Genco Shipping & Trading Limited (NYSE:GNK) (“Genco” or the
“Company”), the largest U.S. headquartered drybulk shipowner
focused on the global transportation of commodities, today reported
its financial results for the three months and six months ended
June 30, 2023.
Second Quarter 2023 and Year-to-Date
Highlights
-
Dividend: Declared a $0.15 per share dividend for
Q2 2023
- 16th consecutive
quarterly payout
- Cumulative
dividends of $4.595 per share or 33% of the share price1
-
Financial performance: Net income of $11.6 million
for Q2 2023
- Basic and
diluted earnings per share of $0.27
- Adjusted EBITDA
of $30.0 million for Q2 20232
-
Deleveraging: Voluntarily prepaid debt of $8.75
million in Q2 2023
- Reduced debt to
$153.5 million at June 30, 2023
- Net
loan-to-value of 11%3
- Paid down $295.7
million or 66% of our debt since 2021
- Voyage
revenues: Totaled $90.6 million in Q2 2023
- Net revenue2 was
$60.7 million during Q2 2023
- Average daily
fleet-wide TCE,2 was $15,556 for Q2 2023
-
Estimated TCE to date for Q3 2023: $12,262 for 61%
of our owned fleet available days, based on both period and current
spot fixtures2
John C. Wobensmith, Chief Executive
Officer, commented, “During the second quarter, Genco
continued to execute the Company’s value strategy, as we
voluntarily paid down debt and provided shareholders with a
sizeable dividend. Genco has declared 16 consecutive dividends,
including our second quarter dividend of $0.15 per share, and paid
down 66% of our debt since 2021. We remain committed to our
medium-term goal of reducing net debt to zero, enabling us to
further reduce our industry-low cash flow breakeven rate.
Importantly, our TCE rate increased by 12% in the second quarter
relative to the first quarter while we continued to outperform our
benchmarks during the period. Based on our unique platform and
meaningful earnings power, we are well positioned to continue
delivering on our value strategy’s three pillars of dividends,
deleveraging, and growth.”
Mr. Wobensmith continued, “Looking ahead, we
believe favorable supply and demand fundamentals bode well for the
drybulk market’s long-term prospects. While an unwinding of port
congestion has temporarily increased effective capacity and
adversely impacted rates in the near term, we continue to see solid
commodity demand from China and developing Asia. Furthermore, the
newbuilding orderbook remains historically low with anticipated
constraints going forward in both drybulk fleet and shipyard
capacity. Genco is favorably positioned to draw on our sizable
fleet, best-in-class commercial platform and barbell approach to
fleet composition to capitalize on favorable long-term market
fundamentals. Lastly, for the third consecutive year, we are proud
to be ranked atop the Webber Research ESG scorecard out of 64
public shipping companies. We believe this is a true testament to
our overall initiatives and further highlights the strength of the
Genco team.”
1 Genco share price as of August 2, 2023.2 We
believe the non-GAAP measure presented provides investors with a
means of better evaluating and understanding the Company’s
operating performance. Please see Summary Consolidated Financial
and Other Data below for further reconciliation. Regarding Q3 2023
TCE, actual results will vary from current estimates. Net revenue
is defined as voyage revenues minus voyage expenses, charter hire
expenses and realized gains or losses on fuel hedges.3 Represents
the principal amount of our credit facility debt outstanding less
our cash and cash equivalents as of June 30, 2023 divided by
estimates of the market value of our fleet as of August 3, 2023
from VesselsValue.com. The actual market value of our vessels may
vary.
Comprehensive Value Strategy
Genco’s comprehensive value strategy is centered
on three pillars:
- Dividends: paying
sizeable quarterly cash dividends to shareholders
- Deleveraging:
through voluntary debt prepayments to maintain low financial
leverage, and
- Growth:
opportunistically growing the Company’s asset base
This strategy is a key differentiator
for Genco, which we believe creates a compelling
risk-reward balance to drive shareholder value over the long-term.
The Company is positioned to pay a sizeable quarterly dividend
across diverse market environments while maintaining significant
flexibility to grow the fleet through accretive vessel
acquisitions.
Key characteristics of our unique
platform include:
- Industry low cash flow breakeven
rate
- Net loan-to-value of 11% as of
August 3, 2023
- Strong liquidity position of $260.9
million, which consists of:
- $53.9 million of
cash on the balance sheet
- $207.0 million
of revolver availability
- High operating
leverage with our scalable fleet across the major and minor bulk
sectors
Financial deleveraging
Genco has paid down $295.7 million or
66% of our debt since 2021
- Debt
outstanding: $153.5 million as of June 30, 2023
- Voluntarily paid
down debt of $8.75 million in Q2 2023
- No mandatory
debt amortization payments until 2026 when the facility
matures
- We plan to
continue to voluntarily pay down debt
- Medium-term
goal: reducing net debt to zero
- Longer-term
goal: zero debt
Dividend Policy
Genco declared a cash dividend of $0.15
per share for the second quarter of 2023. While our stated
formula, with a quarterly reserve of $10.75 million, produced a
dividend of $0.13 per share for the quarter, the Board of Directors
elected on management’s recommendation to reduce the quarterly
reserve to $9.92 million in order to declare the $0.15 per share
dividend. A key component of Genco’s value strategy is maintaining
a quarterly reserve, as well as the optionality for the use of the
reserve as Genco seeks to pay sizeable dividends in diverse market
environments.
Genco’s industry low cash flow breakeven rate
and low financial leverage, together with our view of an
improvement of freight rates from current spot levels gave the
Company confidence to utilize part of the quarterly reserve to
declare a larger quarterly dividend. This represents our seventh
dividend payment under our value strategy with cumulative dividends
declared to date of $3.54 per share. The Q2 2023 dividend is
payable on or about August 23, 2023 to all shareholders of record
as of August 16, 2023.
