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Globus Maritime Limited Reports Financial Results for the quarter and nine-month period ended September 30, 2021

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  • GLBS

GLYFADA, Greece, Nov. 30, 2021 (GLOBE NEWSWIRE) -- Globus Maritime Limited (“Globus”, the “Company”, “we”, or “our”) (NASDAQ: GLBS), a dry bulk shipping company, today reported its unaudited consolidated operating and financial results for the quarter and nine-month period ended September 30, 2021.

Financial Highlights

  • In 9M2021, Total revenues increased by about 217% compared to 9M2020.

  • For the 9M2021 the Total comprehensive income amounted to $4.8 million compared to a Total comprehensive loss of $14.5 million for 9M2020.

  • The Adjusted EBITDA for 9M2021 increased by about 14.3 million compared to 9M2020.

  • As at September 30, 2021, and December 31, 2020, our cash and bank balances and bank deposits (including restricted cash) were $67.9 and $21.1 million, respectively, an increase of 222%.

  • As at September 30, 2021, the total outstanding borrowings under our Loan agreements decreased to $33 million compared to $37 million as at December 31, 2020, gross of unamortized debt discount, a decrease of about 11%.

Three months ended
September 30,

Nine months ended
September 30,

(Expressed in thousands of U.S dollars except for daily rates and per share data)

2021

2020

2021

2020

Total revenues

12,755

3,183

24,751

7,772

Total comprehensive income/(loss)

5,576

(1,267

)

4,787

(14,466

)

Adjusted EBITDA (1)

7,814

294

12,175

(2,153

)

Basic and Diluted income/(loss) per share (2)

0.27

(0.80

)

0.37

(24.76

)

Daily Time charter equivalent rate (“TCE”) (3)

17,057

6,404

13,325

4,191

Average operating expenses per vessel per day

4,981

4,391

5,278

4,422

Average number of vessels

7.8

5.0

6.7

5.0


(1)

Adjusted EBITDA is a measure not in accordance with generally accepted accounting principles (“GAAP”). See a later section of this press release for a reconciliation of Adjusted EBITDA to total comprehensive loss and net cash used in operating activities, which are the most directly comparable financial measures calculated and presented in accordance with the GAAP measures.

(2)

The basic and diluted weighted average number of shares for the nine-month period ended September 30, 2021, was 12,865,496 compared to 584,158 shares for the nine-month period ended September 30, 2020. The basic and diluted weighted average number of shares for the three-month period ended September 30, 2021, was 20,467,086 compared to 1,574,877 shares for the three-month period ended September 30, 2020.

(3)

Daily Time charter equivalent rate (“TCE”) is a measure not in accordance with generally accepted accounting principles (“GAAP”). See a later section of this press release for a reconciliation of Daily TCE to Voyage revenues.

Current Fleet Profile
As at the date of this press release, Globus’ subsidiaries own and operate nine dry bulk carriers, consisting of four Supramax, one Panamax and four Kamsarmax.

Vessel

Year Built

Yard

Type

Month/Year Delivered

DWT

Flag

Moon Globe

2005

Hudong-Zhonghua

Panamax

June 2011

74,432

Marshall Is.

Sun Globe

2007

Tsuneishi Cebu

Supramax

Sept 2011

58,790

Malta

River Globe

2007

Yangzhou Dayang

Supramax

Dec 2007

53,627

Marshall Is.

Sky Globe

2009

Taizhou Kouan

Supramax

May 2010

56,855

Marshall Is.

Star Globe

2010

Taizhou Kouan

Supramax

May 2010

56,867

Marshall Is.

Galaxy Globe

2015

Hudong-Zhonghua

Kamsarmax

October 2020

81,167

Marshall Is.

Diamond Globe

2018

Jiangsu New Yangzi Shipbuilding Co.

Kamsarmax

June 2021

82,027

Marshall Is.

Power Globe

2011

Universal Shipbuilding Corporation

Kamsarmax

July 2021

80,655

Marshall Is.

Orion Globe

2015

Tsuneishi Zosen

Kamsarmax

November 2021

81,837

Marshall Is.

Weighted Average Age: 10.1 Years as at November 30, 2021

626,257

Current Fleet Deployment

All our vessels are currently operating on short-term time charters (“on spot”).

Management Commentary

“The third quarter of 2021 was pivotal for our company -- it signified the return to profit after a prolonged time of depressed market conditions. We were pleased that the market moved to higher territories and provided rates for our vessels not seen in a long time. We remain optimistic on the supply and demand fundamentals of the market for the near and medium term.

We continue to operate on short term spot charters in order to try and fully utilize the market dynamics. We expect short-term fluctuations and generally take into account the volatility involved in market seasonality as we examine market opportunities.

This quarter was the first quarter that we fully benefited from our previously announced refinancing arrangements as it is indicated in our financing costs stated for the period. We continue to scan the market for financing options that best suit our needs and plans for the future. At the same time, we are evaluating possible vessel candidates in our constant effort for fleet expansion and renewal.

COVID-19 continues to significantly affect our market and our operations. We remain vigilant to the inefficiencies and issues related to the pandemic that affect trade routes, ports and charterer operations. We remain committed at these tough times to support and help our crew on board of our vessels, and to take care of their needs.

Last but not least we are confident that we are well positioned to reap the benefits of a robust market and we believe that our balance sheet is strong enough to support future growth and expansion.”

