0001140361-21-027036.txt : 20210805
0001140361-21-027036.hdr.sgml : 20210805
20210805091917
ACCESSION NUMBER: 0001140361-21-027036
CONFORMED SUBMISSION TYPE: 6-K
PUBLIC DOCUMENT COUNT: 85
CONFORMED PERIOD OF REPORT: 20210630
FILED AS OF DATE: 20210805
DATE AS OF CHANGE: 20210805
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: Castor Maritime Inc.
CENTRAL INDEX KEY: 0001720161
STANDARD INDUSTRIAL CLASSIFICATION: DEEP SEA FOREIGN TRANSPORTATION OF FREIGHT [4412]
IRS NUMBER: 000000000
STATE OF INCORPORATION: 1T
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 6-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-38802
FILM NUMBER: 211146626
BUSINESS ADDRESS:
STREET 1: CHRISTODOULOU CHATZIPAVLOU 223
STREET 2: HAWAII ROYAL GARDENS, APART. 16
CITY: LIMASSOL
STATE: G4
ZIP: 3036
BUSINESS PHONE: 357 25357767
MAIL ADDRESS:
STREET 1: CHRISTODOULOU CHATZIPAVLOU 223
STREET 2: HAWAII ROYAL GARDENS, APART. 16
CITY: LIMASSOL
STATE: G4
ZIP: 3036
6-K
1
brhc10027604_6k.htm
6-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2021
Commission File Number: 001-38802
CASTOR MARITIME INC.
(Translation of registrant’s name into English)
223 Christodoulou Chatzipavlou Street, Hawaii Royal Gardens, 3036 Limassol, Cyprus
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Note:
Regulation S-T Rule 101(b) (1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Note:
Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which
the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a
press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached to this report on Form 6-K as Exhibit 99.1 are the unaudited consolidated interim financial statements and related Management’s Discussion and Analysis of Financial Condition and Results of Operations of Castor Maritime Inc. (the “Company”) for the
six months ended June 30, 2021.
Attached to this report on Form 6-K as Exhibit 99.2 is a copy of the press release
issued by the Company on August 5, 2021, reporting the Company’s financial results for the three months and six months ended June 30, 2021.
Except for the commentary of Petros Panagiotidis, the information contained in this report on Form 6-K and the exhibits attached hereto are hereby incorporated by reference into the Company's registration statements
on Form F-3 (File Nos. 333-238990, 333-240262 and 333-254977) that were declared effective on September 23, 2020, September 23, 2020 and April 1, 2021, respectively.
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.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion of the financial condition and results of operations of Castor Maritime Inc. (“Castor”) for the six-month periods ended June 30, 2020 and 2021. Unless otherwise specified herein,
references to the “Company”, “we”, “our” and “us” or similar terms shall include Castor and its wholly owned subsidiaries. You should read the following discussion and analysis together with the unaudited interim condensed consolidated financial
statements and related notes included elsewhere in this report. Amounts relating to percentage variations in period-on-period comparisons shown in this section are derived from such unaudited interim condensed consolidated financial statements. The
following discussion contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control
which could cause actual events or conditions to differ materially from those currently anticipated and expressed or implied by such forward-looking statements. For additional information relating to our management’s
discussion and analysis of financial conditions and results of operations and a more complete discussion of the risks and uncertainties referenced in the preceding sentence, please see our Annual Report for the
year ended December 31, 2020 (the “2020 Annual Report”), which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 30, 2021. Unless otherwise defined herein, capitalized words and expressions used herein shall have the
same meanings ascribed to them in the 2020 Annual Report.
Business Overview and Fleet Information
We are a growth-oriented global shipping company that was incorporated in the Republic of the Marshall Islands in September 2017 for the purpose of acquiring, owning, chartering and operating oceangoing cargo vessels.
We are a provider of worldwide seaborne transportation services for dry bulk cargo as well as crude oil and refined petroleum products.
We currently operate a fleet of 23 vessels, consisting of 15 dry bulk carriers and 8 tankers with an aggregate cargo carrying capacity of 2.0 million dwt and an average age of 14.0 years (which we refer to throughout
this report as our “Fleet”), and, as of the date of this report, we have agreed to acquire an additional 3 dry bulk vessels from unaffiliated sellers which we expect to take delivery of in the third quarter of 2021. Upon the successful consummation
of our recent vessel acquisitions, our fleet will consist of 26 vessels, with an aggregate capacity of 2.2 million dwt, consisting of 1 Capesize, 7 Kamsarmax and 10 Panamax dry bulk vessels, as well as 1 Aframax, 5 Aframax/LR2 and 2 MR1 tankers.
We intend to continue to explore the market in order to identify potential acquisition targets which will help us grow our fleet and business. Our acquisition strategy has so far focused on secondhand Capesize,
Kamsarmax, and Panamax dry bulk vessels as well as Aframax, Aframax/LR2 and MR1 tanker vessels, although we may acquire vessels in other sizes, age and/or sectors which we believe offer attractive investment opportunities.
Our commercial strategy primarily focuses on deploying our fleet under a mix of (a) period time charters and (b) trip time charters or voyage charters, according to our assessment of market conditions, adjusting the
mix of these charters to take advantage of the stable cash flows and high utilization rates associated with period time charters or to profit from attractive spot charter rates during periods of strong freight market conditions.
Our vessels are technically managed by Pavimar S.A, or Pavimar, a company controlled by Ismini Panagiotidis, the sister of our Chairman, Chief Executive Officer and Chief Financial Officer, Petros Panagiotidis, and,
commercially managed by Castor Ships S.A, or Castor Ships, a company controlled by our Chairman, Chief Executive Officer and Chief Financial Officer.
1
The following table summarizes key information about our Fleet as of the date of this report:
Owned Vessels:
Vessel Name
Vessel Type
DWT
Year Built
Country of Construction
Delivery date to Castor
1
M/V Magic P
Panamax
76,453
2004
Japan
February 2017
2
M/V Magic Sun
Panamax
75,311
2001
Korea
September 2019
3
M/V Magic Moon
Panamax
76,602
2005
Japan
October 2019
4
M/V Magic Rainbow
Panamax
73,593
2007
China
August 2020
5
M/V Magic Horizon
Panamax
76,619
2010
Japan
October 2020
6
M/V Magic Nova
Panamax
78,833
2010
Japan
October 2020
7
M/V Magic Orion
Capesize
180,200
2006
Japan
March 2021
8
M/V Magic Venus
Kamsarmax
83,416
2010
Japan
March 2021
9
M/V Magic Argo
Kamsarmax
82,338
2009
Japan
March 2021
10
M/V Magic Twilight
Kamsarmax
80,283
2010
Korea
April 2021
11
M/V Magic Thunder
Kamsarmax
83,375
2011
Japan
April 2021
12
M/V Magic Nebula
Kamsarmax
80,281
2010
Korea
May 2021
13
M/V Magic Starlight
Kamsarmax
81,048
2015
China
May 2021
14
M/V Magic Vela
Panamax
75,003
2011
China
May 2021
15
M/V Magic Eclipse
Panamax
74,940
2011
Japan
June 2021
16
M/T Wonder Polaris
Aframax/LR2
115,341
2005
Korea
March 2021
17
M/T Wonder Sirius
Aframax/LR2
115,341
2005
Korea
March 2021
18
M/T Wonder Vega
Aframax
106,062
2005
Korea
May 2021
19
M/T Wonder Avior
Aframax/LR2
106,162
2004
Korea
May 2021
20
M/T Wonder Mimosa
MR1
37,620
2006
Korea
May 2021
21
M/T Wonder Arcturus
Aframax/LR2
106,149
2002
Korea
May 2021
22
M/T Wonder Musica
Aframax/LR2
106,209
2004
Korea
June 2021
23
M/T Wonder Formosa
MR1
37,562
2006
Korea
June 2021
Vessels we have agreed to acquire:
Vessel Type
DWT
Year Built
Country of Construction
Purchase Price (in million)
1
Kamsarmax
82,158
2013
Japan
$21.00
2
Panamax
74,940
2013
Japan
$19.06
3
Panamax
76,822
2014
Korea
$21.00
Recent Developments
Please refer to Note 15 to our unaudited interim condensed consolidated financial statements, included elsewhere herein, for developments that took place after June 30, 2021.
Vessel Acquisitions
Please refer to Note 5 to our unaudited interim condensed consolidated financial statements, included elsewhere herein, for fleet developments that took place during the six months ended June 30, 2021
and further as of the date of this report.
2
Operating results
Important Measures and Definitions for Analyzing Results of Operations
We believe that important concepts and measures for analyzing trends in our results of operations include the following:
Off-hire. The period our Fleet is unable to perform the services for which it is required under a charter for reasons such as scheduled
repairs, vessel upgrades, dry-dockings or special or intermediate surveys or other unforeseen events.
Dry-docking/Special Surveys.We
periodically dry-dock and/ or perform special surveys on our Fleet for inspection, repairs and maintenance and any modifications to comply with industry certification or governmental requirements. Our ability to control our dry-docking and special
survey expenses and our ability to complete our scheduled dry-dockings and/or special surveys on time also affects our financial results. Dry-docking and special survey costs are accounted under the deferral method whereby the actual costs incurred
are deferred and are amortized on a straight-line basis over the period through the date the next survey is scheduled to become due.
Time charter. A time charter is a contract for the use of a
vessel for a specific period of time during which the charterer pays substantially all of the voyage expenses, including port charges, bunker expenses and canal charges. The vessel owner pays the vessel operating expenses, which include crew costs,
provisions, deck and engine stores and spares, lubricants, insurance, maintenance and repairs. The vessel owner is also responsible for each vessel's dry-docking and intermediate and special survey costs. Time charter rates are usually fixed during
the term of the charter. Prevailing time charter rates do fluctuate on a seasonal and year-to-year basis and may be substantially higher or lower from a prior time charter agreement when the subject vessel is seeking to renew the time charter
agreement with the existing charterer or enter into a new time charter agreement with another charterer. Fluctuations in time charter rates are influenced by changes in spot charter rates.
Our results of operations are affected by numerous factors. Important factors that, in our view, have historically impacted our business and that are likely to continue to impact our business, are the following:
-
The levels of demand and supply of seaborne cargoes and vessel tonnage in the dry bulk and tanker shipping industries;
-
The cyclical nature of the shipping industry in general and its impact on charter rates and vessel values;
-
Utilization rates of our Fleet;
-
The employment and operation of our Fleet;
-
Management of the financial, general and administrative elements involved in the conduct of our business and ownership of our Fleet;
-
The performance of our charterers’ obligations under their charter agreements including our charterers ability to make charter payment to us;
-
Our ability to maintain solid working relationships with our existing charterers and our ability to increase the number of our charterers through the development of new working relationships;
-
The effective and efficient technical management of our Fleet by our Managers including the performance of their suppliers;
-
The vetting approvals by oil majors of our commercial and technical managers for the management of our tanker vessels;
-
Economic, regulatory, political and governmental conditions that affect shipping and the dry-bulk and tanker industries;
3
-
Dry-docking and special survey costs and duration, both expected and unexpected;
-
Our ability to successfully employ our vessels at economically attractive rates and our strategic decisions regarding the employment mix of our Fleet in the voyage, pool and time charter markets, as our
charters expire or are otherwise terminated;
-
Our ability to obtain equity and debt financing at acceptable and attractive terms to fund future capital expenditures;
-
Our access to capital required to acquire additional ships and/or to implement our business strategy;
-
The level of any distribution on all classes of our shares;
-
Management of our financial resources, including banking relationships and of the relationships with our various stakeholders;
-
Our borrowing levels and the finance costs related to our outstanding debt; and
-
Major outbreaks of diseases (such as COVID-19) and governmental responses thereto.
Employment and operation of our Fleet
A factor that impacts our profitability is the employment and operation of our Fleet. The profitable employment of our Fleet is highly dependent on the levels of demand and supply in the
dry bulk and tanker shipping industries, our commercial strategy including the decisions regarding the employment mix of our Fleet as well as our Managers’ ability to leverage our relationships with existing or potential customers. The effective
operation of our Fleet mainly requires regular maintenance and repair, effective crew selection and training, ongoing supply of our Fleet with the spares and the stores that it requires, contingency response planning, auditing of our
vessels’ onboard safety procedures, arrangements for our vessels’ insurance, chartering of the vessels, training of onboard and on shore personnel with respect to the vessels’ security and security response plans (ISPS), obtaining of ISM
certifications and performing the necessary audit for the vessels within the six months of taking over a vessel and the ongoing performance monitoring of the vessels.
Financial, general and administrative management
The management of financial, general and administrative elements involved in the conduct of our business and ownership of our Fleet, requires us to manage our financial resources, including commercial and investment
banking relationships; the efficient administration of bank accounts; manage the accounting system and records and financial reporting; monitor and ensure compliance with the legal and regulatory requirements affecting our business and assets; and
manage our relationships with our service providers and customers.
4
Selected financial information
The following tables present our selected unaudited consolidated financial information at the dates and for the periods presented. All amounts are expressed in United States Dollars except for share and per share data.
This information was derived from the unaudited interim condensed consolidated statements for the periods presented included herein. All number of share and earnings per share data in the financial information presented
below have been retroactively adjusted to reflect the reverse stock split effected on May 28, 2021.
Selected Historical Financial Data
Six Months Ended
June 30,
STATEMENT OF INCOME
(In U.S. Dollars, except for share and per share data)
2020
2021
Vessel revenues, net
$
5,310,936
$
28,762,636
Voyage expenses (including commissions to related party)
(259,600
)
(941,593
)
Vessel operating expenses
(2,604,336
)
(11,266,895
)
Depreciation and amortization
(694,372
)
(4,040,601
)
Management fees - related parties
(273,000
)
(2,524,500
)
General and administrative expenses(including related party)
(237,636
)
(1,459,355
)
Operating income
$
1,241,992
$
8,529,692
Interest and finance costs, net (including interest costs to related party)
(1,633,736
)
(840,762
)
Other expenses
(12,724
)
(12,239
)
US Source Income Taxes
—
(74,123
)
Net (Loss)/Income
$
(404,468
)
$
7,602,568
(Loss)/Earnings Per Share (basic and diluted):
$
(0.50
)
$
0.10
Weighted average number of shares outstanding, basic:
802,765
73,384,422
Weighted average number of shares outstanding, diluted:
802,765
76,203,009
December 31,
2020
June 30,
2021
BALANCE SHEET DATA
Total current assets
$
13,564,154
$
50,477,706
Vessels, net
58,045,628
300,516,947
Other non-current assets
2,761,573
15,997,848
Total assets
$
74,371,355
$
366,992,501
Total current liabilities
10,903,907
19,904,443
Long-term debt, net (including current portion, excluding related party)
13,185,866
44,274,049
Long-term debt, related party
5,000,000
5,000,000
Common stock
13,121
93,519
Total shareholders’ equity
$
52,383,619
$
309,967,419
Common shares issued and outstanding
13,121,238
93,519,255
Six Months Ended
June 30,
CASH FLOW DATA
2020
2021
Net cash (used in) /provided by operating activities
$
(390,619
)
$
7,212,014
Net cash used in investing activities
(388,635
)
(255,124,019
)
Net cash provided by financing activities
$
26,974,956
$
281,168,137
5
Set forth below are selected operational and financial statistical data of our Fleet for each of the six month periods ended June 30, 2020 and 2021 that we believe are useful in better analyzing trends
in our results of operations:
Selected Historical Operational Data
Six Months Ended
June 30,
2020
2021
FLEET PERFORMANCE DATA:
Average number of vessels in operation in period (1)
3.0
11.6
Age of vessels in operation at end of period
16.6
13.9
(1)
Represents the number of vessels that constituted our Fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our Fleet during the period divided by the number of days in the period.
Results of Operations
Six months ended June 30, 2021 compared to the six months ended June 30, 2020
Vessel revenues
Vessel revenues, net of charterers’ commissions, increased from $5.3 million in the six months ended June 30, 2020, to $28.8 million in the same period of 2021. This increase was largely driven by the acquisition and
delivery to our fleet of 20 vessels since June 30, 2021. The increase in vessel revenues during the six months ended June 30, 2021 as compared with the same period of 2020 was further underpinned by a stronger dry bulk shipping market resulting in
higher daily net revenues earned on average for our fleet as compared with this earned during the same period of 2020.
Voyage expenses
Voyage expenses increased by $0.6 million, from $0.3 million in the six months ended June 30, 2020, to $0.9 million in the corresponding period of 2021. This increase in voyage expenses is mainly associated with an
increase in brokerage commissions by $0.6 million, commensurate with the above discussed increase in vessel charter revenues.
Vessel operating expenses
The increase in operating expenses by $8.7 million, from $2.6 million in the six-month period ended June 30, 2020 to $11.3 million in same period of 2021 mainly reflect the increase in the number of vessels in our
Fleet.
General and Administrative Expenses
General and administrative expenses in the six months ended June 30, 2020 amounted to $0.2 million, whereas, in the same period of 2021 general and administrative expenses totaled $1.5 million. This increase stemmed
from incurred legal and other corporate fees primarily related to the growth of our company, and the $0.3 million quarterly flat fee we pay Castor Ships with effect from September 1, 2020.
6
Management fees- related party
Management fees in the six months ended June 30, 2020 amounted to $0.3 million, whereas, in the same period of 2021 management fees totaled $2.5 million. This increase in management fees is primarily due to the
sizeable increase of our fleet following the acquisitions discussed above, resulting in a substantial increase in the total number of calendar days in the period during which we owned our vessels for which our managers charge us with a daily
management fee. Effective September 1, 2020, the daily management fees for the technical management of our fleet by Pavimar, was increased from $500 to $600 per vessel and the daily management fees for the commercial and administrative management of
our fleet by Castor Ships was set to $250 per vessel.
Depreciation and amortization
Depreciation and amortization expenses comprise of vessels’ depreciation and the amortization of vessels’ capitalized dry-dock costs. Depreciation and amortization charges totaled $0.7
million in the six months ended June 30, 2020, as compared to $4.0 million in the six months ended June 30, 2021.
Vessels’ depreciation increased from $0.7 million in the six-months ended June 30, 2020 to $3.7 million in the six-months ended June 30, 2021, reflecting primarily the increase in the size of our Fleet.
Interest and finance costs, net
The decrease by $0.8 million in net interest and finance costs in the six months ended June 30, 2021, as compared with the previous year’s six month period, is mainly the result of having incurred during the six months
ended June 30, 2020, $1.1 million of non-cash recurring and accelerated amortization expenses related to deferred financing costs and to a beneficial conversion feature recognized in connection with our repaid,
as of the same period, $5.0 million convertible debentures.
Significant Accounting Policies
There have been no material changes to our significant accounting policies since December 31, 2020. For a description of our significant accounting policies, see Note 2 to our audited consolidated financial statements
included in our 2020 Annual Report, as supplemented by Note 2 to our interim unaudited consolidated financial statements contained elsewhere in this report.
7
Liquidity and Capital Resources
We operate in a capital-intensive industry and we expect to finance the purchase of additional vessels and other capital expenditures through a combination of proceeds from equity offerings, borrowings
from debt transactions and cash generated from operations. Our liquidity requirements relate to servicing the principal and interest on our debt, funding capital expenditures and working capital (which includes maintaining the quality of our vessels
and complying with international shipping standards and environmental laws and regulations) and maintaining cash reserves for the purpose of satisfying a certain minimum liquidity restrictions contained in our credit facilities. In accordance with
our business strategy, other liquidity needs may relate to funding potential investments and maintaining cash reserves against fluctuations in operating cash flows. Our funding and treasury activities are intended to maximize investment returns while
maintaining appropriate liquidity.
For the six months ended June 30, 2021, our principal sources of funds were the net proceeds from (i) the issuance of common stock pursuant to the three follow-on direct registered offerings we
conducted in January and April of this year, (ii) the issuance of common stock pursuant to warrant exercises under our then effective warrant schemes, (iii) the incurrence of secured debt as discussed below under "Our Borrowing Activities", (iv) the
issuance of common stock pursuant to sales under our current at-the-market common stock offering program and (v) cash flow from our operations. As of June 30, 2021 and December 31, 2020, we had cash and cash equivalents of $42.7 million and $9.4
million (which includes minimum cash restricted in both periods under our debt agreements). Cash and cash equivalents are primarily held in U.S. dollars.
As of June 30, 2021, we had $50.2 million of gross indebtedness outstanding under our debt agreements, of which $12.5 million matures in the twelve-month period ending June 30, 2022. As of June 30,
2021, we were in compliance with all the financial and liquidity covenants contained in our debt agreements.
Working capital is equal to current assets minus current liabilities. As of June 30, 2021, we had a working capital surplus of $30.6 million as compared to a working capital surplus of $2.7 million as of December 31,
2020. We believe that our current sources of funds and those that we anticipate to internally generate for a period of at least the next twelve months from the date of this report, will be sufficient to fund the operations of our Fleet, meet our
normal working capital requirements and service the principal and interest on our debt.
On November 15, 2018, we entered into a contract to purchase and install ballast water management system (“BWMS”) on our dry bulk carriers, which was further amended on October 20, 2019 and December 8, 2020, to reflect
our vessel acquisitions, as applicable in each period. We completed the BWMS installation on the Magic Sun during the vessel’s scheduled dry-docking which took place
in the fourth quarter of 2020 and the BWTS was put into use during the second quarter of 2021. The BWMS system installations on the Magic P and the Magic Moon were
granted extensions from the third quarter of 2020 to the third quarter of 2022. It is estimated that the contractual obligations related to these purchases as well as purchases on our remaining fleet vessels (where not already installed), excluding
installation costs, will be on aggregate approximately €0.6 million (or $0.7 million on the basis of a Euro/US Dollar exchange rate of €1.0000/$1.1904 as of June 30, 2021), of which $0.01 million are due in 2021 and
$0.69 million are due in 2022. These costs will be capitalized and depreciated over the remainder of the life of each vessel.
During the six months ended June 30, 2021, cash provided by operating activities in the amount of $7.2 million as compared to $0.4 million used in operating activities in the corresponding
period of 2020, which represents an increase in cash provided from operating activities of $7.6 million. This increase is largely associated with expansion of our business and the higher net revenues we earned during the six month period ended June
30, 2021.
Our Borrowing Activities
Please refer to Notes 6 and 15 to our unaudited interim condensed consolidated financial statements, included elsewhere herein, for information regarding our borrowing activities as of June 30, 2021,
and subsequent, as of the date of this report.
8
Cash Flows
The following table summarizes our net cash flows (used in)/provided from operating, investing and financing activities and our cash, cash equivalents and restricted cash for the six month periods ended June 30, 2020
and 2021:
Six months ended June 30,
(in thousands of U.S. Dollars)
2020
2021
Net cash provided by / (used in) operating activities
$
(390,619
)
$
7,212,014
Net cash used in investing activities
(388,635
)
(255,124,019
)
Net cash provided by financing activities
26,974,956
281,168,137
Cash, cash equivalents and restricted cash at beginning of period
5,058,939
9,426,903
Cash, cash equivalents and restricted cash at end of period
$
31,254,641
$
42,683,035
Operating Activities:
Net cash provided by operating activities amounted to $7.2 million for the six-month period ended June 30, 2021, consisting of net income after non-cash items of $11.7 million and a working capital cash decrease of
$4.5 million.
Net cash used in operating activities amounted to $0.4 million for the six-month period ended June 30, 2020, consisting of net income after non-cash items of $1.1 million, offset by a reduction in working capital by
$1.5 million.
The $7.6 million increase, hence, in net cash from operating activities in the six-month period ended June 30, 2021 as compared with the same period of 2020 reflects mainly the increase in net income after non-cash
items.
Investing Activities:
Net cash used in investing activities amounting to $255.1 million for the six-months ended June 30, 2021 mainly reflects the cash outflows associated with the vessel acquisitions we made during the period, as discussed
in more detail under Note 5 of our unaudited interim consolidated financial statements included elsewhere in this report, and the costs paid for the BWMS purchases on the Magic P, Magic Sun and the Magic Vela.
Net cash used in investing activities during the six-months ended June 30, 2020 amounting to $0.4 million, relates to the paid portion of the capitalized expenditures in connection the Magic P partial BWMS installation that was completed during the vessel’s dry-docking in the first quarter of 2020.
Financing Activities:
Net cash provided by financing activities during the six-months ended June 30, 2021 amounting to $281.2 million, relates to (i) the net proceeds raised under our First, Second and Third Registered Direct Equity
Offerings amounting to $157.0 million, (ii) the proceeds from the issuance of stock under our then effective warrant schemes amounting to $83.4 million, (iii) the net proceeds from the issuance of stock pursuant to the ATM Program amounting to $9.8
million, (iv) the $32.6 million net proceeds related to the secured credit facilities that we entered into during the six-months ended June 30, 2021 (as further discussed under Note 5 of the unaudited interim consolidated financial statements
included elsewhere in this report), as offset by (v) $1.6 million of period scheduled principal repayments under our secured credit facilities.
The 2020 six-month period $27.0 million cash inflow from financing activities resulted from (i) the net proceeds raised under our Underwritten Public Offering amounting to
$19.0 million and (ii) the $9.5 million cash proceeds under our $5.0 Million Convertible Debentures and the Chailease Financial Services Facility, that were offset by (i) $1.0 million of scheduled principal repayments under the Alpha Bank Facility
and the Chailease Financial Services Facility and (ii) an aggregate $0.6 million cash outflow related to deferred finance fees payments in the period.
9
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page
Unaudited Interim Consolidated Balance Sheets as of December 31, 2020 and June 30, 2021
F-2
Unaudited Interim Condensed Consolidated Statements of Comprehensive Income/(Loss) for the six months ended June 30, 2020 and 2021
F-3
Unaudited Interim Consolidated Statements of Shareholders’ Equity for the six months ended June 30, 2020 and 2021
F-4
Unaudited Interim Consolidated Statements of Cash Flows for the six months ended June 30, 2020 and 2021
F-5
Notes to Unaudited Interim Condensed Consolidated Financial Statements
F-6
F-1
CASTOR MARITIME INC.
UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS
December 31, 2020 and June 30, 2021
(Expressed in U.S. Dollars – except for share data)
ASSETS
December 31,
June 30,
CURRENT ASSETS:
Note
2020
2021
Cash and cash equivalents
$
8,926,903
$
40,032,095
Restricted Cash
6
—
400,940
Accounts receivable trade, net
1,302,218
2,799,042
Due from related party
3
1,559,132
1,831,311
Inventories
714,818
3,551,032
Prepaid expenses and other assets
1,061,083
1,720,388
Deferred charges, net
—
142,898
Total current assets
13,564,154
50,477,706
NON-CURRENT ASSETS:
Vessels, net
5
58,045,628
300,516,947
Advances for vessel acquisitions
5
—
9,243,007
Restricted cash
6
500,000
2,250,000
Due from related party
3
—
1,104,394
Prepaid expenses and other assets, non-current
200,000
441,923
Deferred charges, net
4
2,061,573
2,958,524
Total non-current assets
60,807,201
316,514,795
Total assets
$
74,371,355
$
366,992,501
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt, net
6
2,102,037
7,153,410
Current portion of long-term debt, related party
3, 6
5,000,000
5,000,000
Accounts payable
2,078,695
2,419,986
Due to related parties, current
3
1,941
198,845
Deferred revenue, net
108,125
1,516,027
Accrued liabilities (including $405,000 and $555,833 accrued interest to related party, respectively)
3
1,613,109
3,616,175
Total current liabilities
10,903,907
19,904,443
Commitments and contingencies
9
NON-CURRENT LIABILITIES:
Long-term debt, net
6
11,083,829
37,120,639
Total non-current liabilities
11,083,829
37,120,639
SHAREHOLDERS' EQUITY:
Common shares, $0.001 par value; 1,950,000,000 shares authorized; 13,121,238 shares
issued and outstanding as of December 31, 2020 and 93,519,255 issued and outstanding as of June 30, 2021
7
13,121
93,519
Preferred shares, $0.001 par value: 50,000,000 shares authorized:
7
Series A Preferred Shares- 9.75% cumulative redeemable perpetual preferred shares,
480,000 shares issued and outstanding as of December 31, 2020 and June 30, 2021, respectively
7
480
480
Series B Preferred Shares – 12,000 shares issued and outstanding as of December 31,
2020 and June 30,
2021, respectively
7
12
12
Additional paid-in capital
53,686,741
303,587,575
(Accumulated deficit)/ Retained earnings
(1,316,735
)
6,285,833
Total shareholders' equity
52,383,619
309,967,419
Total liabilities and shareholders' equity
$
74,371,355
$
366,992,501
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
F-2
CASTOR MARITIME INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
For the six months ended June 30, 2020 and 2021
(Expressed in U.S. Dollars – except for share data)
Six months ended June 30,
Note
2020
2021
REVENUES:
Vessel revenues (net of commissions to charterers of $282,059 and $1,001,426 respectively)
11
$
5,310,936
$
28,762,636
Total revenues
5,310,936
28,762,636
EXPENSES:
Voyage expenses (including $0 and $364,540
to related parties for the six months ended June 30, 2020 and 2021, respectively)
3,12
(259,600
)
(941,593
)
Vessel operating expenses
12
(2,604,336
)
(11,266,895
)
Management fees to related parties
3
(273,000
)
(2,524,500
)
Depreciation and amortization
4,5
(694,372
)
(4,040,601
)
General and administrative expenses (including $0 and $600,000 to related party for the six months ended June 30,
2020 and 2021, respectively)
13
(237,636
)
(1,459,355
)
Total expenses
(4,068,944
)
(20,232,944
)
Operating income
1,241,992
8,529,692
OTHER INCOME/ (EXPENSES):
Interest and finance costs (including $151,667 and $150,833 to related party for six months ended June 30, 2020 and 2021, respectively)
3,6, 14
(1,665,828
)
(899,003
)
Interest income
32,092
58,241
Foreign exchange losses
(12,724
)
(12,239
)
Total other expenses, net
(1,646,460
)
(853,001
)
Net (loss)/income and comprehensive (loss)/income, before taxes
$
(404,468
)
$
7,676,691
US Source Income Taxes
—
(74,123
)
Net (loss)/income and comprehensive (loss)/income
$
(404,468
)
$
7,602,568
(Loss)/ Earnings per common share, basic and diluted
10
$
(0.50
)
$
0.10
Weighted average number of common shares, basic
802,765
73,384,422
Weighted average number of common shares, diluted
802,765
76,203,009
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
F-3
CASTOR MARITIME INC.
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
For the six months ended June 30, 2020 and 2021
(Expressed in U.S. Dollars – except for share data)
Number of shares issued
Common
shares
Preferred
A shares
Preferred
B shares
Par
Value of
Shares
issued
Additional
Paid-in
capital
Retained earnings
/(Accumulated Deficit)
Total
Shareholders' Equity
Balance, December 31, 2019
331,811
480,000
12,000
824
12,766,389
436,798
13,204,011
- Issuance of common stock pursuant to the $5.0 Million Convertible Debentures (Notes 6,7)
804,208
—
—
804
5,056,969
—
5,057,773
- Issuance of common stock pursuant to the June Equity Offering, net of issuance costs (Note 7)
5,908,269
—
—
5,908
18,597,157
—
18,603,065
- Beneficial conversion feature pursuant to the issuance of the $5.0 Million Convertible Debentures (Note 6)
—
—
—
—
532,437
—
532,437
-Net loss
—
—
—
—
—
(404,468
)
(404,468
)
Balance, June 30, 2020
7,044,288
480,000
12,000
7,536
36,952,952
32,330
36,992,818
Balance, December 31, 2020
13,121,238
480,000
12,000
13,613
53,686,741
(1,316,735
)
52,383,619
- Issuance of
common stock pursuant to the registered direct offerings (Note 7)
42,405,770
—
—
42,406
156,824,134
—
156,866,540
- Issuance of common stock pursuant to warrant exercises (Note 7)
34,428,840
—
—
34,429
83,386,517
—
83,420,946
- Issuance of common stock pursuant to the ATM Program (Note 7)
3,563,407
—
—
3,563
9,690,183
—
9,693,746
-Net income
—
—
—
—
—
7,602,568
7,602,568
Balance, June 30, 2021
93,519,255
480,000
12,000
94,011
303,587,575
6,285,833
309,967,419
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
F-4
CASTOR MARITIME INC.
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2020 and 2021 (Expressed in U.S. Dollars)
Note
Six months ended June 30,
2020
2021
Cash Flows (used in)/provided by Operating Activities:
Net (loss)/income
$
(404,468
)
$
7,602,568
Adjustments to reconcile net (loss)/income to net cash (used in)/provided by Operating activities:
Vessels' depreciation and amortization of deferred dry-docking costs
4,5
694,372
4,040,601
Amortization and write-off of deferred finance charges
14
541,441
125,234
Amortization of other deferred charges
112,508
53,449
Deferred revenue amortization
(430,994
)
(157,076
)
Interest settled in common stock
57,773
—
Amortization and write-off of convertible notes beneficial conversion feature
532,437
—
Changes in operating assets and liabilities:
Accounts receivable trade
(705,003
)
(1,496,824
)
Inventories
(47,380
)
(2,836,214
)
Due from/to related parties
288,538
(1,179,669
)
Prepaid expenses and other assets
(260,596
)
(901,228
)
Dry-dock costs paid
(509,976
)
(1,288,364
)
Other deferred charges
—
(196,347
)
Accounts payable
(179,960
)
515,337
Accrued liabilities
(17,290
)
1,365,569
Deferred revenue
(62,021
)
1,564,978
Net Cash (used in)/provided by Operating Activities
(390,619
)
7,212,014
Cash flow used in Investing Activities:
Vessel acquisitions and other vessel improvements
5
(388,635
)
(245,945,567
)
Advances for vessel acquisitions
5
—
(9,178,452
)
Net cash used in Investing Activities
(388,635
)
(255,124,019
)
Cash flows provided by Financing Activities:
Gross proceeds from issuance of common stock and warrants
7
20,671,500
262,516,826
Common stock issuance expenses
(1,637,559
)
(12,311,638
)
Proceeds from long-term debt
6
9,500,000
33,290,000
Repayment of long-term debt
6
(950,000
)
(1,571,000
)
Payment of deferred financing costs
(608,985
)
(756,051
)
Net cash provided by Financing Activities
26,974,956
281,168,137
Net increase in cash, cash equivalents, and restricted cash
26,195,702
33,256,132
Cash, cash equivalents and restricted cash at the beginning of the period
5,058,939
9,426,903
Cash, cash equivalents and restricted cash at the end of the period
$
31,254,641
$
42,683,035
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents
$
30,754,641
$
40,032,095
Restricted cash
500,000
2,650,940
Cash, cash equivalents, and restricted cash
$
31,254,641
$
42,683,035
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest
354,433
400,907
Shares issued in connection with the settlement of the $5.0 Million
Convertible Debentures
5,057,773
—
Unpaid capital raising costs (included in Accounts payable and Accrued Liabilities)
430,876
223,956
Unpaid vessel acquisition and other vessel improvement costs (included in Accounts payable and Accrued liabilities)
104,654
869,876
Unpaid advances for vessel acquisitions (included in Accounts payable and Accrued Liabilities)
—
64,555
Unpaid deferred dry-dock costs (included in Accounts payable and Accrued liabilities)
—
869,951
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
F-5
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
1.
Basis of Presentation and General
information:
Castor
Maritime Inc. (“Castor”) was incorporated in September 2017 under the laws of the Republic of the Marshall Islands. The accompanying consolidated financial statements include the accounts of Castor and its wholly-owned subsidiaries (collectively, the “Company”).
The Company is engaged in the worldwide transportation of ocean-going cargoes through its vessel-owning subsidiaries. On December 21,
2018, Castor’s common shares began trading on the Norwegian OTC and on February 11, 2019, they began trading on the Nasdaq Capital Market, or Nasdaq, under the symbol “CTRM”. As of June 30, 2021, Castor was controlled by Thalassa Investment Co. S.A. (“Thalassa”) by virtue of the 100% Series B preferred shares owned by it and, as a result, could control the outcome of matters on which shareholders are entitled to vote. Thalassa
is controlled by Petros Panagiotidis, the Company's Chairman, Chief Executive Officer and Chief Financial Officer.
Pavimar
S.A., a corporation incorporated under the laws of the Republic of the Marshall Islands (“Pavimar”), a related party controlled by the sister of Petros Panagiotidis, Ismini Panagiotidis, provides technical, crew and operational management services to the Company.
Castor
Ships S.A., a corporation incorporated under the laws of the Republic of the Marshall Islands (“Castor Ships”), a related party controlled by the Company’s Chairman, Chief Executive Officer and Chief Financial Officer, manages overall the Company’s business and provides commercial shipmanagement, chartering and administrative
services to the Company.
As of June 30, 2021, the Company owned a diversified fleet of 23 vessels, with a combined carrying capacity of 2.0 million
dwt, consisting of 1 Capesize, 6
Kamsarmax and 8 Panamax dry bulk vessels, as well as 1 Aframax, 5 Aframax/LR2 and 2 MR1 tankers. Details of the Company’s vessel owning subsidiary companies as of June 30, 2021 are listed below.
Vessel owning
subsidiaries consolidated:
Company
Country of incorporation
Vessel Name
DWT
Year Built
Delivery date to Castor
Spetses Shipping Co. (“Spetses”)
Marshall Islands
M/V Magic P
76,453
2004
February 2017
Bistro Maritime Co. (“Bistro”)
Marshall Islands
M/V Magic Sun
75,311
2001
September 2019
Pikachu Shipping Co. (“Pikachu”)
Marshall Islands
M/V Magic Moon
76,602
2005
October 2019
Bagheera Shipping Co. (“Bagheera”)
Marshall Islands
M/V Magic Rainbow
73,593
2007
August 2020
Pocahontas Shipping Co. (“Pocahontas”)
Marshall Islands
M/V Magic Horizon
76,619
2010
October 2020
Jumaru Shipping Co. (“Jumaru”)
Marshall Islands
M/V Magic Nova
78,833
2010
October 2020
Super Mario Shipping Co. (“Super Mario”)
Marshall Islands
M/V Magic Venus
83,416
2010
March 2021
Pumba Shipping Co. (“Pumba”)
Marshall Islands
M/V Magic Orion
180,200
2006
March 2021
Kabamaru Shipping Co. (“Kabamaru”)
Marshall Islands
M/V Magic Argo
82,338
2009
March 2021
Luffy Shipping Co. (“Luffy”)
Marshall Islands
M/V Magic Twilight
80,283
2010
April 2021
Liono Shipping Co. (“Liono”)
Marshall Islands
M/V Magic Thunder
83,375
2011
April 2021
Stewie Shipping Co. (“Stewie”)
Marshall Islands
M/V Magic Vela
75,003
2011
May 2021
Snoopy Shipping Co. (“Snoopy”)
Marshall Islands
M/V Magic Nebula
80,281
2010
May 2021
Mulan Shipping Co. (“Mulan”)
Marshall Islands
M/V Magic Starlight
81,048
2015
May 2021
Cinderella Shipping Co. (“Cinderella”)
Marshall Islands
M/V Magic Eclipse
74,940
2011
June 2021
Rocket Shipping Co. (“Rocket”)
Marshall Islands
M/T Wonder Polaris
115,341
2005
March 2021
Gamora Shipping Co. (“Gamora”)
Marshall Islands
M/T Wonder Sirius
115,341
2005
March 2021
Starlord Shipping Co. (“Starlord”)
Marshall Islands
M/T Wonder Vega
106,062
2005
May 2021
Hawkeye Shipping Co. (“Hawkeye”)
Marshall Islands
M/T Wonder Avior
106,162
2004
May 2021
Elektra Shipping Co. (“Elektra”)
Marshall Islands
M/T Wonder Arcturus
106,149
2002
May 2021
Vision Shipping Co. (“Vision”)
Marshall Islands
M/T Wonder Mimosa
37,620
2006
May 2021
Colossus Shipping Co. (“Colossus”)
Marshall Islands
M/T Wonder Musica
106,209
2004
June 2021
Xavier Shipping Co. (“Xavier”)
Marshall Islands
M/T Wonder Formosa
37,562
2006
June 2021
F-6
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
1.
Basis of Presentation and General information (continued):
The
accompanying unaudited interim condensed consolidated financial statements include the accounts of Castor and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and applicable rules and regulations of the
U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. These statements and the accompanying
notes should be read in conjunction with the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2020, filed with the SEC on March 30, 2021 (the “2020 Annual Report”).
These
unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments
considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. Operating results for the six-month period ended June 30, 2021 are not necessarily indicative of the
results that might be expected for the fiscal year ending December 31, 2021.
2.
Significant Accounting Policies and
Recent Accounting Pronouncements:
A discussion of the Company's significant
accounting policies can be found in the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report. Apart from the below, there have been no material changes to these policies in the six-month
period ended June 30, 2021.
New significant accounting policies adopted
during the six months ended June 30, 2021
Segment Reporting
The Company reports financial information and evaluates its operations by charter revenues and not by the length, type of vessel or type of ship employment for its customers,
i.e. time or voyage charters. The Company does not use discrete financial information to evaluate the operating results for each such type of charter or vessel. Although revenue can be identified for these types of charters or vessels, management
cannot and does not identify expenses, profitability or other financial information for these various types of charters or vessels. As a result, management, including the chief operating decision
maker, reviews operating results solely by revenue per day and operating results of the fleet, and thus the Company has determined that it operates as one
reportable segment. Furthermore, when the Company charters a vessel to a charterer, the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographic information is impracticable.
Recent Accounting Pronouncements
There are no recent accounting pronouncements the adoption of which are expected to have a material effect on the Company’s unaudited interim consolidated
condensed financial statements in the current period.
F-7
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
3.
Transactions with Related Parties:
During the six month
periods ended June 30, 2020 and 2021, the Company incurred the following charges in connection with related party transactions, which are included in the accompanying unaudited interim condensed consolidated statements of comprehensive income/
(loss):
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Management fees-related parties
Management fees – Pavimar (a)
$
273,000
$
1,782,000
Management fees – Castor Ships (c)
—
742,500
Included in Voyage expenses
Charter hire commissions – Castor Ships (c)
$
—
$
364,540
Included in Interest and finance costs
Interest expenses (b) – Thalassa
$
151,667
$
150,833
Included in General and administrative expenses
Administration fees – Castor Ships (c)
$
—
$
600,000
Included in Vessels’ cost
Sale & purchase commission – Castor Ships (c)
$
—
$
2,426,800
As of December 31, 2020
and June 30, 2021, balances with related parties consisted of the following:
December 31, 2020
June 30, 2021
Assets:
Working capital advances granted to Pavimar (a) – current
$
1,559,132
$
1,831,311
Working capital advances granted to Pavimar (a) – non-current
—
1,104,394
Liabilities:
Related party debt (b) – Thalassa
$
5,000,000
$
5,000,000
Accrued loan interest (b) – Thalassa
405,000
555,833
Voyage commissions & management fees due to Castor Ships (c)
1,941
97,445
Management fees due to Pavimar (a)
—
101,400
(a)
Pavimar:
Each of the Company’s ship-owning subsidiaries have entered into separate vessel management agreements with Pavimar, a company controlled by Ismini Panagiotidis, the sister of Petros
Panagiotidis (see Note 1). Pursuant to the terms of the management agreements, Pavimar provides the Company with a wide range of shipping services, including crew management, technical management, operational employment management, insurance
arrangements, provisioning, bunkering, vessel accounting and audit support services, in exchange for a daily fee. During the six month period ended June 30,
2020, the Company’s vessels then comprising its fleet were charged with a daily management fee of $500 per day per vessel.
F-8
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
3.
Transactions with Related Parties (continued):
On September 1, 2020, the Company’s then shipowning subsidiaries entered into revised
shipmanagement agreements with Pavimar which replaced the then existing shipmanagement agreements in their entirety (the “Technical Management Agreements”). Pursuant to the Technical Management Agreements, effective September 1, 2020, Pavimar
provides the Company’s shipowning subsidiaries with the range of technical, crewing, insurance and operational services stipulated in the previous agreements in exchange for which Pavimar is now paid a daily fee of $600 per vessel, which shall be also subject to an annual review on their anniversary date. The Technical Management Agreements have a term of five years and such
term automatically renews for a successive five year term on each anniversary of their effective date, unless the agreements are terminated earlier in accordance with the
provisions contained therein. In the event that the Technical Management Agreements are terminated by the ship-owning subsidiaries other than by reason of default by Pavimar, a termination fee equal to four times the total amount of the daily management fee calculated on an annual basis shall be payable from the ship-owning subsidiaries to Pavimar.
As of June 30, 2021, Pavimar has subcontracted the technical management of three
of the Company’s dry bulk vessels and eight of its tanker vessels to third-party ship-management companies. These third-party management
companies provide technical management to the respective vessels for a fixed annual fee which is paid by Pavimar at its own expense. In connection with the subcontracting services rendered by the third-party ship-management companies, the Company
has as of June 30, 2021 paid Pavimar working capital guarantee deposits aggregating the amount of $1,362,646, of which $258,252 are included in Due from related party, current and $1,104,394 are presented in Due from related party, non-current in the accompanying unaudited interim consolidated balance sheets.
During the six months ended June 30, 2020 and 2021, the Company incurred management fees under the Technical Management Agreements amounting to$273,000 and $1,782,000, respectively, which are separately presented in Management fees to related parties in the accompanying unaudited interim
condensed consolidated statements of comprehensive income/(loss).
In addition, Pavimar and its subcontractor third-party managers make payments for operating expenses
with funds paid in advance from the Company to Pavimar. As of December 31, 2020 and June 30, 2021, amounts of $1,559,132 and $1,573,059, respectively, were due from Pavimar in relation to these working capital advances granted to it, net of payments
made by Pavimar on behalf of the Company vessels.
(b) Thalassa:
$5.0 Million Term Loan Facility
Details of the Company’s loan agreement
with Thalassa are discussed in Note
3 of the consolidated financial statements for the year ended December 31, 2020,
included in the Company’s 2020 Annual Report.
During the six months ended June 30, 2020 and 2021, the Company incurred interest costs in connection with the $5.0 million unsecured term loan with Thalassa (the “$5.0 Million Term Loan
Facility”) amounting to $151,667and $150,833, which are included in Interest and finance costs in the accompanying unaudited interim consolidated statements of comprehensive
income/(loss).
As of June 30, 2021, no amounts were prepaid under the $5.0
Million Term Loan Facility.
F-9
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
3.
Transactions with Related Parties (continued):
(c) Castor Ships:
On September 1, 2020, the Company and its shipowning subsidiaries entered into a master management agreement (the “Master Agreement”) with Castor Ships. Pursuant to the terms
of the Master Agreement each of the Company’s shipowning subsidiaries also entered into separate commercial shipmanagement agreements with Castor Ships (the “Commercial Shipmanagement Agreements” and together with the Master Agreement, the “Castor
Ships Management Agreements”). Under the terms of the Castor Ships Management Agreements, Castor Ships manages overall the Company’s business and provides commercial shipmanagement, chartering and administrative services, including, but not limited
to, securing employment for the Company’s fleet, arranging and supervising the vessels’ commercial operations, handling all the Company’s vessel sale and purchase transactions, undertaking related shipping project and management advisory and
support services, as well as other associated services requested from time to time by the Company and its shipowning subsidiaries. In exchange for these services, the Company and its subsidiaries pay Castor Ships (i) a flat quarterly management fee
in the amount of $0.3 million for the management and administration of the Company’s business, (ii) a daily fee of $250 per vessel for the provision of the services under the Commercial Shipmanagement Agreements, (iii) a commission rate of 1.25% on all charter agreements arranged by Castor Ships and (iv) a commission of 1% on each vessel sale and purchase transaction.
The Castor Ships Management Agreements have a term of five years
and such term automatically renews for a successive five year term on each anniversary of the effective date, unless the agreements are
terminated earlier in accordance with the provisions contained therein. In the event that the Castor Ships Management Agreements are terminated by the Company, or are terminated by Castor Ships due to a material breach of the Master Agreement by
the Company or a change of control in the Company, Castor Ships shall be entitled to a termination fee equal to four times the total
amount of the flat management fee and the per vessel management fees calculated on an annual basis. The Commercial Shipmanagement Agreements also provide that the management fees shall be subject to an annual review on their anniversary.
During the six month period ended June 30, 2021, the Company
incurred (i) management fees amounting to $600,000 for the management and administration of the Company’s business, which are included in
General and administrative expenses in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss), (ii) management fees amounting to $742,500 for the provision of the services under the Commercial Shipmanagement Agreements which are included in Management fees to related parties in the accompanying unaudited
interim condensed consolidated statements of comprehensive income/(loss), (iii) charter hire commissions amounting to $364,540 which are
included in Voyage expenses in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss) and (iv) sale and purchase commission amounting to $2,426,800 which is included in Vessels, net in the accompanying unaudited interim consolidated balance sheet.
4.
Deferred charges, net:
The movement in
deferred dry-docking costs, net in the accompanying unaudited interim consolidated balance sheets, is as follows:
Dry-docking
costs
Balance December 31, 2020
$
2,061,573
Additions
1,250,632
Amortization
(353,681
)
Balance June 30, 2021
$
2,958,524
On November 27, 2020, the Magic Moon commenced its scheduled dry-dock
which was completed on January 13, 2021 and, on May 11, 2021 the Magic Rainbow commenced its scheduled dry-dock
which was completed on June 7, 2021. The Wonder Mimosa was undergoing dry-dock as of
June 30, 2021. Amortization of deferred dry-docking costs is included in Depreciation and amortization in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss).
F-10
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
5.
Vessels, net/ Advances for vessel acquisitions:
(a) Vessels, net:
The amounts in the accompanying unaudited interim consolidated balance sheets are analyzed as follows:
Vessel Cost
Accumulated depreciation
Net Book Value
Balance December 31, 2020
60,906,094
(2,860,466
)
58,045,628
— Acquisitions, improvements and other vessel costs
213,027,388
—
213,027,388
—Transfers from Advances for vessel acquisitions
33,130,851
—
33,130,851
—Period depreciation
—
(3,686,920
)
(3,686,920
)
Balance June 30, 2021
307,064,333
(6,547,386
)
300,516,947
Vessel Acquisitions and other Capital Expenditures:
During the six month period ended June 30, 2021, the
Company agreed to acquire 12 dry bulk carriers and 8 tanker vessels for an aggregate cash consideration of $303.7 million (the
“2021 Vessel Acquisitions”). Of the 2021 Vessel Acquisitions, 17 were concluded during the six months ended June 30, 2021, whereas, the remaining are expected to be concluded in the third quarter of 2021. The concluded acquisitions were
financed in their entirety with cash on hand. Details regarding the 2021 Vessel Acquisitions delivered as of June 30, 2021,
are discussed below.
On January 20, 2021, the Company, through Pumba, entered into an agreement to purchase
a 2006 Japanese-built Capesize dry bulk carrier, the Magic Orion, from an unaffiliated third party for a purchase price of $17.5 million. The Magic Orion was delivered to the Company on March 17, 2021.
On January 28, 2021, the Company, through Super Mario, entered into an agreement to purchase a 2010 Japanese-built Kamsarmax dry bulk
carrier, the Magic Venus, from an unaffiliated third party
for a purchase price of $15.89 million. The Magic Venus was delivered to the Company on March 2, 2021.
On February 2, 2021, the Company, through Kabamaru, entered into an agreement to purchase a 2009 Japanese-built Kamsarmax dry bulk carrier,
the Magic Argo, from an unaffiliated third party for a
purchase price of $14.5 million. The Magic Argo was delivered to the Company on March 18, 2021.
On February 5, 2021, the Company, through Rocket and Gamora, entered into agreements to purchase two 2005 Korean-built Aframax LR2 tankers, the Wonder Polaris and the Wonder Sirius, for an aggregate purchase price of $27.2 million from an unaffiliated third-party seller. The Wonder Polaris and the Wonder Sirius were delivered to the Company on March 11, 2021 and March 22, 2021, respectively.
On February 18, 2021, the Company, through Luffy, entered into an agreement to purchase a 2010 Korean-built Kamsarmax dry bulk carrier, the Magic Twilight, from an unaffiliated third party for a purchase price of
$14.8 million. The Magic
Twilight was delivered to the Company on April 9, 2021.
On March 9, 2021, the Company, through Snoopy, entered into an agreement to purchase a 2010 Korean-built Kamsarmax dry bulk carrier, the Magic Nebula, from an unaffiliated third party for a purchase price of $15.5 million. The Magic Nebula was delivered to the Company on May 20, 2021.
