The Wolfson Centre for Bulk Solids Handling Technology

Golden Ocean maintains exposure to soaring spot market

(Posted on 27/08/21)

Dry bulk shipping company Golden Ocean Group Limited has announced its results for the quarter ended June 30, 2021 with Ulrik Andersen, Chief Executive Officer “excited about what lies ahead”.

Anderson said, ““Golden Ocean’s result for the second quarter of 2021 reflects the dry bulk market’s strong underlying fundamentals, but also our strategy of maintaining a significant portion of our fleet exposed to the spot market. As pleased as we are with the net profit for the second quarter of 2021, we are more excited about what lies ahead. Our longer-term market outlook is positive based on the pace of the growth in the demand, coupled with slowing fleet growth through at least 2023. While in the short term, port and supply chain inefficiencies will continue to result in rate volatility and periods of exceptionally strong rates.

As evidenced this quarter with a $0.50 per share dividend, Golden Ocean intends to pay out a significant portion of the earnings. With no material capital expenses, no debt maturities or vessels on order, Golden Ocean, as the largest listed owner in the world, is well-positioned to continue to generate significant cash flows to the benefit of the shareholders.”

Highlights from the announcement include:

Net income of $104.5 million and earnings per share of $0.52 for the second quarter of 2021 compared with net income of $23.6 million and earnings per share of $0.14 for the first quarter of 2021

Adjusted EBITDA of $130.5 million for the second quarter of 2021, compared with $54.6 million for the first quarter of 2021

Reported TCE rates for Capesize and Panamax/Ultramax vessels of $29,372 per day and $18,987 per day, respectively, in the second quarter of 2021. Reported TCE rate for the whole fleet of $24,920 per day

Completed the previously announced acquisitions of 15 modern dry bulk vessels and three newbuildings, all of which have been delivered as of the date of this report

Signed agreements to refinance existing credit facility with Sterna Finance, securing up to $435 million of new long-term financing. The highly attractive terms of the refinancing will lower the average cash break even rate for the acquired vessels with an estimated $415 per day

Converted time charters from floating rates to average fixed rates of $33,250 gross until the second quarter of 2022 for three Capesize vessels (180k dwt)

In August 2021 terminated relationship with Capesize Chartering Ltd, taking full control of the Company’s commercial activities on the Capesize vessels