FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of August 2005
TOP TANKERS INC.
(Translation of registrant's name into English)
109-111 Messogion Avenue
Politia Centre
Athens 115 26 GR
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.
Form 20-F [X] Form 40-F [_]
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes [_] No [X]
Item 1. INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached as Exhibit 1 is a copy of the press release issued by TOP
Tankers Inc. (the "Company") of the Company's financial results for the second
quarter and the first half of 2005. This report on Form 6K is hereby
incorporated by reference to the registration statement of Form F-3 filed on
August 1, 2005 (file No. 333-127086).
EXHIBIT 1
---------
TOP TANKERS INC.
NEWS RELEASE for August 4, 2005 at 7:35 AM EDT
Contact: Michael Mason (investors) Stamatis Tsantanis, CFO
Allen & Caron Inc TOP Tankers Inc
212 691 8087 011 30 210 697 8199
michaelm@allencaron.com snt@toptankers.com
TOP TANKERS REPORTS SECOND QUARTER AND
FIRST HALF 2005 FINANCIAL RESULTS
ATHENS, GREECE (August 4, 2005) ... TOP Tankers Inc (NasdaqNM:TOPT) today
announced operating results for the second quarter and first half of 2005.
For the three months ended June 30, 2005, the Company reported net income of
$13,552,000, or $0.49 per share, compared with net income of $5,709,000, or
$0.95 per share, for the second quarter of 2004. The weighted average number of
basic and diluted shares used in the computations was 27,830,990 and 6,000,000
for the second quarter of 2005 and 2004 respectively. For the three months ended
June 30, 2005, operating income was $19,200,000, compared with $6,486,000 for
the second quarter of 2004. EBITDA(1) for the second quarter of 2005 was
$33,128,000, compared with $8,999,000 for previous year's second quarter. Voyage
revenues for the second quarter of 2005 were $56,329,000, compared to
$17,428,000 recorded for the second quarter of the previous year.
For the six months ended June 30, 2005, TOP Tankers reported net income of
$32,673,000, or $1.17 per share, compared to $6,953,000, or $1.16 per share, for
the first half of 2004. The weighted average number of basic and diluted shares
used in the computations was 27,830,990 and 6,000,000 for the first half of 2005
and 2004 respectively. For the six-month period ended June 30, 2005, operating
income was $40,175,000, compared with $8,084,000 for the first half of 2004.
EBITDA for the first six months of 2005 was $62,847,000, compared to $12,035,000
for the same period last year. Voyage revenues for the six month period ended
June 30, 2005, were $103,620,000, compared to $25,156,000 recorded for the first
half of 2004.
Evangelos J. Pistiolis, President and Chief Executive Officer of TOP Tankers
Inc, commented, "We have entered the summer period, typically the season for low
rate especially for crude oil tankers. Still, despite the decline in crude oil
tanker-charter rates compared to last year, we are still experiencing a strong
rate environment, which we consider very promising for the remainder of 2005."
----------
1 EBITDA represents earnings before interest, taxes, depreciation and
amortization. EBITDA does not represent and should not be considered as an
alternative to net income or cash flow from operations, as determined by
GAAP, and our calculation of EBITDA may not be comparable to that reported
by other companies. EBITDA is included in this press release because it is
a basis upon which we assess our liquidity position and because we believe
that it presents useful information to investors regarding our ability to
service and/or incur indebtedness.
