Genco Shipping & Trading reported a 48.7% leap in profit as the New York-listed bulker owner announced a dividend payout that landed in line with Wall Street expectations.
The company logged nearly $47.6m in net income in the second quarter, up from $32m in the same period of 2021.
“Drawing on our significant scale and barbell approach to fleet composition, we generated strong earnings in the second quarter,” said chief executive John Wobensmith.
Diluted earnings per share amounted to $1.10.
The second-quarter profit growth was powered by a 13.8% jump in second-quarter revenue, which rose to $138m from $121m in the same period of 2021.
Operating expenses also grew, but more slowly, rising 4.5% to $88.6m in the latest quarter.
“During the second quarter, we continued to voluntarily de-lever our balance sheet, consistent with our medium-term objective of reducing our net debt to zero,” said chief financial officer Apostolos Zafolias.
Genco, which has cut its debt by $261m since the start of 2021, chopped its interest expense to $2.41m, a 46.2% drop compared to the second quarter of last year.
The New York-headquartered shipowner announced that it will spend $21.2m of its cash flow to pay a $0.50 per share dividend for the period.
That is smaller than the previous quarter’s payout, which Genco blamed on the cost of front-loading dry-dockings.
But it marks a fivefold increase from the $0.10 per share dividend that Genco announced a year earlier, before it implemented a high-payout model. The second quarter dividend was also exactly in line with average analyst expectations, according to Fearnley Securities.
Genco also plopped down a $8.75m prepayment on a loan, bringing total debt to $188.5m and leaving liquidity of nearly $270m in cash and undrawn credit.
“Our earnings power remains strong, and we continue to benefit from the significant operating leverage of our sizeable fleet and best-in-class commercial operating platform,” Wobensmith said.
Fleetwide, Genco reported time charter equivalent rates of $28,800 per day in the latest reporting period, which was 36% higher than a year earlier and the highest second quarter for the company since 2010.
Moving into the ongoing third quarter, vessel earnings showed some easing, to nearly $25,100 per day with 79% of available fleet days booked.
“The market continues to be driven by an attractive supply and demand balance and the historically low newbuilding orderbook, which provides a low threshold for demand to exceed supply,” Wobensmith said.