Genco Shipping & Trading Limited Announces Plan to Sign Time Charter for Capesize Vessel

Oct 12, 2010, 16:40 ET from Genco Shipping & Trading Limited

NEW YORK, Oct. 12 /PRNewswire/ -- Genco Shipping & Trading Limited (NYSE: GNK) today announced that it has reached an agreement to enter into a time charter for the Genco Tiberius, a 2007-built Capesize vessel, with Cargill International S.A. for 11 to 14.5 months at a rate of $31,000 per day, less a 5% third-party brokerage commission.

The time charter for the Genco Tiberius is expected to commence on or about October 14, 2010 and is subject to the completion of definitive documentation.

The following table reflects the current employment of Genco's current fleet:

Vessel(1)

Year Built

Charterer

Charter Expiration (2)

Cash Daily Rate (3)

Net Revenue Daily Rate (4)

Capesize Vessels

Genco Augustus

2007

Cargill International S.A.

December 2010

39,000

Genco Tiberius

2007

Cargill International S.A.

September 2011

31,000

Genco London

2007

Cargill International S.A.

October 2010

26,000

Genco Titus

2007

Cargill International S.A.

September 2011

45,000(5)

46,250

Genco Constantine

2008

Cargill International S.A.

August 2012

52,750(5)

Genco Hadrian

2008

Cargill International S.A.

October 2012

65,000(5)

Genco Commodus

2009

Morgan Stanley Capital Group Inc.

June 2011

36,000

Genco Maximus

2009

Cargill International S.A.

November 2010

27,000

Genco Claudius

2010

Cargill International S.A.

November 2010

36,000

Panamax Vessels

Genco Beauty

1999

D/S Norden A/S, Copenhagen

April 2011

27,000

Genco Knight

1999

Swissmarine Services S.A.

March 2011

25,000

Genco Leader

 1999

Klaveness Chartering

December 2010

20,000

Genco Vigour

 1999

Global Maritime Investments Ltd.

November 2010

24,000

Genco Acheron

 1999

Global Chartering Ltd (a subsidiary of ArcelorMittal Group)

July 2011

55,250

Genco Surprise

 1998

Hanjin Shipping Co., Ltd.

December 2010

42,100

Genco Raptor

 2007

COSCO Bulk Carriers Co., Ltd.

April 2012

52,800

Genco Thunder

 2007

Klaveness Chartering

 November 2010

22,250

Supramax Vessels

Genco Predator

 2005

Pacific Basin Chartering Ltd.

April 2011

22,500

Genco Warrior

 2005

Hyundai Merchant Marine Co. Ltd.

November 2010

38,750

Genco Hunter

 2007

Pacific Basin Chartering Ltd.

February 2011

21,750

Genco Cavalier

 2007

MUR Shipping B.V.

 September 2011

19,200

Genco Lorraine

 2009

Olam International Ltd.

June, 2012

18,500

Genco Loire

 2009

Oldendorff GMBH and Co.

August, 2011

20,250

Genco Aquitaine

 2009

Samsun Logix Corporation

March, 2011

21,250 (9)

(8)

Genco Ardennes

 2009

Klaveness Chartering

August, 2012

19,000

Genco Auvergne

 2009

Oldendorff GMBH and Co.

November, 2010

22,000

Genco Bourgogne

 2010

Setaf-Saget SAS

November, 2011

19,900

Genco Brittany

 2010

Oldendorff GMBH and Co.

December, 2010

21,000

Genco Languedoc

 2010

Setaf-Saget SAS

December, 2010

24,250

Genco Normandy

 2007

STX Pan Ocean Co. Ltd.

