Box Ships Inc. Reports Financial Results For The Second Quarter And Six Months Ended June 30, 2015

Aug 17, 2015, 16:01 ET from Box Ships Inc.

ATHENS, Greece, Aug. 17, 2015 /PRNewswire/ -- Box Ships Inc. (NYSE: TEU) (the "Company"), a global shipping company specializing in the seaborne transportation of containers, announced today its results for the second quarter and six months ended June 30, 2015.

Three Months Ended June 30,

Six Months Ended June 30,

Financial Highlights (Expressed in thousands of U.S. Dollars, except per share data)

2014

2015

2014

2015

Time charter revenues

$12,878

$11,600

$27,381

$23,169

Amortization of above/below market time charters

1,501

966

2,442

2,249

Time charter revenues, adjusted1

$14,379

$12,566

$29,823

$25,418

Net Income / (Loss)

$675

($1,385)

($844)

($1,669)

Adjusted Net Income2

$2,334

$0

$2,636

$1,542

EBITDA2

$6,228

$3,761

$10,350

$8,639

Adjusted EBITDA2

$7,887

$5,146

$13,830

$11,850

Earnings / (Loss) per common share (EPS), basic and diluted

$0.01

($0.06)

($0.07)

($0.09)

Adjusted Earnings / (Loss) per common share, basic and diluted2

$0.06

($0.02)

$0.06

$0.02

1

Time charter revenues, adjusted, is not a recognized measurement under generally accepted accounting principles in the United States of America ("U.S. GAAP" or "GAAP"). We believe that the presentation of Time charter revenues, adjusted is useful to investors because it presents the charter revenues recognized in the relevant period based on the contracted charter rates, excluding the amortization of above/below market time charters attached to vessels acquired. Please refer to the definition and reconciliation of this measurement to the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP at the back of this release.

2

EBITDA, Adjusted EBITDA, Adjusted Net Income / (Loss) and Adjusted Earnings / (Loss) per common share ("Adjusted EPS") are not recognized measurements under GAAP. Please refer to the definitions and reconciliation of these measurements to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP at the back of this release.

Mr. Michael Bodouroglou, Chairman, President, Chief Executive Officer and Interim Chief Financial Officer of Box Ships Inc., commented:

"During the second quarter of 2015, we reported net loss of $1.4 million mainly due to the dry-dockings of Box Hong Kong and Box China. Although these dry-dockings were due later in 2015, we decided to undergo the dry-dockings immediately after the redelivery of the vessels from their previous charter, which has enabled us to successfully re-charter the vessels to MSC for a period of twelve to sixteen months uninterruptedly.

In addition, as previously announced, in June 2015 we extended the loan facility that is secured by the vessels Box Hong Kong and Box China, which reduces the vessels' break-even levels and demonstrates the support of our lenders.

Finally, we fixed the Box Trader at a gross daily rate of $12,400 on a short-term period and extended the CMA CGM Kingfish for a period of five to eight months at a gross daily rate of $15,500, increased by 46% and 63%, respectively, compared to their previous charters, which illustrates the continued market improvement."

Results of Operations

Three months ended June 30, 2015 compared to three months ended June 30, 2014

During the second quarter of 2015, we operated an average of 9 vessels. Our Net Loss during the second quarter of 2015 was $1.4 million, whereas our Adjusted Net Income during the quarter was nil, resulting in basic and diluted loss per share of $0.06 and basic and diluted adjusted loss per share of $0.02. EBITDA and Adjusted EBITDA for the second quarter of 2015 were $3.8 million and $5.1 million, respectively.

During the second quarter of 2014, we operated an average of 9 vessels. Our Net Income and Adjusted Net Income during the second quarter of 2014 was $0.7 million and $2.3 million, respectively, resulting in basic and diluted earnings per share of $0.01 and basic and diluted adjusted earnings per share of $0.06. EBITDA and Adjusted EBITDA for the second quarter of 2014 was $6.2 million and $7.9 million, respectively.

