Investors

Genco Shipping & Trading Limited Announces Plan to Sign Time Charter for Two Newly Acquired Vessels

Sep 05, 2007
Company Plans to Extend Time Charter for Handymax Vessel
NEW YORK, Sept 05, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- Genco Shipping & Trading Limited (NYSE: GNK) today announced that it has reached an agreement to enter into a time charter for two vessels it has recently agreed to acquire. The Genco Constantine, a Capesize newbuilding, is scheduled to be on charter with Cargill International S.A. for 54 to 62 months at a rate of $52,750 per day, less a 5% third party brokerage commission. The time charter for the Genco Constantine includes a 50% index-based profit sharing component. In addition, the Genco Warrior, a 2005-built Supramax vessel, is scheduled to be on charter with Hyundai Merchant Marine Co. Ltd. for 35 to 37.5 months at a rate of $38,750 per day, less a 5% third party brokerage commission.

The Company also announced that it has reached an agreement to extend the time charter for the Genco Success, a 1997-built Handymax vessel currently on charter with Korea Line Corporation. The extended time charter will be for an additional 35 to 37.5 months at a rate of $33,000 per day, less a 5% third party brokerage commission.

The time charters for the Genco Constantine and the Genco Warrior will commence upon delivery of the vessels, which are anticipated during the second quarter of 2008 and the fourth quarter of 2007, respectively. The extended time charter for the Genco Success is expected to commence on March 1, 2008, following the expiration of its current time charter. All three charters are subject to the completion of definitive agreements.

Robert Gerald Buchanan, President, commented, "In reaching agreements for two of our newly acquired vessels prior to their delivery, we are pleased to enter into a profit sharing arrangement for the Genco Constantine, which will enable Genco to benefit from a strong rate environment as well as create a floor with the base rate. Additionally, our extended charter for the Genco Success represents a 37.5% increase in the gross rate from the current charter as we continue to take advantage of the favorable fundamentals in the drybulk industry and renew contracts at higher levels."

Mr. Buchanan added, "With these agreements, we have approximately 89% of our fleet's estimated available days secured on contracts for the remainder of 2007 and 68% for 2008. Going forward, we will maintain our focus on locking away a large portion of our fleet on time charters and seeking to provide shareholders with sizeable dividends."

    The following table reflects the current employment of Genco's current
fleet as well as the employment or other status of vessels expected to join
Genco's fleet:



                                                           Time
                                             Charter      Charter   Expected
       Vessel          Charterer          Expiration(1)   Rate(2)  Delivery(3)

    Capesize Vessels
    Genco Augustus  Cargill
                     International S.A.   December 2009  $45,263(4)          -
    Genco Tiberius  Cargill
                     International S.A.   January 2010    45,263(4)          -
    Genco London    SK Shipping Co., Ltd  35 to 39
                                           Months from
                                           delivery date  57,500(4)(5) Q4 2007
    Genco Titus     Cargill
                     International S.A.   48 to 62
                                           Months from
                                           delivery date  45,000(4)(6) Q4 2007
    Genco           Cargill
     Constantine     International S.A.   54 to 62
                                           Months from
                                           delivery date  52,750(7)   Q2 2008
    Genco Hadrian   To be determined
                     ("TBD")              TBD                TBD      Q4 2008
    Genco Commodus  TBD                   TBD                TBD      Q2 2009
    Genco Maximus   TBD                   TBD                TBD      Q2 2009
    Genco Claudius  TBD                   TBD                TBD      Q3 2009

