GENCO SHIPPING & TRADING LTD Q3 FY2024 earnings call

• Fleet Renewal: Furthered fleet growth and renewal strategy by acquiring a 2016-built Capesize vessel in October, part of a broader strategy. Exited four smaller older vessels and redeployed proceeds to acquire three 2016-built Capesize ships, resulting in dry dock CapEx savings of $13 million in 2024-2025. • Dividends: Declared a $0.40 per share dividend for Q3, a 18% quarter-over-quarter increase. Removed dry-docking CapEx from dividend calculation, increasing dividend by $0.27 per share. Have declared 21 consecutive dividends totaling $6.31 or 39% of current share price as of November 5. • TCE Performance: Q3 fleet wide TCE increased 59% year-over-year. Q4 65% of available days fixed at $18,786 per day, well above breakeven rate. • Debt Management: Paid down 82% of debt since end of 2020, totaling nearly $370 million, resulting in a pro forma net loan to value ratio of 5%. Voluntarily paid down $120 million of debt in 2024, reducing interest expense by ~$6 million annualized.

In Q3 2024, Genco's Capesize segment was prominent. The fleet wide TCE increased by 59% year-over-year. The Capesize vessels saw strong performance with a PCE Rate of $26,951 per day in Q3 2024, which was nearly $12,000 per day higher than the same period last year. Genco acquired a high-quality, fuel-efficient 2016-built Capesize vessel in October, its third Capesize acquisition in 12 months. The company exited four smaller older vessels earlier in the year and redeployed proceeds towards acquiring three 2016-built Capesize ships, resulting in dry dock CapEx savings of $13 million in 2024 and 2025. The Capesize segment contributed significantly to revenue, with the PCE Rate highlighting the operating leverage and upside potential of the sector.

• Dividend: Continue to provide sizable dividends, with recent enhancement to dividend policy allowing for larger distributions. • Fleet: Continue fleet renewal strategy, targeting acquisition of high-quality, fuel-efficient vessels. • Financial: On track to achieve net debt zero in the short term. • Q4 Outlook: 65% of available days fixed at $18,786 per day, indicating a strong quarter with TCE estimates at $18,786 per day for 65% fixed. Anticipate DVOE to decline in Q4 from Q3 levels.

• Trade Disruptions: Potential impact of tariffs and trade policies from the incoming Trump administration could have unintended consequences on ton miles, though goods generally find ways to move. • Market Volatility: Dry bulk market is cyclical and volatile, with recent rate pullbacks due to factors like China's stimulus impact and West African bauxite issues. • Geopolitical Uncertainty: Geopolitical events may disrupt global trade, potentially affecting ton miles and market conditions.

Q: How does the incoming Trump administration affect the DryBulk market?

A: John Wobensmith states there won't be substantial impact on ton miles generally, but tariffs and trade disruptions could have unintended consequences. Goods typically find ways to move, though may be less efficient. Could lead to Chinese increasing fiscal stimulus.

Q: What's the acquisition pipeline for Genco?

A: John Wobensmith says Genco is in fleet renewal mode, looking at high-quality, fuel-efficient vessels, with firm prices expected for eco Capesizes, likely to be firmer next year.

Q: Will Genco continue to maintain revolver for flexibility?

A: Peter Allen replies yes, with over $330 million undrawn revolver availability, providing plenty of liquidity for accretive growth opportunities.

Q: About Capesize contracts rolling off, plan for floating rate?

A: John Wobensmith says opportunistic, will continue to capitalize on index or fixed rate charters as opportunities present, picking spots and moving quickly when favorable percentages are available.