Net revenues

Net revenues represent charter hire earned, net of commissions. During the second quarter of 2015 and 2014, our vessels operated a total of 740 and 819 days, respectively, out of a total of 819 calendar days in both periods. During the second quarter of 2015, we had a total of 20 unscheduled off-hire days, mainly related to 19 idle days of Box Queen, and 59 scheduled off-hire days related to the dry-dockings of Box Hong Kong and Box China. Currently, all vessels in our fleet are employed under fixed rate time charters, having an average weighted remaining charter duration of 6 months (weighted by aggregate contracted charter hire). The Company reported net revenues for the second quarter of 2015 of $11.2 million, a decrease of 10% compared to $12.5 million in the second quarter of 2014. The decrease is mainly due to the re-chartering of Box Emma in March 2015 at a daily rate of $13,500, compared to the daily rate of $28,500 the vessel was earning during the second quarter of 2014, the redelivery of Box Hong Kong and Box China from their charterer on May 26, 2015 and June 6, 2015, respectively, the scheduled off-hire days related to the dry-dockings of Box Hong Kong and Box China and the idle days of Box Queen during the second quarter of 2015. The decrease in revenues resulting from the lower rate and the increase in off-hire days was partially offset by the higher re-chartering rates of other vessels. More specifically, during the second quarter of 2015, the Box Voyager earned a daily rate of $10,600, compared to $7,350 per day that the vessel was earning during the second quarter of 2014; the Box Trader earned a daily rate of $8,500, compared to $8,000 per day that the vessel was earning during the second quarter of 2014; each of the CMA CGM Kingfish and CMA CGM Marlin earned a daily rate of $9,500, compared to $7,000 per day that each of these vessels was earning during the second quarter of 2014; and the Box Queen earned an average daily rate of approximately $13,115, compared to $6,100 per day that the vessel was earning during the second quarter of 2014.

Our net revenues are also net of the amortization of above/below market time charters, which decreased our revenues and net income for the second quarter of 2015 and 2014 by $1.0 million and $1.5 million, respectively, or $0.03 and $0.05 per common share, respectively. Our average time charter equivalent rate, or TCE rate, for the second quarter of 2015 was $14,697 per vessel per day, which was 2% below our average TCE rate of $15,010 per vessel per day during the second quarter of 2014, mainly due to the reasons outlined above. Our adjusted TCE rate was $16,002 per vessel per day in the second quarter of 2015, 5% lower than our adjusted TCE of $16,843 for the second quarter of 2014. TCE rate is not a recognized measurement under GAAP. Please see the table at the back of this release for a reconciliation of TCE rates to time charter revenues, the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.

Voyage expenses

Voyage expenses for the second quarter of 2015 and 2014 amounted to $0.3 million and $0.2 million, respectively. Voyage expenses for the second quarter of 2015 primarily relate to bunkers consumed by the Box Hong Kong and Box China travelling to and from the dry-dockings of $0.2 million and war risk insurance costs of $0.1 million, whereas voyage expenses for the second quarter of 2014 related mainly to war risk insurance costs.  

Vessels operating expenses 

Vessels operating expenses including the amortization of other intangible assets for the second quarter of 2015 and 2014 amounted to $4.0 million and $4.5 million, respectively, or $3.8 million and $4.2 million, respectively, on an adjusted basis to exclude the amortization of other intangible assets. On average, our vessels' operating expenses for the second quarter of 2015 amounted to $4,938 per vessel per day, or $4,683 per vessel per day on an adjusted basis, compared to $5,444 per vessel per day, in the second quarter of 2014, or $5,123 per vessel per day on an adjusted basis. The decrease is a result of continuing cost control efforts. The amortization of other intangible assets for the second quarter of 2015 and 2014 amounted to $0.2 million and $0.3 million, respectively.

Dry-docking expenses

During the second quarter of 2015, two of our vessels, the Box Hong Kong and the Box China, underwent their dry-dockings, which resulted in 59 off-hire days and expenses amounting to $1.3 million. There were no dry-dockings in the second quarter of 2014.