TOP TANKERS REPORTS 2nd QUARTER AND FIRST HALF 2005 FINANCIAL RESULTS
The following key indicators serve to highlight changes in the Company's fleet
financial performance during the second quarters and six-month periods ended
June 30, 2004 and 2005:
Suezmax Fleet
Three Months Ended June 30, Six Months Ended June 30,
(In U.S. Dollars unless otherwise stated) 2004 2005 Change 2004 2005 Change
--------------------------------------------------------
Total available ship days 182 791 334.6% 200 1,207 503.5%
Total operating days 176 687 290.3% 192 1,099 472.4%
Utilization 96.7% 86.9% -10.2% 96.0% 91.1% -5.2%
Time Charter Equivalent (TCE) per ship per day
under spot voyage charter 38,534 40,209 4.3% 37,464 44,716 19.4%
TCE per ship per day under time charter - 32,195 - - 32,195 -
Average TCE 38,534 37,223 -3.4% 37,464 41,800 11.6%
Vessel operating expenses per ship per day 5,665 7,818 38.0% 6,450 7,395 14.7%
Handymax Fleet
Three Months Ended June 30, Six Months Ended June 30,
(In U.S. Dollars unless otherwise stated) 2004 2005 Change 2004 2005 Change
--------------------------------------------------------
Total available ship days 182 1,230 575.8% 364 2,147 489.8%
Total operating days 182 1,138 525.3% 360 2,048 468.9%
Utilization 100.0% 92.5% -7.5% 98.9% 95.4% -3.5%
TCE per ship per day under spot voyage charter - 11,500 - - 11,500 -
TCE per ship per day under time charter 13,407 19,859 48.1% 13,382 20,633 54.2%
Average TCE 13,407 19,536 45.7% 13,382 20,437 52.7%
Vessel operating expenses per ship per day 4,137 5,149 24.5% 4,442 5,055 13.8%
Total Fleet
Three Months Ended June 30, Six Months Ended June 30,
(In U.S. Dollars unless otherwise stated) 2004 2005 Change 2004 2005 Change
--------------------------------------------------------
Total available ship days 637 2,112 231.6% 1,110 3,535 218.5%
Total operating days 622 1,916 208.0% 1,091 3,317 204.0%
Utilization 97.6% 90.7% -7.1% 98.3% 93.8% -4.5%
TCE per ship per day under spot voyage charter 23,089 37,539 62.6% 19,640 40,451 106.0%
TCE per ship per day under time charter 13,407 21,176 57.9% 12,880 21,314 65.5%
Average TCE 20,256 25,232 24.6% 17,118 26,875 57.0%
Vessel operating expenses per ship per day 4,523 5,822 28.7% 4,807 5,766 19.9%
General and administrative expenses per ship per day 1,129 1,433 26.9% 1,245 1,699 36.5%
TOP TANKERS REPORTS 2nd QUARTER AND FIRST HALF 2005 FINANCIAL RESULTS
FLEET REPORT
As of June 30, 2005, the Company's fleet size was 23 vessels, or 2.0 million
dwt, up from seven vessels, or 0.45 million dwt, on June 30, 2004. During the
second quarter of 2005, the Company took delivery of two double-hull Suezmax
tankers and two double-hull product tankers.
On July 13, 2005, the Company sold the M/T Fearless to a third party. The
expected gain of approximately $10 million will be recognized in the third
quarter of 2005.
On August 3, 2005, the Company announced the sale of the handymax tankers M/T
Restless and M/T Sovereign and their immediate leaseback to the Company for a
period of seven years. The lease is a bareboat charter, with TOP Tankers
performing the operational and commercial management of the vessels.
The Company expects to generate a gain of approximately $7.0 million, which will
be amortized over the seven year lease period. The bareboat charter rate is
$11,600 per ship per day and both vessels will continue their time charter
contracts with Vitol and Glencore for their remaining period of two and four
years respectively. The Company believes this sale and leaseback qualifies as an
operational lease under the U.S. GAAP.
FLEET DEPLOYMENT
During the second quarter of 2005, the Company had approximately 70 percent of
the fleet's net operating days on long-term employment contracts. The Company
announced on June 24, 2005, the signing of a new employment agreement for a
Suezmax tanker. On July 13, the Company also announced that it sold the M/T
Fearless. In total, 18 of the Company's 22 tankers will be on time- charter
contracts with an average term in excess of three years. All but two of these
time charters include profit-sharing agreements.
