MAJURO, Marshall Islands, Feb. 27, 2020 (GLOBE NEWSWIRE) -- Pioneer Marine Inc. and its subsidiaries (OSLO-OTC: PNRM) ("Pioneer Marine," or the "Company") a leading shipowner and global drybulk handysize transportation service provider announced its financial and operating results for the fourth quarter and year ended December 31, 2019.

Financial Highlights at a glance:

		Fourth quarter 2019		Year ended 2019
Net income		$5.8 million		$12.5 million
Time Charter equivalent (“TCE”) revenue		$14.5 million		$53.8 million
EBITDA		$9.3 million		$27.4 million
Adjusted EBITDA*		$6.5 million		$21.6 million

Torben Janholt, Chief Executive Officer commented: “Despite the challenging year for the drybulk industry, Pioneer Marine managed to conclude the most profitable year in its entire history and the second consecutive year with a positive bottom line. Our chartering strategy to cover significant part of the weak first quarter in combination with our consistent above market performance contributed significantly to Company’s results. The decision to dispose older tonnage at attractive selling prices and the efficient cost control throughout the organization paved the way for Pioneer to achieve a Net Profit of $12.5 million and EBITDA of $27.4 million.

“Towards the end of 2019, we distributed a cash dividend of $0.40 per share to our shareholders.  Looking forward, we aim to take advantage of market opportunities in spite of the present depressed shipping scenarios and maximise our shareholders wealth.

“Taking this opportunity, I would like to announce that my journey with Pioneer has come to an end and effective February 28, 2020 I have decided to retire as the Company’s CEO and member of the board. It has been a pleasure to work with such a motivated group of people and I am proud that together we brought Pioneer to a new era. Mr. Dimitrios Papoulis, who currently serves as the Company’s COO will be appointed the new CEO and Mrs. Korinna Tapaktsoglou also serving as CFO, will be appointed as member of the Board of Directors.”

_{*For reconciliation and definition of EBITDA/Adjusted EBITDA refer to “Summary of Operating Data (unaudited)” section within this press release.}

Recent Events:

On February 27, 2020 the Board of Directors of Pioneer Marine declared a cash dividend of $0.30 per share of common stock. The cash dividend will be payable on or around March 12, 2020 to shareholders of record on March 5, 2020. The shares will be traded as ex dividend as of March 4, 2020.

Liquidity & Capital Resources:

As of December 31, 2019, the Company had a total liquidity of $27.4 million inclusive of $11 million in restricted cash. 

The Company’s plan is to proceed with the installation of Ballast Water Treatment System (‘BWTS’) on three vessels of the fleet within 2020 with an anticipated cost of $0.9 million and on the remaining fleet vessels up to early 2023. To date, there are three vessels out of the current fleet which have been already fitted with BWTS.

2019 Events at a glance:

Fleet developments: 

Consistent with the announced strategy to dispose of older tonnage Pioneer Marine has agreed to the following vessels’ disposal during the year ended December 31, 2019:

• On January 23, 2019, the Company entered into a Memorandum of Agreement (“MOA”) for the sale of M/V Paradise Bay to an unrelated third party on a charter free basis. The vessel was delivered to its new owners on April 10, 2019 and the Company recorded a gain on sale of $3.8 million.
   
• On October 24, 2019, the Company entered into a Memorandum of Agreement (“MOA”) for the sale of M/V Fortune Bay to an unrelated third party on a charter free basis. The vessel is expected to be delivered to her new owners latest by early July 2020.
   
• On November 14, 2019, the Company entered into a Memorandum of Agreement (“MOA”) for the sale of M/V Tenacity Bay to an unrelated third party on a charter free basis. The vessel was delivered to her new owners on December 18, 2019 and the Company recorded a gain on sale of $3.0 million.
   
• On December 24, 2019, the Company entered into a Memorandum of Agreement (“MOA”) for the sale of M/V Calm Bay to an unrelated third party on a charter free basis. On January 17, 2020, the sale of M/V Calm Bay was completed, and the vessel was delivered to its new owners.

Other developments

• On July 29, 2019 the Company entered into a commercial management agreement with a third party, to undertake the commercial management of five dry bulk vessels, enhancing in this context its operating platform.
   
• On October 28, 2019, the installation of the Ballast Water Treatment System on the M/V Emerald Bay was completed successfully.  The project was managed by in-house technical personnel and was carried out while the vessel was en-route without disrupting vessel’s operations, enabling cost efficiencies as the installation was completed with a total expenditure of $0.3 million.
   
