Thank you for standing by, ladies and gentlemen, and welcome to the EuroDry conference call on the first quarter 2022 financial results. We have with us today Mr. Aristides Pittas, Chairman and Chief Executive Officer, and Mr. Tasos Aslidis, Chief Financial Officer of the company. At this time, all participants are in listen-only mode. There will be a presentation followed by a question -and -answer session. At which time, if you wish to ask a question, please press star and one on your telephone keypad and wait for an automated message advising your line is open. I must advise you that this conference is being recorded today. Please be reminded that the company announced its results with the press release that has been publicly distributed.
Before passing the floor over to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, EuroDry 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 the current management's expectation that involves risks and uncertainties that may result in such expectation not being realized. I kindly draw your attention to slide two of the webcast presentation, which has the full forward-looking statements, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. I would now like to pass the floor over to Mr. Pittas. Thank you. Please go ahead, sir.
Good morning, ladies and gentlemen. Thank you all for joining us today for our scheduled conference call. Together with me is Mr. Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the three-month period ended March 31st, 2022. Please turn to slide three. Our income statement highlights are shown here. For the first quarter of 2022, we reported total net revenues of $18.3 million and a net income of $10.5 million. Adjusted net income attributable to the common shareholders was $9.5 million, or $3.3 per share. Adjusted EBITDA for the period stood at $12.7 million. Our CFO, Tasos Aslidis, will go over the financial highlights in more detail later on in the presentation. Please turn to slide four for our operational highlights.
Motor Vessel Ekaterini's charter has been extended until February 2023 at 105% of the average Baltic Kamsarmax Index, while Motor Vessel Xenia's charter has also been extended until March 2024 at a 105% of the average Baltic Kamsarmax Index. Motor Vessel Alexandros has been fixed for a trip of about 20-25 days at $29,000 a day during the quarter. It was fixed at $26,250 per day for the next 20-25 days, and thereafter it was fixed for about 55-65 days at $28,000 a day.
Motor Vessel Pantelis was fixed for also an approximately 20-25 days trip at $18,250 per day, and thereafter it was fixed for 80-100 days at $20,500 per day. The Motor Vessel Tasos was fixed for 557 days at $18,750 per day, and thereafter it was fixed for about 90 days at $20,600 per day. The Motor Vessel Molyvos Luck, which was delivered to the company on February 11th, 2022 , was fixed at $25,750 per day for a minimum period of ten and a half months and a maximum of thirteen and a half months.
Finally, Motor Vessel Starlight was extended at a 98.5% of the Baltic Panamax Index for a minimum period until October 2022. As previously announced, on April 19th, 2022, the company acquired Motor Vessel Santa Cruz, a 76,000 deadweight Japanese-built dry bulk vessel built in 2005 for $51.75 million. The company also assumed the existing charter of the vessel at $14,800 per day until July 2022. The acquisition was financed with own funds, and the vessel was delivered to the company on April 20, 2022. Regarding the dry dockings, Motor Vessel Pantelis incurred a seven-day repair, while Motor Vessel Starlight went into dry dock for 27 days.
During the quarter, the company was also active on the FFA market and sold 90 days of forward freight agreements, the equivalent of one Panamax vessel at a rate of $28,000 per day. Please turn to slide five to see the summary of our current fleet. The company's operating fleet has increased to 11 units. Our current fleet has an average age of 13.5 years with a carrying capacity of about 800,000 deadweight tons. Let's move to slide six, which shows the current vessel employment schedule. As you can see, fixed rate covers for the remaining of 2022 stands at about 30%. This figure excludes the six ships on index charters which have secured employment but are open to market fluctuations.
Moving to slide seven, we shall go over the market highlights for the quarter ended March 31st, 2022 up to now. Despite the challenging global economic and geopolitical and environmental environment during the first quarter of 2022, dry bulk rates remain at healthy levels. As seen here, the average spot market rate for Panamax ships was approximately $21,400 a day in the first quarter, and by March 25th the price had increased to $28,500 per day. Overall, the BPI index started picking up towards the end of the quarter as increased ore and coal quantities were shipped and increased ton-miles in grain trades were noticed due to the Russia and Ukraine conflict which offset, of course, the decrease in grain trades from those areas. Please now turn to slide nine.