Under the quarterly dividend policy adopted by
our Board of Directors, the amount available for quarterly
dividends is to be calculated based on the formula in the table
below. The table includes the calculation of the actual Q2 2023
dividend and estimated amounts for the calculation of the dividend
for Q3 2023:
Dividend calculation |
Q2 2023 actual |
Q3 2023 estimates |
Net revenue |
$ |
60.66 |
|
Fixtures + market |
Operating expenses |
|
(30.84 |
) |
(33.78 |
) |
Operating cash flow |
$ |
29.82 |
|
|
Less: debt repayments |
|
(8.75 |
) |
(8.75 |
) |
Less: capex for dydocking/BWTS/ESDs |
|
(4.69 |
) |
(5.55 |
) |
Less: reserve* |
|
(9.92 |
) |
(10.75 |
) |
Cash flow distributable as dividends |
$ |
6.46 |
|
Sum of the above |
Number of shares to be paid dividends |
|
43.1 |
|
43.1 |
|
Dividend per share |
$ |
0.15 |
|
|
Numbers in millions except per share amounts |
|
|
*Q2 2023 reserve reduced from $10.75m to $9.92m |
|
|
|
|
|
Operating cash flow is defined
as net revenue (consisting of voyage revenue less voyage expenses,
charter hire expenses, and realized gains or losses on fuel
hedges), less operating expenses (consisting of vessel operating
expenses, general and administrative expenses other than non-cash
restricted stock expenses, technical management fees, and interest
expense other than non-cash deferred financing costs), for purposes
of the foregoing calculation. Estimated expenses, debt repayments,
and capital expenditures for Q3 2023 are estimates presented for
illustrative purposes.
The quarterly reserve for the third
quarter of 2023 under the Company’s dividend formula is
expected to be $10.75 million. Subject to the development of
freight rates for the remainder of the third quarter and our
assessment of our liquidity and forward outlook, we maintain
flexibility to reduce the quarterly reserve to pay dividends or
increase the amount of dividends otherwise payable under our
formula.
Anticipated uses for the reserve
include, but are not limited to:
- Vessel acquisitions
- Debt repayments, and
- General corporate purposes
We plan to set the reserve on a
quarterly basis for the subsequent quarter, and it is
anticipated to be based on future quarterly debt repayments and
interest expense and remains subject to our Board of Directors’
discretion. Maintaining a quarterly reserve as well as optionality
for the uses of the reserve are important factors of our corporate
strategy that are intended to allow Genco to retain liquidity to
take advantage of a variety of market conditions.
The Board expects to reassess the payment
of dividends as appropriate from time to time. Our quarterly
dividend policy and declaration and payment of dividends are
subject to legally available funds, compliance with applicable law
and contractual obligations (including our credit facility) and the
Board of Directors’ determination that each declaration and payment
is at the time in the best interests of the Company and its
shareholders after its review of our financial performance.
Peter Allen, Chief Financial Officer,
commented, “Genco continues to utilize a prudent capital
allocation approach striking a solid balance between debt
repayments and dividend distribution during the second quarter. In
the year-to-date, we have voluntarily paid down $17.5 million of
debt bringing our total debt repayments to nearly $300 million over
the last 2.5 years. This has enabled Genco to continue to
strengthen its industry-leading balance sheet while also paying
meaningful dividends to shareholders. Furthermore, with over $260
million of available liquidity, through cash on the balance sheet
and undrawn revolver availability, Genco maintains significant
financial flexibility going forward.”
Genco’s Active Commercial Operating
Platform and Fleet Deployment Strategy
We utilize a portfolio approach
towards revenue generation through a combination of:
- Short-term, spot market employment,
and
- Opportunistically booking longer
term coverage
Our fleet deployment strategy currently remains
weighted towards short-term fixtures, which provide us with
optionality on our sizeable fleet.
Our barbell approach towards fleet
composition enables Genco to gain exposure to both the
major and minor bulk commodities with a fleet whose cargoes carried
align with global commodity trade flows. This approach continues to
serve us well given the upside potential in major bulk rates
together with the relative stability of minor bulk rates.
Based on current fixtures to date, our estimated
TCE to date for the third quarter of 2023 on a load-to-discharge
basis is presented below. Actual rates for the third quarter will
vary based upon future fixtures. These estimates are based on time
charter contracts entered by the Company as well as current spot
fixtures on the load-to-discharge method, whereby revenue is
recognized ratably over the voyage from the commencement of loading
to the completion of discharge. The actual TCE rates to be earned
will depend on the number of contracted days and the number of
ballast days at the end of the period. According to the
load-to-discharge accounting method, the Company does not recognize
revenue for any ballast days or uncontracted days at the end of the
third quarter of 2023. At the same time, expenses for uncontracted
days will be recognized.
Estimated net TCE – Q3 2023 to Date |
Vessel Type |
Fleet-wide |
% Fixed |
Capesize |
$ |
16,961 |
57% |
Ultra/Supra |
$ |
9,512 |
64% |
Total |
$ |
12,262 |
61% |
|
|
|
Our longer term fixed rate and index-linked time
charters are listed below.
Vessel |
Type |
DWT |
Year Built |
Rate |
Duration |
Min Expiration |
Genco Maximus |
Capesize |
169,025 |
2009 |
$ |
27,500 |
24-30 months |
Sep-23 |
|
|
|
|
|
|
|
Genco Endeavour |
Capesize |
181,060 |
2015 |
127% of BCI + scrubber premium |
11-14 months |
Jan-24 |
Genco Resolute |
Capesize |
181,060 |
2015 |
127% of BCI + scrubber premium |
11-14 months |
Feb-24 |
Genco Defender |
Capesize |
180,021 |
2016 |
125% of BCI + scrubber premium |
11-14 months |
Apr-24 |
|
|
|
|
|
|
|
We have approximately seven Capesize vessels
coming open in the coming weeks, a portion of which we plan to
ballast to the Atlantic basin.
Financial Review: 2023 Second
Quarter
The Company recorded net income for the second
quarter of 2023 of $11.6 million, or $0.27 basic and diluted
earnings per share, respectively. Comparatively, for the three
months ended June 30, 2022, the Company recorded net income of
$47.4 million, or $1.12 and $1.10 basic and diluted earnings per
share, respectively.
Revenue / TCEThe Company’s
revenues decreased to $90.6 million for the three months ended June
30, 2023, as compared to $137.8 million recorded for the three
months ended June 30, 2022, primarily due to lower rates earned by
our minor and major bulk vessels. The average daily time charter
equivalent, or TCE, rates obtained by the Company’s fleet was
$15,556 per day for the three months ended June 30, 2023 as
compared to $28,756 per day for the three months ended June 30,
2022.
Voyage expensesVoyage expenses
were $28.8 million for the three months ended June 30, 2023
compared to $32.5 million during the prior year period, primarily
due to lower bunker consumption for our minor bulk vessels, as well
as decreased fuel prices during the second quarter of 2023 as
compared to the same period during 2022.
Vessel operating expensesVessel
operating expenses decreased to $22.6 million for the three months
ended June 30, 2023 from $29.5 million for the three months ended
June 30, 2022. Daily vessel operating expenses, or DVOE, amounted
to $5,641 per vessel per day for the second quarter of 2023
compared to $7,358 per vessel per day for the second quarter of
2022. The decrease was primarily due to lower COVID-19 related
expenses in 2023 over the same period last year, a decrease in the
purchase of stores and spare parts, and reduced repair and
maintenance costs. We experienced those higher costs last year as
we completed the transition of vessels to our new technical
management joint venture through the first half of 2022.
