UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 5, 2021
(Exact name of registrant as specified in its charter) | ||||||||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (IRS employer identification no.) | ||||||
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(Registrant’s telephone number, including area code):(203 ) 276-8100
(Former Name or Former Address, if Changed Since Last Report): None
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On March 5, 2021, Eagle Bulk Shipping Inc., a Republic of the Marshall Islands corporation (the “Company”), posted to its website a corporate presentation including certain financial results and other information for the quarter ended December 31, 2020. A copy of the corporate presentation is attached as Exhibit 99.1 hereto.
The information in this Item 2.02 of this Current Report on Form 8-K, including the exhibit, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing. By filing this Current Report on Form 8-K and furnishing this information, the Company makes no statement or admission as to the materiality of any information in this Item 2.02 or the exhibit attached hereto.
Additionally, Exhibit 99.1 contains various non-GAAP financial measures as defined by Regulation G. Reconciliations of each non-GAAP financial measure to its comparable GAAP financial measure can be found in the attached corporate presentation.
This Current Report on Form 8-K and Exhibit 99.1 hereto contain forward-looking statements within the meaning of the federal securities laws. These forward looking statements are based on current expectations and are not guarantees of future performance. Further, the forward-looking statements are subject to the limitations listed in Exhibit 99.1 and in the other reports of the Company filed with the Securities and Exchange Commission, including that actual events or results may differ materially from those in the forward-looking statements.
ITEM 7.01. REGULATION FD DISCLOSURE.
On March 5, 2021, the Company posted to its website a corporate presentation described above in Item 2.02 of this Current Report on Form 8-K. A copy of the corporate presentation is attached hereto as Exhibit 99.1.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
| Exhibit Number | Description | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| EAGLE BULK SHIPPING INC. | ||||||||
| (registrant) | ||||||||
| Dated: March 5, 2021 | By: | /s/ Frank De Costanzo | ||||||
| Name: | Frank De Costanzo | |||||||
| Title: | Chief Financial Officer | |||||||
providing optimized global transportation of drybulk commodities Earnings Presentation Fourth Quarter 2020 5 March 2021
2 Disclaimer This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, and are intended to be covered by the safe harbor provided for under these sections. These statements may include words such as “believe,” “es timate,” “project,” “intend,” “expect,” “plan,” “anticipate,” and similar expressions in connection with any discussion of the timing or nature of future operating or financial performance or other events. Forward-looking statements reflect management’s current expectations and observations with respect to future events and financial performance. Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed, projected, or implied by those forward-looking statements. Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by those forward-looking statements. The principal factors that affect our financial position, results of operations and cash flows include charter market rates, which have declined significantly from historic highs, periods of charter hire, vessel operating expenses and voyage costs, which are incurred primarily in U.S. dollars, depreciation expenses, which are a function of the purchase price of our vessels and our vessels’ estimated useful lives and scrap value, general and administrative expenses, and financing costs related to our indebtedness. The accuracy of the Company’s assumptions, expectations, beliefs and projections depends on events or conditions that change over time and are thus susceptible to change based on actual experience, new developments and known and unknown risks. The Company gives no assurance that the forward-looking statements will prove to be correct and does not undertake any duty to update them. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors which could include the following: (i) changes in demand in the drybulk market, including, without limitation, changes in production of, or demand for, commodities and bulk cargoes, generally or in particular regions; (ii) greater than anticipated levels of drybulk vessel newbuilding orders or lower than anticipated rates of drybulk vessel scrapping; (iii) changes in rules and regulations applicable to the drybulk industry, including, without limitation, legislation adopted by international bodies or organizations such as the International Maritime Organization and the European Union (the “EU”) or by individual countries; (iv) actions taken by regulatory authorities including without limitation the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”); (v) changes in trading patterns significantly impacting overall drybulk tonnage requirements; (vi) changes in the typical seasonal variations in drybulk charter rates; (vii) changes in the cost of other modes of bulk commodity transportation; (viii) changes in general domestic and international political conditions; (ix) changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated dry docking costs); (x) significant deterioration in charter hire rates from current levels or the inability of the Company to achieve its cost-cutting measures; (xi) the duration and impact of the novel coronavirus (“COVID-19”) pandemic; (xii) the relative cost and availability of low and high sulfur fuel oil; (xiii) our ability to realize the economic benefits or recover the cost of the scrubbers we have installed; and (xiv) any legal proceedings which we may be involved from time to time; and other factors listed from time to time in our filings with the Securities and Exchange Commission (the “Commission”). We have based these statements on assumptions and analyses formed by applying our experience and perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate in the circumstances. The Company’s future results may be impacted by adverse economic conditions, such as inflation, deflation, or lack of liquidity in the capital markets, that may negatively affect it or parties with whom it does business. Should one or more of the foregoing risks or uncertainties materialize in a way that negatively impacts the Company, or should the Company’s underlying assumptions prove incorrect, the Company’s actual results may vary materially from those anticipated in its forward-looking statements, and its business, financial condition and results of operations could be materially and adversely affected.
