FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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 2006
NORDIC AMERICAN TANKER SHIPPING LIMITED
(Translation of registrant's name into English)
LOM Building
27 Reid Street
Hamilton, HM 11
Bermuda
(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): ___
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: ___
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [_] No [ X ]
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): ________.
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached hereto as Exhibit 1 is a press release issued by Nordic
American Tanker Shipping Limited (the "Company") on November 3, 2006 announcing
the Company's dividend and earnings in respect of the third quarter 2006.
Exhibit 1
[GRAPHIC OMITTED]
Nordic American Tanker Shipping Ltd. (NAT)-(NYSE:NAT) - Announces Dividend and
Earnings in respect of the 3rd Quarter of 2006
Hamilton, Bermuda, November 3, 2006
Nordic American Tanker Shipping Limited (the "Company") today announced its
results for the 3rd quarter of 2006. A strong tanker market resulted in solid
earnings and a healthy dividend per share for the 3rd quarter. The Company has
now declared a dividend for 36 consecutive quarters. For the last four quarters
including the dividend to be paid in respect of the 3rd quarter of 2006 a total
of $5.85 has been declared in dividends which represent 17.7% of the average
daily share price over the same period.
Highlights:
o The Board of Directors has declared a dividend of $1.32 per share for the
3rd quarter of 2006.
o 3rd quarter 2006 net income was $0.97 per share based on 21,046,400 issued
and outstanding shares at the end of the 3rd quarter.
o No vessels were in dry dock during the 3rd quarter of 2006. We had a total
of 11 days offhire across the fleet during the 3rd quarter.
o The dividend is expected to be paid on or about November 28th 2006 to
shareholders of record as of November 15th 2006.
o In July the Company announced the acquisitions of its tenth, eleventh and
twelfth Suezmax vessels for an aggregate purchase price of $245.9m. The
vessels are expected to be delivered from the seller no later than November
2006.
o The Company commenced a follow-on offering on September 26, 2006. The
offering was closed on October 11, providing net proceeds to the Company of
$173.9m based on an offering price of $32.00 per share. As of November 3,
2006, there are 26,914,088 shares issued and outstanding.
o In September the Company increased its Revolving Credit Facility to $500
million from the previous $300 million, on the same terms as the previous
Credit Facility.
Dividends per Share, Earnings per Share and Financial Information:
The Board has declared a dividend of $1.32 per share in respect of the 3rd
quarter of 2006. This compares to a dividend of $0.60 per share in respect of
the 3rd quarter of 2005.
Net income for the 3rd quarter of 2006 was $20.3m or $0.97 per share (EPS). This
compares to a net income of $4.3m or $0.26 per share for the 3rd quarter of
2005.
Operating cash flow (1) was $29.7m for the 3rd quarter of 2006 compared to
$10.4m for the 3rd quarter of 2005.
For the 3rd quarter of 2006, operating costs of our vessels and general and
administrative costs were largely according to our expectations.
The Company is not involved in freight or interest derivatives.
We currently estimate that our average cash breakeven for our fleet of twelve
vessels is approximately $9,000 per day per vessel. The breakeven rate is the
amount of average daily revenues for our vessels which would cover our vessel
operating expenses, voyage expenses, if any, cash general and administrative
expenses, interest expenses and other financial charges.
Following the public offering in October and after the delivery of the three
vessels in November our net debt will be approximately $14m per vessel and we
will have approximately $328m undrawn under our $500m revolving credit facility
with maturity in 2010. There is no repayment obligation during the tenure of the
facility, and the Company pays interest only on drawn amounts, and a commitment
fee for undrawn amounts.
No vessels were in dry dock during the 3rd quarter of 2006. After a minor
incident, one of our ships has been in dry dock approximately 19 days during the
4th quarter of 2006. There are no other vessels scheduled for dry docking during
the 4th quarter of 2006.
The table below shows the number of vessel revenue days over the last eight
quarters for all our vessels, reflecting the growth of the Company.
--------------------------------------------------------------------------------
Period 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06
--------------------------------------------------------------------------------
Revenue days 314 371 549 576 697 720 808 817
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For further details on our financial results, please see later in this message.
