Q1 2024 Euroseas Ltd Earnings Call
Yes.
Operator: Thank you for standing by, ladies and gentlemen, and welcome to Euroseas' conference call on the first quarter 2024 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer, and Mr. Anastasios Aslidis, Chief Financial Officer of the company.
Speaker Change: Thank you for standing by ladies and gentlemen, and welcome to <unk> Conference call on the first quarter 'twenty 'twenty four financial results, we have with US Mr. Aristides Peters, Chairman and Chief Executive Officer, and Mr. Ty says the Sweetest Chief Financial Officer of the company at this.
Operator: At this time, all participants are in a listen-only mode. There will be a presentation followed by a question and answer session. At that time, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced.
Speaker Change: Time, all participants are in a listen only mode there'll be a presentation followed by a question and answer session at which time if you wish to ask a question. Please press star one on your telephone keypad and wait for your name to be announced I must advice you that this conference call is being recorded today please be.
Operator: I must advise you that this conference call is being recorded today. Please be reminded that the company announced its results in a press release that has been publicly distributed. Before passing the floor over to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal security laws; matters discussed may be forward-looking statements that are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.
Speaker Change: You're reminded that the company announced their results with a press release that has been publicly distributed.
Speaker Change: Before passing the floor over to Mr. P. That's I would like to remind everyone that in todays presentation and conference call. Yes. He is well be making forward looking statements. These statements are within the meaning of the federal security laws.
Speaker Change: Matters discussed may be forward looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.
Operator: I kindly draw your attention to slide number two of the webcast presentation, which contains the full forward-looking statement, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it.
Let me draw your attention to slide number two on the webcast presentation, which has the full forward looking statement and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it and now I would like to pass the floor over to Mr. Peter <unk>. Please go ahead Sir.
Speaker Change: Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call.
Aristides J. Pittas: Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me is Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the three-month period ended March 31st, 2024. So, let's turn to slide 3 of the presentation to go over our income statement highlights. For the first quarter of 2024, we reported total net revenues of $46.7 million and a net income of $20 million, or $0.287 per diluted share. Adjusted net income for the quarter was $18.5 million, or $2.66 per diluted share.
Speaker Change: Together with them and discuss those facilities.
Speaker Change: Chief Financial Officer.
Speaker Change: The purpose of today's call is to discuss our financial results for the three months period ended March 31st 2024.
Aristides J. Pittas: Adjusted EBITDA for the period was $24.6 million. A reconciliation of Adjusted Net Income and Adjusted Dividend to Adjusted Net Income is shown in the press release. Our CFO, Tasos, will go over our financial highlights in more detail later on in the presentation. As part of the company's common stock dividend plan, the board of directors declared again a quarterly dividend of $0.60 per common share for the first quarter of 2024, which will be payable on or about June 21st, 2024 to shareholders of record on June 14th.
Speaker Change: Let's turn to slide three of the presentation to go over our income statement highlights.
Speaker Change: For the first quarter of 'twenty 'twenty four we reported total net revenues were $46 $7 million and the net income was $20 million or 2.87 cents per diluted share adjusted net income for the quarter was 18, and a half million dollars or $2.
Speaker Change: 66 cents per diluted share.
Speaker Change: Adjusted EBITDA for the period was $24 $6 million.
Speaker Change: A reconciliation of the adjusted net income and adjusted EBITDA to net income as shown in the press release, our CFO, who will go over our financial highlights in more detail later on in the presentation.
Speaker Change: That's part of the company's common stock dividend plan, our board of directors declared again, the quarterly dividend to <unk> 60 cents per common share for the first quarter of 'twenty, 'twenty, four which will be payable on or about June 21st 20, 24% holders of record on June.
Speaker Change: Four things.
Aristides J. Pittas: The annualized dividend yield based on the current share price is again above 6%. This is the ninth consecutive quarter of paying meaningful dividends. As of May 23rd, 2024, we had also repurchased 400,705 of our common stock in the open market for a total of about $8.2 million since the initiation of our share repurchase plan of up to $20 million, which was announced in May 2022. We will continue to use our sales repurpose program at management's discretion, depending on our stock price, to enhance our ability to drive long-term shareholder value.
Speaker Change: The annualized dividend yield based on the current share, but it is again above 6%.
Speaker Change: This is the ninth consecutive quarter of paying meaningful dividends.
Speaker Change: I was just amazed twenty-first 'twenty 'twenty four we had also repurchased 400.
Speaker Change: <unk> thousand 700, <unk> five of our common stock in the open market for a total of about $8 2 million live soon.
Speaker Change: Since the initiation of a share repurchase plan of up to $20 million, which was announced in May 2022.
Speaker Change: We will continue to use out of phase with both this program with management's discretion, depending on the stock price to enhance our ability to drive long term shareholder value.
Speaker Change: Please turn to slide four where I will discuss our recent sales and purchase new be anything to us having an operation of developers.
Aristides J. Pittas: Please turn to slide 4, where we discuss our recent sales and purchase, new building, chartering, and operational development. On the S&P front, we have agreed to sell Motovessel Astoria, a 2800 TEU feeder container ship vessel built in 2004, for approximately $10 million to an unaffiliated party. The sale capitalizes on the current strong asset prices, and we will log a significant profit next quarter when the deal closes.
Speaker Change: On the S&P front, we have agreed to sell multiple vessel a storm here at 2800 do you feed the containership vessel built in 2004 for approximately $10 million two and then an affiliated party.
Speaker Change: The sale capitalizes on the current strong asset prices and we were long as significant profits in Mexico when the deal closes.
Aristides J. Pittas: The vessel is expected to be delivered to her new owners by mid-June 2024. The delivery of our fourth new building vessel from the series of nine took place on April 25th. Motovessel Leonidas Z, a new fuel-efficient 2,800 TEU feeder container ship, was chartered with Hapac Lloyd, one of the largest liner companies, for a period of about two years at a daily rate of $20,000 a day. This charter is expected to contribute about $9 million of EBITDA for the contracted period and increases our 2024 charter coverage to about 88%. Moreover, the delivery of the fifth vessel took place on May 13th when the Motovessel Monika, a fuel-efficient 1800 T.U.
Speaker Change: The vessel is expected to be delivered to her new owners by mid June 'twenty 'twenty four.
Speaker Change: Delivery of our first new building vessels from the series of benign took place on April 25th.
Speaker Change: Motor vessel, neither there's a new building fuel efficient 2800 P. You feed the container ship with Jonathan was cutback Lloyd one of the largest liner companies for a period of about to use at a daily rate of $10000 a day.
Speaker Change: This trial is expected to contribute about $9 million of EBITDA for the contracted period.
Speaker Change: Increases of 'twenty 'twenty, four charter coverage to about 88%.
Speaker Change: Moreover, the delivery of the fifth vessel took place on May 17.
Monica: When motor vessel Monica.
Monica: Fuel efficient 1800, do you feed the vessel.
It was.
Aristides J. Pittas: feeder vessel, was was chartered for a minimum period of 10 to a maximum period of 12 months as the option of the charterer at a daily rate of $16,000 per day. Continuing on the charter side, our Aegean Express, our smallest and oldest vessel, was fixed for a minimum period of 7 to 9 months at $8,000 a day, starting from March 23rd, after a three days wait, while motor vessel Synergy Antwerp was fixed for a minimum of eleven and a half months to maximum of fourteen months at 26,500 per day, starting immediately upon delivery from the shipyard where it underwent its normal dry docks and retrofits, and this new charter starts from April 2nd, 2024.
Monica: Was targeted for a minimum period of 10 to a maximum period of 12 months. That's the option of the childhood at a daily rate of $16000 per day.
Monica: Continuing on the Chaucer side.
Monica: Oh, the Aegean express, our smallest and oldest vessel.
Monica: Was fixed for a minimum period of seven to nine months at $8000. A day starts starting from March 23rd.
