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Ardmore Shipping Corporation Announces Financial Results For Year And Fourth Quarter 2013

Stocks in this article: ASC

Ardmore Shipping Corporation (NYSE:ASC) (“Ardmore” or the “Company”) today announced results for the twelve and three months ended December 31, 2013.

Highlights

    Reported EBITDA (see Non-GAAP Measures section below) of $9.5 million for the twelve months ended December 31, 2013, an increase of $4.4 million from $5.1 million for the twelve months ended December 31, 2012. The Company reported a net loss of $3.8 million for the twelve months ended December 31, 2013, or $0.21 basic and diluted loss per share, as compared to a net loss of $4.5 million, or $0.25 basic and diluted loss per share, for the twelve months ended December 31, 2012. Basic and diluted losses per share are based on 18,050,000 shares, which equates to the common shares outstanding after our IPO.
 
Adjusted EBITDA (see Non-GAAP Measures section below) was $10.8 million for the twelve months ended December 31, 2013, an increase of $5.7 million from $5.1 million for the twelve months ended December 31, 2012. Adjusted net loss (see Non-GAAP Measures section below) was $2.4 million, or $0.13 basic and diluted adjusted loss per share for the twelve months ended December 31, 2013. This compared to an adjusted net loss of $4.5 million, or $0.25 basic and diluted adjusted loss per share for the twelve months ended December 31, 2012. Basic and diluted losses per share are based on 18,050,000 shares, which equates to the common shares outstanding after our IPO.
 

Took delivery of two mid-range (“MR”) product and chemical tankers in January 2014. The first is the Ardmore Seavantage, Ardmore’s third MR product and chemical tanker newbuilding delivered from SPP Shipbuilding Co.,Ltd. in South Korea. The second is the Ardmore Seamariner, a 45,726 Dwt MR product tanker built in October 2006 at Minami Nippon Shipbuilding Co., Ltd., Japan.

 

Committed three vessels to time charters: the Ardmore Seavaliant to a one year time charter at a rate of $17,100 per day, the Ardmore Seamariner to a three-month charter at a rate of $16,050 per day and the Ardmore Centurion to a six to twelve-month charter at a rate of $13,500 per day.

 

Completed Eco-mod upgrades to the Ardmore Seamariner in conjunction with its intermediate survey and completed planned fuel efficiency and commercial upgrades to the Ardmore Centurion.

 
Opened an executive office in Bermuda on February 7, 2014. Our operating office will continue to be located in Ireland through our wholly owned subsidiary, Ardmore Shipping Limited.
 
Announced a cash dividend of $0.10 per share for the quarter ended December 31, 2013 in line with previously stated intentions to pay shareholders quarterly dividends of $0.10 per share, or $0.40 per share per year.
 
Signed a commitment letter for a senior debt facility with ABN AMRO Bank N.V., Nordea Bank Finland Plc and Skandinaviska Enskilda Banken AB (“SEB”) in the amount of $172.0 million to finance eight of the vessels currently on order.
 

Summary of Recent and Fourth Quarter Events

Fleet Operations

On January 7, 2014, Ardmore took delivery of the 2006-built  Ardmore Seamariner, a 45,726 Dwt MR product tanker built at Minami Nippon Shipbuilding Co., Ltd. in Japan, which was acquired by the Company in October 2013. On delivery, the vessel entered drydock, where it was upgraded to Eco-mod in conjunction with its scheduled intermediate survey. On completion of drydock, the vessel commenced employment on a three-month time charter at a rate of $16,050 per day in February 2014.

On January 17, 2014, Ardmore took delivery of its third newbuilding, the  Ardmore Seavantage, a 49,997 Dwt IMO 3 Eco-design MR product and chemical tanker built at SPP Shipbuilding Co., Ltd. in South Korea. Following delivery, the  Ardmore Seavantage commenced employment under an existing charter arrangement with the Vitol Group.

The Ardmore Seavaliant, a 49,998 Dwt Eco-Design IMO 3 MR product and chemical tanker, was committed to a one-year time charter commencing in February 2014 at a rate of $17,100 per day. This rate represents an increase in time charter rates for Eco-design MR tankers of approximately $2,000 per day compared to one year ago.

On January 30, 2014, Ardmore completed upgrades to the Ardmore Centurion. The upgrades further improve fuel efficiency, allow carriage of a broader range of cargos and reduce cleaning time, which will enhance the vessel’s earnings potential. On redelivery, the vessel commenced employment on a six to twelve-month time charter at a rate of $13,500 per day, subject to certain conditions.

With the addition of the Ardmore Seamariner and Ardmore Seavantage, Ardmore’s fleet stands at 10 ships in operation and 11 Eco-design product and chemical tankers on order, with the next newbuilding vessel, the  Ardmore Seavanguard, scheduled to deliver from SPP Shipbuilding Co., Ltd. in mid-February 2014, at which time 52% of our fleet will be in the water and able to generate cashflow.

Financing

On February 3, 2014, Ardmore obtained a commitment letter for a senior debt facility with ABN AMRO Bank N.V., Nordea Bank Finland Plc and Skandinaviska Enskilda Banken AB (“SEB”) in the amount of $172.0 million. The proceeds are expected to be used to finance up to 65% of the purchase price of eight vessels that Ardmore currently has on order. The commitment has a margin at 3.15% above LIBOR and the terms include an accordion option whereby, subject to lenders approval, Ardmore may request to increase the facility to finance the acquisition of additional vessels.

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