Euroseas Ltd. (ESEA) Q4 2024 Earnings Report, Transcript and Summary

Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Conference Call on the Fourth Quarter 2024 Financial Results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. [Operator Instructions] I must advise you that this conference is being recorded today. Please be reminded that the company announced their results with a press release that has been publicly distributed. Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the Federal Securities Laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. I kindly draw your attention to Slide 2 of the webcast presentation, which has the full forward-looking statement and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. And now I would like to pass the floor to Mr. Pittas. Please go ahead, sir.

Hello, everybody, and good morning. Thank you for joining us today for our scheduled conference call. Together with me is Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the three- and 12-months period, ended December 31, 2024. Let's turn to Slide 3 of the presentation to go over our income statement highlights. For the fourth quarter of 2024, we reported total net revenues of $53.3 million and a net income of $24.4 million or $3.49 diluted. Adjusted net income for the quarter was $23.3 million or $3.33 per diluted share. Adjusted EBITDA for the period was $32.8 million. Please refer to the press release for the reconciliation of adjusted net income and adjusted EBITDA. Our CFO, Tasos will go over our financial highlights in more detail later on in the presentation. As part of the company's common stock dividend policy, our Board of Directors declared a quarterly dividend of $0.65 per common share for the fourth quarter of 2024, increasing by $0.05 the quarterly dividend, given throughout last year. The dividend will be payable on or about March 18 to shareholders of record on March 11. The annualized dividend yield of our stock, given the current share price is approximately 7.8%. Additionally, the company is dividend off to all of its shareholders, the shares of Euroholdings Ltd., a subsidiary owning our three eldest vessels, which represents about 5% of our NAV. The shares will be distributed on March 17 to all shareholders of record on March 7. As of February 27, 2025, and since the initiation of our repurchase program in May 2022, which has been extended since twice to May 2025, we have repurchased 425,000 of our common stock in the open market for a total consideration of about $9.25 million. We will continue to make measured use of the plan at management's discretion depending on the level of our stock price, aiming to enhance long-term shareholder value. Please turn to Slide 4, where we discuss our recent developments, including an update on our sales and purchase chartering and operational highlights. On January 7 and January 8, 2025, we took delivery of Motor Vessel Dear Panel and Motor Vessel Symeon P, respectively. These are 2 Eco EEDI Phase 3, 2,800 TEU feeder containership newbuildings that were built in Hyundai Mipo Dockyard in South Korea. The vessels were financed through a combination of bank debt and no funds as usually. Following their delivery, both vessels commenced charters with a duration of 36 months at a daily rate of $32,000 per day. Continuing on our chartering developments, Motor Vessel AEGEAN Express has been fixed for a minimum of 10 months and up to 12 months at a rate of $16,700 per day with the earliest delivery being in November 2025. Additionally, Motor vessel Synergy Keelung and Motor Vessel Synergy Antwerp have been fixed for 36 to 39 months at $35,500 per day. Finally, Motor Vessel EM Hydra secured a charter for 24 to 26 months at $19,000 per day, with the earliest delivery expected in May 2027. Throughout this period, the fleet experienced no idle periods or commercial off-hire except for Motor Vessel Diamantis P, which underwent necessary maintenance works for 23 days from December 16, 2024 to January 8, 2025, ensuring that the vessel can continue trading efficiently until the next dry docking date. Please turn to Slide 5. On January 3, 2025, we contributed our 3 older vessels, Motor Vessel Aegean Express, Motor Vessel Diamantis P and Motor Vessel Joanna into a separate company, Euroholdings Ltd in exchange for 100% of the shares of Euroholdings. Subsequently, Euroholdings sold Motor Vessel Diamantis for net proceeds of about $13 million. Therefore, Euroholdings as of the end of January had cash of about $13 million, plus owned Motor Vessel Aegean Express, which is on chart at $16,700 per day till minimum November '25 and Motor Vessel Joanna, which is on charter until minimum October 2026 at $16,500 per day. Euroholdings will dividend out the Euroholdings shares to its shareholders, providing every shareholder on record on March 7 with one Euroholdings share for every 2.5 Euroholdings shares in the Euroholdings shares. Distribution will occur upon effectiveness of the registration statement and is expected to occur on March 17. Simultaneously, the shares will start trading on the NASDAQ. Further details of the distribution will be provided in a subsequent press release. Whilst the regulatory clearance and listing processes are practically completed, there can be no assurance that the transaction will ultimately occur as if a material event occurs before the final implementation date, either the SEC or the NASDAQ may not finally sign off. Please turn to Slide 6 for an update on our current fleet profile. Our current fleet is comprised of 24 vessels in the water, including 17 feeder containerships and 7 intermediate container carriers with a total