Q4 2025 Star Bulk Carriers Corp Earnings Call

February 26, 2026

Speaker #1: Thank you for standing by , ladies and gentlemen , and welcome to the Star Bulk Carriers Corp. conference call on the fourth quarter 2020 financial results .

Operator: Thank you for standing by, ladies and gentlemen. Welcome to the Star Bulk Carriers Conference Call on the Q4 2025 Financial results. We have with us Mr. Petros Pappas, Chief Executive Officer, Mr. Hamish Norton, President, Mr. Simos Spyrou and Mr. Christos Begleris, Co-Chief Financial Officers, Mr. Nicos Rescos, Chief Operating Officer, Constantinos Simantiras, Head of Market Analysis, and Mrs. Charis Plakantonaki, Chief Strategy Officer of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session, at which time, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded. We now pass the floor to one of your speakers today, Mr. Spyrou. Please go ahead, sir.

Speaker #1: We have with us Mr. Petros Pappas, Chief Executive Officer; Mr. Hamish Naughton, President; Mr. Simos Spyrou; and Mr. Christos Begleris.

Speaker #1: Co chief Financial Officers Mr. Nicos Rescos chief Operating Officer Konstantinos Head of Marketing Analysis and Mrs. Charis Plakantonaki . Chief Strategy Officer of the company .

Speaker #1: At this time , all participants are in a listen only mode . There will be a presentation followed by a question and answer session , at which time , if you wish to ask a question , please press star one on your telephone keypad and wait for your name to be announced I must advise you that this conference is being recorded .

Speaker #1: We now pass the floor to one of your speakers today . Mr. Spirou , please go ahead , sir .

Speaker #2: Thank you . Operator Good morning , ladies and gentlemen , and thank you for joining us today . I am Simos Spyrou Co Chief Financial Officer of Star Bulk Carriers Corp.

Simos Spyrou: Thank you, operator. Good morning, ladies and gentlemen, and thank you for joining us today. I'm Simos Spyrou, Co-Chief Financial Officer of Star Bulk Carriers. I would like to welcome you to our conference call regarding our Financial Results for the Q4 2025. Before we begin, I kindly ask you to take a moment to read the safe harbor statement on slide number 2 of our presentation. In today's presentation, we will review our Q4 2025 company highlights, financial performance, capital allocation initiatives, cash evolution during the quarter, operational performance, our continued investments in the fleet, developments on the regulatory front, and our perspective on industry fundamentals. We will open the floor for questions. Turning to slide 3. The Q4 was characterized by solid profitability, disciplined capital allocation, and continued balance sheet strength.

Speaker #2: , and I would like to welcome you to our conference call regarding our financial results for the fourth quarter of 2025 . Before we begin , I kindly ask you to take a moment to read the Safe Harbor statement on slide number two of our presentation In today's presentation , we will review our fourth quarter 2025 company highlights financial performance , capital allocation initiatives , cash evolution during the quarter , operational performance , our continued investments in the fleet , developments on the regulatory front and our perspective on industry fundamentals .

Speaker #2: We will then open the floor for questions Turning to slide three . The fourth quarter was characterized by solid profitability , disciplined capital allocation and continued balance sheet strength For the fourth quarter of 2025 , our net income amounted to 65.2 million , while adjusted net income reached 74.5 million , or $0.16 .

Simos Spyrou: For Q4 2025, our net income amounted to $65.2 million, while adjusted net income reached $74.5 million or $0.16 adjusted EPS. Adjusted EBITDA was at $126.4 million, demonstrating the strong cash-generating capacity of our platform, even in a moderate rate environment. We continued to actively return capital to our shareholders. During Q4, we repurchased 1.2 million shares for a total of $22.7 million. Year to date, during Q1 2026, we have repurchased approximately 1.9 million shares, totaling $37.9 million. In addition, our board of directors declared a $0.37 per share dividend for Q4, payable on 19 March, to all shareholders of record as of 9 March 2026. Our balance sheet remains a key strategic advantage.

Speaker #2: Adjusted EPS, adjusted EBITDA was at $126.4 million, demonstrating the strong cash-generating capacity of our platform even in the moderate rate environment.

Speaker #2: We continued to actively return capital to our shareholders during the fourth quarter. We repurchased 1.2 million shares for a total of 22.7 million year to date.

Speaker #2: During the first quarter of 2026 , we have repurchased approximately 1.9 million shares totaling $37.9 million . In addition , our board of directors declared a $0.37 per share dividend for the fourth quarter , payable on March 19th , to all shareholders of record as of March 9th , 2026 .

Speaker #2: Our balance sheet remains a key strategic advantage Total cash and cash equivalents are approximately at 459 million . Outstanding debt is approximately at 1 billion , and we have an undrawn revolving capacity of 110 million .

Simos Spyrou: Total cash and cash equivalents are approximately at $459 million. Outstanding debt is approximately at $1 billion. We have an undrawn revolving capacity of $110 million. Importantly, we also have 27 debt-free vessels with an aggregate market value of approximately $630 million. This unencumbered asset base provides substantial financial flexibility to fund growth opportunities as well as, and downside protection. To further enhance shareholder value, we have taken the following capital allocation actions. Dividend policy. Going forward, we intend to distribute 100% of our free cash flow, subject to maintaining a minimum cash balance of $2.1 million per vessel, while preserving a minimum quarterly dividend of $0.05 per share. We have also authorized a new 100 million dollar share repurchase program on substantially the same terms as the prior program.

