Maroussi, Greece = November 14, 2018
Pyxis Tankers Inc. (NASDAQ Cap Mkts: PXS), (the "Company" or "Pyxis Tankers"), an emerging growth pure play product tanker company, today announced unaudited results for the three and nine months ended September 30, 2018.
• For the three months ended September 30, 2018, our time charter equivalent revenues, which we define as voyage revenues, net of voyage related costs and commissions, were $2.6 million, which resulted in net loss of $4.1 million, or loss per share (basic and diluted) of $0.20, and our Adjusted EBITDA was negative $1.5 million (see "Non-GAAP Measures and Definitions" below).
• On September 27, 2018, Eighthone Corp. ("Eighthone"), our vessel owning subsidiary that owns the Pyxis Epsilon, entered into a new $24.0 million loan agreement for the purpose of refinancing the outstanding indebtedness. After repayment of existing bank debt, the new 5-year secured loan provided us approximately $7.3 million of additional liquidity for general corporate purposes.
Valentios Valentis, our Chairman and CEO commented:
"The financial results for the third quarter of 2018 were disappointing. Our anticipated improvement in chartering activity late summer did not occur and, consequently, we suffered lower charter rates and vessel utilization. The spot chartering environment was especially difficult and attractive period charters of 12 months or more were virtually non-existent. In our opinion, there was no single demonstrative reason for these depressed conditions. During the quarter, we saw historically high refinery utilization in the U.S. But high seasonal U.S. domestic consumption of refined products combined with a stronger U.S. dollar resulted in lower exports out of the U.S. Gulf, especially within the Atlantic basin. Other contributing factors included extended refinery maintenance in certain parts of the globe, lower import activity in West Africa and intrusion by larger vessels, including crude carriers on their maiden voyages.
"During these challenging times, we have focused on improving balance sheet liquidity and maintaining a disciplined cost structure. The refinance of the indebtedness related to the Pyxis Epsilon in September provided us with a number of benefits, most importantly, $7.3 million of additional liquidity and a longer scheduled loan amortization. In the third quarter of 2018, our total daily operational costs for our eco-efficient and modified MR tankers increased by only 1% compared to the year-ago period, or to $7,938 per vessel, despite certain unscheduled repairs for the Pyxis Theta, performed during the vessel's special survey in the most recent quarter, and higher petroleum lubricant prices. Our substantially fixed cost structure combined with the current charter positions is expected to provide us with significant operating leverage when charter rates improve.
"We are still of the belief that charter rates have bounced off the bottom and that better times are ahead of us. While demand slowed slightly due to temporary and seasonal factors, global GDP growth remains solid. We believe the new IMO sulphur regulations for the shipping industry starting January 1, 2020 will be especially positive for the MR2 segment. Inventory stocking of alternatives to traditional bunker fuel, including the potential introduction of approved blends and more MGO, starting in the fall, 2019 should result in increasing trade routes and ton-mile demand for MR2. The size and flexibility of this class of vessel, especially for eco units, should lead to incremental demand, on top of the positive long term supply/demand fundamentals."
Results for the three months ended September 30, 2017 and 2018
For the three months ended September 30, 2018, we reported a net loss of $4.1 million, or $0.20 basic and diluted loss per share, compared to a net loss of $1.3 million, or $0.07 basic and diluted loss per share, for the same period in 2017. The increase in our net loss was primarily due to a $2.6 million decrease in time charter equivalent revenues and a $0.5 million increase in interest and finance costs, net, partially offset by a $0.2 million aggregate decrease in vessel operating expenses and general and administrative expenses. Our Adjusted EBITDA was negative $1.5 million, representing a decrease of $2.4 million from positive $0.8 million for the same period in 2017.
Results for the nine months ended September 30, 2017 and 2018
For the nine months ended September 30, 2018, we reported a net loss of $4.8 million, or $0.23 basic and diluted loss per share, compared to a net loss of $3.8 million, or $0.21 basic and diluted loss per share, for the same period in 2017. The increase in our net loss was primarily due to a $3.5 million decrease in time charter equivalent revenues, the non-cash vessel impairment charge of $1.5 million related to the write down of the carrying amount of Northsea Alpha and Northsea Beta to their fair values and a $0.9 million increase in interest and finance costs, net, partially offset by the gain from debt extinguishment of $4.3 million and a $0.5 million decrease in general and administrative expenses. Our Adjusted EBITDA was negative $0.3 million, representing a decrease of $2.9 million from positive $2.6 million for the same period in 2017.
About Pyxis Tankers Inc.
We own a modern fleet of six tankers engaged in seaborne transportation of refined petroleum products and other bulk liquids. We are focused on growing our fleet of medium range product tankers, which provide operational flexibility and enhanced earnings potential due to their "eco" features and modifications. We are positioned to opportunistically expand and maximize our fleet due to competitive cost structure, strong customer relationships and an experienced management team whose interests are aligned with those of its shareholders. For more information, visit: http://www.pyxistankers.com.
Pyxis Tankers Inc., press release