GasLog Ltd. and its subsidiaries (“GasLog”, “Group” or “Company”)
(NYSE: GLOG), an international owner, operator and manager of
liquefied natural gas (“LNG”) carriers, today reported its
financial results for the quarter ended March 31, 2020.
Highlights
• |
Dedicated
COVID-19 task force established to manage the impact of COVID-19 on
all aspects of our business and operations and to review and
update our business continuity plan as required, including strict
guidelines regarding access to all vessels and a company-wide “work
from home” policy. |
• |
Delivery of the
GasLog Windsor on April 1, 2020, a 180,000 cubic meters (“cbm”) LNG
carrier with dual fuel medium speed propulsion (“X-DF”) and
commencement of its seven-year time charter agreement with a wholly
owned subsidiary of Centrica plc. (“Centrica”). |
• |
Announcement by
Gastrade S.A. (“Gastrade”) of the successful conclusion of the
binding phase of the market test for reservation of capacity at the
floating LNG terminal being developed in Alexandroupolis. This
reservation of up to 2.6 billion cubic meters (“cbm”) of capacity
for periods out to 15 years represents a key milestone for the
project. |
• |
Repurchase and
cancellation of NOK 434,000 of the outstanding senior unsecured
bonds due in May 2021 (the “NOK 2021 Bonds”). |
• |
Scheduled
delivery for May 11, 2020, of the GasLog Wales, a 180,000 cbm LNG
carrier with X-DF propulsion and commencement of its 12-year time
charter agreement with the principal LNG shipping entity of Japan’s
Jera Co., Inc. (“JERA”). |
• |
Contracted time
charter revenues of approximately $430.0 million for the remainder
of 2020, representing 77.0% charter coverage. |
• |
Quarterly
Revenues of $165.9 million, Loss of ($39.4) million and Loss per
share of ($0.67)(1) for the quarter ended March 31, 2020. |
• |
Quarterly
Adjusted EBITDA(2) of $114.0 million, Adjusted Profit(2) of $26.8
million and Adjusted Earnings per share(2) of $0.15(1) for the
quarter ended March 31, 2020. |
• |
Reduced quarterly
dividend of $0.05 per common share payable on May 28, 2020. |
|
|
(1) Earnings/(loss) per share (“EPS”) and Adjusted EPS are net
of the profit attributable to the non-controlling interests of
$12.0 million and the dividend on preferred stock of $2.5 million
for the quarter ended March 31, 2020 ($16.8 million and $2.5
million, respectively, for the quarter ended March 31, 2019).
(2) Adjusted EBITDA, Adjusted Profit and Adjusted EPS are
non-GAAP financial measures and should not be used in isolation or
as a substitute for GasLog’s financial results presented in
accordance with International Financial Reporting Standards
(“IFRS”). For the definitions and reconciliations of these measures
to the most directly comparable financial measures calculated and
presented in accordance with IFRS, please refer to Exhibit II at
the end of this press release.
CEO Statement
Paul Wogan, Chief Executive Officer, stated: “GasLog’s business
model and strategy demonstrated its resilience in the first quarter
of 2020, despite the challenges imposed by the COVID-19 outbreak.
Our proactive approach to mitigating the impact of the outbreak on
our seafarers and onshore staff allowed the Company to deliver
uninterrupted service for our customers with fleet availability of
close to 100%. I have been deeply impressed with the dedication and
hard work of our employees, and I am especially grateful to our
seafarers for their commitment and professionalism while apart from
their loved ones.
In light of the uncertainties created by the current
environment, we have taken actions to improve our liquidity,
including drawing on our existing revolving capacity of $100.0
million as well as reducing our dividend for the first quarter of
2020 to $0.05 per share. We continue to expect to realise
approximately $6.0 million of general and administrative cost
reductions in 2021, resulting from the personnel relocations and
headcount reductions announced earlier this year. We also
anticipate finding additional ways to reduce meaningfully our
operating and overhead expenses.
Although the COVID-19 outbreak creates an uncertain outlook for
near term economic activity and LNG demand, underlying demand for
LNG has held up well in 2020 to date and I have been pleased with
the utilisation we have achieved with our vessels operating in the
spot market. We have also had several positive commercial and
operational developments in recent weeks, including the delivery of
the GasLog Windsor which delivered last month on time and on
budget. The vessel is chartered for seven years to Centrica,
providing added visibility for our future revenues and cash flows.
In addition, the Alexandroupolis Floating Storage and
Regasification Unit (“FSRU”) project in northern Greece
successfully completed its second and binding market test, an
important milestone toward the sanctioning of the project.”
COVID-19 Update
Operational update
GasLog’s main focus is on securing the health and safety of our
employees and ensuring safe and reliable operations for our
customers. To date, there have been no confirmed cases of COVID-19
infection amongst sea-going or shore-based personnel. During 2020
to date, extensive measures have been taken to limit the impact of
COVID-19 on GasLog’s business. These include:
- A dedicated task force established to manage the impact of
COVID-19 on all aspects of our business and operations and to
review and amend our business continuity plan as required;
- A company-wide “work from home” policy instituted for all
onshore employees; and
- Strict guidelines imposed, restricting access to all vessels
and suspending shore leave and crew changes from mid-March
2020.
As a result of these measures and the dedication of our
employees onshore and aboard our vessels, approximately 100% of our
fleet continues to be available for commercial use. These measures
have also allowed GasLog to opportunistically bring forward the
scheduled dry-dockings of three vessels such that their
dry-dockings were completed entirely during the slowdown of LNG
trade in February and March 2020.
Commercial update
Given the continuing impact of COVID-19 on economic activity and
energy demand, there is uncertainty regarding future LNG demand
and, consequently, near-term LNG shipping requirements.
- To date, we have not experienced any disruption to the charter
parties, including contracted revenues, for our term- or
spot-chartered vessels, as a result of COVID-19;
- Our vessels operating in the spot and short-term market are
currently chartered through to at least June 2020; and
- The combined impact of COVID-19 and normal seasonality may lead
to greater volatility in spot rates and to lower utilization of
vessels trading in the spot and short-term markets.
Financial update
COVID-19 has had a significant impact on the global capital and
bank credit markets, including access to and cost of liquidity.
- The recent fall in interest rates and the Norwegian Krone/U.S.
Dollar exchange rate as a result of central bank measures to
support economies affected by the COVID-19 pandemic and the
significant fall in oil prices, respectively, have resulted in an
increase in the mark-to-market derivative liabilities with respect
to our derivative instruments and a significant increase in cash
collateral posted with our swaps counterparties which amounted to
$81.2 million as of March 31, 2020; and
- There have been no other material impacts to date of the
COVID-19 pandemic on our financial position and we are continuing
the process of refinancing our bank loans maturing in April and
July 2021. We are also in discussion with our swaps counterparties
in order to identify and execute measures to reduce cash collateral
posted under the existing interest rate and cross-currency
swaps.
