Safe Bulkers, Inc.

Thank you for standing by, ladies and gentlemen, and welcome to the SafeBulkers conference call to discuss the third quarter 2022 financial results. Today we have with us from SafeBulkers, Chairman and Chief Executive Officer, Mr. Paulus Hajianu, President, Dr. Lucas Barbaros, and Chief Financial Officer, Mr. Konstantinos Adamopoulos. 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, please press star 1 on your telephone keypad and wait for the automated message advising your line is open. Following this conference call, if you need any further information on the conference call or on the presentation, please contact Capital Link at 212-661-7566. I must advise you that this conference is being recorded today. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Forward-looking statements will be read now. Before we begin, please note that this presentation contains forward-looking statements as defined in Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. Concerning future events, the company's growth strategy and measures To implement such strategy, including expected vessel acquisitions and entering into further time charters, words such as expects, intends, plans, believes, anticipates, hopes, estimates, and variation of such words and similar expressions are intended to identify forward-looking statements. Although the company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates which are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results that differ materially include, but are not limited to, changes in the demand for dry bulk vessels, competitive factors in the market in which the company operates, risks associated with operations outside the United States, and other factors listed from time to time in the company's filings with the Securities and Exchange Commission. The company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the company's expectations with respect thereto or any change in events, conditions, or circumstances on which any statement is based. And now I will turn the floor over to Dr. Barparas. Please go ahead, sir.

Good morning. I'm Lukas Barbaris, President of SafeBuyGas. Welcome to our conference call and webcast to discuss the financial results for the third quarter of 2022. The third quarter was a good quarter. We had a satisfactory financial performance of 41 cents earnings per share and maintained a gradually weakening chapter market environment compared to the previous quarter, with increased revenues due to past contracts and earnings from scrapper fitted vessels, and higher interest expenses due to increasing interest rates. In this environment, we maintain strong balances, levels comparable to our critical value, and liquidity and capital resources providing us with the required flexibility. As we see in slide three, certain of our characteristics differentiate us from our peers. The growth of our fleet and our fleet expansion on one hand, leverage, liquidity, and contracted revenues on the other, not only rewarding our shareholders through the dividend policy, but in parallel creating increased value through an extensive fleet expansion. We would like to focus on our fleet quality and our environmental investments presented in slide four, because this is the basis on which we compete in the market against our peers. All 44 vessels in our fleet will have balanced water treatment system by the end of 2022. All eight of our capes will have straddles by the end of 2023, and 21 vessels will be environmentally upgraded more our fleet by the end of 2023 will consist of 19 vessels, 12 being echo. Out of the total fleet, 19 vessels will be 12 echo ships and seven phase III ships. In flight five, the environmental ratings, These ventures have the best environmental performance globally in the dry bark market on their deadweight tonnage, with impressive savings in fuel consumption. We intend to compete on this basis with our new big fleet, with seven such seats by the end of 2023 and ten by the end of 2024. We would like to focus on our improved capital structure in slide six. We are maintaining a comfortable leverage of $448 million compared to our free-to-skip value of $390 million, with a peak of 10.5 years of age. During 2022, we had 187 million of our 8% preferred C-shares. At the same time, our average interest rate stands at 2.91% for our consolidated debt, with a portion of 100 million euros at a 295 fixed interest rate in a secured five-year loan. Our liquidity is preserved in slide 7. Our liquidity and capital resources are maintained strong at 266 million, which together with the contract revenue of 327 million, as seen in slide 8, We are well hedged against the market volatility. Currently, the Baltic Cape Size Index ITC stands at $12,400 per day, while I see in the left graph of slide 8, 7 out of 8 of our Cape Size the 22,700 average pay separate, totaling to 185 million contracted revenue from CAIPS alone. As presented in slide 9, we have maintained a level of dividend at 5 cents per share over the last quarters, translated to an improving dividend yield, mainly reflecting prevailing conditions in the capital markets. Focal points in this uncertainty of these capital markets and the world economy is that we continue to direct a portion of our free cash flows to finance our utilities that will provide us with competitive advantage in terms of fuel consumption and environmental performance, while maintaining our leverage at relatively low levels, as we have already discussed. In addition, we have repurchased 2.8 million of FOMO shares. In slide 10, We show the relationship amongst our debt, flip-strap value, contracted revenue, cash and liquidity, and capex requirements. With a strong company balance fundamentals, ample liquidity leveraged at a comparable level to flip-strap value, secured cash flows from reliable counterparties, flip expansions with level of 2023 onwards, the government is well-positioned to react on challenges and take advantage of opportunities. Let me now summarize the takeaways in slide 11. We believe that sales back is fundamental for the financial flexibility to reflect market Each product is among those companies that will successfully navigate the environmental challenges of the energy transition and of the energy drive-back fleet, and will tackle the global uncertainties by utilizing the inherited qualities of each fleet and the efficiencies of each large-scale environmental upgrade in Europe. In parallel to the company's expansion, we believe we offer a meaningful deal. Now, let's move to the slide for the industry update. We present on the graphs the current status of the market. Changes have been, over time, driven by the commodity dynamics at levels such as The supply side, as we said in slide 14, the order book starts at 8.6%, which is a relatively low level compared to the past year, and thus we remain cautiously optimistic despite the global instability caused by war, energy crisis, and evidently inflationary pressure. We do expect scrapping to accelerate as a combined effect of fleet aging, about 25% of fleet is older than 15 years old, and environmental regulations that keep off the thick of the first of January 2023. Moving on to slide 15, we present the development of the CRB commodity index, which currently stands at a five-year high. The index reflects basic commodity future prices, for example, energy, agriculture, precious metals, and industrial metals, which represent leading indicators for shipping. Normalization of monetary and fiscal policies that deliver support during the pandemic is fully in demand, as policy makers aim to lower inflation back to target. The October forecast of IMF as well as lingering supply-demand imbalances, and is anticipated to reach 8.8% this year and 6.5% for 2023. In 2023, this inflationary monetary policy is expected to affect global output, with a projected increase by just 2.7%. and are also hemorrhage for the macro outlook. In China, the deepening of real estate crisis have led growth to be revised downward, with major global and drive-back stillovers. as global investments in renewable electricity capacity will continue to rise. An increasing share of economies are in a growth slowdown or outright contraction. The global economy's future rests critically on the successful calibration of monetary policy, the course of the war in Ukraine, and the possibility of further pandemic-related supply disruptions, for example, in China. Turning to slide 16, We focus on increasing value creation as a result of our investment in scrappers technology currently installed on 18 of our vessels. The very low-circuit fuel oil versus heavy-circuit fuel oil price differential is translated to increase revenues for the scrapper-fitted vessels. Presently, high-five in Singapore starts at about 270 per ton and at about 250 At this astute price for 2023, the implied scrubber gain potential is about 23 million per annum for our 18 scrubber field measures. And as we said already, we are in the process of installing additional scrubbers in our field measures. Concluding our market view in slide 17, during 2032, there has been an increased industry-wide volatility driven by geopolitical disruptions. The ESG framework and Paris Agreement adherence becomes increasingly important in dry bark trade, and as a result, demand for technological efficiency creates opportunities for those willing to invest, as Shade Barkers has done. Such environmentally efficient fleets may affect company valuations and lead to toothier markets with differentiation in earnings capacity of such assets. Furthermore, there might be spillovers in the transition towards green energy and the global inflationary environment. Now let me pass the floor to our CEO for our financial overview.

