Q2 2025 Euroseas Ltd Earnings Call
Speaker #2: Thank you for standing by, ladies and gentlemen, and welcome to the EUROSEAS Conference Call on the second quarter 2025 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer and Mr. Anastasios Aslidis, Chief Financial Officer of the company.
Markella Kara: Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Ltd. Conference Call on the second quarter 2025 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer, and Mr. Anastasios Aslidis, 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. Please be reminded that the company announced their results with a press release that has been publicly distributed. Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas Ltd. will be making forward-looking statements.
Speaker #2: 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.
Speaker #2: I must advise you that this conference is being recorded today. Please be reminded that the company announced their results with a press release that has been publicly distributed.
Speaker #2: Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, EUROSEAS will be making forward-looking statements.
Speaker #2: These statements are within the meaning of the Federal Securities Laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risk and uncertainties that may result in such expectations not being realized.
Markella Kara: These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. I kindly draw your attention to slide number two of the webcast presentation, which has the full forward-looking statement, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. Now I would like to pass the floor to Mr. Pittas. Please go ahead, sir.
Speaker #2: I kindly draw your attention to slide number two of the webcast presentation, which has the full forward-looking statement and the same statement was also included in the press release.
Speaker #2: Please take a moment to go through the whole statement and read it. And now, I would like to pass the floor to Mr. Aristides Pittas.
Speaker #2: Please go ahead, sir.
Speaker #3: Thank you. Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me, Anastasios os Aslidis, our Chief Financial Officer.
Aristides Pittas: Thank you. Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me, Anastasios Aslidis, I am Chief Financial Officer. The purpose of today's call is to discuss our financial results for the three and six-month periods ended June 30, 2025. Please turn to slide 3 of the presentation for our quarterly financial highlights. For the second quarter of 2025, we reported total net revenues of $57.2 million and a net income of $29.9 million or $4.29 per diluted share. Adjusted net income for the quarter was $29.2 million or $4.20 per diluted share. Adjusted EBITDA for the period stood at $39.3 million. Please refer to the press release for a reconciliation of adjusted net income and adjusted EBITDA. Our CFO, Dr. Aslidis, will go over our financial highlights in more detail later on in the presentation.
Speaker #3: The purpose of today's call is to discuss our financial results for the three and six-month periods ended June 30th, 2025. Please turn the slides three of the presentation for our quarterly financial highlights.
Speaker #3: For the second quarter of 2025, we reported total net revenues of 57.2 million dollars, and a net income of 29.9 million dollars, or four dollars and twenty-nine cents per diluted share.
Speaker #3: As after the net income for the quarter was 29.2 million dollars, or four dollars and twenty cents per diluted share. Adjusted EBITDA for the period stood at 39.3 million dollars.
Speaker #3: Please refer to the press release for a reconciliation of adjusted net income and adjusted EBITDA. Our CFO, Anastasios Aslidis, will go over our financial highlights in more detail later on in the presentation.
Speaker #3: The company has declared the quarterly dividend of 70 cents per share for the second quarter of 2025, which will be payable on or about September 16th, 2025, to shareholders of record as of September 9th.
Aristides Pittas: The company has declared the quarterly dividend of $0.70 per share for the second quarter of 2025, which will be payable on or about September 16, 2025, to shareholders of record as of September 9. This reflects a $0.05 increase or approximately 7.7% growth in the quarterly dividend payout compared to the $0.65 per share distributed in the first quarter. This highlights our confidence in Euroseas Ltd. operating strength and sustained cash flow generation. At the current rate, the increase to $0.70 per share corresponds to an annualized dividend yield of about 5.5%, which we believe is attractive and competitive within the container ship sector, reflecting our ongoing commitment to deliver value to our shareholders. Based on our charter coverage, we are very confident that our current dividend yield may be maintained comfortably for the next couple of years at least.
Speaker #3: This reflects a five-cent increase, or approximately 7.7 percent growth, in the quarterly dividend payouts compared to the 65 cents per share distributed in the first quarter.
Speaker #3: This highlights our confidence in Euroseas' operating strength and sustained cash flow generation. At the current rate, the increase to $0.70 per share corresponds to an annualized dividend yield of about 5.5 percent.
Speaker #3: Which we believe is attractive and competitive within the container subsector, reflecting our ongoing commitment to deliver value to our shareholders. Based on our charter coverage, we are very confident that our current dividend yield may be maintained comfortably for the next couple of years at least.
Speaker #3: Since initiating our share repurpose plan of up to 20 million dollars in May 2022, we have repurchased 463 thousand shares of a common stock in the open market, for a total of about 10 and a half million dollars.
Aristides Pittas: Since initiating our share repurchase plan of up to $20 million in May 2022, we have repurchased 463,000 shares of our common stock in the open market for a total of about $10.5 million as of August 13, 2025. We will continue to utilize our repurchase program in a disciplined manner as our management team may decide that enhances our long-term shareholder value. Moreover, we are excited to announce the publishing of our 2024 ESG report, which is available on our website under the sustainability section. This is the fifth consecutive year that we publish such a report. We are pleased to say that we feel the whole office is taking pride in our developments on all aspects of ESG, and that the various KPIs we use to monitor our performance are mostly showing positive signs.
Speaker #3: As of August 13, 2025, we will continue to utilize our repurchase program in a disciplined manner, as our management team may decide that it enhances our long-term shareholder value.
Speaker #3: Moreover, we are excited to announce the publishing of our 2024 ESG report, which is available on our website under the Sustainability section. This is the fifth consecutive year that we publish such a report.
Speaker #3: We are pleased to say that we feel the whole office is taking pride in our developments on all aspects of ESG, and that the various KPIs we used to monitor our performance are mostly showing positive signs.
Speaker #3: Please turn to slide four, where we discuss our recent developments, including an update on our savings and purchase chartering and operational highlights. During the quarter, as already announced in May, we agreed to sell our motor vessel Markos V for 50 million, with delivery within October.
Aristides Pittas: Please turn to slide 4, where we discuss our recent developments, including an update on our trades and purchase charting and operation highlights. During the quarter, as already announced in May, we agreed to sell our motor vessel Marcos V for $50 million with delivery within October. While we continue to have faith in the market, the price offered was simply too good to resist. The profits from the sale will thus eventually be used to further renew the fleet with younger vessels. Also, at the start of June, we were able to charter our motor vessel Emanuel P for three years at a highly profitable level of $38,000 per day. On the operation side, there were certain planned repairs for motor vessel Evridiki G and motor vessel EM Corfu, which resulted in off-hire periods of approximately 12.5 and 10 days, respectively.
Speaker #3: Whilst we continue to have faith in the market, the price offered was simply too good to resist. The profits from the sale will thus eventually be used to further renew the fleet with younger vessels.
Speaker #3: Also, at the start of June, we were able to charter our motor vessel Emmanuel P for three years at a highly pressed profitable level of $38,000 per day.
Speaker #3: On the operations side, there were certain planned repairs for motor vessel Evridiki G and motor vessel EM Kofu, which resulted in off-hire periods of approximately 12.5 days and 10 days, respectively.
Speaker #3: This upgrading work was deemed necessary for our two elder vessels, to be able to seamlessly perform the very lucrative charters that we agreed upon during Q1.