Monica: After three days right why is the motor vessel <unk> and felt it was fixed for a minimum of 11 and a half months to maximum of 14 months. That's 26005 times a day starting immediately upon delivery from the shipyard where it underwent a it's normal.
Speaker Change: Dogs and looking at sofas and.
Speaker Change: This new trial starts from April 2nd 2024.
Aristides J. Pittas: Finally, Motovessel Johanna was just extended for a minimum of two to a maximum of three months with current charters at $13,500 per day. Regarding dry dockings, our motor vessel Synergy Auckland underwent its scheduled special survey for approximately 18 days.
Speaker Change: Finally motor vessel Joanna was just extended for a minimum of two to maximum of three months, we've got himself at $13500 per day.
Speaker Change: Regarding dry dockings are motor vessel synergy Auckland underwent its scheduled special survey for a box of at least 10 days.
Speaker Change: Our motto vessel Marcos.
Aristides J. Pittas: Our motor vessel Marcos successfully completed its scheduled 31-day dry dock, which included retrofits worth about $1.8 million. As in the case of the recent retrofit of the Motovessel Synergy Busan, we cooperated closely with the Charterer to fund the modifications of the vessel and share the economic benefits from the improved performance. The Charter simultaneously declared the option to extend the Charter by an additional minimum seven months until August 2025. The added retrofits resulted in an improvement of her consumption in the commercial speed range by about 25%.
Speaker Change: Successfully completed its scheduled 31 days that I look which included the retrofits worth about $1.8 million.
Speaker Change: I think the case from the recent retrofit of motor vessel synergy with Sun recall operated closely with the child well to fund the modifications of the vessel and Saturday economic benefits from the improved performance.
Speaker Change: It's also just contemporaneously declare the option to extend the charter by Ed.
Speaker Change: Additionally, the minimum seven months until August 2025.
Speaker Change: The other the retrofits resulted in an improvement of her consumption in the comparison speeds the range by about 25%.
Speaker Change: I spent a lot of them and getting them into the sauce. If the vessel is employed after the kind of inside the period when the owners really fund part of the cost to the chalk up to a maximum of 50%.
Aristides J. Pittas: As per our agreement with the Charterers, if the vessel is employed after the current Charter period, then the owners will refund part of the cost to the Charterers, up to a maximum of 50%. The Motor Vessel Synergy Antwerp, as I said, also successfully completed her scheduled 30-day dry dock. As part of our efforts to minimize our carbon footprint, C2 underwent a $1.25 million retrofit.
Speaker Change: The motor vessel synergy and roof as I said all also successfully completed.
A scheduled 30 day dry dock.
Speaker Change: As part of our efforts to minimize our carbon footprint to underwent a $125 million of epilepsy.
Speaker Change: Next please turn to slide five for an update on our current fleet profile.
Aristides J. Pittas: Next, please turn to slide 5 for an update on our current fleet profile. Our current fleet is comprised now of 22 vessels in the water, 15 feeder container ships, and 7 intermediate container carriers, with a total carrying capacity of just under 66,500 TEU and an average age of 15 years. Weighted by TAU, turn to slide 6.
Speaker Change: Our current fleet is comprised now of 22 vessels in the water. The 15 feed the container ships and seven intermediate contained the guy that is with a total carrying capacity of just under 16, 66500, Teu and an average age of 15 years.
Speaker Change: Weighted by T U.
Speaker Change: Turn to slide six.
Speaker Change: Here, we show our four remaining vessels under constructions will deliver as expected throughout 2024.
Aristides J. Pittas: Here we show our four remaining vessels under construction, with deliveries expected throughout 2024. The four new buildings have a total carrying capacity of 9,200 TEU, and they include two 2,800 TEU vessels and two 1,800 TEU vessels. After the delivery of its four remaining FIDE container ships new buildings in 2024, Euroseas' fleet will consist of 26 vessels with a total carrying capacity of about 75,000 TUs. Let's now turn to slide 7 to see the vessel employment graphic.
Speaker Change: The four new buildings have a total carrying capacity of the 9200 Teu and they include two 2800 Teu vessels and two 1800 Teu vessels.
Speaker Change: After the delivery of which four remaining feeder container ship new buildings in 2024 universities fleet will consist of 26 vessels with a total carrying capacity of.
Speaker Change: About 75000 Teu.
Speaker Change: Let's now turn to slide seven to see the vessel employment graphically.
Aristides J. Pittas: As you can see, we have very strong charter coverage throughout the next two years, with about 88% of our fleet being fixed for 2024 and about 32% for 2025. Our significant charter coverage and profitable rates for the remainder of the year suggest highly profitable quarters that will further enhance our fleet liquidity throughout 2024 and 2025. Let's turn to slide 9 for a broader market review, starting with the development of the 6-12 month time shutter age over the last 10 years.
Speaker Change: As you May see we have a very strong charter coverage throughout the next two years with about 88% of our fleet being fixed for 'twenty 'twenty, four and about 32% for 2025.
Speaker Change: Significant charter cover lives unprofitable of age for the remainder of the year suggest highly profitable quarters would prefer them concept fleet liquidity throughout 'twenty 'twenty four and 2025.
Speaker Change: Let's turn to slide nine for a broader market review starting with the development of the six to 12 month time charter rates over the last 10 years.
Speaker Change: During the first quarter and extending into mid May 2020 for containership charter rates have shown a robust recovery so things significantly from their low levels at the start of the year.
Aristides J. Pittas: During the first quarter and extending into mid-May 2024, container ship charter rates showed a robust recovery, surging significantly from the low levels at the start of the year across all segments. As of May 17, 2024, the 6 to 12-month charter rate for a 2,500 TEU container ship stood at $19,500 per day, which is higher than the historical median of $9,200 per day, about double, and is supported when compared also with a 10-year average of about $15,500 per day. The comparisons to median and average rates are similar across the smaller and larger container subsizes as well.
Speaker Change: All six segments.
Speaker Change: I was wondering may 17th 2024, the six to 12 months charter rate for two and a half thousand Teu content containership stood at $19500 per day, which is higher than the historical median of $9200 a day about.
Speaker Change: Food and well supported well compare also with a 10 year average or about 15 in the $5000 per day.
Speaker Change: The comparison to median the neighborhoods of AIDS Assembly live across the smaller and larger container sizes as well.
Speaker Change: Moving on to Slide 10, we go over some further market highlights.
Aristides J. Pittas: Moving on to slide 10, we go over some further market highlights. As mentioned, one-year time charter rates improved the cross-haul segments in the first quarter, and charter rates have increased by approximately 73% to date since the low of December 21st, 2023. The current increase is mainly attributed to the tensions in the Red Sea and consequent route diversion. The full impact of rerouting is yet to be seen, though, as these geopolitical issues are still evolving.
Speaker Change: As I mentioned, one year time charter rates improved across all segments in the first quarter.
Speaker Change: And sorry, if the rates having increased by approximately 73% today since the low of December 21st 2023.
Speaker Change: The current increase is mainly attributed to the tennis shoes in the Red Sea and consequent Tuesday versus.
Speaker Change: The full impact of the rerouting is yet to be seen though as these geopolitical issues are still evolving.
Speaker Change: That said and before charter rates since the end of the year have increased by over 70%.
Aristides J. Pittas: As said before, charter rates since the end of the year have increased by over 70%. Average daily rates increased by 26% over the average of Q4 2023 during the first quarter of 2024. This can be seen in the table below, across all container segments.
Speaker Change: Average daily rates increased by 26% over the average of Q4 2023 during the first go through 'twenty 'twenty four and.
Speaker Change: And this can be seen in the table below across all container segments.
Speaker Change: The last thing could easing of age during May 'twenty 'twenty four is primarily due to the whole thing from the Red Sea.