F-11
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
5.
Vessels, net/ Advances for vessel acquisitions (continued):
On March 11, 2021, the Company, through Liono, entered into an agreement to purchase a 2011 Japanese-built Kamsarmax dry bulk carrier, the Magic Thunder, from an unaffiliated third party for a purchase price of $16.9 million. The Magic Thunder was delivered to the Company on April 13, 2021.
On April 9, 2021, the Company, through Cinderella, entered into an agreement to purchase a 2011 Japanese-built Panamax dry bulk carrier, the Magic Eclipse, from an unaffiliated third party for a purchase price of $18.5 million. The Magic Eclipse was delivered to the Company on June 7, 2021.
On April 15, 2021, the Company, through Mulan, entered into an agreement to purchase a 2015 Chinese-built Kamsarmax dry bulk carrier, the Magic Starlight, from an unaffiliated third party for a purchase price of
$23.5 million. The Magic
Starlight was delivered to the Company on May 23, 2021.
On April 16, 2021, the Company, through Starlord, entered into an agreement to purchase a 2005 Korean-built Aframax tanker, the Wonder Vega, from an unaffiliated third party for a purchase price of $14.8 million. The Wonder Vega was delivered to the Company on May 21, 2021.
On April 27, 2021, the Company, through Stewie, entered
into an agreement to purchase a 2011 Chinese-built Panamax dry bulk carrier, the Magic Vela, from an unaffiliated third party for a purchase price of $14.5 million. The Magic Vela was delivered to the Company on May 12, 2021.
On April 29, 2021, the Company, through Vision, Xavier, Hawkeye, Colossus and Elektra,
entered into separate agreements for the en bloc acquisition from an unaffiliated third party of a tanker fleet comprising of two 2006 Korean-built MR1 tankers, two 2004 Korean-built Aframax/LR2
tankers and one 2002 Korean-built Aframax/LR2 tanker for an aggregate purchase price
of $49.3 million. The Wonder Avior, Wonder Mimosa,
Wonder Arcturus, Wonder Musica and Wonder Formosa were
delivered to the Company on May 27, May 31, May 31, June 15 and June 22, 2021, respectively.
During the six months ended June 30,
2021, the Company incurred aggregate vessel improvement costs of $0.9 million related to (i) the partial installation of a ballast
water management system (“BWMS”) on the Wonder Mimosa that was undergoing dry dock as of June 30, 2021, and (ii) the $349,287 consideration paid for the already installed BWMS of the Magic Vela upon completion of its acquisition from the Company.
As of June 30, 2021, 8
of the 23 vessels in the Company’s fleet having an aggregate carrying value of $75,644,907 were first priority mortgaged as collateral to their loan facilities (Note 6).
(b) Advances for vessel acquisitions
The amounts in the accompanying unaudited interim consolidated balance sheets are analyzed as follows:
Vessel Cost
Balance December 31, 2020
$
—
— Advances for vessel acquisitions and other vessel pre-delivery costs
42,373,858
—Transfer to Vessels, net (a)
(33,130,851
)
Balance June 30, 2021
$
9,243,007
During the six months ended June 30, 2021, the Company took delivery of a number of the vessels discussed under (a) above and, hence, advances paid in the period for these vessels
were transferred from Advances for vessel acquisitions to Vessels, net.
F-12
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
6.
Long-Term Debt:
The amount of long-term debt (including related party debt discussed under Note 3) shown in the accompanying unaudited interim consolidated balance sheet of June 30, 2021, is analyzed as follows:
Year/Period Ended
Loan facilities
Borrowers- Issuers
December 31,
2020
June 30,
2021
$11.0Million Term Loan Facility (a)
Spetses- Pikachu
$
9,400,000
$
8,600,000
$4.5Million Term Loan Facility (b)
Bistro
4,050,000
3,750,000
$15.3 Million Term Loan Facility (c)
Pocahontas- Jumaru
—
14,819,000
$18.0
Million Term Loan Facility (d)
Rocket- Gamora
—
18,000,000
Total long-term debt
$
13,450,000
$
45,169,000
Less: Deferred financing costs
(264,134
)
(894,951
)
Total long-term debt, net of deferred finance costs
$
13,185,866
44,274,049
Presented:
Current portion of long-term debt
$
2,200,000
$
7,484,000
Less: Current portion of deferred finance costs
(97,963
)
(330,590
)
Current portion of long-term debt, net of deferred finance costs
$
2,102,037
$
7,153,410
Non-Current portion of long-term debt
11,250,000
37,685,000
Less: Non-Current portion of deferred finance costs
(166,171
)
(564,361
)
Non-Current portion of long-term debt, net of deferred finance costs
$
11,083,829
$
37,120,639
Debt instruments from related party
$5.0 Million Term Loan Facility (Note 3(b))
Castor
5,000,000
5,000,000
Total long-term debt from related party, current
$
5,000,000
$
5,000,000
a.
$11.0 Million Term Loan Facility:
Details of the
Company’s $11.0 million senior secured credit facility with Alpha Bank A.E, or the $11.0 Million Term Loan Facility, are discussed in (Note 6) of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual
Report.
b.
$4.5Million Term Loan Facility:
Details of the Company’s $4.5 million senior secured credit facility with Chailease International Financial Services Co. Ltd., or the $4.5 Million Term Loan Facility, are discussed in
(Note 6) of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report.
F-13
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
6.
Long-Term Debt (continued):
c.
$15.3 Million Term Loan Facility
On January 22, 2021, pursuant to the terms of a credit agreement, Pocahontas and Jumaru, the Company’s wholly-owned subsidiaries, entered into a $15.3 million senior secured term loan facility with Hamburg Commercial Bank AG, or the $15.3
Million Term Loan Facility. The loan was drawn down on January 27, 2021, is repayable in sixteen (16) equal quarterly installments of $471,000 each, plus a balloon installment in the amount of $7.8
million payable at maturity and bears interest at a margin plus LIBOR per annum. The facility contains a standard security package including first preferred mortgages on the vessels, pledge of bank accounts, charter assignments, shares pledge and a
general assignment over the vessels' earnings, insurances and any requisition compensation in relation to the vessels owned by the borrowers, and is guaranteed by the Company. Pursuant to the terms of the $15.3 Million Term Loan Facility, the Company is also subject to a certain minimum liquidity restriction requiring the borrowers to maintain a certain credit balance with the
lender (the “Minimum Liquidity Accounts”), to maintain and gradually fund certain dry-dock reserve accounts (the “Dry-dock Reserve Accounts”) in order to ensure the payment of any costs incurred in relation to the next dry-docking of each mortgaged
vessel, as well as to certain customary, for this type of facilities, negative covenants. The credit agreement governing the $15.3
Million Term Loan Facility also requires maintenance of a minimum security cover ratio being the aggregate amount of (i) the fair market value of the collateral vessels, (ii) the value of the Minimum Liquidity Accounts, (iii) the value of the
Dry-dock Reserve Accounts and (iv) any additional security provided, over the aggregate principal amount outstanding of the loan.
The $15.3 Million
Term Loan Facility net proceeds were used to fund the 2021 Vessel Acquisitions (Note 5(a)) and for general corporate purposes.
d.
$18.0 Million Term Loan Facility
On April 27, 2021, the Company, through Rocket and Gamora, its
wholly-owned subsidiaries owning the Wonder Sirius and the Wonder Polaris (the
“Borrowers”), entered into a $18.0 million senior secured term loan facility with Alpha Bank A.E., or the $18.0 Million Term Loan Facility. The facility was drawn down on May 7, 2021. The $18.0 Million Term Loan Facility has a term of four years from the drawdown
date, bears interest at a margin over LIBOR per annum and is repayable in (a) sixteen (16) quarterly installments (1 to 4 in the amount of $850,000 and 5 to 16 in the amount of $675,000)
and (b) a balloon installment in the amount of $6.0 million payable at maturity. The facility is secured by first preferred mortgage and
first priority general assignment covering earnings, insurances and requisition compensation over the vessels owned by the Borrowers, an earnings account pledge, shares security deed relating to the shares of the vessels’ owning subsidiaries,
manager’s undertakings and is guaranteed by the Company. The $18.0 Million Term Loan Facility net proceeds were used to fund the 2021 Vessel Acquisitions (Note 5(a)) and for general corporate purposes. The $18.0 Million Term Loan Facility contains certain customary minimum liquidity restrictions and financial covenants that require the Borrowers to maintain a certain level of minimum free
liquidity per collateralized vessel (“the Minimum Liquidity Deposit”) and meet a specified minimum security requirement ratio, which is the ratio of the aggregate market value of the mortgaged vessels plus the value of any additional security and
the value of the Minimum Liquidity Deposit to the aggregate principal amounts due under the $18.0 Term Loan Facility.
As of June 30, 2021, the Company was in compliance with all financial covenants prescribed in its debt agreements.
F-14
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
6.
Long-Term Debt (continued):
Restricted cash as of June 30, 2021 includes (i) $2.2 million of minimum liquidity deposits required pursuant to the $11.0 Million Term Loan
Facility, the $18.0 Million Term Loan Facility and the $15.3 Million Term Loan Facility, (ii) $0.05 million in the Dry-dock Reserve
Accounts and (iii) $0.4 million of retention deposits.
Restricted cash as of December 31, 2020, includes $0.5 million of non-legally restricted cash as per the $11.0 Million Term Loan Facility minimum
liquidity requirements, or $0.25 million per collateralized vessel.
The annual principal payments for the Company’s outstanding debt arrangements as of June 30, 2021 (including related party debt
discussed under Note 3), required to be made after the balance sheet date, are as follows:
Twelve-month period ending June 30,
Amount
2022
$
12,484,000
2023
6,784,000
2024
6,784,000
2025
24,117,000
Total long-term debt (including related party debt)
$
50,169,000
The weighted average interest rate on the Company’s long-term debt for the six months ended June 30, 2020 and 2021 was 5.4%
and 4.0% respectively.
Total interest incurred on long-term debt for the six months ended June 30, 2020 and 2021, amounted to $583,996 and $730,851 respectively, and is included in Interest and finance costs (Note 14) in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss).
7.
Equity Capital Structure:
Under the Company's
articles of incorporation, the Company's authorized capital stock consists of 2,000,000,000 shares, par value $0.001 per share, of which 1,950,000,000
shares are designated as common shares and 50,000,000 shares are designated as preferred shares. For a further description of the
terms and rights of the Company’s capital stock and details of its previous equity transactions please refer to Note 7 of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report.
2021 First Registered
Direct Equity Offering
On December 30, 2020,
the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 9,475,000
common shares and warrants to purchase up to 9,475,000 common shares (the “2021 First Private Placement Warrants”) in a registered
direct offering or the 2021 First Registered Direct Equity Offering. In connection with the 2021 First Registered Direct Equity Offering, which closed on January 5, 2021, the Company received gross and net cash proceeds of approximately $18.0 million and $16.5 million,
respectively.
The 2021 First Private
Placement Warrants issued in the 2021 First Registered Direct Equity Offering had a term of five years and were exercisable immediately
and throughout their term for $1.90 per common share (American style option). The exercise price of the 2021 First Private Placement
Warrants was subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
As of February 10,
2021, all the 2021 First Private Placement Warrants had been exercised, and, pursuant to their exercise and the issuance by the Company of 9,475,000
common shares, the Company received gross and net proceeds of $18.0 million.
F-15
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
7.
Equity Capital Structure (continued):
On initial recognition
the fair value of the 2021 First Private Placement Warrants was $22.2 million and was determined using the Black-Scholes methodology. The
fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 First Private Placement Warrants
was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 First Private Placement Warrants valuation
was 137.5%. A 5%
increase in the volatility applied would have led to an increase of 1.7% in the fair value of the 2021 First Private Placement Warrants.
2021 Second Registered
Direct Equity Offering
On January 8, 2021, the
Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 13,700,000
common shares and warrants to purchase up to 13,700,000 common shares (the “2021 Second Private Placement Warrants”) in a registered
direct offering or the 2021 Second Registered Direct Equity Offering. In connection with the 2021 Second Registered Direct Equity Offering, which closed on January 12, 2021, the Company received gross and net cash proceeds of approximately $26.0 million and $24.1 million,
respectively.
The 2021 Second Private
Placement Warrants issued in the 2021 Second Registered Direct Equity Offering had a term of five years and were exercisable immediately
and throughout their term for $1.90 per common share (American style option). The exercise price of the 2021 Second Private Placement
Warrants was subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
As of February 10,
2021, all the 2021 Second Private Placement Warrants had been exercised, and, pursuant to their exercise and the issuance by the Company of 13,700,000
common shares, the Company received gross and net proceeds of $26.0 million.
On initial recognition
the fair value of the 2021 Second Private Placement Warrants was $37.3 million and was determined using the Black-Scholes methodology.
The fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 Second Private Placement
Warrants was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 Second Private Placement Warrants
valuation was 152.1%. A 5%
increase in the volatility applied would have led to an increase of 1.3% in the fair value of the 2021 Second Private Placement
Warrants.
F-16
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
7.
Equity Capital Structure (continued):
2021 Third Registered
Direct Equity Offering
On April 5, 2021, the
Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 19,230,770
common shares and warrants to purchase up to 19,230,770 common shares (the “2021 Third Private Placement Warrants”) in a registered
direct offering or the 2021 Third Registered Direct Equity Offering. In connection with the 2021 Third Registered Direct Equity Offering, which closed on April 7, 2021, the Company received gross and net cash proceeds of approximately $125.0 million and $116.3 million,
respectively.
The 2021 Third Private
Placement Warrants issued in the 2021 Third Registered Direct Equity Offering have a term of five years and are exercisable immediately
and throughout their term for $6.50 per common share (American style option). The exercise price of the 2021 Third Private Placement
Warrants is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
Between their issuance
date and June 30, 2021, there were no exercises of the Third Private Placement Warrants and, as a result, as of June 30, 2021, 19,230,770 Third Private Placement Warrants remained unexercised and potentially issuable into common stock of the Company.
On initial recognition
the fair value of the 2021 Third Private Placement Warrants was $106.6 million and was determined using the Black-Scholes methodology.
The fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 Third Private Placement
Warrants was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 Third Private Placement Warrants
valuation was 201.7%. A 5%
increase in the volatility applied would have led to an increase of 0.7% in the fair value of the 2021 Third Private Placement Warrants.
The Company accounted for the 2021 First, Second and Third Private Placement Warrants as equity in accordance with the accounting
guidance under ASC 815-40. The accounting guidance provides a scope exception from classifying and measuring as a financial liability a contract that would otherwise meet the definition of a derivative if the contract is both (i) indexed to the
entity's own stock and (ii) meets the equity classifications conditions. The Company concluded these warrants were equity-classified since they contained no provisions which would require the Company to account for the warrants as a derivative
liability, and therefore were initially measured at fair value in permanent equity with subsequent changes in fair value not measured.
At-the-market (“ATM”)
common stock offering program
On June 14, 2021, the
Company, entered into an equity distribution agreement, or as commonly referred to, an at-the-market offering, with Maxim Group LLC (“Maxim”), under which the Company may sell an aggregate offering price of up to $300.0 million of its common stock with Maxim acting as a sales agent over a minimum period of 12 months (the “ATM Program”). No warrants, derivatives, or other share classes were associated with this transaction. As of June 30, 2021, the Company had received gross proceeds of $10.1 million under the ATM Program by issuing 3,563,407
common shares, whereas, the net proceeds under the ATM Program, after deducting sales commissions and other transaction fees and expenses, amounted to $9.7
million.
Issuance of common stock
in connection with the Class A Warrants and the July 2020 equity offering warrants
During the six months
ended June 30, 2021, the Company issued 5,546,705 common shares upon the exercise of an equivalent number of Class A Warrants issued in
the June 2020 follow-on offering and 5,707,135 common shares upon the exercise of an equivalent number of warrants issued in the July
2020 follow-on equity offering. As of June 30, 2021, the Company raised $39.4 million in proceeds from the partial exercise of
warrants issued in the respective equity offerings.
F-17
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
7.
Equity Capital Structure (continued):
Reverse Stock Split
On May 28, 2021, the
Company effected a 1-for-10 reverse stock split of its common stock without any change in the number of authorized common shares. All
share and per share amounts, as well as warrant shares eligible for purchase under the Company's effective warrant schemes in the accompanying unaudited interim consolidated financial statements have been retroactively adjusted to reflect the
reverse stock split. As a result of the reverse stock split, the number of outstanding shares as of May 28, 2021, was decreased to 89,955,848
while the par value of the Company's common shares remained unchanged to $0.001 per share.
8.
Financial Instruments and Fair Value
Disclosures:
The principal financial
assets of the Company consist of cash at banks, restricted cash, trade accounts receivable and amounts due from related party. The principal financial liabilities of the Company consist of trade accounts payable, amounts due to related parties and
long-term debt (including related party debt).
The following methods and
assumptions were used to estimate the fair value of each class of financial instruments:
◾
Cash and cash equivalents,
restricted cash, trade accounts receivable, amounts due from related party and trade accounts payable: The carrying values reported in the accompanying unaudited interim consolidated balance sheets for those financial instruments are reasonable estimates of their fair values due to their short-term maturity nature. Cash
and cash equivalents and restricted cash, current are considered Level 1 items as they represent liquid assets with short term maturities. The carrying value approximates the fair market value for interest bearing cash classified as
restricted cash, non-current and is considered Level 1 item of the fair value hierarchy. The carrying value of these instruments is separately reflected in the accompanying unaudited interim consolidated balance sheets.
◾
Long-term debt: The secured credit facilities discussed in Note 6, have a recorded value which is a
reasonable estimate of their fair value due to their variable interest rate and are thus considered Level 2 items in accordance with the fair value hierarchy as LIBOR rates are observable at commonly quoted intervals for the full terms of
the loans. The fair value of the fixed interest bearing $5.0 Million Term Loan Facility, discussed in Note 3, determined through
Level 2 inputs of the fair value hierarchy (quoted prices for identical or similar assets and liabilities in markets that are not active), approximates its recorded value as of June 30, 2021.
Concentration
of credit risk: Financial instruments, which
potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents and trade accounts receivable. The Company places its cash and cash equivalents, consisting mostly of deposits, with high
credit qualified financial institutions. The Company performs periodic evaluations of the relative credit standing of the financial institutions in which it places its deposits. The Company limits its credit risk with accounts receivable by performing ongoing credit evaluations of its customers'
financial condition.
9.
Commitments and contingencies:
Various claims,
lawsuits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims
with suppliers relating to the operations of the Company's vessels. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying
unaudited interim consolidated financial statements.
F-18
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
9.
Commitments and contingencies (continued):
The Company accrues for
the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities, which should
be disclosed, or for which a provision should be established in the accompanying unaudited interim consolidated financial statements. The Company is covered for liabilities associated with the vessels’ actions to the maximum limits as provided by
Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs.
(a)
Commitments under Contracts for BWMS
Installation
On November 15, 2018,
the Company entered into a contract to purchase and install BWMS on its dry bulk carriers, which was further amended on October 20, 2019 and December 8, 2020, to reflect the Company’s vessel acquisitions, as applicable in each period. The Company
completed the BWMS installation on the Magic Sun during the vessel’s scheduled dry-docking which took place in the fourth quarter of 2020 and the BWMS was put into use during the second quarter of 2021. The BWMS system installations on the Magic P
and the Magic Moon were granted extensions from the third quarter of 2020 to the third quarter of 2022. It is estimated that the contractual obligations related to these purchases as well as purchases on the Company’s remaining fleet vessels (where
not already installed), excluding installation costs, will be approximately €0.6 million (or $0.7 million on the basis of a Euro/US Dollar exchange rate of €1.0000/$1.1904
as of June 30, 2021), of which $0.01 million are due in 2021 and $0.69 million are due in 2022. These costs will be capitalized and depreciated over the remainder of the life of each vessel.
(b)
Commitments under long-term lease
contracts
The
following table sets forth the Company’s future minimum contracted lease payments (gross of charterers’ commissions), based on vessels’ commitments to non-cancelable fixed time charter contracts as of June 30, 2021. The
calculation does not include any assumed off-hire days.
Twelve-month period ending June 30,
Amount
2022
$
25,815,300
Total
$
25,815,300
10.
Earnings/ (Loss) Per Share:
The Company calculates earnings/(loss) per share by dividing net
income/(loss) available to common stockholders in each period by the weighted-average number of common shares outstanding during that period, after adjusting for the effect of cumulative dividends on the Series A Preferred Shares, whether or not
earned, and only at periods when dividends on the Series A Preferred Shares are contractually allowed to accumulate. As further disclosed under Note 7 of the audited financial statements included in the 2020 Annual Report, dividends on the
Series A Preferred Shares neither accrue nor accumulate during the period from July 1, 2019 until December 31, 2021 and the Company does not have any dividend priority restrictions to holders of its common shares during this period.
Diluted earnings/(loss) per share, if applicable, reflects the
potential dilution that could occur if potentially dilutive instruments were exercised, resulting in the issuance of additional shares that would then share in the Company’s net income. During the six months ended June 30, 2021, the denominator of
diluted earnings per common share calculation includes the incremental shares assumed issued under the treasury stock method weighted for the period the shares were outstanding with respect to warrants outstanding as of June 30, 2021. During
the six months ended June 30, 2020, securities that could potentially dilute basic loss per share that were excluded from the computation of diluted loss per
share, because to do so would have been antidilutive for the period presented, were the incremental shares in connection with the unexercised, as of June 30, 2020, Class A warrants, calculated in accordance with the treasury stock method.
F-19
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
10.Earnings/ (Loss) Per Share (continued):
The components of the
calculation of basic and diluted earnings/(loss) per common share in each of the periods comprising the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss) are as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Net (loss)/ income and comprehensive (loss)/income
$
(404,468
)
$
7,602,568
Less: Cumulative dividends on Series A Preferred Shares
—
—
Net (loss)/income and comprehensive (loss)/ income available to common shareholders
(404,468
)
7,602,568
Weighted average number of common shares outstanding, basic
802,765
73,384,422
Plus: Dilutive effect of warrants
—
2,818,587
Weighted average number of common shares outstanding, diluted
802,765
76,203,009
(Loss)/Earnings per common share, basic and diluted
$
(0.50
)
$
0.10
11.
Vessel Revenues:
The following table includes the voyage
revenues earned by the Company from time charters, voyage charters and pool agreements for the six month periods ended June 30, 2020 and 2021, as presented in the accompanying unaudited interim condensed consolidated statements of comprehensive
income/(loss):
Six
months ended
June 30,
Six
months ended
June 30,
2020
2021
Time charter revenues
5,310,936
27,635,487
Voyage charter revenues
—
693,471
Pool revenues
—
433,678
Total Vessel revenues
$
5,310,936
$
28,762,636
As of June 30, 2021,
trade accounts receivable, net increased by $1,496,824 and deferred revenue increased by $1,564,978 compared to December 31, 2020. These changes were mainly attributable to the timing of collections and the timing of commencement of revenue recognition, theincrease in charter rates and the increase in vessel revenues resultant to the growth of the Company’s fleet during the six
months ended June 30, 2021. As of June 30, 2021, the Company had no deferred revenue related to undelivered performance obligations under any of its voyages in progress.
Further, as of June 30,
2021, deferred assets related to revenue contracts presented under “Deferred charges, net” amounted to $142,898 compared to $0 as of December 31, 2020 and will be expensed during the third quarter of 2021. This change was mainly attributable to the timing of commencement of
revenue recognition.
F-20
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
12.
Vessel Operating and Voyage Expenses:
The amounts in the accompanying
unaudited interim condensed consolidated statements of comprehensive income/(loss) are analyzed as follows:
The amounts in the accompanying unaudited
interim condensed consolidated statements of comprehensive income/(loss) are analyzed as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Audit fees
$
48,640
$
144,624
Chief Executive and Chief Financial Officer and directors' compensation
16,000
24,000
Other professional fees
172,996
690,731
Administration fees-related party (Note 3(c))
—
600,000
Total
$
237,636
$
1,459,355
The Chief Executive Officer and Chief Financial Officer compensation was terminated on October 1, 2020 and, subsequent to this date, all services rendered
by the Company’s Chief Executive Officer and Chief Financial Officer are included in its Master Agreement with Castor Ships (see Note 3(c)).
F-21
CASTOR MARITIME INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in U.S. Dollars – except for share data unless otherwise stated)
14.
Interest and Finance Costs:
The amounts in the accompanying unaudited
interim consolidated balance sheets are analyzed as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Interest on long-term debt
$
374,556
$
580,018
Interest on long-term debt – related party (Note 3 (b))
151,667
150,833
Interest on convertible debt – non cash
57,773
-
Amortization and write-off of deferred finance charges
541,441
125,234
Amortization and write-off of convertible notes beneficial conversion features
532,437
—
Other finance charges
7,954
42,918
Total
$
1,665,828
$
899,003
15.
Subsequent Events:
(a)Entry into $40.75 Million Debt Financing: On July 23, 2021, the Company, through four of its ship-owning subsidiaries, entered into a $40.75 million senior secured term loan facility with Hamburg Commercial Bank AG (the “$40.75
Million Hamburg Facility”). The $40.75 Million Hamburg Facility was drawn in full on July 27, 2021. The facility has a tenor of five years from the drawdown date, bears interest plus LIBOR per annum, and is secured by first mortgages on the M/V Magic Thunder, M/V Magic Nebula, M/V Magic Eclipse and the M/V Magic Twilight.
EX-99.2
3
brhc10027604_ex99-2.htm
EXHIBIT 99.2
Castor Maritime Inc. Reports $6.5 Million net profit for the Three Months Ended June 30, 2021 and $7.6 Million net profit for the Six Months Ended June 30, 2021
Limassol, Cyprus, August 5, 2021 – Castor Maritime Inc. (NASDAQ: CTRM), (“Castor” or the “Company”), a diversified global shipping company, today announced its results for the three and six months ended June 30, 2021.
