PANL - Earnings call transcript Q1 2021 | Pangaea Logistics Solutions, Ltd.

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Operator

Good morning. My name is Chrystelle and I will be your conference operator today. At this time, I would like to welcome everyone to the Pangaea Logistics Solutions First Quarter 2021 Earnings Teleconference.

Our host for today's call are; Mr. Ed Coll, Chairman and Chief Executive Officer; and Mr. Financial Chief Signore, Del Officer. Gianni being Today's for will available and beginning call at is replay XX:XX be recorded A.M. Eastern Standard Time. ID The dialing recording XXXXXXX. referencing XXX-XXX-XXXX by number domestic or can XXX-XXX-XXXX International be accessed and muted lines live a and All session. currently after prepared will question-and-answer remarks, the be there are Instructions]. [Operator is pleasure the to It floor Ms. to now my turn over Silva Partners. Sean from Prosek

Sean Silva

from Chairman you thank you Logistics morning's CEO, earnings XXXX quarter for Coll; and Financial for Pangaea this and are; Thank Officer, Del conference With Solutions. the Mr. Ed today Mr. us first and Signore. joining us company call Chief for Gianni

Before Act I This to conference over XXXX. of Private the Ed, Statement. read forward-looking contain I'd the statements within turn like the call could meaning Harbor Reform the Litigation Safe of to Securities

was X-K the on slides slide Logistics will light on in under update with Those at Filings supplemental assume based the subject and pangaeals.com attached Pangaea expectations uncertainties of to The that evening's risks from based facts. forward-looking the forth website are Solutions' the could filed are recall forward-looking accompany section Such cause in this in please that Company and Solutions fully information are this release, conference are SEC's found differ the Logistics of should be which to is beliefs sec.gov. the such herein understood Investors presentation risks set the Forward-looking statements risks. can any and of upon Commission. statements. Exchange to a last which available are statements be current filings management Securities or on Pangaea Pangaea historical the and that contained not with call. discussed more information results does actual obligation Solutions not Logistics Such statements to call. Also,

CEO, Chairman Now I Logistics to turn Coll. and like the to over Ed Mr. Solutions', call Pangaea would Ed?

Ed Coll

your families I us market. the This safe. overall are update And morning, and that who healthy an have and I'll hope to you all Thanks, operations joined provide and thanks today. Sean. our on

call more the turning quarter Gianni to CFO or of financials. overview provide a Before first the over to detailed

We presentation release issued We that were to hope last for accompany press and review time open then our which will evening. you've line questions. had

unexpected quarter results first drybulk in benefited the first Our from quarter an for increase XXXX. the market of

is As rates we've multiyear seen freight for to in usually drybulk. that quarter highs the week rise

generated $X.X results the compared per improved XX,XXX quarterly XX% loss average million TCE year-over-year quarter approximately day of earned million Our considerably first to our XXXX to as compared a XXXX. $X.X of of net net increased income the And we net quarter -- XXXX. -- first in of

in model maintain the to our changes. that reacting profitability client cargo, quickly helps by to we past, As such involved prioritizes us focused markets in said business

many average our quarter, quickly as of first still cargo both is and market of can in see, to in this to tends of instead rising the spot the for TCE fixtures TCE rapidly of we earned This highest market market. you normal lag earned averages. and lead a our even old a rapidly in rising the as this kind market, become profitable contracted outperform continue While premium years, resulted the the consequence is market over market. a smaller The are

to operated operating today, We XX chartered fleet. and we capitalize while of we're As quarter, on work the continued strategy. in adhering focused the a to of total owned of vessels fleet during started recovery in first to in as our approximately combined the market vessels show signs the to and position the XX improvement quarter, company