Speaker #2: Importantly , we also have 27 debt free vessels with an aggregate market value of approximately 630 million . This unencumbered asset base provides substantial financial flexibility to fund growth opportunities , as well as and downside protection To further enhance shareholder value .

Speaker #2: We have taken the following capital allocation actions . Dividend policy . Going forward , we intend to distribute 100% of our free cash flow , subject to maintaining a minimum cash balance of 2.1 million per vessel while preserving a minimum quarterly dividend of $0.05 per share .

Speaker #2: We have also authorized a new $100 million share repurchase program on substantially the same terms as the prior program This dual track approach dividends plus opportunistic buybacks funded from vessel sales , allows us to dynamically allocate capital depending on the market conditions and the discount or premium of our shares relative to the intrinsic value These initiatives reflect both our confidence in the company's forward cash flow , visibility and our commitment to maintaining a competitive and substantial and sustainable capital return profile On the top right side of slide number three , you can see our per vessel daily performance metrics for the quarter time charter equivalent came at $19,012 per day per vessel .

Simos Spyrou: This dual-track approach, dividends plus opportunistic buybacks funded from vessel sales, allows us to dynamically allocate capital depending on the market conditions and the discount or premium of our shares relative to the intrinsic value. These initiatives reflect both our confidence in the company's forward cash flow visibility and our commitment to maintaining a competitive and sustainable capital return profile. On the top-right side of slide number three, you can see our per-vessel daily performance metrics for the Q4. Time charter equivalent came at $19,012 per day per vessel. Combined daily operating expenses and net cash G&A expenses at $6,444 per day per vessel. This results in a daily cash margin of approximately $12,570 per vessel per day, before debt service and CapEx.

Speaker #2: Combined daily operating expenses and net cash G&A expenses at $6,444 per day per vessel . This result , this results in a daily cash margin of approximately $12,570 per vessel per day before debt service and CapEx These numbers highlight the operating efficiency of our platform and our ability to generate meaningful cash flow , even at mid-cycle rate levels Slide number four summarizes our capital allocation track record over the last five years , since 2021 , we have executed approximately $3 billion in value enhancing actions , including dividends , shares , repurchases , and debt repayment During this period , we have returned $13.49 per share in dividends , representing approximately 55% of our current share price We have reduced our total net debt by 47% , bringing leverage to a level where it is below 65% of the current demolition value of the fleet At the same time , we expanded the fleet opportunistically through accretive fleet acquisitions , issuing equity at or above Nav , thereby increasing scale while protecting per share value The result is a larger , more efficient platform with materially lower financial risk and significantly enhanced free cash flow per share potential Slide number five illustrates the movement in our cash balance during the fourth quarter .

Simos Spyrou: These numbers highlight the operating efficiency of our platform and our ability to generate meaningful cash flow, even at mid-cycle rate levels. Slide number four summarizes our capital allocation track record over the last five years. Since 2021, we have executed approximately $3 billion in value-enhancing actions, including dividends, shares repurchases, and debt repayment. During this period, we have returned $13.49 per share in dividends, representing approximately 55% of our current share price. We have reduced our total net debt by 47%, bringing leverage to a level where it's below 65% of the current demolition value of the fleet. At the same time, we expanded the fleet opportunistically through accretive fleet acquisitions, issuing equity at or above NAV, thereby increasing scale while protecting per share value.

Simos Spyrou: The result is a larger, more efficient platform with materially lower financial risk and significantly enhanced free cash flow per share potential. Slide number five illustrates the movement in our cash balance during Q4. We began Q4 with $457 million in cash. We generated $101 million in operating cash flow, after sale proceeds, debt drawdowns and repayments, CapEx payments related to new buildings installments, and energy-saving devices and ballast water treatment systems, the share buybacks, and the Q4 dividend payment, we ended Q4 with $502 million in cash. This sequential increase in cash underscores the strong internal cash generation of the company, even after substantial shareholder returns and investment in fleet upgrades. Slide number six highlights the inherent operating leverage embedded in our business model.

Speaker #2: We began the quarter with 457 million in cash We generated 101 million in operating cash flow . And after sale proceeds , debt drawdowns and repayments , CapEx payments related to new buildings , installments and energy saving devices and ballast water treatment systems .

Speaker #2: The share buybacks and the fourth quarter dividend payment . We ended the quarter with 502 million in cash . This sequential increase in cash underscores the strong internal cash generation of the company , even after substantial shareholder returns and investments in fleet upgrades Slide number six highlights the inherent operating leverage embedded in our business model with approximately 49.5 thousand fleet available days per annum , and based on the current next 12 month FFA curve of approximately 18.5 thousand per day .

Simos Spyrou: With approximately 49,500 fleet available days per annum, based on the current next twelve-month FFA curve of approximately $18,500 per day on a fleet-wide basis, the company would generate approximately $2.7 per share of free cash flow. representing at almost 11% implied cash flow yield. The slide illustrates the strength of our platform on a rising market. Every $1,500 per day fleet-wide increase in our TCE equates to an EBITDA increase of $73 million. This would translate to $0.65 per share of incremental dividend to our shareholders, given our existing approach to distributions. In summary, during Q4, we delivered solid profitability, strengthened our liquidity position, continued to delever, returned meaningful capital to shareholders, and preserved significant optionality for future capital allocation.

