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Baltic Trading Limited Announces Fourth Quarter Financial Results


February 23, 2011
NEW YORK, Feb. 23, 2011 /PRNewswire/ -- Baltic Trading Limited (NYSE: BALT) ("Baltic Trading" or the "Company") today reported its financial results for the three and twelve months ended December 31, 2010.



The following financial review discusses the results for the three and twelve months ended December 31, 2010. Since the Company began operations in October 2009 and took delivery of its first vessel on April 8, 2010, comparable historical data for the three and twelve months ended December 31, 2009 is unavailable.



Fourth Quarter 2010 and Year-to-Date Highlights



•Declared a $0.17 per share dividend payable on or about March 14, 2011 to all shareholders of record as of March 7, 2011 based on Q4 2010 results;





•Recorded net income of $3.7 million, or $0.17 basic and diluted earnings per share for the fourth quarter;





•Amended the Company's $100 million senior secured credit facility to increase the commitment to $150 million;





•Completed the acquisition of the Company's initial fleet; and





•Completed the acquisition of the three Handysize vessels from the Metrostar group of companies.





Financial Review: 2010 Fourth Quarter



The Company recorded net income for the fourth quarter of 2010 of $3.7 million, or $0.17 basic and diluted earnings per share. Comparatively, for the three months ended September 30, 2010 the Company recorded a net income of $2.5 million, or $0.12 basic and diluted net income per share.



EBITDA was $8.4 million for the three months ended December 31, 2010.



John C. Wobensmith, President and Chief Financial Officer, commented, "2010 was an important year for Baltic Trading. We successfully completed the Company's IPO and made significant progress implementing our unique corporate strategy, enabling Baltic Trading to achieve solid results in its inaugural year. Building on the purchase of our six initial vessels, we acted decisively to acquire three Handysize vessels, further enhancing our earnings power and growing our fleet by more than 18% on a tonnage basis."







Baltic Trading Limited's revenues increased to $15.2 million for the three months ended December 31, 2010 compared to $10.4 million for the three months ended September 30, 2010 primarily due to the operation of a larger fleet during the fourth quarter of 2010.



The average daily time charter equivalent, or TCE, rates obtained by the Company's fleet were $18,596 per day for the three months ended December 31, 2010 compared to $18,412 for the three months ended September 30, 2010. The increase was due to the operation of a greater number of Capesize vessels in the fourth quarter of 2010 that achieved higher rates during the same period.



Total operating expenses increased to $10.4 million for the three months ended December 31, 2010 from $7.2 million for the three months ended September 30, 2010 as a result of the increase in the number of vessels under operation in our fleet. Vessel operating expenses were $4.2 million for the three months ended December 31, 2010 compared to $2.7 million for the three months ended September 30, 2010. General, administrative and management fees increased to $2.3 million from $1.8 million during the comparative periods due to the expansion of our fleet. Depreciation and amortization expenses were $3.7 million for the fourth quarter of 2010 compared to $2.5 million for the third quarter of 2010.



Daily vessel operating expenses, or DVOE, were $5,167 for the fourth quarter of 2010 and $4,893 for the previous quarter this year. We believe daily vessel operating expenses are best measured for comparative purposes over a 12month period in order to take into account all of the expenses that each vessel in our fleet will incur over a full year of operation. Based on estimates provided by our technical managers and management's expectations, we expect DVOE for 2011 to be $5,200 per vessel per day on a weighted average basis.



Financial Review: Twelve Months Ended December 31, 2010

Net income was $8.3 million or $0.46 earnings per share basic and fully diluted for the twelve months ended December 31, 2010. Voyage revenues were $32.6 million and EBITDA was $17.7 million for the twelve months ended December 31, 2010. TCE rates obtained by the Company's fleet for the twelve months ended December 31, 2010 were $19,692 per day.







Daily vessel operating expenses for the twelve months ended December 31, 2010 were $5,016.



Liquidity and Capital Resources



Cash Flow


Understanding Stocks
Net cash provided by operating activities for the twelve months ended December 31, 2010 was $19.0 million. Net cash provided by operating activities for the twelve months ended December 31, 2010 was primarily a result of recorded net income of $8.3 million, plus non-cash operating charges relating to depreciation and amortization of $7.4 million related to the operation of our fleet in addition to $2.9 million of amortization of non-vested stock compensation expense.



Net cash used in investing activities was $389.8 million for the twelve months ended December 31, 2010 and was related to the purchase of the nine vessels in our fleet.



Net cash provided by financing activities for the twelve months ended December 31, 2010 was $376.6 million and mainly consisted of $214.5 million of gross proceeds from our initial public offering, Genco Shipping & Trading Limited's capital contribution in the amount of $75.0 million and $101.3 million of proceeds from our credit facility to finance the deposits and final payments for the Metrostar vessels offset by $7.2 million in cash dividends paid, $4.1 million in common stock issuance costs and $2.9 million in payment of deferred financing costs.


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Capital Expenditures


We make capital expenditures from time to time in connection with vessel acquisitions. Our fleet consists of two Capesize, four Supramax, and three Handysize vessels with an aggregate capacity of approximately 672,000 dwt.



In addition to acquisitions that we may undertake in future periods, we will incur additional capital expenditures due to special surveys and drydockings for our fleet. None of our vessels were drydocked in 2010, and we do not currently expect any of our vessels to be drydocked during 2011.