Highlights of the Second Quarter Ended June 30, 2021:
◾
Revenues, net: $21.8 million for the three months ended June 30, 2021, as compared to $2.6 million for the three months ended June 30, 2020;
◾
Net income/loss: Net income of $6.5 million for the three months ended June 30, 2021, as compared to net loss of $0.1 million for the three months ended June 30, 2020;
◾
Earnings/Loss per common share(1): $0.07 earnings per share for the three months ended June 30, 2021, as compared to loss per
share of $0.12 for the three months ended June 30, 2020;
◾
EBITDA(2): $10.0 million for the three months ended June 30, 2021, as compared to $1.0 million for the three months ended June
30, 2020;
◾
Cash and restricted cash of $42.7 million as of June 30, 2021, as compared to $9.4 million as of December 31, 2020;
◾
During the second quarter of 2021 and as of the date of this press release, we have taken successful delivery of 12 vessels consisting of 4 Kamsarmax and 2 Panamax dry bulk carriers as well as 1 Aframax, 3
Aframax / LR2 and 2 MR1 tankers. We expect three remaining acquisitions to conclude in the third quarter of this year, subject to customary closing conditions. On a fully delivered basis, Castor will own a diversified fleet of 26 vessels with
an aggregate capacity of 2.2 million dwt, having more than quadrupled its fleet size since December 31, 2020;
◾
On June 14, 2021, we received written notice from the Nasdaq Stock Market (“Nasdaq”) that the Company has regained compliance with the Nasdaq’s minimum bid price requirement for continued listing on the Nasdaq
Capital Market; and
◾
In June 2021, we entered into an at-the-market (“ATM”) sales agreement for the offer and sale from time to time of our common shares, having an aggregate offering amount of up to $300.0 million.
Page 1
Earnings Highlights of the Six Months Ended June 30, 2021:
◾
Revenues, net: $28.8 million for the six months ended June 30, 2021, as compared to $5.3 million for the six months ended June 30, 2020;
◾
Net income/loss: Net income of $7.6 million for the six months ended June 30, 2021, as compared to net loss of $0.4 million for the six months ended June 30, 2020;
◾
Earnings/Loss per common share(1): $0.10 earnings per share for the six months ended June 30, 2021, as compared to loss per
share of $0.50 for the six months ended June 30, 2020; and
◾
EBITDA(2): $12.6 million for the six months ended June 30, 2021, as compared to $1.9 million for the six months ended June 30,
2020.
(1) All share and per share amounts disclosed throughout this press release and in the financial information presented in Appendix B have been retroactively updated to reflect the one-for-ten
(1-for-10) reverse stock split effected on May 28, 2021, unless otherwise indicated.
(2) EBITDA is not a recognized measure under United States generally accepted accounting principles (“U.S. GAAP”). Please refer to Appendix B for the definition and reconciliation of this measure to
the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.
Management Commentary:
Mr. Petros Panagiotidis, Chief Executive Officer of Castor commented:
“The first six months of 2021 was a transformational period for our Company, as we were able to raise $262.5 million of equity and $33.3 million of debt and grow our fleet from 6 vessels at the end of 2020 to 26
vessels on a fully delivered basis.
Strong demand for dry bulk transportation services has resulted in robust freight rates, with the upward momentum expected to be sustained by the tight vessel supply and historically low newbuilding orderbook.
Following our timely acquisitions, Castor is well positioned to take advantage of this strong market with a dry bulk fleet consisting of 18 vessels, on a fully delivered basis. At the same time, most of our newly acquired tanker vessels are in either
term or pool employment ensuring a high utilization for that part of our fleet.”
Earnings Commentary:
Second Quarter ended June 30, 2021 and 2020 Results
Vessel revenues, net of charterers’ commissions, for the three months ended June 30, 2021, increased to $21.8 million from $2.6 million in the same period of 2020. This increase was largely driven by the increase in
our Ownership days (defined below) from 273 in the three months ended June 30, 2020 to 1,477 in the three months ended June 30, 2021, following the acquisition and delivery to our fleet of 20 vessels since June 30, 2020. The increase in vessel
revenues during the three months ended June 30, 2021 as compared with the same period of 2020 was further underpinned by a stronger dry bulk shipping market resulting in higher daily TCE earned on average for our fleet
The increase in operating expenses by $6.8 million, from $1.2 million in the second quarter of 2020 to $8.0 million in the second quarter of 2021, as well as the increase in vessels’ depreciation costs by $2.5 million,
from $0.3 million in the second quarter of 2020 to $2.8 million in the second quarter of 2021, mainly reflect the increase in our Ownership days following the expansion of our fleet.
Page 2
Management fees in the second quarter of 2021 amounted to $1.8 million, whereas, in the same period of 2020 management fees totalled $0.1 million. This increase in management fees is primarily due to the sizeable
increase of our fleet, resulting in a substantial increase in our Ownership days for which our managers charge us with a daily management fee, following the acquisitions discussed above. Effective September 1, 2020, the daily management fee for the
technical management of our fleet by Pavimar S.A. was increased from $500 to $600 per vessel, and the daily management fee for the commercial and administrative management of our fleet by Castor Ships S.A. was set to $250 per vessel.
General and administrative expenses in the second quarter of 2021 amounted to $0.7 million, whereas, in the same period of 2020 general and administrative expenses totalled $0.1 million. This increase stemmed from
incurred legal and other corporate fees primarily related to the growth of our company and the $0.3 million quarterly flat fee we pay Castor Ships S.A. with effect from September 1, 2020.
During the second quarter of 2021, we incurred net interest costs and finance costs amounting to $0.5 million compared to $0.8 million during the same period in 2020.
Recent Business and Financial Developments Commentary:
Nasdaq Listing Standards Compliance Update
On June 14, 2021, Nasdaq notified us that as a result of the closing bid price of the Company’s common stock having been at $1.00 per share or greater for at least ten consecutive business days, from May 28, 2021 to June 11, 2021, the Company has regained compliance with Nasdaq’s minimum bid price requirement for continued listing on the Nasdaq Capital
Market, and the matter is now closed.
ATM common stock offering program
On June 14, 2021, we entered into an equity distribution agreement with Maxim Group LLC acting as a sales agent, under which we may, from time to time, offer and sell shares of our common stock
through the ATM program having an aggregate offering price of up to $300.0 million (the “ATM Program”). As of June 30, 2021, we had raised net proceeds of $9.7 million by issuing and selling 3,563,407 common shares under the ATM Program. Between June
30, 2021 and August 4, 2021, no sales of common shares have taken place. We intend to use the net proceeds from the sale of our common stock under the ATM Program, for capital expenditures, working capital, funding for vessel and other asset or share
acquisitions or for other general corporate purposes or a combination thereof.
Financing Transactions Update
On July 23, 2021, we, through four of our ship-owning subsidiaries, entered into a $40.75 million senior secured term loan facility with a European bank which is secured by the M/V Magic Thunder, M/V Magic Nebula, M/V Magic Eclipse and the M/V Magic Twilight. The $40.75 million term loan facility has a tenor of five years and bears interest at a
margin plus LIBOR. The loan was drawn down in full on July 27, 2021.
Vessel Acquisitions Update
During the second quarter of 2021 and as of the date of this earnings press release, we have taken delivery of 12 vessels, aggregating to 17 completed vessel acquisitions of the total 20 vessel acquisitions we made
since the beginning of this year.
Details and delivery information of our completed as well as in progress vessel acquisitions within the second quarter of 2021 and as of the date of this press release are as follows:
Page 3
Completed acquisitions:
Vessel Name
Vessel Type
DWT
Year Built
Country of
Construction
Purchase Price
(in million)
Delivery
Date in
2021
Dry Bulk Carriers
Magic Twilight
Kamsarmax
80,283
2010
Korea
$14.80
9 April
Magic Thunder
Kamsarmax
83,375
2011
Japan
$16.85
13 April
Magic Vela
Panamax
75,003
2011
China
$14.50
12 May
Magic Nebula
Kamsarmax
80,281
2010
Korea
$15.45
20 May
Magic Starlight
Kamsarmax
81,048
2015
China
$23.50
23 May
Magic Eclipse
Panamax
74,940
2011
Japan
$18.48
7 June
Tankers
Wonder Vega
Aframax
106,062
2005
Korea
$14.80
21 May
Wonder Avior
Aframax/LR2
106,162
2004
Korea
$12.00
27 May
Wonder Mimosa
MR1
37,620
2006
Korea
$7.25
31 May
Wonder Arcturus
Aframax/LR2
106,149
2002
Korea
$10.00
31 May
Wonder Musica
Aframax/LR2
106,209
2004
Korea
$12.00
15 June
Wonder Formosa
MR1
37,562
2006
Korea
$8.00
22 June
Vessels we have agreed to acquire:
Vessel Type
DWT
Year
Built
Country of
Construction
Purchase Price
(in million)
Dry Bulk Carriers
Kamsarmax
82,158
2013
Japan
$21.00
Panamax
74,940
2013
Japan
$19.06
Panamax
76,822
2014
Korea
$21.00
Update on common shares issued and outstanding
As of August 4, 2021, we had issued and outstanding 93,519,255 common shares.
Liquidity / Financing / Cash Flow Commentary:
Our consolidated cash position as of June 30, 2021 increased by $33.3 million, to $42.7 million, in relation to our cash position on December 31, 2020. That was mainly the result of: (i) $7.2 million of positive
operating cash flows during the six months ended June 30, 2021, (ii) $157.0 million of net cash proceeds pursuant to the three registered direct offerings of an aggregate 42,405,770 common shares and the concurrent private placement of an equivalent
aggregate number of warrants on January 5, January 12 and April 7, 2021, (iii) proceeds of approximately $83.4 million resulting from subsequent exercises of approximately 34.4 million warrants pursuant to the June 2020, July 2020 and the January
2021 equity offerings, that resulted in the issuance of an equal number of common shares, (iv) net cash inflows of approximately $32.5 million following our entry into two secured loan facilities with two reputable European banks in January and April
of 2021, (v) $9.8 million of net cash proceeds pursuant to common stock sales under the ATM Program, as offset by (vi) $1.6 of scheduled principal repayments on our existing debt agreements.
Page 4
During the six months ended June 30 2021, we used $255.1 million of the net proceeds from our first half of 2021 equity and debt financings to fund our growth and other capital expenditures.
Between July 1, 2021 and August 4, 2021, there have been no subsequent warrant exercises under our currently effective warrant schemes.
As of June 30, 2021, our total debt (including $5.0 million of related party debt maturing in September 2021), gross of unamortized deferred loan fees, was $50.2 million of which $12.5 million was repayable within one
year, as compared to $18.5 million of debt as of December 31, 2020.
Fleet Employment Update (as of August 4, 2021)
During the second quarter of 2021, we operated on average 16.2 vessels earning a daily average TCE rate of $14,381 as compared to an average 3 vessels earning a daily average TCE rate of $9,090 during the same period
in 2020. Our current employment profile is presented below.
Vessel Name
Type/
Country of Construction
DWT
Year
Built
Type of Employment
Daily Gross
Charter Rate
Estimated Redelivery Date (Earliest/ Latest)
Magic P
Panamax dry bulk carrier / Japan
76,453
2004
Time charter
period
$12,750
August 2021
November 2021
Magic Sun
Panamax dry bulk carrier / Korea
75,311
2001
Time charter
period
$10,200
August 2021
October 2021
Magic Moon
Panamax dry bulk carrier / Japan
76,602
2005
Time charter
period
$10,500
July 2021
September 2021
Magic Rainbow
Panamax dry bulk carrier / China
73,593
2007
Time charter
period
$25,000
January 2022
March 2022
Magic Horizon
Panamax dry bulk carrier / Japan
76,619
2010
Time charter
period
$11,000
August 2021
December 2021
Magic Nova
Panamax dry bulk carrier / Japan
78,833
2010
Time charter
period
$10,400
April 2021
August 2021
Magic Venus
Kamsarmax dry bulk carrier / Japan
83,416
2010
Time charter
period
$18,500
August 2021
October 2021
Magic Orion
Capesize dry bulk carrier / Japan
180,200
2006
Time charter
trip
$39,500
September
2021
September
2021
Magic Argo
Kamsarmax dry bulk carrier / Japan
82,338
2009
Time charter
trip
$33,000
September
2021
September
2021
Magic Twilight
Kamsarmax dry bulk carrier / Korea
80,283
2010
Time charter
period
$21,000
November
2021
January 2022
Magic Thunder
Kamsarmax dry bulk carrier / Japan
83,375
2011
Unfixed
N/A
N/A
N/A
Magic Vela
Panamax dry bulk carrier / China
75,003
2011
Time charter
trip
$25,500
August 2021
August 2021
Magic Nebula
Kamsarmax dry bulk carrier / Korea
80,281
2010
Time charter trip
$25,500 +
$550,000 Ballast
Bonus
August 2021
August 2021
Magic Starlight
Kamsarmax dry bulk carrier / China
81,048
2015
Time charter
period
114% of BPI Index
September
2022
March 2023
Page 5
Magic Eclipse
Panamax dry bulk carrier / Japan
74,940
2011
Time charter
trip
$26,500
September
2021
September 2021
Wonder Polaris
Aframax/LR2 tanker / Korea
115,341
2005
Time charter
period
$15,000 +
profit sharing
February 2022
February 2023
Wonder Sirius
Aframax/LR2 tanker / Korea
115,341
2005
Time charter
period
$15,000 +
profit sharing
February 2022
February 2023
Wonder Vega
Aframax tanker / Korea
106,062
2005
Tanker Pool (1)
N/A
N/A
N/A
Wonder Avior
Aframax/LR2 tanker / Korea
106,162
2004
Voyage
$11,280(2)
28 August
2021 (3)
N/A
Wonder Mimosa
MR1 tanker / Korea
37,620
2006
Tanker Pool (4)
N/A
N/A
N/A
Wonder Arcturus
Aframax/LR2 tanker / Korea
106,149
2002
Voyage
$5,500(2)
7 August
2021 (3)
N/A
Wonder Musica
Aframax/LR2 tanker / Korea
106,209
2004
Voyage
$5,000(2)
9 August
2021 (3)
N/A
Wonder Formosa
MR1 tanker /Korea
37,562
2006
Tanker Pool (4)
N/A
N/A
N/A
(1)
The vessel is currently participating in an unaffiliated tanker pool specializing in the employment of Aframax tanker vessels
(2)
For vessels that are employed on the voyage/spot market, the daily gross charter rate is considered as the TCE on the basis of the expected completion date.
(3)
Estimated completion date of the voyage.
(4)
The vessel is currently participating in an unaffiliated tanker pool specializing in the employment of Handysize tanker vessels.
Financial Results Overview:
Three Months Ended
Six Months Ended
(expressed in U.S. dollars)
June 30, 2021 (unaudited)
June 30, 2020 (unaudited)
June 30, 2021 (unaudited)
June 30, 2020 (unaudited)
Vessel revenues, net
$
21,789,783
$
2,585,659
$
28,762,636
$
5,310,936
Operating income
$
7,038,253
$
659,851
$
8,529,692
1,241,992
Net income/ (loss)
$
6,475,508
$
(144,600
)
$
7,602,568
$
(404,468
)
EBITDA(1)
$
9,987,330
$
1,018,366
$
12,558,054
$
1,923,640
Earnings/(Loss) per common share
$
0.07
$
(0.12
)
$
0.10
$
(0.50
)
(1) EBITDA is not a recognized measure under U.S. GAAP. Please refer to Appendix B of this press release for the definition and reconciliation of this
measure to the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.
Fleet selected financial and operational data:
Set forth below are selected financial and operational data of our fleet for each of the three and six months ended June 30, 2021 and 2020, respectively, that we believe are useful in better
analysing trends in our results of operations:
Page 6
Three Months Ended June 30,
Six Months Ended June 30,
(expressed in U.S. dollars except for operational data)
2021
2020
2021
2020
Ownership days (1) (7)
1,477
273
2,105
546
Available days (2)(7)
1,420
273
2,030
488
Operating days (3) (7)
1,380
273
1,978
488
Daily TCE rate(4)
$
14,381
$
9,090
$
13,705
$
10,351
Fleet Utilization (5)
97
%
100
%
97
%
100
%
Daily vessel operating expenses (6)
$
5,390
$
4,452
$
5,352
$
4,770
(1)
Ownership days are the total number of calendar days in a period during which we owned our vessels.
(2)
Available days are the Ownership days in a period less the aggregate number of days our vessels are off-hire due to scheduled repairs, dry-dockings or special or intermediate surveys.
(3)
Operating days are the Available days in a period after subtracting off-hire and idle days.
(4)
Daily TCE rate is not a recognized measure under U.S. GAAP. Please refer to Appendix B of this press release for the definition and reconciliation of this measure to the most directly comparable financial
measure calculated and presented in accordance with U.S. GAAP.
(5)
Fleet utilization is calculated by dividing the Operating days during a period by the number of Available days during that period.
(6)
Daily vessel operating expenses are calculated by dividing vessel operating expenses for the relevant period by the Ownership days for such period.
(7)
Our definitions of days (i.e. Ownership days, Available days, Operating days) may not be comparable to that reported by other companies.
Page 7
APPENDIX A
CASTOR MARITIME INC.
Unaudited Condensed Consolidated Statements of Comprehensive Income/ (Loss)
(In U.S. dollars except for number of share data)
Three Months Ended June 30,
Six Months Ended June 30,
2021
2020
2021
2020
REVENUES
Vessel revenues, net
$
21,789,783
$
2,585,659
$
28,762,636
$
5,310,936
EXPENSES
Voyage expenses -including commissions to related party
(1,368,565
)
(104,093
)
(941,593
)
(259,600
)
Vessel operating expenses
(7,960,638
)
(1,215,266
)
(11,266,895
)
(2,604,336
)
General and administrative expenses (including related party fees)
(720,124
)
(109,253
)
(1,459,355
)
(237,636
)
Management fees -related parties
(1,750,150
)
(136,500
)
(2,524,500
)
(273,000
)
Depreciation and amortization
(2,952,053
)
(360,696
)
(4,040,601
)
(694,372
)
Operating income
$
7,038,253
$
659,851
$
8,529,692
$
1,241,992
Interest and finance costs, net (including related party interest costs)
(485,646
)
(802,270
)
(840,762
)
(1,633,736
)
Other expenses, net
(2,976
)
(2,181
)
(12,239
)
(12,724
)
US source income taxes
(74,123
)
—
(74,123
)
—
Net income/(loss)
$
6,475,508
$
(144,600
)
$
7,602,568
$
(404,468
)
Earnings/(loss) per common share (basic and diluted)
$
0.07
$
(0.12
)
$
0.10
$
(0.50
)
Weighted average number of common shares outstanding, basic
88,933,581
1,222,427
73,384,422
802,765
Page 8
CASTOR MARITIME INC.
Unaudited Condensed Consolidated Balance Sheets
(Expressed in U.S. Dollars—except for number of share data)
June 30,
2021
December 31,
2020
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
40,032,095
$
8,926,903
Due from related party
1,831,311
1,559,132
Other current assets
8,614,300
3,078,119
Total current assets
50,477,706
13,564,154
NON-CURRENT ASSETS:
Vessels, net
300,516,947
58,045,628
Advances for vessel acquisitions
9,243,007
—
Due from related party
1,104,394
—
Other non-currents assets
5,650,447
2,761,573
Total non-current assets, net
316,514,795
60,807,201
Total assets
366,992,501
74,371,355
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt, net – including related party
12,153,410
7,102,037
Due to related parties
198,845
1,941
Trade payables
2,419,986
2,078,695
Accrued liabilities
3,616,175
1,613,109
Deferred Revenue, net
1,516,027
108,125
Total current liabilities
19,904,443
10,903,907
NON-CURRENT LIABILITIES:
Long-term debt, net
37,120,639
11,083,829
Total non-current liabilities
37,120,639
11,083,829
Total Liabilities
57,025,082
21,987,736
SHAREHOLDERS’ EQUITY
Common shares, $0.001 par value; 1,950,000,000 shares authorized; 93,519,255 and 13,121,238 shares, issued and outstanding as at June 30, 2021 and December 31, 2020, respectively (1)
93,519
13,121
Series A Preferred Shares- 480,000 shares issued and outstanding as at June 30, 2021 and December 31, 2020
480
480
Series B Preferred Shares- 12,000 shares issued and outstanding as at June 30, 2021 and December 31, 2020
12
12
Additional paid-in capital
303,587,575
53,686,741
Retained Earnings/(Accumulated Deficit)
6,285,833
(1,316,735
)
Total shareholders’ equity
309,967,419
52,383,619
Total liabilities and shareholders’ equity
$
366,992,501
$
74,371,355
Page 9
CASTOR MARITIME INC.
Unaudited Consolidated Statements of Cash Flows
(Expressed in U.S. Dollars—except for number of share data)
Six Months Ended June 30,
2021
2020
Cash flows (used in)/provided by Operating Activities:
Net income/(loss)
$
7,602,568
$
(404,468
)
Adjustments to reconcile net income/(loss) to net cash provided by/(used in) Operating activities:
Vessels’ depreciation and amortization of deferred dry-docking costs
4,040,601
694,372
Amortization and write-off of deferred finance charges
125,234
541,441
Amortization of other deferred charges
53,449
112,508
Deferred revenue amortization
(157,076
)
(430,994
)
Interest settled in common stock
—
57,773
Amortization and write-off of convertible notes beneficial conversion feature
—
532,437
Changes in operating assets and liabilities:
Accounts receivable trade
(1,496,824
)
(705,003
)
Inventories
(2,836,214
)
(47,380
)
Due from/to related parties
(1,179,669
)
288,538
Prepaid expenses and other assets
(901,228
)
(260,596
)
Dry-dock costs paid
(1,288,364
)
(509,976
)
Other deferred charges
(196,347
)
—
Accounts payable
515,337
(179,960
)
Accrued liabilities
1,365,569
(17,290
)
Deferred revenue
1,564,978
(62,021
)
Net Cash provided by/(used in) Operating Activities
7,212,014
(390,619
)
Cash flows used in Investing Activities:
Vessel acquisitions and other vessel improvements
(245,945,567
)
(388,635
)
Advances for vessel acquisitions
(9,178,452
)
—
Net cash used in Investing Activities
(255,124,019
)
(388,635
)
Cash flows provided by Financing Activities:
Gross proceeds from issuance of common stock and warrants
262,516,826
20,671,500
Common stock issuance expenses
(12,311,638
)
(1,637,559
)
Proceeds from long-term debt
33,290,000
9,500,000
Repayment of long-term debt
(1,571,000
)
(950,000
)
Payment of deferred financing costs
(756,051
)
(608,985
)
Net cash provided by Financing Activities
281,168,137
26,974,956
Net increase in cash, cash equivalents, and restricted cash
33,256,132
26,195,702
Cash, cash equivalents and restricted cash at the beginning of the period
9,426,903
5,058,939
Cash, cash equivalents and restricted cash at the end of the period
$
42,683,035
$
31,254,641
All numbers of share and earnings per share amounts in these unaudited interim condensed financial statements have been retroactively adjusted to reflect the reverse stock split effected on May 28, 2021.
Page 10
APPENDIX B
Non-GAAP Financial Information
Daily TCE Rate. TCE rate, is a measure of the average daily revenue performance of a vessel. The TCE rate is calculated by dividing total revenues (time charter and/or voyage
charter revenues, net of charterers’ commissions), less voyage expenses, by the number of Available days during that period. Under a time charter, the charterer pays substantially all the vessel voyage related expenses. However, we may incur voyage
related expenses when positioning or repositioning vessels before or after the period of a time charter, during periods of commercial waiting time or while off-hire during dry docking or due to other unforeseen circumstances. The TCE rate is not a
measure of financial performance under U.S. GAAP (non-GAAP measure), and should not be considered as an alternative to Time charter revenues, net, the most directly comparable GAAP measure, or any other measure of financial performance presented in
accordance with U.S. GAAP. However, TCE rate is a standard shipping industry performance measure used primarily to compare period-to-period changes in a company’s performance and, management believes that the TCE rate provides meaningful information
to our investors since it compares daily net earnings generated by our vessels irrespective of the mix of charter types (i.e., time charter trips, time charter periods and voyage charters) under which our vessels are employed between the periods
while it further assists our management in making decisions regarding the deployment and use of our vessels and in evaluating our financial performance. Our calculation of TCE rates may not be comparable to that reported by other companies. The
following table reflects the calculation of our TCE rates for the periods presented (amounts in U.S. dollars, except for Available days):
Three Months Ended
June 30,
Six Months Ended
June 30,
(In U.S. dollars, except for Available Days)
2021
2020
2021
2020
Vessel revenues, net
$
21,789,783
$
2,585,659
$
28,762,636
$
5,310,936
Voyage expenses -including commissions from related party
(1,368,565
)
(104,093
)
(941,593
)
(259,600
)
TCE revenues
$
20,421,218
$
2,481,566
$
27,821,043
$
5,051,336
Available Days
1,420
273
2,030
488
TCE rate
$
14,381
$
9,090
$
13,705
$
10,351
EBITDA. We define EBITDA as earnings before interest and finance costs (if any), net of interest income, taxes (when incurred), depreciation and amortization of deferred
dry-docking costs. EBITDA is used as a supplemental financial measure by management and external users of financial statements to assess our operating performance. We believe that EBITDA assists our management by providing useful information that
increases the comparability of our performance operating from period to period and against the operating performance of other companies in our industry that provide EBITDA information. This increased comparability is achieved by excluding the
potentially disparate effects between periods or companies of interest, other financial items, depreciation and amortization and taxes, which items are affected by various and possibly changing financing methods, capital structure and historical cost
basis and which items may significantly affect net income between periods. We believe that including EBITDA as a measure of operating performance benefits investors in (a) selecting between investing in us and other investment alternatives and (b)
monitoring our ongoing financial and operational strength. EBITDA is not a measure of financial performance under U.S. GAAP, does not represent and should not be considered as an alternative to net income, operating income, cash flow from operating
activities or any other measure of financial performance presented in accordance with U.S. GAAP. EBITDA as presented below may not be comparable to similarly titled measures of other companies. The following table reconciles EBITDA to net
(loss)/income, the most directly comparable U.S. GAAP financial measure, for the periods presented:
Page 11
Reconciliation of Net Income/(Loss) to EBITDA
Three Months Ended June 30,
Six Months Ended June 30,
(In U.S. dollars)
2021
2020
2021
2020
Net Income/(Loss)
$
6,475,508
$
(144,600
)
$
7,602,568
$
(404,468
)
Depreciation and amortization
2,952,053
360,696
4,040,601
694,372
Interest and finance costs, net (including amortization of deferred financing costs and beneficial conversion feature, as applicable)
Matters discussed in this press release may constitute 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. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements,
which are other than statements of historical facts. We desire to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are including this cautionary statement in connection with this safe harbor
legislation. The words “believe”, “anticipate”, “intend”, “estimate”, “forecast”, “project”, “plan”, “potential”, “will”, “may”, “should”, “expect”, “pending” and similar expressions identify forward-looking statements. The forward-looking statements
in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management’s examination of historical operating trends, data contained in our records and other
data available from third parties. Although we believe 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 our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or
otherwise. In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward‐looking statements include general dry bulk and tanker shipping market
conditions, including fluctuations in charterhire rates and vessel values, the strength of world economies the stability of Europe and the Euro, fluctuations in interest rates and foreign exchange rates, changes in demand in the dry bulk and tanker
shipping industries, including the market for our vessels, changes in our operating expenses, including bunker prices, dry docking and insurance costs, changes in governmental rules and regulations or actions taken by regulatory authorities,
potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, the length and severity of the COVID-19 outbreak, the impact
of public health threats and outbreaks of other highly communicable diseases, the impact of the expected discontinuance of LIBOR after 2021 on interest rates of our debt that reference LIBOR, the availability of financing and refinancing and grow our
business, vessel breakdowns and instances of off‐hire, potential exposure or loss from investment in derivative instruments, potential conflicts of interest involving our Chief Executive Officer, his family and other members of our senior management,
and our ability to complete acquisition transactions as planned. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties. The information set forth herein speaks
only as of the date hereof, and we disclaim any intention or obligation to update any forward‐looking statements as a result of developments occurring after the date of this communication.