3 Agenda 1 Highlights 2 Financial Summary 3 Industry Review * Appendix
Highlights
5 Executing on Growth ▪Raised USD 25 million* in new equity at USD 18.10 per share (December 2020) ▪Acquired seven vessels for ~USD 86.3 million in cash + 541,898 in shares Vessel Type Built Yard Scrubber Purchase Price Delivery Cash Shares 1 Oslo Eagle Ultramax 2015 Chengxi Yes $16.0m Jan 21 2 Helsinki Eagle Ultramax 2015 Chengxi Yes $16.5m Feb 21 3 Stockholm Eagle Ultramax 2016 Chengxi Yes $17.65m Mar 21 4 Rotterdam Eagle Ultramax 2017 Chengxi Yes $15.00m 212,315 2q21 5 Sankaty Eagle Supramax 2011 Dayang $7.05m 109,861 Mar 21 6 Montauk Eagle Supramax 2011 Dayang $7.05m 109,861 2q21 7 Newport Eagle Supramax 2011 Dayang $7.05m 109,861 2q21 ▪ USD 25 million gross, net proceeds received of USD 23.5 million, after offering fees
6 16 3 5 13 9 4 2 13 <5 5-7.5 7.5-10 10-12.5 12.5-15 >15 Fleet Vessels Acquired Vessels Sold 6 Significantly Improving Fleet Makeup ▪ Eagle fleet count as of March 5, 2021, including all pending acquisitions as shown on slide 5 ▪ Fleet Age Profile chart depicts current age of sold vessels. Fleet renewal/growth commenced in April 2016 Fleet Age Profile ▪ 52 ships in fleet inclusive of pending acquisitions ▪ Average age ~8.7yrs old Fleet Count + Vessel Size Evolution Fuel Consumption per DWT per Day 0.52 0.53 0.54 0.55 0.56 0.57 0.58 0.59 0.60 0.61 0.62 Avg Fuel Consumption per DWT per Sailing Day (Tons) 54 55 56 57 58 59 60 38 40 42 44 46 48 50 52 54 A v e ra g e D W T p e r S h ip ( M T , th o u sa n d s) F le e t C o u n t Fleet Count Average DWT
$2,938 $4,425 $5,670 $6,049 $7,825 $9,142 $8,660 $10,452 $11,052 $11,453 $11,281 $12,142 $9,607 $9,731 $11,014 $11,292 $10,075 $8,038 $9,620 $11,190 $15,085 0 200 400 600 800 1,000 1,200 1,400 $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 1q21e TC-in Days (RHS) Adj. net BSI Eagle TCE Eagle OPEX+G&A 7 Consistently Outperforming the Market Eagle Revenue + Cost Performance 1q21 EGLE TCE and TC-in days fixed to date as of Mar 4, 2021. 1q21 BSI includes Jan-Feb actual and Mar FFA curve as of Mar 2. TCE relative performance is benchmarked against Adj. net BSI = gross BSI net of commission, adjusted for owned-fleet specification, ex-scrubber. Outperformance from Q1 2020 onward is inclusive of both commercial performance and scrubber benefit. BSI-52 index used up through 4q18, and BSI-58 index used as from 1q19. G&A excludes stock-based compensation. Please refer to Appendix for full TCE definition and reconciliation 1q21 - 93% Fixed ▪ LTM TCE Outperformance of USD 1,964 per day
