Star Bulk Carriers (SBLK) 6-KManagement’s Discussion and Analysis of Financial Condition and Results of Operations

Exhibit 99.1

The following is a discussion of the financial condition and results of operations of Star Bulk Carriers Corp. (“Star Bulk”) for the nine-month periods ended September 30, 2022 and 2023. Unless otherwise specified herein, references to the “Company,” “we,” “us” or “our” shall include Star Bulk and its subsidiaries. You should read the following discussion and analysis together with the unaudited interim condensed consolidated financial statements and related notes included elsewhere herein. For additional information relating to our management’s discussion and analysis of financial conditions and results of operations, please see our Annual Report on Form 20‑F for the year ended December 31, 2022, which was filed with the U.S. Securities and Exchange Commission (the “Commission”) on March 7, 2023 (the “2022 Annual Report”). Unless otherwise defined herein, capitalized words and expressions used herein shall have the same meanings ascribed to them in the 2022 Annual Report. This discussion includes forward-looking statements which, although based on assumptions that we consider reasonable, are subject to risks and uncertainties which could cause actual events or conditions to differ materially from those currently anticipated and expressed or implied by such forward-looking statements.

Overview

We are a global shipping company providing worldwide seaborne transportation solutions in the dry bulk sector. Our vessels transport major bulks, which include iron ore, coal and grain, and minor bulks which include bauxite, fertilizers and steel products. We were incorporated in the Marshall Islands on December 13, 2006 and, on December 3, 2007, we commenced operations when we took delivery of our first vessel. We maintain offices in Athens, New York, Limassol, Singapore and Germany. Our common shares trade on the Nasdaq Global Select Market under the symbol “SBLK.”

Our Fleet

During the first quarter of 2023, we agreed with the war risk insurers of the vessel Star Pavlina, that the vessel became a constructive total loss on February 24, 2023, given its prolonged detainment in Ukraine following the commencement of Russia’s military action against Ukraine on February 24, 2022.

During the nine-month period ended September 30, 2023, we decided to strategically sell certain vessels and renew our fleet, taking advantage of the elevated vessel market values. In particular, in March 2023, we agreed to sell the vessels Star Borealis and Star Polaris which were delivered to their new owner on May 4, 2023 and on July 7, 2023, respectively. In May 2023, we agreed to sell the vessels Star Centaurus, Star Columba, Star Aquila, Star Hercules and Star Cepheus. Star Centaurus, Star Columba and Star Aquila were delivered to their new owner in July 2023 while Star Hercules and Star Cepheus were delivered to their new owner in August 2023.

In addition, in September 2023, we agreed to sell the vessel Star Zeta, which was delivered to her new owner in October 2023. Also in October and November 2023, we agreed to sell the vessels Star Athena, Star Glory, Star Theta and Star Jennifer, which are expected to be delivered to their new owners in November and December 2023. The total gross proceeds from the sale of the above five vessels will be $72.5 million with a corresponding gain of $15.6 million expected to be recognized in the fourth quarter of 2023.

Furthermore, as the Company looks towards fleet renewal, in October 2023, we entered into two firm and two optional (exercisable until December 13, 2023) shipbuilding contracts with Qingdao Shipyard Co., Ltd. for the construction of four 82,000 dwt Kamsarmax newbuilding vessels. The expected delivery dates for the two firm shipbuilding contracts are November 2025 and June 2026 respectively, whereas delivery dates for the two optional shipbuilding contracts are December 2025 and August 2026 respectively. The newbuild vessels meet the latest requirements of Energy Efficiency Design Index (EEDI Phase 3) in relation to carbon intensity (CO2) and comply with the latest NOX regulations, NOX TIER III. In addition, these vessels are fitted with the latest available and most fuel-efficient main engine produced by MAN B&W delivering from 2024 along with a shaft generator and Alternate Marine Power optionality, all  of which help to ensure best-in-class daily fuel consumptions and emissions reduction. The Company has also the option to equip the vessels with Exhaust Gas Cleaning Systems (“EGCS” or “scrubbers”) before delivery.

The following tables summarize key information about our fully delivered fleet as of November 13, 2023, and adjusted for the completion of the aforementioned sales:

Liquidity and Capital Resources

Our principal sources of funds have been cash flow from operations, equity offerings, borrowings under secured credit facilities, debt securities or bareboat lease financings and proceeds from vessel sales. Our principal uses of funds have been capital expenditures to establish and grow our fleet, maintain the quality of our dry bulk carriers, comply with international shipping standards, environmental laws and regulations, fund working capital requirements, make principal and interest payments on outstanding indebtedness and make dividend payments when approved by the Board of Directors.