LNG Market Update and Outlook
LNG demand faced several headwinds in the first quarter of 2020
including a warmer than average winter in the northern hemisphere,
high inventory levels of natural gas and LNG in several of the
largest end markets for LNG and the outbreak of COVID-19, the
impact of which has had an uneven distribution around the world
during the year to date. For example, Chinese demand was 15 million
tonnes (“mt”) in the first quarter of 2020, a decrease of 5% over
the first quarter of 2019, according to Poten, but apparent demand
in April has increased year-on-year based on vessel tracking data,
including several cargoes exported from the U.S.. Meanwhile, demand
from Northern Asia more broadly (Japan, China, South Korea and
Taiwan) grew by approximately 1 mt in the first quarter or 3%
year-over-year. In addition, demand from India grew by nearly 2 mt
in the first quarter of 2020 (or 37%) as the country looked to take
advantage of historically low gas prices, although apparent demand
in April is likely to be lower year-on-year based on vessel
tracking data. Finally, demand from Europe grew by over 4 mt (or
37%) as gas pricing favored coal-to-gas switching for power
generation and LNG replaces indigenous gas production. In total,
LNG demand was 98 mt in the first quarter of 2020, compared to 89
mt in the first quarter of 2019, or an increase of 10%.
Wood Mackenzie currently expects global LNG demand to grow 21 mt
or 6% this year, slower than the 26 mt or 7% it anticipated earlier
this year prior to the global outbreak of COVID-19. Nonetheless,
the demand for LNG over the near-term continues to be uncertain as
many LNG importing countries either continue to have in effect
shelter-in-place orders which prevent the operation of businesses
deemed to be “non-essential” or are in the early stages of
reopening their economies. Consequently, measures of global
economic activity have declined significantly from comparable
periods in 2019. However, the longer-term outlook for LNG demand
remains favorable with demand growth of 92 mt estimated over the
2019-2025 timeframe, or compound annual growth of approximately 4%,
according to Wood Mackenzie.
Global LNG supply was approximately 98 mt in the first quarter
of 2020, an increase of 10 mt over the first quarter of 2019 (or
11%), primarily due to new supply additions in the U.S. (Cameron T1
and T2, Freeport T1, T2 and T3 and Elba Island), according to
estimates from Wood Mackenzie. LNG supply is estimated to grow by
22 mt this year as the third train of Cameron begins operations and
recent capacity additions continue to increase production. Further
ahead, approximately 97 mt of new LNG capacity is expected to begin
production during 2021-2025. However, Wood Mackenzie expects the
pace of new project sanctions to slow significantly in 2020 due to
the uncertainties caused by the COVID-19 outbreak in long-term
demand for LNG and low global energy prices, in particular crude
oil prices due to oversupply following a collapse in oil demand due
to the COVID-19 virus.
In the LNG shipping spot market, tri-fuel diesel electric vessel
(“TFDE”) headline rates, as reported by Clarksons, averaged $57,000
per day in the first quarter of 2020, a decrease from the averages
of $108,000 in the fourth quarter of 2019 and $59,500 in the first
quarter of 2019. Headline spot rates for steam turbine propulsion
(“Steam”) vessels averaged $40,000 per day in the first quarter of
2020, a decrease from the average of $78,000 per day in the fourth
quarter of 2019 but approximately in line with the $39,000 per day
observed in the first quarter of 2019. Slower than expected
LNG demand growth due in part to the impact of COVID-19 (as
detailed above), high global inventories of natural gas and LNG
following a warmer than average winter in the Northern Hemisphere
and limited opportunities for LNG arbitrage trading between
Atlantic and Pacific basins impacted headline spot rates in the
first quarter of 2020.
Clarksons currently assesses headline spot rates for TFDE and
Steam LNG carriers at $32,500 per day and $23,000 per day,
respectively. The COVID-19 outbreak has introduced significant
uncertainty regarding demand for LNG, and consequently, demand for
LNG shipping over the near term. The combined impact of the
COVID-19 outbreak and normal seasonality may lead to greater
volatility in spot rates and to lower utilization of vessels
trading in the spot and short-term markets, in particular Steam
vessels. In addition, global gas prices and gas price differentials
remain near historic lows in the key markets of North Asia and
Europe, limiting the opportunities for inter-basin arbitrage
trading and likely reducing average voyage distances as well as
potentially reducing global output of LNG over the near-term,
particularly in the U.S., where a number of cargo deferrals and/or
cancellations have been reported for this summer.
As of May 5, 2020, the orderbook totals 118 dedicated LNG
carriers (>100,000 cbm), according to estimates from Poten,
representing 22% of the on-the-water fleet. Of these, 74 vessels
(or 63%) have multi-year charters. The pace of newbuild ordering
has slowed significantly relative to 2018-19, with only 4
newbuildings ordered so far in 2020 and all of them ordered against
multi-year contracts, an encouraging development for the future
supply and demand balance of LNG carriers.
Alexandroupolis Project UpdateOn 23 December
2019, the board of directors of the Public Gas Corporation in
Greece (“DEPA”) approved the acquisition of a 20% stake in
Gastrade, which was completed in early 2020. Through this
participation, DEPA assumes an active role in the implementation of
the project together with the existing shareholders.
On March 26, 2020, Gastrade announced the successful conclusion
of the binding phase of the market test for reservation of capacity
at the floating LNG terminal being developed at Alexandroupolis in
northern Greece. This reservation of up to 2.6 billion cbm of
capacity for periods out to 15 years represents a key milestone for
the project.
Delivery of the GasLog WindsorOn April 1, 2020,
GasLog took delivery of the GasLog Windsor, a 180,000 cbm LNG
carrier with X-DF propulsion constructed by Samsung Heavy
Industries Co., Ltd. (“Samsung”). Despite the industrial disruption
in South Korea caused by the COVID-19 outbreak, the vessel was
delivered on time and on budget. Upon delivery, the vessel
immediately commenced its seven-year charter with Centrica.
Delivery of the GasLog WalesOn May 11, 2020,
GasLog is scheduled to take delivery of the GasLog Wales, a 180,000
cbm LNG carrier with X-DF propulsion constructed by Samsung. Upon
delivery, the vessel will immediately commence its 12-year charter
with JERA.
Dividend Declaration
On March 12, 2020, the board of directors declared a dividend on
the Series A Preference Shares of $0.546875 per share, or $2.5
million in the aggregate, payable on April 1, 2020 to holders of
record as of March 31, 2020. GasLog paid the declared dividend to
the transfer agent on April 1, 2020.
On May 6, 2020, the board of directors declared a quarterly cash
dividend of $0.05 per common share, or $4.0 million in the
aggregate, payable on May 28, 2020 to shareholders of record as of
May 18, 2020.
Office Relocation Update
In November 2019, GasLog announced plans to relocate more of its
employees including several members of senior management to
Piraeus, Greece, home of our operational platform, in order to
enhance execution, efficiency and operational excellence and to
reduce overheads. These plans are being executed as scheduled and
will be fully implemented in the second half of 2020, generating
annualized general and administrative savings of $6.0 million with
effect from 2021. For the quarter and the year ended December 31,
2019, the Group had recognized total restructuring costs of $4.7
million, the majority of which will be paid in 2020. In the three
months ended March 31, 2020, additional restructuring costs of $0.4
million were recognized.