Aristides J. Pittas: The vast increase in rates during May 2024 is primarily due to rerouting from the Red Sea. The average second-hand price index saw an increase of about 11% during the first quarter of 2024 compared to the fourth quarter of 2023. Oil prices, of course, continue to lag significantly behind the peak levels seen in 2022, but they are above the average levels observed before the COVID-19 pandemic. The new building price index increased by about 7% in the first quarter compared to the previous quarter. New building prices continue to stay elevated due to cost inflation and extended yard forward cover.
Speaker Change: And the average second hand price index show, an increase of about 11% during the first go through 'twenty 'twenty four compared to the fourth go through 'twenty two in between.
Speaker Change: While prices of course continued to lag significantly behind the peak levels seen in 2022. They are above the average levels observed before the COVID-19 pandemic.
Speaker Change: The new building pricing mix increased by about 7% in the first sculptor compared to the previous quarter.
Speaker Change: New metering prices continue to stay elevated due to cost inflation and extended yard full of cover.
Speaker Change: Although there has been some easing in newbuild contracting from the exceptional high levels witnessed during COVID-19. It remains relatively firm amid continued appetite from liner companies with excess gas renewing the fleet with the alternative fuel business.
Aristides J. Pittas: Although there has been some easing in new-build contracting from the exceptional high levels witnessed during COVID-19, it remains relatively firm amid continued appetite from liner companies with excess cash to renew their fleets with alternative fuel vessels. As of May 6, 2024, the idle fleet, excluding vessels under repair, stands at just 190,000 TEU, accounting for 0.7% of the total fleet. This marks a decline from its peak of about 800,000 TEU just one year ago, with a downward trend observed since then.
Speaker Change: As of May six 2020 for the idle fleet, excluding vessels under repair stands at just under the 90000 Teu accounting for 0.7% over the total fleet.
Speaker Change: This marks a decline from its peak of about 800000 Teu just one year ago.
Speaker Change: With the downward trend observed since then.
Speaker Change: In 2024 up to now 23 vessels accounting for 33000 Teu have been scrapped.
Aristides J. Pittas: In 2024, so far, 23 vessels accounting for 33,000 EU have been scrapped. We expect demolition activity to increase slightly in the remainder of 2024 after a number of quieter years, which were due to higher charter rates. Although the current geopolitical disruptions may continue to limit scrapping at the end, in the first quarter of 2024, scrapping prices softened slightly to approximately $540 per lightweight ton, remaining above the average observed in 2019 by about 30%. Overall, the fleet continues to grow, having expanded by about 4% year-to-date, without accounting, of course, for idle vessel reactivation. Please turn to slide 11.
Speaker Change: We expect demolition activity to increase slightly.
Speaker Change: The remainder of 'twenty 'twenty four after a number of quieter. He is due to that which were due to the higher charter rates.
Speaker Change: Although the current geopolitical described disruptions may continue to limit scrapping at CN.
In the first quarter of 2024, scabbing prices soften slightly to approximately $540 per lightweight ton.
Speaker Change: The remaining though above first.
The average observed in 2029 2019 by.
By about 30%.
Speaker Change: Overall, the fleet continues to grow having expanded by about 4% year to date without accounting for of course for idled vessels with activation.
Speaker Change: Please turn to slide 11.
Speaker Change: The IMS latest updates from April of 'twenty 'twenty four projects that the global economy will see another year of slow yet steady growth raising the forecast from three 1% to three 2% in 2024.
Aristides J. Pittas: The IMF's latest update from April 2024 projects that the global economy will see another year of slow yet steady growth, raising the forecast from 3.1% to 3.2% in 2024. This growth rate is expected to continue into 2025. This is largely due to a sizable improvement in the economic outlook for the United States, offset by a more modest slowdown in emerging and developing economies. The forecast for the next five years is at its lowest in decades, at 3.1%.
Speaker Change: This growth rate is expected to continue into 2025.
Speaker Change: This is largely due to a sizable improvement in the economic outlook for the United States offset by a more modest slowdown in the emerging and developing economies.
Speaker Change: The focus for the next five years is at its lowest in decades of three 1%.
Speaker Change: The global economy has been surprisingly resilient, despite significant central bank interest rate hikes to restore price stability.
Aristides J. Pittas: The global economy has been surprisingly resilient despite significant central bank interest rate hikes to restore price stability. Indeed, global inflation is declining steadily and is projected to fall from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025, with the advanced economies returning to their inflation targets sooner than emerging markets and developing economies. Most banks now anticipate that the three Federal Reserve rate cuts that were projected by the end of 2024 will be reduced to two or one due to this persistent inflation.
Speaker Change: Indeed, the global inflation is declining steadily and is projected to lower from six 8% in 2023 to five 9% in 2024 and four 5% in 2025.
Speaker Change: With the advanced economies with burning through their inflation targets sooner than the emerging markets and developing economies.
Speaker Change: Most banks now anticipate that the three fed developed reserve the rate cuts that were projected by the end of 'twenty 'twenty four will be reduced to two or one due to this persistent inflation.
Speaker Change: During this call to the IMF upgraded significantly versus 2024 growth forecast to three 2% from the two 6% projected in January 2024.
Aristides J. Pittas: During this quarter, the IMF significantly upgraded Russia's 2024 growth forecast to 3.2 percent from the 2.6 percent projected in January 2024, due to the continued strong oil exports amid high global oil prices, despite the price cap mechanism imposed by Western countries, as well as due to strong government spending and investment related to war production, along with higher consumer spending in the tight labor market. The IMF also upgraded Russia's 2025 growth forecast to 1.8% from 1.1%. It seems that Western sanctions are not working.
Speaker Change: Due to the continued strong oil exports amid high global oil prices, despite the price cap mechanism imposed by western countries.
Speaker Change: As well as due to strong government spending and investments related to well production.
Speaker Change: Along with higher consumer spending in a tight labor market.
Speaker Change: The IMF also upgraded the Russell 2025 growth forecast to one 8% from one 1%.
Speaker Change: It seems that the western sanctions are not working.
Speaker Change: For shipping we continue to monitor China's economy closely.
Aristides J. Pittas: For Shipping, we continue to monitor China's economy closely, which is relatively stagnant due to the enduring downturn in its property sector. The Chinese economy is forecast to grow by just 4.6% in 2024 and 4.1% in 2025. China's economic woes may further intensify due to trade tensions in an already weakened geopolitical environment, and therefore, stability may take even longer to be restored. On a more positive note, though, growth in India is projected to remain strong at 6.8% in 2024 and 6.5% in 2025, with robustness reflecting strong domestic demand and a rising working-age population. Similarly, the ASEAN-5 economies are expected to grow quite strongly, thus assisting SIT.
Speaker Change: Relatively to the past struggling by the enduring downturn in its property sector.
Speaker Change: The Chinese economy is forecast to grow by just four 6% in 2024 and four 1% in 2025.
Speaker Change: Chinese economic woes may further intensify due to trade tensions in the Lola already weakened geopolitical environment, and therefore stability may take even longer to be restored.
Speaker Change: On a more positive note, though growth in India is projected to remain strong at six 8% in 'twenty 'twenty four and six 5% in 2025 with robust robustness, reflecting strong domestic demand and the rising working age population.
Speaker Change: Similarly, the ASEAN five economies are expected to grow quite strongly thus assisting shipping.
According to Clarksons forecast containership trade demand is expected to significantly increase from the five 5%, which was previous projections to nine 2% now.
Aristides J. Pittas: According to Clarkson's forecast, containership trade demand is expected to significantly increase from the 5.5% which were previous projections to 9.2% now. However, a decrease of 2.4% in trade demand is now projected for 2025. These latest forecasts assume about half a year more of disruption to container trade due to Red Sea rerouting, uplifting TEU mile demand to about 11% currently and 5% overall for the full year. The Panama Canal Impact is less severe, but demand estimates have allowed for some additional trans-Pacific trade volumes being shipped to the U.S. West Coast rather than the East Coast, given restrictions on Panama Canal Transit.
