May 11, 2010
Global Ship Lease Reports Results for the First Quarter of 2010

LONDON, ENGLAND--(Marketwire - May 11, 2010) - Global Ship Lease, Inc. (NYSE:GSL) (NYSE:GSL.U) (NYSE:GSL.WS), a containership charter owner, announced today its unaudited results for the three months ended March 31, 2010.

First Quarter Highlights

  • Generated $17.0 million of cash in the first quarter of 2010, up 11% on $15.3 million of cash generated in first quarter 2009
  • Reported revenue of $39.2 million for the first quarter of 2010, up 12% on $35.0 million for the first quarter 2009 due to the purchase of one additional vessel in August 2009
  • Reported normalized net earnings of $8.2 million, or $0.15 per A and B Common share, for the first quarter of 2010, excluding a $4.9 million non-cash interest rate derivative mark-to-market loss. Normalized net earnings for first quarter 2009 was $6.8 million, or $0.13 per A and B Common share, excluding $4.3 million non-cash mark-to-market gain
  • Including the non-cash mark-to-market items, reported net income was $3.3 million, or $0.06 income per share, for the first quarter of 2010 compared to $11.2 million, or $0.21 income per share, for the first quarter 2009

Ian Webber, Chief Executive Officer of Global Ship Lease, stated, "During the first quarter, we achieved utilization of 99.9%, reflecting less than two days unplanned off-hire. Our strong utilization is directly related to our entire 17-vessel fleet operating on long-term, fixed rate time charter contracts throughout the quarter. While conditions remain challenging in the container shipping sector, we are beginning to see positive signs including improved volumes and freight rates. In addition, reduced surplus capacity, and the subsequent firming of spot charter rates and asset values, has contributed to a nascent improvement in industry dynamics. However, the recovery remains fragile."

Mr. Webber continued, "Since amending our credit facility in August 2009, we have paid down $15 million in debt. We are committed to continuing to strengthen our financial position and expect to repay a further $79 million of debt over the next twelve months. The Company continues to be protected from short-term volatility in asset prices as we have no loan-to-value covenant assessments until end April 2011."


SELECTED FINANCIAL DATA - UNAUDITED
(thousands of U.S. dollars except per share data)



                                                   Three         Three
                                            months ended  months ended
                                            Mar 31, 2010  Mar 31, 2009
----------------------------------------------------------------------
Revenue                                           39,151        35,008
Operating Income                                  18,404        13,416
Net Income                                         3,281        11,153
Earnings per A and B share                          0.06          0.21
Normalised net earnings (1)                        8,160         6,844
Normalised earnings per A and B share (1)           0.15          0.13
Adjusted Cash From Operations (1)                 16,984        15,302


 


(1) Normalized net earnings, normalized earnings per share, and adjusted cash from operations are non-US Generally Accepted Accounting Principles (US GAAP) measures, as explained further in this press release, and reconciliations are provided to the interim unaudited financial information.

Revenue and Utilization

The 17-vessel fleet generated revenue from fixed rate long-term time charters of $39.2 million in the three months ended March 31, 2010, up 12% on revenue of $35.0 million for the comparative period in 2009 when one fewer vessel was deployed. During the three months ended March 31, 2010, there were 1,530 ownership days, up 90 or 6% on 1,440 ownership days in the comparable period in 2009. There were no dry-dockings in the three months ended March 31, 2010 and only an aggregate of two unplanned off-hire days, giving an overall utilization of 99.9%. In the comparable period of 2009, there were 34 unplanned off-hire days, representing utilization of 97.6%.

Vessel Operating Expenses

Vessel operating expenses, which include costs of crew, lubricating oil, spares and insurance, were $9.6 million for the three months ended March 31, 2010. The average cost per ownership day was $6,269 compared to the average daily cost of $6,299 for the previous quarter and down 11% from the average daily cost of $7,076 (excluding nonrecurring insurance related costs) for the comparative period in 2009. The reduction on the prior year is due to lower crew costs from slightly reduced manning levels and lower lubricating oil consumption from slow steaming and following installation of alpha lubricating equipment on a number of vessels.

