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

Increases Time Charter Coverage to 57% for 2010

Jan 15, 2010, 08:30 ET from Genco Shipping & Trading Limited

NEW YORK, Jan. 15 /PRNewswire-FirstCall/ -- Genco Shipping & Trading Limited (NYSE: GNK) today announced that it has reached an agreement to enter into a time charter for the Genco Augustus, a 2007-built Capesize vessel, with Cargill International S.A. for approximately 10.5 to 12.5 months at a rate of $39,000 per day, less a 5% third-party brokerage commission.

The time charter for the Genco Augustus is subject to the completion of definitive documentation and is expected to commence on or about January 23, 2010 following the vessel's scheduled drydocking. The previous time charter for the Genco Augustus was completed on January 10, 2010.

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

Vessel

Year

Built

Charterer

Charter Expiration (1)

Cash Daily

Rate (2)

Net Revenue Daily Rate (3)

Capesize Vessels

Genco Augustus

2007

Cargill International S.A.

December 2010

39,000

Genco Tiberius

2007

Cargill International S.A.

February 2010

45,263

62,750

Genco London

2007

SK Shipping Co., Ltd

August 2010

57,500

64,250

Genco Titus

2007

Cargill International S.A.

September 2011

45,000(4)

46,250

Genco Constantine

2008

Cargill International S.A.

August 2012

52,750(4)

Genco Hadrian

2008

Cargill International S.A.

October 2012

65,000(4)

Genco Commodus

2009

Morgan Stanley Capital Group Inc.

June 2011

 36,000

Genco Maximus

2009

Cargill International S.A.

February 2010

 31,750

Genco Claudius

2010

Cargill International S.A.

November 2010

 36,000(5)

Panamax Vessels

Genco Beauty

1999

LD Commodities Suisse, Geneva

March 2010

19,125

Genco Knight

1999

Swissmarine Services S.A.

February 2010

16,500

Genco Leader

 1999

Baumarine AS/Klaveness Chartering

Jan 10/Dec 10

20,742/20,000(6)

Genco Vigour

 1999

Global Maritime Investments Ltd.

November 10

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

March 2010

20,000

Supramax Vessels

Genco Predator

 2005

Bulkhandling Handymax A/S

April 2010

Spot(7)

Genco Warrior

 2005

Hyundai Merchant Marine Co. Ltd.

November 2010

38,750

Genco Hunter

 2007

Pacific Basin Chartering Ltd.

February 2010

17,000

Genco Cavalier

 2007

Clipper Bulk Shipping NV

 February 2010

16,750

Handymax Vessels

Genco Success

 1997

Korea Line Corporation

February 2011

33,000(8)

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.

February 2010

15,500

Genco Muse

 2001

Global Maritime Investments Ltd.

January 2010

15,000

Handysize Vessels

Genco Explorer

 1999

Lauritzen Bulkers A/S

April 2010

Spot(9)

Genco Pioneer

   1999

Lauritzen Bulkers A/S

April 2010

Spot(9)

Genco Progress

   1999

Lauritzen Bulkers A/S

January 2011

Spot(9)

Genco Reliance

   1999

Lauritzen Bulkers A/S

January 2011

Spot(9)

Genco Sugar

   1998

Lauritzen Bulkers A/S

January 2011

Spot(9)

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

(1) 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.  

(2) Time charter rates presented are the gross daily charterhire rates before third-party commissions 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.  

(3) 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, we allocated the purchase price between the respective vessels and an intangible liability for the value assigned to the below-market charterhire.  This intangible liability is amortized as an increase to voyage revenues over the minimum remaining term of the charter.  For cash flow purposes, we will continue to receive the rate presented in the "Cash Daily Rate" column until the charter expires.  

(4) These charters include a 50% index-based profit sharing component above the respective base rates listed in the table. The profit sharing between the charterer and us for each 15-day period is calculated by taking the average over that period of the published Baltic Cape Index of the four time charter routes, as reflected in daily reports. If such average is more than the base rate payable under the charter, the excess amount is allocable 50% to each of the charterer and us. A third-party brokerage commission of 3.75% based on the profit sharing amount due to us is payable out of our share.

(5) We have reached an agreement to charter the vessel for 10.5 to 13.5 months at a rate of $36,000 per day, less a 5% third-party commission and commenced on January 4, 2010.

(6) We reached an agreement to enter the vessel into the Baumarine Pool with an option to convert the balance period of the charter party to a fixed rate, but only after June 1, 2009. We exercised the option to convert the balance period of the charter party to a fixed rate on June 3, 2009 at a gross rate of $20,742 per day. We further reached an agreement to charter the vessel for 10.5 to 13.5 months at a rate of $20,000 per day, less a 5% third-party commission. The vessel is expected to enter into the time charter following the completion of its previous time charter on or about January 16, 2010.

(7) We entered the vessel into the Bulkhandling Handymax Pool with an option to convert the balance period of the charter party to a fixed rate, but only after January 1, 2009. We extended the charter party by an additional 5 to 7.5 months starting November 5, 2009. In addition to a 1.25% third-party brokerage commission, the charter party calls for a management fee.

(8) 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.

(9) We have reached an agreement to enter these vessels into a spot pool managed by Lauritzen Bulkers beginning at the expiration of their current time charters in August 2009. Under the pool agreement, we can withdraw up to three vessels with three months' notice until December 31, 2009 and the remaining two vessels with 12 months' notice. After December 31, 2009, we can withdraw up to two vessels with three months' notice and the remaining three vessels with 12 months' notice.

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 Shipping & Trading Limited currently owns a fleet of 35 drybulk vessels, consisting of nine Capesize, eight Panamax, four Supramax, six Handymax and eight Handysize vessels, with an aggregate carrying capacity of approximately 2,903,000 dwt.

"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: (i) changes in demand or rates in the drybulk shipping industry; (ii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iii) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (iv) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (v) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, repairs, maintenance and general and administrative expenses; (vi) the adequacy of our insurance arrangements; (vii) changes in general domestic and international political conditions; (viii) changes in the condition of the Company's vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (ix) the number of offhire days needed to complete repairs on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims including offhire days; (x) the Company's acquisition or disposition of vessels; 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, 2008 and its subsequently filed reports on Form 10-Q and Form 8-K.  

SOURCE Genco Shipping & Trading Limited