Thank you, Lucas, and good morning to everyone. On a general note, during the quarter, this quarter, we operated in a gradually weakening we present our quarterly net revenues and adjusted debita both standing at satisfactory levels. Slide 20 will present a strong charting performance and example of our management alignment. We achieved a daily time charting equivalent of $23,403 compared to $24,427 during the same period in 2021. The net income for the third quarter net income of $55.4 million during the same period in 2021. Our daily OPEX stood at $4,949 versus $4,608 last year. Our daily OPEX excluding dry docking pre-delivery expenses stood at $4,571, almost unchanged from last year's figure of $450. $309, which we believe is one of the most competitive compared to our peers. This number includes all our dry docking and pre-delivery expenses, as well as all our director and officers' compensation. We will try to do the right thing. For example, we have 0% commission of chartering management for our managers, and through our managers, Moving to slide 21, we present our fleet contracted employment percentage, noting that we have contracted revenue of approximately 314 million net of commission. always in the industry and the cash flow bridge in millions for the same period. The global economy is experiencing a number of turbulent challenges. Inflation higher than what was seen in several decades, tightening financial conditions in most regions, a racist invasion of Ukraine and the lingering COVID-19 pandemic all weigh heavily on the market outlook. Of course, our main focus is lean operations in Flight 24 will present our own balance sheet analysis. compared to $67.7 million for the same period in 2021. Our adjusted earnings per share for the third quarter of 2022 was $0.39, calculated on a weighted average number of 120.4 million shares, compared to $0.40 during the same period in 2021, calculated on a weighted average number of 119.9 million shares. In conclusion, in slide 26, we saw our quarterly operational highlights for the third quarter of 2022 compared to the same period last year. Based on a satisfactory financial performance, the company's board of directors declared a 5 cent dividend per common share. We would like to emphasize that the company is maintaining a healthy cap position of about $130 another $144.3 million in available revolving-grade facilities, as well as $51 million in undrawn-boring capacity available at other two loan facilities in relation to two new vessels. That's a combined liquidity of over $330 million that provides us with significant firepower. Furthermore, and in addition to our contracted liquidity, and additional borrowing capacity in relation to seven dead-free existing vessels and seven new builds upon their delivery. We believe that a strong liquidity and relatively low leverage will enable us to be flexible with our capital structure, expand the fleet, while still rewarding our shareholders. Our basic list presents in more detail our financial and operational results, and we