Scorpio Bulkers Inc. Announces Financial Results for the Fourth Quarter of 2019 and Declares a Quarterly Cash Dividend

Monaco - Jan 27, 2020

Scorpio Bulkers Inc. (NYSE: SALT) (“Scorpio Bulkers”, or the “Company”), today reported its results for the three months ended December 31, 2019.

The Company also announced that on January 27, 2020, its Board of Directors declared a quarterly cash dividend of $0.02 per share on the Company’s common shares.

Results for the Three and Twelve Months Ended December 31, 2019 and 2018

For the fourth quarter of 2019, the Company’s GAAP net income was $15.1 million, or $0.21 per diluted share, including:

• a non-cash gain of approximately $46.1 million and cash dividend income of $0.5 million, or $0.66 per diluted share, primarily from the Company’s equity investment in Scorpio Tankers Inc.;

• a write-down of assets held for sale of approximately $25.2 million, or $0.36 per diluted share, related to the classification of four Ultramax vessels as held for sale; and

• a write-off of approximately $0.2 million of deferred financing costs on the credit facility related to the SBI Puma and the SBI Cougar.

For the same period in 2018, the Company’s GAAP net loss was $7.4 million, or $0.11 per diluted share. These results include a non-cash loss of approximately $7.7 million and cash dividend income of $0.5 million, or $0.10 per diluted share, from the Company’s equity investment in Scorpio Tankers Inc. and a write-off of deferred financing costs of $1.7 million, or $0.03 per diluted share, related to the refinancing of debt.

Total vessel revenues for the fourth quarter of 2019 were $60.3 million, compared to $65.2 million for the same period in 2018. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the fourth quarters of 2019 and 2018 were $41.5 million and $23.3 million, respectively (see Non-GAAP Financial Measures below).

For the fourth quarter of 2019, the Company’s adjusted net income was $40.6 million, or $0.57 adjusted per diluted share, which excludes the impact of the write-down of assets held for sale of approximately $25.2 million relating to the classification of four Ultramax vessels as held for sale and the write-off of approximately $0.2 million of deferred financing costs on the credit facility related to the SBI Puma and the SBI Cougar. Adjusted EBITDA for the fourth quarter of 2019 was $66.7 million. There were no such non-GAAP adjustments to net loss in the fourth quarter of 2018 (see Non-GAAP Financial Measures below).

For the year ended December 31, 2019, the Company’s GAAP net income was $44.7 million, or $0.64 per diluted share, including:

• a non-cash gain of approximately $114.7 million and cash dividend income of $2.2 million, or $1.68 per diluted share, primarily from the Company’s equity investment in Scorpio Tankers Inc.;

• a write-down of assets either sold or held for sale of approximately $38.0 million, or $0.55 per diluted share, related to the classification of four vessels as held for sale, the sales of the SBI Electra, SBI Flamenco, SBI Cougar and SBI Puma and the write-off of deferred financing costs on the credit facilities related to the four vessels sold; and

• the write-off of deferred financing costs of approximately $3.1 million, or $0.04 per diluted share, related to the refinancing of existing debt.

For the same period in 2018, the Company’s GAAP net loss was $12.7 million, or $0.18 per diluted share, including a non-cash loss of approximately $7.7 million and cash dividend income of $0.5 million, or $0.10 per diluted share, from the Company’s equity investment in Scorpio Tankers Inc. and a write-off of deferred financing costs of $3.8 million, or $0.05 per diluted share, related to the refinancing of debt.

Total vessel revenues for the year ended December 31, 2019 were $224.6 million, compared to $242.5 million for the same period in 2018. EBITDA for the year ended December 31, 2019 and 2018 were $158.3 million and $100.6 million, respectively (see Non-GAAP Financial Measures below).

For the year ended December 31, 2019, the Company’s adjusted net income was $82.6 million, or $1.19 adjusted per diluted share, which excludes the impact of the write-down of assets either sold or held for sale of $37.3 million and the write-off of deferred financing costs on the credit facilities relating to the vessels sold of $0.7 million. Adjusted EBITDA for the year ended December 31, 2019 was $195.6 million. There were no such non-GAAP adjustments to net loss in the year ended December 31, 2018 (see Non-GAAP Financial Measures below).

TCE Revenue
TCE Revenue Earned during the Fourth Quarter of 2019 (see Non-GAAP Financial Measures)

• Our Kamsarmax fleet earned an average of $11,934 per day

• Our Ultramax fleet earned an average of $11,244 per day

Voyages Fixed thus far for the First Quarter of 2020, as of the date hereof

• Kamsarmax fleet: approximately $12,242 per day on average for 57% of the days

• Ultramax fleet: approximately $10,505 per day on average for 49% of the days

Cash and Cash Equivalents
As of January 24, 2020, the Company had approximately $65.9 million in cash and cash equivalents.



Recent Significant Events

Special Stock Dividend
In the fourth quarter of 2019, the Company’s Board of Directors declared a one-time special stock dividend to the shareholders of the Company of an aggregate of approximately one million shares of common stock of Scorpio Tankers Inc. (NYSE:STNG), a related party. For each common share that a shareholder held in the Company on November 15, 2019, that shareholder received 0.0138 shares of common stock of Scorpio Tankers Inc. Following the payment of the special dividend, the Company continues to own approximately 4.4 million common shares of Scorpio Tankers Inc.

Quarterly Cash Dividend
In the fourth quarter of 2019, the Company’s Board of Directors declared and the Company paid a quarterly cash dividend of $0.02 per share totaling approximately $1.4 million.

On January 27, 2020, the Company’s Board of Directors declared a quarterly cash dividend of $0.02 per share, payable on or about March 13, 2020, to all shareholders of record as of February 14, 2020. As of January 24, 2020, 72,482,958 shares were outstanding.

Vessel Sales
In October 2019, the Company completed the sale of the SBI Puma and SBI Cougar, 2014 and 2015 built Ultramax vessels, respectively, that the Company agreed to sell in September 2019, for approximately $37.9 million in aggregate to an unaffiliated third party. The Company recorded a loss of approximately $4.9 million in the second quarter of 2019 and wrote-off deferred financing costs of approximately $0.2 million in the fourth quarter of 2019 upon the repayment of $21.9 million of outstanding debt.

During the fourth quarter of 2019, the Company’s Board of Directors made the decision to sell four Ultramax vessels and as such these vessels were classified as held for sale at December 31, 2019. The Company recorded a loss of approximately $25.2 million in the fourth quarter of 2019 and expects to write-off deferred financing costs of approximately $0.8 million upon closing of the sale and repaying the outstanding debt.

Full report

Scorpio Bulkers Inc. press release