• On November 20, 2019, the Board of Directors of Pioneer Marine Inc. declared a cash dividend of $0.40 per outstanding share of company’s Common Stock. On December 6, 2019, the dividend amounting to $10,186, was paid to stockholders of record as of November 29, 2019.
   
• Within 2019, the Company repurchased 826,770 of its own shares for a total amount of $2,609 thousand. All shares were acquired at a discounted price per share compared to Company’s Net Asset Value, increasing the treasury shares held by the Company to a total of 4,867,832 shares.

Financial Review:  Year 2019

Net Income for the year ended December 31, 2019 increased by 81% and amounted to $ 12.5 million as compared to 2018 net income of $7 million. This is mainly attributable to the gain on the sale of M/V Paradise Bay and M/V Tenacity Bay of $6.8 million. The company reported an EBITDA of $27.4 million increased by $5.8 million or 27% compared to 2018.

TCE revenue for 2019 amounted to $53.8 million, decreased by 9% compared to previous year results, mainly due to weaker market conditions. TCE per day for the year ended December 31, 2019 amounted to $8,213, decreased by 13% compared to previous year results. Despite the poor conditions, the Company for a fourth consecutive year achieved to outperform the market by 17% and maintain a high utilisation rate of 98.4%.

Cost reducing initiatives and optimisation of cost control procedures developed by the Company achieved a healthy OPEX rate of $4,251 per day, significantly reduced compared to $4,484 per day for 2018.

Efficient cost management throughout Company’s departments contributed towards the reduction of the daily G&A rate to $546 per day, a drop of 17% compared to previous year.

Drydock cost for the year amounted to $1.1 million as two vessels of our fleet performed their special surveys during 2019 while in previous year four vessels of our fleet underwent special surveys for a total cost of $2.4 million.

Interest and finance cost amounts to $5.6 million, a decrease of 8% compared to prior year results mainly due to slightly reduced average Libor rates prevailing as well as reduced loan balances.  

Financial Review:  Fourth Quarter 2019

The fourth quarter of 2019 contributed a positive amount of $5.8 million to Company’s annual results, marking a 11% increase compared to the fourth quarter of 2018.

EBITDA totalled to $9.3 million increased by $0.2 million or 2% compared to prior year period.

TCE rate of $9,060 slightly lower by 10% compared to $10,085 TCE per day for the same period of 2018 depicting the poor market conditions prevailing during the last quarter of 2019, however the achieved TCE rate consistently remain well above market by 13%.

Daily vessel OPEX are slightly increased to $4,161 per day during this quarter, as compared to $4,040 for the same period during 2018, the increase is mainly attributable to expenses incurred in preparation of vessels disposal within this quarter.

Daily G&A rate remained at the same levels both in fourth quarter of 2019 and 2018 as a result of our continuous efforts to keep this cost centre at competitive levels compared to our peers.

Interest and finance cost of $1.2 million was decreased by 20% compared to prior year same period, mainly due to the reduced Libor rates combined with reduced loan balances. 

Cash Flow Review:  Year ended December 31, 2019

Cash and cash equivalent, including restricted cash increased by $0.5 million as at December 31, 2019 and amounted to $27.3 million as compared to $26.8 million as at December 31, 2018.

The increase is attributable to cash provided by operating activities of $17.2 million and cash provided by investing activities of $17.6 million partially offset by cash used in financing activities of $34.2 million.

Cash flow activities highlights during the year include:

• $18.2 million cash inflow from vessels disposal completed within the year;
• $21.2 million repayments and prepayments due to vessels sale of loans;
• $2.6 million paid for repurchase of common stock, and
• $10.2 million dividend distribution to Company’s shareholders

Fleet List

Owned Fleet

Vessel	Yard			DWT	Year Built
Handysize
Calm Bay	Saiki Heavy Industries			37,534	2006
Reunion Bay	Kanda Shipbuilding			32,354	2006
Fortune Bay	Shin Kochijyuko			28,671	2006
Ha Long Bay	Kanda Kawajiri			32,311	2007
Teal Bay	Kanda Kawajiri			32,327	2007
Eden Bay	Shimanami Shipyard			28,342	2008
Emerald Bay	Kanda Shipbuilding			32,258	2008
Mykonos Bay	Jinse Shipbuilding			32,411	2009
Resolute Bay	Hyundai Vinashin			36,767	2012
Jupiter Bay	Tsuji Heavy Industries			30,153	2012
Venus Bay	Tsuji Heavy Industries			30,003	2012
Orion Bay	Tsuji Heavy Industries			30,009	2012
Falcon Bay	Yangzhou Guoyu Shipbuilding			38,464	2015
Kite Bay	Yangzhou Guoyu Shipbuilding			38,419	2016
Alsea Bay	Hyundai Mipo Dockyard Co. Ltd			36,892	2011
Liberty Bay	Hyundai Mipo Dockyard Co. Ltd			36,892	2012
Monterey Bay	Hyundai Mipo Dockyard Co. Ltd			36,887	2013

