Thank you for standing by ladies and gentlemen and welcome to the Seanergy Maritime Conference Call on the Second Quarter 2019 Financial Results. We have with us Mr. Stamatis Tsantanis, Chairman and Chief Executive Officer; and Mr. Stavros Gyftakis, 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 advice you that this conference is being recorded today. Please be reminded that the company publicly released its financial results, which are available to download on the Seanergy website at seanergymaritime.com. If you did not have a copy of the press release, you may contact Capital Link at (212) 661-7566 and they will be happy to send it to you. Before turning the call over to Mr. Tsantanis, we would like to remind you that this conference call contains forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, concerning future events on the company's growth strategy and measures to implement such strategy. Words such as expects, intends, plans, believes, anticipates, hopes, estimates and variations of such words and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks and are based upon a number of assumptions and estimates, which are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to; competitive factors in the market in which the Company operates; risks associated with operations outside the United States; changes in rules and regulations applicable to the shipping industry; and other risk factors included from time to time in the company’s Annual Report on Form 20-F and other filings with the Securities and Exchange Commission, the SEC. The Company's filings can be obtained free of charge on the SEC's website at www.sec.gov. The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with respect thereto and any change in events, conditions or circumstances on which any statement is based. Now, I’ll pass the floor to Mr. Tsantanis. Please go ahead sir.

Thank you, Joan. Good morning everyone and thank you for joining us today to discuss our results for the second quarter and six month period ending June 30, 2019. The first half of 2019 was one of the weakest periods in the recent history of the capesize market. The severe market downturn that we experienced especially between February and May was driven by a major blood borne event as well as other seasonal and weather factors. Primarily the freight market was affected by the dam accident in the Brumadinho mine of Brazil, which caused the sharp reduction of the Brazilian iron ore exports from an average of 7.5 million tons per week to a low point of 2.5 million tons in April. The importance of the Brazilian ore in the market is well known not only for the higher grade of the product itself, but also for the longer routes that is required for it to be exported to the factories. In addition, adverse weather conditions of course in Brazil and tropical cyclones in Australia affected negatively the seaborne iron ore trade. The reduced availability of iron ore in the market resulted in the sharp increase of the price of the product from approximately $7 per ton to approximately $120 per ton and in fewer cargo shipments with lower vessel utilization. In addition, rates in the Pacific weakened as a result of the increased vessel concentration in the area as owners have been repositioning tonnage for scrubber installations at yards in China. The Baltic Capesize Index, or BCI, plummeted from around 2,000 points in the beginning of the year to a low of 92 points in April. Concerning Time Charter Equivalent performance, Seanergy’s TCE for the second quarter was around $9,100 per ship per day increased by 3% by $8,900…

Thanks Stamatis. Good morning everyone and thank you for participating in our call. Let me start with a few updates relating to our loans. Firstly, concerning the subordinated facilities and convertible notes with Jelco, the entity affiliated with the sponsor family. Following the private placement, which was completed concurrently with that follow onoffering in May, all interest payments due on such facilities and notes were strategictime through the units placed in Jelco. The total interest amount that was essentially eliminated through this arrangement was approximately $6 million alleviating considerable threshold open breakeven. Regarding our senior secured loans, the amendments that were announced in previous disclosures including the scheduling of approximately $3.3 million in principal payments for 2019 have now been finalized and are no longer subject to documentation. Before moving on to discuss the financial results for the period, I want to note that the bulk of the graphic measures taking in the five, six months that we’d discussed earlier by Stamatis. Our liquidity position in cash flow was improved to the extent that will allow us to fulfill timing, our commitments, while also facilitating the success with financing of our facilities that are maturing within the next 12 months. Going to our financial results for the second quarter of 2019, net revenues amounted to $18.8 million replacing a 12% increase compared to net revenues of $16.8 million in the same period of 2018. The positive – not the duty to the change in the composition of our fleet as we operated a larger number of cases versus with generally add highest trade. This was partially offset by 9% decrease in ownership days during the second quarter, due to the disposal of two Supramax units that were replaced by one Capesize and a decrease in other market rate of the…

