Greetings, and welcome to the Diana Shipping Third Quarter 2024 Conference Call and Webcast. At this time, all participants are in a listen-only mode. As a reminder, this conference is being recorded. It is now my pleasure to turn the call over to Edward Nebb, Investor Relations. Please go ahead, Edward.

Thank you, Kevin, and thanks to everyone who is joining us today for the Diana Shipping Inc. 2024 third quarter conference call. With us today from management is Ms. Semiramis Paliou, Chief Executive Officer, who will introduce the other members of the management team. Without further ado, I will turn the call now over to Semiramis Paliou. Please go ahead.

Good morning, ladies and gentlemen. Welcome to Diana Shipping Inc. Third Quarter 2024 Financial Results Conference Call. I am Semiramis Paliou, the Chief Executive Officer of the company. It is a pleasure to address you today alongside our esteemed team: Mr. Ioannis Zafirakis, Chief Financial Officer and Chief Strategy Officer; Mrs. Maria Bevez, Chief Accounting Officer; and Mr. Dave Vander Linden, Chief Commercial Officer of Steamship Shipbroking Enterprises Inc. Before we begin, I kindly remind you to review the forward-looking statements on page four of the accompanying investor presentation. The third quarter of the year has been a tale of two markets. Capesize vessels maintained their relative strength, averaging higher returns significantly than in the previous quarter, while the smaller segments weakened. This disconnect has persisted throughout the year but became more pronounced as the market struggled with the steady flow of Kamsarmax and Ultramax newbuildings. That said, we successfully secured period deployments for nine vessels during the quarter, achieving an overall average rate higher than their previous fixtures. Turning to slide five, let us review our company's snapshot. Diana Shipping Inc., founded in 1972 and listed on the New York Stock Exchange since 2005, operates a fleet of thirty-eight dry bulk vessels, seven of which are mortgage-free. Our fleet has an average age of eleven years and a total deadweight capacity of approximately 4.2 million tons.

We anticipate the delivery of two methanol dual-fuel newbuilding Kamsarmax dry bulk vessels at the end of 2027 and early 2028, respectively. Fleet utilization reached 99.7% in the nine-month period of 2024, highlighting our effective vessel management. As of the end of September, we employed 984 individuals at sea and onshore. Financially, our net debt stands at 7% of market value, supported by $186.8 million in cash reserves and total secured revenues of approximately $135.3 million as of November 19th.

On slide six, we outline the key developments from the third quarter through November. In July, we issued $150 million senior unsecured bonds that are listed on the Oslo Stock Exchange, maturing in July 2029, with a fixed coupon of 8.75%. The net proceeds were used to refinance the company's $125 million senior unsecured bond due in 2026. The approval and publication of the company's prospectus for the bond listing on the Oslo Exchange was completed in July. We signed a term loan facility with Nordea Bank, secured by ten vessels, drawing $167.3 million to refinance two existing term loan facilities. This refinancing released two previously financed vessels. In October, we entered an $80.2 million seven-year secured term loan facility with Danish Ship Finance, maturing in April 2031, secured by seven vessels. This proceeds refinanced our existing loan with Danish Ship Finance, releasing two previously mortgaged vessels. In November, we completed a $25 million cap issue under our outstanding senior unsecured bond due July 2029, issued at 102% of par value with a fixed coupon of 8.75%. This puts the total outstanding amount of the 2029 bond to $175 million. As of November 19th, we have raised $25.5 million through the exercise of 6,381,900 warrants under our ongoing warrant program, with the potential to raise an additional $64.9 million under the full scope of the program. As of November 19th, we have secured revenue for 78% of the remaining ownership days of 2024, amounting to approximately $22.1 million, and 38% of available ownership days in 2025, amounting to approximately $95.8 million. Ioannis will provide further details on our cash flow generation potential. Earlier this month, we released our 2023 ESG report, the fifth in a row, underscoring our ESG strategy and commitment to sustainability. For the quarter ending September 30th, 2024, we are pleased to declare a quarterly cash dividend of $0.01 per common share, totaling approximately $1.3 million.

