Global Ship Lease, Inc.
|
(Translation of registrant's name into English)
|
c/o Portland House,
Stag Place,
London SW1E 5RS,
United Kingdom
|
(Address of principal executive office)
|
GLOBAL SHIP LEASE, INC.
|
||
(registrant)
|
||
Dated: August 1, 2019
|
By:
|
/s/ Ian J. Webber
|
Ian J. Webber
|
||
Chief Executive Officer
|
||
Three
months ended
|
Three
months ended
|
Six
months
ended
|
Six
months
ended
|
|||||||||||||
June 30, 2019
|
June 30, 2018
|
June 30, 2019
|
June 30, 2018
|
|||||||||||||
Operating Revenue (1)
|
63,087
|
35,040
|
127,601
|
71,186
|
||||||||||||
Operating Income
|
27,156
|
15,185
|
56,381
|
30,670
|
||||||||||||
Net Income (2)
|
8,797
|
4,020
|
18,849
|
8,212
|
||||||||||||
Adjusted EBITDA (3)
|
38,800
|
23,367
|
79,327
|
47,014
|
Three months ended
|
Six months ended
|
Year ended
|
||||||||||||||||||||||||||||||
June 30,
|
June 30,
|
June 30,
|
June 30,
|
Dec 31,
|
Dec 31,
|
Dec 31,
|
Dec 31,
|
|||||||||||||||||||||||||
Days
|
2019
|
2018
|
2019
|
2018
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||||||||||
Ownership days
|
3,492
|
1,651
|
6,912
|
3,271
|
7,675
|
6,570
|
6,588
|
6,893
|
||||||||||||||||||||||||
Planned offhire - dry-dockings
|
(174
|
)
|
(18
|
)
|
(174
|
)
|
(31
|
)
|
(34
|
)
|
(62
|
)
|
(100
|
)
|
(9
|
)
|
||||||||||||||||
Unplanned offhire
|
(19
|
)
|
(3
|
)
|
(24
|
)
|
(7
|
)
|
(17
|
)
|
(40
|
)
|
(3
|
)
|
(7
|
)
|
||||||||||||||||
Idle time
|
(18
|
)
|
(13
|
)
|
(18
|
)
|
(13
|
)
|
(47
|
)
|
0
|
0
|
(13
|
)
|
||||||||||||||||||
Operating days
|
3,281
|
1,617
|
6,696
|
3,220
|
7,577
|
6,468
|
6,485
|
6,864
|
||||||||||||||||||||||||
Utilization
|
94.0
|
%
|
97.9
|
%
|
96.9
|
%
|
98.4
|
%
|
98.7
|
%
|
98.4
|
%
|
98.4
|
%
|
99.6
|
%
|
Ship Name
|
Capacity in TEUs
|
Lightweight (tons)
|
Year Built
|
Charterer
|
Earliest
Charter Expiry Date
|
Latest
Charter Expiry Date
|
Daily Charter Rate $
|
CMA CGM Thalassa
|
11,040
|
38,577
|
2008
|
CMA CGM
|
4Q25
|
1Q26
|
47,200
|
UASC Al Khor(1)
|
9,115
|
31,764
|
2015
|
Hapag-Lloyd
|
1Q22
|
2Q22
|
34,000
|
Anthea Y(1)
|
9,115
|
31,890
|
2015
|
COSCO
|
2Q20
|
3Q20
|
39,200
|
Maira XL(1)
|
9,115
|
31,820
|
2015
|
COSCO
|
2Q20
|
3Q20
|
39,200
|
MSC Tianjin
|
8,667
|
34,243
|
2005
|
MSC
|
2Q24
|
3Q24(2)
|
-(2)
|
MSC Qingdao
|
8,667
|
34,305
|
2004
|
MSC
|
2Q24
|
3Q24(2)
|
-(2)
|
GSL Ningbo
|
8,667
|
34,243
|
2004
|
Maersk
|
3Q19
|
4Q20
|
12,400(3)
|
GSL Kalliopi
|
7,849
|
29,105
|
2004
|
Maersk
|
3Q22
|
4Q24(4)
|
-(4)
|
GSL Grania
|
7,849
|
-
|
2004
|
Maersk
|
3Q22
|
4Q24(4)
|
-(4)
|
GSL Eleni
|
7,849
|
29,261
|
2004
|
Maersk
|
2Q24
|
3Q24(4)
|
-(4)
|
Mary(1)
|
6,927
|
23,424
|
2013
|
CMA CGM
|
3Q23
|
4Q23
|
25,910
|
Kristina(1)
|
6,927
|
23,424
|
2013
|
CMA CGM
|
2Q24
|
3Q24
|
25,910
|
Katherine(1)
|
6,927
|
23,424
|
2013
|
CMA CGM
|
1Q24
|
2Q24
|
25,910
|
Alexandra(1)
|
6,927
|
23,424
|
2013
|
CMA CGM
|
1Q24
|
2Q24
|
25,910
|
Alexis(1)
|
6,882
|
23,919
|
2015
|
CMA CGM
|
1Q24
|
2Q24
|
25,910
|
Olivia I(1)
|
6,882
|
23,864
|
2015
|
CMA CGM
|
1Q24
|
2Q24
|
25,910
|
CMA CGM Berlioz
|
6,621
|
26,776
|
2001
|
CMA CGM
|
2Q21
|
4Q21
|
34,000
|
Agios Dimitrios
|
6,572
|
24,746
|
2011
|
MSC
|
3Q19
|
4Q23
|
12,500(5)
|
Tasman
|
5,936
|
25,010
|
2000
|
ZIM
|
3Q19
|
3Q19(6)
|
11,500(6)
|
Dimitris Y
|
5,936
|
25,010
|
2000
|
ZIM
