Q3 2023 Star Bulk Carriers Corp Earnings Call
Speaker 1: Thank you for standing by ladies and gentlemen and welcome to the StarBulk Carriers Conference call on the third quarter 2023 financial results.
Thank you for standby, ladies and gentlemen, and welcome to the Star bulk carriers conference call on the third quarter to what age 43 financial results.
We have with US Mr. Petros Pappas, Chief Executive Officer Mr.
Mr. Hamish Norton President.
Mr. Cmos sphere room, Mr. Christos <unk> co chief financial officers, Mr. Nikos rest gross chief operating officer, and Mrs. Harris Lockouts, Iraqi Chief strategy Officer of the company.
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 point if you wish to ask your question. Please press star one on your telephone keypad and wait for your name to be announced I must advise you that this conference is being recorded today.
We now pass the floor to one of your speakers today. Mr. Shapiro. Please go ahead.
Speaker 2: Thank you operator, I am Simos Piru, Co-Chief Financial Officer of Starbuck Carriers and I would like to welcome you to our conference call.
Thank you operator, I'm C must be two co chief financial Officer of Star bulk carriers and I would like to welcome you to our conference call.
Speaker 2: for our financial results for the third quarter of 2023.
Our financial results for the third quarter of 2023.
Speaker 2: Before we begin, I kindly ask you to take a moment to read the Safe Harbor Statement on slide number 2 of our presentation.
Before we begin.
I kindly ask you to take a moment to read the safe Harbor statement on slide number two of our presentation.
Yes.
Speaker 2: In today's presentation, we will go through our Q3 results, financing and share buybacks, an update on fleets and operations, the latest on the ESG front and our views on industry fundamentals before opening up for questions.
In today's presentation, we will go through our Q3 results financings in share buybacks and update on fleet and operations. The latest on the ESG front and our views on industry fundamentals before opening up the call for questions.
Speaker 2: Let us now turn to slide number 3 of the presentation for a summary of our third quarter 2023 highlights.
Let's now turn to slide number three of the presentation for a summary of our second quarter 'twenty to 'twenty three highlights.
Speaker 2: Net income for the third quarter amounted to $44 million or $0.46 per share, an adjusted net income of $33 million or $0.34 adjusted earnings per share.
Net income for the third quarter amounted to 44 million or 46 cents per share and adjusted net income of 33 million or 34.
Adjusted earnings per share.
Speaker 2: Adjusted EBITDA was 84 million for the quarter.
Adjusted EBITDA was $84 million for the quarter.
Speaker 2: For the third quarter, as per our existing dividend policy, we declare the dividend per share of 22 cents, with record date as of December 5, 2023.
For the third quarter I spend our existing dividend policy, we declared the dividend per share of 22 cents with record date as of December 2023.
Speaker 2: Since 2021, dividend distributions and share buybacks exceed $1 billion or $10.7 per share.
Since 2021 dividend distributions and share buybacks exceed $1 billion or 10, four and $7 per share.
Speaker 2: Our total cash today stands at $268 million, pro forma for the delivery of our four remaining sold vessels, and share buyback from auction.
Our total cash today stands at 268 million pro forma for the delivery of our four remaining sold vessels and share buyback from all three.
Speaker 2: Meanwhile, our total debt stands at approximately 1.26 billion.
Meanwhile, our total debt stands at approximately 126 billion.
Speaker 2: On the top right of the page you will see our daily figures per vessel for the quarter.
On the top right of the page you can see our daily figures per vessel for the quarter.
Speaker 2: Our time charter equivalent rate was $15,068 per vessel per day.
Our time charter equivalent rate was $15068 per vessel per day.
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Our combined daily operating expenses and net cash G&A expenses per vessel per day.
Bounded two $4851.
Speaker 2: Therefore, our TCE, less OPEX, less GNA, is approximately 9,200 per day per vessel.
Therefore, our TCE less opex less G&A is approximately 9200 per day per vessel.
Speaker 2: Looking towards fleet renewal, we have agreed to sell five of our vessels with an average age of 15.6 years.
Looking towards fleet renewal, we have agreed to sell five of our vessels. We have now been I'd say age of 15 six years.
Speaker 2: During the nine months of 2023, we have sold 12 vessels and received insurance proceeds from one vessel which had a combined average age of 12.4 years. Total gross proceeds from these sales were $272.5 million.
During the nine months of 'twenty to 'twenty three we have sold 12 vessels and received insurance proceeds from one vessel, which had a combined average age of $12. Four years total gross proceeds from these sales were $272 5 million.
These additional costs has been used for share buyback at the discount to NAV.
Speaker 2: This additional cash has been used for share buyback at a discount to NAV.
Speaker 2: On October 2023, we entered into two firm and two optional shipbuilding contracts for the construction of up to four 82,000 deadweight tonne Kamsermax New Buildings vessels, with delivery dates in Q4 2025 and Q2-Q3 2026.
On October 2023, we entered into two firm and two optional shipbuilding contracts for the construction of up to 482000 deadweight ton comes on <unk>, new buildings vessels with delivery dates in Q4 'twenty to 'twenty five in Q2 Q3 2026.
Speaker 2: Slide 4 illustrates a summary of the recently announced strategic repurchase that was agreed with Oaktree Capital.
Slide four illustrates a summary of the recently announced strategic repurchase that was agreed we felt through capital.
Speaker 2: We believe we have utilized a variety of tools to drive shareholder value and we expect these transactions to be accretive to NAV per share, EPS and DPS.
We believe we have utilized a variety of tools to drive shareholder value and we expect these transactions to be accretive to NAV per share EPS and dps.
Speaker 2: As of today, we have agreed to repurchase 20 million shares at an average price of $19 per share from affiliates of Oak Tree Capital.
As of today, we have agreed to repurchase 20 million shares at an average price of $19 per share from affiliates of <unk> of Oaktree capital.
Speaker 2: Given that the shares repurchased have been mostly financed by vessel sales at attractive prices, we are creating significant shareholder value as the implied NAV from these historical sales is higher than current NAV.
Even though the shares repurchased have been mostly financed by vessel sales at attractive prices, we are creating significant shareholder value as the implied it may be from this historical sales is higher than current than a V.
Speaker 2: During this quarter, we have issued and sold 678,282 common shares under our effective ATM offering program at an average price of $19.81 per share, resulting in gross proceeds of $13.43 million and locking a favorable arbitrage.
During this quarter, we have issued and sold 678282 common shares under our effective ATM offering program at an average price of $19 81 per share, resulting in gross proceeds of $13.
$43 million and locking in favorable arbitrage.