    Panamax Vessels
    Genco Beauty    Cargill
                     International S.A.   May 2009        31,500            -
    Genco Knight    SK Shipping Ltd.      May 2009        37,700            -
    Genco Leader    A/S Klaveness         December 2008   25,650(8)         -
    Genco Trader    Baumarine AS          October 2007    25,750(8)         -
    Genco Vigour    STX Panocean (UK)
                     Co. Ltd.             March 2009      29,000(9)         -
    Genco Acheron   STX Panocean (UK)
                     Co. Ltd.             February 2008   30,000            -
    Genco Surprise  Cosco Bulk Carrier
                     Co., Ltd.            November 2007   25,000            -
                    Hanjin Shipping
                     Co., Ltd.            35 to 37
                                           months from
                                           delivery to
                                           new charterer  42,100            -

    Supramax Vessels
    Genco Predator  Intermare
                     Transport GmbH       January 2008    22,500 (10) Q4 2007
    Genco Warrior   Hyundai Merchant
                     Marine Co. Ltd.      35 to 37.5
                                           months from
                                           delivery date  38,750      Q4 2007
    Genco Hunter    TBD                   TBD                TBD      Q4 2007

    Handymax Vessels
    Genco Success   KLC                   March 2008/     24,000/
                                           January 2011   33,000 (11)      -
    Genco
     Commander      A/S Klaveness         October 2007    19,750           -
    Genco Carrier   Pacific Basin
                     Chartering Ltd.      February 2008   24,000           -
    Genco
     Prosperity     A/C Pacific Basin
                     Chartering Ltd.      April 2008      26,000           -
    Genco Wisdom    Hyundai Merchant
                     Marine Co. Ltd.      November 2007   24,000           -
    Genco Marine    NYK Bulkship
                     Europe S.A.          February 2008   24,000           -
    Genco Muse      Qatar Navigation QSC  October 2007    26,500(12)       -

    Handysize Vessels
    Genco Explorer  Lauritzen Bulkers A/S September 2007  13,500           -
                                           August 2009    19,500
    Genco Pioneer   Lauritzen Bulkers A/S September 2007  13,500           -
                                           August 2009    19,500
    Genco Progress  Lauritzen Bulkers A/S September 2007  13,500           -
                                           August 2009    19,500
    Genco Reliance  Lauritzen Bulkers A/S September 2007  13,500           -
                                           August 2009    19,500
    Genco Sugar     Lauritzen Bulkers A/S September 2007  13,500           -
                                           August 2009    19,500
    Genco Charger   Pacific Basin
                     Chartering Ltd.      35 to 37.5
                                           months from
                                           delivery date  24,000     Q4 2007
    Genco           Pacific Basin
     Challenger      Chartering Ltd.      35 to 37.5
                                           months from
                                           delivery date  24,000     Q4 2007
    Genco Champion  Pacific Basin
                     Chartering Ltd.      35 to 37.5
                                           months from
                                           delivery date  24,000     Q4 2007