Vessel operating expenses are at less than the capped amounts included in Global Ship Lease's ship management agreements.

Depreciation

Depreciation was $9.9 million for the three months ended March 31, 2010, including the effect of the purchase of one additional vessel in August 2009, compared to $8.8 million for the comparative period in 2009.

General and Administrative Costs

General and administrative costs incurred were $1.8 million in the three months ended March 31, 2010, including $0.3 million non-cash charge for stock based incentives, compared to $2.1 million for the comparable period in 2009, including $0.7 million non-cash charge for stock based incentives.

Interest Expense

Interest expense, excluding the effect of interest rate derivatives which do not qualify for hedge accounting, for the three months ended March 31, 2010 was $5.9 million. The Company's borrowings under its credit facility averaged $586.3 million during first quarter and were $584.1 million at March 31, 2010 after repayment in February 2010 of $4.1 million. There were $48.0 million preferred shares throughout the period. Interest expense in the comparative period in 2009 was $4.7 million based on average borrowings, including the preferred shares, of $590.1 million in the quarter.

Interest income for the three months ended March 31, 2010 was $35,000 and was $142,000 in the comparative 2009 period.

Change in Fair Value of Financial Instruments

The Company hedges the majority of its interest rate exposure by entering into derivatives that swap floating rate debt for fixed rate debt to provide long-term stability and predictability to cash flows. As these hedges do not qualify for hedge accounting under US GAAP, the outstanding hedges are marked to market at each period end with any change in the fair value being booked to the income and expenditure account. The Company's derivative hedging instruments gave a $9.3 million loss in the three months ended March 31, 2010, reflecting primarily movements in the forward curve for interest rates. Of this amount, $4.4 million was a realized loss for settlements of swaps in the period and $4.9 million was unrealized loss for revaluation of the balance sheet position. This compares to a $2.3 million gain in the three months ended March 31, 2009 of which $2.0 million was realized loss and $4.3 million was unrealized gain.

At March 31, 2010, the total mark-to-market unrealized loss recognized as a liability was $34.0 million.

Unrealized mark-to-market adjustments have no impact on operating performance or cash generation.

Net Earnings

Normalized net earnings was $8.2 million, or $0.15 per Class A and B common share, for the three months ended March 31, 2010 excluding the $4.9 million non-cash interest rate derivative mark-to-market loss. Including the mark-to-market loss, reported net income was $3.3 million or $0.06 income per Class A and B common share.

Normalized net earnings and normalized earnings per share are non-US GAAP measures and are reconciled to the financial information included in this press release. We believe that they are useful measures with which to assess the Company's financial performance as they adjust for non-cash items that do not affect the Company's ability to generate cash.

Credit Facility

On August 20, 2009, the Company entered into an amendment to its credit facility, whereby the loan-to-value covenant has been waived up to and including November 30, 2010 with the next loan-to-value test scheduled for April 30, 2011. Further, Global Ship Lease was able to borrow sufficient funds under the credit facility to allow the purchase of the CMA CGM Berlioz in August 2009. Amounts borrowed under the amended credit facility bear interest at LIBOR plus a fixed interest margin of 3.50% up to November 30, 2010. Thereafter, the margin will be between 2.50% and 3.50% depending on the loan-to-value ratio.

In connection with the amended credit facility, all undrawn commitments of approximately $200 million were cancelled and Global Ship Lease may not pay dividends to common shareholders, instead using its cash flow to prepay borrowings under the credit facility. Global Ship Lease will be able to resume dividends after November 30, 2010 and once the loan-to-value is at or below 75%, when the prepayment of borrowings becomes fixed at $10 million per quarter. As part of the amendment, CMA CGM has agreed to defer redemption of the $48 million preferred shares it holds until after the final maturity of the credit facility in August 2016 and retain its current holding of approximately 24.4 million common shares at least until November 30, 2010.

