EuroDry Ltd.

Thank you for standing by, ladies and gentlemen, and welcome to the Eurodry conference call on the third quarter 2021 financial results. We have with us today Mr. Aristides Pitas, Chairman and Chief Executive Officer, and Mr. Tasos Haslidis, Chief Financial Officer of the company. At this time, all participants are in listen-only mode. There will be a presentation followed by a question and answer session, at which time, if you wish to ask a question, you will need to press star and 1 on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today, Please be reminded that the company announced its results with a press release that has been publicly distributed. Before passing the floor to Mr. Pitas, I would like to remind everyone that in today's presentation and conference call, Eurodry will be making forward-looking statements. These statements are within the meaning of the Federal Securities Laws. Matters discussed may be forward-looking statements which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realised. I kindly draw your attention to slide two of the webcast presentation, which has the full forward-looking statement, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. I would now like to pass the floor over to Mr. Pitas. Thank you, sir. Please go ahead.

Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with him, he started as a financial officer. The purpose of today's call is to discuss our financial results for the third quarter, the nine-month period ended September 30th of 2021. Please turn to slide three. Our income statement highlights are shown here. For the third quarter of 2021, we reported total net revenues of $19.5 million, the net income of $11.8 million. Adjusted net income attributable to common shareholders was $10.1 million, or $3.77 per share diluted. Adjusted EBITDA for the quarter exceeded $30 million. For the nine-month period, our net revenues were $42.1 million, and our adjusted net income, $18 million, or $7.29 per share diluted. These results are in stark contrast to our poor results of last year, when the initial impact of the pandemic was first felt in our business. Our CFO, Dr. Seth Levy, will go over our financial highlights in more detail later on in the presentation. Please turn to slide four for our operational highlights. As previously announced on December 22, 2021, The company acquired Motivation Good Heart, a $63,214 built Ultramax vessel, for $34.5 million. The vessel was financed partly by own funds and partly by a bank loan of $22 million, collateralized by this new acquisition and our Motivation Starlight. There were no dry dockings or major repairs during the third quarter of 2021. To assist us in acquiring the GitHub, the company raised $9.2 million of net proceeds by issuing about 316,000 shares through our APM up to September 30, 2021. In the chartering grant, Our motivational election was fixed for a trip of about 80 to 90 days at $25,250 per day for the first 65 days and $31,000 per day thereafter. Following the delivery of motivational good hearts, it was fixed for the first period of approximately 40 to 50 days at $32,750 per day for the first 47 days and $42,000 per day thereafter. After the conclusion of this employment, she was fixed for a small 16 to 18-day trip at $33,000 a day. The MD Pangellis is fixed for a trip of a time charter of about five to seven months at $30,250 per day. And the end-week cash flow is fixed for a trip of about $80 to $90 a day at $28,500 per day. And lastly, Motivated Starlight was extended at 98.5% of the BPI index for a minimum period until October 2022. During the third quarter of 2021, the company settled the 90 days of pre-weekly sold forward freight agreements, the equivalent of one panel of expenses, which was originally sold at a rate of $3,550 per day with a loss of $1.7 billion. In October, we sold the 90 days in Q1 2022 of FFA's, the equivalent of one panel of expenses, at $31,500 per day. And a few days later, it closed that position at $23,200 per day, realizing a gain of about $700,000. As of September 30th, the remaining 90 days previously sold at $12,550 per day for Q4 2021 had a negative valuation of about $2.7 million. Last year for me was a very profitable quarter, although we decided during the 3rd of November meeting to redeem EVQ for all its outstanding C and B preferred shares, using approximately $13.6 million from its free pass. Thus, going forward, the company's balance sheet will be very simple, consisting only of trade equity and chief bank debt, which currently runs at a spread of about 2.3% above LIBOR. On nearly half of these, we have applied LIBOR hedge at about 1%. Please turn to slide 5 for the summary of Github's current view. With the acquisition of motorbikes in Goodfath, River Drive's fleet has increased to nine units, further complementing our cluster of home-built new building vessels. Along with our medium-age Japanese-built Tarmac cluster, our current fleet has an average age of 4.4 years, and the current carrying capacity is about 670,000 WT. Slide 6. shows the current weekly employment schedule. As you can see, the effective coverage for the fourth quarter of 2021 stands at about 56% in terms of minimum increased rate contracts, and about 10% only in 2022. This figure, of course, excludes ships on index charters that have secured employment, but are open to market movements. One can easily conclude that our performance will depend a lot on the market developments during the ensuing months. We feel happy with our current positioning of forward coverage, as we remain optimistic about the market fundamentals, as I will discuss a bit further down the presentation. Now let's turn to slide seven, where we go over the market highlights for the quarter ended in September 30th, 2021. During the third quarter, dry bank rates continued to climb throughout September, but reversed quite strongly in October. As seen here, the average spot market rate for Panamax ships was $31,700 a day in the third quarter, and by September 30th, the price had increased to around $34,100 per day. Meanwhile, The average one-year time-charter rate for Paramaxis was $57,230 per day in Q3, reaching $39,250 by the last day of the quarter. By last week, though, one-year time-charter rates had dropped to around $21,500 per day. According to Klaxons, during Q3,