Thanks, Stavros. The event that have taken place since our last results announcement, have generally enforced our belief for the dry bulk market is in the middle of the cost trend at the likely to last for the next few years. The abrupt reduction of the availability of iron ore from the market as a result of the mining disaster in Brazil at January, has given way to nickel fast recovery in trade volumes since the end of May. While, the overall iron ore trade is expected to decline 2.6% in 2019 the second half volumes are expected to surpass those in the first half by at least 40 million to 50 million tons. Moving on to the supply side and vessel capacity. And the vessels capacity required to accommodate increased volumes. The market appears to be experiencing a decline in the availability of Capesize vessels. The main reason for the shortage of tonnage is increased scrub installations in other relevant retrofits to comply with the upcoming regulations of the IMO 2020. We expect the number of unavailable Capesizes to increase moving towards the end of the year, which may create a major tonnage supply squeeze. We strongly believe that the worst is behind us and looking beyond 2019 growth in seaborne trade of iron ore is expected to accelerate by 2.9% according to Clarksons, regarding fleet supply, the Capesize fleet is expected to grow by around 2.2% in 2020, decelerating from 3.4% this year. The continued installation of scrubbers and Capesize vessels beyond January 2020, as well as the anticipated slow streaming effects of the non-scrubber ships should continue to be a dumper on effective fleet supply which suggests the actual growth may end up being much lower than the anticipated 2.2%. As a result of their both supply and demand dynamics, we remain confident that the positive trend established in the Capesize market over the past two years, we expect it to continue beyond the second half of 2019. Seanergy is well positioned to capture the improvements in the market based on our Capesize fleet, our employment strategy, and our concise approach towards IMO 2020. With that note, I would like to turn the call over to the operator, to answer any questions you may have. John?

[Operator Instructions] Your first question comes from the line of Tate Sullivan from Maxim Group. Please go ahead. Your line is now open.

Hello. Thank you. Good Day and thank you for those updates. And a question on the fleet mix, given the detail you gave on the scrubber installation that are pending for five out of 10 ships. Are these towards the plans for the other five ships? And I saw that the leadership was in the yard for a survey what boat did not have the scrubber installation, can you give any detail on potential timing for those installations, if any please?

Of course, thanks for the question and good morning. As we discussed in the presentation is expected to show in a day now. So in the next couple of days we will have a result. The [indiscernible] as the scrubber installation is going through immediate survey is expected to sail on about the August 10. So we expect it to arrive in Brazil for loading around mid-September. And the – ship which is going to be installing scrubbers, is expected to sail from the shipyard around August, 22 and August 24. The final question about, what types of ships we are looking for scrubbers. We'll look up scrubbers had to work with fewer, with those getting delivered in November and December of 2019. So we have already started that approach and strategy in order to head the supply or bunch of fuels at the end of the year. We have already committed to acquire the testing alone, so specific clients are ready for a specific quantity where we cannot disclose the amount in the price of looping that you think is going to be very competitive, given the fact that the market is going to be squeezed out towards the end of the year. So just thinking about the strategy, the ships that will [indiscernible] compliant fuel and we expect the availability to cover the first quarter of 2020, we have already started making measures to meet the need.

Okay, thank you for that detail. And on the balance sheet and cash flow statement for the quarter as well. I mean, cash increasing from $7.5 million in the prior quarter to about $13 million in 2Q19, including the offering proceeds, were there any other cash events and you paid down debt on the balance sheet by $7 million, were there any sale leasebacks in the quarter or other cash eventually? I did not catch please.

Hello, it's Stavros. No, there were no positive equity events as discussed in the coal, we have around $7 million in driven commitments on their own facilities and notes which are not reflected in the balance sheet. So the total – resources of the company as well as the end of the quarter amounted to around $20 million.

Okay. Okay. Thank you for that detail as well too, on the scrubber and no sale leasebacks in the quarter two. And that's it for me. Thank you for all the detail. Have a good rest of the day.

Thank you Tate. Thank you.

The next question comes from the line of Poe Fratt from Noble Capital Markets, please go ahead. Your line is now open.

Good mornings Stamatis, if we could get scrubbers, just give us a couple of figures for the quarter, what was CapEx and then also if you have working capital changes handy, that would be helpful.