Management Discussion and Analysis of the Results of Operations

Recent Developments

Issuance of the Series B preferred shares

On March 2, 2021, we issued an additional 10,000 of our Series B Preferred Shares to Goldenmare Limited in return for $130,000. The $130,000 was paid by reducing, on a dollar-for-dollar basis, the amount payable as compensation by the Company to Goldenmare Limited pursuant to a consultancy agreement.

The issuance of the Series B preferred shares to Goldenmare Limited was approved by an independent committee of the Board of Directors of the Company, which received a fairness opinion from an independent financial advisor.

Each Series B preferred share entitles the holder thereof to 25,000 votes per share on all matters submitted to a vote of the shareholders of the Company, provided however, that no holder of Series B preferred shares may exercise voting rights pursuant to Series B preferred shares that would result in the aggregate voting power of any beneficial owner of such shares and its affiliates (whether pursuant to ownership of Series B preferred shares, common shares or otherwise) to exceed 49.99% of the total number of votes eligible to be cast on any matter submitted to a vote of shareholders of the Company. To the fullest extent permitted by law, the holders of Series B preferred shares shall have no special voting or consent rights and shall vote together as one class with the holders of the common shares on all matters put before the shareholders. The Series B preferred shares are not convertible into common shares or any other security. They are not redeemable and have no dividend rights. Upon any liquidation, dissolution or winding up of the Company, the Series B preferred shares are entitled to receive a payment with priority over the common shareholders equal to the par value of $0.001 per share. The Series B preferred shareholder has no other rights to distributions upon any liquidation, dissolution or winding up of the Company. All issued and outstanding Series B preferred shares must be held of record by one holder, and the Series B preferred shares shall not be transferred without the prior approval of our Board of Directors. Finally, in the event the Company (i) declares any dividend on its common shares, payable in common shares, (ii) subdivides the outstanding common shares or (iii) combines the outstanding common shares into a smaller number of shares, there shall be a proportional adjustment to the number of outstanding Series B preferred shares.

As at September 30, 2021, Goldenmare Limited owned 10,300 of the Company’s Series B preferred shares.

Public Offerings

On January 13, 2021, the remaining pre-funded warrants from the December 2020 Pre-Funded Warrants were exercised and 130,000 common shares, par value $0.004 per share were issued.

On January 27, 2021, the Company entered into a securities purchase agreement with certain unaffiliated institutional investors to issue (a) 2,155,000 common shares, par value $0.004 per share, (b) pre-funded warrants to purchase 445,000 common shares, par value $0.004 per share and (c) warrants (the “January 2021 Warrants”) to purchase 1,950,000 common shares, par value $0.004 per share, at an exercise price of $6.25 per share. Total proceeds, net of commission retained by the placement agent, amounted to $15,108,050, before issuance expenses of approximately $122,000. The pre-funded warrants were all exercised subsequently, and the total proceeds amounted to $4,450. No January 2021 Warrants have been exercised as the date hereof.

The January 2021 Warrants are exercisable for a period of five and one-half years commencing on the date of issuance. The warrants will be exercisable, at the option of each holder, in whole or in part by delivering to the Company a duly executed exercise notice with payment in full in immediately available funds for the number of common shares purchased upon such exercise. If a registration statement registering the issuance of the common shares underlying the warrants under the Securities Act is not effective, the holder may, in its sole discretion, elect to exercise the warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of common shares determined according to the formula set forth in the warrant. If the Company does not issue the shares in a timely fashion, the warrant contains certain liquidated damages provisions.

On February 12, 2021, the Company entered into a securities purchase agreement with certain unaffiliated institutional investors to issue (a) 3,850,000 common shares par value $0.004 per share, (b) pre-funded warrants to purchase 950,000 common shares, par value $0.004 par value, and (c) warrants (the “February 2021 Warrants”) to purchase 4,800,000 common shares, par value $0.004 per share, at an exercise price of $6.25 per share. Total proceeds, net of commission retained by the placement agent, amounted to $27,890,500 before issuance expenses of approximately $150,000. The pre-funded warrants were all exercised subsequently, and the total proceeds amounted to $9,500. No February 2021 Warrants have been exercised as the date hereof.

The February 2021 Warrants are exercisable for a period of five and one-half years commencing on the date of issuance. The warrants will be exercisable, at the option of each holder, in whole or in part by delivering to the Company a duly executed exercise notice with payment in full in immediately available funds for the number of common shares purchased upon such exercise. If a registration statement registering the issuance of the common shares underlying the warrants under the Securities Act is not effective, the holder may, in its sole discretion, elect to exercise the warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of common shares determined according to the formula set forth in the warrant. If the Company does not issue the shares in a timely fashion, the warrant contains certain liquidated damages provisions.

On June 25, 2021, the Company entered into a securities purchase agreement with certain unaffiliated institutional investors to issue (a) 8,900,000 common shares par value $0.004 per share, (b) pre-funded warrants to purchase 1,100,000 common shares, par value $0.004 par value, and (c) warrants (the “June 2021 Warrants”) to purchase 10,000,000 common shares, par value $0.004 per share, at an exercise price of $5.00 per share. Total proceeds, net of commission retained by the placement agent, amounted to $46,580,875 before issuance expenses of approximately $129,000. The pre-funded warrants were all exercised subsequently, and the total proceeds amounted to $11,000. No June 2021 Warrants have been exercised as the date hereof.