These which arrangements building purchases, XXXX new for annual new in the program, to almost the coupled built July. the soon Promise, and April, our to built capital of over which acquisition in expected deliver financing dead-weight will four secondhand bulk our will at our Courageous, us three XXXX to efficiency We which in the our operating to which market. and was Bulk be ships discuss timely to Pangaea, also will average an Gianni to steps also XXX,XXX tonnes timely Bulk quarter XXXX to be the the is July. Supermax last with post us deployed acquisitions. days this delivered shipping first another own delivered the expected on within effort Further, of our add built X,XXX opportune is fleet age, we're our announce year. time our These leverage expand increase vessel, in acquisition are and improve in happy these us fleet to dry night, to Panamax delivered

will Our in expected second be deliver both business delivered our this Arctic May, first to will new by July, building enter summer. the and cargo vessel

our for ships value in third The taken follow winter in the turn, platform that season. ways and race and to encouraged value. fourth summer for by or fall, ready customers, expand will enhance will the late add steps in we've we're be shareholder and to Collectively,

bulk look ahead, we the outlook the by As we're market. of encouraged dry

demand second reinstated from X,XXX commodity our approximately the favor all confident quarter, in We feel the rate trades per have as so low, container And And COVID-XX days ship performing. owner the market fixed the to an XX,XXX in our first quarter remain of has continue in the is far strategy that business financials. provide I'd the updating today, and now positive continued Gianni coming new We over to developing day. per in quarterly and globally. for to forward average our improving of we keep look TCE our best-in-class now. platform. to quarter. second have dividend services and orders following additional the building like the complements momentum for and the lockdowns New details when into shipping market vessels in The With we arise quarters. disruptions been opportunities $X.XXX share. in clients, acquire as new December, to looking to dividend today delivering that increase announced opportunistic an We'll turn We call on the to Gianni? be our on to developments and

Gianni Del Signore

today's you, for all Thank us thank Ed and joining you call. on

like recent financials, results to on expand for highlight transactions I'd our walking Before quarter. the few a and our through

As excited our recent interest leverage over active opportunistically Ed of possible. the we In April, million are for our recent efficiently deployed fleet our in in years resulted years. one Bulk about We've operating for more LIBOR renew our rate periods lender the as with on the acquisitions, of to as mentioned, we Courageous an plus capital $XX financing X.XX%. expand which existing Pangaea and with own seven an completed

existing vessels in senior of secured loan our finance the to This is million, new Further million lender refinancing the line for and an finalized class April, to payable also $XX lenders. We fixed payable signed of delivery four new six we a was we term $XX.X Bulk years expect over facility X.XXX%. six over in with years to at Panamax ice sheet which up X.X%, to Promise the plus close at with LIBOR vessel. interest

market revenues opportunistic Voyage XX% our approximately starting welcomed XX%. presentation, and resulted increased voyage charter on during which charter to quarter are both and improvement quarter revenues increases our of in page financials, the six in to increased rates, Turning time in first market approximately closely revenues. the tied and revenues, more the first

to a million. earned led expenses to ship of market an the paid of to $XX.X vessels of XXXX. Our in $XX,XXX increased owned to $XX,XXX chartering due increased same increases days operating and for which to sale $XX.X owners Charter first also sale XXXX chartering from for in TCE rates third-party to compared to The rates XX% period vessels vessels of $X.X vessel million decreased expenses, the million to decrease to XXXX. increase the due XX% in in quarter

for income was the or day quarter to on $X.XX was Excluding $X.X $X.X share million, a a Net or XXXX. loss per technical operating management for $X.XX $X,XXX. same the vessel fees, in per expenses period of compared per basis share million,

was to Moving following in sheet of presentation, cash and equivalents active and of flows liquidity have total maintain XXXX in the dividend on our of to acquisitions. activities per we mentioned, balance and for suspending cash we from quarter cash after $XX cash our investing as financing an end page this the $X.XXX decrease temporarily activities. operating investing since The due strong increased seven reinstated and million primarily to to vessel our Ed in share. dividend year quarter cash a position, over used ended quarter Further on quarterly