We believe daily vessel operating expenses are
best measured for comparative purposes over a 12-month period in
order to take into account all of the expenses that each vessel in
our fleet will incur over a full year of operation. Based on
estimates provided by our technical manager, our DVOE budget for Q3
2023 is $6,250 per vessel per day on a fleet-wide basis. The
potential impacts of the war in Ukraine and COVID-19 are
unpredictable, and the actual amount of our DVOE could be higher or
lower than budgeted as a result.
General and administrative
expensesGeneral and administrative expenses increased to
$6.9 million for the second quarter of 2023 compared to $6.4
million for the second quarter of 2022, primarily due to an
increase in non-cash stock amortization expenses.
Depreciation and amortization
expensesDepreciation and amortization expenses increased
to $16.8 million for the three months ended June 30, 2023 from
$14.5 million for the three months ended June 30, 2022, primarily
due to an increase in drydocking amortization expense for the major
bulk vessels that completed their respective drydockings during the
second quarter of 2022 through the first quarter of 2023.
Drybulk market updateIn Q2
2023, spot freight rates improved relative to Q1 2023, but remained
volatile due to various factors including:
- Solid iron ore and coal shipments
into China
- Unwinding of port congestion
increasing effective vessel capacity
- Contraction in ex-China steel
production as well as demand for certain raw materials
Supply and demand factors for the
drybulk market for the balance of the year
- Historically low orderbook as a
percentage of the fleet
- Environmental regulations
- Additional stimulus from China to
boost demand and support the property sector
- Increased Brazilian iron ore
volumes with a seasonal weighting to 2H
- Developments regarding the Black
Sea Grain Initiative
Financial Review: Six Months
2023
The Company recorded net income of $14.2 million
or $0.33 basic and diluted earnings per share for the six months
ended June 30, 2023, respectively. This compares to net income of
$89.1 million or $2.11 and $2.07 basic and diluted earnings per
share for the six months ended June 30, 2022.
Revenue / TCEThe Company’s
revenues decreased to $184.9 million for the six months ended June
30, 2023 compared to $274.0 million for the six months ended June
30, 2022, primarily due to lower rates achieved by our minor and
major bulk vessels. TCE rates obtained by the Company decreased to
$14,757 per day for the six months ended June 30, 2023 from $26,354
per day for the six months ended June 30, 2022.
Voyage expensesVoyage expenses
decreased to $66.3 million for the six months ended June 30, 2023
from $70.9 million for the same period in 2022, primarily due to
lower bunker consumption for our minor bulk vessels, as well as
decreased fuel prices during the second quarter of 2023 as compared
to the same period during 2022.
Vessel operating expensesVessel
operating expenses decreased to $47.0 million for the six months
ended June 30, 2023 from $56.5 million for the six months ended
June 30, 2022. DVOE was $5,899 for the year-to-date period in 2023
versus $7,100 in 2022. The decrease was primarily due to lower
COVID-19 related expenses in 2023 over the same period last year, a
decrease in the purchase of stores and spare parts, as well as
reduced repair and maintenance costs.
General and administrative
expensesGeneral and administrative expenses for the six
months ended June 30, 2023 increased to $14.7 million as compared
to the $12.4 million in the same period of 2022 primarily due to an
increase in non-cash stock amortization expense as well as higher
legal and professional fees.
EBITDAEBITDA for the six months
ended June 30, 2023 amounted to $49.8 million compared to $122.2
million during the prior period. During the six months of 2023 and
2022, EBITDA included gains and losses on fuel hedges. Excluding
these items, our adjusted EBITDA would have amounted to $49.9
million and $120.5 million, for the respective periods.
Liquidity and Capital
Resources
Cash Flow
Net cash provided by operating
activities for the six months ended June 30, 2023 and 2022
was $38.9 million and $99.2 million, respectively. This decrease in
cash provided by operating activities was primarily due to lower
rates earned by our minor and major bulk vessels and changes in
working capital. These decreases were partially offset by a
decrease in drydocking costs incurred during the six months ended
June 30, 2023 as compared to the six months ended June 30,
2022.
Net cash used in investing
activities for the six months ended June 30, 2023 and 2022
was $3.5 million and $50.0 million, respectively. This decrease was
primarily due to a $45.2 million decrease in the purchase of
vessels primarily as a result of the purchase of two Ultramax
vessels that delivered during the first quarter of 2022.
Net cash used in financing
activities during the six months ended June 30, 2023 and
2022 was $45.6 million and $119.1 million, respectively. The
decrease is primarily due to the additional $40.0 million debt
repayment made under the $450 Million Credit Facility during the
first quarter of 2022. Additionally, there was a $33.4 million
decrease in the payment of dividends during the first half of 2023
as compared to the same period during 2022.
Capital Expenditures
Genco’s fleet of 44 vessels as of August 3,
2023, consists of:
- 17 Capesizes
- 15 Ultramaxes
- 12 Supramaxes
The fleet’s average age is 11.4 years and has an
aggregate capacity of approximately 4,635,000 dwt.
In addition to acquisitions that we may
undertake, we will incur additional capital expenditures due to
special surveys and drydockings. Furthermore, we plan to upgrade a
portion of our fleet with energy saving devices and apply high
performance paint systems to our vessels in order to reduce fuel
consumption and emissions.
We estimate our capital expenditures related to
drydocking, including capitalized costs incurred during drydocking
related to vessel assets and vessel equipment, ballast water
treatment system costs, fuel efficiency upgrades and scheduled
off-hire days for our fleet for the balance of 2023 and 2024 to
be:
Estimated costs ($ in millions) |
Q3 2023 |
Q4 2023 |
Q1 2024 |
Q2 2024 |
Q3 2024 |
Q4 2024 |
Drydock Costs (1) |
$ |
3.18 |
$ |
- |
$ |
1.00 |
$ |
6.05 |
$ |
5.65 |
$ |
6.65 |
Fuel Efficiency Upgrade Costs (2) |
$ |
2.37 |
$ |
- |
$ |
0.14 |
$ |
1.50 |
$ |
1.09 |
$ |
1.23 |
Total Costs |
$ |
5.55 |
$ |
- |
$ |
1.14 |
$ |
7.55 |
$ |
6.74 |
$ |
7.88 |
Estimated Offhire Days (3) |
|
70 |
|
- |
|
25 |
|
120 |
|
115 |
|
125 |
|
|
|
|
|
|
|
(1) Estimates are based on our budgeted cost of
drydocking our vessels in China. Actual costs will vary based on
various factors, including where the drydockings are actually
performed. We expect to fund these costs with cash on hand. These
costs do not include drydock expense items that are reflected in
vessel operating expenses.
