a vessel is controlled by us after
subtracting the aggregate number of days that the vessel is
off-hire due to a reason other than scheduled drydocking and
special surveys, including unforeseen circumstances. We use
operating days to measure the aggregate number of days in a
relevant period during which vessels are actually available to
generate revenue.
(3) Long-term charter-in costs is defined as the
lease payments, including interest, relating to chartered-in
vessels included in our fleet from time to time, which are vessels
for which the period of the charter that we initially commit to is
12 months or more, even if at a given time the remaining period of
their charter may be less than 12 months (“long-term charter-in
vessels”). Such long-term charter-in costs, divided by the number
of operating days for the relevant vessels during the period, is
long-term charter-in costs per day.
CEO Commentary
Stephen Griffiths, the Interim Chief Executive
Officer and Chief Financial Officer of Grindrod Shipping,
commented:
“The fourth quarter of 2022 marked a significant
milestone for Grindrod Shipping as TMI launched its voluntary
tender offer for all of the ordinary shares of the Company,
reaching over 83% ownership at the closing of the Offer. The
transaction brought to a successful conclusion a year-long process
of the Grindrod Shipping Board evaluating strategic alternatives
for the Company and its shareholders. In conjunction with the
closing of the transaction, we also welcomed six talented and
experienced new members to our enlarged Board of Directors and
believe the Company is well positioned for the future.
From a financial perspective, 2022 represented
another stellar year with net profits in excess of $100 million for
the second year in a row. The fourth quarter on the other hand
reflected the progressive weakening of the drybulk markets into the
close of the year and was further impacted by certain nonrecurring
cash and non-cash expenses associated with the tender offer. As a
result of the weaker markets and the special dividend already paid
in fourth quarter, the Board elected to declare a base quarterly
dividend of $0.03 per share for the fourth quarter. Together with
the special dividend and previous quarterly dividends in the first
half of the year, the Company will have paid a total of $6.34 per
share in dividends with respect to 2022.
As we look forward, the Company will be
prioritizing net debt reduction and liquidity flexibility,
particularly as the seasonally weaker first quarter has not
rebounded materially after the conclusion of the Lunar New Year
holidays in Asia. As already recently disclosed, we have committed
to reduce our leverage, which may include further ship sales. We
are also keenly evaluating ways to create better economies of scale
and operating margins for the benefit of all of GSH's shareholders
by optimizing the integration of our businesses and
operations.”
Unaudited Results for the Three Months
Ended December 31, 2022 and 2021
Continuing Operations
Revenue was $81.4 million for the three
months ended December 31, 2022 and $142.5 million for the
three months ended December 31, 2021. Vessel revenue was
$81.2 million for the three months ended December 31, 2022 and
$142.3 million for the three months ended December 31, 2021.
Revenue decreased due to weakening market conditions in the drybulk
business and a reduction in short-term operating days due to the
redelivery of the short-term vessels that were chartered-in during
a weaker market and were not extended due to reduced demand for
drybulk tonnage brought about by a global slowdown in GDP growth,
high interest rates and continued shutdowns in China.
Our handysize total revenue and
supramax/ultramax total revenue was $27.5 million and
$53.9 million, respectively, for the three months ended
December 31, 2022, and $50.6 million and $90.5 million,
respectively, for the three months ended December 31, 2021.
Handysize vessel revenue and supramax/ultramax vessel revenue was
$27.4 million and $53.8 million, respectively, for the
three months ended December 31, 2022, and $50.5 million and
$90.5 million, respectively, for the three months ended
December 31, 2021. The results for the three months ended December
31, 2022 were negatively impacted by lower TCE per day rates
achieved in our handysize and supramax/ultramax drybulk carrier
segments, reflecting the weaker spot markets in these segments
which were additionally impacted by a reduction in short-term
operating days.
Handysize TCE per day was $14,427 per day for
the three months ended December 31, 2022 and $28,842 per day for
the three months ended December 31, 2021. Supramax/ultramax TCE per
day was $21,739 per day for the three months ended December 31,
2022 and $30,089 per day for the three months ended December 31,
2021.
Cost of sales was $58.4 million for the
three months ended December 31, 2022 and $75.7 million for the
three months ended December 31, 2021. The decrease was primarily
due to the decrease in short-term operating days for
supramax/ultramax resulting in decreased voyage expenses and
short-term charter hire expenses.
Our handysize segment and supramax/ultramax
segment cost of sales was $22.4 million and
$36.8 million, respectively, for the three months ended
December 31, 2022 and $21.2 million and $54.8 million,
respectively, for the three months ended December 31, 2021.
Handysize voyage expenses and supramax/ultramax
voyage expenses were $8.2 million and $13.1 million,
respectively, for the three months ended December 31, 2022 and
$6.5 million and $21.2 million, respectively, for the
three months ended December 31, 2021. Handysize charter hire and
supramax/ultramax charter hire were $0.5 million and
$6.3 million, respectively, for the three months ended
December 31, 2022 and $3.2 million and $18.1 million,
respectively, for the three months ended December 31, 2021.
Handysize vessel operating costs and supramax/ultramax vessel
operating costs were $8.7 million and $5.0 million,
respectively, for the three months ended December 31, 2022, and
$8.0 million and $4.3 million, respectively, for the
three months ended December 31, 2021. Handysize vessel operating
costs per day were $6,289 per day for the three months ended
December 31, 2022 and $5,767 per day for the three months ended
December 31, 2021. Vessel operating costs per day were higher in
the handysize drybulk carrier segment for the three months ended
December 31, 2022 in comparison to the three months ended December
31, 2021 due to increased repairs on certain of the older vessels.
Supramax/ultramax vessel operating costs per day were $5,414 per
day for the three months ended December 31, 2022 and $5,168 per day
for the three months ended December 31, 2021. Vessel operating
costs per day increased for the three months ended December 31,
2022 in comparison to the three months ended December 31, 2021 due
to increased stores and spares purchased for a vessel that entered
the fleet in the third quarter of 2022.
The long-term charter-in cost per day for our
supramax/ultramax fleet was $15,224 per day during the three months
ended December 31, 2022 and $12,912 per day for the three months
ended December 31, 2021. The increase is primarily due to the
extension of a charter agreement at a higher rate in May 2022.
During the three months ended December 31, 2022, out of 1,874
operating days in the supramax/ultramax segment, 76.9% were
fulfilled with owned/long-term chartered-in vessels and the
remaining 23.1% with short-term chartered-in vessels compared to
2,305 operating days in the supramax/ultramax segment, 61.9% were
fulfilled with owned/long-term chartered-in vessels and the
remaining 38.1% with short-term chartered-in vessels for the three
months ended December 31, 2021.
Gross profit was $23.0 million for the
three months ended December 31, 2022 and $66.7 million for the
three months ended December 31, 2021.
Other operating (expense) income was an expense
of $3.5 million for the three months ended December 31, 2022
and income of $0.1 million for the three months ended December
31, 2021. Other operating expense included an impairment on ships
of $2.4 million and an impairment on a right of use asset of $1.0
million for the three months ended December 31, 2022.
Administrative expense was $19.7 million
for the three months ended December 31, 2022 and $11.3 million
for the three months ended December 31, 2021. The increase was due
to the fees associated with the tender offer to shareholders to
purchase their shares of $7.1 million that was completed towards
the end of the fourth quarter and the settlement of the forfeitable
share plan awards of $4.8 million as part of the transaction
agreement which was partially offset by a lower staff incentive
accrual.
Interest income was $1.4 million for the
three months ended December 31, 2022 and $0.1 million for the
three months ended December 31, 2021.
Interest expense was $5.3 million for the
three months ended December 31, 2022 and $2.8 million for the
three months ended December 31, 2021. The increase is primarily due
to the increase in interest rates.
Income tax (expense) benefit was an expense of
$0.4 million for the three months ended December 31, 2022 and
a benefit of $0.1 million for the three months ended December 31,
2021.
