Q3 2023 Costamare Inc Earnings Call

Thank you for standing by ladies and gentlemen, and welcome to the Costumer, Inc. Conference call on the third quarter 2023 financial results, we have with US Mr. Gregory Zika Chief Financial 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 time if you wish to ask a 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 Wednesday November 1st 2023.

We would like to remind you that this conference call contains forward looking statements.

Please take a moment to read slide number two of the presentation, which contains the forward looking statements.

Yeah.

And I will now pass the floor to your speaker today. Mr. Vikas. Please go ahead Sir.

Thank you and good morning, Vincent I live in.

During the third quarter of the year. The company generated net income of about $53 million as of quarter. Andy Wade you were close to one P M.

We think we're gonna chipset to larger ships continue to enjoy a tight market was one of the vessels experienced deteriorating conditions.

But all of the market outlook looks uncertain due to the large order book.

These are patient demolition.

Well the day about a site as part of our strategy to renew the fleet and to increase its average size, we acquired two capesize and two uncles amongst vessel.

At the same time, we dispose of two older Supermac ships.

Our old dry bulk vessels continue to trade on a spot basis was a trading platform has grown to a fleet of 59 vessels.

Haven't invested 200 millions of dry bulk operating platform, we are long term committed to the sector.

My address we view positively.

Regarding and that's what my time listening the plasma and Crosby, instead really growing when you put them basis I have a couple of interesting transaction of course, everybody can see if you can talk on which our company and resident base you have the pipeline extending over the coming quarters.

Finally during the quarter, we continued with our share repurchase program and we booked $10 million worth of common shares highlighting our strong belief that the surprises shepherded undervalued considering both the colborne spent four months in the brokerage.

Moving now to the slide presentation.

On slide three as you can see our third quarter results net income for the quarter was RMB $53 million 45 per share. It doesn't I think it was around 54 million or 46 cents per share I would agree it sounds or else we won't bring those on.

Yeah.

Slide four you can see an update on our share repurchase program since our Q2 earnings release with Barclays brokerage 900000 common shares for $10 million.

In addition, we continue to have a long uninterrupted dividends throughout the airport wasn't very strong sponsor support.

Slide five regarding CPI, we have chartered in 59 periods versus where the majority of the fleet to be an index linked charter agreements.

Oh, no we're losing platform, we have already invested around $74 million.

Since inception, and then manifest findings have been do you guys have sort of saying that this is Mike.

Hey, Bill.

Transactions.

Is it fair to guarantee five nights.

Turning to slide six we have acquired two capesize and Panamax dry bulk vessel why do we have agreed to sell to two panamax Drybulk ships and are these younger recapped on either the sale of a 2000 built containership along with US saying with the same no part of 49% equity interest when another man.

We continue to see pressure.

Slide seven.

During the quarter, if we can find that the acquisition of two dry bulk vessels to an existing pad. The classroom facility why do we have what else is available Congress $44 million towards a partnership with Brexit negotiations, we're continuing to target or that would drive our breakfast is a sports markets, having it does get to more than 50000 agreements since our last earnings release.

Okay Alright.

The days have essentially 100% fixed for this year 87 per cent for granted Florida, and San Fran and Super simple 25, well, while our contracted revenues are people or $7 billion with a weighted remaining time duration of three seven years.

Slide eight our liquidity stands at dropping to run and be a really weird. It gives us the ability to look for opportunities to grow the company or Nickelodeon basis.

Slide nine charter rates like when energy markets have softened mainly for the smaller sizes the landing zone at about three corporate leverage.

Capacity remains at low leverage of one 7%.

On Slide 10, you can see the recent dry bulk market trends this quarter fourth Margaret.

Today's craft drinkers, who still too although remaining watertight. The order book is at eight 1% of the total fleet.

With advocate completes our presentation and we can now take questions. Thank you.

Operator, we can take questions now.

Thank you very much.

As a reminder, if you would like to ask a question. Please press star one on your telephone keypad and wait for your name to be announced.

If you wish to cancel your request please press star two.

Star one to ask a question.

Pardon me.

Your first question comes from the line of Chris Wetherbee from Citigroup. Please go ahead.

Yeah, Hey, thanks, guys. Thanks for taking the question you know I guess, maybe I wanted to start on the container side and you just get a general sense of your view of you know.

Demand in the market for for any terms. So I guess I'm just trying to get a sense of when we understand that the weakness that's out there and obviously the capacity that is entering the market, but as you think about the opportunity for for employment can you just sort of talk us through what you're seeing in the market and what your thoughts are on activity in the recharge.

You bet.

Yeah.

We've seen that I mean.

