Safe Bulkers Inc. (SB) reported 4Q2010 earnings of $0.47 per share and a continuation of the their $0.15 per share dividend. Their dividend payout ratio is a very low 32% for a high dividend stock. SB closed at $8.95 today. The stock currently yields 6.7%. They are a dry bulk shipping company with 16 ships in their fleet. I have written several articles on them because they are one of the best high dividend stocks in my opinion.
http://www.myhighdividendstocks.com/category/high-dividend-stocks/sb
Here are some highlights from the earnings release (these are my words):
· Their fleet is young. The average age is only 3.80 years. The assumption is that they are more fuel efficient and less maintenance costs than older vessels.
· The dividend is stable and safe even at prevailing low Baltic Dry Index rates.
· The vessel operating costs are up slightly, but do not threaten their large margins.
· Earning power is stable. Their fleet is 78% rented out for 2011, 59% in 2012, and 54% in 2013. Most of their earnings are already known for the next few years. Those earnings alone could easily cover their existing dividend rates.
· They have a strong balance sheet. Their debt is less than 50% of assets. Their current ratio is good (current assets are over double of current liabilities
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Here is the Safe Bulkers press release with all the details:
SOURCE: Safe Bulkers, Inc.
Feb 09, 2011 16:05 ET
Safe Bulkers, Inc. Reports Fourth Quarter and Full Year 2010 Results and Declares Quarterly Dividend
ATHENS, GREECE--(Marketwire - February 9, 2011) - Safe Bulkers, Inc. (the "Company") (NYSE: SB), an international provider of marine drybulk transportation services, announced today its unaudited financial results for the fourth quarter and the year ended December 31, 2010. The Company also declared a quarterly dividend of $0.15 per share for the fourth quarter of 2010.
Summary of Fourth Quarter 2010 Results
-- Net revenue for the fourth quarter of 2010 increased by 13% to
$41.3 million from $36.6 million during the same period in 2009.
-- Net income for the fourth quarter of 2010 increased by 34% to
$31.1 million from $23.2 million during the same period in 2009.
-- EBITDA(1) for the fourth quarter of 2010 increased by 33% to
$37.9 million from $28.4 million during the same period in 2009.
-- Earnings per share for the fourth quarter of 2010 of $0.47, calculated
on a weighted average number of shares of 65,878,212, compared to $0.42
in the fourth quarter 2009, calculated on a weighted average number of
shares of 54,513,787.
-- Declaration of a dividend of $0.15 per share for the fourth quarter
of 2010.
Summary of Twelve Months Ended December 31, 2010 Results
-- Net revenue for the twelve months ended December 31, 2010 decreased by
5% to $157.0 million from $164.6 million during the same period in 2009.
-- Net income for the twelve months ended December 31, 2010 decreased by
34% to $109.6 million from $165.4 million during the same period
in 2009.
-- EBITDA for the twelve months ended December 31, 2010 decreased by 29% to
$133.4 million from $187.6 million during the same period in 2009.
-- Earnings per share for the twelve months ended December 31, 2010 of
$1.73, calculated on a weighted average number of shares of 63,300,466
compared to $3.03 in the twelve months ended December 31, 2009,
calculated on a weighted average number of shares of 54,510,587.
(1) EBITDA represents net income plus interest expense, tax, depreciation and amortization. See "EBITDA Reconciliation".
Fleet and Employment Profile
The Company's operational fleet as of December 31, 2010, was comprised of 16 drybulk vessels with an average age of 3.80 years.
As of December 31, 2010, the Company has contracted for eight additional drybulk newbuild vessels with deliveries scheduled at various times through 2013. The newbuilds consist of two Post-Panamax, three Kamsarmax, one Panamax and two Capesize vessels.
As of December 31, 2010, the remaining capital expenditure requirements for the delivery of the eight newbuilds, were $171.1 million for 2011, $70.4 million for 2012 and $22.2 for 2013. We anticipate satisfying these capital expenditure requirements from existing cash and time deposits, operating cash surplus and existing undrawn loan commitments.
On January 11, 2011, we contracted to acquire a Japanese-built, drybulk, Panamax-class newbuild at approximately $41.8 million, consisting of payments of $18.9 million and JPY 1.9 billion, with an expected delivery date in the first quarter of 2012.
As of January 31, 2011, the company has 1 existing and 8 newbuild vessels unencumbered and a $50 million long-term floating rate note facility against which additional loans can be drawn.
As of January 31, 2011, the contracted employment of the Company's fleet was 78% of fleet ownership days for the remaining days of 2011, 59% for 2012 and 54% for 2013, including vessels which are scheduled to be delivered to us in the future.
