HELLENIC CARRIERS LIMITED 
By
Hellenic Carriers Limited, ("Hellenic" or the "Company") (AIM: HCL), an international provider of marine transportation services, which owns through its subsidiaries a fleet of dry bulk vessels that transport iron ore, grain, steel products and minor bulk cargoes, announces today the delivery of the 2004 built M/V OCEAN ALLIANCE which was renamed PISTIS (the word "PISTIS" means faith in English).
M/V PISTIS, which was delivered on 7 January 2014, is a geared 52,388 dwt Supramax vessel built at Tsuneishi Shipbuilding Corporation, Japan in 2004 and was acquired on 23 August 2013 at the price of US$ 16.16 million.
The acquisition was funded partly by cash reserves of US $8.3 million and partly by one of Hellenic's existing bank facilities. The bank facilities included the proceeds from the sale of M/V HELLENIC SEA amounting to US$ 5.3 million, which were transferred as bank financing towards the acquisition price of the new vessel, coupled with new debt of US$2.5 million.
Fotini Karamanli, Chief Executive Officer commented:
"We are pleased to announce the delivery of M/V PISTIS, a 2004 built Supramax acquired in late August
2013 at a price of US$16.16 million. Since August 2013 both the freight market and asset values have appreciated, hence we consider that the decision to invest enhances shareholder value..
M/V PISTIS is the latest addition to the fleet, following the deliveries of the new Kamsarmaxes in August and September 2013. Within a year the fleet has more than doubled in dwt capacity and improved in terms of age profile. Most importantly, these recent additions were concluded at levels which are well below the 10 year average prices for similar assets and have come at a time when the signs of recovery are apparent. This makes us believe that these ships have the potential for significant profit generation capacity. Even more so, since the fleet has no previous long term employment commitments and may fully capitalize on the eventual market recovery as freight rates have been improving since Q4 2013.
After almost two years of consistently depressed rates, close to the historical lows, we believe that the fundamentals are now positive: the massive order book inherited from the years of the shipping super cycle has now to a great degree been absorbed, many older vessels have been scrapped, forward orders are increasing but not threatening and demand not only from the developing countries but also from mature economies is strengthening. We consider that these factors combined herald the recovery of the shipping market, which started earlier than most anticipated in H2 2013. Although seasonal volatility will persist, interrupting at times the upward trajectory, the trend is positive.
Hellenic is well positioned to benefit from this trend, with a larger, younger and uncommitted fleet. The timing of the recent additions was favorable and, since we believe that the prospects remain strong, the Company will endeavor to further enhance shareholder value through timely and accretive acquisitions as market opportunities arise".
Following the delivery of M/V PISTIS, Hellenic, through its subsidiaries, owns and trades a fleet of six dry bulk vessels with an aggregate carrying capacity of 384,864 dwt and an average age of 9.9 years.
Fleet details as of the date of the announcement:
Hellenic acquired three vessels from the end of 2012 to date, doubling the number of vessels currently trading in worldwide maritime routes and increasing the fleet carrying capacity by 127% to 384,864dwt from 169,116dwt on 31 December 2012. At the same time the average age has reduced by 36.1% to 9.9 years from 15.5 years on 31 December 2012.
Fleet Deployment
From the beginning of 2012 until the end of H1 2013 the dry bulk freight market dropped to its lowest levels of the last 27 years, since inception of the Baltic Dry Index (BDI). During this period the Company decided to avoid committing the vessels at low hire rates and focused on a combination of employment in the spot market and short term period fixtures.
In H2 2013 and especially during Q4 2013 the first signs of a market recovery became apparent. The BDI increased by 86% from an average of 842 points in H1 to 1,564 points in H2 2013. The sharpest rise was witnessed in the cape size sector, however the sub cape size segments also benefited from the improvement in the freight market.
The two Kamsarmaxes, ordered in 2010, were delivered in August and September 2013, thus increasing the fleet to 5 vessels. Furthermore, the agreement for the acquisition of M/V OCEAN ALLIANCE, as described above, was reached in H2 2013.
The chartering strategy during Q4 2013 remained the same, employment in the spot market or short period fixtures.
The fleet deployment profile as of the date of the announcement is outlined below:
Vessel | Type | Charter Type | T/C Earliest Expiration Date(1) | Daily Charter Rate US$ (Gross) | ||||||||||||||||||||||||||||
M/V Pistis (2) | Supramax | Share
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