6-K 1 f033011drys6k.htm DRYSHIPS INC

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 March 2011


Commission File Number 001-33922


DRYSHIPS INC.


80 Kifissias Avenue

Amaroussion 15125, Athens Greece

(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 [X]       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 as Exhibit 1 is a press release of DryShips Inc. (the “Company”) dated March 30, 2011: DryShips Inc. Reports Financial and Operating Results for the Fourth Quarter 2010.




Exhibit 1



[f033011drys6k001.jpg]



DRYSHIPS INC. REPORTS FINANCIAL AND OPERATING

RESULTS FOR THE FOURTH QUARTER 2010

March 30, 2011, Athens, Greece. DryShips Inc. (NASDAQ: DRYS), or the Company, a global provider of marine transportation services for drybulk and petroleum cargoes, and through its majority owned subsidiary, Ocean Rig UDW Inc., of off-shore contract drilling oil services, today announced its unaudited financial and operating results for the fourth quarter and year ended December 31, 2010.

Fourth quarter 2010 Financial Highlights

Ø

For the fourth quarter of 2010, the Company reported net income of $99.7 million, or $0.31 basic and $0.29 diluted earnings per share. Included in the fourth quarter 2010 results are various items, totaling $16.7 million, or $0.06 per share which are described below. Excluding these items, net income would have amounted to $83.0 million or $0.25 basic and $0.24 diluted earnings per share.  

o

Included in the fourth quarter 2010 results are non-cash amortization of debt issuance costs, including those relating to our convertible senior notes, totaling $10.2 million, or $0.03 per share.

o

Included in the fourth quarter 2010 results are gains incurred on our interest rate swaps, amounting to $26.9 million, or $0.09 per share.

Ø

Basic earnings per share for the fourth quarter of 2010 includes a reduction to net income amounting to $3.8 million relating to the cumulative payment-in-kind dividends on the Series A Convertible Preferred Stock, which reduces the income available to common shareholders.

Ø

The Company reported adjusted EBITDA of $129.3 million for the fourth quarter of 2010.1


George Economou, Chairman and Chief Executive Officer of the Company commented:

 

“We are pleased to report another solid quarter of operating results and the successful achievement of a number of milestones that were initiated over the last two years. Most of these positive developments stem from the offshore drilling segment as we have successfully concluded two vital financings. The restructuring of the Deutsche Bank led facility for newbuilding drillship Ocean Rig Poseidon allows for immediate drawdown and signifies the support of our bankers and the benefits of our commercial decision to charter the Ocean Rig Poseidon to Petrobras. We were also able to achieve competitive financing terms in a challenging market with the new $800 million facility led by Nordea and ABN-AMRO. Giving effect to the drawdown of these two facilities along with cash on hand we will have secured financing for all of our four drillships while the Ocean Rig Mykonos facility also remains available for drawdown. We are now focused on taking delivery of the remaining drillships and ensuring drilling operations start at the earliest. We remain committed to registering the Ocean Rig shares on an exchange at the earliest and to build Ocean Rig into a competitive player in the ultra deepwater sector.  


We are pleased with our decision to make a counter cyclical investment and seize the opportunity to purchase a high specification fleet of sister tankers from a top quality yard. The tanker market has again proved to be as unpredictable as ever due to the fallout of the Libyan conflict. The short term impact has been an increase in tonne-mile demand as longer-haul sources replace Libyan oil in Europe. We remain committed to placing the Company’s tanker interests in a standalone entity at the right time.


As we move through 2011, we are seeing increasingly attractive opportunities to purchase drybulk carriers and renew and/or grow our fleet. Our strategy remains opportunistic in this sector.”



Financial Review: 2010 Fourth quarter

The Company recorded net income of $99.7 million, or $0.31 basic and $0.29 diluted earnings per share, for the three-month period ended December 31, 2010, as compared to a net income of $9.6 million, or $0.02 basic and diluted earnings per share, for the three-month period ended December 31, 2009. Adjusted EBITDA, which is defined and reconciled to net income later in this press release, was $129.3 million for the fourth quarter of 2010 as compared to $76.7 million for the same period in 2009.

