Nimitz heads for Bremerton, carrying cars
The aircraft carrier USS Nimitz (CVN 68) departed San Diego December 6 to conduct an administrative homeport change from Naval Base Coronado to Naval Base Kitsap at Bremerton, Wash. Nimitz is making
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NSRP picks new projects for funding
The National Shipbuilding Research Program (NSRP) says its Executive Control Board has selected 13 new research and development projects for awards totaling approximately $1.3 million. The projects will come under the umbrella
Indian warship fires warning shots ahead of Restis bulker
The Indian Navy today fired warning shots ahead of a Restis Group bulker, the 57,000 dwt Bahamas-flag Dynamic Striker. The ship, managed by Restis’s Enterprises Shipping and Trading, arrived in Mumbai October
Intersleek delivers big fuel savings for NSCSA
Eight Very Large Crude Carriers are achieving Very Large Carbon Cuts. A detailed performance analysis of a National Shipping Company of Saudi Arabia (NSCSA) tanker confirms that the company has achieved substantial
Engine room fire disables Carnival Splendor
When both tugs were on station and current conditions right, they were expected to slowly two the vessel — at 113,323 gt one of the world’s largest cruise ships — to Ensenada to disembark passengers.
The Carnival Splendor is presently located 150 miles south of San Diego and has 3,299 passengers and 1,167 crew members aboard. They faced a second day without key hotel systems, including air conditioning, hot food service, and telephones, following an engine room fire that broke out yesterday morning. Last night, the ship’s engineers were able to restore toilet service to all cabins and public bathrooms, as well as cold running water. The ship’s crew continues to actively work to restore other services. though Carnival said last night that “the ship’s crew is actively working to restore partial services.”
No injuries to passengers or crew have been reported.
Units from the U.S. Coast Guard and the Mexican Navy have been deployed to the scene.
At the request of Coast Guard District 11 in San Diego, 3rd Fleet diverted the aircraft carrier USS Ronald Reagan from its current training maneuvers to a position south of the cruise ship to facilitate the delivery of needed supplies, That involved transfering 35 pallets of supplies by Fleet Logistics Support Squadron 30 carrier on-board delivery aircraft to Ronald Reagan. Once aboard Ronald Reagan, the supplies were to be delivered by helicopter to Carnival Splendor.
The ship became disabled after a fire was detected in the aft engine room at approximately 6.a.m, (U.S. Pacific Standard Time) yesterday.
Carnival said that the ship has been operating on auxiliary generators , with engineers unable to restore additional power to the vessel.
Though passengers were initially asked to move from their cabins to the ship’s upper open deck areas, they later regained access to their cabins and were able to move about the ship. Bottled water and cold food items are being provided.
The current voyage has been terminated and Carnival says guests will be receiving a full refund along with reimbursement for transportation costs. Additionally, they will receive a complimentary future cruise equal to the amount paid for this voyage.
“We know this has been an extremely trying situation for our guests and we sincerely thank them for their patience. Conditions on board the ship are very challenging and we sincerely apologize for the discomfort and inconvenience our guests are currently enduring. The safety of our passengers and crew is our top priority and we are working to get our guests home as quickly as possible,” said Gerry Cahill, president and CEO of Carnival Cruise Lines.
Carnival Splendor was on the first leg of a seven-day Mexican Riviera cruise that departed yesterday, Nov. 7, from Long Beach, Calif.Yesterday was a scheduled day at sea. The ship’s normal itinerary includes stops in Puerto Vallarta, Mazatlan and Cabo San Lucas, Mexico.
The Fincantieri-built ship first entered service in July 2008.
November 9, 2010
New Mitsui bulker cuts CO2 emissions
Named the “neo Supramax 66BC,” the new ship is an enlarged version of Mitsui’s best selling 56,000 dwt type handymax bulker, for which it has received over 150 orders
Development of the neo Supramax 66BC design involved extensive consultations with shipowners and operators and investigations of more than 600 ports all over the world. The result is a ship designed to have wide beam (36 m) and shallow draft, taking into account current 56BC trading patters and the expansion of Panama Canal, expected in 2014.
The ship is a general use bulk carrier equipped with deck cranes and suited for the carriage of bulk cargoes including coal, iron ore, wheat, barley, soya beans, etc. It can also carry lengthy/heavy cargoes such as steel pipe and hot coil. Hatch openings are optimized for the existing cargo handling equipment at various ports.
Although the neo Supramax 66BC is larger than the 56BC, its fuel consumption less as a result of adopting Mitsui’s newly developed energy-saving hull form.
The shipbuilder is offering two specifications for the ship – Premium and Standard. The Premium model will achieves a reduction of CO2 emission by about 21 percent on a ton-mile basis with a further reduction of up to about 30 percent with the application of optional software and hardware .
