NASDAQ:SBLK Star Bulk Carriers Q1 2024 Earnings Report $18.84 -0.13 (-0.69%) Closing price 08/8/2025 04:00 PM EasternExtended Trading$19.03 +0.19 (+1.01%) As of 08/8/2025 07:33 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. ProfileEarnings HistoryForecast Star Bulk Carriers EPS ResultsActual EPS$0.87Consensus EPS $0.87Beat/MissMet ExpectationsOne Year Ago EPSN/AStar Bulk Carriers Revenue ResultsActual Revenue$259.39 millionExpected Revenue$260.78 millionBeat/MissMissed by -$1.39 millionYoY Revenue GrowthN/AStar Bulk Carriers Announcement DetailsQuarterQ1 2024Date5/22/2024TimeN/AConference Call DateThursday, May 23, 2024Conference Call Time11:00AM ETConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Star Bulk Carriers Q1 2024 Earnings Call TranscriptProvided by QuartrMay 23, 2024 ShareLink copied to clipboard.Key Takeaways For Q1 2024, Star Bulk reported net income of €75 million (adjusted EPS $0.87) and adjusted EBITDA of $123 million, declared a $0.75 dividend per share, and ended the quarter with $472 million of liquidity against €1.45 billion of debt, realizing an average TCE less OpEx and G&A of $13,442 per vessel per day. The Eagle Bulk merger closed on April 9, granting Eagle shareholders 2.6211 Star Bulk shares each, yielding $104.3 million in cash, and is expected to deliver over $5.7 million in annual cost savings from lower interest, insurance and in-house CRE. Since 2021, the company has returned over $1.2 billion in dividends and $400 million in share buybacks and has executed opportunistic vessel sales (€150 million in Q1), cumulatively deploying €2.1 billion to create shareholder value while continuing to deleverage. Star Bulk’s fleet now totals 161 vessels (average age 11.3 years), with 100% ballast water compliance, energy-saving retrofits completed on 4 ships (19 more planned) and €42.4 million of drydock CapEx scheduled for 51 vessels in 2024. The company improved its Asset Analytics ESG Risk Smart Score to 19 (low risk), maintains the top ranking among US-listed peers, launched emission reduction initiatives, welcomed its first female cadets onboard and rolled out a new anonymous ethics reporting platform. AI Generated. May Contain Errors.Conference Call Audio Live Call not available Earnings Conference CallStar Bulk Carriers Q1 202400:00 / 00:00Speed:1x1.25x1.5x2xThere are 7 speakers on the call. Operator00:00:00Thank you for standing by, ladies and gentlemen, and welcome to the Starbuck Carriers' Conference Call on the Q1 2024 Financial Results. We have with us Mr. Petros Pappas, Chief Executive Officer Mr. Hamish Norton, President Mr. Simos Schew and Mr. Operator00:00:16Christos Boularis, Co Chief Financial Officers Mr. Nikolas Rescos, Chief Operating Officer and Mrs. Harris Teckon Tanafi, Chief Strategy Officer of the company. At this time, all participants are in a listen only mode. There will be a presentation followed by a question and answer session. Operator00:00:41I must advise you that this conference is being recorded today. We now pass the floor to one of your speakers today, Mr. Christos Vergarais. Please go ahead, sir. Speaker 100:00:51Thank you, operator. I am Christos Degleris, co CFO of Star Bulk Tires, and I would like to welcome you to our conference call regarding our financial results for the Q1 of 2024. Before we begin, I kindly ask you to take a moment to read the Safe Harbor statement on Slide number 2 of our presentation. In today's presentation, we'll go through our Q1 results, cash evolution during the quarter, actions taken to create value for our shareholders, an update on the Eagle Bulk integration, vessel operations, fleet update, the latest on the ESG front and our views on industry fundamentals before opening up for questions. Let us now turn to Slide number 3 of the presentation for a summary of our Q1 2024 highlights. Speaker 100:01:50For the Q1, the company reported the following: net income amounted to €75,000,000 with adjusted net income of $73,000,000 or $0.87 adjusted earnings per share. Adjusted EBITDA was $123,000,000 for the quarter. For the Q1, as per our existing dividend policy, we declared a dividend per share of $0.75 payable on or about June 6, 2023. Since 2021, dividend distributions and share buybacks are over 1,200,000,000 dollars and $400,000,000 respectively. Our total liquidity today stands strong at €472,000,000 Meanwhile, our total debt stands at €1,450,000,000 euros On the top right of the page, you will see our daily figures per vessel for the quarter. Speaker 100:02:53Our PCE rate was $19,627 per vessel per day. Our combined daily OpEx and net cash G and A expenses per vessel per day amounted to 6,185. Therefore, our TCE less OpEx and cash G and A is around $13,442 per vessel per day. Following Eagle shareholders approval on April 9, the Eagle Bulk transaction was completed and each Eagle Bulk shareholder received 2.6211 Starbucks shares per share of Eagle. Eagle Box convertible notes will be exchangeable at the conversion rate equal to 83.67 shares of Star Bulk OVAL stock when it matures on August 1, 2024. Speaker 100:03:48Cash received following the Eagle merger amounted to $104,300,000 Currently, we have 161 vessels on a fully delivered basis, including the 5 U Building Camshamax vessels we have announced. During 2024, we have sold 8 vessels for total gross proceeds of €150,000,000 4 of these vessels, namely Star Audrey, Star Pixis, Stellar Eagle and Crown Eagle are expected to be delivered during Q2 to their new owners. Slide 4 graphically illustrates the change in the company's cash balance during the Q1. We started the quarter with €262,000,000 in cash and generated positive cash flow from operating activities of €114,000,000 Including debt proceeds and repayments, CapEx payments for energy saving devices and ballast water treatment system installments and the Q4 dividend payment, we arrived at a cash balance of €269,000,000 at the end of the quarter. Slide 5 provides an overview of the company's capital allocation policy over the last 3 years and the various levers we have used to create shareholder value. Speaker 100:05:16On the top left, we show our net debt evolution. 43%, Speaker 200:05:32€2,000,000,000 We Speaker 100:05:35have taken advantage of historically elevated S and P values to sell some of our older and less efficient vessels using the equity proceeds to buy back our shares at attractive values. Since 2022, we have brought back $423,000,000 worth of Starbucks stock. 