You are now reconnected. Hello. Excuse us.

We were cut off. We are continuing from where we were cut off. We were at slide seven. We were going over the market highlights for this quarter. we had reached the point to say that after a strong Q3, we have seen in the last month a significant drop in the charcoal market, where Panamax vessels had dropped to about $21,500 per day. On the second-hand market, according to Clarkson, during Q3, second-hand bulk carrier prices increased by 17%. while new building prices increased to more than 37 and 34 million for cancer and ultra-match vessels respectively. And here today, the fleet has grown by 3.4%.

Please now turn to slide nine.

Global recovery continues on Baker this weekend compared to IMF's previous forecast in July. According to the October IMF report, growth forecasts have been revised slightly downwards, holding global growth projections for 2021 at 5.9% compared to 6% in July, while 2022 has been kept unchanged at 4.9%. Beyond 2022, the IMF continues to forecast a moderate global growth level of 3.3%. For 2021, this modest headline revision reflects more difficult near-term prospects for the advanced economy group due to supply disruptions fueled by higher commodity prices as inflation expectations continue. Prospects for emerging markets and developing economies have also been marked down for 2021, especially for emerging Asia. Particularly, the U.S. is expected to grow 6% for 2021, which is below its July quarter of 7%. The downward revision reflects a slowdown in economic activity resulting from the rise in COVID-19 cases and delayed production caused by supply shortages and the resulting acceleration of inflation. China's expense economy is expected to grow 8% in 2021, slightly less than the July forecast due to scaling back of public spending and the difficulties we see with the energy issues. While India's growth forecast are still retained at 9.5% for the review of 2021. Looking at the dry bulk trade growth, and based on Clarkson's projections for 2021, we see demand growth expectations continue to be on an upward trajectory of 4.6% for this year. For 2022 and 2023, the dry bulk trade is expected by Clarkson's to grow at a moderate pace, of 2.3% and 2.5% respectively. Please turn to slide 10. The order book as a percentage of total fleet up until November 21 stands at 6.8%, which is still around the lowest levels we've seen in the last 25 plus years. In the current order book and continuing demand range for the coming years, We expect a fundamentally supportive and continued rebound in the dry bulk market for the next couple of years at least. Please turn to slide 11 for our dry bulk fleet overview. According to Clarkson's, net fleet growth is projected to 2.6% in 2021. Based on the current level of the overview, flip growth will be at historical low levels in 2021 and 2022. Demolition in 2021 and 2022 is expected to be more or less on par with this year's very low level, as the effects from higher trade and fairly low banker prices limit the incentives for scrapping all very efficient dollars. Importantly, the 2023 order book is increasingly set and the news is unlikely to again be half of normal levels. So please turn to slide 12, where we summarize our outlook on the drive-by market. Global recovery continues, as we said before, at a solid pace, despite the ease of transferability of the Delta variant of COVID-19, and despite the backdrop of significant commodity and energy crisis increases, which have started to reduce the pace of economic growth and threaten the creation of an inflationary environment. The dryback market has been on a strong trajectory on the back of highly supportive conditions in the commodity markets, having reached 11-year highs in Q3 2021. In the last month, we have seen a slowdown in growth and especially of steam demand in China, which has affected the whole market. This has to do mainly with the logistical issues in our view due to the pandemic, but we feel the Chinese government has the power and the means to stabilize, and therefore we expect earnings to remain volatile at high levels at the short and medium-term outlook. And the short and medium-term outlook is generally positive and supported by one of the lowest order book servers. Furthermore, ordering of new ships in the future for 2023 deliveries is expected to be minimal due to lack of available slots in shipyards. In addition, the lack of clarity for the fuel of the future, as not knowing the optimal ship for even five days out makes the creation of any new order an uncertain proposition. Overall, a steady recovery in dry bulk volumes alongside limited supply growth and positive global economic sentiment should translate to firm improvements into 2022 and rightly beyond. However, market conditions could remain volatile as the number of risks remain around iron ore and coal trade and the eventual course of the COVID pandemic. Projection in this timing and the implementation of the new IMO environmental regulations from January 2023 onwards will be key elements in the direction of the market. Interesting times, as always, in the head. Let's turn to slide 14. The left side of the slide shows the evolution of one-year time charter rates of Panamax dry bulk vessels since 2002. As of November 5, the one-year time charter rate for Panamax is with capacity of 75,000 bbhs to get around $21,500. Still a very firm and profitable level despite the current 30% correction. As you can see on the right-hand side of the slide, the current price of the 10-year-old Panama Express is around 25 million. Over the past year, driving prices have gradually been increasing, exceeding the historical median and average levels, but still significantly lower than prices seen in 2010. In this environment, we are, of course, capitalizing on the strong markets by posting significant earnings and then really strengthening their balances. As the liquidity increases significantly from next quarter onwards, we are evaluating how best to use it for the benefit of our shareholders. This can be in the form of further debt reduction, share buybacks, and institution of dividends, or even acquisitions secured by strong charters which would bring residual risks down to a minimum of a conclusion. Most probably, it would be a combination of some of the above. We remain positive and excited about the prospects of Zero Drought within its framework and continue to evaluate opportunities for investment or any other form of cooperation exploiting our public lifting and operating platforms. Let me now pass the floor over to our CFO, Tasso Sassouidis, to go over our value financial highlights in more detail. Thank you, Tasso.