Speaker #2: On a fleet wide basis , the company . The company would generate approximately $2.7 per share of free cash flow , representing a almost 11% implied cash flow yield .

Speaker #2: The slide illustrates the strength of our platform on a rising market Every $1,500 per day , fleet wide increase in our TCE equates to an EBITDA increase of $73 million .

Speaker #2: This would translate to $0.65 per share of incremental dividend to our shareholders . Given our existing approach to distributions . In summary , during the fourth quarter , we delivered solid profitability , strengthened our liquidity position , continued to deliver , returned meaningful capital to shareholders , and preserved significant optionality for future capital allocation Our balance sheet resilience operating efficiency and disciplined capital allocation framework position us well to navigate market volatility while continuing to enhance per share value With that , I will now pass the floor to our CEO Nicos Rescos for an update on our operational performance and the continued investments we are making in our fleet Thank you .

Simos Spyrou: Our balance sheet resilience, operating efficiency, and disciplined capital allocation framework position us well to navigate market volatility while continuing to enhance per share value. With that, I will now pass the floor to our COO, Nicos Rescos, for an update on our operational performance and the continued investments we are making in our fleet.

Nicos Rescos: Thank you, Simo. Please turn to Slide 7, covering our operational performance. We continue to run one of the most cost-efficient platforms in the dry bulk sector. Daily operating expenses for Q4 came in at $5,045 per vessel, and net cash G&A at $1,399 per vessel, both among the lowest in our peer group, as illustrated. Importantly, this operational cost discipline has not come at the expense of quality. Star Bulk continues to rank at the top amongst listed peers in RightShip safety scores. Moving to Slide 8, we outline our fleet-wide investment program. On the new building front, all 8 of our Kamsarmax new buildings are on track for delivery during 2026, with $206.6 million of CapEx remaining. Financing is well advanced.

Speaker #2: Simon Please turn to slide seven , covering our operational performance . We continue to run one of the most cost efficient platforms in the Drybulk sector .

Speaker #2: Daily operating expenses for Q4 came in at $5,045 per vessel , and net cash at $1,399 per vessel , both among the lowest in our peer group .

Speaker #2: As illustrated Importantly , this operational cost discipline has not come at the expense of quality Starboard continues to rank at the top amongst listed peers in right shift safety scores Moving to slide eight , we outline our fleet wide investment program on the new building front All eight of our customers buildings are on track for delivery during 2026 .

Speaker #2: With $206.6 million of CapEx remaining, financing is well advanced. We have secured $130 million of debt against the five King vessels and expect a further $74 million against the three King vessels on vessel upgrades.

Nicos Rescos: We have secured $130 million of debt against the five Qingdao vessels and expect a further $74 million against the three Cheng Xin vessels. On vessel upgrades, we made meaningful progress during 2025, fitting 13 additional vessels with energy-saving devices and 6 with high-efficiency propellers. In total, we have now completed 55 out of 80 ESD total installations across the fleet and with another 14 planned for 2026. We have also nearly completed our telemetry rollout, with 121 out of 126 eligible vessels now retrofitted with digital monitoring equipment. The top right of the page shows our CapEx schedule, illustrating both the new building payments and our vessel efficiency upgrade spending, alongside the corresponding debt financing.

Speaker #2: We made meaningful progress during 2025 , fitting 13 additional vessels with energy saving devices and six with high efficiency propellers In total , we have now completed 55 out of 88 total installations across the fleet , and with another 14 planned for 2026 , we have also nearly completed our telemetry rollout with 121 out of 126 eligible vessels .

Speaker #2: Now retrofitted with digital monitoring equipment . The top right of the page shows our CapEx schedule , illustrating both the new building payments and our vessel efficiency upgrade spending , alongside the corresponding debt financing at the bottom , you can see our expected drydocks schedule for 2026 , which totals approximately 55.6 million , with around 51,585 of hard days for the full year .

Nicos Rescos: At the bottom, you can see our expected drydock schedule for 2026, which totals approximately $55.6 million, with around 1,585 off-hire days for the full year. Turning to Slide 9 for our fleet update. We continue to optimize our fleet through selective disposals, prioritizing the sale of older, non-eco tonnages to reduce our average fleet age and improve overall efficiency. During Q4, we delivered three vessels to their new owners, two Supramax and a Panamax, Star Runner, Star Sandpiper, and Star Emily. In December, we agreed to sell Star Stonington, an Ultramax, which was delivered to our new owners in February. Looking into Q1 2026, we have committed two additional older vessels for sale, an inefficient Capesize and a Kamsarmax, Star Scarlett and Star Mariella, with deliveries expected in April.

Speaker #2: Turning the slide nine for fleet update , we continue to optimize our fleet through selective disposals , prioritizing the save of older neonicotinoids to reduce our average fleet age and improve overall efficiency .

Speaker #2: During Q4 , we delivered three vessels to their new owners to supermarkets and a Panamax star runner . Star Sandpiper and star Emily .

Speaker #2: In December . We agreed to sell Star Stonington and Ultramax , which was delivered to her new owners in February Looking into Q1 2026 , we have committed two additional older vessels for sale and inefficient capesize and a star Skyline and star Mariella , with deliveries expected in April .