The June 2021 Warrants are exercisable for a period of five and one-half years commencing on the date of issuance. The warrants will be exercisable, at the option of each holder, in whole or in part by delivering to the Company a duly executed exercise notice with payment in full in immediately available funds for the number of common shares purchased upon such exercise. If a registration statement registering the issuance of the common shares underlying the warrants under the Securities Act is not effective, the holder may, in its sole discretion, elect to exercise the warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of common shares determined according to the formula set forth in the warrant. If the Company does not issue the shares in a timely fashion, the warrant contains certain liquidated damages provisions.

The total outstanding number of warrants as at September 30, 2021, was 19,701,120 to purchase an aggregate of 19,701,120 common shares.

Acquisition of new vessels

On June 9, 2021, the Company took delivery of the m/v “Diamond Globe”, a 2018-built Kamsarmax dry bulk carrier, through its subsidiary, Argo Maritime Limited, for a purchase price of $27 million financed with available cash. The m/v “Diamond Globe” was built at Jiangsu New Yangzi Shipbuilding Co., Ltd and has a carrying capacity of 82,027 dwt.

On July 20, 2021, the Company took delivery of the m/v “Power Globe”, a 2011-built Kamsarmax dry bulk carrier, through its subsidiary, Talisman Maritime Limited, for a purchase price of $16.2 million financed with available cash. The m/v “Power Globe” was built at Universal Shipbuilding Corporation in Japan and has a carrying capacity of 80,655 dwt.

On November 29, 2021, the Company took delivery of the m/v “Orion Globe”, a 2015-built Kamsarmax dry bulk carrier, through its subsidiary, Salaminia Maritime Limited, for a purchase price of $28.4 million financed with available cash. The m/v “Orion Globe” was built at Tsuneishi Zosen in Japan and has a carrying capacity of 81,837 dwt.

Debt financing

In March 2021, the Company prepaid $6.0 million of the Entrust loan facility, which represented all amounts that would otherwise come due during calendar year 2021. As a result, after this pre-payment we had an aggregate debt outstanding of $31 million, gross of unamortized debt costs, from the Entrust Loan Facility.

On May 10, 2021, the Company reached an agreement with CiT Bank N.A. for a loan facility of $34.25 million bearing interest at LIBOR plus a margin of 3.75% per annum. This loan facility is referred to as the CiT loan facility. The proceeds of this financing were used to repay the outstanding balance of EnTrust Loan Facility.

Impact of COVID-19 on the Company’s Business

The spread of the COVID-19 virus, which has been declared a pandemic by the World Health Organization in 2020 had caused substantial disruptions in the global economy and the shipping industry, as well as significant volatility in the financial markets.

The measures taken by governments worldwide in response to the outbreak, which included numerous factory closures, self-quarantining, and restrictions on travel, as well as potential labour shortages resulting from the outbreak, had slowed down production of goods worldwide and decreased the amount of goods exported and imported worldwide.

Crewing and Crew management operations.

Due to COVID-19 there are restrictions on travelling on many jurisdictions. We may face problems in the embarkation and disembarkation our crew members. Many airports around the world as well as many countries impose heavy travel restrictions such as quarantine periods for incoming and outgoing travelers. By extent it is increasingly hard, if not restrictive, for our crews to be relieved by new crew members. We continue to monitor the situation with respect and utmost care for our seafarers, always communicating with the relevant authorities in order to assist them as much as we can in these unprecedented times.

Disruption in operations in case crew members get infected.

In case one of our crew members is found to be infected by COVID-19 this may lead to delays in cargo operations. It may also need to a detention and quarantine of the ship for an unspecified amount of time. Relevant authorities may require us to perform disinfection and fumigation operations if a crew member gets infected by COVID-19. Crew members may be quarantined if a member is found to be infected. The above may lead to increased costs and lower utilization of our fleet.

Dry docking and Repairs.

Repair yards and dry docks in the Far East, usually selected for the scheduled maintenance of our vessels, may be affected by the closures and travel restrictions in their countries. Shipyard staff and third-party experts as well as spare parts may be harder to procure and provide making the maintenance process potentially lengthier, costlier or unfeasible. Spare parts and supplies may be harder to produce and deliver to a shipyard where they would be utilized for a scheduled maintenance. In addition to the above, and always relating to COVID-19 travel restrictions, it will be difficult for our in-house technical teams to travel to the shipyards in order to monitor the maintenance process, so the maintenance may have to be postponed or 3rd party monitoring technical crews will be hired. Finally, classification society surveyor attendance may be restricted thus not only affecting the time spent within a repair facility but also causing scheduled survey work to be postponed as far as this is permissible.

Effect on the following technical department activities yet not limited to:

  1. Logistics and supply of spares and expert services may incur increased costs and disruption in Planned Maintenance and consequently lead to increased failures / incidents.

  2. Office Personnel attendance is disrupted or impossible, which can have as a result inadequate supervision and lead to increased incidents in third party inspection and reduced maintenance quality.

  3. Long-Term planned maintenance (dry docking) unsupervised by company personnel, that can result to lower quality and increased costs.

  4. Delays in class surveys, which can lead to postponements.

The above ultimately are translated to possible increased costs and reduced maintenance quality which in the long term shall spiral to cost increases again as the aftermath shall have to be dealt with. However, there are presently insufficient statistics to reach to prediction model as regards to the actual increase in costs due to the above disruptions.

