Seaspan Reports Third Quarter 2018 Results
Achieves record quarterly Revenue, Operating Earnings and Cash Flow from Operations
Repays $225 million of secured debt, part of which will unencumber 6 additional vessels, and
Closes $150 million corporate revolving credit facility bringing total liquidity to $541 million
HONG KONG, Oct. 30, 2018 /PRNewswire/ - Seaspan Corporation ("Seaspan") (NYSE: SSW) announced today its financial results for the three and nine months ended September 30, 2018.
Highlights for the Quarter:
-- Earnings per diluted share of $0.36 for the third quarter and $1.07 for
the nine months
-- Cash Flow from Operations reached a quarterly record $142.2 million for
the third quarter and $325.0 million for the nine months
-- Fairfax exercised its first tranche of 38.5 million warrants for
proceeds to Seaspan of $250.0 million
-- Closed $150.0 million, two-year, corporate revolving credit facility
-- Redeemed 10.5% Series F Preferred Shares for an aggregate total of
$143.4 million, including accrued dividends
-- Issued 8.0% Fixed-to-Floating Rate Series I Preferred Shares for gross
proceeds of $150.0 million
-- Achieved vessel utilization of 98.4% for the third quarter and 98.0% for
the nine months ended September 30, 2018
-- Entered into a binding term sheet for a potential investment of up to
$200.0 million in the restructuring of Swiber Holdings Limited
Bing Chen, President and Chief Executive Officer of Seaspan, commented, "I am pleased with our record operating results in the third quarter, and the strategic milestones we have achieved so far this year. We are realizing benefits from the full integration of GCI, which is the main driver of our year-over-year growth, while we continue to invest in and improve operations of our integrated containership platform to provide best-in-class services. These improvements are evidenced by our 98.4% utilization rate for the quarter, as well as marking the lowest ever number of lost time injuries since we began tracking in 2013."
Ryan Courson, Chief Financial Officer, added, "Over the course of the third quarter, we have improved our liquidity position with several strategic financings including closing the first of Fairfax's two $250 million equity investments, a $150 million two-year corporate revolving credit facility, and $150 million of Preferred Series I Shares. Through prudent capital allocation we have lowered our cost of capital while increasing our capital structure flexibility."
Significant Developments
Fairfax Investments
On July 16, 2018, in accordance with the May 2018 definitive agreement, Seaspan issued warrants to Fairfax Financial Holdings Ltd. and its affiliates ("Fairfax") to purchase 25.0 million Class A common shares at an exercise price of $8.05 per share. In exchange for this, Fairfax exercised its first tranche of 38.5 million warrants at an exercise price of $6.50 per share in July 2018, for total proceeds of $250.0 million. Additionally, Fairfax agreed to exercise its second tranche of 38.5 million warrants at an exercise price of $6.50 per share, upon issuance of the warrants in January 2019 on closing of the March 2018 definitive agreement, for proceeds to the Company of $250.0 million. The two tranches of debentures, the first $250.0 million issued in February 2018, and the second $250.0 million to be issued in January 2019, were amended to allow Fairfax to call for early redemption of some or all of the debentures on each anniversary date of issuance. As the right to put the debentures is solely within the control of Fairfax, the February 2018 debentures were reclassified from long-term liabilities to current liabilities as of July 16, 2018. In September 2018, Fairfax waived the annual put right of the February 2018 debentures, which caused the February 2018 debentures to be reclassified from current liabilities to long-term liabilities. The February 2018 debentures will be reclassified from long-term liabilities to current liabilities when such debentures become puttable within one year from period end. Upon funding of the January 2019 debentures and exercise of the second tranche of warrants upon closing of the March 2018 definitive agreement in January 2019, the January 2019 debentures will be classified as a current liability, as the debentures will be puttable within one year.
Following the exercise by Fairfax of its first tranche of warrants on July 16, 2018 to purchase 38.5 million Class A common shares, and as of September 30, 2018, the Company had 176.7 million Class A common shares outstanding.
Subsequent Events
Swiber Investment
As previously announced, on October 3, 2018, Seaspan entered into a binding term sheet for a potential investment of up to $200.0 million in the restructured Swiber Holdings Limited. Seaspan expects the investment to be funded in two tranches: i) $20.0 million upon closing in exchange for an 80% economic interest in the restructured Swiber Group, and ii) an incremental $180.0 million to be invested in a $1.0 billion LNG-to-power project in Vietnam that is currently under development. Closing of the first tranche is expected to occur in 2019.
