Costamare is looking to spend almost five times its third-quarter profit on exhaust gas scrubbers for five ships being chartered to Mediterranean Shipping Company (MSC).
The New York-listed company may invest up to $30m total on the installations, announced today in the company's quarterly earnings report.
"The cost, it depends on the scrubber, but I would say for a large containership vessel, it could be -- and up to $6m, the total cost," chief financial officer Greg Zikos said during today's earnings call.
"Now the installation ... could be like four to six weeks."
He said the total expenditure includes the costs of equipment, installation, drydocking and other factors.
"You'll have to sort of look at each case individually," he said.
Yesterday, the company reported $6.1m available to shareholders on $90m in revenue for the quarter, up from a $18.8m shareholder profit on $101m in revenue a year earlier.
Costamare plans to install scrubbers on the 9,403-teu MSC Asov, MSC Ajaccio and MSC Amalfi (all built 2014) and increase their daily $43,000 fix rates to their respective ends in December 2023, February 2024 and March 2024.
The company also expects to put them on the 8,827-teu MSC Athens and MSC Athos (both built 2013), upping their $42,000 daily rates for the remainder of their charters ending January 2023 and February 2023.
Costamare has also agreed to extend the charters for all five ships for another ythree years.
Zikos told TradeWinds that the company will probably discuss financing for the scrubbers during the fourth-quarter earnings call.
"It's a bit premature to discuss now," he said.
More scrubbers?
Costamare's plans to install more IMO 2020 devices on ships coming off hire would depend upon future chartering agreements, Zikos said.
"If it is a ship coming out of charter over the next months and without a long-term or a medium-term employment and without an agreement with the charterer regarding the payback period of this investment, we wouldn't be installing scrubbers," he said.