Loss for the three months ended December 31,
2022 was $4.6 million compared to a profit of
$52.9 million for the three months ended December 31,
2021.
Loss attributable to owners of the Company for
the three months ended December 31, 2022 was $4.6 million
compared to a profit of $52.9 million for the three months
ended December 31, 2021.
Continuing and Discontinued Operation
Loss for the three months ended December 31,
2022 was $4.6 million compared to a profit of $52.8 million for the
three months ended December 31, 2021.
Loss attributable to owners of the Company for
the three months ended December 31, 2022 was $4.6 million compared
to a profit of $52.8 million for the three months ended December
31, 2021.
Unaudited Results for the Year Ended
December 31, 2022 and 2021
Continuing Operations
Revenue was $460.5 million for the year
ended December 31, 2022 and $455.8 million for the year ended
December 31, 2021. Vessel revenue was $430.0 million for the
year ended December 31, 2022 and $455.3 million for the year
ended December 31, 2021. Revenue decreased due to weakening market
conditions in the drybulk business mainly in the second half of the
year and a reduction in short-term supramax/ultramax operating days
which was slightly offset by the sale of a medium range tanker in
the first half of 2022 (included in the Other segment under a
bareboat charter) compared to no ship sales in continuing
operations in 2021.
Our handysize total revenue and
supramax/ultramax total revenue was $159.9 million and
$268.5 million, respectively, for the year ended December 31,
2022, and $158.2 million and $292.3 million,
respectively, for the year ended December 31, 2021. Handysize
vessel revenue and supramax/ultramax vessel revenue was
$159.5 million and $268.4 million, respectively, for the
year ended December 31, 2022, and $157.7 million and
$292.2 million, respectively, for the year ended December 31,
2021. The results for the year ended December 31, 2022 were
negatively impacted by a reduction in handysize short-term
operating days and, to a greater extent, supramax/ultramax
short-term operating days, which was partially offset by higher TCE
per day rates achieved in our handysize and supramax/ultramax
drybulk carrier segment reflecting the stronger spot markets in
these segments mainly in the first half of the year.
Handysize TCE per day was $22,115 per day for
the year ended December 31, 2022 and $21,336 per day for the year
ended December 31, 2021. Supramax/ultramax TCE per day was $25,788
per day for the year ended December 31, 2022 and $23,608 per day
for the year ended December 31, 2021.
Cost of sales was $293.7 million for the
year ended December 31, 2022 and $278.9 million for the year
ended December 31, 2021. The increase was primarily due to the cost
of a ship sold in the first half of 2022 compared to no ship sales
in continuing operations for the same period in 2021 which was
partially offset by a decrease in short-term operating days across
the fleet.
Our handysize segment and supramax/ultramax
segment cost of sales was $93.4 million and
$172.6 million, respectively, for the year ended December 31,
2022 and $84.2 million and $195.8 million, respectively, for
the year ended December 31, 2021.
Handysize voyage expenses and supramax/ultramax
voyage expenses were $30.7 million and $60.4 million,
respectively, for the year ended December 31, 2022 and $27.2
million and $69.6 million, respectively, for the year ended
December 31, 2021. Handysize vessel operating costs and
supramax/ultramax vessel operating costs were $31.6 million
and $18.2 million, respectively, for the year ended December
31, 2022, and $31.0 million and $15.8 million,
respectively, for the year ended December 31, 2021. Handysize
vessel operating costs per day was $5,776 per day for the year
ended December 31, 2022 and $5,670 per day for the year ended
December 31, 2021. The increase was primarily due to increased
repairs on certain of the older vessels. Supramax/ultramax vessel
operating costs per day remained relatively flat at $5,297 per day
for the year ended December 31, 2022 and $5,223 per day for the
year ended December 31, 2021.
The long-term charter-in costs per day for our
supramax/ultramax fleet was $14,299 per day during the year ended
December 31, 2022 and $12,742 per day for the year ended December
31, 2021. The primary reason for the increase is the extension of a
charter agreement in May 2022 at a higher rate. During the year
ended December 31, 2022, out of 8,063 operating days in the
supramax/ultramax segment, 70.5% were fulfilled with
owned/long-term chartered-in vessels and the remaining 29.5% with
short-term chartered-in vessels compared to 9,428 operating days in
the supramax/ultramax segment, 59.6 % were fulfilled with
owned/long-term chartered-in vessels and the remaining 40.4% with
short-term chartered-in vessels for the year ended December 31,
2021.
Gross profit was $166.8 million for the
year ended December 31, 2022 and $176.9 million for the year
ended December 31, 2021.
Other operating income was $0.3 million for
the year ended December 31, 2022 and $3.9 million for the year
ended December 31, 2021.
Administrative expense was $48.1 million
for the year ended December 31, 2022 and $36.1 million for the
year ended December 31, 2021. Administrative expense increased in
the year ended December 31, 2022 as compared to the year ended
December 31, 2021 due to the fees associated with the offer to
shareholders to purchase their shares during the current year of
$10.3 million and the settlement of the FSP awards as part of the
transaction agreement of $4.8 million, which was partially offset
by a lower staff incentive accrual.
Interest income was $2.2 million for the
year ended December 31, 2022 and $0.2 million for the year
ended December 31, 2021.
Interest expense was $17.1 million for the
year ended December 31, 2022 and $12.3 million for the year
ended December 31, 2021. The increase is primarily due to the
increase in interest rates.
Income tax (expense) benefit was an expense of
$0.8 million for the year ended December 31, 2022 and a
benefit of $0.1 million for the year ended December 31,
2021.
Profit for the year ended December 31, 2022 was
$103.4 million and $132.6 million for the year ended
December 31, 2021.
Profit attributable to owners of the Company for
the year ended December 31, 2022 was $103.4 million and
$122.1 million for the year ended December 31, 2021.
Continuing and Discontinued Operation
Profit for the year ended December 31, 2022 was
$103.4 million compared to a profit of $129.5 million for the year
ended December 31, 2021.
Profit attributable to owners of the Company for
year ended December 31, 2022 was $103.4 million compared to $118.9
million for the year ended December 31, 2021.
Net cash flows generated from operating
activities was $186.0 million for the year ended December 31,
2022 and $204.9 million for the year ended December 31, 2021.
Net cash generated from investing activities was $0.1 million
for the year ended December 31, 2022 and $1.1 million for the
year ended December 31, 2021. Net cash flows used in financing
activities was $243.1 million for the year ended December 31,
2022 and $139.1 million for the year ended December 31,
2021.
As of December 31, 2022, we had cash and
equivalents of $46.6 million and restricted cash of
$10.0 million.
About Grindrod Shipping
Grindrod Shipping owns and operates a
diversified fleet of owned, long-term and short-term chartered-in
drybulk vessels predominantly in the handysize and
supramax/ultramax segments. The drybulk business, which operates
under the brand “Island View Shipping” (“IVS”) includes a core
fleet of 32 vessels consisting of 15 handysize drybulk carriers and
17 supramax/ultramax drybulk carriers. The Company is based in
Singapore, with offices in London, Durban, Tokyo and Rotterdam.
Grindrod Shipping is listed on NASDAQ under the ticker “GRIN” and
on the JSE under the ticker “GSH”.
Fleet Table
The following table sets forth certain summary
information regarding our fleet as of the date of this press
release.