Distribution
The Board of Directors has declared a quarterly distribution in the amount of $0.125 per share for its Class A common shares, payable on October 30, 2018 to shareholders of record as at the close of business on October 22, 2018. The regular quarterly dividends on the Preferred Shares Series D, Series E, Series G, Series H and Series I have also been declared.
Results for the Three and Nine Months Ended September 30, 2018
Financial Results
The following table summarizes Seaspan's consolidated financial results for the three and nine months ended September 30, 2018 and 2017:
Financial Summary Three Months Ended Nine Months Ended
September 30,
(in millions of US
dollars) September 30,
2018 2017 2018 2017
Revenue $
295.0 $
211.0 $
801.4 $
616.9
Ship operating
expense 55.4 45.4 163.7 135.8
Depreciation and
amortization
expense 65.1 49.8 181.1 149.6
General and
administrative
expense 8.1 14.0 24.5 29.0
Operating lease
expense 33.0 30.3 96.6 85.0
Interest expense and
amortization of
deferred financing
fees 58.2 28.3 154.5 85.1
Net earnings 80.0 48.4 215.7 116.7
Earnings per share,
diluted 0.36 0.26 1.07 0.60
Cash from operating
activities 142.2 95.1 325.0 234.3
Ownership Days, Operating Days and Vessel Utilization
Ownership days are the number of days a vessel is owned and available for charter. Operating days are the number of days a vessel is available to the charterer for use.
The primary driver of ownership days are the increases or decreases in the number of vessels owned, while the drivers of operating days are ownership days and the number of days the vessels are off-hire.
Ownership days increased by 1,696 days and 3,318 days for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017, primarily due to the addition of 16 vessels acquired through the Greater China Intermodal Investments LLC ("GCI") acquisition, which contributed 1,472 days and 3,216 days, respectively. The remainder of the increase was due to 2018 vessel deliveries and acquisitions and partially offset by vessel disposals.
Vessel utilization represents the number of operating days as a percentage of ownership days.
The following table summarizes Seaspan's vessel utilization by quarter and for the nine months ended September 30, 2018 and 2017:
Three Months Ended Three Months Ended Three Months Ended Nine Months Ended
September 30,
March 31, June 30, September 30,
2018 2017 2018 2017 2018 2017 2018 2017
Vessel Utilization:
Ownership Days(1) 8,030 7,917 9,546 8,037 9,844 8,148 27,420 24,102
Less Off-hire Days:
Scheduled Off-hire (104) (8) (112)
Unscheduled Off-hire(2) (149) (662) (137) (142) (146) (254) (432) (1,058)
Operating Days(1) 7,777 7,255 9,409 7,895 9,690 7,894 26,876 23,044
Vessel Utilization 96.8 91.6 98.6 98.2 98.4 96.9 98.0 95.6
% % % % % % % %
_____________________________
(1) Operating and ownership days include leased vessels and exclude
vessels under bareboat charter.
(2) Unscheduled off-hire includes days related to vessels being off-
charter.
Vessel utilization increased for the three and nine months ended September 30, 2018, compared to the same periods in 2017, primarily due to higher utilization of vessels acquired from GCI, 2018 deliveries and acquisitions and a decrease in off-hire days. During the nine months ended September 30, 2018, Seaspan completed dry-dockings for five 2500 TEU vessels, one 3500 TEU vessel and one 4250 TEU vessel, one of which occurred while the vessel was off-charter.
Revenue
Revenue increased by 39.8% to $295.0 million and by 29.9% to $801.4 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The increases in revenue were primarily due to the additional operating days from the vessel deliveries, acquisition of new vessels from the GCI transaction and higher average charter rates for vessels that were on short-term charters.
The increase in operating days and the related financial impact thereof for the three and nine months ended September 30, 2018, relative to the same periods in 2017, is attributable to the following:
Three Months Ended
Nine Months Ended
September 30, September 30,
Ownership Operating
$ Impact Ownership Operating
$ Impact
Day Impact Day Impact
Days (in millions
Days (in millions
Impact Impact
of US
of US
dollars) dollars)
Addition of 16 vessels from acquisition of GCI 1,472 1,472 $
54.1 3,216 3,216 $
115.7
Changes in daily charter hire rates and re-charters 12.6 19.3
2018 vessel deliveries and acquisitions 552 552 12.2 999 998 19.5
Full period contribution for 2017 vessel deliveries 152 152 6.9
Unscheduled off-hire 108 0.5 626 6.7
Scheduled off-hire (8) (0.1) (112) (1.9)
Vessel disposals (328) (328) (1.3) (1,049) (1,048) (3.3)
Interest income from leasing 8.0 25.6
Other (2.0) (4.0)
Total 1,696 1,796 $
84.0 3,318 3,832 $
184.5
Ship Operating Expense
Ship operating expense increased by 22.0% to $55.4 million and by 20.5% to $163.7 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in ownership days from the increase in the number of vessels in Seaspan's fleet. The increase in ship operating expense for the nine months ended September 30, 2018 was also due to a higher bulk purchasing of vessel stores and spare parts, and an increase in planned maintenance required for certain vessels less than 8500 TEU in size.