carrying capacity of just under 71,000 TEU and an average age of about 13.5 years. Following the contribution of the two vessels, MV Joanna and Aegean Express to Euroholdings, our fleet will be reduced to 22 vessels in the water with a carrying capacity of approximately 67,500 TEU and an average age of 12.8 years. Turning to Slide 7. You can also see the two vessels that are currently under construction, which are expected to be delivered in the fourth quarter of 2027. These are two 4,300 TEU vessels. Let's now turn to Slide 8 to see our full vessel employment chart. As you can see, the recent charters helped improve the visibility of our expected cash flows, and we have now secured strong charter coverage over the next two years with approximately 85% of our fleet fixed for 2025 and about 49% fixed for 2026. Let's move to Slide 10 for our broader market overview, focusing on the development of 6 to 12-month time charter rates over the past 10 years. In the fourth quarter of 2024, containership charter rates experienced a slight decline, except for the larger segments where they held their levels. As is seen from the graphs on the slide, as of February 21, 2025, the 6- to 12-month charter rate for 2,500 TEU containership reached approximately $32,500 per day, which is more than three times the $9,400 [ph] per day median rate. Notably, this fixture is also significantly higher than the 10-year average rate, which is approximately $16,500 per day. This positive trend is observed across all vessel sizes with the current rate significantly outpacing historical averages, highlighting the market's robust recovery and resilience. Moving on to Slide 11, we go over some further market highlights. As already shown during the last quarter of 2024, feeder vessel rates decreased by 9%, while the rates for Panamax and post-Panamax vessels rose. The Red Sea region continues to be a key factor in shaping the 2025 containership outlook. While the Gaza ceasefire has eased some tensions, the ongoing Houthi threat remains and shipping lines may begin reducing via the Suez Canal. However, they will require clear evidence of a permanently reduced risk before making the shift. In the fourth quarter of 2024, average secondhand prices increased by approximately 7% compared to Q3 2024. While prices have risen significantly since the past COVID period, they still are about 50% below the peak levels they had reached during the pandemic. Also, the newbuilding price index increased by just 1% quarter-on-quarter, but still an increase, which is due to limited availability and increased competition between yards, particularly for eco units and larger feeders. As of February 10, 2025, the idle fleet stood at 0.2 million TEU or just 0.6% of the fleet. Recycling activity picked up just slightly with 58 vessels accounting for 83,000 TEU sent to scrap starts during 2024. Given that about 25% of the sub 8,000 TEU fleet is over 20 years old, we expect the recycling volumes to increase if market conditions soften. Scrapping prices eased slightly in Q4 to approximately $490 per lightweight ton, but still remain around 20% above 2019 levels. Overall, the fleet grew in 2024 by a staggering 10.8%. Please turn to Slide 12. The IMF's latest update from January 2025 projects stable yet somewhat underwhelming global economic growth with unchanged forecast from that in October 2024, hovering around levels -- similar levels for both 2025 and 2026. Undoubtedly, the new US administration's rapid policy changes and reversals, particularly concerning trade policies and geopolitical conflicts collectively pose risks to medium-term growth prospects. Within this background, the US has seen an upward revision by the IMF with growth forecast trending to grow at 2.7%. This stands in stark contrast to other advanced economies, particularly in Europe, which have seen either downgrades or stagnant growth outlooks at around 1%. Emerging markets continue to drive global growth led by India, the ASEAN 5 countries and of course, China. China's growth appears to be slightly revised upwards, but in an lopsided fashion with projections of 4.6% this year and 4.5% next year as the country continues to face certain domestic demand, persistent inflationary pressures and finally -- and falling property and equity markets. India is projected to maintain steady economic growth of 6.5% in both 2025 and 2026, driven by strong investment activity, robust agricultural performance and continued expansion in the services sector, which remains a key engine of economic growth. Southeast Asian countries are also positioned for solid growth, benefiting from regional demand and investment momentum. Global inflation is expected to decline. However, the near-term trajectory may still face challenges with persistent services and wage inflation in several parts of the world, leading to the synchronized monetary policy responses. The risks to the global inflation now outlook will be tilted to the upside given the prospect of increased protectionism, geopolitical tensions, derisking, and demographic constraints. According to Clarksons, the container demand outlook for 2025 remains murky with many variables at play. In its latest market report, Clarksons projects trade growth to decline by 1%. This is attributed to factors such as U.S. tariffs, ongoing geopolitical risks in the Red Sea and despite the Gaza ceasefire that persisting threat, making a return to normal shipping operations more challenging. Looking into 2026, the containerized trade demand is forecast to decline even further by 3.9%, with further potential for a demand/supply imbalance due to continued fleet growth and the possible