Seanergy Maritime Hldgs (NASDAQ:SHIP) reported first-quarter financial results on Thursday. The transcript from the company's first-quarter earnings call has been provided below.

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The full earnings call is available at https://edge.media-server.com/mmc/p/pfbzctqf/

Summary

Seanergy Maritime Hldgs reported a strong first quarter with net revenues of $43 million, up from $24.2 million the previous year, and adjusted EBITDA of $28.2 million, a 253% increase year-over-year.

The company declared its 18th consecutive quarterly cash dividend of $0.20 per share, focusing on shareholder returns, sustainable fleet development, and maintaining a strong balance sheet.

Seanergy Maritime Hldgs advanced its fleet renewal strategy by contracting three additional vessels and selling an older vessel, with financing secured for four out of six new vessels, and expects multi-year charters with downside protection for its new builds.

The company's index-linked chartering strategy outperformed, with fleet time charter equivalent rates exceeding market averages, and 45% of available operating days fixed at rates over $29,000 per day for the rest of the year.

Management expects continued strong cash flow and earnings through 2026, supported by favorable market conditions, disciplined capital allocation, and a strong balance sheet, despite acknowledging geopolitical uncertainties.

Full Transcript

OPERATOR

Thank you for standing by ladies and gentlemen and welcome to the Seanergy Maritime Holdings Conference call on the first quarter ended March 31, 2026 financial results. We have with us Mr. Stamatis Tsantanis, Chairman and CEO and Mr. Stavros Giosakis, Chief Financial Officer of Seanergy Maritime Holdings At this time all participants are in listen only mode. There will be a question and answer session at which time if you would like to ask a question, please press 11 on your telephone keypad and you will hear an automatic message advising your hand is raised. Please be advised that this conference call is being recorded today, Thursday, May 28, 2026. The archived webcast of the conference call will soon be made available on The Synergy website www.seanergymaritime.com under the webcast and Presentation section under the Investor Relations page. Many of the remarks today contain forward looking statements based on current expectations. Actual results may differ materially from the results projected from those forward looking statements. Additional information concerning factors that can cause the actual results to differ materially from those in the forward looking statements is contained in the first quarter ended March 31, 2026 earnings release which is available on the synergy website again www.seanergymaritime.com I would now like to turn the conference over to one of your speakers today, the chairman and CEO of the company, Mr. Stamatis Tsantanis. Please go ahead sir.

Stamatis Tsantanis

Thank you operator and welcome everybody. Seanergy delivered a very strong first quarter despite what is typically the seasonally weakest period of the year. Highlighting the earnings, power and resilience of the pure-play Capesize platform that we have built diligently over the past years. Net revenues increased to $43 million from $24.2 million in the same quarter of last year, while adjusted EBITDA of $28.2 million up 253% year over year. Adjusted EPS for the quarter was $0.63 per share, one of the strongest amongst listed dry bulk peers, reflecting both favorable market conditions and the operating leverage embedded in our platform. Based on our strong performance and disciplined capital return policy, we declared our 18th consecutive quarterly cash dividend of $0.20 per share, bringing cumulative shareholder distributions to approximately $2.84 per share or $55.6 million since inception, the execution of our strategy continues to develop. Among our main long term objectives of rewarding our shareholders sustainable fleet development and maintaining a strong balance sheet. During the quarter, we significantly advanced our fleet renewal strategy by contracting three additional vessels at leading shipyards in China and Japan with the latest order placed at Hengli Shipbuilding this April while agreeing to sell one of our older capesize vessels at firm secondhand pricing. Since the launching of the program we have contracted six six Modern Eco Design new buildings of Cape Sizes and Newcastle Max and agreed to dispose of three older vessels materially enhancing the quality, efficiency and long term earnings capacity of our fleet. Importantly, we have already secured financing for four of the six vessels at attractive terms. While approximately $69 million of equity has been invested from internal funds, we believe the combination of favorable delivery positions next year, basically most of them competitive financing and selective vessel disposals, represents a disciplined capital allocation strategy capable of generating long term results. Our new building strategy combines with prudent risk management. In this context and based on advanced discussions with leading charterers, we expect these vessels to secure multi year time charters with downside protection above cash breakeven levels complemented by profit sharing structures preserving meaningful upside exposure. Given the limited global availability of prompt delivery positions of new building Cape Sizes and Newcastle maxis, particularly for 2027-2029, we believe these vessels are entering the market at a highly favorable point in the cycle. On the commercial side, our index link chartering strategy continued to outperform during the quarter with fleet time charter equivalent exceeding the BCI 180 by average approximately 6% at $24,200 per day. This figure I believe is one of the strongest of the US listed public dry bulk companies. Looking ahead, we expect the second quarter of 2026 times Hunter equivalent to be approximately $31,430 per day. In addition, 45% of our available operating days from Q2 onwards until the end of the year have already been fixed at average gross rates exceeding $29,000 per day, providing meaningful earnings visibility while preserving substantial market exposure. I will now pass the call to Stavros who will fill you in on our financial information for the quarter as well as discussing our balance sheet and debt refinancings. Stavros, please go ahead.

