SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form 6-K
Report
of Foreign Issuer
Pursuant
to Rule 13a-16 or 15d-16 of
the
Securities Exchange Act of 1934
For
the month of May 2007
DOUBLE
HULL TANKERS, INC.
(Exact
name of Registrant as specified in its charter)
26
New
Street
St.
Helier, Jersey JE23A
Channel
Islands
(Address
of principal executive offices)
(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
þ Form 40-F
o
(Indicate
by check mark whether by furnishing the information contained in this Form,
the
Registrant is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2 (b) under the Securities Exchange Act of 1934.)
Yes
o
No þ
(If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2 (b))
Attached
as Exhibit 99.1 is the press release issued by
Double Hull Tankers, Inc. on May 11, 2007 related to first quarter 2007 results.
|
|
|
|
|
Exhibit
|
|
Description
|
|
99.1
|
|
Press
Release dated May 11, 2007 of Double Hull Tankers, Inc.
|
|
|
|
|
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.
| Double Hull Tankers, Inc. | ||
| (Registrant) | ||
| |
|
|
| Date: May 11, 2007 | By: | /s/ Eirik Ubøe |
| Eirik Ubøe | ||
| Chief Financial Officer | ||
Double
Hull Tankers, Inc. Reports First Quarter 2007 Results
ST.
HELIER, JERSEY, CHANNEL ISLANDS, MAY 11, 2007 – Double Hull Tankers, Inc.
(NYSE:DHT) today announced results for the period from January 1 to March
31,
2007. Total revenues for this period were $20.2 million and net income was
$7.2
million, or $0.24 per share (diluted). The Board of Directors of DHT has
declared a dividend of $0.38 per share, which will be paid on June 12, 2007
to
shareholders of record as of the close of business on May 29, 2007. DHT plans
to
host a conference call at 9 am ET on May 11, 2007 to discuss the results
for the
quarter. See below for further details.
First
Quarter 2007 Results
Total
revenues for the first quarter of $20.2 million ($24.2 million in the first
quarter 2006) consist of $17.1 million in base charter hire revenue and $3.1
million in additional hire under the company’s profit sharing arrangements with
Overseas Shipholding Group Inc. ("OSG"). Of the additional hire, $1.5 million
relates to the VLCCs and $1.6 million relates to the Aframax vessels. In
the
quarter ended March 31, 2007, DHT’s VLCCs achieved average time charter
equivalent (TCE) earnings in the commercial pool of $46,700 per day (compared
to
$75,800 in the first quarter of 2006 and $52,900 in the fourth quarter of
2006)
and the Aframax tankers achieved $38,300 per day (compared to $39,700 in
the first quarter of 2006 and $34,100 in the fourth quarter of
2006), according to data from the commercial pools. Approximately 25%
of the revenue days in the Aframax International pool in the first quarter
relate to vessels time chartered out by the pool at an average rate of
about $29,000 per day. In general, through the profit sharing agreements,
DHT
earns 40% of the excess of the vessels’ actual net TCE earnings in the
commercial pools over the base charter hire rates for the quarter, calculated
on
a fleet wide basis and on a four quarter rolling average. The actual average
TCE
earnings that DHT received for its vessels during the quarter ended March
31,
2007, were $42,400 per day for the VLCCs (compared to $52,600 in the first
quarter of 2006 and $46,100 in the fourth quarter of 2006) and $26,100 per
day
for the Aframax vessels (compared to $28,700 in the first quarter of 2006
and $26,200 in the fourth quarter of 2006).
Actual
average TCE earnings are calculated by dividing the total revenue actually
earned by the vessels by the sum of the total days each vessel was on hire
during the period, or “revenue days”. In the quarter ended March 31,
2007, the vessels’ revenue days were 260 (compared to 267 days in the first
quarter 2006) for the VLCCs and 353 (compared to 352 days in the first quarter
2006) for the Aframax vessels.
2
For
the
quarter ended March 31, 2007, DHT’s vessel expenses, including insurance costs,
were $4.8 million, depreciation and amortization expenses were $4.2 million
and
general and administrative expenses were $0.8 million.
For
the
quarter ended March 31, 2007, net finance expenses, including amortization
of
deferred debt issuance costs, were $3.3 million. DHT has entered into an
interest rate swap agreement for the full amount of its term loan of $236
million, effectively fixing the interest rate at 5.6% until October 18, 2010.
