Seaspan Reports Fourth Quarter and Full Year 2018 Results
Achieves record annual Revenue, Operating Earnings and Cash Flow from Operations,
Closes the Second Fairfax Investment of $500 million, and
Takes steps to increase the number of unencumbered vessels to 32
HONG KONG, March 5, 2019 /PRNewswire/ - Seaspan Corporation ("Seaspan") (NYSE: SSW) announced today its financial results for the quarter and year ended December 31, 2018.
Highlights for the Fourth Quarter & Full Year 2018 & Year-to-Date 2019:
-- Earnings per diluted share of $0.25 for the fourth quarter and $1.31 for
the full year
-- Record quarterly and annual operating earnings of $134.4 million for the
fourth quarter and $469.9 million for the full year
-- Record quarterly and annual cash flows from operations of $149.3 million
for the fourth quarter and $483.9 million for the full year
-- Achieved vessel utilization of 97.3% for the fourth quarter and 97.8%
for the full year
-- Executed plan to increase the pool of unencumbered assets from 18 to 32
vessels (eight of which are in the process of being unencumbered)
through prepayment of two credit facilities, including one credit
facility prepaid subsequent to quarter end
-- Agreed to install scrubbers on ten large vessels with two leading
charterers; Seaspan will be compensated i) as costs are incurred on five
vessels and ii) through an increase in charter rates on the other five
vessels
Comments from Management
Bing Chen, President and Chief Executive Officer of Seaspan, commented, "2018 has been a year of transformation for Seaspan. We started out the year with our largest acquisition to date - GCI - which was seamlessly integrated into Seaspan, and helped us grow 2018 revenue by 32% over the prior year. With continued commitment from our founding shareholders, the Washington Family, we have added Fairfax Financial Holdings as a strategic financial partner. As of January 2019, Fairfax has invested $1 billion into Seaspan, and in the process became our largest shareholder. Throughout 2018, we worked relentlessly to strengthen our trademark operational excellence; in fact, this year marked our safest year on record, as measured by lost time injury frequency. Finally, we established a new leadership team during the year which, in partnership with the board of directors, has done an outstanding job of guiding the organization to achieve our targets. This remarkable year would not have been possible without each of our 4,600+ employees, and the partnership of our customers. Together, we have set the stage for a prosperous future for Seaspan."
Ryan Courson, Chief Financial Officer, added, "Throughout 2018 and into 2019, we have made significant progress in strengthening our balance sheet. Since the beginning of 2018, we have raised approximately $1.5 billion of capital, and in the process have substantially increased our equity capital base and improved our flexibility via our growing unencumbered fleet and committed corporate revolving credit facility. We will continue to augment our financial strength, while focusing on thoughtful capital allocation to position the business for long-term value creation."
Significant Developments in the Fourth Quarter
Debt Repayment
In November 2018, Seaspan made a repayment of $36.5 million for the remaining principal balance of one of its secured credit facilities; as a result, six vessels were unencumbered subsequent to year-end.
Senior Unsecured Notes
In December 2018, Seaspan repurchased approximately $17.5 million aggregate principal amount of its 6.375% senior unsecured notes due 2019.
Investment in Swiber Holdings Limited
On October 3, 2018, Seaspan entered into a binding term sheet to invest up to $200.0 million in Swiber Holdings Limited ("Swiber"). Subject to the terms and conditions to be set forth in a definitive transaction agreement, upon closing, Seaspan anticipates acquiring an 80% post-restructured equity interest in Swiber for $20.0 million and, after meeting certain milestones, an additional $180.0 million would be invested in Swiber's LNG-to-power project in Vietnam.
Recent Additions to Senior Management
In October 2018, Seaspan appointed Torsten Holst Pedersen as Executive Vice-President, Ship Management.
Subsequent Events
Registration of Washington Family Class A Common Shares
On January 14, 2019, Seaspan entered into a registration rights agreement (the "Washington Registration Rights Agreement") with various affiliates of the Washington family (the "Washington Shareholders"). Pursuant to the Washington Registration Rights Agreement, Seaspan agreed to file a registration statement covering the resale of the Washington Shareholders' Class A Common Shares, and a registration statement on Form F-3 was filed with the U.S. Securities and Exchange Commission (the "SEC") on January 18, 2019. For additional information regarding the Washington Registration Rights Agreement, please read our Report on Form 6-K furnished to the SEC on January 15, 2019.