The Fleet
---------
Eight of the Company's nine vessels are trading in the spot market or on spot
related terms, while one vessel remains employed on a long term fixed charter
rate.
Vessel Dwt Employment
------ --- ----------
Gulf Scandic 151,458 Long term fixed charter
Nordic Hawk 151,458 Spot related terms
Nordic Hunter 151,458 Spot related terms
Nordic Voyager 149,591 Spot
Nordic Fighter 153,181 Spot
Nordic Freedom 159,500 Spot
Nordic Discovery 153,181 Spot
Nordic Saturn 157,332 Spot
Nordic Jupiter 157,332 Spot
Nordic Cosmos 149,997 Spot, expected from Nov. 2006
Nordic Moon 149,997 Spot, expected from Nov. 2006
Nordic Apollo 149,997 Spot, expected from Nov. 2006
Total 1,683,024
The Market
While market spot rates, according to the Imarex Tanker Index, were in the range
of $40,000-$50,000 per day in July 2006, the market then strengthened further,
with average earnings for modern suezmax tankers ranging in the high $50,000 per
day towards the end of August 2006. In September, the market eased off towards
the middle of the month. The average earnings for modern suezmax tankers for the
3rd quarter of 2006 were $46,174 per day according to the Imarex Tanker Index.
In October 2006 the average Imarex spot market rate was $46,940 per day.
Short-term spot rates are notoriously difficult to predict.
The world's suezmax fleet stood at 343 vessels at the end of the 3rd quarter of
2006, compared to 318 vessels at the end of the 3rd quarter of 2005. Eight new
vessels were delivered during the 3rd quarter while no vessels were scrapped.
Thirty-seven new vessels have been ordered during the 3rd quarter of 2006. The
total suezmax order book stood at 99 vessels at the end of the September. At the
same time, 72 vessels were single hull, which are expected to be phased out by
2010. Two new vessels are expected to be delivered during the 4th quarter of
2006 (Source: Fearnresearch).
Deliveries of tankers over the next 24 - 36 months from the shipyards can be
estimated with a high degree of certainty. The shipyards are expected to operate
at more or less full capacity with their present order books, and new orders
placed for suezmax tankers are typically for delivery in late 2009 or in 2010.
We expect that short term tanker rates may continue to fluctuate significantly.
Strategy
--------
The Company is basing its operations on its unique and successful operating
model which combines a transparent and predictable full dividend payout policy
with high spot market exposure and a strong balance sheet. Focus is also on a
cost effective management of the Company, in order to maintain a low cash
break-even level for the operations.
The Company's exposure to the spot market is based on our analysis showing that
the spot market over time can be expected to produce higher revenues on average
than the time charter market. With a strong balance sheet, a full dividend
payout policy can be maintained without accumulating cash reserves on the
balance sheet. A certain amount of term charter coverage is being contemplated
from time to time.
The main objective of the Company is to maximize the total return(2) for
shareholders via a transparent, predictable and simple strategic platform.
Growth is also an inherent part of the operating model and further expansion can
be expected. The expansion of the Company is bolstering its earnings and
dividend capacity per share.
----------
(1) Operating cash flow is a non-GAAP financial term often used by investors to
measure financial performance of shipping companies. Operating cash flow
represents income from vessel operations before depreciation and non-cash
administrative charges. Please see page 5 for a reconciliation of this
non-GAAP measure as used in this release to the most directly comparable
GAAP financial measure.
(2) The total return is based on the change in the price for our common shares
plus dividends reinvested in our common shares.