CONTACT DETAILS
For further information please contact:
Petros Panagiotidis
Chief Executive Officer & Chief Financial Officer
Castor Maritime Inc.
Email: ir@castormaritime.com
Media Contact:
Kevin Karlis
Capital Link
Email: castormaritime@capitallink.com
Page 13
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deferred finance costsLong-term DebtLong-Term DebtLong-term Debt [Text Block]Annual Principal Payments [Abstract]2022Long-Term Debt, Maturity, Year OneDebt Financings [Abstract]Presented [Abstract]Long-term Debt, by Current and Noncurrent [Abstract]2025Long-Term Debt, Maturity, Year Four2023Long-Term Debt, Maturity, Year Two2024Long-Term Debt, Maturity, Year ThreeMeasurement Input Type [Axis]Measurement Input Type [Domain]Historical Volatility Measurement Input [Member]Accumulated Depreciation [Abstract]Movement in Accumulated Depreciation, Depletion and Amortization, Property, Plant and Equipment [Roll Forward]Vessel Cost [Abstract]Movement in Property, Plant and Equipment [Roll Forward]Net cash provided by Financing ActivitiesNet Cash Provided by (Used in) Financing ActivitiesCash flows provided by Financing Activities:Net Cash (used in)/provided by Operating ActivitiesNet Cash Provided by (Used in) Operating ActivitiesCash flow used in Investing Activities:Cash Flows (used in)/provided by Operating Activities:Net Cash Provided by (Used in) Operating Activities [Abstract]Net cash used in Investing ActivitiesNet Cash Provided by (Used in) Investing ActivitiesNet (loss)/ incomeNet (loss)/ incomeNet (loss)/income and comprehensive (loss)/ income available to common shareholdersNet Income (Loss) Available to Common Stockholders, BasicRecent Accounting PronouncementsTotal other expenses, netNonoperating Income (Expense)Current portion of long-term debt, related partyLong-term debt from related party, currentNotes Payable, Related Parties, CurrentRelated party debtNotes Payable, Related PartiesNumber of reporting segmentsNumber of Reportable SegmentsChief Executive and Chief Financial Officer and directors' compensationVessel revenues (net of commissions to charterers of $282,059 and $1,001,426, respectively)Vessel revenuesOperating Lease, Lease IncomeVessel Operating Expenses [Abstract]Vessel operating expensesTotal Vessel operating expensesOperating Costs and ExpensesOperating incomeOperating Income (Loss)Basis of Presentation and General informationOrganization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]Basis of Presentation and General information [Abstract]Commitments Under Contracts for BWMS Installation [Abstract]Other Commitments [Abstract]Interest and Finance CostsOther Nonoperating Income and Expense [Text Block]Deferred charges, netOther Assets Disclosure [Text Block]Amortization of other deferred chargesAmortization of Other Deferred ChargesOTHER INCOME/(EXPENSES):OtherOther Cost and Expense, OperatingInterest settled in common stockInterest on convertible debt - non cashPaid-in-Kind InterestPayment of deferred financing costsPayments of Financing CostsCommon stock issuance expensesPayments of Stock Issuance CostsVessel acquisitions and other vessel improvementsConsideration paid for other vessel improvementsPayments to Acquire Property, Plant, and EquipmentPreferred shares, dividend ratePreferred Stock, Dividend Rate, PercentagePreferred Shares [Member]Preferred Stock [Member]Less: Cumulative dividends on Series A Preferred SharesPreferred Stock Dividends, Income Statement ImpactPreferred sharesPreferred Stock, Value, IssuedPreferred shares, shares authorized (in shares)Preferred Stock, Shares AuthorizedPreferred shares, par value (in dollars per share)Preferred Stock, Par or Stated Value Per SharePreferred shares, shares outstanding (in shares)Preferred shares, issued (in shares)Preferred Stock, Shares IssuedPrepaid expenses and other assetsPrepaid expenses and other assets, non-currentProceeds from long-term debtGross proceeds from issuance of common stock and warrantsGross proceeds from issuance of common stock and warrantsGross proceeds from issuance of common sharesProperty, Plant and Equipment [Line Items]Vessels, net/ Advances for vessel acquisitionsProperty, Plant and Equipment Disclosure [Text Block]Acquisitions, improvements and other vessel costsVessels, net/ Advances for vessel acquisitions [Abstract]Vessels, NetProperty, Plant and Equipment [Table Text Block]Long-Lived Tangible Asset [Axis]Long-Lived Tangible Asset [Domain]Vessels, netAggregate carrying valueBeginning balanceEnding balanceTransfers from Advances for vessel acquisitionsProperty, Plant and Equipment, Transfers and ChangesEnding balanceBeginning balanceProperty, Plant and Equipment, GrossProperty, Plant and Equipment, Net [Abstract]Net Book Value [Abstract]Property, Plant and Equipment, Net, by Type [Abstract]Purchase Commitment, Excluding Long-term Commitment [Line Items]Contractual purchase obligationsPurchase Commitment, Remaining Minimum Amount CommittedPurchase Commitment, Excluding Long-term Commitment [Domain]Purchase Commitment, Excluding Long-term Commitment [Table]Purchase Commitment for Ballast Water Management Systems [Member]Purchase Commitment [Member]Purchase Commitment, Excluding Long-term Commitment [Axis]Transactions with Related Parties [Abstract]Related Party Transaction [Line Items]Management Agreements [Abstract]Transactions with Related Parties [Abstract]Related Party Transaction, Due from (to) Related Party, Current [Abstract]Balances with Related Parties [Abstract]Related Party Transaction, Due from (to) Related Party [Abstract]Related Party Transaction [Axis]Related Party [Axis]Administration feesAdministration fees-related party (Note 3(c))General and administration expenses, related partiesTransactions with Related PartiesRelated Party Transactions Disclosure [Text Block]Related Party Transaction [Domain]Related Party [Domain]Repayment of long-term debtRepayments of Secured DebtRepayment of loanRestricted cashRestricted Cash, NoncurrentRestricted cashRestricted CashRestricted CashRestricted Cash, CurrentRetained Earnings/ (Accumulated Deficit) [Member]Retained Earnings [Member](Accumulated deficit)/ Retained earningsRetained Earnings (Accumulated Deficit)Vessel Revenues [Abstract]Vessel RevenuesREVENUES:Revenues [Abstract]Total revenuesRevenuesNet proceeds from issuance of common stock and warrantsSale of Stock [Domain]Annual Principal PaymentsSchedule of Maturities of Long-term Debt [Table Text Block]Interest and Finance CostsSchedule of Other Nonoperating Income (Expense) [Table Text Block]Transactions with Related PartiesSchedule of Related Party Transactions [Table Text Block]Calculation of Basic and Diluted Earnings/ (Loss) per ShareSchedule of Earnings Per Share, Basic and Diluted [Table Text Block]Long-Term Debt Including Related Party DebtSchedule of Debt [Table Text Block]Schedule of Related Party Transactions, by Related Party [Table]Property, Plant and Equipment [Table]Schedule of Stock by Class [Table]Current portion of long-term debt, netCurrent portion of long-term debt, net of deferred finance costsSecured Debt, CurrentLong-term debt, netNon-Current portion of long-term debt, net of deferred finance costsSegment Reporting [Abstract]Segment ReportingSegment Reporting, Policy [Policy Text Block]Preferred A Shares [Member]Series A Preferred Shares [Member]Preferred B Shares [Member]Series B Preferred Shares [Member]Balance (in shares)Balance (in shares)Shares, OutstandingSignificant Accounting Policies and Recent Accounting PronouncementsSignificant Accounting Policies [Text Block]UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS [Abstract]Class of Stock [Axis]Statement [Table]Statement [Line Items]UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS [Abstract]Equity Components [Axis]UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY [Abstract]Issuance of common stock pursuant to the $5.0 Million Convertible Debentures (Notes 6, 7) (in shares)Stock Issued During Period, Shares, Conversion of Convertible SecuritiesIssuance of common stock (in shares)Issuance of common stock pursuant to the $5.0 Million Convertible Debentures (Notes 6, 7)Stock Issued During Period, Value, Conversion of Convertible SecuritiesReverse stock splitBalanceBalanceTotal shareholders' equityStockholders' Equity Attributable to ParentEquity Capital StructureSHAREHOLDERS' EQUITY:Stockholders' Equity Attributable to Parent [Abstract]Equity Capital Structure [Abstract]Stockholders' Equity Note [Abstract]Subsequent Event [Member]Subsequent Event Type [Domain]Subsequent Event [Line Items]Subsequent Event Type [Axis]Subsequent Events [Abstract]Subsequent Event [Table]Subsequent EventsSale of Stock [Axis]SUPPLEMENTAL CASH FLOW INFORMATIONSupplemental Cash Flow Information [Abstract]Tonnage taxesTaxes, MiscellaneousFair value of warrantsTerm of warrantWarrants and Rights Outstanding, TermMeasurement input - VolatilityWarrants and Rights Outstanding, Measurement InputWeighted average number of common shares, diluted (in shares)Weighted average number of common shares outstanding, diluted (in shares)Plus: Dilutive effect of warrants (in shares)Weighted Average Number Diluted Shares Outstanding AdjustmentWeighted average number of common shares, basic (in shares)Weighted average number of common shares outstanding, basic (in shares)Consolidated Entities [Domain]Consolidated Entities [Axis]Maximum [Member]Minimum [Member]Product and Service [Domain]Product and Service [Axis]Statistical Measurement [Domain]Statistical Measurement [Axis]Cover [Abstract]Document TypeAmendment FlagDocument Period End DateLegal Entity [Axis]Entity [Domain]Entity Registrant NameEntity Central Index KeyCountry of incorporationEntity Incorporation, State or Country CodeCurrent Fiscal Year End DateWatercraft used as a means of transportation on water.Vessels [Member]Vessels [Member]The number of vessels acquired by the entity during the period.Number of vessels acquiredNumber of vessels acquiredAn en bloc acquisition of a tanker fleet comprising of two 2006 Korean-built MR1 tankers, two 2004 Korean-built Aframax/LR2 tankers and one 2002 Korean-built Aframax/LR2 tankerEn Bloc Acquisition [Member]An Aframax, long range (LR2) tanker built in Korea in 2005 with a deadweight between 55,000-79,999 metric tonnes.Aframax LR2 Tanker, Built in 2005 [Member]2005 Korean-built Aframax LR2 Tanker [Member]An Aframax, long range (LR2) tanker built in Korea in 2004 with a deadweight between 55,000-79,999 metric tonnes.Aframax LR2 Tanker, Built in 2004 [Member]2004 Korean-built Aframax/LR2 Tanker [Member]A medium range (MR1) tanker built in Korea in 2006 with a capacity between 35,000-44,999 deadweight tonnage (DWT).MR1 Tanker, Built in 2006 [Member]2006 Korean-built MR1 Tanker [Member]An Aframax, long range (LR2) tanker built in Korea in 2002 with a deadweight between 55,000-79,999 metric tonnes.Aframax LR2 Tanker, Built in 2002 [Member]2002 Korean-built Aframax/LR2 Tanker [Member]The number of vessels first priority mortgaged as collateral to their loan facilities.Number of vessels mortgaged as collateralNumber of vessels first priority mortgaged as collateral to loan facilities12 dry bulk carriers and 8 tanker vessels acquired in 2021.Vessel Acquisitions 2021 [Member]2021 Vessel Acquisitions [Member]Vessels that were first priority mortgaged as collateral to their loan facilities.Vessels Mortgaged as Collateral [Member]Vessels Mortgaged as Collateral [Member]The Wonder Polaris is a Korean-built Aframax LR2 tankers vessel with a carrying capacity of 115,341 dwt and the Wonder Sirius is a Korean-built Aframax LR2 tankers vessel with a carrying capacity of 115,341 dwt.Wonder Polaris and Wonder Sirius [Member]The number of vessels to be acquired by the entity.Number of vessels to be acquiredNumber of vessels to be acquiredConsideration paid for already installed ballast water management system ("BWMS") on the Magic Vela upon completion of its acquisition.BWMS on Magic Vela [Member]Tabular disclosure of general and administrative expenses related to company administration.General and Administrative Expenses [Table Text Block]Company Administration ExpensesAmount of fees paid to an independent registered public accounting firm for professional services rendered for the audit of the consolidated financial statements and any other audit services required for the SEC or other regulatory filings.Audit feesAudit feesAmount of fees paid for services from other professionals, such as lawyers and accountants.Professional Fees, OtherOther professional feesThe entire disclosure for general and administrative expenses.General and Administrative Expenses [Text Block]General and Administrative ExpensesTabular disclosure of changes in advances for acquisition of vessels.Schedule of Advances for Vessels Acquisitions [Table Text Block]Advances for Vessels acquisitionsThe period of time that the Company can sell shares from under an at-the-market (ATM) continuous equity offering program in PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents the reported fact of one year, five months, and thirteen days.Common Stock that Can be Sold, TermTerm common stock can be sold under ATMThe value of common stock that can be issued and sold from time to time under an at-the-market (ATM) continuous equity offering program.Common Stock that Can be Sold, ValueCommon stock that can be sold under ATMClass A security that gives the holder the right to purchase one share of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount.Class A Warrant [Member]Class A Warrants [Member]On July 12, 2020, the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered 57,750,000 common shares in a registered offering (the "July Equity Offering").July 2020 Equity Offering [Member]July 2020 Equity Offering [Member]On June 23, 2020, the Company entered into an agreement with Maxim Group LLC, or Maxim, acting as underwriter pursuant to which it offered and sold 59,110,000 units, each unit consisting of (i) one common share or a pre-funded warrant to purchase one common share at an exercise price equal to $0.01 per common share (a "Pre-Funded Warrant"), and (ii) one Class A Warrant to purchase one common share (a "Class A Warrant"), for $0.35 per unit (or $0.34 per unit including a pre-funded warrant), or the June Equity Offering.June 2020 Equity Offering [Member]June 2020 quity Offering [Member]Reverse Stock Split [Abstract]Reverse Stock Split [Abstract]The 2021 First Private Placement Warrants issued in the 2021 First Registered Direct Equity Offering and he Company that gives the holder the right to purchase one share of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount.First Private Placement Warrants 2021 [Member]2021 First Private Placement Warrants [Member]On December 30, 2020, the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 9,475,000 common shares and warrants to purchase up to 9,475,000 common shares (the "2021 First Private Placement Warrants") in a registered direct offering or the 2021 First Registered Direct Equity Offering. In connection with the 2021 First Registered Direct Equity Offering.First Registered Direct Equity Offering 2021 [Member]2021 First Registered Direct Equity Offering [Member]Number of warrants or rights exercised during the period.Class of Warrant or Right, ExercisedWarrants exercised (in shares)On April 5, 2021, the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 19,230,770 common shares and warrants to purchase up to 19,230,770 common shares (the "2021 Third Private Placement Warrants") in a registered direct offering or the 2021 Third Registered Direct Equity Offering.Third Registered Direct Equity Offering 2021 [Member]2021 Third Registered Direct Equity Offering [Member]The 2021 Third Private Placement Warrants issued in the 2021 Third Registered Direct Equity Offering and he Company that gives the holder the right to purchase one share of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount.Third Private Placement Warrants 2021 [Member]2021 Third Private Placement Warrants [Member]The maximum number of capital shares, including preferred and common stock, permitted to be issued by an entity's charter and bylaws.Capital Stock, Shares AuthorizedCapital shares, shares authorized (in shares)Face amount or stated value per share of capital shares, including preferred and common stock.Capital Stock, Par or Stated Value Per ShareCapital shares, par value (in dollars per share)Senior secured term loan facility entered into with Chailease International Financial Services Co., Ltd. on January 23, 2020.Senior Secured Term Loan Facility [Member]$4.5 Million Term Loan Facility [Member]Amount, before unamortized (discount) premium and debt issuance costs, of long-term debt classified as noncurrent.Long-term Debt, Gross, NoncurrentNon-Current portion of long-term debtAmount, before unamortized (discount) premium and debt issuance costs, of long-term debt classified as current.Long-term Debt, Gross, CurrentCurrent portion of long-term debtOn January 8, 2021, the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 13,700,000 common shares and warrants to purchase up to 13,700,000 common shares (the "2021 Second Private Placement Warrants") in a registered direct offering or the 2021 Second Registered Direct Equity Offering.Second Registered Direct Equity Offering 2021 [Member]2021 Second Registered Direct Equity Offering [Member]Percentage increase (decrease) in the volatility percentage applied to the valuation of warrants.Percentage Increase (Decrease) in VolatilityPercentage increase in volatility causing increase in fair value of warrantsPercentage increase (decrease) in the fair value of warrants due to an increase (decrease) in the volatility applied to the valuation of warrants.Percentage Increase (Decrease) in Fair Value of WarrantsPercentage increase in fair value of warrants due to increase in volatilityThe 2021 Second Private Placement Warrants issued in the 2021 Second Registered Direct Equity Offering and he Company that gives the holder the right to purchase one share of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount.Second Private Placement Warrants 2021 [Member]2021 Second Private Placement Warrants [Member]Amount of advances for vessel acquisitions and other vessel pre-delivery costs transfer to Vessels net during the period.Advances Transfer to Vessels, NetTransfer to Vessels, netAmount of advances for vessel acquisitions and other vessel pre-delivery costsAdvances for vessel acquisitions and other vessel pre-delivery costsCommissions paid to related party for time-charter and voyage-charter arrangements.Brokerage Commissions, Related PartyBrokerage commissions- related partyCommissions paid to brokers for time-charter and voyage-charter arrangements.Brokerage commissionsBrokerage commissionsAmount of operating expenses for vessel repair and maintenance, spares, stores, classification, chemicals and gases, paints and victualling.Vessel Repair and Maintenance ExpensesRepairs & maintenance, spares, stores, classification, chemicals & gases, paints, victuallingAmount of operating expense for lubricants.Lubricant ExpensesLubricantsThe amount of loss (gain) on bunker fuel during the period. The gain or loss is the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer.Loss (Gain) on Bunker FuelLoss/(Gain) on bunkersAmount of bunkers (or energy) consumption related to fuel stored on a ship and used as fuel for machinery operation.Bunkers consumptionFixed charges, such as wharfage, towage, and pilotage, levied against a ship or its cargo in port and other expenses.Port and Other ExpensesPort & other expensesVoyage Expense [Abstract]Voyage Expenses [Abstract]The number of vessels in the Company's fleet.Number of vesselsNumber of vesselsPercentage of the Company's shares held by another entity.Percentage of shares heldPercentage of shares heldBasis of Presentation and Organization [Abstract]Basis of Presentation [Abstract]A medium-sized vessel with a carrying capacity between 80,000 and 85,000 deadweight tonnage (DWT).Kamsarmax Vessel [Member]Kamsarmax [Member]A tanker is a ship designed to transport or store liquids or gases in bulk.MR1 [Member]Handysize/MR1 [Member]A dry bulk carrier with a dead-weight carrying capacity of about 75,000 tons.Panamax Vessel [Member]Panamax Dry Bulk [Member]A large-sized dry bulk vessel.Capesize Vessel [Member]Capesize [Member]An oil tanker with a carrying capacity between 80,000 and 120,000 deadweight tonnage (DWT).Aframax [Member]Aframax [Member]An Aframax, long range (LR2) tanker built in Korea with a deadweight between 55,000-79,999 metric tonnes.Aframax LR2 Tanker [Member]Aframax LR2 Tanker [Member]Amount of additions to asset recognized from cost incurred to obtain or fulfill contract with customer.Capitalized Contract Cost, AdditionsAdditionsThe increase (decrease) during the reporting period in the value of other expenditures made during the current reporting period for benefits that will be received over a period of years. Deferred charges differ from prepaid expenses in that they usually extend over a long period of time and may or may not be regularly recurring costs of operation.Increase (Decrease ) in Other Deferred ChargesOther deferred chargesThe amount of cash outflows associated with advance amount for vessel acquisitions.Payments of Advances for Vessel AcquisitionsAdvances for vessel acquisitionsThe amount of unpaid deferred dry-dock costs.Unpaid Deferred Dry-dock CostsUnpaid deferred dry-dock costs (included in Accounts payable and Accrued liabilities)Future cash outflow to pay for costs incurred directly with the issuance of an equity security.Stock Issuance Costs Incurred but Not yet PaidUnpaid capital raising costs (included in Accounts payable and Accrued Liabilities)The amount of unpaid advances for vessel acquisitions.Unpaid Advances For Vessel AcquisitionsUnpaid advances for vessel acquisitions (included in Accounts payable and Accrued Liabilities)The aggregate amount of vessels' depreciation and amortization of deferred dry-docking costs.Depreciation and Amortization of Deferred Dry-Docking CostsVessels' depreciation and amortization of deferred dry-docking costsThe amount of amortization and write-off of beneficial conversion feature resulting from the recognition of convertible debt instruments as two separate components - a debt component and an equity component.Amortization and Write-off of Convertible Notes Beneficial Conversion FeatureAmortization and write-off of convertible notes beneficial conversion featureAmortization and write-off of convertible notes beneficial conversion featuresAmount of amortization expense attributable to debt issuance costs and write-off of amounts previously capitalized as debt issuance cost in an extinguishment of debt.Amortization and Write off of Deferred Debt Issuance CostsAmortization and write-off of deferred finance chargesAmount of revenue recognized that was previously included in balance of obligation to transfer good or service to customer for which consideration from customer has been received or is due.Contract with Customer, Liability, Amortization of Deferred RevenueDeferred revenue amortizationMultiplier applied to the total amount of the daily management fee calculated on an annual basis to determine the termination fee under the shipmanagement agreements.Related Party Transaction, Shipmanagement Termination Fee MultiplierTermination fee multiplierNumber of vessels under technical management with third-party, sub-contracted ship-management companies.Number of vessels under technical management with subcontractorNumber of vessels under technical management with subcontractorThe Company is provided a range of technical, crewing, insurance and operational services for each ship-owning subsidiary in exchange for a fixed daily fee.Technical Shipmanagement Agreements [Member]Technical Management Agreements [Member]Pavimar has subcontracted the technical management of the Magic Nova to a third-party ship-management company, Fleet Ship Management Inc. ("Fleet Ship"). Fleet Ship provides technical management to the Magic Nova for a fixed annual fee which is reimbursed by Pavimar.Subcontracted Technical Management Agreement [Member]Subcontracted Technical Management Agreement to Fleet Ship [Member]Amount of working capital guaranteed deposits paid to the related party.Working Capital Guarantee DepositsWorking capital guarantee depositsWorking capital advances made to Pavimar and its subcontractor third-party managers for operating expenses paid in advance.Working Capital Advances [Member]Working Capital Advances [Member]A ship designed to transport or store liquids or gases in bulk.Tanker [Member]Tanker Vessels [Member]A vessel designed to carry dry cargoes in bulk.Dry Bulk Carrier [Member]Dry Bulk Vessels [Member]Dry Bulk Carriers [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Bagheera Shipping Co. [Member]Bagheera Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Pikachu Shipping Co. [Member]Pikachu Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Snoopy Shipping Co. [Member]Snoopy Shipping Co. [Member]Vessel with a carrying capacity of 73,593 dwt.Magic Rainbow [Member]M/V Magic Rainbow [Member]Vessel with a carrying capacity of 76,619 dwt.Magic Horizon [Member]M/V Magic Horizon [Member]Vessel with a carrying capacity of 81,048 dwt.Magic Starlight [Member]Magic Starlight [Member]M/V Magic Starlight [Member]Vessel with a carrying capacity of 37,562 dwt.Wonder Formosa [Member]M/T Wonder Formosa [Member]Vessel with a carrying capacity of 76,602 dwt.Magic Moon [Member]M/V Magic Moon [Member]Vessel with a carrying capacity of 80,283 dwt.Magic Twilight [Member]M/V Magic Twilight [Member]Magic Twilight [Member]Vessel with a carrying capacity of 75,003 dwt.Magic Vela [Member]M/V Magic Vela [Member]Magic Vela [Member]A secondhand 2006 Japanese-built Capesize dry bulk carrier.Magic Orion [Member]M/V Magic Orion [Member]Magic Orion [Member]Vessel with a carrying capacity of 37,620 dwt.Wonder Mimosa [Member]Wonder Mimosa [Member]M/T Wonder Mimosa [Member]A secondhand 2009 Japanese-built Kamsarmax dry bulk carrier.Magic Argo [Member]M/V Magic Argo [Member]Magic Argo [Member]Vessel with a carrying capacity of 78,833 dwt.Magic Nova [Member]M/V Magic Nova [Member]Vessel with a carrying capacity of 106209 dwt.Wonder Musica [Member]M/T Wonder Musica [Member]Vessel with a carrying capacity of 80,281 dwt.Magic Nebula [Member]M/V Magic Nebula [Member]Magic Nebula [Member]Vessel with a carrying capacity of 83,375 dwt.Magic Thunder [Member]M/V Magic Thunder [Member]Magic Thunder [Member]Vessel with a carrying capacity of 74,940 dwt.Magic Eclipse [Member]M/V Magic Eclipse [Member]Magic Eclipse [Member]Vessel with a carrying capacity of 106,149 dwt.Wonder Arcturus [Member]M/T Wonder Arcturus [Member]Panamax vessel with a carrying capacity of 76,453 dwt.Magic P [Member]M/V Magic P [Member]Vessel with a carrying capacity of 106,062 dwt.Wonder Vega [Member]M/T Wonder Vega [Member]Wonder Vega [Member]Vessel with a carrying capacity of 75,311 dwt.Magic Sun [Member]M/V Magic Sun [Member]Vessel with a carrying capacity of 115,341 dwt.Wonder Sirius [Member]M/T Wonder Sirius [Member]A secondhand 2010 Japanese-built Kamsarmax dry bulk carrier.Magic Venus [Member]M/V Magic Venus [Member]Magic Venus [Member]Vessel with a carrying capacity of 115,341 dwt.Wonder Polaris [Member]M/T Wonder Polaris [Member]Vessel with a carrying capacity of 106,162 dwt.Wonder Avior [Member]M/T Wonder Avior [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Luffy Shipping Co. [Member]Luffy Shipping Co. [Member]Deadweight tonnage (DWT) is a measure of vessels capacity in weight, and does not include the weight of the vessel.Dead Weight TonnageDWTCombined carrying capacityWholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Kabamaru Shipping Co. [Member]Kabamaru Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Mulan Shipping Co. [Member]Mulan Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Pumba Shipping Co. [Member]Pumba Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Liono Shipping Co. [Member]Liono Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Xavier Shipping Co. [Member]Xavier Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Gamora Shipping Co. [Member]Gamora Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Cinderella Shipping Co. [Member]Cinderella Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Colossus Shipping Co. [Member]Colossus Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Elektra Shipping Co. [Member]Elektra Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Bistro Maritime Co. [Member]Bistro Maritime Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Stewie Shipping Co. [Member]Stewie Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Starlord Shipping Co. [Member]Starlord Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Vision Shipping Co. [Member]Vision Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Spetses Shipping Co [Member]Spetses Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Super Mario Shipping Co. [Member]Super Mario Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Hawkeye Shipping Co. [Member]Hawkeye Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Rocket Shipping Co. [Member]Rocket Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Pocahontas Shipping Co. [Member]Pocahontas Shipping Co. [Member]Wholly-owned subsidiary of the Company, incorporated in the Marshall Islands.Jumaru Shipping Co. [Member]Jumaru Shipping Co. [Member]The name of vessel.Vessel NameVessel nameThe year in which the vessel was built.Vessel Year BuiltYear builtDate the vessel was delivered to the entity.Date of DeliveryDelivery date to CastorSubsidiaries in Consolidation [Abstract]Subsidiaries in Consolidation [Abstract]Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.Organization [Line Items]Subsidiaries in Consolidation [Line Items]Disclosure of information on the organization.Organization [Table]Organization [Table]Tabular disclosure of information regarding subsidiaries owning vessels.Vessel Owning Subsidiaries [Table Text Block]Vessel Owning SubsidiariesPavimar S.A. (Pavimar) is a company controlled by Ismini Panagiotidis, the sister of Petros Panagiotidis, the