EuroDry (EDRY) 21 May 242024 Q1 Earnings call transcript

Thank you for standing by, ladies and gentlemen, and welcome to the EuroDry Limited Conference Call on the First Quarter 2024 Financial Results.

We have Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company.

[Operator Instructions] I must advise you that this conference is being recorded today. the has its been that press with reminded that release publicly be company results announced a Please distributed.

in on conference in Before Pittas, result passing statements draw was statements may statement, read securities and involve presentation are that that the through expectations meaning statements. be forward-looking Slide not laws. of I Mr. release. that will kindly uncertainties based and and same presentation, today's also it. forward-looking risks I realized. such the federal would like go press the within the which making the Please to current remind These your #X whole floor forward-looking statement expectations being in call, and the EuroDry full to to take Matters management of statement attention included may to which a be the the everyone webcast are has discussed moment

Please to like I'd now And Pittas. to sir. the floor Mr. go pass ahead,

Good is morning, scheduled with gentlemen, Together for all Chief call. conference for you me us thank today Aslidis, Officer. joining our our Financial ladies Tasos and and

The purpose financial ended for to our XX, to of is period turn the X-month Slide call XXXX. Please of presentation. discuss March X the results today's

Our shown financial here. highlights are

to release a million net shares. Adjusted EBITDA adjusted For was loss shareholders adjusted Please Adjusted $X.X period million or million the or share. loss income loss controlling diluted net the and for EBITDA. quarter first $X.XX to diluted total and for for quarter $X.XX shareholders to $XX.X of net press the of and $X.X of was XXXX, basic the of turn attributable revenues per we reported controlling reconciliation $X.X the net basic loss attributable per and million.

in later more Our Aslidis in highlights presentation. our will go on the detail CFO, financial Tasos over

million under repurchased a for of was The in our $XX plan stock announced August to XXXX. XXX,XXX $X.X of of renewed program market total the of for open another we repurchase XX, XXXX, about in total up As our of May million a August year. had shares common in share XXXX

X our sales drydocking overview Please and turn highlights. an purchase and to Slide chartering of for

On most index, employed vessels whilst are until on an the [ March index-linked based Yekaterini charters, to vessel motor in time side, continues employed short-term the ] index of average under XXX.X% the the routes. charter XXXX our Kamsarmax Baltic chartering be the Kamsarmax charter of at

the various can accompanying You fixed presentation. charters in of see specifics the the we

firm securing continue earnings to charter plan spot rates a time will we the charter of trading We our portion consider but or further, for vessels if FFAs. being, time via

repairs, motor and vessels: vessels quarter, Starlight dry-dockings and April. underwent Molyvos its X Motor in dock, we dry Regarding undergoing Luck. had vessel dock Luck Blessed the dry during

the to auxiliary days for the machinery addition, due operationally Luck XX boiler. In will was underwriters off-hire cost damage but Blessed full, the of the The time covered the [indiscernible] unfortunately, in lost by time, repairs quarter. during primary of the idle be the cost of we with the Blessed are during the time dry the and Luck of is factors together idle incurred not. resulting the The the this repairs, docks X for loss

Supramax Please X including carriers, X vessels, bulk consists X EuroDry turn X. dry and Kamsarmax Ultramax of to Slide Panamax fleet a vessels, bulk XX dry carrier.

an about years. average carriers age XX cargo of of capacity XX.X bulk tons X total Our deadweight million dry a have and

otherwise M/V Christos K NRP our call, referred Project to the in XX% and by owns like point, previously I'd remind entities remaining by that that as own The as motor of the is you, NRP represented last vessels investors. this EuroDry Maria. owned announced XX% At earnings Finance, to owners

Slide further employment. on to turn update for a fleet now Please X our

XX%. coverage see, around XXXX stands rate can at for remainder fixed of you the As

charter commodity quarter first we strong X, Slide X Spot rising day. unusually XXXX the spot first to around XXXX set and an prices XXXX. $XX,XXX March seems $XX,XXX rates the experienced exports than ended $XX,XXX continued May Panamaxes XX, In spot suggest may hovered the per during highlights that, rate Sea around positive spot the Canal for the late year XXXX, by rate Red per quarter the By momentum have by increased until to to approximately Including to supported the X-year quarter, and and first and were first their about Turning last Panamaxes quarter, XXXX the relative market day. from the sector key XX, for go up the parallel, $XX,XXX $XX,XXX XX, to recently. May of rates day for seasonal per typical for average time Panama versus over year. disruptions, overall, trends. rates more In market counter a

