GENCO SHIPPING & TRADING LTD, 10-Q filed on 11/9/2012
Quarterly Report
Document and Entity Information
9 Months Ended
Sep. 30, 2012
Nov. 9, 2012
Document and Entity Information
 
 
Entity Registrant Name
GENCO SHIPPING & TRADING LTD 
 
Entity Central Index Key
0001326200 
 
Document Type
10-Q 
 
Document Period End Date
Sep. 30, 2012 
 
Amendment Flag
false 
 
Current Fiscal Year End Date
--12-31 
 
Entity Current Reporting Status
Yes 
 
Entity Filer Category
Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
43,823,598 
Document Fiscal Year Focus
2012 
 
Document Fiscal Period Focus
Q3 
 
Condensed Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
Current assets:
 
 
Cash and cash equivalents
$ 87,778 
$ 227,968 
Due from charterers, net of a reserve of $495 and $906, respectively
8,616 
13,688 
Prepaid expenses and other current assets
17,020 
17,709 
Total current assets
113,414 
259,365 
Noncurrent assets:
 
 
Vessels, net of accumulated depreciation of $563,749 and $464,518, respectively
2,695,638 
2,794,860 
Deferred drydock, net of accumulated amortization of $6,675 and $11,111, respectively
13,723 
6,934 
Other assets, net of accumulated amortization of $11,304 and $7,749, respectively
31,907 
17,795 
Fixed assets, net of accumulated depreciation and amortization of $3,077 and $2,422, respectively
5,402 
5,591 
Other noncurrent assets
514 
514 
Restricted cash
10,150 
9,750 
Investments
23,825 
24,468 
Total noncurrent assets
2,781,159 
2,859,912 
Total assets
2,894,573 
3,119,277 
Current liabilities:
 
 
Accounts payable and accrued expenses
25,150 
30,712 
Current portion of long-term debt
 
185,077 
Deferred revenue
1,876 
4,227 
Current portion of lease obligations
642 
 
Fair value of derivative instruments
609 
1,686 
Total current liabilities
28,277 
221,702 
Noncurrent liabilities:
 
 
Long-term lease obligations
2,056 
1,823 
Time charters acquired
606 
1,164 
Fair value of derivative instruments
18,261 
23,654 
Convertible senior note payable
109,726 
106,381 
Long-term interest payable
13,199 
 
Long-term debt
1,413,439 
1,402,935 
Total noncurrent liabilities
1,557,287 
1,535,957 
Total liabilities
1,585,564 
1,757,659 
Commitments and contingencies
   
   
Genco Shipping & Trading Limited shareholders' equity:
 
 
Common stock, par value $0.01; 100,000,000 shares authorized; issued and outstanding 43,821,098 and 36,307,598 shares at September 30, 2012 and December 31, 2011, respectively
438 
363 
Additional paid-in capital
862,488 
809,443 
Accumulated other comprehensive loss
(11,798)
(17,549)
Retained earnings
260,031 
359,349 
Total Genco Shipping & Trading Limited shareholders' equity
1,111,159 
1,151,606 
Noncontrolling interest
197,850 
210,012 
Total equity
1,309,009 
1,361,618 
Total liabilities and equity
$ 2,894,573 
$ 3,119,277 
Condensed Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
Condensed Consolidated Balance Sheets
 
 
Due from charterers, reserve
$ 495 
$ 906 
Vessels, accumulated depreciation
563,749 
464,518 
Deferred drydock, accumulated amortization
6,675 
11,111 
Other assets, accumulated amortization
11,304 
7,749 
Fixed assets, accumulated depreciation and amortization
$ 3,077 
$ 2,422 
Common stock, par value (in dollars per share)
$ 0.01 
$ 0.01 
Common stock, shares authorized (in shares)
100,000,000 
100,000,000 
Common stock, shares issued (in shares)
43,821,098 
36,307,598 
Common stock, shares outstanding (in shares)
43,821,098 
36,307,598 
Condensed Consolidated Statements of Operations (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Revenues:
 
 
 
 
Voyage revenues
$ 53,603 
$ 93,484 
$ 174,740 
$ 292,614 
Service revenues
828 
828 
2,466 
2,457 
Total revenues
54,431 
94,312 
177,206 
295,071 
Operating expenses:
 
 
 
 
Voyage expenses
2,693 
1,702 
5,099 
2,595 
Vessel operating expenses
28,272 
26,133 
85,622 
76,394 
General, administrative, and management fees
8,622 
8,759 
25,680 
25,908 
Depreciation and amortization
35,038 
34,378 
103,954 
101,484 
Total operating expenses
74,625 
70,972 
220,355 
206,381 
Operating (loss) income
(20,194)
23,340 
(43,149)
88,690 
Other (expense) income:
 
 
 
 
Other (expense) income
(43)
31 
(40)
(80)
Interest income
49 
167 
352 
503 
Interest expense
(21,546)
(21,793)
(65,160)
(64,654)
Other expense
(21,540)
(21,595)
(64,848)
(64,231)
(Loss) income before income taxes
(41,734)
1,745 
(107,997)
24,459 
Income tax expense
(303)
(328)
(918)
(1,041)
Net (loss) income
(42,037)
1,417 
(108,915)
23,418 
Less: Net loss attributable to noncontrolling interest
(3,588)
(145)
(9,626)
(1,662)
Net (loss) income attributable to Genco Shipping & Trading Limited
$ (38,449)
$ 1,562 
$ (99,289)
$ 25,080 
Net (loss) income per share-basic (in dollars per share)
$ (0.90)
$ 0.04 
$ (2.40)
$ 0.71 
Net (loss) income per share-diluted (in dollars per share)
$ (0.90)
$ 0.04 
$ (2.40)
$ 0.71 
Weighted average common shares outstanding-basic (in shares)
42,885,810 
35,157,110 
41,290,719 
35,149,912 
Weighted average common shares outstanding-diluted (in shares)
42,885,810 
35,212,840 
41,290,719 
35,212,041 
Dividends declared per share (in dollars per share)
$ 0 
 
 
 
Condensed Consolidated Statements of Comprehensive (Loss) Income (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Net (loss) income
$ (42,037)
$ 1,417 
$ (108,915)
$ 23,418 
Change in unrealized gain on investments
(3,561)
(14,602)
(643)
(26,866)
Unrealized gain on cash flow hedges, net
1,525 
2,417 
6,394 
10,333 
Other comprehensive (loss) income
(2,036)
(12,185)
5,751 
(16,533)
Comprehensive (loss) income
(44,073)
(10,768)
(103,164)
6,885 
Less: Comprehensive loss attributable to noncontrolling interest
(3,588)
(145)
(9,626)
(1,662)
Comprehensive (loss) income attributable to Genco Shipping & Trading Limited
$ (40,485)
$ (10,623)
$ (93,538)
$ 8,547 
Condensed Consolidated Statements of Equity (USD $)
In Thousands, unless otherwise specified
Total
Genco Shipping & Trading Limited Shareholders' Equity
Common Stock
Additional Paid-in Capital
Accumulated Other Comprehensive (Loss) Income
Retained Earnings
Noncontrolling Interest
Balance at Dec. 31, 2010
$ 1,348,153 
$ 1,132,949 
$ 359 
$ 803,778 
$ (5,210)
$ 334,022 
$ 215,204 
Increase (Decrease) in Shareholders' Equity
 
 
 
 
 
 
 
Net income (loss)
23,418 
25,080 
 
 
 
25,080 
(1,662)
Change in unrealized gain on investments
(26,866)
(26,866)
 
 
(26,866)
 
 
Unrealized gain on cash flow hedges, net
10,333 
10,333 
 
 
10,333 
 
 
Issuance of 15,000 shares of nonvested stock, less forfeitures of 1,500 shares and 1,100 shares for year ended September 30, 2012 and 2011, respectively
 
 
 
 
 
 
Nonvested stock amortization
6,617 
4,443 
 
4,443 
 
 
2,174 
Cash dividends paid by Baltic Trading Limited
(5,575)
(45)
 
 
 
(45)
(5,530)
Vesting of restricted shares issued by Baltic Trading Limited
 
37 
 
37 
 
 
(37)
Balance at Sep. 30, 2011
1,356,080 
1,145,931 
359 
808,258 
(21,743)
359,057 
210,149 
Balance at Dec. 31, 2011
1,361,618 
1,151,606 
363 
809,443 
(17,549)
359,349 
210,012 
Increase (Decrease) in Shareholders' Equity
 
 
 
 
 
 
 
Net income (loss)
(108,915)
(99,289)
 
 
 
(99,289)
(9,626)
Change in unrealized gain on investments
(643)
(643)
 
 
(643)
 
 
Unrealized gain on cash flow hedges, net
6,394 
6,394 
 
 
6,394 
 
 
Issuance of 7,500,000 shares of common stock
49,874 
49,874 
75 
49,799 
 
 
 
Issuance of 15,000 shares of nonvested stock, less forfeitures of 1,500 shares and 1,100 shares for year ended September 30, 2012 and 2011, respectively
 
 
 
 
 
 
Nonvested stock amortization
4,591 
3,214 
 
3,214 
 
 
1,377 
Cash dividends paid by Baltic Trading Limited
(3,910)
(29)
 
 
 
(29)
(3,881)
Vesting of restricted shares issued by Baltic Trading Limited
 
32 
 
32 
 
 
(32)
Balance at Sep. 30, 2012
$ 1,309,009 
$ 1,111,159 
$ 438 
$ 862,488 
$ (11,798)
$ 260,031 
$ 197,850 
Condensed Consolidated Statements of Equity (Parenthetical)
9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Condensed Consolidated Statements of Equity
 
 
Issuance of common stock
7,500,000 
 
Issuance of shares of nonvested stock
15,000 
15,000 
Issuance of shares of nonvested stock, forfeitures
1,500 
1,100 
Condensed Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Cash flows from operating activities:
 
 
Net (loss) income
$ (108,915)
$ 23,418 
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
 
 
Depreciation and amortization
103,954 
101,484 
Amortization of deferred financing costs
3,555 
2,368 
Amortization of time charters acquired
(558)
(1,432)
Amortization of discount on Convertible Senior Notes
3,345 
2,999 
Unrealized gain on derivative instruments
(76)
(38)
Amortization of nonvested stock compensation expense
4,591 
6,617 
Change in assets and liabilities:
 
 
Decrease (increase) in due from charterers
5,072 
(2,275)
Decrease (increase) in prepaid expenses and other current assets
689 
(2,073)
Increase in other noncurrent assets
 
(514)
Decrease in accounts payable and accrued expenses
(3,751)
(2,143)
Decrease in deferred revenue
(2,351)
(5,359)
Increase in lease obligations
875 
953 
Deferred drydock costs incurred
(10,442)
(2,669)
Net cash (used in) provided by operating activities
(4,012)
121,336 
Cash flows from investing activities:
 
 
Purchase of vessels
(894)
(98,860)
Deposits on vessels
 
(87)
Purchase of other fixed assets
(1,948)
(692)
Changes in deposits of restricted cash
(400)
(750)
Net cash used in investing activities
(3,242)
(100,389)
Cash flows from financing activities:
 
 
Repayments on the 2007 Credit Facility
(118,588)
(37,500)
Proceeds from issuance of common stock
50,721 
 
Payment of common stock issuance costs
(847)
 
Payment of Convertible Senior Notes issuance costs
 
(51)
Payment of dividend by subsidiary
(3,910)
(5,576)
Payment of deferred financing costs
(4,327)
(328)
Net cash used in financing activities
(132,936)
(39)
Net (decrease) increase in cash and cash equivalents
(140,190)
20,908 
Cash and cash equivalents at beginning of period
227,968 
270,877 
Cash and cash equivalents at end of period
87,778 
291,785 
$100 Million Term Loan Facility
 
 
Cash flows from financing activities:
 
 
Proceeds from Term Loan Facility
 
40,000 
Repayments on Term Loan Facility
(15,385)
(3,243)
$253 Million Term Loan Facility
 
 
Cash flows from financing activities:
 
 
Proceeds from Term Loan Facility
 
21,500 
Repayments on Term Loan Facility
$ (40,600)
$ (14,841)
Condensed Consolidated Statements of Cash Flows (Parenthetical) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
$100 Million Term Loan Facility
 
Term Loan Facility
 
Term Loan Facility
$ 100,000 
$253 Million Term Loan Facility
 
Term Loan Facility
 
Term Loan Facility
$ 253,000 
GENERAL INFORMATION
GENERAL INFORMATION

1 - GENERAL INFORMATION

 

The accompanying condensed consolidated financial statements include the accounts of Genco Shipping & Trading Limited (“GS&T”), its wholly-owned subsidiaries, and its subsidiary, Baltic Trading Limited (collectively, the “Company”). The Company is engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk carrier vessels. GS&T is incorporated under the laws of the Marshall Islands and as of September 30, 2012, is the sole owner of all of the outstanding shares of the following subsidiaries: Genco Ship Management LLC; Genco Investments LLC; Genco Management (USA) Limited; and the ship-owning subsidiaries set forth below.

 

Below is the list of GS&T’s wholly owned ship-owning subsidiaries as of September 30, 2012:

 

Wholly Owned Subsidiaries

 

Vessels Acquired

 

Dwt

 

Delivery Date

 

Year Built

 

 

 

 

 

 

 

 

 

Genco Reliance Limited

 

Genco Reliance

 

29,952

 

12/6/04

 

1999

Genco Vigour Limited

 

Genco Vigour

 

73,941

 

12/15/04

 

1999

Genco Explorer Limited

 

Genco Explorer

 

29,952

 

12/17/04

 

1999

Genco Carrier Limited

 

Genco Carrier

 

47,180

 

12/28/04

 

1998

Genco Sugar Limited

 

Genco Sugar

 

29,952

 

12/30/04

 

1998

Genco Pioneer Limited

 

Genco Pioneer

 

29,952

 

1/4/05

 

1999

Genco Progress Limited

 

Genco Progress

 

29,952

 

1/12/05

 

1999

Genco Wisdom Limited

 

Genco Wisdom

 

47,180

 

1/13/05

 

1997

Genco Success Limited

 

Genco Success

 

47,186

 

1/31/05

 

1997

Genco Beauty Limited

 

Genco Beauty

 

73,941

 

2/7/05

 

1999

Genco Knight Limited

 

Genco Knight

 

73,941

 

2/16/05

 

1999

Genco Leader Limited

 

Genco Leader

 

73,941

 

2/16/05

 

1999

Genco Marine Limited

 

Genco Marine

 

45,222

 

3/29/05

 

1996

Genco Prosperity Limited

 

Genco Prosperity

 

47,180

 

4/4/05

 

1997

Genco Muse Limited

 

Genco Muse

 

48,913

 

10/14/05

 

2001

Genco Acheron Limited

 

Genco Acheron

 

72,495

 

11/7/06

 

1999

Genco Surprise Limited

 

Genco Surprise

 

72,495

 

11/17/06

 

1998

Genco Augustus Limited

 

Genco Augustus

 

180,151

 

8/17/07

 

2007

Genco Tiberius Limited

 

Genco Tiberius

 

175,874

 

8/28/07

 

2007

Genco London Limited

 

Genco London

 

177,833

 

9/28/07

 

2007

Genco Titus Limited

 

Genco Titus

 

177,729

 

11/15/07

 

2007

Genco Challenger Limited

 

Genco Challenger

 

28,428

 

12/14/07

 

2003

Genco Charger Limited

 

Genco Charger

 

28,398

 

12/14/07

 

2005

Genco Warrior Limited

 

Genco Warrior

 

55,435

 

12/17/07

 

2005

Genco Predator Limited

 

Genco Predator

 

55,407

 

12/20/07

 

2005

Genco Hunter Limited

 

Genco Hunter

 

58,729

 

12/20/07

 

2007

Genco Champion Limited

 

Genco Champion

 

28,445

 

1/2/08

 

2006

Genco Constantine Limited

 

Genco Constantine

 

180,183

 

2/21/08

 

2008

Genco Raptor LLC

 

Genco Raptor

 

76,499

 

6/23/08

 

2007

Genco Cavalier LLC

 

Genco Cavalier

 

53,617

 

7/17/08

 

2007

Genco Thunder LLC

 

Genco Thunder

 

76,588

 

9/25/08

 

2007

Genco Hadrian Limited

 

Genco Hadrian

 

169,694

 

12/29/08

 

2008

Genco Commodus Limited

 

Genco Commodus

 

169,025

 

7/22/09

 

2009

Genco Maximus Limited

 

Genco Maximus

 

169,025

 

9/18/09

 

2009

Genco Claudius Limited

 

Genco Claudius

 

169,025

 

12/30/09

 

2010

Genco Bay Limited

 

Genco Bay

 

34,296

 

8/24/10

 

2010

Genco Ocean Limited

 

Genco Ocean

 

34,409

 

7/26/10

 

2010

Genco Avra Limited

 

Genco Avra

 

34,391

 

5/12/11

 

2011

Genco Mare Limited

 

Genco Mare

 

34,428

 

7/20/11

 

2011

Genco Spirit Limited

 

Genco Spirit

 

34,432

 

11/10/11

 

2011

Genco Aquitaine Limited

 

Genco Aquitaine

 

57,981

 

8/18/10

 

2009

Genco Ardennes Limited

 

Genco Ardennes

 

57,981

 

8/31/10

 

2009

Genco Auvergne Limited

 

Genco Auvergne

 

57,981

 

8/16/10

 

2009

Genco Bourgogne Limited

 

Genco Bourgogne

 

57,981

 

8/24/10

 

2010

Genco Brittany Limited

 

Genco Brittany

 

57,981

 

9/23/10

 

2010

Genco Languedoc Limited

 

Genco Languedoc

 

57,981

 

9/29/10

 

2010

Genco Loire Limited

 

Genco Loire

 

53,416

 

8/4/10

 

2009

Genco Lorraine Limited

 

Genco Lorraine

 

53,416

 

7/29/10

 

2009

Genco Normandy Limited

 

Genco Normandy

 

53,596

 

8/10/10

 

2007

Genco Picardy Limited

 

Genco Picardy

 

55,257

 

8/16/10

 

2005

Genco Provence Limited

 

Genco Provence

 

55,317

 

8/23/10

 

2004

Genco Pyrenees Limited

 

Genco Pyrenees

 

57,981

 

8/10/10

 

2010

Genco Rhone Limited

 

Genco Rhone

 

58,018

 

3/29/11

 

2011

 

Baltic Trading Limited (“Baltic Trading”) was a wholly-owned indirect subsidiary of GS&T until Baltic Trading completed its initial public offering, or IPO, on March 15, 2010.  As of September 30, 2012 and December 31, 2011, GS&T’s wholly-owned subsidiary Genco Investments LLC owned 5,699,088 shares of Baltic Trading’s Class B Stock, which represented a 25.09% and 25.11% ownership interest in Baltic Trading, respectively, and 83.40% and 83.41% of the aggregate voting power of Baltic Trading’s outstanding shares of voting stock, respectively.  Additionally, pursuant to the subscription agreement between Genco Investments LLC and Baltic Trading, for so long as GS&T directly or indirectly holds at least 10% of the aggregate number of outstanding shares of Baltic Trading’s common stock and Class B stock, Genco Investments LLC will be entitled to receive an additional number of shares of Baltic Trading’s Class B stock equal to 2% of the number of common shares issued in the future, other than shares issued under Baltic Trading’s 2010 Equity Incentive Plan.

