Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Conference Call on the Second Quarter 2022 Financial Results. We have with us today Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. [Operator Instructions] I must advise you that this conference is being recorded today. Please be reminded that the company announced their results with a press release that has been publicly distributed. Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. I kindly draw your attention to slide two of the webcast presentation, which has the full forward-looking statement and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. And now I'd like to pass the floor over to Mr. Pittas. Please go ahead sir.

Good morning, ladies and gentlemen. Thank you all for joining us today for our scheduled conference call. Together with me is Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the six months period and the quarter ended June 30th, 2022. Let's go to slide three. Our income statement highlights are shown here. The second quarter of 2022 was another great quarter for us producing the best results since our inception. With an extremely high charter coverage for the remainder of the year through 2024, we expect to be able to deliver robust profitability for the next couple of years regardless of market developments. For the second quarter of 2022, we reported total net revenues of $48.5 million and net income of $30.7 million or $4.54 per share diluted. Adjusted net income attributable to common shareholders was $29.6 million or $4.08 per share diluted. Adjusted EBITDA for the period stood at $34.2 million. As part of the company's common stock dividend plan, our Board of Directors have declared a quarterly dividend of $0.50 per share for the second quarter of 2022, which will be payable on or about September 16th, 2022 to shareholders of record on September 9th, 2022. This underline corresponds to a yield of about 7%. As of august 10, 2022, we have repurchased 40,000 shares of our common stock in the open market for about $900,000 under our share repurchase plan of up to $20 million, which was announced in May 2022. Tasos will go over the financial highlights in more detail later in the presentation. Please go to slide four where we discuss our recent chartering and operational developments. During the second quarter, we took delivery of motor vessel Emmanuel P and motor vessel Rena P May…

Thank you very much Aristides. Good morning from me as well, ladies and gentlemen. As usual, I will now take you through the next five slides of our presentation and give you an overview of our financial highlights for the second quarter and first half of 2022 and compare them to the same period of last year. For that let's go first to slide 17. The company reported total net revenues for second quarter of $48.5 million, representing a 165% increase over total net revenues of $18.3 million during the second quarter of 2021, the increase being the result of the increased time charter rates [indiscernible] in the second quarter of this year compared to last. Due to the increase in the number of vessels, we own and operated in the second quarter of this year again compared to last year. The company company's income and net income attributable to common shareholders for period was $30.7 million as compared to a net income of $7.9 million and net income attributable to common shareholders of $7.6 million respectively for the same period of 2021. Interest and other financing costs for the second quarter of 2022 amounted to about $1.1 million compared to $0.7 million for the same period of 2021. This increase is due to the increased amount of debt and the increase in the weighted average LIBOR rate that we pay in the current period compared to same periods of last year. Adjusted EBITDA for the second quarter of 2022 was $34.2 million compared to $10.3 million achieved during the second quarter of 2021, an increase of 231%. Earnings per share attributable to comments shareholders for the second quarter of 2022 were $4.26 and $4.24 basic and diluted calculated on 7.2 weighted average number of shares outstanding as compared to…

Thank you, Tasos. May I now open-up the floor for any questions you have. Thank you,

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Thank you. Our first question is from Tate Sullivan with Maxim Group. Please proceed with your question.

Thank you. Good day. With your comments about no scrapping this year, but then with the rates, the potential for rates to decline meaningfully in 2023 And then taking delivery of nine new builds over the next three years, two and a half years? What's the balance sheet look for? When would you decide to start to scrap some of your older ships? Would we have to see rates decline for those ships to below breakeven levels? Or would you look for some other factor? Please.

Sure. Of course, everything will depend on how the market develops, right? Depends. So we're not taking any decision now about what we're going to do in 2024, when essentially most of these charters end. We've got a couple of years left for most of the ships, which are under employment, so we will take the decision much closer to the time, if at that time the market is terrible, then probably we will scrap them. If the market is imposing well, and the seats are worth passing the next way and can still contribute, we will keep them. It's a decision for the future not for now.