easing of the Red Sea disruption. In light of this, we remain mindful that both the IMF and Clarksons projections could change depending on macroeconomic risks, U.S. trade policy and evolving geopolitical tensions, which could impact medium-term growth prospects. Please turn to Slide 13, where you can see the total fleet age profile and containership order book. The containership fleet is relatively young with most vessels under 15 years old and only 11% of the fleet over 20 years old. As of February 2025, the order book as a percentage stands at 27%. Turning on to Slide 14, we go over the fleet age profile and order book only for ships in the 1,000 to 3,000 TEU range, the sizes we mostly operate in. And there, we see a very different picture. The order book here stands at just 3.2% as of February 2025. According to Clarksons, in 2025, new deliveries are projected to amount to just 2.1%. This pace will slow down even further in 2026 and 2027 with even fewer ships expected to be delivered. You can also notice that about 15% of the fleet in this size range is over 15 years old. Let's move to Slide 15. As shown in the previous two slides, the order book is predominantly focused on large containerships. The increase in main lane volumes inevitably drives greater demand for regional distribution by feeder vessels as well. Thus, we believe that there will continue to be quite high demand for feeder and intermediate-sized vessels despite a cascading effect, of course, which pushes towards the use of larger ships when this is possible due to port capacity improvements and increased volume requirements. This category of ships is, however, aging extremely rapidly and currently, the percentage of vessels exceeding 20 years is on average about 27%. All these ships are prime candidates for scrapping in case there is a market decline also due to the new environmental regulations. Thus, it is highly likely that the fleet capacity in these segments will decline in contrast to the anticipated growth in the larger vessel categories in the overall fleet. Moving on to slide 16. As already discussed, container shipping markets saw substantial gains in 2024, with both freight and charter rates reaching levels not seen since the COVID period. However, in recent weeks, freight rates, particularly on the East/Europe route, have dropped sharply, due to expectations of the rerouting through the Suez Canal following the Gaza ceasefire. This shift has yet to be reflected in the time charter market. Looking ahead, in 2025 and beyond, the container shipping market development is very uncertain, primarily driven by two factors: geopolitical risks and trade war-related issues. While the Gaza ceasefire has prompted discussions, it remains uncertain when shipping lines will resume the routing through the Suez Canal. On the trade war front, the anticipation of U.S. -- of higher U.S. customs duties under the new Trump administration, has led to a surge in early orders, driving up freight rates. This is now reversing. The 10% tariff on Chinese goods and the 25% tariff on goods from Mexico and Canada set to take effect in March 2025, if that happens, plus tariffs on Europe yet to be determined and the recently announced fees on Chinese built and owned vessels entering U.S. ports. All these -- we remain to see how these controversial actions could lead to slower global growth. Anyway, their full impact remains to be seen as they may also trigger additional inefficiencies, which may create opportunities as often happens in shipping. On the supply side, vessels ordered by shipping companies in the post-COVID years are now entering the market in large numbers. This trend, as discussed, is expected to continue in 2025 up to 2028, and based on cargo volume forecast, many of these vessels will likely struggle to fill their capacity. If the factors currently supporting the containership market begin to fade, the market downturn could be quite swift. However, potential reductions in vessel speeds, driven by efforts to reduce emissions and support green initiatives, may help ease supply pressures and contribute to market stability. The energy transition has continued to gain traction in the container sector. Although, there is a clear shift towards adopting new fuels, the pace of this transition is likely to be slower than anticipated due to technical and economic hurdles. Meanwhile, the premium for charter rates of eco-friendly vessels is expected to grow as both charterers and the industry as a whole become increasingly focused on sustainable transport solutions. Please turn to Slide 16. The left-hand slide graph depicts the strengthening in the containership market throughout the year. As of February 21, 2025, one-year time charter rate for 2,500 TEU containerships stood at $32,500. New building prices also picked up a little bit during the fourth quarter and into the beginning of 2025, reflecting consistent demand driven by the limited shipyard capacity, the rising construction costs. Over the long-term, elevated costs for green technologies and stricter emission standards are expected to keep new building prices -- are expected to help keep new building prices high. Similarly, secondhand vessel prices have increased from a low of $15 million in late 2023 to $31 million by December 2024, supported by the improving market sentiment and the robust charter demand. In this environment and with our very strong cash position, we continue to look at opportunities that will help us grow the company and enhance shareholder returns. And with that, I will pass the floor over to our CFO, Tasos Aslidis, to go over our financial highlights in further detail.

Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next four slides, I will give you an overview of our financial highlights for the fourth quarter and full year of 2024 and we will make the related comparisons to the same periods of last year. For that, let's start by going to slide 19. For the fourth quarter of 2024, Euroseas reported total net revenues of $53.3 million, representing an 8.7% increase over total net revenues of $49.1 million during the fourth quarter of last year. And that increase was mainly the result of the increased average number of vessels we operated in the fourth quarter of this year compared to the last. We reported net income for the period of $24.4 million as compared to net income of $24.7 million for the fourth quarter of 2023. Interest and other financing costs for the fourth quarter of 2024 amounted to $3.7 million, of which $0.56 million relates to interest income, imputed interest chart and capitalized in relation to our new building program, compared to $2.5 million for the same period of last year, of which $0.26 million relates to imputed interest chart capitalized in relation to our new building program for that period. This increase is due to the increased amount of debt we had in the current -- compared to last. Also interest income during the fourth quarter of this year was $0.8 million, compared to $0.5 million for the fourth quarter of 2023. Adjusted EBITDA for the fourth quarter of this year increased to $32.8 million, compared to $32.4 million for the corresponding period, the fourth quarter of 2023. Basic diluted earnings per share for the fourth quarter of 2024 were $3.51 basic and $3.49 diluted calculated on about 7 million weighted average number of shares outstanding, respectively, compared to basic and diluted earnings per share of $3.58 and $3.56 per share basic diluted for the fourth quarter of 2023, which was calculated on the basis of about 6.9 million shares -- weighted average numbers of shares outstanding. The adjusted earnings per share for the fourth quarter ending December 31, 2024, were $3.35 per share basic and $3.33 per share diluted compared to adjusted earnings of $3.62 and $3.61 per share, basic diluted respectively, for the same period of last year. I will refer you to the press release we issued earlier today for a reconciliation between earnings and adjusted earnings. Let us now look at the numbers for the corresponding full year period of year 2024 versus 2023. For the full year of 2024, we reported total net revenues of $212.9 million, representing a 12.4% increase over net revenues of $189.4 million during 2023, again, mainly the result of the increased number of vessels we own and operated, partly offset by the lower average time charter rates we earned in 2024. We reported net income for the year of $112.8 million as compared to $114.5 million for the 12 months of 2023. Total interest and other financing costs for 2024 amounted to $10.6 million, of which $4.2 million relates to interest income interest charged and capitalized in relation to our new building program compared to $6.4 million for 2023, of which 3.2 million is interest income. So the total interest expense was $9.8 million included interest related to the interest charge and capitalized in relation to our new building program. Again, this increase is due to the higher amount of debt we carried in 2024 versus 2023. Interest income in 2024 was about $2.4 million versus $1.4 million in 2023 as a result of the higher cash balances we maintained during the year. Adjusted EBITDA for 2024 increased to $135.8 million compared to $123.6 million during 2023 as a result of higher revenues and almost 10% increase. In terms of earnings per share, in 2024, basic earnings were $16.25 and diluted $16.18 calculated both approximately $7 million -- $6.9 million and $7 million, respectively, basically diluted weighted average number of shares outstanding compared to $16.53 and $6.52 per share basic diluted for the 12 months of 2023. The adjusted earnings for the year of 2024 were $14.92 basic and $14.85 per share diluted compared to $14.99 and $14.98 for 2023. Again, our release -- our press release earlier today shows the exact reconciliation between earnings and adjusted earnings. Let's now move to Slide 20, to review some figures from our fleet and our fleet performance. Starting first with our utilization rate and first for the fourth quarter. During the fourth quarter of 2024, our overall utilization rate was 99.6% compared to 99.9% overall utilization rate for the fourth quarter of 2023. Last year, in the fourth quarter, we operated 23 vessels, earning an average time charter equivalent rate of $26,479 per day compared to 19 vessels in the same period, the fourth quarter of 2023, earning on average $29,266 per vessel per day. Our operating expenses, including management fees and G&A expenses, but excluding drydocking costs were a bit lower in the fourth quarter of 2024 compared to the previous year and stood at $7,728 per vessel per day in the fourth quarter of 2024 compared to $7,932 per vessel per day for the same period in 2023. At the bottom of this table in this section of this table, we can see the cash flow breakeven rate, which also takes into account drydocking expenses, interest expenses and loan repayments. Thus, for the fourth quarter of 2024, our daily cash flow breakeven rate was $14,935 per vessel