Friday, August 05, 2022
Genco Shipping (GNK)
Results rise even as the company takes steps to position itself for the future
Genco Shipping & Trading Limited, incorporated on September 27, 2004, transports iron ore, coal, grain, steel products and other drybulk cargoes along shipping routes through the ownership and operation of drybulk carrier vessels. The Company is engaged in the ocean transportation of drybulk cargoes around the world through the ownership and operation of drybulk carrier vessels. As of December 31, 2016, its fleet consisted of 61 drybulk carriers, including 13 Capesize, six Panamax, four Ultramax, 21 Supramax, two Handymax and 15 Handysize drybulk carriers, with an aggregate carrying capacity of approximately 4,735,000 deadweight tons (dwt). Of the vessels in its fleet, 15 are on spot market-related time charters, and 27 are on fixed-rate time charter contracts. As of December 31, 2016, additionally, 19 of the vessels in its fleet were operating in vessel pools.
Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Genco Shipping reported 2022-2Q results above our estimates but below consensus estimates. Net revenues were $100.9 million vs. $76.0 million last year, above our $97.1 million estimate but below the consensus estimate of $109.1 million. Adjusted EBITDA for the quarter was $64.2 million, up 28% but below our estimate of $67.1 million and the consensus estimate of $67.4 million. Net income was $47.5 million ($1.10 per share) vs. our estimate of $43.6 million ($1.01 per share) and the consensus estimate of $50.5 million ($1.17 per share).
Why were costs up? Daily vessel operating expenses were $7.358/day in the second quarter versus $5,151/day last year. The company is switching technical management companies. The changeover required higher repair and maintenance costs and an increase in the purchase of stores and spare parts. In addition, the company completed an entire crew changeover as ships came into dock. The good news is that the changeover is largely complete and vessel operating expenses are expected to drop to $4,950 in the upcoming quarter….
This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
