BALTIC TRADING LTD NEW YORK, May 4, 2015 /PRNewswire/ -- Baltic Trading Limited (NYSE: BALT) ("Baltic Trading" or the "Company") today reported its financial results for the three months ended March 31, 2015.
The following financial review discusses the results for the three months ended March 31, 2015 and March 31, 2014.
First Quarter 2015 and Year-to-Date Highlights
-- Entered into a definitive merger agreement with Genco Shipping & Trading
Limited ("Genco") on April 7, 2015, under which Genco agreed to acquire
Baltic Trading in a stock-for-stock transaction;
-- Recorded a net loss of $42.4 million, or $0.75 basic and diluted net
loss per share, for the first quarter;
-- Excluding a non-cash vessel impairment charge of $30.7 million
relating to the sale of the Baltic Tiger and the Baltic Lion,
recorded a net loss of $11.6 million, or $0.21 basic and diluted net
loss per share for the first quarter
-- Sold the Baltic Tiger and the Baltic Lion for an aggregate purchase
price of $68.5 million on April 8, 2015;
-- Reduced debt outstanding by approximately $41 million as a result
the sale
-- Entered into a $148 million credit facility with Nordea Bank to
refinance the Company's existing senior secured revolving credit
facility and to partially fund the acquisition of the Baltic Scorpion
and the Baltic Mantis; and
-- Took delivery of the Baltic Wasp, a newbuilding Ultramax vessel on
January 2, 2015;
-- Reached an agreement to charter the vessel at a rate based on 115%
of the Baltic Supramax Index for 11.5 to 14.5 months.
Financial Review: 2015 First Quarter
The Company recorded a net loss for the first quarter of 2015 of $42.4 million, or $0.75 basic and diluted net loss per share. Comparatively, for the three months ended March 31, 2014, the Company recorded a net loss of $3.5 million, or $0.06 basic and diluted net loss per share.
EBITDA was $(34.8) million for the three months ended March 31, 2015 versus $3.1 million for the three months ended March 31, 2014.
John C. Wobensmith, President and Chief Financial Officer, commented, "During the first quarter, we entered into a $148 million credit facility and sold two of our vessels, the Baltic Tiger and the Baltic Lion. We also entered into a definitive merger agreement with Genco Shipping & Trading Limited, which we believe will further enhance our industry leadership."
The Company's revenues decreased to $6.9 million for the three months ended March 31, 2015 compared to $13.1 million for the three months ended March 31, 2014. The decrease was primarily due to lower rates achieved by the vessels in our fleet during the first quarter of 2015 versus the same period last year, partially offset by the increase in the size of our fleet.
The average daily time charter equivalent, or TCE, rates obtained by the Company's fleet was $4,941 per day for the three months ended March 31, 2015 as compared to $11,229 for the three months ended March 31, 2014. The decrease in TCE was primarily due to lower spot rates achieved by the vessels in our fleet during the first quarter of 2015 versus the first quarter of 2014. During the first quarter of 2015, excess vessel supply continued to weigh on the drybulk market. Several other factors also contributed towards a weakened rate environment across all vessel classes. Destocking of iron ore inventories at Chinese ports and coal inventories at Chinese power plants, along with seasonally reduced iron ore exports out of Brazil, adversely affected the earnings of Capesize vessels. Furthermore, the sustained Indonesian mineral ore export ban, a decline in steel output, and reduced coal demand all contributed to negatively impact freight rates. Weakened earnings along with strong scrap prices did, however, result in a record pace of demolitions, noticeably reducing net fleet growth for the first quarter of 2015.
Total operating expenses, excluding the non-cash vessel impairment charge of $30.7 million, were $16.6 million for the three months ended March 31, 2015 compared to $15.1 million for the three months ended March 31, 2014. Vessel operating expenses were $6.6 million for the three months ended March 31, 2015 and March 31, 2014, primarily due to the increase in the size of our fleet offset by lower maintenance related expenses. General, administrative and technical management expenses were $2.8 million for the first quarter of 2015 compared to $2.0 million for the first quarter of 2014. The increase was a result of an increase in the size of our fleet as well as higher legal expenses. Depreciation and amortization expenses increased to $5.6 million for the three months ended March 31, 2015 versus $5.1 million for the three months ended March 31, 2014 due to the increase in the size of our fleet slightly offset by a change in estimated residual scrap value. During the quarter beginning July 1, 2014, the Company revised its estimated residual scrap value from $245 per lightweight ton to $310 per lightweight ton, which had the impact of decreasing depreciation expense by approximately $0.1 million for the three months ended March 31, 2015. The change in residual scrap value will only affect depreciation on a prospective basis.