-$14 -$7 -$3 -$2 $5 $9 $8 $17 $19 $21 $20 $23 $15 $10 $13 $10 $19 $2 $12 $22 $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $(15) $(10) $(5) $- $5 $10 $15 $20 $25 $30 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 U S D p e r d a y U S D , m il li o n s Core Business TCE Underperformance TCE Outperformance Adj. EBITDA Adj. Net BSI (RHS) 8 TCE Outperformance Drives Incremental EBITDA ▪ Please refer to Appendix for definition of Adjusted EBITDA and reconciliation ▪ Please refer to Appendix for TCE definition and reconciliation ▪ Core Business reflects EBITDA generated by TCE performance at index level (i.e. no out/under-performance) less OPEX and cash G&A Historical Adjusted EBITDA LTM TCE Outperformance equates to ~USD 37 million of incremental EBITDA, basis proforma fleet of 52 ships, on an annualized basis
Financial Summary
10 1 – Includes non-cash interest expense related to the amortization of the equity component of the convertible bond of $1.0 million for 4q20, $1.0 million for 3q20, $0.9 million for 4q19, $3.9 million for FY 2020, and $1.5 million for FY 2019. 2 – Weighted average shares outstanding and EPS adjusted to give effect for the 1 for 7 reverse stock split that became effective on September 15, 2020 3 – Please see the Definitions slide in the Appendix for an explanation of Adjusted EBITDA Income Statement USD in Thousands except EPS 4q20 3q20 4q19 FY 2020 FY 2019 Revenues, net of commissions 75,181$ 68,182$ 71,486$ 275,134$ 292,378$ Operating expenses Voyage expenses 19,589 19,628 21,442 89,549 87,701 Charter hire expenses 5,459 5,061 8,152 21,280 42,169 Vessel expenses 20,847 21,749 22,336 86,528 82,342 Depreciation and amortization 12,570 12,618 11,322 50,157 40,546 General and administrative expenses 8,809 7,996 10,140 31,532 35,042 Other operating expense - - 1,125 - 1,125 Loss/(gain) on sale of vessels 101 389 66 490 (5,979) Lease impairment - - - 352 - Total operating expenses 67,373 67,440 74,582 279,889 282,945 Operating income / (loss) 7,808 743 (3,096) (4,755) 9,433 Other expenses Interest expense,net - cash 6,872 7,322 7,047 28,863 24,926 Interest expense - debt discount & deferred financing costs 1 1,617 1,609 1,519 6,272 3,784 Loss/(gain) on derivatives (796) 2,971 (490) (4,827) 150 Loss on debt extinguishment - - - - 2,268 Total other expenses, net 7,693 11,902 8,076 30,308 31,128 Net income / (loss) 115$ (11,159)$ (11,171)$ (35,063)$ (21,695)$ Weighted average shares outstanding (Basic) 2 10,415 10,280 10,211 10,310 10,195 EPS (Basic) 2 0.01$ (1.09)$ (1.09)$ (3.40)$ (2.13)$ Adjusted EBITDA 3 22,022$ 11,519$ 9,780$ 54,120$ 48,675$
11 Liquidity Trend (USD millions) Liquidity Position (USD thousands) $- $20 $40 $60 $80 $100 $120 $140 $160 $180 Revolver Availability Cash (Includes Restricted Cash) Balance Sheet (USD thousands) - Dec 31, 2020 Cash 1 88,849 Revolver undrawn availability 55,000 Total liquidity 143,849 Balance Sheet + Liquidity 1 – Cash balance includes cash, cash equivalents and restricted cash. 2 – Debt is net of $23.4m of debt discount and deferred financing costs Cash 1 88,849 Accounts receivable 13,843 Inventory 11,625 Other current assets 4,023 Vessels, net 810,714 Right of use assets - lease 7,541 Other assets 30,532 Total assets 967,127 Accounts payable 10,590 Current liabilities 24,991 Debt (including $39.2M current) 2 452,175 Fair value of derivatives - LT 651 Lease liability ($7.6M current) 8,302 Total liabilities 496,709 Stockholder's equity 470,418 Total liabilities and stockholder's equity 967,127
