ST. HELIER, Channel Islands, Oct 26, 2010 (BUSINESS WIRE) —
DHT Holdings, Inc. (NYSE:DHT) (“DHT” or the “Company”) today announced:
Highlights
- The Company declared a cash dividend of $0.10 per share for the quarter payable on November 22, 2010 for shareholders of record as of November 11, 2010.
- Revenues of $23.3 million reflect the base hire under the charters which provides 100% charter coverage until 2012, protecting DHT’s revenues during the current weak tanker market.
- Net income for the third quarter was $3.6 million, or $0.07 per share. Adjusted for non-cash interest rate swap related items, net income for the quarter was $3.5 million, or $0.07 per share.
- Vessel expenses for the quarter were $6.8 million.
- G&A for the quarter was $2.1 million including onetime costs related to change of senior management.
- Net interest expense for the third quarter was $3.8 million.
- Cash on hand at quarter-end was $58 million providing DHT with the flexibility to enter into acquisitions.
- Svein Moxnes Harfjeld and Trygve P. Munthe joined DHT as senior management.
Subsequent events
- On October 18, 2010, an interest rate swap of $194 million expired and at current interest rate levels, annual interest expense is expected to decline by about $8 million.
DHT will host a conference call at 8:00 a.m. EDT Wednesday October 27, 2010 to present the results for the quarter. See below for further details.
Third Quarter Results
The Company today reported revenues for the period from July 1 to September 30, 2010, of $23.3 million, compared to revenues of $22.7 million for the prior-year period. Of the $23.3 million of revenues for the quarter, $18.5 million relates to the seven vessels on time charter and $4.8 million relates to the two vessels on bareboat charter. For the quarter there was no profit sharing under the Company’s profit-sharing arrangements.
The Company’s seven vessels on time charter contracts were on-hire 99.75% for the quarter. Following the completion of two interim surveys in the first half of 2010, the next scheduled class surveys are special surveys for one VLCC in the second quarter of 2011 and one VLCC in the third quarter of 2011. In addition, two Aframax vessels are scheduled for interim survey in the fourth quarter of 2011.
DHT’s vessel expenses for the quarter, including insurance costs, were $6.8 million.
Depreciation and amortization expenses, including depreciation of capitalized dry docking costs, were $7.2 million. General and administrative expenses were $2.1 million including costs related to the change of senior management.
Net finance expenses of $3.7 million included a net non-cash gain on interest rate swaps of $0.3 million.
The Company had net income for the quarter of $3.6 million or $0.07 per diluted share, compared to net income of $1.1 million, or $0.02 per diluted share, for the third quarter of 2009. After adjusting for non-cash financial items related to interest rate swaps, net income for the third quarter of 2010 was $3.5 million, or $0.07 per share. Free cash flow from operations was $10.6 million, or $0.22 per share1.
At the end of the third quarter, the Company’s cash balance was $58 million. The Company remains in compliance with its financial covenants.
Svein Moxnes Harfjeld, CEO, stated, “The solid contract coverage of our entire fleet enables the company to both pay a dividend of $0.10 per share as well as continuing to increase the Company’s cash position. The company’s financial position will enable us to take advantage of opportunities for growth”.
EARNINGS CONFERENCE CALL INFORMATION
DHT plans to host a conference call at 8:00 a.m. EDT Wednesday October 27, 2010 to discuss the results for the third quarter. All shareholders and other interested parties are invited to join the conference call, which may be accessed by calling 1 866 602 0258 within the United States and +44 20 7138 0844 for international callers. The passcode is “DHT”. A live webcast of the conference call will be available in the Investor Relations section on DHT’s website at https://www.dhtankers.com.
An audio replay of the conference call will be available through November 10, 2010. To access the replay, dial 1 866 932 5017 within the United States or +1 347 366 9565 for international callers and enter 7902664#. A webcast of the replay will be available in the Investor Relations section on DHT’s website at https://www.dhtankers.com.
1) Free cash flow from operations after contractual debt service represents the sum of net income, amortization of unrealized loss of interest rate swaps, fair value (gain)/loss on derivative financial instrument and depreciation and amortization. Please refer to the table on page 8 for reconciliation between net income and free cash flow from operations after contractual debt service.