Aristides Pittas: This upgrading work was deemed necessary for our two elder vessels to be able to seamlessly perform the very lucrative charters that we agreed upon during Q1. The fleet experienced no other idle periods or commercial off-hire during the quarter. Please turn to slide 5. Here you can see that the company has a fleet of 22 vessels, including 15 feeder container ships and seven intermediate container ships with a cargo capacity of approximately 67,000 TEU and an average age below 13 years. As already disclosed, we expect a delivery of our two intermediate container ship new buildings in the third and fourth quarter of 2027, each with a capacity of 4,300 TEU, which will further increase the size and reduce the average age of our fleet. Please turn to slide 6 for a further update on our fleet employment.
Speaker #3: The fleet experienced no other idle periods or commercial off-hives during the quarter. Please turn to slide five. Here you can see that the company has a fleet of 22 vessels, including 15 feeder container ships and seven intermediate container ships, with a cargo capacity of approximately 67,000 TEU, and an average age below 13 years.
Speaker #3: As already disclosed, we expected delivery of our two intermediate container ship new buildings in the third and fourth quarter of 2027, each with a capacity of 4,300 TEU, which will further increase the size and reduce the average age of our fleet.
Speaker #3: Please turn to slide six for a further update on our fleet employment. We continue to benefit from the strong forward coverage we have achieved.
Aristides Pittas: We continue to benefit from the strong forward coverage we have achieved. For 2025, very close to 100% of the company's available days have already been secured at an average rate of approximately $28,000 per day. Looking ahead into 2026, approximately 67% of our available days have been fixed at an even higher average rate of $31,600 per day. As can be seen on the chart, we only have one vessel opening up for the charter within the year, and we are optimistic that this will be affected at a very satisfactory rate too. Moving on to slide 8, we go over the market highlights in general for the second quarter of 2025. In the second quarter of 2025, one-year time charter rates continued to strengthen during the quarter, supported by limited vessel availability and sustained demand, particularly in the smaller segments.
Speaker #3: For 2025, very close to 100 percent of the company's available days have already been secured at an average rate of approximately 28,000 dollars per day.
Speaker #3: Looking ahead into 2026, approximately 67 percent of our available days have been fixed at an even higher average rate of $31,600 per day.
Speaker #3: As can be seen on the chart, we only have one vessel opening up for charter within the year, and we are optimistic that this will be affected at a very satisfactory rate too.
Speaker #3: Moving on to slide eight, we go over the market highlights in general for the second quarter of 2025. In the second quarter of 2025, one-year time charter rates continued to strengthen during the quarter, supported by limited vessel availability and sustained demand.
Speaker #3: Particularly in the smaller segments, in the feeder segment, rates rose by 8 percent in the second quarter of 2025, compared to the first. Market activity was primarily concentrated on contract extensions, that were concluded at or about prior benchmarks, a trend that carried over into July and has continued through the first week of August.
Aristides Pittas: In the feeder segment, rates rose by 8% in the second quarter of 2025 compared to the first. Market activity was primarily concentrated on contract extensions that were concluded at or above prior benchmarks, a trend that carried over into July and has continued through the first weeks of August. New contracts remain fairly limited, primarily due to lack of vessels. As we move through the second half of 2025, the operating environment remains complex and volatile. Geopolitical tensions and ongoing conflicts continue to disrupt trade patterns, while protectionist measures may create further inefficiencies. These dynamics have reshaped global flows, and the level of uncertainty remains elevated. Consequently, forecasting the market is indeed particularly challenging. The average second-hand price index rose by about 4% in the second quarter of 2025 compared to the first, supported by limited vessel supply and ongoing competition among buyers looking to expand their fleets.
Speaker #3: New contracts remained fairly limited, primarily due to lack of vessels. As we move through the second half of 2025, the operating environment remains complex and volatile.
Speaker #3: Geopolitical tensions and ongoing conflicts continue to disrupt trade patterns, while protectionist measures may create further inefficiencies. These dynamics have reshaped global flows and the level of uncertainty remains elevated.
Speaker #3: Consequently, forecasting the market is indeed particularly challenging. The average second-hand price index rose by about four percent in the second quarter of 2025, compared to the first.
Speaker #3: Supported by limited vessel supply and ongoing competition among buyers looking to expand their fleets, the new building price index remains stable in the second quarter.
Aristides Pittas: The new building price index remains stable in the second quarter. Demand for new buildings remains firm despite heightened market uncertainty stemming from the geopolitical tensions and the threat of even more tariffs. Notably, Korean and Japanese shipyards have begun to command higher pricing relative to their Chinese counterparts, probably due to U.S. trade measures and fees recently imposed on Chinese shipyards. Meanwhile, the idle fleet, excluding vessels under repair, has continued to shrink, standing now at a negligible 150,000 TEU as of the end of July, representing just 0.5% of the global fleet. This marks a significant decline from the peak of 850,000 TEU that was observed in February 2023. In parallel with the strong market, recycling activity also remains subdued, with just eight vessels totaling 4,000 TEU sent for demolition year to date.
Speaker #3: Demand for new buildings remains firm, despite heightened market uncertainty stemming from geopolitical tensions and the threat of even more tariffs. Notably, Korean and Japanese shipyards have begun to command higher pricing relative to their Chinese counterparts.
Speaker #3: Probably due to US trade measures and fees recently imposed on Chinese shipyards. Meanwhile, the idle fleet excluding vessels under repair has continued to shrink, standing now at a negligible 150,000 TEU, as of the end of July, representing just 0.5 percent of the global fleet.
Speaker #3: This marks a significant decline, from the peak of 850 thousand million TEU, that was observed in February 2023. In parallel with a strong market, recycling activity also remains subdued, with just eight vessels totaling 4,000 TEU, sent for demolition here today.
Speaker #3: Scrap prices have reached slightly to 430 dollars per lightweight ton, as of August 8, 2025, in parallel with lower steel prices. Generally, and last, the global container ship fleet has already expanded by 4.1 percent year to date.
Aristides Pittas: Scrap prices have increased slightly to $430 per lightweight ton as of August 8, 2025, in parallel with lower steel prices generally. Last, the global container ship fleet has already expanded by 4.1% year to date. Please turn to slide nine for our broader market overview, focusing on the development of six to 12-month time charter rates over the past 10 years. As illustrated in the graphs on this slide, container ship charter rates extended their upward trajectory through the second quarter of 2025, standing comfortably above their 10-year average and median rates, pinched by constrained vessel availability and sustained demand strength across all segments. Please turn to slide 10. The IMF July 2025 update presents a slightly more resilient global economic outlook than the previous report in 2018, with global trade developments continuing to dominate the forecast developments. The global economy continues to exhibit a stable yet underwhelming growth.
Speaker #3: Please turn to slide nine for our broader market overview, focusing on the development of six- to twelve-month time charter rates over the past ten years.
Speaker #3: As illustrated in the graphs on this slide, container ship charter rates extended their upward trajectory through the second quarter of 2025, standing comfortably above their ten-year average and median rates.
Speaker #3: Underpinched by constrained vessel availability and sustained demand, strength across all segments. Please turn to slide ten. The IMF July 2025 update presents a slightly more resilient global economic outlook than their previous report in April.
