UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13A-16 OR 15D-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2018

Commission File Number: 001-36202

 

 

NAVIGATOR HOLDINGS LTD

(Translation of registrant’s name into English)

 

 

c/o NGT Services (UK) Ltd

10 Bressenden Place, London, SW1E 5DH

United Kingdom

(Address of principal executive office)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F  ☒            Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐.

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐.

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

 

 

 


INFORMATION CONTAINED IN THIS FORM 6-K REPORT

Attached to this Report on Form 6-K as Exhibit 1 is a copy of the press release issued by Navigator Holdings Ltd. on November 12, 2018: Navigator Holdings Ltd. Preliminary Results for the Three and Nine Months Ended September 30, 2018.


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

    NAVIGATOR HOLDINGS LTD.
Date: November 13, 2018     By:   /s/ Niall Nolan
    Name:   Niall Nolan
    Title:   Chief Financial Officer
Exhibit 1

Exhibit 1

Navigator Holdings Ltd.

Preliminary Results for the Three and Nine Months Ended September 30, 2018

Highlights

 

   

Navigator Holdings Ltd. (the “Company”) reported operating revenue of $80.8 million for the three months ended September 30, 2018, an increase from $70.2 million for the three months ended September 30, 2017.

 

   

Net income was $0.6 million (earnings per share of $0.01) for the three months ended September 30, 2018, compared to a net loss of $1.1 million (loss per share of $0.02) for the three months ended September 30, 2017.

 

   

EBITDA1 was $30.4 million for the three months ended September 30, 2018, an increase from $27.1 million for the three months ended September 2017.

 

   

During the three months ended September 30, 2018, the Company made an additional capital contribution of $15.0 million to our 50/50 joint venture (the “Export Terminal Joint Venture”) relating to the ethylene export marine terminal (the “Marine Export Terminal”), taking the total invested in the joint venture to date to $25.0 million. The Marine Export Terminal is expected to become operational in approximately one year.

 

   

On November 2, 2018, the Company issued senior secured bonds in an aggregate principal amount of 600 million Norwegian Kroner (approximately $72.0 million) with Norsk Tillitsmann ASA as the bond trustee. The net proceeds will be used to partially finance the Company’s portion of the capital cost of construction of the Marine Export Terminal.

 

   

Maintained strong fleet utilization of 87.5% for the three months ended September 30, 2018, up from 85.0% during the third quarter of 2017.

During the third quarter of 2018, we entered into two new time charters for niche LPG trade along the west coasts of South America and Africa, respectively. Additionally, we entered into a new charter for the transportation of two west coast Australia LPG cargoes to South East Asia. We also entered into a one-year renewal of the time charter with Algeria’s state oil company at an approximate 30% increase in charter hire compared to the expiring charter rate. We believe these additional time charter commitments indicate a firming in utilization in the near term, as the market tightens and sentiment improves.

Long haul spot activity across the petrochemical segment (butadiene, crude C4, raffinate and butene-1) continued into the third quarter, with cargoes emanating from North West Europe, the Eastern Mediterranean and from Brazil, into the U.S. Gulf markets with an increasing frequency. There were also long haul voyages to both the Middle East and to Far East Asia concluded from North Europe during this third quarter.

Long haul ethylene activity continued, though this was tempered by the shutdown for maintenance of the only existing U.S. export terminal at Targa, Houston, for the month of September 2018. This shortfall was taken up, however, by ethylene tons moving from North West Europe, the Mediterranean, the Red Sea and the Middle East. Petrochemical voyages achieved charter rates of up to approximately $22,000 per day during the third quarter, whereas rates for standard LPG transportation remained at approximately $15,000 per day. The majority of the assessed earnings estimates from third party brokers are improving across the entire gas carrier industry and the sentiment is positive going forward on the back of a reducing orderbook and incremental volume from infrastructure projects such as the Mariner East II pipeline system on the U.S. East Coast which is expected to become operational in December of this year followed by AltaGas Canada West Coast export terminal during the first quarter of 2019.