If you don’t mind, repeating the question, I mean CapEx you mean for the drydocks?

Just overall CapEx, what’s going to work with cash flow statements? Stamatis, whether you want to break it out or not or how much the scrubber cost was versus the drydock, however, you wish to present it?

Yes, yes, we will discuss that exactly.

So the remaining CapEx which are due until the end of the year is around $11 million. The majority of this is covered through the arrangement that we have with our charters and the [indiscernible] which leads fortunately around 20% of this fleet to cover through its own liquidity means.

It’s sounds great. Do you have the working capital number for the quarter, for the second quarter or even the first half of the year?

Well, the working capital, I mean, basically there was a negative working capital due to the fact that the market was very weak in the second half of the year. So there was basically, as far as the normal operations of the company and the drydocks that would have been cared in the second half, sorry in the second quarter. There was a negative working capital of about $12 million altogether.

That was for the first half or the second quarter?

That was second quarter. The average for the first half, I will tell you is around $7 million about something like that.

Great. And then when you look at cash interest of $3.8 million during the quarter, where do you think that’ll land in the third quarter and the fourth quarter? I mean, is this a structural change where you’re going to see cash interest in the $4 million range or sort of, can you just give some color on that?

Yes. Cash interest for the third and fourth quarter will be at the same levels as the ones seen in the second quarter.

Great.

Around [indiscernible]

Okay. And then Stamatis, could you comment on your competence and cap rates you are paying a pretty bullish picture for the remainder of the year. You’ve already booked more than 60% at a really healthy rate. In the context of where you think you might consider locking in to longer term that would be helpful to get color on that.

Of course. And we strongly believe that the second half of the year the market is going to be very strong. There are two main reasons for that. Number one is that there’s going to be more and more iron ore availability as a product into the market. Vale alone gave guidance for the second half of the year that they are going to export 170 million tons. That’s about 40 million tons in excess of the first half of the year. So that by itself is a huge improvement in the availability of cargo. And as we know the turmoil effect on the long-haul product for the particular route makes it even stronger thing. But what is actually going to boost them is going to be a strong capital into the market, is the availability of tonnage. As I mentioned before and given the experience, I recently just came back from China that I went through various shipyards to monitor the scrubber fitting process. It appears that most companies installing scrubbers in the capesize are running into severe delays. And only a small percentage of the fleet that was initially scheduled to install scrubbers has completed the process, which means that in order for all the fleet to make it on time until the end of the year, this is going to accelerate as a pace significantly in the months of September and October and even further. And just to give you an idea, I mean, one particular shipyard that I attended earlier in the summer it was around 18 ships waiting in line to get scrubber fittings and lots of whole size. And now as we speak right now, the pipelines for the – concurrent [indiscernible] that is in excess of 30. It’s almost double the capacity of the shipyard. So we expect very severe delays and a lot of capesize tonnage to be caught up in this kind of situation. And at the same time, we had a much stronger demand and export level. So I think, as I mentioned before, this is going to create a very strong supply squeeze in the market and the rates to be pushed upwards. That’s of course assuming that nothing goes wrong and happens again. But with the current data that we have so far, it appears it’s going to be a very strong second half of the year.

Great. And where do you think you’d lock – considering locking in? I mean pretty much the entire fleet’s index and the spot market right now. And where do you – any number that you sort of focused on as far as locking in?

Well, I mean we are close to the levels that we will consider starting; I think some sort of repeated employment. We are almost 20,000, 21,000 right now with the period mentioned for the next year. I think that when we start to ship 22,000 to 23,000 as a period rate for year and onwards, I think that we will start considering looking in some of deployment into bigger deployment. I also remind you that the majority of our Index-Linked Charterer have the provisions as we can swap that from floating to fixed for a period of between three and 12 months, so we can do that as well. So all the fleet potentially up to 7 point, the majority of the fleet could potentially be converted into the period market, but that's longer in the future, right now we’re focusing on the short-term improvement. And when we start to see something, which we believe to be compelling and enticing, we will stop from getting fair amount of period of time.