(2) (4) 7 7 15 10 14 7 12 (3) 10 3 (12) (3) 13 15 13 2 5 3 13 12 12 12 16 10 6 8 - 6 (7) - 11 10 (13) (8) (3) 2 7 12 17 1q17 2q17 3q17 4q17 1q18 2q18 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 FY 20 Cash flow from operations ex Changes in operating assets and liabilities 12 ▪ Cash balances at beginning and end of period include 1) cash, 2) cash equivalents, and 3) restricted cash Cash Flow from Operations - Quarterly ($ Millions) Cash Flow
13 ▪ Cash balances at beginning and end of period include 1) cash, 2) cash equivalents, and 3) restricted cash ▪ [1] Debt proceeds in YTD chart is net of RCF repayment in 3q20 4q20 Cash Walk ($ Millions) Cash Walk FY 2020 Cash Walk ($ Millions)
14 4q20 Cash Breakeven by Category ▪ G&A excludes stock-based compensation for all periods shown. G&A for FY 2020 and FY 2019 excludes certain non-recurring expenses. Cash Breakeven per Vessel per Day FY 2020 4q20 3q20 FY 2019 Operating Vessel expenses 4,790$ 4,718$ 4,784$ 4,859$ Drydocking 791 784 936 702 G&A* 1,561 1,824 1,596 1,681 Total operating 7,142 7,325 7,316 7,243 Debt Service Interest Expense 1,598 1,555 1,611 1,471 Debt Principal Repayment 2,033 2,673 1,718 1,366 Total Cash Breakeven 10,774$ 11,553$ 10,644$ 10,080$ Vessel Expenses 53% Drydocking 9% G&A* 21% Interest Expense 17%
Industry Review
16 Baltic Supramax Index (BSI) ▪ Source(s): Clarksons Market Off to a Strong Start $- $5,000 $10,000 $15,000 $20,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2016 2017 2018 2019 2020 2021
$15,097 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 BSI (Actual) 25 year average 17 ▪ Source(s): Clarksons ▪ Supramax Spot is based on the BSI-58. Historical averages are based on BSI-58, BSI-52, Supramax 52k dwt Avg Trip Tate, and the Handymax 45k dwt. Avg Trip Rate. Baltic Supramax Index (BSI) Spot Rates at a 10yr High Annual Averages 2018 $11,487 2019 $9,948 2020 $8,189 2021 YTD $13,864
$0 $100 $200 $300 $400 $500 $600 $700 $800 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Market Fuel Spread Eagle Hedge Value HSFO VLSFO Fuel Prices (USD per MT) 18 ▪ Source: Clarksons. VLSFO and HSFO average of historical prices at Fujairah, Houston, Rotterdam, and Singapore. IMO 2020 Implementation Date Spot Fuel Spread Currently Trading at ~$120/MT VLSFO HSFO For 2020, Eagle was able to realize a total fuel spread of ~$150/MT, comprised of average market fuel spread of ~$100/MT plus ~$50/MT generated from spread hedges put on prior to the outbreak of COVID-19.
