- Earnings call transcript Q3 2022

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, greetings, and welcome to the Pangaea Logistics Solutions Third Quarter 2022 Results Conference Call. [Operator Instructions]. It is now my pleasure to introduce your host, Noel Ryan from Vallum Advisors. Please go ahead.

Noel Ryan

Thank you, operator, and welcome to Pangaea Logistics Solutions Third Quarter 2022 Results Conference Call. me Del CEO, Petersen. Signore; with Financial Filanowski; call Gianni Officer, and the today Mark is Chief Leading COO, Mads discussion about statements contains and Today's expectations. financial future business forward-looking projected may in various significantly and the reports our including described uncertainties, results SEC. filed Actual from with risks today's statements the due differ forward-looking to in periodic risks those Except statements. update our as required forward-looking by law, we undertake no obligation to the of our prepared line open for conclusion will questions. the At we remarks, Mark. turn the And call with that, like to I'd to over

Mark Filanowski

welcome joining those and the on closed After we today. Noel, ended X for call you, Thank months to yesterday, us market XX, X months the XXXX. and September issued the results

performance, routes period transportation fleet culminated and of realized During broader year-over-year one quarter cash profitability, our adjusted volatility, EBITDA, in stable, in a of strong quarter rates contracts, diverse with in by long-term positions flow third TCE as portfolio index outperformed trade and larger operating of a highlighted another market leading XX%. owned market ice-class consecutive significant together our higher-margin growth by the

have largest we of those above-market that less exceed owner operator technical relationships trades. scale, support vessels demanding and returns regularly and globally, consistent of the to capabilities As contractual the

XX all the third Ice Arctic vessels Class XA active our During quarter, within trades. of modern were ice rate premium

quarter within third core Class strong contract Ice trades While solid, the summer in most typical experienced a levels our drybulk months, routes of during seasonal demand softness resulting was performance.

new for the current remains While our businesses. has environment it opportunities geopolitical volatile, created

area. the of more commodities distances. markets shipped ton-mile ports in to in non-Russian longer sub-capesize This We are is Coal from trades operate. result this areas. commodities we many Baltic where from anticipate year, may trade ice usual may in European worldwide import disruption especially that we and imports demand, to -- the continued drybulk export ice Our other ports Baltic

are ports cement and into the new take and of seeing are position as and With our handling such market. in commodities we U.S. increased to aggregates spending. We cargo support customer-focused, to approach of a in moving demand infrastructure fleet, great opportunities agile for shipping advantage efficient

remain specialized our to chain logistics company supply markets, drybulk leading offerings and services with niche returns. providing customers positions of premium commodity logistics Looking further of developing committed shipping, scale, and all to and us ahead, we a which deliver transportation in

acquisition, awarded Freeport, Bulk of were stevedoring and vessel, discharged to now contributing we XX,XXX port Northeastern currently this to to the fleet, provided and in During we to providers, supramax. expand XX approximately plant logistic collaborated deadweight of continuing services trades. and coal power operating own positively to operating worldwide offshore to cement a installation terminal a while super-sack labor newest service quarter, commissioning stevedoring our Brayton an our cable both October, in to operations license We and Sachuest at berth offering in the service is begin of the vessel addition our Somerset, a the at motor a vessel, a tons currently XX continued XX ships cash fleet transported for Massachusetts. new in total the we States. took income. farm existing Point is delivery Texas. operate own services Bulk and multiple provided We Sachuest, logistics third support in flow And XX,XXX to bags wind to In vessels third-party net United freight With XXX,XXX with tons customers, in operator we and in Texas. of of

than a blended balance XX% allow few more capital X.X%, the from long-term a of the of sitting well me words on we to Before environment. nearly interest to trailing our over are from year than debt debt million for million, third our less period. allocation. Gianni, rising at remarks, of quarter an We I turn and call sheet and X.Xx insulated share end, his fixed With increase EBITDA was ratio cash in of with down prior of XX-month $XXX the adjusted at third net the ago year versus to quarter period, X.Xx $XX equivalents rate ended rate while our the

Board generates. Directors considers constantly Our use business of our of the capital best

common reserves approved year dividend, quarterly in As in from such, to past $X.XXX $X.XX a our remain our Board to per allocation committed a the second balanced increase per has increase from share. quarterly our We includes share capital strategy, XX% hand stable opportunistic Gianni. that market organic targeted over protection dividend it expansion With in and for and investments I'll to swings. inorganic cash volatile and debt reduction, one growth initiatives, that,

