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GRINSHIP:  25,300   0 (0.00%)  01/01/1970 00:00

GRINDROD SHIPPING HOLDINGS LIMITED - Unaudited Financial Results for the three months and nine months ended September 30, 2021 and Interim Dividend

Release Date: 18/11/2021 07:45
Code(s): GSH     PDF:  
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Unaudited Financial Results for the three months and nine months ended September 30, 2021 and Interim Dividend

GRINDROD SHIPPING HOLDINGS LTD.
ABBREVIATED NAME: GRINSHIP
Registered in Singapore with registration number 201731497H
JSE Share code: GSH
ISIN: SG9999019087
Primary listing on NASDAQ Global Select Market
Secondary listing on the JSE Main Board


Grindrod Shipping Holdings Ltd. Announces Unaudited Financial Results for the three months and nine
months ended September 30, 2021 and Interim Dividend

Grindrod Shipping Holdings Ltd. (NASDAQ: GRIN) (JSE: GSH) (“Grindrod Shipping” or "Company" or “it” or “we”),
a global provider of maritime transportation services predominantly in the drybulk sector, announced its
unaudited earnings results for the three months and nine months ended September 30, 2021 and that the
directors of the Company have resolved to declare a gross cash dividend from profits in respect of the 3rd Quarter
Financial Year 2021 ended 30 September 2021 in the amount of US$0.72 per ordinary share to shareholders
reflected in the Company’s register on the record date, being Friday, 3 December 2021.

Financial Highlights for the three months Ended September 30, 2021
    - Revenues of $135.1 million

    -   Gross profit of $62.0 million

    -   Profit for the period of $49.1 million

    -   Profit for the period attributable to owners of the Company of $44.0 million, or $2.29 per ordinary share

    -   Adjusted net income of $45.8 million, or $2.38 per ordinary share(1)

    -   Adjusted EBITDA of $69.0 million(1)

    -   Repurchased a combined total of 91,871 ordinary shares in the open market on NASDAQ and the JSE at
        an average price of $14.87 per share.

    -   Handysize and supramax/ultramax TCE per day of $25,919 and $29,934, respectively(1)


Financial Highlights for the nine months Ended September 30, 2021

    -   Revenues of $366.4 million

    -   Gross profit of $110.2 million

    -   Profit for the period of $76.7 million

    -   Profit for the period attributable to owners of the Company of $66.1 million or $3.44 per ordinary share

    -   Adjusted net income of $67.3 million, or $3.50 per ordinary share(1)

    -   Adjusted EBITDA of $131.5 million(1)
    -   Repurchased a combined total of 125,338 ordinary shares in the open market on NASDAQ and the JSE
        at an average price of $13.16 per share.

    -   Handysize and supramax/ultramax TCE per day of $18,847 and $21,514, respectively(1)

    -   Period end cash and cash equivalents of $76.1 million and restricted cash of $9.0 million

(1)
  Adjusted EBITDA, Adjusted net income and TCE per day are non-GAAP financial measures. For the definitions of these
non-GAAP financial measures and the reconciliation of these measures to the most directly comparable financial measure
calculated and presented in accordance with GAAP, please refer to the definitions and reconciliations in “Non-GAAP
Financial Measures” at the end of this press release.


Operational Highlights for the three months Ended September 30, 2021

      -   The Company has exercised its option to extend the firm charter-in period of the 2015-built supramax
          bulk carrier IVS Pinehurst for 11 to 13 months at $10,000/day, starting from approximately January 3,
          2022.
      -   On September 1, 2021, the acquisition of the remaining 31.14% equity stake in its IVS Bulk joint venture
          (“IVS Bulk”) and concurrent redemption of the IVS Bulk preference shares were concluded.
      -   On September 15, 2021, the Company amended one of its existing credit facilities to drawdown an
          additional $23.0 million to fund the IVS Bulk acquisition.
      -   On September 16, 2021, the Company completed the acquisition of the 2019 Japanese-built ultramax
          bulk carrier IVS Phoenix for $23.5 million and the concurrent financing for $25.0 million.



Recent Developments

      -   The Company exercised its option to extend the firm charter-in period of the 2014-built supramax bulk
          carrier IVS Naruo for 12 months at $13,000/day, starting from approximately January 21, 2022.