Management fees charged by a related party

Management fees charged by Allseas Marine S.A. (our "Manager" or "Allseas") for the second quarter of 2015 and 2014 were $0.6 million and $0.7 million, or $718 (€648.93) per vessel per day, and $886 (€646.99) per vessel per day, respectively. Management fees charged by a related party represent fees for management and technical services in accordance with our management agreements and are adjusted annually in accordance with the official Eurozone inflation rate. This fee is charged on a daily basis per vessel and is affected by the number of vessels in our fleet, the number of calendar days during the period, the official Eurozone inflation rate and the U.S. Dollar/Euro exchange rate at the beginning of each month.

Depreciation

Depreciation for our fleet for each of the second quarters of 2015 and 2014 was $3.8 million.

General and administrative expenses

General and administrative ("G&A") expenses for the second quarter of 2015 and 2014 amounted to $1.1 million and $1.5 million, or $1,353 and $1,870 per vessel per day, respectively. The decrease in G&A expenses is mainly due to the decreased share-based compensation, which amounted to $0.2 million for the second quarter of 2015 compared to $0.5 million in the same period of 2014.

Interest and finance costs

Interest and finance costs amounted to $1.4 million and $1.8 million for the second quarter of 2015 and 2014, respectively. This decrease in interest and finance costs is due to the decrease in our average borrowings outstanding period over period.

UNAUDITED CONSOLIDATED CONDENSED CASH FLOW INFORMATION

(Expressed in thousands of U.S. Dollars)

Six Months Ended June 30,

2014

2015

Net cash from Operating Activities

$

9,284

$

7,332

Net cash used in Financing Activities

(1,884)

(7,412)

Net increase / (decrease) in cash and cash equivalents

$

7,400

$

(80)

Net cash from Operating Activities

Net cash from Operating Activities for the six months ended June 30, 2015 was $7.3 million. Our vessels generated positive cash flows from revenues, net of commissions, of $23.3 million, while we paid $16.0 million for expenses, of which $2.6 million relates to the payment of interest on our bank loans.

Net cash from Operating Activities for the six months ended June 30, 2014 was $9.3 million. Our vessels generated positive cash flows from revenues, net of commissions, of $29.8 million, while we paid $20.5 million for expenses, of which $3.1 million relates to the payment of interest on our bank loans.

Net cash used in Financing Activities

Net cash used in Financing Activities for the six months ended June 30, 2015, was $7.4 million. During the six months ended June 30, 2015, we repaid $6.4 million of our debt and made cash payments to our preferred shareholders of $1.0 million.

Net cash used in Financing Activities for the six months ended June 30, 2014, was $1.9 million. On April 15, 2014, we completed the public offering and concurrent private placement of 5,500,000 Units, each consisting of one common share and one warrant to purchase 0.40 common shares (the "Units") at a public offering price of $2.05 per unit, resulting in net proceeds of $10.6 million in the aggregate, net of underwriting discounts, commissions and other offering costs of $0.7 million in the aggregate. During the six months ended June 30, 2014, we repaid $11.4 million of our debt, paid financing costs of $0.1 million and made cash payments to our preferred shareholders of $1.0 million.

Liquidity:

As of June 30, 2015, our cash and restricted cash (current and non-current) amounted to $14.5 million in aggregate, of which $8.0 million is considered restricted for minimum liquidity purposes under our loan agreements. As of June 30, 2015, we had total outstanding indebtedness of $128.6 million, of which $12.1 million is scheduled to be repaid in the forthcoming 12-month period, of which $3.2 million has been repaid as of the date of this release. Furthermore, as of June 30, 2015, we were in compliance with the covenants contained in our loan agreements, as amended to give effect to waivers that we were granted during 2014 and 2015. As of June 30, 2015, had the waivers not been granted, we would not have been in compliance with certain of our financial covenants and security cover ratios contained in the loan agreements. The waivers are due to expire on June 29, 2016, and in accordance with U.S. GAAP, unless the waivers are extended for a period of more than one year after the balance sheet date or the loans are refinanced prior to the issuance of the consolidated financial statements, our total debt will be required to be presented as current even though we were in compliance as of June 30, 2015.