Speaker #3: With global trade developments continuing to dominate the forecast developments. The global economy continues to exhibit stable yet underwhelming growth. Global growth, GDP growth, is projected at 3 percent for 2025, and 3.1 percent for 2026, with a 2025 and 2026 projections revised upwards by 0.2 percent and 0.1 percent, respectively, compared to the April 2025 reference forecast.
Aristides Pittas: Global GDP growth is projected at 3% for 2025 and 3.1% for 2026, with the 2025 and 2026 projections revised upwards by 0.2% and 0.1%, respectively, compared to the April 2025 reference forecast. At these levels, the forecasts are below the 2024 outcome of 3.3% global GDP growth and the pre-pandemic historical average of 3.7%. Global policy remains highly uncertain. Transmut tariffs took effect on Tuesday, August 7th, with higher rates for most U.S. trading partners, but some are still to be decided upon. Taken altogether, these tariffs have pushed the average U.S. tariff rate to 15.2% according to Bloomberg Economics, well above the 2.3% last year, and this is the highest level since World War II. The short-term impact of this change, however, will probably not be huge.
Speaker #3: At these levels, the forecasts are below the 2024 outcome of 3.3 percent global GDP growth, and the pre-pandemic historical average of 3.7 percent. Global policy remains highly uncertain, transient tariffs took effect on Tuesday, August 7th, with higher rates for most US trading partners, but some are still to be decided upon.
Speaker #3: Taken all together, these tariffs have pushed the average US tariff rate to 15.2 percent according to Bloomberg Economics, well above the 2.3 percent last year and the highest and this is the highest level since World War II.
Speaker #3: The short-term impact of this change, however, will probably not be huge. The United States economy is projected to grow by 1.9% in 2025 and accelerate slightly to 2% in 2026, according to the IMF.
Aristides Pittas: The United States economy is projected to grow by 1.9% in 2025 and accelerate slightly to 2% in 2026, according to the IMF. U.S. growth forecasts were revised upwards due to the easing trade tensions, improved financial conditions, the weaker dollar, and the recent tax incentives aimed at stimulated business investment and consumer spending. In Europe, GDP accelerated, driven by investment and net exports. Growth in the area is now predicted at 1% for 2025, up 0.2% from eight-week projections. However, many European countries continue to face subdued domestic demand, manufacturing weakness, and the lingering effects of the energy shock. Global inflation is expected to continue declining, with headline inflation projected to fall to 4.2% in 2025 and 3.6% in 2026. In the euro area, inflation has gone down significantly, but in the U.S., it is still elevated as unemployment rate remains low.
Speaker #3: US growth forecasts were revised upwards due to the easing trade tensions and improved financial conditions the weaker dollar and the recent tax incentives aimed at stimulated business investment and consumer spending.
Speaker #3: In Europe, GDP accelerated driven by investment and next exports. Net exports. Growth in the area is now predicted at 1 percent for 2025, up 0.2 percent and 0.4 from April's projections, however many European countries continue to face subdued domestic demand manufacturing weakness and the lingering effects of the energy shock.
Speaker #3: Global inflation is expected to continue declining with headline inflation projected to fall to 4.2 percent in 2025 and 3.6 percent in 2026, in the euro area inflation has gone down significantly, but in the US it is still elevated, as unemployment rates remain low.
Speaker #3: Emerging markets remain the primary drivers of global growth. India, for example, is forecast to expand by 6.4% in both 2025 and 2026, fueled by strong investment, robust agriculture, and a dynamic services sector.
Aristides Pittas: Emerging markets remain the primary drivers of global growth. India, for example, is forecast to expand by 6.4% in both 2025 and 2026, fueled by strong investment, robust agriculture, and a dynamic services sector. The ASEAN five countries are also projected to post healthy gains. In China, growth has been revised upwards, driven by stronger than expected economic performance in the first half of the year, lower than anticipated tariffs between the U.S. and China, at least today, and the positive impacts of fiscal stimulus and reforms aimed at clearing local government arrears, which have all boosted domestic demand. Turning to the container ship demand outlook, Clarkson's latest estimates as of July 2025 project container trade to grow by 2.7% in 2025. This upward revision reflects the assumption that Red Sea disruptions will persist in the near term, resulting in longer voyage distances and increased stone mile demand.
Speaker #3: The Azerbaijani countries are also projected to post healthy gains. Also, in China, growth has been revised upwards, driven by stronger-than-expected economic performance in the first half of the year.
Speaker #3: Lower-than-anticipated tariffs between the US and China at least to date, and the positive impact of fiscal stimulus and reforms aimed at clearing local government arrears, which have all boosted domestic demand.
Speaker #3: Turning to the container ship demand outlook, Clarkson's latest estimates as of July 2025 project container trade to grow by 2.7% in 2025. This upward revision reflects the assumption that Red Sea disruptions will persist in the near term, resulting in longer voyage distances and increased on-mile demand.
Speaker #3: For 2026, Clarkson assumes gradual unwinding of these effects, projecting a contraction of 3 percent. Sudra-routed volumes return to the Suez Canal, voyage distances would shorten, despite underlying cargo volumes remaining relatively stable.
Aristides Pittas: For 2026, Clarkson assumes gradual unwinding of these effects, projecting a contraction of 3%. Should routed volumes return to the Suez Canal, voyage distances would shorten despite underlying cargo volumes remaining relatively stable. Turning to slide 11, you can see the total fleet age profile and container ship outlook. The container ship fleet is relatively young, with most vessels under 15 years old and only 12% of the fleet over 20 years old. Deliveries as a percentage of total fleet stand at 7% for 2025, 5% for 2026, 7.5% for 2027, and 13% for 2028 onwards. As of August 8, 2025, the order book stands at 30.7% of the existing fleet, reflecting the ongoing wave of new bid activity across the sector.
Speaker #3: Turning on to slide 11, you can see the total fleet age profile and container ship order books. The container ship fleet is relatively young, with most vessels under 15 years old, and only 12 percent of the fleet over 20 years old.
Speaker #3: Deliveries as a percentage of total fleet stand at 7 percent for 2025, 5 for 2026, 7 and a half for 2027, and 13 percent for 2028 onwards.
Speaker #3: As of August 8, 2025, the order book stands at 30.7% of the existing fleet, reflecting the ongoing wave of new building activity across the sector.
Speaker #3: Turning on to slide 12, however, we look we take a look over the fleet age profile and order book for ships in the 1,000 to 3,000 TEU range only.
Aristides Pittas: Turning to slide 12, however, we take a look over the fleet age profile and order book for ships in the 1,000 to 3,000 TEU range only, the sizes we mostly operate in. The order book here stands at just 5.4% as of August 2025. A completely different picture, as you can see, than the overall order book. According to Clarkson's, new building deliveries for feeder container ships are expected to remain limited over the coming years. In 2025, deliveries in this segment are projected to amount to 2.1% of the total fleet only. This already modest delivery schedule is expected to slow further to 1.5% in 2026, followed by 2.5% in 2027. A similar positive pattern also holds for vessels in the 3,000 to 6,000 TEU range. Let's move to slide 13, which shows the different supply fundamentals across the various container ship sizes.
Speaker #3: The sizes we mostly operate in. The order book here stands at just 5.4 percent as of August 2025. A completely different picture as you can see than the overall order book.
