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Commission File No.
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 November, 2000
ENTERPRISES SHIPHOLDING CORPORATION
(Translation of registrant's name into English)
c/o Enterprises Shipping or Trading S.A.
Poseidonos Avenue 11
Elliniko GR-16777
Athens, Greece
(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
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Item 1. INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached hereto is a copy of a letter to the noteholders
of Enterprises Shipholding Corporation (the "Company") and
unaudited financial information accompanied by a Management's
Discussion and Analysis of Financial Condition and Results of
Operation for the period ended September 30, 2000.
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Athens 21st November 2000
TO THE NOTEHOLDERS OF ENTERPRISES SHIPHOLDING CORPORATION:
Enclosed is the unaudited financial information accompanied by a
Managements Discussion and Analysis of Financial Condition and
Results of Operations for the period ended September 30, 2000.
The third quarter has been as expected very poor, rates have been
down below the twenty cent level for new tonnage, correspondingly
below ten cents for the older tonnage. The fact that a lot of
pool operators have not acted responsibly to laid up tonnage has
compounded the situation and makes the future much more
uncertain. The high US dollar and fuel costs also have had their
share in negatively affecting the volume of products moving to
the Markets and the overall time charter results. Good local
growing conditions and enhanced technology, which prolong the
shelf life of the fruit and vegetables, also adversely affects
the volume of imports.
The balance of the year does not look good, and those responsible
owners who laid up tonnage are not seeing any encouragement to
break lay up.
In the nine months of 2000 the vessels that were trading in the
spot market contributed $10.1 million of revenues or 28.7% of the
total revenues compared to the nine months of 1999 where the
vessels that were trading in the spot market contributed $8.1
million of revenues or 19.8% of the total revenues. The market
during the third quarter did not yield any returns to the owners.
We anticipated this situation and in line with our previous years
strategy we laid up all our vessels with no period employment to
reduce our cost exposure. During the third quarter 16 vessels
were laid up. The remaining 8 vessels are on a period time
charter up to each vessels existing charter expiration.
The outlook of the spot market during the fourth quarter remains
very static and in line with 1999 and 1998.
The newbuilding program continues uninterrupted however we
received official notice from the yard that the delivery of the
two vessels scheduled for week 1 of 2001 will be delayed. We
received notice of delivery for the first vessel for the week 11
and the second for week 21 of 2001.This is causing a disruption
to the chartering of the vessels as the delivery will not
coincide with the beginning of the high season.
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For the nine months ending September 30, 2000, the Companys
revenues were $35.2 million, EBITDA was $14.1 million and net
income was a loss of $(11.9) million.
A conference call has been scheduled for Wednesday 22nd November
2000 at 9:30 am New York time to discuss the third quarter
results.
To participate in the conference call please dial the number
(212) 896 6035
We are pleased to answer any questions that you might have. Our
investor relations contact is: Kostas Koutsoubelis at: Tel:
Int+301+8910170 and Fax: Int+301+8983595
Sincerely yours,
Victor Restis
President and
Chief Executive Officer
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MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The Company is one of the worlds leading independent
owners and operators of reefer vessels with a fleet of 24
vessels, including 19 reefer vessels and two high reefer intake
container vessels, and three 2205 TEU geared container vessels
and has on order two combined container reefer vessels. The
following discussion presents financial information for the
Company and its subsidiaries on a consolidated basis for all
periods presented. The Company acquired such subsidiaries in
October 1997 (the Combination) in an exchange of stock
transaction. Subsequent to the Combination, the financial
statements of the Company were restated to reflect the
consolidation of all companies.
The Companys fleet currently consists of 24 vessels: (i)
19 reefer vessels ranging in size from approximately 200,000 to
600,000 cu.ft. of cargo capacity; and (ii) two reefers container
vessels, each with a cargo capacity of 324 TEU and three geared
container vessels with a cargo capacity of 2205 TEU. The
following table sets forth changes in the Companys fleet from
December 31, 1995 through September 30, 2000.