October, 2010

20,000

Genco Picardy

 2005

Rizzo-Bottiglieri-de Carlini Armatori SPA

November, 2010

17,100

(8)

Genco Provence

 2004

Setaf-Saget SAS

December, 2011

20,250

Genco Pyrenees

 2010

Setaf-Saget SAS

July, 2011

19,000

Handymax Vessels

Genco Success

 1997

Korea Line Corporation

February 2011

33,000(6)

Genco Carrier

 1998

Louis Dreyfus Corporation

March 2011

37,000

Genco Prosperity

 1997

Pacific Basin Chartering Ltd

June 2011

37,000

Genco Wisdom

 1997

Hyundai Merchant Marine Co. Ltd.

February 2011

34,500

Genco Marine

 1996

STX Pan Ocean Co. Ltd.

April 2011

20,000

Genco Muse

 2001

Global Maritime Investments Ltd.

December 2010

17,750

Handysize Vessels

Genco Explorer

 1999

Lauritzen Bulkers A/S

January 2011

Spot(7)

Genco Pioneer

   1999

Lauritzen Bulkers A/S

January 2011

Spot(7)

Genco Progress

   1999

Lauritzen Bulkers A/S

October 2011

Spot(7)

Genco Reliance

   1999

Lauritzen Bulkers A/S

October 2011

Spot(7)

Genco Sugar

   1998

Lauritzen Bulkers A/S

October 2011

Spot(7)

Genco Charger

   2005

Pacific Basin Chartering Ltd.

November 2010

24,000

Genco Challenger

   2003

Pacific Basin Chartering Ltd.

November 2010

24,000

Genco Champion

   2006

Pacific Basin Chartering Ltd.

December 2010

24,000

Genco Ocean

2010

Cargill International S.A.

June, 2013

$8,500-$13,500 with 50% profit sharing (10)

Genco Bay

 2010

Cargill International S.A.

February, 2013

$8,500-$13,500 with 50% profit sharing (10)

Vessels to be Delivered

Supramax Vessels

Genco Rhone

  2011 (11)

Handysize Vessels

Genco Avra

  2011 (11)

Cargill International S.A.

34.5-37.5 months after delivery

$8,500-$13,500 with 50% profit sharing (10)

Genco Mare

 2011 (11)

Cargill International S.A.

45.5-50.5 months after delivery

BHSI plus 15% (12)

Genco Spirit

 2011 (11)

Cargill International S.A.

34.5-37.5 months after delivery

$8,500-$13,500 with 50% profit sharing (10)

(1) References to Genco's vessels and fleet in this press release exclude vessels owned by Genco's subsidiary, Baltic Trading Limited.

(2) The charter expiration dates presented represent the earliest dates that our charters may be terminated in the ordinary course.  Except for the Genco Titus, Genco Constantine, and Genco Hadrian under the terms of each contract, the charterer is entitled to extend the time charters from two to four months in order to complete the vessel's final voyage plus any time the vessel has been off-hire. The charterer of the Genco Titus and Genco Hadrian has the option to extend the charter for a period of one year.  The Genco Constantine has the option to extend the charter for a period of eight months.  

(3) Time charter rates presented are the gross daily charterhire rates before third-party commissions generally ranging from 1.25% to 6.25%. In a time charter, the charterer is responsible for voyage expenses such as bunkers, port expenses, agents' fees and canal dues.

(4) For the vessels acquired with a below-market time charter rate, the approximate amount of revenue on a daily basis to be recognized as revenues is displayed in the column named ''Net Revenue Daily Rate'' and is net of any third-party commissions. Since these vessels were acquired with existing time charters with below-market rates, Genco allocated the purchase price between the respective vessels and an intangible liability for the value assigned to the below-market charter-hire. This intangible liability is amortized as an increase to voyage revenues over the minimum remaining terms of the applicable charters. The minimum remaining term for the Genco Titus on September 26, 2011, at which point the respective liabilities were or will be amortized to zero and the vessels began or will begin earning the ''Cash Daily Rate.'' For cash flow purposes, Genco will continue to receive the rate presented in the ''Cash Daily Rate'' column until the charter expires.