Daily vessel operating expenses, or DVOE, decreased to $4,883 per vessel per day for the first quarter of 2015 from $5,599 per vessel per day for the same quarter in 2014 primarily due to lower maintenance related expenses. We believe daily vessel operating expenses are best measured for comparative purposes over a 12?month period in order to take into account all of the expenses that each vessel in our fleet will incur over a full year of operation. Based on estimates provided by our technical managers and management's views, our DVOE budget for 2015 is $5,450 per vessel per day on a weighted average basis for the entire year.
Merger Agreement with Genco
As previously announced, Baltic Trading entered into a definitive merger agreement with Genco under which Genco will acquire Baltic Trading in a stock-for-stock transaction. Under the terms of the agreement, Baltic Trading will become an indirect wholly-owned subsidiary of Genco, and Baltic Trading shareholders (other than Genco and its subsidiaries) will receive 0.216 shares of Genco common stock for each share of Baltic Trading common stock they own at closing, with fractional shares to be settled in cash. Upon consummation of the transaction, Genco shareholders are expected to own approximately 84.5 percent of the combined company, and Baltic Trading shareholders (other than Genco and its subsidiaries) are expected to own approximately 15.5 percent of the combined company. Shares of Baltic Trading's Class B Stock (all of which are owned by a subsidiary of Genco) will be canceled in the merger. Genco expects to have its stock listed on the NYSE upon consummation of the transaction.
The Boards of Directors of both Genco and Baltic Trading established independent special committees to assess a potential transaction and ultimately negotiate the terms on behalf of their respective companies. Both independent special committees unanimously approved the transaction. The Boards of Directors of both companies approved the merger by unanimous vote of directors present and voting, with Peter C. Georgiopoulos, Chairman of the Board of each company, recused for the vote.
Sale of Capesize Vessels to Genco
Also as previously announced, Baltic Trading entered into an agreement under which Genco acquired all of the shares of two single-purpose entities that were wholly owned by Baltic Trading, each of which owns one Capesize drybulk vessel. The aggregate purchase price was $68.5 million, subject to reduction for approximately $41 million of outstanding first-mortgage debt of such single-purpose entities that and an adjustment for the difference between such single-purpose entities' current assets and total liabilities as of the closing date. Baltic Trading had previously determined to divest these vessels in order to increase its liquidity position and strengthen its balance sheet. Through the transactions, which closed on April 8, 2015, Genco acquired the vessels known as the Baltic Lion and the Baltic Tiger. The independent special committees of both companies' Boards of Directors reviewed and approved this transaction.
Dividends
Our dividend policy is to pay a variable quarterly dividend equal to our Cash Available for Distribution, during the previous quarter, subject to any reserves our board of directors may from time to time determine are required. As a result of the current market conditions, the application of the formula in our policy did not result in a dividend for the first quarter of 2015, and our Board of Directors did not declare a dividend for the period ended March 31, 2015. Moreover, under the terms of our merger agreement with Genco, we are currently prohibited from paying dividends.
Liquidity and Capital Resources
Cash Flow
Net cash used in operating activities for the three months ended March 31, 2015 was $0.4 million compared to net cash provided by operating activities of $1.4 million for the three months ended March 31, 2014. The $1.8 million change in cash provided by operating activities was a result of the following factors: excluding the non-cash impairment of vessel assets of $30.7 million, the Company recorded a net loss in the amount of $11.6 million for the three months ended March 31, 2015 compared to a net loss of $3.5 million for the three months ended March 31, 2014. As a result of the increase in the size of our fleet, included in the net loss was an increase in depreciation of $0.5 million for the three months ended March 31, 2015 compared to the prior year period. The change in accounts receivable balances year-over-year resulted in an additional $1.1 million of operating cash due to the timing of payments received from charterers. Additionally, the change in prepaid and current assets balances and the change in accounts payable balances resulted in increases in operating cash of resulted in a $1.9 million and $1.5 million, respectively. Furthermore, there was a $1.2 million decrease in deferred drydocking costs incurred in March 31, 2015 compared to the prior year period.
