Q2 2022 Euroseas Ltd Earnings Call

Speaker 1: Thank you for standing by. Ladies and gentlemen, and welcome to the EuroC's conference call on the second quarter 2022 financial results.

Thank you for standing by ladies and gentlemen, and welcome to the <unk> Conference call on the second quarter 2022 financial results.

Speaker 1: We have with us Mr. Aristides Pufas, Chairman and Chief Executive Officer, and Mr. Tostos Aslides, Chief Financial Officer of the company.

We have with US Mr. Aristides Peters, Chairman and Chief Executive Officer, and Mr taught us that bleeding Chief financial Officer of the company at this time all participants are in a listen only mode there'll be a presentation followed by a question and answer session at which time if you wish to ask a question. Please press star one on your telephone keypad.

Speaker 1: At this time, all participants are in a listen-only mode. There will be a presentation followed by a question and answer session, at which time, if you wish to ask a question, please press star 1 on your telephone keypad and wait for the automated message advising your line of open. I must advise you that this conference call is not a

Wait for the automated message advising your line is open.

I must advise you that this conference call is being recorded today.

Please be reminded that the company announced their results with a press release that has been publicly distributed.

Speaker 1: Please be reminded that the company announced their results with a press release that has been publicly

Speaker 1: Before passing the floor to Mr. Pethis, I would like to remind everyone that in today's presentation and conference call, the ROCs will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements which are based on current management expectations that involve risks and uncertainties that may result in such expectations not beingExsama PLAYFeat. Harbour stream.

Before passing the floor to Mr. Peters I would like to remind everyone that in todays presentation and conference call.

We'll be making forward looking statements. These statements are within the meaning of the federal Securities laws matters discussed may be forward looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.

I kindly draw your attention to slide number two of the webcast presentation, which has the full forward looking statement.

Speaker 1: I kindly draw your attention to slide number two of the webcast presentation, which has a full forward looking screen.

Speaker 1: and the same statement was also included in the press release. Please take a moment to go through the...

And the same statement was also included in the press release.

Please take a moment to go through the whole statement and read it.

Speaker 1: And now I would like to pass the floor to Mr. Peters. Please go ahead.

And now I would like to pass the floor to Mr. Peter. Please go ahead Sir.

Good morning, ladies and gentlemen, thank you all for joining us today for our scheduled conference call.

Speaker 2: Good morning ladies and gentlemen. Thank you all for joining us today for our scheduled conference call. Together with me, Stasos Eslilis, the three financial officers.

Together with me statutes of lease up Chief Financial Officer.

The purpose of today's call is to discuss our financial results for the six months period that ended June 32.

Speaker 2: The purpose of today's call is to discuss our financial results for the six month period and court that ended June 30th of 2022. Let's turn to slide three.

2022.

Let's turn to slide three.

The income statement highlights are shown here.

The second quarter of 2022 was another great quarter for us producing the best results since our inception.

Speaker 2: The second quarter of 2022 was another great quarter for us, producing the best results in 7 steps.

You've been an extremely high it sounds the covenants for the remainder of the year. So it'll move through 'twenty 'twenty four we expect to be able to deliver a robust profitability for the next couple of years, regardless of market development.

Speaker 2: with an extremely high chartered coverage for the remainder of the year through to 2024, we expect to be able to deliver a robust profitability for the next couple of years, regardless of market development.

For the second quarter of 2022.

Speaker 2: For the second quarter of 2022, we reported total net revenue for $48.5 million and net income of $30.7 million or $4.24 per share diluted.

Total net revenues were $48 $5 million and net income of $37 million or $4.24 per share.

Diluted.

Adjusted net income attributable to common shareholders was $29 $6 million.

Speaker 2: Just net income attributable to common shareholders was $29.6 million or $4.08 per share valued.

Falling to zero $8 per share diluted.

Adjusted EBITDA for the period stood at $74 $2 million.

Speaker 2: The adjusted EBITDA for the period stood at $34.2 million.

That's part of the company's common stock dividend plan. Our board of directors has declared a quarterly dividend of 50 cents per share for the second quarter of 2022, which will be payable on or about September 16th 2022% from digital Greco on September nine 2022.

Speaker 2: As part of the company's common stock dividend plan, our board of directors has declared the quarterly dividend of 50 cents per share for the second quarter of 2022, which will be payable on or about September 16, 2022 to shareholders of Rekop on September 9, 2022.

It sounds like quite a response to a yield of about 7%.

Speaker 2: This annualized corresponds to a yield of about 7%.

I suppose a little looser than 2022.

Speaker 2: As of August 10, 2022, we have repurchased $40,000 shares of our common stock in the open market for about $900,000.

But just for.

$2000.

<unk> shares of our common stock in the open market for about 900000 downloads.

And then I have said expenses plan of up to $20 million, which was announced in May 2022.

Speaker 2: under our shared purchase plan of up to $20 million, which was announced in May 2022.

That's those will go over the financial highlights in more detail later in the presentation.

Speaker 2: we'll go over the financial highlights in more detail later in the presentation.

Speaker 2: Please turn to slide four where we discuss our recent chartering and operational development.

Please turn to slide four where I will discuss our recent chartering and operational developments.

During the second quarter, we took delivery of the motor vessel demand will be and most of the vessels. The retinopathy on May 24, and June 27%, respectively.

Speaker 2: During the second quarter, we took the liberty of Moto Bessel Emmanual P and Moto Bessel Renape on May 24 and June 27 respectively.

Both vessels kind of a capacity of 4250, the UES and rebuilt and 205 and two O seven.

Speaker 2: Both vessels have a capacity of 4,250 dEu each and were built in 2005 and 2007.

Yeah.

Okay.

Speaker 2: There were no new chapters this quarter, as all our vessels are fixed until the fourth quarter of 2022.

No new Charleston risk off as.

All our vessels are fixed until the fourth quarter of 2022.

Regarding the embarrassment drydocking.

E M E direct comment for a second.

Speaker 2: EME direct comment for second schedule the dry dock, which was completed in the first third quarter of 2022. There were no ideal vessels.

During the trial, which was completed in the first time to go through 2022.

There were no items vessels during the scope.

Please turn to slide five where you can see our fleet put them aside.

Speaker 2: Please turn to slide 5 where you can see our sleep profile.

Our current fleet consists of 18 vessels, including 10 fees eliminate intermediate container ships.

Speaker 2: Our current fleet consists of 18 vessels, including 10 feeder and 8 intermediate container ships, with a cargo capacity of close to 60,000 TEU and an average age of 17 years, weighted by size and TEU.

The cash flow capacity of close to 60000, Teu and the Netherlands rates of 17 years.

Weighted by size in Teu.

Speaker 2: Turning to slide six, we present our vessels under construction, which consists of nine feeder container ships, which are expected to be delivered in 2023 and 2024.

Turning to slide six.

<unk> vessels under construction, which consist of 93 to container ships, which are expected to be delivered in 2023 and 2024.

The 90 feed the containership new buildings will have a capacity of 22000 Teu.

Speaker 2: The nine feeder containers with new buildings will have a capacity of 22,000 TEU.

After the delivery of these new buildings, our fleet will consist of 27 vessels with a total carrying capacity of approximately 81000 Teu.

Speaker 2: After the delivery of these new buildings, our fleet will consist of 27 vessels with a total carrying capacity of approximately 81,000 tU.

Slide seven shows our vessel employment schedule.

Speaker 2: As you can see, fixed rate coverage as of the end of Q2 2022 stands at approximately 78% for the remainder of 2022, 78% for 2023 and almost 54% for 2024.

As you can see fixed rate calculated as over the end of Q2 2022 stands at approximately 98% for the remainder of 2022, 78% for 2023 and almost 54% for 2024.

Let's now turn to slide nine to review how the six to 12 month time charter rates have developed in the last decade.

Speaker 2: now come to slide 9 to review how the 6th to 12th month time shorter rates have developed in the last day.

Speaker 2: Charter rates were low across all segments until mid-2020.

Now I'll turn rates were low across all segments until mid 2020.

Speaker 2: But since the onset of the pandemic, they have dramatically improved, hosting all-time highs.

Since the onset of the pandemic they have dramatically improved posting all time highs.

Speaker 2: Even though rates started retreating towards the end of 2021, they jumped to new heights during the first half of the year.

Even though rates started increasing towards the end of 2021 the jumped two new colleagues during the first half of the year.

