Star Bulk Carriers' CEO Discusses Q2 2012 Results - Earnings Call Transcript

Aug.29.12 | About: Star Bulk (SBLK)

Star Bulk Carriers Corp. (NASDAQ:SBLK)

Q2 2012 Earnings Call

Aug 29, 2012 11:00 am ET

Executives

Spyros Capralos – President and Chief Executive Officer

Simos Spyrou – Chief Financial Officer

Analysts

Natasha Boyden – Global Hunter Securities, LLC

Chris Snyder – Sidoti & Company

Operator

Thank you for standing by, ladies and gentlemen, and welcome to the Star Bulk Conference Call on the Second Quarter 2012 Financial Results. We have with us Mr. Spyros Capralos, President and Chief Executive Officer; and Mr. Simos Spyrou, Chief Financial Officer of the company.

At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. (Operator Instructions) I must advise you that this conference is being recorded today, Wednesday, August 29, 2012.

We now pass the floor to one of our speaker today Mr. Spyros Capralos. Please go ahead sir.

Spyros Capralos

Thank you, operator. I’m Spyros Capralos, President and Chief Executive Officer of Star Bulk Carriers, and I would like to welcome you to the Star Bulk Carriers’ first half and second quarter 2012 financial results conference call. Along with me today to discuss our financial results is our CFO, Mr. Simos Spyrou.

Before we begin, I kindly ask you to take a moment to read the Safe Harbor statement on slide number two of our presentation.

Let us now turn to slide number three of the presentation for a preview of our second quarter 2012 financial highlights in comparison to last year. In the three months ended June 30, 2012, gross revenues amounted to $21.8 million, representing a 4% reduction versus the same period of 2011. General and administrative expenses were reduced by 25% to $2.1 million in Q2 2012 versus $2.9 million in Q2 2011.

Overall, during the second quarter of 2012, the company had a net loss of $4.6 million compared to a net income of $1.7 million in Q2 2011. Excluding non-cash items, our net loss for the second quarter amounted to $2.9 million compared to an adjusted net income of $2.3 million in Q2 2011.

Adjusted EBITDA for the second quarter of 2012 was $8.4 million compared to $15.1 million last year. Our time charter equivalent during this quarter was $14,628 per day compared to $18,664 last year, representing mainly the low freight rate environment and as well as the lost off-hire due to the grounding of the Star Polaris.

Our average daily operating expenses were $5,241 per vessel, 11% lower than the same period last year despite the fact that our average vessel size increased by 39% due to the higher number of Capes in our fleet.

The adjusted net loss of $2.7 million represents $0.04 loss per share basic and diluted.

Please turn to slide number four of the presentation for a preview of our first half 2012 highlights. In the six months ended June 30, 2012, gross revenues amounted to $49.8 million representing a 5% reduction versus the same period of 2011. G&A expenses amounted to $5.3 million and overall during the first half of 2012 the company had a net loss of $4.5 million.

Excluding non-cash items, our net income for the first half amounted to $3.2 million while our adjusted EBITDA stood at $26.4 million. Our time charter equivalent during this period was $15,724 per day, while our average daily operating expenses amounted to $5,416 per vessel. The adjusted net income of $3.2 million represents $0.04 earnings per share basic and diluted.

Please turn now to slide five to discuss our balance sheet profile. First of all, I’d like to point out that we currently have zero capital expense commitments related to the newbuilding as well as no exposure to interest rate swaps. So we continue to take advantage of the prevailing low interest rate environment.

As of today, total debt stands at $235.1 million and our current cash position stands at $38.6 million. Our net debt stands at around 3.7 times 2012 EBITDA. For this calculation, we have annualized our first half 2012 EBITDA and we have adjusted it for non-recurring and non-cash items. We feel comfortable regarding our ability to service our loans as our remaining principal repayment obligations for 2012 stand at $8.9 million. As you can see in the graph, our debt amortization profile for 2013, 2014 and 2015 stands at $32 million, $33 million and $28 million respectively.