This in Please turn in will same latest modest in into in improvement outlook rate XXXX. United a growth economy largely this XXXX. global the developing grow due X. continue economic X.X% economies. now XXXX slowdown projects to The is as XXXX, continue more sizable the IMF's is Slide a And and update April at pace the the by expected to in offset for emerging to States, to

projected do spending the consumer market. forecast the amid as In to one a related January the seem The despite more XXXX working. higher strong imposed upgraded along oil and by from the to XXXX growth spending X.X% continued Russia's investments tight imposed mechanism X.X% higher the Clearly, with strong cut Western government by to countries, changes, labor in well forecast price West to not be also exports previously. IMF sanctions biggest production, global by oil prices, growth increased the was IMF to XXXX X.X% due as of Russia's X.X% from in

than at sooner lowest emerging target lower advanced to steadily The economies. in next X in the in from decades Global at to inflation years XXXX is X.X% markets economies XXXX globally their X.X%. X.X% its for X.X% and forecast in XXXX, declining to and is developing and projected is returning inflation with

interest rate will cuts anticipate central persistent the X Federal of remains economy now price stability. end global reduced The to inflation. this due the to repair be X banks for despite that anticipate now most Both XXXX projected banks surprisingly hikes resilient to -- Reserve significant bank the rate

we shipping, Chinese economy, property is economy which enduring to For in by monitor and only forecast the continue by its XXXX. is in grow to sector. X.X% affected downturn The in China's closely X.X% XXXX

However, growth even economic trade China's in already to tensions take stability restored. may geopolitical intensify environment to may further and be due weakened longer an

hand, demand though, and in strong X.X% in rising other projected is domestic the strong at robustness to and India the reflecting On XXXX, population. working with XXXX remain X.X% growth in age

according to the in next shipping significant years, of continue quite grow ASEAN-X, to Finally, support. will IMF, strongly couple the the providing

According fleet grow disruptions. to expected a trade Clarkson's, This XXXX, duration in demand longer Panama below these for higher. the Sea potentially is of bulk drive uplift to and regions X.X% full for about Red XXXX Canal includes disruptions will slightly growth. X.X% in due A year the dry presently to by demand

on In slower addition, could stronger the congestions for demand effect increased speeds lend in a support due and to dry further average XXXX. demand combined bulk

X.X%, end Sea eased the by Demand Red this Clarkson's in the of XXXX is to grow assuming year. by disruption has by projected about

order new Slide Uncertainty about fuels building to book low the XX. continuing. to high the turn prices and of have led Please future

to a the growth suggests lowest over XXXX, years. X low the fleet historical As near total as fleet of X.X%, order of levels. next the X is book only This May percentage at

growth, increased effective have and the supply This fleet further. of due low bulk even steaming this environmental could regulations. the the slow expected the Complementing also to available we effect introduction scrapping new of reduce

XX. Slide to Turning

look into now the Let us in supply bit a more deeply. fundamentals

note X.X% was fleet The As to market be is, XXXX, slippage. Clarkson's X.X% old, the in the to of XXXX, vessel XXXX, good if older be latest percentage XXXX vessels. that scrapping, May fleet fleet aforementioned of the remains expected dry X.X% and operating are in levels candidate and new as therefore, due is XX,XXX of to years figures deliveries fleet at bulk course, X% report, growth total total current than onwards. or actual expected the a in for XX than to According lower. scrapping a especially and of Also lower

this Dry of a the Please decline Slide to our outlook bulk where following XX Despite modest summarize peak shipping geopolitical and in the highest December. since level season market with slow quarter this due the a discussed during for market. bulk disruptions dry turn first marks primarily of XXXX XXXX, the decrease, typically as we to for XXXX, weather-related previously. XXXX the QX showed exception of

around for XXXX the the outlook current levels. bulk market a of attributable which is market strength tonmiles. tensions in rates largely with recent conditions increased The significantly have Suez in robust The Canal, to carrier suggests remainder

to time although these when to fully anticipated may begin or a take are As normalize, amount patterns disruptions resolve, considerable of and demand this adjustment materialize. to ease

demand. assumes Clarkson's currently bulk adding Sea to rerouting Red dry X.X% is tonmile

to back X.X% due then half demand disruptions Assuming to rerouting a full growth. XXXX of to the these tonmile year which of will normal. adds year This ease

