Earnings Conference Call Second Quarter & 6 Months Ended June 30, 2015

Transcription

1 Earnings Conference Call Second Quarter & 6 Months Ended June 30, 2015

2 Forward Looking Statements This presentation contains certain statements that may be deemed to be forward-looking statements within the meaning of the Securities Acts. Forward-looking statements reflect management's current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements, which are other than statements of historic facts. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, managements' examination of historical operating trends, data contained in our records and other data available from third parties. Although Paragon Shipping Inc. believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, Paragon Shipping Inc. can not assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of the world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydockings, changes in our vessel operating expenses, including drydocking, crewing and insurance costs, or actions taken by regulatory authorities, ability of our counterparties to perform these obligations under sales agreements and charter contracts on a timely basis, potential liability from future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists. Risks and uncertainties are further described in reports filed by Paragon Shipping Inc. with the Securities and Exchange Commission. Slide 2

3 Agenda 2Q 2015 & YTD Highlights Company Update Drybulk Industry Overview Investment Summary Slide 3

4 Highlights - 2Q 2015 & YTD Financial Highlights, 2Q 2015: Net Revenue, net of voyage expenses: $7.9 m. vs. $9.7 m. in 2Q Adjusted Net Loss: $ 8.1 m. or $0.32 p.s. vs. a loss of $5.6 m. or $0.23 p.s. in 2Q 2014 Reduced average daily TVOE by 11.1% year-over-year, to $5,746 per vessel per day Recent Developments: In the second quarter of 2015, we sold the shares of Box Ships Inc. and Korea Line Corporation with net proceeds of $3.9 million in the aggregate. Agreed with all of our lenders to defer at least 50% of the scheduled quarterly installments for a period of one year, and to waive or amend the terms with respect to the financial and security cover ratio covenants the earliest by the end of In July 2015, we completed a block sale of four of our vessels based on an aggregate value of $63.2 million. Following such sale, we generated more than $6 million of available cash after the extinguishment of the outstanding indebtedness. Slide 4

5 Financing Update Agreed with our lenders to amend the terms and conditions of our facilities From 1Q 2015 to 2Q 2016: reduced payments from available cash by $9.9 million Waived or amended several financial and security cover ratio covenants Cancelled the available borrowing capacity with respect to our newbuilding program Repayment Profile Comparison (USD Million) (1) Q15 2Q15 3Q15 4Q15 1Q16 2Q16 Before Amendments After Amendments (1) Includes scheduled quarterly repayments originally payable from the Company s available cash. Excludes the facilities relating to the vessels sold in July Slide 5

6 NBs On the Water Chartering Update Name Kind Seas Type Panam ax C harter Type / Rate TC / $5,750 Ex pected Redelivery Sep Q1 Q2 Q3 Q Q1 Q2 Q3 Q4 Sapphire Seas Supram ax TC / $6,250 Sep-1 5 Coral Seas Panam ax TC / $7,000 Sep-1 5 Precious Seas Handysiz e TC / $7,550 Sep-1 5 Priceless Seas Handysiz e TC / $7,150 Oct-1 5 Calm Seas Panam ax TC / $7,110 Oct-1 5 Diam ond Seas Panam ax TC / $9,000 Oct-1 5 Prosperous Seas Handysiz e TC / $8,250 Nov-15 Deep Seas Panam ax TC / $8,000 Dec-1 5 Proud Seas Handysiz e TC / $8,550 Dec-1 5 Pearl Seas Panam ax TC / $7,050 Dec-1 5 Golden Seas Panam ax TC / $7,050 Dec-1 5 Hull No. DY4050 Ultram ax Hull No. DY4052 Ultram ax Hull No. YZJ1144 Kamsarmax Hull No. YZJ1145 Kamsarmax Hull No. YZJ1142 Kamsarmax Fixed Revenue Days ( 1) 883 open days 6,041 open days Minimum Fixed Days Open Days Optional Period (1) Assumes earliest redelivery dates Slide 6

7 Operating Performance 1H15 vs 1H % YOY increase in average number of vessels 1H15 vs 1H % YOY decrease in daily TVOE 2Q Q H H 2015 Fleet Data Average number of vessels Calendar days for fleet 1,274 1,456 2,528 2,896 Available days for fleet 1,256 1,450 2,467 2,878 Operating days for fleet 1,238 1,430 2,436 2,853 Fleet utilization 98.6% 98.6% 98.7% 99.1% Daily Results Daily Results Time Charter Equivalent 7,870 5,494 8,208 5,148 Vessel operating expenses 4,211 4,064 4,236 4,015 Management fees 1, , G&A expenses (ex. non-cash items) 1, , Total Vessel Operating Expenses (TVOE) 6,388 5,781 6,463 5,746 Slide 7

8 Financial Performance Net revenue, net of voyage expenses: $7.9 million in 2Q Q Q H H 2015 F inancial Performance Net Revenue, net of voyage expenses $ 9.7 m $ 7.9 m $ 20.0 m $ 14.7 m EBITDA ($ 2.2 m) ($ 65.5 m) ($ 21.2 m) ($ 67.1 m) Adjusted EBITDA $ 0.9 m ($ 0.6 m) $ 1.2 m ($ 2.1 m) Net Loss ($ 9.7 m) ($ 72.9 m) ($ 35.5 m) ($ 81.8 m) Adjusted Net Loss ($ 5.6 m) ($ 8.1 m) ($ 11.6 m) ($ 16.8 m) Loss Per Share ($0.39) ($2.93) ($1.56) ($3.29) Adjusted Loss Per Share ($0.23) ($0.32) ($0.51) ($0.68) Non - Cash Items (USD 000's) Loss related to assets held for sale - $47,640 - $47,640 Impairment loss - $16,754 $15,695 $16,754 Gain from sale of assets ($403) - ($403) - (Gain) / loss from marketable securities ($12) $134 ($12) $134 Loss on investment in affiliate $3,101 $207 $5,855 $207 Unrealized loss / (gain) on interest rate swaps $108 ($150) ($69) ($210) Share based compensation $246 $255 $1,359 $491 Write off of financing expenses $1,028 - $1,511 - Total $4,068 $64,840 $23,936 $65,016 Slide 8

