Safe Bulkers remained in the black for the first quarter of 2019 as contract coverage on its fleet helped shield the New York-listed company from a depressed freight market.
Polys Hajioannou’s Safe rang in a profit of $5.4m in the opening three months of 2019, down 10% on a year-on-year basis following a Vale dam disaster this January which sent rates into a tailspin.
Its profit of $0.03 per share edged ahead of Wall Street forecasts during a period in which several peers have slipped into the red.
Adjusted profit of $2.8m was better than the $1.7m consensus, according to DNB Markets.
Loukas Barmparis, president of Safe Bulkers, said the company had started 2019 in profit despite the material weakness of the charter market amid trade-war concerns, disruption of trade patterns due to natural disasters and seasonality inherent in the industry.
Much of the Safe Bulkers fleet has shorter term charter coverage, with most of its capesize fleet secured on longer contracts.
While coverage sits at 66% for 2019, it falls to just 9% presently for 2020, a period in which rates are expected to spike as new emissions rules kick in.
The company is fitting scrubbers to around half of its fleet.
Safe has three ships set to go into dry-dock for scrubbers during the present quarter, with 10 to follow in the third quarter and a further six by the end of the year.
One more vessel will have a scrubber fitted in the early weeks of 2020.
“We are on schedule in implementing our environmental investments installing scrubbers in approximately half of our fleet during 2019 in anticipation of the effectiveness of the IMO sulphur cap regulations in 2020,” Barmparis said.
“We also remain committed to installing ballast water treatment systems in each of our vessels.
“Overall, we remain confident that our company is well positioned ahead of the uncertainties and opportunities presented by the current operating environment.”