Dividend

Global Ship Lease has agreed with its lenders that it will not declare or pay any dividend to common shareholders until the later of November 30, 2010 and when loan-to-value is at or below 75%. The board of directors will review the dividend policy when appropriate.

Adjusted Cash From Operations

Adjusted cash from operations was $17.0 million for the three months ended March 31, 2010 compared to $15.3 million for the three months ended March 31, 2009. Adjusted cash from operations is a non-US GAAP measure and is reconciled to the financial information further in this press release. The Company believes that it is a useful measure with which to assess the Company's operating performance as it adjusts for the effects of non-cash items.

Fleet Utilization

The table below shows fleet utilization for the three months ended March 31, 2010 and 2009 and for year ended December 31, 2009. Unplanned offhire in the three months ended March 31, 2009 includes 18 days for drydock and associated repairs following a grounding and a seven day deviation to land a sick crew member.




                                                                     Year
                                  Three months ended                ended
-------------------------------------------------------------------------
                                    Mar 31,   Mar 31,              Dec 31,
Days                                  2010      2009    Increase     2009
-------------------------------------------------------------------------
                                                                         
Ownership days                       1,530     1,440          6%    5,968
Planned offhire - scheduled drydock      -         -                  (32)
Unplanned offhire                       (2)      (34)                 (42)
                                   --------------------------------------
Operating days                       1,528     1,406          9%    5,894
                                                                         
Utilization                           99.9%     97.6%                98.8%
 
Fleet


The following table provides information about the on-the-water fleet of
17 vessels chartered to CMA CGM.



                                                      Charter
                                                    Remaining     Daily
Vessel             Capacity   Year    Purchase Date  Duration    Charter
Name              in TEUs(1) Built           by GSL    (years)   Rate ($)
------------------------------------------------------------------------
Ville d'Orion         4,113   1997    December 2007      2.75    $28,500
Ville d'Aquarius      4,113   1996    December 2007      2.75    $28,500   
CMA CGM Matisse       2,262   1999    December 2007      6.75    $18,465   
CMA CGM Utrillo       2,262   1999    December 2007      6.75    $18,465   
Delmas Keta           2,207   2003    December 2007      7.75    $18,465   
Julie Delmas          2,207   2002    December 2007      7.75    $18,465   
Kumasi                2,207   2002    December 2007      7.75    $18,465   
Marie Delmas          2,207   2002    December 2007      7.75    $18,465   
CMA CGM La Tour       2,272   2001    December 2007      6.75    $18,465   
CMA CGM Manet         2,272   2001    December 2007      6.75    $18,465   
CMA CGM Alcazar       5,100   2007     January 2008     10.75    $33,750   
CMA CGM Chateau d'If  5,100   2007     January 2008     10.75    $33,750   
CMA CGM Thalassa     10,960   2008    December 2008     15.75    $47,200   
CMA CGM Jamaica       4,298   2006    December 2008     12.75    $25,350   
CMA CGM Sambhar       4,045   2006    December 2008     12.75    $25,350   
CMA CGM America       4,045   2006    December 2008     12.75    $25,350   
CMA CGM Berlioz       6,627   2001      August 2009     11.50    $34,000   


1.  Twenty-foot Equivalent Units.
 
The following table provides information about the contracted fleet.



                                                                           
                                                          Charter     Daily
Vessel        Capacity    Year       Estimated           Duration   Charter
Name        in TEUs (1)  Built   Delivery Date  Charterer  (years)  Rate($)
---------------------------------------------------------------------------
Hull 789 (2)     4,250    2010   December 2010     ZIM     7-8 (3)  $28,000
Hull 790 (2)     4,250    2010   December 2010     ZIM     7-8 (3)  $28,000
                                                                           


1.  Twenty-foot Equivalent Units. 
2.  Contracted to be purchased from German interests. 
3.  Seven-year charter that could be extended to eight years at charterer's
    option.

