Start Time: 10:00

End Time: 10:17

Paragon Shipping, Inc. (PRGN)

Q4 2012 Earnings Conference Call

February 19, 2013 10:00 a.m.ET

Executives

Rudy Barrio – Investor Relations

Michael Bodouroglou – Chairman, President & CEO

Robert Perry – CFO

Analyst

Natasha Boyden – Global Hunter

Presentation

Operator

Good day and welcome to the Paragon Shipping Fourth Quarter and Year End Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions). After today’s presentation there will be an opportunity to ask questions. (Operator Instructions). Please note this event is being recorded.

And now I’d like to turn the conference over to Rudy Barrio of Allen & Caron Investor Relations. Please go ahead.

Rudy Barrio

Thank you, Emily. Good day, everyone and welcome to Paragon Shipping’s investor conference call to discuss its financial results for the fourth quarter and year ended December 31, 2012. With us from management today is Michael Bodouroglou, Chairman, President, Chief Executive Officer and Robert Perry, Chief Financial Officer.

Before we start today’s call, there are a couple of items I would like to cover. Many of you received a copy of Paragon Shipping’s earnings results press release, it was disseminated earlier today. If you did not receive a copy of the press release, it is posted on Paragon Shipping’s website at www.paragonship.com and in then the Investor Relations section of our website at www.allencaron.com. It is also posted on Yahoo! Finance and most financial sites. You may also call our office in New York at 212-691-8087 and we will email it to you.

As mentioned earlier, this call is being recorded. A replay will be available shortly after the call for seven days and maybe accessed from North America by calling 877-344-7529 and entering passcode 10025328. International callers should dial 412-317-0088. This call is also being broadcast live over the internet and maybe accessed via Paragon Shipping’s website. A replay of the webcast will be available shortly after the call and will continue for seven days.

Further, we would like to remind everyone of the Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. Some of the statements made during this call may contain forward-looking statements. The company’s actual results may differ materially from such statements. We advise you to read the cautionary note regarding forward-looking statements in Paragon’s recent earnings release and in the Risk Factors section of the company’s most recent filings with the Securities and Exchange Commission, all of which are available at www.sec.gov.

I would now like to turn the call over to Robert Perry. Good day, Robert.

Robert Perry

Good day Rudy, thank you. Good morning ladies and gentlemen. Today, I will briefly give you the financial highlights from the quarter followed by an update on the latest company developments as well as our views on the drybulk industry. I will then present a more detailed overview of our fourth quarter and year end December 31, 2012 financial results before ending with our closing remarks. Joining me on the call today is our Chairman, President and CEO, Michael Bodouroglou. We will be available for questions after the end of the presentation.

Please turn to slide number four. During the fourth quarter of 2012, we operated an average of 12 vessels at a time charter equivalent rate of $10,563 per day which equated to net revenues of $12.9 million, EBITDA of $6.9 million and net income of $0.3 million or $0.05 per share.

For the year ended December 31, 2012 we operated an average of 11.2 vessels at a time charter equivalent rate of $11,923 per day which equaled to net revenues of $50.3 million, EBITDA of $7.6 million and net loss of $17.6 million or $2.84 per share. After adjusting for non-cash items, that we will discuss in more detail later in this presentation, our EBITDA for the year was $24.2 million, while our net loss was $1 million or $0.16 per share.

On slide five, as per our financing update, we are to announce that we have successfully completed our debt restructuring. More specifically, we finalized the documentation for amending our loan agreements with all of our lenders, which coupled with the $10 million equity raise through our CEO’s private placement that was announced on December 24, we successfully fulfilled all of the conditions precedence in our amendment store loan agreements.

To summarize, what we achieved through this debt restructuring, let me highlight that we obtained waivers and agreed to the relaxation of several of our financial and security covered ratio covenants, the deferral of a portion of our scheduled quarterly installments, and in the case of the loan agreements with Bank of Ireland and Bank of Scotland, the extension of our loan agreement to the second quarter of 2017 and the third quarter of 2015 respectively.

In addition, we extended the availability period of our Nordea facility for nine months securing the financing of whole number 625, our latest entity new building vessel that is expected to be delivered in the fourth quarter of 2013.

In respect to the loan agreement with Bank of Scotland which was a syndicated facility, we agreed to the prepayment of $2.8 million in return for the full and final settlement of $4.7 million in debt, representing the portion of the loans to one of the syndicate members. This resulted in a gain of $1.9 million from debt extinguishment that was recorded in the fourth quarter of 2012.

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