Net cash used in investing activities for the three months ended March 31, 2015 was $3.9 million and primarily related to the purchase of vessels, including deposits made and amounts held in escrow reflected as restricted cash for our newbuilding Ultramax vessels. For the three months ended March 31, 2014, net cash used in investing activities was $17.2 million and predominantly related to deposits made for our newbuilding Ultramax vessels.
Net cash provided by financing activities for the three months ended March 31, 2015 was $9.5 million as compared to net cash used in financing activities of $3.0 million for the three months ended March 31, 2014. Net cash provided by financing activities during the three months of 2015 was due to $115.0 million of proceeds from the $148 Million Credit Facility. This was primarily offset by the following uses of cash: $102.3 million repayment of debt under our 2010 Baltic Trading Credit Facility, $0.7 million repayment of debt under our $44 Million Term Loan Facility and $0.4 million repayment of debt under our $22 Million Term Loan Facility. Net cash used in financing activities for the three months ended March 31, 2014 mainly consisted of $1.7 million in dividends paid, a $0.7 million repayment of debt under our $44 Million Term Loan Facility and a $0.4 million repayment of debt under our $22 Million Term Loan Facility.
Capital Expenditures
We make capital expenditures from time to time in connection with vessel acquisitions. Currently, our fleet consists of two Capesize, two Ultramax, four Supramax, and five Handysize vessels with an aggregate capacity of approximately 863,000 dwt. After the expected delivery of two Ultramax newbuildings that Baltic Trading has agreed to acquire, we will own 15 drybulk vessels, consisting of two Capesize, four Ultramax, four Supramax and five Handysize vessels with a total carrying capacity of approximately 991,000 dwt.
In addition to acquisitions that we may undertake in future periods, we will incur additional capital expenditures due to special surveys and drydockings for our fleet. One of our vessels was drydocked during the first quarter of 2015. We currently expect four of our vessels to be drydocked during the remainder of 2015.
As previously announced, we have initiated a fuel efficiency upgrade program for certain of our vessels. We believe this program will generate considerable fuel savings going forward and increase the future earnings potential for these vessels. The upgrades have been successfully installed on five of our vessels, the Baltic Cougar, the Baltic Panther, the Baltic Leopard, the Baltic Jaguar and the Baltic Wind, which completed their respective planned drydocking during 2014. The cost of the upgrades, which will be performed under the planned drydocking schedule for two of our Capesize vessels, is expected to be approximately $500,000 per vessel and is included in our estimated drydocking costs below.
We estimate our capital expenditures related to drydocking for our fleet through the remainder of 2015 to be:
Q2 2015 Q3-Q4 2015
------- ----------
Estimated Costs (1) $2.0 million $2.0 million
Estimated Offhire Days
(2) 40 40
(1) Estimates are based on our
budgeted cost of drydocking
our vessels in China. Actual
costs will vary based on
various factors, including
where the drydockings are
actually performed. We expect
to fund these costs with cash
from operations. These costs
do not include drydock expense
items that are reflected in
vessel operating expenses.
(2) Assumes 20 days per
drydocking per vessel. Actual
length will vary based on the
condition of the vessel, yard
schedules and other factors.
The drydocking for the Baltic Fox was completed during the first quarter. The vessel was on planned offhire for 23.8 days in connection with the scheduled drydocking. Capitalized costs associated with this drydocking incurred during the first quarter of 2015 were approximately $0.5 million.
Summary Consolidated Financial and Other Data
The following table summarizes Baltic Trading Limited's selected consolidated financial and other data for the periods indicated below.
