Other Highlights and Developments:
Quarterly cash dividend of $0.075 per share for Q2 2024
Total cash dividends of $1.525 per share or $12.0 million declared since November 2022, representing approximately 60% of United’s market capitalization2
Completion of the sale of a 2010-built Chinese Kamsarmax at a profit
New initiatives adhering to our strategy for a diversified investment approach:
Minority investment in a newbuilding energy construction offshore vessel (“ECV”) project
Participation in a tanker time-charter agreement
Aggregate financings of $48.3 million year-to-date
United Maritime Corporation (“United” or the “Company”), announced its financial results for the second quarter and six months ended June 30, 2024. The Company also declared a quarterly dividend of $0.075 per common share for the second quarter of 2024.
For the quarter ended June 30, 2024, the Company generated Net Revenues of $12.4 million compared to $10.0 million in the second quarter of 2023. Net Income and Adjusted Net Income for the quarter were $0.7 million and $0.9 million, respectively, compared to Net Loss of $3.0 million and Adjusted Net Loss of $2.1 million in the second quarter of 2023. Adjusted EBITDA1 for the quarter was $6.3 million, compared to $2.0 million for the same period of 2023. The Time Charter Equivalent rate (“TCE rate”)3 of the fleet for the second quarter of 2024 was $17,143 per day.
For the six-month period ended June 30, 2024, the Company generated Net Revenues of $23.0 million, compared to $12.8 million in the same period of 2023. Net Loss and Adjusted Net Loss for the period were $0.7 million and $0.2 million, respectively, compared to Net Loss of $7.9 million and Adjusted Net Loss of $5.7 million in the respective period of 2023. Adjusted EBITDA for the first half of 2024 was $10.0 million, compared to $0.6 million for the same period of 2023. The TCE rate of the fleet for the first six months of 2024 was $16,187 per day.
Cash and cash-equivalents and restricted cash as of June 30, 2024, stood at $7.7 million. Shareholders’ equity at the end of the second quarter was $64.2 million, while long-term debt, finance lease liabilities and other financial liabilities, net of deferred finance costs stood at $90.3 million as of June 30, 2024. The book value of our fleet as of June 30, 2024, stood at $147.8 million, including two chartered-in Panamax vessels and a Kamsarmax vessel held for sale.
Stamatis Tsantanis, the Company’s Chairman & Chief Executive Officer, stated:
"We are delighted to announce United's return to profitability in the second quarter, driven by continued positive momentum in the dry bulk market. Our fleet was strategically positioned to capitalize on this trend through a blend of fixed and index-linked charters. We remain highly optimistic about the long-term prospects of the market and United’s ability to deliver high returns on capital.
"Given the strong dry bulk market conditions, we are pleased to declare our seventh consecutive quarterly dividend of $0.075, yielding approximately 13% annually. Having paid over $1.50 in dividends since our listing two years ago demonstrates our unwavering commitment to consistent shareholder rewards, a core element of our business strategy.
"Commercially, we expect our daily time charter equivalent to be around $17,500 for the third quarter, based on current FFA values. This reflects four of our vessels operating under fixed-rate employment through FFA fixings or time charter trips. Specifically, one of our Capesize vessels, the Goodship, completed its scheduled dry-docking and had energy-saving devices installed, leading to the renewal of its index-linked time charter at a higher daily rate. We successfully executed an extensive capex program, including the dry-docking of three Capesize vessels and one Kamsarmax vessel. Additionally, the M/V Gloriuship has been fixed on a round voyage of 70 to 80 days at a gross daily rate of $22,500. We are pleased with the secured cash flows for the second half of the year, supporting a healthy dividend.
"Fleet-wise, post-quarter, we delivered the 2010-built Chinese Kamsarmax, M/V Oasea, to her new owners, completing this profitable sale. This vessel will be replaced by a 2016-built Japanese Kamsarmax, renamed “Nisea”, acquired through a bareboat-in structure earlier this year, with delivery expected by the end of October 2024. Our fully delivered fleet will remain at eight vessels, while we continue to explore acquisition candidates with high return potential.
"In line with our diversified investment strategy, we have decided to invest in the offshore sector through a minority stake in a newbuilding Energy Construction Vessel. This project, in partnership with experienced Norwegian counterparts, is expected to complete in 2027. The vessel will serve both the oil and gas and renewable energy sectors, addressing the shortage of such vessels amidst growing demand. Additionally, United has partnered to charter-in an Aframax tanker for up to nine months, operated by a prominent tanker pool operator. This move reflects our commitment to deploying capital across different shipping sectors to deliver optimal outcomes for our shareholders, and we are optimistic about our recent investments.
"Our outlook for the dry bulk market remains positive, with the orderbook at historically low levels due to strict environmental regulations and resulting fleet renewal needs. We see the commitment of major miners to large projects providing a stable long-term demand backdrop. This year, strong volume growth in iron ore, coal, bauxite, and grains, coupled with the ton-mile effect of increasing long-haul cargoes, amplifies market strength. We expect this trend to continue, positioning United advantageously to benefit."