Forward Looking Statements
This press release contains assumptions, expectations, projections, intentions and beliefs about future events, in particular regarding daily charter rates, vessel utilization, the future number of newbuilding deliveries, oil prices and seasonal fluctuations in vessel supply and demand. When used in this document, words such as “believe,” “intend,” “anticipate,” “estimate,” “project,” “forecast,” “plan,” “potential,” “will,” “may,” “should” and “expect” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These statements reflect the Company’s current views with respect to future events and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, you should not place undue reliance on these forward-looking statements. These forward-looking statements represent the Company’s estimates and assumptions only as of the date of this press release and are not intended to give any assurance as to future results. For a detailed discussion of the risk factors that might cause future results to differ, please refer to the Company’s Annual Report on Form 20-F, filed with the Securities and Exchange Commission on March 25, 2010.
The Company undertakes no obligation to publicly update or revise any forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise, except as required by law. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur, and the Company’s actual results could differ materially from those anticipated in these forward-looking statements.
| FINANCIAL INFORMATION | ||||||||||||||||||
| SUMMARY CONSOLIDATED INCOME STATEMENT | ||||||||||||||||||
| ($ in thousands except per share amounts) | ||||||||||||||||||
| 3Q 2010 | 3Q 2009 | 9 months | 9 months | |||||||||||||||
| Jul. 1 – Sep. | Jul. 1 – Sep. | Jan. 1 – Sep. | Jan. 1 – Sep. | |||||||||||||||
| 30, 2010 | 30, 2009 | 30, 2010 | 30, 2009 | |||||||||||||||
| Unaudited | Unaudited | Unaudited | Unaudited | |||||||||||||||
| Shipping revenues | $ | 23,304 | $ | 22,678 | $ | 66,801 | $ | 78,694 | ||||||||||
| Operating expenses | ||||||||||||||||||
| Vessel expenses | 6,803 | 7,087 | 22,870 | 22,332 | ||||||||||||||
| Depreciation and amortization | 7,152 | 6,757 | 21,240 | 19,809 | ||||||||||||||
| General and administrative expenses | 2,094 | 961 | 6,290 | 3,070 | ||||||||||||||
| Total operating expenses | 16,049 | 14,805 | 50,400 | 45,211 | ||||||||||||||
| Income from vessel operations | 7,255 | 7,873 | 16,401 | 33,483 | ||||||||||||||
| Interest income | 50 | 54 | 100 | 270 | ||||||||||||||
| Interest expense | (3,821 | ) | (4,281 | ) | (11,574 | ) | (14,119 | ) | ||||||||||
| Fair value gain/(loss) on derivative instruments | 94 | (2,563 | ) | (1,875 | ) | (4,229 | ) | |||||||||||
| Other financial income/(expenses) | – | – | (3,710 | ) | (2,452 | ) | ||||||||||||
| Net income / (loss) for the period | $ | 3,578 | $ | 1,083 | (658 | ) | 12,953 | |||||||||||
| Basic net income per share | 0.07 | 0.02 | (0.01 | ) | 0.28 | |||||||||||||
| Diluted net income per share | 0.07 | 0.02 | (0.01 | ) | 0.28 | |||||||||||||
| Weighted average number of shares (basic) | 48,762,255 | 48,675,897 | 48,727,580 | 45,525,032 | ||||||||||||||
| Weighted average number of shares (diluted) | 48,762,255 | 48,978,776 | 48,727,580 | 45,680,749 | ||||||||||||||
| CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||||||||||||||||
| Profit for the period | $ | 3,578 | $ | 1,083 | (658 | ) | 12,953 | |||||||||||
| Other comprehensive income: | ||||||||||||||||||
| Cash flow hedges | 2,002 | 4,574 | 11,092 | 9,649 | ||||||||||||||
| Total comprehensive income for the period | $ | 5,580 | $ | 5,657 | 10,434 | 22,602 | ||||||||||||
| SUMMARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION | |||||||||
| ($ in thousands) | |||||||||
| Sep. 30, 2010 | Dec. 31, 2009 | ||||||||
| Unaudited | Audited | ||||||||
| ASSETS | |||||||||
| Current assets | |||||||||
| Cash and cash equivalents | $ | 58,043 | $ | 72,664 | |||||