Reconciliation of Non-GAAP Financial Measures

The following table sets forth a reconciliation of net income to EBITDA for the three months ended September 30, 2017 and 2018:

 

     (in thousands)  
     September 30,
2017
     September 30,
2018
 

Net (loss)/income

   $ (1,093    $ 623  

Interest expense

     9,426        11,014  

Interest income

     (139      (202

Income taxes

     102        137  

Depreciation and amortization

     18,787        18,846  
  

 

 

    

 

 

 

EBITDA

   $ 27,083      $ 30,418  
  

 

 

    

 

 

 

 

1 

EBITDA is a non-GAAP financial measure. EBITDA represents net income before net interest expense, income taxes and depreciation and amortization. Management believes that EBITDA is useful to investors in evaluating the operating performance of the Company. EBITDA does not represent and should not be considered as an alternative to any financial measure prepared in accordance with U.S. GAAP, and our calculation of EBITDA may not be comparable to that reported by other companies. See the table above for a reconciliation of EBITDA to net (loss) income, our most directly comparable financial measure calculated accordance with U.S. GAAP.

Conference Call Details:

On Tuesday, November 13, 2018, at 9:00 A.M. ET, the Company’s management team will host a conference call to discuss the financial results.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (877) 553-9962 (US Toll Free Dial In), 0(808) 238-0669 (UK Toll Free Dial In) or +44 (0) 2071 928 592 (Standard International Dial In). Please quote “Navigator” to the operator. There will also be a live, and then archived, webcast of the conference call, available through the Company’s website (www.navigatorgas.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

A telephonic replay of the conference call will be available until Tuesday, November 20, 2018, by dialing 1(866) 331-1332 (US Toll Free Dial In), 0(808) 238-0667 (UK Toll Free Dial In) or +44 (0) 3333 009 785 (Standard International Dial In). Access Code: 11870348#

Navigator Gas

Attention: Investor Relations Department

 

New York:

   650 Madison Ave, 25th Floor, New York, NY 10022. Tel: +1 212 355 5893

London:

   10 Bressenden Place, London, SW1E 5DH. Tel: +44 (0)20 7340 4850

About Us

Navigator Holdings Ltd. is the owner and operator of the world’s largest fleet of handysize liquefied gas carriers and a global leader in the seaborne transportation of petrochemical gases, such as ethylene and ethane, liquefied petroleum gas (“LPG”) and ammonia. Navigator’s fleet consists of 38 semi- or fully-refrigerated liquefied gas carriers, 14 of which are ethylene and ethane capable. The Company plays a vital role in the liquefied gas supply chain for energy companies, industrial consumers and commodity traders, with our sophisticated vessels providing an efficient and reliable ‘floating pipeline’ between the parties. We continue to build strong, long-term partnerships based on mutual trust, our depth of technical expertise and a modern versatile fleet.


FORWARD LOOKING STATEMENTS

Statements included in this press release concerning plans and objectives of management for future operations or economic performance, or assumptions related thereto, including our financial forecast, contain forward-looking statements. In addition, we and our representatives may from time to time make other oral or written statements that are also forward-looking statements. Such statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business and the markets in which we operate as described in this press release. In some cases, you can identify the forward-looking statements by the use of words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,” “forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue,” or the negative of these terms or other comparable terminology. These risks and uncertainties include, but are not limited to:

 

   

future operating or financial results;

 

   

pending acquisitions, business strategy and expected capital spending;

 

   

operating expenses, availability of crew, number of off-hire days, drydocking requirements and insurance costs;

 

   

fluctuations in currencies and interest rates;

 

   

general market conditions and shipping market trends, including charter rates and factors affecting supply and demand;

 

   

our financial condition and liquidity, including our ability to refinance our indebtedness as it matures or obtain additional financing in the future to fund capital expenditures, acquisitions and other corporate activities;

 