Speaker 2: The last few months, rates appear to have decreased due to a number of reasons, including a lack of demand for longer term charters, meaning three years plus, partly due to the limited availability of vessels and partly because of the wait and see approach of charters, as well as lower demand for the transportation of finished goods, which is triggered by the uncertainty surrounding the ongoing geopolitical and global economy.

In the last few months rates appear to have decreased due to a number of reasons, including a lack of demand for longer term charters, meaning three years plus.

Partially due to the limited availability of basins and partly because of the wait and see approach.

Please.

As well as lower demand for the transportation of finished goods, which is triggered by the uncertainty surrounding the ongoing geopolitical and global economic events.

Speaker 2: Nevertheless, rates still remain at record highs by any historical comparison.

Nevertheless, Nevertheless.

Still remain at record highs, but you hadn't historical comparisons.

Please turn to slide 10, where we summarize the containership market highlights for the second quarter of 2022.

Speaker 2: And we will be in the sequence like 10 where we summarize the stats for the second quarter of 2022.

And the charter rates across all segments declined slightly over the past 15 months, but there are still higher than the start of 2022 more than four times higher than that at the end of 'twenty traded and still well above the historical median over the last 12 years.

Speaker 2: Time Sutter rates across all segments declined slightly over the past three months, but are still higher than at the start of 2022, more than four times higher than at the end of 2020 and still well above the historical median of the last 12 years.

You can go into the second hand price index, because at least on average by about 3% in the second quarter of 2022 over the previous calls to secondhand prices remain very high historically.

Speaker 2: Even though the second-hand price index decreased on average by about 3% in the second quarter of 2022 over the previous quarter, second-hand prices remain very high this morning.

Speaker 2: Generally speaking, the market softened a bit in the second quarter as the world in Ukraine raised uncertainty and diminished appetite for any investment.

Generally speaking the market has softened a bit in the second quarter as the world in Ukraine, the raised uncertainty and diminished appetite for any investments.

In the meantime, the new building prices decreasing by about two 6% in the second quarter of 2022 over the past quarter.

Speaker 2: In the meantime, the new building price index increased by about 2.6% in the second quarter of 2022 over the past quarter.

Speaker 2: In fact, new building prices for container ships rose even further in the second quarter against the backdrop of decreasing slope availability at yards, rising building costs, manpower costs and edits.

In fact, new building prices for container ships slows even further in the second go against the backdrop of decreasing slot availability at yards.

Rising building costs manpower costs and energy costs.

The container ship fleet has grown by approximately 2% year to date without accounting for the vessels to the activation or lightly.

Speaker 2: The container ship fleet has grown by approximately 2% year to date without accounting for either questions or reactivations or a

The idle containership fleet as of July 18, 2022 stands at about 49% of the fleet and has remained stable during the last year the lowest levels.

Speaker 2: The ideal container ship fleet as of July 18, 2022 stands at about 49% of the fleet and has remained stable during the last year at the lowest level.

Speaker 2: However, this number includes Iranian sanctions ships and ships that were involved in blank sailings due to lockdowns in China during May and June , bringing the actual number of ships really idle and inoperable to a very low number.

However, this number includes the Iranian Samsung ships and ships that are involved in blank sailings due to lockdowns in China during may and June bringing the actual number of ships severely idled an inaugural moved to a very low number.

Speaker 2: The container ship market conditions still being exceptionally strong. No container ships have been sold for recycling so far this year. None are expected to be recycled by the end of the year.

With container ship market conditions still being exceptionally strong no container ships have been sold or is tracking so far this year and none I would expect it to be recycled by the end of the year.

Speaker 2: By and large, it has been the quietest period for container ship scrapping since 2006.

By and large it's has been the quiet period for containership scrapping since 2006.

Kathryn prices fell sharply to about six becomes a dollars per lightweight ton in the second quarter of 'twenty to 'twenty two.

Speaker 2: Gapping prices fell sharply to about $6,000 per lightweight on the second quarter of 2022.

The prices were clearly impacted by currency depreciation and the softening of the steel markets locally.

Speaker 2: prices were clearly impacted by currency depreciation and the softening of the steel market slope.

Speaker 2: In addition, these prices are based on a very shallow market with no transactions reported, and only available bids much lower than what owners are willing to accept.

In addition, these prices are based on a very shallow market with no transaction, which has been posted and only available bid much lower than what the owners are willing to accept.

Yeah.

Please turn to slide 11.

The global GDP growth forecast has been further reduced for 2022. According to the IMS lasers to the poll as several global events have hit the wall.

Speaker 2: The global GDP growth forecast has been further reduced for 2022 according to the IMF's latest report as several global events have hit the world economy already weakened by dependence.

As the economy all of anything we can do different then.

They only go into geopolitical conflict between Russia, and Ukraine added to existing inflation issues.

Speaker 2: The ongoing geopolitical conflict between Russia and Ukraine added to existing inflation pressures that had already started building up due to the economic stimuli provided during the pandemic, which triggered stricter monetary policies, including a series of aggressive interest rate hikes to help address inflation.

It already started building up due to the economic stimuli provided during the pandemic.

We've strengthened.

Undeterred policies, including a series of aggressive interest rate hikes to help address inflation.

We've elevated the energy prices, mainly due to the Russian grain conflict and lingering supply chain issues as well as additional slowdowns due to sporadic COVID-19, lockdowns in the property sector crisis that may further surplus Chinese growth.

Speaker 2: We've elevated energy prices mainly due to the Russia-Ukraine conflict and lingering supply chain issues, as well as additional slowdowns due to sporadic COVID-19 lockdowns and the property sector crisis that may further suppress Chinese growth. The IMF lowered its global GDP estimates from 3.6% to 3.2% for this year and to 2.9% for 2021.

<unk> lowered its global GDP estimates from three 6% to three 2% for this year.

Two 9%.

Sweet.

GDP growth for the United States was revised downwards to two 3% for 2020 to the one four percentage points lower from a from the forecast due to lower growth in tighter monetary policies.

Speaker 2: GDP growth for the United States was revised downwards to 2.3% for 2022, the 1.4% point lower from April's forecast due to lower growth and tighter monetary policy.

Speaker 2: Similarly, European growth has dropped to 2.6%, resulting from the Russian-Ukraine conflict and tighter monetary policy.

Similarly European goes because it dropped to two <unk>.

6%, resulting from the Russian clinical data monetary policies.

Speaker 2: Due to major global spillovers caused by its various regional issues, China's growth was also revised down to 3.3% for 2022, a 1.1% difference from April 4.

Due to major global spillovers caused by its regional issues. China is good Olaf was also revised down to three 3% for 'twenty two.

One one percentage difference from the <unk> focus.

Speaker 2: Growth in emerging markets and developing economies is also expected to sharply accelerate.

Growth in the emerging markets and developing economies is also expected to sharply.

She loves it accelerated.

Speaker 2: and India's forecast has been revised down to 7.4% for 2022 and 6.1 for 2023. While the only country with better forecast this quarter seems to be Brazil with an anticipated growth of 1.7% in 2022 from 0.8% previously. Due to the robust...

And the Indias forecast has been revised down to seven 4% for 'twenty, two and $6 one for 2020.

While the only country with better forecast this quarter seems to be Brazil within the anticipated growth of one 7% in 2022.

8% previously.

Due to the robust cargoes in Latin America.

From the developed economies in Japan, and the Asia in five because <unk> have also been revised downwards.

Speaker 2: From the developed economies, Japan and the Asian side have also been revised downwards for 2022 and 2023 due to concerns about slowing economies following the US interest rate hike and ongoing inflation.

2015, due to concerns about slowing economies following the U S interest rate hike and ongoing inflation.

Speaker 2: Looking at the containerized trade and according to Clarkson Research Demand, demand is expected to decline by 0.6% in 2022 compared to 6.5% growth for the previous year.

Looking at the containerized trade and according to Clarkson research demand demand is expected to decline by.

6% in 'twenty to 'twenty, two compared to six 5% growth for the previous year.

For 2023, containerized trade is projected to grow by two 3%.

Speaker 2: So 2023 containerized tray is projected to grow by 2.3.

The rate on growth projections are being continuously by the effects of the lockdowns in China and geopolitical tensions between Russia and with good day on world growth and today are being continuously reassess.