Please turn to slide six for an overview of our fleet employment and our charter counterparties. This information is also available on our website in a very transparent manner and is updated regularly. Currently, we have secured 86% of our operating days in 2012, 35% in 2013 and 19% for 2014, with most of the open days in the Supermax category. Specifically, our time charter coverage in the Capesize segment is 97% for 2012, 73% for 2013, and 43% for 2014.

We refer especially to the Capes as this segment has been the most volatile and the most negatively affected so far. Supermax raise have been less volatile and have maintained healthier margins. We plan to opportunistically employ our vessels with upcoming contract expirations on period or for charters as the freight rate environment improves.

Our total contracted revenue amounts to approximately $152 million, while it’s worth noting that we no longer have legacy charters from the highs of 2008 that would be extremely difficult for our charters service. Moreover, I would like to highlight the high quality credit profile of our charters with blue-chip companies like RioTinto, Cargill and Louis Dreyfus among our counterparts.

Please turn now to slide seven to briefly discuss recent highlights. In today’s press release, we declared a cash dividend of $0.015 per outstanding share of the company’s common stock for the three months ended june 30, 2012. The dividend is payable on or about September 18, 2012 to shareholders of record as of September 10, 2012. This is a 13th consecutive dividend since the company reinstated the dividend back in 2009. Since the extension of the repurchase plan, we have repurchased and retired about 926,000 shares.

Star Bulk has received a written notification from NASDAQ indicating that the company is not in compliance with the NASDAQ listing rule, because the closing bid price of the company’s common stock was below the $1 minimum for more than 30 consecutive business days. Our Board has decided to propose a reverse split in the upcoming AGM in order for the company to have this option to regain compliance and avoid the possibility of delisting.

During July, the Star Polaris sustained main engine failure while sailing from South Korea. The vessel is currently docked in South Korea where it’s undergoing repair. The company expects this repair to be completed in November.

Subject to the completion of investigation for the cause of the engine failure, the company will seek to recover the cost of the repairs and damages related to the vessel being off hire under the warranty of quality provided by the shipyard where the vessel was constructed and the company’s hull and machinery insurance policy.

Please turn to slide 8. Our strategy to bring the technical fleet management in-house in late 2009 continues to improve our operational performance quarter-after-quarter. Our cost cutting efforts in our operating and G&A expenses have played a key role in our financial and operating performance in this challenging market environment.

On the top right graph, you can see that while the weighted average size of our vessels increased slightly during the first half of 2012, our average daily operating expenses declined. On the bottom right graph, you can see that while the average number of employees increased by 33% from 40% during the first half of 2011 to 53% in first half of 2012, our G&A expenses excluding the one-off severance payment and stock-based compensation slightly decreased. While we have been prudently containing our expenses, our ship management quality standards have been maintained at high level.

The lower left hand side shows Star Bulk’s average deficiencies per port state control inspection versus the industry average. As you can see, we have consistently outperformed the industry and we try to improve our quality standards every year. Moving forward, we remain focused on further optimizing operating cost and implementing our quality objectives.

And now I’ll ask Mr. Simos Spyrou, our CFO, to discuss on the financials and give an update on the market developments. The floor is yours, Simos.

Simos Spyrou

Thank you, Spyros. Let us now move to slide 10 for an overview of our balance sheet as of June 30, 2012. Current assets stood at $30.2 million, our fixed assets amounted to $608.2 million, and total assets amounted to $681.6 million. Current liabilities were $49 million, while non-current liabilities amounted to $204.7 million, and stockholders’ equity was $427.9 million.

If we can now turn to slide 11 to discuss our second quarter 2012 income statement, I would like to point out that our results include non-cash items amounting to $1.7 million, which are depicted in the middle column, while the adjusted figures exclude them. For the second quarter of 2012, non-cash adjusted revenues amounted $23.4 million compared to $22.7 million in the same period last year. While this quarter's revenue is slightly higher than last year’s, our own fleet was significantly larger this year. Our revenue was [contained] by lower freight rates and the off-hire related to Star Polaris.