Drybulk Carriers — Owned Fleet (25
Vessels)
Vessel Name |
|
Built |
|
Country of Build |
|
DWT |
|
Type of Employment |
Handysize – Eco |
|
|
|
|
|
|
|
|
IVS Tembe |
|
2016 |
|
Japan |
|
37,740 |
|
IVS Commercial(1) |
IVS Sunbird |
|
2015 |
|
Japan |
|
33,400 |
|
IVS Handysize Pool |
IVS Thanda |
|
2015 |
|
Japan |
|
37,720 |
|
IVS Commercial(1) |
IVS Kestrel |
|
2014 |
|
Japan |
|
32,770 |
|
IVS Handysize Pool |
IVS Phinda |
|
2014 |
|
Japan |
|
37,720 |
|
IVS Commercial(1) |
IVS Sparrowhawk |
|
2014 |
|
Japan |
|
33,420 |
|
IVS Handysize Pool |
Handysize |
|
|
|
|
|
|
|
|
IVS Merlion |
|
2013 |
|
China |
|
32,070 |
|
IVS Handysize Pool |
IVS Raffles |
|
2013 |
|
China |
|
32,050 |
|
IVS Handysize Pool |
IVS Ibis |
|
2012 |
|
Japan |
|
28,240 |
|
IVS Handysize Pool |
IVS Kinglet(2) |
|
2011 |
|
Japan |
|
33,130 |
|
IVS Handysize Pool |
IVS Magpie(2) |
|
2011 |
|
Japan |
|
28,240 |
|
IVS Handysize Pool |
IVS Orchard |
|
2011 |
|
China |
|
32,530 |
|
IVS Handysize Pool |
IVS Knot(2) |
|
2010 |
|
Japan |
|
33,140 |
|
IVS Handysize Pool |
IVS Sentosa |
|
2010 |
|
China |
|
32,700 |
|
IVS Handysize Pool |
IVS Kingbird |
|
2007 |
|
Japan |
|
32,560 |
|
IVS Handysize Pool |
Supramax/Ultramax –
Eco |
|
|
|
|
|
|
|
|
IVS Prestwick |
|
2019 |
|
Japan |
|
61,300 |
|
IVS Supramax Pool |
IVS Okudogo |
|
2019 |
|
Japan |
|
61,330 |
|
IVS Supramax Pool |
IVS Phoenix(2) |
|
2019 |
|
Japan |
|
61,470 |
|
IVS Supramax Pool |
IVS Swinley Forest |
|
2017 |
|
Japan |
|
60,490 |
|
IVS Supramax Pool |
IVS Gleneagles |
|
2016 |
|
Japan |
|
58,070 |
|
IVS Supramax Pool |
IVS North Berwick |
|
2016 |
|
Japan |
|
60,480 |
|
IVS Supramax Pool |
IVS Bosch Hoek |
|
2015 |
|
Japan |
|
60,270 |
|
IVS Supramax Pool |
IVS Hirono(3) |
|
2015 |
|
Japan |
|
60,280 |
|
IVS Supramax Pool |
IVS Wentworth |
|
2015 |
|
Japan |
|
58,090 |
|
IVS Supramax Pool |
IVS Pinehurst |
|
2015 |
|
Philippines(4) |
|
57,810 |
|
IVS Supramax Pool |
Drybulk Carriers — Long-Term Charter-In
Fleet (7 Vessels)
Vessel Name |
|
Built |
|
Country of Build |
|
DWT |
|
Charter-in Period(6) |
|
|
Purchase Option Price (Millions) |
|
Type of Employment |
Supramax/Ultramax – Eco |
|
|
|
|
|
|
|
|
|
|
|
|
|
Aries Karin(7) |
|
2021 |
|
Japan |
|
64,230 |
|
2024-25 |
|
$ |
- |
|
IVS Supramax Pool |
IVS Atsugi(8) |
|
2020 |
|
Japan |
|
62,660 |
|
2023-24 |
|
$ |
25.2 |
|
IVS Supramax Pool |
IVS Pebble Beach(9) |
|
2020 |
|
Japan |
|
62,660 |
|
2023-24 |
|
$ |
25.2 |
|
IVS Supramax Pool |
IVS Hayakita(10) |
|
2016 |
|
Japan |
|
60,400 |
|
2023-26 |
|
$ |
~21,6 |
|
IVS Supramax Pool |
IVS Windsor(11) |
|
2016 |
|
Japan |
|
60,280 |
|
2023-26 |
|
$ |
- |
|
IVS Supramax Pool |
IVS Crimson Creek(12) |
|
2014 |
|
Japan |
|
57,950 |
|
2023 |
|
$ |
- |
|
IVS Supramax Pool |
IVS Naruo(13) |
|
2014 |
|
Japan |
|
60,030 |
|
2023-24 |
|
$ |
~13.6 |
|
IVS Supramax Pool |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Commercially managed by Grindrod Shipping alongside the IVS
Handysize Pool. |
(2) |
|
IVS Knot, IVS Kinglet, IVS Magpie and IVS Phoenix have each
undergone separate financing arrangements in which we sold these
vessels but retained the right to control the use of these vessels
for a period up to 2030, 2031, 2031 and 2036, respectively, and we
have an option to acquire IVS Knot, IVS Kinglet and IVS Magpie
commencing in 2021 and IVS Phoenix in 2023. We regard the vessels
as owned since we have retained the right to control the use of the
vessels. |
(3) |
|
IVS Hirono has been contracted for sale and is planned to deliver
to the new owners on or about March 31, 2023. |
(4) |
|
Constructed at Tsuneishi Cebu Shipyard, a subsidiary of Tsuneishi
Shipbuilding of Japan. |
(5) |
|
Charter-in rate: The basic payment to the charterer for the use of
the vessel under time charter. The amount is usually for a fixed
period of time at rates that are generally fixed, but may contain a
variable component based on inflation, interest rates, or current
shipping market rates. The rate does not include any additional
costs that are specified in the contract such as brokerage costs
and victualing costs. |
(6) |
|
Expiration date range represents the earliest and latest
re-delivery periods due to extension options. |
(7) |
|
Chartered-in until Q4 2024 with one one-year option to extend. |
(8) |
|
Chartered-in until Q4 2023 with one one-year option to extend. The
purchase option is exercisable beginning in Q4 2022 and any time
thereafter to expiry date, subject to contract terms and
conditions. The purchase option price reduces with a linear
depreciation of $1.0 million per year or prorate. |
(9) |
|
Chartered-in until Q3 2023 with one one-year option to extend. The
purchase option is exercisable beginning in Q3 2022 and any time
thereafter to expiry date, subject to contract terms and
conditions. The purchase option price reduces with a linear
depreciation of $1.0 million per year or prorate. |
(10) |
|
Chartered-in until Q3 2023 with two one-year options and one
nine-month option to extend. The purchase option is exercisable
next in Q4 2023 subject to contract terms and conditions and
includes an estimated Japanese Yen denominated component but
excludes estimated 50/50 profit sharing with vessel owner. The
Japanese Yen component has been converted at a rate of 133 Yen to
$1. |
(11) |
|
Chartered-in until Q3 2023 with two one-year options and one
nine-month option to extend. |
(12) |
|
Chartered-in for a period of 11 to 13 months commencing May 1,
2022. |
(13) |
|
Chartered-in until Q4 2023 with one one-year option to extend. The
purchase option is exercisable at any time prior to expiry date,
subject to contract terms and conditions. The option includes an
estimated Japanese Yen denominated component which has been
converted at a rate of 133 Yen to $1. |
|
|
|
Unaudited Segment
Information
|
|
Three months ended December 31, |
|
Year ended December 31, |
(In thousands of U.S. dollars) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Drybulk Carriers Business |
|
|
|
|
|
|
|
|
Handysize
Segment |
|
|
|
|
|
|
|
|
Revenue |
$ |
27,484 |
|
$ |
50,593 |
|
$ |
159,934 |
|
$ |
158,210 |
|
Cost of sales |
|
(22,385 |
) |
|
(21,242 |
) |
|
(93,418 |
) |
|
(84,231 |
) |
Gross Profit |
|
5,099 |
|
|
29,351 |
|
|
66,516 |
|
|
73,979 |
|
Supramax/Ultramax
Segment |
|
|
|
|
|
|
|
|
Revenue |
$ |
53,891 |
|
$ |
90,537 |
|
$ |
268,463 |
|
$ |
292,257 |
|
Cost of sales |
|
(36,792 |
) |
|
(54,762 |
) |
|
(172,588 |
) |
|
(195,811 |
) |
Gross Profit |
|
17,099 |
|
|
35,775 |
|
|
95,875 |
|
|
96,446 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Historical and Statistical Data
of Our Operating FleetSet forth below are selected
historical and statistical data of our operating fleet for the
three months ended December 31, 2022 and 2021 and the year ended
December 31, 2022 and 2021 that we believe may be useful in better
understanding our operating fleet’s financial position and results
of operations. This table contains certain information regarding
TCE per day and vessel operating costs per day which are non-GAAP
measures. For a discussion of certain of these measures, see
“Non-GAAP Financial Measures” at the end of this press release.