Gianni Del Signore

all those of you, to us and welcome today. joining Thank Mark,

to Our as of the results expanded the model owned durability recognize continue expansion financial our ships third quarter able were to season. ice from sizable of arctic we during emphasize fleet business margin peak our

for was rates $XX.X EBITDA prior margins $XX of market during quarter. than more panamax by lower growth basis, supramax than charter grew total EBITDA COAs XX% or $X.X during in Third average flexible year-over-year due expenses to a chartered-in declined the which year. strategy, quarter. $XX.X hire building Despite long-term when of $X,XXX XA to million supplement quarter the own seasonal a demand fleet our of as operating the Ice XXXX. an the supported charter Bulk our were partially our our premium Class On $XX,XXX mainly published which and vessel The rates by versus adjusted Ice expansion a the to new vessels, of quarter third days in tonnage revenue net the management million with X The in by to TCE a our expenses the XX% the per driven operating a per Concord, decline offset in technical offset expenses, days was allowing were during on of QX TCE the X-month decline due more charter-in charter delivered from XX.X% by for even and in driven market The fleet and which to increase prevailing year-over-year million X.XX% demand. expenses acquisition short-term period million to is $XX.X meet the hire and to an per rates increase us to million rates by up post-panamax increase day, was day by fees, day. owned cargo basis, by revenue in declined XXXX; in during owned at in decrease needed adjusted declining Class vessel vessels

the and forward utilize long-term our selectively on contracts cargo to bunker As and forward agreements we've hedge cargo the discussed bookings. past, swaps freight we exposure in to our market

in while flows, locks unrealized of fluctuations in approach execution this of date. position physical and on the results occur While period-to-period basis, to can gains lead future a will at future the settlement reported cash the mark-to-market or a losses our

approximately the reported attributable $X.X or to year. total, fuel loss an the agreements reflects of on of forward unrealized share, Pangaea to million unrealized with of the relative our our interest a $X.X or was last quarter, rate our $X.XX of per associated for mark-to-market million As income the quarter derivatives. million $X.X decrease third million diluted reported approximately to on and million GAAP third quarter net of diluted bunker $X.XX $XX.X per an In approximately freight share unrealized gain net during such, relating swaps, an loss $X.X income

compared derivative well share income or other quarter adjusted during million million reported adjustments, of share, Excluding attributable to $X.X the third of per diluted or Pangaea impacts last as was per as to $X.XX of quarter non-GAAP the the our instruments $XX.X increase $X.XX net an the year.

cash Total to from year-over-year on $XX.X third cash XXXX. quarter operations Moving the of increased in flows. the million to XX%

As XXXX, total million. business including capped rate quarterly the debt lease we XX-month our Of strengthening In $XXX was balance of end as a capital generating XX% LIBOR performance and third our net total of trailing leases, dividend. is to adjusted to through plus rate returns generated $XXX.X our and investment the strong during at our result, is obligations, million of cash an in cash equivalents of the At X.X%, at for X.X%. sheet floating X.X%. all-in the an company debt and and efforts is third X% quarter continued in our finance expanding fleet, of model XX% quarter dynamic on finance EBITDA at had shareholders ratio all-in focus fixed debt, and X.Xx. conclusion, our the long-term

to Looking our shareholders. through that, the platform for pay liquidity while as been continue position stronger debt, asset-right down any vessel never we returns deliver growing With our our ahead, will renewals, consistent our floor to now open all has questions. to logistics to continuing we and businesses expand and stevedoring and acquisitions look

Operator

Instructions]. [Operator

Alliance from the of Our first Fratt question from line comes Global. Poe

Charles Fratt

fourth XX the right good Another conditions the about solid for, in about XX% cover at quarter, forward reasonably calculating you that, reasonably vessels third Is but good looks will market X,XXX if days the your in you're comment -- running please? on that I'm quarter, of now. quarter

Mark Filanowski

about that's right, Yes, Poe.

the book in the As how voyages we quarter, and this take they're measurement. in we quarter, performed earlier that's later

right those So you're in about estimates.

Charles Fratt

down And third quarter. the then costs mentioned charter-in you come in had

course You're right what give the idea flavor Can back you more the now? in the the of higher chartered Is range up can has a how or over of us Or in couple XX. because market us vessels chartering rates? the just to current off, $XX,XXX own now maybe in cost give chartering the your of you're the it cost at for about now last charter-in so? and XX an along in quarters your right is is you of fallen just sort -- lines fleet of

Mads Petersen

Poe. Hi, here. Mads It's

cheaper replace the of fleet can mean chartered we the sense, sort drop, I model right. with and in part absolutely as the the that in of You're markets that business is redeliver tonnage. flexible

trade. a hard positional So say we course, on you average. in but through sure, now cost have range and on depending it probably bit trend, and progressed route right. the what XX,XXX It's for, That's need seeing are quarters, XX,XXX the of for that is ship what the to as little very the depending our probably on of we chartered-in is to is Yes. to sort

Charles Fratt

sorry, you hello, frame. the will understanding any specific you in that should Mads, season the quarter have or is time into there just quarter? the is My would generally ice to -- of of third but the goes said it -- sort is impact And October I fourth