(5) The charter expiration dates presented represent the earliest dates that the charters may be terminated in the ordinary course, in accordance with their respective terms. Except for the Genco Titus, Genco Constantine and Genco Hadrian, under the terms of each contract, the charterer is entitled to extend the time charters from two to four months in order to complete the vessel's final voyage plus any time the vessel has been off-hire. The charterer of the Genco Titus and Genco Hadrian has the option to extend the charter for a period of one year. The Genco Constantine has the option to extend the charter for a period of eight months.

(6) We extended the time charter for an additional 35 to 37.5 months at a rate of $40,000 per day for the first 12 months, $33,000 per day for the following 12 months, $26,000 per day for the next 12 months and $33,000 per day thereafter less a 5% third-party commission. In all cases, the rate for the duration of the time charter will average $33,000 per day. For purposes of revenue recognition, the time charter contract is reflected on a straight-line basis at approximately $33,000 per day for 35 to 37.5 months in accordance with U.S. GAAP.

(7) We have reached an agreement to enter these vessels into the LB/IVS Pool whereby Lauritzen Bulkers A/S acts as the pool manager. We can withdraw up to two vessels with three months' notice and the remaining three vessels with 12 months' notice.

(8) Since these vessels were acquired with existing time charters with market or below-market rates. For the time charters that are below-market, Genco is in the process of allocating the purchase price between the respective vessels and an intangible liability for the value assigned to the below-market charter-hire. This intangible liability will be amortized as an increase to voyage revenues over the minimum remaining terms of the applicable charters, at which point the respective liabilities will be amortized to zero and the vessels will begin earning the ''Cash Daily Rate.'' For cash flow purposes, Genco will continue to receive the rate presented in the ''Cash Daily Rate'' column until the charter expires.

(9) A novation agreement was signed between Genco and Samsun Logix Corporation at a rate of $20,000 per day, less a 5% third party brokerage commission, with a minimum expiration of March 2011 and a maximum expiration of May 2011. The charter includes a 50% hire-based profit sharing component on the difference between the rate mentioned above and the rate that the charterer has sub-chartered the vessel at for the remainder of the contract's life. The gross effective rate for the duration of this charter is approximately $21,250 per day.

(10) The rate for the spot market-related time charter will be linked with a floor of $8,500 and a ceiling of $13,500 daily with a 50% profit sharing arrangement to apply to any amount above the ceiling. The rate will be based on 115% of the average of the daily rates of the Baltic Handysize Index, or BHSI, as reflected in daily reports. Hire will be paid every 15 days in advance net of a 5.00% third party brokerage commission.

(11) Built & delivery dates for vessels being delivered in the future are estimates based on guidance received from the sellers and/or the respective shipyards.

(12) The rate for the spot market-related time charter will be based on 115% of the average of the daily rates of the BHSI, as reflected in daily reports. Hire will be paid every 15 days in advance net of a 5.00% third party brokerage commission.

About Genco Shipping & Trading Limited

Genco Shipping & Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Genco currently owns a fleet of 49 drybulk vessels, consisting of nine Capesize, eight Panamax, sixteen Supramax, six Handymax and ten Handysize vessels, with an aggregate carrying capacity of approximately 3,649,000 dwt. After the expected delivery of three remaining Handysize vessels and one remaining Supramax vessel that Genco has agreed to acquire and retain, Genco will own a fleet of 53 drybulk vessels, consisting of nine Capesize, eight Panamax, seventeen Supramax, six Handymax, and thirteen Handysize vessels with a total carrying capacity of approximately 3,812,000 dwt. References to Genco's vessels and fleet in this press release exclude vessels owned by Baltic Trading Limited, a subsidiary of Genco.

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements with respect to the commencement of time charters and are based on management's current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this press release are the following: the completion of definitive documentation with respect to time charters; and other factors listed from time to time under "Risk Factors" and other sections of our public filings with the Securities and Exchange Commission including, without limitation, the Company's Annual Report on Form 10-K for the year ended December 31, 2009 and its subsequently filed reports on Form 10-Q and Form 8-K.

SOURCE Genco Shipping & Trading Limited