Our short-term liquidity requirements include paying operating costs, funding working capital requirements and the short-term equity portion of the cost of vessel acquisitions and vessel upgrades, interest and principal payments on outstanding indebtedness and maintaining cash reserves to strengthen our position against adverse fluctuations in operating cash flows. Our primary source of short-term liquidity is cash generated from operating activities, available cash balances and portions from new debt and refinancings as well as equity financings.

Our medium- and long-term liquidity requirements are funding the equity portion of our newbuilding vessel installments and secondhand vessel acquisitions, if any, funding required payments under our vessel financing and other financing agreements and paying cash dividends when declared. Sources of funding for our medium- and long-term liquidity requirements include cash flows from operations, new debt and refinancings or bareboat lease financings, sale and lease back arrangements, equity issuances and vessel sales. Please also refer to Note 12 to our unaudited interim condensed consolidated financial statements, included elsewhere herein, for further discussion on our commitments as of September 30, 2023.

On September 22, 2023 and on October 30, 2023 we agreed to repurchase 10 million of our common shares at a price of $18.50 per common share (the “First Oaktree Share Repurchase”) and 10 million of our common shares at a price of $19.50 per common share (the “Second Oaktree Share Repurchase”), respectively from affiliates of Oaktree Capital Management, L.P. (“Oaktree”). The First Oaktree Share Repurchase was completed in early October with the repurchased shares being withdrawn and cancelled. Closing of the Second Oaktree Share Repurchase is expected to occur on December 1, 2023 after which the 10 million repurchased shares are expected be withdrawn and cancelled.

As of November 10, 2023, we had total cash of 268 million and outstanding borrowings (including bareboat lease financing) of 1,264 million, as adjusted for the proceeds from vessel sales and repayment of loans/leases, as further described in Notes 8 and 15 to our unaudited interim condensed consolidated financial statements as of September 30, 2023, included herein. In addition, following a number of interest rates swaps that we have entered into, we have converted a total of $331.3 million of such debt from floating to an average fixed rate of 42 bps with average maturity of 1.0 year.

Our debt agreements contain financial covenants and undertakings requiring us to maintain various ratios. A summary of these terms is included in Note 8 of the Company’s consolidated financial statements for the year ended December 31, 2022, included in the 2022 Annual Report.

We believe that our current cash balance and our operating cash flows to be generated over the short-term period will be sufficient to meet our liquidity needs for the foreseeable future (and at least through the end of the fourth quarter of 2024), including funding the operations of our fleet, capital expenditure requirements and any other present financial requirements, including the cost of our newbuilding program as well as the cost for the installation of ballast water treatment systems (“BWTS”) and Energy Saving Devices (“ESD”). In addition, we may sell and issue shares under our two effective At-the-Market offering programs of up to $150.0 million at any time and from time to time. As of November 13, 2023, cumulative gross proceeds under our At-the-Market offering programs were $33.6 million. We may seek additional indebtedness to finance future vessel acquisitions and our newbuilding program in order to maintain our cash position or to refinance our existing debt on more favorable terms. In addition we have entered into a committed term sheet with ING Bank N.V., London Branch (“ING”) for a senior secured bridge loan facility of $125.0 million and we are in final stage of negotiations with National Bank of Greece S.A for a loan facility of up to $156.4 million, under which $70.0 million additional liquidity will be provided and will be used along with the loan amount from ING to fund the total consideration for the Second Oaktree Share Repurchase, as described above. Our practice has been to fund the cash portion of the acquisition and construction cost of dry bulk carriers using a combination of funds from operations and bank debt or lease financing secured by mortgages or title of ownership on our dry bulk carriers held by the relevant lenders, respectively. We may also use the proceeds from potential equity or debt offerings to finance future vessel acquisitions. Our business is capital-intensive and its future success will depend on our ability to maintain a high-quality fleet through the acquisition and construction of newer dry bulk carriers and the selective sale of older dry bulk carriers. These acquisitions and newbuilding contracts will be principally subject to management’s expectation of future market conditions as well as our ability to acquire dry bulk carriers on favorable terms. However our ability to obtain bank or lease financing, to refinance our existing debt or to access the capital markets for offerings in the future, may be limited by our financial condition at the time of any such financing or offering, including the market value of our fleet, as well as by adverse market conditions resulting from, among other things, general economic conditions, including prevailing interest rates, weakness in the financial and equity markets and contingencies and uncertainties that are beyond our control. Our liquidity is also impacted by our dividend policy, as discussed below.

