Seanergy Maritime Holdings Corp.

Thank you for standing by, ladies and gentlemen, and welcome to the Synergy Maritime Holdings Corp conference call on the third quarter and nine months ended September 30th, 2025 financial results. We have with us Mr. Stamatis Tsantanis, Chairman and CEO, and Mrs. Stavros Giftakis, Chief Financial Officer of Synergy Maritime Holdings Corp. At this time, all participants are in a listen-only mode. There will be a question and answer session, at which time, if you would like to ask a question, please press star 1 1 on your telephone keypad, and you will then hear an automated message advising that your hand is raised. Please be advised that this conference call is being recorded today, Thursday, November 13, 2025. The archive webcast of the conference call will soon be made available on the Synergy website, www.synergymaritime.com. To listen to the archive audio file, visit the Synergy website following the webcast and presentation section under the investor relations page. Many of the remarks today contain forward-looking statements based on current expectations. Actual results may differ materially from the results projected from those forward-looking statements. Additional information concerning factors that can cause the actual results to differ materially from those in the forward-looking statements is contained in the third quarter and nine months ended September 30th, 2025 earnings release, which is available on the Synergy website again, www.synergymaritime.com. I would now like to turn the conference over to one of your speakers today, the chairman and CEO of the company, Mr. Stamatis Santanis. Please go ahead, sir.

Thank you, operator, and welcome, everyone. Today, we're pleased to present another quarter of strong performance for Synergy, underlying our consistent profitability, disciplined strategy, and the continued success of our focused CAPE size and universal max platform. a model that we expect will deliver superior earnings capacity versus most peers. Following the strong momentum established in the second quarter, Synergy delivered a profitable third quarter driven by our large vessel exposure and the ongoing strength in the CAPE size market. Net revenue reached approximately $47 million, adjusted EBITDA was $27.5 million, and net income total $12.8 million, demonstrating synergies, superior earnings capacity, and operational leverage. Over the first nine months of the year, we generated net revenue of $108.7 million, adjusted EBITDA of $52.8 million, and net income was $8.8 million. In line with our dividend policy, we declared a cash dividend of 13 cents per share for the quarter, bringing total 2025 distributions to 23 cents per share and reaffirming our commitment to regular shareholder returns. The expiration of our Class E warrants removed legacy dilution and further simplified our capital structure, fully aligning long-term performance with shareholder value. With a fleet of 20 large Cape size vessels and Newcastle Maxxis and fleet loan value ratio around 45%, Synergy is very well positioned to benefit from a robust Cape size cycle. Moving on to fleet developments, we continued executing our disciplined fleet renewal strategy. In October, we placed our first ever new building order, a 181,000 deadweight cave size at Hengley Shipyard, marking the next phase of a large vessel strategy focused on efficiency, scale, and modernization. The vessel is priced at approximately $75 million with delivery scheduled for the second quarter of 2027, offering strategic delivery window ahead of most comparable projects. This decision reflects attractive new building economics versus surging secondhand values and position synergy to capture stronger long-term returns from a modern fuel-efficient fleet. The project's timing aligns with the expected upswing in iron ore and bauxite trade through 2027 and thereafter. In parallel, we sold and delivered the vintage capes I shipped for $21.6 million, releasing approximately 12 million in net liquidity and further optimizing our fleet composition. Our vessels continue to secure premium employment with top-tier charters, supported by index-linked charters that preserve full market exposure. This disciplined structure, complemented by selective FFA hedging, ensures resilience across cycles. Our time chatter equivalent has consistently outperformed the BCI, confirming the strength of our larger vessel commercial model and positioning us for sustained earnings momentum heading into 2026. To conclude the first part of this call, our focus on larger cage-sized and custom-axed vessels continues to differentiate Synergy. These assets deliver superior earnings capacity and long-term value compared to smaller bulk segments. Our boutique platform is built on scale where it matters, vessel size and operational performance, maximizing value creation per share. With a modern efficient fleet, prudent leverage and consistent dividends, Synergy remains very well positioned to lead in shareholder value among listed dry bulk companies. I will now pass the floor to Stavros to discuss our financial update, and I will conclude later with our comments on the market. Stavros, please go ahead.