Our net loss for the second quarter of 2012 amounted to $4.6 million, in particular non-cash items include a $1.6 million related to the amortization of above market acquired time charters and expenses of $71,000 relating to the amortization of stock based compensation. Excluding the non-cash items, our net loss for the second quarter of 2012 amounted to $2.9 million or $0.04 loss per share.

The increase in vessel operating expenses for the three months ended June 30, 2012 versus the same period last year was due to the increased number of vessels in our fleet and the increased average vessel size.

Voyage expenses increased to $5.3 million for the second quarter of 2012 from $4.4 million in the second quarter last year. During the three months ended June 30, 2012 our vessels were under two voyage charter agreements, while during the three months ended June 30, 2011 none of our vessels was under voyage charter agreements. An amount of $3.4 million in the voyage expenses during the second quarter of last year relates to the chartering in a third party vessel to serve a shipment under a COA.

G&A expenses adjusted for non-cash stock-based compensation totaled $2.1 million during the second quarter of 2012 compared to $2.3 million during the second quarter of last year, reduced by 12%. I would like to underline that this decrease was accompanied by an increase in the number of employees.

Please turn now to slide 12 to discuss our first half 2012 income statement. Again, non-cash items are depicted in the middle column and the adjusted figures exclude them. For the first half of 2012, non-cash adjusted revenues amounted to $53 million compared to $52 million in the same period last year. Our net loss for the first half of 2012 amounted to $4.5 million. In particular, non-cash items include a $3.2 million related to the amortization of above market acquired time charters, expenses of $1.4 million relating to the amortization of stock-based compensation, and the loss on the sale of vessel of $2.2 million associated with the sale of Star Epsilon.

Excluding the non-cash items, our net income for the first half of 2012 amounted to $3.2 million or $0.04 earnings per share. The increase in vessel operating expense for the six months ended June 30, 2012 versus the same period in 2011 was due to the increased number of vessels in our fleet and the increased average vessel size.

Voyage expenses increased to $14 million for the first half of 2012 from $11 million in the first half of 2011. The expense for chartering-in third-party vessels to serve a shipment under a COA amounted to $4 million and $10 million for the six months period ended June 30, 2012 and 2011 respectively.

Excluding these expenses, the increase in voyage expenses was mainly due to the fact that our vessels were under five voyage charter agreements compared to none for the same period last year. Excluding stock-based compensation, G&A expenses amounted to $3.9 million compared to $6.4 million last year. The decrease was mainly due to the non-recurring severance payment to our former CEO and to our former CFO in the first half of 2011 totaling $2.9 million.

I would like now to give you a brief update on the dry bulk markets. Please turn to slide 14 for an update on the supply side. Dry bulk vessel deliveries have continued at the record high pace and have kept the BDI under pressure for the past several months. We expect deliveries in 2012 to continue at high pace, but should slowdown afterwards.

As you can see on the top right-hand graph, deliveries in the period 2008 to 2011 have had an average slippage rate around 30%. Based on annualized figures of vessel deliveries up to July 2012, deliveries are expected to reach about 115 million deadweight tons. This implies that slippage in 2012 could be at somewhat lower levels compared to recent years.

On the bottom right hand graph, we provide the order book for the remainder of 2012, 2013, 2014 and 2015. As you can see, while the dry bulk industry still has to go through a process of absorbing a very large number of new vessels that will come into the market this year, the current order book for 2013 onwards stands at significantly lower levels. It’s worth noticing that the order book for 2013 is around the same level as the five remaining months of 2012.

What is important and encouraging is the fact that Bulk Carriers demolition during 2011 increased to an all time record of 22.3 million deadweight tons, and this year’s scrapping activity has continued to increase. [Audio Dip] and then increasing number of younger vessels they will go out older vessels leaving to (inaudible) owners with no real alternative other than scrapping.