|
3Q19
|
3Q19(7)
|
16,750(7)
|
Ian H
|
5,936
|
25,128
|
2000
|
ZIM
|
1Q21
|
2Q21
|
14,500
|
Dolphin II
|
5,095
|
20,596
|
2007
|
HMM
|
3Q19(8)
|
4Q19(8)
|
7,700(8)
|
Orca I
|
5,095
|
20,696
|
2006
|
Maersk
|
2Q20(9)
|
2Q21(9)
|
9,000(9)
|
CMA CGM Alcazar
|
5,089
|
20,087
|
2007
|
CMA CGM
|
4Q20
|
2Q21
|
33,750
|
CMA CGM Château d’If
|
5,089
|
20,100
|
2007
|
CMA CGM
|
4Q20
|
2Q21
|
33,750
|
CMA CGM Jamaica
|
4,298
|
17,272
|
2006
|
CMA CGM
|
3Q22
|
1Q23
|
25,350
|
CMA CGM Sambhar
|
4,045
|
17,355
|
2006
|
CMA CGM
|
3Q22
|
1Q23
|
25,350
|
CMA CGM America
|
4,045
|
17,355
|
2006
|
CMA CGM
|
3Q22
|
1Q23
|
25,350
|
GSL Valerie
|
2,824
|
11,971
|
2005
|
MSC
|
2Q20
|
3Q20
|
9,000
|
Athena
|
2,762
|
13,538
|
2003
|
MSC
|
1Q20
|
2Q20
|
9,000
|
Maira
|
2,506
|
11,453
|
2000
|
MSC
|
3Q19
|
3Q19
|
8,500
|
Nikolas
|
2,506
|
11,370
|
2000
|
MSC
|
1Q20
|
1Q20
|
9,000
|
Newyorker
|
2,506
|
11,463
|
2001
|
MSC
|
1Q20
|
1Q20
|
9,000
|
CMA CGM La Tour
|
2,272
|
11,742
|
2001
|
CMA CGM
|
3Q19
|
1Q20
|
15,300
|
CMA CGM Manet
|
2,272
|
11,742
|
2001
|
CMA CGM
|
3Q19
|
1Q20
|
15,300
|
CMA CGM Matisse
|
2,262
|
11,676
|
1999
|
CMA CGM
|
3Q19
|
1Q20
|
15,300
|
CMA CGM Utrillo
|
2,262
|
11,676
|
1999
|
CMA CGM
|
3Q19
|
1Q20
|
15,300
|
GSL Keta
|
2,207
|
11,731
|
2003
|
ANL
|
3Q19
|
3Q19
|
8,450(10)
|
GSL Julie
|
2,207
|
11,731
|
2002
|
CMA CGM
|
3Q19
|
4Q19
|
7,200(11)
|
Kumasi
|
2,207
|
11,731
|
2002
|
CMA CGM
|
4Q19
|
1Q21(12)
|
9,800(12)
|
Marie Delmas
|
2,207
|
11,731
|
2002
|
CMA CGM
|
4Q19
|
1Q21(12)
|
9,800(12)
|
(thousands of U.S. dollars)
|
Three
|
Three
|
Six
|
Six
|
||||||||||||||
months
|
months
|
months
|
months
|
||||||||||||||
ended
|
ended
|
ended
|
ended
|
||||||||||||||
June 30,
|
June 30,
|
June 30,
|
June 30,
|
||||||||||||||
2019
|
2018
|
2019
|
2018
|
||||||||||||||
Net income available to Common Shareholders
|
8,797
|
4,020
|
18,849
|
8,212
|
|||||||||||||
Adjust: Depreciation and amortization
|
|
10,952
|
8,173
|
21,710
|
16,329
|
||||||||||||
Interest income
|
(367
|
)
|
(351
|
)
|
(784
|
)
|
(620
|
)
|
|||||||||
Interest expense
|
18,708
|
10,729
|
38,060
|
21,516
|
|||||||||||||
Income tax
|
(56
|
)
|
31
|
(40
|
)
|
46
|
|||||||||||
Earnings allocated to preferred shares
|
766
|
765
|
1,532
|
1,531
|
|||||||||||||
Adjusted EBITDA
|
38,800
|
23,367
|
79,327
|
47,014
|
• |
future operating or financial results;
|
• |
expectations regarding the future growth of the container shipping industry, including the rates of annual demand and supply growth;
|
• |
the financial condition of our charterers, particularly CMA CGM, our principal charterer and main source of operating revenue, and their ability to pay charterhire in accordance with the
charters;
|
• |
Global Ship Lease’s financial condition and liquidity, including its level of indebtedness or ability to obtain additional financing to fund capital expenditures, ship acquisitions and
other general corporate purposes;
|
• |
Global Ship Lease’s ability to meet its financial covenants and repay its credit facilities;
|
• |
Global Ship Lease’s expectations relating to dividend payments and forecasts of its ability to make such payments including the availability of cash and the impact of constraints under
its credit facility;
|
• |
