Euroseas NASDAQ: ESEA outlined its fleet expansion plans, charter coverage, and recent financial performance during a webinar hosted by Capital Link, with Chairman and CEO Aristides Pittas leading the presentation and a brief Q&A session.
Fleet profile and newbuilding program
Pittas said Euroseas currently has 21 vessels on the water and four vessels under construction, operating in the feeder and intermediate segments of the container market. He noted the company has been publicly listed since 2005 and that his family controls more than 50% of the shares, which he said aligns management with shareholders.
He described the current fleet as:
- Six intermediate vessels of about 4,300 TEU, averaging roughly 18 years of age.
- 15 feeder vessels, including six older ships and nine newer vessels built at Hyundai and delivered between 2023 and 2025.
In addition to those recent deliveries, Pittas said the company has ordered four additional intermediate vessels scheduled for delivery in 2027 and 2028, which he said are expected to support further earnings growth.
Efficiency initiatives and emissions focus
Pittas highlighted two initiatives pursued over the last three years: ordering newbuildings he characterized as economical, efficient, and low-emissions, and installing energy-saving devices on existing ships. He said these upgrades are intended to reduce fuel consumption and improve charter attractiveness, with the goal of achieving higher charter rates while also reducing environmental impact.
Charter coverage and rate visibility
Euroseas emphasized its forward employment profile. Pittas said the company is largely covered for 2026 and beyond, with charter rates “at very high levels.” He cited the following figures from the presentation:
- 2026: coverage at about $31,000 per day for 83% of open days, with management negotiating an additional two-year re-charter that could raise coverage to about 90% (not finalized at the time of the webinar).
- 2027: coverage at $32,600 per day for roughly two-thirds of open days.
- 2028: coverage above $32,000 per day.
He added that the company expected to fix additional 2026 open ships “within the next few months” at still-high rates, based on current market conditions.
Financial results, dividends, and balance sheet
While Pittas said Euroseas was still preparing its fourth-quarter financial statements and could not discuss them, he reviewed the company’s previously released nine-month results. For that period, he said the company averaged 22.6 vessels owned at an average rate of $28,735 per day, generating $170 million in total net revenue and roughly $100 million in net income. He also cited:
- Net income attributable to common shareholders: $85 million, or $12.2 per adjusted diluted share.
- EBITDA: $115 million.
- Dividend: $0.70 per share for the third quarter (annualized to $2.80 per share), which Pittas said implied a yield of about 5% based on a $53 share price referenced during the presentation.
Pittas said the dividend represented about 15% of earnings, with the remainder retained to support fleet growth and liquidity. He also pointed to a break-even cost of $12,000 per day per vessel, comparing it to charter rates of $30,000-plus to illustrate what he characterized as substantial margins.
On the balance sheet, Pittas said bank debt totaled about $224 million, or roughly 33.3% of total book value of assets. He also provided a company estimate of $680 million as the charter-adjusted market value of the fleet versus a $510 million book value, and said this implied net asset value of about $85 per share. With the stock referenced at $53, he said the shares were trading at a 38% discount to NAV.
Market outlook and Q&A highlights
Pittas reviewed broad container shipping dynamics, noting the sector’s historically low-rate period from 2010 to 2020 following heavy ordering in 2005–2008, the subsequent COVID-era surge, and later increases tied to Red Sea disruptions. Looking forward, he said Euroseas expects some normalization and rate reductions in 2026 and 2027 if conditions stabilize, though he said he still expected rates to remain profitable. He also cited a container sector order book of about 34%, while arguing the subsector up to 6,000 TEU has a relatively older fleet profile and comparatively lower ordering.
During the Q&A, Pittas said key charter counterparties include Maersk, CMA, OOCL, and ZIM, describing them as strong companies. He said the company does not see realistic opportunities to acquire smaller listed competitors, given the limited number of public container ship operators and their relative size. On fuels and decarbonization, he said Euroseas’ ordered ships are LNG-ready, but he expressed doubt LNG will be the dominant fuel and said he expects conventional fuels to remain for some time, citing slower-than-anticipated decarbonization progress.
He also addressed capital allocation, saying Euroseas has a share repurchase program and that management would weigh buybacks against dividends, liquidity, and funding growth. At current trading levels, he said management would “continue doing some buybacks,” while maintaining a balance with dividends and cash reserves.
About Euroseas NASDAQ: ESEA
Euroseas Ltd. NASDAQ: ESEA is an international shipping company specializing in seaborne transportation of containerized and drybulk cargoes. Incorporated in Bermuda with its principal operations and management office based in Athens, Greece, the company owns and charters a diversified fleet of containerships, drybulk carriers and multipurpose vessels. Euroseas provides tailored shipping solutions on time-charter and voyage-charter agreements, serving manufacturers, commodity traders and logistics providers across major trade routes.
Euroseas’s fleet comprises both owned and chartered tonnage, enabling the company to adjust capacity to market conditions and customer requirements.
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