While the 2019 Novel Coronavirus (“COVID-19”) pandemic resulted in a significant reduction in global economic activity and extreme volatility in the global financial market, many nations worldwide have significantly eased or eliminated protective measures that were enacted at the outset of the outbreak, or during a resurgence, of COVID-19. For example, in December 2022 the Chinese authorities ended the strict zero COVID-19 policy. Following the economic reopening, the country’s seaborne dry bulk imports have experienced a significant increase throughout the first three quarters of the year that provided support to the market. On the other hand, the relaxation of COVID-19 related inefficiencies resulted in the increase of effective ship supply at a time when western economies are going through a monetary tightening cycle in order to fight inflation, thereby affecting commodities demand. Concurrently, we are observing an accumulation of supportive measures from Chinese authorities that are mostly concentrated on the property sector (e.g. the generous decrease of down-payment ratios for mortgages in key provinces, the decrease of interest rates and the increase of banks liquidity) in order to support the country’s overall economy, a condition that we expect to keep dry bulk imports demand at high levels, while imports from the rest of the world, especially from India and the Middle East, are experiencing a rebound. However, there continues to be uncertainty relating to whether and how COVID-19 will further evolve. The emergence of new variants and actions taken by governments or governmental agencies in an attempt to mitigate the spread of COVID-19 in the future could have a material adverse effect on our business, results of operations, cash flows, financial condition, the carrying value of our assets, the fair values of our vessels, and our ability to pay dividends.

Dividend Policy

Our dividend policy is described in Item 8. Financial Information-A. Consolidated statements and other financial information—Dividend Policy of our 2022 Annual Report.

On November 13, 2023, pursuant to our dividend policy, our Board of Directors declared a quarterly cash dividend of $0.22 per share, payable on or about December 18, 2023 to all shareholders of record as of December 5, 2023. The ex-dividend date is expected to be December 4, 2023.

Since Star Bulk is a holding company with no material assets other than the shares of its subsidiaries through which it conducts its operations, Star Bulk’s ability to pay dividends in the future will depend on its subsidiaries’ ability to distribute funds to it. Any future dividends declared will be at the discretion and remain subject to approval of our Board of Directors each quarter after its review of our financial condition and other factors, including but not limited to our earnings, the prevailing charter market conditions, capital requirements, limitations under our debt agreements and applicable provisions of Marshall Islands law, which generally prohibits the payment of dividends other than from operating surplus or while a company is insolvent or would be rendered insolvent upon the payment of such dividend. Star Bulk’s dividend policy and declaration and payment of dividends may be changed at any time and are subject to legally available funds and our Board of Directors’ determination that each declaration and payment is at the time in the best interests of Star Bulk and its shareholders after its review of our financial performance. There can be no assurance that our Board of Directors will declare or pay any dividend in the future.

Other Recent Developments

Please refer to Note 15 to our unaudited interim condensed consolidated financial statements, included elsewhere herein, for developments that took place after September 30, 2023.

Operating Results

Factors Affecting Our Results of Operations

We deploy our vessels on a mix of short to medium time charters or voyage charters, contracts of affreightment or in dry bulk carrier pools, according to our assessment of market conditions. We adjust the mix of these charters to take advantage of the relatively stable cash flow and high utilization rates associated with medium to long-term time charters, or to profit from attractive spot charter rates during periods of strong charter market conditions, or to maintain employment flexibility that the spot market offers during periods of weak charter market conditions. The following table reflects certain operating data of our fleet, including our ownership days and TCE rates, which we believe are important measures for analyzing trends in our results of operations, for the periods indicated:

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The following table reflects the calculation of our TCE rates as discussed in footnote (7) above. The table presents reconciliation of TCE Revenues to voyage revenues as reflected in the unaudited interim condensed consolidated income statements.

Voyage Revenues

Voyage revenues are driven primarily by the number of vessels in our operating fleet, the duration of our charters, the number of charter-in days, the amount of daily charter hire or freight rates that our vessels earn under time and voyage charters, respectively, which, in turn, are affected by a number of factors, including our decisions relating to vessel acquisitions and disposals, the number of vessels chartered-in, the amount of time that we spend positioning our vessels, the amount of time that our vessels spend in dry dock undergoing repairs, maintenance and upgrade work, the age, condition and specifications of our vessels, levels of supply and demand in the seaborne transportation market.

