DRYSHIPS INC

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 March 2013


Commission File Number 001-33922


DRYSHIPS INC.


80 Kifissias Avenue

Amaroussion 15125, Athens Greece

(Address of principal executive offices)


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 [X]       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.



1



INFORMATION CONTAINED IN THIS FORM 6-K REPORT


Attached as Exhibit 99.1 is a press release of DryShips Inc. dated March 6, 2013: DryShips Inc. Reports Financial and Operating Results for the Fourth Quarter 2012.




2




SIGNATURES

 

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.

 

 

  

DRYSHIPS INC.                         

  

(Registrant)

  

  

Dated:  March 7, 2013

By:  /s/George Economou    

  

  

George Economou

Chief Executive Officer





3



Exhibit 99.1

[f030713drys6k001.jpg]



DRYSHIPS INC. REPORTS FINANCIAL AND OPERATING

RESULTS FOR THE FOURTH QUARTER 2012

March 6, 2013, Athens, Greece. DryShips Inc. (NASDAQ: DRYS), or DryShips or the Company, an international provider of marine transportation services for drybulk and petroleum cargoes, and through its majority owned subsidiary, Ocean Rig UDW Inc., or Ocean Rig, of offshore deepwater drilling services, today announced its unaudited financial and operating results for the fourth quarter ended December 31, 2012.

Fourth Quarter 2012 Financial Highlights

Ø

For the fourth quarter of 2012, the Company reported a net loss of $129.8 million, or $0.34 basic and diluted loss per share.


Included in the fourth quarter 2012 results are:


-

Costs associated with the 10-year class survey for the Eirik Raude of $43.9 million, or $0.12 per share;

-

Loss on the sale of the newbuilding tankers Esperona and Blanca, of $41.3 million, or $0.11 per share.


Excluding the above items, the Company’s net results would have amounted to a net loss of $59.9 million, or $0.15 per share. (1)


Ø

The Company reported Adjusted EBITDA of $109.5 million for the fourth quarter of 2012, as compared to $169.0 million for the fourth quarter of 2011. (2)


Year Ended December 31, 2012 Financial Highlights

Ø

For the year ended 2012, the Company reported a net loss of $246.8 million, or $0.65 basic and diluted loss per share.


Included in the year ended 2012 results are:


-

Costs associated with the 10-year class survey for the Eirik Raude of $65.5 million, or $0.17 per share;

-

Loss on the sale of the newbuilding tankers Esperona and Blanca, of $41.3 million, or $0.11 per share.


Excluding the above items, the Company’s net results would have amounted to a net loss of $162.8 million, or $0.43 per share. (1)

Ø

The Company reported Adjusted EBITDA of $500.5 million for the year ended 2012, as compared to $600.9 million for the year ended 2011.(2)

__________________________________


(1)  The net result is adjusted for the minority interests of 35% of Ocean Rig not owned by Dryships Inc. common stockholders as of December 31, 2012.

(2) Adjusted EBITDA is a non-GAAP measure; please see later in this press release for reconciliation to net income.


Recent Events


-

On March 3, 2013, our customer European Hydrocarbons Limited, or European Hydrocarbons, unilaterally cancelled our drilling contract in West Africa for the Eirik Raude. Under the terms of the contract, European Hydrocarbons will have to reimburse the Company with an early termination payment of approximately $13 million plus accrued work performed to date.  


-

On February 28, 2013, Ocean Rig signed definitive documentation for a $1.35 billion syndicated secured term loan facility to partially finance the construction costs of the newbuilding drillships Ocean Rig Mylos, the Ocean Rig Skyros and the Ocean Rig Athena, scheduled for delivery in July 2013, October 2013 and November 2013, respectively. The facility has a five-year term and a repayment profile of approximately 11 years and bears interest at LIBOR plus a margin.


