Star Bulk Carriers Corp.

Thank you for standing by, ladies and gentlemen, and welcome to the Starbuck Carrier Conference Call on the second quarter 2021 financial results. We have with us Mr. Petros Papas, Chief Executive Officer, Mr. Hamish Norton, President, Mr. Nikos Reskos, Chief Operating Officer, Mr. Simos Spirou and Mr. Christos Begleres, Co-Chief Financial Officers of the company. At this time, all participants are in a 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, please press star 1 on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today. We now pass the floor to one of your speakers, Mr. Christos Beglaris. Please go ahead, sir.

Thank you, operator. I'm Christos Beglaris, co-CFO of Starbuck, and I would like to welcome you to our conference call regarding our financial results for the second quarter of 2021. Before we begin, I kindly ask you to take a moment to read the safe harbor statement on slide number two of our presentation. In today's presentation, we will go through our second quarter results, our cash evolution during the quarter, an operational update, and the latest industry fundamentals before opening up for questions. Let us now turn to slide number three of the presentation, for a summary of our second quarter 2021 financial highlights. In the three months ending June 30th, 2021, TCE revenues amounted to 254.9 million compared to 97.1 million for the same period in 2020. Adjusted EBITDA for the second quarter 2021 was at 182.5 million versus $35.2 million in the second quarter 2020. Net income for the second quarter amounted to $124.2 million, or $1.22 earning per share, versus $44.1 million net loss, or $0.46 loss per share, in the second quarter of 2020. Our TCE rate during this quarter was at 22,927 per vessel per day. Total cash today stands at 280.3 million, with total debt at approximately 1.62 billion. In addition, we have the ability to use a 30 million revolving facility, which is currently undrawn. During the second quarter of 2021, we took delivery of one Ultramax and the two remaining Camsomax resales, reaching a total of 128 vessels on the water. As of June 30th, 2021, we owned 128 vessels, and our total cash balance for the financing proceeds of the two resale Camsomaxes was at $282.8 million, resulting in a declared dividend per share of $0.70 payable on or about September 8th. In slide 4, we show the significant annual interest cost savings of the company due to our refinancing efforts. Total existing facilities refinanced or committed to be refinanced amount to $333.7 million, with new secured senior facilities of $391.7 million. Using the excess proceeds, our daily bond of $50 million was redeemed. The average margin for the existing facilities to be financed is at 2.9%, while the average margin for the new secured facilities is at 2.1%. Finally, the interest rate cost savings for Starbucks is at $5.5 million, out of which 4.1% are the interest cost savings attributed to the retention of our baby bond, and $1.4 million are due to the refinancings of our secure facilities. Slide 5 graphically illustrates the changes in the company's cash balance during the second quarter. We started the quarter with $206.6 million in cash, generated positive cash flow from operating activities of $140.5 million due to the strong freight markets. After including debt proceeds and repayments, rental acquisitions, capex payments for scrubber and ballast water treatment system installments, as well as the dividend payments declared in the first quarter, we arrived at the cash balance of 242.8 million at the end of the second quarter. Please turn to slide six, where we summarize the evolution of net debt Since the beginning of the year, we have been able to reduce our net debt by more than $228 million due to strong cash flow from operations. In slide 7, we demonstrate the inherent operating leverage of the company to a rising freight market and the potential increase in EBITDA with any freight or fuel spread increases. with 46,500 fleet available days per year. An additional daily fleet-wide increase in DC by 2,000 per day will increase our EBITDA by 93 million. Similarly, assuming a total annual bunker consumption of 800,000 tons, an increase in the high-fi fuel spread by $25 per ton, will generate an additional limit of $20 million. I will now pass the floor to our COO, Nikos Reskos, for an update on our operational performance.

Nikos Reskos Thank you, Christo. Please turn to slide A, where we provide an operational update. OPEC, excluding non-recurring expenses, will per vessel per day for the first half of 2021. Despite continued adverse COVID-related restrictions, which have a direct impact on OPEX, the combination of our in-house management and the skill of the group enable us to maintain very competitive costs, with Starbucks continuing to rate at number one among our listed peers in terms of ride-ship rating. Since January 2020, Starbucks maintains a 99.6% scrubber system availability, across 120 vessels, with 60,000 operating days and more than 1.2 million tons of HSFO consumed. The company has made significant progress in analyzing carbon emissions across its fleet in view of IMO 2023 decarbonization roadmap. We believe that our vessel emission profile will remain competitive within the upcoming carbon intensity index framework, which is expected to be adopted by the IMO in 2023. Aiming to establish all required operational measures ahead of the regulation effective date, we're implementing voyage planning analysis, speed and health performance optimization practices, which will be adopted across our fleet as of January 2022. On the CapEx front, we're examining the long-term impact of various energy-saving devices and applications in maintaining a competitive carbon intensity rating across our fleet well beyond 2023. We are actively engaged with various R&D workshops and consortia in collaboration with other stakeholders, including engine makers, classification societies, fuel technology innovators, and carbon credit advisors in pursuit of technically and commercially viable solutions in reducing meaningfully our vessel's carbon emissions footprint. Turning to slide 9, we provide some guidance around our future dry dock and ballast water treatment system expense for the next 12 months and a relevant total of high days. The numbers are based on current estimates around dry dock and retrofit planning, vessel employment, and yacht capacity. These figures incorporate our current understanding of present and future shipyard congestion. Since the beginning of the year, 33 vessels have entered dry dock, and 13 have been retrofitted with palace water treatment systems, with a majority of our larger vessels scheduled for the year having completed their dry docks at least first quarter. Our expected driver expense for the next 12 months is estimated at $27.8 million for the dry docking of 30 vessels, with another $25.8 million towards our balance system, CAPEX. We expect to have 72% of our total fleet balance water fitted by end 2021, and 97% by end of 2022. In total, we expect to have approximately 825 off-yard days for the forward 12-month period. I will now pass the floor to our CEO, Petros Papas, for a market update and his closing remarks.