Seaspan Reports Third Quarter 2019 Results
Achieves highest quarterly utilization rate since 2011 of 99.6%,
Closes $500 million accordion, increasing Portfolio Financing Program to $1.5 billion and finishes the quarter with over $912 million of liquidity
HONG KONG, Nov. 7, 2019 /PRNewswire/ - Seaspan Corporation ("Seaspan") (NYSE: SSW) announced today its financial results for the three and nine months ended September 30, 2019.
Highlights for the Third Quarter and First Nine Months of 2019:
-- Increased portfolio financing program by $500.0 million to $1.5 billion -- Agreed to acquire 9600 TEU vessel which Seaspan expects will enter into a three year time charter with Ocean Network Express ("ONE") -- Achieved vessel utilization of 99.6% for the third quarter, the highest quarterly utilization since 2011, and 98.8% for the first nine months -- Operating earnings of $116.1 million for the third quarter and $570.6 million for the first nine months -- Earnings per diluted share of $0.11 for the third quarter and $1.44 for the first nine months; changes in fair value of financial instruments contributed a loss of $0.10 per diluted share for the third quarter and a loss of $0.17 per diluted share for the first nine months -- Cash flow from operations of $145.9 million for the third quarter and $645.2 million for the first nine months
Comments from Management
Bing Chen, President and Chief Executive Officer, commented, "Our focus on Operational Excellence in quality, reliability, and scalability, together with Customer Partnership, as the preferred solution provider of our customers, has resulted in our highest quarterly utilization rate since 2011, of 99.6% for our 112 vessels fleet. We continue to strengthen our customer centric approach, which this quarter generated an attractive vessel acquisition to facilitate the growth needs of one of our customers, in addition to a tailored charter solution for another. We see growing opportunities to broaden and deepen our customer partnerships as our sector stabilizes into a new normal marked by consolidation, and we expect our momentum to continue throughout the remainder of the year."
Ryan Courson, Chief Financial Officer, said, "During the quarter we continued to execute across our business delivering, ahead of plan, a total of $645 million year-to-date cash flows from operations. We remain focused on the balance sheet as well, advancing our capital plan with the increase of our portfolio financing program to $1.5 billion of total commitments. The increased capacity provides room and flexibility to finance new acquisitions, including our recently acquired 9600 TEU vessel, which is expected to be delivered in April. The execution on our capital plan has significantly improved capital availability and flexibility, positioning us to execute on our next phase of growth."
Significant Developments During the Quarter Ended September 30, 2019
Portfolio Financing Program Increased to $1.5 billion
On May 15, 2019, Seaspan entered into a credit agreement with a syndicate of lenders for a $1.0 billion secured credit facility as part of a portfolio financing program (the "Program"). The Program is secured by a portfolio of vessels (the "Collateral Pool") and bears interest at LIBOR plus 2.25% per annum. Seaspan may add, substitute and remove vessels from the Collateral Pool during the term, subject to a borrowing base, portfolio concentration limits, absence of defaults and compliance with financial covenants and certain negative covenants.
On September 18, 2019, Seaspan increased the committed amount under the Program by $500.0 million to a total of $1.5 billion. The additional commitments are subject to the same terms, conditions and Collateral Pool security requirements as the initial tranche.
Series D Preferred Shares
In September 2019, Seaspan redeemed 1,923,585 shares of 7.95% Series D preferred shares for $47.8 million.
Purchase of 9600 TEU Vessel
On September 9, 2019, Seaspan closed an agreement to purchase a 2010-built 9600 TEU containership. The vessel is expected to be delivered by the end of April 2020, at which point Seaspan expects the vessel will enter into a 36 month fixed rate time charter with ONE. Subsequent to delivery of the vessel, Seaspan's fleet will expand to 113 vessels.
Unencumbered Vessels
As of November 7, 2019, Seaspan had 31 unencumbered vessels.
Subsequent Events
Debt Prepayment
In October 2019, Seaspan refinanced secured term loan facilities, totalling $180.1 million, using proceeds from the Program. As of September 30, 2019, this balance was classified as current liabilities due to the issuance of voluntary irrevocable prepayment notices by Seaspan.