In general if you compare our than our old, but they've just pictures a year ago and now I think Oh now you can say that we have a shorter term fixtures for the container ships.

And the charter rates have been have been going down and if we do something expects it.

And to some extent you can argue that the shares it because you cannot have a market going up every single year. After coffee. So for example, the Panamax vessels is now a part of your the traditional pharma does not go down.

So between 17 to 19000 barrels per day prior to that as let's say between 'twenty to 'twenty two and also the fixtures we've seen out there for a year or so is it possible, we could see pictures of higher levels for longer periods.

Especially for the smaller pressure. So you can see the trend is that the tenor of the charter party agreements Ah they've done they tend to become shorter and shorter having said that however stay at I think Oh, we need to know that the market is holding up relatively well and much better.

Those are the people thought.

Six months ago, although we can see a downward trend still the still the charter rate levels. There really two levers are.

So there are various genesee and we can see that our especially for the larger ships.

Our market rates are still quite profitable. So we do have a large order book that needs to be absorbed.

Ah, it's highly question I'm going to where the demand is going up.

In order to Digest, all the order book.

And at the same time, the demolition levels are quite low.

So going forward, what I think.

What the market will be shedding.

I don't think that the supply and demand dynamics, we experienced during COVID-19.

I'd Wanna be there quite the opposite I would say, we do see a downward trend, which is something our expenses at the same time. This means more opportunities our way and they're sort of asset prices.

Together with the charter level Sentosa, new building prices are.

Got it.

Let's say more logical levels are this.

This is a time when we actually got somebody who would be ready to enter the market again as you know we didn't have good then you're bidding or there's other people in the market.

Over the last years.

So we do expect for the market to find a it's all about it's a rate levels and that this may become more interesting.

Okay. Okay. That's helpful. I appreciate that color and then I'll.

Dry bulk platform I you know if you could give us a sense of maybe how you think fourth quarter or maybe early first half looks in terms of.

The vessels you plan to chartering. Obviously this is a little bit of a difficult one for us to model wanted to get a sense of how you're thinking about your capacity in that so we can get a better sense of how revenue and profitability could look there is a very neat.

In the next quarter, but maybe a little bit further beyond that.

Yes, you're right about it this is a very difficult business.

Towards I would say because it's more like Ireland.

Because he said chartering.

In vessels.

So going into others entering into a better reason, it's gotta go read that.

Also have the paperwork in order to complement that we're exploring.

First of all Oh, they're more than excited we're going to have an offline discussion and then we can discuss how old is gonna be.

More streamlined and how can we kind a see each other now are the company has grown quite substantially since it started beginning of the year. It typically nine ships that's out there in we're gonna broad depending on market conditions, we have food.

The whole.

Interested actually in place.

This company that's what we said, we said zero day, they'd say kind of 3% equity funded because we'd love to buy a itself.

And we don't need to grow these but.

If we take the view that the market conditions.

Justified growing further.

Push the accelerator.

In general to have a healthy operator. This is also to crop size and I don't think that we go.

Yeah to reach the desired size elevens, but the timing it would also be dictated by market conditions. So oh, but all we are long term committed to that business. Our goal is to grow described them and we will but the timing I'm afraid we need to have a better view of our market.

Thanks.

We're gonna be evaluated on a quarter by quarter basis.

Okay, Alright, I appreciate it takes them myself offline and get into a little bit more diesel. Thanks for the time I appreciate it sure.

Sure. Thank you.

The next question comes from Omar <unk> with Jefferies. Please go ahead.

Thank you hi, Greg good afternoon.

Uh huh.

Alright. Thanks, Good morning, I just wanted to follow up on on the on Christian's question, just about the dry bulk up platform and it sounds like.

Maybe it and in your response you just know it was kind of talking about maybe the CPI portion of it.

Right.

Yeah I wanted to just ask obviously you have the nearly 1 billion of liquidity you have the $2 7 billion backlog you.

You did or you continue to build out the fleet the owned fleet with the latest capes in the ultra Matt wanted to ask how do you. How do you see that going forward are you looking to continue building. It out from here you know the actual asset ownership side than it is a case that you would be focused on further or is it just simply you're looking to when you are bringing in.

Some bigger shifts in selling some of the older smaller ones kind of how to how do we think about the fleet expansion from here.

Sure.

It was like a our strategy now is.

First of all do.

Two.

<unk>.

To grow the dry bulk of old platform.

And.

What we have been doing we have been selling smaller.

And so now it's older ships. The last time, we sold over 2006 built and we have been buying larger capes and one that all that much.

Younger vessels at take 2011.

Going forward of course assume except the snakes answered that the numbers work out well always try to do it would be too.