The Company has evaluated the impact of current economic situation on the recoverability of the carrying amount of its vessels. During the first nine months of 2020, the Company concluded that events and circumstances triggered the existence of potential impairment of its vessels. These indicators included volatility in the charter market as well as the potential impact the current marketplace may have on the future operations. As a result, the Company performed an impairment assessment of the Company’s vessels by comparing the discounted projected net operating cash flows for each vessel to her carrying values. For the first nine months of 2020, the Company concluded that the recoverable amounts of the vessels were lower than their carrying amounts and an impairment loss of $4.6 million was recorded. For the first nine months of 2021 the Company re-evaluated the carrying amount of its vessels and concluded that no further impairment of its vessels should be recorded or previously recognized impairment should be reversed.

Results of Operations

Third quarter of the year 2021 compared to the third quarter of the year 2020

Total comprehensive income for the third quarter of the year 2021 amounted to $5.6 million or $0.27 basic and diluted income per share based on 20,467,086 weighted average number of shares, compared to total comprehensive loss of $1.3 million for the same period last year or $0.8 basic and diluted loss per share based on 1,574,877 weighted average number of shares.

The following table corresponds to the breakdown of the factors that led to the increase in total comprehensive income during the third quarter of 2021 compared to the third quarter of 2020 (expressed in $000’s):

3rd Quarter of 2021 vs 3rd Quarter of 2020

Net loss for the 3rd quarter of 2020

(1,267

)

Increase in Voyage revenues

9,494

Increase in Management and consulting fee income

78

Increase in Voyage expenses

(297

)

Increase in Vessels operating expenses

(1,551

)

Increase in Depreciation

(639

)

Increase in Depreciation of dry-docking costs

(510

)

Increase in Total administrative expenses

(228

)

Increase in Other income, net

23

Decrease in Interest income

(1

)

Decrease in Interest expense and finance costs

523

Decrease in Gain on derivative financial instruments

(156

)

Decrease in Foreign exchange losses

107

Net income for the 3rd quarter of 2021

5,576

Voyage revenues
During the three-month period ended September 30, 2021, and 2020, our Voyage revenues reached $12.7 million and $3.2 million, respectively. The 297% increase in Voyage revenues was mainly attributed to the increase in the average time charter rates achieved by our vessels during the third quarter of 2021 compared to the same period in 2020. Daily Time Charter Equivalent rate (TCE) for the third quarter of 2021 was $17,057 per vessel per day against $6,404 per vessel per day during the same period in 2020 corresponding to an increase of 166%.

Management and consulting fee income
On July 15, 2021, the Company entered into a consultancy agreement with Eolos Shipmanagement S.A., a related party, for the purpose of providing consultancy services to Eolos Shipmanagement S.A. For these services the Company receives a daily fee of $1,000. The total income from these fees is classified in the income statement component of the consolidated statement of comprehensive income/(loss) under management and consulting fee income.

Voyage expenses
Voyage expenses reached $0.5 million during the third quarter of 2021 compared to $0.2 during the same period in 2020. Voyage expenses include commissions on revenues, port and other voyage expenses and bunker expenses. Bunker expenses mainly refer to the cost of bunkers consumed during periods that our vessels are travelling seeking employment. Voyage expenses for the third quarter of 2021 and 2020 are analyzed as follows:

In $000’s

2021

2020

Commissions

181

47

Bunkers expenses

131

190

Other voyage expenses

222

-

Total

534

237

This increase is mainly attributed to the increase of the fleet to average of 7.8 vessels during the three-month period ended September 30, 2021, compared to average of 5 vessels during the same period in 2020.

Vessel operating expenses
Vessel operating expenses, which include crew costs, provisions, deck and engine stores, lubricating oils, insurance, maintenance, and repairs, increased by $1.6 million or 80% to $3.6 million during the three-month period ended September 30, 2021, compared to $2 million during the same period in 2020. This increase is mainly attributed to the increase of the fleet to average of 7.8 vessels during the three-month period ended September 30, 2021, compared to average of 5 vessels during the same period in 2020.
The breakdown of our operating expenses for the quarters ended September 30, 2021 and 2020 was as follows:

2021

2020

Crew expenses

60

%

55

%

Repairs and spares

12

%

19

%

Insurance

9

%

8

%

Stores

12

%

10

%

Lubricants

4

%

5

%

Other

3

%

3

%

Average daily operating expenses during the three-month periods ended September 30, 2021 and 2020 were $4,981 per vessel per day and $4,391 per vessel per day respectively, corresponding to an increase of 13%. The increased daily operating expenses during the third quarter of 2021 is mainly attributed to crew matters such as more frequent repatriations, rotations that come with increased travelling, testing and quarantine compliance costs, that could not be performed during the same period in 2020 as most countries were on lockdown due to COVID-19.

Depreciation
Depreciation charge during the third quarter of 2021 reached $1.2 million compared to $0.6 million during the same period in 2020. This is mainly attributed to the increase of the fleet from average of 5 vessels during the three-month period ended September 30, 2020 to average of 7.8 vessels for the same period in 2021.