Speaker 2: Rate and growth projections are being continuously revised as the effects of the lockdowns in China and geopolitical tensions between Russia and Ukraine on world growth and trade are being continuously reassessed.

Please turn to slide 12.

The containership fleet is relatively young with most vessels under 15 years old and only 9% of the fleet over 20 years old.

Speaker 2: The container ship fleet is relatively young, with most vessels under 15 years old, and only 9% of the fleet over 20 years old.

The right side shows the delivery schedule of the government containment support which is expressed as a percentage of the fleet.

Speaker 2: The right side chart shows the delivery schedule of the current fantasy folder book which is expressed as a percentage of the play.

The circle figures for 2022 to 2025.

Speaker 2: circle figures for 2022 to 2025 reflect the anticipated fleet growth before any scrapping is sleeping.

<unk> anticipated fleet growth before any scrapping and slippage.

Clarksons expects new deliveries.

Speaker 2: Larchos expects new deliveries of about 4.5% of the current leads to be delivered in 2022, 9.5% in 2023 and 9.7% in 2023.

Four 5% of the chasm leads to be delivered in 295% in 2020 to be nine 7% in fiscal 'twenty four.

Speaker 2: Currently, the total container support group stands at 27.8% of the fleet, and the majority of the deliveries are scheduled for the second part of 2023 onwards.

Currently the total containership order book stands at seven 8% of the fleet and the <unk>.

And given the deliveries are scheduled for the second part of 2023 onwards.

Speaker 2: Please turn to slide 13 where you can see the fleet age profile in Nuremberg for ships from 1000 to 3000 TU.

Please turn to slide 13, where you can see the fleet age profile for.

For <unk> from 1000 to 3000 Teu.

As can be seen here the number of vessels in this size range that are older than 20 years with 22%.

Speaker 2: can be seen here the number of vessels in this size range that are older than 20 years is 22%.

Speaker 2: much larger than the 9% for the average of the fleet shown in the previous slide.

Much larger than the 90% for the algorithms from the fleet shown in the previous slide.

Also the total of all of this size bracket is under 14%.

Speaker 2: Also, the total order between these size brackets is under 14%. About half of that...

About half of that of the whole fleet.

In other words, the supply dynamics for the smaller sizes.

Speaker 2: In other words, the supply dynamics for the smaller sizes are much more favorable than for the biggest.

The more favorable than for the bigger ships.

This was one of the primary reasons for the us traction.

Speaker 2: This was one of the prime reasons for us structuring a new building program around this site.

New building program around these sizes.

Please turn to slide 14, where we'll discuss our outlook summary for the containership market.

Speaker 2: This is slide 14 where we discuss around the summary for the containers.

Speaker 2: Crater rates have dropped by about 10 to 20 percent from recent records.

So after rates have dropped by about 10% consent from recent record highs, while freight rates have fallen silica, 20% to 30% below historical site.

Speaker 2: while phrase rates have fallen 20% below historical.

Speaker 2: Nevertheless, the both still remains spectacular.

Nevertheless, they both still remains spectacular.

Yeah.

Whereas on container trade cause increased macroeconomic headwinds lockdowns in China, they're also creating conflict inflationary pressure on consumers will shift back towards certain spending has impacted volumes.

Speaker 2: Pressure on container trade has increased as macroeconomic headwinds, lockdowns in China, the Russia-Ukraine conflict, inflationary pressure on consumers, and a shift back to world service spending have impacted volumes.

Ongoing disruption caused by port congestion remains extremely supportive to the charter market despite rate volumes from 'twenty to 'twenty two.

Speaker 2: Ongoing disruption caused by port congestion remains extremely supportive to the charter market despite great volumes in 2022, having...

Having come under pressure.

That translates to come so no material signs of softening edging down only marginally.

Speaker 2: Charter rates have shown no material sign of softening, adding down only marginally. But charters appear reluctant to fix longer periods or fix fifty-four...

Charter routes appear reluctant to fix longer periods for fixed pool.

And fourth conversion likely to take time to EV demand.

Speaker 2: The fourth conception likely to take time to ease demands remains above pre-COVID levels, despite the nature of headwinds and the moderate fleet expansion.

Demand remains above pre COVID-19 levels. Despite the major headwinds and then moderate fleet expands container market conditions look likely to remain positive in Brazil.

Speaker 2: Container market conditions look likely to remain positive in the short term.

Speaker 2: consequently, we expect the remainder of 2022 to remain strong.

Subsequently, we expect the remainder of 2020 to do remain strong.

Speaker 2: However, in 2023, increased deliveries, easing of port congestion and demand destruction should take their toll and charter rates should decline.

However, in 2023 increased daily living easing of both conversion and demand.

So take that all in charter rate should decline significantly.

Looking beyond 2023 fundamentals are complex with a range of factors likely have an impact including the direction of global growth of age.

Speaker 2: Looking beyond 2023, fundamentals are complex with a range of factors likely to have an impact, including the direction of global growth rates, which may move in either direction depending on the size, control and circulation in the outcome of the Ukraine-Russia war.

It may move in either direction, depending on the site control inflation in the outcome of the war.

Material supply question from 'twenty to 'twenty three.

Speaker 2: material supply pressure from 2023 onwards, which may overtake demand growth. And lastly, new environmental regulations, which will probably result in even slower stealing by 2023 to 2024, effectively removing capacity from the market.

With me on with data demand growth and lastly, new environmental regulation, which will probably result in England slow steaming.

Good.

Sure.

Actively removing capacity from the market.

Let's move to slide 15.

Speaker 2: The left side of the slide shows the evolution of one year time shorter rate for containers with a capacity of 2500 pU since 2010.

The left side of the slide shows the evolution of one year time charter rates for containment with a capacity of 2500 Teu since 2010.

Speaker 2: According to Klarsens, as of August 5th, the one-year daily time chart arranged to pull the 1000PU container sits stood at $72,500.

Equivalent cloud soon as well what was.

The one year daily time charter rates deployment cost.

You can pay.

At $72500 somebody.

The right side of the slide shows the historical price today for the new building and the 10 year old campaign.

Speaker 2: The right-hand side of the slide shows the historical price range for a new building and the 10-year-old container ship with a capacity of 2,500.

With the capacity.

Yeah.

I was just going to see secondhand prices increased significantly enhancing charter rates during the last two years.

Speaker 2: As you can see, second-hand price has increased significantly in tangent chartered rates during the last two years.

However, the increase in prices for new buildings was muted.

Speaker 2: However, the increase in prices for new buildings was neutral.

The second reason the confidence to invest a significant part of the proceeds you could speak to the new building vessels.

Speaker 2: This was the second reason that prompted us to invest a significant part of the process to secure a new building plan.

The first being the underinvestment in smaller size basis as already discussed.

Speaker 2: The first being, beyond their investment in small described vessels as already.

The third and probably the most important reason putting in place our new building program was the fact that due to environmental concerns the world.

Speaker 2: And probably the most important reason for putting in place our new building programme was the fact that due to environmental concerns the world will need new, more economical, Crazy or racks and stir

More economical basis.

Speaker 2: These shapes, which consume nearly half the fuel that all the vessels do, will have reached a transition to a greener empire.

These ships, which consumes nearly half the fuel bill.

The vessels do we left these systems vision.

Greener and five of them.

Speaker 2: We are confident that this will be appreciated by the markets too, in rewarding our vessels with higher charters than for industry.

We are confident that this will be appreciated by the markets too and the rebuilding of vessels with higher Charleston has been for vendors ships.

Indeed, this has been the case for the first two vessels.

Speaker 2: Indeed, this has been the case for our first two vessels that have been forward chartered for three-year periods starting upon their deliveries in the first half of 2023 at $48,000 a day.

It hasn't been for Woodside for three year period start picking upon the deliberate.

First half of 'twenty three.

$48000 per day.

Speaker 2: rate which will pay the full investment in just three years.

Right, which is basically full investment in just three years.

Speaker 2: Even our chartered fleet between now and the end of 2024 has very profitable rates that are to generate significant cash flow reserves.

Even though trusted fleet between now and the end of 'twenty 'twenty four is very profitable at the top.

To generate significant cash flow reserves.

Speaker 2: We intend to use the cash flow we are generating, not only to fund the equity portion of the market, but also to fund the equity of the market. Thank you very much. Thank you.

Intends to use the cash flow, we are generating not only to fund the equity portion.

Speaker 2: of our 9 vests in new building program, but to also reward our shareholders via our ongoing dividend and share repurchase program.