Conference Call and Webcast

Global Ship Lease will hold a conference call to discuss the Company's results for the three months ended March 31, 2010 today, Tuesday, May 11, 2010 at 10:30 a.m. Eastern Time. There are two ways to access the conference call:

(1) Dial-in: (877) 491-0064 or (334) 323-6201; Passcode: 864755

Please dial in at least 10 minutes prior to 10:30 a.m. Eastern Time to ensure a prompt start to the call.

(2) Live Internet webcast and slide presentation: http://www.globalshiplease.com

If you are unable to participate at this time, a replay of the call will be available through Tuesday, May 25, 2010 at (888) 365-0240 or (954) 334-0342. Enter the code 864755 to access the audio replay. The webcast will also be archived on the Company's website: http://www.globalshiplease.com.

About Global Ship Lease

Global Ship Lease is a containership charter owner. Incorporated in the Marshall Islands, Global Ship Lease commenced operations in December 2007 with a business of owning and chartering out containerships under long-term, fixed rate charters to world class container liner companies.

Global Ship Lease owns 17 vessels with a total capacity of 66,297 TEU with a weighted average age at March 31, 2010 of 5.6 years. All of the current vessels are fixed on long-term charters to CMA CGM with an average remaining term of 8.9 years. The Company has contracts in place to purchase two 4,250 TEU newbuildings from German interests for approximately $77 million each that are scheduled to be delivered in the fourth quarter of 2010. The Company has agreements to charter out these newbuildings to Zim Integrated Shipping Services Limited for seven or eight years at charterer's option.

Reconciliation of Non-U.S. GAAP Financial Measures

A. Adjusted Cash From Operations

Adjusted cash from operations is a non-US GAAP measure and is reconciled to the financial information below. It represents net earnings adjusted for non-cash items including depreciation, amortization of deferred financing charges, accretion of earnings for intangible liabilities, charge for equity based incentive awards and change in fair value of derivatives. We also deduct an allowance for the cost of future drydockings, which due to their substantial and periodic nature could otherwise distort quarterly adjusted cashflow. There is no adjustment for movements in working capital. Adjusted cash from operations is a non-US GAAP quantitative measure used to assist in the assessment of the Company's ability to generate cash. Adjusted cash from operations is not defined in accounting principles generally accepted in the United States and should not be considered to be an alternate to net earnings or any other financial metric required by such accounting principles. We believe that adjusted cash from operations is a useful measure with which to assess the Company's operating performance as it adjusts for the effects of non-cash items.




ADJUSTED CASH FROM OPERATIONS - UNAUDITED
(thousands of U.S. dollars) 



                                                        Three        Three
                                                       months       months
                                                        ended        ended
                                                 Mar 31, 2010 Mar 31, 2009
--------------------------------------------------------------------------
                                                                           
Net income                                              3,281      11,153
                                                                           
Adjust:  Depreciation                                   9,871        8,786
         Charge for equity incentive awards               311          716
         Amortization of deferred financing fees          226          374
         Change in value of derivatives                 4,879       (4,309)
         Allowance for future dry-docks                  (975)        (900)
         Revenue accretion for intangible liabilities    (530)        (311)
         Deferred taxation                                (79)        (207)
--------------------------------------------------------------------------
Adjusted cash from operations                          16,984       15,302
--------------------------------------------------------------------------
--------------------------------------------------------------------------


 


B. Normalized net earnings

Normalized net earnings is a non-US GAAP measure and is reconciled to the financial information below. It represents net earnings adjusted for the change in fair value of derivatives and the accelerated write off of a portion of deferred financing costs. Normalized net earnings is a non-GAAP quantitative measure which we believe will assist investors and analysts who often adjust reported net earnings for non-operating items such as change in fair value of derivatives to eliminate the effect of non cash non-operating items that do not affect operating performance or cash generated. Normalized net earnings is not defined in accounting principles generally accepted in the United States and should not be considered to be an alternate to net earnings or any other financial metric required by such accounting principles. Normalized net earnings per share is calculated based on normalized net earnings and the weighted average number of shares in the relevant period.