Finally, we have no borrowing capacity under our existing loan facilities and no capital commitments. We anticipate that our current financial resources, together with cash generated from operations, will be sufficient to fund the operations of our current fleet, including our working capital requirements, for the next 12 months, assuming that the debt will not be accelerated by our lenders.

Preferred Stock Payments:

On July 1, 2015, we made a cash payment of $0.5 million with respect to our Series C Preferred Shares, for the period from April 1, 2015 through June 30, 2015. As of June 30, 2015, 916,333 Series C Preferred Shares were outstanding.

Cash payments on our Series C Preferred Shares accrue cumulatively at a rate of 9.00% per annum per $25.00 stated liquidation preference per Series C Preferred Share and are payable, when, as and if declared by the Board of Directors, on January 1, April 1, July 1 and October 1 of each year. Our ability to make cash payments will be subject, among other things, to the restrictions in our loan agreements, the provisions of Marshall Islands law and other factors to be considered by our Board of Directors.

Chartering Update and Strategy:

In July 2015, the Box Trader entered into a time charter with Zim Integrated Shipping Services Ltd. ("ZIM") for a period of 50 to 115 days, which commenced on August 3, 2015, at a daily gross charter rate of $12,400.

In July 2015, the CMA CGM Kingfish extended its time charter with CMA CGM for a further period until January 2016 to April 2016, which commenced on August 15, 2015, at a daily gross charter rate of $15,500.

Pursuant to our chartering strategy, we focus on short- to medium-term time charters with staggered maturities, which provide us with the benefit of stable cash flows from a diversified portfolio of charterers, while preserving the flexibility to capitalize on potentially rising rates when the current time charters expire. We may also, under certain circumstances, opportunistically employ our vessels on the spot market. Based on the earliest redelivery dates, the Company has secured under time charter contracts 76% and 18% of its fleet capacity for the remainder of 2015 and 2016, respectively. For future updates on the employment of our vessels, please visit the employment section of our website at www.box-ships.com/fleet-employment.php. The information contained on the Company's website does not constitute part of this press release.   

Fleet List:

The following table provides additional information about our fleet as of August 17, 2015:

Vessel

Year Built

TEU

Charterer

Daily Gross Charter Rate (1)

Charter Expiration (2)

Notes

Box Voyager

2010

3,426

CNC

$10,600

March 2016

3, 11

Box Trader

2010

3,426

ZIM

$12,400

September 2015

4

CMA CGM Kingfish

2007

5,095

CMA CGM

$15,500

January 2016

5

CMA CGM Marlin

2007

5,095

CMA CGM

$9,500

September 2015

6

Box Queen 

2006

4,546

CMA CGM

$13,300

October 2015

7

Maule

2010

6,589

Hapag Lloyd

$38,000

April 2016

8, 11

Box Emma

2004

5,060

CMA CGM

$13,500

February 2016

9, 11

Box Hong Kong

1995

5,344

MSC

$13,000

June 2016

10

Box China

1996

5,344

MSC

$13,000

July 2016

10

Total

43,925

Notes:

1)

Daily gross charter rates do not reflect commissions payable by us to third party chartering brokers and Seacommercial, totaling 6.5% for Box Trader, 5% for Box Hong Kong and Box China, 4.75% for Box Voyager, CMA CGM Kingfish, CMA CGM Marlin, Box Emma and Box Queen, and 2.50% for Maule, including, in each case, 1.25% to Seacommercial.

2)

Based on the earliest redelivery date.

3)

The employment was extended for a period of twelve months and commenced on March 31, 2015.

4)

The employment is for a period of 50 to 115 days and commenced in August 2015.

5)

The employment was extended for a period of five to eight months and commenced on August 15, 2015. The daily gross charter rate shall be $1 until August 20, 2015 and will be increased to $15,500 for the remaining period.

6)

The vessel is expected to be redelivered on or about September 21, 2015.

7)

The employment was extended until October 2015 and commenced in June 2015.

