Star Bulk Carrier CEO Discusses Q4 2010 - Earnings Call Transcript

Star Bulk Carrier Corps ( SBLK)

Q4 2010 Earnings Call

February 23, 2011 08:30 am ET

Executives

Mr. Petros Pappas -- Chairman of the Board of Directors

Mr. Spyros Caprolos -- President and Chief Executive Officer

Mr. George Syllantavos, Chief Financial Officer

Analysts

Noah Parquette - Cantor Fitzgerald

Doug Garber - FBR Capital Markets

Presentation

Operator

Welcome to the Star Bulk conference call on the fourth quarter 2010 financial results. We have with us Mr. Petros Pappas, Chairman of the Board of Directors, Mr. Spyros Caprolos, President and Chief Executive Officer, and Mr. George Syllantavos, Chief Financial Officer of the company. (Operator Instructions.)

We now pass the floor to one of your speakers today, Mr. Paul (inaudible) Vice President of Capital Link. Please go ahead sir.

Paul

Thank you, I would like to remind that the company publically released our financial results last night, Tuesday, February 22, 2011 after the market closed in New York, where it is available to download, along with today's presentation, on the Star Bulk Carriers website, which is www.starbulk.com. If you do not have a copy of the press release or presentation, you may contact us, the Investor Relation advisor for Star Bulk carriers, at 212-661-7566 and they will be happy to fax or email a copy to you. This conference is also being webcast, and it is user controlled and can be accessed through Star Bulk's website. I must advise you this conference is being recorded today, Wednesday, February 23, 2011. I would like now to hand over the floor to your first speaker today, Mr. Spyros Capralos. Please go ahead Sir.

Spyros Capralos

Thank you Paul, and good morning ladies and gentlemen. I am Spyros Capralos, the newly appointed President and Chief Executive Officer of Star Bulk Carriers. Welcome to the Star Bulk conference call to discuss the fourth quarter and full year ended December 31, 2010 financial results. Along with me today to discuss our financial results is the Chairman of the company’s Board of Directors and major shareholder, Mr. Petros Pappas, and our Chief Financial Officer, Mr. George Syllantavos.

Before we begin today’s presentation, I would like to pass the floor to Mr. Pappas for an opening statement.

Petros Pappas

Thank you Spyros, and good morning ladies and gentlemen. Following Mr. Tsirigakis’ departure from our company, our Board elected Mr. Spyros Capralos as our new President and CEO. Spyros is a very prominent personality both in Greece and internationally, with extensive banking, and more importantly, capital markets background. Having served as the CEO of the Athens Stock Exchange and as a Chairman of the Federation of European Stock exchanges among many other important positions that he has held.

I feel we have chosen a strong person for this position, and I believe that the timing is very crucial, as I expect two years of challenge and opportunity to arrive in the Star Bulk horizon. Challenge because of the full order book of vessels coming forth and opportunity because the essence of shipping is investing at times when harvest prices are low. To turn challenge to opportunity, one needs to have a strong team put together; I’m therefore intending to support him whole heartedly, and although my role is that of a non-executive Chairman of the Board of Star Bulk, my intention is to align my family’s private interest with interest of the public company and chip in my 33 years experience in this sector to assist this company to rise from a challenging period stronger in every possible respect.

We are in this together, and we are committed to the enhancement of Star Bulk reviving. In this shareholder value building effort, we will not spare any effort based on our experience, our expertise, our well-established industry contracts, our goodwill, and our creativity. I would now like to pass the floor to Mr. Capralos to continue with the presentation of the company’s financial results. Thank you.

Spyros Capralos

Thank you, Petros. Before we begin, I kindly ask you to take a moment to read the Safe Harbor statement on slide two of the presentation. While you do that, and before we commence the earnings presentation, I would like at this time to introduce myself. Before joining Star Bulk, I served as Chairman of the Athens Exchange and Chief Executive Officer of the Hellenic Exchanges. Prior to this, I held executive positions for (inaudible) Olympic games in Greece, following a bank career with the National Bank of Greece and the (inaudible ) Group, as well as a ten year international banking career with the Bankers Trust Company, now Deutsche Bank, in Paris, New York, Athens, Milan, and London.

I’m starting my tenure at a challenging time for the shipping industry, and in particular in the dry bulk sector, characterized by a substantial supply of vessels, softening of rates, but also growing demand and continued recovery of industrial economies. I believe as my capital markets experience will be valuable assets in the continued development of Star Bulk, and maximization of shareholder value. In the months to come, I intend to meet analysts and investors on road shows and conferences. That will give me the opportunity to discuss further Star Bulk’s strategic issues and developments.

Ladies and gentlemen, let us now turn to slide number three of the presentation to discuss some important financial data. On this slide, we’ll present certain key data illustrative of why we continue to believe that while Star Bulk continues to enjoy a very comfortable financial position, it remains substantially undivided. As of yesterday, our minimum customer contracted revenue was approximately $195 million, and our market capitalization stood at $155 million. We estimate a charter-free value of our fleet to be about $361 million and the charter adjusted volume to be about $400 million. These figures include approximately $64 million of down payments for our two new building Capesize vessels, consisting of around $43 million of company cash, as well as $31.5 million draw down from our new loans.

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