Chief Financial Officer (“CFO”) Transition
Alastair Maxwell, CFO of GasLog and GasLog Partners, has
informed the Company that, as a result of the relocation of his
role to Piraeus, Greece, he will be stepping down from his position
on June 30, 2020. Achilleas Tasioulas, currently Deputy CFO, will
assume the responsibilities of CFO of GasLog and GasLog Partners on
July 1, 2020. Please see the separate press release of today’s date
on this matter.
Financial Summary
Amounts
in thousands of U.S. dollars except per share
data |
|
For the three months ended |
|
|
|
March 31, 2019 |
|
|
March 31, 2020 |
|
Revenues |
|
$ |
166,547 |
|
|
$ |
165,897 |
|
Profit/(loss) for
the period |
|
$ |
5,899 |
|
|
$ |
(39,437 |
) |
Adjusted
Profit(1) |
|
$ |
28,140 |
|
|
$ |
26,790 |
|
Adjusted
EBITDA(1) |
|
$ |
109,940 |
|
|
$ |
113,970 |
|
Loss attributable
to the owners of GasLog |
|
$ |
(10,947 |
) |
|
$ |
(51,479 |
) |
EPS, basic |
|
$ |
(0.17 |
) |
|
$ |
(0.67 |
) |
Adjusted
EPS(1) |
|
$ |
0.11 |
|
|
$ |
0.15 |
|
(1) Adjusted EBITDA, Adjusted Profit and Adjusted EPS are
non-GAAP financial measures and should not be used in isolation or
as a substitute for GasLog’s financial results presented in
accordance with IFRS. For definitions and reconciliations of these
measurements to the most directly comparable financial measures
calculated and presented in accordance with IFRS, please refer to
Exhibit II at the end of this press release.
There were 2,250 revenue operating days for the quarter ended
March 31, 2020, as compared to 2,350 revenue operating days
(including 540 days in the LNG carrier pooling agreement (the “Cool
Pool”) for the quarter ended March 31, 2019. The decrease in
revenue operating days was mainly driven by the increased
unchartered days from the vessels operating in the spot market,
including the vessels whose initial time charters have expired and
the increased off-hire days for dry-dockings, partially offset by
the increased operating days from the delivery of the GasLog
Gladstone on March 15, 2019 and the delivery of the GasLog Warsaw
on July 31, 2019.
Following the exit from the Cool Pool, management allocates
vessel revenues to two categories: (a) variable rate charters (“VR
Revenues”) and (b) fixed rate charters (“FR Revenues”). The
variable rate charter category contains vessels operating in the
LNG carrier spot and short-term market or those which have a
variable rate of hire across the charter period. The vessels in
this category during the first quarter of 2020 were the GasLog
Savannah, the GasLog Singapore, the GasLog Shanghai, the GasLog
Skagen, the GasLog Saratoga, the GasLog Salem, the GasLog Chelsea
and the Methane Alison Victoria.
Revenues were $165.9 million for the quarter ended March 31,
2020 ($166.5 million for the quarter ended March 31, 2019). The
decrease was mainly driven by the expiration of the initial time
charters of the Gaslog Saratoga, the Methane Jane Elizabeth and the
Methane Alison Victoria, increased off-hire days for scheduled
dry-dockings and a further decrease in revenues from our vessels
operating in the spot market in both periods. The above decreases
were partially offset by the full operation of the GasLog
Gladstone, delivered on March 15, 2019, the GasLog Warsaw,
delivered on July 31, 2019, and the increased revenues from the
remaining vessels in our fleet.
For the quarter ended March 31, 2020, an analysis of revenue
operating days, revenues and voyage expenses and commissions per
category of charter is presented below:
|
|
|
|
|
|
|
|
|
|
For the three months endedMarch 31,
2020 |
|
Amounts in thousands of U.S. dollars |
|
|
|
Variable rate charters |
|
|
Fixed rate charters |
|
Available days
(*) |
|
|
|
675 |
|
|
1,781 |
|
Revenue
operating days(**) |
|
|
|
469 |
|
|
1,781 |
|
Revenues |
|
|
|
31,548 |
|
|
134,349 |
|
Voyage
expenses and commissions |
|
|
|
(4,708 |
) |
|
(2,765 |
) |
(*) Available days represent total calendar days in the period
after deducting off-hire days where vessels are undergoing
dry-dockings and unavailable days, i.e. days before and after a
dry-docking where the vessel has limited ability for chartering
opportunities. (**) Revenue operating days represent total
available days after deducting unchartered days.
In addition, GasLog recognized gross revenues and gross voyage
expenses and commissions of $32.1 million and $4.7 million,
respectively, from the operation of its vessels in the Cool Pool
during the quarter ended March 31, 2019. Net pool allocation was a
negative $6.7 million for the quarter ended March 31, 2019.
Voyage expenses and commissions were $7.5 million for the
quarter ended March 31, 2020 ($6.9 million for the quarter ended
March 31, 2019). The increase resulted from the increased bunkers’
consumption of our vessels operating in the spot market.
Vessel operating and supervision costs were $35.1 million for
the quarter ended March 31, 2020 ($33.0 million for the quarter
ended March 31, 2019). The increase in absolute terms was mainly
attributable to the increase in crew wages due to the delivery of
the GasLog Warsaw on July 31, 2019 and increased scheduled
technical and maintenance costs related to engine maintenance and
costs related to dry-dockings, partially offset by the favorable
movement of the Euro (“EUR”)/USD exchange rate. Daily operating
costs per vessel decreased from $14,550 per ownership day
(excluding the Solaris which is managed by Shell) for the quarter
ended March 31, 2019, to $14,266 per ownership day (excluding the
Solaris which is managed by Shell) for the three-month period ended
March 31, 2020. Ownership days represent total calendar days for
our owned and bareboat fleet.
General and administrative expenses were $9.6 million for the
quarter ended March 31, 2020 ($10.4 million for the quarter ended
March 31, 2019). The decrease is mainly attributable to foreign
exchange differences. Daily general and administrative expenses per
vessel, excluding the effect of the restructuring costs, decreased
from $4,404 per ownership day (as defined above) for the quarter
ended March 31, 2019, to $3,601 per ownership day (as defined
above) for the quarter ended March 31, 2020.
Depreciation was $41.5 million for the quarter ended March 31,
2020 ($39.6 million for the quarter ended March 31, 2019). The
increase in depreciation resulted mainly from the increase in the
average number of vessels in our fleet in the quarter ended March
31, 2020, compared to the same quarter in 2019, which was partially
offset by the impairment charges recognized in the fourth quarter
of 2019, which reduced the carrying value of Steam vessels.