per day compared to a bit above $15,000 for the same period of 2023. Let's quickly look now at the same numbers for the full year. During the full year of 2024, overall utilization rate was 99.7% compared to 98.6% for 2023. For the whole year, we operated on average 21.7 vessels, earning just above $28,000 per day on average compared to 18.3 vessels for the whole year of 2023, earning on average about $29,700 per vessel per day. On the cost side, on the operating cost side, for the full year, again, including running expenses, management fees and G&A, but not including dry docking costs, we average $7,526 per vessel per day in 2024 compared to $7,875 per vessel per day in 2023, showing an improvement of about just below 5% improvement on the cost side. The cash flow breakeven rate for 2024, including, again, the interest expense -- cash interest expenses, drydocking expenses and loan repayments was about $14,800 for 2024 compared to $14,150 in 2023. The increase partly due or mainly due to higher drydocking expenses and a little bit higher interest expenses. At the bottom of this table, we can look at the -- at another line, which shows our common dividend expressed in dollars per day per vessel and in both on the quarterly -- for the last quarter and for the full year. So in all cases, our interest translates to around $2,000 per vessel per day for the fourth quarter of both 2023, 2024 and about $2,100 per vessel per day for the respective full years. Let's now move to Slide 21, to review our debt and our debt profile. As of December 31st, 2024, our total debt stood at approximately $208 million and that figure does not include about $52 million of additional debt that we assumed in January -- in early January 2025 to finance the delivery of our last two 2,800 TEU newbuildings. Including this latest $52 million in our loan book, in 2025, we expect loan repayments of about $24.4 million and additionally, balloon repayments of about $16.25 million. In 2026, we have scheduled repayments of about $19.5 million with no balloon payments due during the year. In 2027, we have to pay -- we have to make payments -- loan payments of $16.85 million, along with scheduled balloon payments of $20 million. As of the end of last year, our senior debt carried an average margin of 2.1%. Adding that to a base rate of about 4.3%, this results in total cost of debt of around 6.4%, because we have swapped part of our debt -- part of our SOFR exposure for a lower SOFR level, our adjusted overall debt cost amounts to about 6.34%, under these assumptions of SOFR. And if we actually include in the averages, the last two loans that I mentioned earlier, that were -- that they serve a smaller margin over SOFR, the overall cost of our debt, including those loans drops below 6.3%. I would like to draw your attention finally on this slide at the bottom of the slide, where we present our projected cash flow breakeven for the next 12 months and we break it down in its components. But overall, we expect our cash flow breakeven for 2025 essentially to be around $12,600 per vessel per day, a level that is significantly below the average daily earnings of our fleet. To conclude my brief remarks, let's move to Slide 22 to review some highlights from our balance sheet as we do every time. Our balance sheet is very simple. It includes cash and some other current assets, advances we paid for our newbuildings and of course, the book value of our assets in the water. Thus, as of December 31, we had cash and other current assets of about $90.3 million, while we made advances for our newbuilding program near $57 million. And we also have the book value of our assets, which is about $443.4 million, resulting in total book value of our assets in our balance sheet of $590.6 million. On the liability side, we had debt that stood, as I mentioned in the previous slide, at $207.3 million as of the end of last year, and that represents about 35% of the book value of our assets. We also had various other liabilities that amounted altogether about $18 million of about -- or about 3% of the book value of our assets, which leaves as a book value of our shareholders' equity about $365 million, give or take, or around $52 per share. However, it is important here to note that the charter adjusted market value of our fleet is significantly higher than its book value. We estimate as of the end of last year, the charter adjusted market value of our fleet to be about $130 million higher than its book value. That adds about $20 per share to our net asset value, bringing our net asset value per share to close $72. On a pro forma basis for the Euroholdings spin-off that Aristides mentioned earlier, as of December 31, we exclude the value of the assets that has been contributed to Euroholdings after the spin-off of those -- of that company, we will have to adjust our NAV by about 5%. So the NAV after the spin-off, we expect to be around $68.2 per share. In either case, for after the spin-off, given that our stock is currently trading around $34 per share, you can see a significant, a substantial discount -- you can see that we trade a significant discount to our net asset value, highlighting the substantial upside potential that our shares have and the gains that would be expected for our shareholders and investors. And with that, I would like to turn the floor back to Aristides to continue the call.

