Q3 2024 Genco Shipping & Trading Ltd Earnings Call

Good morning, before we begin our presentation I note that in this conference call, we will be making certain forward looking statements pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of 995.

Such forward looking statements use words, such as anticipate budget estimate expect project intend plan believe and other words in terms of similar meaning in connection with a discussion of potential future events circumstances or future operating or financial performance.

Forward looking statements are based on management's current expectations and observations for a discussion of factors that could cause results to differ. Please see the company's press release that was issued yesterday the materials relating to this call posted on the company's website and the company's filings with the Securities and Exchange Commission, including without limitation. The company's annual report on Form 10-K for the year ended December 31.

Speaker Change: 2023, and the Companys reports on Form 10-Q, and form 8-K subsequently filed with the SEC at this time I would like to introduce John Robin Smith, Chief Executive Officer of Genco shipping <unk> trading limited.

Speaker Change: Good morning, everyone welcome to <unk> third quarter 2024 conference call.

Speaker Change: I will begin today's call by reviewing our Q3 2024 and year to date highlights. Additionally, we will provide an update on our value strategy discuss our financial results for the quarter as well as the industry's current fundamentals before opening the call up for questions for additional information. Please also refer to our earnings presentation posted.

Speaker Change: On our website.

Speaker Change: Starting on slide five Q3, 2024 marked another strong quarter for Genco as we continue to advance our value strategy, specifically, we furthered our fleet growth and renewal strategy by acquiring a high quality fuel efficient 2016 built capesize vessel that we properly took delivery of in October this was.

Speaker Change: Our third <unk> acquisition over the last 12 months and importantly, this acquisition is part of <unk> broader fleet renewal strategy earlier in the year, we completed our exit from the from the four smaller and older 169000 deadweight ton vessels and have redeployed the sale proceeds and additional cash.

Speaker Change: Towards the acquisition of three 2016 bulk Capesize ships. These transactions had been accretive to <unk> earnings power as we've added premium high specification assets to the fleet and have also resulted in dry dock capex savings of $13 million in 2024 and 2025.

Speaker Change: Turning to slide six in terms of shareholder returns, we continue to provide sizable dividends to shareholders. We declared a <unk> 40 per share dividend for the quarter, marking a quarter over quarter increase of 18% Importantly, we have now declared 21 consecutive dividends representing $6.

Speaker Change: And 31, five cents per share or 39% of the current share price as of November 5th.

Speaker Change: The strong increase in the third quarter dividend coincides with firm freight rates and follows. Our recent recent decision to enhance our dividend policy and increased cash distributable to shareholders, notably we removed the dry docking cap Capex line item from the calculation for the third quarter. This increase the dividend by 20.

Speaker Change: <unk> per share based on the company's achievements in executing our capital allocation strategy and approaching our goal of net debt zero. We are pleased to take this important step to reward shareholders and further strengthen returns this enhancement to our dividend formula reflects our belief that our low financial leverage.

Speaker Change: <unk> will support larger dividends to shareholders at the same time, we continue to maintain significant financial strength to grow and renew our fleet and further improve our earnings power.

Speaker Change: I, just don't see us doing one off transactions clearly if theres something transformative where.

Speaker Change: There are new capsule Max's are cancer, Max's and we can scale up on the commercial side that will make sense, but just just to buy 123 ships even in a different sector that we don't think that makes a lot of sense and we think we've been.

Speaker Change: <unk>.

Speaker Change: Pretty smart about picking kates as well as as well as the ultra Max's and the barbell approach, it's worked out very well for us.

Speaker Change: It's already joined the fleet. So just for modeling purposes, how long after taking delivery of a vessel does it start generating revenue for genco.

Speaker Change: Okay.

Speaker Change: Yes, so absolutely we took delivery of the Genco Intrepid October 23rd so it was a very prompt delivery, which is terrific do you get the ship on hire during Q4, which is traditionally our peak earnings time.

Speaker Change: Yes. It does it doesn't take very long few days, just familiarization getting crew et cetera. So.

Speaker Change: Welcome to the Conference Center. Please wait for the next available operator.

Speaker Change: Pretty much delivery and then on higher shortly thereafter.

Speaker Change: Okay. Thanks, Peter Peter and Thanks for taking my question.

Speaker Change: Thanks.

Speaker Change: Your next question comes from the line of Ben <expletive> netting this with Clarksons.

Speaker Change: Thank you good morning, guys.

Speaker Change: Good morning.

Speaker Change: So youll have locked in a good time charter rates this quarter or should we view that as sort of an opportunistic one off deal or should we expect a.

Speaker Change: A higher amount of coverage from you guys going forward.

Speaker Change: Thank you for your patience. Please stay on the line for the next available operator.

Speaker Change: I would so yes that.

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Speaker Change: That definitely is a very firm right.

Speaker Change: I would call it opportunistic.

Speaker Change: <unk>.

Speaker Change: We will from time to time, when these opportunities present themselves, particularly.

Speaker Change: Particularly in the Capesize sector, we will.

Speaker Change: From a portfolio approach lock in fixed rate charters as well as the index charters that we've done to date also but.

Speaker Change: But yes, I would I would look at that is.

Speaker Change: A one off opportunity that presented itself and we obviously move quickly on it.

Speaker Change: And that's a bit of.

Speaker Change: Follow up.

Speaker Change: Rates have come off quite a bit.

Speaker Change: You have some.

Speaker Change: Changing fee in terms of geopolitics are you seeing any change in appetite from charterers on term versus spot contracts.

Speaker Change: I think there was a little bit of a pull back and look time charter rates came down with.

Speaker Change: Without rates and the FFA curve and.

Speaker Change: As usual liquidity tends to decrease when you're in a declining rate environment, but again I think sentiment has.

Speaker Change: It has changed over the last week, which again youre seeing in the SFA marketing youre starting to see the the <unk>.

Speaker Change: <unk> market move back up and recover as well so.

Speaker Change: Wood.

Speaker Change: I would think you'd liquidity in the time charter market will move in the same direction upwards.