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 October 30, 2019 to shareholders of record as at the close of business on October 21, 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 November 7, 2019, there were 215.7 million Class A Common Shares outstanding.
Results for the Three and Nine Months Ended September 30, 2019 and 2018
Financial Results
The following table summarizes Seaspan's consolidated financial results for the three and nine months ended September 30, 2019 and 2018:
Financial Summary Three Months Ended Nine Months Ended September 30, September 30, (in millions of US dollars, except earnings per share amount) 2019 2018 2019 2018 Revenue $ 282.7 $ 295.0 $ 843.5 $ 801.4 Ship operating expense 56.8 55.4 170.4 163.7 Depreciation and amortization expense 63.9 65.1 189.8 181.1 General and administrative expense 7.7 8.1 23.3 24.5 Operating lease expense 38.3 33.0 116.3 96.6 Income related to modification of time charters 227.0 Operating earnings 116.1 133.4 570.6 335.6 Interest expense and amortization of deferred financing fees 45.0 56.0 151.5 149.4 Net earnings 43.0 80.0 368.2 215.7 Net earnings to common shareholders 25.0 63.5 314.0 162.6 Earnings per share, diluted 0.11 0.36 1.44 1.07 Cash from operating activities 145.9 150.6 645.2 355.9
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 were unchanged for the three months ended September 30, 2019, and increased by 1,791 days for the nine months ended September 30, 2019, compared with the same periods in 2018. The increase for the nine months ended September 30, 2019 was primarily due to the full period contribution of the additional 16 vessels acquired through the acquisition of Greater China Intermodal Investments LLC ("GCI"), which contributed 1,152 days, with the remainder due to the 2018 vessel deliveries.Vessel utilization represents the number of operating days as a percentage of ownership days.
The following table summarizes Seaspan's vessel utilization for the nine months ended September 30, 2019 and 2018 and for each quarter for the 24 months ended September 30, 2019:
2017 2018 2019 Nine Months Ended September 30, Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2018 2019 Vessel Utilization: Ownership Days(1) 7,905 8,030 9,546 9,844 9,844 9,630 9,737 9,844 27,420 29,211 Less Off-hire Days: Scheduled Dry Docking (104) (8) (22) (13) (54) (36) (112) (103) Unscheduled Off-hire(2) (319) (149) (137) (146) (240) (166) (71) (3) (432) (240) Operating Days(1) 7,586 7,777 9,409 9,690 9,582 9,451 9,612 9,805 26,876 28,868 Vessel Utilization 96.0 96.8 98.6 98.4 97.3 98.1 98.7 99.6 98.0 98.8 % % % % % % % % % %
____________________________ (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 three and nine months ended September 30, 2019, compared with the same periods in 2018. The increase for the nine months ended September 30, 2019 was primarily due to a decrease in the number of unscheduled off-hire days and scheduled off-hire days for dry-docking.
Revenue
Revenue decreased by 4.2% to $282.7 million and increased by 5.3% to $843.5 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The decrease in revenue for the three months ended September 30, 2019 was primarily due to the changes in the daily charter hire rates of seven time charters which were modified in the first quarter of 2019, offset by higher operating days. Seaspan recognized $227.0 million of income from modification, and these seven charters were subsequently rechartered to other customers at market rates. The increase in revenue for the nine months ended September 30, 2019 was primarily due to the contribution of additional operating days from the acquisition of vessels from the GCI transaction and 2018 vessel deliveries.
The increase in operating days and the related financial impact thereof for the three and nine months ended September 30, 2019, respectively, compared to the same periods in 2018, is attributable to the following:
Three Months Ended Nine Months Ended September 30 September 30 Ownership Operating $ Impact Ownership Operating $ Impact Days Days (in millions Days Days (in Impact Impact of US Impact Impact millions dollars) of US dollars) Full period contribution from 2018 vessel deliveries $ 639 639 $ 17.3 Addition of 16 vessels from acquisition of GCI 1,152 1,152 42.9 Changes in daily charter hire rates and recharters 5.8 Changes in daily charter hire rates on modified (12.7) (24.4) charters(1) Unscheduled Off-hire(2) 143 1.2 192 2.4 Scheduled off-hire (28) (0.8) 9 (0.7) Other (1.2) Total 115 $ (12.3) 1,791 1,992 $ 42.1
_______________________________ (1) Seven time charters were modified in the first quarter of 2019 and Seaspan recognized $227.0 million of income from modification; these seven charters have been rechartered to other customers at market rates. (2) Unscheduled off-hire includes days related to vessels being off- charter.