Included in the fourth quarter 2010 results are various items totaling $16.7 million, or $0.06 per share, which are described at the beginning of this press release. Excluding these items, our adjusted net income would have amounted to $83.0 million, or $0.25 per share.

Basic earnings per share for the fourth quarter of 2010 includes a reduction to net income amounting to $3.8 million relating to the cumulative payment-in-kind dividends on the Series A Convertible Preferred Stock, which reduces the income available to common shareholders.

For the drybulk carrier segment, net voyage revenues (voyage revenues minus voyage expenses) decreased by $5.3 million to $106.7 million for the three-month period ended December 31, 2010, as compared to $112.0 million for the three-month period ended December 31, 2009. For the offshore drilling segment, revenues from drilling contracts increased by $25.2 million to $102.3 million for the three-month period ended December 31, 2010 as compared to $77.1 million for the same period in 2009.

Total vessel and rig operating expenses increased by $6.5 million to $52.0 million for the three-month period ended December 31, 2010, as compared to $45.5 million for the three-month period ended December 31, 2009, while total depreciation and amortization decreased by $3.2 million to $46.9 million for the three-month period ended December 31, 2010 as compared to $50.1 million for the three-month period ended December 31, 2009. Total general and administrative expenses increased to $25.2 million in the fourth quarter of 2010 from $24.5 million during the comparative period in 2009.





Financing Developments


New $800 million Syndicated Secured Term Loan Facility

On March 25, 2011, the Company received signed commitments from all the lenders participating in a new $800 million syndicated secured term loan facility to partially finance the construction costs of the Ocean Rig Corcovado and Olympia. This facility has a 5 year term and 12 year repayment profile, and bears interest at LIBOR plus a margin.

This new facility is subject to completion of definitive documentation, which the Company expects to occur in the coming weeks. The Lead Arrangers are Nordea Bank and ABN AMRO. Also participating in this financing is Garanti-Instituttet for Eksportkreditt (GIEK), Norway’s export credit agency, DVB Bank, Deutsche Bank and National Bank of Greece.

The Company intends to use a portion of the new facility to prepay its $325 million Bridge Loan Facility with Deutsche Bank.

Restructuring of $1.1 billion Secured Term Loan Facility

On March 28, 2011, the Company received signed consents from all participating lenders to restructure the $1.1 billion secured term loan facilities led by Deutsche Bank.

The main terms of the restructuring are as follows:

·

The maximum amount permitted to be drawn is reduced from $562 million to $495 million under each facility.

·

In addition to the Dryships Guarantee, the Company’s majority-owned subsidiary, Ocean Rig UDW Inc., will provide an unlimited recourse guarantee and will be subject to certain financial covenants that will apply quarterly.

·

Full draw downs (up to a total of $495 million) will be permitted for the Ocean Rig Poseidon based upon the fixture of the drillship under its drilling contract with Petrobras, and cash collateral deposited for this vessel will be released.

·

For the Ocean Rig Mykonos, the Company will have up to one month prior to delivery (scheduled for September 2011) to execute an acceptable drilling contract in order to draw down the loan.


This restructuring is subject to completion of definitive documentation, which the Company expects to occur in the coming weeks.

New $70 million Secured Term Loan Facility

On February 7, 2011, the Company executed definitive documentation for a $70 million secured term loan facility with an international lender to partially finance the construction costs of the newbuilding tankers, Saga and Villamoura. This facility has a 5 year term and a 15 year repayment profile, and bears interest at LIBOR plus a margin. As of March 30, 2011, the Company has drawn the full amount available under this facility.

New $32.3 million Secured Term Loan Facility

On March 30, 2011, the Company received a firm commitment from an international lender for a $32.3 million secured term loan facility to partially finance the construction cost of the newbuilding tanker, Daytona, which is scheduled to be delivered in May 2011. This facility has a 6 year term and a 15 year repayment profile, and bears interest at LIBOR plus a margin. This facility is subject to completion of definitive documentation, which the Company expects to occur in the coming weeks.