Speaker Change: However, a decrease of two 4% in trade demand is now project for 2025.
Speaker Change: These latest forecasts assume about half a year more of a disruption to container trade due to see little thing uplifting the U mild demand to about 11% currently and 5% overall for the full year.
Speaker Change: Panama Canal impacts.
Speaker Change: Less severe but demand estimates have allowed for some additional transpacific trade volumes being shipped to the U S West coast, rather than the east coast, given the restrictions of the Panama Canal countries.
Aristides J. Pittas: This is generally, though, a much smaller impact than the Red Sea Disruption. And, of course, a longer-than-assumed crisis in the Red Sea will likely result in significantly higher demand growth. Please turn to slide 12, where you can see the total Fleet Tate's profile and container supporters. The containership fleet is relatively young, with most vessels under 15 years old, and only 10% of the fleet over 20 years old, the largest percentage of which, though, lies within the feed the vessel, suggesting high potential recycling for this type of sheet. As of April 24, 2024, the order book as a percentage of lead stands at around 21 percent, reduced from close to 30 percent, which we saw last year.
Speaker Change: This is generally though a much smaller impact than the red sea disruption.
Speaker Change: And of course, a longer than assumed crises in the Red Sea will likely result in significant higher demand growth.
Speaker Change: Please turn to slide 12, where you can see the total fleet age profile and Containership order book.
Speaker Change: The containership fleet is relatively young with most vessels under 15 years old and only 10% of the fleet over 20 years old.
Speaker Change: And the largest percentage of which though lies within feed the vessels.
Speaker Change: Suggesting high potential recycling for these type of ship.
Speaker Change: As of April 24, 2024, the order book as a percentage of fleet stands at around 21%.
Speaker Change: Used from close to 30%, which which we saw last year.
Speaker Change: Turning on to Slide 15, we also go over the fleet age profile and order book for ships in the 1000 to 3000 Teu range.
Aristides J. Pittas: Turning on to slide 13, we also go over the Fleet Age profile and order book for ships in the 1000 to 3000 TEU range. These sizes of vessels are the backbone of our operations and the primary focus of our new building program. The order book here stands at 6.8% as of May 24, 2024.
Speaker Change: These sizes of vessels or the basketball of operations and the primary focus of our new building program.
Speaker Change: The order book here stands at six 8% as of May 'twenty, four 'twenty 'twenty four.
Aristides J. Pittas: According to Clarkson's, new deliveries are projected to be approximately 8% this year, 1.9% in 2025, and 0.7% in 2026 and beyond, suggesting that after 2024, we will have minimal deliveries in 2025 and 2026. With over 50% of the fleet being over 15 years old, these favorable fundamentals suggest an anticipated reduction in fleet size in the coming years. Let's move to slide 14, where we discuss a route look summary for the Container Ship Mark.
Speaker Change: According to Clarksons, new deliveries are projected to be approximately 8%. This year, one 9% in 'twenty four 'twenty, five and 0.7% in 2026 and beyond.
Speaker Change: Suggesting that after 2024.
Speaker Change: We'll have minimal deliveries in 2025 and 2026.
Speaker Change: With over 50% of the fleet being over 15 years old. These favorable fundamentals suggest an anticipated reduction in fleet size in the coming years.
Speaker Change: Let's move to slide 14, where we'll discuss our outlook summary for the containership market.
Speaker Change: The container shipping markets have significantly strengthened since launch last December and due to the voting of vessels away from the Red Sea and the Gulf of Aden.
Aristides J. Pittas: The container shipping markets have significantly strengthened since last December due to the rerouting of vessels away from the Red Sea and the Gulf of Aden. The rerouting has had a substantial impact on the supply-demand balance, as moored vessels on affected east-west services are now taking longer alternative routes. Consequently, demand for ships has increased, boosting fleet utilization by more than 10%. Freight rates have surged, and charter rates have significantly risen and continue to climb, indicating a halt to the previous softening trend, at least for now. The Context Index has increased by 73% since December 21st.
Speaker Change: The rerouting has had a substantial impact on the supply demand balance is remote vessels are unaffected east West services are now taking longer alternative routes. Consequently demand for ships has increased boosting fleet utilization by more than 10%.
Speaker Change: Rates have served.
Speaker Change: Served and charter rates have significantly risen and continue to climb.
Speaker Change: Indicating a horse to the previous softening trend at least for now.
Speaker Change: The context index has increased by 73% since December 25.
Aristides J. Pittas: For the remainder of 2024, we anticipate a strong market to continue until geopolitical issues cease. However, the substantial new vessel supply is expected to gradually take over and lead to lower rates. Despite this, the potential risk of a full closure of the Strait of Hormuz, although it has minimal impact on containers, and the ongoing disruption in the Suez Canal and the Red Sea continue to affect vessel activity and the shipping market. The Red Sea security crisis shows no signs of resolution, and the Israel-Iran crisis could further exasperate the situation.
Speaker Change: For the remainder of 2024, and we anticipate the strong market to continue and filter a political issue fees.
Speaker Change: However, the substantial new vessel supply is expected to gradually take over and lead to lower rates.
Speaker Change: Despite this the potential risk of a full closure of the Strait of Hormuz, although it has minimal impact on containers and the ongoing disruption in distress and Alan that wed see continued to affect the vessel activity in the shipping buckets.
Speaker Change: The Red Sea security crisis shows no signs of it there was a news.
Speaker Change: And the Israeli Iran crisis could further exacerbate the situation.
Speaker Change: Even geopolitical tensions ease we anticipating we anticipate the softening in container freight inside the markets there.
Aristides J. Pittas: If geopolitical tensions ease, we anticipate a softening in container freight and charter markets driven by the accelerated capacity growth. Conversely, if these tensions persist, the extended period of vessel rerouting would support higher chatter rates. Looking ahead to 2025, if geopolitical issues are resolved, supply and demand fundamentals would likely lead to a softening of the markets. The extent of this softening will depend on the development of the geopolitical situation, but if conditions normalize, the significant fleet expansion could result in a substantial decline.
Speaker Change: Given by the accelerated capacity growth.
Speaker Change: Firstly, if these potential spaces extended period, the vessel to be looting, which are both higher charter rates.
Speaker Change: Looking ahead to 2025 with geopolitical issues are resolved supply and demand fundamentals would likely lead to softening of the market.
Speaker Change: The extent of this shelf spending will depend on the development of the geopolitical situation, but if conditions normalize the significant fleet expansion could result in a substantial decline.
Aristides J. Pittas: In any event, market conditions will remain challenging, market performance will be sensitive to capacity management, vessel speeds, and various inefficiencies such as congestion that could alleviate some of the pressure. Also, the energy transition has continued to gain momentum in the containership sector. Whilst it is evident that a shift is taking place, the long-term outcome remains uncertain. One thing is sure though, the spread between chatter rates achieved by echo vessels will increase further as chatters become more sensitive to green air transfer topics. Let's move to slide 15. The left chart shows the evolution of one-year time charter rates for containers with a capacity of 2,500 P.U. Since 2013,
Speaker Change: In any event market conditions remain challenging market performance will be sensitive to capacity management vessel speeds and values and efficiencies such as congestion that that could alleviate some of the pressure.
Speaker Change: Also the energy transition has continued to gain momentum in the containership sector.
Speaker Change: While it is evident that the shift is taking place the long term outcome remains uncertain. One thing is true of the the spread between charter rates achieved by the eco vessels will increase further.
Speaker Change: Cause us to become more sensitive given the transport options.
Speaker Change: Well, let's move to slide 15.
Speaker Change: The left shows the evolution of one year time charter rates to containers with a capacity of two and a half thousand Teu since 2015.
Speaker Change: One year time charter rates are far below the peak in early 'twenty, two but as previously mentioned.