$XX the million to sheet, our of down Moving working moved debt quarter in class refinancing the the first balance the capital to current improvement was which vessels, four long-term. ice in of due

as market As the by capitalize and cargo we turn focus year, generate drive value. results of the you growth we continue to continue remarks the we Q&A to additional call see, over for to encouraged so improvements to we I now any Ed position shareholder far our company before strategy adhering to while call. our will this on to can are that, back With get will portion and

Ed Coll

Thank in the further quarters. for commitment you, and the We now coming thank we updating you their partnership. customers, floor Gianni. continued partners and shareholders for forward business look our to I'll open And questions.

Operator

Your with from [Operator question line comes first Market. Fratt Capital Instructions] Noble the Poe of

Poe Fratt

could or in trade that Gianni. potential seeing? morning, impact or Ed, higher if wondering, flows the rates higher was Good seeing Ed. shipping highlight changes Morning cargo that you I from Good either you're any we're any

Ed Coll

a logistically, flow want in now lot we've to that's into deliveries on the where multipurpose call you're used just things of example, of that floated into been of even are of that the that think time. hitting Poe But seen for containers it I completely lot and a same Well, That's in is, And ships. And wouldn't container market. storm. ship things cargo the messed the up a that carriers. one the bulk at taken perfect to course situation is time a I

you you that So on. -- going have that have

you everyone helps prices, You because certain you're a of commodity market. the logistics and large that out continued is lot of. very disruptions a take aware of And the market seeing increase have capacity congestion have have of also which and chain to the in

be many no one get a a for two, this that it. delivery no can't yard fact XXXX that? so ships going build ship, question because there's business. ordered. want looks year The about at the next if ships certainly can There's or the you build robust to you happens it's moment, till container in you things beyond it And know are So, like, from to what pretty really

the good on ships. We We have a age. own brought our runway down average

up pretty And pick has on that's our And site. been promising. things year good. good. pretty very timing pretty, We'll seven ships are this So owned the

Poe Fratt

need? specific then, additional acquisitions, an that about on at you've you digger the a or look there, identify how M&A super And Have see trying you Ed, out previously that talked side, when also Great. you've certain you opportunities just to trade talked do a you or Okay. the active identified you with been acquired? when about

Ed Coll

think I just customers there's have it, have another coming want in that, from very junk. yes, now sale, now quite comfortable that we mean, fruition, enough we that for And were won’t for business by regular we bringing -- you little there's the I problem bad ship, is, basic to except do our that's don't chefs.

as tempting that rising maybe do it's market a So it, in to style. as our not

difficult. if yeah owned day pretty piece. where right find continue would one low $XX,XXX with not business, gets can something, what's fleet, a I position, to -- a as now. but a that’s but that you good market right support this mentioned a not is And price going, it From available, – more thing is, good big the But, rise and I that's [ph] the good cost, to the then mean, a so The capacity. CR think and for that's roughly at we we're can survey we ship. -- intriguing. consider that's, it's and So I have good in it’s if more do think and we the I me, prices breakeven, and ship we very breakeven

car a find this, a And always market in for search we're to Sunday. your like grandmother week a looking a looking. basically that hard once but on that's You're drove to

Poe Fratt

right is -- that has are or you it now? some the older market profile, And assets, potentially enough, as fleet then or of age your your conversely comfortable with is good the stands Ed, sell it where you --

Ed Coll

in the think ships, have, order And it, most again, we're they, those low with in them we breakeven they even shape. ships are have okay and we ones we costs what -- of because I operate. our great know older have to need

you So the the This of with that is issue are numbers. get not dollar-for-dollar will benefit older it. round the ships out

but market that you oldest sell you the the not $XX million which So lot it old can that's of the to following you -- before, on it, more million, $X.X have it's if but you premium the money. to get you and And fleet, just will in is were let's say for an ship $XX a go rebuild to you have million, the would a make not say we ship, second-hand earnings, get might if of than dollar-for-dollar. costs

what of the a go is you ageing the if get So more terms to the the chain much curve go in we've top similarly value be very ships, modern value you best done will premium. down of and condition, modern, paying you very strong to

them. go with get wouldn't things I seller you money be a make best value. those keeping to those and wouldn't enough we across money pick board down up now, the So to ships by of more try the