-

On February 14, 2013, Ocean Rig received a Letter of Award (LOA) from a major oil company for a three-year drilling contract offshore West Africa with an estimated backlog of approximately $680 million, including mobilization for the Ocean Rig Apollo, our newbuilding drillship scheduled for delivery in January 2015. The contract is scheduled to commence in the first quarter of 2015. The customer has the option to extend the contract for four periods of six months each, with the first option exercisable not less than one year before the estimated completion date. The Company has the option to elect the Ocean Rig Apollo or similar vessel, to drill under this contract. The contract is subject to definitive documentation and customary approvals.


-

On February 14, 2013, the Company completed a public offering of an aggregate of 7,500,000 common shares of Ocean Rig owned by DryShips. The Company received approximately $123.2 million of net proceeds from the public offering.

 

-

On February 1, 2013, Ocean Rig entered into a firm four-well program plus options, with Lukoil Overseas Sierra-Leone B.V., or Lukoil, for the Eirik Raude for drilling offshore West Africa. The contract has estimated duration of about 12 months and an estimated backlog of approximately $217 million, including mobilization and demobilization fees. This contract is scheduled to commence in the second half of 2013, following the completion of the drilling contract with ExxonMobil discussed below


-

On January 14, 2013, the Company sold, via novation, two of its tankers under construction at Samsung Heavy Industries Co. Ltd. Or Samsung, Esperona and Blanca, to a third party. Under the terms of the novation agreements the buyer assumed all rights, benefits and obligations under the shipbuilding contracts, in exchange for a cash consideration of $21.4 million paid by the Company to the buyer.


-

On January 9, 2013, Ocean Rig entered into a drilling contract with ExxonMobil Exploration and Production Ireland (Offshore) Limited, or ExxonMobil, for a one-well program for the Eirik Raude for drilling offshore Ireland. The contract has an estimated duration of up to six months and an estimated backlog of approximately $112 million, including mobilization and demobilization fees. The contract commenced on March 3, 2013, in direct continuation of the cancelled contract with European Hydrocarbons.


-

In December 2012, the Company reached an agreement with the lender under its $90.0 million Senior Secured Credit Facility dated October 5, 2007, as amended, and its $130.0 million Senior Secured Credit Facility dated March 13, 2008, as amended. Under the terms of these agreements, the lender has agreed to waive the Company’s breaches of the value maintenance covenants until December 31, 2013 as well as to defer certain installments to maturity. In exchange, the Company has agreed to increase the pricing under the facility as well as provide a full cash sweep up to a certain point in time. In addition, the Company has agreed to provide a pledge over a portion of the Ocean Rig shares owned by DryShips which pledge will be automatically released on December 31, 2013. We estimate that the number of shares subject to this pledge will be approximately 7,600,000. These agreements are subject to definitive documentation which is expected to be completed by the end of the first quarter of 2013.


-

In December 2012, we reached an agreement with a far eastern shipyard for a $12.5 million sellers credit to the Company. This credit is repayable to the yard in one bullet repayment two years after date of drawdown and it bears interest at LIBOR plus 300 basis points per annum. The Company has agreed to provide a pledge of 1,602,500 shares in Ocean Rig that it owns, which pledge will be automatically released upon repayment of credit. This agreement is subject to definitive documentation, which is expected to be completed by the end of the first quarter of 2013.

George Economou, Chairman and Chief Executive Officer of the Company, commented:


"We continue to be bearish about the short-term performance of the shipping markets. Both tanker and drybulk spot charter rates continue to hover around historic lows. Unfortunately this comes at a time when most of our lucrative legacy charters expire.


“As we have mentioned in previous quarters, low-cost financing for traditional shipping assets is generally less available than before and therefore the optimization of our newbuilding programs is our top priority right now. We sold our only two unfinanced tankers and eliminated approximately $100 million in CAPEX. With respect to our Drybulk newbuilding program in China, we are still in discussions with the shipyards in this respect to reduce and prolong our CAPEX program. This process was never going to be easy but we still believe a deal with a shipyard could be struck. Alternatively, we are seeing interest for our vessels in the S&P market.