8)

Effective April 10, 2015, all rights and obligations under the charter were novated to Hapag Lloyd AG from CSAV. All other terms remain unchanged. The charterer has the option to purchase the vessel upon expiration of the charter, provided that the option is exercised at least six months prior to the expiration of the term of the charter, for a purchase price of $57.0 million, less a 0.5% purchase commission payable to parties unaffiliated to us.

9)

The employment is for a period of twelve months and commenced in March 2015.

10)

The employment is for a period of twelve to sixteen months and commenced end of June 2015 / beginning of July 2015.

11)

The charterer has the option to increase or decrease the term of the charter by 30 days.

Conference Call and Webcast details:

The Company's management will host a conference call to discuss its results for the second quarter of 2015, on August 18, 2015 at 9:00 am ET.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: +1-888-348-2672 (USA) or +1-412-902-4232 (international).

A replay of the conference call will be available for seven days and can be accessed by dialing +1-877-870-5176 (domestic) and +1-858-384-5517 (international) and using passcode 10070833.

There will also be a simultaneous live webcast over the Internet, through the Company's website (www.box-ships.com). Participants in the live webcast should register on the website approximately 15 minutes prior to the start of the webcast.

About Box Ships Inc.:

Box Ships Inc. is an Athens, Greece-based international shipping company specializing in the transportation of containers. The Company's current fleet consists of nine containerships with a total carrying capacity of 43,925 TEU and a TEU weighted average age of 10.6 years. The Company's common shares and Series C Preferred Shares trade on the New York Stock Exchange under the symbols "TEU" and "TEUPRC", respectively.

Cautionary Statement Regarding Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words "believe," "anticipate," "intends," "estimate," "forecast," "project," "plan," "potential," "may," "should," "expect," "pending" and similar expressions identify forward-looking statements.

The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe 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, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

In addition to these important factors, other 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 world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for container shipping capacity, changes in our operating expenses, including bunker prices, dry-docking and insurance costs, the market for our vessels, availability of financing and refinancing, charter counterparty performance, ability to obtain financing and comply with covenants in such financing arrangements, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, vessels breakdowns and instances of off-hires and other factors. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties.

Contacts:

Box Ships Inc. Tel. +30 (210) 8914600 E-mail: ir@box-ships.com

Investor Relations / Media Allen & Caron Inc. Michael Mason (Investors) Tel. +1 (212) 691-8087 E-mail: michaelm@allencaron.com

Len Hall (Media) Tel. +1 (949) 474-4300 E-mail: len@allencaron.com

- Tables Follow –

SUMMARY FLEET INFORMATION

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

FLEET DATA

Average number of vessels (1)

9.00

9.00

9.00

9.00

Calendar days for fleet (2)

819

819

1,629

1,629

Less:

Scheduled off-hire

-

59

42

59

Unscheduled off-hire

-

20

15

53

Operating days for fleet (3)

819

740

1,572

1,517

Fleet utilization (4)

100.0%

90.4%

96.5%

93.1%

AVERAGE DAILY RESULTS (Expressed in United States Dollars)

Time charter equivalent (5)

$15,010

$14,697

$16,530

$14,193

Vessel operating expenses (6)

$5,444

$4,938

$5,754

$4,988

Management fees charged by a related party (7)

$886

$718

$884

$731

General and administrative expenses (8)

$1,870

$1,353

$1,932

$1,359

Total vessel operating expenses (9)

$8,200

$7,009

$8,570

$7,078

(1)

Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of calendar days each vessel was a part of our fleet during the period divided by the number of calendar days in the period.

(2)

Calendar days are the total days we possessed the vessels in our fleet for the relevant period.

(3)

Operating days for the fleet are the total calendar days the vessels were in our possession for the relevant period after subtracting off-hire days for scheduled dry-dockings or special or intermediate surveys and unscheduled off-hire days associated with repairs and other operational matters. Any idle days relating to the days a vessel remains unemployed are included in unscheduled off-hire days.