Speaker 2: As of the date of this release, we have 93,861,792 shares outstanding, or 83,861,792 as adjusted for the closing of the second block repurchased by Oxford.
As of the date of this release, we have 93 million a climate of 61792 shares outstanding or 83 million 861, 792 as adjusted for the closing of the second block that he purchased by.
Oh great.
Speaker 2: At the bottom of the page you will see an illustration of our share repurchase and the sources of financing that allowed us to complete the buyback.
At the bottom of the page you will see an illustration of our share repurchase and the sources of financing that allowed us to complete the buyback.
Speaker 2: I will now pass the floor to our COO Nikos Reskos to talk about our operational performance and update us on our fleet renewal efforts.
I will now pass the floor to our CEO Nicolas would ask Scott to talk about our operational performance and update us on our fleet renewal efforts.
Speaker 2: Thank you, Simo. Please turn to slide five, where we provide an operational update.
Thank you Simone.
Let's turn to slide five we provide an operational update.
Speaker 2: Operating expenses excluding non-recurring expenses was at $4,851 for Q3 2023.
Operating expenses, excluding non recurring expenses was $4851 for Q3 2023.
Speaker 2: Net cash GMA expenses were $1,224 per day for the same period.
Net cash G&A expenses were $1204 per vessel per day for the same period.
Speaker 2: In addition, we continue to raise at the top amongst our listed peers in terms of ridership safety.
In addition, we continue to right at the top amongst our peers in terms of Rideshare safety score.
Speaker 2: Slide 6 provides a fleet update and some guidance around our future dry dock and vessel efficiency upgrade expenses and the relevant total of hire dates.
Slide six provides a fleet update and some guidance around our future drydock and vessel efficiency operating expenses and their relevance total off hire days.
Speaker 2: Our expected dry dock expense for the next quarter in 2024 is estimated at $39.7 million for the dry docking of 33 vessels, with another $8.6 million towards our vessel upgrade capital.
Our expected Drydock expense for the next quarter and in 2024 existing major of $39 7 million for the dry docking of 33 vessels with another $8 6 million towards our vessel upgrade capex.
Speaker 2: In total, we expect to have approximately 1,000 off-hired days for the same period.
In total we expect to have approximately 1000 off hire days for the same period.
Speaker 2: In line with EXI and CII regulations, we'll continue investing in upgrading our fleet with the latest operational technologies available, aimed in improving our fuel consumption and reducing our environmental footprint, further enhancing the commercial attractiveness of the Starbuck fleet.
In line with it.
<unk> C. III regulations will continue investing in upgrading our fleet with the latest operational technologies available aimed in improving our fuel consumption and reducing our environmental footprint further enhancing the commercial attractiveness of the startup fleet.
Speaker 2: Regarding our Energy Saving Devices Program, we have completed and tested retrofits on 26 vessels, with 7 more vessels to be retrofitted by the end of this year.
Regarding our energy saving devices program, we have completed and tested retrofits on 26 vessels with seven more vessels to be retrofitted by the end of this year.
Speaker 2: The above numbers are based on current estimates around dry dock and retrofit planning, residential employment, and yard capacity.
The above numbers are based on current estimates around dry docking retrofit planning vessel employment and yard capacity.
During the second quarter.
Speaker 2: During the third quarter, we have progressed further with on-board testing of carbon capture technology with a capability to retain up to 30% in net CO2 emissions.
During the third quarter will have progressed.
Further with onboard testing of carbon capture technology with a capability to retain up to 30% net <unk> emissions.
Speaker 2: We will continue working on carbon capture technology with our industrial partners, aiming in developing a cost-effective solution which can be selectively retrofitted in the future on vessels of our fleet.
We will continue working on carbon capture technology with our industrial partners aiming in developing a cost effective solution, which can be selectively retrofit it in the future on vessels of our fleet.
Speaker 2: We are actively working on the demand, supply, and bunkering of carbon-neutral fuels, together with safety consideration and vessel design development.
We are actively working on the demand supply and binary of carbon neutral fuels together with safety consideration and vessel design develop.
Please turn to slide seven what kind of an update around our recent new building order.
Speaker 2: Please turn to slide 7 that has an update around the recent new building order.
Speaker 2: We have decided to take further steps towards our CAMSOMAG fleet renewal, having designed and subsequently ordered two latest generation ECO-CAMSOMAG vessels with deliveries in Q4 2025 and Q2 2026, including off-shore.
We have decided to take further steps towards our Comstock fleet renewal, having designed and subsequently ordered to latest generation Echo comes from ex vessels with deliveries in Q4 of 2025 in Q2 2026, including options.
Speaker 2: The vessels are to be built in China to a high specification, fitted with the latest fuel-efficient engine coming into production in 2024, a shaft generator reducing the energy requirements while at sea, and alternative marine power provisions aimed at offering our charters the optionality to connect to a land-based power grid to support the vessel's entire loading and discharging operations.
The vessels are to be built in China to a high specification treated with the latest fuel efficient engine coming into.
Production in 2024.
Our self generated using the energy requirements, while at sea and military Marine power provisions aimed at offering our charterers the optionality to connect to a land based power grid support the vessels anti loading and discharging operations.
Speaker 2: The above measures ensure best-in-class fuel consumptions and emissions.
Both measures ensure best in class fuel consumption and emissions.
Speaker 2: On the sales front, we continue disposing of vessels opportunistically, having agreed to sell five vessels at historically attractive prices, reducing our average fleet age and improving overall fleet efficiency.
On the sales front, we continue disposing of vessels Opportunistically, having agreed to sell five vessels.
Starting from the attractive prices reduced our average fleet age and improving overall fleet efficiency.
Speaker 2: I will now pass the floor to our Chief Strategy Officer, Karis Plakatonakis, for an EHE update.
I will now pass the floor to our Chief strategy Officer, <unk> Nike for an ESG update.
Thank you Nicole.
Speaker 3: Please turn to slide 8, where we highlight our continued leadership on the ESG front.
Let's turn to slide eight we highlight our continued leadership on D C from.
Speaker 3: For a fifth consecutive year, Starbucks has published its annual ESG report, which provides a transparent and comprehensive account of a company's ESG performance, strategy and objectives.
For a sixth consecutive year Starbucks is at least annually.
Which provides a transparent and comprehensive account of the company's ESG performance strategy and objectives.
Speaker 3: The report has been prepared in accordance with the latest 2021 GRI standards and has received limited external assurance from Ernst & Young on specific GRI disclosures and SASB indicators.
The reports have been prepared in accordance with the latest 2002.
