31st Oct 2008 07:00
Goldenport Holdings Inc.
Athens, 31st October 2008
INTERIM MANAGEMENT STATEMENT
Goldenport Holdings Inc. ("Goldenport" or "the Company"), (LSE: GPRT) the international shipping company that owns and operates a fleet of containers and dry-bulk vessels, releases today the update on trading of its fleet as of 30th October 2008 and the third Interim Management Statement for the period from 1 July 2008 to 30 September 2008.
Current Market Outlook:
During October the market has changed dramatically, with the financial crisis affecting the market segments in which we operate, and particularly the bulk-carrier market which experienced material decline.
Spot rates have fallen significantly to levels where in some cases do not even cover the vessels' running expenses. Although we have our vessels operating under long term time charters and therefore we are not directly affected by the prevailing turmoil in the spot market, we expect that certain of our vessels that are due to complete their contracts in 2009 will be redelivered to us at the earliest possible date, affecting our contracted revenue moving forward.
In early October the 1978-built container vessel 'Achim' was redelivered to us one month earlier than initially agreed. Due to the lack of further profitable employment opportunities we sold the vessel for demolition on 29th October for a net consideration of US$ 1.3 million. Apart from the committed revenue that was not received, the Company expects to incur US$ 0.7 million of additional expenses mainly in relation to bunkering and port fees.
In the last week of October, the major P&I club where most of our fleet is insured, notified us that due to the global credit conditions, they intend to charge us an amount of US$ 2.0 million in order to cover their growing deficit. This incremental one-off charge will be included in our operating expenses for the second half of the year.
In the last week of October we noticed press articles in relation to one of our charterers Britannia Bulk that seems to be in financial distress. Britannia Bulk has our panamax bulk carrier 'Gianni D' under charter until late December 2008.
Operational Fleet Forward Coverage:
The percentage of available days of the fleet already fixed under contracts as of 30th October (assuming the latest charter expiration and exercise of all additional hire periods under charter, with the exception of specific vessels due to complete their contracts in 2009 where management believes that they will be redelivered at the earliest date) is as follows:
|
2008(1) (2) |
2009(1) (2) |
2010(1) (2) |
|
|
Total Fleet |
100% (100%) |
82% (84%) |
50% (55%) |
|
Containers |
100% (100%) |
92% (90%) |
63% (71%) |
|
Bulk Carriers |
100% (100%) |
62% (73%) |
26% (26%) |
(1) Percentage of available days of the fleet fixed under contract as reported on 28 August 2008 is given in brackets
(2) The percentages above include only the currently operational fleet of 20 vessels and the vessel 'Fortune' (after the sale of 'Ios', 'Samos', 'Glory D' and 'Achim') and exclude the ten new-build vessels for which we expect delivery in the future.
On the same basis, the estimated total revenue for the years 2008, 2009 and 2010 deriving from contracts already fixed for the operational part of the fleet has declined to US$ 324 million (US$ 352 million as of 28th August release). This calculation reflects revenue for the vessels 'Ios', 'Samos', 'Glory D' and 'Achim' up to the respective dates of their sales and excludes the ten new-build vessels for which we expect delivery in the future.
