Globus Maritime Ltd (NASDAQ:GLBS)

Globus Maritime Ltd (NASDAQ:GLBS) Drops As Revenues Surge

Globus Maritime Ltd (NASDAQ:GLBS)

Globus Maritime Ltd (NASDAQ:GLBS) shares fell 7.55% after the dry bulk shipping company reported unaudited, consolidated operating and financial results for the first half of the year. Revenues in the first half increased 63% compared to last year.

Globus Maritime Ltd (NASDAQ:GLBS)

Improving Fundamentals

According to the Chief Executive Officer, Athanasios Feidakis, the revenue growth indicates that the company’s efforts are finally bearing fruit. However, it appears investors remain skeptical about the company’s growth prospects.

Globus Maritime Ltd (NASDAQ:GLBS) has underperformed the overall industry even after the recovery of benchmark dry-bulk rates. The stock is down by more than 70% for the year as it continues to trade in a strong downtrend.

However, the Chief Executive Officer remains bullish about the company’s prospects buoyed by the 63% increase in revenues. Globus Maritime Ltd (NASDAQ:GLBS) has also trimmed its debt by about 30%, a further indication of bottom-line growth. Recovery in benchmark dry-bulk rates has allowed Global Maritime to hire its vessels out at a much higher rate.

“We are hoping to see a further improvement of the market fundamentals in the medium term future. We remain cautiously optimistic, and are following the market closely in our undertaking to best serve our clients and shareholders,” said Mr. Feidakis

Globus Financial Results

For the three months ended June 30, 2017, Globus Maritime Ltd (NASDAQ:GLBS) generated a net loss of (-$1.4) million or (-$0.05) a share, less than half a net loss of (-$2.9) million reported last year. The company attributes the decrease in net loss to an 80% increase in voyage revenues that came in at $3.6 million. Vessel operating expenses were down by $0.1 million or 5%.

For the first six months of the year, net loss totaled (-$3.7) million or (-$0.17) a share, compared to a net loss of (-$4.6) million for the corresponding period last year. Voyage revenue over the period was up 66% to $6.3 million as vessel operating expenses remained flat at $4.3 million.

Separately, an investor holding warrants, originally issued under February 2017 private placement, has exercised their right to purchase 500,000 shares of the company’s common stock at a price of $1.60 a share.

“We are pleased to have strengthened our balance sheet by $800,000. We consider this evidence of our investors’ support for our relentless efforts to move forward,” said Mr. Feidakis.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

DryShips Inc. (NASDAQ:DRYS)

Why Did Globus Maritime Ltd (NASDAQ:GLBS) Shares Explode?

Why Did Globus Maritime Ltd (NASDAQ:GLBS)

Globus Maritime Ltd (NASDAQ:GLBS) was a big mover in Wednesday’s trading session its stock and experienced unusual trading volume. A rally of more than 80% came as a surprise given that the stock has been under pressure on failing to beat earnings estimates for its recent quarterly filling.

Debt Settlement

The rally’s cause is still unknown as investors wait to see if the stock will continue to power higher. Last month the company announced that it had reached an agreement with two of its lenders, DVB Bank and HSH Nordbank AG, on waivers and terms of agreements dated June 20, 2011, and February 27, 2015.

The dry bulk company says it has nice received waivers and relaxations on its loans covenants and deferred certain loan payments that were due this year.

“We are very pleased that our efforts with our lenders have been fruitful. Our agreements with both DVB Bank and HSH Nordbank AG to gain waiver relaxations of our financial covenants as well as the deferrals in our installment loan payments gives the Company a breather and allows us to concentrate on our operational activities and plan ahead,” said Chief executive officer, Athanasios Feidakis.

Full Year Earnings

The company recently reported its full year earnings for the period ending December 31, 2016. Total revenue for the period came in at $9 million – a decline from revenues of $12.72 million reported for the full year ending December 31, 2015. Net income was also lower having tanked to $9.825 million from highs of $32.4 million reported the previous year.

Globus Maritime Ltd (NASDAQ:GLBS) has attributed the drop in earnings to continued weakness in the dry bulk shipping services business. The dry bulk company has since warned that its earnings may continue drop should fuel prices, which account for the largest expense in the industry, continue to rise. The increase in crew costs is another headwind that the company is facing which could considerably affect its profitability going forward.

Globus Maritime Ltd (NASDAQ:GLBS) has also warned that it might not be adequately insured to cover operational losses that might be incurred as it continues to operate its fleet of vessels. The fact that insurers may refuse to cover some losses is an operational risk that concerns industry analysts.

Globus Maritime Ltd (NASDAQ:GLBS) stock was up by 82.38% in Wednesday’s trading session, ending the day at highs of $1.66 a share.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.

Globus Maritime Ltd (NASDAQ:GLBS) Jumps 56%

Globus Maritime Ltd (NASDAQ:GLBS)

Many analysts revised their stock ratings on Globus Maritime Ltd (NASDAQ:GLBS) after a shocking, DryShips-inspired recapitalization agreement diluted external shareholders by over 90%. The company released 5 million new shares to as many as 4 investors for total gross proceeds of $5 million. The placement price essentially calculates to merely $1 per share.

Moreover, the company released warrants to buy an additional 25 million shares at $1.60 per share. In order to erase $20 million in credit obligations, the company issued an additional 20 million shares to firms controlled by the Globus’s chairman – the debt conversion price was $1.

The update

The chairman’s entities received warrants to buy another 7.4 million shares for $1.60 per share. As a result, the new share count comes to 27.6 million, an immediate dilution of 90% for external shareholders. Even worse, the equity count should soon surge to 60 million considering the low warrant exercise rate of $1.60 and, importantly, the warrants are instantly exercisable. Final dilution would compute to 95.5%.

After the exercising of warrants and the debt conversion, Globus Maritime will have almost $57 million in cash and $45 million in total debt for a cash balance of almost $12 million, add roughly $50 million in fleet market value and the firm’s net asset worth post recapitalization comes to just $1 per share.

At a share price of $7, the firm ‘s market cap comes in around $17 million. Not bad for a deal that initially reduced the firm’s net debt by a mere $25 million and only gets the net asset value to above zero from negative territory.

Analysts initially considered that the additional shares can hit the market almost immediately, however the fact is these shares have yet to be registered with the U.S. SEC and looking at the contract terms, the new shareholders will have to wait at least 6 months before their allowed rights to demand registration turns exercisable.

It indicates, the firm’s registered share count of 2.6 million will likely remain unchanged for next 6 months with the free float considered to be even lower with the chairman being the firm’s controlling shareholder.

Considering these issues, analysts revised their recommendation. Globus Maritime Ltd (NASDAQ:GLBS) stock was a huge mover yesterday! The stock surged over 56% or almost $2.40 during the last trading session, closing at $6.74. About 3.72 million shares traded or over 1203% up from the average. The stock has gained 63.64% since last August 2016 and is in up trend.

3/17/2017
Ticker Symbol GLBS
Last Price a/o 3:21 PM EST  $6.74
Average Volume  745.15K
Market Cap (mlns)  $19.34M
Shares Outstanding (mlns) 2.87M
Share Float (mlns) 2.37M
Inside Ownership
Short Float 7.66%
Short Interest Ratio 0.24
Quarterly Return 17.83%
YTD Return 65.20%
Year Return 1023.33%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.