Mitsui is also developing measures to meet future SOx and NOx emission controls and requirements for ballast water treatment system is adopted, which is a hot current topic among maritime industries.
Principal Particulars of the Ship
Length overall 200 m
Breadth 36 m
Depth 18.45 m
Full-load draft 12.9 m
Deadweight 66,000 metric tons
Service speed 14.5 knots
New Mitsui bulker cuts CO2 emissions
Named the “neo Supramax 66BC,” the new ship is an enlarged version of Mitsui’s best selling 56,000 dwt type handymax bulker, for which it has received over 150 orders
Development of the neo Supramax 66BC design involved extensive consultations with shipowners and operators and investigations of more than 600 ports all over the world. The result is a ship designed to have wide beam (36 m) and shallow draft, taking into account current 56BC trading patters and the expansion of Panama Canal, expected in 2014.
The ship is a general use bulk carrier equipped with deck cranes and suited for the carriage of bulk cargoes including coal, iron ore, wheat, barley, soya beans, etc. It can also carry lengthy/heavy cargoes such as steel pipe and hot coil. Hatch openings are optimized for the existing cargo handling equipment at various ports.
Although the neo Supramax 66BC is larger than the 56BC, its fuel consumption less as a result of adopting Mitsui’s newly developed energy-saving hull form.
The shipbuilder is offering two specifications for the ship – Premium and Standard. The Premium model will achieves a reduction of CO2 emission by about 21 percent on a ton-mile basis with a further reduction of up to about 30 percent with the application of optional software and hardware .
Mitsui is also developing measures to meet future SOx and NOx emission controls and requirements for ballast water treatment system is adopted, which is a hot current topic among maritime industries.
Principal Particulars of the Ship
Length overall 200 m
Breadth 36 m
Depth 18.45 m
Full-load draft 12.9 m
Deadweight 66,000 metric tons
Service speed 14.5 knots
K-Sea gets $100 million cash injection
Last week, K-Sea had postponed its fourth quarter fiscal 2010 earnings conference call, which had been scheduled for August 31. It staged the call today. It is being archived for seven days and can be accessed HERE
KA First Reserve will appoint three directors to the board of K-Sea’s general partner and will be granted the right to acquire a 35 percent interest in the entity that owns the company’s Incentive Distribution Rights, or IDRs.
The board will be expanded from six members to nine members; KA First Reserve’s designees to join the board are Gary Reaves of First Reserve and Kevin McCarthy and Jim Baker of Kayne Anderson.
President and CEO Timothy J. Casey said, “We are very pleased with our new association with First Reserve and Kayne Anderson. These organizations have a wealth of experience and expertise in the MLP and energy businesses. Their decision to invest in us is a testimony to K-Sea’s leading industry position and the strength of our company. With our balance sheet recapitalization behind us, we will be able to focus on operations, results and new opportunities. We remain convinced the domestic market for marine transportation of refined petroleum products will rebound significantly when demand recovers and single hull vessels leave the market permanently.”
Mr. Casey said the company continues to concentrate on cost control and eliminating low-return assets. “On the latter point,” he said, “we have a definitive agreement to sell two tugboats and our two oldest double-hulled barges to an international buyer, and we have a definitive agreement to sell our environment services property in Norfolk, Virginia. Both transactions should close in the September 2010 quarter.”
The proceeds from the sale of the preferred units will be used to reduce outstanding indebtedness and pay fees and expenses related to the transaction. The investment is expected to close in two steps — $85 million in early September and the remaining $15 million within the thirty days following clearance of Hart-Scott-Rodino review.
K-Sea has also executed amendments to its revolving credit facility and term loans that will become effective on closing of the initial $85 million investment. The amendment to the revolving credit facility reduces the lenders’ commitments from $175 million to $115 million; amends the financial covenants; maintains a July 1, 2012 maturity date; and allows the company to pay distributions subject to certain minimum financial ratios. After applying the expected net proceeds of the $100 million Preferred Unit investment, the company’s total funded debt as of September 1, 2010 was $279.2 million on a pro forma basis, which represents a ratio of Funded Debt to EBITDA (as defined in the revolving credit agreement) of 4.3 times fiscal year 2010 EBITDA.
The preferred units will have a coupon of 13.5%, with payment-in-kind distributions through the quarter ended June 30, 2012 or, if earlier, when the company resumes cash distributions on its common units. The preferred units convert on a unit-for-unit basis into common units at KA First Reserve’s option. The preferred units were priced at $5.43 per unit, which represents a 10% premium to the 5-day volume weighted average price of K-Sea’s common units as of August 26, 2010.
The company will have an option to force conversion after three years if the price of K-Sea’s common units is 150% of the conversion price on average for 20 consecutive days on a volume-weighted basis.
