Release Date: July 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Fleet utilization reached 99.5% in the second quarter of 2024, reflecting efficient vessel management.
- Secured revenue for 74% of the remaining ownership rate of 2024, amounting to approximately USD76.8 million.
- Declared a quarterly cash dividend of $0.075 per common share, totaling approximately USD9.4 million.
- Re-charted 8 vessels year-to-date with an average charter rate increase of 11%.
- Raised USD25.3 million from the exercise of warrants under the ongoing warrant program, with a further USD65 million possible.
Negative Points
- Reported a net loss of $2.8 million for the second quarter of 2024.
- Time charter equivalent rate decreased to USD15,106 compared to USD17,311 in the same quarter last year.
- Ownership days have decreased compared to the same quarter in 2023.
- The average Baltic time charter rate for Capesize vessels fell around 7%.
- Projected fleet growth of 2.5% in 2025 may outpace dry bulk trade growth of 1% in ton-miles.
Q & A Highlights
Q: Can you provide more details on the financial impact of the non-cash items mentioned in the net loss?
A: Ioannis Zafirakis, President and Interim CFO: The net loss of $2.8 million was influenced by non-cash items such as the pricing of warrants and our shareholding in OceanPal. Without these, we would have been on the positive side regarding net income.
Q: What is the current status of your fleet utilization and how does it compare to previous periods?
A: Semiramis Paliou, CEO: Our fleet utilization reached 99.5% in the second quarter of 2024, reflecting our efficient vessel management. This is a strong performance compared to previous periods.
Q: Can you elaborate on the refinancing activities and their impact on the company's debt profile?
A: Ioannis Zafirakis, President and Interim CFO: We refinanced all of our $125 million senior unsecured bonds due in 2026 with a $150 million placement in the Norwegian market. Additionally, we signed a $167.3 million, six-year secured term loan facility with Nordea Bank, releasing two previously mortgaged vessels.
Q: What are the expected delivery timelines for the new methanol dual-fuel Kamsarmax vessels?
A: Semiramis Paliou, CEO: We are expecting the delivery of two methanol dual-fuel newbuilding Kamsarmax dry bulk vessels around 2027 and 2028.
Q: How has the charter rate environment evolved in the second quarter?
A: Semiramis Paliou, CEO: The average Baltic time charter rate for Capesize vessels fell around 7%, while Panamax rates increased by 6% and Supramax rates rose by 16%. We secured profitable time charters for 8 vessels with an average charter rate increase of 11%.
Q: What are the key drivers behind the firm bulker demand in the Atlantic?
A: Anastasios Margaronis, President: The main drivers include Brazilian iron ore exports, Guinea bauxite exports, Brazilian grain exports, US East Coast coal and grain exports, and manganese ore shipments from West Africa.
Q: How is the company addressing environmental regulations and sustainability?
A: Semiramis Paliou, CEO: We are committed to promoting eco-friendly technologies, modernizing our fleet, and transparently sharing emission data. We have developed an equity diversity and inclusion program and continuously invest in our people.
Q: What is the outlook for the dry bulk market in the near term?
A: Anastasios Margaronis, President: The Capesize market is expected to benefit from firm Atlantic iron ore, bauxite, and manganese exports. However, there could be a small easing in markets in 2025 as dry bulk trade growth is projected to be slightly below fleet growth.
Q: How has the company's dividend policy evolved?
A: Ioannis Zafirakis, President and Interim CFO: Since the third quarter of 2021, we have accumulated $2.634 per common share in dividends. We recently announced another $0.075 per share for the quarter ending June 30.
Q: What are the key takeaways from the company's recent financial performance?
A: Semiramis Paliou, CEO: Despite a net loss influenced by non-cash items, we maintained strong fleet utilization and efficient vessel management. Our refinancing activities have strengthened our debt profile, and we continue to focus on fleet modernization and sustainability initiatives.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