The term loan is non-amortizing until January 18, 2011.
Market
Update
China’s
continued strong demand for oil imports, the multi-sourcing of supplies,
Venezuela’s desire to export less oil to the United States and the current
reduction in Mexico’s oil production, all result in longer transportation
distances and increase in the ton/mile transportation demand. The oil
companies’ increasing preference for double hull tankers continue to lead to a
reduction in the trading efficiency for the tanker fleet, a situation that
bodes
well for DHT’s current fleet of double hull tankers.
Market
charter rates for VLCCs and Aframax tankers were not as strong as anticipated
in
January and February. However, rates improved in March and remain strong.
For
the quarter ended March 31, 2007, charter rates were above the base charter
hire
rates of DHT’s charter arrangements with OSG, both for the VLCCs and the Aframax
tankers. The market conditions in this quarter can be attributed to several
factors, including seasonal volatility, a cut back by OPEC of current production
resulting in reduced export from the Middle East and lower non –OPEC
production. On the other hand, Russian tax changes encouraging
increased export of crude, port congestions and strikes have helped to hold
the
charter rates for tankers up.
Vessels’
Charter Arrangements and Vessel Operations
Our
current fleet of seven vessels have been time chartered to OSG from October
2005
for periods of 5-6 ½ years. We believe that the base hire component of each of
our time charters will provide us with stable cash flows during market
downturns, as our charters provide for fixed monthly base hire payments
regardless of prevailing market rates so long as the vessel is not off hire.
If
market rates exceed the daily base hire rates set forth in our charters,
we have
the opportunity to participate in any such excess under the profit sharing
component of our charter arrangements.
All
our
vessels are subject to scheduled periodic dry docking for the purpose of
special
survey and other interim inspections. Additionally, our vessels can be subject
to unscheduled off hire for ongoing maintenance purposes.
The
Overseas Regal, one of our VLCCs, entered drydock in March for the
commencement of a planned special survey. This resulted in 10 days off hire
in
the first quarter. The vessel completed the special survey on April 14. The
14
days off hire in April will be reflected in our second quarter results. The
Overseas Sophie had approximately 4 days off hire in the first quarter
for the completion of a scheduled interim survey and repairs to a generator.
Overseas Ania and Overseas Rebecca had jointly a total of
approximately 3 days off hire in the first quarter due to deslopping and
statutory inspections. These two vessels are scheduled to undergo interim
surveys in the second and third quarter of 2007, respectively, resulting
in an
estimated 3 days off hire per vessel.
3
No
vessel
in our fleet is currently scheduled for drydocking until the docking of one
Aframax at the end of 2008.
Recent
Developments
In
order
to put additional focus on business development, DHT is pleased to announce
that
Tom R. Kjeldsberg has been hired as Senior Vice President for Business
Development. He is joining DHT from DnB NOR Markets, where he was a Director
in
the Corporate Finance division focussing on shipping and offshore.
FINANCIAL
INFORMATION
SUMMARY
CONSOLIDATED STATEMENTS OF OPERATIONS
($
in
thousands except per share amounts)
|
1Q
2007
Jan.
1-March 31, 2007
|
1Q
2006
Jan.
1-March 31, 2006
|
|
|
Shipping
revenues
|
$20,231
|
$24,198
|
|
Vessel
expenses
|
4,775
|
4,496
|
|
Depreciation
and amortization
|
4,171
|
4,171
|
|
General
and administrative
|
807
|
604
|
|
Total
operating expenses
|
9,753
|
9,271
|
|
Income
from vessel operations
|
10,478
|
14,927
|
|
Interest
income
|
220
|
196
|
|
Interest
expense and amortization of deferred debt issuance cost
|
3,492
|
3,468
|
|
Net
income
|
7,206
|
11,655
|
|
Basic
net income per share
|
$0.24
|
$0.39
|
|
Diluted
net income per share
|
$0.24
|
$0.39
|
|
Weighted
average shares (basic)
|
30,013,954
|
30,006,250
|
|
Weighted
average shares (diluted)
|
30,027,438
|
30,013,806
|
SUMMARY
CONSOLIDATED BALANCE SHEETS
($
in
thousands)
|
March
31, 2007
|
Dec.