|
|
Three months ended December 31, |
|
Year ended December 31, |
(In thousands of U.S. dollars) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Drybulk Carriers Business |
|
|
|
|
|
|
|
|
Handysize
Segment |
|
|
|
|
|
|
|
|
Calendar days(1) |
|
1,403 |
|
|
1,586 |
|
|
6,091 |
|
|
6,375 |
|
Available days(2) |
|
1,381 |
|
|
1,565 |
|
|
5,980 |
|
|
6,239 |
|
Operating days(3) |
|
1,333 |
|
|
1,525 |
|
|
5,826 |
|
|
6,115 |
|
Owned fleet operating days(4) |
|
1,310 |
|
|
1,319 |
|
|
5,210 |
|
|
5,215 |
|
Long-term charter-in days(5) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Short-term charter-in days(6) |
|
23 |
|
|
206 |
|
|
616 |
|
|
900 |
|
Fleet utilization(7) |
|
96.5 |
% |
|
97.4 |
% |
|
97.4 |
% |
|
98.0 |
% |
TCE per day(8) |
$ |
14,427 |
|
$ |
28,842 |
|
$ |
22,115 |
|
$ |
21,336 |
|
Vessel operating costs per
day(9) |
$ |
6,289 |
|
$ |
5,767 |
|
$ |
5,776 |
|
$ |
5,670 |
|
|
|
|
|
|
|
|
|
|
Supramax/Ultramax
Segment |
|
|
|
|
|
|
|
|
Calendar days(1) |
|
1,905 |
|
|
2,350 |
|
|
8,210 |
|
|
9,652 |
|
Available days(2) |
|
1,887 |
|
|
2,323 |
|
|
8,143 |
|
|
9,555 |
|
Operating days(3) |
|
1,874 |
|
|
2,305 |
|
|
8,063 |
|
|
9,428 |
|
Owned fleet operating days(4) |
|
903 |
|
|
802 |
|
|
3,345 |
|
|
2,943 |
|
Long-term charter-in days(5) |
|
539 |
|
|
626 |
|
|
2,343 |
|
|
2,674 |
|
Short-term charter-in days(6) |
|
432 |
|
|
877 |
|
|
2,375 |
|
|
3,811 |
|
Fleet utilization(7) |
|
99.3 |
% |
|
99.2 |
% |
|
99.0 |
% |
|
98.7 |
% |
TCE per day(8) |
$ |
21,739 |
|
$ |
30,089 |
|
$ |
25,788 |
|
$ |
23,608 |
|
Vessel operating costs per
day(9) |
$ |
5,414 |
|
$ |
5,168 |
|
$ |
5,297 |
|
$ |
5,223 |
|
|
(1) |
|
Calendar days: total calendar days the vessels were in our
possession for the relevant period. |
|
(2) |
|
Available days: total number of calendar days a vessel is in our
possession for the relevant period after subtracting off-hire days
for scheduled drydocking and special surveys. We use available days
to measure the number of days in a relevant period during which
vessels should be available for generating revenue. |
|
(3) |
|
Operating days: the number of available days in the relevant period
a vessel is controlled by us after subtracting the aggregate number
of days that the vessel is off-hire due to a reason other than
scheduled drydocking and special surveys, including unforeseen
circumstances. We use operating days to measure the aggregate
number of days in a relevant period during which vessels are
actually available to generate revenue. |
|
(4) |
|
Owned fleet operating days: the number of operating days in which
our owned fleet is operating for the relevant period. |
|
(5) |
|
Long-term charter-in days: the number of operating days in which
our long-term charter-in fleet is operating for the relevant
period. We regard chartered-in vessels as long-term charters if the
period of the charter we initially commit to is 12 months or more.
Once we have included such chartered-in vessels in our fleet, we
will continue to regard them as part of our fleet until the end of
their chartered-in period, including any period that the charter
has been extended under an option, even if at a given time the
remaining period of their charter may be less than 12 months. |
|
(6) |
|
Short-term charter-in days: the number of operating days for which
we have chartered-in third party vessels for durations of less than
one year for the relevant period. |
|
(7) |
|
Fleet utilization: the percentage of time that vessels are
available for generating revenue, determined by dividing the number
of operating days during a relevant period by the number of
available days during that period. We use fleet utilization to
measure a company’s efficiency in technically managing its
vessels. |
|
(8) |
|
TCE per day: vessel revenue less voyage expenses during a relevant
period divided by the number of operating days during the period.
The number of operating days used to calculate TCE revenue per day
includes the proportionate share of our joint ventures’ operating
days and includes charter-in days. Please see “Non-GAAP Financial
Measures” above for a discussion of TCE revenue and a
reconciliation of TCE revenue to revenue. |
|
(9) |
|
Vessel operating costs per day: vessel operating costs per day
represents vessel operating costs divided by the number of calendar
days for owned vessels during the period. The vessel operating
costs and the number of calendar days used to calculate vessel
operating costs per day includes the proportionate share of our
joint ventures’ vessel operating costs and calendar days and
excludes charter-in costs and charter-in days. Please see “Non-GAAP
Financial Measures” below for a discussion of vessel operating
costs per day. |
|
|
|
|
Unaudited Condensed Consolidated
Statement of Financial Position
|
|
31 December 2022 |
|
31 December 2021 |
|
|
US$’000 |
|
US$’000 |
ASSETS |
|
|
|
|
Current
assets |
|
|
|
|
Cash and bank balances |
|
52,228 |
|
|
107,118 |
|
Trade receivables |
|
11,290 |
|
|
8,973 |
|
Contract assets |
|
1,313 |
|
|
3,686 |
|
Other receivables and
prepayments |
|
25,066 |
|
|
22,424 |
|
Loans to joint ventures |
|
- |
|
|
10 |
|
Derivative financial
instruments |
|
51 |
|
|
5,370 |
|
Inventories |
|
15,278 |
|
|
13,909 |
|
Total current assets |
|
105,226 |
|
|
161,490 |
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
Restricted cash |
|
4,342 |
|
|
6,649 |
|
Ships, property, plant and
equipment |
|
407,552 |
|
|
437,479 |
|
Right-of-use assets |
|
26,039 |
|
|
32,467 |
|
Interest in joint
ventures |
|
8 |
|
|
13 |
|
Derivative financial
instruments |
|
- |
|
|
611 |
|
Intangible assets |
|
186 |
|
|
227 |
|
Other receivables and
prepayments |
|
860 |
|
|
380 |
|
Other investments |
|
3,714 |
|
|
3,730 |
|
Deferred tax assets |
|
1,304 |
|
|
2,123 |
|
Total non-current assets |
|
444,005 |
|
|
483,679 |
|
|
|
|
|
|
Total
assets |
|
549,231 |
|
|
645,169 |
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
Current
liabilities |
|
|
|
|
Trade and other payables |
|
29,599 |
|
|
33,874 |
|
Contract liabilities |
|
4,369 |
|
|
8,441 |
|
Due to joint ventures |
|
43 |
|
|
- |
|
Lease liabilities |
|
22,058 |
|
|
27,375 |
|
Bank loans and other
borrowings |
|
33,330 |
|
|
28,020 |
|
Retirement benefit
obligation |
|
125 |
|
|
124 |
|
Derivative financial
instruments |
|
138 |
|
|
704 |
|
Provisions |
|
592 |
|
|
1,019 |
|
Income tax payable |
|
423 |
|
|
786 |
|
Total current liabilities |
|
90,677 |
|
|
