Bulk Shipping Company Shaves Loss by Good Housekeeping

Greece's Star Bulk Carriers Corp. announce its unaudited financial & operating results for the 3 & the 12 months ended December 31, 2012.

Star Bulk is a global shipping company providing worldwide seaborne transportation solutions in the dry bulk sector. Its vessels transport major bulks, which include iron ore, coal and grain and minor bulks including bauxite, fertilizers and steel products.

The company reported a net loss of about US$315-million in 2012. On January 2, 2013, Star Bulk announced that the Company had reached an agreement with its lenders for the deferral of a minimum of $20.2 million of its principal repayments and the relaxation of its financial covenants during 2013 and 2014.

Spyros Capralos, President and CEO of Star Bulk, commented: "We have agreed to sell our oldest Capesize vessel, the Star Sigma, for scrap, at a contracted price of $9.0 million, which will assist in deleveraging of our balance sheet and further relaxation of our principal amortization requirements for 2013 and 2014. Following the sale of Star Sigma, the coverage of our capesize fleet is at 88% for 2013 at an average gross rate of $23,650."

"We view the agreements the Company announced in January as a clear demonstration of our lenders’ trust and support towards the company. We believe these agreements are crucial for the Company’s future, as they provide to the Company additional liquidity and financial flexibility."

Simos Spyrou, Chief Financial Officer of Star Bulk, commented: “Last quarter our results were negatively affected by the low Supramax charter rates and the repositioning of part of our fleet to the Atlantic."

"Another negative effect came from the Star Polaris, which lost 49 days of hire during the fourth quarter, due to main engine repairs. Star Polaris went back to service on 19 November, 2012 at a gross rate of $16,500 per day."

On the positive side, we received a non-recurring net amount of $0.9 million related mainly to the settlement of commercial claims, which effectively offset the Star Polaris off-hire and the low Supramax rates within the quarter.

"In addition, the Company has continued to successfully implement its cost optimization strategy. We succeeded in further reducing our average daily OPEX for the full year 2012 to $5,361, or by 5%, compared to 2011."

"What needs to be underlined is the reduction of our general and administrative (G&A) expenses by 25% to $9.3 million in 2012. This reduction was achieved, while the average number of our employees has increased in order to support the third-party vessels we have recently taken under management, that is already contributing to our revenues. We continue our efforts towards operational and management efficiency and we feel optimistic about the future of the Company.”