Depreciation and Amortization Expense
Depreciation and amortization expense increased by 30.5% to $65.1 million and by 21.1% to $181.1 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in ownership days from the increase in the number of vessels in Seaspan's fleet.
General and Administrative Expense
General and administrative expense decreased by 41.9%, to $8.1 million and by 15.6% to $24.5 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The decreases were primarily due to share-based compensation expense to the chairman of the board and the former chief executive officer, partially offset by a transition payment to the former chief financial officer in the second quarter of 2018.
Operating Lease Expense
Operating lease expense increased by 9.0% to $33.0 million and by 13.6% to $96.6 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in LIBOR. The increase to the nine months ended September 30, 2018 was also due to the delivery of one vessel in 2017 that was financed through a sale-leaseback transaction.
Interest Expense and Amortization of Deferred Financing Fees
The following table summarizes Seaspan's borrowings:
(in millions of US dollars) September 30,
2018 2017
Long-term debt, excluding deferred financing fees:
Revolving credit facilities $
812.3 $
876.9
Term loan credit facilities 2,243.8 1,358.8
Senior unsecured notes 417.9 341.9
Senior notes due 2025 250.0
Discount and fair value adjustment (88.1)
Long-term obligations under capital lease, excluding deferred financing fees 660.1 615.6
Total borrowings 4,296.0 3,193.2
Less: Vessels under construction (136.6)
Operating borrowings $
4,296.0 $
3,056.6
Interest expense and amortization of deferred financing fees increased by $29.9 million to $58.2 million and by $69.4 million to $154.5 million for the three and nine months ended September 30, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to the debt assumed as part of the acquisition of GCI, an increase in operating debt for delivered vessels, the issuance of the February 2018 debentures to Fairfax and an increase in LIBOR.
Change in Fair Value of Financial Instruments
The change in fair value of financial instruments resulted in a gain of $4.5 million and $29.8 million for the three and nine months ended September 30, 2018, respectively. The gains for these periods were primarily due to an increase in the forward LIBOR curve as it relates to interest swaps. Included in the gain is unrealized change in fair value of $13.9 million and $62.8 million for the three and nine months ended September 30, 2018, respectively, compared to $11.5 million and $24.7 million for the comparative periods in the prior year.
Working Capital
At September 30, 2018 Seaspan had a working capital deficiency of $465.5 million which includes $337.9 million of senior unsecured notes maturing in April 2019. In order to alleviate this deficiency Seaspan will rely, in part, upon the funding of the $250.0 million January 2019 Fairfax debentures and concurrent exercise of the second tranche of 38.5 million warrants in January 2019 for proceeds of $250.0 million, both of which are subject to limited closing conditions, including that there has not been a material adverse change with respect to Seaspan. In the event that these closing conditions are not satisfied, which Seaspan does not expect to occur, Seaspan's plans to alleviate this deficiency would include entering into secured financing for its 18 unencumbered vessels (six of which are in the process of being unencumbered), selling vessels, or drawing on its $150.0 million corporate revolver. Seaspan also expects to further address this deficiency through cash generated from operations, existing sources of funds and additional sources of funds in the capital markets to the extent available.
About Seaspan
Seaspan is the leading independent charter owner of containerships with industry leading ship management services. Seaspan charters its vessels primarily pursuant to long-term, fixed-rate, time charters from the world's largest container shipping liners. Seaspan's operating fleet consists of 112 containerships with a total capacity of more than 900,000 TEU, an average age of approximately six years and an average remaining lease period of approximately five years, on a TEU weighted basis.