Okay. Thank you. And then, you comment on the new builds in three year rates well, in general, in the market, three year rates, no longer available currently, but are you still try going to target potentially one or two year rates or, or even shorter based on just depend on how severe the decline is at 2023 for the new build contracts?

Again, this is not the decision that I think will be taken this year, except if we see a sudden strengthening in interested in demand for longer term charters. We would prefer to fix longer term, but we've got a lot of time to wait till then because the next the first vessel to be delivered to us only comes in the third or fourth quarter of 2023, fourth quarter actually. So we've got more than a year's time in that ship delivers. And we will wait and see.

And even with the rate decline, and if you look at the literature of charter rate you can see that there's a decline assumed there is the levels are way above what our new buildings breakeven and would be significant profitable anyway.

Yes. But yeah, great point. And also just a quick run on the capital ratio based on the NAV, I mean, are you still on a fully delivered basis? Potentially, I mean, with your nav ratio below capital ratio below 20% based on a fully delivered basis or basis, are you targeting 35% capital ratios?

I think we mean, you mean the financial, right?

Yes. Yes.

The new building, we intend to finance on the order of 50% to 60% of the contract price as a base, and we see what our options we have. So if you blend the card leverage, which is below 20% of the base of market values in the, let's say, 60% leverage of the new buildings, we will be in co-pay below 40% of our leverage, even assuming a decline of our aging of the vessels.

Okay. Thank you. Thank you, both.

Thank you, Tate.

Thank you. Our next question is from Poe Fratt with Alliance Global Partners. Please proceed with your question.

Good afternoon, Aristides. Good afternoon Tasos. Several questions. First of which is a housekeeping item. It looks like over the last two quarters your commission rates have dropped into the 3.5% range from you know closer to 100 basis points higher have commission rates declined or is that just something is something else going on their?

Well, the commission rates really depend on who the charter is and through which channels we are able to fix them. There's been a few fixes with very little commission rate charge which affects the average, but I wouldn't consider this as a normal.

If you look at the release that we have on our website, you will see at least in one case, there is an attending the era is sort of net of commission because the way that deal was developed we have built the absolute lower commission rate because it is paid before the results. So we don't record it, and that in really what reduces the average.

Okay. Yeah, I'm just using 4.5%. So just wanted -- fine tune that. Then secondly, if you could talk about, the updated EBITDA calculated on page 19. It didn't look like 2023 and 2024 changed much from the bottom line totally EBITDA number. But the EBIT done number versus the first quarter went down just about, almost $7 million. It looks like you know, some of that was dry-docking expenses. But can you just talk about the changes in the second quarter EBITDA calculator versus the first quarter EBITDA calculator?

Yeah. These are meant to be due to the fashion and the assumption that is put on those tables has to repeat the existing contract or pay to aromatics assumption, if you want to put that ratio there is we were key were different at towards the existing contract that would result in a difference or it could be the other wanting operating costs due to discern this quarter or higher drydock cost or of a drive for more quarters than others. So those were the reasons that might change the EBITDA on the margins.

--:

I need to get back to you on that to give…

Okay.

But to answer, a set of vessels that should result will shift it and change the address or something like that, I need to get back on that one.

Okay. It didn't look like the 2023 drydocking nor that 2024 drydocking estimates changed at all. So just nitpicky, but just wanted to check that out. Then if you look on page 20 that your drydock expenses are up over the next 12 months, so your interest expenses. So your breakeven is up about $750 on a pre-debt amortization schedule. What other than what you've already talked about? Is there any anything else going on as far as pushing those numbers up?

--:

Either drydocking or the interest expenses, the interest expense seems to be going up pretty materially relative to last quarter. And your debt expense or debt load shouldn't have gone up that much. And your capital structure hasn't -- shouldn't change much over the next 12 months. So just trying to figure out why that would be up $380 relative to the first quarter?

