Tonnage provider Global Ship Lease (GSL) has secured long-term forward charters for 10 container ships.
The contracts will lift the value of the New York-listed company’s forward cover to more than $2.2bn, spread over almost three years, said executive chairman George Youroukos.
The 10 mid-sized vessels have been fixed for periods of five years for charters starting in late 2022, 2023, and 2024.
The deals, which were done in the third quarter, will provide GSL with over $770m of contracted revenues, Youroukos said.
The contracts include four of GSL’s traditional panamax boxships of 4,000-teu to 4,250-teu.
Charters for those ships will commence in the fourth quarter of this year and the first quarter of 2023.
The other deals relate to six eco-6,900 teu ships that have been forward-fixed with Germany’s Hapag-Lloyd. Charters commence in the fourth quarter of 2023 and 2024.
Uncertain times
So far this year, GSL has added $920.3m to the company’s forward charter on 11 vessels, including one 8,600-teu vessel.
“These are uncertain times, with the world facing macro headwinds, geopolitical tensions, rising interest rates, and inflation,” Youroukos said.
“Against this backdrop, we have continued to focus on making Global Ship Lease as resilient as possible," he said.
That could be achieved "by building our forward contract cover, fortifying our balance sheet, and positioning ourselves to weather the challenges and take advantage of the opportunities that arise in a cyclical industry such as ours,” he added.
Chief executive officer Ian Webber added that GSL had a “conservative, risk-averse business model”.
“Even as central banks have raised interest base rates to the highest levels seen in over a decade, we have successfully reduced our overall cost of debt to 4.53%, which is only slightly higher than the Federal Reserve’s benchmark interest rate.”
He added the company has fully hedged exposure to floating interest rates.
“Furthermore, we have no refinancing requirement before 2026,” he said.
Profits for GSL rose 42.4% in the third quarter to $89.6m, up from $62.9m in the same period in 2021.
Operating revenue rose 24.5% to $172.5m.
The company has embarked on a share buyback and recently repurchased an additional $15m of its own common shares. That had taken the total share repurchases to $20m, Webber said.
GSL owns 65 container ships, ranging from 1,118 teu to 11,040-teu.