<unk> thousand nine vessel New building program, but also these woes that are SaaS holders.

Our ongoing dividend and share repurchase program.

Notwithstanding the above we will still have a significant war chest to pursue other investment opportunities, which can be accretive to our shareholders when such opportunities arise.

Speaker 2: notwithstanding the above, we will still have a significant process to pursue other investment opportunities which can be a critical to us shareholders when such opportunities are available.

And with that I will now pass the floor to our CFO pasture facilities to go over our financial highlights in further detail.

Speaker 2: And with that, I will now pass the floor to our CFO , Tasso Cessilides, to go over our financial highlights in further detail.

Thank you very much.

Good morning for me as well.

Speaker 3: Good morning from me as well, late in the morning. As usual, I will now take you through the next five slides of our presentation and give you another view of our financial highlights for the second quarter and third half of 2022 and compare them to the same periods of last year. For now, let's turn to slide 17.

Ladies and gentlemen, thank you Joe.

Thank you we'll go next slides of our presentation.

Are you an overview.

Financial highlights for the second quarter and first half of 2022.

For the same periods of last year.

Well, let's turn first to slide 17.

The company reported total limit there.

For the second quarter were $48 5 million, representing a 5% increase over total net revenues.

Speaker 3: for the second quarter of 48.5 million, representing a 165% increase over top net revenues of 18.3 million during the second quarter of 2021. The increase being the result of the increased time chart rate our vessel earned in the second quarter of this year compared to last.

$18 3 million during the second quarter of 2021.

Being very strong.

Time charter rates on the vessel in the second quarter of this year compared to last inbound.

Sure.

Speaker 3: Due to the increase in the average number of vessels, we own and operated in the second quarter of this year, compared to last year.

Due to the increase in the average number of vessels, we own and operated in the second quarter of this year again comparison last year.

The company reported a net income and net income attributable to common shareholders for the period.

Speaker 3: The company reported a net income, a net income attributable to common shareholders for the period of 30.7 million as compared to a net income of 7.9 million. A net income attributable to common shareholders of 7.6 million respectively for the same period of 2021.

First the $47 million as compared.

Compared to a net income second $49 million and net income attributable to common shareholders of $7 6 million respectively.

Since the end of 2021.

Speaker 3: The Internet and other financing costs for the second quarter of 2022 amounted to $1.1 million compared to $0.7 million for the same period of 2021.

Interest and other financing costs.

For the second quarter 2022 amounts.

[noise] amounted to $1 1 million compared to <unk> <unk> second media for the same period of 2021.

Speaker 3: This increase is due to the increased amount of debt and the increase in the weighted public library that we see in the current series compared to the same series of lectures.

This increase is due to the increased amount of debt.

The increase in the weighted average LIBOR rate.

Okay. The current senior compared to the same period last year.

Speaker 3: adjusted TPDAC for the second quarter of 2022 was $34.2 million compared to $10.3 million achieved during the second quarter of 2021. In the case of $231 million, the total number

Adjusted EBITDA for the second quarter of 2022 worse.

<unk> 2 million compared to $10 3 million achieved during the second quarter of 2021 and in case of 251%.

Earnings per share attributable to common shareholders for the <unk>.

Fourth quarter of <unk>.

We're $4 26.

And $4 24.

Speaker 3: basically diluted, calculated on about 7.2 million...

Basic and diluted calculation on Chevron and about $7 million.

Weighted average number of shares outstanding.

Compared to basic and diluted earnings per share of one.

<unk>, two <unk> and 111.

Speaker 3: respectively for the second quarter of 2021, calculated on 6.8 million approximately, basically the way this average number of shares.

Respectively for the second quarter of 2021 calculated on $6 8 million approximately basic and diluted weighted average number of shares outstanding.

Excluding the effect on the income attributable to common shareholders.

Speaker 3: excluding the effect on the income attributable to common shareholders of the unrealized...

The unrealized gain and gave us the amortization of below market time charter stock why.

Speaker 3: the amortization of below market time charges acquired.

Speaker 3: and the depreciation chart due to the increased value of the vessels acquired with below market time charters. The adjusted earnings are attributable to common shareholders for the quarter, which have been $4.1 per share basic and $4.08 per share diluted.

And then depreciation charge due to the inherent value of the vessels acquired with below market time charters.

Adjusted earnings attributable to common shareholders for the quarter would have been.

Sure.

$1, seven basic and for being here $8 percent diluted.

Secondly, compared to our adjusted earnings of $1 12.

Speaker 3: Technically compared to adjust the parents of $1.12 space to dilute According to Dr.

Basic and diluted.

For the quarter ended June 32021, well last quarter, if we excluded the angry allies loss from derivatives.

Speaker 3: quarter ended June 30th, 2021. What quarter we excluded the unrealized loss in the...

Speaker 3: Usually, security analysts do not include the above items.

Was there any secured download which did not include therefore of items.

Speaker 3: in the public estimates of fairness for sure, that's why we're making the video.

The pharmacy fulfillment center, that's why we're making via truck.

Now, let us look at the numbers for the six months period.

Speaker 3: Now let us look at the numbers for the 6- knot period.

For the first half of 'twenty two.

Speaker 3: In the first half of 2022, the company reported total net revenues of $93.9 million, representing an 188% increase, over total net revenues of $32.6 million for the first half of 2021.

<unk> reported net revenues of 93 9 million.

There anything in the foundry and an 88% increase over total net revenues was $32 6 million for the first half strength to Antoine.

We reported net income and net income attributable to common shareholders for the period and the first half $60 7 million.

Speaker 3: We reported an net income, an net income attributable to common share coverage for the period in the first half of 60.7 million.

Speaker 3: Compared to an income of 11.7 million, an income applicable to common shareholders of 11.1 million for the first half of 2021, there is an Rite of Governing Greet.

<unk> to net income of 11 7 million and net income attributable to common shareholders.

$11 1 million for the first half of 'twenty, 'twenty, one and engage a 445%.

Interest and other financing costs for the first half of <unk>.

Speaker 3: In this another financial cost for the first half of 2022, amounted to $2.1 million, compared to $1.4 million …

Amount of $2 1 million.

Baird.

One 4 million for the same theatres with 2021.

This increase again due to the increased amount of debt in theory.

Speaker 3: increase again is due to the increased amount of death in theory and the increase in the address LIBOR we paid for the theater.

Occasionally average LIBOR based product period.

Adjusted EBITDA for the first half of 2022 were $65 3 million compared to $15 9 million for the same period, the first half of 2021.

Speaker 3: Jackie Pidet for the first half of 2022 was 65.3 million compared to 15.9 million for the same period the first half of 2020.

Speaker 3: Air means fresh air are attributable to common stress for the first class of 2022 where $8.40

Earnings per share.

The book to common stockholders for the first half of 2022.

Were $8, 4% basic.

Okay.

Calculated on seven 2 million average number of shares outstanding.

Speaker 3: calculated on 7.2 million, an average number of shares outstanding.

An 836% diluted.

Speaker 3: and 8.36 dollars per set diluted

Calculated from seven 3 million.

Speaker 3: calculated to 7.3 million average weighted number of shares outstanding compared to basically the turn-ins per share of $1.65 and $1.64 respectively with the first cleanse scheme with the quick

Weighted number of shares outstanding compared to basic and diluted earnings per share of $1 65.

And $1 60.

<unk> with respectively from the first half of 2021.

Again, excluding the effects from the income attributable to common shareholders for the firm.

Speaker 3: Again, excluding the effect from the income attribute of the common shareholders for the first half of this year, of the unrealized gain in the derivatives, the amortization of below market time chart to acquire, and the depreciation chart, the increased value of the version Both off wide with below market targets & kickoffs I do think that's a really important tip

First half of this year.

Unrealized gain on derivatives.

The amortization of below market client supplier.

<unk> charged the increased value of the vessels required with below market charges, the adjusted earnings per share.

Speaker 3: The adjusted earnings per share to the common shareholders for the six-month period would have been $7.81 basic and $7.77 diluted compared to adjusted earnings of $1.58 per share.

Common shareholders for the six month period.

$200 for Nate one basic instead of Angola.

Diluted compared to adjusted earnings were 158%.

Okay.

Speaker 3: share a basic and 1.57 dollars per share diluted for the same period of 2021. Again, subtraction for that period the unrealized gain of derivatives and the loss of a sale of...