100,343 |
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
Trade and other payables |
|
140 |
|
|
160 |
|
Lease liabilities |
|
4,055 |
|
|
5,896 |
|
Bank loans and other
borrowings |
|
165,638 |
|
|
217,646 |
|
Retirement benefit
obligation |
|
1,272 |
|
|
1,489 |
|
Total non-current
liabilities |
|
171,105 |
|
|
225,191 |
|
|
|
|
|
|
Capital and
reserves |
|
|
|
|
Share capital |
|
320,683 |
|
|
320,683 |
|
Other equity and reserves |
|
(24,686 |
) |
|
(24,068 |
) |
Accumulated (losses)
profit |
|
(8,548 |
) |
|
23,020 |
|
Total equity |
|
287,449 |
|
|
319,635 |
|
|
|
|
|
|
Total equity and
liabilities |
|
549,231 |
|
|
645,169 |
|
|
|
|
|
|
Unaudited Condensed Consolidated
Statement of Profit or Loss
|
|
Three months ended December 31, |
|
Year ended December 31, |
(In thousands of U.S. dollars, other than per share
data) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Continuing Operations |
|
|
|
|
|
|
|
|
Revenue |
$ |
81,375 |
|
$ |
142,454 |
|
$ |
460,460 |
|
$ |
455,839 |
|
Cost of
sales |
|
|
|
|
|
|
|
|
Voyage expenses |
|
(21,274 |
) |
|
(27,597 |
) |
|
(91,104 |
) |
|
(96,964 |
) |
Vessel operating costs |
|
(12,879 |
) |
|
(11,490 |
) |
|
(46,901 |
) |
|
(43,958 |
) |
Charter hire costs |
|
(6,777 |
) |
|
(21,245 |
) |
|
(58,926 |
) |
|
(75,381 |
) |
Depreciation of ships,
drydocking and plant and equipment– owned assets |
|
(7,768 |
) |
|
(6,717 |
) |
|
(30,498 |
) |
|
(25,866 |
) |
Depreciation of ships and ship
equipment – right-of-use assets |
|
(9,105 |
) |
|
(8,989 |
) |
|
(35,676 |
) |
|
(34,898 |
) |
Other (expenses) income |
|
(590 |
) |
|
301 |
|
|
(696 |
) |
|
(1,875 |
) |
Cost of ship sale |
|
- |
|
|
- |
|
|
(29,897 |
) |
|
- |
|
Gross
profit |
|
22,982 |
|
|
66,717 |
|
|
166,762 |
|
|
176,897 |
|
Other operating (expenses)
income |
|
(3,507 |
) |
|
128 |
|
|
341 |
|
|
3,849 |
|
Administrative expense |
|
(19,719 |
) |
|
(11,336 |
) |
|
(48,069 |
) |
|
(36,089 |
) |
Share of losses of joint
ventures |
|
(2 |
) |
|
(2 |
) |
|
(5 |
) |
|
(31 |
) |
Interest income |
|
1,388 |
|
|
78 |
|
|
2,228 |
|
|
201 |
|
Interest expense |
|
(5,343 |
) |
|
(2,762 |
) |
|
(17,133 |
) |
|
(12,298 |
) |
(Loss) profit before
taxation |
|
(4,201 |
) |
|
52,823 |
|
|
104,124 |
|
|
132,529 |
|
Income tax (expense)
benefit |
|
(381 |
) |
|
59 |
|
|
(757 |
) |
|
118 |
|
(Loss) profit for the
period from continuing operations |
|
(4,582 |
) |
|
52,882 |
|
|
103,367 |
|
|
132,647 |
|
|
|
|
|
|
|
|
|
|
Discontinued
operation |
|
|
|
|
|
|
|
|
Loss for the period from
discontinued operation |
|
- |
|
|
(82 |
) |
|
- |
|
|
(3,165 |
) |
(Loss) profit for the
period |
|
(4,582 |
) |
|
52,800 |
|
|
103,367 |
|
|
129,482 |
|
|
|
|
|
|
|
|
|
|
(Loss) profit for the
period attributable to: |
|
|
|
|
|
|
|
|
Owners of the Company |
|
(4,582 |
) |
|
52,800 |
|
|
103,367 |
|
|
118,925 |
|
Continuing operations |
|
(4,582 |
) |
|
52,882 |
|
|
103,367 |
|
|
122,090 |
|
Discontinued operation |
|
- |
|
|
(82 |
) |
|
- |
|
|
(3,165 |
) |
Non-controlling interests |
|
- |
|
|
- |
|
|
- |
|
|
10,557 |
|
|
|
(4,582 |
) |
|
52,800 |
|
|
103,367 |
|
|
129,482 |
|
|
|
|
|
|
|
|
|
|
(Loss)
profit per share attributable to owners of the
Company: |
|
|
|
|
|
|
From continuing and
discontinued operation |
|
|
|
|
|
|
|
|
Basic |
$ |
(0.24 |
) |
$ |
2.79 |
|
$ |
5.45 |
|
$ |
6.21 |
|
Diluted |
$ |
(0.24 |
) |
$ |
2.66 |
|
$ |
5.45 |
|
$ |
5.94 |
|
|
|
|
|
|
|
|
|
|
From continuing
operations |
|
|
|
|
|
|
|
|
Basic |
$ |
(0.24 |
) |
$ |
2.79 |
|
$ |
5.45 |
|
$ |
6.38 |
|
Diluted |
$ |
(0.24 |
) |
$ |
2.67 |
|
$ |
5.45 |
|
$ |
6.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Condensed Consolidated
Statement of Cash Flows
For the year ended 31 December |
|
2022 |
|
2021 |
|
|
US$’000 |
|
US$’000 |
Operating
activities |
|
|
|
|
Profit for the year |
|
103,367 |
|
|
129,482 |
|
Adjustments for: |
|
|
|
|
Share of losses of joint ventures |
|
5 |
|
|
31 |
|
(Gain) loss on disposal of ships |
|
(84 |
) |
|
1,115 |
|
Loss on disposal of businesses |
|
- |
|
|
26 |
|
Gain on disposal of plant and equipment, furniture and fittings and
motor vehicles |
|
(30 |
) |
|
(14 |
) |
Gain on disposal of right-of-use assets |
|
(6 |
) |
|
(104 |
) |
Depreciation and amortisation |
|
67,275 |
|
|
61,953 |
|
Reversal of impairment loss recognised on ships |
|
(1,707 |
) |
|
(3,557 |
) |
Impairment loss recognised on goodwill and intangibles |
|
- |
|
|
965 |
|
Impairment loss on net disposal group |
|
- |
|
|
2,551 |
|
Impairment loss recognised (reversed) on right-of-use assets |
|
985 |
|
|
(1,046 |
) |
Impairment loss (reversed) recognised on financial assets |
|
(45 |
) |
|
681 |
|
Provision for onerous contracts (reversed) recognised |
|
(427 |
) |
|
939 |
|
Impairment loss recognised on plant and equipment |
|
- |
|
|
1 |
|
Recognition of share-based payments expense |
|
8,134 |
|
|
3,330 |
|
Net foreign exchange gain |
|
(171 |
) |
|
(744 |
) |
Interest expense |
|
17,133 |
|
|
12,947 |
|
Interest income |
|
(2,228 |
) |
|
(236 |
) |
Components of defined benefit costs recognized in profit or
loss |
|
159 |
|
|
177 |
|
Income tax expense (benefit) |
|
757 |
|
|
(2,831 |
) |
Operating cash flows before
movements in working capital and ships |
|
193,117 |
|
|
205,666 |
|
Inventories |
|
(1,371 |
) |
|
(5,089 |
) |
Trade receivables, other receivables and prepayments |
|
(5,556 |
) |
|
(5,361 |
) |
Contract assets |
|
2,373 |
|
|
(2,786 |
) |
Trade and other payables |
|
(5,515 |
) |
|
6,729 |
|
Contract liabilities |
|
(4,072 |
) |
|
3,347 |
|
Due to related parties |
|
49 |
|
|
233 |
|
Operating cash flows before
movement in ships |
|
179,025 |
|
|
202,739 |
|
Capital expenditure on ships |
|
(9,306 |
) |
|
(33,455 |
) |
Proceeds from disposal of ships |
|
29,509 |
|
|
47,819 |
|
Net cash generated from
operations |
|
199,228 |
|
|
217,103 |
|
Interest paid |
|
(14,553 |
) |
|
(11,623 |
) |
Interest received |
|
1,786 |
|
|
236 |
|
Income tax paid |
|
(432 |
) |
|
(864 |
) |
Net cash flows
generated from operating activities |
|
186,029 |
|
|
204,852 |
|
|
|
|
|
|
Investing
activities |
|
|
|
|
Cash transferred in from disposal group |
|
- |
|
|
60 |
|
Repayment of loans and amount due from joint ventures |
|
39 |
|
|
788 |
|
Purchase of plant and equipment |
|
(113 |
) |
|
(49 |
) |
Purchase of intangible assets |
|
(126 |
) |
|
(6 |
) |
Proceeds from disposal of businesses |
|
- |
|
|
68 |
|
Proceeds from disposal of plant and equipment |
|
298 |
|
|
21 |
|