"The share registration noted was simply an administrative task. The Washington family is not selling any of its shares, and it remains one of the largest shareholders of Seaspan Corporation. I will continue to serve on Seaspan's Board of Directors and remain committed to the long-term strategy of the Company," said Larry Simkins, a member of the Board of Directors of Seaspan and President of The Washington Companies.
Closing of Second Fairfax Investment of $500 million
On January 15, 2019, Seaspan closed its previously announced transaction (the "Second Fairfax Investment") with Fairfax Financial Holdings Limited ("Fairfax"), whereby Seaspan received proceeds of $500 million in exchange for $250 million aggregate principal amount of 5.50% Senior Notes due 2026 (the "2026 Notes"), and 38.5 million Class A Common Shares, which were issued in exchange for Fairfax's immediate exercise of warrants (the "2019 Warrants"). The aggregate purchase price of the 2026 Notes and the 2019 Warrants was $250 million and the proceeds from exercise of the 2019 Warrants was an additional $250 million.
Summary of Fairfax Investments((1))
Investment
Date Issued/Exercised Gross Proceeds to Seaspan
---
2025 Notes
February 14, 2018
$250 million
2018 Warrants
July 16, 2018
$250 million
2026 Notes
January 15, 2019
$250 million
2019 Warrants
January 15, 2019
$250 million
---
(1) Does not include the 25 million
seven year warrants
outstanding as of the date
hereof
Debt Repayment
On January 16, 2019, Seaspan made a repayment of $147.0 million for the remaining principal balance on a secured credit facility. As a result of the repayment, eight vessels will be unencumbered, subject to the completion of the associated collateral release documentation. As of March 5, 2019, Seaspan has 32 unencumbered vessels (with collateral in the process of being released with respect to eight of these).
Distribution
The Board of Directors declared a quarterly distribution in the amount of $0.125 per share for its Class A Common Shares, paid on January 30, 2019 to shareholders of record as at the close of business on January 14, 2019. Regular quarterly dividends on the Preferred Shares Series D, Series E, Series G, Series H and Series I were also declared.
Class A Common Shares Outstanding
As of February 28, 2019, there were 215,474,629 Class A Common Shares outstanding.
Results for the Quarter and Year Ended December 31, 2018
Financial Results
The following table summarizes Seaspan's consolidated financial results for the quarter ended and year ended December 31, 2018 and 2017:
Financial Summary
(in millions of US
dollars, except Quarter Ended Year Ended
December 31, December 31,
earnings per share
amount)
2018 2017 2018 2017
Revenue $
294.9 $
214.4 $
1,096.3 $
831.3
Ship operating
expense 55.6 48.1 219.3 183.9
Depreciation and
amortization
expense 64.7 50.4 245.8 199.9
General and
administrative
expense 7.1 11.1 31.6 40.1
Operating lease
expense 33.2 30.6 129.7 115.5
Operating earnings 134.4 80.6 469.9 303.1
Interest expense and
amortization of
deferred 57.6 31.3 212.1 116.4
financing fees
Net earnings 63.1 58.6 278.8 175.2
Net earnings to
common shareholders 44.9 42.4 207.6 110.8
Earnings per share,
diluted 0.25 0.34 1.31 0.94
Cash from operating
activities 149.3 89.0 483.9 323.2
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 1,939 days and 5,257 days for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. These increases were primarily due to the addition of 16 vessels acquired through the acquisition of Greater China Intermodal Investments LLC ("GCI"), which contributed 1,472 days and 4,688 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 year ended December 31, 2018 and 2017:
2017 2018 Year Ended
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018
Vessel Utilization:
Ownership Days(1) 7,917 8,037 8,148 7,905 8,030 9,546 9,844 9,844 32,007 37,264
Less Off-hire Days:
Scheduled 5-Year (104) (8) (22) (134)
Survey
Unscheduled Off- (662) (149) (137) (146) (240) (1,377)
(142) (254) (319) (672)
hire(2)
Operating Days(1) 7,255 7,895 7,894 7,586 7,777 9,409 9,690 9,582 30,630 36,458
Vessel Utilization 91.6 98.2 96.9 96.0 96.8 98.6 98.4 97.3 95.7 97.8
% % % % % % % % % %
(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 quarter and year ended December 31, 2018, compared to the same periods in 2017. The increases in utilization were primarily due to a large decrease in the number of unscheduled off-hire days in combination with the higher utilization of vessels acquired from GCI. During the year ended December 31, 2018, Seaspan completed dry-dockings for seven 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 37.6% to $294.9 million and by 31.9% to $1,096.3 million for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. The increases in revenue were primarily due to the additional operating days from the acquisition of vessels from the GCI transaction, 2018 vessel deliveries 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 quarter and year ended December 31, 2018, relative to the same periods in 2017, is attributable to the following:
Quarter Ended
Year Ended
December 31, 2018
December 31, 2018
Ownership Operating
$ Impact Ownership Operating
$ Impact
Days Days
Impact Days Impact (in millions Impact Days Impact (in millions
of US
of US dollars)
dollars)
Addition of 16 vessels from acquisition of GCI 1,472 1,472 $
54.3 4,688 4,688 $
169.9
2018 vessel deliveries and acquisitions 552 552 12.2 1,551 1,551 31.7
Changes in daily charter hire rates and re-charters 11.7 31.0
Full period contribution for 2017 vessel deliveries 152 152 6.9
Unscheduled off-hire 79 1.4 705 8.1
Scheduled off-hire (22) (0.2) (134) (2.1)
Vessel disposals (85) (85) (0.6) (1,134) (1,134) (3.9)
Interest income from leasing 3.3 28.9
Other (1.6) (5.5)
Total 1,939 1,996 $
80.5 5,257 5,828 $
265.0
Ship Operating Expense
Ship operating expense increased by 15.6% to $55.6 million and by 19.2% to $219.3 million for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in ownership days from the acquisition of vessels from the GCI transaction and 2018 vessel deliveries as well as higher bulk purchasing of vessel stores and spare parts. The increase in ship operating expense for the year ended December 31, 2018 was also due to the increase in planned maintenance required for certain vessels less than 8500 TEU in size.
2017 2018 Year Ended
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018
Operating Cost:
Ownership Days(1) 7,917 8,037 8,148 7,905 8,030 9,546 9,844 9,844 32,007 37,264
Vessel Operating Costs $
45.6 $
44.8 $
45.4 $
48.1 $
49.5 $
58.8 $
55.4 $
55.6 $
183.9 $
219.3
(in millions of US dollars)
Operating Cost per Ownership Day $
5,761 $
5,577 $
5,569 $
6,086 $
6,170 $
6,156 $
5,624 $
5,648 $
5,746 $
5,884
__________________________
(1) Ownership days include leased vessels and exclude vessels
under bareboat charter.
Depreciation and Amortization Expense
Depreciation and amortization expense increased by 28.5% to $64.7 million and by 22.9% to $245.8 million for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in ownership days from the acquisition of vessels from the GCI transaction and 2018 vessel deliveries.
General and Administrative Expense
General and administrative expense decreased by 36.2%, to $7.1 million and by 21.3% to $31.6 million for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. For the quarter ended December 31, 2018, the decrease was primarily due to share-based compensation expense relating to the accelerated vesting of restricted shares and cancellation of performance share units in 2017. For the year ended December 31, 2018, the decrease was 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 2018.
Operating Lease Expense
Operating lease expense increased by 8.6% to $33.2 million and by 12.3% to $129.7 million for the quarter and year ended December 31, 2018, respectively, compared to the same periods in 2017. The increases were primarily due to an increase in LIBOR.
Interest Expense and Amortization of Deferred Financing Fees
The following table summarizes Seaspan's borrowings:
(in
millions
of US
dollars) As at December 31,
2018 2017
Long-
term
debt,
excluding
deferred
financing
fees:
Revolving
credit
facilities $
788.2 $
854.1
Term loan
credit
facilities 2,158.7 1,196.0
Senior
unsecured
notes 400.4 418.0
2025
Notes 250.0
Discount
and fair
value
adjustment (85.7)
Long-
term
obligations
under
capital
lease,
excluding 647.7 648.8
deferred
financing
fees
Total
borrowings 4,159.3 3,116.9
Less:
Vessels
under
construction (146.4)
Operating
borrowings $
4,159.3 $
2,970.5
Interest expense and amortization of deferred financing fees increased by $26.3 million to $57.6 million and by $95.7 million to $212.1 million for the quarter and year ended December 31, 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 loss of $14.3 million for the quarter ended and a gain of $15.5 million year ended December 31, 2018, respectively. The loss for the quarter ended December 31, 2018 was primarily due to a decrease in the forward LIBOR curve as it relates to the interest rate swaps during the period. The gain for the year ended December 31, 2018 was primarily due to an increase in the forward LIBOR curve as it relates to interest rate swaps during the period. Included in the change in fair value is the unrealized change in fair value of $5.4 million loss and $57.4 million gain for the quarter and year ended December 31, 2018, respectively, compared to a gain of $19.4 million and $44.1 million for the comparative periods in the prior year.
