Diana Shipping 1Q17 Earnings Call Notes

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Stasi Margaronis

Dry Bulk shipping market is back in balance

“So what we can say now is that we are not able to tell you whether we’re going to see another 2007, 2008 market developing. All we are saying is that it appears that we are at a point of balance between supply and demand. And depending on the strength already factors affecting this balance, the market is going to move rather up or down. We hope it will not go down, but it might. The chances are that unless something totally unpredictable takes place, it will move gradually upwards. So that’s all we can say at this point. We are just watching the market quarter after quarter. And this might be the first quarter where we can say with a degree of certainty that we are at the point where demand and supply have reached balance.”

Ioannis Zafirakis

This is a very very important development

“Ben, this is very, very important. It is one of the most important developments we’ve had the last seven years or so that we are in a position to say with a certain degree of certainty that we are in a balancing stage. This is very important because the previous years, a lot of time was wasted trying to see what the next period is going to be by calculating forecasted demand and supply, coming up with a number, which had no effect whatsoever or even the opposite effect than anticipated simply because we were not in a balancing stage and we kept saying that. I don’t want to repeat myself. But we were at the stage that we had, let’s say, exaggerating, 1,000 extra vessels. And people were talking about a positive effect of 50 vessels. And they were expecting the market to improve from 1,000 to 950 extra, the market to improve. You know that this never is going to happen. But if we can say with certainty that we are in a balancing stage, then the forecast, if they are correct, that will have an effect. This is what we are saying.”

We have managed to buy at the lowest part of the cycle

“We have managed to buy at the lowest – the lower part of the cycle as many vessels as possible. We have managed to leverage up the company to the maximum without having to restructure. And if the market improves as we expect the market to improve from now onwards, all the benefit of that is going to go to our shareholders and not to anybody else and especially not to those people that they offered a restructuring to the companies, of course, taking most of the upside of the market. So what we expect to happen is that if and when we end up at the upper part of the cycle, the company most probably will – we will reintroduce a dividend and we will renew the flip, getting rid of the older tonnage. And most probably, we are going to continue exactly the same strategy as we’ve done in the upper part of the previous cycle and remunerating and rewarding our shareholders for having invested in our company. “