Genco Shipping & Trading Ltd

Please stand by. We're about to begin. Good morning, ladies and gentlemen, and welcome to the Genco Shipping and Trading Limited fourth quarter 2020 earnings conference call. Before we begin, please note there will be a slide presentation accompanying today's conference call. That presentation can be obtained from Genco's website at www.gencoshipping.com. To inform everyone, today's conference is being recorded and is being webcast at the company's website at www.gencoshipping.com. We will conduct a question and answer session after the opening remarks. Instructions will follow at that time. A replay of the conference is accessible anytime during the next two weeks by dialing 888-203-1112 or 719-457-0820 and entering the passcode 950-1899. At this time, I will turn the comments over to the company. Please go ahead.

Good morning. Before we begin our presentation, I note that in this conference call, we will be making certain forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as anticipate, budget, estimate, expect, project, intend, plan, believe, In other words, in terms of similar meaning in connection with the discussion of potential future events, circumstances or future operating or financial performance. These forward looking statements are based on management's current expectations and observations. For a discussion of factors that could cause results to differ, please see the company's press release that was issued yesterday, the materials relating to this call posted on the company's website, and the company's filings with the Securities and Exchange Commission, including, without limitation, the company's annual report on Form 10-K for the year ended December 31, 2020, and the company's reports on Form 10-Q and Form 8-K subsequently filed with the SEC. At this time, I would like to introduce John Bobensmith, Chief Executive Officer of Genco Shipping and Trading Limited.

Good morning, everyone. Welcome to Joe's fourth quarter 2020 conference call. I will begin today's call by reviewing our 2020 and year-to-date highlights, discuss our financial results for the quarter and the industry's current fundamentals before opening the call up for questions. For additional information, please also refer to our earnings presentation posted on our website. During a highly challenging operating environment in 2020, our strong in-house commercial platform and operations team continued to build on its track record of benchmark outperformance, while we took important steps to execute our strategic plan and effectively position Genco for the long term. For the year, we outperformed our internal benchmarks by approximately $800 per day, generating $15 million of incremental EBITDA. Notably, 2020 marked the third consecutive year of benchmark outperformance for our minor bulk fleet. In addition, our time chart equivalent in Q4 of $13,167 was the highest Genco has achieved in two years. Our strategy of maintaining short-term coverage during trough market conditions earlier in 2020 and repositioning the fleet ahead of an expected market upturn paid off with strong performance in the second half of the year. The unfortunate onset of COVID-19 in early 2020 resulted in a demand shock that significantly impacted the dry bulk earnings environment, particularly during the second quarter of last year. However, dry bulk earnings were able to meaningfully recover beginning in June. The Q2 impact and the subsequent rebound in freight rates is highlighted on slide eight of our presentation. by the earnings of our Cape size vessels, which realized time charter equivalents of over $16,000 per day in each quarter of 2020, with the exception being the COVID related lows of Q2. During the first quarter of 2021 today, we had selectively repositioned vessels in both our major and minor bulk fleets to improve earnings over the remainder of the year. Given our opportunistic chartering strategy, we anticipate the majority of the vessels in our fleet to be open for fixing in mid-March to mid-April to take advantage of the meaningful increase in rates we've seen recently and the expectation of more to come. As part of the significant progress we have made renewing our fleet, we efficiently completed the vessel divestiture portion of our fleet renewal program through the sale of our 53,000 deadweight ton supermaxes, and our non-core handy-sized fleet while expanding in the core Ultramax sector. In December, we announced the acquisition of three modern fuel-efficient Ultramax vessels in exchange for six older non-core handy-sized vessels. This transaction, which is structured as an asset swap without additional capital required, accomplished a number of key objectives for Genco, including building scale in our core Ultramax sector to complement our in-house commercial platform while divesting non-core assets. Importantly, this also reduces the average age of our fleet and eliminates nearly $4 million of scheduled dry docking capex in 2021. Moving to capital allocation, and based on our strong balance sheet combined with positive dry bulk market fundamentals, Genco declared our sixth consecutive quarterly dividend, highlighting our focus on returning capital to shareholders. This brings total dividends declared to 75.5 cents per share since the third quarter of 2019. Effectively deploying our capital will remain a top priority for management. We intend to continuously evaluate our capital allocation strategy as the dry bulk market further improves with the goal of creating shareholder value over the long term. Regarding the liquidity of our shares, since mid-December, ownership of large shareholders with board representation has been reduced from 58% down to 32% currently. While we believe this has contributed to Genco trading at a discount to NAV and trailing stock performance compared to a number of our peers in the short term, we view this as a positive in the long term due to increased overall liquidity and free flow. Looking forward, we believe the dry bulk outlook is favorable. Specifically, the order book as a percentage of the fleet is at an all-time low, limiting net fleet growth. while unprecedented stimulus and over 5% global projected GDP growth, as well as the Brazilian iron ore export recovery, have combined to create improving supply and demand conditions. With the ownership of both major and minor bulk vessels, our world-class in-house commercial operating platform, and our industry-leading balance sheet, Genco is well-positioned to benefit from these compelling industry fundamentals. We believe the record low order book in particular will be an important catalyst in creating a dry bulk market environment in which demand growth outpaces supply growth in the coming years. A very positive driver for freight rates. Lastly, in January, we signed the Neptune Declaration on Seafarer Wellbeing and Crew Change to address the unprecedented crew change crisis caused by COVID-19. Genco has worked tirelessly to return seafarers to their home country safely and on time, completing over 100 crew rotations in 2020, involving approximately 2,000 seafarers. Amid the ongoing COVID-19 pandemic, Genco continues to prioritize the health and safety of both our crew members and onshore team. We thank global seafarers for their sacrifices and commitment to professionalism during a very challenging period. and we remain committed to facilitating crew changes to help resolve this humanitarian crisis as quickly as possible. I will now turn the call over to Apostol Sifoulias, our Chief Financial Officer.