Liquidity and Unencumbered Vessels((1))
As of December 31, 2018, Seaspan had total liquidity of $507.3 million, consisting of $357.3 million of cash and cash equivalents and $150.0 million available under our committed two year revolving credit facility. Additionally, as of March 5, 2019, Seaspan's unencumbered asset pool included 32 vessels (eight of which are in the process of being unencumbered).
TEU Class Vessel Count
---
2500 10
3500 2
4250 14
8500 2
9600 2
10000 2
---
Total 32
===
____________
(1) Includes vessels securing debt which
was repaid in January 2019, pending
completion of collateral release
documentation.
Working Capital
At December 31, 2018, Seaspan had a working capital deficiency of $475.6 million, which includes $320.4 million of senior unsecured notes maturing in April 2019. This deficiency is addressed by the closing of the Second Fairfax Investment on January 15, 2019 in which Seaspan received gross proceeds of $500.0 million.
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 four 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 fourth quarter and full year results on March 6, 2019 at 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: 4980867).
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS)
December 31, 2018 December 31, 2017
Assets
Current assets:
Cash and cash equivalents $
357,327 $
253,176
Short-term investments 2,532 104
Accounts receivable 13,001 11,678
Loans to affiliate 36,100
Prepaid expenses and other 36,519 44,869
Gross investment in lease 44,348 35,478
Fair value of financial instruments 113
453,840 381,405
Vessels 5,926,274 4,390,854
Vessels under construction 146,362
Gross investment in lease 817,631 687,896
Goodwill 75,321 75,321
Other assets 204,931 196,304
$
7,477,997 $
5,878,142
Liabilities, Puttable Preferred Shares and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $
70,211 $
63,220
Current portion of deferred revenue 55,915 55,367
Current portion of long-term debt 722,641 257,800
Current portion of long-term obligations under capital lease 48,384 43,912
Current portion of other long-term liabilities 32,243 23,635
929,394 443,934
Deferred revenue 376,884 328,681
Long-term debt 2,764,900 2,192,833
Long-term obligations under capital lease 591,372 595,016
Other long-term liabilities 180,157 199,386
Fair value of financial instruments 127,172 168,860
4,969,879 3,928,710
Puttable preferred shares 48,139
Shareholders' equity:
Share capital 2,102 1,646
Treasury shares (371) (377)
Additional paid in capital 3,126,457 2,752,988
Deficit (645,638) (781,137)
Accumulated other comprehensive loss (22,571) (23,688)
2,459,979 1,949,432
$
7,477,997 $
5,878,142
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
FOR THE QUARTER AND YEAR ENDED DECEMBER 31, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS, EXCEPT SHARE AND PER SHARE AMOUNTS)
Quarter Ended Year Ended
December 31, December 31,
2018 2017 2018 2017
Revenue $
294,912 $
214,381 $
1,096,331 $
831,324
Operating expenses:
Ship operating 55,594 48,108 219,270 183,916
Cost of services, supervision fees 650 1,300
Depreciation and amortization 64,716 50,359 245,801 199,938
General and administrative 7,071 11,082 31,565 40,091
Operating leases 33,176 30,554 129,747 115,544
Expenses related to customer
bankruptcy 1,013
Gain on disposals (6,998) (13,604)
160,557 133,755 626,383 528,198
Operating earnings 134,355 80,626 469,948 303,126
Other expenses (income):
Interest expense and amortization
of deferred 57,587 31,328 212,065 116,389
financing fees
Interest income (1,304) (1,113) (4,197) (4,558)
Acquisition related gain on
contract settlement (2,430)
Change in fair value of financial
instruments 14,285 (6,840) (15,490) 12,631
Equity income on investment (1,796) (1,216) (5,835)
Other expenses 690 494 2,418 9,262
71,258 22,073 191,150 127,889
Net earnings $
63,097 $
58,553 $
278,798 $
175,237
Dividends -preferred shares (18,163) (16,163) (71,229) (64,476)
Net earnings attributable to
common shares $
44,934 $
42,390 $
207,569 $
110,761
Weighted average number of shares,
basic 177,269 127,385 154,848 117,524
Effect of dilutive securities:
Share-based compensation 132 127 91 81
Fairfax warrants 937 3,129
Weighted average number of shares,
diluted 178,338 127,512 158,068 117,605
Earnings per share, basic $
0.25 $
0.34 $
1.34 $
0.94
Earnings per share, diluted $
0.25 $
0.34 $
1.31 $
0.94