Dividends and distributions received from a joint venture |
|
- |
|
|
184 |
|
Net cash generated
from investing activities |
|
98 |
|
|
1,066 |
|
|
|
|
|
|
Unaudited Condensed Consolidated
Statement of Cash Flows (Cont’d)
For the year ended 31
December |
|
2022 |
|
2021 |
|
|
US$’000 |
|
US$’000 |
|
|
|
|
|
Financing
activities |
|
|
|
|
Long-term interest-bearing debt raised |
|
- |
|
|
48,031 |
|
Payment of principal portion of bank loans and other
borrowings |
|
(49,850 |
) |
|
(82,110 |
) |
Principal repayments on lease liabilities |
|
(56,930 |
) |
|
(36,040 |
) |
Acquisition of non-controlling interest |
|
- |
|
|
(46,634 |
) |
Acquisition of treasury shares |
|
- |
|
|
(11,876 |
) |
Restricted cash |
|
(485 |
) |
|
3,099 |
|
Dividends paid |
|
(135,877 |
) |
|
(13,546 |
) |
Net cash flows used in
financing activities |
|
(243,142 |
) |
|
(139,076 |
) |
|
|
|
|
|
Net (decrease) increase in
cash and cash equivalents |
|
(57,015 |
) |
|
66,842 |
|
Cash and cash equivalents at
the beginning of the period |
|
104,243 |
|
|
37,942 |
|
Effect of exchange rate
changes on the balance of cash held in foreign currencies |
|
(667 |
) |
|
(541 |
) |
Cash and cash
equivalents at the end of the period |
|
46,561 |
|
|
104,243 |
|
|
|
|
|
|
During the year ended December 31, 2021, cash
flows relating to the discontinued operation of the tanker business
were cash generated from operating activities of $21,909,000, cash
generated by investing activities of $962,000 and cash used in
financing activities $25,949,000. There is no discontinued
operation during the twelve months ended December 31, 2022.
Non-GAAP Financial Measures
The financial information included in this press
release includes certain “non-GAAP financial measures” as such term
is defined in SEC regulations governing the use of non-GAAP
financial measures. Generally, a non-GAAP financial measure is a
numerical measure of a company’s operating performance, financial
position or cash flows that excludes or includes amounts that are
included in, or excluded from, the most directly comparable measure
calculated and presented in accordance with IFRS. For example,
non-GAAP financial measures may exclude the impact of certain
unique and/or non-operating items such as acquisitions,
divestitures, restructuring charges, large write-offs or items
outside of management’s control. Management believes that the
non-GAAP financial measures described below provide investors and
analysts useful insight into our financial position and operating
performance.
TCE Revenue and TCE per day
TCE revenue is defined as vessel revenue less
voyage expenses. Such TCE revenue, divided by the number of our
operating days during the period, is TCE per day. Vessel revenue
and voyage expenses as reported for our operating segments include
a proportionate share of vessel revenue and voyage expenses
attributable to our joint ventures based on our proportionate
ownership of the joint ventures for the period the joint venture
existed during the relevant period. The number of operating days
used to calculate TCE per day also includes the proportionate share
of our joint ventures’ operating days for the period the joint
venture existed during the relevant period and also includes
charter-in days.
TCE per day is a common shipping industry
performance measure used primarily to compare daily earnings
generated by vessels on time charters with daily earnings generated
by vessels on voyage charters, because charter hire rates for
vessels on voyage charters have to cover voyage expenses and are
generally not expressed in per-day amounts while charter hire rates
for vessels on time charters do not cover voyage expenses and
generally are expressed in per day amounts.
Below is a reconciliation from revenue to TCE
revenue for the three month period ended December 31, 2022 and
2021.
|
|
Three months ended December 31, |
|
|
2022 |
|
2021 |
(In thousands of U.S. dollars) |
|
Revenue |
|
VoyageExpenses |
|
TCERevenue |
|
Revenue |
|
VoyageExpenses |
|
TCERevenue |
Vessel revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Handysize |
|
27,409 |
|
|
(8,178 |
) |
|
19,231 |
|
|
50,490 |
|
|
(6,506 |
) |
|
43,984 |
|
Supramax/ultramax |
|
53,834 |
|
|
(13,096 |
) |
|
40,738 |
|
|
90,513 |
|
|
(21,159 |
) |
|
69,354 |
|
Other |
|
- |
|
|
|
|
|
|
|
1,324 |
|
|
|
|
|
|
Other revenue |
|
132 |
|
|
|
|
|
|
|
127 |
|
|
|
|
|
|
Revenue |
|
81,375 |
|
|
|
|
|
|
|
142,454 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below is a reconciliation from revenue to TCE
revenue for the year ended December 31, 2022 and 2021.
|
|
Year ended December 31, |
|
|
2022 |
|
2021 |
(In thousands of U.S. dollars) |
|
Revenue |
|
VoyageExpenses |
|
TCERevenue |
|
Revenue |
|
VoyageExpenses |
|
TCERevenue |
Vessel revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Handysize |
|
159,524 |
|
|
(30,683 |
) |
|
128,841 |
|
|
157,707 |
|
|
(27,235 |
) |
|
130,472 |
|
Supramax/ultramax |
|
268,352 |
|
|
(60,420 |
) |
|
207,932 |
|
|
292,179 |
|
|
(69,600 |
) |
|
222,579 |
|
Other |
|
2,082 |
|
|
|
|
|
|
|
5,372 |
|
|
|
|
|
|
Ship sale revenue |
|
29,981 |
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
Other revenue |
|
521 |
|
|
|
|
|
|
|
581 |
|
|
|
|
|
|
Revenue |
|
460,460 |
|
|
|
|
|
|
|
455,839 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vessel operating costs per day
Vessel operating costs per day represents vessel
operating costs divided by the number of calendar days for owned
vessels during the period. The vessel operating costs and the
number of calendar days used to calculate vessel operating costs
per day includes the proportionate share of our joint ventures’
vessel operating costs and calendar days for the period the joint
venture existed during the relevant period and excludes charter-in
costs and charter-in days.
Vessel operating costs per day is a non-GAAP
performance measure commonly used in the shipping industry to
provide an understanding of the daily technical management costs
relating to the running of owned vessels.
EBITDA and Adjusted EBITDAEBITDA is defined as
earnings before income tax benefit (expense), interest income,
interest expense, share of profits (losses) of joint ventures and
depreciation and amortization. Adjusted EBITDA is EBITDA adjusted
to exclude the items set forth in the table below, which represent
certain non-recurring, non-operating or other items that we believe
are not indicative of the ongoing performance of our core
operations.