NORMALIZED NET EARNINGS -   UNAUDITED                       
(thousands of U.S. dollars except share and per share data) 


                                                       Three          Three
                                                      months         months
                                                       ended          ended
                                                Mar 31, 2010   Mar 31, 2009
---------------------------------------------------------------------------
                                                                           
Net income as reported                                 3,281        11,153
Adjust:Change in value of derivatives                  4,879        (4,309)
---------------------------------------------------------------------------
Normalized net earnings                                8,160         6,844
---------------------------------------------------------------------------
---------------------------------------------------------------------------
                                                                           
Weighted average number of Class A and B 
 common shares outstanding (1)            
                                                                           
       Basic                                      54,236,423    53,786,150
       Diluted                                    54,343,502    53,786,150
Net income per share on reported earnings                                  
       Basic                                            0.06          0.21
       Diluted                                          0.06          0.21
Normalized net income per share                                          
       Basic                                            0.15          0.13
       Diluted                                          0.15          0.13

 

(1) The weighted average number of shares (basic and diluted) for the three months ended March 31, 2010 and 2009 excludes the effect of outstanding warrants and for the three months ended March 31, 2009 stock based incentive awards as these were anti dilutive.

Safe Harbor Statement

This communication contains forward-looking statements. Forward-looking statements provide Global Ship Lease's current expectations or forecasts of future events. Forward-looking statements include statements about Global Ship Lease's expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts. Words or phrases such as "anticipate," "believe," "continue," "estimate," "expect," "intend," "may," "ongoing," "plan," "potential," "predict," "project," "will" or similar words or phrases, or the negatives of those words or phrases, may identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking. These forward-looking statements are based on assumptions that may be incorrect, and Global Ship Lease cannot assure you that these projections included in these forward-looking statements will come to pass. Actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors.The risks and uncertainties include, but are not limited to:

  • future operating or financial results;
  • expectations regarding the future growth of the container shipping industry, including the rates of annual demand and supply growth;
  • the financial condition of CMA CGM, our charterer and sole source of operating revenue, and its ability to pay charterhire in accordance with the charters;
  • Global Ship Lease's financial condition and liquidity, including its ability to obtain additional waivers which might be necessary under the existing credit facility or obtain additional financing to fund capital expenditures, contracted and yet to be contracted vessel acquisitions including the two newbuildings to be purchased from German interests in the fourth quarter of 2010, and other general corporate purposes;
  • Global Ship Lease's ability to meet its financial covenants and repay its credit facility;
  • Global Ship Lease's expectations relating to dividend payments and forecasts of its ability to make such payments including the availability of cash and the impact of constraints under its credit facility;
  • future acquisitions, business strategy and expected capital spending;
  • operating expenses, availability of crew, number of off-hire days, drydocking and survey requirements and insurance costs;
  • general market conditions and shipping industry trends, including charter rates and factors affecting supply and demand;
  • assumptions regarding interest rates and inflation;
  • changes in the rate of growth of global and various regional economies;
  • risks incidental to vessel operation, including piracy, discharge of pollutants and vessel accidents and damage including total or constructive total loss;
  • estimated future capital expenditures needed to preserve its capital base;
  • Global Ship Lease's expectations about the availability of ships to purchase, the time that it may take to construct new ships, or the useful lives of its ships;
  • Global Ship Lease's continued ability to enter into or renew long-term, fixed-rate charters;
  • the continued performance of existing long-term, fixed-rate time charters;
  • Global Ship Lease's ability to capitalize on its management team's and board of directors' relationships and reputations in the containership industry to its advantage;
  • changes in governmental and classification societies' rules and regulations or actions taken by regulatory authorities;
  • expectations about the availability of insurance on
  • commercially reasonable terms;
  • unanticipated changes in laws and regulations including taxation;
  • potential liability from future litigation.