Selected Recent Developments



·

On November 23, 2010, the Company announced it has entered into an agreement with a major South Korean shipyard for the option to construct up to four ultra deepwater drillships. The new orders would be sisterships of the drillships under construction with further upgrades to the specifications. Each of the four options can be declared within twelve months of the agreement, with deliveries ranging from 2013 until 2014. The total project cost is estimated to be about $600 million per drillship excluding financing costs. The agreement includes a non-refundable slot reservation fee of $24.8million per drillship that will be applied to the drillship contract price if the options are exercised. The option agreement was novated to Ocean Rig UDW in December 2010 at a cost of $99.0 million.


·

In January 2011, the Company entered into firm contracts with Cairn Energy PLC for the Leiv Eiriksson and the Ocean Rig Corcovado, and with Petrobras Tanzania for the Ocean Rig Poseidon.


·

On December 21, 2010, Ocean Rig UDW closed its offering by way of a private placement of shares in the Norwegian market with total gross proceeds of $500 million, with DryShips retaining 78% of Ocean Rig UDW. As noted above, as part of this transaction Ocean Rig UDW acquired at cost the drillship options held by DryShips.


·

On December 23, 2010, the Company entered into direct agreements with a first class Korean shipyard to purchase twelve high specification newbuilding tankers at a total purchase price of $770 million, including over $3 million per vessel in extra items. The delivery installments for these contracts approximate 70% of each vessel’s price.


·

On January 3, 2011, the Company took delivery of its newbuilding drillship Ocean Rig Corcovado (Hull 1837).


·

On January 18, 2011, the Company took delivery of its newbuilding Aframax tanker, Saga.


·

On March 17, 2011, the Company’s vessel, MV OLIVA, was reported to have run aground in a group of islands in the South Atlantic Ocean. Salvors report that there are no salvage prospects for the vessel or the cargo. We expect that all losses will be covered by insurance.


·

On March 23, 2011, the Company took delivery of its newbuilding Suezmax tanker, Vilamoura.


·

On March 30, 2011, the Company took delivery of its second newbuilding drillship Ocean Rig Olympia (Hull 1838).


·

In March 2011, A U.S. District Court in Maryland resolved a case in which Cardiff, the former manager of the Company’s vessel, M/V Capitola, entered into a comprehensive settlement with the U.S. Department of Justice in connection with an investigation into MARPOL violations involving that vessel.  The court applied a fine of approximately $2.5 million and instructed Cardiff to implement an Environmental Compliance Plan, or ECP, which the vessels’ current operator, TMS Bulkers, will carry out.  


·

Three of the Company’s drybulk carriers are chartered to Korea Lines Corporation (KLC). As of February 16, 2011, KLC entered into a rehabilitation proceeding under the protection of the Korean Courts. The Company reached an agreement with the receivers of KLC to restructure the charters at a base rate plus a profit share component. The agreement requires that a certain portion of outstanding hire be paid in full with the remaining amount to be filed as an unsecured claim, the satisfaction of which will be subject to the rehabilitation proceedings in the Korean Bankruptcy Courts.


 

Fleet List

The table below describes our drybulk and tanker fleet profile as of March 29, 2011


 

Year

 

 

Gross rate

Redelivery

 

 

Built

DWT

Type

Per day

Earliest

Latest

 

 

 

 

 

 

 

Dry fleet

 

 

 

 

 

 

 

 

 

 

 

 

 

Capesize:

 

 

 

 

 

 

Alameda

2001

170,662

Capesize

$27,500

Nov-15

Jan-16

Brisbane

1995

151,066

Capesize

$25,000

Dec-11

Apr-12

Capri  

2001

172,579

Capesize

Spot

Apr-18

Jun-18

Flecha

2004

170,012

Capesize

$55,000

Jul-18

Nov-18

Manasota

2004

171,061

Capesize

$67,000

Feb-13

Apr-13

Mystic

2008

170,040

Capesize

$52,310

Aug-18

Dec-18

Samsara

1996

150,393

Capesize

Spot

 

 

 

 

 

 

 

 

 

Panamax:

 

 

 

 

 

 