 

“Our shareholding in Ocean Rig has been our backstop. We recently sold down a portion of our holdings for approximately $120 million. This action was not a preferred option (especially at today’s pricing levels) but it was necessary. In addition, we have pledged some of our Ocean Rig shares to our banks to remedy covenant breaches. We continue to be bullish about the prospects for Ocean Rig. The backlog currently stands at $5.1 billion over three years and provides Ocean Rig with substantial cash flow visibility and growth. Given strong industry fundamentals, we expect to further increase our already substantial backlog by entering into long-term contracts for remaining units.”


























Financial Review: 2012 Fourth Quarter

The Company recorded a net loss of $129.8 million, or $0.34 basic and diluted loss per share, for the three-month period ended December 31, 2012, as compared to a net loss of $6.2 million, or $0.02 basic and diluted earnings per share, for the three-month period ended December 31, 2011. Adjusted EBITDA was $109.5 million for the fourth quarter of 2012, as compared to $169.0 million for the same period in 2011.(3)

For the drybulk carrier segment, net voyage revenues (voyage revenues minus voyage expenses) amounted to $34.9 million for the three-month period ended December 31, 2012, as compared to $81.6 million for the three-month period ended December 31, 2011. For the offshore drilling segment, revenues from drilling contracts decreased by $7.9 million to $229.8 million for the three-month period ended December 31, 2012, as compared to $237.7 million for the same period in 2011. For the tanker segment, net voyage revenues amounted to $6.5 million for the three-month period ended December 31, 2012, as compared to $3.6 million for the same period in 2011.

Total vessels’, drilling rigs’ and drillships’ operating expenses and total depreciation and amortization increased to $194.4 million and $84.8 million, respectively, for the three-month period ended December 31, 2012, from $119.6 million and $82.3 million, respectively, for the three-month period ended December 31, 2011. Total general and administrative expenses increased to $39.5 million in the fourth quarter of 2012 from $36.7 million during the comparative period in 2011.

Interest and finance costs, net of interest income, amounted to $53.5 million for the three-month period ended December 31, 2012, compared to $48.2 million for the three-month period ended December 31, 2011.















________________________

(3) Adjusted EBITDA is a non-GAAP measure; please see later in this press release for a reconciliation to net income.


Fleet List

The table below describes our fleet profile as of March 4, 2013:

 

Year

 

 

Gross rate

Redelivery

 

 

Built

DWT

Type

Per day

Earliest

Latest

Drybulk fleet

 

 

 

 

 

 

 

 

 

 

 

 

 

Capesize:

 

 

 

 

 

 

Fakarava

2012

206,000

Capesize

$25,000

Sept-15

Sept-20

Mystic

2008

170,040

Capesize

$52,310

Aug-18

Dec-18

Robusto

2006

173,949

Capesize

$26,000

Aug-14

Apr-18

Cohiba

2006

174,234

Capesize

$26,250

Oct-14

Jun-19

Montecristo

2005

180,263

Capesize

$23,500

May-14

Feb-19

Flecha

2004

170,012

Capesize

$55,000

Jul-18

Nov-18

Manasota

2004

171,061

Capesize

$30,000

Jan-18

Aug-18

Partagas

2004

173,880

Capesize

$10,000

Jun-13

Aug-13

Alameda

2001

170,662

Capesize

$27,500

Nov-15

Jan-16

Capri  

2001

172,579

Capesize

$10,000

Nov-13

Mar-14

 

 

 

 

 

 

 

Panamax:

 

 

 

 

 

 