The Company has secured approximately 73 percent of the estimated working days
for 2005 and 78 percent for 2006 under time charter contracts. At the same time,
the four Suezmaxes operating in the spot market, together with the
profit-sharing component of the time-charter contracts, expose approximately 63
percent of the Company's estimated working days for 2005 and 49 percent for 2006
to potentially higher spot rates.
All of the Company's profit-sharing contracts settle on a quarterly basis and
the potentially generated profit is presented in the financial statements for
the corresponding period. Each settlement is full and final (except for voyages
in progress and demurrages) and does not depend on average rates of future
periods.
SUEZMAX FLEET:
During the second quarter of 2005, five of the Company's Suezmax tankers
operated in the spot market, earning on average approximately $40,209 per vessel
per day on a time-charter equivalent (TCE) basis.
During the second quarter of 2005, four of the Company's Suezmax tankers entered
into time-charter agreements:
Three Suezmax tankers entered into two-year time-charter agreements with
Glencore SA, one of the world's largest oil traders. Pursuant to these
agreements, the M/T Stopless, M/T Timeless and M/T Flawless will earn base rates
per day of $28,000 during the term of the contracts. Should a vessel generate
revenue in excess of its base rate over the duration of the contract, TOP
Tankers will receive 100 percent of the first $7,000 per day in excess of the
base rate, up to $35,000 per day, and 50 percent of the excess thereafter.
One Suezmax tanker entered into a five-year time-charter contract with Hyundai
Merchant Marine. The M/T Faultless will earn $37,000 per day during the first
two years of the time-charter contract, $36,000 per day for the third year and
$35,000 per day for the remaining two years through the expiration of the
contract.
One Suezmax tanker entered into a time charter contract with Petroleos de
Venezuela S.A. The M/T Priceless, which substituted the reported M/T Noiseless,
will earn $38,100 per day for a period of three years, and the charterers have
the option to extend the contract for an additional four-year period.
During the second quarter of 2005, the vessels under time charter earned on
average approximately $32,195 per vessel per day on a TCE basis.
HANDYMAX FLEET:
All of the Company's Handymax tankers operate under long-term employment
agreements with Glencore and Vitol that provide for a base rate and additional
profit-sharing.
Four of these contracts are with Glencore and have a base rate of $14,500 per
day. Should a vessel generate revenue in excess of its base rate over the
duration of the contract, TOP Tankers receives 100 percent of the first $500 per
day in excess of the base rate and 50 percent of the excess thereafter. The
Company extended these two-year time charter contracts by three years. The new
three-year contracts will commence immediately upon the expiration of the
current contracts. The base rates per day for the new three-year periods will be
$14,000. Should a vessel generate revenue in excess of the base rates over the
duration of these contracts, TOP Tankers will receive 100 percent of the first
$500 per day in excess of the base rate and 50 percent of the excess thereafter.
The Company has also entered into five-year employment agreements with Glencore
for all four of its double-hull Handymax tankers delivered in March and April
2005. Pursuant to these time charter agreements, the M/T Taintless, M/T
Dauntless, M/T Soundless and M/T Topless will earn a base rate of $17,000 per
day during the first year of their respective contracts. Should a vessel
generate revenue in excess of its base rate over the first year of the contract,
TOP Tankers will receive 30 percent of the excess. From the second year through
the expiration of these contracts, the base rates per day will be $16,250.
Should a vessel generate revenue in excess of its base rate per day during this
period, TOP Tankers will receive 100 percent of the first $1,000 in excess of
its base rate and 50 percent of the excess thereafter.
Six Handymax vessels have been chartered to Vitol at a base rate of $14,250 per
day until December 31, 2005, at a base rate of $13,250 per day from January 1,
2006, until expiration of the contracts in February or March of 2007, as well as
a profit-sharing provision based on the actual rate that the charterer generates
from the vessel. Under the profit sharing provision, the Company receives, on a
quarterly basis, the first $250 per day (until December 31, 2005) and the first
$1,250 per day (from January 1, 2006, until expiration of the contracts) that
the charterer generates from the vessel in excess of the base rate and 50
percent of the excess thereafter above $14,500 per day. Following the sale of
the M/T Fearless, there are five vessels chartered to Vitol.