Aristides J. Pittas: One-year time charter rates are far below their peak in early 2022 but, as previously mentioned, have earned back lost ground to stand at $19,500 per day, above the historical average and median rate. The right-hand chart illustrates the historical range for new-build and 10-year-old second-hand containers, each with a capacity of two and a half thousand tees. Recent data shows a rebound from year-end prices, with values still remaining significantly higher than both the historical average and the median level.
Speaker Change: Back lost ground to stand at 19, and the $5000 per day above.
Speaker Change: Above historical levels and median debates.
The right hand chart illustrates the historical range for new buildings, and 10 year old second hand container ships with a capacity of two and a half thousand Teu.
Speaker Change: Recent data shows the rebound from year end prices with value still remaining significant higher than both the historical levels of median levels.
Speaker Change: New building prices for containers of this size currently stand at $41 25 million was the historical average median price for new buildings of this size for the last 10 years is 33, seven and 51 $5 million respectively.
Aristides J. Pittas: New building prices for containers of this size currently stand at $41.25 million, whilst the historical average on the median price for new buildings of this size for the last 10 years is $33.7 and $31.5 million, respectively. For 10-year-old second-hand vessels of this size, prices currently stand at around $23 million, while the respective historical average of median prices is approximately $17 million and $13 million, respectively. Given these persistently elevated prices, we are hesitant to pursue further acquisitions unless they can be paired with charters that will reduce residual values at expiration to below the historical mean. And with that, I will pass the floor to our CFO, Tassos.
Speaker Change: For the 10 year old second hand vessels of this size prices currently stands at around $33 million, while their respective historical average or median prices of approximately $17 million.
Speaker Change: $13 million respectively.
Given these persistently elevated prices, we are hesitant to pursue further acquisitions unless they can be paired with charters that will reduce residual values of exploration to below the historical median.
Speaker Change: And with that I will pass the floor to our CFO taxes to go over our financial highlights in further detail.
Anastasios Aslidis: Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen.
Speaker Change: Thank you very much good morning from me as well, ladies and gentlemen.
Anastasios Aslidis: Over the next four slides, I will give you an overview of our financial highlights for the first quarter of 2024 and compare those results to the same period last year. To do that, let's turn to slide 17. For the first quarter of 2024, the company reported total net revenues of $46.7 million, representing an 11% increase over total net revenues of $41.9 million during the first quarter of 2023. We reported a net income for the period of $20 million, as compared to a net income of $28.8 million for the first quarter of last year.
CFO taxes: Over the next four slides I will give you an overview of our financial highlights for the first quarter of 2024 and compare results to the same period of last year.
Speaker Change: Provoke let's turn to slide 17.
Speaker Change: For the first quarter of 2024, the company reported total net revenues of $46 7 million, representing an 11% increase over total net revenues of $41 9 million during the first quarter of 2020.
Speaker Change: We reported net income for the period of $20 million as compared to a net income of 28 8 million for the first quarter of last year.
Speaker Change: Interest and other financing costs for the first quarter of 2024 amounted to $3 2 million as compared to interest and other financing cost of 2 million for the same period of 2023.
Anastasios Aslidis: Interest and other financing costs for the first quarter of 2024 amounted to $3.2 million as compared to interest and other financing costs of $2 million for the same period of 2023. This increase is due to the increased amount of debt we carry and the increase in the SOFR rates of our bank rates in the current period as compared to the same period of last year.
Speaker Change: This increase is due to the increased amount of debt that we carry.
Speaker Change: The increase in the sulfur grades.
Speaker Change: Bank rate in the current period as compared to the same period of last year.
Speaker Change: In the first quarter of 2024 are in those figures are used by the capitalized imputed interest of $1 4 million and due to the self financing of the pre delivery payments for our new building program.
Anastasios Aslidis: In the first quarter of 2024, our interest figures are reduced by the capitalized imputed interest of 1.4 million earned due to the self-financing of the pre-delivery payments for our new building program, as compared to 1.1 million of imputed interest during the same period of last year. Finally, interest income in the first quarter of this year amounted to $0.55 million compared to $0.23 million in the same period of 2020. Adjusted TB data for the first quarter of 2024 was 24.6 million compared to 26 million achieved in the same period last year.
Speaker Change: As compared to $1 1 million of <unk> during the same period of last year.
Speaker Change: Finally interest income in the first quarter of this year amounted to <unk>.
Speaker Change: 55 million compared to 23 million for the.
Speaker Change: The same period of 2023.
Speaker Change: Adjusted EBITDA for the first quarter of 2024 was $24 6 million compared to 26 million achieved in the same period of last year.
Speaker Change: Basic and diluted earnings per share for the first quarter of this year were $2 99, and $2.87 respectively culture.
Anastasios Aslidis: Basic and diluted earnings per share for the first quarter of this year were $2.89 and $2.87 respectively, calculated on approximately 6.9 million basic and 7 million diluted weighted average number of shares outstanding, compared to basic and diluted earnings per share of $4.11 and $4.10 for the first quarter of 2023, calculated in turn on approximately 7 million basic and diluted weighted average number of shares outstanding, excluding the effect on the income for the quarter, of the Unrealized Loss or Gain on Derivatives, the amortization of below market time charters acquired, The depreciation charged due to the increased value of vessels acquired with below-market time charters and for the first quarter of 2023, the gain on a sale of a vessel. The adjusted earnings per share for the quarter ended March 31st, 2024 would have been $2.67 and $2.66, respectively for the first quarter of 2023. Usually, security analysts do not include the above items in their published estimates of fairness per se.
Speaker Change: Calculated on approximately $6 9 million basic and 7 million diluted weight weighted average number of shares outstanding compared to basic and diluted earnings per share or $4 11.
And $4.10 for the first quarter of 2023.
Speaker Change: Later ill turn on approximately 7 million basic and diluted weighted average number of shares outstanding.
Speaker Change: Excluding the effect on the income for the quarter.
Speaker Change: The unrealized loss or gain on derivatives.
Speaker Change: Amortization of below market time charter supplier.
Speaker Change: Depreciation charge due to the increased value of vessels acquired with below market price.
Speaker Change: Charters and for the first quarter of 10 23, the gain on a sale of a vessel.
Speaker Change: The adjusted earnings per share for the quarter ended March 31st 2024 would have been $2 67 and $2.66.
Speaker Change: Yeah, sure basic or diluted respectively compared to adjusted earnings of $8, a ton said I'm sorry.
Speaker Change: Nine cents per share basic and diluted.
Speaker Change: And respectively for the first quarter of 2023.
Speaker Change: Usually secured candidate does not include the above items in their published estimates of earnings per share.
Anastasios Aslidis: I would like to mention here that during the first quarter of 2024, we had three dry dockings, two of which included, as Aristides mentioned, retrofits in order to improve the carbon footprint and future airing capacity of the vessels; these dry dockings resulted in increased dry docking expenses for the period and a loss of proportionally more revenue days as compared to either the first quarter of last year or the previous quarter. These investments obviously influenced our earnings per share this quarter but will be reversed in subsequent periods. Let's now move to slide 18 to review our fleet performance. We will start our review by first examining the utilization rates during the first quarter of this year as compared to the previous year.
Speaker Change #100: I would like to mention here that during the first quarter of 2024.
Speaker Change #101: Thank God Kings two of which included Src was mentioned retrofits in order to improve the carbon footprint and future, earning capacity of the vessels that these dry docks and resulted in increased drydocking expenses for the period and loss of proportionally more and having that.
Speaker Change #101: As compared to in the first quarter of last year or the previous quarter.
Speaker Change #101: This investment in from last obviously, our earnings this quarter, but will be reverse in subsequent periods.
Speaker Change #101: Let's now move to slide 18 to review our fleet performance.
Speaker Change #101: We will start our review by first examining their utilization rates.
Speaker Change #101: During the first quarter of this year as compared to the previous year.