Raraka

2012

76,037

Panamax

$7,500

Jan-15

Mar-15

Woolloomooloo

2012

76,064

Panamax

$7,500

Dec-14

Feb-15

Amalfi

2009

75,206

Panamax

$39,750

Jul- 13

Sep- 13

Rapallo

2009

75,123

Panamax

Spot

N/A

N/A

Catalina

2005

74,432

Panamax

$40,000

Jun-13

Aug-13

Majorca

2005

74,477

Panamax

Spot

N/A

N/A

Ligari

2004

75,583

Panamax

Spot

N/A

N/A

Saldanha

2004

75,707

Panamax

Spot

N/A

N/A

Sorrento

2004

76,633

Panamax

$24,500

Aug-21

Dec-21

Mendocino

2002

76,623

Panamax

Spot

N/A

N/A

Bargara

2002

74,832

Panamax

Spot

N/A

N/A

Oregon

2002

74,204

Panamax

$9,650

Sept-13

Nov-13

Ecola

2001

73,931

Panamax

Spot

N/A

N/A

Samatan

2001

74,823

Panamax

Spot

N/A

N/A

Sonoma

2001

74,786

Panamax

Spot

N/A

N/A

Capitola  

2001

74,816

Panamax

Spot

N/A

N/A

Levanto

2001

73,925

Panamax

Spot

N/A

N/A

Maganari

2001

75,941

Panamax

Spot

N/A

N/A

Coronado

2000

75,706

Panamax

Spot

N/A

N/A

Marbella

2000

72,561

Panamax

Spot

N/A

N/A

Redondo

2000

74,716

Panamax

$9,250

Sept-13

Nov-13

Topeka

2000

74,716

Panamax

Spot

N/A

N/A

Ocean Crystal

1999

73,688

Panamax

Spot

N/A

N/A

Helena

1999

73,744

Panamax

Spot

   N/A

N/A

 

 

 

 

 

 

 

Supramax:

 

 

 

 

 

 

Byron

2003

51,118

Supramax

Spot

N/A

N/A

Galveston

2002

51,201

Supramax

Spot

N/A

N/A
















Year

 

 









Gross rate









Redelivery

 

 

Built

DWT

Type

Per day

Earliest

Latest

Newbuildings

 

 

 

 

 

 

Capesize:

 

 

 

 

 

 

Newbuilding VLOC #5

2014

206,000

Capesize

Spot

N/A

N/A

Newbuilding VLOC #2

2013

206,000

Capesize

Spot

N/A

N/A

Newbuilding VLOC #3

2013

206,000

Capesize

Spot

N/A

N/A

Newbuilding VLOC #4

2013

206,000

Capesize

Spot

N/A

N/A

Newbuilding Capesize 1

2013

176,000

Capesize

Spot

N/A

N/A

Newbuilding Capesize 2

2013

176,000

Capesize

Spot

N/A

N/A

Panamax:

 

 

 

 

 

 

Newbuilding Ice –class Panamax 1

2014

75,900

Panamax

Spot

N/A

N/A

Newbuilding Ice –class Panamax 2

2014

75,900

Panamax

Spot

N/A

N/A

Newbuilding Ice –class Panamax 3

2014

75,900

Panamax

Spot

N/A

N/A

Newbuilding Ice –class Panamax 4

2014

75,900

Panamax

Spot

N/A

N/A

Tanker fleet

 

 

 

 

 

 

Suezmax:

 

 

 

 

 

 

Bordeira

2013

158,300

Suezmax

Spot

N/A

N/A

Petalidi

2012

158,300

Suezmax

Spot

N/A

N/A

Lipari

2012

158,300

Suezmax

Spot

N/A

N/A

Vilamoura

2011

158,300

Suezmax

Spot

N/A

N/A

Aframax:

 

 

 

 

 

 

Alicante

2013

115,200

Aframax

Spot

N/A

N/A

Mareta

2013

115,200

Aframax

Spot

N/A

N/A

Calida

2012

115,200

Aframax

Spot

N/A

N/A

Saga

2011

115,200

Aframax

Spot

N/A

N/A

Daytona

2011

115,200

Aframax

Spot

N/A

N/A

Belmar

2011

115,200

Aframax

Spot

N/A

N/A

 

 

 

 

 

 

 

Drilling Rigs/Drillships:

Unit

Year built

Redelivery

Operating area

Backlog ($m)

Leiv Eiriksson

2001

Q1 - 16

Norway

$627

Eirik Raude

2002

Q3 - 13

Ireland

$112

Eirik Raude

2002

Q4 - 14

Sierra Leone, Ghana, Ivory Coast

$217

Ocean Rig Corcovado

2011

Q2 - 15

Brazil

$357

Ocean Rig Olympia

2011

Q3 - 15

Ivory Coast, Gabon, Angola

$517

Ocean Rig Poseidon

2011

Q1 - 13

Africa

$22

Ocean Rig Poseidon

2011

Q2 - 16

Angola

$781

Ocean Rig Mykonos

2011

Q1 - 15

Brazil

$330

Newbuildings

 

 

 

 

Ocean Rig Mylos

2013

Q3 - 16

Brazil

$680

Ocean Rig Skyros

2013

N/A

N/A

N/A

Ocean Rig Athena

2013

Q1 - 17

Angola

$750

Ocean Rig Apollo

2015

Q1 - 18

West Africa

   $680 (1)

Total

 

 

 

$5,073






(1)

LOA is subject to definitive documentation.