During the second quarter of 2005, including the profit-sharing allocated to the
Company from these profit-sharing agreements, the Handymax fleet, earned on
average approximately $19,536 per vessel per day on a TCE basis.
The following table presents the Company's fleet list and the employment
agreements:
Year Daily Base Profit Sharing
Dwt Built Charter Type Expiry Rate Above Base Rate (2005)
--- ----- ------------ ------ ---- ----------------------
9 Suezmax Tankers
Timeless.............. 154,970 1991 Time Charter Q2/2007 $28,000 100% first $7,000 + 50% thereafter
Flawless.............. 154,970 1991 Time Charter Q2/2007 $28,000 100% first $7,000 + 50% thereafter
Stopless.............. 154,970 1991 Time Charter Q2/2007 $28,000 100% first $7,000 + 50% thereafter
Priceless............. 154,970 1991 Time Charter Q3/2008(A) $38,100 None
Faultless............. 154,970 1992 Time Charter Q2/2010 $37,000(1) None
Noiseless............. 149,554 1992 Spot
Stainless............. 149,599 1992 Spot
Endless............... 135,915 1992 Spot
Limitless............. 136,055 1993 Spot
14 Handymax Tankers
Victorious............ 47,084 1991 Time Charter Q3/2009 $14,500(2) 100% first $500 + 50% thereafter
Sovereign(B).......... 47,084 1992 Time Charter Q3/2009 $14,500(2) 100% first $500 + 50% thereafter
Invincible............ 47,084 1992 Time Charter Q3/2009 $14,500(2) 100% first $500 + 50% thereafter
Relentless............ 47,084 1992 Time Charter Q3/2009 $14,500(2) 100% first $500 + 50% thereafter
Vanguard.............. 47,084 1992 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Restless(B)........... 47,084 1991 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Spotless.............. 47,094 1991 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Doubtless............. 47,076 1991 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Faithful.............. 45,720 1992 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Fearless(C)........... 44,646 1992 Time Charter Q1/2007 $14,250(3) 100% first $250 + 50% thereafter
Topless............... 47,262 1998 Time Charter Q2/2010 $17,000(4) 30% above base rate
Taintless............. 46,217 1999 Time Charter Q1/2010 $17,000(4) 30% above base rate
Dauntless............. 46,168 1999 Time Charter Q1/2010 $17,000(4) 30% above base rate
Soundless............. 46,185 1999 Time Charter Q2/2010 $17,000(4) 30% above base rate
Total Tanker DWT 1,998,845
A. Charterers have option to extend contract for an additional four-year
period
B. Vessels sold on August 3 and leased back for a period of 7 years.
C. Sold on July 13, 2005
1. Base rate will change to $36,000 in the third year of the contract and
$35,000 in the fourth year until expiration.
2. Base rate will change to $14,000 in the third year of the contract until
expiration.
3. Base rate will change to $13,250 from 1/1/2006 until expiration of the
contracts, with 100 percent profit sharing participation in the first
$1,250 above base rate and 50 percent thereafter.
4. Base rate will change to $16,250 in the second year of the contract until
expiration, with 100 percent profit sharing participation in the first
$1,000 above base rate and 50 percent thereafter. MORE - MORE - MORE
CREDIT FACILITY
As of June 30, 2005, TOP Tankers had total indebtedness of $471 million,
provided by the Royal Bank of Scotland and DVB Bank, maturing in 2013 and 2012
respectively. On March 31, 2005, the Company entered into three interest
rate-swap agreements with Royal Bank of Scotland for the amounts of $93.5
million, $36.5 million and $27.9 million for a period of five, four and four
years, respectively. Under these agreements the interest rate is fixed at 4.72
percent , 4.66 percent and 4.5775 percent , respectively, in addition to the
applicable margin. The interest rate for the remaining balance of the loan is
LIBOR, plus the margin, whereas the interest rate for the DVB loan is LIBOR,
plus 1.25 percent margin. On June 30, 2005, the Company's ratio of indebtedness
to total capital was approximately 57.8 percent.