(4)

Fleet utilization is the percentage of time that our vessels were able to generate revenues and is determined by dividing operating days by fleet calendar days for the relevant period.

(5)

Time charter equivalent ("TCE"), is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE is determined by dividing time charter revenues, net of commissions and voyage expenses by operating days for the relevant time period. Voyage expenses primarily consist of extra war risk insurance, port, canal, fuel costs and other crew costs reimbursable by the charterers that are unique to a particular voyage and bunkers consumed during the periods that vessels are in between employment. TCE is a non-GAAP standard shipping industry performance measure used primarily to compare daily earnings generated by vessels despite changes in the mix of charter types (i.e., spot voyage charters, time charters and bareboat charters) under which the vessels may be employed between the periods.            

(6)

Daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, other than extra war risk insurance, maintenance, repairs and amortization of intangibles, is calculated by dividing vessel operating expenses by fleet calendar days for the relevant time period.

(7)

Daily management fees are calculated by dividing management fees charged by a related party by fleet calendar days for the relevant time period.

(8)

Daily general and administrative expenses are calculated by dividing general and administrative expense by fleet calendar days for the relevant time period.

(9)

 Total vessel operating expenses ("TVOE") are a measurement of our total expenses, excluding dry-docking expenses, associated with operating our vessels. TVOE is the sum of vessel operating expenses, management fees and general and administrative expenses. Daily TVOE is calculated by dividing TVOE by fleet calendar days for the relevant time period.

Reconciliation of U.S. GAAP Financial Information to Non-GAAP measures

Time Charter Equivalent Reconciliation (Expressed in thousands of U.S. Dollars, except days and daily results)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

Time Charter Revenues

$12,878

$11,600

$27,381

$23,169

Commissions

(350)

(377)

(663)

(697)

Voyage Expenses

(234)

(347)

(732)

(941)

Total Revenue, net of voyage expenses

$12,294

$10,876

$25,986

$21,531

Plus: Amortization of above/below market time charters

1,501

966

2,442

2,249

Total Revenue, net of voyage expenses, adjusted

$13,795

$11,842

$28,428

$23,780

Total operating days

819

740

1,572

1,517

Time Charter Equivalent

$15,010

$14,697

$16,530

$14,193

Time Charter Equivalent, adjusted (10)

$16,843

$16,002

$18,084

$15,676

(10)

Time charter equivalent, adjusted ("TCE adjusted"), is a non-GAAP measure and is determined by dividing time charter revenues, net of commissions, voyage expenses and amortization of above/below market time charters attached to the vessels acquired, by operating days for the relevant time period. Voyage expenses primarily consist of extra war risk insurance, port, canal, fuel costs and other crew costs reimbursable by the charterers that are unique to a particular voyage. We believe that the presentation of TCE adjusted is useful to investors because it presents the TCE earned in the relevant period based on the contracted charter rates, excluding the amortization of above/below market time charters attached to the vessels acquired. The Company's definition of TCE adjusted may not be the same as that used by other companies in the shipping or other industries.

Total Vessel Operating Expenses, adjusted (Expressed in thousands of U.S. Dollars)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

Total vessel operating expenses

$6,717

$5,740

$13,961

$11,531

Less: Amortization of other intangible assets

(263)

(209)

(524)

(521)

Less: Share-based compensation

(548)

(171)

(1,167)

(333)

Total vessel operating expenses, adjusted (11)

$5,906

$5,360

$12,270

$10,677

AVERAGE DAILY RESULTS (Expressed in United States Dollars, except days)

Calendar days for fleet

819

819

1,629

1,629

Vessel operating expenses, adjusted (12)

$5,123

$4,683

$5,432

$4,668

Management fees charged by a related party

$886

$718

$884

$731

General and administrative expenses, adjusted (13)

$1,202

$1,144

$1,216

$1,155

Total vessel operating expenses, adjusted (11)

$7,211

$6,545

$7,532

$6,554

(11)