Seaspan has the following securities listed on The New York Stock Exchange:
Symbol Description
---
SSW Class A common shares
SSW PR D Series D preferred shares
SSW PR E Series E preferred shares
SSW PR G Series G preferred shares
SSW PR H Series H preferred shares
SSW PR I Series I preferred shares
SSWN 6.375% senior unsecured notes
due 2019
SSWA 7.125% senior unsecured notes
due 2027
SSW25 5.500% senior notes due 2025
Conference Call and Webcast
Seaspan will host a conference call and webcast presentation for investors, analysts, and interested parties to discuss its third quarter results on October 31, 2018 at 5:30 a.m. PT / 8:30 a.m. ET. Participants should call 1-877-246-9875 (US/Canada) or 1-707-287-9353 (International) and request the Seaspan call. The live webcast and slide presentation are available under "Events & Presentations" at www.seaspancorp.com.
A recording will be available at 1-855-859-2056 or 1-404-537-3406 (Conference passcode: 8095029).
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2018
(IN THOUSANDS OF US DOLLARS)
September 30, December 31,
2018 2017
Assets
Current assets:
Cash and cash equivalents $
391,030 $
253,176
Short-term investments 2,505 104
Accounts receivable 7,714 11,678
Loans to affiliate 36,100
Prepaid expenses and other 42,208 44,869
Fair value of financial instruments 187
Gross investment in lease 44,348 35,478
487,992 381,405
Vessels 5,982,857 4,390,854
Vessels under construction 146,362
Deferred charges 56,120 62,020
Gross investment in lease 828,809 687,896
Goodwill 75,321 75,321
Other assets 161,155 134,284
$
7,592,254 $
5,878,142
Liabilities, puttable preferred shares and shareholders' equity
Current liabilities:
Accounts payable and accrued liabilities $
70,568 $
63,220
Current portion of deferred revenue 52,094 55,367
Current portion of long-term debt 745,540 257,800
Current portion of long-term obligations under capital lease 47,996 43,912
Current portion of other long-term liabilities 37,292 23,635
953,490 443,934
Deferred revenue 385,315 328,681
Long-term debt 2,864,158 2,192,833
Long-term obligations under capital lease 603,734 595,016
Other long-term liabilities 182,391 199,386
Fair value of financial instruments 121,858 168,860
5,110,946 3,928,710
Puttable preferred shares 47,695
Shareholders' equity:
Share capital 2,100 1,646
Treasury shares (371) (377)
Additional paid in capital 3,124,759 2,752,988
Deficit (670,034) (781,137)
Accumulated other comprehensive loss (22,841) (23,688)
2,433,613 1,949,432
$
7,592,254 $
5,878,142
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS, EXCEPT SHARE AND PER SHARE AMOUNTS)
Three Months Ended Nine Months Ended
September 30, September 30,
---
2018 2017 2018 2017
---
Revenue $
294,981 $
211,013 $
801,419 $
616,943
Operating expenses:
Ship operating 55,360 45,378 163,676 135,808
Cost of services, supervision fees 650 650
Depreciation and amortization 65,053 49,835 181,085 149,579
General and administrative 8,148 14,034 24,494 29,009
Operating leases 33,048 30,332 96,571 84,990
Expenses related to customer bankruptcy 1,013
Gain on disposals (6,606) (6,606)
161,609 133,623 465,826 394,443
Operating earnings 133,372 77,390 335,593 222,500
Other expenses (income):
Interest expense and amortization of deferred financing fees 58,231 28,332 154,478 85,061
Interest income (1,128) (1,080) (2,893) (3,445)
Undrawn credit facility fees 64 584 359 1,849
Acquisition related gain on contract settlement (2,430) -
Change in fair value of financial instruments (4,526) 2,444 (29,775) 19,471
Equity income on investment (1,510) (1,216) (4,039)
Other expenses 758 243 1,369 6,919
53,399 29,013 119,892 105,816
Net earnings $
79,973 $
48,377 $
215,701 $
116,684
Deficit, beginning of period (749,752) (825,359) (781,137) (807,496)
Dividends - common shares (14,744) (50,658) (68,137)
Dividends - preferred shares 245 (16,104) (52,627) (48,313)
Other (500) (140) (1,313) (708)
Deficit, end of period $
(670,034) $
(807,970) $
(670,034) $
(807,970)
===
Weighted average number of shares, basic 170,232 121,752 147,292 114,201
Weighted average number of shares, diluted 174,030 121,831 151,533 114,260
Earnings per share, basic $
0.37 $
0.27 $
1.10 $
0.60
===
Earnings per share, diluted $
0.36 $
0.26 $
1.07 $
0.60
===
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS)
Three Months Ended Nine Months Ended
September 30, September 30,
---
2018 2017 2018 2017
---
Net earnings $
79,973 $
48,377 $
215,701 $
116,684
Other comprehensive income:
Amounts reclassified to net
earnings during the period
relating to cash flow hedging
instruments 271 342 847 2,479
Comprehensive income $
80,244 $
48,719 $
216,548 $
119,163
===
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS)
Three Months Ended Nine Months Ended
September 30, September 30,
2018 2017 2018 2017
Cash from (used in):
Operating activities:
Net earnings $
79,973 $
48,377 $
215,701 $
116,684
Items not involving cash:
Depreciation and amortization 65,053 49,835 181,085 149,579
Share-based compensation 355 8,507 1,905 12,377
Amortization of deferred financing fees, debt discount and fair value of long term debt 5,726 2,605 14,283 8,818
Amounts reclassified from other comprehensive loss to interest expense 80 144 254 1,824
Unrealized change in fair value of financial instruments (13,925) (11,483) (62,834) (24,668)
Acquisition related gain on contract settlement (2,430) -
Equity income on investment (1,510) (1,216) (4,039)
Operating leases (5,883) (5,911) (17,692) (16,678)
Amortization of revenue contracts 1,902 1,133 5,461 3,182
Gain on disposals (6,606) (6,606)
Other 1 107 12 6,574
Changes in assets and liabilities 8,917 9,853 (9,578) (12,779)
Cash from operating activities 142,199 95,051 324,951 234,268
Financing activities:
Common shares issued, net of issuance costs 22,102 79,368
Preferred shares issued, net of issuance costs 144,416 144,416 -
Repayment of credit facilities (225,916) (98,295) (360,660) (269,452)
Draws on credit facilities 325,600 -
Fairfax notes and warrants issued 250,000 -
Draws on long-term obligations under capital lease 136,331 46,964 136,331
Repayment of long-term obligations under capital lease (12,365) (6,619) (35,672) (19,492)
Senior unsecured notes repurchased, including related expenses (3,122)
Proceeds from exercise of Fairfax warrants 250,000 250,000 -
Redemption of Series F preferred shares (143,430) (143,430) -
Financing fees (2,753) (858) (15,868) (3,172)
Dividends on common shares (9,549) (7,701) (28,358) (53,411)
Dividends on preferred shares (14,720) (16,104) (49,680) (48,313)
Net proceeds from sale-leaseback of vessels 90,753
Cash from (used in) financing activities (14,317) 28,856 383,312 (90,510)
Investing activities:
Expenditures for vessels (5,613) (139,364) (306,626) (235,725)
Short-term investments (105) (1) (2,401) 307
Net proceeds from vessel disposal 18,338 18,338
Other assets (201) 60 2,510 104
Loans to affiliate (546) (427) (2,131)
Repayment of loans to affiliate 546 21,779
Acquisition of GCI (333,581) -
Cash acquired from GCI acquisition 70,121 -
Cash used in investing activities (5,919) (120,967) (570,404) (197,328)
Increase (decrease) in cash, cash equivalents and restricted cash 121,963 2,940 137,859 (53,570)
Cash, cash equivalents and restricted cash, beginning of period 283,132 325,450 267,236 381,960
Cash, cash equivalents and restricted cash, end of period $
405,095 $
328,390 $
405,095 $
328,390
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the amounts shown in the consolidated statements of cash flows:
September 30,
2018 2017
Cash and cash equivalents $
391,030 $
308,927
Restricted cash included in other assets 14,065 19,463
Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows $
405,095 $
328,390
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements (as such term is defined in Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act) concerning Seaspan's operations, cash flows, and financial position, including, in particular, the likelihood of its success in developing and expanding its business. Statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "continue," "expects," "anticipates," "intends," "plans," "believes," "estimates," "projects," "forecasts," "will," "may," "potential," "should" and similar expressions are forward?looking statements. These forward-looking statements represent Seaspan's estimates and assumptions only as of the date of this release and are not intended to give any assurance as to future results. As a result, you are cautioned not to rely on any forward-looking statements. Forward-looking statements appear in a number of places in this release. Although these statements are based upon assumptions Seaspan believes to be reasonable based upon available information, they are subject to risks and uncertainties. These risks and uncertainties include, but are not limited to:
-- future growth prospects and ability to expand Seaspan's business;
-- Seaspan's expectations as to impairments of its vessels, including the
timing and amount of currently anticipated impairments;
-- the future valuation of Seaspan's vessels and goodwill;
-- potential acquisitions, vessel financing arrangements and other
investments, and Seaspan's expected risks and benefits from such
transactions;
-- future time charters and vessel deliveries, including future long-term
charters for certain existing vessels;
-- estimated future capital expenditures needed to preserve the operating
capacity of Seaspan's fleet including, its capital base, and comply with
regulatory standards, its expectations regarding future dry-docking and
operating expenses, including ship operating expense and general and
administrative expenses;
-- Seaspan's expectations about the availability of vessels to purchase,
the time it may take to construct new vessels, the delivery dates of new
vessels, the commencement of service of new vessels under long-term time
