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DHT Maritime, Inc. Reports Second Quarter 2009 Results.

Article Excerpt
ST. HELIER, Channel Islands -- DHT Maritime, Inc. (NYSE:DHT) today announced results for the period from April 1 to June 30, 2009. Total revenues for this period were $26.2 million and net income was $5.0 million, or $0.10 per share (diluted). Effective January 1, 2009, DHT no longer accounts for interest rate swaps as hedges for accounting purposes and as a result, net income for the second quarter of 2009 includes non-cash financial income related to interest rate swaps. Net income adjusted for non-cash financial items related to interest rate swaps was $3.2 million, or $0.07 per share1. Free cash flow from operations after contractual debt service, or net income adjusted for non-cash items, was $9.8 million, or $0.20 per share2. Also, in connection with the early termination of interest rate swaps in an amount of $42 million, DHT incurred a cash expense of $2.4 million, or $0.05 per share, in the second quarter.

DHT's policy of employing its vessels on medium- to long-term charters that provide stable earnings and cash flow is serving the Company well in the current freight market, which has experienced significant weakness in the second quarter. Nonetheless, the current charter rates obtainable in the spot market have had, and are expected to continue to have, a negative impact on the Company's revenues by decreasing the profit sharing element under its charter agreements.

The average remaining term under the current charters is in excess of 4 years, and all of the Company's vessels are chartered to wholly-owned subsidiaries of Overseas Shipholding Group Inc. ("OSG"), which has one of the highest credit ratings (BB/Ba2) among shipping companies.

After assessing the uncertain shipping market, the Company voluntarily prepaid $50 million under its credit facility during the second quarter in order to reduce the Company's total leverage and to increase the Company's flexibility under its existing financing arrangements. The prepayment improves DHT's future liquidity as it reduces the principal debt repayment obligations in the period from January 2011 to July 2013 to $16 million per year, decreased from an original $36 million per year in the same period.

1) Net income adjusted for non-cash financial items related to interest rate swaps represents the sum of net income, amortization of unrealized loss of interest rate swaps and fair value (gain)/loss on derivative financial instrument. Please refer to the table on page 10 for a reconciliation between net income and net income adjusted for non-cash financial items related to interest rate swaps.

2) Free cash flow from operations after contractual debt service represents the sum of net income, amortization of unrealized loss of interest rate swaps, fair value (gain)/loss on derivative financial instrument and depreciation and amortization. Please refer to the table on page 10 for a reconciliation between net income and free cash flow...

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