NORDIC AMERICAN TANKER SHIPPING LIMITED
Amounts in USD '000
----------------------------------------------------------------------------------------------------------------------
CONDENSED STATEMENTS
OF OPERATION
Three Months Ended Nine Months Ended
------------------------------------------- -------------------------------
Sep. 30, Jun. 30, Sep. 30, Sep. 30, Sep. 30,
2006 2006 2005 2006 2005
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
----------------------------------------------------------------------------------------------------------------------
NET VOYAGE REVENUE 36,547 29,574 14,405 101,079 48,558
----------------------------------------------------------------------------------------------------------------------
OPERATING EXPENSES
Vessel operating expenses (5,706) (4,842) (3,144) (14,998) (7,711)
Depreciation (7,257) (7,256) (4,842) (20,798) (11,733)
General and administrative costs (1,549)* (2,175)* (1,170) (7,562)** (6,874)**
----------------------------------------------------------------------------------------------------------------------
(14,512) (14,273) (9,156) (43,358) (26,318)
----------------------------------------------------------------------------------------------------------------------
Income from vessel operation 22,035 15,301 5,249 57,721 22,240
----------------------------------------------------------------------------------------------------------------------
OTHER ITEMS
Interest income 118 243 170 640 731
Interest expense (1,831) (1,302) (1,101) (4,713) (1,756)
----------------------------------------------------------------------------------------------------------------------
(1,713) (1,059) (931) (4,073) (1,025)
----------------------------------------------------------------------------------------------------------------------
NET INCOME 20,322 14,242 4,318 53,648 21,215
----------------------------------------------------------------------------------------------------------------------
Earnings per average number of shares 0.97 0.68 0.26 2.71 1.40
----------------------------------------------------------------------------------------------------------------------
Weighted average number of shares 21,046,400 21,035,622 16,644,496 19,825,910 15,198,001
----------------------------------------------------------------------------------------------------------------------
Common shares outstanding 21,046,400 21,046,400 16,644,496 21,046,400 16,644,496
----------------------------------------------------------------------------------------------------------------------
*) The G&A for the three months ended Jun. 30, 2006 and Sep. 30, 2006 include
non-cash charges of $0.9m and $0.4m respectively which are charges related
share based compensation and the 2004 Stock Option Plan.
**) Including non-cash charges associated with issuance of restricted shares to
the Manager in connection with follow-on offerings and non-cash charges
associated with the 2004 Stock Option Plan.
CONDENSED BALANCE SHEETS
-------------------------------------------------------------------------------------
Sep. 30, Sep. 30, Dec. 31,
2006 2005 2005
(unaudited) (unaudited)
-------------------------------------------------------------------------------------
Cash deposits 17,409 9,918 14,240
Other assets 53,330 8,130 27,671
Vessels 513,923 405,406 463,933
-------------------------------------------------------------------------------------
Total Assets 584,662 423,454 505,844
-------------------------------------------------------------------------------------
Accounts payable and accrued liabilities 13,182 1,138 4,972
Long-term debt 115,000 67,000 130,000
Shareholders' equity 456,480 355,316 370,872
-------------------------------------------------------------------------------------
Total liablilities and shareholders' equity 584,662 423,454 505,844
-------------------------------------------------------------------------------------
CONDENSED STATEMENTS OF CASH FLOW
Twelve
Nine months ended Months Ended
----------- ----------- --------------
Sep. 30, 2006 Sep. 30, 2005 Dec. 31, 2005
(unaudited) (unaudited)
---------------------------------------------------------------------------------------------------
OPERATING ACTIVITIES
---------------------------------------------------------------------------------------------------
Net cash from Operating Activitites 85,838 35,397 51,056
---------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
Net proceeds from sale of Common Stock 114,801 161,968 161,967
Proceeds from use of Credit Facility 101,000 72,000 135,000
Repayment of debt (116,000) (5,000) (5,000)
Loan facility costs 0 (1,050) (1,075)
Dividends paid (87,065) (54,292) (64,279)
---------------------------------------------------------------------------------------------------
Net Cash provided by (used for) Financing Activities 12,736 173,626 226,613
---------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Investment in Vessels (95,406) (229,837) (294,161)
---------------------------------------------------------------------------------------------------
Net cash used by investing activitites (95,406) (229,837) (294,161)
---------------------------------------------------------------------------------------------------
Net Increase in Cash and Cash Equivalents 3,169 (20,814) (16,492)
Beginning Cash and Cash Equivalents 14,240 30,732 30,732
---------------------------------------------------------------------------------------------------
Ending Cash and Cash Equivalents 17,409 9,918 14,240