Speaker #3: According to Clarkson's, new building deliveries for feeder container ships are expected to remain limited over the coming years. In 2025, deliveries in this segment are projected to amount to 2.1 percent of the total fleet only.
Speaker #3: This already modest delivery schedule is expected to slow further to 1.5 percent in 2026, followed by 2.5 percent in 2027. A similar positive pattern also holds for vessels in the 3 to 6 thousand TEU range.
Speaker #3: Let's move to slide 13, which shows the different supply fundamentals across the various container ship sizes. As you can clearly see, the global order book remains heavily concentrated on the large vessels, servicing main lane routes, with significant capacity growth expected there.
Aristides Pittas: As you can clearly see, the global order book remains heavily concentrated on the large vessels servicing main lane routes, with significant capacity growth expected there. However, feeder and intermediate vessels, which are essential for regional distribution, face a very different supply outlook. Their order books are extremely limited, and the existing fleet is relatively old, with a large percentage of vessels over 20 years of age. These aging units are prime scrapping candidates in the softening market, particularly as environmental regulations tighten. As a result, it is quite possible that the fleet capacity for feeder and intermediate container ships may actually decline, even as the overall container ship fleet continues to grow. This evolving supply backdrop supports a structurally tight market in our operating segments, with favorable implications for vessel utilization and charter rates.
Speaker #3: However, feeder and intermediate vessels, which are essential for regional distribution, face a very different supply outlook. Their order books are extremely limited, and the existing fleet is relatively old, with a large percentage of vessels over 20 years of age.
Speaker #3: These aging units are prime scrapping candidates in a softening market, particularly as environmental regulations tighten. As a result, it is quite possible that the fleet capacity for feeder and intermediate container ships may actually decline even as the overall container ship fleet continues to grow.
Speaker #3: This evolving supply backdrop supports a structurally tight market in our operating segments, with favorable implications for vessel utilization and charter rates. Moving on to slide 14, we can see that for the remainder of 2025, rerouting away from the Red Sea is the major factor affecting the market.
Aristides Pittas: Moving on to slide 14, for the remainder of 2025, rerouting away from the Red Sea is the major factor affecting the market. The other factor that may also have a significant impact, as already said during the year, is, of course, the U.S. administration's tax packages that mostly took effect last week, but we still have things to see there. Following renewed attacks on cargo ships in the Red Sea in early July by Yemen's Houthi rebels, fears of further escalation have delayed any meaningful return to the Suez Road. As a result, our revised assumption is that rerouting will persist through the end of 2025, with a possible reversal sometime in 2026. With the implementation of the new U.S. tariffs, following further negotiations with key trading partners, ranging from 10% to 50%, depending on product and origin, trade flows could be disrupted further.
Speaker #3: The other factor that may also have a significant impact, as already said, during the year, is of course the US administration's tariff packages, that mostly took effect last week, but we still have things to see there.
Speaker #3: Following renewed attacks on cargo ships in the Red Sea in early July by Yemen's Houthi rebels, fears of further escalation have delayed any meaningful return to the Suez route.
Speaker #3: As a result, our revised assumption is that rerouting would persist through the end of 2025, with a possible reversal sometime in 2026. With the implementation of the new US tariffs, following further negotiations with key trading partners, arranging from 10 to 50 percent, depending on product and origin, trade flows could be disrupted further.
Speaker #3: At the moment, we expect their impact on global GDP and demand to remain relatively mutable. Against this backdrop, we therefore anticipate time charter rates to remain exceptionally strong for the remainder of 2025.
Aristides Pittas: At the moment, we expect their impact on global GDP and demand to remain relatively muted, though. Against this backdrop, we therefore anticipate time charter rates to remain exceptionally strong for the remainder of 2025. Looking into 2026, market conditions will hinge primarily on the status of geopolitical and economic events. Should the passage through the Suez Canal remain restricted, we expect the market to hold firm with only a modest decline. However, a faster than expected reopening could prompt a more pronounced market correction. Meanwhile, container ship ordering activity continues to accelerate, further inflating an already elevated order book and pulling longer-term supply challenges from 2027 onwards. Energy transition is gaining more and more traction in the sector, with a clear industry shift towards alternative fuels and, in particular, the medium-term solution of LNG. Most new building orders encompass at least an LNG-ready option.
Speaker #3: Looking into 2026, market conditions will hinge primarily on the status of geopolitical and economic events. Should the passage through the Suez Canal remain restrictive, we expect the market to hold firm, with only a modest decline.
Speaker #3: However, a faster-than-expected reopening could prompt a more pronounced market correction. Meanwhile, container ship ordering activity continues to accelerate, further inflating an already elevated order book and posing longer-term supply challenges from 2027 onwards.
Speaker #3: Energy transition is gaining more and more traction in the sector, with a clear industry shift towards alternative fuels, and in particular the medium-term solution of LNG.
Speaker #3: Most new building orders encompass at least an LNG-ready option. That said, technical and economic headwinds are expected to keep the pace of adoption slow.
Aristides Pittas: That said, technical and economic headwinds are expected to keep the pace of adoption slow. Eco-efficient vessels are, of course, increasingly commanding a charter rate premium as charters and regulators intensify the focus on emissions compliance and sustainable transport solutions. The recent shift in U.S. energy policy under the current administration, marked by a more fossil fuel-friendly stance, is likely to delay, but definitely not derail, the overall transition. Please turn to slide 15. The left-hand side slide graph shows the one-year time charter rate for 2,500 TEU container ships over the past 10 years. As of August 8, the one-year time charter rate for these container ships stood at just above $35,000 a day. While below its recent peak, this level remains exceptionally high and is well above both the historical average and median.
Speaker #3: Eco-efficient vessels are, of course, increasingly commanding a charter rate premium, as charters and regulators intensify their focus on emissions compliance and sustainable transport solutions. The recent shift in U.S. energy policy under the current administration, marked by a more fossil fuel-friendly stance, is likely to delay, but definitely not derail, the overall transition.
Speaker #3: Now, please turn to slide 15. The left-hand side slide graph shows the one-year time charter rate for two and a half thousand TEU container ships over the past ten years.
Speaker #3: As of August 8th, the one-year time charter rate for these container ships stood at just above 35,000 dollars a day. While below its recent peak, this level remained exceptionally high, and is well above both the historical average and median.
Speaker #3: In parallel, new building and second-hand vessel prices have also risen over the past year, and remain significantly above their long-term historical averages too. We have a significant amount of free liquidity which we are constantly evaluating how to best use.
Aristides Pittas: In parallel, new building and second-hand vessel prices have also risen over the past year and remain significantly above their long-term historical averages too. We have a significant amount of free liquidity, which we are constantly evaluating how to best use. We are returning part of this to our shareholders through our dividends and our stock repurchase plan. We are committed to offering our shareholders a good dividend through both good and bad times, and therefore, we are maintaining necessary reserves to cater for a possible downturn. At the same time, we are keeping most of our profits available to help grow the company further.
Speaker #3: We are returning part of this to our shareholders through our dividend and our stock repurchase plan. We are committed to offering our shareholders a good dividend through both good and bad times, and therefore we are maintaining necessary reserves to cater for a possible downturn.