Thank you, Tasos. Let me now open up the floor for any questions we may have.

Thank you. We will now be conducting a question-and-answer session [Operator Instructions] One moment please for your first question. Our first questions come from the line of Mark Reichman with Noble Capital Markets. Please proceed with your questions.

Yes. While we haven't removed the two vessels from our estimates yet, I mean, it seems pretty safe to do so. And the question is regardless of whether the distribution occurs on March 17 or even July 17, Euroseas’ income statements for the -- will be based on the drop-down as of January 8. Is that correct?

Yes.

Okay. Thank you.

Yes.

And second, the expected scheduled off-hire days, including the laid up, what are your expectations for 2025?

I think we have 50 days a quarter. Does that seem...

I think we have very little dry dockings because that is really what the off-hire is only when we have a dry dock because commercial off-hire we're not having these days with the high charter rates. And technical breakdowns, you can calculate 1 day per quarter to be pretty safe. So it all depends on dry dockings, and we have extremely few dry dockings this year.

I think we're budgeting about 70, 75 days for dry dockings in 2025.

70 to 75 for the full year. Well, that's reflected in your projections here on your breakeven. I mean you have very little expense in there for dry docking. And then just the last question. The rate for the M/V Oakland, it looked like it increased to $42,000 from $35,500. And you've got the Emmanuel and the Rena, which are both similar intermediate vessels, which come up for recharter in, I believe, in April. Would you kind of expect a similar rate as to the Oakland for those vessels?

I don't think the Oakland has increased. I mean the 42,000 on the Oakland has been getting it for quite a long time. Current market is at 35,500, which is what we did on the Synergy and the Synergy moved just 2 or 3 weeks ago. So this is the current market for those ships. These ships, they don't open up yet. So charters are waiting a little bit to see how the market develops. And we have to see how we -- we will be able to fix them. But current market is 35.5 is what we did on our near [indiscernible] vessels.

Okay.

Year charters – 35.5

Okay.

Yes, that's for three years. If we do a shorter duration, it will be probably a higher rate, but we would like to fix for a longer duration.

Okay. And so -- and this is the final question. If the distribution happens on the 17th, would that mean Euro Holdings first day of trading would be the 18th?

I think we have to get back on you on that, but I believe the 17th would be the first day of trading. There will be some when issue trading possibilities even before that. But we will probably -- we will issue a release clarifying these technicalities.

Okay. Thank you very much.

Thank you.

Thank you, Mark.

Thank you. [Operator Instructions] Our next questions come from the line of Poe Fratt with Alliance Global Partners. Please proceed with your question.

Hello, Aristides. Hello, Tasos.

Hi, Poe.

Tasos, can you -- well, one, Aristides, I'd like to compliment you because you always not only do a thorough overview of the containership market, but also it's a very measured one, which I really appreciate. You highlight a lot of the things that potentially could go wrong, but I really appreciate that. Tasos, but could you, Tasos, talk about fourth quarter OpEx G&A per day, it looks like it was over $1,000. You're forecasting about 35% lower than that going into the first quarter. And was that because of the spin-off? Or can you just highlight any maybe unusual G&A expenses that happened in the fourth quarter?