Yes. And then if we could focus on the equity offering, can you just walk through the decision process you went through and just how you chose to structure for old shareholders, clearly it wasn't very advantageous and I was just wondering sort of how – how bad was it? Were you out of cash? I mean it just – you just destroyed so much shareholder value for the former shareholders. And I was just hoping for some color on that, and frankly, do you have any regrets on how you structured that equity offering?

Well, it's a good question actually. And thanks for giving us the opportunity to discuss that during the call. When the market plummeted from 2000, from today the BCI is down to 80 points, the effective points are equivalent that to the Capesize segment was making – was about zero. So we've had zero revenues at the time. Not just us, but the overall Capesize market for the period of time was at zero. When you have a breakeven point of let's say $16,000, $17,000 a day it's in a normal market conditions, so that would have been an amazing productive. So simply for example is losing about $5 million a month from a cash flow perspective. The compensation takes up and measures. The first measure that we took is to start production in a certain opening that we think within that could have implied. And number two, to access the banks and to the liquidity factors that were available most of the time in order to do that. As a combination, we managed to increase our liquidity by about $12 million from the banks with values – new facilities that we signed, as well as principal postponements for 2019. And at the same time we decided to pursue business structures offerings, which demand [indiscernible] filed on the 1st of April. So we found the perception 1st of April and we actually privatized transaction on May 15. So the transaction and then all the structuring, all the process and everything was out there in the public for about 43 days. So contrary to a number of our fears that we're just signing private placement agreements in the convertible facilities and all that, the government decided to pursue this offering in a public opening commandments where without the perception as one, the full description of the deal was out there for about 40 days. We actually approached a number of our existing largest shareholders to participate if they want it. Some of them did, some of them did not, but we gave them the opportunity and the time to consider this offering. So for us it was a time where we needed to take a defensive measure towards the market that was effectively making zero. If you remember back in April, there was more guidance as to when the certain system of Brazil was going to start exporting iron ore again, the month it was again zero, Brazilian is quite low, but still much higher than the market and we need to take a defensive approach, this is what we did, we increase the liquidity of the company by around $33 million and now we believe that in the second half of this year with a significant market increase that is going to be in a far superior position to take advantage of this market.

Great. That's helpful Stamatis. But the one question I have is from a structure standpoint, do you regret using the Class C warrants? Essentially it was self fulfilling prophecy where essentially the warrants were just so dilutive and not only were they dilutive but they were mark-to-market pretty – we've just created death spiral in the stock. And I was just wondering whether you regret using that structure at all?

Not really because we actually contrary to a number of our peers that have been diluting over infinite reverse stock split the current shareholders, what we did is that we put a floor price on the exercise price of the ones, and that did not created the spiral, but at the same time it kept the actual dilution effect to 2.74. So we put a very strong cap on the actual dilution effect and the floor price of $1. So this shows exactly the spiral, but on the contrary it was a well measured dilution effect, which we communicated to the public and to our investors from the beginning of the process, that formula and all these data points were included into the prospects of the files on April the 1st. So not only it was an infinite dilution contrary to the peers, we actually put as floor price and we put a matching dilution multiplying factors to 2.74. And to answer your question, when the market is making zero and you need to have access to [indiscernible] you need to find the best way in order to protect your shareholders by doing an equity deal. At the time we investigated the market opportunities for certain equity deals and as Management and Board of Directors of the company will conclude it, that deal was with best approach. And again it was a public offering, the prospect is resulted for 43 days, to give the opportunity to all of our existing shareholders who participate and this is what was best for the company at that time, and what was best available in the market in order to get us the liquidity that we wanted, in a very difficult market environment.

Great. And I just want to sort of double check, the convert that was not – the strike price on the convert debt of – I think it’s 13-15 previously, that has not changed at all.

No, nothing has been changed. We did not include I mean assets or anything hedges to anyone, that deal was basically price of the same terms for all the shareholders and that’s again contrary to the majority of our peers that are not doing the same approach, the company decided that we were going to offer to give to all of our shareholders, giving them an ample time to consider all the pros and cons of the transaction.

Great, thanks.

You’re welcome.

There are no further question, please continue. That does conclude today's conference. Thank you for participating, and you may now disconnect.

Thank you to all. Have a good day, everyone.