On slide seven, we summarize our current chartering activity. Since our last earnings presentation, we have secured favorable time charters for nine vessels: three Ultramax vessels at a weighted average daily rate of $14,539 for 379 days; five Panamax, Kamsarmax, and Post-Panamax vessels at a weighted average daily rate of $12,664 for 155 days; and one Newcastlemax vessel at $26,800 for 699 days. Slide eight highlights our disciplined chartering strategy. We focus on staggered medium to long-term charters to avoid clustered maturities, ensuring earnings visibility and resilience against market fluctuations. Now, I will pass the floor to Ioannis for a detailed financial analysis.

Thank you, Semiramis. We will go through the financial highlights for the third quarter of 2024. Our time charter revenues have decreased by approximately $5 million from the third quarter of 2023, from $62.1 million to $57.5 million for the third quarter of 2024. Net income has been $3.7 million, compared to $7.4 million in the same period in 2023. The good thing about our highlights is that we have managed to increase our cash and cash equivalents, time deposits, and restricted cash to $186.8 million. Today, as we speak, the number is much higher. That was as of September 30th, compared to $161 million in December. The long-term debt has gone down from $642.8 million to $627 million. Looking at our balance sheet, as we shared earlier, we have managed to be in a position to have our net debt compared to 7%, as we have already said. Financial and other data show that in this quarter, our time charter equivalent has dropped to $15,353, compared to $15,800 in the same period last year. The operating expenses have increased to $5,904, compared to $5,621 in the same period last year.

Looking at the nine-month period, the same numbers show the time charter equivalent rate has gone down to $15,162, compared to $17,230 for the nine-month period last year. The daily expenses have increased to approximately $5,900 from approximately $5,700. Having said all of the above, looking at our current debt profile and generally speaking, our balance sheet, we think that we are in a very good position. One of the indicators of that is our debt profile, as you can see in this slide. We have managed to have no maturities up to 2029, which gives us a very nice profile. Cash flow-wise, thanks to our strategic actions, at the bottom of this slide, you can see how well the debt decreases, and we end up in 2029 with slowly getting to lower and lower numbers. Next slide, we go to the breakeven investors' estimated revenue. We still have some days that have not been fixed for 2024. But if we assume based on the FFA rates that we have fixed dates for around $15,000, that will bring us to a time charter equivalent rate of $16,765, which is going to be around $650 per day for all of our vessels. As regards 2025, more or less, we think we are going to be very close to our breakeven if we take as an assumption the current FFA rates. Having said all of these things, if we move to Slide number fourteen, we have just declared a dividend of one percent, but since the third quarter of 2021, we have never missed a dividend payment. The intention is to keep that in the future as well. Having said all of these things, now it is time to pass the floor to our Chief Commercial Officer of Steamship Shipbroking Enterprises, Dave Vander Linden, for the market overview.

Thank you, Ioannis, and welcome again to all participants on this call. For a brief market update, a recurring theme during this year's conference call has been the important role geopolitical developments have played in the shipping industry. The third quarter of this year has been no exception. Rerouting of dry bulk vessels away from the Red Sea remains in focus, with Suez Canal transits hovering at about 40% less compared to the second half of 2023. Clarkson's estimates that the Red Sea disruption has impacted about 1.2%. However, the Chinese economy has continued to struggle, with the property sector being the biggest drag on economic growth. So far, there has been little impact on imports, even though demand has been weakening. The continued imports coupled with lower domestic demand have led to a significant buildup of commodity inventories. Having said that, the Chinese government seems determined to support the economy via several stimulus measures. As can be seen from the graph on this slide, twelve-month time charter levels unusually peaked in Q1 this year. That being said, Q3 levels were resilient on the back of increased congestion in South America and a steady cargo flow.