Financial costs were $41.4 million for the quarter ended March
31, 2020 ($45.5 million for the quarter ended March 31, 2019). The
decrease was mainly attributable to the $4.0 million net unrealized
foreign exchange gains on cash and bonds included in other
financial costs and the decreased weighted average interest rate
deriving from the downward movement of the LIBOR. An analysis of
the financial costs is presented below:
(All
amounts expressed in thousands of U.S. dollars) |
|
|
|
For the three months ended |
|
|
|
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
|
Financial costs |
|
|
|
|
|
|
|
|
|
|
|
Amortization and write-off of deferred loan/bond issuance
costs/premium |
|
|
$ |
(4,161 |
) |
$ |
(3,817 |
) |
|
Interest expense on loans |
|
|
|
(30,591 |
) |
|
(26,826 |
) |
|
Interest expense on bonds and realized loss on cross-currency swaps
(“CCS”) |
|
|
|
(7,483 |
) |
|
(9,484 |
) |
|
Lease charge |
|
|
|
(2,629 |
) |
|
(2,549 |
) |
|
Loss arising on bond repurchase |
|
|
|
— |
|
|
(1,937 |
) |
|
Other financial costs, net |
|
|
|
(643 |
) |
|
3,172 |
|
|
Total |
|
|
|
|
$ |
(45,507 |
) |
$ |
(41,441 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on derivatives was $71.1 million for the quarter ended
March 31, 2020 ($20.2 million loss for the quarter ended March 31,
2019). The increase in loss on derivatives in the first quarter of
2020, as compared to the first quarter of 2019, is mainly
attributable to an increase of $50.1 million in loss from
marked-to-market valuation of our derivative financial instruments
carried at fair value through profit or loss, derived from changes
in the LIBOR curve. An analysis of gain/(loss) on derivatives is
presented below:
(All
amounts expressed in thousands of U.S. dollars) |
|
|
|
For the three months ended |
|
|
|
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
|
Loss
on derivatives |
|
|
|
|
|
|
|
|
|
|
|
Realized gain/(loss) on derivatives held for trading |
|
|
$ |
1,735 |
|
$ |
(869 |
) |
|
Realized loss on forward foreign exchange contracts held for
trading |
|
|
|
(876 |
) |
|
(206 |
) |
|
Unrealized loss on derivative financial instruments held for
trading |
|
|
|
(21,150 |
) |
|
(71,332 |
) |
|
Ineffective portion of cash flow hedges |
|
|
|
47 |
|
|
1,283 |
|
|
Total |
|
|
|
|
$ |
(20,244 |
) |
$ |
(71,124 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period was $39.4 million for the quarter ended
March 31, 2020 ($5.9 million profit for the quarter ended March 31,
2019). This decrease in profit is mainly attributable to the
unfavorable movement in non-cash marked-to-market valuations of our
derivative financial instruments in the first quarter of 2020,
partially offset by the decrease in finance costs.
Adjusted Profit(1) was $26.8 million for the quarter ended March
31, 2020 ($28.1 million for the quarter ended March 31, 2019)
adjusted for the effects of the write-off of unamortized bond fees,
the net foreign exchange gains, the net unrealized foreign exchange
gains on cash and bonds, the restructuring costs and the non-cash
loss on derivatives.
Loss attributable to the owners of GasLog was $51.5 million for
the quarter ended March 31, 2020 ($10.9 million for the quarter
ended March 31, 2019). The increase in loss attributable to the
owners of GasLog resulted mainly from the respective movements in
loss for the period mentioned above.
Adjusted EBITDA(1) was $114.0 million for the quarter ended
March 31, 2020 ($109.9 million for the quarter ended March 31,
2019).
EPS was a loss of $0.67 for the quarter ended
March 31, 2020 ($0.17 loss for the quarter ended March 31, 2019).
The increase in loss per share is mainly attributable to the
respective movements in loss attributable to the owners of GasLog
discussed above.
Adjusted EPS(1) was $0.15 for the quarter ended March 31, 2020
($0.11 for the quarter ended March 31, 2019), adjusted for the
effects of the write-off of unamortized bond fees, the net foreign
exchange gains, the net unrealized foreign exchange gains on cash
and bonds, the restructuring costs and the non-cash loss on
derivatives.
(1) Adjusted Profit, Adjusted EBITDA and Adjusted EPS are
non-GAAP financial measures and should not be used in isolation or
as a substitute for GasLog’s financial results presented in
accordance with IFRS. For definitions and reconciliations of these
measurements to the most directly comparable financial measures
calculated and presented in accordance with IFRS, please refer to
Exhibit II at the end of this press release.
Contracted Charter Revenues
As of March 31, 2020, the total future firm contracted revenue
stood at $3.8 billion(1), including the 15 vessels currently owned
by GasLog Partners.
(1) Contracted revenue calculations assume: (a) 365 revenue days
per annum, with 30 off-hire days when the ship undergoes scheduled
dry-docking; (b) all LNG carriers on order are delivered on
schedule; (c) no exercise of any option to extend the terms of
charters; and (d) where charters are based on a variable rate of
hire within an agreed range during the charter period, the lower
end of the range.
Liquidity and Capital Resources
As of March 31, 2020, GasLog had $252.2 million of cash and cash
equivalents, of which $150.4 million was restricted cash, in
relation to the amount drawn for the delivery of the GasLog Windsor
until her delivery from the shipyard on April 1, 2020, $52.6
million was held in time deposits and the remaining balance in
current accounts. In addition, an amount of $81.2 million was held
as cash collateral with respect to our derivative instruments and
is included in Other non-current assets and Prepayments and other
current assets.
On January 13, 2020, GasLog completed the partial exchange of
$10.0 million of the outstanding 8.875% senior unsecured notes due
2022 (the “8.875% Senior Notes”) for new senior unsecured bonds due
in 2024 (the “NOK 2024 Bonds”). On January 31, 2020, GasLog
repurchased and cancelled NOK 434,000 of the outstanding senior
unsecured bonds due May 2021 (the “NOK 2021 Bonds”) at a price of
104.0% of par value, resulting in a loss of $1.9 million.
On February 13, 2020, on March 13, 2020 and on March 18, 2020,
GasLog drew down $23.3 million, $50.7 million and $26.0 million,
respectively under the revolving credit facility of up to $1.1
billion entered into on July 19, 2016 (the “Legacy Facility
Refinancing”). On March 26, 2020, GasLog drew $152.5 million under
the facility signed on December 12, 2019 with an Export Credit
Agency-backed debt financing of $1.1 billion with 13 international
banks to provide the debt funding for its current newbuilding
program (the “Newbuilding Facility”), to partially finance the
delivery of the GasLog Windsor.
As of March 31, 2020, there was undrawn available capacity of
$900.3 million under the Newbuilding Facility. In addition, there
was unused availability of $2.0 million under the five-year
amortizing revolving credit facility entered into by the
Partnership on February 20, 2019 (the “2019 Partnership
Facility”).
As of March 31, 2020, GasLog had an aggregate of $3.2 billion of
indebtedness outstanding under its credit facilities and bond
agreements, of which $214.7 million was repayable within one year,
and $203.1 million of lease liabilities, of which $9.7 million was
payable within one year.