 

Below is the list of Baltic Trading’s wholly owned ship-owning subsidiaries as of September 30, 2012:

 

Baltic Trading’s Wholly Owned
Subsidiaries

 

Vessel

 

Dwt

 

Delivery Date

 

Year
Built

 

 

 

 

 

 

 

 

 

Baltic Leopard Limited

 

Baltic Leopard

 

53,447

 

4/8/10

 

2009

Baltic Panther Limited

 

Baltic Panther

 

53,351

 

4/29/10

 

2009

Baltic Cougar Limited

 

Baltic Cougar

 

53,432

 

5/28/10

 

2009

Baltic Jaguar Limited

 

Baltic Jaguar

 

53,474

 

5/14/10

 

2009

Baltic Bear Limited

 

Baltic Bear

 

177,717

 

5/14/10

 

2010

Baltic Wolf Limited

 

Baltic Wolf

 

177,752

 

10/14/10

 

2010

Baltic Wind Limited

 

Baltic Wind

 

34,409

 

8/4/10

 

2009

Baltic Cove Limited

 

Baltic Cove

 

34,403

 

8/23/10

 

2010

Baltic Breeze Limited

 

Baltic Breeze

 

34,386

 

10/12/10

 

2010

 

The Company provides technical services for drybulk vessels purchased by Maritime Equity Partners LLC (“MEP”), which is managed by a company owned by Peter C. Georgiopoulos, Chairman of the Board of Directors of GS&T.  These services include oversight of crew management, insurance, drydocking, ship operations and financial statement preparation, but do not include chartering services.  The services are provided for a fee of $750 per ship per day plus reimbursement of out-of-pocket costs and will be provided for an initial term of one year.  MEP has the right to cancel provision of services on 60 days’ notice with payment of a one-year termination fee upon a change in control of the Company.  The Company may terminate provision of the services at any time on 60 days’ notice.  Peter C. Georgiopoulos, the Company’s Chairman of the Board, is a minority investor in MEP, and affiliates of Oaktree Capital Management, L.P., of which Stephen A. Kaplan, a director of the Company, is a principal, are majority investors in MEP.

 

On February 28, 2012, the Company closed on an equity offering of 7,500,000 shares of common stock at an offering price of $7.10 per share.  The Company received net proceeds of $49,874 after deducting underwriters’ fees and expenses.

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Principles of consolidation

 

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which include the accounts of GS&T, its wholly-owned subsidiaries and Baltic Trading, a subsidiary in which the Company owns a majority of the voting interests and exercises control.  All intercompany accounts and transactions have been eliminated in consolidation.

 

Basis of presentation

 

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”).  In the opinion of management of the Company, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and operating results have been included in the statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted.  These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2011 (the “2011 10-K”).  The results of operations for the three and nine month period ended September 30, 2012 and 2011 are not necessarily indicative of the operating results for the full year.

 

Vessels, net

 

Vessels, net is stated at cost less accumulated depreciation. Included in vessel costs are acquisition costs directly attributable to the acquisition of a vessel and expenditures made to prepare the vessel for its initial voyage. The Company also capitalizes interest costs for a vessel under construction as a cost that is directly attributable to the acquisition of a vessel. Vessels are depreciated on a straight-line basis over their estimated useful lives, determined to be 25 years from the date of initial delivery from the shipyard. Depreciation expense for vessels for the three months ended September 30, 2012 and 2011 was $33,462 and $33,054, respectively.  Depreciation expense for vessels for the nine months ended September 30, 2012 and 2011 was $99,646 and $96,773, respectively.

 

Depreciation expense is calculated based on cost less the estimated residual scrap value. The costs of significant replacements, renewals and betterments are capitalized and depreciated over the shorter of the vessel’s remaining estimated useful life or the estimated life of the renewal or betterment. Undepreciated cost of any asset component being replaced that was acquired after the initial vessel purchase is written off as a component of vessel operating expense. Expenditures for routine maintenance and repairs are expensed as incurred. Scrap value is estimated by the Company by taking the estimated scrap value of $245/lwt multiplied by the weight of the ship in lightweight tons (lwt).

 

Deferred revenue

 

Deferred revenue primarily relates to cash received from charterers prior to it being earned. These amounts are recognized as revenue when earned. Additionally, deferred revenue includes estimated customer claims mainly due to time charter performance issues. As of September 30, 2012 and December 31, 2011, the Company had an accrual of $563 and $762, respectively, related to these estimated customer claims.

 

Voyage revenues

 

Since the Company’s inception, revenues have been generated from time charter agreements, pool agreements and spot market-related time charters.  A time charter involves placing a vessel at the charterer’s disposal for a set period of time during which the charterer may use the vessel in return for the payment by the charterer of a specified daily hire rate, including any ballast bonus payments received pursuant to the time charter agreement.  Spot market-related time charters are the same as other time charter agreements, except the time charter rates are variable and are based on a percentage of the average daily rates as published by the Baltic Dry Index (“BDI”).  Voyage revenues also include sale of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement.

 

Voyage expense recognition

 

In time charters, spot market-related time charters and pool agreements, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. There are certain other non-specified voyage expenses such as commissions, which are typically borne by the Company. At the inception of a time charter, the Company records the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer as a gain or loss within voyage expenses. These differences in bunkers resulted in net gains of $242 and $666 during the three months ended September 30, 2012 and 2011, respectively, and $1,665 and $2,319 during the nine months ended September 30, 2012 and 2011, respectively.  Additionally, voyage expenses include the cost of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement.

 

Noncontrolling interest

 

Net loss attributable to noncontrolling interest during the three and nine months ended September 30, 2012 and 2011 reflects the noncontrolling interest’s share of the net loss of Baltic Trading, a subsidiary of the Company, which owns and employs drybulk vessels in the spot market or on spot market-related time charters.  The spot market represents immediate chartering of a vessel, usually for single voyages.  At September 30, 2012, the noncontrolling interest held a 74.91% economic interest in Baltic Trading while only holding 16.60% of voting power.  At December 31, 2011, the noncontrolling interest held a 74.89% economic interest in Baltic Trading while only holding 16.59% of voting power.

 

Income taxes

 

Pursuant to certain agreements, GS&T technically and commercially manages vessels for Baltic Trading as well as provides technical management of vessels for MEP in exchange for specified fees for these services provided.  These services are performed by Genco Management (USA) Limited (“Genco (USA)”), which has elected to be taxed as a corporation for United States federal income tax purposes.  As such, Genco (USA) is subject to United States federal income tax on its worldwide net income, including the net income derived from providing these services.  Genco (USA) has entered into a cost-sharing agreement with the Company and Genco Ship Management LLC, collectively Manco, pursuant to which Genco (USA) agrees to reimburse Manco for the costs incurred by Genco (USA) for the use of Manco’s personnel and services in connection with the provision of the services for both Baltic Trading and MEP’s vessels.

 

Total revenue earned for these services during the three months ended September 30, 2012 and 2011 was $1,530 and $1,588, respectively, of which $703 and $760, respectively, eliminated upon consolidation.  After allocation of certain expenses, there was taxable income of $664 associated with these activities for the three months ended September 30, 2012.  This resulted in estimated tax expense of $299 for the three months ended September 30, 2012.  After allocation of certain expenses, there was taxable income of $668 associated with these activities for the three months ended September 30, 2011.  This resulted in income tax expense of $319 for the three months ended September 30, 2011.

 

Total revenue earned for these services during the nine months ended September 30, 2012 and 2011 was $4,575 and $4,689, respectively, of which $2,109 and $2,232, respectively, eliminated upon consolidation.  After allocation of certain expenses, there was taxable income of $1,985 associated with these activities for the nine months ended September 30, 2012.  This resulted in estimated tax expense of $892 for the nine months ended September 30, 2012.  After allocation of certain expenses, there was taxable income of $2,113 associated with these activities for the nine months ended September 30, 2011.  This resulted in income tax expense of $1,010 for the nine months ended September 30, 2011.

 

Baltic Trading is subject to income tax on its United States source income.  During the three months ended September 30, 2012 and 2011, Baltic Trading had United States source income of $200 and $452, respectively.  Baltic Trading’s United States income tax expense for the three months ended September 30, 2012 and 2011 was $4 and $9, respectively.

 

During the nine months ended September 30, 2012 and 2011, Baltic Trading had United States source income of $1,321 and $2,909, respectively.  Baltic Trading’s United States income tax expense for the nine months ended September 30, 2012 and 2011 was $26 and $31, respectively.

 

Recent accounting pronouncements

 

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (Topic 820) — Fair Value Measurement” (“ASU 2011-04”), to provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards.  ASU 2011-04 changes certain fair value measurement principles and enhances the disclosure requirements, particularly for Level 3 fair value measurements.  This standard was effective for interim and annual periods beginning after December 15, 2011 and is applied on a prospective basis.  The Company has adopted ASU 2011-04 and the impact of adoption is not material to the Company’s condensed consolidated financial statements.

 

In June 2011, the FASB issued Accounting Standards Update No. 2011-05, “Comprehensive Income (Topic 220), Presentation of Comprehensive Income” (“ASU 2011-05”), to require an entity to present the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements.  ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity.  The standard does not change the items that must be reported for other comprehensive income, how such items are measured or when they must be reclassified to net income.  This standard was effective for interim and annual periods beginning after December 15, 2011 and was to be applied retrospectively.  The FASB has deferred the requirement to present reclassification adjustments for each component of accumulate other comprehensive income in both net income and other comprehensive income.  Companies are required to either present amounts reclassified out of other comprehensive income on the face of the financial statements or disclose those amounts in the notes to the financial statements.  During the deferral period, there is no requirement to separately present or disclose the reclassification adjustments into net income.  The effective date of this deferral will be consistent with the effective date of ASU 2011-05.  The Company has adopted ASU 2011-05 and disclosed comprehensive income in our condensed consolidated statements of comprehensive (loss) income. This guidance only affects financial statement presentation and has no impact on the Company’s consolidated results of operations, financial position and cash flows.

 

SEGMENT INFORMATION
SEGMENT INFORMATION

3 - SEGMENT INFORMATION

 

The Company determines its operating segments based on the information utilized by the chief operating decision maker to assess performance.  Based on this information, the Company has two operating segments, GS&T and Baltic Trading.  Both GS&T and Baltic Trading are engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk carrier vessels.  GS&T seeks to deploy its vessels on time charters, spot market-related time charters or in vessel pools trading in the spot market and Baltic Trading seeks to deploy its vessel charters in the spot market, which represents immediate chartering of a vessel, usually for single voyages, or employing vessels on spot market-related time charters.  Segment results are evaluated based on net income (loss).  The accounting policies applied to the reportable segments are the same as those used in the preparation of the Company’s condensed consolidated financial statements.

 

The following table presents a reconciliation of total voyage revenue from external (third party) customers for the Company’s two operating segments to total consolidated voyage revenue from external customers for the Company for the three and nine months ended September 30, 2012 and 2011.

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Voyage revenue from external customers

 

 

 

 

 

 

 

 

 

GS&T

 

$

 47,312

 

$

 82,586

 

$

 154,552

 

$

 262,259

 

Baltic Trading

 

6,291

 

10,898

 

20,188

 

30,355

 

Total operating segments

 

53,603

 

93,484

 

174,740

 

292,614

 

Eliminating revenue

 

 

 

 

 

Total consolidated voyage revenue from external customers

 

$

 53,603

 

$

 93,484

 

$

 174,740

 

$

 292,614

 

 

The following table presents a reconciliation of total intersegment revenue, which eliminates upon consolidation, for the Company’s two operating segments for the three and nine months ended September 30, 2012 and 2011. The intersegment revenue noted in the following table represents revenue earned by GS&T pursuant to the management agreement entered into with Baltic Trading, which includes commercial service fees, technical service fees and sale and purchase fees, if any.

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Intersegment revenue

 

 

 

 

 

 

 

 

 

GS&T

 

$

 703

 

$

 760

 

$

 2,109

 

$

 2,232

 

Baltic Trading

 

 

 

 

 

Total operating segments

 

703

 

760

 

2,109

 

2,232

 

Eliminating revenue

 

(703

)

(760

)

(2,109

)

(2,232

)

Total consolidated intersegment revenue

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

The following table presents a reconciliation of total net (loss) income for the Company’s two operating segments to total consolidated net (loss) income for the three and nine months ended September 30, 2012 and 2011. The eliminating net loss noted in the following table consists of the elimination of intercompany transactions between GS&T and Baltic Trading, as well as dividends received by GS&T from Baltic Trading for its Class B shares of Baltic Trading.

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Net (loss) income

 

 

 

 

 

 

 

 

 

GS&T

 

$

 (36,969

)

$

 2,144

 

$

 (94,779

)

$

 27,422

 

Baltic Trading

 

(4,822

)

(194

)

(12,942

)

(2,241

)

Total operating segments

 

(41,791

)

1,950

 

(107,721

)

25,181

 

Eliminating net loss

 

(246

)

(533

)

(1,194

)

(1,763

)

Total consolidated net (loss) income

 

$

 (42,037

)

$

 1,417

 

$

 (108,915

)

$

 23,418

 

 

The following table presents a reconciliation of total assets for the Company’s two operating segments to total consolidated assets as of September 30, 2012 and December 31, 2011. The eliminating assets noted in the following table consist of the elimination of intercompany transactions resulting from the capitalization of fees paid to GS&T by Baltic Trading as vessel assets, including related accumulated depreciation, as well as the outstanding receivable balance due to GS&T from Baltic Trading as of September 30, 2012 and December 31, 2011.

 

 

 

September 30,

2012

 

December 31,
2011

 

Total assets

 

 

 

 

 

GS&T

 

$

 2,529,964

 

$

 2,737,988

 

Baltic Trading

 

368,127

 

384,955

 

Total operating segments

 

2,898,091

 

3,122,943

 

Eliminating assets

 

(3,518

)

(3,666

)

Total consolidated assets

 

$

 2,894,573

 

$

 3,119,277

 

 

CASH FLOW INFORMATION
CASH FLOW INFORMATION

4 - CASH FLOW INFORMATION

 

As of September 30, 2012 and December 31, 2011, the Company had five and eight interest rate swaps, respectively, which are described and discussed in Note 11 — Interest Rate Swap Agreements. The fair value of all five of the swaps is in a liability position of $18,870, $609 of which was classified within current liabilities, as of September 30, 2012.  At December 31, 2011, the eight swaps were in a liability position of $25,340, $1,686 of which was classified within current liabilities.

 

For the nine months ended September 30, 2012, the Company had non-cash investing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in accounts payable and accrued expenses consisting of $31 for the purchase of vessels and $77 for the purchase of other fixed assets.  Additionally, for the nine months ended September 30, 2012, the Company had non-cash financing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in accounts payable and accrued expenses and long-term interest payable consisting of $246 and $13,199, respectively, associated with deferred financing fees.

 

For the nine months ended September 30, 2011, the Company had non-cash investing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in accounts payable and accrued expenses consisting of $804 for the purchase of vessels, $26 associated with deposits on vessels and $1,305 for the purchase of other fixed assets. Additionally, for the nine months ended September 30, 2011, the Company had non-cash investing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in prepaid expenses and other current assets as of September 30, 2011 consisting of $15 interest receivable associated with deposits on vessels.

 

For the nine months ended September 30, 2011, the Company made a reclassification of $10,354 from deposits on vessels to vessels, net of accumulated depreciation, due to the completion of the purchase of the Genco Rhone, Genco Avra and Genco Mare.

 

During the nine months ended September 30, 2012 and 2011, cash paid for interest, net of amounts capitalized and including bond coupon interest paid, was $61,632 and $61,642, respectively.

 

During the nine months ended September 30, 2012 and 2011, cash paid for estimated income taxes was $926 and $1,010, respectively.

 

On May 12, 2011, the Company made grants of nonvested common stock under the Genco Shipping & Trading Limited 2005 Equity Incentive Plan in the amount of 15,000 shares in the aggregate to directors of the Company.  The fair value of such nonvested stock was $120. These shares vested on May 17, 2012.  On May 12, 2011, Baltic Trading made grants of nonvested common stock in the amount of 12,500 shares to directors of Baltic Trading.  The fair value of such nonvested stock was $87.  These shares vested on May 17, 2012.

 

On May 17, 2012, the Company made grants of nonvested common stock under the Genco Shipping & Trading Limited 2005 Equity Incentive Plan in the amount of 15,000 shares in the aggregate to directors of the Company.  The fair value of such nonvested stock was $53.  On May 17, 2012, Baltic Trading made grants of nonvested common stock in the amount of 12,500 shares to directors of Baltic Trading.  The fair value of such nonvested stock was $48.

 

VESSEL ACQUISITIONS AND DISPOSITIONS
VESSEL ACQUISITIONS AND DISPOSITIONS

5 - VESSEL ACQUISITIONS AND DISPOSITIONS

 

On March 29, 2011, GS&T took delivery of the Genco Rhone, a 58,000 dwt Supramax vessel, which was purchased from Bourbon S.A. (“Bourbon”) pursuant to the Master Agreement dated June 24, 2010 between GS&T and Bourbon.  The Genco Rhone was the last of 13 vessels to be acquired and retained by GS&T under such agreements.  GS&T paid a total purchase price of approximately $35.7 million for the Genco Rhone which was financed with available cash, including proceeds from its concurrent offerings of common stock and 5.00% Convertible Senior Notes due August 15, 2015, which were completed on July 27, 2010.  The Company drew down from the $253 million term loan facility to refund $21.5 million associated with the purchase of the Genco Rhone on March 30, 2011.

 

On May 12, 2011, July 20, 2011 and November 10, 2011, GS&T took delivery of the Genco Avra, Genco Mare and Genco Spirit, respectively.  These vessels are approximately 34,400 dwt Handysize newbuildings which were purchased from companies within the Metrostar group of companies pursuant to the agreement dated June 3, 2010 to acquire five Handysize vessels.  These three vessels were the last vessels delivered pursuant to the aforementioned agreement.  GS&T utilized available cash of $29.8 million, as well as $60.0 million under its $100 million term loan facility, to pay the remaining balance of $89.8 million.

 

Refer to Note 1 — General Information for a listing of the vessel delivery dates for the vessel acquisitions discussed herein.