Speaker #2: We continue to maintain seven long term chartering contracts , which provide commercial flexibility across market cycles . Starbuck operates one of the largest drybulk fleets among US and European listed peers , with 141 vessels on a fully delivered basis and an average age of approximately 12.1 years .

Nicos Rescos: We continue to maintain seven long-term chartering contracts, which provide commercial flexibility across market cycles. Star Bulk operates one of the largest dry bulk fleets among US and European-listed peers, with 141 vessels on a fully delivered basis and an average age of approximately 12.1 years. I will now pass the floor to our Chief Strategy Officer, Charis Plakantonaki, for an update on recent global environmental regulation developments.

Speaker #2: I will now pass the floor to our Chief Strategy Officer , Charis Plakantonaki , for an update on recent global environmental regulation developments .

Speaker #3: Thank you . Niko Please turn to slide ten , where we highlight our progress across ESG priorities Despite the one year postponement of the IMO net zero framework in October 25th , we remain committed to our strategy to reduce greenhouse gas emissions from our fleets operations .

Charis Plakantonaki: Thank you, Niko. Please turn to Slide 10, where we highlight our progress across ESG priorities. Despite the 1-year postponement of the IMO Net-Zero Framework in October 2025, we remain committed to our strategy to reduce greenhouse gas emissions from our fleet's operations. Alongside the ongoing renewal of our fleet, in Q4 2025, we continued to enhance the energy efficiency of our vessels through targeted technical and operational measures, including the successful testing of hull cleaning robots and silicone antifouling coatings. In 2025, the Star Bulk fleet achieved an average C rating in the RightShip's greenhouse gas rating. We also maintained our B score for effective environmental management in the 2025 Carbon Disclosure Project and Water Management Submission.

Speaker #3: Alongside the ongoing renewal of our fleet in Q4 25 , we continued to enhance the energy efficiency of our vessels through targeted technical and operational measures , including the successful testing of hull cleaning robots and silicone anti-fouling coatings .

Speaker #3: In 2025 . The Starbuck fleet achieved an average sea rating in the right ship greenhouse gas rating . We also maintained our best score or effective environmental management in the 2025 Carbon Disclosure Project , and Water Management Submission We continue to contribute actively to the work of the Maritime Emission Reduction Center , working with our partners to assess emerging technologies aimed at improving vessel performance , to comply with EU maritime and consistent with last year , we entered into a pooling agreement with an external party to cover 100% of our CO2 deficit for 26 and part of 27 .

Charis Plakantonaki: We continue to contribute actively to the work of the Maritime Emissions Reduction Centre, working with our partners to assess emerging technologies aimed at improving vessel performance. To comply with FuelEU Maritime and consistent with last year, we entered into a pooling agreement with an external party to cover 100% of our CO2 deficit for 2026 and part of 2027, purchasing surplus units, the most cost-effective compliance strategy. On the technology front, we completed the deployment of Starlink and installed onboard firewalls across the fleet to enhance connectivity and strengthen cybersecurity. As part of our artificial intelligence strategy, we delivered the company's first custom-built AI application, while continuing to leverage AI within existing systems and to develop new tools to further automation and optimization. The well-being of our people remains a priority.

Speaker #3: Purchasing surplus units , the most cost effective compliance strategy on the technology front , we completed the deployment of Starlink and installed onboard firewalls across the fleet to enhance connectivity and strengthen cybersecurity As part of our artificial intelligence strategy , we delivered the company's first custom build AI application while continuing to leverage AI within existing systems and to develop new tools to further automation and optimization .

Speaker #3: The well-being of our people remains a priority . During Q4 25 , we contacted a comprehensive , company wide employee survey to listen closely to our teams and identify tangible actions to better support them in their roles I will now pass the floor to our Head of Market Analysis , Constantinos Simantiras .

Charis Plakantonaki: During Q4 2025, we conducted a comprehensive company-wide employee survey to listen closely to our teams and identify tangible actions to better support them in their roles. I will now pass the floor to our Head of Market Analysis, Constantinos Simantiras, for a market update and his closing remarks.

Speaker #3: For a market update and his closing remarks. Thank you. Harris, please turn to slide 11 for a brief update of supply.

Constantinos Simantiras: Thank you, Charis. Please turn to slide 11 for a brief update of supply. During 2025, 36.2 million deadweight was delivered, and 5.2 million deadweight was sent to demolition, resulting in net fleet growth of 31 million deadweight, or 3% year-over-year. The new building order book has grown over the past 3 years, but remains at relatively low 12.8% of the fleet. Contracting remains under control, decreasing to 45.8 million deadweight during 2025, reflecting limited CPR capacity through 2028, ship high ship building costs, and ongoing uncertainty around green propulsion technologies. The IMO's recent decision to postpone adoption of the Net-Zero Framework will likely extend this uncertainty into 2026. That said, we've seen a noticeable uptick in contracting in the Capesize segment over the last few months.

Speaker #3: During 2025 , 36.2 million deadweight was delivered and 5.2 million deadweight was sent to demolition , resulting in net fleet growth of 31 million deadweight , or 3% year over year The new Building order book has grown over the past three years , but remains at relatively low .