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Global Ship Lease's actual results could differ materially from those anticipated in forward-looking statements for many reasons specifically as described in Global Ship Lease's filings with the SEC. Accordingly, you should not unduly rely on these forward-looking statements, which speak only as of the date of this communication. Global Ship Lease undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this communication or to reflect the occurrence of unanticipated events. You should, however, review the factors and risks Global Ship Lease describes in the reports it will file from time to time with the SEC after the date of this communication.

Global Ship Lease, Inc.


Interim Unaudited Consolidated Statements of Income


(Expressed in thousands of U.S. dollars except share data)



                                               Three months ended March 31,
                                                       2010           2009
                                                                           
                                                                           
Operating Revenues                                                         
Time charter revenue                               $ 39,151       $ 35,008
---------------------------------------------------------------------------
                                                                          
                                                                           
Operating Expenses


Vessel operating expenses                             9,592         10,722
Depreciation                                          9,871          8,786
General and administrative                            1,836          2,140
Other operating (income)                               (552)           (56)
---------------------------------------------------------------------------
                                                           
Total operating expenses                             20,747         21,592
---------------------------------------------------------------------------


                                                                         
Operating Income                                     18,404         13,416
                                                                        
Non Operating Income (Expense)                                             
Interest income                                          35            142
Interest expense                                     (5,856)        (4,654)
Realized and unrealized (loss) gain on interest
 rate derivatives                                    (9,274)         2,275
---------------------------------------------------------------------------


Income before Income Taxes                             3,309        11,179
                                                                       
Income taxes                                             (28)          (26)
---------------------------------------------------------------------------
                                                                           
Net Income                                           $ 3,281      $ 11,153
---------------------------------------------------------------------------
---------------------------------------------------------------------------
                                                                          
Weighted average number of Class A common 
 shares outstanding                
    Basic                                        46,830,467     46,380,194
    Diluted                                      46,937,546     46,380,194
Net Income in $ per Class A common share                                   
    Basic                                            $ 0.07         $ 0.23
    Diluted                                          $ 0.07         $ 0.23
Weighted average number of Class B common 
 shares outstanding                                             
    Basic and diluted                             7,405,956      7,405,956
Net income in $ per Class B common share                                   
    Basic and diluted                                 $ nil         $ 0.07
 


Global Ship Lease, Inc.


Interim Unaudited Consolidated Balance Sheets


(Expressed in thousands of U.S. dollars)



                                                March 31,      December 31,
                                                    2010              2009
                                                                           
Assets                                                                     
Cash and cash equivalents                       $ 41,356          $ 30,810
Restricted cash                                    3,026             3,026
Accounts receivable                                7,130             7,838
Prepaid expenses                                     991               685
Other receivables                                  1,118               613
Deferred tax                                         336               285
Deferred financing costs                             903               903
---------------------------------------------------------------------------
                                                                          
Total current assets                              54,860            44,160
---------------------------------------------------------------------------
                                                                          
                                                                           
Vessels in operation                             952,003           961,708
Vessel deposits                                   16,390            16,243
Other fixed assets                                     6                 9
Deferred tax                                         189               161
Deferred financing costs                           4,850             5,077
---------------------------------------------------------------------------
                                                                           
Total non-current assets                         973,438           983,198
---------------------------------------------------------------------------
                                                                           
Total Assets                                 $ 1,028,298       $ 1,027,358
---------------------------------------------------------------------------
---------------------------------------------------------------------------
                                                                           
Liabilities and Stockholders' Equity                                       
                                                                           
Liabilities                                                                
Intangible liability - charter agreements        $ 2,119           $ 2,119
Current portion of long term debt                 79,500            68,300
Accounts payable                                      13             3,502
Accrued expenses                                   5,167             4,589
Derivative instruments                            14,874            15,971
---------------------------------------------------------------------------
                                                                           
