Shareholders in Euroseas, a US-listed owner of 27 container ships on the water or under construction, can again lay claim to part of the company’s rapidly growing profits.

The Aristides Pittas-led company announced late on Monday that it has reinstated a dividend payment of common stock after almost nine years.

It had suspended quarterly common dividends in the fourth quarter of 2013 when it still had a mixed fleet of container ships and bulkers.

Since then, it had been paying dividends — either in cash or in kind — on preferred shares only. These preferred shares were owned in part by Pittas himself or others affiliated with the company.

The moment to reward ordinary shareholders has returned, however, as container ship earnings soar on the back of supply chain disruptions.

The $0.50-per-share payout comes after the company reported net income of $29.9m in the first quarter from a mere $3.8m in the same period last year.

This was underpinned by time charter revenue more than tripling to $47.1m from $14.9m a year earlier.

Not nearly reflecting value

The dividend payment may help boost the share price, which Pittas said still fails to “reflect the mere value of our contracted earnings, let alone the net asset value of the company”.

Euroseas shares traded at $27.90 apiece on the Nasdaq on 23 May, giving a market value of $204m.

To prove his faith in the upside of the stock, management announced a $20m share repurchase programme, which it may use at its discretion over 12 months.

Pittas said the dividend payment represents just “a small part” of Euroseas’ contracted earnings and will not affect the “growth philosophy” that saw it expand recently through secondhand purchases and newbuildings.

Despite uncertainties over the prospect of global economic growth due to the Ukraine war and inflation worries, Euroseas expects the trailing effects of the pandemic on supply chains to maintain the container ship market at “strong” levels in the “near and medium term”.

As contracted charters provide earning visibility “well into 2024”, the company feels confident enough to continue scouring the market for further secondhand acquisitions or newbuildings, Pittas said.

Burgeoning charter rates in the container ship market have already allowed the company to cover the building cost of the first two of the nine newbuildings it has under construction.