Interest expense and finance costs
Interest expense and finance costs reached $0.4 million for the third quarter of 2021 compared to $0.9 million for the same period of 2020. Interest expense and finance costs for the third quarter of 2021 and 2020 are analyzed as follows:

In $000’s

2021

2020

Interest payable on long-term borrowings

334

836

Bank charges

8

7

Operating lease liability interest

(24

)

11

Amortization of debt discount

38

75

Loss on Interest rate Swap

57

-

Other finance expenses

4

11

Total

417

940

The decrease in interest payable is mainly attributed to the decrease of the weighted interest rate, which is attributed to the refinance of the EnTrust loan facility with CiT loan facility in May 2021. The EnTrust loan facility had a margin of 8.50% (plus Libor) whereas the CiT loan facility has a margin of 3.75% (plus Libor).

Nine-month period ended September 30, 2021, compared to the nine-month period ended September 30, 2020

Total comprehensive income for the nine-month period ended September 2021 amounted to $4.8 million or $0.37 basic income per share based on 12,865,496 weighted average number of shares, compared to total comprehensive loss of $14.5 million for the same period last year or $24.76 basic and diluted loss per share based on 584,158 weighted average number of shares.

The following table corresponds to the breakdown of the factors that led to the decrease in total comprehensive loss during the nine-month period ended September 30, 2021, compared to the nine-month period ended September 30, 2020, (expressed in $000’s):

9-month period of 2021 vs 9-month period of 2020

Net loss and total comprehensive loss for the 9-month period of 2020

(14,466

)

Increase in voyage revenues

16,901

Increase in management and consulting fee income

78

Decrease in Voyage expenses

1,384

Increase in Vessels operating expenses

(3,573

)

Increase in Depreciation

(956

)

Increase in Depreciation of dry-docking costs

(768

)

Increase in Total administrative expenses

(608

)

Decrease in Impairment loss

4,615

Increase in Other income, net

143

Decrease in Interest income

(7

)

Decrease in Interest expense and finance costs

255

Decrease in Loss on derivative financial instruments

1,646

Decrease in Foreign exchange loss

143

Net income and total comprehensive income for the 9-month period of 2021

4,787

Voyage revenues
During the nine-month periods ended September 30, 2021 and 2020, our Voyage revenues reached $24.7 million and $7.8 million respectively. The 217% increase in Voyage revenues was mainly attributed to the increase in the average time charter rates achieved by our vessels during the nine-month period ended September 30, 2021, compared to the same period in 2020. Furthermore, the Company operated a fleet of average 6.7 vessels during the first nine months of 2021 compared to 5 vessels for the same period in 2020. Daily Time Charter Equivalent rate (TCE) for the nine-month period of 2021 was $13,325 per vessel per day against $4,191 per vessel per day during the same period in 2020 corresponding to an increase of 218%, which is attributed to the better conditions throughout the bulk market for the first nine months of 2021 compared with the low rates in the first nine months of 2020, which was mainly attributed to the outbreak of COVID-19 pandemic.

Management and consulting fee income
On July 15, 2021, the Company entered into a consultancy agreement with Eolos Shipmanagement S.A., a related party, for the purpose of providing consultancy services to Eolos Shipmanagement S.A. For these services the Company receives a daily fee of $1,000. The total income from these fees is classified in the income statement component of the consolidated statement of comprehensive income/(loss) under management & consulting fee income.

Voyage expenses
Voyage expenses reached $0.8 million during the nine-month period ended September 30, 2021, compared to $2.2 million during the same period last year. Voyage expenses include commissions on revenues, port and other voyage expenses and bunker expenses. Bunker expenses mainly refer to the cost of bunkers consumed during periods that our vessels are travelling seeking employment. Voyage expenses for the nine-month periods ended September 30, 2021 and 2020, are analyzed as follows:

In $000’s

2021

2020

Commissions

366

108

Bunkers expenses

44

2,035

Other voyage expenses

418

69

Total

828

2,212

This decrease is mainly attributed to the decreased ballasting days of the fleet during the nine-month period ended September 30, 2021, compared to the same period in 2020.

Vessel operating expenses
Vessel operating expenses, which include crew costs, provisions, deck and engine stores, lubricating oils, insurance, maintenance, and repairs, reached $9.6 million during the nine-month period ended September 30, 2021, compared to $6.1 million during the same period last year. This is partly attributed to the fact that the average number of vessels of the fleet of the Company has increased to average of 6.7 vessels during the first nine months of 2021 compared to an average of 5 vessels for the same period in 2020. The breakdown of our operating expenses for the nine-month period ended September 30, 2021 and 2020 was as follows:

2021

2020

Crew expenses

56

%

56

%

Repairs and spares

18

%

18

%

Insurance

8

%

8

%

Stores

11

%

10

%

Lubricants

4

%

5

%

Other

3

%

3

%

Average daily operating expenses during the nine-month periods ended September 30, 2021 and 2020, were $5,278 per vessel per day and $4,422 per vessel per day respectively, corresponding to an increase of 19%. The increased daily operating expenses during the first nine months of 2021 is mainly attributed to crew matters such as more frequent repatriations, rotations that come with increased travelling, testing and quarantine compliance costs, that could not be performed during the same period in 2020 as most countries were on lockdown due to COVID-19. Furthermore, during the period under consideration the Company had increased expenses for repairs and maintenance, compared to the nine-month period ended September 30, 2020.