20,000,000 shares valued at $380,000,000 were bought in the Q4 of 2023 for Oaktree. Given that our shares at the time were trading at a significant discount to net asset value and reduced prices from vessel sales at net asset value, we are taking advantage of the arbitrage to create shareholder value. Combining all of the above, see that we have focused on returning capital to shareholders, while at the same time deleveraging the balance sheet and buying back shares when there are opportunities to do so accretively. Speaker 100:06:35In total, since 2021, we have taken actions of EUR 2,100,000,000 to create value for our shareholders. I will now pass the floor to our COO, Nikos Rescos, for an update on the Ecobalt transaction integration and our operational performance. Thank you, Christophe. Slide 6 illustrates a summary of the Eagle Bulk transaction integration. The merger with Eagle Bulk will allow us to leverage our strong global presence of the combined entity with offices in Singapore, the U. Speaker 100:07:10S, Greece, Denmark and Cyprus. The respective Singapore offices are to merge into 1 and continue as a commercial and take care management hub covering the Asia Pacific. The Stamford office is to continue both on Commercial and Technical Management, covering the Atlantic and the U. S. Markets. Speaker 100:07:31Together with the Athens headquarters in Europe, we will maintain presence in Copenhagen for chartering operations covering the Atlantic, Continental and the Med area. We are creating a new integrated commercial team, managing the 2nd largest Ultramax, Supramax fleet globally to combine capabilities and aim for improved time charter performance. We also aim to rebalance employment strategy and include voyage business. We have already refinanced the ex Eagle debt facility, resulting in interest cost savings of $3,200,000 per year. We have executed new insurance agreements for the ex Eagle vessels, saving $1,900,000 per annum in insurance premium costs. Speaker 100:08:16CRE will be gradually taken in house with an expected cost reduction of about $600 per vessel per day during the next 18 months. Significant synergies are expected from the centralization of procurement of all stores, spare parts and lubricants. Drydocks of ex Eagle Bulk vessels will benefit from stable competitive pricing agreements with service providers and shipyards globally. Marine Safety Quality and Technical Maintenance Standards, Processes, Policies and Systems are to be applied across the combined fleet, aiming to align with the Star Bulk Rideshiv Safety Score and Port State Control performance. Lastly, systems integrations are underway to enable efficiencies amongst offices and departments and create further synergies. Speaker 100:09:09Turning to Slide 7, we provide an operational update. OIBDA expenses was at $4,960 for Q1 2024. Net cash G and A expenses were at $12.23 per vessel per day for the same period. In addition, we continue to rate at the top amongst our listed peers in terms of Rideship Safety Score. Slide 8 provides a fleet update and some guidance around our future drydock and the relevant total off hire days. Speaker 100:09:44On the top right of the page, we provide a CapEx schedule illustrating our newbuilding CapEx and vessel energy efficiency upgrades with 100% of our fleet by now being ballast water system fitted. Our expected drydock expense for the remainder of 20 24 is estimated at €42,400,000 for the drydocking of 51 vessels, including 12 ex Eagle Bulk vessels. In total, we expect to have approximately 12.50 off hire days for the same period. Based on our latest construction schedule, our newbuilding vessels are expected to be delivered during Q4 of 2025, Q2 and Q3 of 2026. In line with the EXI and CII regulations, we continue investing and upgrading our fleet with the latest operational technologies available, aimed in improving our fuel consumption and reducing our environmental footprint and further enhancing commercial attractiveness of the Star Bulk fleet. Speaker 100:10:45Regarding our energy saving devices, programs during the quarter, we have completed and tested retrofits on 4 vessels with 19 more vessels planned for retrofit by the end of 2024. The above numbers are based on current estimates around drydock, reservoir planning, vessel employment and yard capacity. Turning to Slide 9 for an update on our fleet sales. On the vessel sales front, we continue disposing our vessels opportunistically at historically attractive levels, having agreed during Q1 to sell 7 vessels for a total gross proceeds of 134,000,000 dollars reducing our average fleet age and improving overall fleet efficiency. During the Q2, we have fairly agreed to sell 1 more vessel, the Crown Eagle. Speaker 100:11:35We took delivery of 3 out of the 6 long term charter illegal vessels that will be delivered to us throughout 2024, and specifically 2 Tunisian Rusan Kamsarmaxes and a Tunisian Sedro Ultramax. The existing chartering contracts have been rolled over to Star Bulk following the merger. We have 5 firm shipbuilding contracts in KINDOW shipyard for the construction of 32,000 Bedwidth KAMSTRAX newbuilding vessels. Considering the aforementioned changes in our fleet mix, we operate 1 of the largest platform fleet amongst U. S. Speaker 100:12:09And European listed peers with 161 vessels on a fully delivered basis at an average age of 11.3 years. I will now pass the floor to our Chief Strategy Officer, Harris Plakadolaki, for an ESG update. Speaker 300:12:24Thank you, Nico. Please turn to Slide 10, where we highlight our continued leadership on the ESG front. The Starbucks Asset Analytics, ESG Risk Smart Scores has further improved from 21.3 medium risk to 19 low risk, maintaining Star Bulk's number 1 ranking among U. S. Listed peers and positioning the company as one of the best performing companies globally in the category transportation shipping. Speaker 300:12:57During Q1 2024, we began, along with our partners, the scoping of work and initial projects with a maritime emissions reduction center to develop and adopt new and existing solutions for reducing greenhouse gas emissions from the global region. The center was granted the Motivation Award at the ESG Shipping Awards International 2024. On the regulatory front, NTC81 has progressed discussions related to IMO's midterm market based measures, which are set to come into force in 2027. We are continuously assessing the impact of upcoming environmental regulations and considering action plan options for our clients. As part of Sabal's program to enhance diversity and inclusion, our first female cadets have embarked on board 1 of our new customer vessels. Speaker 300:13:56We continue the development of StarLink along with the installation of firewalls onboard our vessels and have embarked on a project to equip our vessels with the cyber route technologies to digitalize and advance the monitoring of onboard systems performance and security. On the governance front and as part of our enhanced Code of Business Conduct and Ethics, we have launched a new online visit drawing platform on the company's website to encourage open reporting by employees, crews and third parties, safeguard confidentiality and anonymity and improve the handling and monitoring process of any received loan reports. I will now pass the floor to our CEO, Pedro Pappas, for a market update and his closing remarks. Speaker 400:14:47Thank you, Harris. Please turn to Slide 11 for a brief update of supply. During the 1st 4 months of 2024, a total of 12,100,000 deadweight was delivered and 1,600,000 deadweight was sent to demolition for a net fleet growth of 10,500,000 deadweight or 2.9% year on year. Uncertainty on future green propulsion, high shipbuilding costs and limited CPR capacity until late 2026 have helped keep new orders under relative control. The order book presently