Vessels operating on time charters for a certain period of time provide more predictable cash flows over that period of time, but can yield lower profit margins than vessels operating in the spot charter market during periods characterized by favorable market conditions. Vessels operating in the spot charter market generate revenues that are less predictable, but may enable us to capture increased profit margins during periods of improvements in charter rates, although we would be exposed to the risk of declining vessel rates, which may have a materially adverse impact on our financial performance. If we employ vessels on period time charters, future spot market rates may be higher or lower than the rates at which we have employed our vessels on period time charters.

Voyage Expenses

Charter-in Hire Expenses

Charter-in hire expenses represent hire expenses for chartering-in third and related party vessels, either under time charters or voyage charters.

Vessel Operating Expenses

Vessel operating expenses include crew wages and related costs, the cost of insurance and vessel registry, expenses relating to repairs and maintenance, the cost of spares and consumable stores, tonnage taxes, regulatory fees, vessel scrubbers and BWTS maintenance expenses, lubricants and other miscellaneous expenses. Other factors beyond our control, some of which may affect the shipping industry in general, including for instance, developments relating to market prices for crew wages, lubricants and insurance, may also cause these expenses to increase.

Dry Docking Expenses

Dry docking expenses relate to regularly scheduled intermediate survey or special survey dry docking necessary to preserve the quality of our vessels as well as to comply with international shipping standards and environmental laws and regulations. Dry docking expenses can vary according to the age of the vessel and its condition, the location where the dry docking takes place, shipyard availability and the number of days the vessel is under dry dock. We utilize the direct expense method, under which we expense all dry docking costs as incurred.

Depreciation

We incur general and administrative expenses, including our onshore personnel related expenses, directors’ and executives’ compensation, share based compensation, legal, consulting, audit and accounting expenses.

Management Fees

Management fees include fees paid to third parties as well as related parties providing certain procurement services to our fleet.

(Gain) / Loss on Forward Freight Agreements and Bunker Swaps, net

When deemed appropriate from a risk management perspective, we take positions in freight derivatives, including freight forward agreements (the “FFAs”) and freight options, with an objective to utilize those instruments as economic hedges to reduce the risk on specific vessels trading in the spot market and to take advantage of short term fluctuations in the market prices. Upon the settlement, if the contracted charter rate is less than the average of the rates, as reported by an identified index, for the specified route and time period, the seller of the FFA is required to pay the buyer the settlement sum. The settlement amount is an amount equal to the difference between the contracted rate and the settlement rate, multiplied by the number of days in the specified period covered by the FFA. Conversely, if the contracted rate is greater than the settlement rate, the buyer is required to pay the seller the settlement sum. Our FFAs are settled mainly through reputable exchanges such as European Energy Exchange (“EEX”) or Singapore Exchange (“SGX”) so as to limit our exposure in over-the-counter transactions. Customary requirements for trading in FFAs include the maintenance of initial and variation margins based on expected volatility, open position and mark to market of the contracts. The fair value of the FFAs or freight options is treated as asset or liability until they are settled with the change in fair value being reflected in earnings. Any such settlements by us or settlements to us under FFAs or freight options, if any, are recorded under (Gain)/ Loss on forward freight agreements and bunker swaps, net.

Also, when deemed appropriate from a risk management perspective, we enter into bunker swap contracts to manage our exposure to fluctuations of bunker prices associated with the consumption of bunkers by our vessels. Bunker swaps are agreements between two parties to exchange cash flows at a fixed price on bunkers, where volume, time period and price are agreed in advance. Our bunker swaps are settled mainly through reputable exchanges such as Intercontinental Exchange (“ICE”) so as to limit our counterparty exposure in over-the-counter transactions. Bunker price differentials paid or received under the swap agreements as well as changes in their fair value are recognized under (Gain)/Loss on forward freight agreements and bunker swaps, net.

The fair value of freight derivatives and bunker swaps is determined through Level 1 inputs of the fair value hierarchy (quoted prices from the applicable exchanges such as EEX, SGX or ICE). Our FFAs and bunker swaps do not qualify for hedge accounting and therefore unrealized gains or losses are recognized under (Gain)/Loss on forward freight agreements and bunker swaps, net.

Other operational gain/(loss) includes gain/loss from all other operating activities which are not related to the principal activities of the Company, such as gain/loss from insurance claims.

Loss on Write-Down of Inventory

Loss on write-down of inventory results from the valuation of the bunkers remaining onboard our vessels following the decrease of bunkers’ net realizable value compared to their historical cost as of each period end.