31, 2006
|
|
|
Current
Assets
|
||
|
Cash
and Cash Equivalents
|
$16,635
|
$17,680
|
|
Voyage
receivables from OSG
|
3,163
|
4,009
|
|
Unrealized
gain on interest rate swap
|
525
|
1,712
|
|
Prepaid
Expenses
|
631
|
331
|
|
Prepaid
Technical Management Fee to OSG
|
1,281
|
1,324
|
|
Total
Current Assets
|
22,235
|
25,056
|
|
Vessels,
net*
|
318,406
|
322,577
|
|
Other
assets incl. deferred debt issuance cost
|
1,367
|
1,407
|
|
Total
Assets
|
$342,008
|
$349,040
|
|
Current
Liabilities
|
||
|
Accounts
payable and accrued expenses
|
$3,736
|
$3,456
|
|
Unrealized
loss on interest rate swap
|
-
|
-
|
|
Deferred
Shipping Revenues
|
5,970
|
6,169
|
|
Total
Current liabilities
|
9,706
|
9,625
|
|
Long
term debt
|
236,000
|
236,000
|
|
Total
Stockholders equity*
|
96,302
|
103,415
|
|
Total
Liabilities and Stockholders' Equity
|
$342,008
|
$349,040
|
*In
October 2005, DHT acquired the 7 vessels in its fleet for a total purchase
price
of $580.6 million from OSG. DHT was required to carry over OSG’s historical book
values of the vessels to its books, and the excess of the aggregate purchase
price above their historical book value was recorded as a reduction of
stockholders’ equity. This reduction amounted to $233 million and represents a
deemed dividend to OSG.
EARNINGS
CONFERENCE CALL INFORMATION
DHT
plans
to host a conference call at 9 am ET on May 11, 2007 to discuss the results
for
the quarter. All shareholders and other interested parties are invited to
call
into the conference call, which may be accessed by calling (800) 561-2718
within
the United States and +1-617-614-3525 for international calls. The passcode
is
“Double Hull”. A live webcast of the conference call will be available in the
Investor Relations section on DHT's website at
http://www.dhtankers.com.
An
audio
replay of the conference call will be available from 11:00 a.m. ET on May
11,
2007 through midnight ET on May 18, 2007 by calling toll free (888) 286-8010
within the United States or +1-617-801-6888 for international callers. The
passcode for the replay is 68307998. A webcast of the replay will be available
in the Investor Relations section on DHT's website at
http://www.dhtankers.com.
Forward
Looking Statements
This
press release contains assumptions, expectations, projections, intentions
and
beliefs about future events, in particular regarding daily charter rates,
vessel
utilization, the future number of newbuildings, oil prices and seasonal
fluctuations in vessel supply and demand. When used in this document,
words such as “believe,” “intend,” “anticipate,” “estimate,” “project,”
“forecast,” “plan,” “potential,” “will,” “may,” “should,” and “expect” and
similar expressions are intended to identify forward-looking statements but
are
not the exclusive means of identifying such statements. These statements
are
intended as “forward-looking statements.” All statements in this
document that are not statements of historical fact are forward-looking
statements.
The
forward-looking statements included in this press release reflect DHT’s current
views with respect to future events and are subject to certain risks,
uncertainties and assumptions. We caution that assumptions,
expectations, projections, intentions and beliefs about future events may
and
often do vary from actual results and the differences can be material. The
reasons for this include the risks, uncertainties and factors described under
the section of our latest annual report on Form 20-F entitled “Risk Factors,” a
copy of which is available on the SEC’s website at www.sec.gov. These
include the risk that DHT may not be able to pay dividends; the highly cyclical
nature of the tanker industry; global demand for oil and oil products; the
number of newbuilding deliveries and the scrapping rate of older vessels;
the
risks associated with acquiring additional vessels; changes in trading patterns
for particular commodities significantly impacting overall tonnage requirements;
risks related to terrorist attacks and international hostilities; expectations
about the availability of insurance; our ability to repay our credit facility
or
obtain additional financing; our ability to find replacement charters for
our
vessels when their current charters expire; compliance costs with environmental
laws and regulations; risks incident to vessel operation, including discharge
of
pollutants; and unanticipated changes in laws and regulations.
Should
one or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
described in the forward-looking statements included in this press release.
DHT
does not intend, and does not assume any obligation, to update these
forward-looking statements.
CONTACT: Eirik
Ubøe
Phone:
+44 1534 639 759 and +47 412 92 712
E-mail:
info@dhtankers.com and
eu@tankersservices.com