stands at the low level of 9.3% of the fleet. Speaker 400:15:35Furthermore, vessels above 20 15 years of age stand at 8.8% and 21.2% of the fleet, while scrap prices stabilized at elevated levels and to make demolition of overage and energy inefficient tonnage an attractive option during seasonal downturns over the next years. The average steaming speed of the drybulk fleet decreased to a new record low level in January due to downward pressures from inflated bunker costs and new environmental regulations. Having said that, over the last 2 months, speeds have rebounded to 11.2 knots following the higher freight rate environment and stabilization of oil prices. We expect emissions regulations, including EXI and CII, to increasingly incentivize slow steaming, retrofits and to help moderate supply over the next several years. Global port congestion followed the strong downward trend over the last 2 years that gradually inflated available supply approximately 5%. Speaker 400:16:56During the Q1 of 2024, congestion appears to have fully normalized on all sizes, and going forward, we expect it to follow seasonal trends. Moreover, Panama Canal constraints since mid-twenty 23 and rising tension in the Red Sea continue to cause strong inefficiencies for trade with a positive effect on the supply and demand balance of 2024. As a result of the above trends, nominal fleet growth is unlikely to exceed 2.5% per annum over the next couple of years. Let us now turn to Slide 12 for a brief update of demand. According to Clarksons, total drybulk trade during 2024 is projected to expand by 1.6% in tons and 2.4% in ton miles. Speaker 400:17:47During the Q1 of 2024, total dry bulk volumes increased by approximately 5.5% year on year, supported by iron ore, coal and record miner bulk exports, while non mines increased at a faster pace due to favorable conditions in Brazil and Canal inefficiencies. The IMF is projecting global GDP growth 3.2% for 2024 2025, the same pace as in 2023, with China projected to slow down to 4.6% and 4.1%, respectively. Nevertheless, Chinese GDP increased by 5.3% in Q1, faster than initially expected, while drybulk imports were up by 8.2% compared to last year. The country's full economic recovery from COVID-nineteen has yet to unfold due to the struggling property market, but has received support by strength in infrastructure, manufacturing and exports. The airbag demand from the rest of the world is experiencing a strong recovery over the last quarters that is expected to continue as it receives support from lower commodity prices and expectations of easing monetary policy. Speaker 400:19:08During the Q1, imports were up by 2.9% year on year, with the increase coming mainly from India and Far East countries, while imports from Western economies are also moving higher following 2 years of contraction. Iron ore trade is projected to remain flat in tons and to expand by 1% in ton miles during 2024. China's steel production declined by 3.1% year on year during the Q1. Weak domestic consumption is forcing steelmakers to export excess output, and some Western economies are raising tariffs as a response. At the same time, domestic iron ore production and imports increased by 15.7% and 7%, respectively, and have helped full stockpiles higher. Speaker 400:20:01On the other hand, steel production from the rest of the world has been on a strong upward trend since September and increased by 7.2% during the Q1. Coal trade is projected to contract by 0.3% in tons and by 2.5% in ton miles during 2024. Global focus on energy security has inflated gold rate, while Atlantic exporters have redistributed regional quantities eased with positive effect for ton miles. Chinese imports surged 61% during 2023 and remained strong during the Q1 of 2024, supported by 4.1% year on year decline in domestic coal production and a 7.4% year on year increase in thermal electricity generation. Furthermore, India is emerging as a leading buyer of coal during the last quarters as consumption has outpaced domestic production and has led to a strong increase in imports. Speaker 400:21:10Grades trade is projected to expand by 2.1% tons and by 5.2% ton miles during 20 24. Exports from Latin America increased by 14% during the Q1, following strong Brazilian soybean exports and a recovery of Argentinian volumes. Moreover, Ukraine increased exports to the highest level since the start of the war, while lower grain prices, improving crop forecast and increased focus on food security is projected to support grain trade in the medium term. Mine or above trade is projected to expand by 3.7% in tons and by 4.7% in ton miles during 2024. Minor but trade has the highest correlation to global GDP growth, and the recent strength in the container market provides a positive indicator for short term prospects of smaller sites. Speaker 400:22:09The positive price arbitrage continues to incentivize Chinese steel exports and backhaul trades, while bauxite exports out of West Africa continue to expand at a high price pace and generate strong ton miles for Capesize vessels. As a final comment, the long term prospects of the drybulk market remain positive due to favorable supply dynamics, increased inefficiencies in trade and a recovery of demand supported by large global infrastructure investment needs for the world's green transition. Star Bulk expects to take advantage of the recent strength in the drybulk market, having mostly maintained its diverse scrubber fitted fleet in the spot market and thus continue to create value for its shareholders. Without taking any more of your time, I will now pass the floor over to the operator to answer any questions you may have. Speaker 200:23:10Thank you. Operator00:23:34Our first question comes from the line of Omar Anokta with Jefferies. Please proceed with your question. Thank you. Speaker 200:23:42Hi, guys. Good afternoon. Just a couple of questions from me and you've been asked this before. I recall, you were asked shortly after the Eagle announcement. Just in general, how you view the Star Bulk fleet from here. Speaker 200:23:56Petros, you just talked about the diversified just towards the end of your comments, you mentioned the diversified fleet. You've been more dynamic recently obviously to demerger you've sold some ships. Post merger now you're a bit bottom heavy on the supraultra side obviously giving you more exposure to the minor bulk trade. I guess in general as we think of you being more dynamic with the fleet, Are Capes a place Capesize vessels, is that a place you'd like to see a higher ratio of Star's fleet going forward? Or do you prefer to build or increase the sub cape ratio of the fleet? Speaker 200:24:32Sorry for the long winded question. Speaker 400:24:36Thank you, Omar. Well, it happens that this is a SupramaxUltramax fleet. Next merger may be a Cape fleet, who knows. For the time being, you're right. We are smaller vessel heavy, but that also gives us an opportunity in the sense that during high markets like this is, one can shell all their vessels of the fleet and that way keep the average age at a better level. Speaker 400:25:12So I think that going forward, you may