As of March 31, 2020, the total remaining balance of the
contract prices of the seven LNG carriers on order was $1,085.4
million (including the GasLog Windsor which was delivered on April
1, 2020), which GasLog expects to be funded with the Newbuilding
Facility, cash balances and cash from operations.
As of March 31, 2020, GasLog’s current assets totaled $320.6
million, while current liabilities totaled $381.4 million,
resulting in a negative working capital position of $60.8 million.
Management monitors the Company’s liquidity position throughout the
year to ensure that it has access to sufficient funds to meet its
forecast cash requirements, including newbuilding and debt service
commitments, and to monitor compliance with the financial covenants
within its loan and bond facilities. Taking into account current
and expected volatile market conditions, we anticipate that our
primary sources of funds over the next twelve months will be
available cash, cash from operations and bank borrowings under
existing, refinanced or new debt facilities, as well as public
equity or debt instruments subject to a significant recovery in
capital market conditions. We are continuing the process of
refinancing our bank loans maturing in April and July 2021 and we
are in discussion with our swaps counterparties in order to
identify and execute measures to reduce cash collateral posted
under the existing interest rate and cross currency swaps. We
believe that these anticipated sources of funds will be sufficient
to meet our liquidity needs and to comply with our bank loan and
bond covenants for at least twelve months from the end of the
reporting period, although there can be no assurance that we will
be able to obtain such debt or equity financing or release of
collateral on terms acceptable to
us.
GasLog has hedged 42.4% of its expected floating interest rate
exposure on its outstanding debt (excluding the lease liability) as
of March 31, 2020.
Future Deliveries
As of May 7, 2020, GasLog has six newbuildings on order at
Samsung which are on schedule and within budget:
LNG Carrier |
|
Year Built(1) |
|
Shipyard |
|
Cargo Capacity (cbm) |
|
Charterer |
|
Propulsion |
|
Estimated Charter Expiration(2) |
|
|
GasLog Wales |
|
Q2 2020 |
|
Samsung |
|
180,000 |
|
JERA |
|
X-DF |
|
2032 |
Hull No.
2262 |
|
Q3 2020 |
|
Samsung |
|
180,000 |
|
Centrica |
|
X-DF |
|
2027 |
Hull No.
2300 |
|
Q4 2020 |
|
Samsung |
|
174,000 |
|
Cheniere(3) |
|
X-DF |
|
2027 |
Hull No.
2301 |
|
Q1 2021 |
|
Samsung |
|
174,000 |
|
Cheniere(3) |
|
X-DF |
|
2028 |
Hull No.
2311 |
|
Q2 2021 |
|
Samsung |
|
180,000 |
|
Cheniere(3) |
|
X-DF |
|
2028 |
Hull No.
2312 |
|
Q3 2021 |
|
Samsung |
|
180,000 |
|
Cheniere(3) |
|
X-DF |
|
2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
____________
- Expected delivery quarters are presented.
(2) Charter expiration to be
determined based upon actual date of delivery.
(3) The vessel is chartered to a
wholly owned subsidiary of Cheniere Energy, Inc. (“Cheniere”).
Conference Call
GasLog and GasLog Partners will host a joint conference call to
discuss their results for the first quarter of 2020 at 8:30 a.m.
EST (1:30 p.m. BST) on Thursday, May 7, 2020. Senior management of
GasLog and GasLog Partners will review the operational and
financial performance of both companies. The presentation will be
followed by a Q&A session.
The dial-in numbers for the conference call are as follows:
+1 855 253 8928 (USA)+44 20 3107 0289 (United Kingdom)+33 1 70
80 71 53 (France)+852 5819 4851 (Hong Kong)+47 2396 4173 (Oslo)
Conference ID: 8392466
A live webcast of the conference call will also be available on
the Investor Relations page of both the GasLog
(http://www.gaslogltd.com/investors) and GasLog Partners
(http://www.gaslogmlp.com/investors) websites.
For those unable to participate in the conference call, a replay
of the webcast will be available on the Investor Relations pages of
the companies’ websites as referenced above.
About GasLog
GasLog is an international owner, operator and manager of LNG
carriers providing support to international energy companies as
part of their LNG logistics chain. GasLog’s consolidated fleet
consists of 35 LNG carriers. Of these vessels, 19 (13 on the water
and six on order) are owned by GasLog, one has been sold to a
subsidiary of Mitsui & Co., Ltd. and leased back by GasLog
under a long-term bareboat charter and the remaining 15 LNG
carriers are owned by the Company’s subsidiary, GasLog Partners.
GasLog’s principal executive offices are at 69 Akti Miaouli, 18537
Piraeus, Greece. Visit GasLog’s website at
http://www.gaslogltd.com.
Forward Looking Statements
All statements in this press release that are not statements of
historical fact are “forward-looking statements” within the meaning
of the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements that address
activities, events or developments that the Company expects,
projects, believes or anticipates will or may occur in the future,
particularly in relation to our operations, cash flows, financial
position, liquidity and cash available for dividends or
distributions, plans, strategies, business prospects and changes
and trends in our business and the markets in which we operate. We
caution that these forward-looking statements represent our
estimates and assumptions only as of the date of this press
release, about factors that are beyond our ability to control or
predict, and are not intended to give any assurance as to future
results. Any of these factors or a combination of these factors
could materially affect future results of operations and the
ultimate accuracy of the forward-looking statements. Accordingly,
you should not unduly rely on any forward-looking statements.
Factors that might cause future results and outcomes to differ
include, but are not limited to, the following:
- general LNG shipping market conditions and trends, including
spot and multi-year charter rates, ship values, factors affecting
supply and demand of LNG and LNG shipping, including geopolitical
events, technological advancements and opportunities for the
profitable operations of LNG carriers;
- fluctuations in charter hire rates, vessel utilization and
vessel values;
- increased exposure to the spot market and fluctuations in spot
charter rates;
- changes in our operating expenses, including crew wages,
maintenance, dry-docking and insurance costs and bunker
prices;
- number of off-hire days and dry-docking requirements including
our ability to complete scheduled dry-dockings on time and within
budget;
- our ability to maintain long-term relationships and enter into
time charters with new and existing customers;
- potential disruption to the LNG, LNG shipping and financial
markets caused by global shutdown as a result of the COVID-19
pandemic;
- fluctuations in prices for crude oil, petroleum products and
natural gas;
- changes in the ownership of our charterers;
- our customers’ performance of their obligations under our time
charters and other contracts;
- our future operating performance and expenses, financial
condition, liquidity and cash available for dividends and
distributions;
- our ability to obtain debt and equity financing on acceptable
terms to fund capital expenditures, acquisitions and other
corporate activities, funding by banks of their financial
commitments, and our ability to meet our restrictive covenants and
other obligations under our credit facilities;
- future, pending or recent acquisitions of or orders for ships
or other assets, business strategy, areas of possible expansion and
expected capital spending;
- the time that it may take to construct and deliver newbuildings
and the useful lives of our ships;
- fluctuations in currencies and interest rates;
- risks inherent in ship operation, including the discharge of
pollutants;
- the impact of environmental liabilities on us and the shipping
industry, including climate change;
- our ability to retain key employees and the availability of
skilled labour, ship crews and management;
- potential disruption of shipping routes due to accidents,
diseases, pandemics, political events, piracy or acts by
terrorists;
- potential liability from future litigation;
- any malfunction or disruption of information technology systems
and networks that our operations rely on or any impact of a
possible cybersecurity event; and
- other risks and uncertainties described in the Company’s Annual
Report on Form 20-F filed with the SEC on March 6, 2020 and
available at http://www.sec.gov.
