DryShips Inc. (NASDAQ:DRYS) reported first-quarter 2016 results, wherein both earnings and revenues improved year over year. Following the announcement, the company’s shares gained 4.38% to $2.62 per share as of Thursday’s market close.
Quarterly GAAP net income was $54.64 million or $2.05 per share. In the year-ago quarter, the company had reported a loss of $59.23 million or $2.23 per share. On an adjusted basis, loss came in at $20.3 million or 78 cents in the quarter under review. We remind investors that net income included contributions from the company’s 40.4% ownership in Ocean Rig UDW Inc. (NASDAQ:ORIG) , which amounted to $116.5 million.
The company reported negative adjusted EBITDA of $15.6 million in the quarter under review, while total revenue was $11.86 million.
At the end of the first quarter of 2016, DryShips had $5.74 million of cash & cash equivalents, and $269.5 million of outstanding debt on its balance sheet, compared with $15 million and $236.9 million, respectively, at the end of 2015. Meanwhile, the debt-to-capitalization ratio increased to 0.60 from 0.50 at 2015 end.
Reverse Stock Split
First-quarter 2016 data reflect the effect of the 1-to-25 reverse stock split which was approved by the company’s board on Feb 19. As a result of the reverse stock split, the number of DryShips’ outstanding shares fell from approximately 672 million to 26.9 million.
With the entire shipping industry under pressure due to low freight rates, overcapacity, a dearth of bank financing and the sluggishness in Chinese import of coal and iron ore, several companies like Scorpio Bulkers Inc. (NYSE:SALT) and Star Bulk Carriers (NASDAQ:SBLK) are also resorting to reverse stock splits in order to stay listed on the exchange.
STAR BULK CARRS (SBLK): Free Stock Analysis Report
OCEAN RIG UDW (ORIG): Free Stock Analysis Report
SCORPIO BULKERS (SALT): Free Stock Analysis Report
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