risks relating to the acquisition of Poseidon Containers and Global Ship Lease’s ability to realize the anticipated benefits of the acquisition;
|
• |
future acquisitions, business strategy and expected capital spending;
|
• |
operating expenses, availability of crew, number of off-hire days, drydocking and survey requirements and insurance costs;
|
• |
general market conditions and shipping industry trends, including charter rates and factors affecting supply and demand;
|
• |
assumptions regarding interest rates and inflation;
|
• |
changes in the rate of growth of global and various regional economies;
|
• |
risks incidental to ship operation, including piracy, discharge of pollutants and ship accidents and damage including total or constructive total loss;
|
• |
estimated future capital expenditures needed to preserve its capital base;
|
• |
Global Ship Lease’s expectations about the availability of ships to purchase, the time that it may take to construct new ships, or the useful lives of its ships;
|
• |
Global Ship Lease’s continued ability to enter into or renew long-term, fixed-rate charters or other ship employment arrangements;
|
• |
the continued performance of existing long-term, fixed-rate time charters;
|
• |
Global Ship Lease’s ability to capitalize on its management’s and board of directors’ relationships and reputations in the containership industry to its advantage;
|
• |
changes in governmental and classification societies’ rules and regulations or actions taken by regulatory authorities;
|
• |
expectations about the availability of insurance on commercially reasonable terms;
|
• |
unanticipated changes in laws and regulations including taxation;
|
• |
potential liability from future litigation.
|
As of
|
||||||||
June 30,
2019
|
December 31,
2018
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS
|
||||||||
Cash and cash equivalents
|
$
|
75,399
|
$
|
82,059
|
||||
Restricted cash
|
3,367
|
2,186
|
||||||
Accounts receivable, net
|
2,944
|
1,927
|
||||||
Inventories
|
5,963
|
5,769
|
||||||
Prepaid expenses and other current assets
|
7,880
|
6,214
|
||||||
Due from related parties
|
3,982
|
817
|
||||||
Total current assets
|
$
|
99,535
|
$
|
98,972
|
||||
NON-CURRENT ASSETS
|
||||||||
Ships in operation
|
$
|
1,118,049
|
$
|
1,112,766
|
||||
Other fixed assets
|
2
|
5
|
||||||
Intangible assets-charter agreements
|
3,449
|
5,400
|
||||||
Deferred charges, net
|
8,730
|
9,569
|
||||||
Other non-current assets
|
—
|
948
|
||||||
Restricted cash, net of current portion
|
6,574
|
5,827
|
||||||
Total non-current assets
|
1,136,804
|
1,134,515
|
||||||
TOTAL ASSETS
|
$
|
1,236,339
|
$
|
1,233,487
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES
|
||||||||
Accounts payable
|
$
|
8,043
|
$
|
9,586
|
||||
Accrued liabilities
|
17,943
|
15,407
|
||||||
Current portion of long-term debt
|
75,732
|
64,088
|
||||||
Deferred revenue
|
2,330
|
3,118
|
||||||
Due to related parties
|
115
|
3,317
|
||||||
Total current liabilities
|
104,163
|
95,516
|
||||||
LONG-TERM LIABILITIES
|
||||||||
Long-term debt, net of current portion and deferred financing costs
|
$
|
789,499
|
$
|
813,130
|
||||
Intangible liability-charter agreements
|
7,466
|
8,470
|
||||||
Deferred tax liability
|
—
|
9
|
||||||
Total non-current liabilities