Ship Operating Expense
Ship operating expense increased by 2.6% to $56.8 million and by 4.1% to $170.4 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The increase for the three months ended September 30, 2019 is primarily due to an increase in maintenance expenses. The increase for the nine months ended September 30, 2019 was primarily due to an increase in ownership days from the period contribution of the acquisition of vessels from the GCI transaction and 2018 vessel deliveries.
The following table summarizes Seaspan's operating cost per operating day for the nine months ended September 30, 2019 and 2018 and for each quarter for the 24 months ended September 30, 2019:
2017 2018 2019 Nine Months Ended September 30, Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2018 2019 Operating Cost: Ownership Days(1) 7,905 8,030 9,546 9,844 9,844 9,630 9,737 9,844 27,420 29,211 Vessel Operating Costs (in millions of US dollars) $ 48.1 $ 49.5 $ 58.8 $ 55.4 $ 55.6 $ 57.7 $ 55.9 $ 56.8 163.7 170.4 Operating Cost per $ 6,086 $ 6,170 $ 6,156 $ 5,624 $ 5,648 $ 5,993 $ 5,743 $ 5,770 $ 5,969 $ 5,833 Ownership Day
________________________________ (1) Ownership days include leased vessels and exclude vessels under bareboat charter.
Ship operating cost per ownership day increased by 2.6% to $5,770 and decreased by 2.3% to $5,833 for the three and nine months ended September 30, 2019, respectively, compared to the same periods in 2018.
Depreciation and Amortization Expense
Depreciation and amortization expense decreased by 1.8% to $63.9 million and increased by 4.8% to $189.8 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The decrease for the three months ended was primarily due to asset write-offs in 2018. The increase for the nine months ended September 30, 2019 was primarily due to an increase in ownership days from the period contribution of the acquisition of vessels from the GCI transaction and 2018 vessel deliveries.
General and Administrative Expense
General and administrative expense decreased by 4.9% to $7.7 million and by 4.9% to $23.3 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The decrease for the three months ended was primarily due to a decrease in professional fees and share-based compensation expenses. For the nine months ended September 30, 2019, this decrease was primarily due to transition payments paid to the former CFO in 2018.
Operating Lease Expense
Operating lease expense increased by 16.1% to $38.3 million and by 20.4% to $116.3 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The increase was primarily due to the amortization of deferred gains related to Seaspan's vessel sale-leaseback transactions, which are no longer recognized through operating leases. Upon adoption of Accounting Standards Update 2016-02 "Leases" on January 1, 2019, the remaining balance of these deferred gains were recognized through opening deficit as a cumulative adjustment.
Interest Expense and Amortization of Deferred Financing Fees
The following table summarizes Seaspan's borrowings:
(in millions of US dollars) September 30, 2019 2018 Long-term debt, excluding deferred financing fees: Revolving credit facilities $ 756.0 $ 812.3 Term loan credit facilities 1,648.8 2,243.8 Senior unsecured notes 80.0 417.9 Fairfax Notes 500.0 250.0 Debt discount and fair value adjustment (155.8) (88.1) Long-term obligations under other financing arrangements, excluding deferred financing fees 609.7 660.1 Total borrowings $ 3,438.7 $ 4,296.0
Interest expense and amortization of deferred financing fees decreased by $11.0 million to $45.0 million and increased by $2.1 million to $151.5 million for the three and nine months ended September 30, 2019, respectively, compared with the same periods in 2018. The decrease for the three months ended September 30, 2019 was primarily due to the early prepayments of long-term debt. The increase for the nine months ended September 30, 2019 was primarily due to the issuance of the Fairfax Notes and debt assumed in connection with the acquisition of GCI.
Change in Fair Value of Financial Instruments
The change in fair value of financial instruments resulted in a loss of $22.1 million and $37.7 million for the three and nine months ended September 30, 2019, respectively. The losses for this period were primarily due to the impact of swap settlements and a decrease in the LIBOR forward curve.
