Good morning. Before we begin our presentation, I note that in this conference call we will be making certain forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Such forward-looking statements use words such as anticipate, budget, estimate, expect, project, intend, plan, believe and other words and terms of similar meaning in connection with the discussion of potential future events, circumstances or future operating or financial performance. These forward-looking statements are based on management's current expectations and observations.

For a discussion of factors that could cause results to differ, please see the Company's press release that was issued yesterday, the materials relating to this call posted on the Company's website and the Company's filings with the Securities and Exchange Commission including, without limitation, the Company's annual report on Form 10-K for the year ended December 31, 2020, and the Company's reports on Form 10-Q and Form 8-K subsequently filed with the SEC. At this time, I would like to introduce John Wobensmith, Chief Executive Officer of Genco Shipping & Trading Limited.

Good morning, everyone. Welcome to Genco's third quarter 2021 conference call.

I will begin today's call by reviewing our year-to-date highlights, providing an update on the company's new comprehensive value strategy, financial results for the quarter and the industry's current fundamentals before opening the call up for questions. For additional information, please also refer to our earnings presentation posted on our website.

Since announcing our comprehensive value strategy in April, we have worked diligently to implement this strategy to drive shareholder value our approach centers around growth, financial de-leveraging and positioning Genco to distribute compelling dividends. During the third quarter, we continue to execute on key initiative covering all components of our strategy and are on schedule to declare our first dividend under our new policy.

In terms of opportunistic growth, during the quarter we grew our core minor bulk fleet 227 vessels on a pro forma basis, which effectively compliments our major bulk fleet of 17 Capesize vessels by taking delivery of four Ultramaxs in August and September, we now have more than double the number of Ultramaxs we owned at this time last year, strengthening our position to benefit from the favorable fundamentals in this sector. Addition, we expect delivery of two additional Ultramaxs in January of next year to further augment our earnings power.

We also made significant progress proactively deleveraging repaying $144.2 million of debt or 32% of the beginning of the year debt balance through September. Given the strong market in the year-to-date and the important role deleveraging plays in our value strategy we accelerated our debt repayments to further fortify our balance sheet as we position the company to distribute sizeable dividends in diverse rate environment.

Importantly, both our debt pay downs as well as vessel acquisitions were funded without the need to raise equity capital in the public markets highlighting not only the significant operating cash flows of the company and the year-to-date, but also the strong financial foundation that we have built over the last several years. Additionally, we closed on a $450 million credit facility, which includes a $300 million revolver.

This facility has improved key terms and helped to lower our cash flow breakeven rates, which Apostolos will discuss in further detail later on the call. Regarding returning capital to shareholders and our current quarterly dividend for the third quarter, we increased our payout to $0.15 per share our third consecutive quarterly.

We have now declared a total of $1.055 per share in dividends over the last nine quarters. We expect to continue on this upper dividend trajectory with the first dividend under our value strategy to be paid based on Q4 2021 results during Q1 2020.

As outlined in our presentation, our quarterly dividend calculation to be applied next quarter is based on operating cash flow, less debt repayments, drydocking CapEx and a reserve. We plan to repay $59 million of debt in Q4 2021, reducing our debt balance to $246 million by year-end representing what would be a 45% decrease from the start of 2021.

We estimate that our December 31, 2021 debt balance will be approximately 60% of the current scrap value of our fleet highlighting our strong financial standing. We believe this low financial leverage position together with a compelling and consistent dividend will provide an attractive risk reward balance that has been absent in dry bulk shipping historically.

Furthermore, our reserve for the fourth quarter is expected to be $10.75 million, which is based on $8.75 million of voluntary debt repayments planned to be made in the first quarter of 2022, as well as estimated cash interest expense on our debt. Continuing to pay down debt despite having no mandatory debt repayments required is consistent with our medium term goal to reduce our net debt position to zero and our longer term goal of zero debt.

We are focused on rewarding shareholders in the near-term through compelling dividends while continuing to deliver, to be in a position to reward shareholders over the longer term and support sustainable dividends. We view this as prudent to further improve our financial standing over time to put Genco in an even stronger position to take advantage of attractive growth opportunities as markets develop.

The reserve will be assessed on a quarterly basis by management and the Board of Directors and will be communicated in advance. Our quarterly reserve as well as optionality for the uses of the reserve are important factors for the corporate strategy as it enables Genco to be flexible depending on market conditions and providing more tailored approach to Genco's overall business model.