As you can see in the lower left graph, scrapping activity was very high in January to July period with 18.3 million deadweight tons of dry bulk vessels going to the scrap yards. Continued strength in scrapping activity should slow down the fleet’s net growth rate, which effectively could provide some relief to the supply pressures.

Please turn now to Slide 15 for an update on Chinese demand. We believe that the fundamentals behind the demand strength we have seen in the past years are still intact and we will ensure the strength of demand growth in the future. China’s increased energy needs have turned the company from a traditional coal exporter to the single biggest coal importer in the world. As China continues growing fast, we expect the need for energy in general and coal fired energy in particular to continue growing as well. The growth of this trade has been outstanding, from significant coal trade surplus up until 2005 we have come to a coal trade deficit of around 270 million tons during the last 12 months. What’s impressive is the growth potential of this trade.

China’s coal production during the last 12 months was more than 3.6 billion tons. So as you can understand, the 270 million tons of net imports represents only around 6% of the total. The potential for additional coal imports is large and we believe that once the additional mining capacity comes online, we will see rapid growth in this trade.

On the two graphs on the bottom of the slide, you can see how Chinese iron ore and coking coal imports have developed over the last years. Coking coal imports have also been growing at very healthy levels and we believe that this trend will continue in the future along with new mining capacity coming online. As most of you know, iron ore demand growth has been the single most significant demand force during the years of the dry bulk shipping boom. This is unlikely to change in the near future in our opinion.

We expect Chinese iron ore imports to continue growing based on undeniable geological factors. Chinese domestic iron ore quality is very low compared to international commercial mining stand-ups. Therefore, the additional cost of the processes needed for Chinese iron ore to become commercially acceptable make its final cost very high. Chinese mines cannot be seen as sustainable long-term sources of iron ore, because once new cost effective supply becomes available for other sources, these mines will be uncompetitive and therefore face survival issues.

In other words, we believe that even with zero growth in iron ore and steel demand, there is lots of room for growth in Chinese iron ore imports from the substitution of domestically mine with imported iron ore.

I would like now to pass the floor back to Mr. Capralos for his closing remarks.

Spyros Capralos

Thank you, Simos. In conclusion, we believe that Star Bulk is well positioned from a financial and operation point of view to sustain the company through the near-term challenging environment and weather the storm. On top of our high quality modern fleet, Star Bulk also has one of the most diverse group of high quality charters in the sector.

As we discussed earlier in our presentation, our campaign to bring our fleets management in-house has provided tangible results as it has led to meaningful increase in our efficiency and transparency, while consistently lower operating cost.

We have a moderately leveraged balance sheet as compared to our peer group, a healthy liquidity profile and an experienced and dedicated management team. Most importantly, we believe that our financial condition is stable. We currently have no capital expenditures related to new buildings, and we have $38 million of cash in the banks.

From an operational perspective, our Capesize fleet is mostly covered for the next two to three years and at above market charter levels while our operating expenses are being continuously optimized. We believe we have all the elements in place to continue with our fleet growth and renewal strategy.

Without taking any more of your time, I would now pass the floor over to the operator. In case you have any questions, both Simos and myself will be happy to answer them. Thank you.

Question-and-Answer Session

Operator

(Operator Instructions) your first question today comes from the line of Natasha Boyden of Global Hunter. Please ask your question.

Natasha Boyden – Global Hunter Securities, LLC

Thank you, operator. Good morning gentlemen.

Spyros Capralos

Hi, Natasha.

Natasha Boyden – Global Hunter Securities, LLC

Shall I talk a little bit about your balance sheet? obviously, you’ve made a lot of comments that you have – you leveraged balance sheet, and your balance sheet is in a better position than a lot of your peers. What can we expect the company to look at in terms of growth opportunity here or is deleveraging the main focus, and then following on that, what about further share buybacks given major (inaudible)?