 

The Genco Avra and Genco Spirit had existing below market time charters at the time of acquisition.  GS&T recorded a liability for time charters acquired of $372 during the second quarter of 2011 upon the delivery of the Genco Avra to its charterer and $205 during the fourth quarter of 2011 upon the delivery of the Genco Spirit to its charterer.  Below market time charters, including those acquired during previous periods, were amortized as an increase to voyage revenue in the amount of $187 and $463 for the three months ended September 30, 2012 and 2011, respectively, and $558 and $1,432 for the nine months ended September 30, 2012 and 2011, respectively.

 

Capitalized interest associated with newbuilding contracts for the three months ended September 30, 2012 and 2011 was $0 and $33, respectively.  Capitalized interest associated with newbuilding contracts for the nine months ended September 30, 2012 and 2011 was $0 and $165, respectively.

 

INVESTMENTS
INVESTMENTS

6 - INVESTMENTS

 

The Company holds an investment in the capital stock of Jinhui Shipping and Transportation Limited (“Jinhui”).  Jinhui is a drybulk shipping owner and operator focused on the Supramax segment of drybulk shipping.  This investment is designated as Available For Sale (“AFS”) and is reported at fair value, with unrealized gains and losses recorded in shareholders’ equity as a component of accumulated other comprehensive loss (“AOCI”).  At September 30, 2012 and December 31, 2011, the Company held 16,335,100 shares of Jinhui capital stock, which is recorded at its fair value of $23,825 and $24,468, respectively, based on the closing price on September 28, 2012 and December 30, 2011, respectively.

 

The Company reviews the investment in Jinhui for other than temporary impairment on a quarterly basis.  There were no impairment charges recognized for the three and nine months ended September 30, 2012 and 2011.

 

The unrealized gain on the Jinhui capital stock remains a component of AOCI, since this investment is designated as an AFS security.

 

Refer to Note 12 — Accumulated Other Comprehensive Loss for a breakdown of the components of AOCI.

 

NET (LOSS) INCOME PER COMMON SHARE
NET (LOSS) INCOME PER COMMON SHARE

7 - NET (LOSS) INCOME PER COMMON SHARE

 

The computation of basic net (loss) income per share is based on the weighted-average number of common shares outstanding during the year. The computation of diluted net loss (income) per share assumes the vesting of nonvested stock awards (refer to Note 20 — Nonvested Stock Awards), for which the assumed proceeds upon vesting are deemed to be the amount of compensation cost attributable to future services and are not yet recognized using the treasury stock method, to the extent dilutive.  Of the 935,287 nonvested shares outstanding at September 30, 2012 (refer to Note 20 — Nonvested Stock Awards), all are anti-dilutive.  The Company’s diluted net (loss) income per share will also reflect the assumed conversion under the Company’s convertible debt if the impact is dilutive under the “if converted” method. The impact of the shares convertible under the Company’s convertible notes is excluded from the computation of diluted net (loss) income per share when interest expense per common share obtainable upon conversion is greater than basic earnings per share.

 

The components of the denominator for the calculation of basic net (loss) income per share and diluted net (loss) income per share are as follows:

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding, basic:

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, basic

 

42,885,810

 

35,157,110

 

41,290,719

 

35,149,912

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding, diluted:

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, basic

 

42,885,810

 

35,157,110

 

41,290,719

 

35,149,912

 

 

 

 

 

 

 

 

 

 

 

Dilutive effect of convertible notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dilutive effect of restricted stock awards

 

 

55,730

 

 

62,129

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, diluted

 

42,855,810

 

35,212,840

 

41,290,719

 

35,212,041

 

 

The following table sets forth a reconciliation of the net (loss) income attributable to GS&T and the net (loss) income attributable to GS&T for diluted earnings per share under the “if-converted” method:

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to GS&T

 

$

 (38,449

)

$

 1,562

 

$

 (99,289

)

$

 25,080

 

 

 

 

 

 

 

 

 

 

 

Interest expense related to convertible notes, if dilutive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to GS&T for the computation of diluted net (loss) income per share

 

$

 (38,449

)

$

 1,562

 

$

 (99,289

)

$

 25,080

 

 

RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS

8 - RELATED PARTY TRANSACTIONS

 

The following represent related party transactions reflected in these condensed consolidated financial statements:

 

The Company makes available employees performing internal audit services to General Maritime Corporation (“GMC”), where the Company’s Chairman, Peter C. Georgiopoulos, also serves as Chairman of the Board.  For the nine months ended September 30, 2012 and 2011, the Company invoiced $140 and $136, respectively, to GMC, which includes time associated with such internal audit services and other expenditures.  Additionally, during the nine months ended September 30, 2012 and 2011, the Company incurred travel and other expenditures totaling $45 and $168, respectively, reimbursable to GMC or its service provider.  At September 30, 2012, the amount due to the Company from GMC was $21.  At December 31, 2011, the amount due to the Company from GMC was $114, of which $90 was reserved for pursuant to GMC’s bankruptcy proceedings.

 

During the nine months ended September 30, 2012 and 2011, the Company incurred legal services (primarily in connection with vessel acquisitions) aggregating $16 and $38, respectively, from Constantine Georgiopoulos, the father of Peter C. Georgiopoulos, Chairman of the Board.  At September 30, 2012 and December 31, 2011, $16 and $29, respectively, was outstanding to Constantine Georgiopoulos.

 

During the nine months ended September 30, 2012 and 2011, the Company utilized the services of North Star Maritime, Inc. (“NSM”) which is owned and operated by one of GS&T’s directors, Rear Admiral Robert C. North, USCG (ret.).  NSM, a marine industry consulting firm, specializes in international and domestic maritime safety, security and environmental protection issues.  NSM billed $0 and $2 for services rendered during the nine months ended September 30, 2012 and 2011.  There are no amounts due to NSM at September 30, 2012 and December 31, 2011.

 

GS&T and Baltic Trading have entered into agreements with Aegean Marine Petroleum Network, Inc. (“Aegean”) to purchase lubricating oils for certain vessels in their fleets.  Peter C. Georgiopoulos, Chairman of the Board of the Company, is Chairman of the Board of Aegean.  During the nine months ended September 30, 2012 and 2011, Aegean supplied lubricating oils to the Company’s vessels aggregating $1,170 and $1,342, respectively.  At September 30, 2012 and December 31, 2011, $98 and $408 remained outstanding, respectively.

 

During the nine months ended September 30, 2012 and 2011, the Company invoiced MEP for technical services provided and expenses paid on MEP’s behalf aggregating $2,541 and $2,514, respectively.  MEP is managed by a company owned by Peter C. Georgiopoulos, Chairman of the Board.  At September 30, 2012 and December 31, 2011, $3 and $7, respectively, was due to the Company from MEP.  Total service revenue earned by the Company for technical service provided to MEP for the nine months ended September 30, 2012 and 2011 was $2,466 and $2,457, respectively.

 

LONG-TERM DEBT
LONG-TERM DEBT

9 - LONG-TERM DEBT

 

Long-term debt consists of the following:

 

 

 

September 30,

2012

 

December 31,

2011

 

 

 

 

 

 

 

2007 Credit Facility

 

$

 1,055,912

 

$

 1,174,500

 

$100 Million Term Loan Facility

 

75,484

 

90,869

 

$253 Million Term Loan Facility

 

180,793

 

221,393

 

2010 Baltic Trading Credit Facility

 

101,250

 

101,250

 

Less: Current portion

 

 

(185,077

)

 

 

 

 

 

 

Long-term debt

 

$

 1,413,439

 

$

 1,402,935

 

 

August 2012 Credit Facility Agreements

 

On August 1, 2012, the Company entered into agreements (the “August 2012 Agreements”) to amend or waive certain provisions of the agreements for the 2007 Credit Facility, $100 Million Term Loan Facility and the $253 Million Term Loan Facility (as defined below).  The agreements implement, among other things, the following:

 

·                  The current waiver of the Company’s compliance with its existing maximum leverage ratio covenant and minimum permitted consolidated interest ratio covenant that commenced on October 1, 2011 and ends on and includes March 31, 2013 has been extended to end on and include December 31, 2013 (which we refer to as the extended waiver period).

 

·                  Scheduled amortization payments through and including the quarter ending December 31, 2013 have been deferred until the final payment at maturity under the 2007 Credit Facility and prepaid under the other two credit facilities.  The next scheduled amortization payments under these facilities will be due in the first quarter of 2014 in the aggregate principal amount of $55,193.

 

·                  Commencing September 30, 2012, the Company is to repay the 2007 Credit Facility on a quarterly basis using excess cash, defined as the balance over $100,000 in the Company’s and certain of its subsidiaries’ accounts pledged under the 2007 Credit Facility.   Of such repayments, 25% will be allocated to the final payment at maturity, and 75% will be applied entirely against each successive scheduled mandatory principal repayment beginning with the payment due March 31, 2014.  Certain other mandatory repayments under the existing terms of this facility as well as voluntary prepayments will be applied in the same manner.  These obligations continue until the later of December 31, 2013 and the date on which the appraised value of certain mortgaged vessels is equal to at least 100% of the aggregate principal amount of the Company’s loans, letters of credit and certain hedge obligations under the 2007 Credit Facility.

 

·                  The Company and its subsidiaries (other than Baltic Trading and its subsidiaries) will not increase the amount of principal indebtedness currently outstanding under each of its three credit agreements or change their maturity dates.

 

·                  Indebtedness that the Company and its subsidiaries (other than Baltic Trading and its subsidiaries) may incur in connection with vessel acquisitions will be limited to 60% of the lesser of the vessel’s acquisition cost and fair market value.  Any newly acquired vessel will subject to a security interest under the 2007 Credit Facility.

 

·                  The applicable margin over LIBOR payable on the principal amount outstanding under the 2007 Credit Facility increased from 2.0% to 3.0% per annum.

 

·                  The minimum cash balance required under the 2007 Credit Facility increased from $500 to $750 per vessel mortgaged under the 2007 Credit Facility.

 

·                  The Company agreed to grant additional security for its obligations under the 2007 Credit Facility, consisting of a pledge of the Class B Stock of Baltic Trading held by Genco Investments LLC and a second priority security interest in vessels pledged under its other two credit facilities or in connection with any new indebtedness (excluding in each case vessels owned by Baltic Trading and its subsidiaries).

 

·                  Consenting lenders under each of the three credit facilities received an upfront fee of 0.25% on the amount of outstanding loans.

 

As required under the August 2012 Agreements, the Company prepaid $57,893 under its 2007 Credit Facility, $30,450 under its $253 Million Term Loan Facility, and $11,538 under its $100 Million Term Loan Facility on August 1, 2012.  The prepayment under the 2007 Credit Facility was applied to the final payment due under the facility.  The prepayments under the other two facilities were applied in order of maturity and fulfilled all scheduled amortization payments through December 31, 2013 under these facilities.   In addition, lenders under the 2007 Credit Facility will receive a fee equal to 1.25% of the principal amount outstanding following such prepayment, or $13,199, on the earlier date of the maturity date of this facility or the date on which all obligations under this facility have been paid in full.  The $13,199 has been recorded in the condensed consolidated balance sheet at September 30, 2012 as Long-term interest payable.  The agreements are subject to completion of certain post-closing actions, including effecting a second priority security interest in certain of the Company’s vessels as described above.

 

2007 Credit Facility

 

On July 20, 2007, the Company entered into a credit facility with DnB NOR Bank ASA (as amended, the “2007 Credit Facility”). The maximum amount that may be borrowed under the 2007 Credit Facility at September 30, 2012 is $1,055,912.  As of September 30, 2012, the Company has utilized its maximum borrowing capacity under the 2007 Credit Facility.

 

The collateral maintenance financial covenant, maximum leverage ratio covenant and minimum permitted consolidated interest ratio covenants are currently waived for the periods ending on and including December 31, 2013 pursuant to the August 2012 Agreements and the Company’s cash dividends and share repurchases have been suspended until the collateral maintenance financial covenant can be satisfied.

 

Pursuant to the amendment to the 2007 Credit Facility which was entered into on December 21, 2011, the Company was subject to a facility fee of 2.0% per annum on the average daily outstanding principal amount of the loans outstanding, payable quarterly in arrears, which was subject to a reduction to 1.0% if the Company consummated an equity offering resulting in an aggregate amount of $50,000 of gross proceeds.  On February 28, 2012, the Company completed an equity offering of 7,500,000 shares which resulted in gross proceeds of $53,250.  As such, effective February 28, 2012, the facility fee was reduced to 1.0%.

 

As of September 30, 2012, the Company believes it is in compliance with all of the financial covenants under its 2007 Credit Facility, as amended.

 

At September 30, 2012, there were no letters of credit issued under the 2007 Credit Facility.

 

$100 Million Term Loan Facility

 

On August 12, 2010, the Company entered into the $100,000 secured term loan facility (“$100 Million Term Loan Facility”). As of September 30, 2012, the Company has utilized its maximum borrowing capacity as $100,000 of drawdowns have been made. The Company has used the $100 Million Term Loan Facility to fund or refund the Company a portion of the purchase price of the acquisition of five vessels from companies within the Metrostar group of companies.  As of September 30, 2012, there was no availability under the $100 Million Term Loan Facility.

 

Pursuant to the amendments to the $100 Million Term Loan Facility that were entered into on December 21, 2011 and August 1, 2012, the maximum leverage ratio covenant and the minimum permitted consolidated interest ratio covenant are currently waived for the periods ending on and including December 31, 2013.

 

As of September 30, 2012, the Company believes it is in compliance with all of the financial covenants under the $100 Million Term Loan Facility, as amended.

 

$253 Million Term Loan Facility

 

On August 20, 2010, the Company entered into the $253,000 senior secured term loan facility (“$253 Million Term Loan Facility”).  As of September 30, 2012, the Company has utilized its maximum borrowing capacity as $253,000 of drawdowns have been made to fund or refund to the Company a portion of the purchase price of the 13 vessels purchased from Bourbon SA during the third quarter of 2010 and first quarter of 2011.  As of September 30, 2012, there was no availability under the $253 Million Term Loan Facility.

 

Pursuant to the amendments to the $253 Million Term Loan Facility that were entered into on December 21, 2011 and August 1, 2012, the maximum leverage ratio covenant and the minimum permitted consolidated interest ratio covenant are currently waived for the periods ending on and including December 31, 2013.

 

As of September 30, 2012, the Company believes it is in compliance with all of the financial covenants under the $253 Million Term Loan Facility, as amended.

 

2010 Baltic Trading Credit Facility

 

On April 16, 2010, Baltic Trading entered into a $100,000 senior secured revolving credit facility with Nordea Bank Finland plc, acting through its New York branch (as amended, the “2010 Baltic Trading Credit Facility”).  An amendment to the 2010 Baltic Trading Credit Facility was entered into by Baltic Trading effective November 30, 2010.  Among other things, this amendment increased the commitment amount of the 2010 Baltic Trading Credit Facility from $100,000 to $150,000.  As of September 30, 2012, total available working capital borrowings were $23,500 as $1,500 was drawn down during 2010 for working capital purposes.  Pursuant to the amended 2010 Baltic Trading Credit Facility, the total commitment of $150,000 will be reduced in 11 consecutive semi-annual reductions of $5,000 which commenced on the six month anniversary of the effective date, or May 31, 2011.  As of September 30, 2012, $33,750 remained available under the 2010 Credit Facility as the total commitment was reduced to $135,000 on May 31, 2012.

 

As of September 30, 2012, the Company believes Baltic Trading is in compliance with all of the financial covenants under the 2010 Baltic Trading Credit Facility.

 

Interest rates

 

The following tables sets forth the effective interest rate associated with the interest expense for the Company’s debt facilities noted above, including the rate differential between the pay fixed, receive variable rate on the interest rate swap agreements that were in effect (refer to Note 11 — Interest Rate Swap Agreements), combined, the cost associated with unused commitment fees as well as the facility fee for the 2007 Credit Facility which was reduced from 2.0% to 1.0% on February 28, 2012 as noted above. Additionally, it includes the range of interest rates on the debt, excluding the impact of swaps and unused commitment fees:

 

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Effective Interest Rate

 

4.65

%

4.36

%

4.60

%

4.41

%

Range of Interest Rates (excluding impact of swaps and unused commitment fees)

 

3.22% to 4.50

%

2.25% to 3.33

%

3.22% to 4.63

%

2.19% to 3.33

%

 

CONVERTIBLE SENIOR NOTES
CONVERTIBLE SENIOR NOTES

10 - CONVERTIBLE SENIOR NOTES

 

The Company issued $125,000 of 5.0% Convertible Senior Notes on July 27, 2010 (the “2010 Notes”).  The Indenture includes customary agreements and covenants by the Company, including with respect to events of default.

 

The following tables provide additional information about the Company’s 2010 Notes:

 

 

 

September 30,

2012

 

December 31,
2011

 

Carrying amount of the equity component (additional paid-in capital)

 

$

 24,375

 

$

 24,375

 

Principal amount of the 2010 Notes

 

125,000

 

125,000

 

Unamortized discount of the liability component

 

15,274

 

18,619

 

Net carrying amount of the liability component

 

109,726

 

106,381

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Effective interest rate on liability component

 

10.0

%

10.0

%

10.0

%

10.0

%

Cash interest expense recognized

 

$

 1,580

 

$

 1,584

 

$

 4,696

 

$

 4,677

 

Non-cash interest expense recognized

 

1,158

 

1,046

 

3,345

 

2,999

 

Non-cash deferred financing amortization costs included in interest expense

 

181

 

181

 

540

 

538

 

 

The remaining period over which the unamortized discount will be recognized is 2.9 years. As of September 30, 2012, the if-converted value of the 2010 Notes does not exceed their principal amount.

 

Due to the 2015 maturity of the 2010 Notes and the Company’s intent to hold the 2010 Notes until maturity, the 2010 Notes have been classified as a noncurrent liability on the condensed consolidated balance sheets as of September 30, 2012 and December 31, 2011.

 

INTEREST RATE SWAP AGREEMENTS
INTEREST RATE SWAP AGREEMENTS

11 - INTEREST RATE SWAP AGREEMENTS

 

As of September 30, 2012 and December 31, 2011, the Company had five and eight interest rate swap agreements outstanding, respectively, with DnB NOR Bank ASA to manage interest costs and the risk associated with changing interest rates related to the Company’s 2007 Credit Facility. The total notional principal amount of the swaps at September 30, 2012 and December 31, 2011 was $356,233 and $606,233, respectively, and the swaps have specified rates and durations.