And $157 per share diluted for the same.

This year, 20% again.

From products being the unrealized.

Realized gains.

And the loss on sale of protection.

Let's now move to slide 18 to review our fleet performance.

Speaker 3: Let's now move to slide 18 to review our flip report.

We will stop our review by looking first at our fleet utilization rate for the second quarter.

Speaker 3: We will start our review by looking first at our fleet utilization rates for the second quarter of 2022 in comparison to 2020.

Two in comparison to <unk>.

One.

Speaker 3: user, our utilization rate is broken down to commercial and operational.

Our fleet utilization rate was working down to <unk>.

Speaker 3: In the second quarter of 2022, our commercial utilization rate was 100%, and our operational utilization rate was 99.7% compared to 100% commercial, 99% of the rational for the second quarter of 2020.

The second quarter reflected 22 are commercially.

Right.

And our operational utilization was 99, 7% compared to 100% from axiom.

99% operational for the second quarter of last year.

I'm Robert <unk>.

Speaker 3: On average, 16.43 vessels were owned and operated during the second quarter of this year, earning an average time-saucer equivalent rate of $33,714 per day, compared to 14 vessels that we own and operate.

$16 four to three vessels were owned and operated during the second quarter of this year and an average time charter equivalent rate.

<unk> $3714 per day.

Back to 14 vessels that we own and operate in the second quarter of 2021.

Speaker 3: the second quarter of 2021, earning an average of $40,853.

An average of $14853 per day.

Our total operating expenses, including management fees <unk> expenses.

Speaker 3: Our total operating expenses, including management fees, GMA expenses...

Speaker 3: but excluding guidance in cost, average $7,732 per vessel per day during the second quarter of this year, compared to $6,806 per vessel per day for the second quarter of 2021.

But excluding Banco <unk>.

Several governments over the counter and therapeutic dollars per vessel per day during the second quarter of this year compared to 6000 $8060 per vessel per day for the second quarter of 2021.

Yeah.

Further down in this table, we can see the cash flow breakeven rate for the second quarter of 2022.

Speaker 3: Farther down in this table, we can see the cash flow break-even rate for the second quarter of 2022, which in addition to the operating costs mentioned above, takes into account interest expenses, direct open expenses and loan repayments, excluding our balloon repayments.

In addition to the operating costs mentioned above CHF four crowd interest expenses very certain expenses and loan repayments, excluding our balloon repayments.

Speaker 3: Thus, during the second quarter of 2022, our daily cash flow rate given rate was $13,561 per day compared to $9,937 per day for the same period of the second quarter of last year, with a big part of the difference being compounded by the prior loan statements made during the second quarter of 2022.

During the second quarter of Grand occurring between our daily cash flow breakeven was $15561.

Most of our vessel per day.

<unk> $9537 per vessel per day for the second quarter of last year with a big part of the difference being that Congress by the car here loan payments made during these periods.

Next let's go over to our utilization rate in the remaining of the figures for the first half of the year.

Speaker 3: Next, let's go over to our utilization rate and the main procedures for the first half of the year. Compare them again to the same...

Compare them against the same period.

Great.

During the first half of 'twenty.

Speaker 3: During the first half of 2022, our commercial utilization rate was 99.8% and our operational utilization rate was 99.6% compared to a 100% commercial and 98.3% operational utilization rate for the same period the first half of last year.

Our commensurate mutation rate was 99, 8% and our production utilization rate and 99, 6% compared to 100% Commerciality and 98, 3% operational utilization rate for the same period, the first half of last year.

We own and operate.

Speaker 3: 16.23 vessels in the first half of 2022, earning another time-chart equivalent rate of $33,843 per day, compared to 14 vessels earning $13,523 per day during the first half of 2020.

$16 23 vessels in the first half of 2022, and I think another time charter equivalent rate of 33, followed a staggering $43 per day compared to 14 vessels, earning $13523 per day during the first profitable strength.

Speaker 3: Total of their expenses again using management fees GNA expenses

Our total operating expenses again, including management fees and G&A expenses.

Speaker 3: before dry-dosing costs were $7,554 per day.

<unk> very good.

7534 Boes per day.

During the first half of this year compared to $6887.

Speaker 3: during the first half of the year, compared to $6,887 per vessel per day for the same period of 2020.

<unk> per day for the same period.

2021.

Speaker 3: Jenny Bui look further down the table you can see again the customer break even rate for the first six months 2022 and that amount to be a $13,805 per visit per day compared to $38 per visit today for the first half

Perfect.

Finally, the table you can see again, the cash flow breakeven rate for the first six months with strength training tool.

And that amount would be.

Powering <unk> country and $5 per vessel per day compared to 96.

Fixed from $38 per vessel per day for the first half of 'twenty, one the difference again, mostly across the economy.

Speaker 3: The difference again is mostly being accounted by the prior loan repayments during this year. This one was a slight 90.

By the fire in longer payments during this year.

Next I'll move to slide 19.

These slides provide to our shareholders and investors.

Speaker 3: and be a tool to assess the earnings potential for our fleet in the coming.

To access the earnings potential of our fleet in the coming years.

Speaker 3: The table shown here, we call it the data calculator, and we call it the data calculator.

David Sean here quality EBITDA calculator surgical products.

Speaker 3: In the first part, we search for current contracts in place.

First.

Refer to our current quarter excuse me.

Speaker 3: Starting the calendar vessel dates available, the fleet shows the available fleet days and after making some assumptions for dates budgeted for any scheduled dates.

Starting with our colored our investment data available.

We chose the available fleet days.

After after making some assumptions for days budgeted for any scheduled targets.

Speaker 3: Also, it shows the number of conducted days, as a percent, conducted days, the percent coverage, and the average conducted rate in each period. was completed innd February 2021..

Also it shows the number of contracted days.

For Banco de <unk>.

Congress and the Avalanche one block trade in each period.

Are you, making an assumption for the operation.

Expenses and G&A.

Speaker 3: expenses and other GNA expenses and the direct working costs, we can estimate the EBITDA contribution of the contracted portion of our...

G&A expenses.

Of course, we can estimate the EBITDA contribution of the contracted portion of property.

The second part of the table.

Speaker 3: In the second part of the table, and for future period, we can see the difference of the available days and the conducted days, what we call the remaining open days.

And for future period, we can see the difference.

The available data and the contractor base.

Importantly, the remaining open days for policy.

Complete that we'll be back our explanation for the entire fleet, we need to make an assumption about the average rate that we'd be earned by our open days.

Speaker 3: To complete our beta calculations for this task, we need to make an assumption about the average rate that will be earned by our op-ed.

Speaker 3: Here one could make his or her own assumptions. Indicatively

One could make huge assumptions b category.

Speaker 3: were assumed as the open days in the second part of 2022.

We're assuming that the open days in the second property is granted.

2023, and <unk> before we're back at the same rate as the average of the car and the contractual date you can see you can get to the estimates of EBITDA that we see at the bottom of it David.

Speaker 3: 2023 and 2024, will turn the same rate as the average of the car in the contractor days. You can see, you can get the estimates of the damage we see at the bottom of the table.

Speaker 3: Furthermore, knowing our open gate in each period, we can easily calculate the sensitivity of our EPDI estimates to chart the rate changes. The note below the tape

Probably more moving our open days in each period.

You can calculate the sensitivity.

He makes to charter rate changes.

The notes below the table provides.

Speaker 3: sensitivity of our disaster sharp changes. For example, if our 2023 open days are assumed to earn $20,000 per day instead of 33,218 shown on the table, our disaster for the year would be approximately $143,000.

Strategic Youre, probably without the sharp turns teams for example, if our 2023 open days are assured guaranty.

$20000 per day.

Three horizontal campaign theme song this evening.

Okay.

The year would be approximately 543 million.

Let's now move to slide <unk> to review our debt profile.

On the top of the slide.

Speaker 3: On the top of the slide, you can see our scheduled carbon debt repayments over the next several years.

You can see our scheduled debt.

And payments over the next several years.

Speaker 3: Our loan repayment schedule without volumes for this year stands at about 27.4 million with our debt repayment of the current debt going down over the next couple of years.

Our long entertainment schedule to move out volumes for this year.

It's about $27 4 million.

Victor payments of the card debt going down over the next couple of years.

You gave a number of bundling payments coming due in 'twenty, two 'twenty, three which we expect to see the ATM.