Commercially Managed Fleet*

Handysize
Handy 1	Samjin Shipbuilding Co Ltd	33,755	2010
Handy 2	Samjin Shipbuilding Co Ltd	33,755	2010
Handy 3	Samjin Shipbuilding Co Ltd	33,755	2011
Handy 4	Samjin Shipbuilding Co Ltd	33,762	2011
Handy 5	Samjin Shipbuilding Co Ltd	33,755	2010
Handy 6	Samjin Shipbuilding Co Ltd	33,757	2010

Summary of Operating Data (unaudited)

							Three Months Ended December 31, 2019			Three Months Ended December 31, 2018		Year Ended December 31, 2019				Year Ended December 31, 2018
Revenue, net							15,422			18,928		60,442				67,162
Voyage expenses							(953		)	(1,350	)	(6,642			)	(8,149			)
Time charter equivalent revenue							14,469			17,578		53,800				59,013
Commercial revenue fee							172			9		265				9
Total							14,641			17,587		54,065				59,022
Vessel operating expense							(6,833		)	(7,062	)	(28,298			)	(28,827			)
Drydock expense							(57		)	-		(1,067			)	(2,449			)
Depreciation expense							(2,329		)	(2,427	)	(9,412			)	(8,936			)
General and administration expense							(1,096		)	(1,164	)	(3,637			)	(4,205			)
Gain on vessel disposition							2,927			-		6,778				-
Loss on debt extinguishment							-			(2	)	-				(1,289			)
Interest expense and finance cost							(1,221		)	(1,530	)	(5,566			)	(6,108			)
Interest income							50			64		320				625
Other expenses and taxes, net							(305		)	(290	)	(731			)	(884			)
Net Income							5,777			5,176		12,452				6,949
Less: Gain on vessel disposition							(2,927		)	-		(6,778			)	-
Add: Loss on debt extinguishment							-			2		-				1,289
Adjusted net Income (2)							2,850			5,178		5,674				8,238
Net Income per share, basic and diluted							0,23			0.19		0,48				0.25
Adjusted net Income per share, basic and diluted (2)							0,11			0.19		0,22				0.29
							Three Months Ended December 31, 2019			Three Months Ended December 31, 2018		Year Ended December 31, 2019				Year Ended December 31, 2018
Net Income /(loss)								5,777		5,176		12,452				6,949
Add: Depreciation expense								2,329		2,427		9,412				8,936
Add: Interest expense and finance cost								1,221		1,530		5,566				6,108
Add: Other taxes								55		72		248				211
Less: Interest income								(50	)	(64	)	(320			)	(625			)
EBITDA (1)								9,332		9,141		27,358				21,579
Less: Gain on vessel disposition								(2,927	)	-		(6,778			)	-
Add: Loss on debt extinguishment								-		2		-				1,289
Add: Drydock expense								57		-		1,067				2,449
Adjusted EBITDA (1)								6,462		9,143		21,647				25,317

1. Adjusted EBITDA represents net income/(loss) before interest, other taxes, depreciation and amortization, drydock expense, gain/(los)s on vessel disposition, restructuring costs and loss on debt extinguishment and is used as a supplemental financial measure by management to assess our financial and operating performance.  We believe that Adjusted EBITDA assists our management and investors by increasing the comparability of our performance from period to period.  We believe that including Adjusted EBITDA as a financial and operating measure benefits investor in selecting between investing in us and other investment alternatives.  Adjusted EBITDA does not represent and should not be considered as an alternative to net income/(loss) or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of Adjusted EBITDA may not be comparable to that reported by other companies.
2.  Adjusted net income/(loss) and related per share amounts is not a measure prepared in accordance with U.S. GAAP and should not be used in isolation or substitution of Company’s results.
    