Year Ended December 31, September 30
___________________________________________
1995 1996 1997 1998 1999 2000
___________________________________________
Fleet owned at beginning of period 17 20 24 26 26 24
Newbuildings and other acquisitions
during period 3 4 2 0 1 0
Sales and dispositions during period 0 0 0 0 5 0
Fleet owned at end of period 20 24 26 26 22 24
Newbuildings on order 0 0 0 7 6 2
Reefer Cargo Capacity
(at end of period)
(millions cft.) 8.8 10.3 10.3 10.3 8.5 8.5
TEU Capacity (at end of period). 0 0 0 648 2,853 7,263
Reefer shipping is a highly specialized segment of the
global shipping industry that provides seaborne transportation of
perishable commodities, such as bananas, other fruits, meat,
seafood, vegetables and dairy products, in a temperature
controlled environment. The reefer industry is comprised of
approximately 20 leading participants and numerous medium to
small reefer fleet owners and operators.
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Reefer vessels are employed under time charters, voyage
charters, contracts of affreightment (COAs), and bareboat (or
demise) charters. Reefer vessels that operate in a pool are
generally time chartered to the pool by the owner and the pools
secure employment for the vessels they control through a
combination of COAs, voyage charters and time charters with other
operators or end-users.
The reefer vessel industry is characterized by cyclical
changes in supply and demand, resulting in wide swings in charter
rates and vessel utilization and, consequently, in profitability
for reefer vessel owners and operators. The supply of reefer
vessel cargo carrying capacity is a function of the number and
size of new vessels built and older vessels scrapped. The demand
for reefer vessel capacity reflects several variables, including
the size of fruit harvests, import quotas, the impact of general
economic conditions on consumer demand, and trends in worldwide
consumption and prices for reefer commodities. When growth in
demand exceeds the current or anticipated carrying capacity of
worldwide supply, charter rates generally increase. When charter
rates reach sufficiently high levels, the scrapping rate of older
vessels declines and orders for newbuildings increase. Once
commissioned, a newbuilding generally takes 18 months to 24
months to be built.
Recent trends in reefer vessel charter rates are as
follows: The average time charter rate for quality, midsize,
pallet-friendly reefer vessels more than doubled from $0.41 per
cu.ft. in 1985 to $0.85 per cu.ft. in 1991. The steady increase
in freight rates resulted in relatively heavy investment in cargo
capacity during this period, with worldwide reefer capacity (over
100,000 cu.ft.) growing by approximately 34% between 1986 and
1993. By 1993, reefer vessel cargo carrying capacity had
increased at a greater rate than reefer vessel shipping volumes.
Shipping volumes were adversely affected in late 1992 and 1993 by
the size of various fruit harvests, the European Union quota on
dollar bananas grown in Central America, and recessionary
conditions in various importing countries. Accordingly, time
charter rates for older, pallet-friendly vessels declined to
approximately $0.50 in 1993, a 41.2% decline from the peak in
1991. As a result of the decline in freight rates, scrapping of
older vessels increased and the construction of newbuildings
decreased, thereby causing a decline in the supply of cargo
carrying capacity. Charter rates began to improve in 1994 as a
result of the decline in supply capacity along with the increased
cargo shipping demand. According to industry sources average
rates for older, pallet-friendly vessels increased to
approximately $0.53 in 1994, $0.60 in 1995 and to $0.67 in 1996,
but declined to $0.65 in 1997 and 1998 to reach $0.60 in 1999.
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Results of Operations
The following table sets forth, for the periods indicated,
selected operating data as a percent of net revenue:
Year Ended December 31, September 30
___________________________________________
1995 1996 1997 1998 1999 2000
___________________________________________
Revenue from vessels, net 100% 100% 100% 100% 100% 100%
Voyage and running expenses 39.4 41.6 40.0 37.5 48.6 49.6
Depreciation and amortization 20.4 16.8 18.3 20.7 28.0 36.4
General and administrative
expenses 4.1 3.9 4.3 7.4 10.1 10.2
___________________________________________
Income from operations 36.1 37.7 37.4 34.4 13.3 3.8
Interest expense, net 3.9 4.2 3.5 13.5 20.4 (33.2)
Other expenses (income) 0.6 (0.7) (2.2) 0.0 (2.7) (4.5)
Net income(loss) 31.6 34.2 44.1 21.9 (18.8) (33.9)
Revenue from vessels, net. Revenues are generated
primarily from U.S. Dollar denominated charter hire payments
under time charters, COAs or voyage charters to independent
reefer operators, reefer pool operators and integrated
multinational fruit companies. Revenues from vessels are
presented net of shipbrokers commissions. Historically,
substantially all of the Companys time charters have been for
periods of 12 months or more. Revenues from time charters of 12
months or longer represented 82% of the Companys net revenues for
1999 while for 1998 revenues from time charters represented 92%
of the Companys net revenues. Depending on market conditions, the
Company also charters out its vessels on COAs, and in the spot
market on voyage charters. In the nine months of 2000 revenues
from time charter represented 71.2% of the Companys revenues
compared to 80% of the same period last year.
