Star Bulk Carriers Corp. (NASDAQ:SBLK) Q4 2022 Earnings Call Transcript

Chris Robertson: Got it. No, that’s really helpful. Just really quick last question for me, I mean, I think capital discipline is very much a feature of Star Bulk. You guys have done an incredible job over the years doing a creative acquisitions, in the past using your shares as currency. So I guess that said, you might not be looking at any deals on the table at the moment. But kind of looking forward, do you think there’s interesting opportunities out there, generally speaking for either en bloc acquisition or kind of anything that’s come to you that you found compelling?

Hamish Norton: Well, Chris, we are looking at things now and we’re hopeful that the environment may be a little easier to close deals in than it has been in the last year or so. So, we’re optimistic actually that we may be able to get things done.

Operator: Our next question is from Omar Nokta with Jefferies. Please proceed with your question.

Omar Nokta: I was going to ask but before I get to what I was planning on asking, maybe Hamish, could I ask, I know it’s probably a bit sensitive, but in terms of getting deals done, is that — would that be kind of along the Star Bulk way in the past of using shares in those deals?

Hamish Norton: Everything, we’re looking at would involve shares.

Omar Nokta: Okay. Thank you. So, I did want to ask maybe just a bit broadly about the earnings power of the Company. It looks like based off of on Slide 13 that the bookings you’ve got so far in the first quarter that even if rates remain as soft as they are, you’ll remain profitable in the first quarter. And my question is, I guess one, do you agree that you could remain in positive territory here in the first quarter? And then also, if we assume no changes in the market from here, and holding all else equal in terms of say, fuel spreads or eco spreads or maybe the size premium you’re able to capture with your bigger vessels, would you be profitable the second quarter also? And I guess what I’m getting at is really just trying to get a sense for how much of you being profitable in this down market as a result of fixing shifts earlier before the pullback and spot rates, and then really how much of it due to the quality premiums you were able to capture across the different shifts you have?

Petros Pappas: Hi. I am, Petros. Yes, I think, we’ll be profitable during Q1. I believe our break giving is around $12,000, and you see that we’re just above 15,000 right now. The bulk of our open position has to do with Newcastlemax, and we think that we’ll be able to maintain the level depending of course how market goes. One thing you have to understand is the following. You look at the spot rate being like $2,500 on the capes, but that is according to a speed of I think 13 knots. What we usually do in situations like this is like that, we slow steam the vessels and a trip that would calculate the 2.500 actually ends up calculating at 8,000 because we burn much less fuel oil. If to that you add the scrubber benefit, which for capes Newcastlemax is higher than other vessels, and the carrying capacity of the bigger vessels, you can reach levels which should be very close to what the average is, even if the market during March stays where it is.