Genco Shipping & Trading Limited Announces Plan to Sign Time Charter for Capesize Vessel

Jan 15, 2010
Increases Time Charter Coverage to 57% for 2010
NEW YORK, Jan 15, 2010 /PRNewswire via COMTEX/ -- Genco Shipping & Trading Limited (NYSE: GNK) today announced that it has reached an agreement to enter into a time charter for the Genco Augustus, a 2007-built Capesize vessel, with Cargill International S.A. for approximately 10.5 to 12.5 months at a rate of $39,000 per day, less a 5% third-party brokerage commission.

The time charter for the Genco Augustus is subject to the completion of definitive documentation and is expected to commence on or about January 23, 2010 following the vessel's scheduled drydocking. The previous time charter for the Genco Augustus was completed on January 10, 2010.

The following table reflects the current employment of Genco's fleet:

                                           Charter                     Revenue
                     Year                 Expiration         Cash      Daily
         Vessel      Built Charterer        (1)          Daily Rate(2) Rate(3)
         ------      ----- -------------  ----------     ------------- -------

                           International     December
      Genco Augustus  2007 S.A.                  2010           39,000

                           International     February
      Genco Tiberius  2007 S.A.                  2010           45,263 62,750

                           SK Shipping
      Genco London    2007 Co., Ltd       August 2010           57,500 64,250

                           International    September
      Genco Titus     2007 S.A.                  2011        45,000(4) 46,250

      Genco                International
       Constantine    2008 S.A.           August 2012        52,750(4)

      Genco Hadrian   2008 S.A.          October 2012        65,000(4)

      Genco Commodus  2009 Group Inc.       June 2011           36,000

                           International     February
      Genco Maximus   2009 S.A.                  2010           31,750

                           International     November
      Genco Claudius  2010 S.A.                  2010        36,000(5)

      Panamax Vessels
      Genco Beauty    1999 Geneva          March 2010           19,125

                           Services          February
      Genco Knight    1999 S.A.                  2010           16,500

                           Baumarine AS/
                           Klaveness       Jan 10/Dec
      Genco Leader    1999 Chartering              10           20,742/

      Genco Vigour    1999 Ltd.           November 10           24,000

      Genco Acheron   1999 Ltd.             July 2011           55,250
                           (a subsidiary

                           Shipping          December
      Genco Surprise  1998 Co., Ltd.             2010           42,100

                           COSCO Bulk
      Genco Raptor    2007 Co., Ltd.       April 2012           52,800

      Genco Thunder   2007 Chartering      March 2010           20,000

      Genco Predator  2005 Handymax A/S    April 2010           Spot(7)

                           Marine Co.        November
      Genco Warrior   2005 Ltd.                  2010           38,750

                           Pacific Basin
                           Chartering        February
      Genco Hunter    2007 Ltd.                  2010           17,000

                           Clipper Bulk      February
      Genco Cavalier  2007 Shipping NV           2010           16,750

                           Korea Line        February
      Genco Success   1997 Corporation           2011        33,000(8)

                           Louis Dreyfus
      Genco Carrier   1998 Corporation     March 2011           37,000

                           Pacific Basin
      Genco                Chartering
       Prosperity     1997 Ltd.             June 2011           37,000

                           Marine Co.        February
      Genco Wisdom    1997 Ltd.                  2011           34,500

                           STX Pan Ocean     February
      Genco Marine    1996 Co. Ltd.              2010           15,500

      Genco Muse      2001 Ltd.          January 2010           15,000

                           Lauritzen         April
      Genco Explorer  1999 Bulkers A/S           2010           Spot(9)

                           Lauritzen         April
      Genco Pioneer   1999 Bulkers A/S           2010           Spot(9)

                           Lauritzen         January
      Genco Progress  1999 Bulkers A/S           2011           Spot(9)

                           Lauritzen         January
      Genco Reliance  1999 Bulkers A/S           2011           Spot(9)

                           Lauritzen         January
      Genco Sugar     1998 Bulkers A/S           2011           Spot(9)

                           Pacific Basin
                           Chartering        November
      Genco Charger   2005 Ltd.                  2010           24,000

                           Pacific Basin
      Genco                Chartering        November
       Challenger     2003 Ltd.                  2010           24,000

                           Pacific Basin
                           Chartering        December
      Genco Champion  2006 Ltd.                  2010           24,000

(1) The charter expiration dates presented represent the earliest dates that our charters may be terminated in the ordinary course. Except for the Genco Titus, Genco Constantine, and Genco Hadrian under the terms of each contract, the charterer is entitled to extend the 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. The charterer of the Genco Titus and Genco Hadrian has the option to extend the charter for a period of one year. The Genco Constantine has the option to extend the charter for a period of eight months.