EBITDA and Adjusted EBITDA are used by analysts
in the shipping industry as common performance measures to compare
results across peers. EBITDA and Adjusted EBITDA are not items
recognized by IFRS, and should not be considered in isolation or
used as alternatives to profit for the period or any other
indicator of our operating performance.
Our presentation of EBITDA and Adjusted EBITDA
is intended to supplement investors’ understanding of our operating
performance by providing information regarding our ongoing
performance that exclude items we believe do not directly affect
our core operations and enhancing the comparability of our ongoing
performance across periods. Our management considers EBITDA and
Adjusted EBITDA to be useful to investors because such performance
measures provide information regarding the profitability of our
core operations and facilitate comparison of our operating
performance to the operating performance of our peers.
Additionally, our management uses EBITDA and Adjusted EBITDA as
measures when reviewing our operating performance. While we believe
these measures are useful to investors, the definitions of EBITDA
and Adjusted EBITDA used by us may not be comparable to similar
measures used by other companies.
The table below presents the reconciliation
between (loss) profit for the period from continuing operations to
EBITDA from continuing operations and Adjusted EBITDA from
continuing operations for the three month period ended December 31,
2022 and 2021 and year ended December 31, 2022 and 2021.
|
|
Three months ended December 31, |
|
Year ended December 31, |
(In thousands of U.S. dollars) |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
(Loss) profit for the period from continuing
operations |
$ |
(4,582 |
) |
$ |
52,882 |
|
$ |
103,367 |
|
$ |
132,647 |
|
Adjusted for: |
|
|
|
|
|
|
|
|
Income tax expense (benefit) |
|
381 |
|
|
(59 |
) |
|
757 |
|
|
(118 |
) |
Interest income |
|
(1,388 |
) |
|
(78 |
) |
|
(2,228 |
) |
|
(201 |
) |
Interest expense |
|
5,343 |
|
|
2,762 |
|
|
17,133 |
|
|
12,298 |
|
Share of losses of joint ventures |
|
2 |
|
|
2 |
|
|
5 |
|
|
31 |
|
Depreciation and amortization |
|
17,177 |
|
|
15,984 |
|
|
67,275 |
|
|
61,919 |
|
|
|
|
|
|
|
|
|
|
EBITDA from continuing
operations |
|
16,933 |
|
|
71,493 |
|
|
186,309 |
|
|
206,576 |
|
|
|
|
|
|
|
|
|
|
Adjusted for |
|
|
|
|
|
|
|
|
Impairment loss (reversal of) recognized on ships |
|
2,366 |
|
|
- |
|
|
(1,707 |
) |
|
(3,557 |
) |
Impairment loss recognized on goodwill and intangibles |
|
- |
|
|
- |
|
|
- |
|
|
965 |
|
Impairment loss (reversal of) recognized on right-of-use
assets |
|
985 |
|
|
- |
|
|
985 |
|
|
(1,046 |
) |
Tender offer and related expenses |
|
7,121 |
|
|
- |
|
|
10,307 |
|
|
- |
|
Secondary registration and offering related expenses |
|
- |
|
|
- |
|
|
- |
|
|
633 |
|
Share based compensation |
|
4,752 |
|
|
1,691 |
|
|
8,134 |
|
|
3,330 |
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA from
continuing operations |
|
32,157 |
|
|
73,184 |
|
|
204,028 |
|
|
206,901 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income and Adjusted Earnings per
share
Adjusted net income is defined as Profit for the
period attributable to the owners of the Company adjusted for
reversal of impairment loss recognized on ships, impairment loss
recognized on goodwill and intangibles, reversal of impairment loss
recognized on right-of-use assets, impairment loss on net disposal
group, loss on disposal of business, share based compensation and
non-recurring expenditure. Adjusted Earnings per share represents
this figure divided by the weighted average number of ordinary
shares outstanding for the period.
Adjusted net income is used by management for
forecasting, making operational and strategic decisions, and
evaluating current company performance. It is also one of the
inputs used to calculate the variable amount that will be returned
to shareholders in the form of quarterly dividends and/or share
repurchases. Adjusted net income is not recognized by IFRS, and
should not be considered in isolation or used as alternatives to
profit for the period or any other indicator of our operating
performance.
Our presentation of Adjusted net income is
intended to supplement investors’ understanding of our operating
performance by providing information regarding our ongoing
performance that exclude items we believe do not directly affect
our core operations and enhancing the comparability of our ongoing
performance across periods. We consider Adjusted net income to be
useful to management and investors because it eliminates items that
are unrelated to the overall operating performance and that may
vary significantly from period to period. Identifying these
elements will facilitate comparison of our operating performance to
the operating performance of our peers. The definitions of Adjusted
net income used by us may not be comparable to similar measures
used by other companies.
The table below presents the reconciliation
between (Loss) profit for the period attributable to the owners of
the Company for continuing operations to Adjusted net income for
continuing operations to for the three month period ended December
31, 2022 and 2021 and year ended December 31, 2022 and 2021.
|
|
Three months endedDecember 31, |
|
Year endedDecember 31, |
(In thousands of U.S. dollars) |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
(Loss) profit for the period attributable to owners of the
Company for continuing operations |
$ |
(4,582 |
) |
$ |
52,882 |
|
$ |
103,367 |
|
$ |
122,090 |
|
Adjusted for: |
|
|
|
|
|
|
|
|
|
Impairment loss (reversal of) recognized on ships |
|
2,366 |
|
|
- |
|
|
(1,707 |
) |
|
(3,557 |
) |
Impairment loss recognized on goodwill and intangibles |
|
- |
|
|
- |
|
|
- |
|
|
965 |
|
Impairment loss (reversal of) recognized on right-of-use
assets |
|
985 |
|
|
- |
|
|
985 |
|
|
(1,046 |
) |
Tender offer and related expenses |
|
7,121 |
|
|
- |
|
|
10,307 |
|
|
- |
|
Secondary registration and offering related expenses |
|
- |
|
|
- |
|
|
- |
|
|
633 |
|
Share based compensation |
|
4,752 |
|
|
1,691 |
|
|
8,134 |
|
|
3,330 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
for continuing operations |
|
10,642 |
|
|
54,573 |
|
|
121,086 |
|
|
122,415 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares on which the profit per share and adjusted earnings per
share has been calculated |
|
19,160,608 |
|
|
18,956,127 |
|
|
18,949,972 |
|
|
19,150,787 |
|
Effect of dilutive potential
ordinary shares |
|
- |
|
|
861,834 |
|
|
- |
|
|
861,834 |
|
Weighted average number of
ordinary shares for the purpose of calculating diluted profit per
share and diluted adjusted earnings per share |
|
19,160,608 |
|
|
19,817,961 |
|
|
18,949,972 |
|
|
20,012,621 |
|
|
|
|
|
|
|
|
|
|
|
Basic (loss) profit per share
for continuing operations |
$ |
(0.24 |
) |
$ |
2.79 |
|
$ |
5.45 |
|
$ |
6.38 |
|
Diluted (loss) profit per
share for continuing operations |
|
(0.24 |
) |
|
2.67 |
|
|
5.45 |
|
|
6.10 |
|
|
|
|
|
|
|
|
|
|
|
Basic adjusted earnings per
share for continuing operations |
$ |
0.56 |
|
$ |
2.88 |
|
$ |
6.39 |
|
$ |
6.39 |
|
Diluted adjusted earnings per
share for continuing operations |
|
0.56 |
|
|
2.75 |
|
|
6.39 |
|
|
6.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headline earnings and Headline earnings per
share
The Johannesburg Stock Exchange, or JSE,
requires that we calculate and publicly disclose Headline earnings
per share and diluted Headline earnings per share. Headline
earnings per share is calculated using net income which has been
determined based on IFRS. Accordingly, this may differ to the
Headline earnings per share calculation of other companies listed
on the JSE because such companies may report their financial
results under a different financial reporting framework such as
U.S. GAAP.
