Softer dry bulk market squeezes Safe Bulkers profit

SAFE Bulkers has posted slimmer second-quarter profits, as it pushes ahead with renewing its fleet of dry bulk carriers.

The Cyprus- and Greece-based owner of 47 bulkers saw net income drop to $1.7m, from $27.6m in the second quarter of 2024.

Safe pointed to a weaker charter market than the same phase of last year, saying revenues fell “due to lower charter hires, decreased earnings from scrubber-fitted vessels and increased operating expenses”.

Net revenues decreased from $78.5m to $65.7m year on year, with Safe’s vessels averaging a daily time charter equivalent rate of $14,857 during the latest quarter, versus an average $18,650 last year.

Stripping out non-cash and one-off items such as two profitable vessel sales in the second quarter of last year and a gain on derivatives this year, the adjusted profit came to $3m, compared with $20.3m in the same period last year.

“We experienced a softer market compared to the previous year, which impacted our revenues and profitability,” said company president Loukas Barmparis.

“We remain focused on fleet renewal, strong liquidity, comfortable leverage and long-term value creation.”

The New York Stock Exchange-listed owner has been gradually renewing its fleet with newbuildings, while “selectively” selling older vessels in the fleet.

The latest sale deal, inked just last week, will see buyers pay $12.5m for its 18-year-old, Japanese-built kamsarmax Pedhoulas Leader(IMO: 9323065).

The outgoing vessel is scheduled to be delivered to the new owners sometime between August and October this year.

Meanwhile, the company has so far taken delivery of 12 Phase 3 and Tier III compliant newbuildings, with another six on order, including two methanol dual-fuelled kamsarmaxes.

In addition, 26 of its existing vessels have so far received an “environmental upgrade” to increase efficiency and lower consumption, a programme that it is “continuing”, it said.

This month, the owner agreed to refinance an existing loan with a $75m sustainability-linked five-year facility, under which the interest margin will be adjusted in relation to the carbon intensity index of the fleet.

Safe’s board has declared an unchanged cash dividend of $0.05 per common share for the latest quarter.