Liquidity and Unencumbered Vessels
As of September 30, 2019, Seaspan had total liquidity of $912.9 million, consisting of $258.9 million of cash and cash equivalents and $654.0 million available under its revolving credit facilities and term loan credit facilities.
As of September 30, 2019 --- TEU Class Vessel Count --- 2500 4 3500 2 4250 18 8500 2 10000 2 13100 1 14000 2 --- Total 31 ===
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 seven 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 SSWA 7.125% Senior Unsecured Notes due 2027 SSW25 5.500% Senior Notes due 2025 SSW26 5.500% Senior Notes due 2026
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 November 7, 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 (conference ID: 8690787). 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: 8690787).
SEASPAN CORPORATION UNAUDITED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2019 AND DECEMBER 31, 2018 (IN THOUSANDS OF US DOLLARS) September 30, 2019 December 31, 2018 --- Assets Current assets: Cash and cash equivalents $ 258,901 $ 357,327 Short-term investments 2,532 Accounts receivable 11,790 13,001 Prepaid expenses and other 32,129 36,519 Gross investment in lease 44,469 44,348 Fair value of financial instruments 113 347,289 453,840 Vessels 5,761,779 5,926,274 Right-of-use assets 985,563 Gross investment in lease 784,340 817,631 Goodwill 75,321 75,321 Other assets 185,416 204,931 $ 8,139,708 $ 7,477,997 === Liabilities, puttable preferred shares and shareholders' equity Current liabilities: Accounts payable and accrued liabilities 71,735 70,211 Current portion of deferred revenue 61,538 55,915 Current portion of long-term debt 361,882 722,641 Current portion of operating lease liabilities 159,757 Current portion of long-term obligations under other financing arrangements 144,328 48,384 Current portion of other long-term liabilities 7,124 32,243 806,364 929,394 Deferred revenue 351,889 376,884 Long-term debt 2,437,433 2,764,900 Operating lease liabilities 810,764 Long-term obligations under other financing arrangements 458,770 591,372 Other long-term liabilities 12,968 180,157 Fair value of financial instruments 56,323 127,172 4,934,511 4,969,879 Puttable preferred shares 48,139 Shareholders' equity: Share capital 2,491 2,102 Treasury shares (374) (371) Additional paid in capital 3,452,511 3,126,457 Deficit (227,632) (645,638) Accumulated other comprehensive loss (21,799) (22,571) 3,205,197 2,459,979 $ 8,139,708 $ 7,477,997 ===
SEASPAN CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018 (IN THOUSANDS OF US DOLLARS, EXCEPT PER SHARE AMOUNTS) Three Months Ended Nine Months Ended September 30, September 30, --- 2019 2018 2019 2018 --- Revenue $ 282,716 $ 294,981 $ 843,459 $ 801,419 Operating expenses (income): Ship operating 56,789 55,360 170,419 163,676 Depreciation and amortization 63,917 65,053 189,841 181,085 General and administrative 7,673 8,148 23,335 24,494 Operating leases 38,268 33,048 116,304 96,571 Income related to modification of time charters (227,000) 166,647 161,609 272,899 465,826 Operating earnings 116,069 133,372 570,560 335,593 Other expenses (income): Interest expense and amortization of deferred financing fees 44,999 56,038 151,464 149,387 Interest expense related to amortization of debt discount 4,439 2,193 12,910 5,091 Interest income (1,958) (1,128) (8,239) (2,893) Refinancing expenses 2,921 6,136 Acquisition related gain on contract settlement (2,430) Change in fair value of financial instruments 22,068 (4,526) 37,661 (29,775) Equity income on investment (1,216) Other expenses 637 822 2,386 1,728 73,106 53,399 202,318 119,892 Net earnings $ 42,963 $ 79,973 $ 368,242 $ 215,701 Dividends - preferred shares (17,917) (16,498) (54,254) (53,066) Net earnings attributable to common shares $ 25,046 $ 63,475 $ 313,988 $ 162,635 === Weighted average number of shares, basic 216,142 170,232 213,938 147,292 Effect of dilutive securities: Share-based compensation 697 543 460 381 Fairfax warrants 5,696 3,255 3,841 3,860 Weighted average number of shares, diluted 222,535 174,030 218,239 151,533 Earnings per share, basic $ 0.12 $ 0.37 $ 1.47 $ 1.10 === Earnings per share, diluted $ 0.11 $ 0.36 $ 1.44 $ 1.07 ===
