New York-listed Eagle Bulk shipping closed out 2021 with another record quarter and is guiding to more strong rates as its mid-sized bulkers continue to outperform larger units.
The Stamford, Connecticut-based shipowner turned in net income of $87.5m, or $6.79 per share. However, its adjusted net income of $5.40 per share fell well short of consensus analyst expectations of $6.19 per share, according to investor website Seeking Alpha.
The profit allowed Eagle to declare a shareholder dividend of $2.05, slightly up from the $2 figure paid on third-quarter earnings of $78.3m under the company’s new dividend policy, which targets a payout of at least 30% of net income.
For the current quarter, Gary Vogel-led Eagle pointed to time charter equivalent (TCE) rates of $27,200 per day with 95% of days booked, nearly double the $15,124 that the company earned in the first three months of 2021.
The first three months of 2021 were considered to be unusually strong for what is traditionally dry bulk’s weakest earnings period, although coming off a much lower prevailing market.
“Eagle achieved record results once again this quarter as we were able to capitalize on the continued strength of the dry bulk market,” Vogel said in the earnings statement. “Our record $88m of net income for the fourth quarter capped off a truly extraordinary year for the company – in terms of fleet growth, balance sheet optimisation, and TCE performance.”
Vogel said Eagle has since October paid down more than $70m in debt and declared cumulative cash dividends of $53m.
It was the second consecutive record quarter for the owner of 53 supramax and ultramax bulkers.
“Looking ahead, we have experienced increased volatility in Q1 on the back of short-term demand impacts in addition to typical seasonal weakness. I believe we have navigated these well,” Vogel said.
While Eagle’s rates for the first quarter have held up well, they are down from the $32,400 TCE the owner had guided to in its last earnings report, with about 75% of operating days booked. This reflects expected seasonal weakness amid factors including the winter Olympics games in Beijing.
The guidance also reflected a premium over the $13,170 average year to date for capesizes and $23,267 by panamaxes, according to Baltic indices. It is also better than the $21,932 average thus far for the Baltic Supramax Index.
Net revenue for the quarter were $184.7m compared to $75.2m for the same period of 2020.
For the year, Eagle reported net income of $184.9m or $14.91 per share.