Simos Spyrou

Hello, Natasha, this is Simos.

Natasha Boyden – Global Hunter Securities, LLC

Okay.

Simos Spyrou

In terms of the buybacks, we have an active buyback plan of up to $3 million that is, the Monday that we’ve got from the Board, and the general mandate that has been voted by the shareholders is up to $30 million. We have spent about $900,000 up to now. And we are trying to balance between reducing our cash, which is valuable these days, and buying back shares in the market and of course, the dividend that we continue paying to the shareholders. So we try to let’s say opportunistically buying shares from the market and keeping the available cash on the balance sheet.

Now, in terms of deleveraging or new acquisitions obviously, as you understand, the cash that we have is not enough to acquire new vessels even at this environment but we are trying to maintain as much as we can in order to be able to weather the storm if the values of the assets continue dropping and we have early issues with the covenants in our current bank facilities.

Natasha Boyden – Global Hunter Securities, LLC

Okay, great. And then just a flip of the coin, as we do look at your fleet here, do you have any ships that you would be interested in selling given what stock prices are?

Spyros Capralos

Natasha, this is Spyros now. Right now, we believe that the market is in a distressed state. And therefore, we don’t think that at these levels, we should be selling any of our vessels.

Natasha Boyden – Global Hunter Securities, LLC

That makes sense.

Spyros Capralos

The only vessel that we may be having an issue is the oldest Cape that we have, which is 21-year-old Cape, the Sigma, which is working right now in the spot market. And if we see any upturn in the market, yes, then we may consider selling her, otherwise we’ll use her until if we see that, we managed to get charter rates that exceed the operating expenses, otherwise we’ll end up scrapping her.

Natasha Boyden – Global Hunter Securities, LLC

Okay, yeah, the signal was what I had in mind when I was asking that question, that's helpful. In terms of your chartering strategy, obviously you said on the call that you would at this point in the cycle where rates are consider putting them on short time charters on the spot market, at what point the rates have to go up enough for you to think about putting them on longer time charters?

Spyros Capralos

Well, right now what we do is, we don't have this issue with the Cape as most of the Cape fleet is already in charter for throughout 2013 and 2014. For the Supramax’s, we think that the market is less volatile and at those levels we still have some – we’ll create some operating gains. The problem is that you don’t want to charter your fleet long-term at today’s low levels and then to see the market start going up that's why we’ll opportunistically use our fleet and whenever we see that there is a hike in the charter rates, then we may get into longer-term charters for the Supramax’s.

Natasha Boyden – Global Hunter Securities, LLC

Great, thank you very much for your time.

Spyros Capralos

Thank you, Natasha.

Operator

Thank you. Your next question comes from the line of Chris Snyder of Sidoti & Company. Please ask your question.

Chris Snyder – Sidoti & Company

Good morning guys.

Spyros Capralos

Good morning, how are you?

Chris Snyder – Sidoti & Company

Great, how are you? So first, the Chinese iron imports have been definitely slowing and I know with the expansion plans they have, they obviously have to resume again at some point, (inaudible) when do you think they will start importing again at high levels?

Spyros Capralos

The reduction in commodity prices overall, we think that will make China and everybody else, but primarily China start importing again at increased levels with iron ore being below $100 that we haven’t seen for a long time. We think that China will start importing, because mainly the cost of producing is much higher than what would be the cost of importing, and therefore we think that it really make sense for them to start importing than producing locally. And that could change dramatically the market in favor at least for the Capesize fleet.

Chris Snyder – Sidoti & Company

Okay, yeah. And when you guys referenced a voyage contract agreements on the two vessels, is that basically was spot market contract – in terms of stock market contract?

Spyros Capralos

Yes, that is correct.

Chris Snyder – Sidoti & Company

Okay. And I know, lot of your contracts were above market rates for a pretty good (inaudible) 2014 and beyond. Are there any of those companies that you guys are worried about or being able to build the contracts or you pretty confident in all of that?