(2) Estimated costs associated with the
installation of fuel efficiency upgrades are expected to be funded
with cash on hand.
(3) Actual length will vary based on the
condition of the vessel, yard schedules and other factors. The
estimated offhire days per sector scheduled for Q3 2023 consists of
70 days for two Supramax vessels.
Summary Consolidated Financial and Other
Data
The following table summarizes Genco Shipping
& Trading Limited’s selected consolidated financial and other
data for the periods indicated below.
|
|
|
|
Three Months Ended June 30, 2023 |
|
Three Months Ended June 30, 2022 |
|
Six Months Ended June 30, 2023 |
|
Six Months Ended June 30, 2022 |
|
|
|
|
(Dollars in thousands, except share and per share data) |
|
(Dollars in thousands, except share and per share data) |
|
|
|
|
(unaudited) |
|
(unaudited) |
INCOME
STATEMENT DATA: |
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
Voyage
revenues |
$ |
90,556 |
|
|
$ |
137,764 |
|
|
$ |
184,947 |
|
|
$ |
273,991 |
|
|
|
Total revenues |
|
90,556 |
|
|
|
137,764 |
|
|
|
184,947 |
|
|
|
273,991 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Voyage
expenses |
|
28,830 |
|
|
|
32,460 |
|
|
|
66,265 |
|
|
|
70,924 |
|
|
Vessel operating
expenses |
|
22,586 |
|
|
|
29,463 |
|
|
|
46,979 |
|
|
|
56,477 |
|
|
Charter hire
expenses |
|
1,040 |
|
|
|
5,044 |
|
|
|
4,705 |
|
|
|
12,682 |
|
|
General
and administrative expenses (inclusive of nonvested stock
amortization |
|
6,933 |
|
|
|
6,381 |
|
|
|
14,682 |
|
|
|
12,424 |
|
|
expense
of $1.2 million, $0.8 million, $2.8 million and $1.5 million,
respectively) |
|
|
|
|
|
|
|
|
Technical
management fees |
|
1,349 |
|
|
|
700 |
|
|
|
2,111 |
|
|
|
1,617 |
|
|
Depreciation and
amortization |
|
16,791 |
|
|
|
14,521 |
|
|
|
32,736 |
|
|
|
28,579 |
|
|
|
Total operating
expenses |
|
77,529 |
|
|
|
88,569 |
|
|
|
167,478 |
|
|
|
182,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
13,027 |
|
|
|
49,195 |
|
|
|
17,469 |
|
|
|
91,288 |
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
Other income
(expense) |
|
125 |
|
|
|
767 |
|
|
|
(198 |
) |
|
|
2,764 |
|
|
Interest
income |
|
520 |
|
|
|
68 |
|
|
|
1,290 |
|
|
|
85 |
|
|
Interest
expense |
|
(2,131 |
) |
|
|
(2,405 |
) |
|
|
(4,160 |
) |
|
|
(4,647 |
) |
|
|
Other expense,
net |
|
(1,486 |
) |
|
|
(1,570 |
) |
|
|
(3,068 |
) |
|
|
(1,798 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
11,541 |
|
|
$ |
47,625 |
|
|
$ |
14,401 |
|
|
$ |
89,490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net (loss)
income attributable to noncontrolling interest |
|
(21 |
) |
|
|
243 |
|
|
|
205 |
|
|
$ |
419 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genco Shipping & Trading Limited |
$ |
11,562 |
|
|
$ |
47,382 |
|
|
$ |
14,196 |
|
|
$ |
89,071 |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
- basic |
$ |
0.27 |
|
|
$ |
1.12 |
|
|
$ |
0.33 |
|
|
$ |
2.11 |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
- diluted |
$ |
0.27 |
|
|
$ |
1.10 |
|
|
$ |
0.33 |
|
|
$ |
2.07 |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - basic |
|
42,786,918 |
|
|
|
42,385,423 |
|
|
|
42,709,916 |
|
|
|
42,276,371 |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - diluted |
|
43,134,152 |
|
|
|
42,996,676 |
|
|
|
43,115,859 |
|
|
|
42,932,370 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2023 |
|
December 31, 2022 |
BALANCE
SHEET DATA (Dollars in thousands): |
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
$ |
47,934 |
|
|
$ |
58,142 |
|
|
|
Restricted
cash |
|
|
|
5,643 |
|
|
|
5,643 |
|
|
|
Due from
charterers, net |
|
|
|
19,693 |
|
|
|
25,333 |
|
|
|
Prepaid expenses
and other current assets |
|
|
|
10,420 |
|
|
|
8,399 |
|
|
|
Inventories |
|
|
|
22,962 |
|
|
|
21,601 |
|
|
|
Fair value of
derivative instruments |
|
|
|
4,030 |
|
|
|
6,312 |
|
|
Total current
assets |
|
|
|
110,682 |
|
|
|
125,430 |
|
|
|
|
|
|
|
|
|
|
|
Noncurrent
assets: |
|
|
|
|
|
|
|
Vessels, net of
accumulated depreciation of $328,339 and $303,098,
respectively |
|
|
|
979,054 |
|
|
|
1,002,810 |
|
|
|
Deferred drydock,
net |
|
|
|
33,858 |
|
|
|
32,254 |
|
|
|
Fixed assets,
net |
|
|
|
8,127 |
|
|
|
8,556 |
|
|
|
Operating lease
right-of-use assets |
|
|
|
3,357 |
|
|
|
4,078 |
|
|
|
Restricted
cash |
|
|
|
315 |
|
|
|
315 |
|
|
|
Fair value of
derivative instruments |
|
|
|
- |
|
|
|
423 |
|
|
Total noncurrent
assets |
|
|
|
1,024,711 |
|
|
|
1,048,436 |
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
$ |
1,135,393 |
|
|
$ |
1,173,866 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts payable
and accrued expenses |
|
|
$ |
19,042 |
|
|
$ |
29,475 |
|
|
|
Deferred
revenue |
|
|
|
7,945 |
|
|
|
4,958 |
|
|
|
Current operating
lease liabilities |
|
|
|
2,237 |
|
|
|
2,107 |
|
|
Total current
liabilities |
|
|
|
29,224 |
|
|
|
36,540 |
|
|
|
|
|
|
|
|
|
|
|
Noncurrent
liabilities |
|
|
|
|
|
|
|
Long-term
operating lease liabilities |
|
|
|
2,963 |
|
|
|
4,096 |
|
|
|
Long-term debt,
net of deferred financing costs of $5,239 and $6,079,
respectively |
|
|
|
148,261 |
|
|
|
164,921 |
|
|
Total noncurrent
liabilities |
|
|
|
151,224 |
|
|
|
169,017 |
