EuroDry Looking Into Merger Possibilities Post Spin-Off

Newly-established dry bulk owner and operator EuroDry, created via Euroseas’ spin-off of its dry bulk business, is exploring merger possibilities in the sector.

Aristides Pittas, Chairman and CEO of EuroDry, revealed in the company’s second quarter results that the Greek shipping company was looking into potential merger opportunities with other fleets in “accretive transactions”.

Pittas did not disclose any further details of the opportunities at hand. However, he added that aside to potential mergers the company was also evaluating vessel acquisitions.

“We believe it is still an opportune time to pursue growth either through individual vessel purchases or by consolidating with others who would like to become shareholders of a publicly listed drybulk company,” he said.

“We are optimistic about the prospects of the drybulk markets as the orderboook is close to its lowest levels of the last 20 years and new regulations coming in effect in the near future will likely keep the supply of vessels in check; this will allow increases in demand to positively influence earnings and values.”

For the second quarter of 2018, the company reported total net revenues of USD 6.1 million representing a 29.1% increase year-on-year. EuroDry reported net income for the period of USD 0.5 million for the period, as compared to a net loss USD 0.3 million for the same period of 2017.

On the other hand,  feeder owner and operator Euroseas reported net revenues of USD 9.8 million, and a net income of USD 2.1 million for the second quarter of the year.

According to Pittas, during the second quarter, the containership market continued its recovery.

“Although charter rates peaked in early May and have softened since, they remain at levels noticeably higher than their respective periods of last year. Expectations for continued economic growth across many developed and developing countries and low levels of orderbook support our guarded optimism that charter rates, especially for feeder vessels, will further improve in the latter part of the year and in 2019, provided that U.S. induced trade wars do not escalate significantly,” he said.

“Thus, we have been fixing our vessels that open up for recharter for periods between 3-12 months at profitable levels but also aiming to have staggered renewal periods to be able to participate further in the strengthening market which we anticipate.”

He added that the company is also considering investment opportunities of either individual vessels or fleets that could be accretive to the company’s shareholders.