Thank you, Stamati, and welcome to everyone joining us today. Let me walk you through the key highlights of our financial performance for the third quarter and the nine-month period ended September 30, 2025. The third quarter delivered another period of solid profitability and balanced its strength for synergy, underscoring our disciplined financial management and focus on capital efficiency. For the quarter, net revenue reached $47 million, representing a 6% increase year-over-year, while adjusted EBITDA came in at $26.6 million, broadly in line with last year's performance. Net income and adjusted net income for the quarter were 12.8 million and 14 million respectively, translating to earnings per share of 61 cents. For the first nine months of 2025, net revenue amounted to 108.7 million with adjusted EBITDA of 52.8 million. Net income for the period reached 8.8 million with earnings per share of 42 cents. While these figures are below last year's levels due to a softer market during the first half, we expect profitability to strengthen meaningfully in the fourth quarter, supported by fixtures already secured at higher levels. Turning to our balance sheet, our cash position strengthened to approximately 37 million at the end of the quarter, equivalent to 1.8 million per vessel. This reflects our disciplined approach to cash management as outflows related to vessel acquisitions earlier in the year were effectively offset by the net proceeds from the sale of our older CAPESAS vessel during the third quarter. In parallel, We continue to fund dividend distributions and an extensive dry docking program, underscoring the company's ability to invest in its fleet while maintaining robust liquidity. This healthy cash position provides financial flexibility, enabling us to pursue attractive opportunities and support our new building project with confidence. Notably, our financial performance and stability has enabled us to declare nearly 5 million in cash dividends so far this year, despite the challenging conditions of the first half, reaffirming our commitment to consistent shareholder returns. As of quarter end, our total debt stood at approximately 292 million. Based on the current market value of our fleet, this corresponds to a loan-to-fleet value ratio below 45%, reflecting a healthy and conservatively capitalized profile. On a per vessel basis, our debt stands at roughly 14.6 million, which is nearly 18 million below the average market value of our ships, highlighting the strong asset coverage supporting our balances. In terms of financing activity, this quarter we maintained a measured pace, following an exceptionally active first half of the year, during which we executed transactions totaling 110.6 million. Nevertheless, we are now in the final stages of concluding a highly attractive financing package for our new building, featuring a competitive structure and a compelling interest margin. We expect to be in a position to disclose additional details on upcoming financings soon. The constructive chief finance environment, offering multiple options across both bank and leasing markets, has been an important consideration in our decision to pursue new buildings at this stage. At the same time, we continue to assess opportunities to optimize our capital structure and expect to report additional progress in the coming months. It is also worth noting that we have a clear debt maturity profile through the second quarter of 2026, with no balloon repayments before that period. This provides valuable flexibility and ensures that we can time our future financing strategically without pressure. Finally, as of September 3, 2025, total shareholder's equity reached $271 million. With both Class D and Class E warrants now fully eliminated, Synergy's capital structure is stronger, simpler, and fully aligned with shareholder interests. That concludes my overview. I will now hand the call back to Stamatis who will provide insights on the CAPEX market and broader industry fundamentals. Stamati, over to you.