9 Million Dwt Drybulk Market TC Rates remained weak throughout 2Q 2015 A mild recovery from the all-time lows started within 3Q 2015 As BDI improved in 3Q 2015, scrapping activity dropped from the elevated levels of the previous quarters Average T/C Routes (USD Per Day) BDI, New-Building (NB) orders and Demolition 15,000 10, ,500 2,000 1,500 5, , Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Panamax Supramax Handysize NB Orders Demolition BDI (Right Axis) Source: Clarkson s Research Slide 9

10 Million Dwt Million Dwt Supply Fundamentals Orderbook currently stands at 17.7% of existing fleet Increased Scrapping : 20.5 million dwt, so far this year vs million dwt in full year 2014 Drybulk fleet growth is slowing down and has been less than 1.5% of growth in YTD 2015 Outstanding Orderbook by Vessel Type Global Fleet vs Orderbook m 47 m 22 m Remainder , % 75% 50% 25% 0% Capesize Panamax Supramax Handysize Global Fleet Orderbook Orderbook as a % of Global Fleet Deletions vs Newbuilding Deliveries Deletions / Deliveries: % 37% 34% 66% YTD Deliveries Deletions Net Growth Source: Clarkson s Research 10.7 Slide 10

11 Investment Summary Drybulk Market Demand is expected to maintain its current trend Manageable orderbook and the scrapping of older vessels will keep supply in check Market remains volatile. A mild recovery from the all-time lows started in 3Q 2015 Paragon s Strengths Cost Control: Reduced average daily TVOE by 11.1% year-over-year Financing: Agreed with certain of our lenders to defer a portion of the next quarterly installments and to waive several financial and security cover ratio covenants Chartering: Spot exposure with the intention to enter into medium-term charters to enhance cash flow visibility, when the market improves Slide 11

12 Investor Relations: DresnerAllenCaron Rudy Barrio (Investors) Tel: (212) Company: Paragon Shipping Inc. 15 Karamanli Ave. GR , Voula, Greece Tel: +30 (210)

13 Appendices Slide 13

14 Statement of Operations (US$ 000's) 3 Months Ended 3 Months Ended 6 Months Ended 6 Months Ended Jun. 30, 2014 Jun. 30, 2015 Jun. 30, 2014 Jun. 30, 2015 Revenue Charter revenue $14,666 $9,945 $28,903 $20,630 Commisssions (842) (599) (1,650) (1,250) Net Revenue 13,824 9,346 27,253 19,380 Expenses / (Income) Voyage expenses, net 4,081 1,489 7,259 4,692 Vessel operating expenses 5,365 5,918 10,710 11,628 Dry-docking expenses , Management fees - related party 1,350 1,263 3,554 2,549 Depreciation 4,485 4,984 8,912 9,911 General & administrative expenses 1,669 1,492 3,434 2,956 Loss related to assets held for sale - 47,640-47,640 Impairment loss - 16,754 15,695 16,754 Bad debt provisions 15 (11) Gain from sale of assets (403) - (403) - (Gain) / loss from marketable securities, net (12) 134 (12) 134 Other income - - (40) - Total Operating Expenses 17,266 79,731 51,317 96,631 Operating Loss (3,442) (70,385) (24,064) (77,251) Other Income / (Expenses) Interest and finance costs (2,812) (2,265) (5,022) (4,435) Loss on derivatives, net (310) (43) (336) (199) Interest income Equity in net income / (loss) of affiliate 18 (1) (258) 173 Loss on investment in affiliate (3,101) (207) (5,855) (207) Foreign currency (loss) / gain (10) (6) (14) 78 Total Other Expenses, net (6,210) (2,521) (11,473) (4,587) Net Loss ($9,652) ($72,906) ($35,537) ($81,838) Weighted average number of shares, basic & diluted 24,281,164 24,460,642 22,414,824 24,460,642 Loss per Common Share, basic & diluted ($0.39) ($2.93) ($1.56) ($3.29) Slide 14

15 Balance Sheet & Cash Flow Statement (US$ 000's) December 31, June 30, Cash and restricted cash (current and non-current) 20,920 8,227 Assets held for sale - 62,568 Vessels, net 369, ,395 Advances for vessel under construction 49,972 35,299 Other fixed assets, net Investment in affiliate 2,956 - Other assets 12,800 9,026 TOTAL ASSETS 456, ,310 Liabilities associated with assets held for sale - 58,998 Total long-term debt, net of deferred financing costs 226, ,787 Other liabilities 7,786 8,321 TOTAL LIABILITIES 234, ,106 Total shareholders'equity 222, ,204 TOTAL LIABILITIES & SHAREHOLDERS' EQUITY 456, ,310 6 Months Ended 6 Months Ended Jun. 30, 2014 Jun. 30, 2015 Net cash used in operating activities (341) (2,670) Net cash (used in) / from investing activities (63,927) 11,382 Net cash from / (used in) financing activites 55,169 (11,526) Slide 15