91, Cri standards and has received limited extent industrial rents from Ashton yeah. Once they see the right disclosures and they say you see indicators.
Among other key performance indicators.
Speaker 3: We report a reduction of 4.6% in total CO2 equivalent emissions.
Fourth a reduction of four 6% in total fluids rebalance emissions.
Speaker 3: as well as an improved average fleet annual efficiency ratio compared to the previous year as a result of operational and technical
As well as an improved average fleet annual efficiency ratio compared to the previous year as a result of operational and taking the kind of thing.
Speaker 3: The report also discloses the company's COP3 emissions, a first among green-based dry bulk
The report also discloses the company's scope three emissions.
There's a more green space dry bulk shipping.
Sure.
Speaker 3: Having engaged the company's stakeholders, we present an impact analysis towards environment, people, and economy, paving the way for double materiality to be implemented.
Having engaged the company's stake holders represent an impact analyses store environment people and economy paving the way for that reality to be implemented next year.
Speaker 3: Following this development, Starbuck has improved its sustained analytics ESG risk SMART score from 23.2 in 2022 to 21.3 today.
Following these developments star bulk has something.
Some data analytics E sports.
Score from let me see pointing to in 2022 to 21.3 to date.
Speaker 3: achieving the highest score among our U.S. listeners.
Do you think the highest score among our U S leases theaters.
Speaker 3: On the societal front, we have improved the company's employee retention rates following the implementation of well-being and engagement programs.
On the societal trends, we have improved the company's employee retention rates following the implementation of wellbeing and engagement programs.
Speaker 3: and we have contributed to the Union of Greek Shipowners' efforts to support the local communities in Greece which have suffered severe damages from floods.
We have contributed to the union of Greek shipowners efforts to support the local communities in Greece, we have suffered severe damages from floods.
Speaker 3: We continue our active involvement in the development of a narrow dark green corridor between West Australia and East Asia.
We continue our active involvement in the development of a narrow corridor between Western Australia any states yet.
Speaker 3: I will now pass the floor to our CEO , Petros Papas, for a market update and his closing remarks.
I will now pass the floor to our CEO Petros Pappas for a market update and closing remarks.
Thank you harriss.
Speaker 4: Please turn to slide 9 for a brief update of supply.
Please turn to slide nine for a brief update of supply.
Speaker 4: During the first 10 months of 2022, a total of 30.7 million deadweight was delivered and 4.9 million deadweight was sent to demolition for a net fleet growth of 25.8 million deadweight or 2.8% year-to-date and 3% year-over-year.
During the first 10 months of 'twenty to 'twenty two it's total of 37 million deadweight was delivered.
And $4 9 million deadweight was central demolition for a net fleet growth of 25.8 million deadweight or 2.8% year to date, representing a year over year.
Speaker 4: The supply outlook continues to be close to the best we have seen in the recent history of dry bulk shipping, with an order book of 8.1% of the fleet and 29.6 million deadweight firm orders year-to-date.
The supply outlook continues to be close to the best we have seen in the recent history of dry bulk shipping with an order book of eight 1% of the fleet and $29 6 million deadweight firm orders, yes year to date.
Speaker 4: Uncertainty on future propulsion, high shipbuilding costs, and limited shipyard capacity until the end of 2026 have helped keep new orders under control.
Uncertainty on future propulsion, Hi, shipbuilding costs and limited shipyard capacity until the end of 'twenty 'twenty six have helped keeping your orders under control.
Speaker 4: Furthermore, vessels above 20 years of age stand at 8.2% of the fleet, while scrap prices have stabilized at elevated levels and should make demolition of over-aged and fuel-inefficient tonnets an attractive option during seasonal downturns over the next years.
Furthermore, vessels above 20 years of age stands at eight 2% over the fleet, while scrap prices have stabilized at elevated levels and should make demolition of Walgreens and purely an efficient donuts and attractive option during seasonal downturns over the next few years.
Speaker 4: The average steaming speed of the dry bag flip decreased to a new low of 10.95 knots during Q3 as a result of higher bunker costs, lower freight rates and new environmental regulations.
The average steaming speed of the dry bulk fleet decreased to a new low of 10 point 95 knots. During Q3 as a result of higher bunker costs lower freight rates and new environmental regulations, we expect the E X I see I I regulations, the Crazy thing.
Speaker 4: We expect the EEXI-CII regulations to increasingly incentivize slow steaming and help moderate supply over the next years.
He leaves incentivize slow steaming and help moderate supply over the next years.
Speaker 4: Global port congestion adjusted significantly lower during the last two years and inflated supply by approximately 5% with a negative effect on earnings throughout 2023.
Global Port congestion adjusted significantly lower.
The last two years and inflated supply by approximately 5% with a negative effect on earnings throughout 2023.
Speaker 4: Nevertheless, changes in trading patterns and inefficiencies related to the war in Ukraine have normalized congestion slightly above pre-COVID levels during the third quarter and from now on should follow seasonal patterns.
Nevertheless changes in trading patterns and inefficiencies related to the war in Ukraine have normalized congestion slightly above pre COVID-19 levels during the third quarter and from now on should follow seasonal patterns.
Speaker 4: As a result of the above trends, Netflix growth is unlikely to average above 2% per annum during 2024 and 2025.
As a result of the above trends net fleet growth is unlikely to average about 2% per annum. During 'twenty four 'twenty 'twenty, four and 'twenty 'twenty five.
Let's now turn to slide 10 for a brief update of demand.
Speaker 4: Let's now turn to slide 10 for a brief update of demand.
Speaker 4: According to Clarkson's, total drivable trade during 2023 is projected to expand by 4.6% in ton miles.
According to Clarksons total dry bulk trade during 2023 is projected expense by four 6% in ton miles.
Speaker 4: During the first three quarters of 2023, total dry bulk trade volumes increased by 3.1% year-over-year, supported by record coal and minor bulk trade and a recovery of iron ore exports.
During the first three quarters of 2023 total dry bulk trade volumes increased by three 1% year over year supported by record cold and minor bulk trade and a recovery of iron ore exports.
Speaker 4: Despite weak macro sentiment and a struggling property sector, China dry bulk imports have increased by 13.7% during the first nine months.
Despite the weak macro sentiment and they're struggling property sector, China Drybulk imports have increased by 13, 7% during the first nine months.
Speaker 4: On the other hand, imports to the rest of the world have declined by 3.7% as demand was affected by the war in Ukraine.
On the other hand imports through the rest of the world have declined by 3.77% as demand was affected by the war in Ukraine.