 

The following table summarizes the interest rate swaps designated as cash flow hedges that were in place as of September 30, 2012 and December 31, 2011:

 

 

 

 

 

 

 

 

 

September 30,
2012

 

December 31,
2011

 

Interest Rate Swap Detail

 

Notional

 

Notional

 

Trade

 

Fixed

 

Start Date

 

End Date

 

Amount

 

Amount

 

Date

 

Rate

 

of Swap

 

of Swap

 

Outstanding

 

Outstanding

 

9/6/05

 

4.485

%

9/14/05

 

7/29/15

 

$

106,233

 

$

106,233

 

3/29/06

 

5.25

%

1/2/07

 

1/1/14

 

50,000

 

50,000

 

3/24/06

 

5.075

%

1/2/08

 

1/2/13

 

50,000

 

50,000

 

8/9/07

 

5.07

%

1/2/08

 

1/3/12

 

 

100,000

 

8/16/07

 

4.985

%

3/31/08

 

3/31/12

 

 

50,000

 

8/16/07

 

5.04

%

3/31/08

 

3/31/12

 

 

100,000

 

1/9/09

 

2.05

%

1/22/09

 

1/22/14

 

100,000

 

100,000

 

2/11/09

 

2.45

%

2/23/09

 

2/23/14

 

50,000

 

50,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

356,233

 

$

606,233

 

 

The following table summarizes the derivative asset and liability balances at September 30, 2012 and December 31, 2011:

 

 

 

Asset Derivatives

 

Liability Derivatives

 

 

 

Balance

 

Fair Value

 

Balance

 

Fair Value

 

 

 

Sheet
Location

 

September 30,
2012

 

December
31, 2011

 

Sheet
Location

 

September 30,
2012

 

December
31, 2011

 

Derivatives designated as hedging instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate contracts

 

Fair value of derivative instruments (Current Assets)

 

$

 

$

 

Fair value of derivative instruments (Current Liabilities)

 

$

609

 

$

1,686

 

Interest rate contracts

 

Fair value of derivative instruments (Noncurrent Assets)

 

 

 

Fair value of derivative instruments (Noncurrent Liabilities)

 

18,261

 

23,654

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total derivatives designated as hedging instruments

 

 

 

 

 

 

 

18,870

 

25,340

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivatives

 

 

 

$

 

$

 

 

 

$

18,870

 

$

25,340

 

 

The following tables present the impact of derivative instruments and their location within the Condensed Consolidated Statement of Operations:

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Three-Month Period Ended September 30, 2012

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2012

 

Portion)

 

2012

 

Portion)

 

2012

 

Interest rate contracts

 

$

 (1,434

)

Interest Expense

 

$

 2,959

 

Other Income (Expense)

 

$

 30

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Three-Month Period Ended September 30, 2011

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2011

 

Portion)

 

2011

 

Portion)

 

2011

 

Interest rate contracts

 

$

 (5,021

)

Interest Expense

 

$

 7,438

 

Other Income (Expense)

 

$

 18

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Nine-Month Period Ended September 30, 2012

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2012

 

Portion)

 

2012

 

Portion)

 

2012

 

Interest rate contracts

 

$

 (3,999

)

Interest Expense

 

$

 10,392

 

Other Income (Expense)

 

$

 76

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Nine-Month Period Ended September 30, 2011

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2011

 

Portion)

 

2011

 

Portion)

 

2011

 

Interest rate contracts

 

$

 (11,705

)

Interest Expense

 

$

 22,038

 

Other Income (Expense)

 

$

 38

 

 

At September 30, 2012, ($10,082) of AOCI is expected to be reclassified into interest expense over the next 12 months associated with interest rate derivatives.

 

The Company is required to provide collateral in the form of vessel assets to support the interest rate swap agreements, excluding vessel assets of Baltic Trading.  At September 30, 2012, the Company’s 35 vessels mortgaged under the 2007 Credit Facility served as collateral in the aggregate amount of $100,000.

 

ACCUMULATED OTHER COMPREHENSIVE LOSS
ACCUMULATED OTHER COMPREHENSIVE LOSS

12 - ACCUMULATED OTHER COMPREHENSIVE LOSS

 

The components of AOCI included in the accompanying condensed consolidated balance sheets consist of net unrealized gain (loss) on cash flow hedges and net unrealized gain from investments in Jinhui stock as of September 30, 2012 and December 31, 2011.

 

 

 

Net Unrealized
Gain (Loss) on
Cash Flow
Hedges

 

Unrealized
Gain
on
Investments

 

AOCI

 

AOCI — January 1, 2012

 

$

 (25,245

)

$

 7,696

 

$

 (17,549

)

Change in unrealized gain on investments

 

 

 

(643

)

(643

)

Unrealized gain on cash flow hedges

 

6,394

 

 

 

6,394

 

AOCI — September 30, 2012

 

$

 (18,851

)

$

 7,053

 

$

 (11,798

)

 

FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF FINANCIAL INSTRUMENTS

13 - FAIR VALUE OF FINANCIAL INSTRUMENTS

 

The fair values and carrying values of the Company’s financial instruments at September 30, 2012 and December 31, 2011 which are required to be disclosed at fair value, but not recorded at fair value, are noted below.

 

 

 

September 30, 2012

 

December 31, 2011

 

 

 

Carrying
Value

 

Fair Value

 

Carrying
Value

 

Fair Value

 

Cash and cash equivalents

 

$

 87,778

 

$

 87,778

 

$

 227,968

 

$

 227,968

 

Restricted cash

 

10,150

 

10,150

 

9,750

 

9,750

 

Floating rate debt

 

1,413,439

 

1,413,439

 

1,588,012

 

1,588,012

 

2010 Notes

 

109,726

 

48,750

 

106,381

 

80,000

 

 

The fair value of the floating rate debt under the 2007 Credit Facility, $100 Million Term Loan Facility, $253 Million Term Loan Facility and the 2010 Baltic Trading Credit Facility are based on management’s estimate of rates the Company has recently obtained on August 1, 2012 when the Company entered into agreements to amend or waive certain provisions of the 2007 Credit Facility, $100 Million Term Loan Facility and the $253 Million Term Loan Facility.  Additionally, the Company considers its creditworthiness in determining the fair value of floating rate debt under the credit facilities.  The carrying value approximates the fair market value for these floating rate loans.  The fair value of the convertible senior notes payable represents the market value based on recent transactions of the 2010 Notes at September 30, 2012 and December 31, 2011 without bifurcating the value of the conversion option.  The fair value of the interest rate swaps is the estimated amount the Company would receive to terminate the swap agreements at the reporting date, taking into account current interest rates and the creditworthiness of both the swap counterparty and the Company.  The carrying amounts of the Company’s other financial instruments at September 30, 2012 and December 31, 2011 (principally Due from charterers and Accounts payable and accrued expenses), approximate fair values because of the relatively short maturity of these instruments.

 

Accounting Standards Codification Subtopic 820-10, “Fair Value Measurements & Disclosures” (“ASC 820-10”), applies to all assets and liabilities that are being measured and reported on a fair value basis.  This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The fair value framework requires the categorization of assets and liabilities into three levels based upon the assumption (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows:

 

·                  Level 1—Valuations based on quoted prices in active markets for identical instruments that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

 

·                  Level 2—Valuations based on quoted prices in active markets for instruments that are similar, or quoted prices in markets that are not active for identical or similar instruments, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

 

·                  Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

 

As of September 30, 2012 and December 31, 2011, the fair values of the Company’s financial assets and liabilities are categorized as follows:

 

 

 

September 30, 2012

 

 

 

Total

 

Quoted
market
prices in
active
markets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Investments

 

$

 23,825

 

$

 23,825

 

$

 —

 

Derivative instruments — liability position

 

18,870

 

 

18,870

 

 

 

 

December 31, 2011

 

 

 

Total

 

Quoted
market
prices in
active
markets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Investments

 

$

 24,468

 

$

 24,468

 

$

 —

 

Derivative instruments — liability position

 

25,340

 

 

25,340

 

 

The Company holds an investment in the capital stock of Jinhui, which is classified as a long-term investment.  The stock of Jinhui is publicly traded on the Oslo Stock Exchange and is considered a Level 1 item.  The Company’s interest rate derivative instruments are pay-fixed, receive-variable interest rate swaps based on LIBOR.  The Company has elected to use the income approach to value the derivatives, using observable Level 2 market inputs at measurement date and standard valuation techniques to convert future amounts to a single present amount assuming that participants are motivated, but not compelled to transact.  Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets (specifically futures contracts on LIBOR for the first two years) and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR cash and swap rates and credit risk at commonly quoted intervals).  Mid-market pricing is used as a practical expedient for fair value measurements.  Refer to Note 11 — Interest Rate Swap Agreements for further information regarding the Company’s interest rate swap agreements.  ASC 820-10 states that the fair value measurement of an asset or liability must reflect the nonperformance risk of the entity and the counterparty. Therefore, the impact of the counterparty’s creditworthiness when in an asset position and the Company’s creditworthiness when in a liability position has also been factored into the fair value measurement of the derivative instruments in an asset or liability position and did not have a material impact on the fair value of these derivative instruments.  As of September 30, 2012, both the counterparty and the Company are expected to continue to perform under the contractual terms of the instruments. Cash and cash equivalents and restricted cash are considered Level 1 items as they represent liquid assets with short-term maturities. Floating rate debt is considered to be a Level 2 item as the Company considers the estimate of rates it could obtain for similar debt. The 2010 Notes are publicly traded in the over-the-counter market; however they are not considered to be actively traded. As such, the 2010 Notes are considered to be a Level 2 item.

 

PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS
PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS

14 - PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS

 

Prepaid expenses and other current assets consist of the following:

 

 

 

September 30,

2012

 

December 31,

2011

 

Lubricant inventory, fuel oil and diesel oil inventory and other stores

 

$

 10,321

 

$

 10,376

 

Prepaid items

 

4,621

 

5,514

 

Insurance receivable

 

860

 

1,025

 

Other

 

1,218

 

794

 

Total prepaid expenses and other current assets

 

$

 17,020

 

$

 17,709

 

 

Other noncurrent assets in the amount of $514 at September 30, 2012 and December 31, 2011 represent the security deposit related to the operating lease entered into effective April 4, 2011. Refer to Note 19 — Commitments and Contingencies for further information related to the lease agreement.

 

OTHER ASSETS, NET
OTHER ASSETS, NET

15 - OTHER ASSETS, NET

 

Other assets consist of deferred financing costs, which include fees, commissions and legal expenses associated with securing loan facilities and other debt offerings and amending existing loan facilities.  Total net deferred financing costs consist of the following as of September 30, 2012 and December 31, 2011:

 

 

 

September 30,

2012

 

December 31,

2011

 

 

 

 

 

 

 

2007 Credit Facility

 

$

 29,923

 

$

 13,189

 

$100 Million Term Loan Facility

 

1,822

 

1,578

 

$253 Million Term Loan Facility

 

4,802

 

4,113

 

2010 Notes

 

3,637

 

3,637

 

2010 Baltic Trading Credit Facility

 

3,027

 

3,027

 

Total deferred financing costs

 

43,211

 

25,544

 

Less: accumulated amortization

 

11,304

 

7,749

 

Total

 

$

 31,907

 

$

 17,795

 

 

Amortization expense for deferred financing costs for the three months ended September 30, 2012 and 2011 was $1,596 and $796, respectively.  Amortization expense for deferred financing costs for the nine months ended September 30, 2012 and 2011 was $3,555 and $2,368, respectively.  This amortization expense is recorded as a component of interest expense in the Condensed Consolidated Statements of Operations.

 

FIXED ASSETS
FIXED ASSETS

16 - FIXED ASSETS

 

Fixed assets consist of the following:

 

 

 

September 30,

2012

 

December 31,

2011

 

Fixed assets, at cost:

 

 

 

 

 

Vessel equipment

 

$

 2,973

 

$

 2,720

 

Leasehold improvements

 

3,823

 

3,664

 

Furniture and fixtures

 

997

 

997

 

Computer equipment

 

686

 

632

 

Total costs

 

8,479

 

8,013

 

Less: accumulated depreciation and amortization

 

3,077

 

2,422

 

Total

 

$

 5,402

 

$

 5,591

 

 

Depreciation and amortization expense for fixed assets for the three months ended September 30, 2012 and 2011 was $230 and $124, respectively.  Depreciation and amortization expense for fixed assets for the nine months ended September 30, 2012 and 2011 was $655 and $372, respectively.

 

ACCOUNTS PAYABLE AND ACCRUED EXPENSES
ACCOUNTS PAYABLE AND ACCRUED EXPENSES

17 — ACCOUNTS PAYABLE AND ACCRUED EXPENSES

 

Accounts payable and accrued expenses consist of the following:

 

 

 

September 30,

2012

 

December 31,

2011

 

Accounts payable

 

$

 3,691

 

$

 5,047

 

Accrued general and administrative expenses

 

10,115

 

14,275

 

Accrued vessel operating expenses

 

11,344

 

11,390

 

Total

 

$

 25,150

 

$

 30,712

 

 

REVENUE FROM TIME CHARTERS
REVENUE FROM TIME CHARTERS

18 - REVENUE FROM TIME CHARTERS

 

Total voyage revenue earned on time charters, including revenue earned in vessel pools and spot market-related time charters, for the three months ended September 30, 2012 and 2011 was $53,603 and $93,484, respectively, and for the nine months ended September 30, 2012 and 2011 was $174,740 and $292,614, respectively.  Included in revenues for the three months ended September 30, 2012 and 2011 was profit sharing revenue of $0 and $1, respectively.  Additionally, included in revenues for the nine months ended September 30, 2012 and 2011 was profit sharing revenue of $0 and $121, respectively.  Future minimum time charter revenue, based on vessels committed to noncancelable time charter contracts as of November 1, 2012 is expected to be $11,480 for the remainder of 2012, $15,405 during 2013 and $3,512 during 2014, assuming off-hire due to any scheduled drydocking and that no additional off-hire time is incurred.  For most drydockings, the Company assumes twenty days of offhire.  Future minimum revenue excludes revenue earned for the five vessels currently in pool arrangements, vessels that are currently on or will be on spot market-related time charters, as spot rates cannot be estimated, as well as profit sharing revenue.

 

COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES

19 - COMMITMENTS AND CONTINGENCIES

 

In September 2005, the Company entered into a 15-year lease for office space in New York, New York for which there was a free rental period from September 1, 2005 to July 31, 2006.  On January 6, 2012, the Company ceased the use of this space and as such has recorded, during the three and nine months ended September 30, 2012, net rent expense of $255 and $826, respectively, representing the present value of the Company’s estimated remaining rent expense for the duration of the lease after taking into account estimated future sublease income and deferred rent on the facility.  The current and long-term lease obligations related to this lease agreement are recorded in the condensed consolidated balance sheet at September 30, 2012 in Current portion of lease obligations and Long-term lease obligations, respectively.  Rent expense under this lease for the three and nine months ended September 30, 2011 was $117 and $350, respectively.

 

Future minimum rental payments on the above lease for the next five years and thereafter are as follows: $129 for the remainder of 2012, $518 annually for 2013 through 2015, $529 for 2016, and a total of $2,522 for the remaining term of the lease.

 

Effective April 4, 2011, the Company entered into a seven-year sub-sublease agreement for additional office space in New York, New York.  The term of the sub-sublease commenced June 1, 2011, with a free base rental period until October 31, 2011. Following the expiration of the free base rental period, the monthly base rental payments will be $82 per month until May 31, 2015 and thereafter will be $90 per month until the end of the seven-year term.  Pursuant to the sub-sublease agreement, the sublessor is obligated to contribute $472 toward the cost of the Company’s alterations to the sub-subleased office space.  The Company has also entered into a direct lease with the over-landlord of such office space that will commence immediately upon the expiration of such sub-sublease agreement, for a term covering the period from May 1, 2018 to September 30, 2025; the direct lease provides for a free base rental period from May 1, 2018 to September 30, 2018.  Following the expiration of the free base rental period, the monthly base rental payments will be $186 per month from October 1, 2018 to April 30, 2023 and $204 per month from May 1, 2023 to September 30, 2025.  For accounting purposes, the sub-sublease agreement and direct lease agreement with the landlord constitutes one lease agreement.  As a result of the straight-line rent calculation generated by the free rent period and the tenant work credit, the monthly straight-line rental expense for the term of the entire lease from June 1, 2011 to September 30, 2025 will be $130.  The Company had a long-term lease obligation at September 30, 2012 and December 31, 2011 of $1,649 and $1,217, respectively.  Rent expense pertaining to this new lease for the three months ended September 30, 2012 and 2011 was $389 during both periods.  Rent expense pertaining to this new lease for the nine months ended September 30, 2012 and 2011 was $1,168 and $519, respectively.

 

Future minimum rental payments on the above lease for the next five years and thereafter are as follows: $245 for the remainder of 2012, $982 annually for 2013 through 2014, $1,037 for 2015, $1,076 for 2016 and a total of $17,582 for the remaining term of the lease.

 

NONVESTED STOCK AWARDS
NONVESTED STOCK AWARDS

20 - NONVESTED STOCK AWARDS

 

The table below summarizes the Company’s nonvested stock awards for the nine months ended September 30, 2012 under the Genco Shipping & Trading Limited 2005 Equity Incentive Plan (the “GS&T Plan”):

 

 

 

Number of
Shares

 

Weighted
Average Grant
Date Price

 

Outstanding at January 1, 2012

 

936,787

 

$

 14.06

 

Granted

 

15,000

 

3.50

 

Vested

 

(15,000

)

8.00

 

Forfeited

 

(1,500

)

6.39

 

 

 

 

 

 

 

Outstanding at September 30, 2012

 

935,287

 

$

 14.00

 

 

The total fair value of shares that vested under the GS&T Plan during the nine months ended September 30, 2012 and 2011 was $53 and $120, respectively.  The total fair value is calculated as the number of shares vested during the period multiplied by the fair value on the vesting date.

 

For the three and nine months ended September 30, 2012 and 2011, the Company recognized nonvested stock amortization expense for the GS&T Plan, which is included in general, administrative and management fees, as follows:

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

General, administrative and management fees

 

$

 1,069

 

$

 1,472

 

$

 3,214

 

$

 4,443

 

 

The fair value of nonvested stock at the grant date is equal to the closing stock price on that date.  The Company is amortizing these grants over the applicable vesting periods, net of anticipated forfeitures.  As of September 30, 2012, unrecognized future compensation cost of $4,800 related to nonvested stock will be recognized over a weighted-average period of 2.93 years.

 

The following table presents a summary of Baltic Trading’s nonvested stock awards for the nine months ended September 30, 2012 under the Baltic Trading Limited 2010 Equity Incentive Plan (the “Baltic Trading Plan”):

 

 

 

Number of Baltic
Trading
Common
Shares

 

Weighted
Average Grant
Date Price

 

Outstanding at January 1, 2012

 

545,750

 

$

 11.60

 

Granted

 

12,500

 

3.86

 

Vested

 

(129,000

)

13.31

 

Forfeited

 

 

 

 

 

 

 

 

 

Outstanding at September 30, 2012

 

429,250

 

$

 10.86

 

 

The total fair value of shares that vested under the Baltic Trading Plan during the nine months ended September 30, 2012 and 2011 was $505 and $1,131, respectively.  The total fair value is calculated as the number of shares vested during the period multiplied by the fair value on the vesting date.