Third Quarter 2024 TCE Rate Guidance:
As of the date hereof, approximately 75% of the Company fleet’s expected operating days in the third quarter of 2024 have been fixed at an estimated TCE rate of approximately $17,737. Assuming that for the remaining operating days of our index-linked T/Cs, the respective vessels’ TCE rate will be equal to an average Forward Freight Agreement (“FFA”) rate of $22,977 for Capesize and $16,554 for Kamsarmax per day (based on the FFA curve of July 29, 2024), our estimated TCE for the third quarter of 2024 will be approximately $17,4954. Our TCE rate guidance for the third quarter of 2024 includes conversions of index-linked charter to fixed.
Second Quarter and Recent Developments:
Dividend Distribution for Q1 2024 and Declaration of Q2 2024 Dividend
On July 10, 2024, the Company paid the previously announced quarterly dividend of $0.075 per common share, for the first quarter of 2024, to all shareholders of record as of June 25, 2024.
The Company also declared a cash dividend of $0.075 per common share for the second quarter of 2024 payable on or about October 10, 2024 to all shareholders of record as of September 27, 2024.
New Investment Initiatives
Offshore Sector
In July 2024, the Company entered into shareholder and subscription agreements to acquire a minority stake in a Norwegian-based company, established to design and build a technically and environmentally advanced Energy Construction Vessel (“ECV”). The ECV is intended to inspect, maintain, and repair offshore energy production infrastructure in both the oil and gas and renewables industries. United will commit capital of up to $8.5 million, scheduled to be called in five separate installments over a period of 33 months, matching the different stages of the ECV’s building process. The offshore sector is currently experiencing a dynamic phase characterized by several key factors that enhance its attractiveness. The increased demand for energy, combined with the aging fleet and a limited orderbook, provides a straightforward and structured opportunity for United to diversify into a high-potential alternative sector.
Tanker Sector
In June 2024, the Company entered into an agreement with a third-party operator to participate in a time-charter of an Aframax tanker. The vessel is chartered and managed through the operator’s Aframax pool, while the Company has committed $0.3 million for the vessel's working capital. United will participate in the profits and losses of the subject vessel based on the performance of the time-charter agreement.
Vessel transactions and commercial updates
M/V Exelixsea – Time charter extension
In July 2024, the charterer of the M/V Exelixsea agreed to extend the time charter agreement in direct continuation from the current agreement. The extension period will commence on August 15, 2024, for a duration of about 11 months to about 14 months. The daily hire is based on a revised discount over the BPI 5TC, while all other main terms of the time charter remain materially the same.
M/V Synthesea – Time charter extension
In July 2024, the charterer of the M/V Synthesea agreed to extend the time charter agreement in direct continuation from the current agreement. The extension period will commence on October 1, 2024, for a duration of about 11 months to about 14 months. The daily hire is based on a revised discount over the BPI 5TC, while all other main terms of the time charter remain materially the same.
M/V Goodship – Time charter extension
In July 2024, the charterer of the M/V Goodship agreed to extend the time charter agreement in direct continuation from the current agreement. The extension period commenced in July 2024 for a duration of minimum October 15, 2025, to maximum December 31, 2025. The daily hire is based on a revised premium over the BCI, while all other main terms of the time charter remain materially the same.
M/V Gloriuship – Time-charter trip
In July 2024, it was agreed that the M/V Gloriuship will commence a new time charter trip at a gross daily hire of $22,500 for a period of about 70-80 days, after the expiration of her current time charter trip expected within August 2024.
Sale of M/V Oasea
In May 2024, the Company entered into an agreement with an unaffiliated third party for the sale of the M/V Oasea. The vessel was delivered to her new owners on July 19, 2024. The vessel’s gross sale price was $20.2 million, and the accounting profit is estimated at $1.5 million that will be recognized in Q3 2024.
Financing Updates
Sale and Leaseback of M/V Synthesea
In August 2024, the Company entered into a $18.0 million sale and leaseback agreement with an unaffiliated third party in Japan, to finance the exercise of the $17.1 million purchase option of the M/V Synthesea under its previous bareboat charter. The financing bears an interest rate of 2.70% plus 3-month Term SOFR. The charterhire principal amortizes over a seven-year term, through eighty-four consecutive monthly installments of approximately $0.1 million. The Company has continuous options to repurchase the vessel at predetermined prices, following the second anniversary of the bareboat charter. At the end of the bareboat period, United will have the option to purchase the vessel for about $6.5 million, which the Company expects to exercise.
Loan Facility of M/V Chrisea
In August 2024, the Company entered into a $16.5 million loan facility with a prominent lender in Taiwan, to finance the exercise of the $12.4 million purchase option of M/V Chrisea under its current bareboat charter. The principal will amortize over a five-year term, through twenty consecutive quarterly installments of $0.4 million and a final balloon payment of $8.5 million. The interest rate will be 2.60% plus 3-month Term SOFR.
Conference Call:
The Company’s senior management will host a conference call to discuss the financial results today, Tuesday, August 6, 2024 at 12:00 p.m. Eastern Time.
Audio Webcast:
There will be a live, and then archived, webcast of the conference call through the Company’s website. To listen to the archived audio file, visit the “Investors” section of our website. Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast, following this link.
Conference Call Details:
Participants have the option to register for the call using the following link. You can use any number from the list or add your phone number and let the system call you right away.