SEASPAN CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018 (IN THOUSANDS OF US DOLLARS) Three Months Ended Nine Months Ended September 30, September 30, --- 2019 2018 2019 2018 --- Net earnings $ 42,963 $ 79,973 $ 368,242 $ 215,701 Other comprehensive income: Amounts reclassified to net earnings during the period relating to cash flow hedging instruments 254 271 772 847 Comprehensive income $ 43,217 $ 80,244 $ 369,014 $ 216,548 ===
SEASPAN CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018 (IN THOUSANDS OF US DOLLARS) Three Months Ended Nine Months Ended September 30, September 30, --- 2019 2018 2019 2018 --- Cash from (used in): Operating activities: Net earnings $ 42,963 $ 79,973 $ 368,242 $ 215,701 Items not involving cash: Depreciation and amortization 63,917 65,053 189,841 181,085 Amortization of right-of-use assets 28,036 83,443 Share-based compensation 693 355 2,655 1,905 Amortization of deferred financing fees, debt discount and fair value of long-term debt 7,743 5,726 22,629 14,283 Amounts reclassified from other comprehensive income to interest expense 70 80 219 254 Unrealized change in fair value of financial instruments (406) (13,925) (13,724) (62,834) Acquisition related gain on contract settlement (2,430) Equity income on investment (1,216) Deferred gain on sale-leasebacks (5,527) (16,636) Amortization of acquired revenue contracts 3,977 1,902 9,796 5,461 Refinancing expenses 2,921 6,136 Other (576) (355) (1,313) (1,044) Changes in assets and liabilities (3,425) 17,307 (22,763) 21,414 Cash from operating activities 145,913 150,589 645,161 355,943 Financing activities: Preferred shares issued, net of issuance costs 144,416 144,416 Repayment of credit facilities (367,040) (225,916) (1,276,755) (360,660) Draws on credit facilities 115,900 734,893 325,600 Fairfax notes and warrants issued 250,000 250,000 Draws on long-term obligations under other financing arrangements 46,964 Repayments on long-term obligations under other financing arrangements (12,787) (12,365) (38,004) (35,672) Senior unsecured notes repurchased, including related expenses (8,998) Redemption of preferred shares (47,782) (143,430) (47,782) (143,430) Repayments on senior unsecured notes (311,398) Proceeds from exercise of warrants 250,000 250,000 250,000 Financing fees (7,890) (2,753) (23,619) (15,868) Dividends on common shares (26,656) (9,549) (75,115) (28,358) Dividends on preferred shares (18,247) (14,720) (53,685) (49,680) Cash from (used in) financing activities (364,502) (14,317) (600,463) 383,312 Investing activities: Expenditures for vessels (3,532) (5,613) (9,810) (306,626) Short-term investments 106 (105) 2,532 (2,401) Prepayment on vessel purchase (6,620) (6,620) Other assets (1,100) (201) (6,806) 2,510 Loans to affiliate (427) Payments on settlement of interest swap agreements (104,825) (8,390) (122,054) (30,992) Acquisition of GCI (333,581) Cash acquired from GCI acquisition 70,121 Cash used in investing activities (115,971) (14,309) (142,758) (601,396) Increase (decrease) in cash, cash equivalents and restricted cash (334,560) 121,963 (98,060) 137,859 Cash, cash equivalents and restricted cash, beginning of period 607,896 283,132 371,396 267,236 Cash, cash equivalents and restricted cash, end of period $ 273,336 $ 405,095 $ 273,336 $ 405,095 === 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, 2019 2018 Cash and cash equivalents $ 258,901 $ 391,030 Restricted cash included in other assets 14,435 14,065 Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows $ 273,336 $ 405,095
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, without limitation, 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 as well as the likelihood of consummating any such transaction; -- 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 and exemption from tax on China-sourced international transportation service 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, 2018 on Form 20-F filed on March 26, 2019 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
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