Speaker #3: At the same time, we are keeping most of our profits available to help grow the company further. In this environment of extremely high prices and similarly high charter rates, we are not thinking of buying second-hand vessels unless we can simultaneously secure charter rates that will bring the residual value of the vessel at the end of the charter, to a median level.
Aristides Pittas: In this environment of extremely high prices and similarly high charter rates, we are not thinking of buying second-hand vessels unless we can simultaneously secure charter rates that will bring the residual value of the vessel at the end of the charter to a median level. This is proving difficult to find, though. New building prices have also increased substantially during the last five years. However, we feel this is a structural increase that will be very difficult to reverse. Prices will probably not drop, at least significantly. We are therefore seriously considering options along this front. With that, I will pass the floor to our CFO, Anastasios Aslidis, to go over our financial highlights and further details.
Speaker #3: This is proving difficult to find, though. New building prices have also increased substantially during the last five years, however we feel this is a structurally increase that will be very difficult to reverse.
Speaker #3: Prices will probably not drop, at least significantly. We are therefore seriously considering options along this front. And with that, I will pass the floor to our CFO, Anastasios Aslidis, to go over our financial highlights in further detail.
Speaker #4: Thank you, Aristides. Good morning from me as well, ladies and gentlemen. As usual, I will use the next four slides to give you an overview of our financial highlights for the second quarter and first half of 2025, and again compare them to the same periods of 2024.
Anastasios Aslidis: Thank you, Aristides. Good morning from me as well, ladies and gentlemen. As usual, I will use the next four slides to give you an overview of our financial highlights for the second quarter and first half of 2025, and again compare them to the same period of 2024. For that, let's turn to slide 17 to review our results for the second quarter of 2025. During that quarter, the company reported total net revenues of $57.2 million, representing a small decrease of 2.5% of the total net revenues of $58.7 million during the second quarter of 2024. The company reported a net income for the period of $29.9 million as compared to a net income of $4.75 million for the same period of 2024.
Speaker #4: For that, let's turn to slide 17 to review our results for the second quarter of 2025. During that quarter, the company reported total net revenues of $57.2 million, representing a small decrease of 2.5 percent from the total net revenues of $58.7 million during the second quarter of 2024.
Speaker #4: The company reported a net income for the period of 29.9 million, as compared to a net income of 4.75 million for the same period of 2024.
Speaker #4: This was the result of a gain on a sale of a vessel recorded during the the same period of last year, and the lowered time charter rates our vessels earn in the second quarter of 2025, compared to the previous year, the same quarter as the previous year, partly offset by the increase in the average number of vessels owned and operated during the second quarter of this year compared to last.
Anastasios Aslidis: This was the result of a gain on a sale of a vessel recorded during the same period of last year and the lower time charter rates our vessels earned in the second quarter of 2025 compared to the same quarter of the previous year, partly offset by the increase in the average number of vessels owned and operated during the second quarter of this year compared to last. Total interest and other financing costs for the second quarter of 2025 amounted to $4 million compared to $2.1 million for the second quarter of 2024. Capitalized interest charged on the cost of our new building program was $1.4 million for the second quarter of 2024. That was a reason that we recorded lower interest expense taking into account the interest income.
Speaker #4: Total interest and other financing costs for the second quarter of 2025 amount to 4 million, compared to 2.1 million for the second quarter of 2024.
Speaker #4: Capitalized interest charged on the cost of our new building program was 1.4 million for the second quarter of 2024. And that was a reason that we recorded lower interest expense taking into account the increased interest income.
Speaker #4: This increase is part of the increase, though, in addition to that, is due to the increased amount of debt we carried in the current period over the same period of last year.
Anastasios Aslidis: This increase, part of the increase, though, in addition to that, is due to the increased amount of debt we carry in the current period over the same period of last year. Adjusted EBITDA for the second quarter of 2025 was $39.3 million compared to $42.3 million achieved during the second quarter of 2024. Basic and diluted earnings per share for the second quarter of this year was $4.72 and $4.29, calculated on about 6.9 million and 7 million diluted weighted average number of shares outstanding, compared to basic and diluted earnings per share of $5.99 and $5.84, respectively, for the second quarter of 2024, again, calculated on 6.9 and 7 million weighted average number of shares outstanding.
Speaker #4: Adjusted EBITDA for the second quarter of 2025 was 39.3 million, compared to 42.3 million achieved during the second quarter of 2024. Basic and diluted earnings per share for the second quarter of this year was 4.32 and 4.29 dollars, calculated on about 6.9 million and 7 million diluted weighted average number of shares outstanding, compared to basic and diluted earnings per share for five dollars ninety-nine cents and five dollars ninety-four cents respectively, for the second quarter of 2024, again calculated on 6.9 and 7 million weighted average number of shares outstanding.
Speaker #4: Excluding the effect on the income of the unrealized loss and derivatives, the amortization of below-market time charters acquired, and the portion of the vessel depreciation allocated to the below-market time charters, the adjusted earnings per share for the quarter and the June 30th, 2025, would have been four dollars and twenty-three cents basic and four dollars and twenty cents diluted, compared to adjusted earnings of 4.95 dollars and 4.92 dollars basic and diluted respectively from the same quarter of last year.
Anastasios Aslidis: Excluding the effects on the income of the unrealized loss on derivatives, the amortization of below-market time charters acquired, and the portion of the vessel depreciation allocated to the below-market time charters, the adjusted earnings per share for the quarter ended June 30, 2025, would have been $4.23 basic and $4.20 diluted, compared to adjusted earnings of $4.95 and $4.92 basic and diluted, respectively, from the same quarter of last year. The latter figure still including the recording of deferred revenues that we had to record due to rate averaging, and so we had to recognize as a result of the chartering of the relevant vessel being free. Let us now look at the numbers for the corresponding six-month period ended June 30, 2025, and compare it to the same period of last year.
Speaker #4: With a later figure, still including the recording of deferred revenues that we had to record due to rate averaging. Here, we had to recognize as a result of the charterings of the relevant vessels being fit.
Speaker #4: Let's now look at the numbers for the corresponding six-month period and June 30, 2025, and compare it to the same period of last year.
Speaker #4: For the first half of 2025, we reported total net revenues of 113.6 million, representing a 7.7 percent increase of the total net revenues of 105.4 million during the first half of 2024.
Anastasios Aslidis: For the first half of 2025, we reported total net revenues of $113.6 million, representing a 7.7% increase of the total net revenues of $105.4 million during the first half of 2024. We reported a net income for the period of $66.8 million, a marginal difference, marginal increase over the $60.8 million for the first half of 2024. Total interest and other financing costs for the first half of 2025 amounted to $7.9 million. Capitalized interest charges on the cost of our new building program was $0.1 million for the first six months of 2025. For the same period of 2024, interest and other financing costs amounted in total to $3.9 million, which was inclusive of capitalized interest charged on the new to finance the new building program that was recorded as interest income of $2.7 million for the same period of 2024.
Speaker #4: We reported a net income for the period of 66.8 million, a marginal difference, marginal increase over the 60.8 million for the first half of 2024.
Speaker #4: Total interest and other financing costs for the first half of 2025 amounted to 7.9 million, capitalized interest charges on the cost of our new building program was 0.1 million for the first six months of 2025.