Total vessel operating expenses, adjusted ("TVOE adjusted'), is a non-GAAP measure and is the sum of vessel operating expenses, management fees and general and administrative expenses excluding non-cash items in relation to the amortization of other intangible assets and share-based compensation. Daily TVOE adjusted is calculated by dividing TVOE adjusted by fleet calendar days for the relevant time period. We believe that the presentation of TVOE adjusted and daily TVOE adjusted are useful to investors because they provide additional information on the fleet operational results. The Company's definition of TVOE adjusted and daily TVOE adjusted may not be the same as that used by other companies in the shipping or other industries

(12)

Daily vessel operating expenses, adjusted is calculated by dividing vessel operating expenses excluding non-cash items relating to the amortization of other intangible assets by fleet calendar days for the relevant time period

(13)

Daily general and administrative expenses are calculated by dividing general and administrative expenses excluding non-cash items relating to the share-based compensation by fleet calendar days for the relevant time period

Net Income / (Loss) / Adjusted Net Income / (Loss) (1) (Expressed in thousands of U.S. Dollars)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

Net Income / (Loss)

$675

($1,385)

($844)

($1,669)

Plus: Amortization of intangibles

1,764

1,175

2,966

2,770

Plus: Share-based compensation

548

171

1,167

333

Less / Plus: Unrealized (gain) / loss on derivatives

-

(18)

-

51

Less / Plus: Fair value change of warrants

(653)

57

(653)

57

Adjusted Net Income

$2,334

$0

$2,636

$1,542

EBITDA / Adjusted EBITDA (1)

Net Income / (Loss)

$675

($1,385)

($844)

($1,669)

Plus: Net Interest expense

1,779

1,372

3,688

2,802

Plus: Depreciation

3,774

3,774

7,506

7,506

EBITDA

$6,228

$3,761

$10,350

$8,639

Plus: Amortization of intangibles

1,764

1,175

2,966

2,770

Plus: Share-based compensation

548

171

1,167

333

Less / Plus: Unrealized (gain) / loss on derivatives

-

(18)

-

51

Less / Plus: Fair value change of warrants

(653)

57

(653)

57

Adjusted EBITDA

$7,887

$5,146

$13,830

$11,850

Earnings / (Loss) per Common Share

(Expressed in thousands of U.S. Dollars, except share and per share data)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

Net Income / (Loss)

$675

($1,385)

($844)

($1,669)

Less: Cash payments to Series C Preferred Shares

(515)

(515)

(1,031)

(1,031)

Less: Net Income / Loss attributable to non-vested share awards 

(3)

37

41

49

Net Income / (Loss) available to common shareholders

$157

($1,863)

($1,834)

($2,651)

Weighted average number of common shares, basic and diluted

29,360,273

30,625,215

27,031,845

30,625,215

Earnings / (Loss) per common share, basic and diluted

$0.01

($0.06)

($0.07)

($0.09)

Adjusted Earnings / (Loss) per Common Share (1) (Expressed in thousands of U.S. Dollars, except share and per share data)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

Adjusted Net Income

$2,334

$0

$2,636

$1,542

Less: Cash payments to Series C Preferred Shares

(515)

(515)

(1,031)

(1,031)

Less: Adjusted Net Income attributable to non-vested share awards 

(36)

10

(35)

(9)

Adjusted Net Income / (Loss) available to common shareholders

$1,783

($505)

$1,570

$502

Weighted average number of common shares, basic and diluted

29,360,273

30,625,215

27,031,845

30,625,215

Adjusted Earnings / (Loss) per common share, basic and diluted

$0.06

($0.02)

$0.06

$0.02

(1)

The Company considers EBITDA to represent net income plus net interest expense and depreciation and amortization. The Company's management uses EBITDA as a performance measure. The Company believes that EBITDA is useful to investors because the shipping industry is capital intensive and may involve significant financing costs. The Company excluded non-cash items in relation to the amortization of intangibles, share-based compensation and unrealized gain / loss on derivatives to derive Adjusted EBITDA because the Company believes it provides additional information on the fleet operational results which may be useful to investors.