The Companys aggregate revenues are a function of the
average freight rate that it earns per vessel per day and the
total number of vessel days the fleet is in operation. The
following table summarizes the Companys average revenue per
vessel per day and total operating days:
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Year Ended December 31, September 30
1995 1996 1997 1998 1999 2000
_________________________________________________
Average revenue per vessel
per day $8,418 $10,086 $10,555 $ 9,319 $8,522 $ 9,652
Percentage increase
(decrease) 3.0% 19.8% 4.7% (11.7)% (8.6)% 13.2%
Total operating days 6,037 7,777 7,492 7,666 6,054 3651
Percentage increase 7.3% 28.8% (3.7)% 2.3%(21.0)% NA
Voyage and running expenses(VAR). Voyage and running
expenses include costs of crewing, spares and stores, insurance
premiums, lubricants, repairs and maintenance, and victualling.
The time charterer, subject to certain adjustments pays bunkers
and port expenses for vessels under time charters. Bunkers and
port expenses for vessels under voyage charters and COAs are paid
by the vessel owner and are included in voyage expenses. The
following table sets forth the Companys average voyage and
running expenses per vessel per day:
Year Ended December 31,
1995 1996 1997 1998 1999 September 30
2000
_________________________________________________
Average VAR expenses
per vessel per day $3,002 $3,989 $3,437 $ 2,824$ 3,059 $ 2,768
Percentage increase
(decrease) 7.5% 32.9% (13.8)% (17.8)% 8.3% (9.5)%
General and administrative expenses. General and
administrative expenses include management fees of $500 per day
per vessel paid to EST for technical management, headquarters
expense, office staff and the expense of administrative, legal,
quality assurance, information systems and centralized accounting
support functions. Such fees are reduced to $300 per day per
vessel when the vessel is in lay-up condition.
Depreciation and amortization. The Company depreciates
its vessels on a straight-line basis over an estimated useful
life of 25 years. For secondhand vessels, the Company depreciates
vessel acquisition costs on a straight-line basis over the
balance of such vessels useful life of 25 years. Amortization
includes dry docking costs of the vessels, which are carried out
approximately every two and one-half years. These costs are
deferred and amortized through the next dry docking period. Legal
costs and financing fees incurred in connection with the
financing of a vessel are also deferred and amortized over the
loans repayment period. Costs relating to loans that are repaid
are expensed in the period of repayment.
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Nine Months Ended September 30, 2000, compared with Nine Months
Ended September 30, 1999
Revenue from vessels, net. Revenue from vessels, net,
decreased $7.1 million to $35.2 million in the nine months of
2000, compared to $42.3 million in the same period of 1999,
representing a 16.8 % decrease. Average daily revenue per vessel
increased to $9,652 in the nine months of 2000 from $8,600 in the
nine months of 1999, representing a 12.2 % increase. Operating
days decreased to 3651 days in the nine months of 2000 from 4830
days in the nine months of 1999, representing a 24.4% decrease.
The reason for the decrease in revenues was that the vessels
operating in the spot market were directly affected by the low
spot rates and fewer voyage days due to increased idle time.
Containers generated $9.4 million or 26.5% of total revenues.
Consequently, revenues from time charters in the nine months of
2000 were $25.1 million and $10.1 million from the voyage
charters compared to $34.1 million and $8.2 million respectively
for the same period of 1999.
Voyage and running expenses. Voyage and running
expenses decreased $2.3 million to $17.4 million in the nine
months of 2000 compared to $19.8 million in the nine months of
1999. As a percentage of revenues, voyage and running expenses
increased to 49.6% in the nine months of 2000 compared to 47.8%
in the nine months of 1999.The reason for the increase as a
percentage of revenues is that more vessels operated under voyage
charters which meant that bunkers, port dues and other expenses
were paid by the Company, eventhough the running expenses
decreased due to fewer vessels in operation and the acquisition
of new vessels which are more cost efficient. Voyage expenses
were $5.7 million and $2.9 million in the nine months of 2000
and 1999, respectively.