Speaker #3: 12.8% of the fleet contracting remained under control , decreasing to 48.8 45.8 million deadweight during 2025 , reflecting limited capacity through 2028 . High shipbuilding costs and ongoing uncertainty around green propulsion technologies The IMO's recent decision to postpone adoption of the Net zero framework will likely extend this uncertainty into 2026 .

Speaker #3: That said , we've seen a noticeable uptick in contracting in the Capesize segment over the last few months Meanwhile , the fleet continues to age , and by the end of 2027 , approximately 50% of the existing fleet will be over 15 years old Moreover , the rising number of vessels undergoing their third special survey and drydocks is estimated to reduce effective capacity by approximately 5% per annum during 2026 and 2027 .

Constantinos Simantiras: Meanwhile, the fleet continues to age, and by the end of 2027, approximately 50% of the existing fleet will be over 15 years old. Moreover, the rising number of vessels undergoing their third special survey and dry docks is estimated to reduce effective capacity by approximately 0.5% per annum during 2026 and 2027. On the operational side, average fleet steaming speeds have recovered from last year's historical lows and stabilized at around 11.1 knots over the past 2 quarters, incentivized by firmer freight rates and lower bunker costs. Over the coming years, stricter environmental regulations are expected to continue to support slow steaming and help constrain effective supply. Finally, global port congestion dropped to 6-year low during Q4 2025, but has since returned to long-term average levels.

Speaker #3: On the operational side , average fleet steaming speeds have recovered from last year's historical lows and stabilized at around 11.1 knots over the past two quarters , incentivized by firmer freight rates and lower bunker costs .

Speaker #3: Over the coming years , stricter environmental regulations are expected to continue to support slow steaming and help constrained effective supply Finally , global port congestion dropped to six year lows during the fourth quarter of 2025 , but has since returned to long term average levels .

Speaker #3: For 2026 . We anticipate congestion to follow typical seasonal patterns and to remain broadly neutral for the supply and demand balance , though there could be some upside from delays at new mining hubs in West Africa , where loading operations remain particularly time intensive Let us now turn to slide 12 .

Constantinos Simantiras: For 2026, we anticipate congestion to follow typical seasonal patterns and to remain broadly neutral for the supply and demand balance, though there could be some upside from delays at new mining hubs in West Africa, where loading operations remain particularly time-intensive. Let us now turn to Slide 12 for a brief update of demand. According to Clarksons, total dry bulk trade grew 1.3% in volume and 2.1% in ton-miles during 2025. This was driven by record bauxite and minor bulk exports, plus a solid recovery in iron ore, coal, and grain volumes in the second half. Strong Atlantic exports, longer Pacific distances, and ongoing war-related inefficiencies supported ton-mile growth throughout the year.

Speaker #3: For a brief update of demand, according to Clarksons, total dry bulk trade grew 1.3% in volume and 2.1% in ton-miles during 2025.

Speaker #3: This was driven by record bauxite and minor bulk exports , plus a solid recovery in iron ore , coal and grain volumes . In the second half .

Speaker #3: Strong Atlantic exports . Longer Pacific distances and ongoing war related inefficiencies . Supported ton mile growth throughout the year Red Sea crossings improved somewhat during the fourth quarter after the October ceasefire , but .

Constantinos Simantiras: Red Sea crossings improved somewhat during the Q4 after the October ceasefire, but they're still roughly 40% below pre-Houthi levels. Geopolitical risks in the region remain high. China's total dry bulk imports were essentially flat during 2025, as the 4.2 decline in during the first half was fully offset by a 4.1% rebound during the second half, with iron ore and coal imports reaching new all-time highs during December. Meanwhile, imports to the rest of the world continued to recover in 2025, with notable strength in the second half amid reduced uncertainty in international trade relationships. Non-China import volumes grew 3.2% throughout the year, supported by lower commodity prices, a weaker US dollar enhancing affordability, and resilient demand in key regions.

Speaker #3: But they're still roughly 40% below Pro-houthi levels and geopolitical risks in the region remain high China's total dry bulk imports were essentially flat during 2025 , as the 4.2 decline during the first half was fully offset by a 4.1% rebound during the second half , with iron ore and coal imports reaching new all time highs during December Meanwhile , imports to the rest of the world continue to recover .

Speaker #3: In 2025 , with not notable strength in the second half . Amid reduced uncertainty in international trade relationships Non-china import volumes grew 3.2% throughout the year , supported by lower commodity prices , a weaker US dollar and enhancing affordability and resilient demand in key regions Growth was mainly driven by Southeast Asia , India and the Middle East , with additional support from Africa and Intra-asian trade Looking ahead , Drybulk demand is projected to grow by 0.6% in tons and 1.9% in total miles during 2026 .

Constantinos Simantiras: Growth was mainly driven by Southeast Asia, India, and the Middle East, with additional support from Africa and intra-Asian trade. Looking ahead, dry bulk demand is projected to grow by 0.6% in tons and 1.9% in ton-miles during 2026. The IMF recently raised its 2026 global GDP forecast by 0.2% to 3.3%, with upward revisions of 0.3% for both the US and China. The trade route between the US and between the US and China, new agreement with major partners, and the recent decision by the US Supreme Court on presidential authority to impose reciprocal tariffs should reduce uncertainty, support economic activity, and demand for raw materials. That said, elevated Chinese stockpiles across a range of commodities, slower industrial production, and softer fixed asset investment presents downside risks...