Speaker #4: For the same period of 2024, interest and other financing costs amounted in total to 0.9 million, which was inclusive of capitalized interest charged on the new finance and new building program that was recorded as interest income of 2.7 million for the same period of 2024.
Speaker #4: Adjusted EBITDA for the first half of 2025 was $76.4 million, compared to $66.9 million achieved during the first half of last year. Basic and diluted earnings per share for the first half of 2025 were 9.63 cents and 9.60 cents, respectively, calculated on a diluted weighted average number of shares outstanding of 6.9 million and 7 million. This compares to basic and diluted earnings per share of 8.77 cents and 8.71 cents, respectively, for the same period of last year.
Anastasios Aslidis: Adjusted EBITDA for the first half of 2025 was $76.4 million compared to $66.9 million achieved during the first half of last year. Basic and diluted earnings per share for the first half of 2025 were $9.63 and $9.60 respectively, calculated on again 6.9 and 7 million. These figures are rounded to diluted weighted average number of shares outstanding compared to basic and diluted earnings per share of $8.77 and $8.71, respectively, for the same period of last year.
Speaker #4: Again, excluding the effect on the income for the first half of the year of the unrealized loss or gain on derivatives, the gain on sale of vessels and the amortization of below-market time charters acquired, and the portion of the depreciation allocated to the below-market charters, the adjusted earnings per share for the first six months of this year would have been 7.99 cents basic and 7.87 cents diluted, compared to adjusted earnings per share of 7.63 cents basic and 7.57 cents diluted, for the same period of 2024.
Anastasios Aslidis: Again, excluding the effect on the income for the first half of the year of the unrealized loss or gain on derivatives, the gain on sale of vessels, and the amortization of below-market time charters acquired and the portion of the depreciation allocated to the below-market charters, the adjusted earnings per share for the first six months of this year would have been $7.99 basic and $7.87 diluted compared to adjusted earnings per share of $7.63 basic and $7.57 diluted for the same period of 2024. Now let's turn to slide 18 to review, again as usual, our fleet performance. We'll start our review by looking at our fleet utilization rate for the second quarter of 2025 and 2024. Our fleet utilization rate is broken down into commercial and operational components.
Speaker #4: Now, let's turn to slide 18 to review, again as usual, our fleet performance. We'll start our review by looking at our fleet utilization rate for the second quarter of 2025 and 2024.
Speaker #4: Our fleet utilization rate is broken down into commercial and operational components. During the second quarter of both years, our commercial utilization rate stood at 100%, while our operational utilization rate was also similar in both quarters and stood at 99.9%.
Anastasios Aslidis: During the second quarter of both years, our commercial utilization rate stood at 100%, while our operational utilization rate also was similar in both quarters and stood at 99.9%. On average, 22 vessels were owned and operated during the second quarter of 2025, earning an average time charter equivalent rate of $29,420 per day compared to 21.6 vessels for the same period of last year, earning on average $31,639 per day. Our total operating expenses, including management and G&A expenses, but excluding the idling costs, were for the second quarter of 2025 $7,394 per vessel per day compared to $7,193 per vessel per day for the same period of last year. If we move further down on this table, we can see the cash flow break-even rate, which also tends to account for dry docking expenses, interest expenses, and loan repayments.
Speaker #4: On average, 22 vessels were owned and operated during the second quarter of 2025, earning an average time charter equivalent rate of $29,420 per day, compared to 21.6 vessels for the same period last year, earning on average $31,639 per day.
Speaker #4: Our total operating expenses, including management and G&A expenses but excluding the operating costs, were $7,694 per vessel per day for the second quarter of 2025, compared to $7,193 per vessel per day for the same period of last year.
Speaker #4: If we move further down on this table, we can see the cash flow break-even rate which also changed to account dry docking expenses, interest expenses, and loan repayments.
Speaker #4: Thus, in total, for the second quarter of 2025, our daily cash flow break-even level was 13,262 dollars per vessel per day, compared to 13,698 dollars per vessel per day, for the second quarter of the year before.
Anastasios Aslidis: Thus, in total, for the second quarter of 2025, our daily cash flow break-even level was $13,262 per vessel per day compared to $13,698 per vessel per day for the second quarter of the year before. Let us now review the same figures for the six-month periods for both years. During the first half of 2025, our commercial utilization rate was 100%. Our operational utilization rate stood at 99.6% compared to 99.9% commercial and also 99.9% operational for the same period, the first six months of 2024. During this period, the six-month period of 2025, we operated 22.83 vessels, earning an average time charter equivalent rate of $28,468 per day, while for the same period, the first six months of 2024, we owned and operated 20.43 vessels, earning on average $29,836 per day.
Speaker #4: Let us now review the same figures for the six-month periods for both years. During the first half of 2025, our commercial utilization rate was 100 percent, and our operational utilization rate stood at 99.6 percent, compared to 99.9 percent commercial and also 99.9 percent operational for the same period in the first six months of 2024.
Speaker #4: During this period, the six-month period of 2025, we operated 22.83 vessels, earning an average time charter equivalent rate of 28,468 dollars per day. While for the same period, the first six months of 2024, we owned and operated 20.43 vessels, earning on average 29,836 dollars per day.
Speaker #4: Again, our operating expenses including management fees and G&A expenses, but not dry docking, were 7,454 dollars per day in the first half of this year, compared to 7,563 dollars for the same period of 2024.
Anastasios Aslidis: Again, our operating expenses, including management fees and G&A expenses, but not dry docking, were $7,454 per day in the first half of this year compared to $7,563 for the same period of 2024. Looking further down on the table, our cash flow break-even level for the first six months of 2025 was $13,164 per vessel per day compared to $15,372 per vessel per day, mainly the result of lower loan repayments that we had during this year. At the bottom of this table, we can also see how our common dividend translates on a dollar per vessel per day basis. You can see that during the second quarter of 2025, that amounted to $2,275 per vessel per day, while for the first six months of 2025, that amounted to $2,196 per vessel per day for the dividend payment. Moving on to slide 19 to review our debt profile.
Speaker #4: And again, looking further down on the table, our cash flow break-even level for the first month six months of 2025 was 13,164 dollars per vessel per day, compared to 16,372 dollars per vessel per day, mainly the result of lower loan repayments that we had during this year.
Speaker #4: At the bottom of this table, we can also see how our common dividend dollar per vessel per day basis, and you can see that during the second quarter of 2025, that amounted to 22,75 dollars per vessel per day, while for the first six months of 2025, that amounted to 21,196 dollars per vessel per day, for the for the dividend payments.
Speaker #4: Moving on to slide 19, to review our debt profile, as of translates on a June 30th of this year, our total outstanding debt stood at 229.4 million, with an average margin of approximately 2 percent, which is on which if you add a three-month soft rate of about 4.23 percent, the overall cost of our senior debt is around 6.24 percent, and in fact, it's a bit lower because part of our debt is the cost of part of our debt is swapped at a lower soft rate, so the overall cost of our debt on average is below 6.2 percent.
Anastasios Aslidis: As of June 30th of this year, our total outstanding debt stood at $229.4 million, with an average margin of approximately 2%, which if you add a three-month soft rate of about $4.23%, the overall cost of our senior debt is around 6.24%. In fact, it's a bit lower because part of our debt is the cost of part of our debt is swapped at a lower soft rate. So the overall cost of our debt on average is below 6.2%. The remaining loan repayments for 2025 amount to about $10.8 million on the top of loan repayments of almost $13 million already made in the first half of the year, during which we actually replaced the balloon of a loan that matured. With these repayments, our debt at the end of the year will be $218.6 million.