Assuming the that on or amount so could It this quickly figure geopolitical XXXX significant is a developments, time. uncertain largely demand of depend all subtract subsequent as disruption easing, growth. from is will mile and ton though similar could will it possible quite be take

as strong cumulative growth bulker in XXXX, recent the earnings trade be to of have offset expected In and event, rebound. diminished and any the fleet softer are years in the inefficiencies fleet fleet

and forward, is bulk trade the but scrapping, more market the predict. expected going negatively overall less to is hand, On speeds affect other to positively resulting coal decarbonization dry is transported. hard the slower by on process effect lines The in and if volumes

the fleet recovery about methanol rates though, the historically the book On as charter has the ordering significant to limited ships increase. said for nearly to levels, despite and available fuel due stage The a fuel of the demand setting shipyards supply side at ships. before, for been slots potential remains of of uncertainty order new orders should the future, low in very ratio lack

EU to will more related curtail regulation new could slower further emissions via a of ETS, measures of cope for and portion introduction fleet. with, the operational CII, to industry are or are all Furthermore, scrapping acronyms speed increased need come. EEXI, the FuelEU supply

shows Let's vessels of turn over the X-year Panamax last of to of dry charter the Slide time side XX. The slide XX evolution left rates years. the

As XX, per rate day. around which X-year of is charter XX% deadweight the for of at historical tons $XX,XXX XXXX, capacity day, per stood with $XX,XXX the time ships May XX,XXX of Panamax above median about a

vessel side in million, Panamax higher more seen XX-year-old At significantly $XX.X XX-year purchase we graph. to other be seen reached and million. current last the historical median in the $XX.X price This hand, of reluctant of maximum as the are around can have prices than $XX.XX XX prices, price price the the secondhand vessels. years, is million average On right-hand

the to present strengthening market waiting sheet, happy keep opportunities reducing new themselves. rates, on balance to debt, are We fleet and running at the for

to Aslidis, Tasos Let pass me CFO, the detail. more over in over financial now the floor various go our to highlights

Good and Thank well, from very as much, you morning Aristides. me ladies gentlemen.

Over of the you the the will to for financial quarter I those year. compare of next an and XXXX X overview results give period slides, same last of our highlights first

Slide For to that, let's XX. turn

revenues XX.X% the increase result For compared previous a of same the during the the of operated of during this quarter reported company $XX.X quarter of first year. $XX.X number we to first was earned revenues increased this our the quarter first vessels XXXX, increased the representing year. bank of the this year plus our total of vessels of charter quarter the million quarter of And of the net million, last net total rates

shareholders to net loss loss $X.XX same of loss represented shareholders net this NRP investors, controlling $X.XX million the $X.X and represents the The million, explained noncontrolling of to attributable attritable the a the the ownership of quarter company period million in to XXXX. to as for first reported the net the earlier. of entities a period compared of XX% The controlling net loss period Aristides the for that attributable year $X.XX shareholders the to of of as for corresponds by loss million

income, XXXX to financing first the compared the period and amount costs, $X.XX that benchmark interest income million and million, period same rates increased first XXXX compared as of mainly to of balances same lower the for due pay, carried [indiscernible] increased XXXX. of Interest last lower was we cash interest Interest due the $X.XX higher, period during during year. quarter including was as to other for of expense the to of to the debt to while quarter increased the

shares diluted quarter loss first of of million of number the about on was shares $X.XX million also compared to basic and and for year for diluted weighted the average attributable share diluted. of XXXX of to quarter first during on $X.XX EBITDA about this controlling quarter year the X.X for per to compared Basic X.X shareholders million Adjusted first share per and was the first million, shares diluted basic and basic $X.XX, quarter outstanding, XXXX. calculated last calculated of $X.XX loss

to from per March last effect of same been XX, derivatives, for the shareholders share, quarter ended $X.XX the adjusted the the Excluding the net unrealized quarter and earnings the gain the basic XXXX, to again basic the loss for $X.XX loss diluted, had compared period diluted which of of attributable on and controlling adjusted year. for