Global growth is expected to slow significantly in 2022, largely as a consequence of the war in Ukraine and the pandemic in China. In its latest report, the IMF logged its previous global GDP estimates from 4.4% growth to 3.6% for this year and from 3.8% to 3.6% in 2023. A deep contraction is projected for Russia due to the sanctions and also European countries' decisions to scale back energy imports. A sharper than expected slowdown in China remains a key risk to growth for emerging markets, but its impact will depend on the drivers of such slowdown as well as the ensuing policy reaction. Prospects for emerging markets and developing economies are also generally for lower growth in 2022 than in 2021.
From the developed economies, Japan and the ASEAN-5 should do better than 2021. Citing tighter Fed policy and an anticipated halt to any further stimulus spending by Congress, the IMF has reduced its growth forecast for the U.S. for 2022 by 1.7% to 3.7%. Looking at the dry bulk trade and according to Clarksons' research, demand is expected to grow by 2.3% in 2022 compared to 4.6% for the previous year. For 2023, we expect dry bulk trade to grow at a moderate pace of 2.5%. Trade and growth projections are being continuously revised as the effects of geopolitical tensions between Russia and Ukraine on world growth and trade are being continuously assessed. Please turn to slide 10.
The order book as a percentage of total fleet up until May 2022 stands at 6.6%, which is around the lowest levels we've seen in the last 25+ years. Now please turn to slide 11 for our dry bulk fleet overview. While Clarksons expects new deliveries of about 3.1% of the current fleet to be delivered in 2022 and 2.8% in 2023, they expect a net fleet growth of around 2% during 2022 and below 1% in 2023, after also taking into account scrapping, slippage and other possible removals. New vessel ordering continues to be muted given concerns over environmental regulations and as a result, supplies should remain tight for the foreseeable future. Please turn to slide 12 where we summarize our outlook in the dry bulk market.
As previously mentioned, the Ukraine-Russia war adds to uncertainty and inflation while widening of lockdowns in China causes a delay in the easing of global supply bottlenecks and the normalization of supply demand imbalances. We expect earnings to remain volatile at high levels as the short and medium-term outlook are generally positive and supported by one of the lowest order book ever and disruptions from port congestion on changing trade flows. Indeed, demand has been affected lately due to a number of factors, including changes in trade flows due to reduced production levels in China, resulting in lower steel production, as well as reduction of bulk exports originating from Russia and Ukraine. However, alternative trade routes are increasing ton-mile demand for coal and other dry bulk commodities as they shift away from Russian ports. Overall, fundamentals remain positive for 2022, bar any immediate severe recession.
While many unknown factors like congestion easing, effect of the war on demand and the introduction of new regulations will play a dominating role in creating the forward supply and demand balances. Ordering for new ships for 2023 deliveries is expected to be non-existent due to lack of available slots in shipyards. In addition, the lack of clarity for the fuel of the future remains an unknown, something that makes placing a new order, even for the later of the delivery, a very risky option. On the other hand, normalization of trade routes and congestion easing will probably increase effective supply at some point. Please turn to slide 13. The left side of the slide shows the evolution of one-year time charter rates of Panamax dry bulk vessels since 2002.
As of the end of last week, the one-year time charter rate for Panamax ships with capacity of 75,000 deadweight tons stood at $27,125, having recovered from the big drop we saw at the beginning of the year. On the right-hand side of the slide, you can see the historical price range for a 10-year-old Panamax vessel, which has a current price of around $28 million. This is the highest of the last decade. Over the past year, dry bulk prices have gradually been increasing, exceeding the historical median and average levels. However, prices have still been significantly lower than what we have seen in the beginning of 2008.