Moving to the next slide for some macroeconomic news. The IMF forecasts that the global economy will grow by 3.2% in 2024, and by 3.3% in 2025. The IMF reports a weaker outlook for China, Latin America, and the EU. The Chinese economy is projected to grow by 5% in 2024, 4.5% the year after, and by 4.1% in 2026. These forecasts, however, have not considered the recently announced stimulus package in China involving the raising of debt to support the economy. For the Eurozone, growth predictions are a mere 0.8% this year, and 1.2% in 2025. The IMF prediction of GDP growth in India is 6.5% for next year, while for the U.S., the prediction is 1.9%. For a brief commodities update, according to Commodore Research, global steel production, excluding China, is beginning to contract. According to Braemar, year-to-date global steel production stands at 1.25 billion tons, which is nearly 2% lower than at this time last year. Having said that, the World Steel Association is predicting a pickup of more than 1% in 2025. Regarding iron ore, Clarksons expects this trade to remain flat both in 2025 and 2026 at around 1.6 billion metric tons per annum. It is understood that iron ore inventories in China stand at a ten-year high of around 160 million tons. Clarkson's projected coking coal volumes are also remaining steady for 2025 and 2026 at 275 million tons per annum.

As regards thermal coal, the projection is for volumes to drop to 1.037 billion tons next year, which should be around 2% compared to 2024, and to 1.025 billion tons in 2026, which would be another 1% down over 2025. The 2025 grain season is expected to grow to 552 million tons, which is an increase of 2% compared to this year. While for 2026, grain trade might reach 565 million tons, which will be another 2% increase. The biggest growth we expect to see is in minor bulks. Trade in minor bulks is expected to grow by 3% in 2025 and reach 2.3 billion tons, with another 2% increase in 2026, reaching 2.341 billion tons, supported mainly by growth in the bauxite and manganese ore trades, as well as an increase in cement and pet coke volumes, as global construction activity is expected to pick up. Moving to Slide seventeen, covering fleet development. The overall bulk carrier order book stood at the end of October at around 10.3%. The order book for Capes and above continues to be the smallest of all types of bulkers, with 29.5 million deadweight tons, which represents about 7.5% of the current trading fleet. The order book for Kamsarmaxes is 36.7 million deadweight, which is about 14% of the current fleet, and the order book for Ultramax vessels stands at a little less than 30 million tons, about 12% of the current fleet.

If you look at projected deliveries, according to statistics prepared by Braemar, the Capesize fleet is expected to grow by about 5 million deadweight tons in 2025 and 6 million in 2026. For Kamsarmax, the figures are 9 million deadweight tons next year and 14 million the year after. Ultramax vessels are expected to grow by 10 million in 2025, and by 7 million in 2026. All these figures are net of expected deletions from the fleet. According to Clarkson's, only 5.2 million deadweight tons worth of bulkers are expected to be sold for scrap this year. For 2025, the figure is expected to reach 9 million deadweight tons, and in 2026, it is expected to exceed 14 million tons deadweight. New environmental regulations are expected to drive many ships to the scrap yards. Ship demolition decisions are primarily driven by the state of the freight market, sentiment, and age. For Capes and Supramaxes, the years 2010 through 2012 were the highest delivery volumes we have seen for a long time. For Panamax and Kamsarmax, the peak delivery years were 2011 through 2013. This means that a considerable number of vessels will soon become fifteen years old, which particularly for Capes is a crucial age barrier as regards the cost of a third special survey and the ability to charter to the main players in the dry bulk market. According to Clarkson's, 24% of Handymax and Ultramax tonnage is fifteen years or older, as well as 26% of Panamaxes and 17% of Capes.

Newbuilding prices of Capes, according to Clarkson's, have moved so far this year by over 14%, whereas newbuilding prices of smaller ships have seen rises about half of that. Recent weakness in the charter market has seen some asset values come down from the peak levels earlier this year. Five-year-old Kamsarmaxes are now around $34 million, and ten-year-olds are around $25 million, which is down double digits. For Capes, five and ten-year-old ships' secondhand prices have decreased by at least about 2% from their peak and stand now at around $63 million and $44 million, respectively. Ultramax five and ten-year-old values are currently around $33 million and $24 million, respectively. Turning to Slide eighteen for the outlook. According to Fearnleys and Clarkson's, positive factors for 2025 are the following: continued import growth into the Indian subcontinent, the possibility of a strong Brazilian soybean season, increased congestion and slower speeds, recent stimulus measures in China, and continuing risk for the Red Sea transit. Possible negative factors for 2025 are worldwide lower iron ore consumption, protectionist measures leading to trade wars, steel production outside of China falling back, fleet growth outpacing demand, and the easing of tensions in the Middle East, which could result in more Red Sea transits.