Poe Fratt

you to know financing on potentially you on the that then but discard? that vessel? fairly And up Absolutely. it's Have have early, super be you named I to -- lined Gianni --

Gianni Del Signore

Yes.

currently Poe, did we're is Courageous the it'll it, on very working Bulk what my expectation and the on to but similar Bulk So Promise. look we

So think that's that a I think the her. we're expectation have position, our good relationships we that working And with with lenders. existing we're I on in

Poe Fratt

delta covered, you TCE. then could that's quarter XX,XXX, talk days healthy X,XXX about, first you And you that have your poured average Great. pretty if versus

rates? rates, your looking at should as drop seeing that maybe as the And And to you're If that in of X the a because XX, the outlook your delta of just on change offsets within chartered you running fleet, that comment or is expenses you're TCE then Are there especially understand two seeing owned second next million that how quarter? your an of about quarter-over-quarter. through to there much all going Will what we in help be fleet. in sort could you sort far there Can operating much. that cash, flow you be at the isn't then how of chartered so all off me quarter looks? for shouldn't and because delta to you're on owned

Gianni Del Signore

chartered think the the we always I that release of earnings was things it margins. but with going that we and had very year first the and fleet. my fleet. our to be one strategy opinion. still in can not our a The and strong don't Well, the market is that This extremely We on to make has so that judgment, healthy and turn chartered get are in we've will premium reactive, quite say, fleet charter business same, said changed the the and then chartered we margin good chartered, just be the

So not a problem. that's

things East with remember before. market happened of is market discounted it US coming outbound way actually the strong. And which actually I market. it's is normally into that's a extremely don't in from the Far the The the this it's One And softer. all business US, the seeing of the in the trade,

the front haul money now to getting more bring paid becomes backhaul you not. believe it the or like you're backhaul, when So in the

Supramaxes fix made from So XXs states it’s high on the the in east business to in. the you coming can

bit those in That's And it's its just where it's turned so market. head little -- live. that on live with We disruptions. we a

breakeven for So a eight situation. low ships, it's again in of us very we fleet. with And the with existing have our okay to jumping for terms that earnings

even premium, a premium summer, market. We a have that’s for coverage the today's contract to

quarter, business usually that's fruition. comes when So, into be a our very we and time It'll the into us. as for end get good third back

at this this I yes, the is way pretty excited point. we're So about think unfolding

Poe Fratt

existing your the fleet if own there Okay, you of make – realize from we you of that you hold not the any benefits – charters not look us standpoint any or back on that at market? or enable contracts and have full time would are Ed, could then maybe, the it to stronger

Ed Coll

or a put not charter. plain you to to – them do, tend nature. normally a or side second we ship it's to to, When keep leg on that No, know, our of position something we

have you ships And, provider. you period, ourselves. at We we where We don't a put So business. contracts as that. don't, them know, ships That's do we don't we're side not our we not long-term know, on own tonnage trade any generally all.

Poe Fratt

wouldn't expenses, quarter charter should higher – the Yes. because expenses And you expect charter and general? increase what higher the or market in then, over mind the like whether second if stronger you're charter in on we the in seeing first just quarter, commenting of