Speaker 4: increased food and energy costs, and tightening monetary policy by Western economies in the effort to fight inflation.
Increased food and energy costs, and tightening monetary policy by western economies in the effort to fight inflation.
Speaker 4: During 2024, dry-buck demand is projected to increase by 1.8% in ton-miles, with the IMF forecast for global GDP growth presently standing at 2.9%.
During 2020 for dry bulk demand is projected to increase by one 8% in ton miles with the IMF forecast for global GDP growth presently standing at two 9%.
Speaker 4: A series of government stimulus measures over the last year are expected to support Chinese demand for raw materials during 2024. Moreover, dry bulk demand from the rest of the world, and especially India and the Middle East, is experiencing a recovery.
A series of government stimulus measures over the last year are expected to support Chinese demand for raw materials during 2024.
Wherever dry bulk demand from the rest of the world and especially India and the middle East is experiencing a recovery.
Speaker 4: Iron ore trade is expected to expand by 4.7% during 2023 and to marginally contract by 0.2% in 2024. China Steel production increased by 2.4% year-over-year during the first three quarters, supported by infrastructure projects, manufacturing and strong exports.
Iron ore trade is expected to expand by four 7% during 2023 and two marginally contract by 0.2% in 'twenty to 'twenty four.
Chinese steel production increased by two 4% year over year during the first three quarters supported by infrastructure projects manufacturing and strong exports.
Speaker 4: At the same time, domestic iron ore output contracted by 5.5%, while stockpiles decreased to a three-year low.
Him time domestic iron ore output contracted by five 5%, while stockpiles decreased to a three year low.
Speaker 4: Steel production from the rest of the world declined by 3.8% over the same period, affected by high energy costs and weak steel margins.
Steel production from the rest of the world declined by three 8% over the same period affected by high energy costs and weak steel margins.
Speaker 4: But the noticeable rebound in output is taking place supported by rising steel prices in the Atlantic.
They're not noticeable rebound in output is taking place supported by rising steel prices in Vietnam.
Speaker 4: Coal trade is expected to expand by 6.9% during 2023 and to contract by 0.9% in 2024. Global focus on energy security has inflated coal trade, while the reshuffling of European and Russian trade has benefited tonnemiles. Moreover, the unofficial ban by China on Australian coal has been lifted and is providing support to Cape Size and Panama Express.
Coal trade is expected to expand by six 9% during 2023 and to contract by 0.9% in 'twenty to 'twenty four.
Mobile focus and energy security is inflated gold trade, while the shuffling of European and Russian trade, there's benefit of ton miles morever via an official ban by China or not.
Lillian coal has been lifted and is providing support capesize and panamax vessels.
Speaker 4: During the first nine months of 2023, Chinese imports surged compared to last year, as thermal electricity increased by 6.1 percent, while hydropower contracted and domestic coal production growth was limited to 4.2 percent.
And the first nine months of 2023, Chinese imports shirts compared to last year, it's thermal electricity increased by six 1% whilst hydropower contracted in domestic oil production growth was limited to four.
2%.
Speaker 4: India is emerging as a leading coal importer, as electricity demand is currently outpacing domestic coal production growth, while stocks at power plants stand at very low levels.
India is emerging as a leading coal importer as electricity demand is currently outpacing domestic oil production growth, while it's folks at power plants.
At very low levels.
Speaker 4: Grain and soybean trade is expected to expand by 3.4% during 2023 and 3.6% in 2024. During the first three quarters of the year, grain trade was affected by the decrease of exports from Argentina, the U.S. and Ukraine. Brazil experienced record soybean and corn seasons that have helped fill the gap of crop losses.
Grain and soybean trade is expected to expand by three 4% during 2023 and three 6% in 2024.
During the first three quarters of the year grain trade was affected by the decrease of exports from the.
The U S in Ukraine.
Brazil experienced record soybean and corn seasons doesn't have helped fill the gap.
We're all for losses.
Increasing constraints in Panama Canal crossings.
Likely the benefit on miles during the U S export season this year.
Speaker 4: Grain supply in 2024 is projected to remain high, but the El Nino weather conditions might affect Latin American and Australian crops. Nevertheless, Chinese demand and increased global focus on food security is expected to inflate grain trade over the next years.
Supply in 'twenty 'twenty four is projected to remain high but the El Nino weather conditions might affect Latin American and Australian crops. Nevertheless, Chinese demand and increased global focus on food security is expected to inflate great rate over the next few years.
Minor bulk trade is expected to expand by three 9% during 2003 and three.
8% in 'twenty 'twenty four minor bulk trade has the highest correlation to global GDP.
GDP growth is supported by improving global macroeconomic fundamentals.
Speaker 4: The war in Ukraine and the subsequent sanctions on Russian industries have disrupted the Atlantic fertilizer and steel industry and have created shortages to support backhaul trades. Moreover, expanding West Africa bauxite exports continue to generate strong termites for Cape-sized vessels, with exports up by approximately 30% year-to-date.
The war in Ukraine, and the subsequent sanctions on Russia and industries.
Disrupted the Atlantic fertilizer and steel industry and they have created surfaces. The support backhaul trades morever expand in West Africa bauxite exports.
They used to generate strong demand for capesize vessels with exports up by approximately 30% year to date.
Yeah.
Speaker 4: Finally, outlook for the dry bulk market remains positive due to increasingly favourable supply dynamics, improving macro sentiment and large global infrastructure investment needs for the world's green transition.
Finally outlook for dry bulk market remains positive due to increasingly favorable supply dynamics.
Proving macro sentiment and large global infrastructure investment needs for the worlds.
Speaker 4: Starbucks is well positioned due to its scrubber-fitted and diverse fleet to take advantage of market opportunities and remains focused on actively managing its fleet and continuing to create value for its shareholders.
<unk>.
Star bulk is well positioned due to scrubber fitted and diverse fleet to take advantage of market opportunities and remain focused on actively managing its fleet and continuing to create value for its shareholders.
Without taking any more of your time I will now pass the floor over to the operator for any questions you may have.
Speaker 4: Without taking any more of your time, I will now pass the floor over to the operator for any questions you may have.
Thank you, ladies and gentlemen at this time well be conducting a question and answer session. If.
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Our mission tone will indicate your line is in the question queue you.
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For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star T.
Our first question comes from the line of Amit.
Deutsche Bank. Please proceed with your question.
Speaker 5: Hey, good morning. Good afternoon. This is Chris Robertson on for a minute. Thanks for taking our questions.
Hey, good morning. Good afternoon. This is Chris Robertson on for Matt Thanks for taking our questions.
Right.