-40 -20 0 20 40 60 80 100 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021f 2022f Total Deliveries Total Demolition Drybulk Net Supply Supramax/Ultramax Net Supply Supramax/Ultramax 2021f Net Fleet Growth ~2.2% 19 ▪ Figures are in million DWT ▪ Source(s): Clarksons (February 2021) Drybulk Deliveries + Scrapping (DWT) Net Fleet Growth Drybulk Supramax / Ultramax 2020 3.7% 3.6% 2021f 2.6% 2.2% 2022f 0.7% 1.2%
-5.0% -3.0% -1.0% 1.0% 3.0% 5.0% 7.0% 9.0% 11.0% 13.0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020f 2021f 2022f Drybulk Trade GDP (IMF) Shaded area represents range of GDP forecasts for 2021-2022 20 ▪ Source(s): Clarksons (February 2021), IMF (January 2021), Bloomberg Strong Demand Recovery Expected in 2021 Drybulk Trade (ton-miles) vs. Global GDP
21 ▪ Source(s): Clarksons (February 2021) ▪ Cargoes loaded during the 12 months ended December 31, 2020. ▪ Metal & Ore group includes: Manganese ore, scrap, copper concentrate, bauxite. Minerals group includes: Salt, gypsum, feldspar, limestone Minor Bulks Expected to Grow by 4.2% in 2021 Annualized Growth Rates 3-yr avg Last Current 2017-19 2020 2021f Global GDP 3.4% -3.5% 5.5% China 6.3% 2.3% 8.1% India 5.8% -8.0% 11.5% Dry Bulk (all) 2.3% -1.9% 3.7% Iron Ore 0.9% 3.2% 2.7% Coal 4.1% -9.5% 4.8% Grains 2.0% 7.8% 1.8% Minor Bulks 2.5% -3.2% 4.2% EGLE Cargo Mix (FY 2020) Coal, 16% Grain, 10% Iron Ore, 7% Other, 1% Minerals, 16% Metal & Ore, 14% Steel Products, 8% Cement, 10% Coke, 9% Fertilizer, 5% Agriculture Products, 4% Forest Products, 0.2% Eagle derives about 2/3 of cargo demand from minor bulk commodities
APPENDIX
23 Corporate Structure Eagle Bulk Mgmt. LLC Eagle Bulk Shipping Inc. (Parent | NASDAQ: EGLE) 100% 100% EBSC debt is non- recourse to the parent All management services (strategic / commercial / operational / technical / administrative) are performed in house by Eagle Bulk Management LLC, a wholly-owned subsidiary of the Parent 1 vessel Eagle Bulk Holdco LLCEagle Bulk Shipco LLC 20 vessels 100% ▪ Eagle fleet count as of March 5, 2021, including all pending acquisitions as shown on slide 5 Acquisition Vessels 5 vessels 26 vessels Eagle Bulk Ultraco LLC 100%
24 Eagle Debt Terms PARENT Eagle Bulk Shipping Inc. ISSUER/ BORROWER Eagle Bulk Shipping Inc. Eagle Bulk Shipco LLC Eagle Bulk Ultraco LLC LOAN TYPE Convertible Note Bond RCF Term Loan RCF AMOUNT USD 114m USD 200m USD 15m USD 210m USD 55m OUTSTANDING USD 114m USD 180m USD 15m USD 166m - SECURITY Senior Unsecured Senior Secured Super Senior Secured Senior Secured RECOURSE Parent Guarantee Ringfenced and non-recourse to the Parent Parent Guarantee COLLATERAL N/A 20 vessels + restricted cash 26 vessels INTEREST RATE 5.0% fixed 8.25% fixed L+200bps L+250bps INTEREST RATE SWAPS IN PLACE N/A N/A N/A 100% of Outstanding Amount at 58bps N/A MATURITY 2024 2022 2024 AMORTIZATION N/A USD 8m/year N/A USD 31.2m/year CONVERSION 25.453 shares common stock per USD 1,000 principal (approx. share price of USD 39.29) N/A N/A ▪ Debt amounts outstanding as of December 31, 2020. ▪ Eagle fleet count as of March 5, 2021. Acquired vessels not yet delivered to Eagle are not reflected in this slide. Please refer to the “Owned Fleet” slide in the appendix for further details.