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities |
|
|
|
180,448 |
|
|
|
205,557 |
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
Common stock |
|
|
|
425 |
|
|
|
423 |
|
|
|
Additional paid-in
capital |
|
|
|
1,563,631 |
|
|
|
1,588,777 |
|
|
|
Accumulated other
comprehensive income |
|
|
|
3,859 |
|
|
|
6,480 |
|
|
|
Accumulated
deficit |
|
|
|
(614,051 |
) |
|
|
(628,247 |
) |
|
|
|
|
|
|
|
|
|
|
Total Genco
Shipping & Trading Limited shareholders' equity |
|
|
|
953,864 |
|
|
|
967,433 |
|
|
|
Noncontrolling
interest |
|
|
|
1,081 |
|
|
|
876 |
|
|
Total equity |
|
|
|
954,945 |
|
|
|
968,309 |
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and equity |
|
|
$ |
1,135,393 |
|
|
$ |
1,173,866 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2023 |
|
Six Months Ended June 30, 2022 |
STATEMENT
OF CASH FLOWS (Dollars in thousands): |
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
Cash flows
from operating activities |
|
|
|
|
|
|
|
Net income |
|
|
$ |
14,401 |
|
|
$ |
89,490 |
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities: |
|
|
|
|
|
|
|
Depreciation and
amortization |
|
|
|
32,736 |
|
|
|
28,579 |
|
|
|
Amortization of
deferred financing costs |
|
|
|
840 |
|
|
|
841 |
|
|
|
Right-of-use asset
amortization |
|
|
|
721 |
|
|
|
705 |
|
|
|
Amortization of
nonvested stock compensation expense |
|
|
|
2,778 |
|
|
|
1,516 |
|
|
|
Amortization of
premium on derivatives |
|
|
|
84 |
|
|
|
110 |
|
|
|
Insurance proceeds
for protection and indemnity claims |
|
|
|
168 |
|
|
|
169 |
|
|
|
Insurance proceeds
for loss of hire claims |
|
|
|
152 |
|
|
|
- |
|
|
|
Change in assets
and liabilities: |
|
|
|
|
|
|
|
|
Decrease (increase) in due from charterers |
|
|
|
5,640 |
|
|
|
(4,847 |
) |
|
|
|
(Increase) decrease in prepaid
expenses and other current assets |
|
|
|
(3,743 |
) |
|
|
584 |
|
|
|
|
Increase in inventories |
|
|
|
(1,361 |
) |
|
|
(7,177 |
) |
|
|
|
(Decrease) increase in
accounts payable and accrued expenses |
|
|
|
(7,708 |
) |
|
|
8,602 |
|
|
|
|
Increase (decrease) in
deferred revenue |
|
|
|
2,987 |
|
|
|
(4,292 |
) |
|
|
|
Decrease in operating lease
liabilities |
|
|
|
(1,003 |
) |
|
|
(917 |
) |
|
|
|
Deferred drydock costs
incurred |
|
|
|
(7,744 |
) |
|
|
(14,204 |
) |
|
|
Net cash provided
by operating activities |
|
|
|
38,948 |
|
|
|
99,159 |
|
|
|
|
|
|
|
|
|
|
Cash flows
from investing activities |
|
|
|
|
|
|
|
Purchase of
vessels and ballast water treatment systems, including
deposits |
|
|
|
(3,131 |
) |
|
|
(48,346 |
) |
|
|
Purchase of other
fixed assets |
|
|
|
(1,802 |
) |
|
|
(1,927 |
) |
|
|
Insurance proceeds
for hull and machinery claims |
|
|
|
1,402 |
|
|
|
293 |
|
|
|
Net cash used in
investing activities |
|
|
|
(3,531 |
) |
|
|
(49,980 |
) |
|
|
|
|
|
|
|
|
|
Cash flows
from financing activities |
|
|
|
|
|
|
|
Repayments on the
$450 Million Credit Facility |
|
|
|
(17,500 |
) |
|
|
(57,500 |
) |
|
|
Cash dividends
paid |
|
|
|
(28,125 |
) |
|
|
(61,572 |
) |
|
|
Payment of
deferred financing costs |
|
|
|
- |
|
|
|
(11 |
) |
|
|
Net cash used in
financing activities |
|
|
|
(45,625 |
) |
|
|
(119,083 |
) |
|
|
|
|
|
|
|
|
|
Net decrease in
cash, cash equivalents and restricted cash |
|
|
|
(10,208 |
) |
|
|
(69,904 |
) |
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash at beginning of period |
|
|
|
64,100 |
|
|
|
120,531 |
|
Cash, cash
equivalents and restricted cash at end of period |
|
|
$ |
53,892 |
|
|
$ |
50,627 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2023 |
Net Income
Reconciliation |
(unaudited) |
Net income
attributable to Genco Shipping & Trading Limited |
$ |
11,562 |
|
+ |
|
Unrealized loss on fuel hedges |
|
38 |
|
|
|
Adjusted net
income |
$ |
11,600 |
|
|
|
|
|
|
|
|
Earnings per share -
basic |
$ |
0.27 |
|
|
|
Earnings per share -
diluted |
$ |
0.27 |
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding - basic |
|
42,786,918 |
|
|
|
Weighted average common shares
outstanding - diluted |
|
43,134,152 |
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding - basic as per financial statements |
|
42,786,918 |
|
|
|
Dilutive effect of stock
options |
|
170,198 |
|
|
|
Dilutive effect of performance
based restricted stock units |
|
54,712 |
|
|
|
Dilutive effect of restricted
stock units |
|
122,324 |
|
|
|
Weighted average common shares
outstanding - diluted as adjusted |
|
43,134,152 |
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2023 |
|
Three Months Ended June 30, 2022 |
|
Six Months Ended June 30, 2023 |
|
Six Months Ended June 30, 2022 |
|
|
|
|
(Dollars in thousands) |
|
(Dollars in thousands) |
EBITDA
Reconciliation: |
(unaudited) |
|
(unaudited) |
|
Net income
attributable to Genco Shipping & Trading Limited |
$ |
11,562 |
|
|
$ |
47,382 |
|
|
$ |
14,196 |
|
|
$ |
89,071 |
|
|
+ |
|
Net interest expense |
|
1,611 |
|
|
|
2,337 |
|
|
|
2,870 |
|
|
|
4,562 |
|
|
+ |
|
Depreciation and
amortization |
|
16,791 |
|
|
|
14,521 |
|
|
|
32,736 |
|
|
|
28,579 |
|
|
|
|
EBITDA(1) |
$ |
29,964 |
|
|
$ |
64,240 |
|
|
$ |
49,802 |
|
|
$ |
122,212 |
|
|
|
|
|
|
|
|
|
|
|
|
|
+ |
|
Unrealized loss (gain) on fuel