Speaker Change #101: As usual our fleet utilization rate is broken down into commercial and operational.
Anastasios Aslidis: As usual, our criticalization rate is broken down into commercial and operational. During the first quarter of 2024, our commercial utilization rate was 99.8%, while our operational utilization rate was 99.9%, compared to 98.1% commercial and 97.6% operational for the first quarter of last year. 19.6 vessels were owned and operated during the first quarter of 2024, earning an average time charter equivalent rate of $27,806 per vessel, compared to 17.1 vessels in the same period of 2023, earning on average $29,231 per day.
Speaker Change #102: During the first quarter of 2024 hour Comercio utilization rate was 99, 8%, while our operational utilization rate was 99, 9% compared to 98, 1% commercial and 97, 6% operational for the first quarter of last year.
Speaker Change #102: On average 19, six vessels were owned and operated during the first quarter of 2024, adding an average time charter equivalent rate of $27806 per vessel.
Speaker Change #102: Compared to $17 one vessel in the same period of 2023.
Speaker Change #102: And on average.
Speaker Change #103: 29000 to Camden $31 per day.
Speaker Change #103: Our total daily operating expenses.
Anastasios Aslidis: Our total daily operating expenses, including management fees, G&A expenses, but excluding dry docking costs, were $7,963 per vessel per day for the first quarter of this year, compared to $8,074 per vessel per day for the first quarter of 2023. If we include our interest expenses, dry docking expenses, and loan repayments, our cash flow break-even rate per day during the first quarter of 2024 was $17,171 per day versus $14,000 and $160 during the first quarter of last year, the difference being due, as I mentioned earlier, to the increased dietary expenses during the quarter.
Speaker Change #103: Including management fees G&A expenses, but excluding drydocking costs were $7963 per vessel per day for the first quarter of this year compared to $8074 per vessel per day for the first quarter of 2023.
Speaker Change #104: If we include our interest expenses Diebold can expansion laundry payments, our cash flow breakeven.
Alright per day during the first quarter of 'twenty, 'twenty, four or 17000 tons.
Speaker Change #104: And $71 per day versus 14000.
Speaker Change #104: $160 during the first quarter of last year, the difference being <unk> as I mentioned earlier to the increase in territories can expenses during the quarter.
Speaker Change #104: Finally, if you will.
Anastasios Aslidis: Finally, if we look at the very last line of this slide, we can see the common dividend expressed in dollars per day per vessel that we paid in the two periods. For the first quarter of 2024, that amounted to about $2,328 per vessel per day, while for the same period of last year it amounted to $2,271 per vessel.
Speaker Change #104: At the very last line of this slide we can see the common dividend expressing.
Speaker Change #104: Dollars per day per vessel that we paid and we paid in the two periods for the first quarter of 'twenty 'twenty four but.
I wanted to about $2228 per vessel per day.
Speaker Change #104: For the same period of last year, it amounted to 2000 and $271 per vessel per day.
Speaker Change #105: Let's now move to slide 19 to review our debt profile and our forward cash flow breakeven 11.
Anastasios Aslidis: Let's now move to slide 19 to review our debt profile and our forward cash flow breakeven level. As of March 31st, 2024, our total debt amounted to approximately $148.6 million. The chart at the top left of the slide displays our current debt repayment schedule for the next four years.
Speaker Change #106: Especially on March 31st 2024 hour total total debt amounted to approximately $148 6 million.
Speaker Change #107: The chart at the highest over the top or at the top left I'm, sorry, well the slide displays our calling card in the debt repayment schedule for the next four years.
Anastasios Aslidis: As you can see, in 2024, we made loan repayments totaling $9.4 million in the first quarter of this year, and we expect to make an additional $25.7 million in the remainder of the year, for a total of about $35 million. In 2025, our projected loan payments are around $19.9 million, along with balloon payments of $17.6 million, while in 2026, our loan repayments are expected to amount to about $13 million with no balloon payments due.
As you can see in 'twenty 'twenty, four we make loan payments totaling $9 4 million in the first quarter of this year and we expect to make an additional $25 7 million in the remaining of the year for a total of about $75 million.
Speaker Change #107: In 2025, our projected long payments are around $19 9 million, along with balloon payments of $17 6 million.
Speaker Change #107: Why in 2026 alone or payments are expected to amount to.
$13 million with no balloon payments due.
Please note that these figures include any payments from the two loans that we drew in the second quarter of 2024 to partly finance the acquisition of our initial deliveries.
Anastasios Aslidis: Please note that these figures include repayments from the two loans we drew in the second quarter of 2024 to partly finance the acquisition of our recent deliveries, Leonidas Z. and Monica, from our new building project. They do not include repayments for approximately another 100 million of debt we expect to assume to partly finance the next four remaining new buildings from our new building program.
Speaker Change #108: NEVA Z and Monica well from our new building program.
Speaker Change #109: They do not include any payments for an approximately another 100 million of debt, we expect to assume to partly finance.
Speaker Change #109: The next four remaining new buildings from our new building program.
Speaker Change #109: A few words now regarding the cost of our debt as of the end of the last quarter.
Anastasios Aslidis: A few words now regarding the cost of our debt as of the end of the last quarter. The average margin was 2.29%, and assuming a software rate of around 5.31%, the cost of our senior debt as of March 31st was approximately 7.6%. If we further include the savings from certain interest rate swaps we have for a portion of our debt...
Speaker Change #109: The average margin.
Speaker Change #109: Was $22, 29% and assuming a software write off around 530.
Speaker Change #109: 31% the cost profile of our senior debt as of March 31st was approximately seven 6%.
If we further include the savings from certain interest rate swaps that we have for a portion of our debt.
Anastasios Aslidis: The overall cost of our debt is reduced to about 7.34% as approximately 13% of our debt carries a base off rate of around 3.4%. I would like to draw your attention now to the bottom of this slide, where we present the level and components of our expected cash flow breakeven for the next 12 months and show various cash flow breakeven levels. First, our EBWA given level is $7,645 per vessel per day.
Speaker Change #109: Overall cost of our debt is reduced to about 734% approximately 13% of our debt cash base of shelf rate of around three 4%.
Speaker Change #109: I would like to draw your attention now to the bottom of this slide where we present the level in components of our expected cash flow breakeven for the next 12 months and so buyers.
Speaker Change #109: Cash flow break even levels.
Speaker Change #109: Our EBITDA breakeven level is $7645 per vessel per day.
Speaker Change #109: Even though we are to that interest.
Speaker Change #109: Expenses and loan repayments.
Speaker Change #109: Overall projected breakeven level over the next 12 months is expected to be around $13653 per vessel per day.
Anastasios Aslidis: If we add to that interest, expenses, and loan repayments, our overall projected breakeven level over the next 12 months is expected to be around $13,653 per vessel per day. Now, let's wrap up our presentation of the financial figures by moving to the next slide, slide 20, to review some highlights from our balance.
Speaker Change #110: So let's sum up on our.
Presentation of the financial figures by moving when the next slide Slide 20 to review some highlights from our balance sheet.
Speaker Change #110: Our assets mainly include cross another acquired Hartford's advances for vessels under construction.
Anastasios Aslidis: Our assets mainly include cash and other current assets, advances for our vessels under construction, and, of course, our vessels in the water and their book value. As of March 31st, 2024, we had cash and other current assets amounting to about $70.2 million. Advances that we paid for our new building program of about $87.7 million and vessels with a book value of around $308 million, resulting in a total book value for our assets of about $466 million.
Speaker Change #110: And of course, our vessels in the water or their book value.
Speaker Change #111: As of March 31st Spring 'twenty, four we had cash and other current assets amounting to about 72 million.
Speaker Change #111: Advances that we paid for our new building program of about $87 7 million and vessels with a book value of around $608 million, resulting net total book value for all of our assets well for about 300, sorry 466 million.
On the liability side, our debt as I mentioned as of March 31st stood at $148 6 million, which is.