Stavros Giosakis

Thank you Stamatis. Our first quarter results reflected both the strength of the capesize market and the effectiveness of our commercial strategy. Net revenues reached $43 million corresponding to a time charter equivalent of 24,200 per day compared to $24.2 million and a time charter equivalent of 13,400 per day. In the same period last year adjusted EBITDA totaled $28.2 million while adjusted net income amounted to $13.4 million compared to an adjusted net loss in the prior year period, our balance sheet remains strong with cash and restricted cash totaling $68.8 million. Despite 31 million invested into the new building program during the quarter, we have already agreed approximately $237 million of financing for four of our six new buildings including pre delivery financing. While discussions for the remaining vessels are progressing constructively during the quarter, we also completed several refinancing and vessel sale transactions that further enhanced liquidity and financial flexibility or are expected expected to do so in the immediate following quarters. Our remaining new building capex for the second to fourth quarters of 2026 is approximately $72 million of which $36 million has already been paid during the second quarter, while $17 million will be sourced by pre delivery debt arrangements leaving $19 million which can be comfortably covered by our strong cash reserves, upcoming sale proceeds and operating cash flows. Total assets stood at $$640 million in book values including vessels under construction while shareholders equity amounted to $289.3 million. Total debt including liabilities under financing leases stood at $319.7 million at the end of the first quarter corresponding to a loan to value ratio of approximately 43 percent based on the market value of our fleet, reflecting our controlled approach towards leverage while advancing an ambitious fleet renewal strategy. Before moving on, let me briefly highlight our financing activity. Over the past months we secured several refinancings and new facilities that enhanced liquidity, lowered borrowing costs and extended our maturity profile. Importantly, we secured attractive financing for multiple new buildings including pre delivery funding, while maintaining limited covenant restrictions and enhanced flexibility. These actions reinforce the strength of our balance sheet and support the disciplined execution of our first renewal strategy. Lastly, concerning our future profitability at current FFA levels, we expect our platform to continue generating strong cash flow and earnings through the remainder of 2026. The combination of index linked exposure, improving charter coverage and operating leverage position synergy to benefit materially from continued strength in the Capesize market. Overall, synergy remains very well positioned financially and operationally with strong liquidity, improving earnings visibility and a disciplined approach to growth and capital allocation. We believe we are very well placed to continue delivering attractive shareholder returns while maintaining meaningful exposure to market upside. I will now pass the call back to Stamatis who will discuss the capesized market and industry fundamentals.