Thank you, Aristides. Thank you very much. Good morning for me as well, ladies and gentlemen. I will now take you through our financial highlights for the third quarter, a nine-month period, ended on September 30, 2021. and compared to the same period of last year. For that, let's turn to slide 15. For the whole quarter of 2021, the company reported total net revenue of 19.5 million, representing an 186% increase of a total net revenue of 6.8 million during the whole quarter of 2020, and that engaged primarily the results of the higher time to operate our vessels in the third quarter of this year as compared to the third quarter of last year, but also on the increased number of vessels we operated during this quarter. The company reported a net income for the period of 12.1 million and a net income attributable to common shareholders of 11.8 million as compared to a net income of 0.5 million the net income attributable to common shareholders of 0.1 million for the same period for the third quarter of 2020. Interest and other financial costs for the third quarter of 2021 remain roughly unchanged compared to last year at 0.6 million, since the increase in the average outstanding deficit decay during the period was offset by the decreased LIBOR rates for our loans. Adjusted EBITDA for the third quarter of 2021 was 13 million, compared to 2.8 million during the third quarter of 2020, representing a 362% increase. Basic earnings per share attributable to common shareholders for the third quarter of 2021 were $4.47, calculated on 2.6 million basic shares outstanding, And diluted earnings were $4.39, calculated on approximately 2.7 million diluted worth of average number of shares outstanding, compared to basic diluted earnings per share of $0.06 for the third quarter of 2020, calculated on approximately 2.3 million shares basic and diluted. Excluding the effect on the income attributable to common shareholders for the quarter of the unrealized gain in derivatives, the adjusted earnings attributable to common shareholders for the quarter ended September 30, 2021, which have been $3.84 per share, basic, and $3.77 diluted, respectively. compared to adjusted earnings per share of $0.05 base diluted for the third quarter of 2020. Usually, security analysts do not include the above item in their published estimates of earnings per share. Let's now move on the second half of the slide to discuss the nine-month results of the year. For the first nine months of 2021, the company reported total net revenues of 42.1 million, representing a 165% increase over total net revenues of 15.9 million during the first nine months of 2020, which again was the result of the increased number of vessels reoperated and the higher average charter rates of vessels earned during the nine-month period compared to the same period of last year. We reported a net income for the period of 15.1 million and a net income attributable to common shareholders of 14.2 million. Let's convert to a net loss of 5.6 million and a net loss attributable to common shareholders of 6.7 million during the first nine months of 2020. In case another financing cost for the nine-month period of 2021 amounted to 1.7 million, compared to 1.9 million for the same period of 2020. This decrease is mainly due to the decreased labor rates or low insurance in the current year compared to the last. Also, in 2021, we recorded a non-cash expense of about 1.7 million as a loss on debt extinguishment upon the conversion of certain of our debts into equity. Adjustability done for the nine months of 2021 was $26.3 million, compared to $1.8 million achieved during the first nine months of 2020, representing a 1,326% increase. Basic earnings per share, attributable to common shareholders for the first nine months of this year, were $5.84, calculated from approximately 2.4 million shares outstanding, And diluted earnings per share were $5.73, calculated on approximately 2.5 million weighted average numbers of shares outstanding, compared to basically diluted loss per share of $2.97 for the first nine months of 2020. Again, excluding the effects on the income attributable to common shareholders for