Depreciation
Depreciation charge during the nine-month period ended September 30, 2021, reached $2.7 million compared to $1.7 million during the same period in 2020. This is mainly attributed to the increase of the fleet from 5 vessels during the nine-month period ended September 30, 2020, to 6.7 vessels for the same period in 2021. Nonetheless, this increase has been counterbalanced due to the impairment loss of $4.6 million, recognized in the 1st quarter of 2020, which reduced the carrying amount of the fleet.

Total administrative expenses
Total administrative expenses, including administrative expenses to related parties and share bases payments, increased to $2.3 million during the nine-month period ended September 30, 2021, compared to $1.7 million in 2020. The increase is partly attributed to new personnel hirings, as a result of the fleet expansion from 5 vessels as at September 30, 2020, to 8 vessels as at September 30, 2021. As at November 29, 2021, the Company also took delivery of its 9th vessel, the m/v “Orion Globe”.

Impairment loss
During the first nine months of 2020, the Company concluded that the recoverable amounts of its vessels were lower than their respective carrying amounts and recognized an impairment loss of $4.6 million. No impairment was recorded during the first nine months of 2021.

Interest expense and finance costs
Interest expense and finance costs reached $2.9 million during the nine-month period ended September 30, 2021, compared to $3.2 million in 2020. Interest expense and finance costs for the nine-month periods ended September 30, 2021 and 2020, are analyzed as follows:

In $000’s

2021

2020

Interest payable on long-term borrowings

1,637

2,897

Bank charges

50

19

Operating lease liability interest

34

34

Amortization of debt discount

509

216

Other finance expenses

608

16

Interest and Accrued Interest on Interest rate Swap

89

-

Total

2,927

3,182

As at September 30, 2021, and 2020, we and our vessel-owning subsidiaries had outstanding borrowings under our Loan agreements of an aggregate of $33 and $37 million, respectively, gross of unamortized debt discount. The decrease in interest payable is partly attributed to the decreased outstanding balance of the Company’s Loan facilities and partly attributed to the decrease of the weighted interest rate from 9.66% during the nine-month period ended September 30, 2020, to 6.26% for the same period in 2021, which is mainly attributed to the refinance of the EnTrust loan facility with CiT loan facility on May 2021. The EnTrust loan facility had a margin of 8.50% (plus Libor) whereas the CiT loan facility has a margin of 3.75% (plus Libor). Other finance expenses for the first nine months of 2021 include approximately $0.6 million that were the loan prepayment fee and expenses relating to the prepayment of EnTrust loan facility.

Loss on derivative financial instruments
For the period ended September 30, 2020, the loss on the derivative financial instruments is mainly attributed to the valuation of the “Convertible Note” (as defined in note 11 of the Company’s 2020 Annual Report). Further to the conversion clause included into the Convertible Note for the period ended September 30, 2020 a total amount of approximately $1.2 million, principal and accrued interest, was converted to share capital with the conversion price of $100 per share and a total number of 11,677 new shares issued in name of the holder of the Convertible Note. These conversions resulted to a loss of approximately $0.3 million recognized in the consolidated statement of comprehensive income/(loss). Furthermore, with the repayment of the Convertible Note on June 25, 2020, we recognized a loss of $1.3 million in the consolidated statement of comprehensive income/(loss).

Following the new loan facility with CiT Bank N.A. the Company entered into an Interest Rate Swap agreement on May 10, 2021, and recognized a loss of $162 thousand in the consolidated statement of comprehensive income/(loss). As at September 30, 2021, the Company recognized a gain of approximately $161 thousand according to the Interest Rate Swap valuation and is included in the consolidated statement of comprehensive income/(loss).

Capital resources
As at September 30, 2021, and December 31, 2020, our cash and bank balances and bank deposits (including restricted cash) were $67.9 and $21.1 million, respectively.

Net cash generated from operating activities for the three-month period ended September 30, 2021, was $5.8 million compared to net cash used in operating activities of $0.6 million during the respective period in 2020. The increase in our cash from operations was mainly attributed to the increase in our Voyage revenues from $3.2 million during the third quarter of 2020 to $12.7 million during the three-month period under consideration.

Net cash generated from operating activities for the nine-month period ended September 30, 2021, was $7.9 million compared to net cash used in operating activities of $4.6 million during the respective period in 2020. The increase in our cash generated from operating activities was mainly attributed to the increase in our Voyage revenues from $7.8 million during the nine-month period ended September 30, 2020 to $24.7 million during the nine-month period under consideration.

Net cash used in investing activities for the three-month period ended September 30, 2021, was $14.7 million compared to $54 thousand during the respective period in 2020. The increase in our cash used in investing activities was mainly attributed to the payment of the remaining balance for the purchase of m/v “Power Globe”, amounting to $14.6 million during the three-month period ended September 30, 2021.

Net cash used in investing activities for the nine-month period ended September 30, 2021, was $43.4 million compared to net cash used in investing activities of $42 thousand during the respective period in 2020. The increase in our cash used in investing activities was mainly attributed to the acquisition of m/v “Diamond Globe”, amounting to $27 million, and the acquisition of m/v “Power Globe”, amounting to $16.2 million during the nine-month period ended September 30, 2021.

