Containership giant Seaspan Corp is close to fully funding its massive newbuilding order programme as profit rises in hot markets.
The company, owned by New York-listed Atlas Corp, said 25 new vessels of 175,000 teu were contracted at shipyards in the third quarter.
This leaves a total of 69 still to be delivered, after the first in a series of 70 units was handed over in the period.
The order programme is costing $7.6bn and Seaspan has financing of $5.3bn in place for 60 vessels.
The shipowner, which has 132 ships on the water, said in its results report that talks are at an advanced stage for another $1.6bn of loans, covering the remaining 10 units.
These deals are expected to close at the end of this year.
Chief financial officer Graham Talbot added that "substantial progress" has been made on funding the newbuilding programme.
The group now has a contract backlog of $17.9bn.
60 charters sealed
Seaspan has entered into forward fixtures for 60 operational boxships so far this year, with no remaining charter roll-offs in 2021.
Six charters will end next year and another 19 in 2023.
Atlas' net profit was $94.6m in the three months to 30 September, up from $84.1m in the same period of 2020.
Seaspan's share of the earnings was $60.1m. Group revenue was up 17% to $451.9m.
Fearnley Securities said Ebitda of $308m was $14m short of estimates.
But the investment bank said liquidity is "strong" at $258m of cash and $700m of undrawn credit facilities.
This "gives comfort" in the context of the newbuilding programme.
Seaspan has 33 debt-free ships worth $1.2bn, "which we consider highly liquid assets in the current boiling hot container market", Fearnley added.
"The unencumbered vessels are also highly bankable, which offers another option to free up liquidity should that be necessary," the investment bank said.
Big cash flow ahead
With gradual deliveries through to 2024, Seaspan will generate substantial cash flow to further strengthen and gradually de-leverage its balance sheet, Fearnley believes.
Atlas and Seaspan chief executive Bing Chen said: "Our team continued to exceed expectations by delivering operational excellence and strong financial performance during the third quarter of 2021."
He added the financial result had been unaffected by port congestion and supply chain disruptions.
"We are working closely with our customers through these operational challenges by leveraging our fully integrated platform to maintain industry-leading operational performance," Chen said.