Thank you, Stavros. The Cape size market continued to show sustained strength in Q3 with average rates of about $24,600 per day, the highest levels in the recent quarters. This performance was driven by a 2% increase in ton mile demand against only 1.3% growth in available tonnage, reflecting a very tight market balance. Iron ore remained the main catalyst. Australian exports recovered strongly from early-year weather disruptions, while Brazilian record volumes surged, supported by a valid output increase and long-haul routes that amplified ton-mile demand. Looking ahead, the upcoming Simandou project in West Africa, combined with steady steel production and iron ore demand in China, underpins a solid multi-year outlook for the cave size trade. Bauxite continues to be another key growth driver, with shipments rising more than 15% year-over-year in Q3 and 20% for the nine-month period. This trend, coupled with Atlantic basin cargo growth, is expected to support high utilization levels going forward. Coal flows were also supported, led by an eight-month import high in China and increased demand across South Korea, Japan, and Southeast Asia. On the supply side, 2025 marked a record low year for Cape size deliveries with less than 1.5% fleet growth. Only 38 new building orders were placed, the lowest since 2020, while 7% of the fleet is above 20 years and 30% is above 15 years. With the global shipyard capacity effectively booked through 2029, supply growth will remain structurally constrained for several years. Overall, the combination of rising Atlantic-based trade, a historically low order book, and limited yard availability supports a sustained high earnings environment for KHI's vessels. To conclude, Synergy's pure play capes as a new customer focus continues to differentiate our platform. These larger vessels generate superior earnings capacity and long-term value compared to smaller bulk carry segments, reinforcing our boutique model based on scale where it matters, vessel size, and operational performance. Our strategy remains anchored on three priorities. capital returns maintain a consistent dividend policy and pursue share buybacks when accreted fleet renewal and growth enhance fleet efficiency and environmental performance through disciplined high return investments financial health preserve balanced strength and prudent leverage ensuring flexibility throughout market cycles. We are executing on all three fronts and remain confident that Synergy will continue to deliver industry-leading value per share as KHI's market enters another strong phase. On that note, I would like to turn the call back to the operator and receive any questions you may have. Operator, please take the call. Thank you.

Thank you.

As a reminder, to ask a question, you will need to press star 1 1 on your telephone and wait for your name to be announced.

Please stand by while we compile the Q&A roster.

Our first question comes from the line of Liam Borg from B Reuters Securities. Please go ahead. Your line is open.

Thank you. Good afternoon, Stamajos. Good afternoon, Stavros. Hello, Liam. Good morning. Stomanis, you've been very active in the fleet renewal program with the ordering and even with the sale of older assets. If I look forward, you have the financial flexibility. How do you anticipate growing the fleet? Would it be to add new builds or to mix in some secondhand vessels?

We are constantly in the market seeking opportunities both in more modern second-hand ships as well as a few new building vessels that we believe could add value to the company. We want to avoid having the so-called debt capital, you know, invest money in advances while the ships will be delivered in 2030 or whatever. So we have to be very selective, and the reason why we chose that particular shipyard is not only its quality, but also the fact that it's basically going to deliver the shipping in a year and a half from today. So that eliminates that issue. We're constantly looking for both. I cannot give you an answer right now because there's a few opportunities that we are getting closer to. So in the next few weeks, I will be in a position to discuss more.

Great. Thank you. And just taking a look at the macro, it looked like you have the best of all worlds here. As we end the year, it looks like China's steel production will be down. If I flip the narrative and say China's steel goes back to its historical growth rate of 1% or 2%, does that even increase your optimism for 26%? Or is that sort of baked in in how you look at the demand side of the case size equation?

We were never worried about the demand side, even when people were downplaying China and its ability to keep up with the housing crisis and the real estate problems. We're very optimistic about demand for iron ore, coal, and bauxite. The Simandou starting now in November and December is going to pick up a lot of long-haul demand for high-quality iron ore, and this is going to ramp up in 26 and 27, so demand is not going to be an issue. What is very interesting to note is the fact that about 23%, 24% of the global Cape size Newcastle Max and VLOC fleet is older than 16 years. And that gives you a sense, while the older book is, of course, at the lowest point. So that gives you a sense of potential supply squeezes getting into 26 and 27. So that makes us feel way more optimistic than the demand narrative.

Great. Thanks very much, Manu.

Thank you. Nice to hear from you.

Thank you.

Our next question comes from the line of Mark Reitzman from Noble Capital Markets. Please go ahead.

Thank you. And always great to see another strong quarter. Just really two questions for me on this new build contract, the five installment payments. Can we just think about that as, you know, the $41.25 million or 55% paid on the fifth payment and then the balance of the $33.75 spread over the first four payments? And what quarter do those payments begin?

Hi, Mark. This is Fabroso. Yes, I mean, your assessment is correct. Expect the 45% to be paid over the next 12 months and then at delivery, which is approximately one year and five months from now, the remaining 55%. Based on the financing that we're contemplating for this unit, we will be liable from our own cash reserves for approximately 25% of the contract price. and these installments we expect to be paid in the first quarter of 2026.