While continuing to reap the benefits from the current strong charter market, we are also closely monitoring market developments for any opportunities that may arise to further enhance shareholder value. With that, let me now pass the floor over to our CFO, Tasos Aslidis, to go over the various financial highlights in more detail. Thank you.
Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next 5 slides, I will give you an overview of our financial highlights for the first quarter of 2022 and compare them to the same period of last year. For that, let's turn to slide 15. In the first quarter of 2022, the company reported total net revenues of $18.3 million, representing a 913% increase over total net revenues of $8.6 million during the first quarter of 2021. That was the result of both higher charter and time charter rates that our vessels earned during the first quarter of this year and the increased number of vessels we own and operated compared to the first quarter of 2021.
The company reported net income and net income attributable to common shareholders for the period of $10.5 million, as compared to a net income and a net income attributable to common shareholders of $0.9 million and $0.4 million, respectively, for the first quarter of last year. Interest and other financing costs for the first quarter of 2022 amounted to about $0.65 million, slightly increased as compared to $0.6 million for the same period of 2021. Interest expenses during the first quarter of this year were higher due primarily to the increased LIBOR rates our loans had to pay as compared again to the first quarter of 2021.
Profit EBITDA for the first quarter of this year was $12.7 million, compared to $4 million achieved during the first quarter of 2021, representing a 217% increase. Basic and diluted earnings per share attributable to common shareholders for the first quarter of 2022 were $3.69 and $3.64, respectively, calculated on 2.85 million basic and 2.88 million diluted weighted average number of shares outstanding. Compared to basic and diluted earnings per share of $0.19 for the first quarter of 2021, calculated on about 2.3 million basic and diluted shares, weighted number of shares outstanding.
Excluding the effect on earnings attributable to common shareholders for the quarter of the unrealized gain on derivatives, the adjusted earnings attributable to common shareholders for the quarter ended March 31st, 2022, would have been $3.34 and $3.30 per share basic and diluted, respectively, compared to adjusted earnings of $0.55 basic and diluted in the first quarter of last year. Usually, security analysts do not include the above item in their published estimates of earnings per share. That's why we do the adjustment. Let's now turn to slide 16 to review our fleet performance. We will start our review by looking first at our fleet utilization rates for the first quarter of 2022 and 2021. As usual, our fleet utilization rate is broken down to commercial and operational.
During the first quarter of 2022, our commercial utilization rate was 100%, while our operational utilization rate was 99.6% compared to 100% commercial and 100% operational for the first quarter of last year. On average, 9.5 vessels were owned and operated during the first quarter of 2022, earning an average time charter equivalent rate of $24,636 per vessel per day compared to seven vessels in the same period of 2021, earning on average $14,924 per day.
Our total operating expenses, including management fees, general and administrative expenses, but excluding the total cost of the dry docking cost, averages $6,610 per vessel per day during the first quarter of 2022, compared to $6,517 per vessel per day for the first quarter of last year. If we move further down on this table, we can see the cash flow break-even rate for the first quarter of 2022, which also takes into account dry docking expenses, interest expenses and loan repayments, excluding our balloon repayments and preferred dividends if they are paid in cash.
Thus, during the first quarter of 2022, our daily cash flow break-even rate was $12,821 per vessel per day, compared to $11,064 per vessel per day for the same period in the first quarter of 2021. Let's now move to slide 17. We have used this slide starting this time last year to indicate as a calculation tool that enables our shareholders and investors to assess the earnings potential of our fleet in the current year and under the current environment. The table shown in the slide has two parts. The top part refers to our fixed trade contracts. As you can see that our contract coverage with fixed trade contracts is about 35% for the year.
It is about 56% in the second quarter, but declines to 24% and 11% in the third and fourth quarters. This chartering profile, this chartering strategy reflects our expectation that the market will be quite strong and, as indeed it is, it is indicated by the current forward freight market rates. The rest of our vessels are employed in contracts linked to the Baltic Dry Index relative to their size or are yet to be contracted. Our calculator indicatively shows in the second part of the table the Supramax and Panamax Baltic forward rates as of May 13, 2022, and also shows how these index levels get translated to rates for our ships.