see us sell some of our less efficient and older vessels and that may kind of rectify the count until we make our next move. Speaker 200:25:31Makes sense. Thanks, Patrice. And maybe just a follow-up. The in terms of just the debt load at the moment with the company, you have $1,400,000,000 of debt and you've got $470,000,000 or so of cash. How are you thinking about that amount of debt in general? Speaker 200:25:48Are you comfortable keeping at that level? You have on slide 5 of the 43% reductions in net debt since 2021. Do you feel the need to keep that trend going and lowering that figure? Are you okay with the current balance? Speaker 500:26:07For the moment, Omar, we're continuing to delever at basically the same absolute rate as we've been delevering for a while. We're paying down $250,000,000 $250,000,000 of debt a year. And for the foreseeable future, we're going to keep doing that. Obviously, at some point, we get to net debt 0, and we'll figure out something to do then. But we want to set the company up to be able to get into the era of decarbonization. Speaker 500:26:49And we think you need a strong company with a strong balance sheet to do that well. Speaker 200:26:58Yes. No, agreed. And then I guess just on that, potentially getting to net debt 0, is that in any way shift or change the dividend policy approach or the minimum cash requirements you're looking to keep? Speaker 500:27:13We have no current plans to change any of our capital allocation Speaker 400:27:20policies. Speaker 500:27:23If the world changes, the policy may change, but for the moment, the policy is our policy. Operator00:27:32Okay. Very good. Thanks, Hamish. And thanks, Nigel. I'll turn it over. Speaker 400:27:37Thank you, Omar. Operator00:27:41Thank you. Our next question comes from the line of Ben Nolan with Stifel. Please proceed with your question. Speaker 200:27:49Yes, thanks. Actually, first, Hamish, could Speaker 600:27:53you maybe dive into that comment that you made there about wanting to have a strong balance sheet to move into decarbonizing world or I forgot exactly how you framed it. What is that does that mean at some point you're going to need to replace the assets for things that have much lower carbon emissions? Or maybe just unpack that comment if you could. Speaker 500:28:17I mean, I guess the answer is we don't actually know what's going to happen. And if you don't know what's going to happen, that sounds like a really good reason to have a strong balance sheet. The more you know what's going to happen, the more you can lever up in anticipation of what's going to happen. But yes, I mean, we think that probably there will be expensive ships burning expensive fuel, getting really high charter rates. And we think it Speaker 100:28:50will be very good for Speaker 500:28:51the business and very good for us because we think it will favor large companies that can afford R and D and compliance and all the overheads that go with having a difficult regulatory environment. But whatever it is, it's going to favor big companies with lots of resources and a strong balance sheet. Speaker 100:29:18And if I may add to Aimee's point, this is Christoph's side then, we think it's prudent that during a healthy market, we reduce debt as much as possible so that in the future, effectively, we have more capacity to take on more debt when the prices are lower and when we want to further leverage on the upside. Sure. Speaker 600:29:43Yes. And I absolutely agree with that. Sticking with sort of the decarbonization theme a little bit, I know that you guys have investigated or invested in some cases in certain early stage R and D type Speaker 200:30:02technologies. Curious if Speaker 600:30:04you have any updated thoughts on what that might look like, whether it's carbon capture, in particular, fuel types that you think are emerging as the best candidates? Any new color in that respect? Speaker 100:30:20Hi, Ben. This is Nikolas. For the time being, we're investing on technologies that have been tested. So basically improving as much as we can the existing fleet. You have noted that we are continuing installing energy efficiency devices that are proven to decrease our consumption and improve the commercial appeal of each vessel. Speaker 100:30:43We are agnostic of all technologies going in the market. We're testing how clean robots. We're testing paints. They both have an effect on performance. We have tested carbon capture on both of our vessels. Speaker 100:30:58But it's a matter of putting all ends to meet in order to make things a viable commercial solution. We do believe that it is an intermediate solution until we have a few that will be widely acceptable both in terms of supply consumption and of course on the engines. But for the time being, we're trying to improve the existing vessels as much as we can. But Hydro Capsule, yes, we do have hope that this may materialize later into the year. Speaker 600:31:28Okay. That's helpful. And then lastly for me, it seems like and I appreciate the color that you guys gave on the integration of Eagle. And it seems like so far so good with respect to finding synergies, which I know is difficult in this industry. But the costs are down. Speaker 600:31:47The share price is up. And at least by my math, it's above NAV. So that part of the thesis has played out thus far. I'm curious if that is opening the doors for other opportunities. And Petrus, I know you talked about the next merger, what have you. Speaker 600:32:06Are you finding potential sellers out there that can look at that transaction and say, this is a good liquidity of that for me and a way to maximize value for my assets and at the same time you guys can utilize your shares as a currency? Speaker 500:32:26Well, look, everything like this helps, right? Closing one deal and doing a good job of it is clearly going to help our reputation in the market for other deals. But I don't underestimate how hard these deals are Speaker 100:32:45to get Speaker 500:32:45done. We have gotten a lot of them done, but it's they're always hard to close and they're always low probability. That being said, we're looking at possible transactions. And we may be able to do 1 or more. We certainly intend to try to keep growing. Speaker 600:33:13Okay. That's all. And I guess, are you, I don't know, maybe more optimistic about that than maybe you would have been a few months ago? Speaker 500:33:25I think we are more optimistic. But I hope our optimism is actually able to influence the way the world works. We're doing our best. All right. Speaker 400:33:42Ben, I think that we are more optimistic than usual also because of the environmental regulations. I think they will have an impact a positive impact on the supply. And I think this is going to happen to take place for several years going forward. So that's a good basis for our optimism, I believe. Speaker 500:34:14Yes. I mean, what the environmental regulations do in large part is make it no funds to operate a small shipping company. For a long time, for centuries, it's been great fun to operate a small shipping company. I think that's changing. And the business is becoming less fun and more sort of demanding of a large corporate organization. Speaker 600:34:43Yes. Well, it's always fun to have fun. SoRead morePowered by Earnings DocumentsSlide DeckPress Release(8-K) Star Bulk Carriers Earnings HeadlinesStar Bulk outlines $104M in vessel sale proceeds and targets $33M dry dock spend amid cost synergiesAugust 8 at 8:36 PM | msn.comStar Bulk Carriers Corp (SBLK) Q2 2025 Earnings Call Highlights: Navigating Profitability Amid ...August 8 at 8:36 PM | finance.yahoo.com$100 Trillion “AI Metal” Found in American Ghost TownJeff Brown recently traveled to a ghost town in the middle of an American desert… To investigate what could be the biggest technology story of this decade. In short, he believes what he's holding in his hand is the key to the $100 trillion AI boom… And only one company here in the U.S. can mine this obscure metal.August 9 at 2:00 AM | Brownstone Research (Ad)Star Bulk Carriers Corp. 