In that range, higher obviously [indiscernible] that in some extent. Secondly, the interest expense might include maturity debt which we maintain once it comes from vessels. So that might meet the debt levels that is about 20% higher, and already -- over the next two years, over the next four quarters, we will have a at least the quarter of newbuilding delivers over -- interest on that as well.

Okay. And then can -- you sort of talked about the contracting environment right now more on the newbuilds, it seemed like more versus the existing fleet. Can you just talk about some of the upcoming fixtures that you're looking at whether it's the Akinada Bridge or the Hydra others that are coming up over the next six to nine months?

Yes. We are not discussing currently any potential started for the next vessels, we are having some preliminary discussions on the Akinada and what its future will be, but really nothing to report yet.

In the [indiscernible] four months before that, the next one was the Joanna, which open sometime in January 2023. So those are the two vessels that we might be using over the next quarter.

Okay. Sounds good. And then can you talk about the stock buyback program and just the cadence whether it seems it's good to see the stock buyback. But I'm surprised to see amount wasn't a little bit larger, given the context of where the stock was, can you just talk about sort of the cadence on that $20 million program, and there's a lot left and just any color you can give us on this stock buyback program, that would be helpful.

Sure. The issue is that you cannot use the stock buyback program during a period, a quiet period. So the last month and a half when the stock was really depressed, we could not use it, because of all these constraints. Therefore, we didn’t have the opportunity to implement more which we would have done at the levels that you saw that we bought for the 1 million worth of stock that we did.

Great. That's helpful.

Stop using more than around July 10th, I believe.

July 10th. Great. Thanks for your time.

Thank you.

Thank you Poe.

Our next question is from James Jang with Univest Securities. Please proceed with your question.

Good afternoon guys.

Hi, James. Nice to hear you.

Nice to hear you. Yes, it's been a while. How everything is going well for you guys? Just a couple of quick questions. I probably know the answer to this, but I do have to ask. Since you have three new boats coming in in 2023. And you've got the two the Akinada and the Joanna coming off charter this year. Would you look to possibly sell those vessels after the charters are completed since rates are pretty strong in 2023, could be a little more challenging for long-term rate in charters?

It is always under consideration. It's in our mind. So we are confused about that possible path as well. So we're looking at that, too. But most the options are mostly amongst the option of chartering it's continued, it's monitored continuously.

Okay. And what the dividend just looks like with the contracted vessels even though let's say you, it'll be hard to contract that the vessels are coming off to the first half of 2023, would you say the dividend is safe at a decent?

The dividend, we decided to do repeat the previous dividend. We consider the yield that is made on the stock quite satisfactory. And we will see next quarter what we will do and the effect will remain the same. But the main assumption it remains -- that it remains the same until it change.

In the institute the dividend going to take it only in the couple of quarters. So, I think although a lot depends on the market, and of course, our boat may decide anytime differently. As Aristides mentioned the underlying belief is that it would be here for one.

Okay. Understood. And just on an operational front, the Akinada and the Joanna -- charter, where will they be positioned? Would they be in the Pacific, the Atlantic?

I think they're both in the Pacific. But I don't think that is that important. Charter rates are quite similar today in the various positions.

Okay. So any -- have you seen any big discrepancies between charter rates between the two halves Pacific or Atlantic? Or is it just because the market is strong right now, it doesn't matter, and there's no real repositioning fees or anything else?

Yes. I would say that at this point, there isn't any real big differences.

Excellent. Those are all the questions I had. Thank you guys.

Thanks, James.

Thanks, James.

Thank you. There are no further questions at this time. I'd like to turn the floor back over to Mr. Aristides Pittas for any closing comments.

Thank you all for standing with us and listening to our presentation today, and we'll be with you in three months' time for the next quarter's results. Thank you.

Thanks, everybody.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.