      -   As of November 14, 2021, we have contracted the following TCE per day for the fourth quarter of 2021
          (1)
              

          - Handysize: approximately 1,205 operating days(2) at an average TCE per day of approximately
            $30,265

          - Supramax/ultramax: approximately 1,579 operating days(2) at an average TCE per day of
            approximately $33,102

(1)
  TCE per day is a non-GAAP financial measure. For the definition of this non-GAAP financial measure and the reconciliation
of this measure to the most directly comparable financial measure calculated and presented in accordance with GAAP,
please refer to the definitions and reconciliations in “Non-GAAP Financial Measures” at the end of this press release.

(2)
  Operating days: the number of available days in the relevant period a vessel is controlled by us after subtracting the
aggregate number of days that the vessel is off-hire due to a reason other than scheduled drydocking and special surveys,
including unforeseen circumstances. We use operating days to measure the aggregate number of days in a relevant period
during which vessels are actually available to generate revenue.

                                                         2
CEO Commentary

Martyn Wade, the Chief Executive Officer of Grindrod Shipping, commented:

“During the third quarter of 2021, Grindrod Shipping achieved stronger results taking full advantage of the
robust market conditions and our expanded owned fleet following the acquisition of the remaining portion of
our IVS Bulk subsidiary. We generated Gross Profit, Profit for the period attributable to owners of the Company,
Adjusted EBITDA and Adjusted Net Income of $62.0 million, $44.0 million, $69.0 million, and $45.8 million,
respectively. We are particularly pleased to announce the declaration of our first quarterly cash dividend of
$0.72 per ordinary share under our new dividend and capital return policy of returning approximately 30% of
our Adjusted Net Income to our shareholders through a combination of share repurchase and dividends.

Today, Grindrod Shipping is strategically positioned to benefit from the robust dry bulk market. With an average
age of six years, our Fleet consists of approximately 70% “Eco” vessels built predominantly in Japan, and is, we
believe, among the youngest and most efficient in the industry, with distinct commercial and operational
advantages. In addition, our dynamic and flexible commercial strategy of opportunistically chartering-in vessels
at attractive rates on both long- and short-term time charters with extension options improves our ability to
service our cargo contracts and realise potential earnings and profitability with contracted rates which are at
levels significantly below the current spot rates. We were also able to generate additional revenue during the
period from our short-term fleet, with several vessels that were opportunistically chartered-in during 2020 at
rates well below current spot rates. The original charters contained fixed rate extension options which continue
to benefit the profitability of the Company.

Furthermore, as also disclosed, we hold purchase options for five of our long-term chartered-in vessels, below
their prevailing market values, thereby presenting us with highly attractive options to grow our owned fleet.
The recent acquisition and financing of the IVS Phoenix during the quarter is a prime example of the advantages
and benefits of this strategy.

Finally, we were pleased to complete the Company’s first capital markets secondary offering since our spin-off
and listing in 2018. The Company did not sell any shares in the offering, but it has benefited from increased daily
trading liquidity, has a stronger US institutional shareholder base, and increased market float in the US, which
has now reached over 37% of shares outstanding, as of October 2021.”


Headline earnings (loss) and Headline earnings (loss) per share

The Johannesburg Stock Exchange, or JSE, requires that we calculate and publicly disclose Headline earnings
(loss) per share and diluted Headline earnings (loss) per share. Headline earnings (loss) per share is calculated
using net income which has been determined based on IFRS. Accordingly, this may differ to the Headline
earnings (loss) per share calculation of other companies listed on the JSE because such companies may report
their financial results under a different financial reporting framework such as U.S. GAAP.

Headline earnings (loss) for the period represents profit (loss) for the period attributable to owners of the
Company adjusted for the re-measurements that are more closely aligned to the operating or trading results as
set forth below, and Headline earnings (loss) per share represents this figure divided by the weighted average
number of ordinary shares outstanding for the period.

The table below presents a reconciliation between Profit (loss) for the period attributable to owners of the
Company to Headline earnings (loss) for the three months ended September 30, 2021 and 2020 and the nine
months ended September 30, 2021 and 2020.