General and administrative expenses. General and
administrative expenses decreased by $0.4 million to $3.6 million
in the nine months of 2000 compared to $4.0 million in the nine
months of 1999. This decrease was mainly due to more vessels
being in lay up condition thus the management fees charged was
$300 per day instead of $500 as per the management agreement.
Depreciation and amortization. Depreciation and
amortization increased by $2.1 million to $12.8 million in the
nine months of 2000 from $10.7 million in the nine months of
1999. This increase was mainly due to the new vessels that were
delivered to the company during the first half of 2000.
Interest expense, net. Interest expense, net, increased
by $4.0 million, to $11.7 million in the nine months of 2000 from
$7.7 million in the nine months of 1999. This increase was
primarily due to the capitalization of interest in the first half
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of 1999 for the vessels delivered during the fourth quarter of
1999 and first half of 2000 as well as the interest paid to the
loans for the financing of the delivery installment. Interest
income in the nine months of 2000 and in 1999 was $0.6 million
and $1.7 million, respectively.
Net income. Net income decreased by $4.3 million, to
$(11.9) million loss in the nine months of 2000 from $(7.6)
million loss in the nine months of 1999. As a percentage of
revenues, net income decreased to (33.9)% in the nine months of
2000 from (24.6)% in the nine months of 1999. This decrease of
$4.3 million was mainly due to the decrease of the income from
operations by $4.7 million due to the low spot market freight
rates and lower income days, increase in the Companys
depreciation by $2.1 million while other income which includes
the net interest expense decreased by $2.0 million.
Year Ended December 31, 1999, compared with Year Ended
December 31, 1998
Revenue from vessels, net. Revenue from vessels, net,
decreased $19.9 million to $51.6 million in 1999, compared to
$71.4 million in 1998, representing a 27.7% decrease. Average
daily revenue per vessel decreased to $8,522 in 1999 from $9,319
in 1998, representing an 8.6% decrease. Operating days decreased
to 6,054 days in 1999 from 7,666 days in 1998, representing a
21.0% decrease. The reason for the decrease in revenues was that
fewer vessels were on time charter in 1999 and the remaining
vessels operated in the spot market were directly affected by
lower spot rates and by the lack of additional cargoes, as banana
crops were destroyed by heavy rainfalls and floods caused by the
El Nino phenomenon during 1998. An other indication of the market
conditions and the lack of cargoes is that operating days
decreased in 1999 compared to 1998 by 21% or by 1,612 days which
means that the vessels that were in the spot market had to wait
for longer periods between voyages during the first six months of
1999 while during the third and fourth quarter of 1999 they were
in lay-up. Consequently, revenues from time charters in 1999
were $42.3 million and $9.3 million from the voyage charters. On
November 29, 1999 the Company took delivery of the first 2205 TEU
geared container which was chartered to a major charterer for 5
months. The revenues from the reefer fleet were $ 51.3 million
while the container vessel fleet contributed only $ 0.3 million
in 1999.
Voyage and running expenses. Voyage and running
expenses decreased by $1.7 million, to $25.0 million in 1999 from
$26.8 million in 1998. As a percentage of revenues, voyage and
running expenses increased to 48.6% in 1999 compared to 37.5% in
1998. The decrease of $ 1.7 million was partially due to the
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fact that the vessels in voyage charters operated fewer days and
thus concluded fewer voyages, while during the second half of the
year were in lay up, which meant that bunkers, port dues and
other expenses were reduced significantly even though more
vessels operated in the spot market compared to 1998. Voyage
expenses were $3.7 million and $2.7 million in 1999 and 1998,
respectively. Due to the continuous preventive maintenance that
the Company is implementing in its vessels and due to the days
that the vessels were in lay up, running expenses decreased by
$2.7 million in 1999.
General and administrative expenses. General and
administrative expenses remained at virtually the same level of
$5.2 million in 1999 compared to $5.3 million in 1998. These
expenses consisted of the management fee of $500 per day per
vessel paid to EST effective as of January 1, 1998, and
compensation to the Companys directors, effective from September
1, 1998. The management fees to EST are reduced to $300 per day
per vessel when a vessel is in lay-up.