• our ability to maximize the use of our
vessels, including the re-deployment or disposition of vessels
which are not under multi-year charters, including the risk that
certain of our vessels may no longer have the latest technology at
such time which may impact our ability to secure employment for
such vessels as well as the rate at which we can charter such
vessels;• planned capital expenditures and
availability of capital resources to fund capital
expenditures;• the expected cost of and our ability to
comply with environmental and regulatory conditions, including with
respect to emissions of air pollutants and greenhouse gases, as
well as future changes in such requirements or other actions taken
by regulatory authorities, governmental organizations,
classification societies and standards imposed by our charterers
applicable to our business;
We undertake no obligation to update or revise any
forward-looking statements contained in this press release, whether
as a result of new information, future events, a change in our
views or expectations or otherwise, except as required by
applicable law. New factors emerge from time to time, and it is not
possible for us to predict all of these factors. Further, we cannot
assess the impact of each such factor on our business or the extent
to which any factor, or combination of factors, may cause actual
results to be materially different from those contained in any
forward-looking statement.
The declaration and payment of dividends are at all times
subject to the discretion of our board of directors and will depend
on, amongst other things, risks and uncertainties described above,
restrictions in our credit facilities, the provisions of Bermuda
law and such other factors as our board of directors may deem
relevant.
Contacts:
Joseph NelsonHead of Investor RelationsPhone: +1
212-223-0643
Email: ir@gaslogltd.com
EXHIBIT I - Unaudited Interim Financial
Information
Unaudited condensed consolidated statements of financial
positionAs of December 31, 2019 and March 31,
2020(Amounts expressed in thousands of U.S.
Dollars)
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2019 |
|
March 31, 2020 |
|
Assets |
|
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
|
|
Goodwill |
|
|
|
9,511 |
|
|
9,511 |
|
Investment in
associates |
|
|
|
21,620 |
|
|
21,151 |
|
Deferred
financing costs |
|
|
|
11,592 |
|
|
10,886 |
|
Other non-current
assets |
|
|
|
24,221 |
|
|
58,787 |
|
Derivative
financial instruments |
|
|
|
3,572 |
|
|
— |
|
Tangible fixed
assets |
|
|
|
4,427,065 |
|
|
4,401,977 |
|
Vessels under
construction |
|
|
|
203,323 |
|
|
252,319 |
|
Right-of-use
assets |
|
|
|
206,495 |
|
|
206,607 |
|
Total
non-current assets |
|
|
|
4,907,399 |
|
|
4,961,238 |
|
Current
assets |
|
|
|
|
|
|
|
|
Trade and other
receivables |
|
|
|
24,900 |
|
|
27,712 |
|
Dividends
receivable and other amounts due from related parties |
|
|
|
573 |
|
|
1,121 |
|
Derivative
financial instruments |
|
|
|
429 |
|
|
168 |
|
Inventories |
|
|
|
8,172 |
|
|
11,038 |
|
Prepayments and
other current assets |
|
|
|
13,475 |
|
|
28,365 |
|
Short-term
investments |
|
|
|
4,500 |
|
|
— |
|
Cash and cash
equivalents |
|
|
|
263,747 |
|
|
252,145 |
|
Total
current assets |
|
|
|
315,796 |
|
|
320,549 |
|
Total
assets |
|
|
|
5,223,195 |
|
|
5,281,787 |
|
Equity
and liabilities |
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
Preference
shares |
|
|
|
46 |
|
|
46 |
|
Share
capital |
|
|
|
810 |
|
|
810 |
|
Contributed
surplus |
|
|
|
760,671 |
|
|
746,073 |
|
Reserves |
|
|
|
16,799 |
|
|
13,854 |
|
Treasury
shares |
|
|
|
(2,159 |
) |
|
(4,159 |
) |
Accumulated
deficit |
|
|
|
(87,832 |
) |
|
(139,311 |
) |
Equity
attributable to owners of the Group |
|
|
|
688,335 |
|
|
617,313 |
|
Non-controlling
interests |
|
|
|
961,518 |
|
|
946,861 |
|
Total
equity |
|
|
|
1,649,853 |
|
|
1,564,174 |
|
Current
liabilities |
|
|
|
|
|
|
|
|
Trade accounts
payable |
|
|
|
27,615 |
|
|
38,993 |
|
Ship management
creditors |
|
|
|
601 |
|
|
914 |
|
Amounts due to
related parties |
|
|
|
200 |
|
|
189 |
|
Derivative
financial instruments |
|
|
|
8,095 |
|
|
28,364 |
|
Other payables
and accruals |
|
|
|
136,242 |
|
|
88,580 |
|
Borrowings,
current portion |
|
|
|
255,422 |
|
|
214,700 |
|
Lease liability,
current portion |
|
|
|
9,363 |
|
|
9,694 |
|
Total
current liabilities |
|
|
|
437,538 |
|
|
381,434 |
|
Non-current liabilities |
|
|
|
|
|
|
|
|
Derivative
financial instruments |
|
|
|
41,837 |
|
|
108,334 |
|
Borrowings,
non-current portion |
|
|
|
2,891,973 |
|
|
3,028,319 |
|
Lease liability,
non-current portion |
|
|
|
195,567 |
|
|
193,445 |
|
Other non-current
liabilities |
|
|
|
6,427 |
|
|
6,081 |
|
Total
non-current liabilities |
|
|
|
3,135,804 |
|
|
3,336,179 |
|
Total
equity and liabilities |
|
|
|
5,223,195 |
|
|
5,281,787 |
|
Unaudited condensed consolidated statements of profit or
lossFor the three months ended March
31, 2019 and 2020(Amounts
expressed in thousands of U.S. Dollars, except per share
data)
|
|
|
|
|
For the three months ended |
|
|
|
|
|
|
March 31,
2019 |
|
March 31,
2020 |
|
Revenues |
|
|
|
|
|
|
166,547 |
|
|
165,897 |
|
Net pool
allocation |
|
|
|
|
|
|
(6,738 |
) |
|
— |
|
Voyage expenses
and commissions |
|
|
|
|
|
|
(6,917 |
) |
|
(7,473 |
) |
Vessel operating
and supervision costs |
|
|
|
|
|
|
(32,970 |
) |
|
(35,052 |
) |
Depreciation |
|
|
|
|
|
|
(39,599 |
) |
|
(41,497 |
) |
General and
administrative expenses |
|
|
|
|
|
|
(10,377 |
) |
|
(9,621 |
) |
Profit
from operations |
|
|
|
|
|
|
69,946 |
|
|
72,254 |
|
Financial
costs |
|
|
|
|
|
|
(45,507 |
) |
|
(41,441 |
) |
Financial
income |
|
|
|
|
|
|
1,459 |
|
|
468 |
|
Loss on
derivatives |
|
|
|
|
|
|
(20,244 |
) |
|
(71,124 |
) |
Share of profit
of associates |
|
|
|
|
|
|
245 |
|
|
406 |
|
Total
other expenses, net |
|
|
|
|
|
|
(64,047 |
) |
|
(111,691 |
) |
Profit/(loss) for the period |
|
|
|
|
|
|
5,899 |
|
|
(39,437 |
) |
Attributable
to: |
|
|
|
|
|
|
|
|
|
|
|
Owners of the
Group |
|
|
|
|
|
|
(10,947 |
) |
|
(51,479 |
) |
Non-controlling
interests |
|
|
|
|
|
|
16,846 |
|
|
12,042 |
|
|
|
|
|
|
|
|
5,899 |
|
|
(39,437 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Loss per
share – basic and diluted |
|
|
|
|
|
|
(0.17 |
) |
|
(0.67 |
) |
Unaudited condensed consolidated statements of cash
flowsFor the three months ended March
31, 2019 and
2020(Amounts expressed in thousands of U.S.
