EuroDry Ltd., an owner and operator of drybulk vessels and provider of seaborne transportation for drybulk cargoes, announced today its results for the three and nine-month periods ended September 30, 2024.
Total net revenues for the quarter of $14.7 million.
Net loss attributable to controlling shareholders, of $4.2 million or $1.53 loss per share basic and diluted, respectively.
Adjusted net loss attributable to controlling shareholders for the quarter of $3.9 million or $1.42 loss per share basic and diluted, respectively.
Adjusted EBITDA for the quarter was $0.5 million.
An average of 13.0 vessels were owned and operated during the third quarter of 2024 earning an average time charter equivalent rate of $13,105 per day.
To-date, about $5.0 million have been used to repurchase 314,337 shares of the Company, under our share repurchase plan of up to $10 million, announced in August 2022.
Recent developments :
The Company refinanced two of its loans involving four of its vessels drawing approximately an incremental $16 million thus increasing its cash reserves, extending maturities to 2029 and 2030, respectively, and decreasing interest cost margin.
Nine Months 2024 Highlights:
Total net revenues of $46.6 million.
Net loss attributable to controlling shareholders was $6.4 million or $2.34 loss per share basic and diluted.
Adjusted net loss1 attributable to controlling shareholders for the period was $7.5 million or $2.77 adjusted loss per share basic and diluted1, respectively, before unrealized gain on derivatives.
Adjusted EBITDA was $7.6 million.
An average of 13.0 vessels were owned and operated during the first nine months of 2024 earning an average time charter equivalent rate of $13,339 per day.
Aristides Pittas, Chairman and CEO of EuroDry commented: “During the third quarter of 2024, the average earnings for Kamsarmax/Panamax and Ultramax vessels declined, with these declines continuing through October and early November. Although fleet growth during 2024 has been modest by recent historical standards, demand for vessels has weakened, especially, during the second half of the year due partly to the reversal of certain short term factors like Panama Canal throughput constraints but more importantly due to weak demand from China. China’s economic growth and the resulting demand for drybulk trade is one of the key factors affecting the drybulk market and one of the main challenges the latter faces. The recent announcement of additional stimulus by China could change the near and medium term prospects of the Chinese economy but its final effect remains to be seen. Still, the biggest source of optimism in the market comes from the supply side which is expected to grow very modestly over the next couple of years.
“In the third quarter of 2024, we exploited the weakness of the market during the summer to early drydock two of our ships to improve their commercial prospects. In addition, two more of our vessels underwent their scheduled drydock. Consequently, our quarterly results were influenced by both the weakness of the market and the cost of the drydockings and related offhire days. With those drydockings completed, our fleet is better positioned to benefit from potential market increases in 2025.
“At the same time, we continue exploring investment opportunities in secondhand or newbuilding projects, especially, as recent market declines resulted in lower vessel values. In this context, we also increased our “firepower” through loan refinancings securing about $16 million in extra liquidity. As always, our focus remains to identify and undertake accretive investment opportunities to generate returns for our shareholders.”
Tasos Aslidis, Chief Financial Officer of EuroDry commented: “Comparing our results for the third quarter of 2024 with the same period of 2023, our net revenues increased by about $4.7 million, due to the increased number of vessels as compared to the third quarter of 2023. The time charter equivalent rates for the period were higher by 8% on average compared to the time charter equivalent rates our vessels earned in the third quarter of 2023. Operating expenses, including management fees, increased from $6,003 per vessel per day in the third quarter of 2023 to $6,147 in the third quarter of 2024, while General and Administrative expenses averaged $704 per vessel per day during the third quarter of 2024 as compared to $677 per vessel per day for the same quarter of last year partly due to higher (non-cash) cost of the Company’s stock incentive plan and certain administrative expenses for the entities owning the M/V Christos K and M/V Maria represented by NRP Project Finance AS (“NRP investors”) (the “Partnership”).
“Adjusted EBITDA during the third quarter of 2024 was $0.5 million compared to $3.1 million achieved for the third quarter of last year. As of September 30, 2024, our outstanding debt (excluding the unamortized loan fees) was $94.6 million while unrestricted and restricted cash was $7.6 million. As of the same date, our scheduled debt repayments including balloon payments over the next 12 months amounted to about $11.1 million (excluding the unamortized loan fees) and all our loan covenants are satisfied.”