Interest and Finance Costs

We incur interest expense and financing costs in connection with our outstanding indebtedness under our existing loan facilities (including sale and leaseback financing transactions). We also incur financing costs in connection with establishing those facilities, which are presented as a direct deduction from the carrying amount of the relevant debt liability and amortize them to interest and financing costs over the term of the underlying obligation using the effective interest method.

Interest Income

We earn interest income on our cash deposits with our lenders and other financial institutions.

Gain / (Loss) on Interest Rate Swaps, net

We enter into interest rate swap transactions to manage interest costs and risk associated with changing interest rates with respect to our variable interest loans and credit facilities. Interest rate swaps are recorded in the balance sheet as either assets or liabilities, measured at their fair value (Level 2), with changes in such fair value recognized in earnings under Gain/(Loss) on interest rate swaps, net, unless specific hedge accounting criteria are met. When interest rate swaps are designated and qualify as cash flow hedges, the effective portion of the unrealized gains/losses from those swaps is recorded in Other Comprehensive Income / (Loss) while any ineffective portion is recorded as Gain/(loss) on interest rate swaps, net.

Results of Operations

Voyage revenues net of Voyage expenses: Voyage revenues for the nine months ended September 30, 2023 decreased to $685.8 million from $1,142.4 million in the corresponding period in 2022. Time charter equivalent revenues (“TCE Revenues”) (as defined above) were $494.2 million compared to $909.1 million for the corresponding period in 2022. As a result, the TCE rate for the nine months ended September 30, 2023 was $15,035 compared to $27,418 for the corresponding period in 2022, which is indicative of the weaker market conditions prevailing during the recent period. Please refer to the table above for the calculation of the TCE Revenues and TCE and their reconciliation with Voyage Revenues, which is the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.

Charter-in hire expenses: Charter-in hire expenses for the nine months ended September 30, 2023 and 2022 were $13.9 million and $17.8 million, respectively. This decrease is mainly attributable to the decrease in charter-in days to 633 in the nine months ended September 30, 2023 from 717 in the corresponding period in 2022 as well as lower charter-in rates prevailing in the market following the weaker market conditions discussed above.

Vessel operating expenses: For the nine months ended September 30, 2023 and 2022, vessel operating expenses were $167.2 million and $176.0 million, respectively. The decrease is mainly due to the decrease in the average number of vessels in our fleet to 125.1 in the nine months ended September 30, 2023 from 128.0 for the respective period of 2022. Vessel operating expenses for the nine months ended September 30, 2023 included additional crew expenses related to the increased number and cost of crew changes performed during the period as a result of COVID-19 related restrictions, estimated to be $2.1 million and $2.1 million of pre-delivery expenses, due to change of management of certain vessels from third party to in-house. For the nine months ended September 30, 2022, the additional COVID-19 related costs were estimated to be $7.5 million and the pre-delivery expenses were $3.2 million.

Dry docking expenses: Dry docking expenses for the nine months ended September 30, 2023 and 2022 were $30.5 million and $29.0 million, respectively. During the nine months ended September 30, 2023, 24 vessels completed their periodic dry-docking surveys while during the corresponding period in 2022, 23 vessels completed their periodic dry docking surveys.

Depreciation: Depreciation expense decreased to $104.5 million for the nine-month period ended September 30, 2023 compared to $117.0 million for the corresponding period in 2022. The decrease is primarily driven by the change in the estimated scrap rate per light weight ton from $300 to $400 effective January 1, 2023, which resulted in lower depreciation expense by $11.9 million, together with the decrease in the average number of vessels in our fleet, discussed above.

Impairment loss: During the nine months ended September 30, 2023, an impairment loss of $7.7 million was incurred, resulting from the agreement to sell the vessels Star Borealis and Star Polaris described above as part of our fleet update under “Our Fleet”.

Other operational gain: Other operational gain for the nine months ended September 30, 2023 of $33.8 million includes: a) gain from insurance proceeds relating to Star Pavlina’s total loss discussed in our fleet update above of $28.2 million, b) daily detention compensation for Star Pavlina pursuant to its war risk insurance policy of $2.7 million in aggregate and c) other gains from insurance claims relating to other vessels of $2.9 million in aggregate. Other operational gain for the nine months ended September 30, 2022 of $6.9 million included a) daily detention compensation for three vessels blocked in Ukraine pursuant to their war risk insurance policy of $4.0 million and b) other gains from insurance claims relating to other vessels of $2.9 million.