Speaker #4: Remaining loan repayments for the for 2025 amount to about 10.8 million, on the top of loan repayments of almost 30 million already made in the first half of the year.
Speaker #4: During which we actually repaid the balloon of a loan that matured. With these repayments, our debt at the end of the year will be 218.6 million.
Speaker #4: In 2026, we have scheduled loan repayments, of about 19.5 million, with no balloon payments due, while in 2027, we anticipate to make 16.9 million in loan repayments, alongside about 20 million of balloon payments, resulting in total payments for in 2027 of 36.9 million.
Anastasios Aslidis: In 2026, we have scheduled all loan repayments of about $19.5 million with no balloon payments due, while in 2027, we anticipate to make $16.9 million in loan repayments alongside about $20 million of balloon payments, resulting in total payments in 2027 of $36.9 million. You can see the loan repayments for the outer years in this chart that we have on the slide. I would like to draw your attention to the bottom of this table of this slide, where we present our cash flow break-even level for the next 12 months, broken down by each component. Overall, we expect a cash flow break-even level of approximately $12,300 per vessel per day, a level meaningfully below the current daily earnings of our fleet. A little information on our balance sheet and asset values is shown on slide 20, the last slide of my brief presentation of the financial results.
Speaker #4: You can see the loan repayments for the further for the outer years in this chart that we have on the slide. I would like to draw your attention to the bottom of this table, of this slide, where we present our cash flow break-even level for the next 12 months, broken down by its components.
Speaker #4: Overall, we expect a cash flow break-even level of approximately $12,300 per vessel per day, a level meaningful below the current daily earnings of our fleet.
Speaker #4: Any information on our balances and asset values is shown on slide 20, the last slide of my brief presentation of the financial results. As of June 30th, our cash and other current assets in our balances amounted to 126.8 million, while we have made advances for the new building vessels of 18.1 million, and have as a book value of our fleet on our books, 517.3 million, including in this figure the vessel that we have agreed to sell at the end of its current charter.
Anastasios Aslidis: As of June 30, our cash and other current assets in our balance sheet amounted to $126.8 million, while we have made advances for the new building vessels of $18.1 million and have as a book value of our fleet on our books of $517.3 million, including in this figure the vessel that we have agreed to sell at the end of its current charter. Our overall book value of our assets stood at the end of June at $662.1 million. On our liability side, our debt, as I mentioned, stood at $229.4 million as of June 30, representing about 35% of the book value of our assets. We have other liabilities amounting to about $30 million, thus leaving us with a book shareholder's equity of a little more than $400 million or about $57.5 per share.
Speaker #4: Our overall book value of our assets stands or stood at the end of the of June at 662 point one million. On our liability side, our debt as I mentioned stood at 229.4 million, as of June 30th, representing about 35 percent of the book value of our assets.
Speaker #4: We have other liabilities amounting to about $30 million, thus leaving us with a book shareholder's equity of a little more than $400 million, or about $57.50 per share.
Speaker #4: It's also important to mention here, as I do in every earnings result, that the market value for our fleet, adjusted for the charters, currently in place, is significantly higher than its book value, and is in the range of 680 million based on our own estimates.
Anastasios Aslidis: It's also important to mention here, as I do in every earnings result, that the market value for our fleet, adjusted for the charters currently in place, is significantly higher than its book value and is in the range of $680 million based on our own estimates. If you recall, the book value was $513 million. Thus, as of the end of June, we estimate that the charter-adjusted net asset value of our company to be around $565 million, resulting in a net asset value per share in excess of $80. Despite our stock trading at higher levels during the last several weeks of around $50 per share, this level still represents a significant discount of the order of 35% to 40% to our net asset value.
Speaker #4: If you recall, the book value was 517 million. Thus, as of the end of June, we estimate that the charter adjusted net asset value for our company to be around 565 million dollars, resulting in a net asset value per share in excess of 80 dollars.
Speaker #4: Despite our stock trading at higher levels during the last several weeks, of around 50 dollars per share, this level still represents a significant discount of the order of 35 to 40 percent to our net asset value, and thus despite and that is happening despite our revenue and earnings visibility, making it evident that our stock was still offered further upside potential, and prospective gains for our shareholders and investors.
Anastasios Aslidis: That is happening despite our revenue and earnings visibility, making it evident that our stock will still offer further upside potential and prospective gain for our shareholders and investors. With that, I'd like to turn the floor back to our exceeders to continue the call.
Speaker #4: With that, I'd like to turn the floor back to Aristidis to continue the call.
Speaker #5: Thank you, Tasso. Let me open up the floor for any questions we may have.
Aristides Pittas: Thank you, Tasos. Let me open up the floor for any questions we may have.
Speaker #6: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad.
Markella Kara: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment, please, while we pull for questions. Our first question comes from the line of Tate Sullivan with Maxim Group. Please proceed with your question.
Speaker #6: A confirmation tone will indicate your line is in the question queue. You may press *2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.
Speaker #6: One moment, please, while we pull for questions. Our first question comes from the line of Tate Sullivan with Maxim Group. Please proceed with your question.
Speaker #7: Hi, thank you. Good day. With most of your days contracted for a year or more, I'm looking at the potential variability in the results. Do any of your container ship contracts have different rates based on the voyage?
Tate Sullivan: Hi, thank you. Good day. With most of your days contracted for a year, more than a year, I am looking at the potential variability in the results. Do any of your container ship contracts have different rates based on the voyage, or are they all fixed regardless, please?
Speaker #7: Or are they all fixed regardless, please?
Speaker #3: I I think they're all fixed, all our all our contracts are fixed rate contracts.
Anastasios Aslidis: I think they are all fixed. All our contracts are fixed rate contracts.
Speaker #7: Okay. All right. And no dependability on the voyage. Okay, thank you. And then on this, okay. And then on the planned sale of one of your ships, if you do decide to sell other ships in a good market, are there any trends in terms of the potential buyers?
Tate Sullivan: Okay. All right. No dependability on the voyage. Thank you. On the planned sale of one of your ships, if you do decide to sell other ships in a good market, are there any trends in terms of the potential buyers? Are they from specific countries or specific entities? Have you disclosed the buyer of the ship, please?
Speaker #7: Are they from specific countries or specific entities? And have you disclosed the buyer of the ship, please?
Speaker #3: The buyer of the ship is MSC. They are as you know the biggest buyer around over the last few years, and buying elder ships.
Aristides Pittas: The buyer of the ship is MSC. They are, as you know, the biggest buyer around over the last few years and buying elder ships. I do not anticipate that we will be selling anything else within this year. You never know, obviously. But we have fixed all the vessels, and I do not think we can give you anything.
Speaker #3: I don't anticipate that we will be selling anything else you know within this year. You never know obviously, but we have fixed all the vessels, and I don't think we will be doing anything.
Speaker #7: Okay. Thank you very much.
Tate Sullivan: Okay. Thank you very much.
Speaker #3: Thanks.
Anastasios Aslidis: Thanks.