                                                     3
                                                                       Three months ended               Nine months ended

                                                                          September 30,                   September 30,

(In thousands of U.S. dollars, other than per share data)              2021             2020           2021           2020


Profit (loss) for the period attributable to owners of the
  Company                                                        $      43,996    $      (14,279) $      66,125 $       (24,774)

Adjusted for:

  - (Reversal of) impairment loss recognized on ships                         -            6,065          (3,557)         9,727

  - Impairment loss recognized on goodwill and intangibles                    -                -              965              -

  - Reversal of impairment loss recognized on right-of-use
     assets                                                                   -                -          (1,046)              -

  - Impairment loss on net disposal group                                     -                -           2,551             576

  - Loss on disposal of business                                              -                -              25               -



Headline earnings (loss)                                                43,996            (8,214)        65,063         (14,471)



  Weighted average number of shares on which the per share
  figures have been calculated                                       19,242,116       19,006,858      19,216,386     18,952,834

  Effect of dilutive potential ordinary shares                         863,168                 -        863,168                -

  Weighted average number of ordinary shares for the
  purpose of diluted per share figures                               20,105,284       19,006,858      20,079,554     18,952,834



  Basic profit (loss) per share                                  $         2.29   $        (0.75) $         3.44 $        (1.31)

  Diluted profit (loss) per share                                $         2.19   $        (0.75) $         3.29 $        (1.31)



  Basic headline earnings (loss) per share                       $         2.29   $        (0.43) $         3.39 $        (0.76)

  Diluted headline earnings (loss) per share                     $         2.19   $        (0.43) $         3.24 $        (0.76)




                                                             4
Interim Dividend - The relevant dates for the payment of dividend number 1 are as follows:

    Declaration date on NASDAQ                                                 Wednesday, 17 November 2021
    Declaration and Finalisation date announcement on SENS before 09:00          Thursday, 18 November 2021
    Last day to trade cum-dividend (JSE)                                          Tuesday, 30 November 2021
    Last day to trade cum-dividend (NASDAQ)                                     Wednesday, 1 December 2021
    Shares commence trading ex-dividend (JSE)                                   Wednesday, 1 December 2021
    Shares commence trading ex-dividend (NASDAQ)                                  Thursday, 2 December 2021
    Record date (JSE and NASDAQ)                                                     Friday, 3 December 2021
    Payment date (JSE and NASDAQ)                                                 Monday, 13 December 2021

Shareholders registered on the South African section of the share register will not be allowed to dematerialise
or rematerialise their shareholdings, and transfers between the NASDAQ and South African register will not be
permitted between Wednesday, 1 December 2021 and Friday, 3 December 2021, both dates inclusive.


Additional information for South African resident shareholders of Grindrod Shipping Holdings Ltd.

-       Shareholders registered on the South African branch register are advised that the distribution of US$0.72
        per ordinary shares will be converted to Rands using the USD/Rand spot rate from Nedbank Limited, as
        determined on close of business on Wednesday, 17 November 2021, of 15.45. This will equate to a gross
        dividend of ZAR 11.12400 per share.

-       Grindrod Shipping Holdings Ltd. tax reference number: 201731497H.

-       The issued ordinary share capital of Grindrod Shipping Holdings Ltd. is 19,310,024 ordinary shares and
        the Company has 124,672 treasury shares.

-       The dividend will be distributed by the Company, from distributable profit reserves and is regarded as a
        “foreign dividend” (as defined in the South African Income Tax Act No. 58 of 1962) for South African
        resident shareholders holding shares on the South African branch register.

-       Singapore does not impose withholding tax on dividends.

-       Dividends declared and paid by the Company to South African resident shareholders holding shares on
        the South African branch register are subject to South African dividend tax (“SA DWT”) of 20% (subject to
        any applicable exemptions that may apply). The net dividend to South African resident shareholder who
        are not exempt from SA Tax, equates to ZAR 8.89920 per share.

-       Dividends will be paid net of SA DWT, to be withheld and paid to the South African Revenue Service. Such
        tax must be withheld unless beneficial owners of the dividend have provided the necessary document
        proof to the regulated intermediary (being a broker, CSD participant, nominee company or the Company’s
        transfer secretaries Computershare Investor Services (Pty) Ltd., Private Bag x9000, Saxonwold, 2132,
        South Africa) that they are exempt therefrom, or entitled to a reduced rate, as a result of any relevant
        double taxation agreement between South Africa and the country of tax domicile of such owner.


                                                     5
Short-form announcement


 The full announcement includes the contents of the Report on Form 6-K as filed with the SEC on 17 November
 2021, being the earnings results of Grindrod Shipping Holdings Ltd. for the three months and nine months
 ended September 30, 2021.