charter contracts and the useful lives of its vessels;
-- availability of crew, number of off-hire days and dry-docking
requirements;
-- general market conditions and shipping market trends, including charter
rates, increased technological innovation in competing vessels and other
factors affecting supply and demand;
-- Seaspan's financial condition and liquidity, including its ability to
borrow and repay funds under its credit facilities, to refinance its
existing facilities and to obtain additional financing in the future to
fund capital expenditures, acquisitions and other general corporate
activities;
-- Seaspan's continued ability to meet its current liabilities as they
become due;
-- Seaspan's continued ability to maintain, enter into or renew primarily
long-term, fixed-rate time charters with its existing customers or new
customers;
-- the potential for early termination of long-term contracts and Seaspan's
potential inability to enter into, renew or replace long-term contracts;
-- the introduction of new accounting rules for leasing and exposure to
currency exchange rates and interest rate fluctuations;
-- conditions inherent in the operation of ocean-going vessels, including
acts of piracy;
-- acts of terrorism or government requisition of Seaspan's containerships
during periods of war or emergency;
-- adequacy of Seaspan's insurance to cover losses that result from the
inherent operational risks of the shipping industry;
-- lack of diversity in Seaspan's operations and in the type of vessels in
its fleet;
-- conditions in the public equity market and the price of Seaspan's
shares;
-- Seaspan's ability to leverage to its advantage its relationships and
reputation in the containership industry;
-- compliance with and changes in governmental rules and regulations or
actions taken by regulatory authorities, and the effect of governmental
regulations on Seaspan's business;
-- the financial condition of Seaspan's customers, lenders, and other
counterparties and their ability to perform their obligations under
their agreements with us;
-- Seaspan's continued ability to meet specified restrictive covenants and
other conditions in its financing and lease arrangements, its notes and
its preferred shares;
-- any economic downturn in the global financial markets and export trade
and increase in trade protectionism and potential negative effects of
any recurrence of such disruptions on Seaspan's customers' ability to
charter Seaspan's vessels and pay for Seaspan's services;
-- some of Seaspan's directors and investors may have separate interests
which may conflict with those of its shareholders and they may be
difficult to replace given the anti-takeover provisions in Seaspan's
organizational documents;
-- taxation of Seaspan's earnings and of distributions to its shareholders;
-- Seaspan's exemption from tax on U.S. source international transportation
income;
-- the ability to bring claims in China and Marshall Island, where the
legal systems are not well-developed;
-- potential liability from future litigation; and
-- other factors detailed from time to time in Seaspan's periodic reports.
Forward-looking statements in this release are estimates and assumptions reflecting the judgment of senior management and involve known and unknown risks and uncertainties. These forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond Seaspan's control. Actual results may differ materially from those expressed or implied by such forward-looking statements. Accordingly, these forward-looking statements should be considered in light of various important factors listed above and including, but not limited to, those set forth in "Item 3. Key Information--D. Risk Factors" in Seaspan's Annual Report for the year ended December 31, 2017 on Form 20-F filed on March 6, 2018 and in the "Risk Factors" in Reports on Form 6-K that are filed with the Securities and Exchange Commission from time to time relating to its quarterly financial results.
Seaspan does not intend to revise any forward-looking statements in order to reflect any change in Seaspan's expectations or events or circumstances that may subsequently arise. Seaspan expressly disclaims any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in Seaspan's views or expectations, or otherwise. You should carefully review and consider the various disclosures included in this Annual Report and in Seaspan's other filings made with the Securities and Exchange Commission that attempt to advise interested parties of the risks and factors that may affect Seaspan's business, prospects and results of operations.
Investor Inquiries:
Mr. Matt Borys
Investor Relations
Seaspan Corporation
Tel. 604-347-9184
Email: mborys@seaspanltd.ca
View original content to download multimedia:http://www.prnewswire.com/news-releases/seaspan-reports-third-quarter-2018-results-300740824.html
SOURCE Seaspan Corporation
