Star Bulk in Debt Refinancing Drive

  • Business & Finance

In line with its decision to make debt repayment a priority, Greek dry bulk carrier Star Bulk Carriers has received two separate commitments from banks for refinancing of loan facilities worth over USD 200 million.

Specifically, on January 8, 2018, the company received a committed term sheet from an undisclosed bank for the refinancing of the Commerzbank USD 120 million facility, which currently has an outstanding balance of USD 34.7 million.

Furthermore, on February 13, 2018, Star Bulk received a committed from ABN AMRO N.V for the refinancing of the ABN AMRO USD 87.5 million loan, which has an outstanding balance of USD 27.5 million.

Both refinancing arrangements are yet to be finalized, with expected refinancing set to take place in April and December 2018 respectively.

“Having terminated the amortization holiday under our restructuring agreements 6 months ahead of schedule, we repaid USD 35.6 million in February 2018 through our cash sweep mechanism, and hope to fully pay down the deferred amounts by the end of this year,” Petros Pappas, Chief Executive Officer of Star Bulk, commented.

The refinancing push is taking place as Star Bulk reports net income for the fourth quarter of 2017 of USD 23.9 million, against a loss of  USD 33.1 million booked in the same quarter a year earlier.

“I am very pleased that Star Bulk returned to profitability after three challenging years, reporting USD 90 million in TCE revenues, USD 55.7 million in adjusted EBITDA and USD 21.5 million in net income for the quarter ended December 31, 2017.

“This performance is underpinned by an average TCE of USD 13,860/day per vessel with 100 pct fleet utilization, and average Opex and Net Cash G&A expenses per vessel of USD 3,850/day and USD 1,094/day respectively. We have fixed 86 pct of available ship days for Q1 2018 at average TCE rates of USD 12,700/day,” Pappas added.

“We continue to look for attractive consolidation opportunities and remain optimistic about the remainder of 2018.”

For the full year, the company shrunk its net loss to 9.8 million from USD 154.2 million recorded for 2016.

Since the start of the year, Star Bulk took delivery of one Newcastlemax vessel, Star Eleni, with carrying capacity of 207,810 deadweight tons. The vessel is financed under a bareboat charter in the amount of USD 30 million.

The company has two more Newcastlemaxes under construction at Shanghai Waigaoqiao Shipbuilding in China, slated for delivery in April 2018.

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