   

estimated future capital expenditures needed to preserve our capital base;

 

   

our expectations about the availability of vessels to purchase, the time that it may take to construct new vessels, or the useful lives of our vessels;

 

   

our continued ability to enter into long-term, fixed-rate time charters with our customers;

 

   

changes in governmental rules and regulations or actions taken by regulatory authorities;

 

   

potential liability from future litigation;

 

   

our expectations relating to the payment of dividends;

 

   

our expectation regarding providing in-house technical management for certain vessels in our fleet and our success in providing such in-house technical management;

 

   

our ability to meet our expectations regarding the construction and financing of the Marine Export Terminal and our expectations regarding the financial success of the Marine Export Terminal and the Export Terminal Joint Venture; and

 

   

other factors detailed from time to time in other periodic reports we file with the Securities and Exchange Commission.

All forward-looking statements included in this press release are made only as of the date of this press release. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement. We expressly disclaim any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in our views or expectations, or otherwise. We make no prediction or statement about the performance of our common stock.


Navigator Holdings Ltd.

Condensed Consolidated Balance Sheets

(Unaudited)

 

     December 31,
2017
    September 30,
2018
 
     (in thousands except share data)  

Assets

    

Current assets

    

Cash and cash equivalents

   $ 62,109     $ 50,458  

Accounts receivable, net

     14,889       13,800  

Accrued income

     15,791       6,817  

Prepaid expenses and other current assets

     11,340       16,302  

Bunkers and lubricant oils

     8,008       10,550  
  

 

 

   

 

 

 

Total current assets

     112,137       97,927  

Non-current assets

    

Vessels in operation, net

     1,740,139       1,688,011  

Investment in equity accounted joint venture

           25,994  

Property, plant and equipment, net

     1,611       1,363  
  

 

 

   

 

 

 

Total non-current assets

     1,741,750       1,715,368  
  

 

 

   

 

 

 

Total assets

   $ 1,853,887     $ 1,813,295  
  

 

 

   

 

 

 

Liabilities and stockholders’ equity

    

Current liabilities

    

Current portion of secured term loan facilities, net of deferred financing costs

   $ 81,559     $ 70,261  

Accounts payable

     8,071       7,258  

Accrued expenses and other liabilities

     12,478       16,669  

Accrued interest

     3,500       1,779  

Deferred income

     4,824       7,708  
  

 

 

   

 

 

 

Total current liabilities

     110,432       103,675  
  

 

 

   

 

 

 

Non-current liabilities

    

Secured term loan facilities, net of current portion and deferred financing costs

     681,658       651,918  

Senior unsecured bond, net of deferred financing costs

     98,584       98,925  
  

 

 

   

 

 

 

Total non-current liabilities

     780,242       750,843  
  

 

 

   

 

 

 

Total liabilities

     890,674       854,518  

Commitments and contingencies

    

Stockholders’ equity

    

Common stock—$.01 par value; 400,000,000 shares authorized; 55,656,304 shares issued and outstanding, (2017: 55,529,762)

     555       557  

Additional paid-in capital

     589,436       590,199  

Accumulated other comprehensive loss

     (277     (286

Retained earnings

     373,499       368,307  
  

 

 

   

 

 

 

Total stockholders’ equity

     963,213       958,777  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 1,853,887     $ 1,813,295  
  

 

 

   

 

 

 


Navigator Holdings Ltd.