Considering the entire picture of headwinds and boosting factors for the dry bulk trades, Clarkson's project a slight easing for bulk carriers' earnings in 2025, as ton-mile demand is expected to grow about 1.3% versus a supply growth of around 3%. For 2026, Clarkson's predict a cautiously positive outlook for the bulk carrier market. Even though dry bulk demand in ton-miles is expected to grow again a little over 1%, supply is projected to grow again by around 3%. They foresee impacts from environmental policies to remain in focus, with new regulations having a range of positive impacts for supply and demand. Also, slower operating speeds, longer dry dock stays, and demolition of older units should help the market going forward. Dipco influencers regard as a positive factor the Simandou iron ore project in Guinea, which starts production in late 2025 and will gradually contribute to longer shipping distances of high-quality iron ore into 2026. Looking even further ahead, BHP Billiton states in their latest economic and commodity outlook report that population growth, urbanization, the infrastructure of decarbonization, capital stock replacement, and rising living standards are expected to drive demand for ferrous and non-ferrous metals, as well as fertilizers, for decades to come. I will now pass the call back to our CEO, Semiramis Paliou, to provide the most important financial highlights and takeaway points from our quarterly earnings call.

Thank you, Dave. Before concluding today's presentation, I would like to highlight our ongoing ESG initiatives. Diana Shipping Inc. is committed to promoting eco-friendly technologies and modernizing our fleet. We are committed to transparently sharing emission data to ensure accountability, building on partnerships and collaborations to advance our sustainability goals, developing an equity, diversity, and inclusion program, and continuously investing in our people. Moving on to slide twenty, to summarize, Diana Shipping Inc. stands on a strong foundation built on over fifty years of industry expertise and nearly twenty years on the New York Stock Exchange. We have a consistent management team adept at addressing industry challenges, strong stakeholder relationships, and a disciplined strategy. We maintain a solid balance sheet with a strong cash position and a countercyclical mindset. Our ongoing fleet modernization efforts, robust ESG strategy, and focus on rewarding our shareholders when possible are key priorities. With that, thank you for joining us today. We now look forward to addressing your questions during the Q&A session.

Thank you. We will now be conducting a question and answer session. Our first question today is coming from Clement Mullins from Value Investors. Clement, your line is now live.

Good afternoon. Thank you for taking my questions. I wanted to start by asking about your minority investment in four CS. Can you provide an update on when the vessels are expected to be delivered and whether you expect any additional CAPEX for these vessels? And secondly, could you talk a bit about how these vessels will be employed, be it on term contracts or in the spot market?

Okay. This is Ioannis speaking. Our total commitment on those vessels is €50 million, and we have already paid around €33 million of those. We expect to pay the other €15 million soon. The delivery of those vessels is scheduled to be by the first one by September 2025, and a vessel after every three months. Regarding employment, we have not secured any employment yet, but if we were to share a preference, we prefer to enter long-term employment.

That's helpful. Thank you. I also wanted to ask about your capital allocation priorities. Could you talk a bit further about how you plan to balance fleet renewal, deleveraging, and shareholder returns going forward? And secondly, is there any appetite to potentially repurchase shares given the discount you are trading at?

Having been listed since 2005, we have shown to everybody how disciplined we are regarding the questions that you have asked. Be certain that we will do what we have to do at the right time in the cycle. But being more specific regarding your questioning, unfortunately, I cannot be more specific. Renewal of the fleet will happen at the appropriate time. And, of course, we have shown in the past that, again, at the appropriate time, share repurchase can happen. The bigger picture for everyone is to look at our balance sheet and see that all of your questions have prepared the company to have the option to be able to do these things, but it has to happen at the appropriate time. So to cut the long story short, the answer to your question is indirect. We have the means of doing what you have asked. As regards to asset allocation, we are not in a position to respond.

Alright. Makes sense. That's all for me. Thank you for taking my questions.

Thank you very much for the question.

Thank you. We have reached the end of our question and answer session. I would like to turn the floor back over for any further or closing comments.

Once again, thank you for joining us today, and we look forward to speaking to you again at one of our next financial results calls. Thank you very much.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.