25 Owned Fleet Scrubber Built DWT Scrubber Built DWT Scrubber Built DWT 1 Singapore Eagle * 2017 63.4 1 Hong Kong Eagle * 2016 63.5 1 Helsinki Eagle * 2015 63.6 2 Shanghai Eagle * 2016 63.4 2 Santos Eagle * 2015 63.5 3 Oslo Eagle * 2015 63.7 3 Copenhagen Eagle * 2015 63.5 1 Vessel 64 4 Stamford Eagle 2016 61.5 4 Sydney Eagle * 2015 63.5 5 Sandpiper Bulker * 2011 57.8 5 Dublin Eagle * 2015 63.5 6 Roadrunner Bulker * 2011 57.8 6 New London Eagle * 2015 63.1 7 Puffin Bulker * 2011 57.8 7 Cape Town Eagle * 2015 63.7 8 Petrel Bulker * 2011 57.8 8 Westport Eagle * 2015 63.3 9 Owl * 2011 57.8 9 Hamburg Eagle * 2014 63.3 10 Oriole * 2011 57.8 10 Madison Eagle * 2013 63.3 11 Egret Bulker * 2010 57.8 11 Greenwich Eagle * 2013 63.3 12 Crane * 2010 57.8 12 Groton Eagle * 2013 63.3 13 Canary * 2009 57.8 13 Fairfield Eagle * 2013 63.3 14 Bittern * 2009 57.8 14 Southport Eagle * 2013 63.3 Scrubber Built DWT 15 Stellar Eagle * 2009 56.0 15 Rowayton Eagle * 2013 63.3 1 Rotterdam Eagle * 2017 63.7 16 Crested Eagle * 2009 56.0 16 Mystic Eagle * 2013 63.3 2 Stockholm Eagle * 2016 63.3 17 Crowned Eagle * 2008 55.9 17 Stonington Eagle * 2012 63.3 3 Montauk Eagle 2011 57.8 18 Jaeger 2004 52.5 18 Nighthawk * 2011 57.8 4 Newport Eagle 2011 57.8 19 Cardinal 2004 55.4 19 Martin * 2010 57.8 5 Sankaty Eagle 2011 57.8 20 Tern 2003 50.2 20 Kingfisher * 2010 57.8 21 Jay * 2010 57.8 22 Ibis Bulker * 2010 57.8 23 Grebe Bulker * 2010 57.8 24 Gannet Bulker * 2010 57.8 25 Imperial Eagle * 2010 56.0 26 Golden Eagle * 2010 56.0 20 Vessels 1,156 26 Vessels 1,594 5 Vessels 300 Acquistion Vessels Vessel Vessel Vessel Eagle Bulk Holdco LLC Vessel 52 Vessels | 45 Scrubber-fitted | 3114 DWT (MT, thousands) | 8.7 yrs-old Eagle Bulk Shipco LLC Eagle Bulk Ultraco LLC ▪ Eagle fleet count as of March 5, 2021, including all pending acquisitions as shown on slide 5
26 TCE Reconciliation ▪ Please see the Definitions slide in the Appendix for an explanation of Owned Available Days $ Thousands except TCE and days 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18 Revenues, net 21,278$ 25,590$ 35,788$ 41,836$ 45,855$ 53,631$ 62,711$ 74,587$ 79,371$ 74,939$ Less: Voyage expenses (9,244) (7,450) (11,208) (14,192) (13,353) (13,380) (17,463) (18,155) (22,515) (17,205) Charter hire expenses (1,489) (1,668) (3,822) (5,866) (3,873) (6,446) (9,652) (11,312) (10,268) (10,108) Reversal of one legacy time charter 1,045 793 670 432 (302) 584 329 426 (86) (404) Realized gain/(loss) - Derivatives - - (449) (113) - 83 248 (349) 117 345 TCE revenue 11,590$ 17,265$ 20,979$ 22,097$ 28,326$ 34,473$ 36,173$ 45,197$ 46,619$ 47,567$ Owned available days * 3,945 3,902 3,700 3,653 3,620 3,771 4,177 4,324 4,218 4,153 TCE 2,938$ 4,425$ 5,670$ 6,049$ 7,825$ 9,142$ 8,660$ 10,452$ 11,052$ 11,453$ $ Thousands except TCE and days 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 Revenues, net 69,093$ 86,692$ 77,390$ 69,391$ 74,110$ 71,486$ 74,378$ 57,392$ 68,182$ 75,181$ Less: Voyage expenses (15,126) (24,721) (25,906) (20,907) (19,446) (21,442) (26,564) (23,768) (19,628) (19,589) Charter hire expenses (7,460) (10,209) (11,492) (11,179) (11,346) (8,152) (6,041) (4,719) (5,061) (5,459) Reversal of one legacy time charter 497 (226) (414) 767 (120) (270) 463 (42) (88) 116 Realized gain/(loss) - Derivatives 284 (211) (475) 861 (806) 294 756 7,164 (1,029) (2,365) TCE revenue 47,288$ 51,326$ 39,102$ 38,933$ 42,393$ 41,917$ 42,992$ 36,027$ 42,377$ 47,883$ Owned available days * 4,192 4,227 4,070 4,001 3,849 3,712 4,267 4,482 4,405 4,279 TCE 11,281$ 12,142$ 9,607$ 9,731$ 11,014$ 11,292$ 10,075$ 8,038$ 9,620$ 11,190$