Net cash (used in)/generated from financing activities during the three-month and nine-month periods ended September 30, 2021 and 2020 were as follows:

Three months ended
September 30,

Nine months ended
September 30,

In $000’s

2021

2020

2021

2020

Proceeds from issuance of share capital

-

13,950

89,580

38,158

Proceeds from issuance of warrants

5

-

25

194

Transaction costs on issue of new common shares

-

(355

)

(401

)

(888

)

Proceeds from loans

-

-

34,250

-

Repayment of long-term debt

(1,250

)

-

(2,743

)

-

Prepayment of long-term debt

-

(800

)

(35,507

)

(3,040

)

Increase in restricted cash

(742

)

(356

)

(2,417

)

(439

)

Repayment of lease liability

(86

)

(160

)

(166

)

(160

)

Interest paid

(406

)

(1,467

)

(2,179

)

(3,195

)

Payment of financing costs

-

-

(545

)

-

Net cash (used in)/generated from financing activities

(2,479

)

10,812

79,897

30,630

As at September 30, 2021 and 2020, we and our vessel-owning subsidiaries had outstanding borrowings under our Loan agreements of an aggregate of $33 million and $37 million, respectively, gross of unamortized debt discount.

Selected Consolidated Financial & Operating Data

Three months ended

Nine months ended

September 30,

September 30,

2021

2020

2021

2020

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

(unaudited)

(unaudited)

Consolidated statement of comprehensive income / (loss) data:

Voyage revenues

12,677

3,183

24,763

7,772

Management and consulting fee income

78

-

78

-

Total Revenues

12,755

3,183

24,751

7,772

Voyage expenses

(534

)

(237

)

(828

)

(2,212

)

Vessel operating expenses

(3,571

)

(2,020

)

(9,631

)

(6,058

)

Depreciation

(1,189

)

(549

)

(2,681

)

(1,725

)

Depreciation of dry-docking costs

(731

)

(222

)

(1,846

)

(1,078

)

Administrative expenses

(708

)

(538

)

(1,783

)

(1,358

)

Administrative expenses payable to related parties

(153

)

(95

)

(462

)

(184

)

Share-based payments

(10

)

(10

)

(30

)

(30

)

Impairment loss

-

-

-

(4,615

)

Other income, net

35

11

158

12

Operating profit/(loss)

5,894

(477

)

7,648

(9,571

)

Interest income

2

3

5

15

Interest expense and finance costs

(417

)

(940

)

(2,927

)

(3,182

)

Gain/(Loss) on derivative financial instruments

64

221

(1

)

(1,647

)

Foreign exchange gains/(losses), net

33

(74

)

62

(81

)

Total finance costs, net

(318

)

(790

)

(2,861

)

(4,895

)

Total comprehensive income / (loss) for the period

5,576

(1,267

)

4,787

(14,466

)

Basic and diluted earnings / (loss) per share for the period (1)

0.27

(0.80

)

0.37

(24.76

)

Adjusted EBITDA (2)

7,814

294

12,175

(2,153

)

(1) Shares and per share data give effect to the 1‐for‐100 reverse stock split, effective on October 21, 2020. The weighted average number of shares for the nine-month period ended September 30, 2021 was 12,865,496 compared to 584,158 shares for the nine-month period ended September 30, 2020. The weighted average number of shares for the three-month period ended September 30, 2021 was 20,467,086 compared to 1,574,877 shares for the three-month period ended September 30, 2020.

(2) Adjusted EBITDA represents net earnings before interest and finance costs net, gains or losses from the change in fair value of derivative financial instruments, foreign exchange gains or losses, income taxes, depreciation, depreciation of dry-docking costs, amortization of fair value of time charter acquired, impairment and gains or losses on sale of vessels. Adjusted EBITDA does not represent and should not be considered as an alternative to total comprehensive income/(loss) or cash generated from operations, as determined by IFRS, and our calculation of Adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is not a recognized measurement under IFRS.

Adjusted EBITDA is included herein because it is a basis upon which we assess our financial performance and because we believe that it presents useful information to investors regarding a company’s ability to service and/or incur indebtedness and it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under IFRS. Some of these limitations are:

  • Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

  • Adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;

  • Adjusted EBITDA does not reflect changes in or cash requirements for our working capital needs; and

  • Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered a measure of discretionary cash available to us to invest in the growth of our business.

The following table sets forth a reconciliation of Adjusted EBITDA to total comprehensive loss and net cash used in operating activities for the periods presented:

Three months ended

Nine months ended

September 30,

September 30,

(Expressed in thousands of U.S. dollars)

2021

2020

2021

2020

(Unaudited)

(Unaudited)

Total comprehensive income/(loss) for the period

5,576

(1,267

)

4,787

(14,466

)

Interest and finance costs, net

417

940

2,927

3,182

Interest income

(2

)

(3

)

(5

)

(15

)

(Gain)/Loss on derivative financial instruments

(64

)

(221

)

1

1,647

Foreign exchange (gains)/losses, net

(33

)

74

(62

)

81

Depreciation

1,189

549

2,681

1,725

Depreciation of dry-docking costs

731

222

1,846

1,078

Impairment loss

-

-

-

4,615

Adjusted EBITDA

7,814

294

12,175

(2,153

)

Share-based payments

10

10

30

30

Payment of deferred dry-docking costs

(451

)

(491

)

(2,676

)

(984

)

Net decrease/(increase) in operating assets

(328

)

(492

)

351

(127

)

Net (increase)/decrease in operating liabilities

(1,198

)

58

(1,917

)

(1,356

)

Provision for staff retirement indemnities

1

1

(9

)

