EuroDry reports Q4 adjusted EPS 70c, consensus 32c

Reports Q4 revenue $15.9M, consensus $14.17M. Aristides Pittas, Chairman and CEO of EuroDry commented: “During the fourth quarter of 2023, average charter earnings for our vessels continued increasing peaking up in the middle of December but then giving up most of their gains by early February. Time charter rates, after softening a bit in the beginning of the quarter, held their levels and have continued increasing modestly since. These rate developments partly reflect seasonal patterns and, partly, reduced throughput of the Panama Canal and Suez Canal, due to climate related reasons in the former case and hostilities in the area in the latter, that have resulted in longer voyages for some shipments. While we believe that the near term outlook will depend on the development of the situation of the two canals and current geopolitical conflicts and wars, a key area to watch remains China and its potential to drive demand growth, given the challenges in the property sector and sensitivity to government coal policy. Furthermore, the pace that inflation gets under control and interest rates ease should affect economic growth and, thus, trade growth. Against this demand picture, the low expected growth of the drybulk fleet provides a credible argument for strong drybulk charter rates over the next two to three years. The drybulk orderbook expressed as a ratio to existing fleet has been at historically low levels for more than three years leading in a significant underbuilding of the drybulk fleet. This combined with the effect of the greenhouse gas emission regulations that will very likely result in slower steaming and might even prevent some vessels from continuing to trade, should ensure a very limited fleet growth.”