Total current liabilities                        101,673            94,481
---------------------------------------------------------------------------
                                                                           
                                                                          
Long term debt                                   504,600           519,892
Preferred shares                                  48,000            48,000
Intangible liability - charter agreements         23,759            24,288
Derivative instruments                            19,119            13,142
---------------------------------------------------------------------------
                                                                          
Total long-term liabilities                      595,478           605,322
---------------------------------------------------------------------------
                                                                          
                                                                          
Total Liabilities                              $ 697,151         $ 699,803
---------------------------------------------------------------------------
                                                                           
                                                                           
Commitments and contingencies                           -                -
                                                                           
Stockholders' Equity                                                       
Class A Common stock - authorized                                          
 214,000,000 shares with a $0.01 par                                       
 value; 46,830,467 shares issued and                                       
 outstanding                                        $ 468            $ 467
Class B Common stock - authorized                                          
 20,000,000 shares with a $0.01 par value;                                 
 7,405,956 shares issued and outstanding               74               74
                                                                          
Retained deficit                                  (23,305)         (65,679)
Net income for the period                           3,281           42,374
Additional paid in capital                        350,629          350,319
---------------------------------------------------------------------------
                                                                           
Total Stockholders' Equity                        331,147          327,555
---------------------------------------------------------------------------
                                                                           
Total Liabilities and Stockholders' Equity    $ 1,028,298      $ 1,027,358
---------------------------------------------------------------------------
---------------------------------------------------------------------------
 



Global Ship Lease, Inc.


Interim Unaudited Consolidated Statements of Cash Flows


(Expressed in thousands of U.S. dollars)



                                               Three months ended March 31,
                                                    2010              2009
                                                                          
Cash Flows from Operating Activities                                      
Net income                                       $ 3,281          $ 11,153
                                                                          
Adjustments to Reconcile Net Income to Net 
 Cash Provided by Operating Activities                          
Depreciation                                       9,871             8,786
Amortization of deferred financing costs             226               374
Change in fair value of certain 
 derivative instruments                            4,879            (4,309)
Amortization of intangible liability                (530)             (311)
Settlements of hedges which do not qualify for 
 hedge accounting                                  4,395             2,034
Share based compensation                             311               716
(Increase) decrease in other receivables 
  and other assets                                  (195)              386
(Decrease) in accounts payable and 
  other liabilities                               (2,772)           (1,531)
Costs relating to drydocks                          (164)                -
Unrealized foreign exchange loss                      39                 -
---------------------------------------------------------------------------
                                                                           
Net Cash Provided by Operating Activities         19,341            17,298
---------------------------------------------------------------------------
                                                                     
Cash Flows from Investing Activities                                       
Settlements of hedges which do not 
 qualify for hedge accounting                     (4,395)           (2,034)
Cash paid for purchases of vessels, vessel 
 prepayments and vessel deposits                    (308)             (580)
---------------------------------------------------------------------------
                                                                           
Net Cash (Used in) Investing Activities           (4,703)           (2,614)
---------------------------------------------------------------------------
                                                                         
Cash Flows from Financing Activities                                      
Repayments of debt                                (4,092)                -
Issuance costs of debt                                 -            (3,293)
Dividend payments                                      -           (12,371)
---------------------------------------------------------------------------
                                                                           
Net Cash Used in Financing Activities             (4,092)          (15,664)
---------------------------------------------------------------------------
                                                                      
Net Increase (Decrease) in Cash and 
 Cash Equivalents                                 10,546              (980)
Cash and Cash Equivalents at start of Period      30,810            26,363
---------------------------------------------------------------------------
Cash and Cash Equivalents at end of Period      $ 41,356          $ 25,383
---------------------------------------------------------------------------
---------------------------------------------------------------------------


FOR FURTHER INFORMATION PLEASE CONTACT:
The IGB Group
Michael Cimini
Investor and Media Contacts
212-477-8261


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