Speaker #6: Thank you. And as a reminder, if anyone has any questions, you may press star one on your telephone keypad to join the queue. Our next question comes from the line of Mark Reichman with Noble Capital Markets.
Markella Kara: Thank you. As a reminder, if anyone has any questions, you may press star one on your telephone keypad to join the queue. Our next question comes from the line of Mark Reisman with Noble Capital Markets. Please proceed with your question.
Speaker #6: Please proceed with your question.
Speaker #8: Always nice to see another strong quarter. I just had a few questions. The feeder and intermediate container ship segments you know have small order books.
Mark Reisman: Well, always nice to see another strong quarter. I just had a few questions. The feeder and intermediate container ship segments have small order books. You mentioned the fleet's relatively old and the shift towards adopting new fuels remains slow. How are you thinking about your fleet in terms of growth in the number of intermediates versus feeders and new builds versus secondhand? I think you had mentioned you are not really interested in secondhand, but just kind of interested in your thoughts there.
Speaker #8: You've mentioned that the fleet's relatively old and that the shift towards adopting new fuels remains slow. So how are you thinking about your fleet in terms of growth in the number of intermediates versus feeders, and you know, new builds versus secondhand?
Speaker #8: I think you'd mentioned you're not really interested in secondhand but just kind of interested in your thoughts there.
Speaker #3: Yes, sure. We would buy, you know, 10- to 15-year-old vessels if we could find a suitable charter that would bring the residual value down at the end of the charter.
Aristides Pittas: Yeah, sure. We do not think, I mean, we would buy 10, 15-year-old vessels if we could find a suitable charter that would bring the residual value down at the end of the charter. But this is something that we have been trying to do without much success because the asking prices of the ships are too high. So I think it is rather difficult that we invest now in ships that are in the water currently. We like both sectors, the feeder sector and the intermediate sector. Their dynamics are very, very similar. Order books are below 7%, 8%, and ships over 20 years old in excess of 20% of 20%. So the dynamic is very nice over there. We look at potential projects and we will see how we will move ahead.
Speaker #3: But this is something that we have been trying to do, and without much success because you know the asking prices of the ships are too high.
Speaker #3: So I think it's rather difficult that we invest now in ships that are you know in the water currently. We like both sectors. The feeder sector and the intermediate sector, they're dynamics are very, very similar.
Speaker #3: Order books of, you know, below 7, 8 percent and ships over 20 years old in excess of 20 years, of 20 percent. So the dynamic is very nice over there.
Speaker #3: We look at potential projects and and we will see how we will you know move ahead.
Speaker #8: So do you think the supply-demand characteristics for these segments provide a relatively high level of durability to the rate outlook despite the uncertainties that you mentioned?
Mark Reisman: Do you think the supply-demand characteristics for these segments provide a relatively high level of durability to the rate outlook despite the uncertainties that you mentioned?
Speaker #3: It It provides some durability. I mean, we all know that the the cascading effect is quite significant with container ships, which means that you know if the if the rates for the bigger ships drop substantially, we would naturally expect to see a drop in the smaller vessels as well.
Aristides Pittas: It provides some durability. We all know that the cascading effect is quite significant with container ships, which means that, you know, if the rates for the bigger ships drop substantially, we would naturally expect to see a drop in the smaller vessels as well. However, we do feel that these supply-demand fundamentals offer some significant protection against as severe drops as may happen.
Speaker #3: However, we do feel that this supply-demand fundamentals offer some significant protection against as severe drops as may happen.
Speaker #8: Okay. And then just the last question: the dry docking expenses were $3.5 million for the first six months of 2025, but based on the information on slide 19, is it fair to say that dry docking activity will be light over the next 12 months?
Mark Reisman: The dry docking expenses were $3.5 million for the first six months of 2025. Based on the information on slide 19, is it fair to say that dry docking activity will be light over the next 12 months?
Speaker #3: Yes. Yeah, I think so. I think we had two vessels that dry-docked in the first part of the year, and I think our schedule is lighter for the next 6 or 12 months.
Anastasios Aslidis: Yes. I think so. I think we had two vessels that dried up in the first part of the year, and I think our schedule is lighter for the next 6 or 12 months.
Speaker #8: Okay. Well, thank you very much. I appreciate it.
Mark Reisman: Well, thank you very much. I appreciate it.
Speaker #3: My thanks, Mark.
Anastasios Aslidis: Thanks, Mark.
Speaker #6: Thank you. And again, as a reminder, if anyone has any questions, pressing *1 will join you into the queue to ask your question.
Markella Kara: Thank you. As a reminder, if anyone has any questions, pressing star one will join you into the queue to ask your question. Our next question comes from Clement Maldens with Value Investors Edge. Please proceed with your question.
Speaker #6: Our next question comes from Clement Maldens with Value Investors Edge. Please proceed with your question.
Speaker #9: Hi. Good afternoon. Thank you for taking my questions. Most has already been covered. Most has already been covered, but I wanted to ask whether you have any plans on what to do with the proceeds of the sale of the Marcos 5 or Marcos V.
Clement Maldens: Hi, good afternoon. Thank you for taking my questions. Most has already been covered. But I wanted to ask whether you have any plans on what to do with the proceeds of the sale of the Marcos V? Could you comment on potential avenues to allocate that capital? Could special dividends be in the cards, or would you prefer to make a debt prepayment or allocate it towards a new built-on order?
Speaker #9: Could you comment on potential avenues to allocate that capital? Could a special dividend be in the cards? Or would you prefer to make a debt repayment or allocate it towards a new build on order?
Speaker #3: We are considering the various options for the vessel, which will be delivered within October, and we are looking at various options. We will let you know more when we next talk.
Aristides Pittas: We are considering the various options. The vessel will be delivered within October, and we are looking at various options. We will let you know more when we next talk.
Speaker #9: Yeah. I think our board will need some time early in November, and we'll make a decision on how those proceeds would be best utilized.
Anastasios Aslidis: Yeah, I think our board will meet sometime in November, and we'll make a decision on how those proceeds will be best utilized or along the options you mentioned.
Speaker #9: Or how long the options you mentioned. All right. Makes sense. That's all from me. Thank you for taking my questions.
Clement Maldens: All right. Makes sense. That is all from me. Thank you for taking my questions.
Speaker #3: Thank you.
Anastasios Aslidis: Thank you.
Aristides Pittas: Thank you.
Speaker #6: Thank you. And we have reached the end of the question and answer session. I would like to turn the floor back to Mr. Titas for closing remarks.
Markella Kara: Thank you. We have reached the end of the question and answer session. I would like to turn the floor back to Mr. Pittas for closing remarks.
Speaker #3: Thank you very much, all, for attending after today's call. We will be back with you in three months' time.
Aristides Pittas: Thank you very much all for attending our today's call. We will be back with you in three months' time.
Speaker #9: Thank you for delivering similarly good results.
Anastasios Aslidis: Hopefully, to deliver a similarly good result.
Speaker #3: Probably. Thank you.
Aristides Pittas: Probably. Thank you.
Speaker #9: Bye, everybody.
Anastasios Aslidis: Bye, everybody.
Markella Kara: Thank you, and thank you.
INCOM Conferencing Operator: today's conference, and you may disconnect your line at this time. Thank you for your participation.