John Wobbensmith, CEO of Genco Shipping (GNK), joined J Mintzmyer's Value Investor's Edge Live on June 14, 2022, to discuss the dry bulk markets and forward prospects and capital allocation. Genco Shipping is a major US-listed dry bulk company with 44 vessels on the water. We discussed overall dry bulk fundamentals, ranging from China's impact on markets to the impact of the Ukraine invasion on midsize trade routes in grain and coal. We also reviewed the economics of GNK's scrubber program and the updated shareholder returns program. Genco will pay out nearly 100% of free cash flow going forward and aims to be net debt free by next year.
This interview and discussion is relevant for anyone with dry bulk investments or interest in the overall sector, including Diana Shipping (DSX), Eagle Bulk (EGLE), EuroDry (EDRY), Grindrod Shipping (GRIN), Golden Ocean (GOGL), Navios Maritime Partners (NMM), Pangaea Logistics (PANL), Safe Bulkers (SB), Seanergy Maritime (SHIP), and Star Bulk Carriers (SBLK).
Topics Covered
(0:00) Intro/Disclosures
(1:45) Dry bulk market overview
(6:00) Additional color on China dynamics and Ukraine impacts?
(10:45) Updated views on market vs. early-2022 expectations?
(14:30) Will elevated opex levels remain going forward, or just a one-off?
(17:45) Update on scrubber spreads and company strategy?
(21:30) Any interest in secondhand vessel acquisitions?
(23:30) Desire to further reduce debt or still targeting net debt zero?
(25:30) Any interest in repurchases?
(27:30) Discussion on the merits of zero net debt strategy.
(35:45) Review of newbuild markets, any interest here?
(39:00) Why invest in GNK vs. other dry bulk peers?