Speaker 3: We have a number of body payments coming through in 2023, which we expect to routinely be able to sign up Was subscription policy.

If we choose to do so.

He's not with us.

Speaker 3: Please note that our debt profile does not include any new debt that we expect to assume to sign up our new building.

Clarify does not include any new debt, but can we expect for assume to finance, our new building program.

It could be up on the fly in the slides about the cost of our debt.

Speaker 3: a quick look on this slide about the cost of our debt which is related to the laws of spending at the end of the last quarter.

Related to the launch of our spending.

And last quarter.

Speaker 3: The average margin for death is about 3% and assuming the library of around 2.8%, our cost of human death would be another about 5.8%.

The argument is marching forward debt is about 3% and assuming a LIBOR rate of two.

Two 8%.

Our cost of senior debt would be on average about five 8%.

Before I move to the fourth of our interest rate swaps, which are on average about one 7%. They are callable debt is coming down a bit.

Speaker 3: If one includes the cost of our interface swaps, which are an average of about 1.7%, the overall cost of our debt is coming down a bit to about 4.7%.

Four 7%.

We came out of the bottle mortgage table, we can see our cash flow breakeven level of expectation for the next 12 months.

Speaker 3: Looking out of the bottom of this table, we can see our cash flow, break even level expectation for the next 12 months in dollars per vessel per day.

<unk> per day.

Speaker 3: We can see the valid components that make up our custom operations level.

Keep the wireless component makeup of our customer breakeven level.

Okay.

Adjusted view.

Speaker 3: And the final break-even rate for the next 12 months was expected to be a little less than $14,000, which is $50,990.

The final breakeven rate for the next 12 months, we expect it to be and even less important bullet of 15995.

Speaker 3: weeks about $4227 the rest of the day is a contribution from Live

A week and power for example.

And the second one was the reference today is the contribution from loan repayments.

When I'm looking at this presentation, let's now move to slide 21 to provide some highlights from our balance sheet.

Speaker 3: When you're looking at this presentation, let's now move the slides to anyone to provide some highlights and more balance.

Speaker 3: As of June 30th, 2022, our assets include cash and other assets amounting to about 17.1 million, advances for our new buildings of about 37.8 million, and of course the book value for vessels of about 233.6 million, resulting in book value for our assets of about 28.5 million.

And so in.

So far we've granted to our roster to include costs and other assets amounting to about $17 1 million.

Advances for our new buildings with about $37 8 million and of course, the book value of our vessels for about $233 6 million.

Developing.

Book value for our assets will prove out to converting 88 5 million.

On the liability side.

Our debt as of June 30th liquidity pool stood.

Speaker 3: Our data shows June 30th, 2022 stood at $105.2 million, representing about 36.5% of the book value of our assets.

105, $5 2 million, representing about 36, 5% over the book value of our assets.

Speaker 3: We have on our liability side to report the value of our recently acquired below market shoppers which was estimated in order to record the risk and vessel acquisitions of their fair value.

We have on our liability side, we recorded the value of our recently acquired below market charters, which was estimated in order to record the Houston restaurant acquisition and their fair value.

Speaker 3: 42.7 million or 14.8% of our assets. And other liabilities amounting to about 7.4 million or 25% of our total assets, resulting in about 133 million book value across several different properties.

$42 7 million.

14, 8% of our assets.

Other liabilities amounting to about $7 4 million or if we're going to prosper Santa Clara.

<unk>, resulting in about $133 million book value of our share for infrastructure.

Speaker 3: However, the market value for a fleet is much higher than its book value. Based on...

However, the market value for our fleet is much higher the Haynesville play.

Based on.

Our own estimations.

Speaker 3: using the shorter adjusted market value for vessels in your building contract.

Using the chart on a graph with market volume for our vessels and new building contracts.

Speaker 3: Our vessels are estimated to be worth about 538 million as of the end of June of 2022, which translates to a net asset value of 439 million or about $66 per set.

Our vessels.

Whoa are estimated to be more about 538 million.

As of June 22.

Which translates into net asset value.

<unk> hundred $39 million or about $66 per share.

Recently, our share should be crazy in Voorhees between 20 to 80 to $89 per share.

Speaker 3: Recently, our shares have been trading in the range between $22 and $29 per share, thus representing a significant discount to our net asset value and offering good appreciation potential for our shareholders and good investment opportunities for our lenders.

<unk>.

Some discount to our net asset value.

In lottery group appreciation potential for our shareholders.

Investment opportunities for our investors.

Speaker 3: And with that, I would like to close my presentation and pass the floor back to our attendees continue to discuss.

And with that I would like to close.

All of my presentation and profit from our reservoirs.

Joining the discussion.

Speaker 2: Thank you, Tasso. May I now open up the floor for any questions you may have.

Thank you Tasha.

Now, we'll open up the floor for any questions you may have thank you.

Speaker 1: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. One moment, please.

Thank you we will now be conducting a question and answer session.

I'd like to ask a question. Please press star one on your telephone keypad.

Confirmation Tom on the Kate Your line is in the question queue.

Press Star two if you would like to remove your question from the queue for participants using speaker equipment and may be necessary to pick up your handset before pressing the star Q1.

One moment, please while we poll for questions.

Okay.

Speaker 1: Thank you. Our first question is from Kate Sullivan with Maxim Group. Please proceed with your question.

Thank you. Our first question is from Tate Sullivan with Maxim Group. Please proceed with your question.

Hello, Hi, Thank you good day.

Speaker 1: So thank you. Good day and with your comments about no scrapping this year, but then with the rates, the potential for rates to decline meaningfully in 23.

Hey.

With your comments about it.

Scrapping next year, but then with the rate the potential for rates to decline meaningfully in 'twenty three.

Speaker 1: and then taking delivery of nine new builds over the next three years, two and a half years, what's the balance you look for? When would you decide to start to scrap some of your older ships? We have to see rates decline for those ships to below break even levels or would you look for some other factors.

And then taking delivery of nine new build over the next three years, two and a half years, what what's the balance you look for when would you decide to start to scrap some of your older ships. So we have to see rates decline for those ships to below breakeven levels are or would you look to FERC for.

Or some other factor.

Please.

Speaker 2: Of course, everything will depend on how the market develops, right? So we're not taking any decision now about what we're going to do in 2024 when essentially most of these chapters end. We've got a couple of years left for most of the ships.

Thanks.

So everything will depend on how the market develops right.

So we're not taking any decision now about what we're going to do in 2024, when the essentially most of these jobs.

And we've got a couple of years left a for most of the ships.

Speaker 2: which are under employment. So we will take the decision much closer to the time. If at that time the market is terrible, then probably we will scratch them. If the market is still holding well and the ships are worth passing the next survey and can still contribute, we will keep them. It's a decision for the future, not for now.

Which are under employment. So we will take the decision much closer to the time you put that time the market is David Blue then probably we will just get out some.

If the market is still holding well.

Ships are worth.

<unk>. The next survey and can still contribute we will keep them.

Susan for the future not for now.

Okay. Thank you and then with your comment on the new builds and three year rates well in general in the market three year rates no longer available currently but.

Speaker 1: Thank you. And then with you comment on the new builds and three year rates, well, in general in the market, three year rates, no longer available currently, but I mean, are you still trying to go into target potentially one or two year rates or, or even shorter based on, but it will just depend on how severe the decline is in 23 for the new build.

Are you still try going to target potentially one or two year rates are or even shorter based on both just depend on how severe the decline is at 23.

Build contracts.

Okay.

Speaker 2: Again, this is not a decision that I think will be taken this year except if we see a sudden strengthening in interest and in demand for longer term chapters. We would prefer to fix longer term but we've got a lot of time to wait till then because the next, the third vessel to be delivered to us.

Again this is not a decision that I think will be taken this.

This year, except if we see southern strength, sending an internal spending demand for longer term charters.

We would prefer to fix longer term, but we've got a lot of time to wait then because the next the third of the vessels to be delivered to US only comes in.

Speaker 2: only comes in the third or fourth quarter of 2023, fourth quarter actually. So we've got more than a year's time till that sheet delivers and we will wait and see.

The third the fourth quarter of 2023 full tools that actually so we've got more than a year's time that she delivers.

And we will wait and see.

Okay.

So assuming.

Even if there is a decline if you look at the market.