the nine months of the unrealized loss on derivatives, and the loss on debt extinguishing for last year's results. The adjusted earnings per share attributable to common shareholders for the first nine months of this year would have been $7.42 basic and $7.29 diluted, respectively, compared to a loss of $2.7 per share based diluted for the same period of 2020. Again, as previously mentioned, usually secure panels do not include the unrealized and extraordinary items in the published MetroCard inspection. Let's now turn to slide 16 to review our CLIP performance. We will start our review by looking at our utilization rates for the third quarter of 2021 and compare it to the same period of 2020. As usual, our utilization rate is breaking down into commercial and operational. During the third quarter of this year, our commercial utilization rate was 100%, while our operational utilization rate was 99.4%, compared to 100% commercial and 98.9% operational for last year. An average of 8.1 vessels were owned and operated during the third quarter of 2021, earning another contractual equivalent rate of $28,103 per vessel per day, compared to seven vessels that we own and operate in the same period of 2020, earning an average of $11,822 per day. Our total daily vessel operating expenses, including management fees, general and mutual expenses, but excluding driver-to-court, averaged about $6,495 per vessel per day during the third quarter of 2021, compared to $6,597 per vessel per day for the third quarter of last year. If we move further down in this table, we can see the cash flow break-even rate that we set during the third quarter of this year. Defection to account also, drag out in expenses, cut filter expenses, loan repayment, and our preferred dividend payment is paid in cash. Thus, for the third quarter of 2021, our daily cash flow break-even rate was about $9,991 per day, compared to $9,974 per day for the comparable year, the third quarter of 2020. Let's now look on the right part of this slide to review our nine-month figures. During the nine-month period of 2021, the first nine months, our conventional depletion rate was 100%, and our operational depletion rate was 99.6%, similar to the levels for the same period of last year. The average of 7.49 vessels were owned and operated during the first nine months of 2020, earning an average time chart rate equivalent of $22,232 per vessel per day, compared to $7 that we own and operate in the same period of 2020, earning an average time chart equivalent rate of $8,927 per day. Our total daily operation expenses, again, including management fees, G&A, expenses, but excluding driving costs for the nine-month period ending September 30th of this year amounted to $6,510 per person per day compared to $6,195 per person per day for the same period of 2020. Let us look again at the bottom of this table to see our cash flow break-even level for the nine-month period. which amounted to $10,451 per vessel per day this year compared to $11,209 for the same period, the first nine months of 2010. Let's move now to slide 17. We could use this slide for the last two earnings calls to provide our shareholders and investors a tool to assess the earning potential of our fleet over the next two to three quarters. The table shown in this slide has two components. The top part refers to our fixed-rate contracts. It is not working because more percentage of our available days is under fixed-rate contracts, especially in the first or second quarter of 2022. We consider this fortuitous as the market is performing very well, despite nutrition drop, as I previously mentioned, is being expected to produce significant earnings for us. The rest of our veterans are employed in contracts linked to the relevant to their size Baltic Dry Index. Our calculator indicatively shows the Supramax and Panamax Baltic Forward Rates as of November 10, 2021, at the bottom part of the table. It also shows how these index levels get translated to age for our ships. We actually display on the table the final blended rate for the open days of our fleet, which you can see right below the supermax eponymous forward rate in the