Sailing Toward the Lighthouse — Is This Company In the Shipping Industry Poised To Shine?

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The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Seanergy Maritime Holdings Corp. SHIP, listed on the Nasdaq Stock Market since 2008, provides dry bulk shipment services in the competitive and essential global dry shipment industry. The company received the Dry Cargo Company of the Year Award for 2021 from Lloyd’s List Greek Shipping Awards, an entity that recognizes the best in the competitive worldwide shipping industry.

Closing in on Sector Improvement

Lloyd’s List, one of the world's oldest continuously running journals, has provided weekly shipping news since 1734. Lloyd’s cites Moody analyst expectations of demand continuing to outstrip supply as the shipping sector continues to ride on extended supportive fundamentals. 

“Limited deliveries of fresh tonnage in 2022 may result in freight rates being kept at high levels,” the journal writes. “Shipowners are expected to use cash flow from their operations on expanded capital investments and acquisitions. They are also expected to take advantage of record-high earnings and cash flow generation to pare down debt levels.”

Seanergy In a Dynamic Industry on Which the Whole World Relies

The dry bulk shipping industry — which includes names like Star Bulk Carriers Corp. SBLK, Golden Ocean Group Ltd. GOGL and Genco Shipping & Trading Ltd. GNK in addition to Seanergy Maritime — plays a vital role in the intimate workings of nearly every aspect of human activity. Esben Poulsson, chairman of the International Chamber of Shipping, the London-based association whose membership comprises approximately 80% of the world fleet, said in an opinion piece posted in the South China Morning Post that the industry needs to “rapidly scale up R&D, have a global market-based measure to ensure a sustainable business model for our industry, and make sure that whatever we do is equitable and safe. Shipping is no longer the servant of global trade; it is a vital force in overcoming many global challenges. From building back better and driving economic growth, to the creation of a just and green transition – shipping will be vital.”

Christmas Came Early for Seanergy This Year

Seanergy reported that it achieved strong third-quarter 2021 results and provided a decent outlook for the fourth quarter, moving past the seasonally weak first quarter. On its recent conference call, management said it would introduce a dividend policy in the not-too-distant future. Most importantly, Seanergy engaged in and completed the previously announced share buybacks of a spectacular $16.6 million in total. 

These consist of a USD 13.9m buyback of convertible notes, buyback of warrants to purchase USD 4.3m shares and share-buyback of 1.6m of common shares. Repayment of the notes will prevent a potential dilution of ~11.63m shares, result in annual interest savings of USD ~0.77m and eliminate non-cash charges of USD 2.9m per year. The warrants will be purchased for a total amount of USD ~1m and prevent dilution of 4.3m shares, bringing total prevention of dilution up to ~15.9m shares. Pursuant to the previously announced share buyback program, SHIP has bought back USD 1.6m ($0.998/sh) worth of shares, whilst also announcing an additional program to buy back USD 10m of additional common shares. Last but not least, the Chairman and CEO bought an additional 300,000 of the Company’s shares in the open market within the last 3 months, reaching at least 600,000 shares along with the previously announced share buybacks he had completed.

Others have discussed the operational success Seanergy has achieved. In his introductory speech, Nigel Lowry, a Lloyd’s List Greek correspondent, emphasized not only the successful financial transformation of the company but also “its sole concentration on the Capesize sector following the company’s 70% fleet increase during 2021 only, as well as Seanergy’s ability to navigate remarkably through unprecedented adverse market conditions.”

In an industry ravaged by the vagaries of a now years-long global pandemic, Seanergy’s  vessels reportedly continue to sail with minimal interruption, delivering goods that consumers need to carry out most basic life functions through to high-level activities of humankind.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.