| Voyage receivables from OSG | – | – | |||||||
| Prepaid expenses | 205 | 1,329 | |||||||
| Prepaid technical management fee to OSG | 1,974 | 1,958 | |||||||
| Total current assets | 60,222 | 75,951 | |||||||
| Vessels, net of accumulated depreciation | 419,797 | 441,036 | |||||||
| Other long-term receivables | 1,344 | 984 | |||||||
| Total assets | 481,363 | 517,971 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
| Current liabilities | |||||||||
| Accounts payable and accrued expenses | $ | 5,192 | $ | 6,250 | |||||
| Derivative financial instruments | 5,175 | 11,779 | |||||||
| Deferred shipping revenues | 7,930 | 7,898 | |||||||
| Total current liabilities | 18,297 | 25,927 | |||||||
| Long term liabilities | |||||||||
| Long-term debt | 265,183 | 293,041 | |||||||
| Derivative financial instruments | 4,033 | 6,646 | |||||||
| Other long term-liabilities | 589 | 433 | |||||||
| Total long-term liabilities | 269,805 | 300,120 | |||||||
| Total liabilities | 288,102 | 326,047 | |||||||
| Shareholders’ equity | |||||||||
| Common stock | 487 | 487 | |||||||
| Paid-in additional capital | 240,375 | 239,624 | |||||||
| Retained earnings/(deficit) | (44,330 | ) | (33,824 | ) | |||||
| Accumulated other comprehensive income/(loss) | (3,271 | ) | (14,363 | ) | |||||
| Total stockholders’ equity | 193,261 | 191,924 | |||||||
| Total liabilities and stockholders’ equity | $ | 481,363 | $ | 517,971 | |||||
| SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
| ($ in thousands) | ||||||||||
| 3Q 2010 | 3Q 2010 | 9 months | 9 months | |||||||
| Jul. 1- Sep. | Jul. 1- Sep. | Jan. 1 – Sep. | Jan. 1 – Sep. | |||||||
| 30, 2010 | 30, 2009 | 30, 2010 | 30, 2009 | |||||||
| Unaudited | Unaudited | Unaudited | Unaudited | |||||||
| Cash Flows from Operating Activities: | ||||||||||
| Net income | $3,578 | $1,083 | ($658) | $12,953 | ||||||
| Items Included in net income not effecting cash flow: | ||||||||||
| Depreciation and amortization | 7,197 | 6,804 | 21,380 | 19,951 | ||||||
| Amortization related to interest and swap expense | (94) | 2,563 | 1,875 | 4,229 | ||||||
| Deferred compensation related to options and | ||||||||||
| restricted stock | 404 | 154 | 751 | 599 | ||||||
| Changes in operating assets and liabilities: | ||||||||||
| Receivables | – | 3,688 | – | 8,231 | ||||||
| Prepaid expenses | 43 | 572 | 748 | (1,163) | ||||||
| Accounts payable, accrued expenses and | ||||||||||
| deferred revenue | (2,243) | 599 | (869) | (1,404) | ||||||
| Net cash provided by operating activities | 8,885 | 15,463 | 23,227 | 43,396 | ||||||
| Cash Flows from Investing Activities: | ||||||||||
| Investments in vessels | – | – | – | (1,482) | ||||||
| Decrease/(increase) in vessel acquisition deposits | – | – | – | – | ||||||
| Net cash used in investing activities | – | – | – | (1,482) | ||||||
| Cash flows from Financing Activities | ||||||||||
| Issuance/(buy back) of common stock | – | – | – | 38,400 | ||||||
| Issuance of long-term debt, net of acquisition costs | – | – | – | – | ||||||
| Cash dividends paid | (4,876) | – | (9,848) | (23,949) | ||||||
| Deferred offering costs | – | – | – | – | ||||||
| Repayment of long-term debt | – | – | (28,000) | (50,000) | ||||||
| Net cash provided by / (used in) financing activities | (4,876) | – | (37,848) | (35,549) | ||||||
| Net increase/(decrease) in cash and cash equivalents | 4,009 | 15,463 | (14,621) | 6,365 | ||||||
| Cash and cash equivalents at beginning of period | 54,034 | 49,922 | 72,664 | 59,020 | ||||||
| Cash and cash equivalents at end of period | 58,043 | 65,385 | 58,043 | 65,385 | ||||||
| Interest paid | $3,704 | $4,204 | $11,681 | $14,081 | ||||||
| SUMMARY CONSOLIDATED STATEMENT OF CHANGES | ||||||||||||||||||||||||
| IN SHAREHOLDERS EQUITY | ||||||||||||||||||||||||
| ($ in thousands except shares) | ||||||||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||
| Common Stock | Paid-in | Cash | ||||||||||||||||||||||