K-Sea describes First Reserve as “one of the world’s leading private equity firms in the energy industry, making both private equity and infrastructure investments throughout the energy value chain, with approximately $19 billion under management” and Kayne Anderson as “a leading investment firm focused on the energy industry with approximately $10 billion under management and […] the largest institutional investor in MLPs.”
The pricing grid for the amended credit facility changes only when the total funded debt to EBITDA ratio rises above 5.0 times. It is expected that the company’s interest cost under the revolving credit facility will rise by 50 basis points at the effective date.
OPERATING RESULTS
K-Sea also today reported operating results for its fourth fiscal quarter ended June 30, 2010. The company reported an operating loss of $0.5 million, excluding a $54.3 million write-off of goodwill and an impairment charge of $5.1 million on excess tugboats. This represents a decrease of $8.8 million, compared to $8.3 million of operating income for the fourth fiscal quarter ended June 30, 2009. Including the write-off of goodwill and the impairment loss, our operating loss for the quarter was $59.9 million. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the fourth quarter of fiscal 2010 was $12.4 million, a decrease of $9.1 million, or 42%, compared to $21.5 million in the same quarter last year; and an increase of $3.3 million, or 36%, compared to $9.1 million for the March 2010 quarter. There were two special items in the fiscal 2010 fourth quarter that impacted EBITDA: a $1.0 million charge for an additional insurance call previously mentioned in our financial statements; and a $0.8 million gain from the sale of assets. Excluding these items, EBITDA was $12.6 million. EBITDA is a non-GAAP financial measure that is reconciled to net income, the most directly comparable GAAP measure, in the table below.
Three Months Ended June 30, 2010
For the three months ended June 30, 2010, the Company reported an operating loss of $0.5 million, excluding the previously mentioned write-off of goodwill and impairment charge. This represents a decrease of $8.8 million, compared to $8.3 million of operating income for the three months ended June 30, 2009. EBITDA decreased by $9.1 million, or 42%, to $12.4 million for the three months ended June 30, 2010, compared to $21.5 million for the three months ended June 30, 2009. EBITDA was negatively impacted by a non-recurring $1.0 million insurance charge relating to an additional insurance call by the Company’s insurance carrier. The carrier had previously announced the possibility of the call in November 2008; however, the insurance carrier did not decide to make the call until May 2010. The decrease in EBITDA resulted mainly from a $7.3 million decline in revenue, net of voyage expenses, which is attributable to fewer working days owing to the retirement of a majority of our single-hull vessels and an overall reduction in net utilization mainly relating to expiring contracts and the need to employ vessels in the spot market. Additionally, vessel operating expenses increased by $2.0 million as a result of the $1.0 million insurance call and $1.3 million of increased operating lease expenses mainly relating to sale leaseback transactions entered into in June 2009.
Net loss for the three months ended June 30, 2010 was $7.1 million, or $0.37 per fully diluted limited partner unit, excluding the write-off of goodwill and impairment charge. This represents a decrease of $9.7 million compared to net income of $2.6 million, or $0.09 per fully diluted limited partner unit, for the three months ended June 30, 2009. The decrease was primarily a result of the $8.8 million decrease in operating income. Interest expense also increased by $1.6 million resulting from increased interest margins due to the December amendment of our revolving credit facility and a term loan. Including the write-off of goodwill and the impairment charge, net loss for the three months ended June 30, 2010 was $66.5 million, or $3.43 per fully diluted limited partner unit.
Fiscal Year Ended June 30, 2010
For the fiscal year ended June 30, 2010, the Company reported operating income of $1.8 million, excluding a $54.3 million write-off of goodwill and a $12.6 million asset impairment charge on single-hull vessels and excess tugboats. This compares with $36.5 million of operating income for the fiscal year ended June 30, 2009. Including the write-off of goodwill and the asset impairment charge, the Company reported an operating loss of $65.1 million for the fiscal year ended June 30, 2010. EBITDA decreased by $34.1 million, or 38%, to $55.5 million for the fiscal year ended June 30, 2010, compared to $89.6 million for the fiscal year ended June 30, 2009. The decrease in EBITDA resulted from a $43.9 million decrease in revenue, net of voyage expenses, which as mentioned above, is attributable to fewer working days due to the retirement of a majority of our single-hull vessels and an overall reduction in net utilization directly relating to expiring contracts and having to employ vessels in the spot market. This decrease was partially offset by a $6.2 million reduction in vessel operating expenses and a $2.6 million reduction in general and administrative expenses.
Net loss for the fiscal year ended June 30, 2010 was $20.5 million, or $1.08 per fully diluted limited partner unit, excluding the write-off of goodwill and impairment charges. This represents a decrease of $34.4 million compared to net income of $13.9 million, or $0.61 per fully diluted limited partner unit, for the fiscal year ended June 30, 2009. Including the write-off of goodwill and the impairment charges, net loss for fiscal year 2010 was $87.4 million, or $4.60 per fully diluted limited partner unit.