The Athens, Greece-based containership lessor on July 26 said it would initiate a 1-for-6 reverse split “on or around” July 27, just a few weeks after another 1-to-7 reverse split went into effect July 5.
For the second time in under a month, Athens, Greece-based containership leasing company Diana Containerships Inc. has said that it is effecting a reverse stock split of the company’s common shares, and shares have plummeted as a result.
On July 26, the company said it would initiate a 1-for-6 reverse split “on or around” July 27. The company’s shareholders approved the reverse stock split and granted the Board of Directors the authority to determine the exact split ratio and proceed with the reverse stock split at the company’s annual shareholders meeting on June 29.
When the reverse stock split goes into effect, every six shares of issued and outstanding common stock will be automatically combined into one share of common stock, without any change to the per share value. This will reduce the number of outstanding common shares of the Company from about 6.1 million shares to a million shares, the company has said.
Shareholders with shares held in book-entry form or through a bank, broker, or other nominee should see the impact of the reverse stock split reflected in their accounts on or after the effective date.
Shareholders with shares held in certificate form will receive instructions from the Company’s exchange agent, Computershare, for exchanging their stock certificates for a new certificate representing the shares of common stock resulting from the reverse stock split.
The latest reverse split comes barely three weeks after a 1-for-7 split that went into effect July 5. Stock in the company, which traded at a high of $826/share in early 2011, sank to a record low of 20 cents per share Wednesday, following a one day drop of 57 percent, according to Nasdaq. The stock briefly rose to 95 cents per share at market opening on July 27, before beginning to fall again. Year-to-date, the company’s stock has fallen about 97 percent.
The news also broke just days after Diana Containerships reported its financial results for the second quarter and first half of the year. The company posted a net income of $36.5 million, and earnings per common share (EPS) of $18.39 per basic share and $17.27 per diluted share for the second quarter of 2017, compared to a net loss of $8 million, and an EPS loss of $6.13 per share (basic and diluted) for the same period in 2016.
For the six months ended June 30, Diana reported earnings of $29.1 million ($17.53 per basic share and $16.84 per diluted share), compared to a net loss of $13.8 million ($10.55 per share) for the same period last year.
As of June 30, the company said it had a cash balance of $11.6 million and outstanding debt balance of $117.2 million, compared to a cash balance of $17.3 million and outstanding debt of $172.7 million at the end of 2016.