Tuesday, January 31, 2012

Baltic Trading Limited – Earnings Estimate For 2011 Q4

For the quarter ended December 31st, 2011, we estimate that Baltic Trading Limited (NYSE: BALT) generated net income of $2,000,000 or $0.09 basic earnings per share. We estimate that the company’s net TCE revenues for the quarter were $12,800,000 & the fleet average TCE was $15,500. We also estimate that during the fourth quarter of 2011 BALT generated EBITDA of $6,900,000.

As of December 31st, 2011, we estimate that the company had $101,250,000 in debt outstanding and a total book capitalization of $383,000,000. Its debt to capitalization ratio stood at 26.4%. We also estimate that the company had cash on hand of $9,000,000. BALT had a remaining $40,000,000 under its amended 2010 credit facility, to finance future vessel acquisitions and for working capital purposes.

The company has in the past declared variable quarterly dividends based on cash available for distribution, but also after taking into account the company’s cash flow & liquidity and capital resources. Based on cash available for distribution, we estimate that the company has the capacity to declare a quarterly dividend of $0.11 per share. In the previous three quarters BALT had declared dividends in excess of cash available for distribution. But given the rapid deterioration of spot freight markets year-to-date, with spot rates at or near cash operating levels, the company may decide to preserve some capital for future dividend distributions.

Based on today’s closing price of $4.23 per share, we estimate that BALT has a market capitalization of $96,000,000 and an enterprise value of $188,000,000.

BALT operates a modern diversified fleet of 9 dry cargo vessels, consisting of 3 handy size vessels, 4 supramax size vessels and two cape size vessels, with a total DWT capacity of approximately 672,000 MT, and an average age of 2.2 years as of December 31st, 2011.