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As of December 31, 2023, the company owned a fleet of 116 dry bulk vessels with combined carrying capacity of 13.1 million deadweight tonnage (dwt) consisting of Newcastlemax, Capesize, Post Panamax, Kamsarmax, Panamax, Ultramax, and Supramax vessels with carrying capacities between 53,489 dwt and 209,537 dwt. Star Bulk Carriers Corp. was incorporated in 2006 and is based in Marousi, Greece.View Star Bulk Carriers ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Airbnb Beats Earnings, But the Growth Story Is Losing AltitudeDutch Bros Just Flipped the Script With a Massive Earnings BeatIs Eli Lilly’s 14% Post-Earnings Slide a Buy-the-Dip Opportunity?Constellation Energy’s Earnings Beat Signals a New EraRealty Income Rallies Post-Earnings Miss—Here’s What Drove ItDon't Mix the Signal for Noise in Super Micro Computer's EarningsWhy Monolithic Power's Earnings and Guidance Ignited a Rally Upcoming Earnings SEA (8/12/2025)Cisco Systems (8/13/2025)Alibaba Group (8/13/2025)NetEase (8/14/2025)Applied Materials (8/14/2025)Petroleo Brasileiro S.A.- Petrobras (8/14/2025)NU (8/14/2025)Deere & Company (8/14/2025)Palo Alto Networks (8/18/2025)Medtronic (8/19/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 7 speakers on the call. Operator00:00:00Thank you for standing by, ladies and gentlemen, and welcome to the Starbuck Carriers' Conference Call on the Q1 2024 Financial Results. We have with us Mr. Petros Pappas, Chief Executive Officer Mr. Hamish Norton, President Mr. Simos Schew and Mr. Operator00:00:16Christos Boularis, Co Chief Financial Officers Mr. Nikolas Rescos, Chief Operating Officer and Mrs. Harris Teckon Tanafi, Chief Strategy Officer of the company. At this time, all participants are in a listen only mode. There will be a presentation followed by a question and answer session. Operator00:00:41I must advise you that this conference is being recorded today. We now pass the floor to one of your speakers today, Mr. Christos Vergarais. Please go ahead, sir. Speaker 100:00:51Thank you, operator. I am Christos Degleris, co CFO of Star Bulk Tires, and I would like to welcome you to our conference call regarding our financial results for the Q1 of 2024. Before we begin, I kindly ask you to take a moment to read the Safe Harbor statement on Slide number 2 of our presentation. In today's presentation, we'll go through our Q1 results, cash evolution during the quarter, actions taken to create value for our shareholders, an update on the Eagle Bulk integration, vessel operations, fleet update, the latest on the ESG front and our views on industry fundamentals before opening up for questions. Let us now turn to Slide number 3 of the presentation for a summary of our Q1 2024 highlights. Speaker 100:01:50For the Q1, the company reported the following: net income amounted to €75,000,000 with adjusted net income of $73,000,000 or $0.87 adjusted earnings per share. Adjusted EBITDA was $123,000,000 for the quarter. For the Q1, as per our existing dividend policy, we declared a dividend per share of $0.75 payable on or about June 6, 2023. Since 2021, dividend distributions and share buybacks are over 1,200,000,000 dollars and $400,000,000 respectively. Our total liquidity today stands strong at €472,000,000 Meanwhile, our total debt stands at €1,450,000,000 euros On the top right of the page, you will see our daily figures per vessel for the quarter. Speaker 100:02:53Our PCE rate was $19,627 per vessel per day. Our combined daily OpEx and net cash G and A expenses per vessel per day amounted to 6,185. Therefore, our TCE less OpEx and cash G and A is around $13,442 per vessel per day. Following Eagle shareholders approval on April 9, the Eagle Bulk transaction was completed and each Eagle Bulk shareholder received 2.6211 Starbucks shares per share of Eagle. Eagle Box convertible notes will be exchangeable at the conversion rate equal to 83.67 shares of Star Bulk OVAL stock when it matures on August 1, 2024. Speaker 100:03:48Cash received following the Eagle merger amounted to $104,300,000 Currently, we have 161 vessels on a fully delivered basis, including the 5 U Building Camshamax vessels we have announced. During 2024, we have sold 8 vessels for total gross proceeds of €150,000,000 4 of these vessels, namely Star Audrey, Star Pixis, Stellar Eagle and Crown Eagle are expected to be delivered during Q2 to their new owners. Slide 4 graphically illustrates the change in the company's cash balance during the Q1. We started the quarter with €262,000,000 in cash and generated positive cash flow from operating activities of €114,000,000 Including debt proceeds and repayments, CapEx payments for energy saving devices and ballast water treatment system installments and the Q4 dividend payment, we arrived at a cash balance of €269,000,000 at the end of the quarter. Slide 5 provides an overview of the company's capital allocation policy over the last 3 years and the various levers we have used to create shareholder value. Speaker 100:05:16On the top left, we show our net debt evolution. 43%, Speaker 200:05:32€2,000,000,000 We Speaker 100:05:35have taken advantage of historically elevated S and P values to sell some of our older and less efficient vessels using the equity proceeds to buy back our shares at attractive values. Since 2022, we have brought back $423,000,000 worth of Starbucks stock. 