Anastasios Aslidis: On the liability side, our debt, as I mentioned, as of March 31, stood at $148.6 million, which represents approximately 32% of the book value of our assets. We had other liabilities, like the fair value for below-market, acquired charters representing about 1.4% of our assets and other liabilities totaling about $20.4 million or $4.4 of our total assets, resulting in a net book value for our shareholders of about $291 million or about $41 per share.
Represents approximately 32% of the book value of our assets.
We have also other liabilities like the fair value of our below market.
Speaker Change #111: Acquired charters represented about one 4% of our assets and other liabilities totaling about 24 million $4 four of our total assets.
Speaker Change #112: And he's already in a net book value for our shareholders of about $291 million or about $41 per se.
Anastasios Aslidis: However, I think it is important to highlight here that the market value of our fleet significantly exceeds its book value. We estimate that the charter-adjusted value of our fleet... to be in the range of 390 to 395 million, which translates to a net asset value for the company of 385 to 390 million, or around $54 to $55 per share. Our closing price yesterday was just under $37, a level at a significant discount to RNAV and thus representing a considerable appreciation potential for shareholders and investors. With that, I'd like to turn the floor back to Aristides to continue the call.
Speaker Change #112: However, I think it's important to highlight here that the market value of our fleet significantly exceed exceeds its book value.
Speaker Change #112: We estimate the charter attached.
Value of our fleet.
Speaker Change #112: To being their age of $390 million to $95 million, which translates to a net asset value for the company of $85 million to $390 million or our island.
Speaker Change #112: 44, 54% to $55 per share.
Speaker Change #112: Our closing price yesterday was just under $37.
Speaker Change #112: 11 at a significant discount to our Navy.
Speaker Change #112: And Vas.
Speaker Change #112: Presenting.
Speaker Change #113: Therefore appreciation potential.
Speaker Change #114: Our shareholders and investors without I'd like to turn the floor back to our intent is to continue the call.
Doug: Thank you Doug So let us now open up the floor for any questions.
Aristides J. Pittas: Thank you, Tasso. Let us now open up the floor to any questions.
Operator: Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we poll for questions. Our first question is from Tate Sullivan with Maxim Group. Please proceed.
Doug: Thank you.
Speaker Change #116: To ask a question please press star one.
Speaker Change #117: A confirmation tone will indicate your line is in the question queue.
Doug So: Press Star two if he would like to remove your question from the queue.
Speaker Change #119: Participants using speaker equipment, it may be necessary to pick up your hand.
Speaker Change #119: Before pressing the star keys.
Speaker Change #120: I'll start questions.
Speaker Change #121: Our first question is from Tate Sullivan with Maxim Group. Please proceed.
Tate H. Sullivan: Hello, thank you. Good day.
Speaker Change #122: Hello, Thank you and good day.
Tate H. Sullivan: With our cash commitments for the new builds yet to be delivered in the two that were already delivered this quarter you said you're adding.
Tate H. Sullivan: Starting with the cash commitments for the new builds yet to be delivered and the two that were already delivered this quarter, you said you're adding $100 million, I think I heard, in debt to finance those new builds. What's the remaining new build commitment or the payment schedule? The remaining, I think, I can make a quick estimate. I believe we have paid about $87 million, roughly about $20 million. I can get you a more exact number, but I think roughly about $20 million would be the equity committee.
Speaker Change #124: <unk> million dollars I think I heard in debt to finance, the remaining newbuild commitments or the payment schedule.
Speaker Change #125: The remaining <unk>.
Speaker Change #126: Yeah, I think I can make a quick estimate I believe we have.
Speaker Change #127: We have paid about 87, therefore, I think we've been asked me about 20 million I can get you in a more exact number but I think roughly about 20 million would be the equity commitment.
Aristides J. Pittas: Okay, so a total of 120. Okay. Okay. Thank you.
Speaker Change #128: Okay. So a total of 120, okay. Okay. Thank you.
Speaker Change #127: And then for the.
Speaker Change #127: Contracting.
Aristides J. Pittas: And then for the contracting, the new builds, and then since you have already contracted the Monica for $16,000, and then can you talk about the Stephania K? What do you still expect to get before the end of the quarter? Should we expect a similar new build rate? Or if you decide to go longer term, could it be lower than that $16,000 daily rate?
Speaker Change #129: The new builds and then since you already you contracted the moniker already for 16000, and then can you talk about this stuff.
Speaker Change #130: When do you still expect to get that before the end of the quarter should we expect a similar new build rate.
Speaker Change #130: Or you could decide to go longer term could it be lower than that 16000 daily rate.
Speaker Change #131: I think that we will be able to fix something which is.
Aristides J. Pittas: I think that we will be able to fix something which is very similar to this level. We would like to fix it in around a year's time. We will see. We are talking with some charters and... We will know relatively soon.
Speaker Change #131: Very similar to this level.
Speaker Change #131: No.
Speaker Change #132: We would like to fix a year's time, we will see we are talking with some charters and.
Speaker Change #133: We will know relatively soon.
Speaker Change #134: And just logistically you start to get paid on the contracts for new builds right when they exit upon exiting the shipyard is that correct.
Aristides J. Pittas: And just logistically, you start to get paid on the contracts for new builds right when they leave upon exiting the shipyard. Is that correct? Based on your previous experience. Okay. And then toss this for the financing for the new builds. Thank you, Aristides.
Speaker Change #134: Okay.
Speaker Change #135: And then for the financing for the Newbuild.
Speaker Change #136: Will you secure the financing upon delivery or do you will you get financing for the installment payments for the remaining how how do you manage that.
Anastasios Aslidis: Will you secure the financing upon delivery, or will you get financing?
Anastasios Aslidis: We finance, we pay the installment payments ourselves, and we arrange delivery finances. Usually, we arrange the financing of the vessels at delivery a month or more in advance. For example, the next two vessels... that we expected delivery of are already financed, as we announced already. The last two, we haven't completed our financing arrangements yet.
Speaker Change #137: We financed we pay the installment payments ourselves and we we are age delivery financing.
Speaker Change #138: We are in the financing for the vessels that deliver a mouthful or more in advance for jumbo next two vessels.
Speaker Change #138: We expect to take delivery of our led to finance, because we announced already the last two.
Speaker Change #139: Having completed our financing arrangements yet.
Speaker Change #138: Okay.
Tate H. Sullivan: Excellent. Well, thank you very much.
Speaker Change #140: Excellent well, thank you very much.
Operator: Thank you, Tate. As a reminder...
Speaker Change #141: Thank you. Thank you.
Speaker Change #142: As a reminder, star one on your telephone keypad.
Operator: As a reminder, it is star one on your telephone keypad if you would like to ask a question. Our next question is from... Kristoffer Skeie with Arctic Securities. Please proceed.
Good question.
Speaker Change #143: Our next question is from.
Christopher ski with IDEXX.
Speaker Change #144: Please proceed.
Kristoffer Barth Skeie: Good morning, how are you.
Speaker Change #146: Good morning, and thank you.
Kristoffer Barth Skeie: Good morning, we're fine. Thank you.
Kristoffer Barth Skeie: Thank you for taking my questions I was wondering if you could provide some.
Kristoffer Barth Skeie: Thank you for taking my questions. I was wondering if you could provide some more color on the ongoing charter discussion with regard to the open vessel days in 1925 and 1926. Are you seeing a lot of interest in forward fixing by liners? And with regard to that, has the duration of these discussions changed in recent months? Are we seeing some sort of appetite for longer charters now that spot rates have bounced back? Yes, and we...
Speaker Change #147: Color on more.
Speaker Change #148: More color on the ongoing discussion.
Speaker Change #149: Well the open muscle ache and something positive on that.
Oh, you're seeing lots of interest both cohorts ticketing by liners.
Speaker Change #149: Hum.
Speaker Change #149: Hum.
