MPC Container Ships ASA (‘MPCC’ or the ‘Company’, and together with its subsidiaries, the ‘Group’) is pleased to announce the following company update. The company update includes the Charter update on existing fleet.
The update includes the following:
- Over the past weeks, MPCC has concluded five additional fixtures, including four multi-year charters at very favourable rates, securing employment up to 2027.
- The new fixtures add contracted charter revenues to the tune of USD 220 million, with additional projected EBITDA backlog of USD 180 million.
- MPCC executes on an extraordinary opportunity to expand fleet with eco-design 5,500 TEU vessels.
- MPCC orders two 5,500 TEU wide beam eco-design vessels with attractive charters, to ZIM Integrated Shipping Services at favourable pricing, thereby supporting long-term earnings visibility and distribution capacity.
- The newbuildings are contracted with Korean-based shipyard - HJ Shipbuilding & Construction and delivery is expected in early 2024.
- The transaction adds contracted charter revenues up to USD 178 million and additional projected EBITDA backlog of USD 138 million.
- The contract price of USD 72,2 million per vessel is covered by the expected cash flow from the initial charter of 7 years, with a significantly front-loaded cash flow, at an average TC of USD ~39,000/day.
- This commitment to newbuilds will have no negative impact on expected distributions in 2022 and 2023, but will support earnings visibility and accretive distribution potential from 2024 and onwards.
- The newbuilds will offer significant trading benefits, under the new environmental regulation, and improve the environmental footprint of the MPCC fleet.
Multi-year charter fixtures on MPCC’s operating fleet
We are pleased to announce the conclusion of additional multi-year charter fixtures on our operating fleet"
MPC Container Ships ASA’s Chief Executive Officer (CEO), Constantin Baack commented in relation to the announcement, “Adhering to MPCC’s value strategy, rational decision making and capital allocation, we are pleased to announce the conclusion of additional multi-year charter fixtures on our operating fleet, proving the continued strength in our segments.”
Constantin Baack adds, “This is also supported by the execution of this extraordinary newbuilding opportunity, as we have ordered two eco-design newbuilding, with attractive charters attached, which fully mitigates residual value risk over its initial charter period, and thereafter, provides for significant upside potential. This transaction increases the distribution potential in 2024 and onwards, without any impact on the expected distributions from our existing fleet.”
Executing transactions in line with de-carbonisation regulations
He further said, “This transaction demonstrates the Company’s capability to identify and execute transactions that are both accretive, in terms of earnings and environmental footprint, in line with upcoming de-carbonisation regulations. We will continue to execute on our distribution policy to shareholders, while creating value by seizing selective growth opportunities, as they arise.”