 

For the three and nine months ended September 30, 2012 and 2011, the Company recognized nonvested stock amortization expense for the Baltic Trading Plan, which is included in general, administrative and management fees, as follows:

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

General, administrative and management fees

 

$

 403

 

$

 623

 

$

 1,377

 

$

 2,174

 

 

The Company is amortizing Baltic Trading’s grants over the applicable vesting periods, net of anticipated forfeitures.  As of September 30, 2012, unrecognized future compensation cost of $1,434 related to nonvested stock will be recognized over a weighted-average period of 1.96 years.

 

SHARE REPURCHASE PROGRAM
SHARE REPURCHASE PROGRAM

21 - SHARE REPURCHASE PROGRAM

 

Since the inception of its share repurchase program through September 30, 2012, the Company has repurchased and retired 278,300 shares of its common stock for $11,500. Currently, the terms of the 2007 Credit Facility require the Company to suspend all share repurchases until the Company can represent that it is in a position to again satisfy the collateral maintenance covenant.  No share repurchases were made during the three and nine months ended September 30, 2012 and 2011.

 

LEGAL PROCEEDINGS
LEGAL PROCEEDINGS

22 - LEGAL PROCEEDINGS

 

From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of its business, principally personal injury and property casualty claims. Such claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources.  The Company is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material effect on the Company, its financial condition, results of operations or cash flows.

 

SUBSEQUENT EVENTS
SUBSEQUENT EVENTS

23 - SUBSEQUENT EVENTS

 

On October 31, 2012, Baltic Trading declared a dividend of $0.01 per share to be paid on or about November 21, 2012 to shareholders of record as of November 14, 2012.  The aggregate amount of the dividend is expected to be approximately $227, of which approximately $170 will be paid to minority shareholders, which Baltic Trading anticipates will be funded from cash on hand at the time payment is to be made.

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

Principles of consolidation

 

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which include the accounts of GS&T, its wholly-owned subsidiaries and Baltic Trading, a subsidiary in which the Company owns a majority of the voting interests and exercises control.  All intercompany accounts and transactions have been eliminated in consolidation.

 

Basis of presentation

 

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”).  In the opinion of management of the Company, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and operating results have been included in the statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted.  These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2011 (the “2011 10-K”).  The results of operations for the three and nine month period ended September 30, 2012 and 2011 are not necessarily indicative of the operating results for the full year.

 

Vessels, net

 

Vessels, net is stated at cost less accumulated depreciation. Included in vessel costs are acquisition costs directly attributable to the acquisition of a vessel and expenditures made to prepare the vessel for its initial voyage. The Company also capitalizes interest costs for a vessel under construction as a cost that is directly attributable to the acquisition of a vessel. Vessels are depreciated on a straight-line basis over their estimated useful lives, determined to be 25 years from the date of initial delivery from the shipyard. Depreciation expense for vessels for the three months ended September 30, 2012 and 2011 was $33,462 and $33,054, respectively.  Depreciation expense for vessels for the nine months ended September 30, 2012 and 2011 was $99,646 and $96,773, respectively.

 

Depreciation expense is calculated based on cost less the estimated residual scrap value. The costs of significant replacements, renewals and betterments are capitalized and depreciated over the shorter of the vessel’s remaining estimated useful life or the estimated life of the renewal or betterment. Undepreciated cost of any asset component being replaced that was acquired after the initial vessel purchase is written off as a component of vessel operating expense. Expenditures for routine maintenance and repairs are expensed as incurred. Scrap value is estimated by the Company by taking the estimated scrap value of $245/lwt multiplied by the weight of the ship in lightweight tons (lwt).

 

Deferred revenue

 

Deferred revenue primarily relates to cash received from charterers prior to it being earned. These amounts are recognized as revenue when earned. Additionally, deferred revenue includes estimated customer claims mainly due to time charter performance issues. As of September 30, 2012 and December 31, 2011, the Company had an accrual of $563 and $762, respectively, related to these estimated customer claims.

 

Voyage revenues

 

Since the Company’s inception, revenues have been generated from time charter agreements, pool agreements and spot market-related time charters.  A time charter involves placing a vessel at the charterer’s disposal for a set period of time during which the charterer may use the vessel in return for the payment by the charterer of a specified daily hire rate, including any ballast bonus payments received pursuant to the time charter agreement.  Spot market-related time charters are the same as other time charter agreements, except the time charter rates are variable and are based on a percentage of the average daily rates as published by the Baltic Dry Index (“BDI”).  Voyage revenues also include sale of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement.

 

Voyage expense recognition

 

In time charters, spot market-related time charters and pool agreements, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. There are certain other non-specified voyage expenses such as commissions, which are typically borne by the Company. At the inception of a time charter, the Company records the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer as a gain or loss within voyage expenses. These differences in bunkers resulted in net gains of $242 and $666 during the three months ended September 30, 2012 and 2011, respectively, and $1,665 and $2,319 during the nine months ended September 30, 2012 and 2011, respectively.  Additionally, voyage expenses include the cost of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement.

 

Noncontrolling interest

 

Net loss attributable to noncontrolling interest during the three and nine months ended September 30, 2012 and 2011 reflects the noncontrolling interest’s share of the net loss of Baltic Trading, a subsidiary of the Company, which owns and employs drybulk vessels in the spot market or on spot market-related time charters.  The spot market represents immediate chartering of a vessel, usually for single voyages.  At September 30, 2012, the noncontrolling interest held a 74.91% economic interest in Baltic Trading while only holding 16.60% of voting power.  At December 31, 2011, the noncontrolling interest held a 74.89% economic interest in Baltic Trading while only holding 16.59% of voting power.

 

Income taxes

 

Pursuant to certain agreements, GS&T technically and commercially manages vessels for Baltic Trading as well as provides technical management of vessels for MEP in exchange for specified fees for these services provided.  These services are performed by Genco Management (USA) Limited (“Genco (USA)”), which has elected to be taxed as a corporation for United States federal income tax purposes.  As such, Genco (USA) is subject to United States federal income tax on its worldwide net income, including the net income derived from providing these services.  Genco (USA) has entered into a cost-sharing agreement with the Company and Genco Ship Management LLC, collectively Manco, pursuant to which Genco (USA) agrees to reimburse Manco for the costs incurred by Genco (USA) for the use of Manco’s personnel and services in connection with the provision of the services for both Baltic Trading and MEP’s vessels.

 

Total revenue earned for these services during the three months ended September 30, 2012 and 2011 was $1,530 and $1,588, respectively, of which $703 and $760, respectively, eliminated upon consolidation.  After allocation of certain expenses, there was taxable income of $664 associated with these activities for the three months ended September 30, 2012.  This resulted in estimated tax expense of $299 for the three months ended September 30, 2012.  After allocation of certain expenses, there was taxable income of $668 associated with these activities for the three months ended September 30, 2011.  This resulted in income tax expense of $319 for the three months ended September 30, 2011.

 

Total revenue earned for these services during the nine months ended September 30, 2012 and 2011 was $4,575 and $4,689, respectively, of which $2,109 and $2,232, respectively, eliminated upon consolidation.  After allocation of certain expenses, there was taxable income of $1,985 associated with these activities for the nine months ended September 30, 2012.  This resulted in estimated tax expense of $892 for the nine months ended September 30, 2012.  After allocation of certain expenses, there was taxable income of $2,113 associated with these activities for the nine months ended September 30, 2011.  This resulted in income tax expense of $1,010 for the nine months ended September 30, 2011.

 

Baltic Trading is subject to income tax on its United States source income.  During the three months ended September 30, 2012 and 2011, Baltic Trading had United States source income of $200 and $452, respectively.  Baltic Trading’s United States income tax expense for the three months ended September 30, 2012 and 2011 was $4 and $9, respectively.

 

During the nine months ended September 30, 2012 and 2011, Baltic Trading had United States source income of $1,321 and $2,909, respectively.  Baltic Trading’s United States income tax expense for the nine months ended September 30, 2012 and 2011 was $26 and $31, respectively.

 

Recent accounting pronouncements

 

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (Topic 820) — Fair Value Measurement” (“ASU 2011-04”), to provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards.  ASU 2011-04 changes certain fair value measurement principles and enhances the disclosure requirements, particularly for Level 3 fair value measurements.  This standard was effective for interim and annual periods beginning after December 15, 2011 and is applied on a prospective basis.  The Company has adopted ASU 2011-04 and the impact of adoption is not material to the Company’s condensed consolidated financial statements.

 

In June 2011, the FASB issued Accounting Standards Update No. 2011-05, “Comprehensive Income (Topic 220), Presentation of Comprehensive Income” (“ASU 2011-05”), to require an entity to present the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements.  ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity.  The standard does not change the items that must be reported for other comprehensive income, how such items are measured or when they must be reclassified to net income.  This standard was effective for interim and annual periods beginning after December 15, 2011 and was to be applied retrospectively.  The FASB has deferred the requirement to present reclassification adjustments for each component of accumulate other comprehensive income in both net income and other comprehensive income.  Companies are required to either present amounts reclassified out of other comprehensive income on the face of the financial statements or disclose those amounts in the notes to the financial statements.  During the deferral period, there is no requirement to separately present or disclose the reclassification adjustments into net income.  The effective date of this deferral will be consistent with the effective date of ASU 2011-05.  The Company has adopted ASU 2011-05 and disclosed comprehensive income in our condensed consolidated statements of comprehensive (loss) income. This guidance only affects financial statement presentation and has no impact on the Company’s consolidated results of operations, financial position and cash flows.

 

GENERAL INFORMATION (Tables)

 

Wholly Owned Subsidiaries

 

Vessels Acquired

 

Dwt

 

Delivery Date

 

Year Built

 

 

 

 

 

 

 

 

 

Genco Reliance Limited

 

Genco Reliance

 

29,952

 

12/6/04

 

1999

Genco Vigour Limited

 

Genco Vigour

 

73,941

 

12/15/04

 

1999

Genco Explorer Limited

 

Genco Explorer

 

29,952

 

12/17/04

 

1999

Genco Carrier Limited

 

Genco Carrier

 

47,180

 

12/28/04

 

1998

Genco Sugar Limited

 

Genco Sugar

 

29,952

 

12/30/04

 

1998

Genco Pioneer Limited

 

Genco Pioneer

 

29,952

 

1/4/05

 

1999

Genco Progress Limited

 

Genco Progress

 

29,952

 

1/12/05

 

1999

Genco Wisdom Limited

 

Genco Wisdom

 

47,180

 

1/13/05

 

1997

Genco Success Limited

 

Genco Success

 

47,186

 

1/31/05

 

1997

Genco Beauty Limited

 

Genco Beauty

 

73,941

 

2/7/05

 

1999

Genco Knight Limited

 

Genco Knight

 

73,941

 

2/16/05

 

1999

Genco Leader Limited

 

Genco Leader

 

73,941

 

2/16/05

 

1999

Genco Marine Limited

 

Genco Marine

 

45,222

 

3/29/05

 

1996

Genco Prosperity Limited

 

Genco Prosperity

 

47,180

 

4/4/05

 

1997

Genco Muse Limited

 

Genco Muse

 

48,913

 

10/14/05

 

2001

Genco Acheron Limited

 

Genco Acheron

 

72,495

 

11/7/06

 

1999

Genco Surprise Limited

 

Genco Surprise

 

72,495

 

11/17/06

 

1998

Genco Augustus Limited

 

Genco Augustus

 

180,151

 

8/17/07

 

2007

Genco Tiberius Limited

 

Genco Tiberius

 

175,874

 

8/28/07

 

2007

Genco London Limited

 

Genco London

 

177,833

 

9/28/07

 

2007

Genco Titus Limited

 

Genco Titus

 

177,729

 

11/15/07

 

2007

Genco Challenger Limited

 

Genco Challenger

 

28,428

 

12/14/07

 

2003

Genco Charger Limited

 

Genco Charger

 

28,398

 

12/14/07

 

2005

Genco Warrior Limited

 

Genco Warrior

 

55,435

 

12/17/07

 

2005

Genco Predator Limited

 

Genco Predator

 

55,407

 

12/20/07

 

2005

Genco Hunter Limited

 

Genco Hunter

 

58,729

 

12/20/07

 

2007

Genco Champion Limited

 

Genco Champion

 

28,445

 

1/2/08

 

2006

Genco Constantine Limited

 

Genco Constantine

 

180,183

 

2/21/08

 

2008

Genco Raptor LLC

 

Genco Raptor

 

76,499

 

6/23/08

 

2007

Genco Cavalier LLC

 

Genco Cavalier

 

53,617

 

7/17/08

 

2007

Genco Thunder LLC

 

Genco Thunder

 

76,588

 

9/25/08

 

2007

Genco Hadrian Limited

 

Genco Hadrian

 

169,694

 

12/29/08

 

2008

Genco Commodus Limited

 

Genco Commodus

 

169,025

 

7/22/09

 

2009

Genco Maximus Limited

 

Genco Maximus

 

169,025

 

9/18/09

 

2009

Genco Claudius Limited

 

Genco Claudius

 

169,025

 

12/30/09

 

2010

Genco Bay Limited

 

Genco Bay

 

34,296

 

8/24/10

 

2010

Genco Ocean Limited

 

Genco Ocean

 

34,409

 

7/26/10

 

2010

Genco Avra Limited

 

Genco Avra

 

34,391

 

5/12/11

 

2011

Genco Mare Limited

 

Genco Mare

 

34,428

 

7/20/11

 

2011

Genco Spirit Limited

 

Genco Spirit

 

34,432

 

11/10/11

 

2011

Genco Aquitaine Limited

 

Genco Aquitaine

 

57,981

 

8/18/10

 

2009

Genco Ardennes Limited

 

Genco Ardennes

 

57,981

 

8/31/10

 

2009

Genco Auvergne Limited

 

Genco Auvergne

 

57,981

 

8/16/10

 

2009

Genco Bourgogne Limited

 

Genco Bourgogne

 

57,981

 

8/24/10

 

2010

Genco Brittany Limited

 

Genco Brittany

 

57,981

 

9/23/10

 

2010

Genco Languedoc Limited

 

Genco Languedoc

 

57,981

 

9/29/10

 

2010

Genco Loire Limited

 

Genco Loire

 

53,416

 

8/4/10

 

2009

Genco Lorraine Limited

 

Genco Lorraine

 

53,416

 

7/29/10

 

2009

Genco Normandy Limited

 

Genco Normandy

 

53,596

 

8/10/10

 

2007

Genco Picardy Limited

 

Genco Picardy

 

55,257

 

8/16/10

 

2005

Genco Provence Limited

 

Genco Provence

 

55,317

 

8/23/10

 

2004

Genco Pyrenees Limited

 

Genco Pyrenees

 

57,981

 

8/10/10

 

2010

Genco Rhone Limited

 

Genco Rhone

 

58,018

 

3/29/11

 

2011

 

 

Baltic Trading’s Wholly Owned
Subsidiaries

 

Vessel

 

Dwt

 

Delivery Date

 

Year
Built

 

 

 

 

 

 

 

 

 

Baltic Leopard Limited

 

Baltic Leopard

 

53,447

 

4/8/10

 

2009

Baltic Panther Limited

 

Baltic Panther

 

53,351

 

4/29/10

 

2009

Baltic Cougar Limited

 

Baltic Cougar

 

53,432

 

5/28/10

 

2009

Baltic Jaguar Limited

 

Baltic Jaguar

 

53,474

 

5/14/10

 

2009

Baltic Bear Limited

 

Baltic Bear

 

177,717

 

5/14/10

 

2010

Baltic Wolf Limited

 

Baltic Wolf

 

177,752

 

10/14/10

 

2010

Baltic Wind Limited

 

Baltic Wind

 

34,409

 

8/4/10

 

2009

Baltic Cove Limited

 

Baltic Cove

 

34,403

 

8/23/10

 

2010

Baltic Breeze Limited

 

Baltic Breeze

 

34,386

 

10/12/10

 

2010

 

SEGMENT INFORMATION (Tables)

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Voyage revenue from external customers

 

 

 

 

 

 

 

 

 

GS&T

 

$

 47,312

 

$

 82,586

 

$

 154,552

 

$

 262,259

 

Baltic Trading

 

6,291

 

10,898

 

20,188

 

30,355

 

Total operating segments

 

53,603

 

93,484

 

174,740

 

292,614

 

Eliminating revenue

 

 

 

 

 

Total consolidated voyage revenue from external customers

 

$

 53,603

 

$

 93,484

 

$

 174,740

 

$

 292,614

 

 

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Intersegment revenue

 

 

 

 

 

 

 

 

 

GS&T

 

$

 703

 

$

 760

 

$

 2,109

 

$

 2,232

 

Baltic Trading

 

 

 

 

 

Total operating segments

 

703

 

760

 

2,109

 

2,232

 

Eliminating revenue

 

(703

)

(760

)

(2,109

)

(2,232

)

Total consolidated intersegment revenue

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

 

 

 

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Net (loss) income

 

 

 

 

 

 

 

 

 

GS&T

 

$

 (36,969

)

$

 2,144

 

$

 (94,779

)

$

 27,422

 

Baltic Trading

 

(4,822

)

(194

)

(12,942

)

(2,241

)

Total operating segments

 

(41,791

)

1,950

 

(107,721

)

25,181

 

Eliminating net loss

 

(246

)

(533

)

(1,194

)

(1,763

)

Total consolidated net (loss) income

 

$

 (42,037

)

$

 1,417

 

$

 (108,915

)

$

 23,418

 

 

 

 

 

September 30,

2012

 

December 31,
2011

 

Total assets

 

 

 

 

 

GS&T

 

$

 2,529,964

 

$

 2,737,988

 

Baltic Trading

 

368,127

 

384,955

 

Total operating segments

 

2,898,091

 

3,122,943

 

Eliminating assets

 

(3,518

)

(3,666

)

Total consolidated assets

 

$

 2,894,573

 

$

 3,119,277

 

 

NET (LOSS) INCOME PER COMMON SHARE (Tables)

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding, basic:

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, basic

 

42,885,810

 

35,157,110

 

41,290,719

 

35,149,912

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding, diluted:

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, basic

 

42,885,810

 

35,157,110

 

41,290,719

 

35,149,912

 

 

 

 

 

 

 

 

 

 

 

Dilutive effect of convertible notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dilutive effect of restricted stock awards

 

 

55,730

 

 

62,129

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding, diluted

 

42,855,810

 

35,212,840

 

41,290,719

 

35,212,041

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to GS&T

 