Three Months Ended
March 31, 2015 March 31, 2014
-------------- --------------
(Dollars in thousands, except share and per share
data)
(unaudited)
----------
INCOME STATEMENT DATA:
Revenues $6,911 $13,091
Operating expenses:
Voyage expenses 452 420
Voyage expenses to
parent 87 168
Vessel operating
expenses 6,587 6,551
General,
administrative and
technical
management fees 2,818 1,972
Management fees to
parent 1,012 878
Depreciation and
amortization 5,631 5,103
Impairment of vessel
assets 30,730 -
Total operating
expenses 47,317 15,092
------ ------
Operating loss (40,406) (2,001)
------- ------
Other (expense) income:
Other income
(expense) 10 (20)
Interest income 8 10
Interest expense (1,959) (1,510)
Other expense,
net (1,941) (1,520)
------ ------
Loss before income taxes (42,347) (3,521)
Income tax expense (23) (12)
----
Net loss $(42,370) $(3,533)
======== =======
Net loss per share - basic $(0.75) $(0.06)
====== ======
Net loss per share - diluted $(0.75) $(0.06)
====== ======
Shares used in per share calculation - basic 56,669,868 56,165,944
========== ==========
Shares used in per share calculation - diluted 56,669,868 56,165,944
========== ==========
March 31, 2015 December 31, 2014
-------------- -----------------
BALANCE SHEET DATA: (unaudited)
Cash (excluding restricted cash) $15,051 $9,929
Current assets 23,328 19,383
Total assets 540,425 568,218
Current liabilities 25,434 12,892
Total long-term debt (including current portion) 208,463 196,775
Shareholders' equity 323,328 364,882
Three Months Ended
------------------
March 31, 2015 March 31, 2014
-------------- --------------
(unaudited)
Net cash (used in) provided by operating
activities $(412) $1,422
Net cash used in investing activities (3,934) (17,173)
Net cash provided by (used in) financing
activities 9,468 (2,981)
Three Months Ended
March 31, 2015 March 31, 2014
-------------- --------------
FLEET DATA: (unaudited)
Total number of vessels at end of period 15 13
Average number of vessels(1) 15.0 13.0
Total ownership days for fleet(2) 1,349 1,170
Total available days for fleet(3) 1,289 1,114
Total operating days for fleet(4) 1,285 1,108
Fleet utilization(5) 99.7% 99.5%
AVERAGE DAILY RESULTS:
Time charter equivalent(6) $4,941 $11,229
Daily vessel operating expenses per vessel (7) 4,883 5,599
----- -----
Three Months Ended
March 31, 2015 March 31, 2014
(Dollars in thousands)
---------------------
EBITDA Reconciliation: (unaudited)
Net loss $(42,370) $(3,533)
+ Net interest expense 1,951 1,500
+ Depreciation and amortization 5,631 5,103
+ Income tax expense 23 12
EBITDA(8) $(34,765) $3,082
======== ======
(1) Average number of vessels is the
number of vessels that constituted
our fleet for the relevant period,
as measured by the sum of the number
of days each vessel was part of our
fleet during the period divided by
the number of calendar days in that
period.
(2) We define ownership days as the
aggregate number of days in a period
during which each vessel in our
fleet has been owned by us.
Ownership days are an indicator of
the size of our fleet over a period
and affect both the amount of
revenues and the amount of expenses
that we record during a period.
(3) We define available days as the
number of our ownership days less
the aggregate number of days that
our vessels are off-hire due to
scheduled repairs or repairs under
guarantee, vessel upgrades or
special surveys and the aggregate
amount of time that we spend
positioning our vessels between time
charters. Companies in the shipping
industry generally use available
days to measure the number of days
in a period during which vessels
should be capable of generating
revenues.
(4) We define operating days as the
number of our available days in a
period less the aggregate number of
days that our vessels are off-hire
due to unforeseen circumstances. The
shipping industry uses operating
days to measure the aggregate number
of days in a period during which
vessels actually generate revenues.
(5) We calculate fleet utilization by
dividing the number of our operating
days during a period by the number
of our available days during the
period. The shipping industry uses
fleet utilization to measure a
company's efficiency in finding
suitable employment for its vessels
and minimizing the number of days
that its vessels are off-hire for
reasons other than scheduled repairs
or repairs under guarantee, vessel
upgrades, special surveys or vessel
positioning.
(6) We define TCE rates as our net
voyage revenue (voyage revenues less
voyage expenses (including voyage
expenses to Parent)) divided by the
number of our available days during
the period, which is consistent with
industry standards. TCE rate 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 charterhire rates
for vessels on voyage charters are
generally not expressed in per-day
amounts while charterhire rates for
vessels on time charters generally
are expressed in such amounts.
(7) We define daily vessel operating
expenses to include crew wages and
related costs, the cost of insurance
expenses relating to repairs and
maintenance (excluding drydocking),
the costs of spares and consumable
stores, tonnage taxes and other
miscellaneous expenses. Daily vessel
operating expenses are calculated by
dividing vessel operating expenses
by ownership days for the relevant
period.