hedges |
|
38 |
|
|
|
(321 |
) |
|
|
80 |
|
|
|
(1,760 |
) |
|
|
|
Adjusted
EBITDA |
$ |
30,002 |
|
|
$ |
63,919 |
|
|
$ |
49,882 |
|
|
$ |
120,452 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
|
June 30, 2023 |
|
June 30, 2022 |
|
June 30, 2023 |
|
June 30, 2022 |
FLEET
DATA: |
(unaudited) |
|
(unaudited) |
Total number of
vessels at end of period |
|
44 |
|
|
|
44 |
|
|
|
44 |
|
|
|
44 |
|
Average number of
vessels (2) |
|
44.0 |
|
|
|
44.0 |
|
|
|
44.0 |
|
|
|
43.9 |
|
Total ownership
days for fleet (3) |
|
4,004 |
|
|
|
4,004 |
|
|
|
7,964 |
|
|
|
7,954 |
|
Total chartered-in
days (4) |
|
70 |
|
|
|
146 |
|
|
|
306 |
|
|
|
457 |
|
Total available
days for fleet (5) |
|
3,969 |
|
|
|
3,656 |
|
|
|
8,035 |
|
|
|
7,730 |
|
Total available
days for owned fleet (6) |
|
3,899 |
|
|
|
3,510 |
|
|
|
7,729 |
|
|
|
7,273 |
|
Total operating
days for fleet (7) |
|
3,919 |
|
|
|
3,611 |
|
|
|
7,898 |
|
|
|
7,568 |
|
Fleet utilization
(8) |
|
97.8 |
% |
|
|
97.2 |
% |
|
|
97.2 |
% |
|
|
95.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE
DAILY RESULTS: |
|
|
|
|
|
|
|
Time charter
equivalent (9) |
$ |
15,556 |
|
|
$ |
28,756 |
|
|
$ |
14,757 |
|
|
$ |
26,354 |
|
Daily vessel
operating expenses per vessel (10) |
|
5,641 |
|
|
|
7,358 |
|
|
|
5,899 |
|
|
|
7,100 |
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
|
June 30, 2023 |
|
June 30, 2022 |
|
June 30, 2023 |
|
June 30, 2022 |
FLEET
DATA: |
(unaudited) |
|
(unaudited) |
Ownership
days |
|
|
|
|
|
|
|
Capesize |
|
1,547.0 |
|
|
|
1,547.0 |
|
|
|
3,077.0 |
|
|
|
3,077.0 |
|
Ultramax |
|
1,365.0 |
|
|
|
1,365.0 |
|
|
|
2,715.0 |
|
|
|
2,704.9 |
|
Supramax |
|
1,092.0 |
|
|
|
1,092.0 |
|
|
|
2,172.0 |
|
|
|
2,172.0 |
|
Total |
|
|
4,004.0 |
|
|
|
4,004.0 |
|
|
|
7,964.0 |
|
|
|
7,953.9 |
|
|
|
|
|
|
|
|
|
|
|
|
Chartered-in
days |
|
|
|
|
|
|
|
Capesize |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Ultramax |
|
50.3 |
|
|
|
- |
|
|
|
239.7 |
|
|
|
190.3 |
|
Supramax |
|
19.7 |
|
|
|
145.7 |
|
|
|
65.9 |
|
|
|
266.3 |
|
Total |
|
|
70.0 |
|
|
|
145.7 |
|
|
|
305.6 |
|
|
|
456.6 |
|
|
|
|
|
|
|
|
|
|
|
|
Available days
(owned & chartered-in fleet) |
|
|
|
|
|
|
|
Capesize |
|
1,543.2 |
|
|
|
1,108.5 |
|
|
|
2,984.0 |
|
|
|
2,610.4 |
|
Ultramax |
|
1,404.9 |
|
|
|
1,341.7 |
|
|
|
2,940.4 |
|
|
|
2,792.7 |
|
Supramax |
|
1,021.1 |
|
|
|
1,205.3 |
|
|
|
2,110.3 |
|
|
|
2,326.8 |
|
Total |
|
|
3,969.2 |
|
|
|
3,655.5 |
|
|
|
8,034.7 |
|
|
|
7,729.9 |
|
|
|
|
|
|
|
|
|
|
|
|
Available days
(owned fleet) |
|
|
|
|
|
|
|
Capesize |
|
1,543.2 |
|
|
|
1,108.5 |
|
|
|
2,984.0 |
|
|
|
2,610.4 |
|
Ultramax |
|
1,354.6 |
|
|
|
1,341.7 |
|
|
|
2,700.7 |
|
|
|
2,602.4 |
|
Supramax |
|
1,001.4 |
|
|
|
1,059.6 |
|
|
|
2,044.4 |
|
|
|
2,060.5 |
|
Total |
|
|
3,899.2 |
|
|
|
3,509.8 |
|
|
|
7,729.1 |
|
|
|
7,273.3 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
days |
|
|
|
|
|
|
|
Capesize |
|
1,532.1 |
|
|
|
1,100.7 |
|
|
|
2,965.3 |
|
|
|
2,555.9 |
|
Ultramax |
|
1,383.7 |
|
|
|
1,327.4 |
|
|
|
2,857.5 |
|
|
|
2,760.2 |
|
Supramax |
|
1,003.1 |
|
|
|
1,182.6 |
|
|
|
2,075.2 |
|
|
|
2,251.9 |
|
Total |
|
|
3,918.9 |
|
|
|
3,610.7 |
|
|
|
7,898.0 |
|
|
|
7,568.0 |
|
|
|
|
|
|
|
|
|
|
|
|
Fleet
utilization |
|
|
|
|
|
|
|
Capesize |
|
99.0 |
% |
|
|
97.7 |
% |
|
|
98.8 |
% |
|
|
96.9 |
% |
Ultramax |
|
97.8 |
% |
|
|
98.4 |
% |
|
|
96.7 |
% |
|
|
96.6 |
% |
Supramax |
|
95.9 |
% |
|
|
95.5 |
% |
|
|
95.6 |
% |
|
|
93.1 |
% |
Fleet average |
|
97.8 |
% |
|
|
97.2 |
% |
|
|
97.2 |
% |
|
|
95.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
Average
Daily Results: |
|
|
|
|
|
|
|
Time Charter
Equivalent |
|
|
|
|
|
|
|
Capesize |
$ |
19,468 |
|
|
$ |
27,034 |
|
|
$ |
17,759 |
|
|
$ |
25,649 |
|
Ultramax |
|
13,739 |
|
|
|
29,045 |
|
|
|
14,307 |
|
|
|
27,312 |
|
Supramax |
|
11,984 |
|
|
|
30,193 |
|
|
|
10,977 |
|
|
|
26,032 |
|
Fleet average |
|
15,556 |
|
|
|
28,756 |
|
|
|
14,757 |
|
|
|
26,354 |
|
|
|
|
|
|
|
|
|
|
|
|
Daily vessel
operating expenses |
|
|
|
|
|
|
|
Capesize |
$ |
5,928 |
|
|
$ |
6,816 |
|
|
$ |
6,247 |
|
|
$ |
6,716 |
|
Ultramax |
|
5,174 |
|
|
|
5,732 |
|
|
|
5,365 |
|
|
|
5,922 |
|
Supramax |
|
5,979 |
|
|
|
10,161 |
|
|
|
6,153 |
|
|
|
9,100 |
|
Fleet average |
|
5,641 |
|
|
|
7,358 |
|
|
|
5,899 |
|
|
|
7,100 |
|
|
|
|
|
|
|
|
|
|
|
|
1) EBITDA represents net income
attributable to Genco Shipping & Trading Limited plus net
interest expense, taxes, and depreciation and amortization. EBITDA
is included because it is used by management and certain investors
as a measure of operating performance. EBITDA is used by analysts
in the shipping industry as a common performance measure to compare
results across peers. Our management uses EBITDA as a performance
measure in consolidating internal financial statements and it is
presented for review at our board meetings. We believe that EBITDA
is useful to investors as the shipping industry is capital
intensive which often results in significant depreciation and cost
of financing. EBITDA presents investors with a measure in addition
to net income to evaluate our performance prior to these costs.
