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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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Higher bunker prices drive up voyage costs as Eagle Bulk posts another loss

08 Aug 2017 06:05 GMT

Q2 loss recorded despite 109.6% jump in revenue.



Eagle Bulk Shipping Inc. reports that the increase in bunker prices was one of two key factors that contributed towards the jump in voyage expenses during the second quarter (Q2) of 2017.

In Q2, Eagle Bulk saw voyage expenses rise $5.9 million, or 78.7 percent, to $13.4 million compared to the corresponding period last year.

Explaining the reason for the rise, Eagle Bulk said it was "mainly attributable to an increase in the number of freight voyages in the current quarter compared to the comparable quarter in the prior year as well as increased bunker prices year over year".

In Q1, Eagle Bulk had seen voyage expenses increase $4.2 million, or 45.7 percent year-on-year (YoY) to $13.4 million. The dry bulk owner-operator also explained at the time that the rise was due to higher bunker prices and more freight voyages.

The same reasons were also given for the 76.9 percent jump in voyage expenses in 2016 (from $23.8 million to $42.1 million) compared to the previous year, and the 37.9 percent Q4 2016 increase (from $10.3 million to $14.2 million).

Net loss

In its overall results for Q2, Eagle Bulk posted a net loss of $5.9 million compared to the previous year's $22.5 million net loss. This was despite a revenue rise of $28.0 million, or 109.6 percent to $53.6 million.

For the first half (H1) of 2017, Eagle Bulk's net loss was $17.0 million compared to $61.8 million last year. Revenue increased $52.6 million, or 112.3 percent, to $99.5 million.

As of June 30, Eagle Bulk's cash and cash equivalents balance was $68.7 million, compared to a cash and cash equivalents balance of $76.5 million as of December 31, 2016. The company's total availability in the revolving credit facility under the First Lien Facility was $25.0 million.

As of June 30 the company's debt consisted of $203.8 million in term loans, net of $3.9 million of debt discount and deferred financing costs; the Second Lien Facility of $72.3 million, net of $13.7 million of debt discount; and deferred financing costs and the Ultraco Debt Facility of $40.0 million, net of $1.5 million of debt discount and deferred financing costs.

Commenting on the results, Gary Vogel, Eagle Bulk's CEO, said "During the second quarter, we delivered results that affirm the inherent potential of our active management model, as well as tangible progress towards Eagle Bulk's larger goal of becoming the premier owner-operator of Supramax / Ultramax vessels. This progress is reflected in quarterly performance well in excess of the Baltic Supramax Index and in our continued fleet growth and optimization. Importantly, these positive developments are occurring against the backdrop of continued improvement in the dry bulk market itself with respect to both trade demand and vessel supply fundamentals."






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Higher bunker prices cause voyage costs to rise: Eagle Bulk

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