<unk> increased the average size of the dry bulk fleet first and are also bringing down the average age.

It sorts of things and we have started with buying those capes and selling the smaller vessels.

Going forward, assuming that we find transactions that make sense to use what we're gonna be doing so the goal ideally would be to.

The amount of time to dispose of.

A smaller hobbies and replace them with a younger and larger ships.

Most of the what was the IMAX and games of course again I have to put a caveat here depending on market conditions and depending on not just practices.

Got it thanks for that and just sort of thinking about that and how you look to build out their own fleet.

How how do you see that that business working with the trading platform.

I may have asked you. This in the past that are are they.

Renting each other at the moment or are they still kind of completely separate businesses.

Uh huh.

Firstly I mean, they are they are you know being run by a different management teams put something that makes sense.

So there are two standalone businesses Oh.

Both under the call somebody Inc.

Perella who's a shareholder.

At the same time, you can argue that they complement each.

Each other a lot.

But that'd be grabbed by different people different amount has been teams are in the <unk>.

First because we are 100% owners are easy CBI in the platform. We have thought that as we also do relapse do category led to recover the book, it's a different business, but they're definitely complement each other and know what's going to be happening in the future I cannot predict again it depends on the market.

The diabetes I think of it.

Uh huh.

It works.

It works out relatively well so we live with education and I don't think so.

I noticed that the corporate image correct.

Got it Okay, and then maybe just one final one and I know you mentioned in the release you committed to the 200 million a to C V I a.

You know if I recall the business was lossmaking in the first half are just the trading side of it.

You mentioned that rates are up.

Order, we've obviously seen us.

Quarter to date average in the fourth quarter relative to what we've seen this year just in general any color you can give on how the platform performed in that in the third quarter and maybe how it sort of sort of looking here in the fourth.

Look at the last one is it fixed at the first six months are there to.

There haven't been a lot of our initial set up cost and it is a company that started operating from a zero or do you think 60 vessels within a short amount of time.

In order to put all the systems in place <unk> hired people and it sounds like would you know our infrastructure supporting the business. So it is something.

Normal to be sort of losing.

Losing money.

First the six miles and we didn't expect to enter into this business didn't do within the first two months or like a year to be highly profitable.

So as I think.

This is more or less the case in order to simulate a platform now going forward what day regarding K Q3, we're going to be releasing the numbers say it with our 6K filings are pretty soon.

I don't know whether the.

That's what the math is gonna be.

But I can tell you that the this is not a short term or even medium term.

Uh huh.

Deal here, we talk about the long term commitment to the sector, which is complementing as we mentioned the dry bulk own fleet. So we're not gonna be taking as a surcharge.

Sorry to the view that it is doing where the first travel to here or that.

After the company was set up the first of the year or like in the first six months. It has always been highly profitable would take a long term view and say I think this is how it should be viewed because we do have a minimum size.

Ah we need to have a minimum size of the book in terms of cargo as well and based on that we're gonna be trading. So are the long term view of this is sort of this remains to be seen but.

The company has been very well capitalized.

Supporting it and we will continue to support the Athens as we measure it.

It has no debt. So it's all of the equity in order to make sure that it's gonna be won't put anything really of any debt restrictions.

Yeah.

Perfect. Okay. Thanks, Greg.

I'll turn it over thanks.

The next question comes from Ben Nolan with Stifel. Please go ahead.

Thanks.

So just to follow up on the on the C. B ice stuff I'm I'm just yeah.

I'm trying to get my head around what causes things to move Greg maybe if you could in in September and then the first part of October we saw a real sharp turn up and the Capesize rates. They have subsequently come down E. Can you can you maybe frame in what that kind of a move.

Does to the profitability, if anything or or or just just trying to see where the sensitivities are with respect to rate movements and profitability.

Look at.

It's it's difficult to say I mean, it's there's also some commercial distinctions here.

We have an FSA book on Capes.

And we also have.

[laughter] front haul voyages on capes as well.

So it's usually each other you know that we entered into it but we got to talk to.

So regarding the volatility in capes, and we really do try to take advantage of it.

Both with the.

Book, and where the positioning of the vessels since it says 37 of those I'm afraid I cannot get into more detail on that because it's like that and you kind of like a <unk> business during Q4, which it said it's difficult for me to explain now in the northern corridor.

But I can tell you that the first like our priority is to monitor downside.

And then Opportunistically capitalize on these capabilities. It is basically the last two to three weeks jeopardizing. The capes market has been available at the end of the same applies for the F. A place and we try to take advantage of the fundamentals.

The panamax market at the same time, we'd say a much more stable.