Stamatis Tsantanis

Stamati thank you Stavros the Capesize market has started 2026 off in a very strong manner. The first quarter was one of the strongest recorded in recent years driven by exceptionally strong bauxite volumes as well as counter seasonal iron ore export strength driven by combination of drier weather and healthy end user demand. Lastly, strong growth in grain trading also complemented Capesize strength by supporting the earnings of smaller dry bulk vessels and reducing an incentive for cargo splitting tonnage substitution. The strong trend has clearly carried over to the second quarter of the year and it appears for the rest of the year as well, driven by combination of factors. Specifically, slower vessel sailing speeds during the high bunker prices and higher port waiting times are contributing to a dearth of available vessels during a period with strong cargo demand. Looking to the rest of the current year, we obviously must acknowledge the complicated geopolitical picture which is a source of uncertainty, but we even so remain optimistic about cargo demand. We expect seaborne coal volume growth as energy security and reliability take center stage during the Middle East conflicts amidst stronger stocking demand ahead of warm summer months. Iron ore seaborne trade remains supported due to expansion of supply of high quality iron ore production in Brazil and West Africa. Looking at the supply side, the backdrop remains positive for the balance of 2026 with little expected to change in the short term. The extensive dry docking requirements of the Capesize fleet are curtailing supply meaningfully as more than 20 percent of Capesize vessels were built in 2011 and 2012 are now due for scheduled surveys within 2027 and 2027. Longer term, the Capesize order book is about 13 to 14 percent of the existing fleet compared to about 9 percent of the fleet being 20 years or older while factoring in the rapid fleet aging along with the efficiency losses associated with older vessels. Ultimately, fleet growth over the next years should remain very manageable and might even see effective fleet reduction. The Cape size outlook remains very strong for the next years and as mentioned earlier in the call, Synergy maintains downside protection for 2026 at highly profitable daily rates, which we believe places in a very good position to navigate the future. To conclude, Synergy is entering the remainder of 2026 from a position of strength supported by strong earnings visibility, disciplined capital allocation and a modernizing fleet. We remain focused on generating attractive shareholder returns while maintaining balance sheet discipline and positioning the company to benefit from a structurally supportive 2027-2029 market environment. On that note, I would like to turn the call over to the operator and take any questions you may have. Operator, please take the call. Thank you.

OPERATOR

Thank you. Dear participants, As a reminder to ask a question, you need to press star 1-1 on your telephone and wait for a name to be announced. Please stand by while we compile the Q&A roster. This will take a few moments. And now we're going to Take our first question and it comes line of Liam Burke of B. Riley Securities. Your line is open. Please ask your question.

Liam Burke (Equity Analyst)

Fine, thank you. Hello, Stamatis. Stavros, how are you today? Hello Liam, good morning, everything's fine. Nice to hear from you. Thank you. Good hearing from you too. And nice quarter. Can we go into the macro again for a second? We talked about bauxite and iron ore. Can we just take it into two pieces? The sustainability of those volumes and how has coal, the increased consumption of coal contributed to the favorable rate environment? Well, it's a combination of things. Number one, you have the increased iron ore cargoes which are not so much increased as last year, but they're pretty similar year on year. So we're very happy with these volumes. Bauxite is also increased and I think that we will continue to see increases on the bauxite as well. Coal, like you very well said, has come into play because of restocking of reserves in the Far east, especially China. There's 30 million tonnes of restocking in China and various other factors in different places. So coal has come strongly into play. So we do not see any slowing down of demand anytime soon. We think that demand will be stable next few years. But what actually tips the scale to our favor is the fact that we have the effective vessel supply is reducing because there's a lot of congestion in various areas of the world. And don't forget that even though the new building order book of the Capesize fleet has been increasing, it's still one of the lowest across the mainstream sectors of shipping. But most importantly, we have an aging fleet. So we expect hundreds of ships to turn 20 years old from 26, 27, 28 and 29. And new building order books nowhere close to compensate for the loss of tonnes that we will experience over the next few years. So it's a sustainable freight rate environment in our opinion, not only because demand will continue to be very strong or even stable, but it's going to be a supply driven growth as far as the freight rates are concerned, not just from the actual numerical supply of ships, but also from the effective supply of vessels that is going to be reducing in our view. Great, thank you. And Stavros, I apologize in advance for making you repeat this, but could you give us the cadence of Capex for the balance of the year? I know you gave it once, I didn't quite get it. And any color on 27 when you see the timing of delivery? Sure, no problem at all. So, good morning Liam. Also from my side So I mean we have paid the lion shares of the Capex that is basically to be sourced by equity for the new buildings for 2026. What is remaining is 72 million. From 72 million was actually Q2 to Q4 capex. We have already paid 36 million of this in the second quarter and 17 million will be sourced by pre delivery financing. So that leaves us to finance through equity 19 million which can be very comfortably covered by our current cash reserves and the very strong operating cash flow that the company has right now. Great. Okay, thank you very much. Thank you Liam.

OPERATOR

Thank you. Now we're going to take our next question. And the question comes of Mark Reichman from Noble Capital Markets. Your line is open. Please ask your question.