Let's now turn fleet Slide our XX review to performance. to

-- As by of and will year. the usual, review first first utilization the we rates quarter last for this start expected our the compared examining year for to

into rate commercial utilization broken fleet operational. is down Our and

this first and rate to the period XX.X% year rate first $XX,XXX quarter in while vessel During XXXX. was vessels average and the compared XXX%, were operational of time of owned equivalent On rate operational last average operated the earning compared during an per XX quarter to charter was per average, day. the year, $XX,XXX utilization day, of XX.X% commercial first an our per quarter -- earning for XX of XX.X%, commercial vessels same our of this utilization year,

operating vessel XXXX. vessel administrative quarter $X,XXX and management per expenses, this the first but costs, per to drydocking for were day compared the excluding day year, daily general during fees, of expenses $X,XXX first per of total quarter Our including per

and drydocking account on to repayments. move interest the the expenses we breakeven addition we see takes which levels, cash can If flow loan down expenses, above, forward table, this the into in

first of day, XXXX. of vessel XXXX, same level day our per per the daily flow cash vessel compared per the to was breakeven $XX,XXX For quarter per $XX,XXX for period

profile. Turning on debt to Slide XX our to review

bank year, The including XXXX, this of both was thus million, repayments, amount XXXX. reducing million to million, debt about cash loan March debt decrease $XX million to our about the of repayments Then total of for is by million. breakeven projected $XX.X to of $XX.X due to a volume XX, significantly XXXX, As level. and are outstanding about in the $XXX.XX and $X.X our end about decline year, for year payments, remainder total to XXXX our per it flow

we our on our slide debt, about this is about the a assuming mentioning worth make portion cost make is of pay It our the debt, rate of which total soft we're swapped, of our reduced the around of going overall if also we account take into debt X.XX%, that of interest at average margin X.XX%, and cost to for X.XX%. the that debt the have

I our $X,XXX be the per as At months to the see the around cash day XX per bottom projected of vessel months, EBITDA level into we we mentioned. XX to level our $XX,XXX cash flow this Overall, [indiscernible] components. level around next expect slide, be day per flow breakeven its our down per breakeven for vessel for breakeven and can broken next

can taking our and see balance of sheet snapshot Let where we a to financial way, -- XX, me basically highlights moving now assets our some a simplistic the conclude in my liabilities. to presentation brief Slide by from

and in of million. our As of million. XX, assets The total value our resulting $XXX.X $XXX XXXX, our million, was other stood book of balance approximately cash at sheet about March in vessels current book value of assets about $XX

in liabilities of XX.X% On our representing of earlier, to about book about X.X% holdings, of our the of share. was amounted common assets. book value while while the as mentioned of value our of $XXX.X remaining a value $X.X $XX.XX I assets, shareholders, of the about resulting the debt million, the March book attributed our of approximately interest investors, XXXX XX, million per $XXX.X of value to remaining value our liability of represents NRP million, our is $XXX.X side, book as minority The million $X.X million, book other

million. about thus more than reports, $XX. value, However, share their market our we based their is that share, around to $XX our which to value was on at and market per than That NAV transaction is higher market equivalent value $XXX and book vessels and is stands other about million per the above book $XX estimate of bringing

trading a discount XX%, to shareholders price, share order Our a discount the a and in gap represents lately, that significant investors. potential upside of is which compared NAV, offers our for our $XX significant valuation around

floor to let And me to call. with the that, turn back Aristides the continue

Thank you, Tasos.

the for open now me Let up floor may questions any have. we

Our Instructions] of [Operator first Maxim Tate Group. question from line the Sullivan comes with

pay First, loan refinance looking the existing on this that to you cash something you're the to on flow to or profile prioritize is cash -- the debt? debt Slide debt, using XX. before or of end will use the down flow year, you Tasos, repayment that repayment,

of we're think any payments believe the refinance to planning that are in the our the make can cash see think slide, you due the year are to flow debt breakeven. repayments to we cash reducing we year our year going remaining near I of as are the to planning -- in flow next I repay after, from and are the -- don't we in the significantly I drop the the generate. future. And

payments in loan XXXX, time. be are refinancing coming can have we will you due suspect see. as And at that those We I the