So he doesn't hold for a little for them.

Volatility and I hope, what you want it but I'm afraid I cannot get into more detail on that exact revealing what we do and what our local short position on capes and Panamax is now which.

It's difficult for me to enter into it.

Okay, well I appreciate the commercial sensitivities around it maybe just from a broader perspective as we're thinking about how you know again, what the drivers for profitability or is it fair to assume that there'll be long periods of time, where there arent any major shifts in profitability.

And then just small episodes of.

The substantial upside is that is that how we should think about you know what what the revenue and profitability.

You know format will look like.

Yeah, Luca if you're already paying to CPI because this is mostly outside yeah yep.

Fifth business day portfolios I can't I can think of that.

Based on the bank local file rate container contracted today bring those two points that they would be on contract with everything else that they're sort of very courtesy dates.

Based on the low breakeven cost of the dry bulk order vessels, which we bought a very good time.

They have a very low leverage and based on the predictability and profitability, although at lower leverage on and off like the extra my time leasing which is a very stable business I think any sort of short term volatility.

In terms of profitability at the CPI level can be very easily absorbed by the whole company otherwise we wouldn't be doing this.

I mean.

And then that's it I think we kind of digest that in the short term.

The downturn of the market, which is something that it's possible to beat and as you cannot avoid it.

However, the upside.

It's a very substantial so the downside based on the rest of the business we hold.

It's something manageable so otherwise we would enter into that business. If we didnt have the containership backlog et cetera.

A lot of upside. So this is how we look at it at the same time. This is a business that is to say complementing our dry bulk of owned vessels.

Which makes sense for us.

So it's it is a.

Calculated risk if I can say that the based on the back normal very contracted revenues low leverage that because I'm not a inc level.

High liquidity.

Attractive long term charters in the containership sector.

A very stable business the leasing business. So I mean, they just have this hub with Hewitt.

Yeah understood and then I was just speaking on a CPI.

Level on a standalone basis, just trying to think through what what the normal.

Hum our path to profitability it looks like just sort of and stabilize ship. It you know kind of modest levels and then every once in a while you see big moves that's.

Oh frame in the most.

You kind of have like a big moves.

Operator: Thank you for standing by, ladies and gentlemen, and welcome to the Costamare Inc. Consent's call on the third quarter 2023 financial results.

Operator: We have with us Mr. Gregory Zikos, Chief Financial 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 time, if you wish to ask a 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, one day, November 1st, 2023. We would like to remind you that this conference call contains forward-looking statements. Please take a moment to read slide number two of the presentation, which contains the forward-looking statements.

Gregory Zikos: And I will now pass the floor to your speaker today, Mr. Zikos. Please go ahead, sir. Thank you, Ed. Good morning, ladies and gentlemen. During the third quarter of the year, the company generated net income of about 53 million. As of quarter, and liquidity was close to 1 billion. It is an intensive sector, and large shifts continue to enjoy a tight market, while smaller versus experience in digital rating conditions. Overall, the market outlook looks uncertain due to the large order book and its efficient demolition.

And you're more by a vaccine to floor or if we do what's gonna be the size movies et cetera, it depends but.

Brought back Como right in the centre and not like a preferred because we think that the government is definitely.

Gregory Zikos: On the diagonal side, as part of our strategy, to renew the fleet and increases our size, we acquire two capes and to our hudramax vessel, and at the same time, we dispose of two order supermax shifts. Our own dribble of vessels continuing to trade on a sport basis, while the trading platform has grown to a fleet of 59 vessels. Having invested 200 million in the dribble operating platform, we are long-term committed to the sector whose further matters review positively.

Divided however, you look at it and they beat US ability. However, you look at it.

We the deep somebody box hopefully I prefer it in the past when it Australia at 15 $16.

Now it sits waiting at the bar or.

Aw.

For lack of a slightly about how big fans of 50 million there to bike back, but we have been focusing on the call Manatu now.

Gregory Zikos: Regarding net summary time leasing, the platform has been steadily growing on a put and basis, having a good look at these interactions for 17 ships in total, which are complemented by a health pipeline extending over the common quarters. Finally, during the quarter, we continued our 30 passes program, and we bought 10 million dollars worth of common shares, highlighting our strong belief that the share price is heavily undervalued, considering both the common performance and prospects.

Which does make sense, however, I cannot predict what like we're gonna be doing the next quarter's we put back in both a $60 million worth of common church, because a program for 30 more about this problem, but this program can be easily extended when she Ah would take it cause it by what.

Alright I appreciate it thank you.