EBITDA is not an item recognized by U.S. GAAP (i.e. non-GAAP
measure) and should not be considered as an alternative to net
income, operating income or any other indicator of a company's
operating performance required by U.S. GAAP. EBITDA is not a
measure of liquidity or cash flows as shown in our consolidated
statement of cash flows. The definition of EBITDA used here may not
be comparable to that used by other companies.
2) Average number of vessels is
the number of vessels that constituted our fleet for the relevant
period, as measured by the sum of the number of days each vessel
was part of our fleet during the period divided by the number of
calendar days in that period.3) We define
ownership days as the aggregate number of days in a period during
which each vessel in our fleet has been owned by us. Ownership days
are an indicator of the size of our fleet over a period and affect
both the amount of revenues and the amount of expenses that we
record during a period.4) We define chartered-in
days as the aggregate number of days in a period during which we
chartered-in third-party vessels. 5) We define
available days as the number of our ownership days and chartered-in
days less the aggregate number of days that our vessels are
off-hire due to familiarization upon acquisition, repairs or
repairs under guarantee, vessel upgrades or special surveys.
Companies in the shipping industry generally use available days to
measure the number of days in a period during which vessels should
be capable of generating revenues. 6) We define
available days for the owned fleet as available days less
chartered-in days.7) We define operating days as
the number of our total available days in a period less the
aggregate number of days that the vessels are off-hire due to
unforeseen circumstances. The shipping industry uses operating days
to measure the aggregate number of days in a period during which
vessels actually generate revenues. 8) We
calculate fleet utilization as the number of our operating days
during a period divided by the number of ownership days plus
chartered-in days less drydocking days. 9) We
define TCE rates as our voyage revenues less voyage expenses,
charter hire expenses, and realized gain or losses on fuel hedges,
divided by the number of the available days of our owned fleet
during the period. TCE rate is a common shipping
industry performance measure used primarily to compare daily
earnings generated by vessels on time charters with daily earnings
generated by vessels on voyage charters, because charterhire rates
for vessels on voyage charters are generally not expressed in
per-day amounts while charterhire rates for vessels on time
charters generally are expressed in such amounts. Our estimated TCE
for the third quarter of 2023 is based on fixtures booked to date.
Actual results may vary based on the actual duration of voyages and
other factors. Accordingly, we are unable to provide, without
unreasonable efforts, a reconciliation of estimated TCE for the
third quarter to the most comparable financial measures presented
in accordance with GAAP. When we compare our TCE to the Baltic
Supramax Index (BSI) in this release, we adjust the BSI for
customary commissions.
|
|
Three Months Ended June 30, 2023 |
|
Three Months Ended June 30, 2022 |
|
Six Months Ended June 30, 2023 |
|
Six Months Ended June 30, 2022 |
Total
Fleet |
(unaudited) |
|
(unaudited) |
Voyage revenues
(in thousands) |
$ |
90,556 |
|
|
$ |
137,764 |
|
|
$ |
184,947 |
|
|
$ |
273,991 |
|
Voyage expenses
(in thousands) |
|
28,830 |
|
|
|
32,460 |
|
|
|
66,265 |
|
|
|
70,924 |
|
Charter hire
expenses (in thousands) |
|
1,040 |
|
|
|
5,044 |
|
|
|
4,705 |
|
|
|
12,682 |
|
Realized (loss)
gain on fuel hedges (in thousands) |
|
(27 |
) |
|
|
667 |
|
|
|
81 |
|
|
|
1,296 |
|
|
|
|
60,659 |
|
|
|
100,927 |
|
|
|
114,058 |
|
|
|
191,681 |
|
|
|
|
|
|
|
|
|
|
Total available
days for owned fleet |
|
3,899 |
|
|
|
3,510 |
|
|
|
7,729 |
|
|
|
7,273 |
|
Total TCE
rate |
$ |
15,556 |
|
|
$ |
28,756 |
|
|
$ |
14,757 |
|
|
$ |
26,354 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10) We define daily vessel
operating expenses to include crew wages and related costs, the
cost of insurance expenses relating to repairs and maintenance
(excluding drydocking), the costs of spares and consumable stores,
tonnage taxes and other miscellaneous expenses. Daily vessel
operating expenses are calculated by dividing vessel operating
expenses by ownership days for the relevant period.
About Genco Shipping & Trading
Limited
Genco Shipping & Trading Limited is a U.S.
based drybulk ship owning company focused on the seaborne
transportation of commodities globally. We provide a full-service
logistics solution to our customers utilizing our in-house
commercial operating platform, as we transport key cargoes such as
iron ore, grain, steel products, bauxite, cement, nickel ore among
other commodities along worldwide shipping routes. Our wholly owned
high quality, modern fleet of dry cargo vessels consists of the
larger Capesize (major bulk) and the medium-sized Ultramax and
Supramax vessels (minor bulk) enabling us to carry a wide range of
cargoes. We make capital expenditures from time to time in
connection with vessel acquisitions. As of August 3, 2023, Genco
Shipping & Trading Limited’s fleet consists of 17 Capesize, 15
Ultramax and 12 Supramax vessels with an aggregate capacity of
approximately 4,635,000 dwt and an average age of 11.4 years.