(8) EBITDA represents net income
(loss) plus net interest expense,
taxes, and depreciation and
amortization. EBITDA is included
because it is used by management and
certain investors as a measure of
operating performance. EBITDA is
used by analysts in the shipping
industry as a common performance
measure to compare results across
peers. Our management uses EBITDA as
a performance measure in
consolidating internal financial
statements and it is presented for
review at our board meetings. For
these reasons, we believe that
EBITDA is a useful measure to
present to our investors. EBITDA is
not an item recognized by U.S. GAAP
and should not be considered as an
alternative to net income, operating
income or any other indicator of a
company's operating performance
required by U.S. GAAP. EBITDA is not
a source of liquidity or cash flows
as shown in our consolidated
statement of cash flows. The
definition of EBITDA used here may
not be comparable to that used by
other companies.
Baltic Trading Limited's Fleet
Baltic Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Baltic Trading Limited's current fleet consists of two Capesize, two Ultramax, four Supramax, and five Handysize vessels with an aggregate capacity of approximately 863,000 dwt. After the expected delivery of two Ultramax newbuildings that Baltic Trading has agreed to acquire, we will own 15 drybulk vessels, consisting of two Capesize, four Ultramax, four Supramax and five Handysize vessels with a total carrying capacity of approximately 991,000 dwt.
Our current fleet contains five groups of sister ships, which are vessels of virtually identical sizes and specifications. We believe that maintaining a fleet that includes sister ships reduces costs by creating economies of scale in the maintenance, supply and crewing of our vessels. As of May 4, 2015, the average age of our current fleet was 4.6 years, as compared to the average age for the world fleet of approximately nine years for the drybulk shipping segments in which we compete.
The following table reflects the current employment of Baltic Trading's fleet and information on vessels expected to join Baltic Trading's fleet:
Vessel Year Charterer Charter Employment Expected
Built Expiration(1) Structure Delivery (2)
Capesize Vessels
Baltic Bear 2010 Swissmarine Services S.A. April 2016 102.5% of BCI (3)
Baltic Wolf 2010 Swissmarine Services S.A. November 2015 101.5% of BCI (4)
Ultramax Vessels
Baltic Hornet 2014 Swissmarine Asia Pte. Ltd. November 2015 115.5% of BSI (5)
Baltic Wasp 2015 Pioneer Navigation Ltd. December 2015 115% of BSI (6)
Baltic Scorpion 2015 TBD TBD TBD Q2 2015
Baltic Mantis 2015 TBD TBD TBD Q3 2015
Supramax Vessels
Baltic Leopard 2009 Caltrek Freight and Trading Ltd. May 2015 91% of BSI (7)
Baltic Panther 2009 Bulkhandling Handymax A/S August 2015 Spot Pool (8)
Baltic Jaguar 2009 Norvic Shipping North America May/June 2015 $8,500/$6,500 (9)
Inc./Harmony Innovation
Shipping Ltd.
Baltic Cougar 2009 Bulkhandling Handymax A/S August 2015 Spot Pool (8)
Handysize Vessels
Baltic Wind 2009 Trammo Bulk Carriers January 2016 107% of BHSI (10)
Baltic Cove 2010 Trammo Bulk Carriers May 2015 106% of BHSI (11)
Baltic Breeze 2010 Clipper Bulk Shipping Ltd. July 2015 103.5% of BHSI (12)
Baltic Fox 2010 Clipper Logger Pool November 2015 Spot Pool (13)
Baltic Hare 2009 Clipper Logger Pool November 2015 Spot Pool (13)
(1) The charter expiration dates
presented represent the earliest
dates that our charters may be
terminated in the ordinary
course. Under the terms of each
contract, the charterer is
entitled to extend the time
charters from two to four months
in order to complete the vessel's
final voyage plus any time the
vessel has been off-hire.
(2) The dates for the vessels being
delivered in the future are
estimates based on guidance
received from the sellers.
(3) We have agreed to an extension
with Swissmarine Services S.A. on
a spot market-related time
charter for 11 to 13.5 months
based on 102.5% of the average of
the daily rates of the Baltic
Capesize Index (BCI), published
by the Baltic Exchange, as
reflected in daily reports. Hire
is paid in arrears net of a 5.75%
brokerage commission, which
includes the 1.25% commission
payable to Genco Shipping &
Trading Limited ("Genco"). The
extension began on May 1, 2015
after the vessel exited
drydocking for scheduled
maintenance.
(4) We have reached an agreement with
Swissmarine Services S.A. on a
spot market-related time charter
for 11.5 to 14.5 months based on
101.5% of the average of the
daily rates of the BCI, as
reflected in daily reports. Hire
is paid every 15 days in arrears
net of a 5.00% brokerage
commission, which includes the
1.25% commission payable to
Genco. The vessel delivered to
charterers on December 9, 2014.