27 EBITDA Reconciliation ▪ Please see the Definitions slide in the Appendix for an explanation of Adjusted EBITDA USD in Thousands 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18 Net Income / (Loss) $ (39,279) $ (22,496) $ (19,359) $(142,389) $ (11,068) $ (5,888) $ (10,255) $ (16,584) $ 53 $ 3,451 Less adjustments to reconcile: Interest expense 2,818 4,903 7,434 6,644 6,445 6,859 7,837 8,236 6,261 6,387 Interest income (3) - (88) (124) (190) (186) (143) (133) (95) (112) EBIT (36,464) (17,593) (12,013) (135,868) (4,813) 785 (2,561) (8,481) 6,219 9,726 Depreciation and amortization 9,397 9,654 9,854 9,979 7,493 8,021 8,981 9,196 9,276 9,272 EBITDA (27,068) (7,939) (2,159) (125,889) 2,680 8,805 6,420 715 15,495 18,998 Less adjustments to reconcile: Stock-based compensation 827 842 (735) 1,273 2,171 2,478 2,350 1,740 3,511 2,410 One-time and non-cash adjustments 11,756 436 (509) 122,656 (297) (1,977) (373) 14,764 (170) (276) Adjusted EBITDA* $ (14,486) $ (6,661) $ (3,403) $ (1,961) $ 4,553 $ 9,307 $ 8,397 $ 17,219 $ 18,835 $ 21,132 USD in Thousands 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 Net Income / (Loss) $ 2,585 $ 6,486 $ 29 $ (5,992) $ (4,563) $ (11,171) $ (3,528) $ (20,491) $ (11,159) $ 115 Less adjustments to reconcile: Interest expense 6,574 6,521 6,762 6,733 8,117 8,965 9,192 8,737 8,954 8,510 Interest income (129) (248) (434) (393) (640) (400) (157) (56) (24) (21) EBIT 9,030 12,759 6,357 348 2,914 (2,606) 5,507 (11,810) (2,229) 8,604 Depreciation and amortization 9,460 9,708 9,407 9,761 10,056 11,322 12,466 12,503 12,618 12,570 EBITDA 18,490 22,467 15,764 10,109 12,970 8,715 17,974 693 10,389 21,174 Less adjustments to reconcile: Stock-based compensation 2,100 1,187 1,445 1,227 1,155 998 836 723 741 748 One-time and non-cash adjustments (406) (165) (1,838) (967) (971) 66 - 352 389 101 Adjusted EBITDA* $ 20,184 $ 23,489 $ 15,372 $ 10,370 $ 13,154 $ 9,780 $ 18,810 $ 1,768 $ 11,519 $ 22,022
$5.4 $5.2 $10.1 $7.4 $2.6 $1.7 $0.1 $0.3 165 135 202 212 121 146 74 78 1q21 2q21 3q21 4q21 1q22 2q22 3q22 4q22 Drydock Ballast Water Vessel Upgrades Offhire Days 28 Capex Schedule Estimated Capital Expenditures + Offhire Days Includes forecast amounts relating to recently-acquired vessels as shown on slide 5. Actual duration of off-hire days will vary based on the condition of the vessel, yard schedules and other factors. Actual costs will vary based on various factors, including where the drydockings are actually performed. BWTS requires advance payments as per the contract terms. ▪ Drydock - represents capex relating to statutory maintenance. ▪ Ballast Water - represents capex relating to the installation of IMO-mandated ballast water treatment systems. ▪ Vessel Upgrades - represents capex relating to items such as high-spec low friction hull paint which improves fuel efficiency and reduces fuel costs, NeoPanama Canal chock fittings enabling vessels to carry additional cargo through the new Panama Canal locks, as well as other retrofitted fuel-saving devices. Vessel Upgrades are discretionary in nature and evaluated on a business case-by-case basis. ▪ Offhire Days - represents the estimated days fleet is offhire due to drydock plus an additional allowance for unforeseen events.