Yes. I mean, typically, our fourth quarter has a little bit bump on the G&A is not so much on the expense for the spin-off, but there is a year-end bonus that certain -- the company pays that is reflected in the fourth quarter numbers.

Okay. Great. And then as you mentioned, you're going to report the first quarter with -- ex the spinout, correct? Just from a modeling standpoint?

What's going to happen is that we would start to include -- I mean, Euroseas will include the Euroholdings vessel up to the date of the actual distribution. So I think it will include earnings from Euroholdings up until March 17, assuming that is the distribution date. So we will have those extra vessels, but we will provide an adjusted earnings to reflect the continuing fleet. Because what we are distributing a very small percentage we will not have to report historically -- we won't have to adjust historically the results of Euroseas to reflect the continuing of. I mean it was very different in the EuroDry case seven years ago. In this case, it will be like you are selling the vessel, so providing dividends. So the formal accounting numbers will include the two of the three vessels up until March 17. They will include the capital gain from Diamantis also on Euroseas, but we will provide some adjustment and some explanatory.

Okay. So it's going to -- the first quarter is going to be a little noisy. And just a little bit of a nitpicky thing. But in your time charter chart, the fleet profile, it shows the Antwerp is not having any follow-on work after March. I just want to make sure and confirm that, that also was awarded a three-year time charter at $35,500 just like the Keelung?

Yes. I mean the way -- I mean, I have in front of me the slide from my computer though, not from the version that we said on the web, and it does shower having 35,500 until May 2028.

Okay. Yes, in your press release -- it's just over there. But can you just highlight how much you're going to spend on the newbuilds in 2025 and 2026 and 2027, if you have those numbers handy?

I have -- I think -- I don't think we have any payments to do on 2025.

Correct. Correct. So it's nothing on 2025.

And I think the next time we pay is 2026, and I will tell you momentarily. So we make -- we have to make an installment -- progress installment payment in the fall -- in the third quarter of 2026 and then the remaining in 2027 for one of our vessels and the same for the other one, I believe, yes.

And installment -- I'm sorry.

There will be $6 million a vessel in 2026. So, $12 million -- nothing in 2025, $12 million for both vessels in 2026 and the remaining in 2027.

Great. Thank you so much.

Thank you. [Operator Instructions] Our next questions come from the line of Mark Reichman with Noble Capital Markets. Please proceed with your question.

Yes. I just wanted to clarify. So the first quarter 2025, when you report, so those two vessels will be in your earnings, until March 17, it won't be based on the drop-down date. It won't be based on the January 8. And then, so that would also -- you mentioned some adjustments. What were some of those adjustments that will...?

I think we will provide the figure without those vessels as well.

With and without the vessels, okay. Great. All right. That’s very helpful. Thank you very much.

Thank you. [Operator Instructions] Our next questions come from the line of Poe Fratt with Alliance Global Partners. Please proceed with your question.

Sorry. Just two quick ones, if I may. Well, first of all, congratulations on increasing the dividend. And then secondly, can you just talk about stock buybacks, Tasos? It looks like you -- the last time you reported in the third quarter versus the fourth quarter, you bought back about 11,000 shares at just under, I think, $40. Can you just talk about stock buybacks and how they -- what priority they are in your capital allocation process?

Aristides, you want to answer that one yourself...

So, obviously, we've been more involved with all the procedures and the practicalities of getting Euroholdings over the bar, and we're happy that we have reached that point. We will have to wait and see how we trade after the spin-off. But it is always something that we have in mind and we might use. We have also been looking at various investment opportunities because indeed, we have quite a lot of cash. So unless we proceed with an investment opportunity with buying an asset supported by a time charter or whatever. If we feel that our share price doesn't respond as we are hoping it will, we might be using it again, yes.

I mean in any event, our shares probably represent the best investment opportunity, and we always have that in the back of our mind when we decide about capital budgeting. Q – Poe Fratt: Great. Thank you so much.

Thank you [Operator Instructions] I'm not showing any further questions at this time. I'd now like to hand the call back over to Mr. Aristides Pittas for any closing remarks.

Thank you all for being part of this discussion today. We will be back to you in three months' time to go over Q1 results. Thank you very much. Bye-bye.

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.