Depreciation and amortization. Depreciation and
amortization decreased by $0.4 million to $14.4 million in 1999
from $14.8 million in 1998. This decrease was due to the sale
for scrapping of five vessels during the first nine months of
1999.
Interest expense, net. Interest expense, net, increased
by $0.9 million, to $10.5 million in 1999 from $9.6 million in
1998. This increase was primarily due to the Companys paying
interest on the Senior Notes for the whole of 1999 as opposed to
a portion of 1998. The amount of $3.4 million in interest
expense was capitalized because the proceeds from the Senior
Notes were used for the acquisition of the first newbuilding.
Interest expense in 1999 and in 1998 was $12.1 million and $12.0
million, respectively. Interest income in 1999 and in 1998 was
$2.1 million and $2.8 million, respectively.
Net income. Net income decreased by $25.3 million, to a
loss of $9.7 million in 1999 from a profit of $15.6 million in
1998. As a percentage of revenues, net income decreased to
(18.8)% in 1999 from 21.9% in 1998. This decrease of $25.3, was
mainly due to the decrease of net revenues by $19.9 million due
to spot market conditions, by $6.3 million due to the Companys
reimbursement of its P&I Association for a litigation claim and
decreased voyage and running expenses of $ 1.7 million resulting
from fewer spot voyages and efficient management of the Companys
vessels.
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Liquidity and Capital Resources
The Company operates in a capital-intensive industry
requiring extensive investment in revenue producing assets. The
liquidity requirements of the Company relate to servicing its
debt, funding investments in vessels, funding working capital and
maintaining cash reserves. Net cash flow generated from
operations is the main source of liquidity for the Company. Net
cash provided by operating activities was $6.7 million in the
nine months of 2000 versus $13.9 million for the same period in
1999. Additional sources of liquidity include proceeds from asset
sales and borrowings generally secured by one or more of the
Companys vessels, together with the proceeds of the Companys
offering of Senior Notes.
Net cash provided by operating activities decreased to
$6.7 million in the nine months of 2000 from $16.1 million in the
nine months of 1999, primarily due to the lower net income for
the period, and increase of the net working capital. Net cash
provided by operating activities consists of the Companys net
income, increased by non-cash expenses such as depreciation and
amortization of deferred charges, and adjusted by changes in
working capital.
Net cash used in investing activities was $46.0 million
out of which $12.3 million has been paid to the shipyard in
Taiwan for the installments of the vessels under construction.
The sale proceeds from the sale of the two companies was $11.7
million while the delivery payments for the vessels that was
delivered to the company was $45.2 million. The remaining
installments amount to $5.0 million. The Companys principal uses
of cash in investing activities have been vessel acquisitions and
improvements, and purchases of equipment, as well as installment
payments for vessels under construction.
Net cash provided by financing activities in the nine
months of 2000 was $38.8 million, which was the secured loans
received by the banks to finance the delivery payment of the
vessels, which was delivered to the Company on 25/2/00 and
26/4/00. Thus, cash and cash equivalents at September 30, 2000
were decreased to $13.5 million. The Company expects to fund the
remaining $5.0 million for the acquisition of the newbuildings
vessels from its existing cash together with the cash generated
by operations.
The Senior Notes Indenture contains certain covenants
that, among other things, limit the ability of the Company and
its Restricted Subsidiaries to: (i) incur additional
indebtedness; (ii) make restricted payments; (iii) allow
restrictions on distributions from subsidiaries; (iv) incur
liens; (v) enter into certain transactions with affiliates; (vi)
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sell, assign, transfer, lease, convey or otherwise dispose of all
or substantially all of the assets of the Company; (vii) enter
into sale and leaseback transactions; (viii) issue capital stock
of its subsidiaries; (ix) enter into certain business activities;
and (x) merge or consolidate with any other person. Events of
default under the Senior Notes Indenture include (i) failure to
pay principal or interest when due; (ii) failure to comply with
certain restrictions on mergers, consolidations and transfers of
assets, (iii) failure to comply with certain agreements and
covenants in the Senior Notes Indenture; (iv) certain events of
default on other indebtedness; (v) certain events of bankruptcy,
and (vi) the breach of any representation or warranty.