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE QUARTER AND YEAR ENDED DECEMBER 31, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS)
Quarter Ended Year Ended
December 31, December 31,
2018 2017 2018 2017
Net earnings $
63,097 $
58,553 $
278,798 $
175,237
Other comprehensive income:
Amounts reclassified to net
earnings during the period 270 380 1,117 2,859
relating to cash flow
hedging instruments
Comprehensive income $
63,367 $
58,933 $
279,915 $
178,096
SEASPAN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE QUARTER AND YEAR ENDED DECEMBER 31, 2018 AND 2017
(IN THOUSANDS OF US DOLLARS)
Quarter Ended
Year Ended
December 31,
December 31,
2018 2017 2018 2017
Cash from (used in):
Operating activities:
Net earnings $
63,097 $
58,553 $
278,798 $
175,237
Items not involving cash:
Depreciation and amortization 64,716 50,359 245,801 199,938
Share-based compensation 1,229 5,149 3,134 17,526
Amortization of deferred financing fees, debt discount 5,664 3,081 19,947 11,899
and fair value of long-term debt
Amounts reclassified from other comprehensive 79 103 333 1,927
loss to interest expense
Unrealized change in fair value of financial instruments 5,389 (19,392) (57,445) (44,060)
Acquisition related gain on contract settlement (2,430)
Equity income on investment (1,796) (1,216) (5,835)
Amortization of acquired revenue contracts 2,656 1,329 8,117 4,511
Operating leases (5,902) (5,911) (23,594) (22,589)
Gain on disposals (6,998) (13,604)
Other 4 116 16 6,690
Changes in assets and liabilities 12,416 4,358 12,390 (8,421)
Cash from operating activities 149,348 88,951 483,851 323,219
Financing activities:
Common shares issued, net of issuance costs 39,598 118,966
Preferred shares issued, net of issuance costs (40) 2,690 144,375 2,690
Draws on credit facilities 325,600
Repayment of credit facilities (109,002) (185,553) (469,662) (455,005)
2025 Notes and 2018 Warrants issued 250,000
Senior unsecured notes issued 80,000 80,000
Draws on long-term obligations under capital lease 39,923 46,964 176,254
Repayment of long-term obligations under (12,468) (6,706) (48,140) (26,198)
capital lease
Common shares repurchased, including
related expenses
Senior unsecured notes repurchased, including (17,529) (3,953) (17,529) (7,075)
related expenses
Proceeds from exercise of 2018 Warrants 250,000
Redemption of Series F preferred shares (143,430)
Financing fees (254) (5,054) (16,122) (8,226)
Dividends on common shares (21,580) (8,419) (49,937) (61,830)
Dividends on preferred shares (16,085) (16,103) (65,765) (64,416)
Net proceeds from sale-leaseback of vessels 90,753
Cash from (used in) financing activities (176,958) (63,577) 206,354 (154,087)
Investing activities:
Expenditures for vessels (2,562) (102,793) (318,740) (338,518)
Short-term investments (27) (2,428) 307
Net proceeds from vessel disposals 18,753 37,091
Loans to affiliate 427 (546) (2,677)
Repayment of loans to affiliate 546 22,325
Other assets (3,927) (2,488) (1,417) (2,384)
Acquisition of GCI (333,581)
Cash acquired from GCI acquisition 70,121
Cash used in investing activities (6,089) (86,528) (586,045) (283,856)
Increase (decrease) in cash, cash equivalents and restricted cash (33,699) (61,154) 104,160 (114,724)
Cash, cash equivalents and restricted cash, beginning of period 405,095 328,390 267,236 381,960
Cash, cash equivalents and restricted cash, end of period $
371,396 $
267,236 $
371,396 $
267,236
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:
December 31,
2018 2017
Cash and cash equivalents $
357,327 $
253,176
Restricted cash included in other assets 14,069 14,060
Total cash, cash equivalents and restricted cash shown in the $
371,396 $
267,236
consolidated statements of cash flows
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;
-- 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;
-- the value of Seaspan's vessels and other factors or events that trigger
impairment assessments or results;
-- 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 Islands, 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 Seaspan's 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
Seaspan Corporation
Tel. +1-778-328-5340
Email: mborys@seaspanltd.ca
View original content to download multimedia:http://www.prnewswire.com/news-releases/seaspan-reports-fourth-quarter-and-full-year-2018-results-300807269.html
SOURCE Seaspan Corporation
