Softer dry bulk market squeezes Safe Bulkers profit
- Cyprus- and Greece-based owner continues focus on fleet renewal and environmental upgrades
- One of the company’s older kamsarmaxes has been sold for $12.5m
- New $75m refinancing agreement will link interest margin to sustainability targets
US-listed owner also sees scrubber-related earnings decrease
SAFE Bulkers has posted slimmer second-quarter profits, as it pushes ahead with renewing its fleet of dry bulk carriers.
The Cyprus- and Greece-based owner of 47 bulkers saw net income drop to $1.7m, from $27.6m in the second quarter of 2024.
Safe pointed to a weaker charter market than the same phase of last year, saying revenues fell “due to lower charter hires, decreased earnings from scrubber-fitted vessels and increased operating expenses”.
Net revenues decreased from $78.5m to $65.7m year on year, with Safe’s vessels averaging a daily time charter equivalent rate of $14,857 during the latest quarter, versus an average $18,650 last year.
Stripping out non-cash and one-off items such as two profitable vessel sales in the second quarter of last year and a gain on derivatives this year, the adjusted profit came to $3m, compared with $20.3m in the same period last year.
“We experienced a softer market compared to the previous year, which impacted our revenues and profitability,” said company president Loukas Barmparis.
“We remain focused on fleet renewal, strong liquidity, comfortable leverage and long-term value creation.”
The New York Stock Exchange-listed owner has been gradually renewing its fleet with newbuildings, while “selectively” selling older vessels in the fleet.
The latest sale deal, inked just last week, will see buyers pay $12.5m for its 18-year-old, Japanese-built kamsarmax Pedhoulas Leader (IMO: 9323065).
The outgoing vessel is scheduled to be delivered to the new owners sometime between August and October this year.
Meanwhile, the company has so far taken delivery of 12 Phase 3 and Tier III compliant newbuildings, with another six on order, including two methanol dual-fuelled kamsarmaxes.
In addition, 26 of its existing vessels have so far received an “environmental upgrade” to increase efficiency and lower consumption, a programme that it is “continuing”, it said.
This month, the owner agreed to refinance an existing loan with a $75m sustainability-linked five-year facility, under which the interest margin will be adjusted in relation to the carbon intensity index of the fleet.
Safe’s board has declared an unchanged cash dividend of $0.05 per common share for the latest quarter.