We actually display the final blended rate for the open days of our fleet, which you can see right below the Supramax and Panamax forward rates in the table, in which as you can see is roughly similar in terms of levels to the rates that we have contracted. Based on these assumptions and by further assuming for simplicity $7,500 per day per vessel as OpEx and G&A costs and a 5% commission rate, one can estimate the EBITDA contribution of the days yet to be fixed. The final result is additionally adjusted at the bottom of the table for our preliminary direct expense estimate during the year. This overall exercise is meant to provide a tool, as I mentioned, to calculate our EBITDA for 2022.
Obviously, one can enter his or her own assumption about the rates to do that. It is worth observing that the assumed FFA rates and annualized EBITDA estimate for 2022 would be in excess of $50 million. Final figures, as I mentioned, will obviously depend on the rates materializing over the rest of the year and possibly on the timing of any charters we book. One can also easily estimate from this table the dependence of the EBITDA to the average rate earned by our open days. For example, a change of $1,000 per day in the average rate earned would result in about $2 million change in our 2023, 2022 EBITDA estimates. Let's now move to slide 18. To review our debt profile. As of May 31st 2022, we had an outstanding bank debt of about $75.6 million.
By looking at the chart, we can see that our debt repayments over the next three years range between $10 million and roughly $14 million, and then drop to $2.8 million and $3.6 million in 2025 and 2026. Our next balloon payment is towards the end of 2023 for about $11.3 million and refers to one of our Kamsarmax vessels. We would expect to be able to refinance that balloon payment if we choose so, as we have done numerous occasions previously like that. A quick note also on this slide about the cost of our debt.
The average margin of our debt is about 2.8% and assuming a LIBOR rate of about 1.25% on the top of it, we can estimate that the cost of our bank debt to be around 4.1%. At the bottom of this slide, we can also see a projection for our cash flow break-even rate for the next 12 months. We can see in that projection that a cash flow break-even level of about $13,000 per vessel per day, which is no more to say, includes about $38,000 per vessel per day of loan repayments. Let's now move to slide 19, where we can see some highlights from our balance sheet in a simplified way. This slide shows a snapshot of our assets and our liabilities.
On our asset side, you can see the cash that we have and other assets, other liquid assets that account for about $21 million. The book value of our vessels is approximately $148 million, resulting in a total book value of our, for our assets of about $169 million. On the liability side, our debt as of March 31st, as I mentioned earlier, equals to about $75.6 million, which approximately represents about 45% of the book value of our assets. Accounting for other liabilities in the same, at the same time comes to about $4.6 million, approximately 2.7% of total assets, leaving thus shareholders equity, essentially our net book value, to be approximately $89 million, which translates to $29.8 per share book value.
However, we estimate as of the end of March 2022, that the market value of our vessels to be around $215 million, about 46% higher than their respective book values, suggesting an NAV per share in excess of $52. Our share has recently traded around $35 or about 65% of our net asset value, suggesting that there is significant room for appreciation for our stock if it were to approach our NAV levels. With that, I would like to pass the floor back to Aristides to continue the call.
Thank you, Tasos. Let me open up the floor for any questions that you may have.
Thank you. We will now begin the question -and -answer session. As a reminder for those who want to ask a question, just press star and one on your telephone keypad. We will now take the first question. The line is now open. Please go ahead and ask your question.
Hello. Tate Sullivan from Maxim Group. Good day. I'm just gonna start on new builds and Aristides, can you review some of your conversations with shipyards? Last week we saw a new build announcement for delivery in first half 2024 in the dry bulk industry, and I've heard that maybe now the conversations are focusing on 2025 delivery. Is that the case and why so long please, such a long timeline?