    (1) The charter expiration dates presented represent the earliest dates
        that our charters may be terminated in the ordinary course.  Under the
        terms of each contract, the charterer is entitled to extend time
        charters from two to four months in order to complete the vessel's
        final voyage plus any time the vessel has been off-hire.
    (2) Time charter rates presented are the gross daily charterhire rates
        before the payments of brokerage commissions ranging from 1.25% to
        6.25% to third parties, except as indicated for the Genco Trader and
        the Genco Leader in note 4 below. In a time charter, the charterer is
        responsible for voyage expenses such as bunkers, port expenses,
        agents' fees and canal dues.
    (3) Dates for vessels delivering in the future are estimates based on
        guidance received from the sellers and/or respective shipyards.
    (4) The time charter rate is below current market rates and therefore will
        result in a liability that will amortize as an increase to revenue.
        See Note 2, Summary of Significant Accounting Policies under the
        caption "Vessel acquisitions" in the footnotes to our financial
        statements in our Form 10-Q for the quarterly period ended June 30,
        2007 for disclosure of our policy.
    (5) The Genco London is scheduled to be on charter with SK Shipping Co.,
        Ltd. for 35 to 39 months at a gross rate of $57,500 per day. The
        charter is due to expire between September 2010 and January 2011.
    (6) The Genco Titus is scheduled to be on charter with Cargill
        International S.A., for 48 months at a gross rate of $45,000 per day.
        The charter, which is due to expire in December 2011, also includes a
        50 percent index-based profit sharing component. The charterer has the
        option to extend the charter for a period of one year with 2 months
        more or less on the optional year.
    (7) The Genco Constantine is scheduled to be on charter with Cargill
        International S.A., for 54 to 62 months at a gross rate of $52,750 per
        day less a 5% third party brokerage commission. The charter also
        includes a 50 percent index-based profit sharing component.
    (8) For the Genco Leader and the Genco Trader, the time charter rate
        presented is the net daily charterhire rate. There are no payments of
        brokerage commissions associated with these time charters.
    (9) We have entered into a time charter for 23 to 25 months at a rate of
        $33,000 per day for the first 11 months, $25,000 per day for the
        following 11 months and $29,000 per day thereafter, less a 5% third-
        party brokerage commission. For purposes of revenue recognition, the
        time charter contract is reflected on a straight-line basis at
        approximately $29,000 per day for 23 to 25 months in accordance with
        generally accepted accounting principles in the United States, or U.S.
        GAAP. The time charter, commenced following the expiration of the
        vessel's previous time charter on May 5, 2007.
    (10) The Genco Predator is currently on charter with Intermare Transport
        GmbH at a gross rate of $22,500 per day. The charter is due to expire
        between January 2008 and March 2008.  The rate is below current market
        rates and therefore will result in a liability that will amortize as
        an increase to revenue. See our Summary of Significant Accounting
        Policies under the caption "Vessel acquisitions" in our footnotes in
        the June 30, 2007 Form 10-Q for disclosure of our policy.
    (11) The Company intends to extend the time charter for an additional 35
        to 37.5 months at a rate of $33,000 less a 5% third party brokerage
        commission. The new charter will commence following the expiration of
        the previous charter on March 1, 2008.
    (12) Since this vessel was acquired with an existing time charter at an
        above-market rate, we allocated the purchase price between the vessel
        and an intangible asset for the value assigned to the above-market
        charterhire. This intangible asset is amortized as a reduction to
        voyage revenues over the minimum remaining term of the charter,
        resulting in a daily rate of approximately $22,000 recognized as
        revenues.  For cash flow purposes, we will continue to receive $26,500
        per day until the charter expires. Effective September 3, 2007, the
        Company will record the full $26,500 per day since the amortization
        period has ended.

About Genco Shipping & Trading Limited

Genco Shipping & Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Genco Shipping & Trading Limited currently owns a fleet of 21 drybulk vessels consisting of two Capesize, seven Panamax, seven Handymax and five Handysize vessels, with a carrying capacity of approximately 1,343,000 dwt. After the delivery of six vessels from affiliates of Evalend Shipping Co. S.A. and the seven remaining vessels from companies within the Metrostar Management Corporation group, Genco Shipping & Trading Limited will own a fleet of 34 drybulk vessels, consisting of nine Capesize, seven Panamax, three Supramax, seven Handymax and eight Handysize vessels, with a carrying capacity of approximately 2,814,000 dwt.

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on management's current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this press release are (i) the terms and conditions of any definitive documentation that the Company may execute for the time charters described above; (ii) the fulfillment of the closing conditions under the Company's agreements to acquire the six Evalend drybulk vessels; (iii) the fulfillment of the closing conditions under the Company's agreement to acquire the remaining seven Metrostar drybulk vessels; (iv) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, repairs, maintenance and general and administrative expenses; (v) changes in the condition of the Company's vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; and other factors listed from time to time in our public filings with the Securities and Exchange Commission including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2006, our Quarterly Reports on Form 10-Q, and our reports on Form 8-K. Our ability to pay dividends in any period will depend upon factors including the limitations under our loan agreements, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary.

SOURCE Genco Shipping & Trading Limited


http://www.gencoshipping.com