Star Bulk Carrier: 28% Drop in Freight Rates
Star Bulk Carriers Corp. (Nasdaq: SBLK),a global shipping company focusing on the transportation of drybulk cargoes, announced that its Board of Directors declared a cash dividend of $0.05 per outstanding share of the Company's common stock for the three months ending September 30, 2011. The dividend is payable on or about December 6, 2011 to shareholders of record as of November 29, 2011. The Company also announced today its unaudited financial and operating results for the three and the nine months ended September 30, 2011. The Company also announced today the results of the Annual GeneralMeeting of its shareholders held on Friday,October21, 2011.
"The weak market conditions during the third quarter 2011 impacted our results as we earned an average daily time charter equivalent rate of $18,808, a 28% decrease from the same period in 2010. Despite the challenging quarter, we remain optimistic about the future of Star Bulk Carriers as we continue to make significant progress towards improving our future financial results," Spyros Capralos, President and CEO of Star Bulk, said. Star Bulk's developments and highlights so far in 2011 include the significant expansion of our fleet and the continued success in optimizing our operating costs. In addition, we are pleased to have received approval from our Board of Directors to reward shareholders by declaring our tenth consecutive quarterly dividend.
"Our fleet profile will have a new addition within the next few days with the delivery of our second new building capesize the Star Polaris. This acquisition will increase the size of our fleet to 15 vessels while enhancing our revenue. As of today, our total contracted gross revenue is $220 million and our fleet employment coverage stands at 94% for 2011 and 52% for 2012. We are currently in discussion with a number of charterers about contracting the vessels with expiring contracts on period employment. The great majority of these vessels are in the Supramax class and this market has been much less volatile then the larger size segments.
"We want to assure our shareholders that our focus is on making Star Bulk a leader in the dry bulk industry and we feel this can be achieved with our solid financial position. We look at today's weak market conditions as an opportunity for our company to take advantage of distressed assets that do not arise during peak markets."
Simos Spyrou, Chief Financial Officer of Star Bulk, commented: "As of today, our outstanding debt amounts to $267.6m with $1.5m in principal repayment due for the remainder 2011 and our cash position stands at $39m. Furthermore, our loan repayments for 2012 and 2013 are $35m for each year. As we have no exposure to interest rate swaps, we are able to take advantage of the prevailing low interest rate environment. The increase to our operating expenses for the third quarter 2011 versus the previous quarter was mainly due to the increase in the average number of vessels, since our fleet grew from 11 to 14 vessels during this quarter. Even though our general and administrative expenses have increased in third quarter of 2011 compared to the previous quarter, they remain 14% lower compared to the same quarter in 2010."