Takes Delivery of Panamax Drybulk VesselNEW YORK, Nov 20, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Genco Shipping & Trading
Limited (Nasdaq: GSTL) today announced that it has taken delivery of the Genco
Surprise, a 1998-built Panamax vessel. The Company intends to commence a
previously announced time charter for the Genco Surprise for twelve to
fourteen months at a gross rate of $25,000 per day upon delivery of the vessel
to the charterer on or about November 23, 2006.
The Genco Surprise is the final vessel delivered under the Company's
previously announced agreement to acquire three drybulk vessels for an
aggregate purchase price of $81.25 million. With the addition of its most
recent Panamax vessel, Genco's fleet consists of seven Panamax, eight Handymax
and five Handysize vessels with a carrying capacity of approximately 1,029,000
dwt and an average age of nine years.
Robert Gerald Buchanan, President, commented, "We are pleased to complete
our three-vessel acquisition with the delivery of the Genco Surprise. This
acquisition further demonstrates the disciplined approach employed by our
Company in consolidating the drybulk industry. With pro forma liquidity of
$388 million as of September 30, 2006, we will continue to seek opportunities
to expand our fleet in a prudent manner with a focus on earnings and cash flow
accretion as well as return on capital."
The following table reflects the employment of Genco's fleet after giving
effect to the delivery of the Genco Surprise:
Fleet List
Vessel Vessel Type Expiration Date(1) Time Charter Rates(2)
1 Genco
Beauty Panamax February 2007 $29,000
2 Genco
Knight Panamax February 2007 $29,000
3 Genco
Leader Panamax Spot(3) N/A
4 Genco
Trader Panamax Spot(3) N/A
5 Genco
Vigour Panamax December 2006 $29,000
6 Genco
Acheron Panamax January 2007 $28,500
7 Genco 12 to 14 months from
Surprise Panamax charter delivery date $25,000
8 Genco
Muse Handymax September 2007 $26,500 (4)
9 Genco
Marine Handymax March 2007 $18,000 (5)
10 Genco
Prosperity Handymax March 2007 $23,000
11 Genco
Carrier Handymax December 2006 $24,000
12 Genco
Wisdom Handymax January 2007 $24,000
13 Genco
Success Handymax January 2007 $23,850
January 2008 $24,000 (6)
14 Genco
Glory Handymax December 2006 $18,250
15 Genco
Commander Handymax October 2007 $19,750
16 Genco
Explorer Handysize July 2007 $13,500
17 Genco
Pioneer Handysize August 2007 $13,500
18 Genco
Progress Handysize August 2007 $13,500
19 Genco
Reliance Handysize July 2007 $13,500
20 Genco
Sugar Handysize July 2007 $13,500
(1) The dates presented on this table represent the earliest dates that
our charters may be terminated. Except with respect to the Genco
Trader and Genco Leader charters, under the terms of the contracts,
charterers are entitled to extend time charters from two to four
months in order to complete the vessel's final voyage plus any time
the vessel has been off-hire.
(2) Time charter rates presented are the gross daily charterhire rates
before the payments of brokerage commissions ranging from 1.25% to 5%
to third parties. In a time charter, the charterer is responsible for
voyage expenses such as bunkers, port expenses, agents' fees and canal
dues.
(3) The Genco Trader and Genco Leader entered into the Baumarine Pool
arrangement in December 2005 and February 2006, respectively.
(4) Since this vessel was acquired with an existing time charter at an
above market rate, the Company allocates the purchase price between
the vessel and a deferred asset for the value assigned to the above
market charterhire. This deferred asset is amortized as a reduction to
voyage revenues over the remaining term of the charter, resulting in a
daily rate of approximately $21,500 recognized as revenue. For cash
flow purposes, the Company will continue to receive $26,500 per day
less commissions.
(5) The time charter rate was $26,000 until March 2006 and $18,000
thereafter. For purposes of revenue recognition, the charter contract
is reflected on a straight-line basis in accordance with GAAP.
(6) The Company extended the time charter for an additional eleven to
thirteen months at a rate of $24,000 per day, less a 5% third party
brokerage commission. The time charter would commence February 1, 2007
following the expiration of the vessel's current time charter in
January 2007. The extension is subject to completion of definitive
agreements acceptable to both Genco and Korea Line Corporation.
About Genco Shipping & Trading Limited
Genco Shipping & Trading Limited transports iron ore, coal, grain, steel
products and other drybulk cargoes along worldwide shipping routes. Currently,
Genco Shipping & Trading Limited owns a fleet of 20 drybulk vessels,
consisting of seven Panamax, eight Handymax and five Handysize vessels, with a
carrying capacity of approximately 1,029,000 dwt.
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act
of 1995
This press release contains forward-looking statements made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. These forward looking statements are based on management's current
expectations and observations. Included among the factors that, in our view,
could cause actual results to differ materially from the forward looking
statements contained in this report are the following: (i) changes in demand
or rates in the drybulk shipping industry; (ii) changes in the supply of or
demand for drybulk products, generally or in particular regions; (iii) changes
in the supply of drybulk carriers including newbuilding of vessels or lower
than anticipated scrapping of older vessels; (iv) changes in rules and
regulations applicable to the cargo industry, including, without limitation,
legislation adopted by international organizations or by individual countries
and actions taken by regulatory authorities; (v) increases in costs and
expenses including but not limited to: crew wages, insurance, provisions,
repairs, maintenance and general and administrative expenses; (vi) the
adequacy of our insurance arrangements; (vii) changes in general domestic and
international political conditions; (viii) changes in the condition of the
Company's vessels or applicable maintenance or regulatory standards (which may
affect, among other things, our anticipated drydocking or maintenance and
repair costs) and unanticipated drydock expenditures; and other factors listed
from time to time in our public filings with the Securities and Exchange
Commission including, without limitation, our Annual Report on Form 10-K for
the year ended December 31, 2005, our Quarterly Reports on Form 10-Q, and our
reports on Form 8-K. Our ability to pay dividends in any period will depend
upon factors including the limitations under our loan agreements, applicable
provisions of Marshall Islands law and the final determination by the Board of
Directors each quarter after its review of our financial performance. The
timing and amount of dividends, if any, could also be affected by factors
affecting cash flows, results of operations, required capital expenditures, or
reserves. As a result, the amount of dividends actually paid may vary.
The pro forma liquidity figure of $388 million, displayed above, consists
of the undrawn amount of our credit facility of $338 million plus pro forma
cash of $50.3 million which takes into effect the payment of dividends of
$15.3 million on or about November 30, 2006 to all shareholders of record as
of November 16, 2006 as well as the payment for our three new vessels of
$81.25 million.
SOURCE Genco Shipping & Trading Limited
John C. Wobensmith, Chief Financial Officer of Genco Shipping & Trading Limited,
+1-646-443-8555
http://www.gencoshipping.com