Mads Petersen

-- has sort course, well. as mid-November, season. the bit a completing actually the winter and on premium sort -- for little we're early is of on that Canadian November, the October start start during of doing the part voyages business late St. already the December, like the of eastern of We the a premium it's course, Canada. of business to that there it also collect of to Lawrence And of in that component the are especially in So from

a of there. is bit there QX little So premium

Charles Fratt

then, And should stability sort give of sort us an One we policy And forward? investment Great. of it be the drybulk create helpful. ratio? and balance dividend there's opportunities, highlighted Okay. your thinking the of you've highlighted color your payout and dividend buildup said you've Is quarter-to-quarter, you're target the know sort in you like on up. to more Or secondly, strength, going idea in dividend policy -- a be just market. in talk of about dividend the how the a just versus looking you cash, going stevedoring past port I logistics of would it's sheet things? how about Mark, you at any areas the whether the then -- the Can dividend can past the couple is

Mark Filanowski

dividend. Why of profit. pretty and with consistently markets. been bad and markets. out continually consistent number approach outperformed indexes reported address don't and in always dividend It's not years, been good Throughout terms so good put performance We've good through dividend the the we've the market sustainable of company the to markets in our I a markets

I think but shareholders. same So cash to we we're cautious, approach, the want of generating dividend, the when share it have comes we with to some

we do it So carefully through dividend. the

consistent. more We little Maybe volatile to formulaic be bit our little consider that date, dividend. we a too wanted against to a to a do haven't, bit plan

And the if We're sure $X.XXX, cash the after will And it past, keep with to we $X.XX. consider adjustments. months when consistently number forward, I the dividend other over restarted Board the or generating so right increased what, so But we've started I'm that out looking think, XX we now we comfortable we're generating, pretty it's and now. COVID. at up

we low think in investments In market bit forward, we At little the terms of see of forecast. I going least for rates FFA see are a XXXX. weakness pretty

we've go. see I think pick wait on an ship S&P we'll where at got we'll way we maybe market up look the opportunity, X, values depending see the and is. or the cash a some sit And hand, and market, if which on

on so investment. done In side we've what we've far, terms of accomplished capital logistics with logistics, little relatively the

of would in We on next so. doing are, couple though, bigger a maybe or today us little that projects focusing than different the on be that step XX something a side months

Operator

Instructions]. [Operator

from question comes Alliance from Global. Our the line Poe next of Fratt

Charles Fratt

I have just might talk I the asking, would you or maybe can might but asset about have -- said X. you kept -- Genco that Mark, call. might market depending what on thought just on from S&P an over you flipped Liam -- does, the pick off What

this going potential can Newport to in the quarter first have you that coming up a the point have tell Newport what Is the do at candidate? you of just me You with you're survey. you -- a in XXXX with think time? sales Or

Mark Filanowski

able in Poe, we'd It to become start or twice and just more at older bit the is kind little reinvesting maybe makes chips going sale age, in to is of kind candidate ship available. some the efficient propulsion ship that's than an when ship, ask that flow [indiscernible] for whether the forward, will more forward ship, future it that longer. our of hand potential ship on that what comes the twice, in least we ship the looking cash ourselves new a -- fall whether hold trade sense of something terms shouldn't a we of it whether, ship [indiscernible] at assuming investing Rather want especially be will do, to a we always of eco be cash to maybe wait now

Charles Fratt

or or than look just what like what bit you on you that. the little of bit then, -- sort a $X,XXX the looked talk OpEx fourth Okay. Can the on like And might little Gianni, XXXX a higher gave quarter under should X run basis it's have line? the OpEx, months third either that. just about It quarter like

Gianni Del Signore

quarterly third And Poe. more, by But Sure, look presenting of quarter basis. we're onetime It Yes. that I on seeing basis. sometimes like when cost the a at year-to-date on impacted in itself a some don't we I it know is think, reflective costs. OpEx what I was

As Bernhard our you managers to technical from know, we changed Schulte. Sovcomflot

is quarter We're inflationary think I that that our were part incurred some pressure. the As up. more were of operating reflective. that certainly some during changeover, expenses there costs drove But third seeing the year-to-date

number think year-to-date, reflective travel to number of it's year. balance going the the some is by year, for will really the X% year We're I expect But onetime the -- was compared prior we about think of changeover. events. really And crew an increase. is more affected some into that seeing and QX next what increases I for year-to-date probably in

Operator

hand Since Filanowski, questions, CEO, I over Instructions]. are like the now Mark [Operator there comments. to your no further for to would closing conference

Mark Filanowski

day. rest Thank have great the you a all attending, and for of

Operator

Thank concluded. for now conference your The has you. you Thank participation.

lines. disconnect You your may now

Pangaea Logistics Solutions (PANL) 10 Nov 222022 Q3 Earnings call transcript