Drybulk Carrier and Tanker Segment Summary Operating Data (unaudited)


 (Dollars in thousands, except average daily results)

 

Drybulk

Three Months Ended

 December 31,

 

Year Ended

December 31,

 

 

2011

 

2012

 

2011

 

2012

 

Average number of vessels(1)

36.1

 

36

 

35.8

 

35.7

 

Total voyage days for vessels(2)

3,226

 

3,312

 

12,831

 

13,027

 

Total calendar days for vessels(3)

3,325

 

3,312

 

13,068

 

13,056

 

Fleet utilization(4)

97.0%

 

100.0%

 

98.2%

 

99.8%

 

Time charter equivalent(5)

$25,306

 

$10,547

 

$26,912

 

$15,896

 

Vessel operating expenses (daily)(6)

$7,007

 

$5,124

 

$6,271

 

$5,334

 

 

 

 

 

 

 

 

 



Tanker

Three Months Ended

December 31,

 

Year Ended

December 31,

 

2011

 

2012

 

2011

 

2012

Average number of vessels(1)

3.9

 

7.0

 

2.6

 

6.3

Total voyage days for vessels(2)

362

 

644

 

963

 

2,293

Total calendar days for vessels(3)

362

 

644

 

963

 

2,293

Fleet utilization(4)

100.0%

 

100.0%

 

100.0%

 

100.0%

Time charter equivalent(5)

$10,077

 

$10,062

 

$12,592

 

$13,584

Vessel operating expenses (daily)(6)

$8,895

 

$6,781

 

$9,701

 

$7,195


(1) Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period.

(2) Total voyage days for fleet are the total days the vessels were in our possession for the relevant period net of dry-docking days.

(3) Calendar days are the total number of days the vessels were in our possession for the relevant period including dry-docking days.

(4) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period.

(5) Time charter equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE is consistent with industry standards and is determined by dividing voyage revenues (net of voyage expenses) by voyage days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract, as well as commissions. TCE revenues, a non-U.S. GAAP measure, provides additional meaningful information in conjunction with revenues from our vessels, the most directly comparable U.S. GAAP measure, because it assists our management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance. TCE is also a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance despite changes in the mix of charter types (i.e., spot charters, time charters and bareboat charters) under which the vessels may be employed between the periods. Please see below for a reconciliation of TCE rates to voyage revenues.

(6) Daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs is calculated by dividing vessel operating expenses by fleet calendar days for the relevant time period.


(In thousands of U.S. dollars, except for TCE rate, which is expressed in Dollars, and voyage days)


Drybulk


Three Months Ended

December 31,

 


Year Ended

December 31,

 

2011

 

2012

 

2011

 

2012

Voyage revenues

$86,621

$

40,754

$

365,361

$

227,141

Voyage expenses

(4,985)

 

(5,821)

 

(20,047)

 

(20,064)

Time charter equivalent revenues

$81,636

$

34,933

$

345,314

$

207,077

Total voyage days for fleet   

3,226

 

3,312

 

12,831

 

13,027

Time charter equivalent (TCE) rate

$25,306

$

10,547

$

26,912

$

15,896


Tanker

Three Months Ended

 December 31,

 

Year Ended

December 31,

 

2011

 

2012

 

2011

 

2012

Voyage revenues

$3,903

$

12,361

$

$12,652

$

41,095

Voyage expenses

(255)

 

(5,881)

 

(526)

 

(9,948)

Time charter equivalent revenues

$3,648

$

6,480

$

$12,126

$

31,147

Total voyage days for fleet   

362

 

644

 

963

 

2,293

Time charter equivalent (TCE) rate

$10,077

$

10,062

$

12,592

$

13,584








Dryships Inc.