(5) We have reached an agreement with
Swissmarine Asia Pte. Ltd. on a
spot market-related time charter
for 12 to 15 months based on
115.5% of the average of the
daily rates of the Baltic
Supramax Index (BSI), published
by the Baltic Exchange, as
reflected in daily reports. Hire
is paid every 15 days in arrears
net of a 6.25% brokerage
commission, which includes the
1.25% commission payable to
Genco. The vessel delivered to
charterers on November 1, 2014.
(6) We have reached an agreement with
Pioneer Navigation Ltd. on a spot
market-related time charter for
11.5 to 14.5 months based on 115%
of the average of the daily rates
of the BSI, as reflected in daily
reports. Hire is paid every 15
days in arrears net of a 6.25%
brokerage commission, which
includes the 1.25% commission
payable to Genco. The vessel
delivered to charterers on
January 6, 2015.
(7) The vessel redelivered to Baltic
Trading on May 4, 2015 and is
currently awaiting next
employment.
(8) We have reached an agreement to
enter these vessels into the
Bulkhandling Handymax A/S Pool,
a vessel pool trading in the spot
market of which Torvald Klaveness
acts as the pool manager. Baltic
Trading can withdraw a vessel
with three months' notice.
(9) We have reached an agreement with
Harmony Innovation Shipping Ltd.
on a time charter for
approximately 25 days at a rate
of $6,500 per day. Hire is paid
every 15 days in advance less a
6.25% brokerage commission, which
includes the 1.25% commission
payable to Genco. The vessel is
expected to deliver to charterers
on or about May 9, 2015 after
repositioning. The vessel is
expected to redeliver to Baltic
Trading on or about May 4, 2015.
(10) We have reached an agreement with
Trammo Bulk Carriers on a spot-
market related time charter for
15.5 to 19.5 months based on 107%
of the average of the daily rates
of the Baltic Handysize Index
(BHSI), published by the Baltic
Exchange, as reflected in daily
reports. Hire is paid every 15
days in arrears net of a 6.25%
brokerage commission, which
includes the 1.25% commission
payable to Genco. The vessel
delivered to charterers on
October 3, 2014.
(11) We have reached an agreement with
Trammo Bulk Carriers on a spot
market-related time charter for
a minimum of 10.5 months based on
106% of the average of the daily
rates of the BHSI, as reflected
in daily reports. Hire is paid
every 15 days in arrears net of a
6.25% brokerage commission, which
includes the 1.25% commission
payable to Genco.
(12) We have reached an agreement with
Clipper Bulk Shipping Ltd. on a
spot-market related time charter
based on 103.5% of the average of
the daily rates of the BHSI, as
reflected in daily reports. Hire
is paid every 15 days in arrears
net of a 6.25% brokerage
commission, which includes the
1.25% commission payable to
Genco. The minimum and maximum
expiration dates of the time
charter are July 17, 2015 and
October 1, 2015, respectively.
The vessel delivered to
charterers on November 7, 2014.
(13) We have reached an agreement to
enter these vessels into the
Clipper Logger Pool, a vessel
pool trading in the spot market
of which Clipper Group acts as
the pool manager. Baltic Trading
can withdraw the vessels with a
minimum notice of six months.
About Baltic Trading Limited
Baltic Trading Limited is a drybulk company focused on the spot charter market. Baltic Trading transports iron ore, coal, grain, steel products and other drybulk cargoes along global shipping routes. Baltic Trading Limited's current fleet consists of two Capesize, two Ultramax, four Supramax, and five Handysize vessels with an aggregate capacity of approximately 863,000 dwt. After the expected delivery of two Ultramax newbuildings that Baltic Trading has agreed to acquire, we will own 15 drybulk vessels, consisting of two Capesize, four Ultramax, four Supramax and five Handysize vessels with a total carrying capacity of approximately 991,000 dwt.
Conference Call Announcement
Baltic Trading Limited announced that it will hold a conference call on Tuesday, May 5, 2015 at 8:30 a.m. Eastern Time to discuss its 2015 first quarter financial results. The conference call and a presentation will be simultaneously webcast and will be available on the Company's website, www.BalticTrading.com. To access the conference call, dial (888) 401-4668 or (719) 457-1035 and enter passcode 9111551. A replay of the conference call can also be accessed for two weeks by dialing (888) 203-1112 or (719) 457-0820 and entering the passcode 9111551. The Company intends to place additional materials related to the earnings announcement, including a slide presentation, on its website prior to the conference call.