Company's Chairman, Chief Executive Officer and Chief Financial Officer.Pavimar S.A. [Member]Pavimar [Member]An entity registered in the Liberia that is wholly-owned and controlled by Petros Panagiotidis, the Company's Chairman, Chief Executive Officer and Chief Financial Officer.Thalassa Investment Co. S.A. [Member]Thalassa [Member]Under the separate Management Agreement for each ship-owning subsidiary, the Company is provided with a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support, in exchange for a fixed daily fee.Vessel Management Agreements [Member]Vessel Management Agreements [Member]Amount for management fees payable to related parties.Management Fees Due to Related PartyManagement fees dueAn unsecured term loan with Thalassa Investment Co.Term Loan Facility [Member]$5.0 Million Term Loan Facility [Member]Commercial management services provided to the Company.Commercial Management Services [Member]Commercial Management Services [Member]Amount of interest payable on debt due to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).Accrued Interest, Related Parties, CurrentAccrued interest to related partyAccrued loan interestCommissions paid to a related party broker on time-charter and voyage-charter arrangements.Related Party Transaction, CommissionsCharter hire commissionsA company ultimately beneficially owned by the Company's Chairman, Chief Executive Officer and Chief Financial Officer.Castor Ships S.A. [Member]Castor Ships [Member]Primary financial statement caption encompassing voyage expenses.Voyage Expenses [Member]Voyage Expenses [Member]Primary financial statement caption encompassing management fees to related party.Management Fees to Related Party [Member]Management Fees to Related Party [Member]The percentage of the gross charter hire, freight and the ballast bonus earned under a charter charged as a commission to the Company by a related party.Related Party Transaction, Commission RateCommission rate on charter agreementsA commission charged by a related party in connection with each vessel sale and purchase transaction.Related Party Transaction, Commission Rate on Each Vessel Sale and Purchase TransactionCommission rate on each vessel sale and purchase transactionFixed daily fee charged by a related party to provide a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.Related Party Transaction, Fixed Daily FeeDaily fee for servicesFixed quarterly fee charged by a related party to provide a shipping related administrative services.Related Party Transaction, Quarterly Management FeeQuarterly management feeTerm of related party agreement, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.Related Party Transaction, Term of AgreementTerm of agreementAmount of commission charged by related party for any sale or purchase of vessels for the Company.Related Party Transaction, Sale and Purchase CommissionSale and purchase commissionSale & purchase commissionTermination fee multiplier applied to the total amount of the flat management fee and the per vessel management fee calculated on an annual basis under an agreement with a related party.Related Party Transaction, Management Termination Fee MultiplierTermination fee multiplierTerm of related party agreement renewal, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.Related Party Transaction, Renewal Term of AgreementRenewal term of agreementUnder the Commercial Shipmanagement Agreements, Castor Ships manages overall the Company's business and provides commercial, chartering and administrative services, including, but not limited to, securing employment for the Company's fleet, arranging and supervising the vessels' commercial operations, handling all the Company's vessel sale and purchase transactions, undertaking related shipping project and management advisory and support services, as well as other associated services requested from time to time by the Company and its shipowning subsidiaries.Commercial Shipmanagement Agreements [Member]Commercial Shipmanagement Agreements [Member]On September 1, 2020, the Company and its shipowning subsidiaries entered into a master management agreement (the "Master Agreement") with Castor Ships S.A. ("Castor Ships"), a company ultimately beneficially owned by the Company's Chairman, Chief Executive Officer and Chief Financial Officer. Pursuant to the terms of the Master Agreement each of the Company's shipowning subsidiaries also entered into separate commercial shipmanagement agreements with Castor Ships (the "Commercial Shipmanagement Agreements" and together with the Master Agreement, the "Castor Ships Management Agreements"). Under the terms of the Castor Ships Management Agreements, having all September 1, 2020 as their effective date, Castor Ships manages overall the Company's business and provides commercial, chartering and administrative services, including, but not limited to, securing employment for the Company's fleet, arranging and supervising the vessels' commercial operations, handling all the Company's vessel sale and purchase transactions, undertaking related shipping project and management advisory and support services, as well as other associated services requested from time to time by the Company and its shipowning subsidiaries.Management Agreements [Member]Management Agreements [Member]Advance amount related to vessel acquisitions.Advances for vessel acquisitionsOpening BalanceClosing BalanceLong-term debt of the Company including a senior secured term loan with Alpha Bank S.A ($11.0 million Alpha Bank Financing) and an unsecured term loan with Thalassa Investment Co. ($5.0 million Term Loan Facility).Third Party and Related Party Debt [Member]Long-Term Debt (Including Related Party Debt) [Member]The amount of non-legally restricted cash per collateralized vessel required as a minimum liquidity requirement under the debt instrument.Minimum Liquidity DepositMinimum liquidity deposit per vesselThe amount of retention deposits restricted as to usage.Retention DepositsRetention depositsThe carrying amount of the dry-docking reserve account required to be maintained by the borrower under the loan agreement.Dry-docking Reserve AccountsDry-dock reserve accountsThe aggregate amount of non-legally restricted cash required as a minimum liquidity requirement under the debt instruments.Minimum Liquidity DepositsMinimum liquidity depositsTabular disclosure of voyage expenses.Voyage Expenses [Table Text Block]Voyage ExpensesTabular disclosure of vessel operating expenses.Vessel Operating Expenses [Table Text Block]Vessel Operating ExpensesThe entire disclosure for vessel operating expenses and voyage expenses.Vessel Operating and Voyage Expenses [Text Block]Vessel Operating and Voyage ExpensesVessel Operating and Voyage Expenses [Abstract]Senior secured term loan facility entered into with Alpha Bank A.E on November 22, 2019.Senior Secured Team Loan Facility, Alpha Bank [Member]$18.0 Million Term Loan Facility [Member]The number of periodic payment installments in which the debt is to be repaid.Debt Instrument, Number of Payment InstallmentsNumber of payment installmentsSenior secured term loan facility entered into with Hamburg Commercial Bank AG on January 22, 2021.Senior Secured Team Loan Facility, Hamburg Commercial Bank [Member]$15.3 Million Term Loan Facility [Member]Three unsecured convertible debentures issued and sold to an institutional investor under a securities purchase agreement (collectively, the $5.0 Million Convertible Debentures).Convertible Debentures [Member]$5.0 Million Convertible Debentures [Member]A voyage charter is a contract to charter a vessel for a fixed amount per ton of cargo carried.Voyage Charter [Member]Voyage Charter [Member]A time charter is a contract to charter a vessel for a fixed period at a set daily rate.Time Charter [Member]Time Charter [Member]Revenue generated from pool agreements.Pool Agreements [Member]Pool [Member]A senior secured term loan with Alpha Bank S.A ("the Alpha Bank Financing").Alpha Bank Financing [Member]$11.0 Million Term Loan Facility [Member]Number of the Company's ship-owning subsidiaries that entered into a senior secured post-delivery term loan facility.Number of ship-owning subsidiaries entering into term loan facilityNumber of ship-owning subsidiaries entering into term loan facilityA senior secured post-delivery term loan facility with Hamburg Commercial AG.Hamburg Facility [Member]$40.75 Million Hamburg Facility [Member]Costs primarily relating to commissions to related party brokers that are unique to a particular charter.Voyage Expenses, Related PartyVoyage expenses, related partyAddress commissions represent discount (sales incentive) on services rendered by the Company and no identifiable benefit is received in exchange for the consideration provided to the charterer.Address CommissionsCommissions to charterersFees paid to related parties for providing a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.Related Party Transaction, Management FeesManagement fees to related partiesManagement feesManagement fees to related partyVoyage expenses consist of: (a) port, canal and bunker expenses that are unique to a particular charter which are paid for by the charterer under the time charter arrangements or by the Company under voyage charter arrangements, and (b) brokerage commissions, which are always paid for by the Company, regardless of charter type.Voyage ExpensesVoyage expenses (including $0 and $364,540 to related parties for the six months ended June 30, 2020 and 2021, respectively)Total Voyage expensesEquity impact of the value of new stock issued during the period pursuant to registered direct offerings.Stock Issued During Period, Value, New Issues, Registered Direct OfferingsIssuance of common stock pursuant to the registered direct offerings (Note 7)Number of new stock issued during the period pursuant to registered direct offerings.Stock Issued During Period, Shares, New Issues, Registered Direct OfferingsIssuance of common stock pursuant to the registered direct offerings (Note 7) (in shares)Equity impact of the value of new stock issued during the period pursuant to an at-the-market offering.Stock Issued During Period, Value, New Issues, At-the-Market OfferingIssuance of common stock pursuant to the ATM Program (Note 7)Number of new stock issued during the period pursuant to an at-the-market offering.Stock Issued During Period, Shares, New Issues, At-the-Market OfferingIssuance of common stock pursuant to the ATM Program (Note 7) (in shares)Number of new stock issued during the period pursuant to an equity offering.Stock Issued During Period, Shares, New Issues, Equity OfferingIssuance of common stock pursuant to the June Equity Offering, net of issuance costs (Note 7) (in shares)Equity impact of the value of new stock issued during the period pursuant to an equity offering.Stock Issued During Period, Value, New Issues, Equity OfferingIssuance of common stock pursuant to the June Equity Offering, net of issuance costs (Note 7)Capital stock, including shares designated as common shares and preferred shares.Par Value of Shares Issued [Member]Par Value of Shares Issued [Member]Number of new stock issued pursuant to the exercise of warrants during the period.Stock Issued During Period, Shares, Exercise of WarrantsIssuance of common stock pursuant to warrant exercises (Note 7) (in shares)Equity impact of the value of new stock issued pursuant to the exercise of warrants during the period.Stock Issued During Period, Value, Exercise of WarrantsIssuance of common stock pursuant to warrant exercises (Note 7)EX-101.PRE
8
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For the EDGAR submission types of Form 8-K: the date of the report, the date of the earliest event reported; for the EDGAR submission types of Form N-1A: the filing date; for all other submission types: the end of the reporting or transition period. The format of the date is YYYY-MM-DD.
The type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'.
Carrying value as of the balance sheet date of liabilities incurred (and for which invoices have typically been received) and payable to vendors for goods and services received that are used in an entity's business. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Amount for accounts payable to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Amount, after allowance for credit loss, of right to consideration from customer for product sold and service rendered in normal course of business, classified as current.
Carrying value as of the balance sheet date of obligations incurred and payable, pertaining to costs that are statutory in nature, are incurred on contractual obligations, or accumulate over time and for which invoices have not yet been received or will not be rendered. Examples include taxes, interest, rent and utilities. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Amount of excess of issue price over par or stated value of stock and from other transaction involving stock or stockholder. Includes, but is not limited to, additional paid-in capital (APIC) for common and preferred stock.
Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events.
Sum of the carrying amounts as of the balance sheet date of all assets that are expected to be realized in cash, sold, or consumed within one year (or the normal operating cycle, if longer). Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events.
Sum of the carrying amounts as of the balance sheet date of all assets that are expected to be realized in cash, sold or consumed after one year or beyond the normal operating cycle, if longer.
Amount, after accumulated amortization and accumulated impairment loss, of asset recognized from cost incurred to obtain or fulfill contract with customer; classified as current.
Amount, after accumulated amortization and accumulated impairment loss, of asset recognized from cost incurred to obtain or fulfill contract with customer; classified as noncurrent.
Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation.
Represents the caption on the face of the balance sheet to indicate that the entity has entered into (1) purchase or supply arrangements that will require expending a portion of its resources to meet the terms thereof, and (2) is exposed to potential losses or, less frequently, gains, arising from (a) possible claims against a company's resources due to future performance under contract terms, and (b) possible losses or likely gains from uncertainties that will ultimately be resolved when one or more future events that are deemed likely to occur do occur or fail to occur.
Aggregate par or stated value of issued nonredeemable common stock (or common stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable common shares, par value and other disclosure concepts are in another section within stockholders' equity.
The aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due within one year (or one business cycle).
Aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due after one year (or one business cycle).
Total obligations incurred as part of normal operations that are expected to be paid during the following twelve months or within one business cycle, if longer.
The amount for notes payable (written promise to pay), due to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Aggregate par or stated value of issued nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable preferred shares, par value and other disclosure concepts are in another section within stockholders' equity.
Amount of asset related to consideration paid in advance for costs that provide economic benefits in future periods, and amount of other assets that are expected to be realized or consumed within one year or the normal operating cycle, if longer.
Amount of asset related to consideration paid in advance for costs that provide economic benefits in future periods, and amount of other assets that are expected to be realized or consumed after one year or the normal operating cycle, if longer.
Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.
Amount of cash restricted as to withdrawal or usage, classified as current. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits.
Amount of cash restricted as to withdrawal or usage, classified as noncurrent. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits.
Carrying value as of the balance sheet date of the portion of long-term, collateralized debt obligations due within one year or the operating cycle, if longer. Such obligations include mortgage loans, chattel loans, and any other borrowings secured by assets of the borrower.
Carrying amount of collateralized debt obligations with maturities initially due after one year or beyond the operating cycle, if longer, excluding the current portion. Obligations include, but not limited to, mortgage loans, chattel loans, and other borrowings secured by assets.
Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.
Amount of interest payable on debt due to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury.
The maximum number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) permitted to be issued by an entity's charter and bylaws.
Total number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) issued to shareholders (includes related preferred shares that were issued, repurchased, and remain in the treasury). May be all or portion of the number of preferred shares authorized. Excludes preferred shares that are classified as debt.
Aggregate share number for all nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer) held by stockholders. Does not include preferred shares that have been repurchased.
Fees paid to related parties for providing a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Voyage expenses consist of: (a) port, canal and bunker expenses that are unique to a particular charter which are paid for by the charterer under the time charter arrangements or by the Company under voyage charter arrangements, and (b) brokerage commissions, which are always paid for by the Company, regardless of charter type.
Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.
The aggregate expense recognized in the current period that allocates the cost of tangible assets, intangible assets, or depleting assets to periods that benefit from use of the assets.
The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.
The aggregate total of expenses of managing and administering the affairs of an entity, including affiliates of the reporting entity, which are not directly or indirectly associated with the manufacture, sale or creation of a product or product line.
Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.
The aggregate amount of income or expense from ancillary business-related activities (that is to say, excluding major activities considered part of the normal operations of the business).
Generally recurring costs associated with normal operations except for the portion of these expenses which can be clearly related to production and included in cost of sales or services. Excludes Selling, General and Administrative Expense.
Amount of operating lease income from lease payments and variable lease payments paid and payable to lessor. Includes, but is not limited to, variable lease payments not included in measurement of lease receivable.
Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).
The average number of shares or units issued and outstanding that are used in calculating diluted EPS or earnings per unit (EPU), determined based on the timing of issuance of shares or units in the period.
Number of [basic] shares or units, after adjustment for contingently issuable shares or units and other shares or units not deemed outstanding, determined by relating the portion of time within a reporting period that common shares or units have been outstanding to the total time in that period.
Address commissions represent discount (sales incentive) on services rendered by the Company and no identifiable benefit is received in exchange for the consideration provided to the charterer.
Amount of selling, general and administrative expenses resulting from transactions, excluding transactions that are eliminated in consolidated or combined financial statements, with related party.
Adjustment to additional paid in capital resulting from the recognition of convertible debt instruments as two separate components - a debt component and an equity component. This bifurcation may result in a basis difference associated with the liability component that represents a temporary difference for purposes of applying accounting for income taxes. The initial recognition of deferred taxes for the tax effect of that temporary difference is as an adjustment to additional paid in capital.
Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.
The amount of amortization and write-off of beneficial conversion feature resulting from the recognition of convertible debt instruments as two separate components - a debt component and an equity component.
Amount of amortization expense attributable to debt issuance costs and write-off of amounts previously capitalized as debt issuance cost in an extinguishment of debt.
Amount of revenue recognized that was previously included in balance of obligation to transfer good or service to customer for which consideration from customer has been received or is due.
The increase (decrease) during the reporting period in the value of other expenditures made during the current reporting period for benefits that will be received over a period of years. Deferred charges differ from prepaid expenses in that they usually extend over a long period of time and may or may not be regularly recurring costs of operation.
Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation.
Amount of cash and cash equivalents, and cash and cash equivalents restricted to withdrawal or usage. Excludes amount for disposal group and discontinued operations. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits. Cash equivalents include, but are not limited to, short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.
Amount of increase (decrease) in cash, cash equivalents, and cash and cash equivalents restricted to withdrawal or usage; including effect from exchange rate change. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits. Cash equivalents include, but are not limited to, short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.
The value of the financial instrument(s) that the original debt is being converted into in a noncash (or part noncash) transaction. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or cash payments in the period.
The increase (decrease) during the reporting period in the aggregate amount of liabilities incurred (and for which invoices have typically been received) and payable to vendors for goods and services received that are used in an entity's business.
The increase (decrease) during the reporting period in amount due within one year (or one business cycle) from customers for the credit sale of goods and services.
The increase (decrease) during the reporting period in the value of expenditures made during the current reporting period for benefits that will be received over a period of years. Deferred charges differ from prepaid expenses in that they usually extend over a long period of time and may or may not be regularly recurring costs of operation.
Amount of increase (decrease) in deferred income and obligation to transfer product and service to customer for which consideration has been received or is receivable.
The increase (decrease) during the reporting period in receivables to be collected from other entities that could exert significant influence over the reporting entity.
The increase (decrease) during the reporting period in the aggregate value of all inventory held by the reporting entity, associated with underlying transactions that are classified as operating activities.
Amount of cash paid for interest, excluding capitalized interest, classified as operating activity. Includes, but is not limited to, payment to settle zero-coupon bond for accreted interest of debt discount and debt instrument with insignificant coupon interest rate in relation to effective interest rate of borrowing attributable to accreted interest of debt discount.
Amount of cash inflow (outflow) from financing activities, including discontinued operations. Financing activity cash flows include obtaining resources from owners and providing them with a return on, and a return of, their investment; borrowing money and repaying amounts borrowed, or settling the obligation; and obtaining and paying for other resources obtained from creditors on long-term credit.
Amount of cash inflow (outflow) from investing activities, including discontinued operations. Investing activity cash flows include making and collecting loans and acquiring and disposing of debt or equity instruments and property, plant, and equipment and other productive assets.
Amount of cash inflow (outflow) from operating activities, including discontinued operations. Operating activity cash flows include transactions, adjustments, and changes in value not defined as investing or financing activities.
Interest paid other than in cash for example by issuing additional debt securities. As a noncash item, it is added to net income when calculating cash provided by or used in operations using the indirect method.
The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets.
Amount of cash restricted as to withdrawal or usage. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits.
Castor
Maritime Inc. (“Castor”) was incorporated in September 2017 under the laws of the Republic of the Marshall Islands. The accompanying consolidated financial statements include the accounts of Castor and its wholly-owned subsidiaries (collectively, the “Company”).
The Company is engaged in the worldwide transportation of ocean-going cargoes through its vessel-owning subsidiaries. On December 21,
2018, Castor’s common shares began trading on the Norwegian OTC and on February 11, 2019, they began trading on the Nasdaq Capital Market, or Nasdaq, under the symbol “CTRM”. As of June 30, 2021, Castor was controlled by Thalassa Investment Co. S.A. (“Thalassa”) by virtue of the 100% Series B preferred shares owned by it and, as a result, could control the outcome of matters on which shareholders are entitled to vote. Thalassa
is controlled by Petros Panagiotidis, the Company's Chairman, Chief Executive Officer and Chief Financial Officer.
Pavimar
S.A., a corporation incorporated under the laws of the Republic of the Marshall Islands (“Pavimar”), a related party controlled by the sister of Petros Panagiotidis, Ismini Panagiotidis, provides technical, crew and operational management services to the Company.
Castor
Ships S.A., a corporation incorporated under the laws of the Republic of the Marshall Islands (“Castor Ships”), a related party controlled by the Company’s Chairman, Chief Executive Officer and Chief Financial Officer, manages overall the Company’s business and provides commercial shipmanagement, chartering and administrative
services to the Company.
As of June 30, 2021, the Company owned a diversified fleet of 23 vessels, with a combined carrying capacity of 2.0 million
dwt, consisting of 1 Capesize, 6
Kamsarmax and 8 Panamax dry bulk vessels, as well as 1 Aframax, 5 Aframax/LR2 and 2 MR1 tankers. Details of the Company’s vessel owning subsidiary companies as of June 30, 2021 are listed below.
Vessel owning
subsidiaries consolidated:
Company
Country of incorporation
Vessel Name
DWT
Year Built
Delivery date to Castor
Spetses Shipping Co. (“Spetses”)
Marshall Islands
M/V Magic P
76,453
2004
February 2017
Bistro Maritime Co. (“Bistro”)
Marshall Islands
M/V Magic Sun
75,311
2001
September 2019
Pikachu Shipping Co. (“Pikachu”)
Marshall Islands
M/V Magic Moon
76,602
2005
October 2019
Bagheera Shipping Co. (“Bagheera”)
Marshall Islands
M/V Magic Rainbow
73,593
2007
August 2020
Pocahontas Shipping Co. (“Pocahontas”)
Marshall Islands
M/V Magic Horizon
76,619
2010
October 2020
Jumaru Shipping Co. (“Jumaru”)
Marshall Islands
M/V Magic Nova
78,833
2010
October 2020
Super Mario Shipping Co. (“Super Mario”)
Marshall Islands
M/V Magic Venus
83,416
2010
March 2021
Pumba Shipping Co. (“Pumba”)
Marshall Islands
M/V Magic Orion
180,200
2006
March 2021
Kabamaru Shipping Co. (“Kabamaru”)
Marshall Islands
M/V Magic Argo
82,338
2009
March 2021
Luffy Shipping Co. (“Luffy”)
Marshall Islands
M/V Magic Twilight
80,283
2010
April 2021
Liono Shipping Co. (“Liono”)
Marshall Islands
M/V Magic Thunder
83,375
2011
April 2021
Stewie Shipping Co. (“Stewie”)
Marshall Islands
M/V Magic Vela
75,003
2011
May 2021
Snoopy Shipping Co. (“Snoopy”)
Marshall Islands
M/V Magic Nebula
80,281
2010
May 2021
Mulan Shipping Co. (“Mulan”)
Marshall Islands
M/V Magic Starlight
81,048
2015
May 2021
Cinderella Shipping Co. (“Cinderella”)
Marshall Islands
M/V Magic Eclipse
74,940
2011
June 2021
Rocket Shipping Co. (“Rocket”)
Marshall Islands
M/T Wonder Polaris
115,341
2005
March 2021
Gamora Shipping Co. (“Gamora”)
Marshall Islands
M/T Wonder Sirius
115,341
2005
March 2021
Starlord Shipping Co. (“Starlord”)
Marshall Islands
M/T Wonder Vega
106,062
2005
May 2021
Hawkeye Shipping Co. (“Hawkeye”)
Marshall Islands
M/T Wonder Avior
106,162
2004
May 2021
Elektra Shipping Co. (“Elektra”)
Marshall Islands
M/T Wonder Arcturus
106,149
2002
May 2021
Vision Shipping Co. (“Vision”)
Marshall Islands
M/T Wonder Mimosa
37,620
2006
May 2021
Colossus Shipping Co. (“Colossus”)
Marshall Islands
M/T Wonder Musica
106,209
2004
June 2021
Xavier Shipping Co. (“Xavier”)
Marshall Islands
M/T Wonder Formosa
37,562
2006
June 2021
The
accompanying unaudited interim condensed consolidated financial statements include the accounts of Castor and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and applicable rules and regulations of the
U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. These statements and the accompanying
notes should be read in conjunction with the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2020, filed with the SEC on March 30, 2021 (the “2020 Annual Report”).