20,000,000 shares valued at $380,000,000 were bought in the Q4 of 2023 for Oaktree. Given that our shares at the time were trading at a significant discount to net asset value and reduced prices from vessel sales at net asset value, we are taking advantage of the arbitrage to create shareholder value. Combining all of the above, see that we have focused on returning capital to shareholders, while at the same time deleveraging the balance sheet and buying back shares when there are opportunities to do so accretively. Speaker 100:06:35In total, since 2021, we have taken actions of EUR 2,100,000,000 to create value for our shareholders. I will now pass the floor to our COO, Nikos Rescos, for an update on the Ecobalt transaction integration and our operational performance. Thank you, Christophe. Slide 6 illustrates a summary of the Eagle Bulk transaction integration. The merger with Eagle Bulk will allow us to leverage our strong global presence of the combined entity with offices in Singapore, the U. Speaker 100:07:10S, Greece, Denmark and Cyprus. The respective Singapore offices are to merge into 1 and continue as a commercial and take care management hub covering the Asia Pacific. The Stamford office is to continue both on Commercial and Technical Management, covering the Atlantic and the U. S. Markets. Speaker 100:07:31Together with the Athens headquarters in Europe, we will maintain presence in Copenhagen for chartering operations covering the Atlantic, Continental and the Med area. We are creating a new integrated commercial team, managing the 2nd largest Ultramax, Supramax fleet globally to combine capabilities and aim for improved time charter performance. We also aim to rebalance employment strategy and include voyage business. We have already refinanced the ex Eagle debt facility, resulting in interest cost savings of $3,200,000 per year. We have executed new insurance agreements for the ex Eagle vessels, saving $1,900,000 per annum in insurance premium costs. Speaker 100:08:16CRE will be gradually taken in house with an expected cost reduction of about $600 per vessel per day during the next 18 months. Significant synergies are expected from the centralization of procurement of all stores, spare parts and lubricants. Drydocks of ex Eagle Bulk vessels will benefit from stable competitive pricing agreements with service providers and shipyards globally. Marine Safety Quality and Technical Maintenance Standards, Processes, Policies and Systems are to be applied across the combined fleet, aiming to align with the Star Bulk Rideshiv Safety Score and Port State Control performance. Lastly, systems integrations are underway to enable efficiencies amongst offices and departments and create further synergies. Speaker 100:09:09Turning to Slide 7, we provide an operational update. OIBDA expenses was at $4,960 for Q1 2024. Net cash G and A expenses were at $12.23 per vessel per day for the same period. In addition, we continue to rate at the top amongst our listed peers in terms of Rideship Safety Score. Slide 8 provides a fleet update and some guidance around our future drydock and the relevant total off hire days. Speaker 100:09:44On the top right of the page, we provide a CapEx schedule illustrating our newbuilding CapEx and vessel energy efficiency upgrades with 100% of our fleet by now being ballast water system fitted. Our expected drydock expense for the remainder of 20 24 is estimated at €42,400,000 for the drydocking of 51 vessels, including 12 ex Eagle Bulk vessels. In total, we expect to have approximately 12.50 off hire days for the same period. Based on our latest construction schedule, our newbuilding vessels are expected to be delivered during Q4 of 2025, Q2 and Q3 of 2026. In line with the EXI and CII regulations, we continue investing and upgrading our fleet with the latest operational technologies available, aimed in improving our fuel consumption and reducing our environmental footprint and further enhancing commercial attractiveness of the Star Bulk fleet. Speaker 100:10:45Regarding our energy saving devices, programs during the quarter, we have completed and tested retrofits on 4 vessels with 19 more vessels planned for retrofit by the end of 2024. The above numbers are based on current estimates around drydock, reservoir planning, vessel employment and yard capacity. Turning to Slide 9 for an update on our fleet sales. On the vessel sales front, we continue disposing our vessels opportunistically at historically attractive levels, having agreed during Q1 to sell 7 vessels for a total gross proceeds of 134,000,000 dollars reducing our average fleet age and improving overall fleet efficiency. During the Q2, we have fairly agreed to sell 1 more vessel, the Crown Eagle. Speaker 100:11:35We took delivery of 3 out of the 6 long term charter illegal vessels that will be delivered to us throughout 2024, and specifically 2 Tunisian Rusan Kamsarmaxes and a Tunisian Sedro Ultramax. The existing chartering contracts have been rolled over to Star Bulk following the merger. We have 5 firm shipbuilding contracts in KINDOW shipyard for the construction of 32,000 Bedwidth KAMSTRAX newbuilding vessels. Considering the aforementioned changes in our fleet mix, we operate 1 of the largest platform fleet amongst U. S. Speaker 100:12:09And European listed peers with 161 vessels on a fully delivered basis at an average age of 11.3 years. I will now pass the floor to our Chief Strategy Officer, Harris Plakadolaki, for an ESG update. Speaker 300:12:24Thank you, Nico. Please turn to Slide 10, where we highlight our continued leadership on the ESG front. The Starbucks Asset Analytics, ESG Risk Smart Scores has further improved from 21.3 medium risk to 19 low risk, maintaining Star Bulk's number 1 ranking among U. S. Listed peers and positioning the company as one of the best performing companies globally in the category transportation shipping. Speaker 300:12:57During Q1 2024, we began, along with our partners, the scoping of work and initial projects with a maritime emissions reduction center to develop and adopt new and existing solutions for reducing greenhouse gas emissions from the global region. The center was granted the Motivation Award at the ESG Shipping Awards International 2024. On the regulatory front, NTC81 has progressed discussions related to IMO's midterm market based measures, which are set to come into force in 2027. We are continuously assessing the impact of upcoming environmental regulations and considering action plan options for our clients. As part of Sabal's program to enhance diversity and inclusion, our first female cadets have embarked on board 1 of our new customer vessels. Speaker 300:13:56We continue the development of StarLink along with the installation of firewalls onboard our vessels and have embarked on a project to equip our vessels with the cyber route technologies to digitalize and advance the monitoring of onboard systems performance and security. On the governance front and as part of our enhanced Code of Business Conduct and Ethics, we have launched a new online visit drawing platform on the company's website to encourage open reporting by employees, crews and third parties, safeguard confidentiality and anonymity and improve the handling and monitoring process of any received loan reports. I will now pass the floor to our CEO, Pedro Pappas, for a market update and his closing remarks. Speaker 400:14:47Thank you, Harris. Please turn to Slide 11 for a brief update of supply. During the 1st 4 months of 2024, a total of 12,100,000 deadweight was delivered and 1,600,000 deadweight was sent to demolition for a net fleet growth of 10,500,000 deadweight or 2.9% year on year. Uncertainty on future green propulsion, high shipbuilding costs and limited CPR capacity until late 2026 have helped keep new orders under relative control. The order book presently stands at the low level of 9.3% of the fleet. Speaker 400:15:35Furthermore, vessels above 20 15 years of age stand at 8.8% and 21.2% of the