Performance Shipping (US:PSHG)2023-04-28 00:44Financial Performance - For the year ended December 31, 2022, the company reported revenue of $75.173 million, a significant increase from $36.491 million in 2021[381]. - Revenue for 2022 was $75.2 million, a 106.0% increase from $36.5 million in 2021[418]. - Net income from continuing operations for 2022 was $36.3 million, compared to a net loss of $10.1 million in 2021, reflecting an improvement of $46.4 million[420]. - Net cash provided by operating activities in 2022 was $33.8 million, a substantial increase compared to a net cash used of $3.1 million in 2021, driven by higher revenues in the tanker shipping industry[437]. Operational Efficiency - Fleet utilization reached 96.8% for the year ended December 31, 2022, up from 85.5% in 2021, indicating enhanced operational efficiency[381]. - Daily operating expenses decreased slightly to $6,683 in 2022 from $6,740 in 2021, demonstrating effective cost management[381]. - The company incurred total voyage expenses of $14.861 million in 2022, down from $19.205 million in 2021, contributing to improved profitability[381]. - Voyage expenses decreased to $14.9 million in 2022 from $19.2 million in 2021, a reduction of 22.4%[423]. Fleet and Capacity - Ownership days increased to 2,069 in 2022 from 1,825 in 2021, indicating fleet growth and increased capacity[381]. - The total carrying value of vessels as of December 31, 2022, was $238.2 million, compared to $125.3 million in 2021[404]. - The aggregate carrying value of four tanker vessels exceeded their aggregate charter-free market values by approximately $119.9 million as of December 31, 2022[400]. - The company has transitioned to a fleet primarily operating on time charters, which provide more predictable cash flows[386]. Debt and Financing - As of December 31, 2022, the company's aggregate outstanding debt was $128.5 million, which will be managed through regular operating and financing activities[393]. - The company expects to make debt amortization payments of $16.5 million and dividends of $1.9 million in the upcoming 12 months[435]. - As of December 31, 2022, the company had $128.5 million of long-term debt outstanding under bank loan facilities, with variable interest rates ranging from 2.35% to 2.85%[444][445]. - The weighted average interest rate of bank loan facilities increased from 2.90% in 2021 to 4.85% in 2022 due to rising LIBOR and SOFR rates[597]. Market Conditions - Global crude oil demand increased by 2.2% in 2022 and is projected to rise by 1.8% in 2023, reaching 101.4 million barrels per day[466]. - The ongoing conflict between Russia and Ukraine has caused significant shifts in crude oil trade patterns, supporting tanker charter rates[469]. - The company's revenues improved in 2022 due to higher OPEC+ production and increased ton mile from sanctions on Russian crude oil exports[473]. Executive Compensation and Personnel - In 2022, the aggregate fees and bonuses for executives amounted to $2.1 million[495]. - Non-executive directors received annual compensation of $30,000 plus expenses, with the chairman receiving $60,000 and committee chairmen receiving an additional $10,000[497]. - The total number of shoreside personnel increased from 25 in 2021 to 30 in 2022, while seafaring personnel rose from 127 in 2021 to 197 in 2022[512]. Risk Factors - The company faces counterparty risk in charter agreements, which could impact financial performance if charterers fail to meet their obligations[387]. - Elevated inflation and interest rate increases are expected to impact operating expenses and the cost of capital for the company[475]. - The company has not yet experienced adverse financial effects from the COVID-19 pandemic or the war in Ukraine as of December 31, 2022[474]. Accounting and Financial Instruments - Time charter revenues are accounted for over the term of the charter as the service is provided, reflecting the company's revenue recognition policy[411]. - The company has not used any derivative instruments for hedging purposes as of the report date[444]. - The company may consider using financial derivatives in the future to mitigate exchange rate risks, although it currently does not engage in such instruments[601].