These
unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments
considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. Operating results for the six-month period ended June 30, 2021 are not necessarily indicative of the
results that might be expected for the fiscal year ending December 31, 2021.
Significant Accounting Policies and
Recent Accounting Pronouncements:
A discussion of the Company's significant
accounting policies can be found in the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report. Apart from the below, there have been no material changes to these policies in the six-month
period ended June 30, 2021.
New significant accounting policies adopted
during the six months ended June 30, 2021
Segment Reporting
The Company reports financial information and evaluates its operations by charter revenues and not by the length, type of vessel or type of ship employment for its customers,
i.e. time or voyage charters. The Company does not use discrete financial information to evaluate the operating results for each such type of charter or vessel. Although revenue can be identified for these types of charters or vessels, management
cannot and does not identify expenses, profitability or other financial information for these various types of charters or vessels. As a result, management, including the chief operating decision
maker, reviews operating results solely by revenue per day and operating results of the fleet, and thus the Company has determined that it operates as one
reportable segment. Furthermore, when the Company charters a vessel to a charterer, the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographic information is impracticable.
Recent Accounting Pronouncements
There are no recent accounting pronouncements the adoption of which are expected to have a material effect on the Company’s unaudited interim consolidated
condensed financial statements in the current period.
During the six month
periods ended June 30, 2020 and 2021, the Company incurred the following charges in connection with related party transactions, which are included in the accompanying unaudited interim condensed consolidated statements of comprehensive income/
(loss):
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Management fees-related parties
Management fees – Pavimar (a)
$
273,000
$
1,782,000
Management fees – Castor Ships (c)
—
742,500
Included in Voyage expenses
Charter hire commissions – Castor Ships (c)
$
—
$
364,540
Included in Interest and finance costs
Interest expenses (b) – Thalassa
$
151,667
$
150,833
Included in General and administrative expenses
Administration fees – Castor Ships (c)
$
—
$
600,000
Included in Vessels’ cost
Sale & purchase commission – Castor Ships (c)
$
—
$
2,426,800
As of December 31, 2020
and June 30, 2021, balances with related parties consisted of the following:
December 31, 2020
June 30, 2021
Assets:
Working capital advances granted to Pavimar (a) – current
$
1,559,132
$
1,831,311
Working capital advances granted to Pavimar (a) – non-current
—
1,104,394
Liabilities:
Related party debt (b) – Thalassa
$
5,000,000
$
5,000,000
Accrued loan interest (b) – Thalassa
405,000
555,833
Voyage commissions & management fees due to Castor Ships (c)
1,941
97,445
Management fees due to Pavimar (a)
—
101,400
(a)
Pavimar:
Each of the Company’s ship-owning subsidiaries have entered into separate vessel management agreements with Pavimar, a company controlled by Ismini Panagiotidis, the sister of Petros
Panagiotidis (see Note 1). Pursuant to the terms of the management agreements, Pavimar provides the Company with a wide range of shipping services, including crew management, technical management, operational employment management, insurance
arrangements, provisioning, bunkering, vessel accounting and audit support services, in exchange for a daily fee. During the six month period ended June 30,
2020, the Company’s vessels then comprising its fleet were charged with a daily management fee of $500 per day per vessel.
On September 1, 2020, the Company’s then shipowning subsidiaries entered into revised
shipmanagement agreements with Pavimar which replaced the then existing shipmanagement agreements in their entirety (the “Technical Management Agreements”). Pursuant to the Technical Management Agreements, effective September 1, 2020, Pavimar
provides the Company’s shipowning subsidiaries with the range of technical, crewing, insurance and operational services stipulated in the previous agreements in exchange for which Pavimar is now paid a daily fee of $600 per vessel, which shall be also subject to an annual review on their anniversary date. The Technical Management Agreements have a term of five years and such
term automatically renews for a successive five year term on each anniversary of their effective date, unless the agreements are terminated earlier in accordance with the
provisions contained therein. In the event that the Technical Management Agreements are terminated by the ship-owning subsidiaries other than by reason of default by Pavimar, a termination fee equal to four times the total amount of the daily management fee calculated on an annual basis shall be payable from the ship-owning subsidiaries to Pavimar.
As of June 30, 2021, Pavimar has subcontracted the technical management of three
of the Company’s dry bulk vessels and eight of its tanker vessels to third-party ship-management companies. These third-party management
companies provide technical management to the respective vessels for a fixed annual fee which is paid by Pavimar at its own expense. In connection with the subcontracting services rendered by the third-party ship-management companies, the Company
has as of June 30, 2021 paid Pavimar working capital guarantee deposits aggregating the amount of $1,362,646, of which $258,252 are included in Due from related party, current and $1,104,394 are presented in Due from related party, non-current in the accompanying unaudited interim consolidated balance sheets.
During the six months ended June 30, 2020 and 2021, the Company incurred management fees under the Technical Management Agreements amounting to$273,000 and $1,782,000, respectively, which are separately presented in Management fees to related parties in the accompanying unaudited interim
condensed consolidated statements of comprehensive income/(loss).
In addition, Pavimar and its subcontractor third-party managers make payments for operating expenses
with funds paid in advance from the Company to Pavimar. As of December 31, 2020 and June 30, 2021, amounts of $1,559,132 and $1,573,059, respectively, were due from Pavimar in relation to these working capital advances granted to it, net of payments
made by Pavimar on behalf of the Company vessels.
(b) Thalassa:
$5.0 Million Term Loan Facility
Details of the Company’s loan agreement
with Thalassa are discussed in Note
3 of the consolidated financial statements for the year ended December 31, 2020,
included in the Company’s 2020 Annual Report.
During the six months ended June 30, 2020 and 2021, the Company incurred interest costs in connection with the $5.0 million unsecured term loan with Thalassa (the “$5.0 Million Term Loan
Facility”) amounting to $151,667 and $150,833, which are included in Interest and finance costs in the accompanying unaudited interim consolidated statements of comprehensive
income/(loss).
As of June 30, 2021, no amounts were prepaid under the $5.0
Million Term Loan Facility.
(c) Castor Ships:
On September 1, 2020, the Company and its shipowning subsidiaries entered into a master management agreement (the “Master Agreement”) with Castor Ships. Pursuant to the terms
of the Master Agreement each of the Company’s shipowning subsidiaries also entered into separate commercial shipmanagement agreements with Castor Ships (the “Commercial Shipmanagement Agreements” and together with the Master Agreement, the “Castor
Ships Management Agreements”). Under the terms of the Castor Ships Management Agreements, Castor Ships manages overall the Company’s business and provides commercial shipmanagement, chartering and administrative services, including, but not limited
to, securing employment for the Company’s fleet, arranging and supervising the vessels’ commercial operations, handling all the Company’s vessel sale and purchase transactions, undertaking related shipping project and management advisory and
support services, as well as other associated services requested from time to time by the Company and its shipowning subsidiaries. In exchange for these services, the Company and its subsidiaries pay Castor Ships (i) a flat quarterly management fee
in the amount of $0.3 million for the management and administration of the Company’s business, (ii) a daily fee of $250 per vessel for the provision of the services under the Commercial Shipmanagement Agreements, (iii) a commission rate of 1.25% on all charter agreements arranged by Castor Ships and (iv) a commission of 1% on each vessel sale and purchase transaction.
The Castor Ships Management Agreements have a term of five years
and such term automatically renews for a successive five year term on each anniversary of the effective date, unless the agreements are
terminated earlier in accordance with the provisions contained therein. In the event that the Castor Ships Management Agreements are terminated by the Company, or are terminated by Castor Ships due to a material breach of the Master Agreement by
the Company or a change of control in the Company, Castor Ships shall be entitled to a termination fee equal to four times the total
amount of the flat management fee and the per vessel management fees calculated on an annual basis. The Commercial Shipmanagement Agreements also provide that the management fees shall be subject to an annual review on their anniversary.
During the six month period ended June 30, 2021, the Company
incurred (i) management fees amounting to $600,000 for the management and administration of the Company’s business, which are included in
General and administrative expenses in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss), (ii) management fees amounting to $742,500 for the provision of the services under the Commercial Shipmanagement Agreements which are included in Management fees to related parties in the accompanying unaudited
interim condensed consolidated statements of comprehensive income/(loss), (iii) charter hire commissions amounting to $364,540 which are
included in Voyage expenses in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss) and (iv) sale and purchase commission amounting to $2,426,800 which is included in Vessels, net in the accompanying unaudited interim consolidated balance sheet.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
The movement in
deferred dry-docking costs, net in the accompanying unaudited interim consolidated balance sheets, is as follows:
Dry-docking
costs
Balance December 31, 2020
$
2,061,573
Additions
1,250,632
Amortization
(353,681
)
Balance June 30, 2021
$
2,958,524
On November 27, 2020, the Magic Moon commenced its scheduled dry-dock
which was completed on January 13, 2021 and, on May 11, 2021 the Magic Rainbow commenced its scheduled dry-dock
which was completed on June 7, 2021. The Wonder Mimosa was undergoing dry-dock as of
June 30, 2021. Amortization of deferred dry-docking costs is included in Depreciation and amortization in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss).
The amounts in the accompanying unaudited interim consolidated balance sheets are analyzed as follows:
Vessel Cost
Accumulated depreciation
Net Book Value
Balance December 31, 2020
60,906,094
(2,860,466
)
58,045,628
— Acquisitions, improvements and other vessel costs
213,027,388
—
213,027,388
—Transfers from Advances for vessel acquisitions
33,130,851
—
33,130,851
—Period depreciation
—
(3,686,920
)
(3,686,920
)
Balance June 30, 2021
307,064,333
(6,547,386
)
300,516,947
Vessel Acquisitions and other Capital Expenditures:
During the six month period ended June 30, 2021, the
Company agreed to acquire 12 dry bulk carriers and 8 tanker vessels for an aggregate cash consideration of $303.7 million (the
“2021 Vessel Acquisitions”). Of the 2021 Vessel Acquisitions, 17 were concluded during the six months ended June 30, 2021, whereas, the remaining are expected to be concluded in the third quarter of 2021. The concluded acquisitions were
financed in their entirety with cash on hand. Details regarding the 2021 Vessel Acquisitions delivered as of June 30, 2021,
are discussed below.
On January 20, 2021, the Company, through Pumba, entered into an agreement to purchase
a 2006 Japanese-built Capesize dry bulk carrier, the Magic Orion, from an unaffiliated third party for a purchase price of $17.5 million. The Magic Orion was delivered to the Company on March 17, 2021.
On January 28, 2021, the Company, through Super Mario, entered into an agreement to purchase a 2010 Japanese-built Kamsarmax dry bulk
carrier, the Magic Venus, from an unaffiliated third party
for a purchase price of $15.89 million. The Magic Venus was delivered to the Company on March 2, 2021.
On February 2, 2021, the Company, through Kabamaru, entered into an agreement to purchase a 2009 Japanese-built Kamsarmax dry bulk carrier,
the Magic Argo, from an unaffiliated third party for a
purchase price of $14.5 million. The Magic Argo was delivered to the Company on March 18, 2021.
On February 5, 2021, the Company, through Rocket and Gamora, entered into agreements to purchase two 2005 Korean-built Aframax LR2 tankers, the Wonder Polaris and the Wonder Sirius, for an aggregate purchase price of $27.2 million from an unaffiliated third-party seller. The Wonder Polaris and the Wonder Sirius were delivered to the Company on March 11, 2021 and March 22, 2021, respectively.
On February 18, 2021, the Company, through Luffy, entered into an agreement to purchase a 2010 Korean-built Kamsarmax dry bulk carrier, the Magic Twilight, from an unaffiliated third party for a purchase price of
$14.8 million. The Magic
Twilight was delivered to the Company on April 9, 2021.
On March 9, 2021, the Company, through Snoopy, entered into an agreement to purchase a 2010 Korean-built Kamsarmax dry bulk carrier, the Magic Nebula, from an unaffiliated third party for a purchase price of $15.5 million. The Magic Nebula was delivered to the Company on May 20, 2021.
On March 11, 2021, the Company, through Liono, entered into an agreement to purchase a 2011 Japanese-built Kamsarmax dry bulk carrier, the Magic Thunder, from an unaffiliated third party for a purchase price of $16.9 million. The Magic Thunder was delivered to the Company on April 13, 2021.
On April 9, 2021, the Company, through Cinderella, entered into an agreement to purchase a 2011 Japanese-built Panamax dry bulk carrier, the Magic Eclipse, from an unaffiliated third party for a purchase price of $18.5 million. The Magic Eclipse was delivered to the Company on June 7, 2021.
On April 15, 2021, the Company, through Mulan, entered into an agreement to purchase a 2015 Chinese-built Kamsarmax dry bulk carrier, the Magic Starlight, from an unaffiliated third party for a purchase price of
$23.5 million. The Magic
Starlight was delivered to the Company on May 23, 2021.
On April 16, 2021, the Company, through Starlord, entered into an agreement to purchase a 2005 Korean-built Aframax tanker, the Wonder Vega, from an unaffiliated third party for a purchase price of $14.8 million. The Wonder Vega was delivered to the Company on May 21, 2021.
On April 27, 2021, the Company, through Stewie, entered
into an agreement to purchase a 2011 Chinese-built Panamax dry bulk carrier, the Magic Vela, from an unaffiliated third party for a purchase price of $14.5 million. The Magic Vela was delivered to the Company on May 12, 2021.
On April 29, 2021, the Company, through Vision, Xavier, Hawkeye, Colossus and Elektra,
entered into separate agreements for the en bloc acquisition from an unaffiliated third party of a tanker fleet comprising of two 2006 Korean-built MR1 tankers, two 2004 Korean-built Aframax/LR2
tankers and one 2002 Korean-built Aframax/LR2 tanker for an aggregate purchase price
of $49.3 million. The Wonder Avior, Wonder Mimosa,
Wonder Arcturus, Wonder Musica and Wonder Formosa were
delivered to the Company on May 27, May 31, May 31, June 15 and June 22, 2021, respectively.
During the six months ended June 30,
2021, the Company incurred aggregate vessel improvement costs of $0.9 million related to (i) the partial installation of a ballast
water management system (“BWMS”) on the Wonder Mimosa that was undergoing dry dock as of June 30, 2021, and (ii) the $349,287 consideration paid for the already installed BWMS of the Magic Vela upon completion of its acquisition from the Company.
As of June 30, 2021, 8
of the 23 vessels in the Company’s fleet having an aggregate carrying value of $75,644,907 were first priority mortgaged as collateral to their loan facilities (Note 6).
(b) Advances for vessel acquisitions
The amounts in the accompanying unaudited interim consolidated balance sheets are analyzed as follows:
Vessel Cost
Balance December 31, 2020
$
—
— Advances for vessel acquisitions and other vessel pre-delivery costs
42,373,858
—Transfer to Vessels, net (a)
(33,130,851
)
Balance June 30, 2021
$
9,243,007
During the six months ended June 30, 2021, the Company took delivery of a number of the vessels discussed under (a) above and, hence, advances paid in the period for these vessels
were transferred from Advances for vessel acquisitions to Vessels, net.
The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections.
The amount of long-term debt (including related party debt discussed under Note 3) shown in the accompanying unaudited interim consolidated balance sheet of June 30, 2021, is analyzed as follows:
Year/Period Ended
Loan facilities
Borrowers- Issuers
December 31,
2020
June 30,
2021
$11.0 Million Term Loan Facility (a)
Spetses- Pikachu
$
9,400,000
$
8,600,000
$4.5 Million Term Loan Facility (b)
Bistro
4,050,000
3,750,000
$15.3 Million Term Loan Facility (c)
Pocahontas- Jumaru
—
14,819,000
$18.0
Million Term Loan Facility (d)
Rocket- Gamora
—
18,000,000
Total long-term debt
$
13,450,000
$
45,169,000
Less: Deferred financing costs
(264,134
)
(894,951
)
Total long-term debt, net of deferred finance costs
$
13,185,866
44,274,049
Presented:
Current portion of long-term debt
$
2,200,000
$
7,484,000
Less: Current portion of deferred finance costs
(97,963
)
(330,590
)
Current portion of long-term debt, net of deferred finance costs
$
2,102,037
$
7,153,410
Non-Current portion of long-term debt
11,250,000
37,685,000
Less: Non-Current portion of deferred finance costs
(166,171
)
(564,361
)
Non-Current portion of long-term debt, net of deferred finance costs
$
11,083,829
$
37,120,639
Debt instruments from related party
$5.0 Million Term Loan Facility (Note 3(b))
Castor
5,000,000
5,000,000
Total long-term debt from related party, current
$
5,000,000
$
5,000,000
a.
$11.0 Million Term Loan Facility:
Details of the
Company’s $11.0 million senior secured credit facility with Alpha Bank A.E, or the $11.0 Million Term Loan Facility, are discussed in (Note 6) of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual
Report.
b.
$4.5 Million Term Loan Facility:
Details of the Company’s $4.5 million senior secured credit facility with Chailease International Financial Services Co. Ltd., or the $4.5 Million Term Loan Facility, are discussed in
(Note 6) of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report.
c.
$15.3 Million Term Loan Facility
On January 22, 2021, pursuant to the terms of a credit agreement, Pocahontas and Jumaru, the Company’s wholly-owned subsidiaries, entered into a $15.3 million senior secured term loan facility with Hamburg Commercial Bank AG, or the $15.3
Million Term Loan Facility. The loan was drawn down on January 27, 2021, is repayable in sixteen (16) equal quarterly installments of $471,000 each, plus a balloon installment in the amount of $7.8
million payable at maturity and bears interest at a margin plus LIBOR per annum. The facility contains a standard security package including first preferred mortgages on the vessels, pledge of bank accounts, charter assignments, shares pledge and a
general assignment over the vessels' earnings, insurances and any requisition compensation in relation to the vessels owned by the borrowers, and is guaranteed by the Company. Pursuant to the terms of the $15.3 Million Term Loan Facility, the Company is also subject to a certain minimum liquidity restriction requiring the borrowers to maintain a certain credit balance with the
lender (the “Minimum Liquidity Accounts”), to maintain and gradually fund certain dry-dock reserve accounts (the “Dry-dock Reserve Accounts”) in order to ensure the payment of any costs incurred in relation to the next dry-docking of each mortgaged
vessel, as well as to certain customary, for this type of facilities, negative covenants. The credit agreement governing the $15.3
Million Term Loan Facility also requires maintenance of a minimum security cover ratio being the aggregate amount of (i) the fair market value of the collateral vessels, (ii) the value of the Minimum Liquidity Accounts, (iii) the value of the
Dry-dock Reserve Accounts and (iv) any additional security provided, over the aggregate principal amount outstanding of the loan.
The $15.3 Million
Term Loan Facility net proceeds were used to fund the 2021 Vessel Acquisitions (Note 5(a)) and for general corporate purposes.
d.
$18.0 Million Term Loan Facility
On April 27, 2021, the Company, through Rocket and Gamora, its
wholly-owned subsidiaries owning the Wonder Sirius and the Wonder Polaris (the
“Borrowers”), entered into a $18.0 million senior secured term loan facility with Alpha Bank A.E., or the $18.0 Million Term Loan Facility. The facility was drawn down on May 7, 2021. The $18.0 Million Term Loan Facility has a term of four years from the drawdown
date, bears interest at a margin over LIBOR per annum and is repayable in (a) sixteen (16) quarterly installments (1 to 4 in the amount of $850,000 and 5 to 16 in the amount of $675,000)
and (b) a balloon installment in the amount of $6.0 million payable at maturity. The facility is secured by first preferred mortgage and
first priority general assignment covering earnings, insurances and requisition compensation over the vessels owned by the Borrowers, an earnings account pledge, shares security deed relating to the shares of the vessels’ owning subsidiaries,
manager’s undertakings and is guaranteed by the Company. The $18.0 Million Term Loan Facility net proceeds were used to fund the 2021 Vessel Acquisitions (Note 5(a)) and for general corporate purposes. The $18.0 Million Term Loan Facility contains certain customary minimum liquidity restrictions and financial covenants that require the Borrowers to maintain a certain level of minimum free
liquidity per collateralized vessel (“the Minimum Liquidity Deposit”) and meet a specified minimum security requirement ratio, which is the ratio of the aggregate market value of the mortgaged vessels plus the value of any additional security and
the value of the Minimum Liquidity Deposit to the aggregate principal amounts due under the $18.0 Term Loan Facility.
As of June 30, 2021, the Company was in compliance with all financial covenants prescribed in its debt agreements.
Restricted cash as of June 30, 2021 includes (i) $2.2 million of minimum liquidity deposits required pursuant to the $11.0 Million Term Loan
Facility, the $18.0 Million Term Loan Facility and the $15.3 Million Term Loan Facility, (ii) $0.05 million in the Dry-dock Reserve
Accounts and (iii) $0.4 million of retention deposits.
Restricted cash as of December 31, 2020, includes $0.5 million of non-legally restricted cash as per the $11.0 Million Term Loan Facility minimum
liquidity requirements, or $0.25 million per collateralized vessel.
The annual principal payments for the Company’s outstanding debt arrangements as of June 30, 2021 (including related party debt
discussed under Note 3), required to be made after the balance sheet date, are as follows:
Twelve-month period ending June 30,
Amount
2022
$
12,484,000
2023
6,784,000
2024
6,784,000
2025
24,117,000
Total long-term debt (including related party debt)
$
50,169,000
The weighted average interest rate on the Company’s long-term debt for the six months ended June 30, 2020 and 2021 was 5.4%
and 4.0% respectively.
Total interest incurred on long-term debt for the six months ended June 30, 2020 and 2021, amounted to $583,996 and $730,851 respectively, and is included in Interest and finance costs (Note 14) in the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss).
Under the Company's
articles of incorporation, the Company's authorized capital stock consists of 2,000,000,000 shares, par value $0.001 per share, of which 1,950,000,000
shares are designated as common shares and 50,000,000 shares are designated as preferred shares. For a further description of the
terms and rights of the Company’s capital stock and details of its previous equity transactions please refer to Note 7 of the consolidated financial statements for the year ended December 31, 2020, included in the Company’s 2020 Annual Report.
2021 First Registered
Direct Equity Offering
On December 30, 2020,
the Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 9,475,000
common shares and warrants to purchase up to 9,475,000 common shares (the “2021 First Private Placement Warrants”) in a registered
direct offering or the 2021 First Registered Direct Equity Offering. In connection with the 2021 First Registered Direct Equity Offering, which closed on January 5, 2021, the Company received gross and net cash proceeds of approximately $18.0 million and $16.5 million,
respectively.
The 2021 First Private
Placement Warrants issued in the 2021 First Registered Direct Equity Offering had a term of five years and were exercisable immediately
and throughout their term for $1.90 per common share (American style option). The exercise price of the 2021 First Private Placement
Warrants was subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
As of February 10,
2021, all the 2021 First Private Placement Warrants had been exercised, and, pursuant to their exercise and the issuance by the Company of 9,475,000
common shares, the Company received gross and net proceeds of $18.0 million.
On initial recognition
the fair value of the 2021 First Private Placement Warrants was $22.2 million and was determined using the Black-Scholes methodology. The
fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 First Private Placement Warrants
was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 First Private Placement Warrants valuation
was 137.5%. A 5%
increase in the volatility applied would have led to an increase of 1.7% in the fair value of the 2021 First Private Placement Warrants.
2021 Second Registered
Direct Equity Offering
On January 8, 2021, the
Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 13,700,000
common shares and warrants to purchase up to 13,700,000 common shares (the “2021 Second Private Placement Warrants”) in a registered
direct offering or the 2021 Second Registered Direct Equity Offering. In connection with the 2021 Second Registered Direct Equity Offering, which closed on January 12, 2021, the Company received gross and net cash proceeds of approximately $26.0 million and $24.1 million,
respectively.
The 2021 Second Private
Placement Warrants issued in the 2021 Second Registered Direct Equity Offering had a term of five years and were exercisable immediately
and throughout their term for $1.90 per common share (American style option). The exercise price of the 2021 Second Private Placement
Warrants was subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
As of February 10,
2021, all the 2021 Second Private Placement Warrants had been exercised, and, pursuant to their exercise and the issuance by the Company of 13,700,000
common shares, the Company received gross and net proceeds of $26.0 million.
On initial recognition
the fair value of the 2021 Second Private Placement Warrants was $37.3 million and was determined using the Black-Scholes methodology.
The fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 Second Private Placement
Warrants was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 Second Private Placement Warrants
valuation was 152.1%. A 5%
increase in the volatility applied would have led to an increase of 1.3% in the fair value of the 2021 Second Private Placement
Warrants.
2021 Third Registered
Direct Equity Offering
On April 5, 2021, the
Company entered into agreements with certain unaffiliated institutional investors pursuant to which it offered and sold 19,230,770
common shares and warrants to purchase up to 19,230,770 common shares (the “2021 Third Private Placement Warrants”) in a registered
direct offering or the 2021 Third Registered Direct Equity Offering. In connection with the 2021 Third Registered Direct Equity Offering, which closed on April 7, 2021, the Company received gross and net cash proceeds of approximately $125.0 million and $116.3 million,
respectively.
The 2021 Third Private
Placement Warrants issued in the 2021 Third Registered Direct Equity Offering have a term of five years and are exercisable immediately
and throughout their term for $6.50 per common share (American style option). The exercise price of the 2021 Third Private Placement
Warrants is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common shares and also upon any distributions of
assets, including cash, stock or other property to existing shareholders.
Between their issuance
date and June 30, 2021, there were no exercises of the Third Private Placement Warrants and, as a result, as of June 30, 2021, 19,230,770 Third Private Placement Warrants remained unexercised and potentially issuable into common stock of the Company.
On initial recognition
the fair value of the 2021 Third Private Placement Warrants was $106.6 million and was determined using the Black-Scholes methodology.