Amalfi ex. Gemini S

2009

75,000

Panamax

$39,750

Aug- 13

Dec- 13

Avoca

2004

76,629

Panamax

$45,500

Sep-13

Dec-13

Bargara

2002

74,832

Panamax

$43,750

May-12

Jul-12

Capitola  

2001

74,816

Panamax

Spot

Jun-13

Aug-13

Catalina

2005

74,432

Panamax

$40,000

Jun-13

Aug-13

Conquistador

2000

75,607

Panamax

$17,750

Aug-11

Nov-11

Coronado

2000

75,706

Panamax

$18,250

Sep-11

Nov-11

Ecola

2001

73,925

Panamax

$43,500

Jun-12

Aug-12

La Jolla

1997

72,126

Panamax

$14,750

Aug-11

Nov-11

Levanto

2001

73,931

Panamax

$16,800

Sep-11

Nov-11

Ligari

2004

75,583

Panamax

$55,500

Jun-12

Aug-12

Maganari

2001

75,941

Panamax

$14,500

Jul-11

Sep-11

Majorca

2005

74,747

Panamax

$43,750

Jun-12

Aug-12

Marbella

2000

72,561

Panamax

$14,750

Aug-11

Nov-11

Mendocino

2002

76,623

Panamax

$56,500

Jun-12

Sep-12

Ocean Crystal

1999

73,688

Panamax

$15,000

Aug-11

Nov-11

Oregon

2002

74,204

Panamax

$16,350

Aug-11

Oct-11

Padre

2004

73,601

Panamax

$46,500

Sep-12

Dec-12

Positano

2000

73,288

Panamax

$42,500

Sep-13

Dec-13

Primera

1998

72,495

Panamax

$18,250*

Sep-11

Sep-11

Rapallo

2009

75,123

Panamax

$15,400

Aug-11

Oct-11

Redondo

2000

74,716

Panamax

$34,500

Apr-13

Jun-13

Saldanha

2004

75,707

Panamax

$52,500

Jun-12

Sep-12

Samatan

2001

74,823

Panamax

Spot

May-13

Jul-13

Sonoma

2001

74,786

Panamax

$19,300

Sept- 11

Nov- 11

Sorrento

2004

76,633

Panamax

$17,300

Sep-11

Dec-11

Toro

1995

73,035

Panamax

$16,750

May-11

Jul-11

 

 

 

 

 

 

 

Supramax:

 

 

 

 

 

 

Galveston ex. Pachino

2002

51,201

Supramax

Spot

 

 

Paros I

2003

51,201

Supramax

$27,135

Oct-11

May-12

 

 

 

 

 

 

 

 

Year

 

 

 

 

 

 

Built

DWT

Type

 

 

 

Newbuildings

 

 

 

 

 

 


 

 

 

 

 

 

Panamax 1

2011

76,000

Panamax

 

 

 

Panamax 2

2012

76,000

Panamax

 

 

 

 

 

 

 

 

 

 

Tanker fleet

 

 

 

 

 

 

 

 

 

 

 

 

 

Saga

2011

115,200

Aframax

Spot

 

 

Vilamoura

2011

158,300

Suezmax

Spot

 

 

 

 

 

 

 

 

 

Newbuildings

 

 

 

 

 

 

Alicante

2012

115,200

Aframax

 

 

 

Belmar

2011

115,200

Aframax

 

 

 

Calida

 2011

115,200

Aframax

 

 

 

Daytona

2011

115,200

Aframax

 

 

 

Mareta

2012

115,200

Aframax

 

 

 

Blanca

 2013

158,300

Suezmax

 

 

 

Bordeira

2013

158,300

Suezmax

 

 

 

Esperona

2013

158,300

Suezmax

 

 

 

Lipari

 2012

158,300

Suezmax

 

 

 

Petalidi

2012

158,300

Suezmax

 

 

 


* Based on a synthetic time charter






Drybulk Carrier Segment Summary Operating Data (unaudited)

(Dollars in thousands, except average daily results)


 

Three Months Ended

 December 31,

 

Year Ended

 December 31,

 

 

2009

 

2010

 