 This short-form announcement is the responsibility of the directors of Grindrod Shipping Holdings Ltd. This
 short-form announcement is only a summary of the information in the full announcement and does not
 contain full or complete details. Any investment decision by investors and/or shareholders should be based
 on consideration of, inter alia, the full announcement.

 The full announcement has been released on SENS on 18 November 2021 and is available for viewing on the
 Company’s website (www.grinshipping.com) and at

 https://senspdf.jse.co.za/documents/2021/jse/isse/GSHE/GRIN3Q2021.pdf.

 The full announcement is available for inspection at the offices of the Company (200 Cantonment Road, #03-
 01 Southpoint, Singapore 089763) and the offices of the Sponsor, Grindrod Bank Limited (Grindrod Tower, 8A
 Protea Place, Sandton, 2196), at no charge during normal office hours on business days from 18 November
 2021.


Conference Call details

On Thursday, November 18, 2021, at 8:00 a.m. Eastern Time/ 3:00 p.m. South African Time/ 9:00 p.m. Singapore
Time, the Company's management will host a conference call and webcast to discuss the earnings results.

Conference Call details: Participants should dial into the call 10 minutes before the scheduled time using the
following numbers: +1 877 553 9962 (US Toll Free Dial In), +0808 238 0669 (UK Toll Free Dial In), +65 3158 5482
(Singapore Dial In), or +27 10 5003039 (South Africa Dial In), +44 (0) 2071 928592 (International Standard Dial
In). Please quote “Grindrod” to the operator.


Slides and Audio Webcast / Slides Presentation details

There will be a live, and then archived webcast of the conference call and accompanying slides, accessible
through the Grindrod Shipping website www.grinshipping.com (click on Notices & Events). The slide
presentation of the third quarter 2021 financial results will be accessible in PDF format 10 minutes prior to the
conference call and webcast. Participants to the live webcast should register on the website approximately 10
minutes prior to the start of the webcast.




                                                    6
About Grindrod Shipping Holdings Ltd.

Grindrod Shipping operates a fleet of owned and long-term and short-term chartered-in drybulk vessels
predominantly in the handysize and supramax/ultramax segments. The drybulk business, which operates under
the brand “Island View Shipping” (“IVS”), includes a Core Fleet of 31 vessels consisting of 15 handysize drybulk
carriers and 16 supramax/ultramax drybulk carriers. The Company also owns one medium range product tanker
on bareboat charter. The Company is based in Singapore, with offices in London, Durban, Tokyo, Cape Town and
Rotterdam. Grindrod Shipping is listed on NASDAQ under the ticker “GRIN” and on the JSE under the ticker
“GSH”.




Forward-Looking Statements

The statements in this press release that are not historical facts may be forward-looking statements. The Private
Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in
order to encourage companies to provide prospective information about their business. The Company desires
to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is
including this cautionary statement in connection with this safe harbor legislation. The forward-looking
statements in this press release are based upon various assumptions, including, without limitation, Grindrod
Shipping management's examination of historical trends, data contained in the Company's records and other
data available from third parties. Although the Company 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 the Company's control, the Company cannot assure you
that it will achieve or accomplish these expectations, beliefs or projections. These forward-looking statements
involve risks and uncertainties that could cause actual results to differ materially from those discussed in the
forward-looking statements. These risks and uncertainties include, among others, those discussed in Grindrod
Shipping's public filings with the SEC. Except as required by law, Grindrod Shipping undertakes no obligation to
update publicly or release any revisions to these forward-looking statements to reflect events or circumstances
after the date of this press release or to reflect the occurrence of unanticipated events.


 Company Contact:                                        Investor Relations / Media Contact:
 Martyn Wade / Stephen Griffiths                         Nicolas Bornozis / Paul Lampoutis
 CEO / CFO                                               Capital Link, Inc.
 Grindrod Shipping Holdings Ltd.                         230 Park Avenue, Suite 1536
 200 Cantonment Road, #03-01 Southpoint                  New York, N.Y. 10169
 Singapore, 089763                                       Tel.: (212) 661-7566
 Email: ir@grindrodshipping.com                          Fax: (212) 661-7526
 Website: www.grinshipping.com                           Email: grindrod@capitallink.com



By order of the Board
18 November 2021

                                                    7
Sponsor: Grindrod Bank Limited




                                 8

Date: 18-11-2021 07:45:00
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 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.

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