Speaker 3: Even if there is a decline, if you look at the market terms, rupture of chart rates, you can see that there is a decline If you look at just these numbers, the

Actual charter rate you can see that there is a decline assumed there.

Speaker 3: the levels are way above what our new buildings would have as great even and would be significantly profitable anyway.

The level.

Oh yeah.

What are we building whichever is breakeven would be significantly profitable anyway.

Yeah, Yeah, Great point and that's helpful. Just a quick one on the capital ratio based on the NAV.

Speaker 1: But yeah, great point. And also just a quick one on the capital ratio based on the NAV. I mean, are you still on a fully delivered basis potentially? I mean, with your NAV ratio below capital ratio below 20%, based on a fully delivered basis, are you targeting 30 to 35%?

Are you still on a fully delivered basis potentially I mean, whats your NAV ratio below capital ratio below 20% based on.

A fully delivered basis basis, so you're targeting 35, 30% to 35% cap.

Capital ratios.

Thank you.

Speaker 3: I think we, you mean the leverage ratio, right? The new buildings we intend to finance on the order of 50 to 60% of their contract price as a base and we see what other options we get. So if you blend the current leverage which is below 20% on the base of market values and the let's say 60% leverage of the new buildings, we will be I think comfortably below 40% of the let's say.

You mean.

Right.

Yes.

New buildings, we intend to finance.

The order of 50% to 60% of their contract price.

As a base and we'll see what other options we get so if you blend the current level, which is below 20% on the pace of market values.

Let's say, 60% leverage of the new buildings, we will be I think comfortably below 40% of our leverage.

Even assuming some decline requirement.

Speaker 3: you can assume some decline of one or aging of the vessels.

Aging of the vessels.

Okay. Thank you. Thank you both.

Thanks, Dave.

Thank you. Our next question is from co Frat with Alliance Global Partners. Please proceed with your question.

Speaker 1: Thank you. Our next question is from Poe Fratt with Alliance Global Partners. Please proceed with your...

Good afternoon.

Speaker 4: Good afternoon, Eric. Good afternoon. Toss us several questions. 1st of which is a housekeeping item. It looks like over the last 2 quarters, your commission rates have dropped into the 3 and a half percent range from closer to 100 basis points higher.

Eric Good afternoon taxes.

Several questions.

First of which is a housekeeping.

Item.

It looks like over the last two quarters. Your commission rates have dropped into that three 5% range from you know.

Closer to 100 basis points higher.

Speaker 4: Have commission rates declined or is that just something, is something else going on there?

Commission rates declined or is that just something.

Or is something else going on there.

No no.

Speaker 2: No, the commission rates really depend on who the charter is and through which channels we are able to fix them.

Commission rates are really depend on who the child and through which channel we are able to fix them.

Yeah.

Speaker 2: There's been a few fixes with very little commission rate charge which affects the average. But I wouldn't consider this as a norm.

There's been a few fixtures with very little Commission.

<unk> charms, which affects the average.

But I.

I wouldn't consider this.

As you know.

Speaker 3: If you look at the previous that we had on our website, you will see at least in one case, there's an asterisk indicating that the rate is sort of net of commission because the way that deal was developed, we were built the much lower commission rate because it is paid before it reaches out. So we don't recall this and that might really what reduces the average.

If you look at the fleet that we had on our website you will see at least in one case there is enough data, indicating that there he is.

Sort of net of commission because they wake up here was developed.

We where we are.

The.

Much lower commission rate because as we stated before we believe this household we wanted the quantity and that didn't.

What's the end users the op units.

Speaker 4: Okay, yeah, I'm just using 4.5%, so I just wanted to, you know, fine tune that. Then, secondly, if you could talk about, you know, the updated EBITDA calculator on page 19.

Okay, Yeah, I'm, just using four 5% so I just wanted to fine tune that.

Then secondly, if you could talk about you.

You know the updated EBITDA calculator.

Page 19.

Speaker 4: It didn't look like 23 and 24 changed much from the bottom line total EBITDA number.

It didn't look like 23, and 24 changed much from the Bottomline total EBITA number.

Speaker 4: But the EBITDA number versus the first quarter.

But the EBITA number versus the first quarter went down just about almost 7 million Bucks you know what.

Speaker 4: went down just about almost seven million bucks. You know, it looks like, you know, some of that was dry docking expenses. But can you just talk about the changes and

Looks like.

Some of that was dry docking expenses, but can you just talk about the changes in.

Speaker 4: the second quarter EBITDA calculator versus the first quarter EBITDA calculator.

The second quarter, EBITDA calculator versus the first quarter EBITDA calculator.

Speaker 3: Yes, these are meant to be used as tools to put your own assumptions. The assumption that is put on both pages is

Yes.

Our men can be used as tools.

Our own assumption and the assumption this is put on gross sales.

That's to keep the existing contracts in place to avoid maintain actually Stefan.

Speaker 3: thus to repeat the existing contract to trade to avoid making an explicit assumption.

Speaker 3: on the good WA. So if the rate that were achieved were different what was the existing contract that could result in a difference in the EBITDA. Or it could be the other is the dimension and the higher operating cost would be getting this quarter or higher drydock cost or a shift of the drydock from one quarter to another. So those could be reasons that might change the EBITDA on tomorrow.

If you want to put a downgrade so.

Easily.

And we're a key.

Or defer and work towards the existing contract environment could result in a difference in the EBITDA.

It could be the avenues, you mentioned I mean, it's kind of an operation crossroads discounting this quarter.

All higher drydocking cost on a shift of a dry dock for Mark wanted to another so those will be Asia that might change the EBITDA margins.

Speaker 4: Okay, yeah, but it looked like TASOS, the average contracted...

Okay, yeah, but it looked like <unk> stated the average contracted.

Speaker 4: TCE rate went down from 32,000 to

TC rate went down from 32000.

Speaker 4: to about 31,200 is down by about $800.

About 31200 is down by about $800.

Why would that have gone down if it's already contracted.

Speaker 4: Why would that have gone down if it's already contract?

Again, I need to get back to you on that too.

Speaker 3: I need to get back to you on that to get back to you. But really it could be that a certain vessel that had the gyro which was shifted and changed the average or something like that. I need to get back to you on that.

Okay.

But yeah clearly is that the certain vessels.

As a guide dog food was shifted and changed the outlook to something like that I need to get back to you on that one.

Speaker 4: OK, yeah, because it didn't look like the 2023 dry docking, nor the 2024 dry docking estimates changed at all. So you know,

Okay. Yeah. It didn't look like the 2023 died dry docking nor the 24 dry docking estimates changed at all so.

Just nitpicky, but just wanted to check that out then if you look on page 20.

Speaker 4: just nitpicky, but just wanted to check that out. Then if you look on page 20, then your dry docking expenses are up over the next 12 months so your interest expenses, so your break evens up about $750 on a pre-dead air immunization schedule. Other than what you've already talked about, is there anything else going on as far as pushing those numbers up?

Your your dry docking expenses are up over the next 12 months. So your interest expenses. So your breakeven is up about $750 on a.

Pre debt amortization.

Schedule.

What I've ever been what you've already talked about is there anything that anything else going on as far as pushing those numbers up.

Speaker 3: I mean, I don't know who's not. Is there. Yeah.

You mean higher.

But there is one.

Yeah.

They either dry docking or the interest expense interest expense seems to be going up.

Speaker 4: The either dry docking or the interest expense interest expense seems to be going up, you know, pretty materially relative to the last quarter and.

Pretty materially relative to last quarter and.

Speaker 4: You know, your debt expense or debt load shouldn't have gone up that much. And you're, you know, your capital structure hasn't, shouldn't change much over the next 12 months. So, just trying to figure out, you know, why that would be up, you know, $380 relative to the first quarter.

You know it.

Your <unk> expenses.

Get loud shouldn't have gone up that much in your capital structure hasn't shouldn't change much over the next 12 months. So I was just trying to figure out why that would be up 380 bucks relative to the first quarter.

Speaker 3: A LIBOR rate were higher, obviously, recently, so that contributed to some extent. Secondly, the interest expense, it might include an assumed bet that we might take on a couple of time and come back vessels. So that might reflect a debt level that is about 20% higher.

And LIBOR rates were high year over year.

Mutual of off completely.

To some extent secondly, the interest expense.

<unk> moved.

And assume that we might take on carbon funding from both vessels. So back to my inflect a debt level that is about.

About 20% higher.

