Star Bulk Carriers has reported its best first-quarter result since 2009 with its net profit for the first three months of the year up nearly five-fold compared to a year ago.
The US-listed company reported net income of $170.3m for the January to March 2022 period versus the $35.7m achieved 12 months ago.
Star Bulk, which is the third largest bulker owner in the world by deadweight capacity according to Clarksons, achieved a time charter equivalent (TCE) rate for the quarter of $27,405 per day, per vessel, a year-on-year increase of 77%.
During the quarter Sea Bulk’s capesize and newcastlemax vessels earned an average TCE rate of $26,236 per day, while the TCE rates for its post-panamax, kamsarmax and panamax ships were $27,994, and $27,169 per day for its and ultramax and supramax vessels.
“This result marks our strongest daily TCE performance for the first quarter of a year, when rates are traditionally weaker, since 2009,” said Star Bulk chief executive Petros Pappas.
“Looking to the next quarter, we have covered 74.3% of our available days for the second quarter at a TCE of $29,759 per day, per vessel.
“We continue to return profits to our shareholders, with the board of directors approving a dividend of $1.65 per share as per the company’s existing dividend policy.”
Looking ahead, Pappas said dry bulk market prospects are favourable, notwithstanding the challenging global economic conditions.
“The main driver remains the limited supply growth with the historically low vessel orderbook and the upcoming environmental regulations further suppressing orders and speeds,” he said.
“Demand is still robust with continued strong commodity flows over longer distances due to infrastructure investments and trade dislocations.”
Separately, Star Bulk said on Tuesday it repaid the outstanding amounts of $83.6m under the lease agreements of the seven vessels acquired in February 2021 from Eneti.
It has received credit committee approval from a major European Bank for an amount of up to $100m to replenish the cash used for the prepayment of the outstanding lease amounts and to refinance two additional vessels with an outstanding debt balance of $16.1m.
As a result of the new facility, Star Bulk said it expects to save around $1.5m per year in interest costs.
Star Bulk operates a fleet of 128 vessels, with an aggregate capacity of 14.1m-dwt, consisting of 17 newcastlemax, 22 capesize, two mini-capesize, seven post-panamax, 41 kamsarmax, two panamax, 20 ultramax and 17 supramax bulkers.
