The Greek owner and operator of container vessels Euroseas Ltd. has announced two new consecutive time charter contracts for its 2009-built Synergy Oakland, as well as the acquisition and charter of the 6,350TEU Leo Paramount.
Firstly, the company has agreed to a new time charter contract for Synergy Oakland, for a period of between two and three months at a daily rate of US$130,000, commencing between 5 and 25 January, when the 4,253TEU vessel will be redelivered from its current charterer in the fleet of Euroseas.
Immediately following the completion of the above charter, Euroseas will conduct a new time charter contract for a period of a minimum of 48 and a maximum of 51 months, depending on the charterer’s option.
The minimum four-year charter, which will be effective the latest by 15 April, when the Panamax container ship will be redelivered from its previous charterer, is projected to be at a rate of US$42,000 per day, according to a statement.
As a result of these charters, Synergy Oakland is expected to make an Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) contribution of about US$11.5 million during the first quarter of 2022 and about US$12 million per year during each of the next four years, totalling about US$57 million of EBITDA contribution, or about US$7.80 per share, over the duration of its new charters, according to Aristides Pittas, Chairman and CEO of Euroseas.
“We expect to be able to continue benefitting from the present market as there are another four of our vessels in our fleet which open for re-chartering within the next four months and another two vessels later within 2022,” said Pittas.
Regarding the acquisition of the Post-Panamax Leo Paramount that was built in 2005, it is expected to be delivered to Euroseas’ fleet within 2021 and it is intended to be renamed “Marcos V.”
In addition, the 6,350TEU boxship which will be acquired for US$40 million, will be financed by own funds and a bank loan. Meanwhile, the vessel will enter into a three-year time charter contract at a daily rate of US$42,200 with a possible extension for an additional year at the option of the charterer at US$15,000 per day, according to the Greek company.
“The charter contract we have entered into with a first-class charterer is expected to contribute about US$35 million of EBITDA during the first three years of the contract providing us with a significant return on our investment,” commented Pittas who went on to point out that “depending on the market after the end of the charter in three or four years we may have significant additional upside.”
The CEO of the company added, “With a fleet of sixteen feeder and intermediate containerships on the water, after the delivery of the above vessel, and two modern feeder newbuildings expected to be delivered in the first half of 2023, Euroseas reinforces its position as the main US publicly listed company focusing on feeder and intermediate container vessels.”
