| Star Bulk has suffered greater than expected losses but confirmed strong progress on newbuilding finance despite the rate slump. The company, which is the largest US-listed dry bulk player, posted a net loss of USD8.1 million for 4Q14 versus net income of USD54,000 in 4Q13. Excluding special items, Star Bulk had an adjusted net loss of USD5.5 million in the most recent period compared with adjusted profits of USD2.1 million in the same period the year before. The adjusted 4Q14 loss of $0.06/share was below the analyst consensus forecast of a loss of $0.04/share. Timecharter equivalent rates averaged USD11,384/day in 4Q14, down 21% from USD14,467/day in 4Q13. But due to synergies from a much larger fleet, average daily operating expenses were USD4,704/day in the most recent period against USD5,392/day a year before. “We are committed to taking measures to protect our shareholders’ equity value and enhance our ability to weather one of the most challenging dry bulk markets in the last 40 years,” said Star Bulk chief executive Petros Pappas. “We remain optimistic regarding the fundamental long-term dynamics. Although 2015 will be challenging, we expect a significant correction in the supply of vessels, which combined with continued strong demand for commodities will create the necessary conditions for a healthier market in the future.” In response to historically low rates, Star Bulk has sold five older vessels. It confirmed on 20 March that “there will be further disposals of vessels that do not fit the profile of our fleet”. Star Bulk has 32 newbuildings on order. It has negotiated the deferral of certain pre-delivery installment payment for newbuildings being delivered in 2015/16 and has negotiated the delayed delivery of certain newbuildings. The company confirmed on 20 March that it had obtained another $227.5M in financing commitments, covering five newbuildings. As a result, 30 of its 32 newbuildings are financed. Star Bulk said it is “in final negotiations with two major lending institutions for the financing of our two remaining newbuilding vessels”. |