2009

 

2010

Average number of vessels(1)

 

39.0

 

37.0

 

38.1

 

37.2

Total voyage days for vessels(2)

 

3,535

 

3,341

 

13,660

 

13,372

Total calendar days for vessels(3)

 

3,588

 

3,404

 

13,914

 

13,583

Fleet utilization(4)

 

98.5%

 

98.1%

 

98.2%

 

98.5%

Time charter equivalent(5)

 

31,683

 

31,929

 

30,425

 

32,184

Vessel operating expenses (daily)(6)

 

5,553

 

5,577

 

5,434

 

5,245


(1) Average number of vessels is 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 calendar days in that period.

(2) Total voyage days for fleet are the total days the vessels were in our possession for the relevant period net of off hire days.

(3) Calendar days are the total number of days the vessels were in our possession for the relevant period including off hire days.

(4) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period.

(5) Time charter equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE is consistent with industry standards and is determined by dividing voyage revenues (net of voyage expenses) by voyage days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract, as well as commissions. TCE is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance despite changes in the mix of charter types (i.e., spot charters, time charters and bareboat charters) under which the vessels may be employed between the periods.

 

 

Three Months Ended

 December 31,

 

Year Ended

December 31,

 

 

2009

 

2010

 

2009

 

2010

Voyage revenues

 

119,332

 

113,521

 

444,385

 

457,804

Voyage expenses

 

(7,332)

 

(6,844)

 

(28,779)

 

(27,433)

Time charter equivalent revenues

 

112,000

 

106,677

 

415,606

 

430,371

Total voyage days for fleet   

 

3,535

 

3,341

 

13,660

 

13,372

Time charter equivalent TCE

 

31,683

 

31,929

 

30,425

 

32,184


 (6) Daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs is calculated by dividing vessel operating expenses by fleet calendar days for the relevant time period.




Dryships Inc.


Financial Statements


Unaudited Condensed Consolidated Statements of Operations



(Expressed in Thousands of U.S. Dollars-

except for share and per share data)

 


Three Months Ended

December 31,

 


Year Ended

December 31,

 

 

 

2009

 

2010

 

2009

 

2010

 

 

 

(As restated)

 

 

 

(As restated)

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUES:

 

 

 

 

 

 

 

 

 

Voyage revenues

$

119,332

 

113,521

 

444,385

$

457,804

 

Revenues from drilling contracts

 

77,100

 

102,301

 

375,449

 

401,941

 

 

 

196,432

 

215,822

 

819,834

 

859,745

 

 

 

 

 

 

 

 

 

 

 

EXPENSES:

 

 

 

 

 

 

 

 

 

Voyage expenses

 

7,332

 

           6,844

 

28,779

 

27,433

 

Vessel operating expenses

 

19,924

 

18,984

 

75,605

 

71,245

 

Drilling rigs operating expenses

 

25,589

 

33,015

 

126,282

 

119,369

 

Depreciation and amortization

 

50,127

 

46,883

 

196,309

 

190,911

 

Loss/ (gain) on sale of vessels

 

-

 

708

 

(2,045)

 

(9,435)

 

Loss on contract cancellations, net

 

32,773

 

-

 

244,189

 

-

 

Vessel impairment charge

 

1,578

 

5,568

 

1,578

 

5,568

 

General and administrative expenses

 

24,510

 

25,203

 

90,823

 

87,264

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

34,599

 

78,617

 

58,314

 

367,390

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME / (EXPENSES):

 

 

 

 

 

 

 

 

 

Interest and finance costs, net of interest income

 

(16,222)

 

           (3,900)

 

(75,725)

 

(45,959)

 

Gain/(loss) on interest rate swaps

 

2,171

 

26,884

 

23,160

 

(120,505)

 

Other, net

 

(8,006)

 

5,899

 

(6,692)

 

9,960

 

Income taxes

 

(2,938)

 

(5,640)

 

(12,797)

 

(20,436)

 

Total other income/(expenses), net

 

(24,995)

 

23,243

 

(72,054)

 

(176,940)

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

9,604

 

101,860

 

(13,740)

 

190,450

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to non-controlling interests

 

-

 

(2,123)

 

(7,178)

 

(2,123)

 

 

 

 

 

 

 

 

 

 

 

Net  income/(loss) attributable

to Dryships Inc.