Gregory Zikos: Moving now to the slide presentation. Our slide three, you can see our third quarter results. Net income for the quarter was roughly 53 million or 45 cents per share. Adidas and Entinga was around 54 million or 46 cents per share. Our liquidity stands roughly $1 billion. Slide four, you can see an update on our sale of the vessel's program. Since our return to NX released, we purchased approximately 900,000 common shares for 10 million dollars worth.

I can think about.

The next question comes from Senate knowledge with value investors age. Please go ahead.

Good morning, Thank you for giving you my questions I want to start by asking.

This morning, I wanted to start by asking you about the change in reporting you previously provided the brain donor in a segment basic basic which was really helpful. But the aforementioned breakdown was no prayer for the square there should we expect this change to be bare minimum.

Mmm.

Gregory Zikos: In addition, we continued to have a long uninterrupted dividend track record, boosted by strong sponsor support. Slide five, regarding CBI, we have charted in 59 billion vessels with the majority of the fleet being on index-linked charted in agreement. On our leasing platform, we have already invested around $74 million. Since reception, NML has financed 17 vessels to resale the Lisbon Air, Transactions, and has a very healthy pipeline. Dunning head of slide 6, we have acquired two capes and one ultra-matte drive-back vessel, while we have agreed to sell two super-matte drive-back ships.

Ah the.

The you know the breakdown without the previous quarter. It was of no use at all because in any case you can find it and obviously in the sixth game fighting.

So I'm afraid that we would have to refer you to the suitcase filing where like are you gonna be able to see the breakdown.

Vied with any value and decimated the president is longer I think she's originally took it out.

Right makes sense <unk>.

<unk> bending over already asking about the C V I eat but could you provide some additional insight on how your own dragon vessels perform during deplored term for example, the D C U realized on that side of sleep.

It looks very appropriate the ability of a drive by the way.

Gregory Zikos: In addition, we have concluded the sale of a 2000 wheel container ship, along with the sale, with the sale of our 49% equity interest on another 1998 wheel container ship vessel. Slide 7. During the quarter, we can finance the acquisition of two drive-back vessels to an existing hearty glass and facility, while we have roughly available 144 million for the financing of present acquisition. We continue to target all our drive-back vessels to the spot market, having added it to more than 50 charging agreements since our last end of release.

It's gonna be again part of five or 6K filings.

We have it makes number of fascist we'd have found as we have found a couple of games that we have access I think overall.

Based on the fleet there we have Ah it cause it performed find fault with well, but I don't want to go into more detail what was the D. C. Over they found his ex wife's after than what was there a single family visit et cetera, most of the vicious or like all of them actually with some with very true.

Gregory Zikos: On the garden's website, our revenue days are essentially 100% fixed for this year, 87% for 24% and 73% for 25%, while our contracted revenues are 2.7 billion dollars, with a till you waited remaining time duration of 3.7 years. Slide 8. Our liquidity stands at roughly 1 billion. This liquidity gives us the ability to look for opportunities to grow the company on the food and basis. Slide 9. Charter-Aids, the contingency market, have softened mainly for the smaller sizes, remaining though at about pre-COVID levels.

They are trying to do you wanted to.

Sports market shall we do follow the index.

<unk>. Thanks for the corner that's all for me. Thank you for taking my questions.

Thank you. This concludes that question and answer session I would now like to pass that's Martinez Dude because his closing remarks.

Thank you very much for dialing in in today's God. We're looking forward to speaking with you again in the next quarterly resolve school. Thank you.

Thank you that does conclude our conference for today. Thank you all for participating you may now disconnect your lines.

Gregory Zikos: The added capacity remains at lower levels of 1.7%. On slide 10, you can see the recent drive-back market trends in the spot-a-fourth markets. Charter-Aids have strengths as 62, although remaining volatile. The audiobook is at 8.1% of the total fleet. With that, we can go through to our presentation and we can now take questions. Thank you. Operator, we can take questions now. Thank you very much. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. If you wish to cancel your request, please press star 2. That star 1 to ask a question, pardon me, and your first question comes from the line of Chris Weatherby from City Group.

[noise].

Christian Wetherbee: Please go ahead. Thanks, guys. Thanks for taking the question.

Gregory Zikos: I guess maybe I wanted to start on the container side and it just gives me a general sense of your view of, you know, I guess, demand in the market for any terms. So I guess I'm just trying to give the sense of we understand the weakness that's out there and obviously the capacity that is entering the market. Because you think about the opportunities for employment and you sort of talk us through what you're seeing in the market and what your thoughts are on activity and the recharging set.

