Euroseas Ltd. Announces Delivery of M/V Tender Soul, an Eco 2,800 teu Feeder Containership Newbuilding, and Commencement of the Vessel’s Charter
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Insights
The delivery of the M/V Tender Soul by Euroseas Ltd. represents a strategic expansion of their fleet, specifically targeting the eco-friendly segment of the shipping market. The mention of the vessel being '40%+ more efficient' than non-eco ships is a significant figure, as it positions the company to benefit from increasingly stringent environmental regulations and shifting industry norms towards sustainability. This efficiency can translate into reduced operating costs and potentially higher profit margins, which are critical factors for investors.
Furthermore, the secured charter rate of $17,000/day for the M/V Tender Soul, while lower than some of the rates listed for other vessels in the fleet, indicates a steady revenue stream for the near term. This rate must be compared against operational costs to assess the profitability of the new vessel. The overall impact on the company's financials will depend on the performance of the entire fleet and the management's ability to strategically charter the vessels at competitive rates.
Euroseas Ltd.'s focus on acquiring vessels with Tier III engines and Alternative Maritime Power (AMP) capabilities is a proactive move in anticipation of tighter emissions regulations. Tier III engines are designed to significantly reduce nitrogen oxide emissions, a requirement in certain Emission Control Areas (ECAs). AMP, meanwhile, allows ships to shut down their diesel engines and connect to shore-side electrical power, reducing emissions while docked.
These features not only enhance the company's environmental profile but also could offer a competitive advantage as ports around the world increasingly implement regulations favoring or requiring such technologies. This could result in preferred access or reduced port fees for compliant vessels, influencing the bottom line positively.
The sale and leaseback agreement mentioned for the M/V Tender Soul is a financial maneuver that allows Euroseas Ltd. to free up capital while maintaining operational control of the vessel. This strategy can be beneficial for liquidity and enables the company to potentially invest in further expansions or reduce debt. However, it is important to analyze the terms of the agreement, as they can affect the long-term financial health of the company. High lease rates could erode profit margins, while favorable terms could bolster them.
The company's approach to monitoring the secondhand and resale markets for 'accretive investment opportunities' suggests a strategic approach to fleet management that aims to balance growth with financial prudence. The ability of the management to execute on these opportunities will be a critical factor in the company's financial performance and stock valuation.
ATHENS, Greece, Feb. 07, 2024 (GLOBE NEWSWIRE) -- Euroseas Ltd. (NASDAQ:ESEA), an owner and operator of container vessels and provider of seaborne transportation for containerized cargoes, announced today that on February 6, 2024, it has taken delivery of its M/V Tender Soul, an Eco EEDI Phase 3, 2,800 teu feeder containership newbuilding from Hyundai Mipo Dockyard Co. in South Korea. The vessel is equipped with a Tier III engine and other sustainability linked features including installation of AMP (alternative maritime power). The vessel is financed via a sale and leaseback agreement with a Japanese owner and bank. Following its delivery, M/V Tender Soul commenced an eight to ten months charter at a rate of
Aristides Pittas, Chairman and CEO of Euroseas commented: "We are very pleased to have taken delivery of M/V Tender Soul, the third vessel from our nine-vessel newbuilding program which includes three additional 2,800 teu and three 1,800 teu units, all modern fuel-efficient eco-design vessels with Tier III engines. It should be noted that M/V Tender Soul and the rest of our newbuildings are
“Thus, we look forward to the delivery of the remaining of our newbuildings that will help us reduce our carbon footprint. At the same time, we expect that the recent recovery in charter rates would benefit our vessels that are to be chartered or re-chartered in the next several months including the next scheduled deliveries from our newbuilding program. As always, we continue to monitor the secondhand and resale markets to identify accretive investment opportunities.”