table, in which, as you can see, turns out to be very similar to the index levels. Based on these assumptions, and by further assuming for simplicity $6,500 per vessel per day operating expenses and GMA costs, and the 5% commission rate, one can estimate the contribution to our EBITDA. The final result for the fourth quarter of 2021 is additionally adapted for an FHA contract for 90 days for the quarter that we have. This overall exercise is meant to provide, as I mentioned in the previous course, a tool to calculate how it will be done for the upcoming quarters, in this case here for the fourth quarter of 2021 and the first half of 2022. Obviously, one can make his own assumptions about the rates to do that calculation. It is worth observing that based on yesterday's SFA rates, which are approximately equal to the present rate that our fleet is earning. SRTs mentioned are 30% lower than what they were two weeks ago. We expect manualized EBITDA contribution for 2022 that is above that of 2021. Let's now move to slide 18 to review our debt repayment profile. On the top part of the slide, we see our loan and balloon payments, or called bond debt. It's September 30th, 2021, with an outstanding debt of about $73.9 million. By looking at the chart, we can see that over the next three years, we have another annual repayment rate of about $12 million a year, which translates to about $1.2 million per vessel for roughly about $4,000 per vessel per day. Our next balloon payment is in 2023 for about $11.3 million, and that refers to one of our giant vessels, the Caterini, which by the time will be five years old, and the balloon we expect to be able to finance as a matter of course as we have done in the previous occasions. A quick note here on the cost of funding. The average margin of our debt, as you can see from the column on the right part, not on the right part of the slide, is about 2.8%. Assuming a library of about 0.3% on the top of it, we can estimate the cost of our senior debt to be a little more than 3%, 3.1% or so. Regarding our preferred entity, as I previously mentioned, our board of directors decided in November to reduce some of the earnings we accrued to redeem all of our authentic Series B preferred shares, as part, and thus reduce our funding costs. This redemption will increase the earnings per share of our common shareholders by $0.28 in 2022, and by about At the bottom of this slide, you can also see a projection of our cash flow break-even level over the next 12 months, as well as a breakdown of it, which is expected to be around $12,678 per vessel per day. Taking our move to slide 19, where we can see some highlights from our balances. This slide gives you a snapshot of our assets and liabilities in a simplified way. On our asset side, first, we can see that we kept cash and other assets as of September 30th, 2021, of about 26.1 million. Again, on our asset side, the book value of our vessels is 130.6 million, bringing the total book value of our assets to 156.7 million. On the liability side, our debt as of September 30, 2021, stood at 73.9 million, which approximately represents 47% of the book value of our assets. Our preferred equity as of September 30 stood at 13.6 million, which accounts for another 18.6% of our assets, while our remaining liabilities approximately were 7.5 million, or roughly 4.8% of our book assets. That leaves us with a net book value of 61.7 million, which translates to $22.3 per share. However, the market value for our fleet is significantly higher than its book value, and we need to make certain adjustments to get a better estimate of the value of the company. We estimated that as of the end of September 2021, the market value of our nine vessels was 50% higher than their respective book values, suggesting an NAD per share of around $47. And although our share price has recently increased, or traded at the range of between $25 and $32 per share, it's still significantly below that level, and therefore investing into our company represents an opportunity with significant upside potential. And with that, I would like to turn the floor back to our students to continue the call.