Yes. Yes, Tate. You are right. The good shipyards are mostly full for 2024, so it is difficult to place orders within 2024. Most likely you will be looking for a delivery in 2025 these days. Of course, for smaller dry bulk vessels, I think that in China you can still have 2024 deliveries. The best shipyards really are quite full.
Can you comment -- and historically, and then, I mean, two to three years to get delivery of a new ship. Is there any conversation in industry about expanding shipyard capacity, or what are the barriers to that?
This was done back in 2005, when again, the markets were going through a boom and suddenly people wanted ships. We saw, especially in China, new shipyards being open. It takes time to build the shipyard, a couple of years, and most of them, by the time they were open, the market has corrected and there was no need for them. There was a lot of suffering by people that tried to build new shipyards. I don't see any movement right now to increase the shipyard capacity significantly at all.
Okay. Thank you. Shifting to the future overhang of potential environmental regulations, if that's the right way to put it. Are your clients starting to request newer ships, cleaner ships? Have they been doing so? I mean, what's the kind of potential enforcement of future environmental regulations? Are you already seeing customers demand for newer, cleaner ships?
I think that everybody would like to use newer ships and whatever is available which is more efficient. One has to live with what exists, and everybody is having to live with what vessels exist. It will be quite some time till we see much more fuel efficient vessels being built. I anticipate that while we all want to do what we can to help the environment, the practicalities of the day as such so that we will continue with the conventional ships that we have for quite some time.
Great. Thank you very much, Aristides. I'll turn it over.
Thanks, Tate.
Thank you. We will now take the next question. The line is now open. Please go ahead and ask your question.
Hi. I think I'm up. It's Poe Fratt from Alliance Global Partners. Aristides, if we could talk about the other side of the equation on new builds. You know, you talked about delivery times being extended potentially into 2024 and 2025. What would drive you to order a new build? There's no visibility in the market. Contracts, you know, are still fairly short. Would you consider building something on spec without any, you know, confidence that you might see longer term contracts develop over the next couple of years?
Well, I think you hit the nail there. We are seeing newbuilding orders in container ships, where people can get long-term charters at you know high rates and therefore can justify the investment. In dry bulk, we do not have charterers taking ships for longer periods. That's why you see that not only us, but everybody is reluctant to order dry bulk vessels today at prices which are you know 25%-30% higher than what they were a couple of years ago. I think this is the main reason that you see this discrepancy between container ordering and dry bulk ordering.
Great. That's helpful. You talked about environmental regulations. Can you be a little more specific on your fleet and what you're doing between now and 2023 to prepare for the new regulations?
Well, obviously we are going to fully comply with the new regulations. Even existing ships will be able to comply with new regulations with various initiatives to, you know, paint the hulls so that there is less resistance. At the end, the most important thing that will help comply with the regulations will be to reduce the speed of the vessel. Indeed, this is what everybody will be doing in this market. They will reduce the maximum speed of the ships, which of course is a good thing for the market as a whole because it effectively reduces supply of vessels.
Small things are being done in optimizing the routes, in trying to you know make the engines a little bit more efficient, but these are small numbers. They are not very significant improvements. The biggest improvement comes when you dry dock your ship and you paint it nicely, and then you reduce significantly the resistance, and of course, when you cut your speed.
Okay. If I calculate correctly in the 10-Q that's for the first quarter, your OpEx was roughly in the $6,600 dollar range per day, and you're guiding for the next twelve months to about $6,938 dollars a day. Can you walk us through, you know, a little bit more clearly the drivers on that? Is it higher bunker fuel prices? Also, should we see it as the gradual increase, or will there be a step change in the second quarter?
I think it's an increase that partly depends on inflation, obviously. Partly depends on exchange rate, and that works for us for the time being because we pay management fees in euros, and it's getting cheaper. Also certain things become more expensive, like the lubricants and the like. I think we expect the increase to set in pretty much right now or over the next quarter, and to see overall higher levels compared to 2021. Crewing costs continue to be a challenge, both in getting crew and positioning them. I think there are increases across the board primarily coming from the change in the overall inflation and tightness in the market that we see.