Fleet Profile:
After the delivery of M/V Tender Soul, the Euroseas Ltd. fleet and employment profile will be as follows:
| Name | Type | Dwt | TEU | Year Built | Employment(*) | TCE Rate ($/day) | |
Container Carriers | |||||||
| MARCOS V(*) | Intermediate | 72,968 | 6,350 | 2005 | TC until Dec-24 TC until Aug-25 | ||
| SYNERGY BUSAN(*) | Intermediate | 50,726 | 4,253 | 2009 | TC until Aug-24 | ||
| SYNERGY ANTWERP(*) | Intermediate | 50,726 | 4,253 | 2008 | TC until Feb-24 | ||
| SYNERGY OAKLAND(*) | Intermediate | 50,787 | 4,253 | 2009 | TC until May-26 | ||
| SYNERGY KEELUNG(*) | Intermediate | 50,969 | 4,253 | 2009 | TC until Apr-25 | ||
| EMMANUEL P(*) | Intermediate | 50,796 | 4,250 | 2005 | TC until Apr-25 | ||
| RENA P(*) | Intermediate | 50,796 | 4,250 | 2007 | TC until Apr-25 | ||
| EM KEA(*) | Feeder | 42,165 | 3,100 | 2007 | TC until May-26 | ||
| GREGOS(*) | Feeder | 37,237 | 2,800 | 2023 | TC until Apr-26 | ||
| TERATAKI(*) | Feeder | 37,237 | 2,800 | 2023 | TC until Jul-26 | ||
| TENDER SOUL(*) | Feeder | 37,237 | 2,800 | 2024 | TC unitl Oct-24 | ||
| EM ASTORIA (+) | Feeder | 35,600 | 2,788 | 2004 | TC until Feb-24 then until Feb-25 | ||
| EVRIDIKI G(*) | Feeder | 34,677 | 2,556 | 2001 | TC until Feb-25 | ||
| EM CORFU(*) | Feeder | 34,654 | 2,556 | 2001 | TC until Feb-25 | ||
| DIAMANTIS P(*) | Feeder | 30,360 | 2,008 | 1998 | TC until Oct-24 | ||
| EM SPETSES(*) | Feeder | 23,224 | 1,740 | 2007 | TC until Jul-24 | ||
| JONATHAN P(*) | Feeder | 23,357 | 1,740 | 2006 | TC until Sep-24 | ||
| EM HYDRA(*) | Feeder | 23,351 | 1,740 | 2005 | TC until May-24 | ||
| JOANNA(*) | Feeder | 22,301 | 1,732 | 1999 | TC until May-24 | ||
| AEGEAN EXPRESS(*) | Feeder | 18,581 | 1,439 | 1997 | TC until Mar-24 | ||
Total Container Carriers on the Water | 20 | 777,749 | 61,661 | ||||
| Vessels under construction | Type | Dwt | TEU | To be delivered | Employment | TCE Rate ($/day) |
| LEONIDAS Z (H4237) | Feeder | 37,237 | 2,800 | Q2 2024 | ||
| MONICA (H4248) | Feeder | 22,262 | 1,800 | Q2 2024 | ||
| STEPHANIA K (H4249) | Feeder | 22,262 | 1,800 | Q2 2024 | ||
| PEPI STAR (H4250) | Feeder | 22,262 | 1,800 | Q3 2024 | ||
| DEAR PANEL (H4251) | Feeder | 37,237 | 2,800 | Q4 2024 | ||
| SYMEON P (H4252) | Feeder | 37,237 | 2,800 | Q4 2024 | ||
| Total under construction | 6 | 178,497 | 13,800 |
| Notes: | |
| (*) | TC denotes time charter. All dates listed are the earliest redelivery dates under each time charter unless the contract rate is lower than the current market rate in which cases the latest redelivery date is assumed; vessels with the latest redelivery date shown are marked by (+). |
| (**) | The CONTEX (Container Ship Time Charter Assessment Index) has been published by the Hamburg and Bremen Shipbrokers' Association (VHBS) since October 2007. The CONTEX is a company-independent index of time charter rates for container ships. It is based on assessments of the current day charter rates of six selected container ship types, which are representative of their size categories: Type 1,100 TEU and Type 1,700 TEU with a charter period of one year, and the Types 2,500, 2,700, 3,500 and 4,250 TEU all with a charter period of two years. |
| (***) | Rate is net of commissions (commissions are, typically, 5 |
About Euroseas Ltd.
Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA.
Euroseas operates in the container shipping market. Euroseas' operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.
The Company has a fleet of 20 vessels, including 13 Feeder and 7 Intermediate containerships. Euroseas 20 containerships have a cargo capacity of 61,661 teu. On a fully-delivered basis of its vessels under construction, the Company’s fleet will increase to 26 containerships with a cargo capacity of about 75,461 teu.
Forward Looking Statement
This press release contains forward-looking statements (as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) concerning future events and the Company's growth strategy and measures to implement such strategy; including expected vessel acquisitions and entering into further time charters. Words such as "expects," "intends," "plans," "believes," "anticipates," "hopes," "estimates," and variations of such words and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to changes in the demand for containerships, competitive factors in the market in which the Company operates; risks associated with operations outside the United States; and other factors listed from time to time in the Company's filings with the Securities and Exchange Commission. The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.
Visit our website www.euroseas.gr
| Company Contact | Investor Relations / Financial Media |
| Tasos Aslidis Chief Financial Officer Euroseas Ltd. 11 Canterbury Lane, Watchung, NJ 07069 Tel. (908) 301-9091 E-mail: aha@euroseas.gr | Nicolas Bornozis Markella Kara Capital Link, Inc. 230 Park Avenue, Suite 1540 New York, NY 10169 Tel. (212) 661-7566 E-mail: euroseas@capitallink.com |
FAQ
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