Management fees: Management fees decreased to $12.7 million for the nine-month period ended September 30, 2023 compared to $14.7 million for the corresponding period in 2022 due to the change of management of certain vessels, from third party to in-house.

General and administrative expenses: General and administrative expenses for the nine-month periods ended September 30, 2023 and 2022 were $36.3 million and $44.3 million, respectively. The decrease is mainly attributable to the decrease in stock based compensation expense to $12.7 million for the nine-month period ended September 30, 2023 compared to $23.4 million for the corresponding period in 2022 partly counterbalanced by the effect of the increase in the Euro/USD exchange rate.

(Gain)/Loss on forward freight agreements and bunker swaps, net: For the nine-month period ended September 30, 2023, we incurred a net gain on FFAs and bunker swaps of $6.4 million, consisting of an unrealized loss of $2.1 million and a realized gain of $8.5 million. For the nine-month period ended September 30, 2022, we incurred a net loss on FFAs and bunker swaps of $3.6 million, consisting of an unrealized loss of $0.3 million and a realized loss of $3.3 million.

Gain on sale of vessels: Our results for the nine-month period ended September 30, 2023 include an aggregate net gain of $18.8 million which resulted from the completion of the sale of vessels discussed above.

Loss on write-down of inventory: Our results for the nine months ended September 30, 2023 include a loss on write-down of inventories of $5.6 million compared to a loss of $14.9 million included in our results during the corresponding period in 2022, in connection with the valuation of the bunkers remaining on board our vessels, as a result of the bunkers’ lower net realizable value compared to their historical cost.

Interest and finance costs: Interest and finance costs for the nine-month periods ended September 30, 2023 and 2022 were $49.8 million and $37.8 million, respectively. The driving factor for this increase is the significant increase in variable interest rates, which was partially offset by the positive effect from our interest rate swaps and the decrease in our weighted average outstanding indebtedness as well as the recent refinancing arrangements of older facilities with more favorable terms.

Interest income and other income/(loss): Interest income and other income/(loss) for the nine-month period ended September 30, 2023 amounted to $10.3 million, compared to interest income and other income/(loss), of $0.2 million in the nine-month period ended September 30, 2022. The increase of interest income is mainly due to both higher interest rates earned and higher cash balances maintained during the nine-month period ended September 30, 2023 as well as due to lower foreign exchange losses incurred in the nine-month period ended September 30, 2023, compared to the corresponding period in 2022.

Loss on debt extinguishment:  Loss on debt extinguishment for the nine-month periods ended September 30, 2023 and 2022 was $5.2 million and $1.1 million, respectively and was primarily affected by increased write-offs of unamortized debt issuance costs and other expenses incurred in connection with the loan and lease prepayments in 2023 compared to the corresponding period in 2022.

Cash Flows

Net cash provided by operating activities for the nine months ended September 30, 2023 and 2022 was $247.2 million and $653.6 million, respectively. This decrease was primarily driven by the lower charter rates due to the weaker market conditions continuing to prevail during the recent period compared to the corresponding period in 2022, and the increase in our interest payments for the reasons outlined above under “Interest and finance costs”.

Net cash provided by investing activities for the nine months ended September 30, 2023 was $186.0 million and consisted of $198.1 million in aggregate, of insurance proceeds received in connection with Star Pavlina’s constructive total loss and vessel sale proceeds received, partially offset by payments of $12.7 million, made for vessel modifications and upgrades and the acquisition of other fixed assets. Net cash used in investing activities for the nine months ended September 30, 2022 was $16.9 million and consisted mainly of $19.3 million paid in connection with the acquisition of other fixed assets and vessel upgrades counterbalanced by $2.4 million of hull and machinery insurance proceeds.

Net cash used in financing activities for the nine months ended September 30, 2023 and 2022 was $417.2 million and $717.2 million, respectively. The decrease was primarily driven by lower dividend payments of $139.6 million in 2023 compared to $545.1 million in the corresponding period in 2022 partly counterbalanced by higher net debt outflows of $260.2 million in the nine months ended September 30, 2023 compared to $166.4 million in the same period of 2022.

Significant Accounting Policies and Critical Accounting Estimates

For a description of our critical accounting estimates and all of our significant accounting policies, see Note 2 to our audited financial statements and “Item 5 - Operating and Financial Review and Prospects,” included in our 2022 Annual Report. There have been no material changes from the “Critical Accounting Estimates” previously disclosed in our 2022 Annual Report, except as discussed above under “Depreciation”.