4

Foreign exchange gains/(losses) net, not attributed to cash & cash equivalents

5

(24

)

(19

)

(27

)

Net cash generated from/(used in) operating activities

5,853

(644

)

7,935

(4,613

)


Three months ended

Nine months ended

September 30,

September 30,

(Expressed in thousands of U.S. dollars)

2021

2020

2021

2020

(Unaudited)

(Unaudited)

Statement of cash flow data:

Net cash generated from / (used in) operating activities

5,853

(644

)

7,935

(4,613

)

Net cash used in investing activities

(14,710

)

(54

)

(43,435

)

(42

)

Net cash (used in) / generated from financing activities

(2,479

)

10,812

79,897

30,630


As at September 30,

As at December 31,

(Expressed in thousands of U.S. Dollars)

2021

2020

(Unaudited)

Consolidated condensed statement of financial position:

Vessels, net

102,889

62,350

Other non-current assets (including non-current restricted cash)

4,775

1,810

Total non-current assets

107,664

64,160

Cash and cash equivalents (including current restricted cash)

64,404

19,853

Other current assets

2,077

2,428

Total current assets

66,481

22,281

Total assets

174,145

86,441

Total equity

136,245

42,094

Total debt net of unamortized debt discount

32,516

36,552

Other liabilities

5,384

7,795

Total liabilities

37,900

44,347

Total equity and liabilities

174,145

86,441

Consolidated statement of changes in equity:

(Expressed in thousands of U.S. Dollars)

Issued share

Share

(Accumulated

Total

Capital

Premium

Deficit

)

Equity

As at December 31, 2020

12

195,102

(153,020

)

42,094

Total comprehensive income for the period

-

-

4,787

4,787

Issuance of common shares

60

89,520

-

89,580

Issuance of new common shares due to exercise of Warrants

10

15

-

25

Issuance of Class B preferred shares

-

130

-

130

Transaction costs on issue of new common shares

-

(401

)

-

(401

)

Share-based payments

-

30

-

30

As at September 30, 2021

82

284,396

(148,233

)

136,245

Operational data

Three months ended
September 30,

Nine months ended
September 30,

2021

2020

2021

2020

Ownership days (1)

717

460

1,825

1,370

Available days (2)

712

460

1,790

1,327

Operating days (3)

696

436

1,738

1,292

Fleet utilization (4)

97.8%

94.7%

97.1%

97.4%

Average number of vessels (5)

7.8

5.0

6.7

5.0

Daily time charter equivalent (TCE) rate (6)

$17,057

$6,404

$13,325

$4,191

Daily operating expenses (7)

$4,981

$4,391

$5,278

$4,422

Notes:

(1)

Ownership days are the aggregate number of days in a period during which each vessel in our fleet has been owned by us.

(2)

Available days are the number of ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys.

(3)

Operating days are the number of available days less the aggregate number of days that the vessels are off-hire due to any reason, including unforeseen circumstances but excluding days during which vessels are seeking employment.

(4)

We calculate fleet utilization by dividing the number of operating days during a period by the number of available days during the period.

(5)

Average number of vessels is measured by the sum of the number of days each vessel was part of our fleet during a relevant period divided by the number of calendar days in such period.

(6)

TCE rates are our voyage revenues less net revenues from our bareboat charters less voyage expenses during a period divided by the number of our available days during the period which is consistent with industry standards. TCE is a measure not in accordance with GAAP.

(7)

We calculate daily vessel operating expenses by dividing vessel operating expenses by ownership days for the relevant time period.

Voyage Revenues to Daily Time Charter Equivalent (“TCE”) Reconciliation

(Expressed in thousands of U.S. Dollars, except TCE rate)

Three months ended
September 30,

Nine months ended
September 30,

2021

2020

2021

2020

(Unaudited)

(Unaudited)

Voyage revenues

12,677

3,183

24,673

7,772

Less: Voyage expenses

534

237

828

2,212

Net revenues

12,143

2,946

23,845

5,560

Available days net of bareboat charter days

712

460

1,790

1,327

Daily TCE rate (1)

$17,057

$6,404

$13,325

$4,191

(1) Subject to rounding.

About Globus Maritime Limited

Globus is an integrated dry bulk shipping company that provides marine transportation services worldwide and presently owns, operates and manages a fleet of nine dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina and other dry bulk cargoes internationally. Globus’ subsidiaries own and operate nine vessels with a total carrying capacity of 626,257 Dwt and a weighted average age of 10.1 years as at November 30, 2021.

Safe Harbor Statement

This communication contains “forward-looking statements” as defined under U.S. federal securities laws. Forward-looking statements provide the Company’s current expectations or forecasts of future events. Forward-looking statements include statements about the Company’s expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts or that are not present facts or conditions. 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. 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. The Company’s actual results could differ materially from those anticipated in forward-looking statements for many reasons specifically as described in the Company’s filings with the Securities and Exchange Commission. Accordingly, you should not unduly rely on these forward-looking statements, which speak only as at the date of this communication. Globus 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 Globus describes in the reports it will file from time to time with the Securities and Exchange Commission after the date of this communication.

For further information please contact:

Globus Maritime Limited

+30 210 960 8300

Athanasios Feidakis, CEO

a.g.feidakis@globusmaritime.gr

Capital Link – New York

+1 212 661 7566

Nicolas Bornozis

globus@capitallink.com


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