Spyros Capralos

Well, as you can see on the charters that we have, first of all they are all first top class charters, and we don’t see anybody not being able to fulfill the contracts, especially because when we say about top mining companies remain really the top mining companies of this world, and therefore the [credit] raising in such that does not create any issues regarding fulfilling the contracts.

Chris Snyder – Sidoti & Company

Okay. Thanks a lot. Thanks a lot guys. That’s it from me.

Spyros Capralos

Thank you, Chris.

Operator

Thank you. Your next question comes from the line of (inaudible). Please ask your question.

Unidentified Analyst

Good afternoon gentlemen, how are you?

Spyros Capralos

Good afternoon.

Unidentified Analyst

So, I have a few questions for you. Number one with Polaris, is there any risk of losing the charter because of these operational issues and these unforeseen actions?

Spyros Capralos

With Polaris, the biggest loss that we are having is that we do not get paid right now for – the vessel is out of employment. We do not foresee of losing the charter, as charter contract, it says that we may lose the charter only if it is at negligence from the side of the owners, something that was not happened and…

Unidentified Analyst

Okay.

Spyros Capralos

The engine failure has to do with the manufacturer in terms of the warranty of the manufacturer.

Unidentified Analyst

Do you expect to receive basically 100% recovery on both the loss hire and also cost of repair?

Spyros Capralos

This is not for the loss of hire, because we are not insured on the loss of hire, but we're going to get 100% from the warranty of the shipyard who constructed this new building. And if we don't get 100% from them, then the insurance company will cover the rest minus the deductible that we have which is great if not that meaningful amount.

Unidentified Analyst

No, what are the impacts, the few global impacts I wanted to speak to you about. Number one, a lot of these major miners are cutting their capacity plans going forward, so how does that affect the expectations you have of the future supply demand. Does it already incorporate these developments, I guess in the last few weeks and months, these announcements have been made, how does that impact you?

Spyros Capralos

Well, it's normal that mining companies may stop their investment programs in view of the falling commodity prices. On the other hand, we expect at those levels that China will start importing even more. Therefore, I don’t think that it can be sustainable do have such low prices. In the short term, I think that the increase of demand from China will boost the imports of – and therefore it will be very positive for the Capesize vessel.

If it remains in the longer term, then yes we’d expect a slow down in the activity, but that would take a long time and because the production cost in China is much bigger than what is – as international prices, we expect that we'll see increase demand and (inaudible) from local production to inputs.

Unidentified Analyst

Are you seeing also an increase in or at least the belief or expectation of increases in ton miles in thermal coal from the U.S. over to Asia especially with the drop in the coal demand in the U.S.?

Spyros Capralos

Well, that’s exactly what we start seeing and over here there is a much more decreased exports from the U.S. to China. We'd have not experienced it because we have not done it with our own vessels, because our Capes are already in the long-term charter to some of the big mining companies, but that’s what we hear around in the market.

Unidentified Analyst

And what about…

Spyros Capralos

Unfortunately, this has not been reflected yet in the charter rates that Capesize vessels are getting.

Unidentified Analyst

Okay, that’s a good positive in the future, I guess. Now what about drought impacts in the U.S. on the Supramax, because I’ve been hearing, I believe DS Norden just mentioned, but they see potential drop in supra rates, because of this drought. What do you feel about that?

Spyros Capralos

It could be, but I cannot really assess the impact of the drought in the worldwide production of…

Unidentified Analyst

Okay, okay. And I just wanted to see if you incorporated that into your view. Now, a couple more questions, I think, as you know – as a long-term shareholder, we have a lot of respects for how efficiently you have operated the company, there is no issues with operational management. I think one big issue that, I brought up in the past is the capital management, and a few issues as earlier caller mentioned about share buybacks versus dividend payment, which creates the most value for shareholders. I think clearly with the share price where it is now.