Everything else will come from debt. Okay. And then just a second question on the commercial updates. I was just kind of curious, you know, kind of the tenor, you know, going into maybe some of these renewals. I mean, do you have Do you feel like you've got more pricing power? I mean, I noticed that in some instances, the daily hire is based on a revised premium over the BCI, and I was just wondering if that premium, I'm kind of assuming that premium went up.

Well, we tend to agree the extensions for a period of about 12 to 14 months. This is what we like, and that's what the chapters are comfortable about. We have no concern into renewing them thereafter, so it's not going to be an issue. And we have proven to be in a position to renew our ships consistently with very high-quality charters all the way until they become close to 20 or sometimes above 20 years old. So we see no issue in renewing anything for longer periods. We like it the way it is right now. And that provides flexibility on both sides of the transaction, both for us and the chatterers. And we like it like this.

Okay. Just to go back, I mean, in terms of the pricing power, is that even something that you kind of think about? Or, I mean, do you have greater leverage in this market or less? Or can you even comment on the revised premium over the BCI on some of those contracts?

Yes. The way that we obtain this premium, that we achieve this premium, is with the conversions that we do. So whenever we feel the time is right and the forward rate is above the BCI, that's when we trigger certain conversions and we feel comfortable about securing certain cash flows. I'm not going to say coincidentally, but in most cases that leads us to the premium over the BCI. In certain cases, of course, we may not be able to get the full extent of that, but we like that we hedge the downside. We feel way more confident and comfortable to have a certain stream of cash flows. Even if we lose a couple of thousand from the upside, we feel better off by securing the downside risk in certain quarters that might be weaker throughout the year.

I see. Thank you very much. That's very helpful.

Very welcome and nice to hear from you.

Thank you.

As a reminder, to ask a question, please press star 1 and 1 on the telephone. Our next question comes from the line of state, Sullivan from Maxim Group. Please go ahead.

Thank you. Congratulations on the new build and consistent with how you've been talking about the market for the last at least two years. Was there a specific secondhand transaction in the market that made you decide to go the new build route? At what point did the S&P prices increase to a level where new builds are more attractive?

Good morning, Tate, and thanks for the question. Yes, I mean, there comes a time where we have triggering events. we were chasing a couple of secondhand acquisitions and we missed on those because the higher bidders paid more than 20% or 15-20% than what we had anticipated or what we considered to be the fair value of that asset for that particular time. So when you see this kind of abrupt increases in prices of secondhand vessels, which are not like really modern, I mean, we're talking about close to 15 years old or 12 years old or 13 years old, then it kind of drives you, the decision automatically gets, you know, taken. So that's how the triggering events happen.

And how can you, thank you, and how were you able to secure a 2027 delivery Was it the last slot in the China shipyard or one of the last slots? Did you consider other countries as well?

Well, quality above all. So we're not going to sacrifice any delivery for inferior quality, as you can understand. So we found this, I mean, we have been in discussions with various shipyards for quite some time. We chose that. We might be seeking other solutions as well at similar other shipyards of high quality in China. So we will not sacrifice the quality of this vessel for early delivery. In this particular case, we kind of had the win-win situation where we had prompt delivery, kind of prompt delivery, and at the same time, very high quality. So we felt comfortable with that. We have certain good connections with a lot of people in the Far East. So we believe we will be able to source some other deals as well.

Okay. You mentioned that earlier, too. We'll look out for those. And then, Stavros, on the cost of your debt, your interest rate going forward, I'm sorry if I missed it, but do you think you're now at about the 7% interest rate level or even lower with where floating rates have gone?

It's lower than that. I mean, look, the financings that we have concluded recently, the margins are at around 2%. And as we move forward, the ones that we are negotiating now, a couple of packages in connection with a new building and some refinancings that we want to do are even lower. I mean, from quarter to quarter, you might see variations because there are certain fees that are being paid in order to break a financing or get into another financing, which sometimes are charged under the interest expenses. But overall, judging where so far is today, I would estimate the average cost to be closer to five and a half below six.

Thank you very much.

Thank you, Tate.

Thank you.

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This concludes today's conference call.

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