DIVIDEND
The Company paid its third quarterly dividend of $0.21 per share on July 20,
2005, to shareholders of record as of July 7, 2005. The Company also paid a
special dividend of $0.25 per share on July 27, 2005, to shareholders of record
as of July 15, 2005.
CONFERENCE CALL AND WEBCAST
TOP Tankers' management team will host a conference call on August 4, 2005, at
12:00 PM EDT. Participants should dial into the call 10-15 minutes before the
scheduled time using the following numbers: 877-407-8035 (from the US and
Canada) or +1 201-689-8035 (from outside the US and Canada). A live webcast of
the conference call will also be accessible via the Internet at
www.toptankers.com, or by going to www.vcall.com.
A telephonic replay of the conference call will be available by dialing
877-660-6853 (from the US and Canada) or 1 201-612-7415 (from outside the US and
Canada); enter account number 286 and conference ID number 163221. An online
archive will also be available immediately following the call at the sites noted
above. Both are available through August 11, 2005.
ABOUT TOP TANKERS INC
TOP Tankers Inc is an international provider of worldwide seaborne
transportation services of bulk commodities. The Company operates a fleet of 22
tankers transporting crude oil and refined petroleum products. The fleet under
management consists of nine double-hull Suezmax tankers and 13 double-hull
Handymax tankers, with a total carrying capacity of approximately 2.0 million
dwt of which 95.2 percent are sister ships. Eighteen of the Company's 22 tankers
are on time charter contracts with an average term of over three years with all
but two of the time charters including profit-sharing agreements.
FORWARD-LOOKING STATEMENTS
Matters discussed in this release may constitute forward-looking statements.
Forward-looking statements reflect our current views with respect to future
events and financial performance and may include statements concerning plans,
objectives, goals, strategies, future events or performance, and underlying
assumptions and other statements, which are other than statements of historical
facts.
The forward-looking statements in this release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, management's examination of historical operating
trends, data contained in our records and other data available from third
parties. Although TOP Tankers believes that these assumptions were reasonable
when made, because these assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to predict and
are beyond our control, TOP Tankers cannot assure you that it will achieve or
accomplish these expectations, beliefs or projections.
Important factors that, in our view, could cause actual results to differ
materially from those discussed in the forward-looking statements include the
strength of world economies and currencies, general market conditions, including
changes in charterhire rates and vessel values, failure of a seller to deliver
one or more vessels, failure of a buyer to accept delivery of a vessel,
inability to procure acquisition financing, changes in demand for oil and
petroleum products, the effect of changes in OPEC's petroleum production levels
and worldwide oil consumption and storage, changes in demand that may affect
attitudes of time charterers, scheduled and unscheduled drydocking, changes in
our voyage and operating expenses, including bunker prices, dry- docking and
insurance costs, changes in governmental rules and regulations including
requirements for double-hull tankers or actions taken by regulatory authorities,
potential liability from pending or future litigation, domestic and
international political conditions, potential disruption of shipping routes due
to accidents and political events or acts by terrorists.
Risks and uncertainties are further described in reports filed by TOP Tankers
with the US Securities and Exchange Commission.
TABLES FOLLOW
TOP TANKERS INC.
(Formerly Ocean Holdings Inc.)