29 Evaluating TCE Relative Performance Supramax/Ultramax TCE Performance Matrix This page is meant to assist analysts/investors on how to potentially evaluate and forecast vessel/fleet TCE relative performance within the Supramax/Ultramax segment For Illustrative Purposes Only A Chinese 60-65k DWT Ultramax should earn a premium of 2-13% to the net BSI-58, depending on its specific design characteristics, due to cargo carrying capacity, speed, and fuel consumption differences The BSI-58 is based on the 58k DWT Japanese TESS-58 design Supramax and is gross of commissions Matrix depicts the estimated TCE Earnings Performance range for a generic Supramax/Ultramax vessel type as compared to the BSI-58 ship ▪ Since the Supramax/Ultramax segment is comprised of a number of different ship types / sizes / designs, TCE generation ability can differ significantly from the standard vessel used to calculate the BSI-58 benchmark ▪ For example, a 2013-built Chinese 60-65k DWT Ultramax should be expected to earn a significant premium to a 2013-built 55-60k Supramax, particularly given the incremental cost of the 60-65k DWT vessel ▪ Ultimately, it’s about yield – the expected earnings ability of a vessel versus its cost ▪ The Matrix is meant to capture general ship types but there are likely some vessels which fall outside the stated figures. The index factors shown were calculated using a TCE of USD 10,000 per day and fuel cost of USD 400 per ton. The specific index factors can change somewhat with movements in both fuel prices and (spot) rate environment, but the relative relationships will remain similar to those shown. FROM TO FROM TO FROM TO BSI-58 1 50,000 55,000 86.0% 95.0% 81.0% 87.0% 2 55,000 60,000 96.0% 106.0% 88.0% 97.0% 3 60,000 65,000 106.0% 118.0% 102.0% 113.0% SHIP TYPE 100.0% JAPAN CHINA SIZE (DWT) VESSEL TYPE INDEX FACTOR (AS COMPARED TO THE BSI VESSEL) 58,000
30 Definitions Item Description Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that is used as a supplemental financial measure by our management and by external users of our financial statements, such as investors, commercial banks and others, to assess our operating performance as compared to that of other companies in our industry, without regard to financing methods, capital structure or historical costs basis. Our Adjusted EBITDA should not be considered an alternative to net income/(loss), operating income/(loss), cash flows provided by/(used in) operating activities or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP. Our Adjusted EBITDA may not be comparable to similarly titled measures of another company because all companies may not calculate Adjusted EBITDA in the same manner. Adjusted EBITDA represents EBITDA adjusted to exclude the items which represent certain non-cash, one-time and other items such as vessel impairment, lease impairment, gain/(loss) on sale of vessels, stock-based compensation, loss on debt extinguishment and restructuring expenses that the Company believes are not indicative of the ongoing performance of its core operations. TCE Time charter equivalent ("TCE") is a non-GAAP financial measure that is commonly used in the shipping industry primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per-day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts. The Company defines TCE as shipping revenues less voyage expenses and charter hire expenses, adjusted for the impact of one legacy time charter and realized gains on FFAs and bunker swaps, divided by the number of owned available days. TCE provides additional meaningful information in conjunction with shipping revenues, the most directly comparable GAAP measure, because it assists Company management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance. The Company's calculation of TCE may not be comparable to that reported by other companies. The Company calculates relative performance by comparing TCE against the Baltic Supramax Index ("BSI") adjusted for commissions and fleet makeup. The BSI was initiated in 2006 based on the Tess 52 design. The index for the Tess 58 design has been published commencing on April 3, 2017, and transition was completed as of December 2018, when the Baltic stopped publishing a dynamic Tess 52 daily rate. The Company has now switched to the Tess 58 index for valuation modeling as of January 1, 2019. The change in the BSI may affect comparability of our TCE against BSI in periods prior to Company switching to the Tess 58 index. Owned available days is the aggregate number of days in a period during which each vessel in our fleet has been owned by us less the aggregate number of days that our vessels are off-hire due to vessel familiarization upon acquisition, repairs, vessel upgrades or special surveys. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
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