| Shares | Amount | Additional | Retained | Flow | Total | |||||||||||||||||||
| Capital | Earnings | Hedges | equity | |||||||||||||||||||||
| Balance at January 1, 2009 | 39,238,807 | $ | 392 | $ | 200,570 | ($26,721 | ) | ($26,418 | ) | $ | 147,823 | |||||||||||||
| Total comprehensive income | 12,953 | 9,649 | 22,602 | |||||||||||||||||||||
| Cash dividends declared and paid | (23,949 | ) | (23,949 | ) | ||||||||||||||||||||
| Issue of common stock | 9,408,481 | 95 | 38,305 | 38,400 | ||||||||||||||||||||
| Compensation related to options and restricted stock | 28,609 | 599 | 599 | |||||||||||||||||||||
| Balance at September 30, 2009 | 48,675,897 | $ | 487 | $ | 239,474 | ($37,717 | ) | ($16,769 | ) | $ | 185,475 | |||||||||||||
| Balance at January 1, 2010 | 48,675,897 | $ | 487 | $ | 239,624 | ($33,824 | ) | ($14,363 | ) | $ | 191,924 | |||||||||||||
| Total comprehensive income | (658 | ) | 11,092 | 10,434 | ||||||||||||||||||||
| Cash dividends declared and paid | (9,848 | ) | (9,848 | ) | ||||||||||||||||||||
| Issue of common stock | – | |||||||||||||||||||||||
| Compensation related to options and restricted stock | 86,358 | 751 | 751 | |||||||||||||||||||||
| Balance at September 30, 2010 | 48,762,255 | $ | 487 | $ | 240,375 | ($44,330 | ) | ($3,271 | ) | $ | 193,261 | |||||||||||||
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED SEPTEMBER 30, 2010
Basis for preparation
The condensed financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board.
Significant accounting policies
The condensed financial statements have been prepared in accordance with historical cost convention, except for the revaluation of certain financial instruments. The accounting policies that have been followed in these condensed financial statements are the same as presented in the 2009 audited financial statements.
Reconciliation between IFRS and U.S. GAAP
Effective January 1, 2009, DHT changed the basis on which it prepares its financial statements from U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) to IFRS. There are no differences in the statements of operations and equity between IFRS and U.S. GAAP.
| Reconciliation of non-IFRS financial measures ($ in thousands except shares and per share amounts) | ||||||||||||||||||
| 3Q 2010 | 3Q 2010 | 9 months | 9 months | |||||||||||||||
| Jul. 1- Sep. | Jul. 1- Sep. | Jan. 1 – Sep. | Jan. 1 – Sep. | |||||||||||||||
| 30, 2010 | 30, 2009 | 30, 2010 | 30, 2009 | |||||||||||||||
| Unaudited | Unaudited | Unaudited | Unaudited | |||||||||||||||
| Net Income | 3,578 | 1,083 | (658 | ) | 12,953 | |||||||||||||
| Amortization of unrealized loss of interest rate swaps | 2,002 | 4,574 | 11,092 | 9,649 | ||||||||||||||
| Fair value (gain)/loss on derivative financial instrument | (2,096 | ) | (2,011 | ) | (9,217 | ) | (5,420 | ) | ||||||||||
| Net Income adjusted for non-cash financial items | 3,484 | 3,646 | 1,217 | 17,182 | ||||||||||||||
| Weighted average number of shares (diluted) | 48,762,255 | 48,978,776 | 48,727,580 | 45,680,749 | ||||||||||||||
| Net Income adjusted for non-cash financial items | ||||||||||||||||||
| per share | 0.07 | 0.07 | 0.02 | 0.38 | ||||||||||||||
| Net income | $ | 3,578 | $ | 1,083 | (658 | ) | 12,953 | |||||||||||
| Amortization of unrealized loss of interest rate swaps | 2,002 | 4,574 | 11,092 | 9,649 | ||||||||||||||
| Fair value (gain)/loss on derivative financial instruments | (2,096 | ) | (2,011 | ) | (9,217 | ) | (5,420 | ) | ||||||||||
| Depreciation and amortization | 7,152 | 6,757 | 21,240 | 19,809 | ||||||||||||||
| Free cash flow from operations after contractual | ||||||||||||||||||
| debt service | $ | 10,636 | $ | 10,403 | $ | 22,457 | $ | 36,991 | ||||||||||
| Free cash flow from operations after contractual | ||||||||||||||||||
| debt service per share | 0.22 | 0.21 | 0.46 | 0.81 | ||||||||||||||
SOURCE: DHT Holdings, Inc.
DHT Holdings, Inc.
Eirik Ubøe, +44 1534 639 759 and +47 412 92 712
eu@dhtankers.com