Star Bulk Reports USD 105.2M Loss

Dry bulk shipping company Star Bulk has posted a net loss of USD 105.2 million for the first half of 2015 due to lower charterhire rates for dry bulk carriers and an impairment loss of USD 28.8 million.

The volatile market took the company’s loss further down in the second quarter to USD 65 million, resuming the losing streak from the first quarter of the year when Star Bulk had a net loss of USD 40.2 million amid historically low rates in the dry bulk market.

According to Petros Pappas, Chief Executive Officer of Star Bulk, the company’s Q2 bottom line has been affected by non-cash losses of USD 39.1 million related to the sale of four of on the-water vessels and one newbuilding vessel under construction, as well as the cancellation of one newbuilding vessel.

The company has disposed of a total of 12 vessels since December 2014, including ten vessels built during the 1990s, one modern Supramax vessel and one newbuilding vessel under construction.

“Following the completion of the above sales, we will have collected proceeds of USD 60.9 million after repayment of relevant debt facilities, “ Pappas said.

“As compared to the first half of the year, spot and period rates have been higher, especially for Capesize vessels. Commercially, we are striving to position our vessels in a flexible manner, so as to take advantage of this upswing in the market.

As far as the long term is concerned, we have seen encouraging steps on the supply side, with high scrapping rates during the first half of 2015, very low new orders and significant delivery slippage. On the demand side, Chinese iron ore import substitution and restocking, Brazilian iron ore production and export expansion, as well as a stabilization of Chinese coal imports, are expected to assist in driving a sustained recovery of the dry bulk trade demand over the next couple of years,” he continued.