Nasdaq-listed Euroseas is seeing profits rise as container feeder markets benefit from the charter market boom.
The Athens-based tonnage provider has taken delivery of the first of four feeder container ship newbuildings for delivery this year.
These are expected to reap the benefits of the “unexpected comeback” of container markets in the past two months, said chief executive Aristides Pittas.
Pittas noted that one-year feeder boxship charter rates are up by approximately 35% from the lowest levels reached in December 2023.
That was due to longer travel routes as vessels avoided the Red Sea and Suez Canal.
“Clearly, the extent to which such attacks on shipping continue will shape the near-term development of charter rates,” Pittas said.
“Certain of our vessels benefited from this better rate environment in their charter renewals and we expect that the next four of our newbuildings which are being delivered over the next four to five months will benefit too.”
Beyond the Red Sea disruptions, the challenge for container markets was “the absorption of the still high orderbook which, however, has started declining”, Pittas said.
Revenues and profitability were higher thanks to a slightly larger fleet averaging 19 vessels.
The company reported a net income of $24.7m for the three months ending on 31 December last year. That is up from $20.3m in the same period a year earlier.
Net revenues rose 14% to $49m for the quarter.
Pittas regards the profitability of his company as protected in 2024 by the contracted revenue backlog of more than $350m.
Growing fleet
Euroseas owns and operates 20 container ships, mostly feeders but including a handful of traditional panamax vessels.
The company took delivery on 6 February of the 2,800-teu feeder Tender Soul (built 2024).
The vessel has been chartered to AP Moller-Maersk for eight to 10 months at $17,000 per day. The vessel operates on the Danish carrier’s transpacific service to the US West Coast.
The Tender Soul is the third in a nine-vessel feeder newbuilding programme under construction at Hyundai Mipo Dockyard.
The rate is, however, down from the rates for two of the 2,800-teu vessels delivered last year.
The 2,800-teu Gregos and Terataki (both built 2023) are on three-year charters until the second quarter of 2026 at $48,000 per day.
That leaves Euroseas expecting delivery in 2024 of three more 2,800-teu vessels in the series, the Leonadis Z, Dear Panel and Symeon P.
In addition, the company has three 1,809-teu Bangkokmaxes on order at Hyundai Mipo Dockyard for delivery this year.