Condensed Consolidated Statements of Income

(Unaudited)

 

    

Three months ended

September 30,

(in thousands except share data)

   

Nine months ended

September 30,

(in thousands except share data)

 
     2017     2018     2017     2018  

Revenues

        

Operating revenue

   $ 70,211     $ 80,843     $ 221,911     $ 231,813  
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses

        

Brokerage commissions

     1,191       1,434       4,105       3,793  

Voyage expenses

     12,246       17,251       40,761       46,158  

Vessel operating expenses

     25,106       26,873       74,012       79,624  

Depreciation and amortization

     18,787       18,846       54,725       57,256  

General and administrative costs

     3,932       4,176       10,262       12,225  

Other corporate expenses

     653       691       1,605       1,901  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     61,915       69,271       185,470       200,957  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     8,296       11,572       36,441       30,856  

Other income/(expense)

        

Interest expense

     (9,426     (11,014     (27,724     (32,891

Write off of deferred financing costs

                 (1,281      

Write off of call premium and redemption charges on 9% unsecured bond

                 (3,517      

Interest income

     139       202       371       561  
  

 

 

   

 

 

   

 

 

   

 

 

 

(Loss)/income before income taxes

     (991     760       4,290       (1,474

Income taxes

     (102     (137     (391     (366
  

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss)/income

   $ (1,093   $ 623     $ 3,899     $ (1,840
  

 

 

   

 

 

   

 

 

   

 

 

 

(Loss)/Earnings per share:

        

Basic:

   $ (0.02   $ 0.01     $ 0.07     $ (0.03

Diluted:

   $ (0.02   $ 0.01     $ 0.07     $ (0.03
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding:

        

Basic:

     55,531,831       55,656,304       55,531,831       55,620,149  

Diluted:

     55,531,831       56,000,240       55,877,163       55,620,149  
  

 

 

   

 

 

   

 

 

   

 

 

 


Navigator Holdings Ltd.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

     Nine Months ended
September 30, 2017
    Nine Months ended
September 30, 2018
 
     (in thousands)     (in thousands)  

Cash flows from operating activities

    

Net income/(loss)

   $ 3,899     $ (1,840

Adjustments to reconcile net income to net cash provided by operating activities

    

Depreciation and amortization

     54,725       57,256  

Payment of drydocking costs

     (401     (4,875

Adjustment to equity for the adoption of the new revenue standard

           (3,352

Call option premium on redemption of 9.00% unsecured bond

     2,500        

Prior year expenses recovered in insurance claim

     (504     (776

Amortization of share-based compensation

     1,117       765  

Amortization of deferred financing costs

     3,107       1,692  

Unrealized foreign exchange

     243       39  

Changes in operating assets and liabilities

    

Accounts receivable

     (10,090     1,089  

Bunkers and lubricant oils

     (570     (2,542

Prepaid expenses and other current assets

     (125     3,777  

Accounts payable, accrued interest and other liabilities

     (1,946     4,541  
  

 

 

   

 

 

 

Net cash provided by operating activities

     51,955       55,774  
  

 

 

   

 

 

 

Cash flows from investing activities

    

Payment to acquire vessels

     (1,112     69  

Investment in equity accounted joint venture

           (25,994

Payment for vessels under construction

     (124,149      

Purchase of other property, plant and equipment

     (1,623     (120

Receipt of shipyard penalty payments

     280        

Insurance recoveries

     990       1,010  

Placement of short term investment

     (25,000      
  

 

 

   

 

 

 

Net cash used in investing activities

     (150,614     (25,035
  

 

 

   

 

 

 

Cash flows from financing activities

    

Proceeds from secured term loan facilities

     333,983       21,900  

Issuance of 7.75% senior unsecured bonds

     100,000        

Repayment of 9.00% senior unsecured bonds

     (127,500      

Issuance costs of 7.75% senior unsecured bonds

     (1,819      

Direct financing costs of senior term loan facilities

     (2,054      

Repayment of secured term loan facilities

     (226,085     (64,290
  

 

 

   

 

 

 

Net cash provided by/(used in) financing activities

     76,525       (42,390
  

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (22,134     (11,651

Cash and cash equivalents at beginning of period

     57,272       62,109  
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 35,138     $ 50,458  
  

 

 

   

 

 

 

Supplemental Information

    

Total interest paid during the period, net of amounts capitalized

   $ 22,108     $ 33,438  
  

 

 

   

 

 

 

Total tax paid during the period

   $ 428     $ 107