---------------------------------------------------------------------------------------------------
NORDIC AMERICAN TANKER SHIPPING LIMITED
Reconciliation of non-GAAP financial measures
(Amounts in USD '000)
------------------------------------------------------------------------------------------
Three Months Ended Nine Months Ended
------------------------------------ ----------------------
Sep. 30, Jun. 30, Sep. 30, Sep. 30, Sep. 30,
2006 2006 2005 2006 2005
------------------------------------------------------------------------------------------
Voyage revenue 44,599 40,600 22,962 130,378 69,487
Voyage expenses (8,052) (11,026) (8,557) (29,299) (20,929)
------------------------------------------------------------------------------------------
Net voyage revenue(1) 36,547 29,574 14,405 101,079 48,558
------------------------------------------------------------------------------------------
============================================================================
Three Months Ended
==============================
Sep. 30, Jun. 30, Sep. 30,
2006 2006 2005
============================================================================
Income from vessel operations 22,035 15,301 5,249
Depreciation 7,257 7,256 4,842
Share Based Compensation/ Stock Option Plan 393 949 380
----------------------------------------------------------------------------
Operating Cash Flow(2) 29,685 23,506 10,471
============================================================================
(1) Net voyage revenues represents voyage revenues less voyage expenses such as
bunker fuel, port fees, canal tolls and brokerage commissions. Net voyage
revenues is included because certain investors use this data to measure a
shipping company's financial performance. Net voyage revenues is not
required by accounting principles generally accepted in the United States
and should not be considered as an alternative to net income or any other
indicator of the Company's performance required by accounting principles
generally accepted in the United States.
(2) Operating cash flow represents income from vessel operations before
depreciation and non-cash administrative charges. Operating cash flow is
included because certain investors use this data to measure a shipping
company's financial performance. Operating cash flow is not required by
accounting principles generally accepted in the United States and should
not be considered as an alternative to net income or any other indicator of
the Company's performance required by accounting principles generally
accepted in the United States.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Matters discussed in this press release may constitute forward-looking
statements. The Private Securities Litigation Reform Act of 1995 provides safe
harbor protections for forward-looking statements in order to encourage
companies to provide prospective information about their business.
Forward-looking statements 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 Company desires to take advantage of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995 and is including this
cautionary statement in connection with this safe harbor legislation. The words
"believe," "anticipate," "intend," "estimate," "forecast," "project," "plan,"
"potential," "will," "may," "should," "expect," "pending" and similar
expressions identify forward-looking statements.
The forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, our 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 we will achieve or accomplish
these expectations, beliefs or projections. We undertake no obligation to update
any forward-looking statement, whether as a result of new information, future
events or otherwise.
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
fluctuations in charter rates and vessel values, changes in demand in the tanker
market, as a result of changes in OPEC's petroleum production levels and world
wide oil consumption and storage, changes in our operating expenses, including
bunker prices, drydocking and insurance costs, the market for our vessels,
availability of financing and refinancing, changes in governmental rules and
regulations or actions taken by regulatory authorities, potential liability from
pending or future litigation, general domestic and international political
conditions, potential disruption of shipping routes due to accidents or
political events, vessels breakdowns and instances of off-hires and other
important factors described from time to time in the reports filed by the
Company with the Securities and Exchange Commission, including the prospectus
and related prospectus supplement, our Annual Report on Form 20-F, and our
reports on Form 6-K.
Contacts:
Scandic American Shipping Ltd
Manager for:
Nordic American Tanker Shipping Ltd.
P.O Box 56, 3201 Sandefjord, Norway
Tel: + 47 33 42 73 00 E-mail: nat@scandicamerican.com
Web-site: www.nat.bm
Rolf Amundsen, Investor Relations
Nordic American Tanker Shipping Ltd.
Tel: +1 800 601 9079 or + 47 908 26 906
Gary Wolfe
Seward & Kissel LLP, New York,
USA Tel: +1 212 574 1223
Herbjorn Hansson, Chairman & CEO
Nordic American Tanker Shipping Ltd.
Tel: +1 866 805 9504 or + 47 901 46 291
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.
NORDIC AMERICAN TANKER SHIPPING LIMITED
(registrant)
Dated: November 9, 2006 By: /s/ Herbjorn Hansson
--------------------
Herbjorn Hansson
Chairman, Chief Executive Officer
and President
SK 01318 0002 720069