fleet, while scrap prices stabilized at elevated levels and to make demolition of overage and energy inefficient tonnage an attractive option during seasonal downturns over the next years. The average steaming speed of the drybulk fleet decreased to a new record low level in January due to downward pressures from inflated bunker costs and new environmental regulations. Having said that, over the last 2 months, speeds have rebounded to 11.2 knots following the higher freight rate environment and stabilization of oil prices. We expect emissions regulations, including EXI and CII, to increasingly incentivize slow steaming, retrofits and to help moderate supply over the next several years. Global port congestion followed the strong downward trend over the last 2 years that gradually inflated available supply approximately 5%. Speaker 400:16:56During the Q1 of 2024, congestion appears to have fully normalized on all sizes, and going forward, we expect it to follow seasonal trends. Moreover, Panama Canal constraints since mid-twenty 23 and rising tension in the Red Sea continue to cause strong inefficiencies for trade with a positive effect on the supply and demand balance of 2024. As a result of the above trends, nominal fleet growth is unlikely to exceed 2.5% per annum over the next couple of years. Let us now turn to Slide 12 for a brief update of demand. According to Clarksons, total drybulk trade during 2024 is projected to expand by 1.6% in tons and 2.4% in ton miles. Speaker 400:17:47During the Q1 of 2024, total dry bulk volumes increased by approximately 5.5% year on year, supported by iron ore, coal and record miner bulk exports, while non mines increased at a faster pace due to favorable conditions in Brazil and Canal inefficiencies. The IMF is projecting global GDP growth 3.2% for 2024 2025, the same pace as in 2023, with China projected to slow down to 4.6% and 4.1%, respectively. Nevertheless, Chinese GDP increased by 5.3% in Q1, faster than initially expected, while drybulk imports were up by 8.2% compared to last year. The country's full economic recovery from COVID-nineteen has yet to unfold due to the struggling property market, but has received support by strength in infrastructure, manufacturing and exports. The airbag demand from the rest of the world is experiencing a strong recovery over the last quarters that is expected to continue as it receives support from lower commodity prices and expectations of easing monetary policy. Speaker 400:19:08During the Q1, imports were up by 2.9% year on year, with the increase coming mainly from India and Far East countries, while imports from Western economies are also moving higher following 2 years of contraction. Iron ore trade is projected to remain flat in tons and to expand by 1% in ton miles during 2024. China's steel production declined by 3.1% year on year during the Q1. Weak domestic consumption is forcing steelmakers to export excess output, and some Western economies are raising tariffs as a response. At the same time, domestic iron ore production and imports increased by 15.7% and 7%, respectively, and have helped full stockpiles higher. Speaker 400:20:01On the other hand, steel production from the rest of the world has been on a strong upward trend since September and increased by 7.2% during the Q1. Coal trade is projected to contract by 0.3% in tons and by 2.5% in ton miles during 2024. Global focus on energy security has inflated gold rate, while Atlantic exporters have redistributed regional quantities eased with positive effect for ton miles. Chinese imports surged 61% during 2023 and remained strong during the Q1 of 2024, supported by 4.1% year on year decline in domestic coal production and a 7.4% year on year increase in thermal electricity generation. Furthermore, India is emerging as a leading buyer of coal during the last quarters as consumption has outpaced domestic production and has led to a strong increase in imports. Speaker 400:21:10Grades trade is projected to expand by 2.1% tons and by 5.2% ton miles during 20 24. Exports from Latin America increased by 14% during the Q1, following strong Brazilian soybean exports and a recovery of Argentinian volumes. Moreover, Ukraine increased exports to the highest level since the start of the war, while lower grain prices, improving crop forecast and increased focus on food security is projected to support grain trade in the medium term. Mine or above trade is projected to expand by 3.7% in tons and by 4.7% in ton miles during 2024. Minor but trade has the highest correlation to global GDP growth, and the recent strength in the container market provides a positive indicator for short term prospects of smaller sites. Speaker 400:22:09The positive price arbitrage continues to incentivize Chinese steel exports and backhaul trades, while bauxite exports out of West Africa continue to expand at a high price pace and generate strong ton miles for Capesize vessels. As a final comment, the long term prospects of the drybulk market remain positive due to favorable supply dynamics, increased inefficiencies in trade and a recovery of demand supported by large global infrastructure investment needs for the world's green transition. Star Bulk expects to take advantage of the recent strength in the drybulk market, having mostly maintained its diverse scrubber fitted fleet in the spot market and thus continue to create value for its shareholders. Without taking any more of your time, I will now pass the floor over to the operator to answer any questions you may have. Speaker 200:23:10Thank you. Operator00:23:34Our first question comes from the line of Omar Anokta with Jefferies. Please proceed with your question. Thank you. Speaker 200:23:42Hi, guys. Good afternoon. Just a couple of questions from me and you've been asked this before. I recall, you were asked shortly after the Eagle announcement. Just in general, how you view the Star Bulk fleet from here. Speaker 200:23:56Petros, you just talked about the diversified just towards the end of your comments, you mentioned the diversified fleet. You've been more dynamic recently obviously to demerger you've sold some ships. Post merger now you're a bit bottom heavy on the supraultra side obviously giving you more exposure to the minor bulk trade. I guess in general as we think of you being more dynamic with the fleet, Are Capes a place Capesize vessels, is that a place you'd like to see a higher ratio of Star's fleet going forward? Or do you prefer to build or increase the sub cape ratio of the fleet? Speaker 200:24:32Sorry for the long winded question. Speaker 400:24:36Thank you, Omar. Well, it happens that this is a SupramaxUltramax fleet. Next merger may be a Cape fleet, who knows. For the time being, you're right. We are smaller vessel heavy, but that also gives us an opportunity in the sense that during high markets like this is, one can shell all their vessels of the fleet and that way keep the average age at a better level. Speaker 400:25:12So I think that going forward, you may see us sell some of our less efficient and older vessels and that may kind of rectify the count until we make our next move. Speaker 