Star Bulk Carriers Corp.

Thank you for standing by, ladies and gentlemen, and welcome to the Star-Bulls Harriers Conference call on the fourth quarter 2022 financial results. We have with us Mr. Petros Papas, Chief Executive Officer, Mr. Hamish Norton, President, Mr. Simo Spirou, and Mr. Christos Beglaris, Co-Chief Financial Officers, Mr. Nikos Leskos, Chief Operating Officer, and Mrs. Charis Plakantonaki, Chief Strategic Officer 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 would like that, please press star one on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today. We will now pass the floor to one of our speakers for today. Mr. Spiro, please go ahead, sir.

This is Christos Begleris. Thank you, operator. I am co-chief financial officer of Starbell Carriers, and I would like to welcome you to our conference call regarding our financial results for the fourth quarter of 2022. 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 Q4 results, cash evolution during the quarter, an overview of our balance sheet, an update on the banker benefit and vessels operations, the latest on the ESG front, and our views on industry fundamentals before opening up for questions. Let us now turn to slide number three of the presentation for a summary of our fourth quarter 2022 highlights. Net income for the quarter amounted to 86 million, an adjusted net income of 93 million, or 84 cents per share adjusted earnings per share. Adjusted EBITDA was 135 million for the quarter. For the fourth quarter, as per our existing dividend policy, we declared a dividend per share of 60 cents, payable on or about March 14, 2023. The graph on the bottom of the page highlights the cumulative performance over the last 12 months, which illustrates the strength of the platform in a robust drive-up market. Our last 12 months adjusted EBITDA is $809 million, and adjusted net income is $609 million U.S. dollars. Over the same period, we have returned a cumulative dividend of $5.1 per share or $526 million to our shareholders. Since 2021, we have declared a total dividend of $9.35 per share or $961 million. On the top right of the page, you will see our daily figures per vessel for the quarter. Our time charter equivalent rate was 19,590 per vessel per day. Our combined daily OPEX and net cost GNA expenses per vessel per day amounted to 5,182. Therefore, our TCE less OPEX and GNA is approximately $14,400 per day. Slide 4 graphically illustrates the cash flow bridge for Q4. We started the quarter with $393 million in cash and generated positive cash flow for operating activities of $116 million, after including debt proceeds and repayments, capex payments for energy-saving devices and balanced water treatment system installments, and a third-quarter dividend payment, we arrived at a cash balance of $286 million at the end of the quarter. For the calculation of our dividend distribution, we add back the debt repayment of $44 million that we drew on January 2023 to end at an adjusted balance of $331 million. Please turn to slide five, where we highlight the strength of our balance sheet. Our pro forma total liquidity today stands at 356 million. Meanwhile, our total debt stands at 1.32 billion. Since 2022, we have completed refinancings totaling 430 million that reduced our interest costs by approximately 5.2 million per year as a result of achieving significantly lower margins. Our next 12-month amortization is 186 million. We have 13 unlevered vessels with market value of $176 million and no debt maturities until 2024. In an increasing interest rate environment, we have interest rate swaps with an outstanding notional of approximately $722 million fixed at an average rate of 46 basis points for an average remaining maturity of 1.1 years. As of December 31st, 2022, the mark-to-market value of these swaps was 33 million. I will now pass the floor to our COO, Nikos Reskos, for an update on our operational performance. Thank you, Christos.

In slide six. Our 120 scrubber-fitted vessels have surpassed 131,000 operating days with an average system availability of 99.5%. With the current high fire spread at healthy levels, our scrubbers meaningfully contribute to our profitability. The highest fire fuel spread and $274 per ton for the full year of 2022. For administrative purposes, on the top right of the slide, we present a sensitivity table that shows the impact that micro-benefits can have on our bottom line based on consumption of approximately 700,000 tons of HSF water running for our scrubber-fitted vessels. Please turn to slide 7, where we provide an operational update. OPEX, excluding non-recurring for Q4 2022. Netcast GMA expenses were $977 per vessel per day for the same period. During Council 2022, Stavros assumed management of an additional 19 vessels from third-party managers, streamlining ship management operations and costs further. In addition, we continue to rate at the top amongst our listed peers in terms of ride ship safety score. Turning to slide 8, we provide a fleet snapshot and some guidance around our future dry bulk and vessel upgrade expenses and the relevant total of hire days. We have completed our balanced water installation program across the fleet, and in line with EXI and CNA regulations, we'll continue investing in upgrading our fleet further Our expected driver expense for Canada 2023 is estimated at $27.8 million for the dry docking of 31 vessels, with another $41.1 million towards our vessels' upgrade cap. In total, we expect to have approximately 870 days of hire for the same period. The above numbers are based on current estimates around dry dock and air traffic planning, vessel employment, and yard capacity. I will now pass the floor for an update on our ESG efforts.