Third Quarter 2024 Results:
For the third quarter of 2024, the Company reported total net revenues of $14.7 million representing a 47.0% increase over total net revenues of $10.0 million during the third quarter of 2023, which was primarily the result of the increased average number of vessels operating in the third quarter of 2024 compared to the corresponding period of 2023 and the increased charter rates earned. On average, 13.0 vessels were owned and operated during the third quarter of 2024 earning an average time charter equivalent rate of $13,105 per day compared to 10.0 vessels in the same period of 2023 earning on average $12,126 per day.
For the third quarter of 2024, voyage expenses, net amounted to $1.5 million and mainly relate to vessels repositioning between charters and expenses during operational off-hire time. For the third quarter of 2023, a gain on bunkers resulted in positive voyage expenses of $0.1 million.
Vessel operating expenses increased to $6.3 million for the third quarter of 2024 from $4.7 million for the third quarter of 2023. The increase is attributable to the increased number of vessels operating in the third quarter of 2024 compared to the corresponding period in 2023.
Depreciation expense for the third quarter of 2024 amounted to $3.5 million, compared to $2.6 million for the same period of 2023. This increase is again due to the higher number of vessels operating in the third quarter of 2024 as compared to the same period of 2023.
General and administrative expenses increased to $0.8 million in the third quarter of 2024, as compared to $0.6 million in the third quarter of 2023. This increase is mainly attributable to the increased cost of our stock incentive plan in the third quarter of 2024 compared to the same period of 2023.
Related party management fees for the period were $1.1 million compared to $0.8 million for the same period of 2023, again due to the increased number of vessels owned and operated in the third quarter of 2024, as well as due to the adjustment for inflation in the daily vessel management fee, effective from January 1, 2024, increasing it from 775 Euros to 810 Euros and the unfavorable movement of the euro/dollar exchange rate.
During the third quarter of 2024, four of our vessels completed their special survey with drydocking for a total cost of $4.5 million. During the third quarter of 2023, one of our vessels completed her special survey with drydocking, for a total cost of $0.8 million.
Interest and other financing costs for the third quarter of 2024 amounted to $2.0 million compared to $1.6 million for the same period of 2023. Interest expense during the third quarter of 2024 was higher mainly due to the increased amount of debt of our loans during the period as compared to the same period of last year.
For the three months ended September 30, 2024, the Company recognized a $0.3 million unrealized loss and a $0.05 million realized gain on one interest rate swap contract. For the three months ended September 30, 2023, the Company recognized a $0.14 million unrealized gain and a $0.05 million realized gain on one interest rate swap contract. Interest income for the third quarter of 2024 amounted to $0.02 million compared to $0.4 million interest income for the same period of 2023. The decrease in interest income is attributable to lower cash balances maintained during the third quarter of 2024 compared to the corresponding period in 2023.
The Company reported net loss for the period of $5.2 million and a net loss attributable to controlling shareholders of $4.2 million, as compared to a net loss and a net loss attributable to controlling shareholders of $0.5 million for the same period of 2023. The net loss attributable to the non-controlling interest of $1.0 million in the third quarter of 2024 represents the loss attributable to the 39% ownership of the Partnership.
Adjusted EBITDA for the third quarter of 2024 was $0.5 million compared to $3.1 million achieved during the third quarter of 2023.
Basic and diluted loss per share attributable to the Company for the third quarter of 2024 was $1.53 calculated on 2,729,603 basic and diluted weighted average number of shares outstanding, compared to loss per share of $0.19 calculated on 2,758,013 basic and diluted weighted average number of shares outstanding for the third quarter of 2023.
Excluding the effect on the loss attributable to controlling shareholders for the quarter of the unrealized loss on derivatives, the adjusted loss for the quarter ended September 30, 2024 would have been $1.42 per share basic and diluted, compared to adjusted loss of $0.24 per share basic and diluted, respectively for the quarter ended September 30, 2023. Usually, security analysts do not include the above item in their published estimates of earnings per share.