Speaker 5: Yeah, guys, just looking at the rates book quarter to date, it looks so far to...
Yeah, guys, just looking at the rates booked quarter to date.
So far to be sequentially stronger than <unk>, but just looking forward for the remainder of the quarter do you think that we'll see a bit of a pull back on normal seasonality or are there any short term factors like an hour congestion or anything else going on that might keep the rate a little bit more robust than usual as we enter into the end of the year.
Speaker 5: stronger than 3Q but just looking forward for the remainder of the quarter do you think that we'll see a bit of a pullback on normal seasonality or are there any short-term factors like canal congestion or anything else going on that might keep the rates a little bit more robust as usual as we enter into the end of the year?
<unk>.
Hi, Chris.
Speaker 4: We think that this Q4 is going to be a normal Q4, better than the rest of the year, as it always has, almost always has been.
We think that this year.
Four is going to be a normal Q4 better than the rest of the year as it always has almost always has been because the second part of the year usually.
Speaker 4: because the second part of the year usually carries about 54% of trade versus the first part. I don't know, I don't think anything will change to that. Also the holidays are coming. We believe that Q4 will be better than the rest of the quarters.
There is about 54% of our trade versus the first part.
No I don't think anything that will change so that also that the holidays are coming up.
We believe that Q4 will be will be better than the rest of the all of the quarters as usual.
Speaker 5: Okay, yeah, I got that. Just looking at the dividend policy moving forward here, is the minimum liquidity threshold going to continue to be calculated off the 128 vessels, or will that be adjusted at some point to reflect the recently concluded and announced vessel sales?
Okay got that.
Looking at the dividend policy moving forward here is the minimum liquidity threshold going to be.
We continue to be calculated off the 128 vessels or will that be adjusted at some point to reflect the recently concluded and announced muscle cells.
Speaker 5: Chris, we have announced today that we have released the $2.1 million for the 13 vessels that have been sold or are committed to be sold. So in reality, the threshold is now 115 remaining vessels times $2.1 million. Got it. That's helpful. Okay. And last question for the panel.
Greece.
Have announced today that we have released the two 1 million for the 13 vessels that have been sold or are committed to be sold so in reality the threshold is now.
115 remaining vessels times $2 1 million.
Got it that's helpful. Okay and last question for me just on the new building vessels.
Speaker 5: looks like they'll be built with conventional but very efficient engines. Are there any design aspects to it that would enable future retrofitting of different technologies? And can you explain a little bit more what AMP is?
It looks like they'll be dealt with conventional but very efficient engines are there any design aspects to it that would enable future retrofitting of a different technologies and can you explain a little bit more what a M. P. S.
Speaker 6: Hi Chris, this is Nikos. Thanks for the question. Well, first of all the ships have been upgraded with the latest engine from MAN BMW that is coming out next year and these are some of the first ships that are ordered with this engine which automatically brings the consumption down compared to other vessels currently built by about two to three tons a day. So that's pretty significant.
Hi, Chris This is Nicholas.
Thank you other questions well first of all the ships have been upgraded with the latest engine for Madden BMW that is coming out next year and these are some of the first ships that are ordered with Ascension. We took him article it brings the consumption down compared to other vessels currently meals by about two to three times a day so.
That's pretty significant.
Speaker 6: AMP is a piece of equipment which allows you to use a real, basically, in port and connect to ports that do have a power grid on dock so that you can shut off generators. You can actually operate the entire vessel using shore power, basically a plug-in facility. We believe that apart from the US, which is already available in certain ports, this is going to be adopted worldwide in the next few years, and we prefer to offer this option to charter.
A&P is.
Piece of equipment, which allows you to use a real basically import and connect to port that do have all agreed on dock side, you've got shut off generate those who can actually operate the entire vessel using sharp power basically a plug in facility. We believe that apart from the U S which is already.
Relevant in certain sports. This is gonna be adopted worldwide in the next few years and we would prefer to offer this option.
The charterers.
Speaker 6: We have made the study for methanol, geofuel methanol. We will wait to see developments on the supply side of green methanol before we make any firm decision to upgrade the vessel.
Got it yeah it sounds good.
Stability well, we have made the slide before our methanol fuel ethanol.
We will wait to see developments on the supply.
Type of Green methanol before we make any firm decision to upgrade their vessels.
Okay.
Speaker 5: Any idea on the Catholics that might be required on that in the future?
Any idea on the capex that might be required on that in the future.
I'm going to walk through this.
Speaker 1: You mean the methanol? Yeah. That's estimated on a council max roughly around five million. Okay, got it. That's helpful. All right, guys, I'll turn it over. Thanks for taking our questions. Thank you.
You mean, the methanol yeah.
Estimated on our comps how much roughly around $5 million.
Okay got it that's helpful. All right guys I'll turn it over thanks for taking my questions.
Thank you.
Our next question comes from the line of Omar <unk> with Jefferies. Please proceed with your question.
Thank you Hey, guys good afternoon.
Good question Omar.
Speaker 7: Hi, yeah, just first question I have is maybe kind of following up on Petros talking about the market a bit and in the fourth quarter being the strongest of the year, obviously, we've seen rates improve and strengthen thus far into the quarter and averages are at their best across the board. I guess, in terms of.
Hi, Yeah. Just first question I have is maybe kind of following up on Petros.
Talking about the market a bit and in the <unk> or the fourth quarter being the strongest of the year, obviously, we've seen rates improve and strengthen thus far into the quarter and averages are at their best across the board.
I guess in terms of.
Speaker 7: you know, this improvement, is this basically just, would you characterize this as purely seasonal, or are there other sort of demand factors or fundamental factors in the background that have caused this to improve according?
This improvement.
Is this basically just would you characterize this as purely seasonal or are there other sort of demand factors of fundamental factors in the background that have caused us to do to.
To improve accordingly.
Speaker 4: Well, you know, during the second part of the year, there is more iron ore trade.
Well you know during the second part of the year are there is more iron ore trades.
Speaker 4: There's more production from Brazil, which also improves ton-miles.
Theres more production.
From from Brazil.
Which also improves our ton miles.
Speaker 4: I think this time around, coal imports in India will also be strong because India has very low stocks.
I think.
This time around coal in coal imports in India will also be strong because India is.
Is has very low stocks.
Speaker 4: And the rest of the trade, bauxite and grains, will continue as usual. So I think iron ore ton miles and coal imports in India will be the major reasons why this market is going to be stronger during Q4.
And the rest of the trade bauxite in grains will continue to as usual, so I think iron ore ton miles and and coal imports in India will be the may the major reasons why this market is going to be stronger during Q4.