$


9,604



99,737



(20,918)


$


188,327

 

 

 

 

 

 

 

 

 

 

 


Earnings/(loss) per common share, basic

$

0.022

 

0.308

 

(0.136)

$

0.642

 


Weighted average number of shares, basic

 

253,951,696

 

307,926,254

 

209,331,737

 

268,858,688

 


Earnings/(loss) per common share, diluted

$

0.022

 

0.290

 

(0.136)

$

0.617

 


Weighted average number of shares, diluted

 

253,951,696

 

344,493,418

 

209,331,737

 

305,425,852

 

 

 

 

 

 

 

 

 

 

 







Dryships Inc.


Unaudited Condensed Consolidated Balance Sheets



 

 

 

 

 

 

(Expressed in Thousands of U.S. Dollars)

 

December 31, 2009

   


December 31, 2010

 

 

(As restated)

 

 

ASSETS

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

$

693,169

$

391,530

 

Restricted cash

 

350,833

 

530,156

 

Trade accounts receivable, net

 

66,681

 

25,204

 

Other current assets

 

69,967

 

70,065

 

Total current assets

 

1,180,650

 

1,016,955

 

 

 

 

 

 

FIXED ASSETS, NET:

 

 

 

 

 

Advances for assets under construction and acquisitions

 

1,181,228

 

2,071,327

 

Vessels, net

 

2,058,329

 

1,917,966

 

Drilling rigs, machinery and equipment, net

 

1,329,641

 

1,249,333

 

Total fixed assets, net

 

4,569,198

 

5,238,626

 

 

 

 

 

 

OTHER NON CURRENT ASSETS:

 

 

 

 

 Restricted cash

 

-

 

243,672

 Other non-current assets

 

55,775

 

483,869

Total non current assets

 

55,775

 

727,541

 

Total assets

 

5,805,623

 

6,983,122

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Current portion of long-term debt

 

1,698,692

 

731,232

 

Other current liabilities

 

197,331

 

204,203

 

Total current liabilities

 

1,896,023

 

935,435

 

 

 

 

 

 

NON CURRENT LIABILITIES

 

 

 

 

Long-term debt, net of current portion

 

985,992

 

1,988,460

Other non-current liabilities

 

112,438

 

161,070

Total non current liabilities

 

1,098,430

 

2,149,530

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

-

 

-

 

 

 

 

 

STOCKHOLDERS’ EQUITY:

 

 

 

 

 

Total Dryhsips Inc. stockholders’ equity

 

2,811,170

 

3,361,881

 

Non controlling interests

 

-

 

536,276

 

Total equity

 

2,811,170

 

3,898,157

 

Total liabilities and stockholders’ equity

$

5,805,623

$

6,983,122

 

 

 

 

 

 

 










Ocean Rig UDW Inc.


Financial Statements


Unaudited Condensed Consolidated Statements of Operations



(Expressed in Thousands of U.S. Dollars-

except for share and per share data)

 


Three Months Ended

December 31,

 


Year Ended

December 31,

 

 

 

2009

 

2010

 

2009

 

2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUES:

 

 

 

 

 

 

 

 

 

Revenues from drilling contracts

$

75,560

 

102,301

 

388,122

 

405,712

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXPENSES:

 

 

 

 

 

 

 

 

 

Drilling rigs operating expenses

 

27,332

 

33,015

 

133,256

 

119,369

 

Depreciation and amortization

 

19,296

 

17,831

 

75,348

 

75,092

 

Loss/ (gain) on sale of vessels

 

-

 

707

 

-

 

1,458

 

General and administrative expenses

 

4,408

 

5,211

 

17,955

 

19,443

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

24,524

 

45,537

 

161,563

 

190,350

 


 

 

 

 

 

 

 

 

 

OTHER INCOME / (EXPENSES):

 

 

 

 

 

 

 

 

 

