The stocks of shipping firms including Euroseas Ltd.(NASDAQ:ESEA) gained after Korea Line Corp. won the Hanjin Shipping Co. assets. The shipping division is ripping supersized up move after Korea Line fetched the assets of Hanjin out of a bankruptcy law court in Seoul. This decision could further have a remarkable impact on Asia-to-U.S. shipping prices.
The financial performance
Euroseas posted its financial report for the three-month period closed September 30, 2016. In 3Q2016, total net revenues came at $7.2 million while net loss was $4.6 million. Net loss attributable to shareholders after a dividend of $0.4 million on Series ‘B’ Preferred Shares came at $5 million. Adjusted net loss linked to common stockholders for the quarter was $0.401 per share. Adjusted EBITDA came at $0.3 million.
The Company announced its eleventh dividend amounting to $0.4 million on its Series ‘B’ Preferred Shares. The payout was done in-kind by releasing additional Series ‘B’ Preferred Shares. Aristides Pittas, the CEO and Chairman of Euroseas, said that in early September, they cancelled the second of Ultramax newbuildings following excessive construction delays. In addition to other Ultramax contract terminated in June, they have requested and are looking for return of their deposits and other costs plus interest as stated in the newbuilding deals and assured by refund agreements.
On the operating aspect, the markets remain tough. Both of the market division Euroseas operate in, continue to be at depressed levels irrespective of a modest recovery in drybulk charter rates. Also the idle fleet is growing and the containership rates stay depressed. They have extended the employment for three of their containerships whose charter was completing, however one more has been idle for nearly two months.
As the company is moving into the cyclically slow season, they have reported to lay the vessel up till the time market improves, which will help Euroseas save on costs.