Speaker Change #150: These discussions changed in recent months are you seeing.
Speaker Change #151: All along at chalk bluffs, Oh, that's right yeah.
Speaker Change #152: Bounce back.
Speaker Change #152: Thanks.
Yes.
Aristides J. Pittas: Yes, we currently don't have many ships opening up soon other than this new building vessel that will take delivery in about a month and a half. So there's not too much to fix at this point. The market, though, is definitely improving. We've seen that we fixed our 2,800 T.E.U. Ships at around $20,000 a day about a month ago for two years, and now we've seen similar ships being fixed at $25,000 a day.
Speaker Change #153: We currently don't have a many ships opening up.
Speaker Change #153: Sean.
Speaker Change #153: Other than this new building vessels that will take delivery in about a month from the half time.
Speaker Change #153: So there's not too much to fix at this point the market, though is definitely improving.
Speaker Change #153: We've seen that we fixed the 2800 P U shape.
Sean: I've got around $20000, a day about a month ago for two years and now we've seen stimulus seems to being fixed for $25000. A day. So the market is firming up and periods available and can be seen.
Aristides J. Pittas: So the market is firming up. Periods available are increasing, and there is a continuous increase in the market. How long this will continue is very difficult to say. The liners would fix ships that open up within the next couple of months, but they wouldn't offer anything really competitive for ships opening up six months from today, and therefore, we're not really active in trying to find something today.
And there is a continuous increase and good luck with how long. This continues is it very difficult to say.
Sean: Yeah.
Sean: The liners will fix ships that open up within the next couple of months, but they're not they wouldn't offer anything really competitive four ships opening up six months from today and.
Speaker Change #155: Therefore, we will not really active in trying to find something today.
Speaker Change #156: Okay. Thanks.
Speaker Change #156: Thanks.
Speaker Change #157: And our next question is Tate Sullivan with Maxim Group. Please proceed.
Tate H. Sullivan: And our next question is Tate Sullivan with Maxim Group. Please proceed.
Tate H. Sullivan: A follow-up, sorry, thank you. You announced the sale of Astoria in April for $10 million. The 20F indicated a cost of the repairing value of $3.95. Did that change, or are there other considerations for the implied gain on that sale for this current quarter?
Speaker Change #159: A follow up sorry, Thank you you announced the sale of the story.
Speaker Change #158: So that $10 million.
Speaker Change #158: The 20-F, indicating a constant.
Speaker Change #160: <unk> value of $3 95 did that change are there other considerations for the implied gain.
Speaker Change #161: Net sales for this current quarter.
Aristides J. Pittas: I think that would be, that's correct, the difference between the two minus commission expenses or whatever would be the implied capital gain on sales. Walker. All right.
Speaker Change #162: I think that it would be that that's correct.
Speaker Change #163: Of the two.
Speaker Change #163: Minus commission expenses or whatever would be the implied capital gain.
Speaker Change #163: What I'm, saying.
Tate H. Sullivan: Okay, all right. Thank you.
Speaker Change #164: Alright, thank you.
Speaker Change #163: Sure.
Speaker Change #165: As a reminder, this star one on your telephone.
Operator: As a reminder, this is Star 1 on your telephone keypad. If you would like to ask a question, we will pause for a brief moment to see if there are any follow-up questions. Okay, and we do have a follow-up from Kristoffer with Arctic Securities. Please proceed.
Speaker Change #165: Keypad.
I would like to ask a question for.
Speaker Change #165: For a brief moment to see if there's any.
Speaker Change #165: Questions.
Speaker Change #165: Okay.
Speaker Change #165: Okay.
Speaker Change #166: That's from Christopher.
Christopher: Please proceed.
Christopher: Hey, How're you doing.
Kristoffer Barth Skeie: Hi again. You can just comment on what you're seeing in terms of..., previously mentioned, are you considering reducing exposure or reducing your feed by divesting the whole vessel?
Christopher: Comment on what you're seeing in terms of.
Christopher: Yeah.
Speaker Change #168: The interest on it.
Speaker Change #169: Well, that's some divestments I mean this is all.
Speaker Change #170: The woman.
Speaker Change #171: Oh yeah.
Speaker Change #172: And as he mentioned.
Speaker Change #172: Are you doing to you would you.
Speaker Change #173: I also hope exposure or reduce your feet by divesting older vessel.
Speaker Change #174: We are considering.
Aristides J. Pittas: We, we are...
Aristides J. Pittas: We are considering what to do with the Elder Vessels as the charters expire, and we haven't taken any decisions yet, but, of course, the Elder Vessels, which we initially thought that we would be needing to scrap at the end of the lucrative charters that we had secured for all of them. Today the market is better, so we are considering the options that we have of reselling them or keeping them and rechartering them, and we will develop our strategy as things move on.
Speaker Change #174: We are considering oh.
Well guess what to do with the with the added go to vessels as the charters expire.
And we haven't taken any any decisions, yet, but oh of course.
Speaker Change #174: The elder vessels, which initially we thought that we would be neat thing to scrap at the end of the.
Speaker Change #174: These charters that we had secured for all of them.
Today the market is better. So we are considering the options that we have globally selling them or keeping them under the chartering them and we will.
Speaker Change #174: Develop io strategy as things move on.
Speaker Change #174: Okay.
Speaker Change #174: Okay.
Kristoffer Barth Skeie: Okay, good. And in terms of useful life, what do you see as a sort of typical useful life for these vessels now?
Speaker Change #174: That is all the useful lives.
Speaker Change #174: Yes.
Speaker Change #174: Typical useful life on these vessels.
Speaker Change #175: Well technically even though we have the issues with the C. I N D X XI and all of these new requirements that clinically the ships can still easily last till the 25th year.
Aristides J. Pittas: Well, technically, even though we have the issues with the CII and the EXI and all these new requirements, technically, the ships can still easily last till the 25th year. And by sailing at a little bit slower speeds, they do satisfy the requirements. So it's more of a commercial decision to decide what to do with them, rather than a technical decision. That means that if charter rates are satisfactory, we can easily keep them for longer.
Speaker Change #175: And by sailing at the little bit slower speeds.
Speaker Change #175: Do satisfy that requirement. So it's more of a commercial decision to decide what to do with them rather than the technical decision. So if that means that the.
Speaker Change #175: Charter rates are you know are satisfactory, we can easily keep them for longer.
Speaker Change #176: Okay. Okay.
Kristoffer Barth Skeie: That's going to do it for my day.
Speaker Change #176: That's been consistent.
Speaker Change #176: Thanks.
Aristides J. Pittas: We have reached the end of our question and answer session. I would like to turn the conference back over to Mr. Pittas for closing remarks.
Speaker Change #177: We have reached the end of our question and answer session I would like to turn the conference back over to Mr. Peter <unk>.
Speaker Change #176: Max.
Aristides J. Pittas: Thank you all for listening to our results for this quarter. We will be back to you in three months' time.
Speaker Change #179: Well. Thank you all for listening in two hours.
Speaker Change #178: Oh the skull.
We'll be back to you in three months time.
Speaker Change #180: Thanks Bye thanks, everybody.
Operator: Thank you. Bye. This will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation. Thanks for watching!
Operator: Thank you. Bye. This will conclude today's conference. You may disconnect.
Speaker Change #181: So I'll conclude today's conference you may disconnect your lines at this time and thank you for your participation.
Speaker Change #181: Yeah.
Speaker Change #181: Yes.
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Operator: Tate Sullivan, Charles Fratt, Aristides Pittas, Climent Molins, Anastasios Aslidis, Kristoffer Skeie, Euroseas Gurdjieff, Anastasios Aslidis, Charles Fratt, Aristides Pittas, Climent Molins, Aristides Tate Sullivan, Charles Fratt, Aristides Pittas, Climent Molins, Anastasios Aslidis, Kristoffer Skeie, Euroseas, [inaudible]
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