|
796,965
|
821,609
|
||||||
Total liabilities
|
$
|
901,128
|
$
|
917,125
|
||||
Commitments and Contingencies
|
—
|
—
|
||||||
SHAREHOLDERS' EQUITY
|
||||||||
Class A common shares - authorized
214,000,000 shares with a $0.01 par value 9,942,950 shares issued and outstanding (2018 – 9,017,205 shares) |
$
|
99
|
$
|
90
|
||||
Class B common shares - authorized
20,000,000 shares with a $0.01 par value nil shares issued and outstanding (2018 – 925,745 shares) |
—
|
9
|
||||||
Series B Preferred Shares - authorized
16,100 shares with a $0.01 par value 14,000 shares issued and outstanding (2018 – 14,000 shares) |
—
|
—
|
||||||
Series C Preferred Shares - authorized
250,000 shares with a $0.01 par value 250,000 shares issued and outstanding (2018 - 250,000 shares) |
3
|
3
|
||||||
Additional paid in capital
|
512,379
|
512,379
|
||||||
Accumulated deficit
|
(177,270
|
)
|
(196,119
|
)
|
||||
Total shareholders' equity
|
335,211
|
316,362
|
||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
1,236,339
|
$
|
1,233,487
|
Three months ended
June 30,
|
Six months ended
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
OPERATING REVENUES
|
||||||||||||||||
Time charter revenue
|
$
|
25,242
|
$
|
4,382
|
$
|
55,123
|
$
|
10,108
|
||||||||
Time charter revenue-related parties
|
37,845
|
30,658
|
72,478
|
61,078
|
||||||||||||
63,087
|
35,040
|
127,601
|
71,186
|
|||||||||||||
OPERATING EXPENSES:
|
||||||||||||||||
Vessel operating expenses
|
18,382
|
9,821
|
37,532
|
19,881
|
||||||||||||
Vessel operating expenses-related parties
|
2,428
|
214
|
4,233
|
536
|
||||||||||||
Time charter and voyage expenses
|
1,664
|
189
|
2,785
|
377
|
||||||||||||
Time charter and voyage expenses-related parties
|
420
|
—
|
850
|
—
|
||||||||||||
Depreciation and amortization
|
10,952
|
8,173
|
21,710
|
16,329
|
||||||||||||
General and administrative expenses
|
2,085
|
1,458
|
4,110
|
3,393
|
||||||||||||
Operating Income
|
27,156
|
15,185
|
56,381
|
30,670
|
||||||||||||
Interest income
|
367
|
351
|
784
|
620
|
||||||||||||
Interest and other financial expense
|
(18,708
|
)
|
(10,729
|
)
|
(38,060
|
)
|
(21,516
|
)
|
||||||||
Other income, net
|
692
|
9
|
1,236
|
15
|
||||||||||||
Total non-operating expense
|
(17,649
|
)
|
(10,369
|
)
|
(36,040
|
)
|
(20,881
|
)
|
||||||||
Income before income taxes
|
9,507
|
4,816
|
20,341
|
9,789
|
||||||||||||
Income taxes
|
56
|
(31
|
)
|
40
|
(46
|
)
|
||||||||||
Net Income
|
$
|
9,563
|
$
|
4,785
|
$
|
20,381
|
$
|
9,743
|
||||||||
Earnings allocated to Series B Preferred Shares
|
(766
|
)
|
(765
|
)
|
(1,532
|
)
|
(1,531
|
)
|
||||||||
Net Income available to Common Shareholders
|
$
|
8,797
|
$
|
4,020
|
$
|
18,849
|
$
|
8,212
|
||||||||
Earnings per Share
|
||||||||||||||||
Weighted average number of Class A common shares outstanding
|
||||||||||||||||
Basic and diluted (including RSU’s without service conditions)
|
9,942,950
|
6,050,658
|
9,937,836
|
6,040,792
|
||||||||||||
|
||||||||||||||||
Net Income per Class A common share
|
||||||||||||||||
Basic and diluted (including RSU’s without service conditions)
|
$
|
0.38
|
$
|
0.56
|
$
|
0.82
|
$
|
1.36
|
||||||||
|
||||||||||||||||
Weighted average number of Class B common shares outstanding
|
||||||||||||||||