Gregory Zikos: Yeah. We've seen that, I mean, in general, if you compare 10 or of previous pictures a year ago. And now, I think on average, you can say that we have sorted their pictures for the container ships. And the chart rates have been going down, which is something expected. And to some extent, you can actually get it shared because you cannot have a market going up every single year after COVID. So for example, the Panamax version is now, for a year, the traditional Panamax is now Between 17 to $19,000 per day, prior to that it was between 22 and 22.

Gregory Zikos: And also the fixes we've seen now there for a year or so in the past we could see pictures of higher levels for longer periods. Especially for the smaller vessels, you can see the trend that the tenor of the charter party agreements, they tend to become shorter and shorter. Having said that however still I think we need to note that the market is holding up relatively well and much better than people thought six months ago.

Gregory Zikos: Although we can see down what the trend, still the charter rate levels, they are very healthy levels. So they are very healthy and we can see that especially for the larger ships, market rates are still quite profitable. So we do have a large order book that needs to be absorbed. It's highly questionable whether demand is going to be there in order to digest all that order book. And at the same time the levels are quite low.

Gregory Zikos: So going forward I think what the market will be shedding, I don't think that the supply and demand dynamics we experienced during COVID are going to be there. Quite the opposite I would say we do see a downward trend which is something expected. At the price, together with charter levels and also new breeding prices come at, let's say, more logical levels. This is the time when we as customers would be ready to enter the market again. As you know we didn't put any new breeding orders at the peak of the market over the last years. So we do expect for the market to find each other at the same rate levels.

Christian Wetherbee: And then this may become more interesting. Okay, that's helpful. I appreciate that color.

Gregory Zikos: On a dry bulb platform, if you could give us a sense of maybe how you think fourth quarter or maybe early first calf looks in terms of vessels you plan to charter in, obviously this is a little bit of a difficult one for us to model, one to get a sense of how you're thinking about your capacity and that so we can get a better sense of how revenue and profitability could look either at the very least in the next quarter, but maybe a little bit further beyond that. Yes, you're right about it.

Gregory Zikos: This is a very difficult business to model. I would say because it's volatile and because it's chartering in vessels, entering into burger charters, entering into a vessel, relays, cargo relays, and we also have an FFA book in order to complement our exposure. First of all, on the modeling side we can have enough light discussion, then we can discuss how this can be more streamlined and how we can assist each other. Now, the company has grown quite substantially since it started beginning of the year.

Gregory Zikos: We're going to grow depending on market conditions. We have put the whole infrastructure in place. This company runs with a zero debt. It's 100% equity funded because it's and we don't need to grow this, but if we take the view that the market conditions justify growing further, we will push the accelerator. In general, to have a healthy operator, this operator needs also to have size and I don't think that we have yet reached the desired size levels.

Gregory Zikos: But the timing, it will also be dictated by market conditions. So overall, we are long-term committed to that business, our goal is to grow this further and we will. But the timing, I'm afraid we need to have a better view of the market and we're going to be evaluating on a quarter by quarter basis. Okay. Sorry, no, I appreciate we can take from us off line and get into a little bit more diesel. Thanks for the time. Appreciate it. Sure, thank you.

Omar Nokta: The next question comes from Omar Nokta with Jeffrey. Please go ahead. Thank you. Hi, Greg. Good afternoon. Yeah, just a couple of notes. Morning. Thank you. Yeah. Morning.

Gregory Zikos: I just wanted to follow up on on Chris' question just about the dry bulk of platform. And it sounds like you're maybe in your response here just now. It was kind of talking about maybe the CBI portion of it. Great. Yeah, I wanted to just ask obviously you have the nearly billion of liquidity. You have the 2.7 billion backlog. You did or you continue to build out the fleet, the own fleet with the latest case and the Ultramax.

Gregory Zikos: I wanted to ask, how do you see that going forward? Are you looking to continue building it out from here, you know, the actual asset ownership side? And is it case that you would be focused on further or is it just simply you were looking to renew, you know, bringing in some bigger shifts and selling some of the older smaller ones? How do you rethink about the fleet expansion from here?

Gregory Zikos: Sure. What like our strategy now is a principle to grow the dry bulk, own platform. And what we have been doing, we have been selling smaller and now that all the ships, the last one we saw the 2006 build, and we have been buying larger vessels, capes and one Ultramax, younger vessels at 8, 2011 build. So going forward, of course, assuming that this makes sense, that the numbers work out well. Our strategy would be to increase the average size of the dry bulk, own fleet first.

Gregory Zikos: And also a big down the average age. It's those two things and we have started with buying those capes and selling the smaller vessels. Going forward, assuming that we find transactions that make sense, this is what we're going to be doing. So the goal, ideally, would be to, in a reasonable amount of time to dispose of the smaller candies and replace them with younger and larger ships as mostly Ultramax and capes. Of course, again, I have to put a card, but here depending on market conditions and depending on our price.