Financial Statements

Unaudited Condensed Consolidated Statements of Operations


(Expressed in Thousands of U.S. Dollars

except for share and per share data)

 


Three Months Ended

December 31,

 


Year Ended

December 31,

 

 

 

2011

 

2012

 

2011

 

2012

 

 

 

 

 

 

 

 

 

 

 

REVENUES:

 

 

 

 

 

 

 

 

 

Voyage revenues

$

90,524

$

53,115

$

378,013

$

268,236

 

Revenues from drilling contracts

 

237,658

 

229,751

 

699,649

 

941,903

 

 

 

328,182

 

282,866

 

1,077,662

 

1,210,139

 

 

 

 

 

 

 

 

 

 

 

EXPENSES:

 

 

 

 

 

 

 

 

 

Voyage expenses

 

5,240

 

11,702

 

20,573

 

30,012

 

Vessel operating expenses

 

26,517

 

21,337

 

91,289

 

86,139

 

Drilling rigs operating expenses

 

93,056

 

173,092

 

281,833

 

563,583

 

Depreciation and amortization

 

82,280

 

84,843

 

274,281

 

335,458

 

Vessel impairments and other, net

 

27,142

 

41,517

 

116,779

 

42,518

 

General and administrative expenses

 

36,660

 

39,460

 

123,247

 

145,935

 

Legal settlements and other

 

-

 

(5,912)

 

-

 

(9,360)

 

 

 

 

 

 

 

 

 

 

 

Operating income/(loss)

 

57,287

 

(83,173)

 

169,660

 

15,854

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME / (EXPENSES):

 

 

 

 

 

 

 

 

 

Interest and finance costs, net of interest income

 

(48,181)

 

(53,456)

 

(129,598)

 

(205,925)

 

Gain/(loss) on interest rate swaps

 

2,298

 

(4,582)

 

(68,943)

 

(54,073)

 

Other, net

 

1,441

 

(1,891)

 

9,023

 

(492)

 

Income taxes

 

(9,872)

 

(11,354)

 

(27,428)

 

(43,957)

 

Total other expenses

 

(54,314)

 

(71,283)

 

(216,946)

 

(304,447)

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

2,973

 

(154,456)

 

(47,286)

 

(288,593)

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss) attributable to Non controlling interests

 

(9,193)

 

24,608

 

(22,842)

 

41,815

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable

to Dryships Inc.


$

(6,220)


$

(129,848)


$

(70,128)


$

(246,778)

 

 

 

 

 

 

 

 

 

 

 

Loss per common share, basic and diluted

$

(0.02)

$

(0.34)

$

(0.21)

$

(0.65)

 

Weighted average number of shares, basic and diluted

 

375,495,260

 

380,179,472

 


355,144,764

 

380,159,088

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 























Dryships Inc.


Unaudited Condensed Consolidated Balance Sheets


(Expressed in Thousands of U.S. Dollars)

 

December 31, 2011

   




December 31, 2012

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Cash and restricted cash (current and non-current)

$

656,709

$

720,458

 

Other current assets  

 

246,169

 

338,446

 

Advances for vessels and rigs under construction and acquisitions

 

1,027,889

 

1,201,807

 

Vessels, net

 

1,956,270

 

2,059,570

 

Drilling rigs, drillships, machinery and equipment, net

 

4,587,916

 

4,446,730

 Other non-current assets

 

146,736

 

111,480

 

Total assets

 

8,621,689

 

8,878,491

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total debt

 

4,241,835

 

4,386,715

 

Total other liabilities

 

441,192

 

623,757

 

Total stockholders’ equity

 

3,938,662

 

3,868,019

 

Total liabilities and stockholders’ equity

$

8,621,689

$

8,878,491

 

 

 

 

 

 

 

















Adjusted EBITDA Reconciliation

Adjusted EBITDA represents net income before interest, taxes, depreciation and amortization, vessel impairments, dry-dockings and class survey costs and gains or losses on interest rate swaps. Adjusted EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is included herein because it is a basis upon which the Company measures its operations and efficiency. Adjusted EBITDA is also used by our lenders as a measure of our compliance with certain covenants contained in our loan agreements and because the Company believes that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness.