Speaker #3: The IMF recently raised its 2026 global GDP forecast by 0.2% to 3.3% , with upward revisions of 0.3% for both the US and China .

Speaker #3: The trade , the trade truce between the US and between the US and China . New agreement with major partners and the recent decision by the US Supreme Court on presidential authority to impose reciprocal tariffs should reduce uncertainty , support economic activity and demand for raw materials That said , elevated Chinese stockpiles across a range of commodities .

Speaker #3: Slower industrial production and softer fixed asset investment present downside risks , though these should be partly offset by new mine capacity ramping up , breaking down by key commodities .

Constantinos Simantiras: Though these should be partly offset by new mine capacity ramping up. Breaking down by key commodities, iron ore trade grew 2.2% during 2025, and is projected to rise 1.9% in 2026. For the first time since 2020, China crude steel production fell below 1 billion tons, down 4.5% overall in 2025, and 11% in Q4, as a result of policy curbs on steel supply and the ongoing real estate slowdown. Record-high Chinese steel exports helped offset weak domestic consumption, while steel output in the rest of the world increased by 1.2%. Domestic iron ore output declined by 2.5% in 2025, while stockpiles on Chinese ports currently stand at close to all-time highs after the Q4 import surge.

Speaker #3: Iron ore trade grew 2.2% during 2025 and is projected to rise 1.9% in 2026 . For the first time since 2020 , China crude steel production fell below 1 billion tonnes , down 4.5% overall in 2025 and 11% in Q4 As a result of policy curbs on steel supply and the ongoing real estate slowdown Record high Chinese steel exports helped offset weak domestic consumption while steel output in the rest of the world increased by 1.2% .

Speaker #3: Domestic iron ore output declined by 2.5% in 2025 , while stockpiles and Chinese ports currently stand at close to all time highs . After the Q4 import surge Looking ahead , Chinese iron ore imports are expected to remain broadly flat in 2026 , while stronger Brazil volumes and the gradual ramp up of high quality exports from West Africa should support ton mile growth over the coming years .

Constantinos Simantiras: Looking ahead, Chinese iron ore imports are expected to remain broadly flat in 2026, while stronger Brazil volumes and the gradual ramp-up of high-quality exports from West Africa should support ton-mile growth over the coming years. Coal trade contracted 5.6% during 2025, is projected to decline another 2.5% in 2026. Volumes experienced a strong recovery in the second half, stayed below 2024 levels. Stronger renewable expansion in China should continue to pressure demand. Domestic production in China and India is outpacing consumption growth and stockpiles remain high. Indonesian coal exports are expected to decline further in 2026, following announced production cuts of up to 25%, which could tighten volume, potentially support ton-miles through longer haul flows.

Speaker #3: Coal trade contracted 5.6% during 2025 and is projected to decline another 2.5% in 2026 . Volume experienced a strong recovery in the second half , but stayed below 2024 levels .

Speaker #3: Strongly renewable expansion in China should continue to pressure demand . Domestic production in China and India is outpacing consumption growth and stockpiles remain high Indonesian coal exports are expected to decline further in 2026 following a production cuts of up to 25% , which could tighten volumes .

Speaker #3: But potentially support ton miles through longer haul flows Furthermore , India's new thermal energy capacity growing demand for from Southeast Asia and global focus on energy security should provide support for coal trade over the next years Grain trade grew 2.9% in 2025 and is projected to surge 7.8% in 2026 .

Constantinos Simantiras: Furthermore, India's new thermal energy capacity, growing demand from Southeast Asia, and global focus on energy security should provide support for coal trade over the next years. Grain trade grew 2.9% in 2025, and is projected to surge 7.8% in 2026. Second half 2025 volumes jumped 10%, led by robust exports from Brazil, Argentina, and Australia, plus better than expected US shipments. Black Sea exports remain subdued, but should gradually recover over the next two years. More important, China resumption of US soybean purchases under the trade truce will carry into 2026, boosting ton-miles for mid-sized bulkers. China has committed 20 million tons by the end of the current season and around 25 million tons annually through 2028.

Speaker #3: Second half 2025 volumes jumped 10% , led by robust exports from Brazil , Argentina and Australia , plus better than expected US shipments Black sea exports remained remained subdued , but should gradually recover over the next two years .

Speaker #3: More important , China resumption of US soya bean purchases under the the trade truce will carry into 2026 boosting ton miles for mid-sized buffers China has committed 20 million tons by the end of the current season , and around 25 million tons annually through 2028 .

Speaker #3: Minor bulk trade grew 5.2% in 2025 , and is projected to expand by 2.1% in 2026 . Minor bulks carry the highest correlation with global GDP and continued to benefit from healthy macro outlooks across major economies That said , growth should moderate somewhat next year due to rising protectionism and a slowdown in growth of West African bauxite volumes after last year's 33% surge .

Constantinos Simantiras: Minor bulk trade grew 5.2% in 2025, and is projected to expand by 2.1% in 2026. Minor bulks carry the highest correlation with global GDP and continue to benefit from healthy macro outlooks across major economies. That said, growth should moderate somewhat next year due to rising protectionism and a slowdown in growth of West African bauxite volumes after last year's 33% surge. As a final comment, we remain optimistic about the dry bulk market outlook, underpinned by a favorable supply backdrop, tightening environmental regulations, and easing trade tensions. In a period of heightened geopolitical uncertainty, we remain focused on actively managing our diverse, scrubber-fitted fleet to capitalize on market opportunities and deliver value to our shareholders.