Gregory Zikos: Thank you for that and just thinking about that and how you looked to build out the own fleet. How do you see that business working with the trading platform? I think I may have asked you this in the past. Are they complementing each other at the moment or are they still completely separate businesses? First I mean they are you know being run by different management teams with something that makes sense. So there are two standalone businesses all both under the Costamare Inc, umbrella who is a servoder.

Gregory Zikos: At the same time you can argue that they complement each other a lot. But they are being run by different people, different management teams. In the first business we are 100% owners. In the CBI, in the platform we are chartered as we also do relapse. We do cargo relapse, we have an FFA book, it's a different business but they definitely complement each other now. What's going to be happening in the future, I cannot predict, again, it depends on market produce but for the time being I think it works out relatively well. So we leave it as it is and there are a lot of synergists in the company. That's correct. Got it.

Gregory Zikos: And then maybe just one final one and you know you mentioned in the release you committed the 200 million to CBI. You know if I recall the business was lost making in the first half just a trading side of it. You mentioned that rate of quarter, we've obviously seen that quarter's date average in the fourth quarter relative to what we've seen this year. But just in general any color you can give on how the platform performed in the third quarter and maybe how it's sort of looking here in the fourth.

Gregory Zikos: Yeah, look the platform that fixed the first six months there have been a lot of initial set up costs and it is a company that started operating from zero reaching 60 investors within a sort of amount of time in order to put all the systems in place, higher people and have the whole you know infrastructure support in the business. So it's something normal to be sort of losing money the first six months and we didn't expect to enter into this business and within the first months or like a year to be highly profitable.

Gregory Zikos: So I think this is more or less the case in all similar platforms. Now going forward regarding Q3 we're going to be releasing the numbers with our six K filings pretty soon. For a year and I don't know where the how the platform is going to be performing but I can tell you that this is not a short or even a medium term deal here. We talked about a long term commitment to the sector which is complementing as we mentioned the dry bulk own fleet.

Gregory Zikos: So we're not going to be taking a you know a short-sighted view that it is doing well the first half of the year or that after the company was set up the first year or like the first six months it has not been highly profitable. We take a long term view and I think this is how it should be viewed because we need to have a minimum size. We need to have a minimum size of the book in terms of cargo book as well and based on that we're going to be trading.

Gregory Zikos: So the long term view this is sort of this image to be seen but the company has been very well capitalized. We are supporting it and we will continue supporting it and as mentioned earlier it has no debt so it's all equity in order to make sure that it's going to be operating freely of any debt restriction.

Gregory Zikos: Perfect. Okay, thanks, Greg. Very, very helpful.

Gregory Zikos: I'll turn it over. Thanks.

Ben Nolan: The next question comes from Ben Nolan with Steeple. Please go ahead. Thanks. So just to follow up on the on this TBI stuff, I'm just just as I'm trying to get my head around what causes things to move. Greg, maybe if you could in September and in the first part of October, we sell a real sharp turn-up and the Cape size rates that have subsequently come down. Can you maybe frame in what that kind of a move does to the profitability, if anything, or just trying to see where the sensitivities are with respect to rate movements and profitability?

Ben Nolan: Look, it's it's difficult to, I mean it's social, some commercial restrictions here. We have an FFA book on capes and we also have a front hall voyages on capes as well. So since we charter in and then we enter into a voyages charter. So regarding the volatility in capes, we do try to take advantage of it, both with the FFA book and with the positioning of the presence and set 37 of those.

Gregory Zikos: I'm afraid I cannot get into more detail on that because it's like telling you how like we run our capes business during Q4, which it's difficult for me to explain now in an open core. But I can tell you that the first like priority is to monitor the downside. And then opportunistically, capitalized on this capes volatility, especially the last two to three weeks, chartering the capes market has been very volatile and the same applies for the FFA. And we try to take advantage of it. The Panama's market at the same time, it's a much more stable. So it doesn't offer a lot of volatility driven opportunities.

Gregory Zikos: But I'm afraid I cannot get into more detail on that. It's like revealing what we do and what our long core short position on capes and to Panama is now which it's difficult for me to enter into.