Summary of Operating Data (unaudited)

Vessel Utilization:			Three Months Ended December 31, 2019			Three Months Ended December 31, 2018			Year Ended December 31, 2019			Year Ended December 31, 2018
Ship days (2)			1,642			1,748			6,656			6,429
Less: Off-hire days			45			5			64			70
Less: Off-hire days due to drydock			-			-			41			89
Operating days (3)			1,597			1,743			6,551			6,270
Fleet Utilization (4)			97.3		%	99.7		%	98.4		%	97.6		%
Commercial Ship days (8)			2,215			-			7,852			-
TCE per day- $ (1)			9,060			10,085			8,213			9,412
Opex per day- $ (6)			4,161			4,040			4,251			4,484
G&A expenses per day- $ (7)			667			665			546			654
G&A expenses basis commercial days -$ (9)			498			-			462			-
Vessels at period end			17			19			17			19
Average number of vessels during the period (5)			18			19			18			17

1. Time Charter Equivalent, or TCE revenue, are non-GAAP measures.  Our method of computing TCE revenue is determined by voyage revenues less voyage expenses (including bunkers and port charges).  Such TCE revenue, divided by the number of our operating days during the period, is TCE per day, which is consistent with industry practice.  TCE revenue is included because it is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance irrespective of changes in the mix of charter types (i.e., spot charters and time charters), and it provides useful information to investors and management.
2. Ship days: We define ship days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us.  Ship days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.
3. Operating days: We define operating days as the number of our ship days in a period less days required to prepare vessels acquired for their initial voyage and off-hire days associated with off-hire for undergoing repairs, drydocks or special surveys.  The Company uses operating days to measure the number of days in a relevant period during which vessels should be capable of generating revenues.
4. Fleet utilization is defined as the ratio of operating days to ship days.
5. 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 ship days divided by the number of calendar days in that period.
6. Opex per day: is calculated by dividing vessel operating expenses by ship days for the relevant time period.
7. G&A expenses per day: is calculated by dividing general and administrative expenses by ship days for the relevant time period.
8. Commercial Ship days: We define commercial ship days as the total of Ship days and the aggregate number of days during the period for which we have each vessel in our commercial fleet under our management. Commercial ship days are an indicator of the size of our owned and managed fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.
9. G&A expenses basis commercial days: is calculated by dividing running general and administrative expenses by commercial ship days for the relevant time period.

Condensed Consolidated Balance Sheets (Unaudited)  
(In thousands of U.S. Dollars)  

As at		December 31, 2019	December 31, 2018
ASSETS
Cash & cash equivalents		16,362	15,218
Restricted cash (current and noncurrent)		10,957	11,577
Vessel held for sale		7,350	-
Vessels, net		174,635	201,774
Other fixed assets		103	141
Other receivables		7,425	8,230
Total assets		216,832	236,940
LIABILITIES AND EQUITY
Accounts payable and accrued liabilities		5,014	4,340
Deferred revenue		1,144	682
Total debt, net of deferred finance costs		84,773	105,674
Total liabilities		90,931	110,696
Shareholders' equity		125,901	126,244
Total liabilities and shareholders’ equity		216,832	236,940

Condensed Consolidated Statement of Cash Flows (Unaudited) 
(In thousands of U.S. Dollars)                                                     

			Year Ended December 31, 2019		Year Ended December 31, 2018
Cash flows from operating activities
Net Income			12,452		6,949
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation			9,412		8,936
Amortization of deferred finance fees			330		552
Loss on debt extinguishment			-		1,289
Gain on vessel disposition			(6,778	)	-
Changes in operating assets and liabilities			1,730		(2,883			)
Net cash provided by operating activities			17,146		14,843
Cash flows from investing activities
Payments for vessel acquisition and improvements			(555	)	(39,240			)
Cash proceed from vessel sale			18,189		-
Purchase of other fixed assets			(71	)	(130			)
Net cash provided by/ (used in) investing activities			17,563		(39,370			)
Cash flows from financing activities
Loan Proceeds			-		93,710
Payment of Debt extinguishment fees			(21	)	(775			)
Loan repayments and prepayments			(21,209	)	(81,090			)
Payment of deferred finance fees and other loan fees			(160	)	(375			)
Repurchase of common stock			(2,609	)	(9,116			)
Dividends paid			(10,186	)	(24,854			)
Net cash used in financing activities			(34,185	)	(22,500			)
Net increase/ (decrease) in cash and cash equivalents			524		(47,027			)
Cash and cash equivalents and Restricted cash at the beginning of the year			26,795		73,822
Cash and cash equivalents and Restricted cash at year end			27,319		26,795

About Pioneer Marine Inc.

Pioneer Marine is a leading ship owner and global drybulk handysize transportation service provider. Pioneer Marine currently owns sixteen Handysize vessels and is commercial manager of seven Handysize vessels.

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 failure of counterparties to fully perform their contracts with us, the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for dry bulk vessel capacity, changes in our operating expenses, including bunker prices, drydock 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.

Contact:
Pioneer Marine Inc.
Torben Janholt CEO
+45 21 639 232, +30 212222 3750

Investor Relations / Media
Capital Link, Inc.
Kevin Karlis
+212 661 7566
pioneermarine@capitallink.com

 

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