The fair value was considered by the Company to be classified as Level 3 in the fair value hierarchy since it was derived by unobservable inputs. The major unobservable input in connection with the valuation of the 2021 Third Private Placement
Warrants was the volatility used in the valuation model, which was approximated by using historical observations of the Company’s share price. The annualized historical volatility that has been applied in the 2021 Third Private Placement Warrants
valuation was 201.7%. A 5%
increase in the volatility applied would have led to an increase of 0.7% in the fair value of the 2021 Third Private Placement Warrants.
The Company accounted for the 2021 First, Second and Third Private Placement Warrants as equity in accordance with the accounting
guidance under ASC 815-40. The accounting guidance provides a scope exception from classifying and measuring as a financial liability a contract that would otherwise meet the definition of a derivative if the contract is both (i) indexed to the
entity's own stock and (ii) meets the equity classifications conditions. The Company concluded these warrants were equity-classified since they contained no provisions which would require the Company to account for the warrants as a derivative
liability, and therefore were initially measured at fair value in permanent equity with subsequent changes in fair value not measured.
At-the-market (“ATM”)
common stock offering program
On June 14, 2021, the
Company, entered into an equity distribution agreement, or as commonly referred to, an at-the-market offering, with Maxim Group LLC (“Maxim”), under which the Company may sell an aggregate offering price of up to $300.0 million of its common stock with Maxim acting as a sales agent over a minimum period of 12 months (the “ATM Program”). No warrants, derivatives, or other share classes were associated with this transaction. As of June 30, 2021, the Company had received gross proceeds of $10.1 million under the ATM Program by issuing 3,563,407
common shares, whereas, the net proceeds under the ATM Program, after deducting sales commissions and other transaction fees and expenses, amounted to $9.7
million.
Issuance of common stock
in connection with the Class A Warrants and the July 2020 equity offering warrants
During the six months
ended June 30, 2021, the Company issued 5,546,705 common shares upon the exercise of an equivalent number of Class A Warrants issued in
the June 2020 follow-on offering and 5,707,135 common shares upon the exercise of an equivalent number of warrants issued in the July
2020 follow-on equity offering. As of June 30, 2021, the Company raised $39.4 million in proceeds from the partial exercise of
warrants issued in the respective equity offerings.
Reverse Stock Split
On May 28, 2021, the
Company effected a 1-for-10 reverse stock split of its common stock without any change in the number of authorized common shares. All
share and per share amounts, as well as warrant shares eligible for purchase under the Company's effective warrant schemes in the accompanying unaudited interim consolidated financial statements have been retroactively adjusted to reflect the
reverse stock split. As a result of the reverse stock split, the number of outstanding shares as of May 28, 2021, was decreased to 89,955,848
while the par value of the Company's common shares remained unchanged to $0.001 per share.
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
The principal financial
assets of the Company consist of cash at banks, restricted cash, trade accounts receivable and amounts due from related party. The principal financial liabilities of the Company consist of trade accounts payable, amounts due to related parties and
long-term debt (including related party debt).
The following methods and
assumptions were used to estimate the fair value of each class of financial instruments:
◾
Cash and cash equivalents,
restricted cash, trade accounts receivable, amounts due from related party and trade accounts payable: The carrying values reported in the accompanying unaudited interim consolidated balance sheets for those financial instruments are reasonable estimates of their fair values due to their short-term maturity nature. Cash
and cash equivalents and restricted cash, current are considered Level 1 items as they represent liquid assets with short term maturities. The carrying value approximates the fair market value for interest bearing cash classified as
restricted cash, non-current and is considered Level 1 item of the fair value hierarchy. The carrying value of these instruments is separately reflected in the accompanying unaudited interim consolidated balance sheets.
◾
Long-term debt: The secured credit facilities discussed in Note 6, have a recorded value which is a
reasonable estimate of their fair value due to their variable interest rate and are thus considered Level 2 items in accordance with the fair value hierarchy as LIBOR rates are observable at commonly quoted intervals for the full terms of
the loans. The fair value of the fixed interest bearing $5.0 Million Term Loan Facility, discussed in Note 3, determined through
Level 2 inputs of the fair value hierarchy (quoted prices for identical or similar assets and liabilities in markets that are not active), approximates its recorded value as of June 30, 2021.
Concentration
of credit risk: Financial instruments, which
potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents and trade accounts receivable. The Company places its cash and cash equivalents, consisting mostly of deposits, with high
credit qualified financial institutions. The Company performs periodic evaluations of the relative credit standing of the financial institutions in which it places its deposits. The Company limits its credit risk with accounts receivable by performing ongoing credit evaluations of its customers'
financial condition.
The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.
Various claims,
lawsuits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims
with suppliers relating to the operations of the Company's vessels. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying
unaudited interim consolidated financial statements.
The Company accrues for
the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities, which should
be disclosed, or for which a provision should be established in the accompanying unaudited interim consolidated financial statements. The Company is covered for liabilities associated with the vessels’ actions to the maximum limits as provided by
Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs.
(a)
Commitments under Contracts for BWMS
Installation
On November 15, 2018,
the Company entered into a contract to purchase and install BWMS on its dry bulk carriers, which was further amended on October 20, 2019 and December 8, 2020, to reflect the Company’s vessel acquisitions, as applicable in each period. The Company
completed the BWMS installation on the Magic Sun during the vessel’s scheduled dry-docking which took place in the fourth quarter of 2020 and the BWMS was put into use during the second quarter of 2021. The BWMS system installations on the Magic P
and the Magic Moon were granted extensions from the third quarter of 2020 to the third quarter of 2022. It is estimated that the contractual obligations related to these purchases as well as purchases on the Company’s remaining fleet vessels (where
not already installed), excluding installation costs, will be approximately €0.6 million (or $0.7 million on the basis of a Euro/US Dollar exchange rate of €1.0000/$1.1904
as of June 30, 2021), of which $0.01 million are due in 2021 and $0.69 million are due in 2022. These costs will be capitalized and depreciated over the remainder of the life of each vessel.
(b)
Commitments under long-term lease
contracts
The
following table sets forth the Company’s future minimum contracted lease payments (gross of charterers’ commissions), based on vessels’ commitments to non-cancelable fixed time charter contracts as of June 30, 2021. The
calculation does not include any assumed off-hire days.
The Company calculates earnings/(loss) per share by dividing net
income/(loss) available to common stockholders in each period by the weighted-average number of common shares outstanding during that period, after adjusting for the effect of cumulative dividends on the Series A Preferred Shares, whether or not
earned, and only at periods when dividends on the Series A Preferred Shares are contractually allowed to accumulate. As further disclosed under Note 7 of the audited financial statements included in the 2020 Annual Report, dividends on the
Series A Preferred Shares neither accrue nor accumulate during the period from July 1, 2019 until December 31, 2021 and the Company does not have any dividend priority restrictions to holders of its common shares during this period.
Diluted earnings/(loss) per share, if applicable, reflects the
potential dilution that could occur if potentially dilutive instruments were exercised, resulting in the issuance of additional shares that would then share in the Company’s net income. During the six months ended June 30, 2021, the denominator of
diluted earnings per common share calculation includes the incremental shares assumed issued under the treasury stock method weighted for the period the shares were outstanding with respect to warrants outstanding as of June 30, 2021. During
the six months ended June 30, 2020, securities that could potentially dilute basic loss per share that were excluded from the computation of diluted loss per
share, because to do so would have been antidilutive for the period presented, were the incremental shares in connection with the unexercised, as of June 30, 2020, Class A warrants, calculated in accordance with the treasury stock method.
The components of the
calculation of basic and diluted earnings/(loss) per common share in each of the periods comprising the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss) are as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Net (loss)/ income and comprehensive (loss)/income
$
(404,468
)
$
7,602,568
Less: Cumulative dividends on Series A Preferred Shares
—
—
Net (loss)/income and comprehensive (loss)/ income available to common shareholders
(404,468
)
7,602,568
Weighted average number of common shares outstanding, basic
802,765
73,384,422
Plus: Dilutive effect of warrants
—
2,818,587
Weighted average number of common shares outstanding, diluted
802,765
76,203,009
(Loss)/Earnings per common share, basic and diluted
The following table includes the voyage
revenues earned by the Company from time charters, voyage charters and pool agreements for the six month periods ended June 30, 2020 and 2021, as presented in the accompanying unaudited interim condensed consolidated statements of comprehensive
income/(loss):
Six
months ended
June 30,
Six
months ended
June 30,
2020
2021
Time charter revenues
5,310,936
27,635,487
Voyage charter revenues
—
693,471
Pool revenues
—
433,678
Total Vessel revenues
$
5,310,936
$
28,762,636
As of June 30, 2021,
trade accounts receivable, net increased by $1,496,824 and deferred revenue increased by $1,564,978 compared to December 31, 2020. These changes were mainly attributable to the timing of collections and the timing of commencement of revenue recognition, theincrease in charter rates and the increase in vessel revenues resultant to the growth of the Company’s fleet during the six
months ended June 30, 2021. As of June 30, 2021, the Company had no deferred revenue related to undelivered performance obligations under any of its voyages in progress.
Further, as of June 30,
2021, deferred assets related to revenue contracts presented under “Deferred charges, net” amounted to $142,898 compared to $0 as of December 31, 2020 and will be expensed during the third quarter of 2021. This change was mainly attributable to the timing of commencement of
revenue recognition.
The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.
The amounts in the accompanying unaudited
interim condensed consolidated statements of comprehensive income/(loss) are analyzed as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Audit fees
$
48,640
$
144,624
Chief Executive and Chief Financial Officer and directors' compensation
16,000
24,000
Other professional fees
172,996
690,731
Administration fees-related party (Note 3(c))
—
600,000
Total
$
237,636
$
1,459,355
The Chief Executive Officer and Chief Financial Officer compensation was terminated on October 1, 2020 and, subsequent to this date, all services rendered
by the Company’s Chief Executive Officer and Chief Financial Officer are included in its Master Agreement with Castor Ships (see Note 3(c)).
The entire disclosure for the components of non-operating income or non-operating expense, including, but not limited to, amounts earned from dividends, interest on securities, gain (loss) on securities sold, equity earnings of unconsolidated affiliates, gain (loss) on sales of business, interest expense and other miscellaneous income or expense items.
(a)Entry into $40.75 Million Debt Financing: On July 23, 2021, the Company, through four of its ship-owning subsidiaries, entered into a $40.75 million senior secured term loan facility with Hamburg Commercial Bank AG (the “$40.75
Million Hamburg Facility”). The $40.75 Million Hamburg Facility was drawn in full on July 27, 2021. The facility has a tenor of five years from the drawdown date, bears interest plus LIBOR per annum, and is secured by first mortgages on the M/V Magic Thunder, M/V Magic Nebula, M/V Magic Eclipse and the M/V Magic Twilight.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
The
accompanying unaudited interim condensed consolidated financial statements include the accounts of Castor and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and applicable rules and regulations of the
U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. These statements and the accompanying
notes should be read in conjunction with the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2020, filed with the SEC on March 30, 2021 (the “2020 Annual Report”).
These
unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments
considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. Operating results for the six-month period ended June 30, 2021 are not necessarily indicative of the
results that might be expected for the fiscal year ending December 31, 2021.
Disclosure of accounting policy for basis of accounting, or basis of presentation, used to prepare the financial statements (for example, US Generally Accepted Accounting Principles, Other Comprehensive Basis of Accounting, IFRS).
The Company reports financial information and evaluates its operations by charter revenues and not by the length, type of vessel or type of ship employment for its customers,
i.e. time or voyage charters. The Company does not use discrete financial information to evaluate the operating results for each such type of charter or vessel. Although revenue can be identified for these types of charters or vessels, management
cannot and does not identify expenses, profitability or other financial information for these various types of charters or vessels. As a result, management, including the chief operating decision
maker, reviews operating results solely by revenue per day and operating results of the fleet, and thus the Company has determined that it operates as one
reportable segment. Furthermore, when the Company charters a vessel to a charterer, the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographic information is impracticable.
There are no recent accounting pronouncements the adoption of which are expected to have a material effect on the Company’s unaudited interim consolidated
condensed financial statements in the current period.
Disclosure of accounting policy pertaining to new accounting pronouncements that may impact the entity's financial reporting. Includes, but is not limited to, quantification of the expected or actual impact.
During the six month
periods ended June 30, 2020 and 2021, the Company incurred the following charges in connection with related party transactions, which are included in the accompanying unaudited interim condensed consolidated statements of comprehensive income/
(loss):
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Management fees-related parties
Management fees – Pavimar (a)
$
273,000
$
1,782,000
Management fees – Castor Ships (c)
—
742,500
Included in Voyage expenses
Charter hire commissions – Castor Ships (c)
$
—
$
364,540
Included in Interest and finance costs
Interest expenses (b) – Thalassa
$
151,667
$
150,833
Included in General and administrative expenses
Administration fees – Castor Ships (c)
$
—
$
600,000
Included in Vessels’ cost
Sale & purchase commission – Castor Ships (c)
$
—
$
2,426,800
As of December 31, 2020
and June 30, 2021, balances with related parties consisted of the following:
December 31, 2020
June 30, 2021
Assets:
Working capital advances granted to Pavimar (a) – current
$
1,559,132
$
1,831,311
Working capital advances granted to Pavimar (a) – non-current
—
1,104,394
Liabilities:
Related party debt (b) – Thalassa
$
5,000,000
$
5,000,000
Accrued loan interest (b) – Thalassa
405,000
555,833
Voyage commissions & management fees due to Castor Ships (c)
Tabular disclosure of related party transactions. Examples of related party transactions include, but are not limited to, transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners and (d) affiliates.
Tabular disclosure of the amounts paid in advance for capitalized costs that will be expensed with the passage of time or the occurrence of a triggering event, and will be charged against earnings within one year or the normal operating cycle, if longer; the aggregate carrying amount of current assets, not separately presented elsewhere in the balance sheet; and other deferred costs.
Tabular disclosure of physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, balances by class of assets, depreciation and depletion expense and method used, including composite depreciation, and accumulated deprecation.
The amount of long-term debt (including related party debt discussed under Note 3) shown in the accompanying unaudited interim consolidated balance sheet of June 30, 2021, is analyzed as follows:
Year/Period Ended
Loan facilities
Borrowers- Issuers
December 31,
2020
June 30,
2021
$11.0 Million Term Loan Facility (a)
Spetses- Pikachu
$
9,400,000
$
8,600,000
$4.5 Million Term Loan Facility (b)
Bistro
4,050,000
3,750,000
$15.3 Million Term Loan Facility (c)
Pocahontas- Jumaru
—
14,819,000
$18.0
Million Term Loan Facility (d)
Rocket- Gamora
—
18,000,000
Total long-term debt
$
13,450,000
$
45,169,000
Less: Deferred financing costs
(264,134
)
(894,951
)
Total long-term debt, net of deferred finance costs
$
13,185,866
44,274,049
Presented:
Current portion of long-term debt
$
2,200,000
$
7,484,000
Less: Current portion of deferred finance costs
(97,963
)
(330,590
)
Current portion of long-term debt, net of deferred finance costs
$
2,102,037
$
7,153,410
Non-Current portion of long-term debt
11,250,000
37,685,000
Less: Non-Current portion of deferred finance costs
(166,171
)
(564,361
)
Non-Current portion of long-term debt, net of deferred finance costs
The annual principal payments for the Company’s outstanding debt arrangements as of June 30, 2021 (including related party debt
discussed under Note 3), required to be made after the balance sheet date, are as follows:
Twelve-month period ending June 30,
Amount
2022
$
12,484,000
2023
6,784,000
2024
6,784,000
2025
24,117,000
Total long-term debt (including related party debt)
Tabular disclosure of information pertaining to short-term and long-debt instruments or arrangements, including but not limited to identification of terms, features, collateral requirements and other information necessary to a fair presentation.
The
following table sets forth the Company’s future minimum contracted lease payments (gross of charterers’ commissions), based on vessels’ commitments to non-cancelable fixed time charter contracts as of June 30, 2021. The
calculation does not include any assumed off-hire days.
The components of the
calculation of basic and diluted earnings/(loss) per common share in each of the periods comprising the accompanying unaudited interim condensed consolidated statements of comprehensive income/(loss) are as follows:
Six months ended
June 30,
Six months ended
June 30,
2020
2021
Net (loss)/ income and comprehensive (loss)/income
$
(404,468
)
$
7,602,568
Less: Cumulative dividends on Series A Preferred Shares
—
—
Net (loss)/income and comprehensive (loss)/ income available to common shareholders
(404,468
)
7,602,568
Weighted average number of common shares outstanding, basic
802,765
73,384,422
Plus: Dilutive effect of warrants
—
2,818,587
Weighted average number of common shares outstanding, diluted
802,765
76,203,009
(Loss)/Earnings per common share, basic and diluted
Tabular disclosure of an entity's basic and diluted earnings per share calculations, including a reconciliation of numerators and denominators of the basic and diluted per-share computations for income from continuing operations.
The following table includes the voyage
revenues earned by the Company from time charters, voyage charters and pool agreements for the six month periods ended June 30, 2020 and 2021, as presented in the accompanying unaudited interim condensed consolidated statements of comprehensive
income/(loss):
Tabular disclosure of disaggregation of revenue into categories depicting how nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factor.
Tabular disclosure of the components of non-operating income or non-operating expense that may include amounts earned from dividends, interest on securities, gains (losses) on securities sold, equity earnings of unconsolidated affiliates, net gain (loss) on sales of business, interest expense and other miscellaneous income or expense items.
Number of segments reported by the entity. A reportable segment is a component of an entity for which there is an accounting requirement to report separate financial information on that component in the entity's financial statements.
Amount of interest payable on debt due to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Fees paid to related parties for providing a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Amount for accounts payable to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
The aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due within one year (or one business cycle).
Aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due after one year (or one business cycle).
Amount of selling, general and administrative expenses resulting from transactions, excluding transactions that are eliminated in consolidated or combined financial statements, with related party.
Fixed daily fee charged by a related party to provide a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Fees paid to related parties for providing a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Term of related party agreement renewal, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
Multiplier applied to the total amount of the daily management fee calculated on an annual basis to determine the termination fee under the shipmanagement agreements.
Term of related party agreement, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
The aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due within one year (or one business cycle).
Aggregate amount of receivables to be collected from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth, at the financial statement date. which are usually due after one year (or one business cycle).
The cash outflow for the payment of a long-term borrowing made from a related party where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth. Alternate caption: Payments for Advances from Affiliates.
The percentage of the gross charter hire, freight and the ballast bonus earned under a charter charged as a commission to the Company by a related party.
Fixed daily fee charged by a related party to provide a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Fees paid to related parties for providing a wide range of shipping services such as crew management, technical management, operational employment management, insurance arrangements, provisioning, bunkering, accounting services, general administration and audit support.
Termination fee multiplier applied to the total amount of the flat management fee and the per vessel management fee calculated on an annual basis under an agreement with a related party.
Term of related party agreement renewal, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
Term of related party agreement, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
Amount of selling, general and administrative expenses resulting from transactions, excluding transactions that are eliminated in consolidated or combined financial statements, with related party.
Amount, after accumulated amortization and accumulated impairment loss, of asset recognized from cost incurred to obtain or fulfill contract with customer; classified as noncurrent.
Amount of accumulated depreciation, depletion and amortization for physical assets used in the normal conduct of business to produce goods and services.
The amount of expense recognized in the current period that reflects the allocation of the cost of tangible assets over the assets' useful lives. Includes production and non-production related depreciation.
Amount of acquisition of long-lived, physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, furniture and fixtures, and computer equipment.
Amount before accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.
Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.
Amount of increase (decrease) of physical assets used in the normal conduct of business and not intended for resale, from reclassification, impairment, donation, or changes classified as other. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.
The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets.
Amount of acquisition of long-lived, physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, furniture and fixtures, and computer equipment.
Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.
Amount, before unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but is not limited to, notes payable, bonds payable, commercial loans, mortgage loans, convertible debt, subordinated debt and other types of debt.
Amount, after accumulated amortization, of debt issuance costs classified as current. Includes, but is not limited to, legal, accounting, underwriting, printing, and registration costs.
Amount, after accumulated amortization, of debt issuance costs. Includes, but is not limited to, legal, accounting, underwriting, printing, and registration costs.
Amount, after accumulated amortization, of debt issuance costs classified as noncurrent. Includes, but is not limited to, legal, accounting, underwriting, printing, and registration costs.
Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.
The amount for notes payable (written promise to pay), due to related parties. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).
Carrying value as of the balance sheet date of the portion of long-term, collateralized debt obligations due within one year or the operating cycle, if longer. Such obligations include mortgage loans, chattel loans, and any other borrowings secured by assets of the borrower.
Carrying amount of collateralized debt obligations with maturities initially due after one year or beyond the operating cycle, if longer, excluding the current portion. Obligations include, but not limited to, mortgage loans, chattel loans, and other borrowings secured by assets.
Period of time between issuance and maturity of debt instrument, in PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents the reported fact of one year, five months, and thirteen days.
Amount, before unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but is not limited to, notes payable, bonds payable, commercial loans, mortgage loans, convertible debt, subordinated debt and other types of debt.
Amount of long-term debt payable, sinking fund requirement, and other securities issued that are redeemable by holder at fixed or determinable price and date, maturing in next fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Amount of long-term debt payable, sinking fund requirement, and other securities issued that are redeemable by holder at fixed or determinable price and date, maturing in fourth fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Amount of long-term debt payable, sinking fund requirement, and other securities issued that are redeemable by holder at fixed or determinable price and date, maturing in third fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Amount of long-term debt payable, sinking fund requirement, and other securities issued that are redeemable by holder at fixed or determinable price and date, maturing in second fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Amount of cash restricted as to withdrawal or usage, classified as noncurrent. Cash includes, but is not limited to, currency on hand, demand deposits with banks or financial institutions, and other accounts with general characteristics of demand deposits.
The maximum number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) permitted to be issued by an entity's charter and bylaws.
Number of securities into which the class of warrant or right may be converted. For example, but not limited to, 500,000 warrants may be converted into 1,000,000 shares.
Value of outstanding derivative securities that permit the holder the right to purchase securities (usually equity) from the issuer at a specified price.
Value of input used to measure outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur.
Period between issuance and expiration of outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
Number of securities into which the class of warrant or right may be converted. For example, but not limited to, 500,000 warrants may be converted into 1,000,000 shares.
Value of outstanding derivative securities that permit the holder the right to purchase securities (usually equity) from the issuer at a specified price.
Value of input used to measure outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur.
Period between issuance and expiration of outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
Number of securities into which the class of warrant or right may be converted. For example, but not limited to, 500,000 warrants may be converted into 1,000,000 shares.
Value of outstanding derivative securities that permit the holder the right to purchase securities (usually equity) from the issuer at a specified price.
Value of input used to measure outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur.
Period between issuance and expiration of outstanding warrant and right embodying unconditional obligation requiring redemption by transferring asset at specified or determinable date or upon event certain to occur, in 'PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents reported fact of one year, five months, and thirteen days.
The period of time that the Company can sell shares from under an at-the-market (ATM) continuous equity offering program in PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents the reported fact of one year, five months, and thirteen days.
Equity Capital Structure, Issuance of common Stock in Connection with Class A Warrants and July 2020 Equity Offering Warrants (Details) - Class A Warrants [Member] $ in Millions
Amount of contractual obligation to be paid in next fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Amount of lease payment to be received by lessor for operating lease in next fiscal year following current fiscal year. Excludes interim and annual periods when interim periods are reported from current statement of financial position date (rolling approach).
Minimum amount to be expended to satisfy the terms of arrangements in which the entity has agreed to expend funds to procure goods or services, excluding long-term purchase commitments or unconditional purchase obligations.
Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.
The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.
Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities; of income (loss) available to common shareholders.
The average number of shares or units issued and outstanding that are used in calculating diluted EPS or earnings per unit (EPU), determined based on the timing of issuance of shares or units in the period.
Number of [basic] shares or units, after adjustment for contingently issuable shares or units and other shares or units not deemed outstanding, determined by relating the portion of time within a reporting period that common shares or units have been outstanding to the total time in that period.
Amount, after accumulated amortization and accumulated impairment loss, of asset recognized from cost incurred to obtain or fulfill contract with customer; classified as current.
The increase (decrease) during the reporting period in amount due within one year (or one business cycle) from customers for the credit sale of goods and services.
Amount of increase (decrease) in deferred income and obligation to transfer product and service to customer for which consideration has been received or is receivable.
Amount of operating lease income from lease payments and variable lease payments paid and payable to lessor. Includes, but is not limited to, variable lease payments not included in measurement of lease receivable.
The amount of loss (gain) on bunker fuel during the period. The gain or loss is the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer.
Voyage expenses consist of: (a) port, canal and bunker expenses that are unique to a particular charter which are paid for by the charterer under the time charter arrangements or by the Company under voyage charter arrangements, and (b) brokerage commissions, which are always paid for by the Company, regardless of charter type.
The expense in the period incurred with respect to protection provided by insurance entities against risks other than risks associated with production (which are allocated to cost of sales).
Generally recurring costs associated with normal operations except for the portion of these expenses which can be clearly related to production and included in cost of sales or services. Excludes Selling, General and Administrative Expense.
All taxes not related to income of the entity or excise or sales taxes levied on the revenue of the entity that are not reported elsewhere. These taxes could include production, real estate, personal property, and pump tax.
Amount of fees paid to an independent registered public accounting firm for professional services rendered for the audit of the consolidated financial statements and any other audit services required for the SEC or other regulatory filings.
The aggregate total of expenses of managing and administering the affairs of an entity, including affiliates of the reporting entity, which are not directly or indirectly associated with the manufacture, sale or creation of a product or product line.
Amount of expense for salary and wage arising from service rendered by officer. Excludes allocated cost, labor-related nonsalary expense, and direct and overhead labor cost included in cost of good and service sold.
Amount of selling, general and administrative expenses resulting from transactions, excluding transactions that are eliminated in consolidated or combined financial statements, with related party.
The amount of amortization and write-off of beneficial conversion feature resulting from the recognition of convertible debt instruments as two separate components - a debt component and an equity component.
Amount of amortization expense attributable to debt issuance costs and write-off of amounts previously capitalized as debt issuance cost in an extinguishment of debt.
Interest paid other than in cash for example by issuing additional debt securities. As a noncash item, it is added to net income when calculating cash provided by or used in operations using the indirect method.
Period of time between issuance and maturity of debt instrument, in PnYnMnDTnHnMnS' format, for example, 'P1Y5M13D' represents the reported fact of one year, five months, and thirteen days.