I think even the more simplistic and obviously, which show that using cash for share buybacks would be much better or even better using conserving cash, especially if shipping market stays weak like this going forward. I think one big concern I have with the shareholders that it doesn’t make sense to use money to pay dividends right now. It’s not a good use of capital, and I think it might in danger that the balance sheet going forward and I love you points about that.

And the second issue I have is one – the big reason we believe that the stock price has fallen so far away from the value of even the current very, very depressed (inaudible). The assets is because there is a great fear among minority shareholders that there is going to be big dilution coming in. I think if you can – with the fears of that – that you will see an immediate impact to the share price possibly even to the point were the NASDAQ delisting issue its no longer relevant. So I – could you answer those two or at least address those two issues. Again number one dividends in the phase of the current market and number two, this over hang of this fear of a dilution.

Spyros Capralos

I’ll try, even though they are quite difficult issue, on the one hand we have shareholders who value that we continue paying them a dividend every quarter and this total dividend that we are paying this quarter is about $1.2 million because we have approximately 80 million shares for – at $0.015 per share makes $1.2 million. And for many of our retail shareholders, it’s very important to receive this dividend which today is quite substantial compared to what they get in the market or which has a yield close to double-digit yield.

On the other hand, we understand that you say from your side the much better use of our cash to keep the cash and buyback shares, but the same thing couldn’t be done by some of the shareholders who can use the dividends they get to buy some more shares from their side, but we will consider further. We decided in our Board meeting today to extend and to pay dividend again for this quarter, but we’ll rethink about it to remain in future. Every time we’ll give a serious thought to what is best for the shareholders of the company and that's what we decide.

Right now the most important thing is to make sure that we are back into the NASDAQ requirements then to go back to the rules of NASDAQ that our stocks would be trading above $1 and therefore we have next week, next Friday, 10 days from today our AGM, and we hope that most of our shareholders will vote in favor of proceeding to the reverse stock split has we have proposed to the shareholders, we do not have the specific reverse stock split number, but we've said it's going to be either for 1 to 5 or up to 1 to 15, so we don't know exactly at what level we should do it. So we believe that we should be back to the normal NASDAQ rules.

Unidentified Analyst

The dilution…

Spyros Capralos

Regarding dilution, of course what we’ll try to do is always keep the auctions open and to have every shareholder have the possibility to keep and maintain his position without diluting scheme whatever we do. We will not surprise anybody by overnight offering.

Unidentified Analyst

Okay, great. And since you mentioned – one of the fears realized last year when the offering took place, I guess with insiders. And one issue that I think, will you give an updated shareholder list, because there was a pretty sizable offering last time, we’d like to know who was involved in it, and what parties were involved, and I think that’s the current shareholder list doesn’t seem to update all holdings of possibly the Chairman and also his entities, related parties, et cetera. So if we can have that as soon as possible, I’d really appreciate that.

Spyros Capralos

No, we take a note on that, and we’ll come back for you on this.

Unidentified Analyst

Okay, great. And last point, I’d like to make is, I think its very impressive how your operational efficiency keeps improving, and I think you guys are doing a fantastic job and charming market, so confidence in the management does not – in anyway stress at this time. Thank you very much.

Spyros Capralos

Thank you very much for making of these positive comments on the management. And I’ll pass your comments to the rest of the board.

Unidentified Analyst

Thanks, well I’ll see you at the meeting sir, thank you.

Spyros Capralos

See you at the meeting, yes. Next week.

Operator

(Operator Instructions) There are no further questions at this time, please continue.

Spyros Capralos

Well, thank you, all for taking the time to join us today, for our earnings conference call. Our company is focused on future profitability and growth and to continue to rewarding our shareholders well with the dividend, our 2012 third quarter results has schedule for November, for the time being, thank you very much, and we hope that all of you will both in favor in our AGM for next week. Thank you.

Operator

Thank you. That does conclude our conference for today. Thank you all for participating. You may now disconnect.

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