Fleet Employment Profile:
|
Operational fleet |
||||||
|
Vessel |
Type |
Capacity |
Rate (US$) per day |
Charter Expiration |
||
|
Earliest |
Latest (1) |
|||||
|
Containers |
TEU |
|||||
|
1 |
Fortune (2) |
Post Panamax |
5,551 |
38,000 |
Nov-12 |
Jan-13 |
|
2 |
Bosporus Bridge |
Sub Panamax |
3,720 |
14,750 |
Feb-12 |
Aug-12 |
|
3 |
MSC Finland |
Sub Panamax |
3,032 |
16,500 |
Feb-10 |
Apr-10 |
|
4 |
MSC Scotland |
Sub Panamax |
3,007 |
20,770 |
Sep-09 |
Nov-09 |
|
5 |
MSC Anafi |
Sub Panamax |
2,420 |
20,500 |
Apr-09 |
Apr-09 |
|
6 |
MSC Socotra |
Sub Panamax |
2,258 |
14,350 |
Mar-13 |
May-13 |
|
7 |
Howrah Bridge |
Sub Panamax |
2,257 |
14,180 |
Jul-09 |
Sep-09 |
|
8 |
MSC Himalaya |
Sub Panamax |
2,108 |
12,700 |
Dec-08 |
Dec-08 |
|
14,500 |
Jul-10 |
Sep-10 |
||||
|
9 |
MSC Accra |
Sub Panamax |
1,889 |
14,200 |
Jun-12 |
Aug-12 |
|
10 |
Gitte (3) |
Handy |
976 |
Euro 9,300 |
Aug-09 |
Dec-10 |
|
11 |
Brilliant (4) |
Handy |
976 |
10,750 |
Nov-08 |
Nov-08 |
|
8,000 |
May-09 |
Sep-09 |
||||
|
12 |
MSC Mekong |
Handy |
962 |
6,150 |
Mar-09 |
Mar-09 |
|
7,000 |
Jan-11 |
Mar-11 |
||||
|
13 |
MSC Emirates |
Handy |
934 |
7,000 |
Feb-09 |
Feb-09 |
|
7,000 |
Dec-11 |
Feb-12 |
||||
|
14 |
Tuas Express |
Feeder |
485 |
6,750 |
Nov-08 |
Dec-08 |
|
Dry Bulk |
DWT |
|||||
|
15 |
Vasos (5) |
Capesize |
152,065 |
23,950 |
Feb-11 |
Aug-12 |
|
16 |
Gianni D |
Panamax |
69,100 |
51,500 |
Dec-08 |
Dec-08 |
|
17 |
Athos |
Panamax |
67,515 |
19,300 |
Jan10 |
Aug-10 |
|
18 |
Alex D |
Supramax |
52,315 |
57,000 |
May-09 |
May-09 |
|
19 |
Limnos |
Supramax |
52,266 |
50,000 |
Jan-09 |
Jan-09 |
|
20 |
Lindos |
Supramax |
52,266 |
14,500 |
Jul-09 |
Nov-09 |
|
21 |
Tilos |
Supramax |
52,266 |
43,500 |
Sep-09 |
Sep-09 |
|
Vessels under construction |
||||||
|
Vessel / Yard name |
Type |
Capacity |
Scheduled Delivery |
|||
|
Containers |
TEU |
|||||
|
22 |
Jiangsu Yangzijiang |
Sub Panamax |
2,500 |
2010 |
||
|
23 |
Jiangsu Yangzijiang |
Sub Panamax |
2,500 |
2011 |
||
|
Vessel or Yard name |
Type |
Capacity |
Scheduled Delivery |
Rate (US$) per day |
||
|
Dry Bulk |
DWT |
|||||
|
24 |
COSCO (6) |
Supramax |
57,000 |
2009 |
17,650+50% profit share at BSI + 5% |
|
|
25 |
COSCO (6) |
Supramax |
57,000 |
2009 |
17,700+50% profit share at BSI + 5% over 18,200 |
|
|
26 |
COSCO (6) |
Supramax |
57,000 |
2009 |
25,000 |
|
|
27 |
COSCO |
Supramax |
57,000 |
2009 |
- |
|
|
28 |
QINGSHAN (6) |
Supramax |
57,000 |
2010 |
27,000 |
|
|
29 |
QINGSHAN |
Supramax |
57,000 |
2010 |
||
|
30 |
JES (6) (7) |
Supramax |
53,800 |
2008 |
18,000 |
|
|
31 |
JES (7) |
Supramax |
53,800 |
2009 |
Commercially managed by Glencore AG |
|
|
(1) Represents last day on which the charter may redeliver the vessel assuming exercise of all additional hire periods under charter |
||||||
|
(2) The vessel Fortune is under reconstruction and is expected to commence service in late quarter 4 |
||||||
|
(3) The charter of the vessel Gitte is received in Euros |
||||||
|
(4) Upon commencement of the new charter the vessel 'Brilliant' will be renamed 'Tiger Star' |
||||||
|
(5) Vasos has commenced scheduled dry-docking within Quarter 3. No other vessel has scheduled dry-docking until the end of 2008 |
||||||
|
(6) The charter term is for three years from delivery |
||||||
|
(7) Both vessels owned under a 50:50 joint venture with Glencore AG. |
||||||
Third Quarter 2008, Selected Financial and Operating Data:
|
Balance Sheet Data (in US$ million): |
|
30 September 2008 (Unaudited) |
|
Gross Debt |
158.2 |
|
|
Cash |
44.2 |
|
|
Net Debt |
114.0 |
|
|
Net Debt to book capitalization |
30.8% |
|
|
FLEET DATA: |
|
Quarter 3, 2008 |
|
Average number of vessels in operation |
(1) |
21.6 |
|
Vessels on dry-docking within the period |
1 |
|
|
Number of vessels at end of period: |
||
|
-Operating |
(1) |
21 |
|
-Under reconstruction |
1 |
|
|
-New Buildings under construction |
10 |
|
|
Ownership days |
(1) (2) |
1,983 |
|
Available days |
(1) (2) |
1,926 |
|
Operating days |
(1) (2) |
1,879 |
|
Fleet utilization |
97.6% |
|
(1): Number of vessels in operation, ownership, available and operating days in third quarter, include the vessel 'Glory D' that was sold on 20th August 2008 and 'Achim' that was sold on 29th October 2008.