Conference Call Announcement
Genco Shipping & Trading Limited will hold a
conference call on Friday, August 4, 2023 at 10:00 a.m.
Eastern Time to discuss its 2023 second quarter financial results.
The conference call and a presentation will be simultaneously
webcast and will be available on the Company’s website,
www.GencoShipping.com. To access the conference call, dial (416)
764-8624 or (888) 259-6580 and enter passcode 028452. A replay of
the conference call can also be accessed for two weeks by dialing
(416) 764-8692 or (877) 674-7070 and entering the passcode 028452.
The Company intends to place additional materials related to the
earnings announcement, including a slide presentation, on its
website prior to the conference call.
Website Information
We intend to use our website,
www.GencoShipping.com, as a means of disclosing material non-public
information and for complying with our disclosure obligations under
Regulation FD. Such disclosures will be included in our website’s
Investor Relations section. Accordingly, investors should monitor
the Investor Relations portion of our website, in addition to
following our press releases, SEC filings, public conference calls,
and webcasts. To subscribe to our e-mail alert service, please
click the “Receive E-mail Alerts” link in the Investor Relations
section of our website and submit your email address. The
information contained in, or that may be accessed through, our
website is not incorporated by reference into or a part of this
document or any other report or document we file with or furnish to
the SEC, and any references to our website are intended to be
inactive textual references only.
"Safe Harbor" Statement under the Private
Securities Litigation Reform Act of 1995
This release contains forward-looking statements
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Such
forward-looking statements use words such as “anticipate,”
“budget,” “estimate,” “expect,” “project,” “intend,” “plan,”
“believe,” and other words and terms of similar meaning in
connection with a discussion of potential future events,
circumstances or future operating or financial performance.
These forward-looking statements are based on our management’s
current expectations and observations. Included among the
factors that, in our view, could cause actual results to differ
materially from the forward looking statements contained in this
release are the following: (i) declines or sustained weakness
in demand in the drybulk shipping industry; (ii) weakness or
declines in drybulk shipping rates; (iii) changes in the
supply of or demand for drybulk products, generally or in
particular regions; (iv) changes in the supply of drybulk
carriers including newbuilding of vessels or lower than anticipated
scrapping of older vessels; (v) changes in rules and
regulations applicable to the cargo industry, including, without
limitation, legislation adopted by international organizations or
by individual countries and actions taken by regulatory
authorities; (vi) increases in costs and expenses including
but not limited to: crew wages, insurance, provisions, lube oil,
bunkers, repairs, maintenance, general and administrative expenses,
and management fee expenses; (vii) whether our insurance
arrangements are adequate; (viii) changes in general domestic
and international political conditions; (ix) acts of war,
terrorism, or piracy, including without limitation the ongoing war
in Ukraine; (x) changes in the condition of the Company’s
vessels or applicable maintenance or regulatory standards (which
may affect, among other things, our anticipated drydocking or
maintenance and repair costs) and unanticipated drydock
expenditures; (xi) the Company’s acquisition or disposition of
vessels; (xii) the amount of offhire time needed to complete
maintenance, repairs, and installation of equipment to comply with
applicable regulations on vessels and the timing and amount of any
reimbursement by our insurance carriers for insurance claims,
including offhire days; (xiii) the completion of definitive
documentation with respect to charters; (xiv) charterers’
compliance with the terms of their charters in the current market
environment; (xv) the extent to which our operating results
are affected by weakness in market conditions and freight and
charter rates; (xvi) our ability to maintain contracts that
are critical to our operation, to obtain and maintain acceptable
terms with our vendors, customers and service providers and to
retain key executives, managers and employees; (xvii) completion of
documentation for vessel transactions and the performance of the
terms thereof by buyers or sellers of vessels and us; (xviii) the
relative cost and availability of low sulfur and high sulfur fuel,
worldwide compliance with sulfur emissions regulations that took
effect on January 1, 2020 and our ability to realize the economic
benefits or recover the cost of the scrubbers we have installed;
(xix) our financial results for the year ending December 31, 2023
and other factors relating to determination of the tax treatment of
dividends we have declared; (xx) the financial results we achieve
for each quarter that apply to the formula under our new dividend
policy, including without limitation the actual amounts earned by
our vessels and the amounts of various expenses we incur, as a
significant decrease in such earnings or a significant increase in
such expenses may affect our ability to carry out our new value
strategy; (xxi) the exercise of the discretion of our Board
regarding the declaration of dividends, including without
limitation the amount that our Board determines to set aside for
reserves under our dividend policy; (xxii) the duration and impact
of the COVID-19 novel coronavirus epidemic, which may negatively
affect general global and regional economic conditions, our ability
to charter our vessels at all and the rates at which are able to do
so; our ability to call on or depart from ports on a timely basis
or at all; our ability to crew, maintain, and repair our vessels,
including without limitation the impact diversion of our vessels to
perform crew rotations may have on our revenues, expenses, and
ability to consummate vessel sales, expense and disruption to our
operations that may arise from the inability to rotate crews on
schedule, and delay and added expense we may incur in rotating
crews in the current environment; our ability to staff and maintain
our headquarters and administrative operations; sources of cash and
liquidity; our ability to sell vessels in the secondary market,
including without limitation the compliance of purchasers and us
with the terms of vessel sale contracts, and the prices at which
vessels are sold; and other factors relevant to our business
described from time to time in our filings with the Securities and
Exchange Commission; and (xxiii) other factors listed from
time to time in our filings with the Securities and Exchange
Commission, including, without limitation, our Annual Report on
Form 10-K for the year ended December 31, 2022 and subsequent
reports on Form 8-K and Form 10-Q). Our ability to pay
dividends in any period will depend upon various factors, including
the limitations under any credit agreements to which we may be a
party, applicable provisions of Marshall Islands law and the final
determination by the Board of Directors each quarter after its
review of our financial performance, market developments, and the
best interests of the Company and its shareholders. The timing and
amount of dividends, if any, could also be affected by factors
affecting cash flows, results of operations, required capital
expenditures, or reserves. As a result, the amount of dividends
actually paid may vary. We do not undertake any obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
CONTACT:Peter AllenChief
Financial OfficerGenco Shipping & Trading Limited(646)
443-8550
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