Speaker #3: As a final comment , we remain optimistic about the dry market outlook , underpinned by a favorable supply backdrop tightening environmental regulations and easing trade tensions in a period of heightened geopolitical uncertainty will remain focused on actively managing our diverse scrubber fitted fleet to capitalize on market opportunities and deliver value to our shareholders without taking any more of your time .

Constantinos Simantiras: Without taking any more of your time, I will now pass the floor over to the operator to answer any questions you may have.

Speaker #3: I will now pass the floor over to the operator to answer any questions you may have

Speaker #1: Thank you We will now be conducting a question and answer session . If you would like to ask a question , please press star one on your telephone keypad A confirmation tone will indicate your line is in the question queue .

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question will come from Chris Robertson with Deutsche Bank.

Speaker #1: You may press star two if you would like to remove your question from the queue for participants using speaker equipment , it may be necessary to pick up your handset before pressing the star keys And our first question will come from Chris Robertson with Deutsche Bank

Speaker #4: Thank you . Operator . And good morning , team . My question is just related to the underlying demand . And ten mile expansion that's happening in the iron ore market .

Chris Robertson: Thank you, operator. Good morning, team. My question is just related to the underlying demand and ton-mile expansion that's happening in the iron ore market, with Brazil and West Africa. Are there any other dry bulk commodities that have a similar dynamic where, you know, let's say, underlying demand for the commodity remains flattish or maybe even slightly weaker, but ton-mile demand is held stable or expands because of the geo, the geographical dispersion of where the commodities are coming from? Any commentary around that would be helpful.

Speaker #4: With Brazil and West Africa . Are there any other . Dry commodities that have a similar dynamic where , you know , let's say underlying demand for the commodity remains flattish ?

Speaker #4: Or maybe even slightly weaker , but ton mile demand has held stable or expands because of the Geo . The geographical dispersion of where the commodities are coming from .

Speaker #4: Any commentary around that would be helpful .

Speaker #3: Hi , Chris . So besides , besides bauxite and iron ore , we see a very strong trade on on grains which are going to be increasing by about seven and a half to 8% .

Constantinos Simantiras: Hi, Chris. Besides bauxite and iron ore, we see a very strong trade on grains, which are going to be increasing by about 7.5 to 8%. As most of them are coming from Brazil, we will get some extra ton-miles from there. We also see demand from West Africa on smaller vessels, and that is going to create congestion as well, because of construction projects that they got. I think this is going to be a positive as well. Now,

Speaker #3: And as most of them are coming from Brazil , we will get some extra miles from from there We also see demand from West Africa on smaller vessels and that is going to create congestion as well .

Speaker #3: Because of construction projects that they got . And I think this is going to be a positive as well Now minor bulk are cold coal .

Christos Begleris: minor bulk. Coal. If Indonesia actually goes ahead with cutting down 25% of their exports, this might also increase ton-miles as imports may have to come from further away. We think that overall, there is other possibilities as well. The bauxite and the iron ore trade are actually going to be big pluses.

Speaker #3: If if Indonesia actually goes ahead with cutting down 25% of their exports , this might also increase ton miles as imports may have to come from further away So we think that overall there is other possibilities as well .

Speaker #3: But the bauxite and the iron ore , iron ore trade are actually going to be big pluses .

Speaker #4: Yeah , that makes sense . Thanks for the color there . Just kind of following up on the potential for greater congestion in West Africa .

Chris Robertson: Yeah, makes sense. Thanks for the color there. Just kind of following up on the potential for greater congestion in West Africa. Are any of the projects or whether it's rail or trucking or the ports themselves, et cetera, are there any projects right now to build out that infrastructure a bit more to make the supply chain more efficient? Kind of what's going on there that may lead to, you know, congestion maybe going up in the short term, but being alleviated in the long run as potentially infrastructure is more built out?

Speaker #4: Are they are any of the projects or whether it's rail or trucking or the ports themselves , etc. ? Are there any projects right now to to build out that infrastructure a bit more to make the supply chain more efficient ?

Speaker #4: Kind of what's going on there that may lead to , you congestion , maybe going up in the short term , but being alleviated in the long run as potentially infrastructure is more built out .

Speaker #3: Well , I don't know details about that . What I know is that calls Supramax Ultramax calls in West Africa . Have increased by about 30% during the past year .

Christos Begleris: Well, I don't know details about that. What I know is that, coals, Supramax, Ultramax coals in West Africa have increased by about 30% during the past year. Now, if our analyst knows anything about the projects, he can.

Speaker #3: Now, if our analyst knows anything about the projects, he can.

Speaker #2: I would add that it's exactly what you said . Chris . We expect that we will have , in the short term , an increase in congestion and over the next few years , as the infrastructure is upgraded , this will gradually go down .

Constantinos Simantiras: I would add that it's exactly what you said, Chris. We expect that we will have, in the short term, an increase in congestion, and over the next few years, as the infrastructure is upgraded, this will gradually go down. This is not something that would take place in one, two years.

Speaker #2: But this is not something that will take place in one or two years.