Basic and diluted
|
nil
|
925,745
|
nil
|
925,745
|
||||||||||||
Net Income per Class B common share
|
||||||||||||||||
Basic and diluted
|
$nil
|
$nil
|
$nil
|
$nil
|
Three months ended
June 30,
|
Six months ended
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
Cash flows from operating activities:
|
||||||||||||||||
Net Income
|
$
|
9,563
|
$
|
4,785
|
$
|
20,381
|
$
|
9,743
|
||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||||||
Depreciation and amortization
|
10,952
|
8,174
|
21,710
|
16,329
|
||||||||||||
Amortization of deferred financing costs
|
744
|
986
|
1,489
|
2,015
|
||||||||||||
Amortization of original issue discount / premium on repurchase of notes
|
203
|
200
|
405
|
401
|
||||||||||||
Amortization of intangible asset/liability-charter agreements
|
479
|
(443
|
)
|
947
|
(886
|
)
|
||||||||||
Share based compensation
|
—
|
45
|
—
|
90
|
||||||||||||
Changes in operating assets and liabilities:
|
||||||||||||||||
Increase in accounts receivable and other assets
|
(1,652
|
)
|
(232
|
)
|
(1,746
|
)
|
(1,336
|
)
|
||||||||
Increase in inventories
|
(636
|
)
|
(83
|
)
|
(194
|
)
|
(1,866
|
)
|
||||||||
(Decrease) increase in accounts payable and other liabilities
|
(2,930
|
)
|
(10,078
|
)
|
789
|
(2,228
|
)
|
|||||||||
Decrease in related parties' balances
|
(4,329
|
)
|
(2,937
|
)
|
(6,367
|
)
|
(1,099
|
)
|
||||||||
Decrease in deferred revenue
|
(307
|
)
|
(198
|
)
|
(788
|
)
|
(510
|
)
|
||||||||
Unrealized foreign exchange loss (gain)
|
14
|
(6
|
)
|
10
|
(1
|
)
|
||||||||||
Net cash provided by operating activities
|
$
|
12,101
|
$
|
213
|
$
|
36,636
|
$
|
20,652
|
||||||||
Cash flows from investing activities:
|
||||||||||||||||
Acquisition of vessels
|
(18,496
|
)
|
(10,283
|
)
|
(18,496
|
)
|
(11,411
|
)
|
||||||||
Cash paid for vessel improvements
|
(6,139
|
)
|
—
|
(6,776
|
)
|
(150
|
)
|
|||||||||
Cash paid for dry-dockings
|
(646
|
)
|
(854
|
)
|
(696
|
)
|
(1,227
|
)
|
||||||||
Net cash used in investing activities
|
$
|
(25,281
|
)
|
$
|
(11,137
|
)
|
$
|
(25,968
|
)
|
$
|
(12,788
|
)
|
||||
Cash flows from financing activities:
|
||||||||||||||||
Proceeds from drawdown of credit facilities
|
13,000
|
—
|
13,000
|
—
|
||||||||||||
Repayment of credit facilities
|
(20,320
|
)
|
(10,000
|
)
|
(26,546
|
)
|
(10,000
|
)
|
||||||||
Deferred financing costs paid
|
(322
|
)
|
—
|
(322
|
)
|
—
|
||||||||||
Series B Preferred Shares-dividends paid
|
(766
|
)
|
(765
|
)
|
(1,532
|
)
|
(1,531
|
)
|
||||||||
Net cash used in financing activities
|
$
|
(8,408
|
)
|
$
|
(10,765
|
)
|
$
|
(15,400
|
)
|
$
|
(11,531
|
)
|
||||
Net decrease in cash and cash equivalents and restricted cash
|
(21,588
|
)
|
(21,689
|
)
|
(4,732
|
)
|
(3,667
|
)
|
||||||||
Cash and cash equivalents and restricted cash at beginning of the period
|
106,928
|
91,288
|
90,072
|
73,266
|
||||||||||||
Cash and cash equivalents and restricted cash at end of the period
|
$
|
85,340
|
$
|
69,599
|
$
|
85,340
|
$
|
69,599
|
||||||||
Supplementary Cash Flow Information:
|
||||||||||||||||
Cash paid for interest
|
7,812
|
19,289
|
17,375
|
19,937
|
||||||||||||
Cash paid for income taxes
|
—
|
16
|
—
|
28
|
||||||||||||
Non-cash investing activities:
|
||||||||||||||||
Unpaid capitalized expenses
|
—
|
—
|
—
|
—
|