Hello. Let me open up the floor now for any questions and answers you may have, any questions you may have.

Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star 1 on your telephone keypad and wait for the automated message advising your line is open. Please state your first and last name before you ask your question. If you wish to cancel your request, please press star 2. We will now take our first question. Please go ahead. Your line is now open.

Hello, all.

Hello. This is Tate Sullivan from Maxim Group. Just a little macro to start. I mean, it seems like shares for a lot of the dry bulk companies are following what the indices have done recently coming down from peaks. And your comments earlier about steel demand in China flagging recently, but I've heard various comments from dry bulk companies on that. Can you give a little more about how that might be just a temporary factor and the seasonal considerations as well, please?

Sure.

the levels of iron ore inventories of steel in China have been significantly depleted. So the prices have also dropped. China is very very decideful itself when they buy and sell iron ore. So I think that when they realize that the prices are low enough and they want to move their economy, they have the capacity to start ordering iron ore again. We've seen that happen time and time again. And when they do that, we will see again a significant increase in the volumes of iron ore that will be shipped. So I think that, and you've seen it in the case size vessels freight rate, how they vary over the year from,

for these kinds of movements.

Great. Thank you. And I apologize if it broke up a little bit there. But I see how when it has happened time and time again in previous cycles, is it usually a timeline that is about four to five months? The rates, the forward rates seem to be making that in for the first six months of 2020-2022.

Yes, you will break it up a little bit, but yeah, if these elevated rates again within the first part of 2022, definitely we think we will. I mean, it might happen.

Thank you. Thank you. And Tassos, on the preferred equity redemption issue, a great move and lower cost of funding as well. Can you just refresh on the accounting for that in 4Q, redeeming those at par at 13.6 versus the last carrying value of 13.1? Will that be a loss in 4Q? And can you just, what's the conversion price on that preferred equity?

Go ahead. I would think the first share that we had there initiated seven years ago, gave the company the option after five years to redeem them. And given the fact that we pay 8% for that piece of funding, which will become 14% in 14 months, we decided that it was a good use of our earnings to stay down to redeem the whole amount of the preferred equity and keep the dividends returning to our shareholders.

Great. Okay. Thank you both.

Thank you.

We will now move to questions.

If there's anyone speaking now, we cannot hear. Please go ahead. Your line is now open.

Hi. Can you hear me?

Yes, we can do that.

Okay. I hate to do this, Tasos, but you broke up a lot on your last answer. So can you highlight, you know, what you're going to redeem, how much cash you're going to use to redeem the preferred in this quarter?

I think we're going to use 13.6 million, which is exactly the outstanding amount of preferred equity. And so we will pay that plus any accrued dividends. I believe by the time we're going to do the retain, the redemption, it will be something like $400,000 accrued dividends, the majority of which is already in our results for Q3. So we will pay them that. So I estimate that there will be about $14 million of cash needed to repay the shares at par plus the accrued dividends.