200:25:31Makes sense. Thanks, Patrice. And maybe just a follow-up. The in terms of just the debt load at the moment with the company, you have $1,400,000,000 of debt and you've got $470,000,000 or so of cash. How are you thinking about that amount of debt in general? Speaker 200:25:48Are you comfortable keeping at that level? You have on slide 5 of the 43% reductions in net debt since 2021. Do you feel the need to keep that trend going and lowering that figure? Are you okay with the current balance? Speaker 500:26:07For the moment, Omar, we're continuing to delever at basically the same absolute rate as we've been delevering for a while. We're paying down $250,000,000 $250,000,000 of debt a year. And for the foreseeable future, we're going to keep doing that. Obviously, at some point, we get to net debt 0, and we'll figure out something to do then. But we want to set the company up to be able to get into the era of decarbonization. Speaker 500:26:49And we think you need a strong company with a strong balance sheet to do that well. Speaker 200:26:58Yes. No, agreed. And then I guess just on that, potentially getting to net debt 0, is that in any way shift or change the dividend policy approach or the minimum cash requirements you're looking to keep? Speaker 500:27:13We have no current plans to change any of our capital allocation Speaker 400:27:20policies. Speaker 500:27:23If the world changes, the policy may change, but for the moment, the policy is our policy. Operator00:27:32Okay. Very good. Thanks, Hamish. And thanks, Nigel. I'll turn it over. Speaker 400:27:37Thank you, Omar. Operator00:27:41Thank you. Our next question comes from the line of Ben Nolan with Stifel. Please proceed with your question. Speaker 200:27:49Yes, thanks. Actually, first, Hamish, could Speaker 600:27:53you maybe dive into that comment that you made there about wanting to have a strong balance sheet to move into decarbonizing world or I forgot exactly how you framed it. What is that does that mean at some point you're going to need to replace the assets for things that have much lower carbon emissions? Or maybe just unpack that comment if you could. Speaker 500:28:17I mean, I guess the answer is we don't actually know what's going to happen. And if you don't know what's going to happen, that sounds like a really good reason to have a strong balance sheet. The more you know what's going to happen, the more you can lever up in anticipation of what's going to happen. But yes, I mean, we think that probably there will be expensive ships burning expensive fuel, getting really high charter rates. And we think it Speaker 100:28:50will be very good for Speaker 500:28:51the business and very good for us because we think it will favor large companies that can afford R and D and compliance and all the overheads that go with having a difficult regulatory environment. But whatever it is, it's going to favor big companies with lots of resources and a strong balance sheet. Speaker 100:29:18And if I may add to Aimee's point, this is Christoph's side then, we think it's prudent that during a healthy market, we reduce debt as much as possible so that in the future, effectively, we have more capacity to take on more debt when the prices are lower and when we want to further leverage on the upside. Sure. Speaker 600:29:43Yes. And I absolutely agree with that. Sticking with sort of the decarbonization theme a little bit, I know that you guys have investigated or invested in some cases in certain early stage R and D type Speaker 200:30:02technologies. Curious if Speaker 600:30:04you have any updated thoughts on what that might look like, whether it's carbon capture, in particular, fuel types that you think are emerging as the best candidates? Any new color in that respect? Speaker 100:30:20Hi, Ben. This is Nikolas. For the time being, we're investing on technologies that have been tested. So basically improving as much as we can the existing fleet. You have noted that we are continuing installing energy efficiency devices that are proven to decrease our consumption and improve the commercial appeal of each vessel. Speaker 100:30:43We are agnostic of all technologies going in the market. We're testing how clean robots. We're testing paints. They both have an effect on performance. We have tested carbon capture on both of our vessels. Speaker 100:30:58But it's a matter of putting all ends to meet in order to make things a viable commercial solution. We do believe that it is an intermediate solution until we have a few that will be widely acceptable both in terms of supply consumption and of course on the engines. But for the time being, we're trying to improve the existing vessels as much as we can. But Hydro Capsule, yes, we do have hope that this may materialize later into the year. Speaker 600:31:28Okay. That's helpful. And then lastly for me, it seems like and I appreciate the color that you guys gave on the integration of Eagle. And it seems like so far so good with respect to finding synergies, which I know is difficult in this industry. But the costs are down. Speaker 600:31:47The share price is up. And at least by my math, it's above NAV. So that part of the thesis has played out thus far. I'm curious if that is opening the doors for other opportunities. And Petrus, I know you talked about the next merger, what have you. Speaker 600:32:06Are you finding potential sellers out there that can look at that transaction and say, this is a good liquidity of that for me and a way to maximize value for my assets and at the same time you guys can utilize your shares as a currency? Speaker 500:32:26Well, look, everything like this helps, right? Closing one deal and doing a good job of it is clearly going to help our reputation in the market for other deals. But I don't underestimate how hard these deals are Speaker 100:32:45to get Speaker 500:32:45done. We have gotten a lot of them done, but it's they're always hard to close and they're always low probability. That being said, we're looking at possible transactions. And we may be able to do 1 or more. We certainly intend to try to keep growing. Speaker 600:33:13Okay. That's all. And I guess, are you, I don't know, maybe more optimistic about that than maybe you would have been a few months ago? Speaker 500:33:25I think we are more optimistic. But I hope our optimism is actually able to influence the way the world works. We're doing our best. All right. Speaker 400:33:42Ben, I think that we are more optimistic than usual also because of the environmental regulations. I think they will have an impact a positive impact on the supply. And I think this is going to happen to take place for several years going forward. So that's a good basis for our optimism, I believe. Speaker 500:34:14Yes. I mean, what the environmental regulations do in large part is make it no funds to operate a small shipping company. For a long time, for centuries, it's been great fun to operate a small shipping company. I think that's changing. And the business is becoming less fun and more sort of demanding of a large corporate organization. Speaker 600:34:43Yes. Well, it's always fun to have fun. SoRead morePowered by