Dividend Declaration
The Company declared a cash dividend on its common stock of $0.15 per share payable on or about February 25, 2011 to shareholders of record at the close of trading of the Company's common stock on the New York Stock Exchange (the "NYSE") on February 18, 2011.
The Company had 65,879,916 shares of common stock issued and outstanding as of today.
The Board of Directors of the Company is continuing a policy of paying out a portion of the Company's free cash flow at a level it considers prudent in light of the current economic and financial environment. The declaration and payment of dividends, if any, will always be subject to the discretion of the Board of Directors of the Company. The timing and amount of any dividends declared will depend on, among other things: (i) our earnings, financial condition and cash requirements and availability, (ii) decisions in relation to our growth strategies, (iii) provisions of Marshall Islands and Liberian law governing the payment of dividends, (iv) restrictive covenants in our existing and future debt instruments and (v) global financial conditions. We can give no assurance that dividends will be paid in the future.
Management Commentary
Dr. Loukas Barmparis, President of the Company, said: "We are happy to announce today our unaudited financial results for the quarter and year ended December 31, 2010. Our revenues increased for the second consecutive quarter, supported by long term charters with our clients. Our Board has maintained a stable dividend policy by paying out a low percentage of free cash flows and declaring our eleventh consecutive quarterly dividend, of $0.15 per share, since our initial public offering in 2008. Our selective fleet expansion at attractive prices, funded to a large extent from operational surplus, will support our future revenues as newbuilds enter our fleet. We remain committed to the solid growth of our company, through flexible asset management and consistent chartering policy, for the benefit of our shareholders.''
Conference Call
On Thursday, February 10, 2011 at 9:00 A.M. EST, the Company's management team will host a conference call to discuss the financial results.
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (866) 819-7111 (US Toll Free Dial In), 0(800) 953-0329 (UK Toll Free Dial In) or +44 (0)1452-542-301 (Standard International Dial In). Please quote "Safe Bulkers" to the operator.
A telephonic replay of the conference call will be available until February 18, 2011 by dialing 1 (866) 247-4222 (US Toll Free Dial In), 0(800) 953-1533 (UK Toll Free Dial In) or +44 (0)1452 550-000 (Standard International Dial In). Access Code: 1859591#
Slides and Audio Webcast
There will also be a live, and then archived, webcast of the conference call, available through the Company's website (www.safebulkers.com). Participants in the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.
Management Discussion of Fourth Quarter 2010 Results
Net income increased by 34% to $31.1 million for the fourth quarter of 2010 from $23.2 million for the fourth quarter of 2009. This increase is mainly attributable to the following factors:
Net revenues: Net revenues were $41.3 million for the fourth quarter of 2010, a 13% increase compared to $36.6 million for the fourth quarter of 2009. Net revenues increased due to increases in the number of operating days and the Time Charter Equivalent ("TCE")(2) rate. The Company operated 15.3 vessels on average during the fourth quarter of 2010, earning a TCE rate of $29,395, compared to 14.0 vessels and a TCE rate of $28,605 during the fourth quarter of 2009. The increase in the TCE rate resulted mainly from higher time charter rates.
Vessel operating expenses: Vessel operating expenses increased by 21% to $6.3 million for the fourth quarter of 2010, compared to $5.2 million for the same period in 2009. The increase in operating expenses is mainly attributed to an increase in ownership days of 9% to 1,409 in the fourth quarter of 2010 from 1,288 in the fourth quarter of 2009 and to a further increase in crew, repairs, maintenance, spare parts and stores costs associated with the delivery of our latest newbuild vessel Venus Heritage. Daily vessel operating expenses increased by 10% to $4,463 for the fourth quarter of 2010, compared to $4,053 for the fourth quarter of 2009.
(Loss)/Gain on derivatives: Gain on derivatives increased to $4.9 million in the fourth quarter of 2010, compared to a loss of $1.2 million for the same period in 2009, as a result of the mark-to-market valuation of the Company's interest rate swap transactions that we employ to manage the risk and interest rate exposure of our loan and credit facilities. These swaps economically hedged the interest rate exposure of the Company's aggregate loans outstanding. The average remaining period of our swap contracts is 3.2 years as of December 31, 2010. The valuation of these interest rate swap transactions at the end of each quarter is affected by the prevailing interest rates at that time.
Depreciation: Depreciation increased to $5.4 million in the fourth quarter of 2010, compared to $3.9 million for the same period in 2009, as a result of the increase in the average number of vessels operated by the Company during the fourth quarter of 2010.