(2): Ownership, available and operating days exclude the vessel Fortune and the 10 vessels that will be delivered in a future date.
Third Quarter 2008, Review of Operations:
During the third quarter, trading was in line with management's expectations.
Fleet utilisation was 97.6% (96.1% in the previous quarter). Fleet utilisation would have been higher but delays were experienced by the 1977-built vessel 'Athos' in discharging in July.
The Company has repaid US$ 10.6 million of scheduled loan instalments and has drawn-down US$ 24.9 million of previously committed bank debt in order to finance the new building programme.
During the third quarter, the 1978 fully depreciated container vessel 'Glory D' was sold in the demolition market, realising a profit on disposal of US$ 2.7 million.
During the quarter the vessel 'Vasos' commenced scheduled dry-docking in Europe instead of China as was initially planned. This has an impact on the cost of the dry-docking due to higher steel price paid in Euros. The Company expects that the incremental cost will be approximately US$ 2.0 million, increasing the amortisation expense between now and the next scheduled dry-docking in 2.5 years.
As of 30th September the net debt was US$ 114.0 million (US$ 96.3 million as of 30th Of June) and net debt to book capitalisation was 30.8% (28.2% as of 30th of June).
CEO Statement:
Captain Paris Dragnis, Chief Executive Officer of Goldenport, commented: "Our defensive chartering strategy of employing our vessels on time charters allowed us to weather through the early stages of the slow down of global trade.
However, market conditions since September have changed dramatically. Activity in the dry-bulk segment has virtually halted with minimal trade taking place globally, leading to daily rates which in some cases have fallen to such an extent that they no longer cover the running expenses of the vessels.
We have been experiencing decline in both segments that we operate in and our planning assumes that specific operating vessels due to complete their existing contracts within 2009 will be redelivered to us at the earliest date rather than the latest. The effect of this would be to reduce contracted revenue for 2008, 2009 and 2010 under period employment to US$ 324 million from US$ 352 million (as released on 28th August).
During October we had the 1978-built container vessel 'Achim' redelivered to us one month earlier than initially agreed. Due to lack of further profitable employment opportunities, we decided to sell the vessel for scrap, although it was seaworthy for at least one more year. The sale was completed on 29th October for a net consideration of US$ 1.3 million. The demolition market has declined heavily since August when we sold for scrap the sister vessel 'Glory D' for a net consideration of US$ 4.0 million.
In this environment the balance between the market players is fragile and largely driven by momentum and financing constraints. Large charterers are incurring losses from operating vessels that are not employed in trades, whereas smaller players are facing financial distress.
Given the current difficult market circumstances we believe that our bulk carrier vessels opening for re-chartering in 2009 will be chartered at significantly lower rates compared to the existing ones."
- ENDS -
For further information, please contact:
Goldenport Holdings Inc.:
Christos Varsos, Chief Financial Officer +30 210 8910500
John Dragnis, Commercial Director +30 210 8910500
Investor Relations Coordinators:
Capital link:
Annie Evangeli - London +44 203 206 1320
Nicolas Bornozis - New York +1 212 661 7566
E-mail: [email protected]
Further Information:
Overview of Goldenport
Goldenport is an international shipping company that owns and operates a fleet of thirty-one container and dry bulk vessels that transport cargo worldwide. The fleet consists of sixteen container vessels (including two new-build vessels with deliveries scheduled for 2010 and 2011) and fifteen dry bulk carriers (including eight new-build vessels with deliveries scheduled for 2008, 2009 and 2010). Goldenport is listed on the London Stock Exchange under the ticker GPRT.
Website: www.goldenportholdings.com or www.goldenport.biz
Related Shares:
GPRT.L