Performance Shipping (US:PSHG)2021-03-05 14:26Financial Performance - For the year ended December 31, 2020, ownership days increased to 1,689 from 1,516 in 2019, while operating days excluding ballast leg decreased to 1,258 from 1,401 in 2019[360]. - The Time Charter Equivalent (TCE) rate for the year ended December 31, 2020, was $18,745, up from $15,435 in 2019, reflecting a 21.5% increase[360]. - Voyage and time charter revenues for the year ended December 31, 2020, were $46,283 million, a substantial increase from $26,846 million in 2019[360]. - In 2020, the net income from continuing operations was $2.3 million, a significant improvement from a net loss of $6.8 million in 2019, driven by an increase in the tanker fleet and revenues[402]. - Voyage and time-charter revenues from continuing operations surged to $42.0 million in 2020, up 566.7% from $6.3 million in 2019, due to the full-year contribution of newly acquired vessels[399]. - The company reported a net income of $1.5 million from discontinued operations in 2020, a recovery from a net loss of $25.3 million in 2019[403]. Operational Efficiency - Fleet utilization excluding ballast leg dropped to 74.5% in 2020 from 92.4% in 2019, indicating a significant decrease in operational efficiency[360]. - Daily operating expenses decreased to $6,835 in 2020 from $7,468 in 2019, showing a reduction of approximately 8.5%[360]. - Vessel operating expenses from continuing operations increased to $9.2 million in 2020, compared to $1.1 million in 2019, primarily due to a larger fleet size[408]. - The average daily operating expenses for continuing operations rose to $6,746 in 2020 from $5,968 in 2019, influenced by COVID-19 related disruptions[408]. Debt and Financing - As of December 31, 2020, the company's aggregate outstanding debt was $58.1 million, with expectations for increased interest and finance expenses in 2021 due to higher average debt levels[371]. - Interest and finance costs from continuing operations increased to $2.1 million in 2020, up from $0.7 million in 2019, due to higher average debt levels[418]. - As of December 31, 2020, the company had $58.1 million of long-term debt outstanding under loan facilities[437]. - The outstanding balance on the Piraeus Facility was $30.0 million, drawn down from a total facility of $31.5 million[447]. Asset Valuation and Impairment - The company recorded an impairment charge of $0.3 million for one container vessel in 2020 and $31.6 million for three vessels in 2019 due to their classification as held for sale[378]. - As of December 31, 2020, the aggregate carrying value of five tanker vessels exceeded their aggregate charter-free market values by approximately $31.5 million[379]. - The net book value of the vessels increased from $82.9 million in 2019 to $128.1 million in 2020[382]. - The company evaluates the carrying amounts of vessels to determine if impairment losses are required based on future undiscounted net operating cash flows[393]. Market Outlook - The global crude oil demand is projected to rebound by 6.0% in 2021, following a severe -8.9% drop in 2020[452]. - The total trading Aframax crude tanker fleet is projected to grow by approximately 5.0% in 2021, while crude Aframax fleet capacity is expected to grow by a modest 2.5%[454]. Cash Flow and Liquidity - As of December 31, 2020, cash and cash equivalents amounted to $21.4 million, a decrease from $26.4 million in the prior year[427]. - Net cash provided by operating activities in 2020 was $13.2 million, significantly increasing from a net cash used of $4.2 million in 2019, primarily due to revenue contributions from tanker vessels[429]. - Net cash used in investing activities in 2020 was $40.1 million, which included $63.4 million for the acquisition of three tanker vessels and $23.5 million in net proceeds from the sale of two container vessels[430]. - As of December 31, 2020, the company's working capital was $17.6 million, down from $27.3 million in 2019, indicating a decrease in liquidity[425]. Currency and Risk Management - Approximately 45% of general and administrative expenses were incurred in currencies other than the U.S. dollar in 2020[589]. - The company has historically incurred around 8% of its operating expenses in currencies other than the U.S. dollar in 2020[589]. - The company does not currently consider the risk from exchange rate fluctuations to be material for its results of operations[590]. - The company may consider using derivative financial instruments in the future to manage exposure to interest rate and currency risks[590].