Okay. And then can you, it looks like you traded, you know, the first quarter 2022 FFA market. Can you just highlight whether, you know, your thoughts behind that and whether you expect to put any FFAs in place for the first half of the year or even, you know, the full year for 2022? Sure.

don't use FSAs speculatively. We only use FSAs to hedge our position. So because we had all our chips in the spot market, rather than fixing a time charter, we decided to fix at the beginning of October a FFA contract for Q1, essentially covering one vessel for Q1 at the level which was 31,000 something, which we deemed very satisfactory at the time. So it was done as a head against one of our open vessels. As the market moved down, We felt the move was very abrupt, and we thought that it would correct sooner than what it has proven to have been correcting. So we closed that position at that point, took the profit of $700,000. and essentially had again our ship open and exposed in Q1 this coming year. You will never see us doing the opposite. You will never see us buying FFAs when we have ships that are open in the market because that would increase our exposure in the market, which we don't want to do. We only want to use FFAs to cover our position And, of course, if at some point we think that we are over covered, we might close some positions to reduce the cover or take some profit.

Okay. And has the FFA market moved back up to where you would be potentially looking at selling again and creating solutions? cover or some hedges for the first half of the year?

It hasn't moved up that much yet. It's around the level that we closed our position, maybe even a little bit lower than the level that we closed our position at this point. So it's not at 30,000. It's, again, at around low 20s, very low 20s. So this is not a level that we think that we would like to take additional cover. We do believe in the market and that we should see higher rates happening and conspiring. So we are not ready to fix our vessels out at $20,000 level. Yeah, I see the... Sorry. Yeah, we'd rather keep them a little bit, we'd rather keep them spot. If we do see them approaching $30,000 again, we will take some additional cover though, either by fixing them on time charter or through FFA, we'll see.

Yeah, maybe today is a pretty abrupt day, but I see the FFA for Panamax is down in the first quarter, down under $30,000. you know, under 20 or closer than 19. That's helpful. Tassos, can you talk about the dry docking activity? It looks like dry docking expenses are, you know, going up for the next 12 months, and they potentially total close to $4 million. Can you just highlight how much downtime or idle days would be associated with those dry docks?

Yeah, I don't have in front of me the exact dry-dolting schedule of the vessels. The first nine months of the year, we take very little dry-dolting, almost no dry-dolting, I think. That's why we show a significant drop in the dry-dolting expenses. I believe we might have one or two dry-doltings next year. I'll be happy to provide you. Typically, it takes about 20 days. We budget 20, 25 days. for the off-market, for the dry dock. And if it's a young, one of our younger vintage, we budget between $500 and $700, $1,000 per dry dock, and a little closer to $1 million for our Panamax. So I can get a little more specific offline if you want, but that's what I recall on top of my head.

Yeah, that'd be helpful. And then, Aristides, can you talk about the, you know, S&P market and just what you're seeing there and sort of your stance right now on, you know, additional moves to either enhance the fleet or expand the fleet?

Well, I think we need to trust that

seeing how things settle down after this vibrant move in the market. I mean, the very strong improvement in charter rates that we saw in September and the subsequent drop in October and how that affects values. And If we do see the market correcting as far as values are concerned, we haven't seen that yet, and it doesn't really happen unless the market is low for quite some time or relatively low for quite some time. So we want to see how things develop first before we decide on a particular move. in acquiring maybe another ship or even selling an older one and replacing it with a younger one, which is something that is also a thought that we have had, but we are not ready to implement any of these options at this point. We are more on a wait-and-see situation at this current moment.

Great, that's helpful, and I'd be remiss if I didn't say it looks like the Eurostase acquisition this morning looks pretty interesting.

Congratulations on that.

Yes.

Yes, that's a very good move, but that's a different company.

Okay.

Yep.

No, exactly. But thank you so much.

Thank you very much. Thank you. Thank you.

We have no further questions. I will now hand back to Mr. Peter for closing remarks.

Thank you, everybody, for participating in today's call, and we'll be back with you next year with the end-of-the-year results, which we all know will be great, and we'll take it from there. Let's see what 2022 will bring. Bye-bye.

Thank you. That concludes the conference for today. Thank you for participating.