Dollars)
|
|
|
|
For the three months ended |
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
Cash
flows from operating activities: |
|
|
|
|
|
|
|
|
|
|
Profit/(loss)
for the period |
|
|
|
|
|
5,899 |
|
|
(39,437) |
|
Adjustments
for: |
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
39,599 |
|
|
41,497 |
|
Share of
profit of associates |
|
|
|
|
|
(245 |
) |
|
(406 |
) |
Financial
income |
|
|
|
|
|
(1,459 |
) |
|
(468 |
) |
Financial
costs |
|
|
|
|
|
45,507 |
|
|
41,441 |
|
Unrealized
foreign exchange losses on cash and cash equivalents |
|
|
|
|
|
131 |
|
|
— |
|
Unrealized
loss on derivative financial instruments held for trading including
ineffective portion of cash flow hedges |
|
|
|
|
|
21,103 |
|
|
70,049 |
|
Share-based
compensation |
|
|
|
|
|
1,322 |
|
|
1,346 |
|
|
|
|
|
|
|
111,857 |
|
|
114,022 |
|
Movements in
working capital |
|
|
|
|
|
(11,676 |
) |
|
(87,051 |
) |
Cash
provided by operations |
|
|
|
|
|
100,181 |
|
|
26,971 |
|
Interest
paid |
|
|
|
|
|
(57,467 |
) |
|
(57,156 |
) |
Net
cash provided by/(used in) operating activities |
|
|
|
|
|
42,714 |
|
|
(30,185 |
) |
Cash
flows from investing activities: |
|
|
|
|
|
|
|
|
|
|
Payments for
tangible fixed assets and vessels under construction |
|
|
|
|
|
(220,549 |
) |
|
(59,685 |
) |
Return of
capital expenditures |
|
|
|
|
|
5,629 |
|
|
— |
|
Payments for
right-of-use assets |
|
|
|
|
|
— |
|
|
(980 |
) |
Dividends
received from associate |
|
|
|
|
|
538 |
|
|
450 |
|
Purchase of
short-term investments |
|
|
|
|
|
(10,000 |
) |
|
— |
|
Maturity of
short-term investments |
|
|
|
|
|
25,000 |
|
|
4,500 |
|
Financial
income received |
|
|
|
|
|
1,363 |
|
|
572 |
|
Net
cash used in investing activities |
|
|
|
|
|
(198,019 |
) |
|
(55,143 |
) |
Cash
flows from financing activities: |
|
|
|
|
|
|
|
|
|
|
Proceeds from
bank loans |
|
|
|
|
|
525,805 |
|
|
252,525 |
|
Bank loan and
bond repayments |
|
|
|
|
|
(426,208 |
) |
|
(124,116 |
) |
Payment for
bond repurchase at a premium |
|
|
|
|
|
— |
|
|
(1,937 |
) |
Payment for
CCS termination |
|
|
|
|
|
— |
|
|
(4,051 |
) |
Payment of
loan issuance costs |
|
|
|
|
|
(7,780 |
) |
|
(3,188 |
) |
Payment of
equity raising costs |
|
|
|
|
|
(668 |
) |
|
— |
|
Dividends
paid |
|
|
|
|
|
(41,418 |
) |
|
(37,780 |
) |
Purchase of
treasury shares |
|
|
|
|
|
(3,751 |
) |
|
(2,996 |
) |
Payments for
lease liability |
|
|
|
|
|
(2,388 |
) |
|
(2,508 |
) |
Net
cash provided by financing activities |
|
|
|
|
|
43,592 |
|
|
75,949 |
|
Effects of
exchange rate changes on cash and cash equivalents |
|
|
|
|
|
(131 |
) |
|
(2,223 |
) |
Decrease in cash and cash equivalents |
|
|
|
|
|
(111,844 |
) |
|
(11,602 |
) |
Cash and cash
equivalents, beginning of the period |
|
|
|
|
|
342,594 |
|
|
263,747 |
|
Cash
and cash equivalents, end of the period |
|
|
|
|
|
230,750 |
|
|
252,145 |
|
EXHIBIT II
Non-GAAP Financial Measures:
EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted
EPS
EBITDA is defined as earnings before depreciation, amortization,
financial income and costs, gain/loss on derivatives and taxes.
Adjusted EBITDA is defined as EBITDA before foreign exchange
gains/losses, impairment loss on vessels and restructuring costs.
Adjusted Profit represents earnings before write-off and
accelerated amortization of unamortized loan fees/bond fees and
premium, foreign exchange gains/losses, unrealized foreign exchange
losses on cash and bond, impairment loss on vessels, restructuring
costs and non-cash gain/loss on derivatives that includes (if any)
(a) unrealized gain/loss on derivative financial instruments held
for trading, (b) recycled loss of cash flow hedges reclassified to
profit or loss and (c) ineffective portion of cash flow hedges.
