(Source: MARKETWIRE)
Nordic American Tanker Shipping Ltd. (NYSE: NAT) ("NAT" or "the Company") today announced its results for the 1st quarter of 2009. Based on its results for the quarter, the Company will pay a dividend of $0.88 per share on or about June 3, 2009 to shareholders of record as of May 20, 2009. Following this dividend payment, the Company will have paid a dividend for 47 consecutive quarters since the autumn of 1997 when the first three vessels in the Company's fleet were delivered and commenced operations.
In a separate press release today we have advised the market of an acquisition of a double hull suezmax tanker (built in 2002) bringing our fleet to sixteen vessels. The acquisition will be financed by the capital resources of the Company.
Having one of the strongest balance sheets in the industry, the Company is committed to continuing its simple, transparent and predictable strategy and full payout dividend policy.
The present instability in the international financial markets is serious for many shipping companies. NAT has a very strong position in this environment. The Company has no net debt, and at the time of this writing, an undrawn revolving credit facility of $500 million with a term up to September 2013. The Company raised net proceeds of approximately $107 million on January 13, 2009 from a follow-on offering of common shares. This provides NAT with enhanced financial flexibility going forward.
Our primary objective is to maximize total return [1] to our shareholders including maximizing the quarterly cash dividend.
The Company does not engage in any type of derivatives.
The Company has further acquisitions under evaluation and expects to continue to strengthen its position compared with that of its competitors.
Highlights:
-- The Board of Directors has declared a dividend of $0.88 per share in respect of 1Q09. For the last four quarters, including the dividend to be paid for 1Q09, a total of $4.96 has been declared in dividends, which represents 15.1% of the average daily share price over the same period. -- Net income for 1Q09 was $0.46 per share based on the weighted average number of shares outstanding during the quarter, 37,424,291, compared to $0.78 per share for 1Q08. -- In 1Q09 total off hire was 2 days. There are no planned dry dockings for any of the Company's vessels until 2010 when one vessel is scheduled for dry-docking. -- On January 13, 2009, the Company completed an underwritten public offering of 3,450,000 common shares which strengthened its equity by more than $107 million in order to increase the capacity of the Company to make further accretive acquisitions. -- On February 18, 2009, the Company took delivery of its 15th double- hull suezmax tanker. -- Notwithstanding the volatility in the financial and commodities markets, the sound suezmax tanker spot market continued in 1Q09. Going into 2Q09, the spot tanker market has tapered off while remaining subject to volatility. The Company does not predict future spot rates.
Financial Information:
The Board has declared a dividend of $0.88 per share in respect of 1Q09. This compares with a dividend of $1.18 per share which was declared in respect of 1Q08. The amount of dividends per share is above all a direct reflection of the level of the spot tanker market during the relevant quarter and the number of shares outstanding. The weighted average number of shares outstanding for the 1st quarter 2009 was 37,424,291.
Following the payment of the dividend in respect of 1Q09, the Company has for the last four quarters paid dividends in the aggregate of $4.96 per share, representing a yield of 15.1% per annum based on the average daily share price during the past twelve months up to April 1, 2009.
Net income for 1Q09 was $17.2m, or $0.46 per share (EPS) compared to net income of $23.4m, or $0.78 per share for the 1Q08. Non-cash G&A items, including compensation to the Manager in connection with the follow-on offering in January 2009, constitute $0.08 per share. As opposed to other issue related costs this non-cash item has been booked against the profit & loss account.
The Company's operating cash flow [2] was $33.3m for 1Q09, compared to $36.9m for 1Q08.
We consider our general and administrative costs per day per ship to be at a low level. We also continue to have a strong focus on keeping our vessel operating costs low, while always maintaining our commitment to safe vessel operations.
We estimate that our average cash breakeven level for our 13 existing vessels is below $10,000 per day per vessel. When the freight market is above this level, the Company can be expected to pay a dividend. The breakeven rate is the amount of average daily revenues our vessels would need to earn in the spot market in order to cover our vessel operating expenses, voyage expenses, if any, cash general and administrative expenses, interest expense and other financial charges.
As of the end of 1Q09, NAT does not have any net debt. At the time of this release, the Company has not drawn on its $500 million revolving credit facility. The credit facility, which matures in September 2013, is not subject to reduction by the lenders and there is no obligation to repay principal during the term of the facility.