$

 (38,449

)

$

 1,562

 

$

 (99,289

)

$

 25,080

 

 

 

 

 

 

 

 

 

 

 

Interest expense related to convertible notes, if dilutive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to GS&T for the computation of diluted net (loss) income per share

 

$

 (38,449

)

$

 1,562

 

$

 (99,289

)

$

 25,080

 

 

LONG-TERM DEBT (Tables)

 

 

 

September 30,

2012

 

December 31,

2011

 

 

 

 

 

 

 

2007 Credit Facility

 

$

 1,055,912

 

$

 1,174,500

 

$100 Million Term Loan Facility

 

75,484

 

90,869

 

$253 Million Term Loan Facility

 

180,793

 

221,393

 

2010 Baltic Trading Credit Facility

 

101,250

 

101,250

 

Less: Current portion

 

 

(185,077

)

 

 

 

 

 

 

Long-term debt

 

$

 1,413,439

 

$

 1,402,935

 

 

 

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Effective Interest Rate

 

4.65

%

4.36

%

4.60

%

4.41

%

Range of Interest Rates (excluding impact of swaps and unused commitment fees)

 

3.22% to 4.50

%

2.25% to 3.33

%

3.22% to 4.63

%

2.19% to 3.33

%

 

CONVERTIBLE SENIOR NOTES (Tables)

 

 

 

September 30,

2012

 

December 31,
2011

 

Carrying amount of the equity component (additional paid-in capital)

 

$

 24,375

 

$

 24,375

 

Principal amount of the 2010 Notes

 

125,000

 

125,000

 

Unamortized discount of the liability component

 

15,274

 

18,619

 

Net carrying amount of the liability component

 

109,726

 

106,381

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

Effective interest rate on liability component

 

10.0

%

10.0

%

10.0

%

10.0

%

Cash interest expense recognized

 

$

 1,580

 

$

 1,584

 

$

 4,696

 

$

 4,677

 

Non-cash interest expense recognized

 

1,158

 

1,046

 

3,345

 

2,999

 

Non-cash deferred financing amortization costs included in interest expense

 

181

 

181

 

540

 

538

 

 

INTEREST RATE SWAP AGREEMENTS (Tables)

 

 

 

 

 

 

 

 

 

September 30,
2012

 

December 31,
2011

 

Interest Rate Swap Detail

 

Notional

 

Notional

 

Trade

 

Fixed

 

Start Date

 

End Date

 

Amount

 

Amount

 

Date

 

Rate

 

of Swap

 

of Swap

 

Outstanding

 

Outstanding

 

9/6/05

 

4.485

%

9/14/05

 

7/29/15

 

$

106,233

 

$

106,233

 

3/29/06

 

5.25

%

1/2/07

 

1/1/14

 

50,000

 

50,000

 

3/24/06

 

5.075

%

1/2/08

 

1/2/13

 

50,000

 

50,000

 

8/9/07

 

5.07

%

1/2/08

 

1/3/12

 

 

100,000

 

8/16/07

 

4.985

%

3/31/08

 

3/31/12

 

 

50,000

 

8/16/07

 

5.04

%

3/31/08

 

3/31/12

 

 

100,000

 

1/9/09

 

2.05

%

1/22/09

 

1/22/14

 

100,000

 

100,000

 

2/11/09

 

2.45

%

2/23/09

 

2/23/14

 

50,000

 

50,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

356,233

 

$

606,233

 

 

 

 

 

Asset Derivatives

 

Liability Derivatives

 

 

 

Balance

 

Fair Value

 

Balance

 

Fair Value

 

 

 

Sheet
Location

 

September 30,
2012

 

December
31, 2011

 

Sheet
Location

 

September 30,
2012

 

December
31, 2011

 

Derivatives designated as hedging instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate contracts

 

Fair value of derivative instruments (Current Assets)

 

$

 

$

 

Fair value of derivative instruments (Current Liabilities)

 

$

609

 

$

1,686

 

Interest rate contracts

 

Fair value of derivative instruments (Noncurrent Assets)

 

 

 

Fair value of derivative instruments (Noncurrent Liabilities)

 

18,261

 

23,654

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total derivatives designated as hedging instruments

 

 

 

 

 

 

 

18,870

 

25,340

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivatives

 

 

 

$

 

$

 

 

 

$

18,870

 

$

25,340

 

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Three-Month Period Ended September 30, 2012

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2012

 

Portion)

 

2012

 

Portion)

 

2012

 

Interest rate contracts

 

$

 (1,434

)

Interest Expense

 

$

 2,959

 

Other Income (Expense)

 

$

 30

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Three-Month Period Ended September 30, 2011

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2011

 

Portion)

 

2011

 

Portion)

 

2011

 

Interest rate contracts

 

$

 (5,021

)

Interest Expense

 

$

 7,438

 

Other Income (Expense)

 

$

 18

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Nine-Month Period Ended September 30, 2012

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2012

 

Portion)

 

2012

 

Portion)

 

2012

 

Interest rate contracts

 

$

 (3,999

)

Interest Expense

 

$

 10,392

 

Other Income (Expense)

 

$

 76

 

 

The Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations

For the Nine-Month Period Ended September 30, 2011

 

Derivatives in Cash
Flow Hedging

 

Amount of
Gain (Loss)
Recognized
in AOCI on
Derivative
(Effective
Portion)

 

Location of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective

 

Amount of
Gain (Loss)
Reclassified
from AOCI
into income
(Effective
Portion)

 

Location of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective

 

Amount of
Gain (Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion)

 

Relationships

 

2011

 

Portion)

 

2011

 

Portion)

 

2011

 

Interest rate contracts

 

$

 (11,705

)

Interest Expense

 

$

 22,038

 

Other Income (Expense)

 

$

 38

 

 

ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables)
Schedule of components of AOCI included in the accompanying condensed consolidated balance sheets

 

 

 

Net Unrealized
Gain (Loss) on
Cash Flow
Hedges

 

Unrealized
Gain
on
Investments

 

AOCI

 

AOCI — January 1, 2012

 

$

 (25,245

)

$

 7,696

 

$

 (17,549

)

Change in unrealized gain on investments

 

 

 

(643

)

(643

)

Unrealized gain on cash flow hedges

 

6,394

 

 

 

6,394

 

AOCI — September 30, 2012

 

$

 (18,851

)

$

 7,053

 

$

 (11,798

)

 

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

 

 

 

September 30, 2012

 

December 31, 2011

 

 

 

Carrying
Value

 

Fair Value

 

Carrying
Value

 

Fair Value

 

Cash and cash equivalents

 

$

 87,778

 

$

 87,778

 

$

 227,968

 

$

 227,968

 

Restricted cash

 

10,150

 

10,150

 

9,750

 

9,750

 

Floating rate debt

 

1,413,439

 

1,413,439

 

1,588,012

 

1,588,012

 

2010 Notes

 

109,726

 

48,750

 

106,381

 

80,000

 

 

 

 

 

September 30, 2012

 

 

 

Total

 

Quoted
market
prices in
active
markets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Investments

 

$

 23,825

 

$

 23,825

 

$

 —

 

Derivative instruments — liability position

 

18,870

 

 

18,870

 

 

 

 

December 31, 2011

 

 

 

Total

 

Quoted
market
prices in
active
markets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Investments

 

$

 24,468

 

$

 24,468

 

$

 —

 

Derivative instruments — liability position

 

25,340

 

 

25,340

 

 

PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS (Tables)
Schedule of prepaid expenses and other current assets

 

 

 

September 30,

2012

 

December 31,

2011

 

Lubricant inventory, fuel oil and diesel oil inventory and other stores

 

$

 10,321

 

$

 10,376

 

Prepaid items

 

4,621

 

5,514

 

Insurance receivable

 

860

 

1,025

 

Other

 

1,218

 

794

 

Total prepaid expenses and other current assets

 

$

 17,020

 

$

 17,709

 

 

OTHER ASSETS, NET (Tables)
Schedule of total net deferred financing costs

 

 

 

September 30,

2012

 

December 31,

2011

 

 

 

 

 

 

 

2007 Credit Facility

 

$

 29,923

 

$

 13,189

 

$100 Million Term Loan Facility

 

1,822

 

1,578

 

$253 Million Term Loan Facility

 

4,802

 

4,113

 

2010 Notes

 

3,637

 

3,637

 

2010 Baltic Trading Credit Facility

 

3,027

 

3,027

 

Total deferred financing costs

 

43,211

 

25,544

 

Less: accumulated amortization

 

11,304

 

7,749

 

Total

 

$

 31,907

 

$

 17,795

 

 

FIXED ASSETS (Tables)
Schedule of fixed assets

 

 

 

September 30,

2012

 

December 31,

2011

 

Fixed assets, at cost:

 

 

 

 

 

Vessel equipment

 

$

 2,973

 

$

 2,720

 

Leasehold improvements

 

3,823

 

3,664

 

Furniture and fixtures

 

997

 

997

 

Computer equipment

 

686

 

632

 

Total costs

 

8,479

 

8,013

 

Less: accumulated depreciation and amortization

 

3,077

 

2,422

 

Total

 

$

 5,402

 

$

 5,591

 

 

ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables)
Schedule of accounts payable and accrued expenses

 

 

 

September 30,

2012

 

December 31,

2011

 

Accounts payable

 

$

 3,691

 

$

 5,047

 

Accrued general and administrative expenses

 

10,115

 

14,275

 

Accrued vessel operating expenses

 

11,344

 

11,390

 

Total

 

$

 25,150

 

$

 30,712

 

 

NONVESTED STOCK AWARDS (Tables)

 

 

 

Number of
Shares

 

Weighted
Average Grant
Date Price

 

Outstanding at January 1, 2012

 

936,787

 

$

 14.06

 

Granted

 

15,000

 

3.50

 

Vested

 

(15,000

)

8.00

 

Forfeited

 

(1,500

)

6.39

 

 

 

 

 

 

 

Outstanding at September 30, 2012

 

935,287

 

$

 14.00

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

General, administrative and management fees

 

$

 1,069

 

$

 1,472

 

$

 3,214

 

$

 4,443

 

 

 

 

 

Number of Baltic
Trading
Common
Shares

 

Weighted
Average Grant
Date Price

 

Outstanding at January 1, 2012

 

545,750

 

$

 11.60

 

Granted

 

12,500

 

3.86

 

Vested

 

(129,000

)

13.31

 

Forfeited

 

 

 

 

 

 

 

 

 

Outstanding at September 30, 2012

 

429,250

 

$

 10.86

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

General, administrative and management fees

 

$

 403

 

$

 623

 

$

 1,377

 

$

 2,174

 

 

GENERAL INFORMATION (Details)
Sep. 30, 2012
item
Genco Reliance |
Genco Reliance Limited
 
General information
 
Capacity of vessels
29,952 
Genco Vigour |
Genco Vigour Limited
 
General information
 
Capacity of vessels
73,941 
Genco Explorer |
Genco Explorer Limited
 
General information
 
Capacity of vessels
29,952 
Genco Carrier |
Genco Carrier Limited
 
General information
 
Capacity of vessels
47,180 
Genco Sugar |
Genco Sugar Limited
 
General information
 
Capacity of vessels
29,952 
Genco Pioneer |
Genco Pioneer Limited
 
General information
 
Capacity of vessels
29,952 
Genco Progress |
Genco Progress Limited
 
General information
 
Capacity of vessels
29,952 
Genco Wisdom |
Genco Wisdom Limited
 
General information
 
Capacity of vessels
47,180 
Genco Success |
Genco Success Limited
 
General information
 
Capacity of vessels
47,186 
Genco Beauty |
Genco Beauty Limited
 
General information
 
Capacity of vessels
73,941 
Genco Knight |
Genco Knight Limited
 
General information
 
Capacity of vessels
73,941 
Genco Leader |
Genco Leader Limited
 
General information
 
Capacity of vessels
73,941 
Genco Marine |
Genco Marine Limited
 
General information
 
Capacity of vessels
45,222 
Genco Prosperity |
Genco Prosperity Limited
 
General information
 
Capacity of vessels
47,180 
Genco Muse |
Genco Muse Limited
 
General information
 
Capacity of vessels
48,913 
Genco Acheron |
Genco Acheron Limited
 
General information
 
Capacity of vessels
72,495 
Genco Surprise |
Genco Surprise Limited
 
General information
 
Capacity of vessels
72,495 
Genco Augustus |
Genco Augustus Limited
 
General information
 
Capacity of vessels
180,151 
Genco Tiberius |
Genco Tiberius Limited
 
General information
 
Capacity of vessels
175,874 
Genco London |
Genco London Limited
 
General information
 
Capacity of vessels
177,833 
Genco Titus |
Genco Titus Limited
 
General information
 
Capacity of vessels
177,729 
Genco Challenger |
Genco Challenger Limited
 
General information
 
Capacity of vessels
28,428 
Genco Charger |
Genco Charger Limited
 
General information
 
Capacity of vessels
28,398 
Genco Warrior |
Genco Warrior Limited
 
General information
 
Capacity of vessels
55,435 
Genco Predator |
Genco Predator Limited
 
General information
 
Capacity of vessels
55,407 
Genco Hunter |
Genco Hunter Limited
 
General information
 
Capacity of vessels
58,729 
Genco Champion |
Genco Champion Limited
 
General information
 
Capacity of vessels
28,445 
Genco Constantine |
Genco Constantine Limited
 
General information
 
Capacity of vessels
180,183 
Genco Raptor |
Genco Raptor LLC
 
General information
 
Capacity of vessels
76,499 
Genco Cavalier |
Genco Cavalier LLC
 
General information
 
Capacity of vessels
53,617 
Genco Thunder |
Genco Thunder LLC
 
General information
 
Capacity of vessels
76,588 
Genco Hadrian |
Genco Hadrian Limited
 
General information
 
Capacity of vessels
169,694 
Genco Commodus |
Genco Commodus Limited
 
General information
 
Capacity of vessels
169,025 
Genco Maximus |
Genco Maximus Limited
 
General information
 
Capacity of vessels
169,025 
Genco Claudius |
Genco Claudius Limited
 
General information
 
Capacity of vessels
169,025 
Genco Bay |
Genco Bay Limited
 
General information
 
Capacity of vessels
34,296 
Genco Ocean |
Genco Ocean Limited
 
General information
 
Capacity of vessels
34,409 
Genco Avra |
Genco Avra Limited
 
General information
 
Capacity of vessels
34,391 
Genco Mare |
Genco Mare Limited
 
General information
 
Capacity of vessels
34,428 
Genco Spirit |
Genco Spirit Limited
 
General information
 
Capacity of vessels
34,432 
Genco Aquitaine |
Genco Aquitaine Limited
 
General information
 
Capacity of vessels
57,981 
Genco Ardennes |
Genco Ardennes Limited
 
General information
 
Capacity of vessels
57,981 
Genco Auvergne |
Genco Auvergne Limited
 
General information
 
Capacity of vessels
57,981 
Genco Bourgogne |
Genco Bourgogne Limited
 
General information
 
Capacity of vessels
57,981 
Genco Brittany |
Genco Brittany Limited
 
General information
 
Capacity of vessels
57,981 
Genco Languedoc |
Genco Languedoc Limited
 
General information
 
Capacity of vessels
57,981 
Genco Loire |
Genco Loire Limited
 
General information
 
Capacity of vessels
53,416 
Genco Lorraine |
Genco Lorraine Limited
 
General information
 
Capacity of vessels
53,416 
Genco Normandy |
Genco Normandy Limited
 
General information
 
Capacity of vessels
53,596 
Genco Picardy |
Genco Picardy Limited
 
General information
 
Capacity of vessels
55,257 
Genco Provence |
Genco Provence Limited
 
General information
 
Capacity of vessels
55,317 
Genco Pyrenees |
Genco Pyrenees Limited
 
General information
 
Capacity of vessels
57,981 
Genco Rhone |
Genco Rhone Limited
 
General information
 
Capacity of vessels
58,018 
Baltic Leopard |
Baltic Leopard Limited
 
General information
 
Capacity of vessels
53,447 
Baltic Panther |
Baltic Panther Limited
 
General information
 
Capacity of vessels
53,351 
Baltic Cougar |
Baltic Cougar Limited
 
General information
 
Capacity of vessels
53,432 
Baltic Jaguar |
Baltic Jaguar Limited
 
General information
 
Capacity of vessels
53,474 
Baltic Bear |
Baltic Bear Limited
 
General information
 
Capacity of vessels
177,717 
Baltic Wolf |
Baltic Wolf Limited
 
General information
 
Capacity of vessels
177,752 
Baltic Wind |
Baltic Wind Limited
 
General information
 
Capacity of vessels
34,409 
Baltic Cove |
Baltic Cove Limited
 
General information
 
Capacity of vessels
34,403 
Baltic Breeze |
Baltic Breeze Limited
 
General information
 
Capacity of vessels
34,386 
GENERAL INFORMATION (Details 2) (USD $)
1 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended
Feb. 29, 2012
Sep. 30, 2012
Feb. 28, 2012
Sep. 30, 2012
MEP
Sep. 30, 2012
Genco Investment LLC
Baltic Trading Limited
Dec. 31, 2011
Genco Investment LLC
Baltic Trading Limited
Sep. 30, 2012
Genco Investment LLC
Baltic Trading Limited
Minimum
Sep. 30, 2012
Genco Investment LLC
Baltic Trading Limited
Class B stock
Dec. 31, 2011
Genco Investment LLC
Baltic Trading Limited
Class B stock
General information
 
 
 
 
 
 
 
 
 
Number of shares owned by Genco Investment LLC
 
 
 
 
 
 
 
5,699,088 
5,699,088 
Ownership interest held (as a percent)
 
 
 
 
25.09% 
25.11% 
 
 
 
Ownership interest held (as a percent)
 
 
 
 
 
 
10.00% 
 
 
Aggregate voting power held (as a percent)
 
 
 
 
83.40% 
83.41% 
 
 
 
Percentage of additional shares to be received by Genco Investment LLC
 
 
 
 
 
 
 
2.00% 
 
Technical services fee per ship per day
 
 
 
$ 750 
 
 
 
 
 
Initial term of provision of technical service
 
 
 
1 year 
 
 
 
 
 
Notice period for cancellation of provision of technical services
 
 
 
60 days 
 
 
 
 
 
Period for termination fee upon change of control
 
 
 
1 year 
 
 
 
 
 
Notice period for cancellation of provision of technical services by company
 
 
 
60 days 
 
 
 
 
 
Shares issued during the period
7,500,000 
7,500,000 
 
 
 
 
 
 
 
Offering price (in dollars per share)
 
 
$ 7.10 
 
 
 
 
 
 
Net proceeds from issue of shares after deducting underwriters' fees and expenses
$ 49,874,000 
$ 49,874,000 
 
 
 
 
 