Headline earnings for the period represents
profit for the period attributable to owners of the Company
adjusted for the re-measurements that are more closely aligned to
the operating or trading results as set forth below, and Headline
earnings per share represents this figure divided by the weighted
average number of ordinary shares outstanding for the period.
The table below presents a reconciliation
between (Loss) profit for the period attributable to owners of the
Company to Headline earnings for the three month period ended
December 31, 2022 and 2021 and year ended December 31, 2022 and
2021.
|
|
Three months ended December 31, |
|
Year ended December 31, |
(In thousands of U.S. dollars, except
per share data) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
(Loss) profit for the period attributable to owners of the
Company |
$ |
(4,582 |
) |
$ |
52,800 |
|
$ |
103,367 |
|
$ |
118,925 |
|
Adjusted for: |
|
|
|
|
|
|
|
|
|
Impairment loss (reversal of) recognized on ships |
|
2,366 |
|
|
- |
|
|
(1,707 |
) |
|
(3,557 |
) |
Impairment loss (reversal of) recognized on right-of-use
assets |
|
985 |
|
|
- |
|
|
985 |
|
|
(1,046 |
) |
Impairment loss recognized on goodwill and intangibles |
|
- |
|
|
- |
|
|
- |
|
|
965 |
|
Impairment loss recognised on office equipment, furniture and
fittings and motor vehicles |
|
- |
|
|
1 |
|
|
- |
|
|
1 |
|
Impairment loss on net disposal group |
|
- |
|
|
- |
|
|
- |
|
|
2,551 |
|
Loss on disposals of business |
|
- |
|
|
- |
|
|
- |
|
|
26 |
|
|
|
|
|
|
|
|
|
|
|
Headline (loss)
earnings |
|
(1,231 |
) |
|
52,801 |
|
|
102,645 |
|
|
117,865 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares on which the profit per share and headline earnings per
share has been calculated |
|
19,160,608 |
|
|
18,956,127 |
|
|
18,949,972 |
|
|
19,150,787 |
|
Effect of dilutive potential
ordinary shares |
|
- |
|
|
861,834 |
|
|
- |
|
|
861,834 |
|
Weighted average number of
ordinary shares for the purpose of calculating diluted profit per
share and diluted headline earnings per share |
|
19,160,608 |
|
|
19,817,961 |
|
|
18,949,972 |
|
|
20,012,621 |
|
|
|
|
|
|
|
|
|
|
|
Basic (loss) profit per
share |
$ |
(0.24 |
) |
$ |
2.79 |
|
$ |
5.45 |
|
$ |
6.21 |
|
Diluted (loss) profit per
share |
|
(0.24 |
) |
|
2.66 |
|
|
5.45 |
|
|
5.94 |
|
|
|
|
|
|
|
|
|
|
|
Basic headline (loss) earnings
per share |
$ |
(0.06 |
) |
$ |
2.79 |
|
$ |
5.42 |
|
$ |
6.15 |
|
Diluted headline (loss)
earnings per share |
|
(0.06 |
) |
|
2.66 |
|
|
5.42 |
|
|
5.89 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act 1995 with respect to Grindrod Shipping’s financial
condition, results of operations, cash flows, business strategies,
operating efficiencies, competitive position, growth opportunities,
plans and objectives of management, and other matters. These
forward-looking statements, including, among others, those relating
to our future business prospects, revenues and income, are
necessarily estimates and involve a number of risks and
uncertainties that could cause actual results to differ materially
from those suggested by the forward-looking statements.
Accordingly, these forward-looking statements should be considered
in light of various important factors, including those set forth
below. Words such as “may,” “expects,” “intends,” “plans,”
“believes,” “anticipates,” “hopes,” “estimates,” and variations of
such words and similar expressions are intended to identify
forward-looking statements. These forward-looking statements are
based on the information available to, and the expectations and
assumptions deemed reasonable by Grindrod Shipping at the time
these statements were made. Although Grindrod Shipping believes
that the expectations reflected in such forward-looking statements
are reasonable, no assurance can be given that such expectations
will prove to have been correct. These statements involve known and
unknown risks and are based upon a number of assumptions and
estimates which are inherently subject to significant uncertainties
and contingencies, many of which are beyond the control of Grindrod
Shipping. Actual results may differ materially from those expressed
or implied by such forward-looking statements. Important factors
that could cause actual results to differ materially from estimates
or projections contained in the forward-looking statements include,
without limitation, Grindrod Shipping’s future operating or
financial results; the strength of world economies, including, in
particular, in China and the rest of the Asia-Pacific region; the
effects of the COVID-19 pandemic on our operations and the demand
and trading patterns for the drybulk market, and the duration of
these effects; cyclicality of the drybulk market, including general
drybulk shipping market conditions and trends, including
fluctuations in charter hire rates and vessel values; changes in
supply and demand in the drybulk shipping industry, including the
market for Grindrod Shipping’s vessels; changes in the value of
Grindrod Shipping’s vessels; changes in Grindrod Shipping’s
business strategy and expected capital spending or operating
expenses, including drydocking, surveys, upgrades and insurance
costs; competition within the drybulk industry; seasonal
fluctuations within the drybulk industry; Grindrod Shipping’s
ability to employ its vessels in the spot market and its ability to
enter into time charters after its current charters expire; general
economic conditions and conditions in the oil and coal industries;
Grindrod Shipping’s ability to satisfy the technical, health,
safety and compliance standards of its customers; the failure of
counterparties to our contracts to fully perform their obligations
with Grindrod Shipping; Grindrod Shipping’s ability to execute its
growth strategy; international political and economic conditions
including additional tariffs imposed by China and the United
States; potential disruption of shipping routes due to weather,
accidents, political events, natural disasters or other
catastrophic events; vessel breakdowns; corruption, piracy,
military conflicts, political instability and terrorism in
locations where we may operate, including the recent conflicts
between Russia and Ukraine and tensions between China and Taiwan;
fluctuations in interest rates and foreign exchange rates and the
changes in the method pursuant to which the London Interbank
Offered Rate and other benchmark rates are determined; changes in
the costs associated with owning and operating Grindrod Shipping’s
vessels; changes in, and Grindrod Shipping’s compliance with,
governmental, tax, environmental, health and safety regulations
including the International Maritime Organization, or IMO 2020,
regulations limiting sulfur content in fuels; potential liability
from pending or future litigation; Grindrod Shipping’s ability to
procure or have access to financing, its liquidity and the adequacy
of cash flows for its operation; the continued borrowing
availability under Grindrod Shipping’s debt agreements and
compliance with the covenants contained therein; Grindrod
Shipping’s ability to fund future capital expenditures and
investments in the construction, acquisition and refurbishment of
its vessels; Grindrod Shipping’s dependence on key personnel;
Grindrod Shipping’s expectations regarding the availability of
vessel acquisitions and its ability to buy and sell vessels and to
charter-in vessels as planned or at prices we deem satisfactory;
adequacy of Grindrod Shipping’s insurance coverage; effects of new
technological innovation and advances in vessel design; and the
other factors set out in “Item 3. Key Information-Risk Factors” in
our Annual Report on Form 20-F for the year ended December 31,
2021 filed with the Securities and Exchange Commission on
March 25, 2022. Grindrod Shipping undertakes no obligation to
update publicly or release any revisions to these forward-looking
statements to reflect events or circumstances after the date of
this press release or to reflect the occurrence of unanticipated
events except as required by law.
Company Contact:Stephen GriffithsInterim CEO /
CFOGrindrod Shipping Holdings Ltd.200 Cantonment Road, #03-01
SouthpointSingapore,
089763Email: ir@grindrodshipping.comWebsite: www.grinshipping.com |
Investor Relations / Media Contact:Nicolas
Bornozis / Paul LampoutisCapital Link, Inc.230 Park Avenue, Suite
1536New York, N.Y. 10169Tel.: (212) 661-7566Fax: (212)
661-7526Email: grindrod@capitallink.com |
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