Euroseas Reports Loss
Euroseas Ltd has announced its results for the three and six month period ended June 30, 2016 as well as certain fleet updates.
Total net revenues of $7.3 million. Net loss of $19.2 million; net loss attributable to common shareholders (after a $0.4 million of dividend on Series B Preferred Shares) of $19.6 million or $2.42 loss per share basic and diluted.
The results include an impairment charge of $14.0 million on our "Investment in joint venture". Adjusted net loss attributable to common shareholders1 for the period was $0.51 per share basic and diluted.
An average of 11.4 vessels were owned and operated during the second quarter of 2016 earning an average time charter equivalent rate of $7,373 per day.
Recently, the Company announced that it canceled one of its newbuilding contracts with the Dayang shipyard due to excessive delays in the construction of the vessel (Hull DY 160) as specified in the contract.
The Company has demanded the return of its progress payments and other expenses of approximately $8.6 million as specified in the newbuilding contract and secured by refund guaranties. The parties have referred the matter to arbitration.
Also the Company announced that it amended its newbuilding contract with the YSJ yard for the construction of a Kamsarmax vessel to provide the Company with the option until December 31, 2016 to change the type of the vessel to be built, buy another vessel built by the yard transferring any payments made under the newbuilding contract, or cancel the newbuilding contract without additional cost.
Furthermore, the Company announces that it has agreed to purchase M/V Aegean Express, a 1997-built 1,439 teu fully cellular containership for approximately $3 million, to replace M/V Cpt. Costas, a 1992-built containership which was sold during the second quarter of 2016.
Finally, the Company announces that the Company's Board authorized the establishment of an ATM offering of up to 15% of the Company's outstanding shares.
Aristides Pittas, Chairman and CEO of Euroseas commented: "While the charter markets for both sectors we operate remain challenging, we have managed to improve the liquidity of the Company by restructuring or refinancing some of our loans. Our revised loan profile combined with certain developments in our newbuilding contracts have reduced the required capital expenditures and significantly improved the liquidity outlook of Euroseas."
Aristides added:" We are now focused on how to take advantage of the low vessel price environment and find opportunities to expand and renew our fleet, as we have done with the replacement of M/V Cpt. Costas with a five year younger vessel for a marginally higher price.
