Eagle Bulk adds two scrubber-fitted Ultramaxes, offloads three older bulkers

Dry bulk shipping company Eagle Bulk has acquired two high-specification, 2020-built scrubber-fitted Ultramax bulk carriers for $60.2 million.

These vessels, renamed the Halifax Eagle and Vancouver Eagle, are expected to be delivered during the second quarter, and will enhance the company’s fleet of midsize drybulk vessels.

Meanwhile Eagle Bulk has sold three 2011-built non-core, non-scrubber-fitted Supramax bulkers, Montauk Eagle, Newport Eagle, and Sankaty Eagle, for $49.8 million, or $16.6 million each.

The reshuffling of the fleet comes as Eagle reports net income of $3.2 million for the first quarter of the year, against a net income of $53.1 million from the comparable quarter of 2022.

Revenues, net for the three months ended March 31, 2023, were $105.2 million compared to $184.4 million for the comparable quarter in 2022. 

“Against the industry backdrop of a seasonally weak market in the first quarter, we achieved a net TCE of $12,917 for the period, representing meaningful outperformance versus the benchmark BSI (Baltic Supramax Index). Based on recent developments and given our general view of market fundamentals for the balance of the year, we believe the first quarter will represent the bottom for freight rates in 2023,” Eagle’s CEO Gary Vogel commented.

“On the vessel sale and purchase front, we continue to act opportunistically to create value for our stakeholders. Following our recent accretive acquisitions of four modern high-specification Ultramaxes, we have taken advantage of a recent increase in both S&P liquidity and ship values to sell three non-core, non-scrubber-fitted Supramax vessels, which were purchased opportunistically just two years ago. Based on our calculations, we generated a levered IRR of 70% on this S&P transaction, inclusive of cash generated.”

Moving forward, Eagle is bullish about the medium-term prospects for the drybulk industry, particularly given strong supply side fundamentals.

The company said that with a fleet of 52, predominately scrubber-fitted vessels, and $235 million of liquidity, it was in a unique leadership position to continue to take advantage of opportunities on the market.