The Company excluded non-cash items in relation to the amortization of intangibles, share-based compensation and unrealized gain / loss on derivatives from net income / (loss) to derive to Adjusted Net Income / (Loss) and Adjusted EPS / (Loss) per share. The Company believes that Adjusted Net Income / (Loss) and Adjusted EPS / (Loss) per share provide additional information on the fleet operational results which may be useful to investors.

EBITDA, Adjusted EBITDA, Adjusted Net Income / (Loss) and Adjusted EPS / (Loss) per share are items not recognized by U.S. GAAP and should not be considered as an alternative to net income / (loss), operating income / (loss), earnings / (loss) per share or any other indicator of a Company's operating performance required by U.S. GAAP. The Company's definition of EBITDA, Adjusted EBITDA, Adjusted Net Income / (Loss) and Adjusted EPS / (Loss) per share may not be the same as that used by other companies in the shipping or other industries.

 

BOX SHIPS INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS)

(Expressed in thousands of U.S. Dollars, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

2014

2015

2014

2015

REVENUES:

Time charter revenues (1)

$

12,878

$

11,600

$

27,381

$

23,169

Commissions

(350)

(377)

(663)

(697)

Net Revenues

12,528

11,223

26,718

22,472

EXPENSES:

Voyage expenses

234

347

732

941

Vessels operating expenses (2)

4,459

4,044

9,373

8,126

Dry-docking expenses

-

1,334

2,314

1,334

Management fees charged by a related party

726

588

1,440

1,191

Depreciation

3,774

3,774

7,506

7,506

General and administrative expenses (3)

1,532

1,108

3,148

2,214

Total Expenses

10,725

11,195

24,513

21,312

Operating income

1,803

28

2,205

1,160

OTHER INCOME / (EXPENSES):

Interest and finance costs

(1,779)

(1,372)

(3,688)

(2,802)

Gain / (loss) on derivatives

-

18

-

(51)

Fair value change of warrants

653

(57)

653

(57)

Foreign currency (loss) / gain, net

(2)

(2)

(14)

81

Total other expenses, net

(1,128)

(1,413)

(3,049)

(2,829)

NET INCOME / (LOSS)

$

675

$

(1,385)

$

(844)

$

(1,669)

Other Comprehensive Income / (Loss)

(Loss) / gain on cash flow hedges

(103)

8

(48)

(48)

Total Other Comprehensive Income / (Loss)

(103)

8

(48)

(48)

COMPREHENSIVE INCOME / (LOSS)

$

572

$

(1,377)

$

(892)

$

(1,717)

Earnings / (loss) per common share, basic and diluted

$

0.01

$

(0.06)

$

(0.07)

$

(0.09)

Footnotes:

(1)

includes amortization of below and above market acquired time charters of $1,501 and $966 for the three months ended June 30, 2014 and 2015, respectively, and $2,442 and $2,249 for the six months ended June 30, 2014 and 2015, respectively 

(2)

includes amortization of other intangible assets of $263 and $209 for the three months ended June 30, 2014 and 2015, respectively, and $524 and $521 for the six months ended June 30, 2014 and 2015, respectively

(3)

includes share-based compensation of $548 and $171 for the three months ended June 30, 2014 and 2015, respectively, and $1,167 and $333 for the six months ended June 30, 2014 and 2015, respectively

 

BOX SHIPS INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of U.S. Dollars)

December 31, 2014

June 30,

2015

ASSETS

Cash and restricted cash (current and non-current)

$

14,566

$

14,486

Other current assets

7,455

9,240

Vessels and other fixed assets, net and other non-current assets

375,828

365,316

Total Assets

$

397,849

$

389,042

LIABILITIES AND STOCKHOLDERS' EQUITY

Total debt (1)

$

134,950

$

128,600

Total other liabilities

6,219

6,178

Total stockholders' equity

256,680

254,264

Total Liabilities and Stockholders' Equity

$

397,849

$

389,042

Footnotes:

(1)

Refer to Liquidity section, above

 

SOURCE Box Ships Inc.



RELATED LINKS

http://www.box-ships.com