 
 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
USDperlwt
Sep. 30, 2011
Dec. 31, 2011
Vessels, net
 
 
 
 
 
Useful life
 
 
25 years 
 
 
Depreciation
$ 33,462 
$ 33,054 
$ 99,646 
$ 96,773 
 
Estimated scrap value (in dollars per lightweight ton)
 
 
245.00 
 
 
Deferred revenue
 
 
 
 
 
Accrual related to estimated customer claims
563 
 
563 
 
762 
Voyage expense recognition
 
 
 
 
 
Gain (loss) on purchase and sale of bunker fuel
$ 242 
$ 666 
$ 1,665 
$ 2,319 
 
Baltic Trading Limited
 
 
 
 
 
Noncontrolling interest
 
 
 
 
 
Economic interest held by noncontrolling interest (as a percent)
74.91% 
 
74.91% 
 
74.89% 
Voting power (as a percent)
16.60% 
 
16.60% 
 
16.59% 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Income taxes
 
 
 
 
Total revenue earned
$ 828 
$ 828 
$ 2,466 
$ 2,457 
Taxable income
(41,734)
1,745 
(107,997)
24,459 
Income tax expense
303 
328 
918 
1,041 
Baltic Trading |
United States
 
 
 
 
Income taxes
 
 
 
 
Taxable income
200 
452 
1,321 
2,909 
Income tax expense
26 
31 
Vessel management services
 
 
 
 
Income taxes
 
 
 
 
Total revenue earned
1,530 
1,588 
4,575 
4,689 
Taxable income
664 
668 
1,985 
2,113 
Income tax expense
299 
319 
892 
1,010 
Vessel management services |
Intersegment elimination
 
 
 
 
Income taxes
 
 
 
 
Total revenue earned
$ 703 
$ 760 
$ 2,109 
$ 2,232 
SEGMENT INFORMATION (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
item
Sep. 30, 2011
Dec. 31, 2011
SEGMENT INFORMATION
 
 
 
 
 
Number of operating segments
 
 
 
 
Voyage Revenue from External Customers
 
 
 
 
 
Total consolidated voyage revenue from external customers
$ 53,603 
$ 93,484 
$ 174,740 
$ 292,614 
 
Net (loss) income
 
 
 
 
 
Total consolidated net (loss) income
(42,037)
1,417 
(108,915)
23,418 
 
Total assets
 
 
 
 
 
Total consolidated assets
2,894,573 
 
2,894,573 
 
3,119,277 
Operating segments
 
 
 
 
 
Voyage Revenue from External Customers
 
 
 
 
 
Total consolidated voyage revenue from external customers
53,603 
93,484 
174,740 
292,614 
 
Intersegment revenue
 
 
 
 
 
Total consolidated intersegment revenue
703 
760 
2,109 
2,232 
 
Net (loss) income
 
 
 
 
 
Total consolidated net (loss) income
(41,791)
1,950 
(107,721)
25,181 
 
Total assets
 
 
 
 
 
Total consolidated assets
2,898,091 
 
2,898,091 
 
3,122,943 
GS & T
 
 
 
 
 
Voyage Revenue from External Customers
 
 
 
 
 
Total consolidated voyage revenue from external customers
47,312 
82,586 
154,552 
262,259 
 
Intersegment revenue
 
 
 
 
 
Total consolidated intersegment revenue
703 
760 
2,109 
2,232 
 
Net (loss) income
 
 
 
 
 
Total consolidated net (loss) income
(36,969)
2,144 
(94,779)
27,422 
 
Total assets
 
 
 
 
 
Total consolidated assets
2,529,964 
 
2,529,964 
 
2,737,988 
Baltic Trading
 
 
 
 
 
Voyage Revenue from External Customers
 
 
 
 
 
Total consolidated voyage revenue from external customers
6,291 
10,898 
20,188 
30,355 
 
Net (loss) income
 
 
 
 
 
Total consolidated net (loss) income
(4,822)
(194)
(12,942)
(2,241)
 
Total assets
 
 
 
 
 
Total consolidated assets
368,127 
 
368,127 
 
384,955 
Intersegment elimination
 
 
 
 
 
Intersegment revenue
 
 
 
 
 
Total consolidated intersegment revenue
(703)
(760)
(2,109)
(2,232)
 
Net (loss) income
 
 
 
 
 
Total consolidated net (loss) income
(246)
(533)
(1,194)
(1,763)
 
Total assets
 
 
 
 
 
Total consolidated assets
$ (3,518)
 
$ (3,518)
 
$ (3,666)
CASH FLOW INFORMATION (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
item
Dec. 31, 2011
item
CASH FLOW INFORMATION
 
 
Number of interest rate swaps
Derivative asset and liability balances
 
 
Fair value of interest rate swaps in a liability position classified within current liabilities
$ 609 
$ 1,686 
Interest rate contracts |
Derivatives designated as hedging instruments
 
 
Derivative asset and liability balances
 
 
Fair value of interest rate swaps in a liability position
18,870 
25,340 
Fair value of interest rate swaps in a liability position classified within current liabilities
$ 609 
$ 1,686 
Number of derivative instruments in a liability position
CASH FLOW INFORMATION (Details 2) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Non-cash investing and financing activities
 
 
Reclassification from deposits on vessels to vessels, net of accumulated depreciation due to completion of purchase of the Genco Rhone and Genco Avra
 
$ 10,354 
Cash paid for interest
61,632 
61,642 
Cash paid for estimated income taxes
926 
1,010 
Accounts payable and accrued expenses
 
 
Non-cash investing and financing activities
 
 
Amount of vessel purchases included in accounts payable and accrued expenses
31 
804 
Deposits on vessel purchases included in accounts payable and accrued expenses
 
26 
Purchases of other fixed assets included in accounts payable and accrued expenses
77 
1,305 
Deferred financing fees included in accounts payable and accrued expenses
246 
 
Long-term interest payable
 
 
Non-cash investing and financing activities
 
 
Deferred financing fees included in accounts payable and accrued expenses
13,199 
 
Prepaid expenses and other current assets
 
 
Non-cash investing and financing activities
 
 
Interest receivable associated with deposits on vessels included in prepaid expenses and other current assets
 
$ 15 
CASH FLOW INFORMATION (Details 3) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended 1 Months Ended 9 Months Ended 1 Months Ended
Sep. 30, 2012
GS&T Plan
May 31, 2012
GS&T Plan
Directors
May 31, 2011
GS&T Plan
Directors
May 17, 2012
GS&T Plan
Directors
May 12, 2011
GS&T Plan
Directors
Sep. 30, 2012
Baltic Trading Plan
Baltic Trading Limited
May 31, 2012
Baltic Trading Plan
Baltic Trading Limited
Directors
May 31, 2011
Baltic Trading Plan
Baltic Trading Limited
Directors
May 17, 2012
Baltic Trading Plan
Baltic Trading Limited
Directors
May 13, 2011
Baltic Trading Plan
Baltic Trading Limited
Directors
Cash flow information
 
 
 
 
 
 
 
 
 
 
Nonvested common stock granted (in shares)
15,000 
15,000 
15,000 
 
 
12,500 
12,500 
12,500 
 
 
Fair value of nonvested stock
 
 
 
$ 53 
$ 120 
 
 
 
$ 48 
$ 87 
VESSEL ACQUISITIONS AND DISPOSITIONS (Details) (USD $)
3 Months Ended 9 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 8 Months Ended 8 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
$253 million term loan facility
Aug. 20, 2010
$253 million term loan facility
vessel
Sep. 30, 2012
$100 million term loan facility
Aug. 12, 2010
$100 million term loan facility
Jun. 3, 2010
$100 million term loan facility
vessel
Sep. 30, 2012
5.00% convertible senior notes
Jul. 27, 2010
5.00% convertible senior notes
Jun. 24, 2010
Master Agreement between GS&T and Bourbon
vessel
Jun. 3, 2010
Purchase agreement between GS&T and Metrostar companies
vessel
Mar. 29, 2011
Genco Rhone
Master Agreement between GS&T and Bourbon
item
Mar. 31, 2011
Genco Rhone
Master Agreement between GS&T and Bourbon
$253 million term loan facility
Mar. 30, 2011
Genco Rhone
Master Agreement between GS&T and Bourbon
$253 million term loan facility
Mar. 29, 2011
Genco Rhone
Master Agreement between GS&T and Bourbon
5.00% convertible senior notes
Sep. 30, 2012
Newbuilding contract
Sep. 30, 2011
Newbuilding contract
Sep. 30, 2012
Newbuilding contract
Sep. 30, 2011
Newbuilding contract
Jun. 30, 2011
Genco Avra
May 12, 2011
Genco Avra
Purchase agreement between GS&T and Metrostar companies
item
Jul. 20, 2011
Genco Mare
Purchase agreement between GS&T and Metrostar companies
item
Dec. 31, 2011
Genco Spirit
Nov. 10, 2011
Genco Spirit
Purchase agreement between GS&T and Metrostar companies
item
Dec. 31, 2011
Genco Avra, Genco Mare and Genco Spirit
Purchase agreement between GS&T and Metrostar companies
May 12, 2011
Genco Avra, Genco Mare and Genco Spirit
Purchase agreement between GS&T and Metrostar companies
Jun. 3, 2010
Genco Avra, Genco Mare and Genco Spirit
Purchase agreement between GS&T and Metrostar companies
vessel
Dec. 31, 2011
Genco Avra, Genco Mare and Genco Spirit
Purchase agreement between GS&T and Metrostar companies
$100 million term loan facility
VESSEL ACQUISITIONS AND DISPOSITIONS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capacity of vessels
 
 
 
 
 
 
 
 
 
 
 
 
 
58,000 
 
 
 
 
 
 
 
 
34,400 
34,400 
 
34,400 
 
 
 
 
Number of vessels purchased
 
 
 
 
 
13 
 
 
 
 
13 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total purchase price
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 35,700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
5.00% 
5.00% 
 
 
 
 
 
5.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
Face amount of term loan facility
 
 
 
 
253,000,000 
253,000,000 
100,000,000 
100,000,000 
 
 
 
 
 
 
 
253,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amount borrowed
 
 
 
 
253,000,000 
 
100,000,000 
 
 
 
 
 
 
 
21,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60,000,000 
Number of last vessels delivered pursuant to agreement
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash utilized to pay liability for vessels acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
29,800,000 
 
 
 
Remaining liability for vessels acquired, before repayment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
89,800,000 
 
 
Liability for time charter acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
372,000 
 
 
205,000 
 
 
 
 
 
Amortization of time charters acquired
187,000 
463,000 
558,000 
1,432,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capitalized interest associated with newbuilding contracts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 0 
$ 33,000 
$ 0 
$ 165,000 
 
 
 
 
 
 
 
 
 
INVESTMENTS (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
Investments
 
 
Fair value of investment in capital stock
$ 23,825 
$ 24,468 
Jinhui Shipping and Transportation Limited
 
 
Investments
 
 
Investment in the capital stock of Jinhui (in shares)
16,335,100 
16,335,100 
Fair value of investment in capital stock
$ 23,825 
$ 24,468 
NET (LOSS) INCOME PER COMMON SHARE (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
NET (LOSS) INCOME PER COMMON SHARE
 
 
 
 
Nonvested shares outstanding
935,287 
 
935,287 
 
Anti-dilutive shares
 
 
935,287 
 
Common shares outstanding, basic:
 
 
 
 
Weighted average common shares outstanding-basic
42,885,810 
35,157,110 
41,290,719 
35,149,912 
Common shares outstanding, diluted:
 
 
 
 
Weighted average common shares outstanding-basic
42,885,810 
35,157,110 
41,290,719 
35,149,912 
Dilutive effect of restricted stock awards (in shares)
 
55,730 
 
62,129 
Weighted average common shares outstanding-diluted
42,885,810 
35,212,840 
41,290,719 
35,212,041 
Reconciliation of the net (loss) income attributable to GS&T and the net income attributable to GS&T for diluted earnings per share
 
 
 
 
Net (loss) income attributable to GS&T
$ (38,449)
$ 1,562 
$ (99,289)
$ 25,080 
Net (loss) income attributable to GS&T for the computation of diluted net (loss) income per share
$ (38,449)
$ 1,562 
$ (99,289)
$ 25,080 
RELATED PARTY TRANSACTIONS (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
GMC
Sep. 30, 2011
GMC
Dec. 31, 2011
GMC
Sep. 30, 2012
Constantine Georgiopoulos
Sep. 30, 2011
Constantine Georgiopoulos
Dec. 31, 2011
Constantine Georgiopoulos
Sep. 30, 2012
NSM
Sep. 30, 2011
NSM
Sep. 30, 2012
Aegean
Sep. 30, 2011
Aegean
Dec. 31, 2011
Aegean
Sep. 30, 2012
MEP
Sep. 30, 2011
MEP
Dec. 31, 2011
MEP
Related party transactions
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue from related party
$ 828 
$ 828 
$ 2,466 
$ 2,457 
 
 
 
 
 
 
 
 
 
 
 
$ 2,466 
$ 2,457 
 
Expenses incurred from transactions with related party
 
 
 
 
45 
168 
 
16 
38 
 
1,170 
1,342 
 
 
 
 
Amount due to the entity from a related party
 
 
 
 
21 
 
114 
 
 
 
 
 
 
 
 
 
Reserve kept pursuant to bankruptcy proceedings of the related party
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
 
 
Amount due to the related party
 
 
 
 
 
 
 
16 
 
29 
 
 
98 
 
408 
 
 
 
Amount invoiced for services performed and expenses paid
 
 
 
 
$ 140 
$ 136 
 
 
 
 
 
 
 
 
 
$ 2,541 
$ 2,514 
 
LONG-TERM DEBT (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 1 Months Ended 9 Months Ended 1 Months Ended 9 Months Ended 1 Months Ended 1 Months Ended 12 Months Ended 1 Months Ended
Feb. 29, 2012
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2011
Aug. 31, 2012
August 2012 Agreements
item
Sep. 30, 2012
Minimum
Sep. 30, 2011
Minimum
Sep. 30, 2012
Minimum
Sep. 30, 2011
Minimum
Sep. 30, 2012
Maximum
Sep. 30, 2011
Maximum
Sep. 30, 2012
Maximum
Sep. 30, 2011
Maximum
Aug. 31, 2012
Maximum
August 2012 Agreements
Feb. 29, 2012
2007 Credit Facility
Dec. 31, 2011
2007 Credit Facility
Sep. 30, 2012
2007 Credit Facility
Aug. 31, 2012
2007 Credit Facility
August 2012 Agreements
Aug. 1, 2012
2007 Credit Facility
August 2012 Agreements
Aug. 1, 2012
2007 Credit Facility
Minimum
August 2012 Agreements
Sep. 30, 2012
$100 Million Term Loan Facility
Dec. 31, 2011
$100 Million Term Loan Facility
Aug. 12, 2010
$100 Million Term Loan Facility
Jun. 3, 2010
$100 Million Term Loan Facility
vessel
Aug. 31, 2012
$100 Million Term Loan Facility
August 2012 Agreements
Aug. 1, 2012
$100 Million Term Loan Facility
August 2012 Agreements
Sep. 30, 2012
$253 Million Term Loan Facility
Dec. 31, 2011
$253 Million Term Loan Facility
Aug. 20, 2010
$253 Million Term Loan Facility
vessel
Aug. 31, 2012
$253 Million Term Loan Facility
August 2012 Agreements
Aug. 1, 2012
$253 Million Term Loan Facility
August 2012 Agreements
May 31, 2011
2010 Baltic Trading Credit Facility
item
Dec. 31, 2010
2010 Baltic Trading Credit Facility
Sep. 30, 2012
2010 Baltic Trading Credit Facility
May 31, 2012
2010 Baltic Trading Credit Facility
Dec. 31, 2011
2010 Baltic Trading Credit Facility
Nov. 30, 2010
2010 Baltic Trading Credit Facility
Apr. 16, 2010
2010 Baltic Trading Credit Facility
Aug. 31, 2012
2007 Credit Facility, $100 Million Term Loan Facility, and $253 Million Term Loan Facility
August 2012 Agreements
Aug. 1, 2012
$100 Million Term Loan Facility and $253 Million Term Loan Facility
August 2012 Agreements
Long-term debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt, gross
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,174,500 
$ 1,055,912 
 
 
 
$ 75,484 
$ 90,869 
 
 
 
 
$ 180,793 
$ 221,393 
 
 
 
 
 
$ 101,250 
 
$ 101,250 
 
 
 
 
Less: Current portion
 
 
 
 
 
(185,077)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt
 
1,413,439 
 
1,413,439 
 
1,402,935 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of credit facilities with prepaid scheduled amortization payments through December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Aggregate principal amount to be paid in the first quarter of 2014 under facilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
55,193 
Minimum cash balances necessary to repay credit facility on a quarterly basis commencing September 30, 2012
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of repayments commencing September 30, 2012 to be allocated to the final payment at maturity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of repayments commencing September 30, 2012 to be allocated to the scheduled mandatory principal repayments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
75.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Appraised value of certain mortgaged vessels as percentage of the aggregate principal amount for ceasing of mandatory payment obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of credit facilities that will not increase the amount of principal indebtedness outstanding or change their maturity dates
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of indebtedness allowed to be incurred for vessel acquisitions as percentage of the lesser of the vessel acquisition cost or fair market value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reference rate for interest payable
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Applicable margin over reference rate for interest payable, before increase (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Applicable margin over reference rate for interest payable (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Minimum cash balance required per vessel mortgaged, before increase
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
500 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Minimum cash balance required per vessel mortgaged
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
750 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of credit facilities with vessels pledged being granted a second priority security interest
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of credit facilities in which the consenting lenders received an upfront fee
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of upfront fee received by consenting lenders
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.25% 
 
Amount prepaid
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
57,893 
 
 
 
 
 
 
11,538 
 
 
 
 
30,450 
 
 
 
 
 
 
 
 
 
 
Prepayment fee (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.25% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term interest payable
 
13,199 
 
13,199 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
13,199 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maximum borrowing capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,055,912 
 
 
 
100,000 
 
100,000 
 
 
100,000 
253,000 
 
253,000 
 
253,000 
 
 
 
135,000 
 
150,000 
100,000 
 
 
Amount of drawdowns
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000 
 
 
 
 
 
253,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Facility fee (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
2.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reduction in facility fee if equity offering results in desired gross proceeds (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Proceeds to be received on issuance of common stock
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
50,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
7,500,000 
 
 
7,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
7,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross proceeds from issuance of common stock
 
 
 
50,721 
 
 
 
 
 
 
 
 
 
 
 
 
53,250 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Drawdowns during the period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,500 
 
 
 
 
 
 
 
Remaining borrowing capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
33,750 
 
 
 
 
 
 
Number of consecutive semi-annual reductions in total commitment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11 
 
 
 