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Expressed in thousands of U.S. Dollars - except for share and per share data)
Three Months Ended June 30, Six Months Ended June 30,
----------------------------- --------------------------
2004 2005 2004 2005
----------- ------------ ---------- ------------
REVENUES:
Voyage revenues 17,428 56,329 25,156 103,620
EXPENSES:
Voyage expenses 4,829 7,984 6,480 14,474
Vessel operating expenses 2,881 12,297 5,336 20,382
Depreciation and amortization 2,513 13,904 3,891 22,640
General and administrative expenses 719 3,027 1,382 6,006
Foreign currency (gains) / losses, net - (83) (17) (57)
----------- ------------ ---------- ------------
Operating income 6,486 19,200 8,084 40,175
----------- ------------ ---------- ------------
OTHER INCOME (EXPENSES):
Interest and finance costs (778) (5,894) (1,192) (8,404)
Interest income 1 222 1 870
Other, net - 24 60 32
----------- ------------ ---------- ------------
Total other expenses, net (777) (5,648) (1,131) (7,502)
----------- ------------ ---------- ------------
Net Income 5,709 13,552 6,953 32,673
=========== ============ ========== ============
Earnings per share, basic and diluted 0.95 0.49 1.16 1.17
=========== ============ ========== ============
Weighted average number of shares,
basic and diluted 6,000,000 27,830,990 6,000,000 27,830,990
EBITDA RECONCILIATION
(Expressed in Thousands of U.S Dollars) Three Months Ended June 30, Six Months Ended June 30,
---------------------------- --------------------------
2004 2005 2004 2005
----------- ----------- ---------- ------------
EBITDA 8,999 33,128 12,035 62,847
DEPRECIATION AND AMORTIZATION 2,513 13,904 3,891 22,640
INTEREST AND FINANCE COSTS, NET (777) (5,672) (1,191) (7,534)
NET INCOME 5,709 13,552 6,953 32,673
TOP TANKERS INC.
(Formerly Ocean Holdings Inc.)
CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of U.S. Dollars - except for share and per
share data)
December 31, June 30,
2004 2005
------------ -------------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 114,768 43,233
Other current assets 26,283 27,000
----------- -----------
Total current assets 141,051 70,233
FIXED ASSETS:
Advances for vessels acquisitions 25,650 -
Vessels, net 355,997 748,508
Deferred charges and other non-current assets 17,188 20,325
----------- -----------
Total assets 539,886 839,066
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt 19,540 52,509
Dividends payable 5,845 5,897
Other current liabilities 17,426 26,238
----------- -----------
Total current liabilities 42,811 84,644
LONG-TERM DEBT, net of current portion 175,266 414,224
STOCKHOLDERS' EQUITY 321,809 340,198
----------- -----------
Total liabilities and stockholders' equity 539,886 839,066
=========== -==========
TOP TANKERS INC.
(Formerly Ocean Holdings Inc.)
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Expressed in thousands of U.S. Dollars)
Six Months Ended June 30,
2004 2005
------------ -------------
Cash Flows from (used in) Operating Activities:
Net income 6,953 32,673
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 3,949 23,139
Change in operating assets and liabilities (2,594) 5,553
Payments for dry-docking - (3,238)
----------- -----------
Net Cash from Operating Activities 8,308 58,127
Cash Flows from (used in) Investing Activities:
Advances for vessels acquisitions (250) -
Acquisition of vessels and equipment (75,846) (387,400)
Other (116) -
----------- -----------
Net Cash used in Investing Activities (76,212) (387,400)
----------- -----------
Cash Flows from (used in) Financing Activities:
Proceeds from long-term debt 59,900 284,294
Payments of long-term debt (3,229) (10,000)
(Increase) decrease in restricted cash - (2,000)
Capital contributions 17,077 -
Payment of financing costs (330) (2,866)
Dividends paid (2,318) (11,690)
----------- -----------
Net Cash from Financing Activities 71,100 257,738
----------- -----------
Net increase (decrease) in cash and cash equivalents 3,196 (71,535)
Cash and cash equivalents at beginning of period 2,343 114,768
----------- -----------
Cash and cash equivalents at end of period 5,539 43,233
=========== -==========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid 1,042 4,853
=========== -==========
# # #
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TOP TANKERS INC.
(registrant)
Dated: August 10, 2005
By: /s/ Stamatis Tsantanis
--------------------------------
Stamatis Tsantanis
Chief Financial Officer
23116.0001 #593257