Adjusted EPS represents earnings attributable to owners of the
Group before write-off and accelerated amortization of unamortized
loan/bond fees and premium, foreign exchange gains/losses,
unrealized foreign exchange losses on cash and bond, impairment
loss on vessels attributable to the owners of the Group,
restructuring costs and non-cash gain/loss on derivatives as
defined above, divided by the weighted average number of shares
outstanding. EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted
EPS are non-GAAP financial measures that are used as supplemental
financial measures by management and external users of financial
statements, such as investors, to assess our financial and
operating performance. We believe that these non-GAAP financial
measures assist our management and investors by increasing the
comparability of our performance from period to period. We believe
that including EBITDA, Adjusted EBITDA, Adjusted Profit and
Adjusted EPS assists our management and investors in (i)
understanding and analyzing the results of our operating and
business performance, (ii) selecting between investing in us and
other investment alternatives and (iii) monitoring our ongoing
financial and operational strength in assessing whether to purchase
and/or to continue to hold our common shares. This is achieved by
excluding the potentially disparate effects between periods of, in
the case of EBITDA and Adjusted EBITDA, financial costs, gain/loss
on derivatives, taxes, depreciation and amortization; in the case
of Adjusted EBITDA, foreign exchange gains/losses, impairment loss
on vessels and restructuring costs; and in the case of Adjusted
Profit and Adjusted EPS, write-off and accelerated amortization of
unamortized loan/bond fees and premium, foreign exchange
gains/losses, unrealized foreign exchange losses on cash and bond,
impairment loss on vessels, restructuring costs and non-cash
gain/loss on derivatives, which items are affected by various and
possibly changing financing methods, financial market conditions,
capital structure and historical cost basis, and which items may
significantly affect results of operations between periods. In the
current period, impairment loss on vessels and restructuring costs
in particular are excluded from Adjusted EBITDA, Adjusted profit
and Adjusted EPS because impairments of long-lived assets, which
represent the excess of their carrying amount over the amount that
is expected to be recovered from them in the future, and
restructuring costs, which reflect specific actions taken by
management to improve the Group’s future profitability, are
non-cash charges and non-recurring operating expenses,
respectively, that we believe reduce the comparability of our
operating and business performance across periods. In addition,
unrealized foreign exchange losses on cash and bond, are separately
adjusted in the current period, while in the past foreign exchange
losses on cash were included in foreign exchange gains/losses and
unrealized foreign exchange losses on bond did not exist.
EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted EPS have
limitations as analytical tools and should not be considered as
alternatives to, or as substitutes for, or superior to, profit,
profit from operations, earnings per share or any other measure of
operating performance presented in accordance with IFRS. Some of
these limitations include the fact that they do not reflect (i) our
cash expenditures or future requirements for capital expenditures
or contractual commitments, (ii) changes in, or cash requirements
for, our working capital needs and (iii) the cash requirements
necessary to service interest or principal payments on our debt.
Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will have to be replaced in
the future, and EBITDA and Adjusted EBITDA do not reflect any cash
requirements for such replacements. EBITDA, Adjusted EBITDA,
Adjusted Profit and Adjusted EPS are not adjusted for all non-cash
income or expense items that are reflected in our statements of
cash flows and other companies in our industry may calculate these
measures differently than we do, limiting their usefulness as a
comparative measure.
In evaluating Adjusted EBITDA, Adjusted Profit and Adjusted EPS,
you should be aware that in the future we may incur expenses that
are the same as, or similar to, some of the adjustments in this
presentation. Our presentation of Adjusted EBITDA, Adjusted Profit
and Adjusted EPS should not be construed as an inference that our
future results will be unaffected by the excluded items. Therefore,
the non-GAAP financial measures as presented below may not be
comparable to similarly titled measures of other companies in the
shipping or other industries.
Reconciliation of Profit/(loss) to EBITDA and
Adjusted EBITDA:(Amounts expressed in
thousands of U.S. Dollars)
|
|
|
|
For the three months ended |
|
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
Profit/(loss) for
the period |
|
|
|
|
|
5,899 |
|
|
(39,437 |
) |
Depreciation |
|
|
|
|
|
39,599 |
|
|
41,497 |
|
Financial
costs |
|
|
|
|
|
45,507 |
|
|
41,441 |
|
Financial
income |
|
|
|
|
|
(1,459 |
) |
|
(468 |
) |
Loss on
derivatives |
|
|
|
|
|
20,244 |
|
|
71,124 |
|
EBITDA |
|
|
|
|
|
109,790 |
|
|
114,157 |
|
Foreign exchange
losses/(gains), net |
|
|
|
|
|
150 |
|
|
(632 |
) |
Restructuring
costs |
|
|
|
|
|
— |
|
|
445 |
|
Adjusted
EBITDA |
|
|
|
|
|
109,940 |
|
|
113,970 |
|
Reconciliation of Profit/(loss) to Adjusted
Profit:(Amounts expressed in thousands of U.S.
Dollars)
|
|
|
|
For the three months ended |
|
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
Profit/(loss) for
the period |
|
|
|
|
|
5,899 |
|
|
(39,437 |
) |
Non-cash loss on
derivatives |
|
|
|
|
|
21,103 |
|
|
70,049 |
|
Write-off of
unamortized loan/bond fees |
|
|
|
|
|
988 |
|
|
316 |
|
Foreign exchange
losses/(gains), net |
|
|
|
|
|
150 |
|
|
(632 |
) |
Unrealized
foreign exchange gains, net on cash and bonds |
|
|
|
|
|
— |
|
|
(3,951 |
) |
Restructuring
costs |
|
|
|
|
|
— |
|
|
445 |
|
Adjusted
Profit |
|
|
|
|
|
28,140 |
|
|
26,790 |
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Loss Per Share to Adjusted Earnings
Per Share:
(Amounts expressed in thousands of U.S. Dollars, except
shares and per share data)
|
|
|
|
For the three months ended |
|
|
|
|
|
March 31, 2019 |
|
March 31, 2020 |
|
Loss for the
period attributable to owners of the Group |
|
|
|
|
|
(10,947 |
) |
|
(51,479 |
) |
Less: |
|
|
|
|
|
|
|
|
|
|
Dividend on
preference shares |
|
|
|
|
|
(2,516 |
) |
|
(2,516 |
) |
Loss for the
period available to owners of the Group used in EPS
calculation |
|
|
|
|
|
(13,463 |
) |
|
(53,995 |
) |
Weighted average
number of shares outstanding, basic |
|
|
|
|
|
80,825,637 |
|
|
80,706,008 |
|
Loss per
share |
|
|
|
|
|
(0.17 |
) |
|
(0.67 |
) |
Loss for the
period available to owners of the Group used in EPS
calculation |
|
|
|
|
|
(13,463 |
) |
|
(53,995 |
) |
Less: |
|
|
|
|
|
|
|
|
|
|
Non-cash loss on
derivatives |
|
|
|
|
|
21,103 |
|
|
70,049 |
|
Write-off of
unamortized loan/bond fees |
|
|
|
|
|
988 |
|
|
316 |
|
Foreign exchange
losses/(gains), net |
|
|
|
|
|
150 |
|
|
(632 |
) |
Unrealized
foreign exchange gains, net on cash and bonds |
|
|
|
|
|
— |
|
|
(3,951 |
) |
Restructuring
costs |
|
|
|
|
|
— |
|
|
445 |
|
Adjusted profit
attributable to owners of the Group |
|
|
|
|
|
8,778 |
|
|
12,232 |
|
Weighted average
number of shares outstanding, basic |
|
|
|
|
|
80,825,637 |
|
|
80,706,008 |
|
Adjusted
earnings per share |
|
|
|
|
|
0.11 |
|
|
0.15 |
|
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