Gregory Zikos: Okay, well, and I appreciate the commercial sensitivity around that. Maybe just from a broader perspective as we're thinking about how, again, what the drivers for profitability are, is it fair to assume that there'll be long periods of time where there aren't any major shifts in profitability and then small episodes of substantial upside. Is that how we should think about what the revenue and profitability format would look like? Yeah, look, if you're referring to CBI because this is the most part I think, the now business portfolios, I can take you that based on the backlog of our company, contract-driven news, you can say, with the contract-driven news, so that we'll be based on the low breakeven cost of the dry bulk owned vessels which we bought at a very good time and they have a very low leverage and based on the predictability and profitability although at lower levels of like the nepsomite time leasing which is a very stable business I think any sort of short term volatility in terms of profitability at the CBI level can be very easily absorbed by the whole company otherwise we wouldn't be doing this.

Gregory Zikos: So I mean in a nutshell I think we can digest any short term downturn of the market which is something that it's part of the business you cannot avoid it however the upside it's very substantial so the downside based on the rest of the business we hold it's something manageable so otherwise we would enter into that business if we didn't have the concurrency backlog etc and there is a lot of upside so this is how we look at it. At the same time this is a business that is complementing our dry bulk owned vessels which makes sense for us so it is a calculated risk if I can say that based on the backlog of the contracted revenues low levels at the Costamare Inc level, high liquidity, attractive long term chapters in the contents of sector, very stable business leasing business so I mean this is how could you eat?

Gregory Zikos: Yeah I understand and I was just speaking on a CBI level on a standalone basis just trying to think through what a normal path to profitability looks like just sort of establish it at you know kind of modest levels and then every once in a while you see big moves that's how you frame it. You can have like bigger moves which does not translate into cars in the market market of the FFA's like unrealized losses or gains which however do not have a car's impact but it is profitability in brackets affecting EPS they maybe move there from the pure operation of the business start the reins after out the end of the intermediate chapters etc and settlement of FFA's leaving a side and realized exposure for the whole size of Costamare this is this is not something that could change the fundamentals of our profitability.

Gregory Zikos: Sure yeah no and and I appreciate that the last question for me is just on the on the buybacks obviously see the the common buybacks and curious you know I mean a first of all it's been exclusive to the common and not to the preferred so I know it can be either curious how you're thinking about that and in terms of the common buybacks I mean is this the ten million dollars that this is sort of a what you think is a good run rate per quarter. Yeah, look, I cannot predict the future.

Gregory Zikos: I cannot tell you like, well, we're going to be doing any more by a vaccine to four or if we do, but we're going to be the size of it, et cetera. It depends, but we put back a common as you rightly said, and not like a preferred, because we think that the common is definitely undivided. However, you look at it, it's of an ability, however you look at it. We did some buybacks of a preferred in the past when it was trading at $15,000.

Gregory Zikos: Now it's trading out at par or slightly above par, we have 150 million there to buy back. But we have been focusing on the common up to now, which does make sense. However, I cannot predict what like we're going to be doing the next quarters. We put back in total $60 million worth of common search. We have a program for 30 more, but this program can be easily extended. We'll see. We take it quarter by quarter. Yeah, all right.

Gregory Zikos: I appreciate it. Thank you.

Simon Mullins: The next question comes from Simon Mullins with value investors edge. Please go ahead.

Gregory Zikos: Good morning. Thank you for taking my questions. I want to start by asking. Good morning. I wanted to start by asking about the change in reporting. You previously provided a breakdown on a segment by segment basis, which was really helpful. But the aforementioned breakdown was not provided that for this quarter. Should we expect this change to be permanent? The breakdown we had in the previous quarter was of no use at all because in any case you can find the numbers in the 6K filing.

Gregory Zikos: So I'm afraid I will have to refer you to the 6K filing where like you're going to be able to see the breakdown. It didn't provide with any value. It just made the present is longer. This is the reason we took it out. All right, make sense.

Gregory Zikos: Chris, Ben and Omer already asked about CVI, but could you provide some additional insight on how your own dribble vessels perform during the quarter? For example, the TCE you realized on that side of the fleet? Look, the profitability of the dribble vessel is going to be, again, part of our 6K filing. We have a mixed number of, since we have a hand, we have a couple of capes, we have panamaxes. I think overall based on the fleet we have, it has performed fine, it has performed well, but I don't want to go into more detail what was the TCE of the hand is XYZ and then what was the rating of every vessel, etc. Most of the vessels, or like all of them actually, with some very few exceptions, they are trading on the spot market, so we do follow the index. Big sense, thanks for the caller.

Simon Mullins: That's all from me. Thank you for taking my questions. Thank you.

Operator: This concludes our question and answer session.

Gregory Zikos: I would now like to pass the floor to Mr. Ziko for his closing remarks. Thank you very much for dialing in today's call. We are looking forward to speaking with you again in the next quarterly resource call. Thank you. Thank you, but does conclude our conference for today. Thank you all for participating. You may now disconnect your lines.