Speaker 7: Okay, yeah, just kind of wondering if, if you know, by by seeing this market.
Okay. Yeah, just kind of wondering if you now bye bye see in this market.
Speaker 7: quote unquote strength, not necessarily saying it's strong, but it's definitely much better than it has been. Has that maybe given you a bit more conviction on perhaps next year or the medium term outlook being better or do you not look at this as a shift in that you maybe characterize this as just much more of a seasonal thing and so let's not get too excited. Just want to get maybe kind of how Starbuck in general is viewing this market strength we've seen over the past couple of months.
Quote unquote strength, not necessarily saying, it's strong, but it's definitely much better than it has been and that may be giving you a bit more conviction on perhaps next year or the medium term outlook being better or worse.
Or do you not look at this as a <unk>.
As a ship that you may be characterize this as much more of a seasonal thing and so let's not get too excited just wanted to get maybe kind of how star bulk in general is doing this this market strength, we've seen over the past couple of months.
Speaker 4: Well, my personal opinion is that 2024 is going to be similar to 2020.
Well my personal opinion is that 'twenty 'twenty four is going to be.
Similar.
Two our 2023, unless if there are any geopolitical developments that.
Speaker 4: unless if there are any geopolitical developments that.
Speaker 4: are difficult to foresee. I think that iron ore, for example, will be about the same, mainly because the rest of the world is going to start improving their economies, and also because China has very low stocks.
Our difficult to foresee I I think that iron ore for example.
<unk> will be about the same mainly because the rest of the world is going to start improving their economies and also because shine.
It is very very low stocks.
Speaker 4: On the call front, I think that
On the cold fronts are I think that we may see lesser trade actually.
Speaker 4: We may see lesser trade, actually, to a certain degree, mainly because of...
Certain degree mainly because of.
Speaker 2: the El Nino effect. And of course, the world is trying to reduce coal consumption. I think bauxite to China will improve as every year. And I think that grains are going to be doing better. El Nino is actually positive for grains. So, overall, I would say a similar market, perhaps a bit better.
The El Nino effect and of course, the world is trying to reduce our coal consumption.
I think bauxite to China will will improve.
Well as every year.
And I think that grades are going to be doing better the el Nino is actually positive first Green's. So overall I would say a similar market, perhaps a bit better.
Speaker 7: Okay. Thank you. Thanks for that, Mark and Petra.
Okay. Thank you thanks, thanks for that.
Market color Petra.
And then maybe just kind of a kind of a follow up perhaps of the new buildings Ah Ah Ah.
Speaker 7: Kind of a follow-up, perhaps, to the new buildings, as Chris was asking. You've obviously disposed of the 13 ships this year. You've raised a good amount of capital. Doing so, you used it to buy a big chunk of the oak tree position. I guess, in terms of where Starbuck is today in your market footprint, you're down to, you know, 115 ships, still substantial.
Chris was asking.
You've obviously dispose of the 13 ships. This year you've raised a good amount of capital doing so you used it to buy the big chunk of the Oaktree position I guess in terms of where Starbucks is today in your market footprint Youre down to 115 ships still substantial critical mass, but how do you think about the fleet footprint as it is.
We kind of think about where you're going into into next year you had the cancer Max new buildings that you just announced how.
Speaker 7: Should we be thinking of Starbuck continuing to be a seller in this market of older tonnage and then perhaps replacing them over time with more of these new buildings?
Should we be thinking of Starbucks continuing to be a seller in this market of older tonnage and then perhaps replacing them over time with more of these are new buildings.
Well you know I think we'll we'll do the right with the right commercial thing you know obviously, our fleet is getting older every year and it can't get all the indefinitely.
So we will look at the at the right opportunities to sell ships that are not going to have.
You know a long life and get shifts that will have a long life.
Speaker 1: And, you know, as always, we also continue to look at merger possibilities, and we see, you know,
And you know as as.
As always we also continue to look at merger possibilities in and we see you know.
Speaker 1: We are seeing opportunities all the time. As we've said in the past, these are always hard to close.
We are seeing opportunities all the time and as we've said in the past these are always hard to close.
And just to add to Omar This is Kris those we also have the savings chartered in vessels, which.
Speaker 8: And just to add, don't worry, this is crystals. We also have the seven tartarine vessels.
Speaker 8: which effectively are all young basals and further renew the fleet.
Effectively are.
Our old young basis.
A further renew the fleet.
Speaker 7: Yeah, and of course, those vessels, you know, give us a lot of optionality. Yeah, and they are all delivering this year, right? Yes. Yeah, got it. OK, well, thank you. That's it for me. Thanks, guys.
Yeah and of course that those vessels.
Gave us a lot of Optionality.
Yeah, they're all delivering this year right yes.
Yeah.
Got it okay well. Thank you that's it for me thanks, guys.
Thanks Omar.
Our next question comes from the line of Ben Nolan with Stifel. Please proceed with your question.
Thanks.
In a little bit curious on the new builds.
Speaker 9: You know, obviously you're selling assets, they're historic.
You know, obviously, you're selling assets, there historically, a little bit higher priced and I appreciate the need to replenish the fleet and so forth, but new builds are a bit more expensive than they normally would be too.
Speaker 9: little bit higher priced. And I appreciate the need to replenish the fleet and so forth. The new builds are a bit more expensive than they normally would be too. The view of this is just sort of a necessary evil.
Do you view this as just sort of a necessary evil.
Speaker 9: of paying a little bit of a higher price in order to make sure that your fleet is new or
In terms of paying a little bit of a higher price in order to make sure that your fleet is new or you.
Speaker 9: Do you think maybe we're in a new paradigm where we're just asset prices are higher and the price that you're paying for the new builds is
Do you think maybe we're in a new paradigm, where we're just asset prices are higher and the pricing that you're paying for the newbuild.
Reasonable on that basis.
Well.
Speaker 4: Ben, first of all, we're buying these, these vessels are actually, their speed and consumption is actually similar to that of the best Japanese vessels, and we made sure that this would be the case, otherwise we wouldn't have gone forward.
Been.
First of all we are buying these vessels are actually there.
There's a speed and consumption is actually a similar to that of the best up on these vessels and we made sure that this would be the case, otherwise wouldnt have gone forward.
Speaker 4: And Japanese vessels, similar Japanese vessels, are being sold like $6 or $7 million more expensive than these ones. So we do not consider them that expensive.
And Japanese vessels similar Japanese vessels are being sold like six or $7 million dollars more expensive than this ones. So we do not consider them that's expensive.