Okay. If we could broadly talk about capital allocation in the context, you continue to find some opportunities for second-hand assets, but arguably you're paying close to NAV for those assets and your stock is trading, you know, at a fairly reasonable discount or wide discount to what, you know, you said your NAV might be. Can you walk us through whether at some point in time you'd consider implementing a share buyback program or potentially like other companies, you know, returning some cash to shareholders in the form of a dividend. Or can you just talk about what we might expect over the next twelve months from a capital allocation standpoint?
That's a very good question, and this is what we are discussing continuously at the board level. There is this, as you say, we are trading at a big discount to our NAV. One would say that you could buy back your stock, and you know, thus that would be a good investment. Our problem is that we are a very small company, especially for the capital markets. Because, as an operating company, I think, the size that we have is sufficient to have the same operating costs, as companies that are much bigger and also be more efficient than them. I think that.
From a capital markets perspective, becoming smaller, which is what essentially we would do if we were to buy back our stock, would reduce the size of the company and the liquidity on the stock. We are discussing and hoping that we will be able to increase our share price towards NAV with a better marketing of, you know, who we are and what we're doing and what the prospects of the company are. This is the reason we have yet to follow such a policy of paying dividends or doing share buybacks. This is always under review.
Yeah. Understood. It just, the stock is so volatile, even a small share buyback might set a higher floor than what we've seen, you know, over the last couple quarters. It just seems like every once in a while there's an air pocket, and if a stock buyback were in place, maybe that would help minimize or maybe dampen that, you know, that sharp drawdown. Just some thoughts.
Sure. Appreciate it.
Thank you. We have a follow-up question from Tate Sullivan. We will now take the question. The line is now open. Please go ahead and ask your question.
Hi, thank you for taking my follow-up. So on the dry docking costs that you're forecasting, can they and then what you reported this quarter, in the first quarter rather, I mean, they do seem higher. Is that related to painting the hulls that Aristides mentioned earlier? Are there other things you can do when the ships are in the dry dock to make them more fuel efficient? Should we expect dry docking costs to increase in the next couple of years as well?
It probably is fair to say that the average dry dock cost, especially for our older vessels, will increase over the next 12 months or two years to partly deal with issues like that and partly deal with the fact that the ships are aging and if they have to go through a dry dock at a later age, they cost a little more.
The unit costs in all the shipyards have increased significantly. You know, a ton, a replacement of a ton of steel has increased 50%. Every unit cost in shipyards has been increasing over the last year. Every component. Yeah.
Okay, great. Following up the capital allocation question, with the ship purchases in the last quarter, you purchased a ship mostly with almost all with cash and reduced debts. Like, are you expecting to finance or add financing, secure financing to the ship and the ship you're buying this quarter too?
We're considering this. I think we have the leisure to market and look at what banks would offer the best terms. We're considering to finance both of our last acquisitions, which were both bought with own funds. We have some embedded funding capacity that we can use if we need to finance another vessel.
Okay. Thank you. Just addressing some potential, I mean, buying ships, second-hand ships in this market. Aristides, can you just talk about how you stress test the current rates and get comfortable with paying higher prices than you have your recent acquisitions for ships on even this, in this period?
Sure. We always and that's why we have not been buying very, very modern ships. I mean, the last ship we bought was a fairly old vessel. With a one-year time charter that could be agreed at the time, we brought the value down to a reasonable level by the end of the one-year charter. These kind of thoughts and assumptions go into our process of selecting ships to buy. We need to have some high charter, even if it's just a year, to make sure that we are able to reduce the price to a price which is close to the mid historical median price at the end of the charter.
Also, Tate, I think a fundamental reason to be optimistic about the market is when you look at slide 10, the order book to fleet ratio it's I would say at almost all-time lows, if not at all-time lows. That definitely provides a fair amount of comfort for the next couple of years. The market will remain at a good level, so to say.
Thank you for taking my call.