Interest income

 

2,146

 

           3,122

 

6,259

 

12,464

 

Interest and finance costs

 

(3,590)

 

(2,415)

 

(46,120)

 

(8,418)

 

Gain/(loss) on interest rate swaps

 

3,129

 

12,478

 

4,826

 

(40,303)

 

Other, net

 

(567)

 

247

 

2,023

 

1,104

 

Income taxes

 

(2,938)

 

(5,640)

 

(12,797)

 

(20,436)

 

Total other income/(expenses), net

 

(1,820)

 

7,792

 

(45,809)

 

(55,589)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net  income/(loss)

$

22,704

 

53,329

 

115,754

$

134,761

 

 

 

 

 

 

 

 

 

 

 


Earnings/(loss) per common share, basic

$

0.22

 

0.50

 

1,12

$

1,30

 


Weighted average number of shares, basic

 

103,125,500

 

106,231,090

 

103,125,500

 

103,908,279

 


Earnings/(loss) per common share, diluted

$

0.22

 

0.50

 

1,12

$

1,30

 


Weighted average number of shares, diluted

 

103,125,500

 

106,231,090

 

103,125,500

 

103,908,279

 

 

 

 

 

 

 

 

 

 

 









Ocean Rig UDW Inc.


Unaudited Condensed Consolidated Balance Sheets



 

 

 

 

 

 

(Expressed in Thousands of U.S. Dollars)

 

December 31, 2009

   


December 31, 2010


 

 

 

 

ASSETS

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

$

234,195

$

95,707

 

Restricted cash

 

220,690

 

464,638

 

Trade accounts receivable, net

 

65,486

 

24,286

 

Other current assets

 

38,187

 

39,220

 

Total current assets

 

558,558

 

623,851

 

 

 

 

 

 

FIXED ASSETS, NET:

 

 

 

 

 

Advances for assets under construction and acquisitions

 

1,178,392

 

1,888,490

 

Drilling rigs, machinery and equipment, net

 

1,317,607

 

1,249,333

 

Total fixed assets, net

 

2,495,999

 

3,137,823

 

 

 

 

 

 

OTHER NON CURRENT ASSETS:

 

 

 

 

 Other non-current assets

 

55,428

 

582,024

Total non current assets

 

55,428

 

582,024

 

Total assets

 

3,109,985

 

4,343,698

 

 

 

 

 

 



LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Current portion of long-term debt

 

537,668

 

560,561

 

Other current liabilities

 

144,619

 

107,357

 

Total current liabilities

 

682,287

 

667,918

 

 

 

 

 

 

NON CURRENT LIABILITIES

 

 

 

 

Long-term debt, net of current portion

 

662,362

 

696,986

Other non-current liabilities

 

64,219

 

97,712

Total non current liabilities

 

726,581

 

794,698

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

-

 

-



 

 

 

 


STOCKHOLDERS’ EQUITY:

 

 

 

 

 

Total stockholders’ equity

 

1,701,117

 

2,881,082

 

Total equity

 

1,701,117

 

2,881,082

 

Total liabilities and stockholders equity

$

3,109,985

$

4,343,698

 

 

 

 

 

 

 








Adjusted EBITDA Reconciliation

Adjusted EBITDA represents net income before interest, taxes, depreciation and amortization and gains or losses on interest rate swaps. Adjusted EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by U.S. GAAP, and our calculation of adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is included herein because it is a basis upon which the Company measures its operations and efficiency. Adjusted EBITDA is also used by our lenders as a measure of our compliance with certain covenants contained in our loan agreements and because the Company believes that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness.

The following table reconciles net income to Adjusted EBITDA:

Dryships Inc.


(Expressed in Thousands of U.S. Dollars)

 

 Three Months Ended December 31, 2009

 

 Three Months Ended December 31, 2010

 

Year Ended December 31, 2009

 

Year Ended December 31, 2010

 

 

(As restated)

 

 

 

(As restated)

 

 

 

 

 

 

 

 

 

 

 

Net  income/(loss) attributable

to Dryships Inc.