First Nine Months 2024 Results:
For the first nine months of 2024, the Company reported total net revenues of $46.6 million representing a 47.0% increase over total net revenues of $31.7 million during the first nine months of 2023, which was mainly the result of the increased number of vessels operated during the nine-month period of 2024 compared to the same period of 2023 and the increased charter rates earned. On average, 13.0 vessels were owned and operated during the first nine months of 2024 earning an average time charter equivalent rate of $13,339 per day compared to 10.0 vessels in the same period of 2023 earning on average $11,644 per day.
For the nine months of 2024, voyage expenses, net, were $5.2 million and relate to vessels repositioning between charters and expenses during operational off-hire time. For the nine months of 2023 voyage expenses, net, were $3.4 million and mainly relate to expenses incurred by one of our vessels while employed under a voyage charter and expenses during the detention of one of our vessels in Corpus Christi.
Vessel operating expenses were $19.1 million for the nine months of 2024 as compared to $14.8 million for the same period of 2023. The increase is mainly attributable to the increased number of vessels operating in the first nine months of 2024 compared to the corresponding period of 2023.
Depreciation expense for the first nine months of 2024 was $10.4 million compared to $7.7 million during the same period of 2023, mainly due to the higher number of vessels operating in the same period.
Related party management fees for the first nine months of 2024 were increased to $3.2 million from $2.3 million for the same period of 2023 as a result of an adjustment for inflation in the daily vessel management fee, effective from January 1, 2024, increasing the daily vessel management fee from 775 Euros to 810 Euros and the increased number of vessels operating partly offset by the favorable movement of the euro/dollar exchange rate during the period.
General and administrative expenses increased to $2.4 million during the first nine months of 2024 as compared to $2.2 million in the same period of last year. This increase is mainly attributable to the increased cost of our stock incentive plan.
Finally, during the nine months period of 2023, we recorded a provision of $0.5 million for anticipated costs related to the detention of one of our vessels in Corpus Christi presented as other operating loss.
In the first nine months of 2024, seven of our vessels completed their special survey with drydocking for a total cost of $8.2 million. During the same period of 2023, three of our vessels completed their special survey with drydocking for a total cost of $2.9 million.
Interest and other financing costs for the first nine months of 2024 amounted to $6.0 million compared to $4.4 million for the same period of 2023. This increase is mainly due to the increased amount of debt in the current period as well as the increase in the benchmark rates of our loans compared to the same period of 2023.
For the nine months ended September 30, 2024, the Company recognized a $0.1 million unrealized loss and a $0.2 million realized gain on one interest rate swap as well as a $1.3 million unrealized gain and $1.0 million realized loss on FFA contracts. For the nine months ended September 30, 2023, the Company recognized a $1.6 million unrealized loss and a $1.9 million realized gain on four interest rate swaps, three of which were terminated early in the first quarter of 2023, as well as a $2.5 million realized gain on FFA contracts.
Interest income for the first nine months of 2024 amounted to $0.1 million compared to $0.7 million interest income for the same period of 2023. The decrease of interest income is attributable to lower cash balances maintained during the first nine months of 2024 compared to the corresponding period in 2023.
The Company reported net loss for the period of $7.4 million and a net loss attributable to controlling shareholders of $6.4 million, as compared to net loss and net loss attributable to controlling shareholders of $3.3 million, for the first nine months of 2023. The net loss attributable to the non-controlling interest of $1.0 million in the first nine months of 2024 represents the loss attributable to the 39% ownership of the entities owning the M/V Christos K and M/V Maria represented by NRP Project Finance AS (“NRP investors”) (the “Partnership”).
Adjusted EBITDA for the first nine months of 2024 was $7.6 million compared to $8.0 million achieved during the first nine months of 2023.
Basic and diluted loss per share attributable to the Company for the first nine months of 2024 was $2.34, calculated on 2,724,521 basic and diluted weighted average number of shares outstanding compared to loss per share of $1.17, calculated on 2,773,916 basic and diluted weighted average number of shares outstanding.
Excluding the effect on the net loss attributable to controlling shareholders for the first nine months of the year of the unrealized (gain) / loss on derivatives, the adjusted loss for the nine-month period ended September 30, 2024, would have been $2.77 per share basic and diluted, compared to adjusted loss of $0.57 per share basic and diluted, respectively, for the nine-month period ended September 30, 2023. As previously mentioned, usually, security analysts do not include the above item in their published estimates of earnings per share.
Source: EuroDry Ltd.
