NEW YORK, Aug 22, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- Genco Shipping & Trading
Limited (NYSE: GNK) today announced that it has reached an agreement with
Pacific Basin Chartering Ltd. to time charter three of the six vessels that
Genco has agreed to acquire from affiliates of Evalend Shipping Co. S.A.
These vessels are to be renamed the Genco Charger, the Genco Challenger, and
the Genco Champion and were built in 2005, 2003, and 2006, respectively. The
time charter for each vessel will be for 35 to 37.5 months at a rate of
$24,000 per day, less a 5% third party brokerage commission. The time
charters will commence upon delivery of the three Handysize vessels, which are
expected during the fourth quarter of 2007, and are subject to the completion
of definitive documentation.
Robert Gerald Buchanan, President, commented, "Our time charters for the
Genco Charger, the Genco Challenger and the Genco Champion are consistent with
management's focus on taking advantage of the strong market conditions in the
drybulk industry and locking in attractive rates for a large portion of our
fleet over the long term. Following our recent acquisitions, we are pleased to
have secured these vessels on three-year contracts at favorable rates prior to
taking delivery of the ships. As we continue to seek opportunities to
strengthen the considerable time charter coverage for our expanded fleet, we
remain committed to seeking to distribute sizable dividends to our
shareholders."
The following table reflects the employment of Genco's current fleet plus
the three Handysize vessels to be acquired after giving effect to the new time
charters:
Charter Time Charter
Vessel Charterer Expiration (1) Rate (2)
Capesize Vessel
Genco Augustus Cargill International S.A. December 2009 $45,263(3)
Panamax Vessels
Genco Beauty Cargill International S.A. May 2009 31,500
Genco Knight SK Shipping Ltd. May 2009 37,700(4)
Genco Leader A/S Klaveness December 2008 25,650(5)
Genco Trader Baumarine AS October 2007 25,750(5)
Genco Vigour STX Panocean (UK) Co. Ltd. March 2009 29,000(6)
Genco Acheron STX Panocean (UK) Co. Ltd. February 2008 30,000(7)
Genco Surprise Cosco Bulk Carrier Co.,
Ltd. November 2007 25,000
Handymax Vessels
Genco Success KLC January 2008 24,000
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 HMMC November 2007 24,000
Genco Marine NYK Bulkship Europe S.A. February 2008 24,000(8)
Genco Muse Qatar Navigation QSC September 2007 26,500(9)
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
Genco Challenger Pacific Basin
Chartering Ltd. 35 to 37.5 months
from delivery date 24,000
Genco Champion Pacific Basin
Chartering Ltd. 35 to 37.5 months
from delivery date 24,000
(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) 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.
(4) A new time charter for 23 to 25 months at a rate of $37,700 per day
less a 6.25% third party commission commenced following the expiration
of the vessel's previous time charter on June 30, 2007.
(5) 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.
(6) 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.
(7) The vessel was delivered to the charterer for the commencement of the
time charter on March 20, 2007.
(8) The vessel was delivered to the charterer for the commencement of the
time charter on March 29, 2007.
(9) 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 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.
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 20 drybulk vessels
consisting of one Capesize, seven Panamax, seven Handymax and five Handysize
vessels, with a carrying capacity of approximately 1,168,000 dwt. After the
delivery of six vessels from affiliates of Evalend Shipping Co. S.A. and the
eight 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.
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 20 drybulk vessels
consisting of one Capesize, seven Panamax, seven Handymax and five Handysize
vessels, with a carrying capacity of approximately 1,168,000 dwt. After the
delivery of six vessels from affiliates of Evalend Shipping Co. S.A. and the
eight 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 with Pacific Basin
Chartering Ltd. for the time charters described above; (ii) execution of
additional definitive documentation for the Company's agreements to acquire
the six Evalend drybulk vessels; (iii) the fulfillment of the closing
conditions under the Company's agreements to acquire the six Evalend drybulk
vessels; (iv) the fulfillment of the closing conditions under the Company's
agreement to acquire the nine Metrostar drybulk vessels; (v) increases in
costs and expenses including but not limited to: crew wages, insurance,
provisions, repairs, maintenance and general and administrative expenses; (vi)
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
John C. Wobensmith, Chief Financial Officer of Genco Shipping & Trading Limited,
+1-646-443-8555
http://www.gencoshipping.com/