 


9,604

 


99,737

 


(20,918)

 


188,327

 

 

 

 

 

 

 

 

 

Add: Net interest expense

 

16,222

 

3,900

 

75,725

 

45,959

Add: Depreciation and amortization

 

50,127

 

46,883

 

196,309

 

190,911

Add: Income taxes

 

2,938

 

5,640

 

12,797

 

20,436

Add: Loss/ (gain) on interest rate swaps

 

(2,171)

 

(26,884)

 

(23,160)

 

120,505

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

76,720

 

129,276

 

240,753

 

566,138


Ocean Rig UDW Inc.


(Expressed in Thousands of U.S. Dollars)

 

 Three Months Ended December 31, 2009

 

 Three Months Ended December 31, 2010

 

Year Ended December 31, 2009

 

Year Ended December 31, 2010

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

22,704

 

53,329

 

115,754

 

134,761

 

 

 

 

 

 

 

 

 

Add: Net interest expense

 

1,444

 

(707)

 

39,861

 

(4,046)

Add: Depreciation and amortization

 

16,427

 

17,831

 

75,348

 

75,092

Add: Income taxes

 

2,938

 

5,640

 

12,797

 

20,436

Add: Loss/ (gain) on interest rate swaps

 

(3,129)

 

(12,478)

 

(4,826)

 

40,303

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

40,384

 

63,615

 

238,934

 

266,546




Conference Call and Webcast: Thursday March 31, 2011

As announced, the Company’s management team will host a conference call, on Thursday, March 31, 2011 at 8:00 AM Eastern Daylight Time to discuss the Company's financial results.


Conference Call details:

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329 (from the UK) or +(44) (0) 1452 542 301 (from outside the US). Please quote "DryShips."


A replay of the conference call will be available until April 2, 2011. The United States replay number is 1(866) 247-4222; from the UK 0(800) 953-1533; the standard international replay number is (+44) (0) 1452 550 000 and the access code required for the replay is: 2133051#.


Slides and audio webcast:

There will also be a simultaneous live webcast over the Internet, through the DryShips Inc. website (www.dryships.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About DryShips Inc.


DryShips Inc., based in Greece, is an owner of drybulk carriers and tankers that operate worldwide. Through its majority owned subsidiary, Ocean Rig UDW, Inc., DryShips owns and operates 6 offshore ultra deepwater drilling units, comprising of 2 ultra deepwater semisubmersible drilling rigs and 4 ultra deepwater drillships, 2 of which will be delivered to the company during 2011. As of the day of this release, DryShips owns a fleet of 38 drybulk carriers (including newbuildings), comprising 7 Capesize, 29 Panamax and 2 Supramax, with a combined deadweight tonnage of over 3.4 million tons, and 12 tankers (including newbuildings), comprising 6 Suezmax and 6 Aframax, with a combined deadweight tonnage of over 1.6 million tons.

DryShips Inc.’s common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "DRYS".

Visit the Company’s website at www.dryships.com

Forward-Looking Statement

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may 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.

The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, 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 it will achieve or accomplish these expectations, beliefs or projections.

Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charterhire and drilling dayrates and drybulk carrier, tanker vessel, drilling rig and drillship values, failure of a seller to deliver one or more drilling units or drybulk carrier or tanker vessels, failure of a buyer to accept delivery of a drilling unit or vessel, inability to procure acquisition financing, default by one or more charterers of our ships, changes in demand for drybulk commodities or oil or petroleum products, changes in demand that may affect attitudes of time charterers and customer drilling programs, scheduled and unscheduled drydockings and upgrades, 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, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by DryShips Inc. with the US Securities and Exchange Commission.

Investor Relations / Media:

Nicolas Bornozis

Capital Link, Inc. (New York)

Tel. 212-661-7566

E-mail: dryships@capitallink.com

 



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.

 

 

  

DryShips Inc.                        

  

(Registrant)

  

  

Dated:  March 31, 2011

By:  /s/George Economou    

  

  

George Economou

Chief Executive Officer



Footnotes

1 Please see later in this release for a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure calculated in accordance with United States generally accepted accounting principles, or U.S. GAAP.