The Company believes that, based on current levels of
operating performance and expected market conditions, its cash
flow from operations, and other available sources of funds, will
be adequate to make the required payments of the installments due
to the shipyard, to fund the working capital requirements for the
foreseeable future and finally to participate to the
consolidation of the reefer industry through opportunistic
mergers and acquisitions.
Inflation
Although inflation had a moderate impact on operating
expenses, dry docking expenses and corporate overhead, management
does not consider inflation to be a significant risk to direct
costs in the current and foreseeable economic environment.
However, in the event that inflation becomes a significant factor
in the world economy, inflationary pressures would result in
increased operating and financing costs.
Foreign Exchange Rate Fluctuation
The international reefer industrys functional currency
is the U.S. Dollar and, as a result, virtually all of the
Companys revenues are in U.S. Dollars. Historically, general and
administrative expenses are incurred in Greek Drachmae, while a
significant portion of the cost of revenues is incurred in U.S.
Dollars and, to a much lesser extent, other currencies. The
Company has a policy of continuously monitoring and managing its
foreign exchange exposure, but the Company currently does not
have any, and does not believe that it has any current need to
enter into, foreign currency hedging transactions.
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ENTERPRISES SHIPHOLDING CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1999 AND SEPTEMBER 30 2000
(Expressed in thousands of U.S. Dollars - except per share data)
ASSETS 1999 2000
---------- ----------
CURRENT ASSETS:
Cash and cash equivalents $ 14,011 $ 13,524
---------- ----------
Marketable Securities 0 0
Accounts receivable-
Trade 916 172
Insurance claims 492 78
Others receivables 83 0
---------- ----------
1,491 250
---------- ---------
Inventories 2,299 2,159
Prepayments and other 395 896
---------- ----------
Total current assets 18,196 16,829
---------- ----------
FIXED ASSETS:
Advances for New Buildings 45,670 16,041
Vessels' cost 249,181 320,577
Accumulated depreciation (77,988) (90,224)
---------- ----------
Total fixed assets 216,863 246,394
---------- ----------
OTHER NON CURRENT ASSETS:
Deferred charges, net of amortization 4,636 4,215
---------- ----------
Total assets $ 239,695 $ 267,438
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 0 $ 0
---------- ----------
Accounts payable-
Trade 3,963 1,659
Due to a related company 643 422
Master accounts 575 330
---------- ----------
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5,181 2,411
---------- ----------
Dividends payable 0 0
Due to management companies 353 199
Unearned revenue 493 434
Accrued interest and finance charges 2,589 6,745
Claim payable 6,300 5,850
Other accrued liabilities 458 475
Due to shareholders 0 0
---------- ----------
Total current liabilities 15,374 16,114
---------- ----------
LONG-TERM DEBT, net of current maturities
Senior notes payable 175,000 175,000
Banks 0 38,988
Related party 0 0
---------- ----------
175,000 213,988
---------- ----------
SHAREHOLDERS' EQUITY:
Share capital, nominal value $0.01
each (100,000,000 shares authorised,
issued and outstanding at December 31, 1999
and September 30 2000) 1,000 1,000
Retained earnings 48,321 36,336
Other comprehensive income 0 0
---------- ----------
Total shareholders' equity 49,321 37,336
---------- ----------
Total liabilities and
shareholders' equity $ 239,695 $ 267,438
========== ==========
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ENTERPRISES SHIPHOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIOD ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 2000
(Expressed in thousands of U.S. Dollars - except per share data)
1999 2000
--------- -------
REVENUE FROM VESSELS, net $ 42,362 $ 35,242
VOYAGE AND RUNNING EXPENSES (19,851) (17,468)
---------- ----------
Gross profit 22,511 17,774
DEPRECIATION AND AMORTIZATION (10,696) (12,826)
GENERAL AND ADMINISTRATIVE EXPENSES (4,063) (3,610)
---------- ----------
Income from operations 7,752 1,338
---------- ----------
OTHER INCOME (EXPENSES):