Mark Reichman (Equity Analyst)

Thank you. So management highlighted the expectations for the multi year charter agreements with the downside protection and profitability sharing mechanisms for the new builds. So how advanced are discussions with charters and what level of charter coverage do you expect prior to vessel delivery? Well, we certainly want to have something that is going to be, if not significantly above the cash flow breakeven, but quite above the cash flow breakeven. So that's going to be the base rate. Then we will have the first part from the base rate until the sealing that is going to be 100 percent for the company and then it's going to be a 50/50 percent split between us and the charter from the ceiling and thereafter. So we find this extremely advantageous because it covers the downside for the period of at least four years or five years. We are negotiating that now. And as far as certainty is concerned, you can really count that a big portion of the fleet of the new building order book will be covered well before going to the delivery of the ships. So how do you kind of view the trade off between locking in the strong forward rates versus maintaining exposure to potential market upside? Well, we have a good fleet of 20 ships in the water right now that are pretty much exposed to the upside of the market and we're very content with that. As you can see, we are among the first, if the first in reporting the highest TCE and EPS among the dry bulk shipping companies. I think we have the highest EPS among the dry bulk shipping companies with the fleet that we have right now. And our time sat equivalent is either the first or the second among the dry bulk shipping companies. So we're very content with the fleet that we have already in the water as far as new buildings are concerned. We are, you know, we don't want to take any risks. We have half a Billion dollars, close to half a billion dollars of order book. And we want to make sure that this investment is sustainable. So yes, we might give away some of the upside, but, you know, we might have some give away some of the upside, but we want to make sure that the investment is sustainable for the next five years at least once we get delivery. As far as the existing fleet is concerned, we have 50% covered in FFAs until the year end at around $29,000 a day. So we're also happy with that. I mean, we're not greedy. We want to make sure that we're covered on the downside and we will deliver one of the best possible upsides from all the dry bulk shipping companies out there. So we're very happy with that. And then could you maybe provide a little more detail detail on expected leverage levels and financing plans for the remaining vessels, you know, while you kind of maintain that balance sheet flexibility. Yes. Hi, Mark, this is Avros. I mean, we're targeting, leveraging the new building contracts 70 to 75%. So the equity participation will be 25 to 30% in each ship. That's in line with what we have done already now on four out of the six ships. This combined with the time charter structure that Samatis described before. So downside protection in the sense that we will be definitely covering the breakevens, provide certainty as to the due servicing of the dead from these ships. And at the same time, I mean, as we aggressively repay the indebtedness of the existing fleet, we expect to maintain the 50% threshold on corporate and fleet level going forward. To give you an idea, we have ships now, some of our ships are at a loan to value between 20 and 30%. So basically, on average, we will be maintaining the same LTV that you see today. Thank you. And then just the last question on vessel operating expenses. What are your expectations for operating cost inflation, say like over the next 12 to 24 months? And I'm kind of referring to the crewing, the maintenance, the regulatory compliance costs, et cetera. Yeah, well, we expect to be around $7,000 to $7,200 per shipper day. And we are kind of satisfied with this number because our ships are middle aged, they're around 14 years old as a global fleet average. We do extensive maintenance on the vessels. But don't forget that we have the highest book value per deadweight ton among the peers. The lowest. Sorry, we have the lowest book value per deadweight ton among the peers, which means that we have bought our ships quite cheap in Order to maintain them in good quality, we have to pay a little bit more. But, you know, paying a bit more on the OPEX doesn't really compensate the fact that, you know, we saved millions of dollars in acquiring those vessels cheaper. Right, so you said 7,000 to 7,200. Yes. Yeah. Which is in line with the performance of 2025. And it's not much different. I mean, the ships are not getting any younger. Right, right. Well, great. No, that's very helpful. Thank you very much. Thank you.

OPERATOR

Thank you. Now we're going to take our next question. And the question comes line of Justin Smith of Maxim Group. Your line is open. Please ask a question.

Justin Smith

Hi, good morning, guys. This is Justin on for Tate this morning. My question was just about the dividend. And with all the new build capital commitments you guys have, if you're anticipating sustaining the dividend payments you guys have been making every quarter here going forward, or if you see any change to that. Thank you. Well, good morning and nice to hear from you. The answer is yes, of course we will try and maintain. We have a formula out there, and for us, you know, rewarding our shareholders is as important as renewing our fleet is actually top important for us as a top priority to reward our shareholders. So that goes without saying that our intention is to continue rewarding our shareholders, subject, of course, to the formula and the cash flow that we have already declared. All right, great. Thank you very much. I appreciate it. Thank you. Have a great day.

OPERATOR

Thank you. Dear speakers, there are no more questions for today. This concludes today's conference call. Thank you for participating. You may now all disconnect. Have a nice day.

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