Speaker 4: Secondly, vessels like that, that burn like 7-8 tons less fuel than the older camshaft maxes actually save you almost $4,000 a day, a sailing day. So you recoup the differential very, very quickly.
Secondly, the vessels like that that burn like seven eight tons less fuel than the.
The Alder comes from Axis actually save you almost $4000 in the sailing day, So you recoup.
The the differential very very quickly.
Speaker 4: and uh... at the end of the day we do not think that uh...
At the end of the day, we do not think that.
Speaker 4: New building prices are going to go down. There's very little availability right now. And if one so wanted, I'm pretty sure that closer to the day the delivery dates, one could sell these vessels even more expensive.
New building prices is going to go down there is very little availability right now.
<unk>.
If one so wanted I'm pretty sure that closer to the day that delivery dates one could sell these vessels even more expensive.
Speaker 1: And also, since the beginning of the COVID pandemic, U.S. dollar inflation has not been small. It's over 10 percent change in prices. So you have to expect that nominal dollar prices of new buildings will go up.
And also you know since the beginning of the Covid pandemic U S. Dollar inflation has not been small.
Yeah, it's it's over 10% change in prices.
Yeah. So are you you have to expect that.
No. It's a nominal dollar prices at new buildings will go up.
Speaker 4: Plus, we are seeing that decarbonization will probably take longer.
Last year we.
We we are seeing that.
The carbonization will probably take longer.
Speaker 4: than what we initially thought it would, and that will mean that best-in-class vessels will have the chance to trade for a lifetime.
Than what we initially thought it would.
And that will mean that our best in class vessels will will have the chance to ER to ER to trade for a lifetime.
Speaker 9: Yeah, that all makes sense. And then my next question.
Got it.
I know it makes sense and then and then my next question.
Speaker 9: was around the buyback and then also the ATM activity. And I appreciate that you're buying at a lower price than you're selling with respect to the share price. Although again, at least according to my math, the shares are still trading below NAV anyway that you slice it.
It was around the buyback and then also the ATM activity in it and I appreciate that you're buying at a lower price than you're selling with respect to the share price although again.
At least according to my math.
Shares are still trading below NAV anyway, you slice it just curious.
Speaker 9: the thinking maybe behind not just selling a few extra ships.
Thinking maybe behind not just selling a few extra ships in order to help fund the share repurchase versus.
Speaker 9: to help fund the share repurchase versus being active on the ATM below.
Being active on the ATM blowing IV.
Speaker 1: Well, then, you know, basically, you know, if you have a shareholder coming to you and saying, you know, I'm afraid that when Oak Tree sells, the overhang, you know, is keeping your share price down, you know, when Oak Tree sells, the price is going to collapse.
Well then you know they they.
Basically you know if you have a shareholder coming to you and saying you know I'm I'm afraid that when oaktree sells the overhang.
Hey, it is keeping your share price down you know went out for yourselves the price is going to collapse.
Speaker 1: Can you do something about it? And then, you know, we, you know, sell shares at 81 cents above where we buy them in. Obviously, the shareholder is better off. It would have been even better if we could sell more ships at a very high price.
Can you do something about it and then you know we sell shares at 81 cents above where we buy them and obviously the shareholder is better off.
It would have been even better if we could sell more ships at a very high price.
Speaker 1: But, you know, what we did basically was we wanted to buy 20 million shares, and we funded that with debt, equity, and proceeds from ship sales, and we did what we could do in each of those areas, and in each case, we think it was beneficial for the shareholders.
But you know what we did basically was was we wanted to buy 20 million shares and we funded that with debt equity and proceeds from ship sails and we did what we could do in each of those areas and in each case, we think it was beneficial for the shareholders.
Speaker 1: Plus the item was like 3.5% of the buyback. Yeah, but basically we sold the ships we could sell, we issued the equity that we could issue at prices that we knew would be profitable, and we tried to limit the borrowings to the extent we could, but all of it was good for the shareholders, we think.
Right. Okay. The ATM was like three 5% of it over the buyback well, yeah, but basically we followed the ships we could sell we issued the equity that we could issue at prices that we knew would be profitable.
And you know we tried to limit the borrowings to the extent, we could but you know all of it was good for the shareholders we think.
Okay.
Yeah the color there.
Okay.
Okay.
As a reminder, it is star one to ask a question.
Speaker 10: Our next question comes from the line of Nathan Howell with Bank of America.
Our next question comes from the line of Nathan <unk> with Bank of America. Please proceed with your question.
Hey, great.
Speaker 11: Thank you, Tim. I think I would just want to continue a little bit on Ben's train of thought there. And I guess I'll just ask this question a little differently.
Thank you Tim I think I would just want to continue a little bit on a bench.
Ben train of thought there.
And I guess I'll just ask a question on that.
A little a little differently.
You spoke a little bit about buying back shares from Oaktree at a discount to a significant discount to any of your end and what the share issuance and now I think like with the disposal of vessels that all seems to align with the same type of framework.
Speaker 11: and right with the share issuance and now I think like with the disposal of vessels that all seems to align with the same type of framework but now with this new build I'm just kind of curious on how the team is thinking about capital strategy in context of where you're currently seeing your net asset value like how are you deciding what to do with your cash?
But now with this new builds I'm just kind of curious on how the team is thinking about capital strategy in context of where you are currently seeing or net asset value.
How are you deciding what to do with your cash given where your asset values.
Relative to your share price.
Speaker 1: Well, thanks for the question, Nathan. You know, I think we looked at these new buildings, frankly, as being a chance, an opportunity that we would not have the chance to duplicate.
Wow.
Thanks for the question Nathan Yeah, I think.
We looked at these new buildings frankly as being a it.
Chance.
An opportunity that we would not have the chance to duplicate.
Speaker 1: You know, we think these are, this was an exceptional situation where the shipyard wanted us specifically as
Yeah. We we think these are this was an exceptional situation where the shipyard wanted ask specifically as a client and offered US slots that you know, we're not gonna be available anywhere else for a ship that has a quality that we couldnt.
Speaker 1: and offered us slots that were not going to be available anywhere else for a ship that has a quality that we couldn't get, frankly, at other shipyards. They worked with us to put an engine on that isn't available yet, generally, and to put a shaft generator on, and generally tweak their design to our needs. So, you know...
Get frankly at other shipyards.
You know they they worked with us to put an engine on that isn't available yet generally and to put a shaft generator on and generally tweak their design to our needs. So you know.
Speaker 1: We're not, you know, planning to go out and replace our fleet with new buildings, if that's sort of the point of the question. This we thought was, frankly, an opportunity that was too good to let go.
