Today's news was that DSX, Diana Shipping, signed $9,400 per day one year lease for a Panamax with Cargill. The BDI today showed a spot market rate of $4482 per day for a Panamax. This is the third lease by Cargill I have seen in the news the past week, for long term charters at rates well above the BDI spot market rates, which means Cargill believes the rates will go back up very soon, or at least that they have bottomed. And the bottom today for the Cape is already nearly 3 times above the low in the fourth quarter of last year. I also noted that the charter was only for 11-14 months, which to me means DSX expects average rates to be higher by then.
Genco Shipping had news today that it has amended its 1.4 billion dollar credit facility. While it still plans to receive it's 3 new Cape size newbuild ships later this year and has confirmed the credit line to pay for them, it has been forced to suspend it's dividend until it has proven that it can once again satisfied its collateral maintenance facility with the bank. I am assuming that the bank has devalued the current ships collateral value thus breaking the earlier loan covenant.
Bad news, the Genco dividend is gone for now. Good news, the Bank is going to work with them, including completing the purchase of 3 new Cape ships this year.
The BDI was up again today +15 reaching 995, with the Panamax index up 5%.
I am starting to wonder if any of the shippers are going to keep their dividends?
Genco and Diana Shipping were both up 7 to 10% today in trading, as was EXM.
PRGN and SB were up several percent, but not by as much as the others. Dry Ships is still trying to defy gravity, on what I consider to be a dead cat bounce.
I went through the Paragon Shipping web sites online financials today and could not find any good reason to temper my belief that they might be one of the few dry bulk shippers to maintain their dividend at least at some level, and I expect them to report a healthy profit, as there has been no bad news about them, and most of their ships have healthy long term charter rates. They reported in the third quarter that they already had 85% charters for 2009, and 100% for the remaining quarter of 2008. Add to that an increased .50 cent quarterly dividend on a $5.39 a share stock, and all I can ask is:
"What's in your walllet?"
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