Speaker #4: Got it . Yeah , that's super helpful . Thank you very much . I'll turn it over .

Chris Robertson: Got it. Yeah, that's super helpful. Thank you very much. I'll turn it over.

Speaker #3: Thank you . Chris

Christos Begleris: Thank you, Chris.

Speaker #1: And as a reminder , that is star one . If you would like to ask a question , we'll go next to Omar Nokta with Clarkson Securities

Operator: As a reminder, that is star one, if you would like to ask a question. We'll go next to Omar Nokta with Clarksons Securities.

Speaker #5: Thank you . Hi , guys . Good afternoon . I just wanted to ask maybe just about the capital return policy . Just a bit more detail on that .

Operator 2: Thank you. Hey, guys. Good afternoon. I just wanted to ask maybe just about the capital return policy, just a bit more detail on that. You know, clearly, the move back to a 100% payout or maybe somewhat similar to how it was prior to the focus on the buybacks last year. The decision, I guess, to boost the dividend payout, did that come about simply just given the strong share performance we've seen here recently, or is there more to it?

Omar Nokta: Thank you. Hey, guys. Good afternoon. I just wanted to ask maybe just about the capital return policy, just a bit more detail on that. You know, clearly, the move back to a 100% payout or maybe somewhat similar to how it was prior to the focus on the buybacks last year. The decision, I guess, to boost the dividend payout, did that come about simply just given the strong share performance we've seen here recently, or is there more to it?

Speaker #5: Clearly , the move back to 100% payout . Or maybe somewhat similar to how it was prior to the focus on the buybacks last year .

Speaker #5: The decision , I guess , to boost the dividend payout , did that come about simply just given the strong share performance we've seen here recently , or is there more to it

Speaker #6: Hi , Omar , it's Hamish Norton , you know , the the the basically the better the share does the stronger the incentive to pay a dividend as opposed to a share repurchase .

Hamish Norton: Hi, Omar. It's Hamish Norton. You know, basically, the better the share does, the stronger the incentive to pay a dividend as opposed to a share repurchase. You know, there's nothing really more to it than that.

Speaker #6: And you know , so there's nothing really more to it than that

Speaker #5: Okay . Thank you . And then just a follow up then to that is as we think about free cash flow is earnings a good representation of that to approximate what free cash flow looks like .

Operator 2: Okay. Thank you. Just a follow-up into that is, as we think about free cash flow, is earnings a good representation of that to approximate what free cash flow looks like? I know quarter-over-quarter, there's gonna be changes. Is earnings a good way to look at it? Do you think it understates free cash flow, or any color you're able to give on that front?

Omar Nokta: Okay. Thank you. Just a follow-up into that is, as we think about free cash flow, is earnings a good representation of that to approximate what free cash flow looks like? I know quarter-over-quarter, there's gonna be changes. Is earnings a good way to look at it? Do you think it understates free cash flow, or any color you're able to give on that front?

Speaker #5: I know quarter to quarter . There's going to be changes . But is earnings a good way to look at it . Do you think it understates free cash flow or any color you're able to give on that front .

Speaker #6: It's not terrible . But you know you have to look at the difference between depreciation and debt repayment and .

Hamish Norton: It's not terrible, but, you know, you have to look at the difference between depreciation and debt repayment.

Speaker #2: Change in working capital .

Christos Begleris: Change in working capital as well.

Speaker #6: As well .

Speaker #2: So if I may add . Hi , Omer , this is Christos . A few things . First of all , debt principal repayment is slightly higher than depreciation .

Hamish Norton: Yeah.

Christos Begleris: If I may add. Hi, Omar, this is Christos. A few things. First of all, debt principal repayment is slightly higher than depreciation. Therefore, the free cash flow is lower than net income. Also, as Simos said, it's the change in net working capital. In a market that rises fast, you would expect the working capital change to be greater, thereby reducing the free cash flow. Whereas in a market that is reducing, the change in working capital will be positive and therefore, that is boosting the free cash flow available for dividends.

Speaker #2: And therefore the free cash flow is lower than net income . And also , as Simo said , it's the change in net working capital So in in the market that rises fast , you would expect the working capital change to be greater , thereby reducing the free cash flow .

Speaker #2: Whereas in a market that is reducing the change in working capital would be positive and therefore that is boosting the free cash flow available for dividends ?

Speaker #5: Okay , thanks , Christos . And thanks , Hamish . That's it for me . Thank you .

Operator 2: Okay. Thanks, Christos. And thanks, Hamish. That's it for me. Thank you.

Omar Nokta: Okay. Thanks, Christos. And thanks, Hamish. That's it for me. Thank you.

Speaker #3: Thank you Omar

Christos Begleris: Thank you, Omar.

Speaker #1: And this now concludes our question and answer session . I would like to turn the floor back over to management for closing comments

Operator 2: Okay.

Omar Nokta: Okay.

Operator: This now concludes our question and answer session. I would like to turn the floor back over to management for closing comments.

Speaker #3: No closing Operator . Thank you very much

Christos Begleris: No closing comments, operator. Thank you very much.

Speaker #1: Thank you , ladies and gentlemen . Thank you for your participation . This does conclude today's teleconference . You may disconnect your lines and have a wonderful day

Operator: Thank you. Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines and have a wonderful day.

Q4 2025 Star Bulk Carriers Corp Earnings Call

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