 
 
 
 
 
Amount of semi-annual reductions in maximum borrowing capacity through the maturity date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,000 
 
 
 
 
 
 
 
 
Number of vessels purchased
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
13 
 
 
 
 
 
 
 
 
 
 
 
Available working capital borrowings
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 23,500 
 
 
 
 
 
 
Interest rates
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective Interest Rate (as a percent)
 
4.65% 
4.36% 
4.60% 
4.41% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Range of Interest Rates (excluding impact of swaps and unused commitment fees) (as a percent)
 
 
 
 
 
 
 
3.22% 
2.25% 
3.22% 
2.19% 
4.50% 
3.33% 
4.63% 
3.33% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CONVERTIBLE SENIOR NOTES (Details) (USD $)
In Thousands, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended
Jul. 31, 2010
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2011
Jul. 27, 2010
Convertible senior notes
 
 
 
 
 
 
 
Net carrying amount of the liability component
 
$ 109,726 
 
$ 109,726 
 
$ 106,381 
 
Non-cash interest expense recognized
 
 
 
3,345 
2,999 
 
 
Non-cash deferred financing amortization costs included in interest expense
 
1,596 
796 
3,555 
2,368 
 
 
2010 Notes
 
 
 
 
 
 
 
Convertible senior notes
 
 
 
 
 
 
 
2010 Notes issued
125,000 
 
 
 
 
 
 
Interest rate on convertible notes (as a percent)
 
5.00% 
 
5.00% 
 
 
5.00% 
Carrying amount of the equity component (additional paid-in capital)
 
24,375 
 
24,375 
 
24,375 
 
Principal amount of the 2010 Notes
 
125,000 
 
125,000 
 
125,000 
 
Unamortized discount of the liability component
 
15,274 
 
15,274 
 
18,619 
 
Net carrying amount of the liability component
 
109,726 
 
109,726 
 
106,381 
 
Effective interest rate on liability component (as a percent)
 
10.00% 
10.00% 
10.00% 
10.00% 
 
 
Cash interest expense recognized
 
1,580 
1,584 
4,696 
4,677 
 
 
Non-cash interest expense recognized
 
1,158 
1,046 
3,345 
2,999 
 
 
Non-cash deferred financing amortization costs included in interest expense
 
$ 181 
$ 181 
$ 540 
$ 538 
 
 
Remaining period over which the unamortized discount will be recognized
 
 
 
2 years 10 months 24 days 
 
 
 
INTEREST RATE SWAP AGREEMENTS (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
item
Dec. 31, 2011
item
INTEREST RATE SWAP AGREEMENTS
 
 
Number of interest rate swap agreements outstanding
Interest rate swaps designated as cash flow hedges
 
 
Notional amount outstanding
$ 356,233 
$ 606,233 
Interest rate swap, with 4.485% fixed rate and start date of 14 September, 2005
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
4.485% 
4.485% 
Notional amount outstanding
106,233 
106,233 
Interest rate swap, with 5.25% fixed rate and start date of 2 January, 2007
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
5.25% 
5.25% 
Notional amount outstanding
50,000 
50,000 
Interest rate swap, with 5.075% fixed rate and start date of 2 January, 2008
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
5.075% 
5.075% 
Notional amount outstanding
50,000 
50,000 
Interest rate swap, with 5.07% fixed rate and start date of 2 January, 2008
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
5.07% 
5.07% 
Notional amount outstanding
 
100,000 
Interest rate swap, with 4.985% fixed rate and start date of 31 March, 2008
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
4.985% 
4.985% 
Notional amount outstanding
 
50,000 
Interest rate swap, with 5.04% fixed rate and start date of 31 March, 2008
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
5.04% 
5.04% 
Notional amount outstanding
 
100,000 
Interest rate swap, with 2.05% fixed rate and start date of 22 January, 2009
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
2.05% 
2.05% 
Notional amount outstanding
100,000 
100,000 
Interest rate swap, with 2.45% fixed rate and start date of 23 February, 2009
 
 
Interest rate swaps designated as cash flow hedges
 
 
Fixed rate (as a percent)
2.45% 
2.45% 
Notional amount outstanding
$ 50,000 
$ 50,000 
INTEREST RATE SWAP AGREEMENTS (Details 2) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
Liability Derivatives
 
 
Fair value of derivative instruments
$ 609 
$ 1,686 
Fair value of derivative instruments (Noncurrent Liabilities)
18,261 
23,654 
Interest rate contracts |
Derivatives designated as hedging instruments
 
 
Liability Derivatives
 
 
Fair value of derivative instruments
609 
1,686 
Fair value of derivative instruments (Noncurrent Liabilities)
18,261 
23,654 
Total Derivatives
$ 18,870 
$ 25,340 
INTEREST RATE SWAP AGREEMENTS (Details 3) (Interest rate contracts, Derivatives in cash flow hedging relationships, USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
vessel
Sep. 30, 2011
Sep. 30, 2012
vessel
Sep. 30, 2011
Interest rate contracts |
Derivatives in cash flow hedging relationships
 
 
 
 
Impact of derivative instruments and their location within Condensed Consolidated Statement of Operations
 
 
 
 
Amount of Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)
$ (1,434)
$ (5,021)
$ (3,999)
$ (11,705)
Amount of Gain (Loss) Reclassified from AOCI into income (Effective Portion)
2,959 
7,438 
10,392 
22,038 
Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
30 
18 
76 
38 
Amount of AOCI expected to be reclassified into interest expense over the next 12 months
(10,082)
 
(10,082)
 
Number of vessels mortgaged
35 
 
35 
 
Aggregate amount of collateral
$ 100,000 
 
$ 100,000 
 
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Net Unrealized Gain (Loss) on Cash Flow Hedges
 
 
 
 
Balance at the beginning of the period
 
 
$ (25,245)
 
Unrealized gain on cash flow hedges, net
1,525 
2,417 
6,394 
10,333 
Balance at the end of the period
(18,851)
 
(18,851)
 
Unrealized Gain on Investments
 
 
 
 
Balance at the beginning of the period
 
 
7,696 
 
Change in unrealized gain on investments
(3,561)
(14,602)
(643)
(26,866)
Balance at the end of the period
7,053 
 
7,053 
 
AOCI
 
 
 
 
Balance at the beginning of the period
 
 
(17,549)
 
Change in unrealized gain on investments
(3,561)
(14,602)
(643)
(26,866)
Unrealized gain on cash flow hedges, net
1,525 
2,417 
6,394 
10,333 
Balance at the end of the period
$ (11,798)
 
$ (11,798)
 
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
Sep. 30, 2012
$100 Million Term Loan Facility
Dec. 31, 2011
$100 Million Term Loan Facility
Aug. 12, 2010
$100 Million Term Loan Facility
Aug. 1, 2012
$100 Million Term Loan Facility
August 2012 Agreements
Sep. 30, 2012
$253 Million Term Loan Facility
Dec. 31, 2011
$253 Million Term Loan Facility
Aug. 20, 2010
$253 Million Term Loan Facility
Aug. 1, 2012
$253 Million Term Loan Facility
August 2012 Agreements
Sep. 30, 2012
Carrying Value
Dec. 31, 2011
Carrying Value
Sep. 30, 2012
Fair value
Dec. 31, 2011
Fair value
Fair value of financial instruments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
 
 
 
 
 
 
 
 
 
$ 87,778 
$ 227,968 
$ 87,778 
$ 227,968 
Restricted cash
10,150 
9,750 
 
 
 
 
 
 
 
 
10,150 
9,750 
10,150 
9,750 
Floating rate debt
 
 
75,484 
90,869 
 
 
180,793 
221,393 
 
 
1,413,439 
1,588,012 
1,413,439 
1,588,012 
2010 Notes
 
 
 
 
 
 
 
 
 
 
109,726 
106,381 
48,750 
80,000 
Face amount of term loan facility
 
 
$ 100,000 
 
$ 100,000 
$ 100,000 
$ 253,000 
 
$ 253,000 
$ 253,000 
 
 
 
 
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 2) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2012
Dec. 31, 2011
Total
 
 
Fair value of financial instruments
 
 
Investments
$ 23,825 
$ 24,468 
Derivative instruments - liability position
18,870 
25,340 
Quoted market prices in active markets (Level 1)
 
 
Fair value of financial instruments
 
 
Investments
23,825 
24,468 
Significant Other Observable Inputs (Level 2)
 
 
Fair value of financial instruments
 
 
Derivative instruments - liability position
$ 18,870 
$ 25,340 
Period to determine fair value inputs for valuation
2 years 
 
PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
PREPAID EXPENSES AND OTHER CURRENT AND NONCURRENT ASSETS
 
 
Lubricant inventory, fuel oil and diesel oil inventory and other stores
$ 10,321 
$ 10,376 
Prepaid items
4,621 
5,514 
Insurance receivable
860 
1,025 
Other
1,218 
794 
Total prepaid expenses and other current assets
17,020 
17,709 
Security deposit related to operating lease included in other noncurrent assets
$ 514 
$ 514 
OTHER ASSETS, NET (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2011
Sep. 30, 2012
2010 Notes
Sep. 30, 2011
2010 Notes
Sep. 30, 2012
2010 Notes
Sep. 30, 2011
2010 Notes
Dec. 31, 2011
2010 Notes
Sep. 30, 2012
2007 Credit Facility
Dec. 31, 2011
2007 Credit Facility
Sep. 30, 2012
$100 Million Term Loan Facility
Dec. 31, 2011
$100 Million Term Loan Facility
Aug. 12, 2010
$100 Million Term Loan Facility
Sep. 30, 2012
$253 Million Term Loan Facility
Dec. 31, 2011
$253 Million Term Loan Facility
Aug. 20, 2010
$253 Million Term Loan Facility
Sep. 30, 2012
2010 Baltic Trading Credit Facility
May 31, 2012
2010 Baltic Trading Credit Facility
Dec. 31, 2011
2010 Baltic Trading Credit Facility
Nov. 30, 2010
2010 Baltic Trading Credit Facility
Apr. 16, 2010
2010 Baltic Trading Credit Facility
Other assets, net
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maximum borrowing capacity
 
 
 
 
 
 
 
 
 
 
$ 1,055,912 
 
$ 100,000 
 
$ 100,000 
$ 253,000 
 
$ 253,000 
 
$ 135,000 
 
$ 150,000 
$ 100,000 
Total deferred financing costs
43,211 
 
43,211 
 
25,544 
3,637 
 
3,637 
 
3,637 
29,923 
13,189 
1,822 
1,578 
 
4,802 
4,113 
 
3,027 
 
3,027 
 
 
Less: accumulated amortization
11,304 
 
11,304 
 
7,749 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
31,907 
 
31,907 
 
17,795 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortization of deferred financing costs
$ 1,596 
$ 796 
$ 3,555 
$ 2,368 
 
$ 181 
$ 181 
$ 540 
$ 538 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FIXED ASSETS (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2011
FIXED ASSETS
 
 
 
 
 
Fixed assets, gross
$ 8,479 
 
$ 8,479 
 
$ 8,013 
Less: accumulated depreciation and amortization
3,077 
 
3,077 
 
2,422 
Total
5,402 
 
5,402 
 
5,591 
Depreciation and amortization expense
35,038 
34,378 
103,954 
101,484 
 
Property, plant, and equipment excluding vessels
 
 
 
 
 
FIXED ASSETS
 
 
 
 
 
Depreciation and amortization expense
230 
124 
655 
372 
 
Vessel equipment
 
 
 
 
 
FIXED ASSETS
 
 
 
 
 
Fixed assets, gross
2,973 
 
2,973 
 
2,720 
Leasehold improvements
 
 
 
 
 
FIXED ASSETS
 
 
 
 
 
Fixed assets, gross
3,823 
 
3,823 
 
3,664 
Furniture and fixtures
 
 
 
 
 
FIXED ASSETS
 
 
 
 
 
Fixed assets, gross
997 
 
997 
 
997 
Computer equipment
 
 
 
 
 
FIXED ASSETS
 
 
 
 
 
Fixed assets, gross
$ 686 
 
$ 686 
 
$ 632 
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2012
Dec. 31, 2011
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
 
 
Accounts payable
$ 3,691 
$ 5,047 
Accrued general and administrative expenses
10,115 
14,275 
Accrued vessel operating expenses
11,344 
11,390 
Total
$ 25,150 
$ 30,712 
REVENUE FROM TIME CHARTERS (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
item
Sep. 30, 2011
REVENUE FROM TIME CHARTERS
 
 
 
 
Voyage revenues
$ 53,603 
$ 93,484 
$ 174,740 
$ 292,614 
Profit sharing revenue
121 
Future minimum time charter revenue
 
 
 
 
Remainder of 2012
11,480 
 
11,480 
 
2013
15,405 
 
15,405 
 
2014
$ 3,512 
 
$ 3,512 
 
Offhire period
 
 
20 days 
 
Number of vessels excluded from disclosure of future minimum revenue
 
 
 
COMMITMENTS AND CONTINGENCIES (Details) (USD $)
In Thousands, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended
Sep. 30, 2012
Dec. 31, 2011
Sep. 30, 2005
Lease agreement entered into September 2005
Sep. 30, 2012
Lease agreement entered into September 2005
Sep. 30, 2011
Lease agreement entered into September 2005
Sep. 30, 2012
Lease agreement entered into September 2005
Sep. 30, 2011
Lease agreement entered into September 2005
Sep. 30, 2012
Lease agreement entered into April 2011
Sep. 30, 2011
Lease agreement entered into April 2011
Sep. 30, 2012
Lease agreement entered into April 2011
Sep. 30, 2011
Lease agreement entered into April 2011
Dec. 31, 2011
Lease agreement entered into April 2011
Sep. 30, 2012
Lease agreement entered into April 2011
Period during June 1, 2011 to September 30, 2025
Apr. 30, 2011
Sub-sublease agreement
Sep. 30, 2012
Sub-sublease agreement
Period until May 31, 2015
Sep. 30, 2012
Sub-sublease agreement
Period after May 31, 2015 until expiration of lease term
Sep. 30, 2012
Direct lease agreement
Period from October 1, 2018 to April 30, 2023
Sep. 30, 2012
Direct lease agreement
Period from May 1, 2023 to September 30, 2025
Commitments and contingencies
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Lease term
 
 
15 years 
 
 
 
 
 
 
 
 
 
 
7 years 
 
 
 
 
Monthly rental expense
 
 
 
 
 
 
 
 
 
 
 
 
$ 130 
 
 
 
 
 
Monthly rental payment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
82 
90 
186 
204 
Long-term lease obligations
2,056 
1,823 
 
 
 
 
 
1,649 
 
1,649 
 
1,217 
 
 
 
 
 
 
Rent expense
 
 
 
255 
117 
826 
350 
389 
389 
1,168 
519 
 
 
 
 
 
 
 
Future minimum rental payments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Remainder of 2012
 
 
 
129 
 
129 
 
245 
 
245 
 
 
 
 
 
 
 
 
2013
 
 
 
518 
 
518 
 
982 
 
982 
 
 
 
 
 
 
 
 
2014
 
 
 
518 
 
518 
 
982 
 
982 
 
 
 
 
 
 
 
 
2015
 
 
 
518 
 
518 
 
1,037 
 
1,037 
 
 
 
 
 
 
 
 
2016
 
 
 
529 
 
529 
 
1,076 
 
1,076 
 
 
 
 
 
 
 
 
Remaining term of the lease
 
 
 
2,522 
 
2,522 
 
17,582 
 
17,582 
 
 
 
 
 
 
 
 
Obligation of sublessor towards the cost of alterations of office space
 
 
 
 
 
 
 
 
 
$ 472 
 
 
 
 
 
 
 
 
NONVESTED STOCK AWARDS (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Number of Shares
 
 
Forfeited (in shares)
(1,500)
(1,100)
Balance at the end of the period (in shares)
935,287 
 
GS&T Plan
 
 
Number of Shares
 
 
Balance at the beginning of the period (in shares)
936,787 
 
Granted (in shares)
15,000 
 
Vested (in shares)
(15,000)
 
Forfeited (in shares)
(1,500)
 
Balance at the end of the period (in shares)
935,287 
 
Weighted Average Grant Date Price
 
 
Balance at the beginning of the period (in dollars per share)
$ 14.06 
 
Granted (in dollars per share)
$ 3.50 
 
Vested (in dollars per share)
$ 8.00 
 
Forfeited (in dollars per share)
$ 6.39 
 
Balance at the end of the period (in dollars per share)
$ 14.00 
 
Additional disclosures
 
 
Total fair value of shares vested
$ 53 
$ 120 
Unrecognized compensation cost related to nonvested stock awards
 
 
Unrecognized future compensation cost
4,800 
 
Weighted-average period for recognition of unrecognized compensation cost
2 years 11 months 5 days 
 
Baltic Trading Plan |
Baltic Trading Limited
 
 
Number of Shares
 
 
Balance at the beginning of the period (in shares)
545,750 
 
Granted (in shares)
12,500 
 
Vested (in shares)
(129,000)
 
Balance at the end of the period (in shares)
429,250 
 
Weighted Average Grant Date Price
 
 
Balance at the beginning of the period (in dollars per share)
$ 11.60 
 
Granted (in dollars per share)
$ 3.86 
 
Vested (in dollars per share)
$ 13.31 
 
Balance at the end of the period (in dollars per share)
$ 10.86 
 
Additional disclosures
 
 
Total fair value of shares vested
505 
1,131 
Unrecognized compensation cost related to nonvested stock awards
 
 
Unrecognized future compensation cost
$ 1,434 
 
Weighted-average period for recognition of unrecognized compensation cost
1 year 11 months 16 days 
 
NONVESTED STOCK AWARDS (Details 2) (General, administrative and management fees, USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
GS&T Plan
 
 
 
 
NONVESTED STOCK AWARDS
 
 
 
 
Recognized nonvested stock amortization expense
$ 1,069 
$ 1,472 
$ 3,214 
$ 4,443 
Baltic Trading Plan |
Baltic Trading Limited
 
 
 
 
NONVESTED STOCK AWARDS
 
 
 
 
Recognized nonvested stock amortization expense
$ 403 
$ 623 
$ 1,377 
$ 2,174 
SHARE REPURCHASE PROGRAM (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2012
SHARE REPURCHASE PROGRAM
 
Shares of common stock repurchased and retired
278,300 
Value of shares of common stock repurchased and retired
$ 11,500 
SUBSEQUENT EVENTS (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 1 Months Ended
Sep. 30, 2012
Oct. 31, 2012
Subsequent events
Baltic Trading Limited
Oct. 31, 2012
Subsequent events
Baltic Trading Limited
Minority shareholders
Subsequent Events
 
 
 
Dividends declared per share (in dollars per share)
$ 0 
$ 0.01 
 
Aggregate amount of the dividend
 
$ 227 
$ 170