Speaker 3: And already over the next two years, over the next four quarters, we will have at least a quarter of a new building.

And <unk> over the next few years, but over the next three or four quarters, we will at.

At least a quarter of a new building.

Delivered so that would be a debt interest on that debt as well.

Speaker 3: Deliver so that would be that interest on that death as well

Okay, and then can you sort of talked about that you know the.

Speaker 4: Okay, and then can you sort of talked about the, you know, the. Contracting environment right now, you know, more on the new builds. It seemed like more versus the existing fleet. Can you just talk about some of the upcoming fixtures that you're looking at? You know, whether it's the knock knock and not a bridge or the hydro or others that are coming up over the next 6 to 9 months. It's not in any mind that we, in reality, you know the pandemic, we out of place for over 2 years, and I guess we're getting really bad conditions, so the the situation is actually going to be that with the pandemic, you know, the low level of bott depletion and kind of

Contracting environment right now.

You know more on the Newbuild it seemed like more versus the existing fleet can you just talk about some of the upcoming fixed curious that you're looking at.

Whether it's been not I cannot a bridge or the hydro or others that are coming up over the next six to nine months.

Okay.

Thanks Chuck.

Yes.

Speaker 2: Yes, we're not discussing currently any potential charter for the next vessels. We are having some preliminary discussions on the Atinada and what its future will be, but really nothing to report yet.

We are not discussing currently any potential shocks.

For the next the vessels we are having some.

Preliminary discussions on the <unk> denied.

And what the future will be but really nothing to report yet.

Speaker 3: Okay, so we have four months.

Okay.

So we are four months before.

Speaker 3: before that and the next one is I believe, Joanna, which opens sometime in January of 2023. So those are the two.

The next one which I believe jamnagar chopping sometime in January .

Great.

Yeah, So I'll start with two.

Vessels that we might be looking over the next quarter.

Okay sounds good and then could you talk about the stock buyback program and just the cadence.

Speaker 4: Okay, sounds good. And then can you talk about the stock buyback program and just the cadence and whether, it seems it's good to see the stock buyback, but I'm surprised that the amount wasn't a little bit larger given the context of where the stock was. Can you just talk about sort of the cadence on that $20 million program and there's a lot left.

Weather.

You know it seems.

It's good to see the stock buyback, but you know I'm surprised at the amount was it a little bit larger given the context of where the stock was can you just talk about sort of the cadence on you.

That $20 million program and Theres a lot locked in.

Just any color you can give us on the stock buyback program would be helpful.

Speaker 4: any color you can give us on the stock buyback program would be helpful.

Sure.

Speaker 2: Sure, the issue is that you cannot use the stock buyback program during a period, a quiet period.

The issue is that.

You cannot use.

The stock buyback.

During a period a quiet period.

Speaker 2: So the last month and a half when the stock was really depressed.

So the last month and a half when the stock was really depressed.

Speaker 2: We could not use it because of this constraint.

We could not use it because of.

All of this constrained therefore, we didn't have the opportunity to implement more which we would have done.

Speaker 2: Therefore, we didn't have the opportunity to implement more, which we would have done at the levels that you saw that we bought the one million worth of stock that we did. Great, that's helpful. Stop using the program around here.

You know the levels that are you sure that when we bought the 1 million worth of stopes that we did.

Great that's helpful.

We stopped using the program like that.

July 10th Great.

Thanks for your time.

Thank you Paul.

Speaker 1: Thank you. Our next question is from James Jang with Univest Securities. Please proceed with your question.

Thank you. Our next question is from James Jang with Universal Securities. Please proceed with your question.

Good afternoon guys.

Speaker 2: Hi, Danes. Nice to hear you. Yeah, it's been a while. I'm glad everything's going well for you guys. Just a couple of quick questions here.

Hi, James it's nice to hear you.

It's been a while and I'm glad I was going to go well for you guys. Just a couple of quick questions for.

Speaker 5: I probably know the answer to this, but I do have to ask, since you have three new builds coming in in 23, and you've got the two, the Akonada and the Joanna coming off charter this year, would you look to possibly sell those vessels?

I, probably know the answer to this but I do have to ask since you have three new builds coming in 'twenty, three and you've got a the two that I can neither in the Joanna coming off charter. This year would you look to possibly sell those vessels.

Speaker 5: after the charters are completed since rates are pretty strong and 23 could be a little more challenging for long-term rates and and charters

After the charters are completed since rates are pretty strong and 23 could be a little more challenging for long term rates.

And in charters.

It's a it's always a E under consideration at Qingdao to mind. So we are we are confused about that a possible path as well.

Speaker 2: It's always under consideration. It's in our minds. So we are conscious about that possible path as well. So we're looking at that too, but amongst the options of winding, amongst the option of chartering, whether it's detillet or not det breaking. Well, I'd say that, or Kingdomacs theory guys are, are completely okay with doing that. I mean, it changes a lot many times in the Mahn embeds space in our Mode. Um, I actually do have time for questions. I'd say for the blended testing Continuing, going into this will probably be at least one of the first

So we are looking at that too.

Two but.

Most of you know the all the options.

Amongst the option of chartering.

It's continued it's monitored continuously.

Speaker 2: continued is monitored continuously.

Okay.

Speaker 5: Okay. Um, and with the dividend, uh, you know, just, it looks like with the contracted vessels, um,

And with the dividend.

Just it looks like with the contracted vessels.

Speaker 5: Even though, let's say, it'll be hard to contract out the vessels that are coming off through the first half of 23. Would you say the dividend is safe? That's a piece of...

Even though let's say it'll be hard to contract out the vessels that are coming off.

Through the first half of 'twenty two it would you say the dividend is.

I think besides.

The dividend.

Speaker 2: The dividend, we decided to do, repeat the previous dividend. We consider the yield that is made on the stock quite satisfactory.

We decided to do repeat the previous dividend and we consider that the deals that are made on this bulk are quite satisfactory.

Speaker 2: And we will see next quarter what we will do and if it will remain the same. But the main assumption is that it remains the same until it's changed. We did an institute, an institute of dividends only to take it away in a couple of quarters. So I think although a lot depends on the market and of course our board may decide anytime differently, as our team has mentioned the underlying belief is that...

And.

We will let's see next quoted are what we will do and they will remain the same but.

The main assumption is the remainder of this is that it remains the same until it's changed when you can institute.

The decrease in wanting to take it away in a couple of quarters. So I think although a lot of attention in the market and of course, our board may decide to anytime differently there.

As mentioned will be the underlying Karen b piece of it would be here for a while.

Okay excellent.

Speaker 5: Okay, excellent. And just on an operational front, the Okinawa and the Joanna, when they come off charter, where will they be positioned? Will they be in the Pacific, the Atlantic? I think the

Hum.

And just.

Just on the operational front.

The I cannot enter Joanna when they come off charter.

Where will they be position would they be in the Pacific The Atlantic.

I think they are both in the Pacific.

Speaker 2: But I don't think that is that important. Charter rates are quite similar today in the various positions.

But I don't think that that's important.

So I have seven eight start quite seamless today and the land use positions.

Speaker 5: Okay. So have you seen any big discrepancies between, you know, charter rates between the two halves, Pacific or Atlantic? Or is it just because the market's strong right now? It doesn't matter. And there's no real repositioning fees or anything else.

Okay.

So any have.

Have you seen any big discrepancies between you know charter rates between the two halves specific or Atlanta or is it just because the market is strong right now it doesn't matter and theres, no real repositioning fees or anything else.

Yes, I would say that at this point there isn't any real big.

Speaker 2: Yes, I would say that at this point, there isn't any real big differences. All right, excellent. All right, well, those are all the questions I have.

Big differences.

Alright excellent.

All the questions I had thank you guys.

Thanks James.

Speaker 1: Thank you. There are no further questions at this time. I'd like to turn the floor back over to Mr. Aristides Pizos for a closing comment.

Thank you there are no further questions at this time I'd like to turn the floor back over to Mr. Aristides Pizza for closing comments.

Speaker 2: Thank you all for standing with us and listening to our presentation today. And we'll be with you in three months time for the next quarter's results. Thank you.

Thank you all for standing with us and listening to our presentation today and will be with you in three months time for the next quarters results. Thank you.

Okay.

Thank you. This concludes today's conference you may disconnect. Your lines at this time. Thank you for your participation.

Speaker 1: Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

Yeah.

Okay.

Okay.

Okay.