boiler repair, Can in please? then And did expenses while damage, in the in you that voyage? And and the is Blessed dry that, go to within the docking more that costs? quarter dock, into Luck happen detail on the dry on

not left covered. was It's after repairs But an covered. shipyard. the were the time This happened left it the Unfortunately, is are [indiscernible] we of just that the cost happened No. shipyard insurable it the cause crew this the the happened. of damage loss all [indiscernible] when and and had we

employment. So XX lost we days of

insurable? that [indiscernible] Can cost approximate sure to you that or be repair that should approximate

said... It's it's cheap I I repair. But $XXX,XXX. a about as not think

numbers insured. included because it's not is in the fully It

either find will drydocking or operating the it not expenses. So you

And that? dry Okay. forward, the rest docks going review the of you can then for scheduled year,

which has Starlight. In we And but... only QX, we haven't have drydock, X as far looked in already place, which I the QX, this quarter, as taken is have X drydocks

QX There's this no nothing for year. scheduled of -- drydocks

for Nothing QX.

is So really that it's to the drydocks QX still in X come.

Our Partners. line with Global comes next Alliance question the from Poe Fratt of

categorize I more a trying just potentially like year, outlook. modestly, you do less create get, a your do it's next to demand these you bit rate of and Or potentially things you and a little question, it's things, think? you environment, signal, of case? that conservative as little XXXX conservative a think about growth you your you're bit sort it's outlook a had think of base Aristides, less sort or If in slowing softer a supply disruption, congestion if would case linger, a little better bit than would some

Yes.

because mean, that we to all difficult But be geopolitical the I under in growth, situations they -- affect it how honesty, move extremely and can nobody to the say current think I would predict market conservative. they generally quite be. will really economic affect trade, the is try what

supply There is regulations a are fact The that due positive. strong growth a growing These positives. vessels environmental the a are The are positive. slower is to low few positives.

market If demand XXXX. difficult have said to market. quite that, FFA It's a we Having lower turns better predicting much XXXX, really also out in the market in is than being XXXX can slightly strong in decide. a

I but quite trade have have good we always market. longer the will this currently there case does our very are and -- a the we be But be. to can still is the well, tensions So the works global Very, well, economy decide but actual conservative. economy mean, if information move what is geopolitical routes base difficult i.e., very have. we It decipher can

might of to Do 'XX if that in 'XX? the with would of of mid- the And Yes. sure hedging half secondly, any could -- that year. of [indiscernible] sort Understood. I the sort high early that place? part then and be have given outlook latter of And attractive teens, your FFA about in be I'm you not XXXX the one something in the anything then for rest any or for context, the

either market. couple we essentially all we open fix through currently We through levels a levels these have of numbers, But normal spot satisfactory our our see months, see a even we position. -- any these trading still these we market in at If overall. time probably higher FFA charters ships strengthening FFAs. levels, if more the Yes. of the today's will portion next levels profitable Currently, levels, as are fleet don't than that said, on are charters are or

and Also, the quarter, we that have had we that mainly. loss Blessed done. to due are we loss we But off-hire FFAs on quarter, optimistic next had docks This of the took cautiously that we the a to we Luck the will return profitability. dry

you year Tasos, the quarter? should what some in Understood. of relative And first guidance for could give to up OpEx? just So sort OpEx just just of the for slightly you've then reported the be rest

Yes.

I pretty first budget much think for the on we're quarter.

to on believe. mean, hard It's we surprises hard haven't I I or far. X%, we plus would to So seen X% any be minus say. But the say. OpEx It's so to

] Our comes line Lars [ Arctic Securities. next Ide the question of from with

as guess this forward. upon I touched as question. exposure kind I your [indiscernible]. positioning you this for context, in I that the last market you be view your more report assume, should on of with But [indiscernible] guess fleet you're morning, positive, moving So your in market noted my [indiscernible]

Sure. months, positive. I be market few next our the the mean that base should quite case is for

of Thank Yes. Covered [indiscernible]. a you. lot

Thank turn final back you. I'll question-and-answer that floor gentlemen, Ladies our the comments. concludes any for session. and management to

today's in thank presentation. listening you all Well, for

QX to be X back you. in about will We Thank months' you with results time.

Bye, everybody.

This conference Thank concludes today's you. call.

at You for this may lines Thank time. your you disconnect participation. your