We're not planning to go out and replace our fleet with new buildings, if that's sort of the point of the question. This way we thought was frankly, an opportunity that was too good to let let go.
Speaker 11: Just to follow up on that, for a like-for-like vessel, what would the lead times look like in, say, a Japanese or a Korean vessel?
Got it.
Just to follow up on that for a like for like Russell what would the lead times look at look like in say, a Japanese or Korean yard.
Speaker 6: lead times for Korean yards or Korean or Japanese? Well, basically we are, uh, about a year later. I mean, Japan is presently offering mid, uh, 2027, uh, for vessels and Korea doesn't build bulk carriers because they're occupied with LNG and, uh, container and tanker vessels.
Lead times for Korean yards, or Korean or Japanese well basically we are about a year later I mean, Japan is presently offering made that 2027.
For vessels in Korea doesn't build bulk carriers, because they are occupied with LNG and container tanker vessels.
Speaker 8: And I guess China, there are no slots offered for 2025. You can only find slots for 2026, and those are very few.
And I guess, China there.
There are no no slouch offered for 2025, you can only find slots for 2026 and those are very few.
And not this quality.
Speaker 4: And I think second half 26 actually, not, yeah, as you said, very few.
And I think second half 'twenty six sexually not yeah as you said very few.
Speaker 11: Great. That's helpful. And Hamish, I think you brought up earlier about the possibility of potentially using mergers as another way of renewing.
Okay, that's helpful and Hamish.
Hey, Mitch I think you brought up earlier about the possibility of potentially using mergers as another way of.
Renewing the fleet.
Speaker 11: Maybe, if you wouldn't mind just expanding a little bit about that, what kind of opportunities you're seeing.
Maybe if you wouldn't mind, just expanding a little bit about that and what kind of opportunities you're seeing and.
How youre seeing the market currently.
Speaker 1: Well, yeah, you know, we always see opportunities to, you know, buy fleets and...
Well yeah.
We we always see opportunities to buy fleets.
And.
Speaker 1: Much of the time we see the opportunity to use our shares, you know, we only do these transactions if we can use our shares at or above NAV.
And at the time, we see the opportunity to use our shares now we only do these transactions if we can use our shares at or above in a V.
Speaker 1: And frankly, we're not looking to increase our leverage by any significant amount if we can avoid it. So, you know, we're a bit picky. The sellers, you know, have been, you know, until recently, a bit picky. And it's been hard to get these things done since the COVID pandemic. Although before COVID, we did about eight of them, I think.
And you know frankly, we're not looking to increase our leverage by any significant amount. If we can avoid it. So you know we're a bit picky the salaries have been until recently a bit picky and it's.
<unk> been hard to get these things done since since the Covid pandemic.
Although before Covid, we did about eight of them I think.
Speaker 10: You know, the market seems to be turning around a little bit and may be making it easier to close these transactions. So, you know, I'm hopeful. Great. Thank you so much. That's really helpful. Thank you. Our next question.
The market seems to be turning around a little bit and maybe making it easier to close these these transactions.
So you know I'm hopeful.
Great. Thank you so much that's really helpful.
Thank you.
Our next question comes from the line of Bendig folding.
<unk> with Clarksons <unk> Securities. Please proceed with your question.
Yeah.
Yes. Thank you I think I just wanted to touch a return to the markets and I'll touch upon some of the ESG aspect do.
Speaker 12: Do you see any impact from.
Do you see any.
Impact from from.
Speaker 12: factors such as the carbon intensity indicator or the EU ETS system. Do you see that affecting the driver market going into 2024 and beyond with regards to stuff like slow steaming?
From factors, such as the carbon intensity indicator or the EU ETS system.
Do you see that affecting the drybulk market going into 2024 and beyond.
With regards to <unk>.
Just stuff like slow steaming.
Well, we think that.
Speaker 4: Vessels will probably, among the means to have a better CII,
Vessels will probably among the.
It means to have a better a CIA I.
Speaker 4: I think that vessels will probably also reduce their speed, so I think that this is going to be beneficial because there's going to be basically less supply of vessels.
I think that the vessels will probably also reduced their speed. So I think that this is going to be beneficial.
Because there's going to be basically less supply of vessels.
Speaker 4: So we consider in this company.
So.
We are considering in this company.
Speaker 4: at the environmental regulations as only positive for the shipping industry.
The environmental regulations is only positive for the shipping industry.
Okay.
Speaker 12: Okay, thank you. And just a little technical detail at the end there, the price point for the options, are those the same as for the firmware tools?
Okay. Thank you and just a little technical detail with you at the end there.
The price point for.
The options are those the same score for the firm by school.
Speaker 13: And also, could you elaborate some on what you would expect the financing to look like if you decide to exercise?
And also.
Could you elaborate some on.
What you would expect the financing to look like if it decides to exercise those.
Speaker 1: The option price is exactly the same as the firm vessel, that's the first part. And, you know, we don't have a lot of cash to pay.
The option price is exactly the same as affirmed vessels off the first part.
Yeah.
We don't have a lot of cash due to pay.
Speaker 1: You know, for the near term, it's like $7 million for the two firm vessels and it would be $7 million for the two optional vessels and that holds us for a while. So, you know, we're...
You know for the for the near term, it's it's like 7 million for the two right firm vessels and it would be 7 million for the two optional vessels and and that hold this for a while so.
You know where where Uh huh.
Speaker 1: You know, we can finance it, frankly, with debt, you know, to begin with.
Yeah, we can finance it frankly with with that.
You know to begin with.
Yeah. It is it's not a big deal and then you know.
Speaker 1: It's not a big deal. And then closer to delivery, we'll figure out the best way to finance it from the shareholder's point of view.
Closer to delivery will we'll figure out the best way to finance it from from the shareholders' point of view.
Speaker 1: Just to clarify, this 7 plus 7 million will not affect our cash balance for the distributable cash for dividends? Yeah, exactly. We're not planning to finance these out of operating cash flow.
Just to clarify these seven plus 7 million will not affect our cash.
Cash balance for the distributable cash for dividends, Yeah, Yeah, exactly we're not planning to finance these out of operating cash flow.
Okay.
Yeah.
Speaker 4: There are no further questions in the queue. I'd like to hand the call back to management for closing remarks. No further remarks, operator. Thank you very much.
There are no further questions in the queue I'd like to hand, the call back to management for closing remarks.
No further remarks, operator, thank you very much.
Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation you may disconnect. Your lines at this time and have a wonderful day.
Thank you very much.
Yes.
Yes.