Eagle Bulk Offloads Bulker Trio as It Sinks Further into Red in Q1
- Business & Finance
Financially-troubled owner and operator of Supramax dry bulk vessels Eagle Bulk Shipping has sold the vessel Peregrine and entered into an agreement to sell two additional vessels, MV Harrier and MV Falcon.
The sale of the three vessels will bring in a total of USD 9.2 million after brokerage commissions, the company said.
The announcement was made as Eagle Bulk reported a net loss of USD 39.3 million for the first quarter of 2016, compared to a net loss of USD 20.7 million for the comparable quarter in 2015. The company’s adjusted net loss was USD 27.5 million, which excludes one-time refinancing expenses of USD 5.6 million and non-cash vessel impairment of USD 6.2 million.
Net revenues of USD 21.3 million saw a dip compared to USD 26.3 million year-on-year, which was due the lower time charter hire rates in the first quarter of 2016, the company said.
“In a quarter which saw dry bulk indices hit all-time lows in February – coupled with the uncertainty and negative business impact of a protracted forbearance with certain of our lenders – Eagle Bulk acted decisively to significantly enhance our liquidity position and improve our long-term financial flexibility through the execution of a comprehensive balance sheet restructuring. In addition, as part of this transaction, we formed a new corporate structure to facilitate the company’s ability to capitalize on market opportunities going forward,” Gary Vogel, Eagle Bulk’s CEO, commented.
“We have also focused on technical enhancements, which includes bringing substantially all vessels under in-house management to help actively pursue operational excellence and cost efficiencies over the long-term.”
Total operating expenses for the quarter were USD 57.7 million, up from USD 43.8 million last year, which was primarily assigned due to the increase in voyage expenses, refinancing expenses and vessel impairment.
During the quarter, the company’s fleet utilization rate was 98.4%.
At the end of March, Eagle Bulk completed a comprehensive balance sheet recapitalization following an agreement with its lenders and holders of the company that provided the company with approximately USD 105 million in incremental liquidity and enhanced financial flexibility.
Eagle Bulk operates a fleet of around 45 mid-size dry bulk ships.