The following table reconciles net income to Adjusted EBITDA:

(Dollars in thousands)

 

 Three Months Ended December 31, 2011

 

 Three Months Ended December 31, 2012

 

Year Ended December 31, 2011

 

Year Ended December 31, 2012

 

 

 

 

 

 

 

 

 

Net loss

 

$      (6,220)             

 

(129,848)

 

(70,128)

 

$   (246,778)         

 

 

 

 

 

 

 

 

 

Add: Net interest expense

 

48,181

 

53,456

 

129,598

 

205,925

Add: Depreciation and amortization

 

82,280

 

84,843

 

274,281

 

335,458

Add: Impairment losses and other

 

32,584

 

41,339

 

144,688

 

41,339

Add: Dry-dockings and class survey costs

 

4,643

 

43,745

 

26,135

 

66,506

Add: Income taxes

 

9,872

 

11,354

 

27,428

 

43,957

Add: Gain/(loss) on interest rate swaps

 

(2,298)

 

4,582

 

68,943

 

54,073

Adjusted EBITDA

 

$     169,042

 

109,471

 

600,945

 

$     500,480         




4



Conference Call and Webcast: March 7, 2013

As announced, the Company’s management team will host a conference call, on Thursday, March 7, 2013 at 9:00 a.m. Eastern Standard Time to discuss the Company's financial results.

Conference Call Details

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329 (from the UK) or +(44) (0) 1452 542 301 (from outside the US). Please quote "DryShips."

A replay of the conference call will be available until March 14, 2013. The United States replay number is 1(866) 247- 4222; from the UK 0(800) 953-1533; the standard international replay number is (+44) (0) 1452 55 00 00 and the access code required for the replay is: 2133051#.

A replay of the conference call will also be available on the Company’s website at www.dryships.com under the Investor Relations section.

Slides and Audio Webcast

There will also be a simultaneous live webcast over the Internet, through the DryShips Inc. website (www.dryships.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About DryShips Inc.


DryShips Inc. is an owner of drybulk carriers and tankers that operate worldwide. Through its majority owned subsidiary, Ocean Rig UDW Inc., DryShips owns and operates 10 offshore ultra deepwater drilling units, comprising of 2 ultra deepwater semisubmersible drilling rigs and 8 ultra deepwater drillships, 3 of which remain to be delivered to Ocean Rig during 2013 and 1 is scheduled for delivery during 2015.  DryShips owns a fleet of 46 drybulk carriers (including newbuildings), comprising 12 Capesize, 28 Panamax, 2 Supramax and 4 newbuilding Very Large Ore Carriers (VLOC) with a combined deadweight tonnage of approximately 5.1 million tons, and 10 tankers, comprising 4 Suezmax and 6 Aframax, with a combined deadweight tonnage of over 1.3 million tons.


DryShips’ common stock is listed on the NASDAQ Global Select Market where it trades under the symbol “DRYS.”

Visit the Company’s website at www.dryships.com



5



Forward-Looking Statement

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.


Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charterhire and drilling dayrates and drybulk vessel, drilling rig and drillship values, failure of a seller to deliver one or more drilling rigs, drillships or drybulk vessels, failure of a buyer to accept delivery of a drilling rig, drillship, or vessel, inability to procure acquisition financing, default by one or more charterers of our ships, changes in demand for drybulk commodities or oil, changes in demand that may affect attitudes of time charterers and customer drilling programs, scheduled and unscheduled drydockings and upgrades, changes in our operating expenses, including bunker prices, drydocking and insurance costs, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by DryShips Inc. with the U.S. Securities and Exchange Commission.

Investor Relations / Media:

Nicolas Bornozis

Capital Link, Inc. (New York)

Tel. 212-661-7566

E-mail: dryships@capitallink.com





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