Interest and finance expenses, net (7,692) (11,724)
Foreign currency gain (loss) 63 82
Provision for Claim (6,732)
Other, net (1,033) (1,681)
Total other income (expenses) (15,394) (13,323)
---------- ----------
Net Income (Loss for the period) $ (7,642) (11,985)
========== ==========
Earnings per share, basic $ (0.08) $ (0.12)
========== ==========
Weighted average number of shares, basic 100,000,000 100,000,000
========== ==========
EBITDA $ 18,448 $ 14,164
Ratio of EBITDA to interest expense net 2.40 1.21
EBITDA Margin 43.55% 40.19%
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ENTERPRISES SHIPHOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE PERIOD ENDED SEPTEMBER 30,2000
(Expressed in thousands of U.S. Dollars - except per share data)
Valuation
of
Marketable
Capital Securities Retained
Stock Surplus (Loss) Earnings Total
___________ _____________ _____________________
BALANCE, December 31,1999 $ 1,000 $ 0 $ 48,321 49,321
Net income (Loss) 0 0 (11,985) (11,985)
Valuation of Marketable sec. 0 0 0 0
___________ _____________ ___________ __________
BALANCE, September 30,2000 $ 1,000 $ 0 $ 36,336 37,336
========== ============ ========== =========
ENTERPRISES SHIPHOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE PERIOD ENDED SEPTEMBER 30,1999
(Expressed in thousands of U.S. Dollars - except per share data)
Valuation
of
Marketable
Capital Securities Retained
Stock Surplus (Loss) Earnings Total
___________ _____________ _____________________
BALANCE, December 31,1998 $ 1,000 $ 891 $ 57,125 $ 59,016
Loss 0 0 (7,642) (7,642)
Valuation of Marketable
Securities. 0 (59) 0 (59)
___________ _____________ ___________ __________
BALANCE, September 30,1999 $ 1,000 $ 832 $ 49,483 $ 51,315
========== ============ ========== =========
17
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ENTERPRISES SHIPHOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE PERIODS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 2000
(Expressed in thousands of U.S. Dollars)
1999 2000
Cash Flows from operating activities:
Net income $ (7,642) $ (11,985)
Adjustments to reconcile net income to
net cash provided by operating activities-
Depreciation 9,755 12,236
Amortization of deferred charges 941 590
Loss from vessels sale 1,249 4,218
(Increase) Decrease in:
Accounts receivable 1,838 1,241
Inventories 589 140
Prepayments and other (785) (501)
Increase (Decrease) in:
Accounts payable (1,088) (2,304)
Master Account 0 (245)
Due to a related company 0 (220)
Accrued Interest and Finance Charges 3,882 4,156
Other accrued liabilities 418 17
Unearned revenue 279 (59)
Claim payable 6,732 (450)
Amounts due to management companies 0 (154)
---------- ----------
Net cash provided by operating activities 16,168 6,680
---------- ----------
Cash Flows (for) from investing activities:
Advances for New Buildings (16,106) (12,307)
Payments for vessels' acquisition and improvements 0 (45,249)
Net sales proceeds 2,566 11,670
Proceeds from vessel constructive loss, net 0 0
Payments for drydocking and special survey costs (380) (148)
Purchase of marketable securities 6,860 0
Proceeds from sale of marketable securities 0 0
---------- ----------
Net cash (used in) provided by investing activities (7,060) (46,034)
---------- ----------
Cash Flows (for) from financing activities:
Proceeds from shareholders, net of withdrawals 0 0
Proceeds from long-term debt, banks 0 40,000
Proceeds from issuance of Senior Notes 0 0
Payments and repayment of long-term debt, banks 0 (1,012)
18
<PAGE>
Payments and repayment of long-term debt,
related party 0 0
Payments for financing fees 0 (121)
Payments for dividends (7,500) 0
Notes issuance and distribution 0 0
---------- ----------
Net cash (used in) provided by financing activities (7,500) 38,867
---------- ----------
Net increase (decrease) in cash and
cash equivalents 1,608 (487)
Cash and Cash Equivalents, beginning of period 26,854 14,011
---------- ----------
Cash and Cash Equivalents, end of period $ 28,462 $ 13,524
========== ==========
19
<PAGE>
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.
ENTERPRISES SHIPHOLDING CORPORATION
(registrant)
Dated: November 21, 2000 By: /s/ Victor Restis
___________________________
Victor Restis
President and Chief
Executive Officer
20
02391003.AA8