Cash, time deposits & restricted cash: As of December 31, 2010, we had $100.4 million in cash and short-term time deposits, $5.4 million in long-term restricted cash and $50.0 million in a long-term floating rate note, from which the Company may borrow up to 80% under certain conditions. Additionally, we have $82.7 million in an undrawn loan commitments, $24.0 million to be secured by our existing vessel Panayiota K and $58.7 million to be secured by our newbuild with Hull number 1074 expected to be delivered by the third quarter of 2011, whilst our recently delivered post-panamax newbuild vessel Venus Heritage remains debt free.
(2) Refer to definition of "TCE" in Note 6 of Fleet Data Table.
Management Discussion of the Twelve months ended December 31, 2010 Results
Net revenues: Net revenues for the twelve months ended December 31, 2010 decreased by 5% to $157.0 million from $164.6 million during the same period in 2009. The Company operated 14.6 vessels on average during the twelve months of 2010, earning a TCE rate of $29,534, compared to 13.2 vessels and a TCE rate of $34,208 during the twelve months of 2009.
Net income: Net income for the twelve months ended December 31, 2010 was $109.6 million, a decrease of 34% from net income of $165.4 million for the twelve months ended December 31, 2009. The decrease of $55.8 million is mainly attributed to: (i) early redelivery income of $0.1 million, compared to $75.0 million, (ii) zero loss on asset cancellations, compared to $20.7 million, (iii) gain on sale of assets of $15.2 million, compared to none, (iv) a loss on derivatives of $8.2 million, compared to a loss on derivatives of $4.4 million, (v) depreciation of $19.7 million, compared to $13.9 million, (vi) interest expense of $6.4 million, compared to $10.3 million, (vii) vessel operating expenses of $23.1 million, compared to $19.6 million, and (viii) net revenues of $157.0 million, compared to $164.6 million, during the twelve months of 2010 and 2009 respectively.
Unaudited Interim Financial Information and Other Data
SAFE BULKERS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE PERIODS ENDED DECEMBER 31, 2009 AND DECEMBER 31, 2010
Three Month Period Twelve Month Period
(In thousands of U.S. Ended December 31, Ended December 31,
Dollars except for share ---------------------- ----------------------
and per share data) 2009 2010 2009 2010
---------- ---------- ---------- ----------
REVENUES:
Revenues 37,435 41,908 168,400 159,698
Commissions (867) (621) (3,794) (2,678)
Net revenues 36,568 41,287 164,606 157,020
EXPENSES:
Voyage expenses (97) (134) (577) (610)
Vessel operating expenses (5,220) (6,289) (19,628) (23,128)
Depreciation (3,941) (5,421) (13,893) (19,673)
General and administrative
expenses (1,544) (2,011) (7,046) (7,018)
Early redelivery income - - 74,951 132
Loss on asset
cancellations - - (20,699) -
Gain on sale of assets - - - 15,199
Operating income 25,766 27,432 177,714 121,922
OTHER (EXPENSE) / INCOME:
Interest expense (1,523) (1,652) (10,342) (6,423)
Other finance costs (51) (147) (442) (331)
Interest income 298 380 2,164 2,627
(Loss)/gain on derivatives (1,241) 4,882 (4,416) (8,163)
Foreign currency (loss)/gain (65) 287 838 281
Amortization and write-off of
deferred finance charges (20) (50) (106) (266)
Net income 23,164 31,132 165,410 109,647
Earnings per share 0.42 0.47 3.03 1.73
Weighted average number of
shares 54,513,787 65,878,212 54,510,587 63,300,466
SAFE BULKERS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
AS OF DECEMBER 31, 2009 AND DECEMBER 31, 2010
December 31, December 31,
(In thousands of U.S. Dollars) 2009 2010
------------ ------------
ASSETS
Cash, time deposits, and restricted cash 82,714 100,415
Asset held for sale 16,969 -
Other current assets 5,965 3,861
Vessels, net 373,924 541,244
Advances for vessel acquisition and vessels
under construction 93,520 99,014
Other fixed assets, net 69 -
Restricted cash non-current 4,763 5,423
Long-term investment 50,000 50,000
Other non-current assets 800 5,415
Total assets 628,724 805,372
LIABILITIES AND EQUITY
Current portion of long-term debt & liability
directly associated with asset held for sale 50,242 27,674
Other current liabilities 15,309 25,309
Long-term debt, net of current portion 420,994 467,070
Other non-current liabilities 44,960 41,186
Shareholders' equity 97,219 244,133
Total liabilities and equity 628,724 805,372
Fleet Data
Three Months Ended Twelve Months Ended
&nbs
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