Pioneer Marine Inc. and its subsidiaries (OSLO-OTC:PNRM) (Pioneer Marine) a leading shipowner and global drybulk handysize transportation service provider announced its financial and operating results for the quarter ended March 31, 2018.
- Net Income - $1.3 Million
- Net income of $1.3 million or $0.04 per share for Q1 2018, increased by $6.2 million compared to a loss of $4.9 million for Q1 2017.
- Time Charter Equivalent (TCE) revenue - $12.8 Million
- $12.8 million for Q1 2018, increased by $2.8 million or 28% compared to $10 million for Q1 2017; Similarly, TCE per day was increased by 29% to $8,994 per day for Q1 2018 as compared to $6,997 per day for Q1 2017.
- Adjusted EBITDA* - $4.6 Million
- $4.6 million positive Adjusted EBITDA for Q1 2018, increased by $3.4 million compared to $1.2 million for Q1 2017.
- On April 4th, 2018, Pioneer Marine entered into an agreement with clients of Interorient Navigation Company Limited of Cyprus, to acquire three 37,000 dwt Korean bulk carriers built at Hyundai Mipo Dockyard Co. Ltd. (years built 2011, 2012 and 2013 respectively) at attractive price levels, with anticipated delivery dates within June 2018. Pioneer has secured bank financing for these three vessels, subject to completion of documentation.
- On April 18th, 2018 Pioneer Marine and BaltNav A/S (“BaltNav”) mutually agreed to cease their cooperation on an amicable basis. The commercial management of the eight (8) vessels performed by BaltNav will be undertaken gradually by the Company and is expected to be completed by June 2018.
- Within April 2018, the Company purchased for treasury 637,122 of its ordinary shares at a discount compared to Net Asset Value (“NAV”).
Liquidity & Capital Resources:
As of March 31, 2018, the Company had a total liquidity of $76 million inclusive of $14.4 million in restricted cash. The Company has no capital commitments as of March 31, 2018.
*For reconciliation and definition of Adjusted EBITDA refer to “Summary of Operating Data (unaudited)” section within this press release.
Torben Janholt, Chief Executive Officer commented: “Pioneer concluded a successful 2018 first quarter, with a positive Adjusted EBITDA of $4.6 million and a Net Profit of $1.3 million. The implementation of cost reduction measures that were undertaken by the new Executive Management Team, after the restructuring, as well as the improved drybulk market are the key reasons that led Pioneer to these positive results.
“The average BHSI stood at $8,480 per day for the first quarter of 2018 as compared to $6,599 per day for the same prior year period, reflecting a 29% increase. Considering that the first quarter is often the weakest quarter of the year due to seasonal factors such as the Chinese New Year, there is optimism going forward. There is still an acceptable balance between supply and demand in the market, however looming trade wars could influence the market going forward in a negative way.
“Company’s Executive Management along with the support of a young, efficient and committed team is continuously exploring and taking advantage of market opportunities aiming to further reduce costs, increase revenues and maximise efficiencies. We are pleased for the successful deals in line with our strategy for fleet expansion and optimization.
“Looking forward, we have a strong balance sheet and we aim to further take advantage of the positive momentum to maximize our shareholders wealth.”
Financial Review: Three months ended March 31, 2018
Time Charter Equivalent ("TCE") revenue amounted to $12.8 million in the first quarter of 2018 compared to $10 million for the first quarter of 2017. TCE per day for the first quarter of 2018 increased by 29% to $8,994 per day as compared to $6,997 per day for the first quarter of 2017. The increase of the TCE revenue is attributable to the improved market rates and the more efficient operation of the chartering department.
The Company continues to keep vessels operating expenses (“OPEX”) under control at $7.2 million or $4,992 per day for the first quarter of 2018 reduced by 5% as compared to $7.6 million or $4,997 per day for the first quarter of 2017.
During first quarter of 2018 no vessels were drydocked and the amount of approximately $0.1 million relates to initial expenses for the upcoming Drydocks of Eden Bay and Paradise Bay. During the corresponding period of 2017 five vessels completed their special surveys and drydock expense amount to $2.6 million.
Depreciation expense for the first quarter of 2018 decreased to $2 million from $2.1 million in the first quarter of 2017. The decrease of $0.1 million in depreciation expense is due to the decreased number of fleet vessels during first quarter of 2018.
General and administration expenses for the first quarter of 2018 decreased to $0.9 million or $605 per day, which is significantly reduced by 18% as compared to same quarter in 2017. The decrease in G&A expenses per day is attributed to the successful restructuring of the Company which took place during second quarter of 2017 and the overall better control the Company has over General and Administrative Expenses due to the centralization of company’s key departments in Greece.
Interest expense and finance cost for the first quarter of 2018 amounted to $1.4 million, reduced by $0.1 million as compared to the first quarter of 2017. The slight reduction is due to the decreased indebtedness despite the increased floating rates as compared to same period in previous year.
Interest Income for the first quarter of 2018 amounted to $0.2 million, increased by $0.1 million as compared to the first quarter of 2017. The increase is attributable to the improved market rates compared to first quarter of 2017 as well as the continuous monitoring of treasury management opportunities available in the market.
Source: Pioneer Marine