Website Information
We intend to use our website, www.BalticTrading.com, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included in our website's Investor Relations section. Accordingly, investors should monitor the Investor Relations portion of our website, in addition to following our press releases, SEC filings, public conference calls, and webcasts. To subscribe to our e-mail alert service, please click the "Receive E-mail Alerts" link in the Investor Relations section of our website and submit your email address. The information contained in, or that may be accessed through, our website is not incorporated by reference into or a part of this document or any other report or document we file with or furnish to the SEC, and any references to our website are intended to be inactive textual references only.
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as "anticipate," "budget," "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with a discussion of potential future events, circumstances or future operating or financial performance. These forward looking statements are based on management's current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: (i) declines in demand or rates in the drybulk shipping industry; (ii) prolonged weakness in drybulk shipping rates; (iii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iv) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (v) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (vi) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, lube, oil, bunkers, repairs, maintenance and general, administrative, and management fee expenses; (vii) whether our insurance arrangements are adequate; (viii) changes in general domestic and international political conditions; (ix) acts of war, terrorism, or piracy; (x) changes in the condition of the Company's vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (xi) the amount of offhire time needed to complete repairs on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims, including offhire days; (xii) the Company's acquisition or disposition of vessels; (xiii) our ability to leverage Genco's relationships in the shipping industry; (xiv) the completion of definitive documentation with respect to charters; (xv) charterers' compliance with the terms of their charters in the current market environment; (xvi) the fulfillment of the closing conditions under, or the execution of additional documentation for, the Company's agreements to acquire vessels; (xvii) obtaining, completion of definitive documentation for, and funding of financing for the vessel acquisitions on acceptable terms; (xviii) the risk that the closing of the merger is substantially delayed or does not occur; (xix) factors listed in Genco's registration statement on Form S-4 filed with the Securities and Exchange Commission on May 4, 2015, as the same may be amended; and other factors listed from time to time in our public filings with the Securities and Exchange Commission including, without limitation, the Company's Annual Report on Form 10-K for the year ended December 31, 2014 (as amended) and its subsequent reports on Form 10-Q and Form 8-K. Our ability to pay dividends in any period will depend upon various factors, including the limitations under any credit agreements to which we may be a party, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary. We do not undertake any obligation to update or revise any forward?looking statements, whether as a result of new information, future events or otherwise.
Important Information for Investors and Shareholders
In connection with the proposed transaction between Genco and Baltic Trading, Genco and Baltic Trading intend to file relevant materials with the Securities and Exchange Commission (the "SEC"), including a Genco registration statement on Form S-4 filed on May 4, 2015 that includes a preliminary joint proxy statement of Genco and Baltic Trading that also constitutes a preliminary prospectus of Genco. The definitive joint proxy statement/prospectus will be delivered to shareholders of Genco and Baltic Trading. INVESTORS AND SECURITY HOLDERS OF GENCO AND BALTIC TRADING ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT GENCO, BALTIC TRADING AND THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain free copies of the registration statement and the definitive joint proxy statement/prospectus (when available) and other documents filed with the SEC by Genco and Baltic Trading through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by Genco (when available) will be available free of charge on Genco's internet website at www.gencoshipping.com. Copies of the documents filed with the SEC by Baltic Trading (when available) will be available free of charge on Baltic Trading's internet website at www.baltictrading.com.
Participants in the Merger Solicitation
This communication is not a solicitation of a proxy from any investor or securityholder. However, Genco, Baltic Trading, their respective directors and certain of their executive officers and employees may be deemed to be participants in the solicitation of proxies in connection with the proposed transaction under the rules of the SEC. In addition, Genco and Baltic Trading have retained D.F. King & Co., Inc. to solicit proxies in connection with the proposed transaction. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of Genco and Baltic Trading shareholders in connection with the proposed transaction and a description of their direct and indirect interests, by security holdings or otherwise, is set forth in the preliminary joint proxy statement/prospectus. Information about the directors and executive officers of Genco and Baltic Trading is set forth in the preliminary joint proxy statement/prospectus and amendments to both companies' Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on April 30, 2015. These documents are available free of charge from the sources indicated above.
Non-Solicitation
This communication does not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
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SOURCE Baltic Trading Limited
