Genco Swings to Profit as Charter Rates Rebound
The dry-bulk shipowner raised its quarterly dividend to a record $0.80 a share.
Dry-bulk shipowner Genco Shipping & Trading (GNK) swung to a second-quarter profit as stronger freight rates and a larger fleet lifted voyage revenue.
The quarter marked a reversal from the start of the year. Fleet-wide time charter equivalent rates climbed 25% sequentially to $24,273 a day after declining in the first quarter, and stood 78% above the year-earlier period.
Voyage revenue rose 69% from a year earlier to $136.4 million and increased 19% from the first quarter. Net income was $16.6 million, compared with a $6.8 million loss a year earlier, while adjusted net income reached $29.2 million from an adjusted loss of $6.2 million.
Major-bulk vessels drove the rate improvement. Capesize TCE nearly doubled to $33,483 a day, while the newly added Newcastlemax vessels generated $36,200 a day. Total ownership days increased as Genco added Newcastlemax and Capesize capacity and reduced its use of chartered-in vessels.
Adjusted EBITDA rose 57% sequentially to $56.7 million and nearly quadrupled from $14.3 million a year earlier. Reported EBITDA was $44.2 million after the quarter included $13.1 million of other operating expense and a $1.2 million vessel impairment.
Third-quarter fixtures averaged $28,587 a day for 66% of available owned-fleet days, 18% above the second-quarter realized rate and the highest level since the second quarter of 2022. The company projects a third-quarter dividend above $1 a share, more than 25% above the latest payout.
The company also expanded its fleet-renewal program with a 2019-built Capesize vessel expected in August, following two Newcastlemax deliveries in March. Genco drew $50 million in July toward the purchase and expects pro forma debt of $380 million, with $300 million of undrawn revolver capacity.