(2) Time charter rates presented are the gross daily charterhire rates before third-party commissions ranging from 1.25% to 6.25%. In a time charter, the charterer is responsible for voyage expenses such as bunkers, port expenses, agents' fees and canal dues.

(3) For the vessels acquired with a below-market time charter rate, the approximate amount of revenue on a daily basis to be recognized as revenues is displayed in the column named "Net Revenue Daily Rate" and is net of any third-party commissions. Since these vessels were acquired with existing time charters with below-market rates, we allocated the purchase price between the respective vessels and an intangible liability for the value assigned to the below-market charterhire. This intangible liability is amortized as an increase to voyage revenues over the minimum remaining term of the charter. For cash flow purposes, we will continue to receive the rate presented in the "Cash Daily Rate" column until the charter expires.

(4) These charters include a 50% index-based profit sharing component above the respective base rates listed in the table. The profit sharing between the charterer and us for each 15-day period is calculated by taking the average over that period of the published Baltic Cape Index of the four time charter routes, as reflected in daily reports. If such average is more than the base rate payable under the charter, the excess amount is allocable 50% to each of the charterer and us. A third-party brokerage commission of 3.75% based on the profit sharing amount due to us is payable out of our share.

(5) We have reached an agreement to charter the vessel for 10.5 to 13.5 months at a rate of $36,000 per day, less a 5% third-party commission and commenced on January 4, 2010.

(6) We reached an agreement to enter the vessel into the Baumarine Pool with an option to convert the balance period of the charter party to a fixed rate, but only after June 1, 2009. We exercised the option to convert the balance period of the charter party to a fixed rate on June 3, 2009 at a gross rate of $20,742 per day. We further reached an agreement to charter the vessel for 10.5 to 13.5 months at a rate of $20,000 per day, less a 5% third-party commission. The vessel is expected to enter into the time charter following the completion of its previous time charter on or about January 16, 2010.

(7) We entered the vessel into the Bulkhandling Handymax Pool with an option to convert the balance period of the charter party to a fixed rate, but only after January 1, 2009. We extended the charter party by an additional 5 to 7.5 months starting November 5, 2009. In addition to a 1.25% third-party brokerage commission, the charter party calls for a management fee.

(8) We extended the time charter for an additional 35 to 37.5 months at a rate of $40,000 per day for the first 12 months, $33,000 per day for the following 12 months, $26,000 per day for the next 12 months and $33,000 per day thereafter less a 5% third-party commission. In all cases, the rate for the duration of the time charter will average $33,000 per day. For purposes of revenue recognition, the time charter contract is reflected on a straight-line basis at approximately $33,000 per day for 35 to 37.5 months in accordance with U.S. GAAP.

(9) We have reached an agreement to enter these vessels into a spot pool managed by Lauritzen Bulkers beginning at the expiration of their current time charters in August 2009. Under the pool agreement, we can withdraw up to three vessels with three months' notice until December 31, 2009 and the remaining two vessels with 12 months' notice. After December 31, 2009, we can withdraw up to two vessels with three months' notice and the remaining three vessels with 12 months' notice.

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 35 drybulk vessels, consisting of nine Capesize, eight Panamax, four Supramax, six Handymax and eight Handysize vessels, with an aggregate carrying capacity of approximately 2,903,000 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 include, without limitation, statements with respect to the commencement of time charters and 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 the following: (i) changes in demand or rates in the drybulk shipping industry; (ii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iii) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (iv) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (v) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, repairs, maintenance and general and administrative expenses; (vi) the adequacy of our insurance arrangements; (vii) changes in general domestic and international political conditions; (viii) 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; (ix) the number of offhire days needed to complete repairs on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims including offhire days; (x) the Company's acquisition or disposition of vessels; and other factors listed from time to time under "Risk Factors" and other sections of our public 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, 2008 and its subsequently filed reports on Form 10-Q and Form 8-K.

SOURCE Genco Shipping & Trading Limited