DryShips Turns to Black as It Pursues Debt Restructuring

Greece-based owner of drybulk carriers and offshore support vessels DryShips Inc. reported a net income of USD 55.4 million for the first quarter of 2016, against the net loss of USD 59.2 million reached in the same period a year earlier.

The net income includes the company’s vessel impairment charges and loss on sales, which were at USD 40.8 million for the quarter, as well as a net income pick-up from the company’s 40.4% ownership in Ocean Rig of USD 116.5 million.

The company also reported a negative adjusted EBITDA of USD 15.6 million for the first quarter of 2016.

Due to the prolonged market downturn in the drybulk segment and the continued depressed outlook on freight rates, DryShips is currently in discussions with its lenders for the restructuring of its debt facilities.

Three of the company’s bank facilities have matured and DryShips has not made the final balloon installment.

For the remaining bank facilities, DryShips has elected to suspend principal and interest payments to preserve cash liquidity.

As at the end of the first quarter of 2016, the company’s total debt stood at USD 269.5 million.

In April 2016, the company received notice of termination of its contract for the oil spill recovery vessel Vega Inruda from Petroleo Brasileiro S.A. (Petrobras), effective as of April 6.

Furthermore, DryShips sold all of its shares in Ocean Rig for total cash consideration of approximately USD 49.9 million during the same month.

DryShips owns a fleet of 20 Panamax drybulk carriers with a combined deadweight tonnage of approximately 1.5 million tons, and 6 offshore supply vessels, comprising 2 platform supply and 4 oil spill recovery vessels.

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