Ed Coll

generally in Yes. as has always Poe, that max. month a tend I market market charters, reacting think a see you We for six to to certainly improves, three but single strategy trip market. weaker charters, slight we are they to the I mean, increase, the shorter do charter our period will term, been

as as renewed. our far relatively it stable a as size, stayed fleet but charter So to fleet being renews, your are vessels point,

think cargo are we slight the do to But we or do – seeing lot things going be better, dedicated that's, COA, price, if market And look at it's holding chartering think assigned the to So consider – have the our we we'll strategy or our back will will think back. we it. I usually it what a other is is stay – it’s to improves. that’s increases, are of ship we par twofold. – our we stay to the and contracts us way because a book fixed on One,

the put and the into or well And And a that'll necessarily slaughter some positioned of a healthy and in usually COAs they these for backhaul that's we're will bookings. forward not pretty the able us, contracts, in other in in of charter us maybe one to vessel nature, but market, backhaul market.

we’ll still we of profit premiums. – look profitable. still – run, margin, we’ll make – be We’ll on that's at it. we’ll will a good we'll make how make And sort make a still still So the good

priced be or advance. But on second generally in month may comfortable, voyage, the nature and we of be we're to will able the a or our with a additional they yes, a capture quarter pretty that capacity. legs So year because third

Poe Fratt

maybe Great. about looking the really you make in do vessel last call, commitments. was And the -- And longer stronger calibrate and then is has the you think just last quarter, versus time about trying and think market you in of comments shifting sort at to from how visibility looking Ed, term market? Do good or improved? your I think away and trying are talked availability I the to shippers

Ed Coll

is part of do, would don't everyone very really but that I pathway. once and say, think at while, it. not we watch we on in what a looking -- people bullish ships will that's I And go take I that's longer period. see Well, see you

you'll short We're they so scramble, short and do quarter it's real realization And quarter the expected of the be guys. hasn't coming the first big A I of think going it. still see And great. in had everyone first it guys some because pass-through. that these to that may the they're lot in not But cargo the were to a into to first way. guys the -- clicked

for has more someone the ship, a it well, pay gets to if a customers. So costs just and lot pass-through then to that's what it

about And can market, the to correction some Are and at you you kind long have point, way a to a people long-term? buying have worry in -- risk. that counterparty out see of So in for a go you period, really. really that. they Not have get used if and you you in then would

why things. types to destiny try So of with we would to control our that's prefer own these

Poe Fratt

buying unwinding increase back, of it review, should then Great. also dividend about the been sort so? increase of there in is of the major talk considering if goal try And last the a could every year. or for then And is quarter-to-quarter about there been especially the six there's since dividend as we seller out far be as to maybe then shares it talk context it's weeks doing and you that increase and or whether sort lastly,

Ed Coll

longer selling, should price them think I where people think have share it they bit shares lot liquidity. be risen it at are creating volume it experience. we've shares think, I a been not lot But the be. holders, this opinion, sellers. and been they've a and to that our unwound And gets has that's more many in take I thought Well, would quite and our a the holders, -- of nearly coming The point, into more

cautious. to And that we feel we're that is And it we'll it. this. think sense see part change okay. think the can So I with dividends, it if I We to constantly do review makes

Gianni Del Signore

add out out of views further has the of to take shares And and just the Poe, reduce public there. not to buyback been and just on I more always market share on our sort think float share buyback, the liquidity the to

us, So it's consideration never been a for really historically.

So stock but think we may I that yeah, forward the depending we see on I think true, change still look how as trade. to that remains

Poe Fratt

Yeah, included was I the in public was context in that just thinking -- shares position. those they closely pretty were long hadn't generally of so standing they Yeah. people because just held float,

even So unwinding least buying back. I as potentially was shares they at you considered just some wondering, had if were

helpful. that's so Thank much. Great. you So

Ed Coll

Thank you.

Gianni Del Signore

Poe. Thanks.

Operator

no this call for are will I now the remarks. time. at to turn questions back There closing management further

Ed Coll

And thank all us taking to have the good time for morning. this day. everyone Well, very a you join

Operator

earnings concludes Thank first today's you. Solutions quarter Logistics This call. XXXX Pangaea

now may You disconnect.

Pangaea Logistics Solutions (PANL) 12 May 212021 Q1 Earnings call transcript