In addition to the measures taken to execute our value strategy from an earnings perspective, the third quarter was our strongest in over a decade led by net income of $57 million and our time charter equivalent rate of $29,287 per day. Additionally, our third quarter adjusted EBITDA was $79.8 million, which to put in perspective is higher than adjusted EBITDA for all of 2020.

Looking ahead to the fourth quarter, our estimates point to continued strong results with a TCE of approximately $37,000 per day, based on fixtures to date across the fleet for 71% of our owned available days. Consistent with our portfolio approach to fixture activity, which consists of mostly spot trading and opportunistic period time charters and forward cargo coverage, we have fixed seven vessels on period time charters for one to two years at rates ranging from $23,375 to $32,000 per day.

To best illustrate this in our earnings release we have broken out our fourth quarter TCE estimates highlighting our spot TCE in the quarter-to-date, which on our Capesize and Ultra/Supramax fleet is approximately $51,000 and $37,600 respectively. Importantly in line with our portfolio approach we also have approximately 20% of our Capesize days for the first quarter of 2022, fixed at $28,500 per day.

While we expect traditional freight rate seasonality to materialize in the coming months, we believe we're in a cyclical dry bulk market upturn. They remain solid visibility particularly on the supply side, given the historically low new building order book that will be supportive for the market over the coming years.

At this point, I will now turn the call over to Apostolos Zafolias, our Chief Financial Officer.

Thank you, John. For the third quarter of 2021, the company recorded net income of $57.1 million or $1.36 basic and $1.34 diluted earnings per share.

Adjusted for the loss and debt extinguishment related to our financing and loss and sale vessels adjusted earnings for share were $1.47 basic and $1.44 diluted respectively. During the quarter, we continue to further strengthen our balance sheet through operating cash flows by taking advantage of fair market conditions.

Our cash position as of September 30, 2021 was $80.5 million following $144.2 million of debt repayments through the first nine months together with $108.7 million paid to acquire vessels over that same period. Following substantially leveraging, our debt outstanding is $305 million at the end of the quarter, which after considering our cash position results in a net debt figure of $225 million.

In August we closed our new credit facility. The new facility consists of a five-year term loan together with a significant revolver that can be used for growth.

This new debt structure will provide improved capital allocation flexibility, and significantly use our cash flow breakeven rate, which combined with the strength of our balance sheet provides a solid foundation for our value strategy and our focus on distributing sizeable dividends to shareholders in diverse rate environments. As we continue to implement our comprehensive value strategy, we plan to pay down $59 million of debt during the fourth quarter to reach a target year-end balance of $246 million further strengthening our balance sheet.

Based on our year-end target debt balance, we would have no mandatory debt amortization payments until December 2025. Regardless of this favorable mandatory amortization schedule, we plan to continue to voluntarily pay down debt with a medium term objective of reducing our net debt to zero.

This new facility will also lead to a reduced cash flow breakeven rate for the company. Our fourth quarter 2021 estimated breakeven rate excluding any voluntary debt prepayments is $8,190 per vessel per day.

Our total ownership days for the fourth quarter are estimated to be 3,896, and we anticipate three minor vessels to enter dry dock resulting in approximately $2.9 million of costs and 60 days of estimated off higher time during the quarter. Lastly, during the third quarter we completed the sale of the Genco Lorraine, and we have now also delivered the Genco Provence to her new owners in November receiving gross proceeds of $13.25 million.

I will now turn the call over to Peter Allen, our SVP of Strategy to discuss industry fundamentals.

Thank you, Apostolos. During the third quarter of this year freight rates continued to increase to decade plus highs driven by augmented demand for raw materials, improving rate and seasonally strong iron ore volumes from Brazil, as well as continued reduction in fleet wide productivity.

Spot freight rates remained on the up-trend in early October with Capesize rates exceeding $85,000 per day and Supramax earnings approach $40,000 per day. Capesize and Supramax rates have pulled back from these decade plus highs to approximately $27,000 and $30,000 respectively.

This has been driven by easing of port congestion in recent weeks declining steel production in China and the beginning of the seasonal slowdown in iron ore shipments towards year end. Despite this recent downward volatility, there are still positive factors currently at play in the market, including increased demand for seaborne coal due to low inventory levels among several countries ahead of peak winter demand season, as well as historically low new building order book.

Furthermore, while China's government has been tightening policies throughout 2021, there is the expectation that in the coming months the government may become more accommodated into 2022 with more emphasis on achieving economic growth targets. Heading into 2021 our view was for a substantial recovery in demand for drybulk commodities in ex-China markets.

China had led the drybulk recovery from COVID related lows in 2020, while the rest of the world gradually began to recover towards year-end. However, in 2021 we have seen a meaningful uplift in economic activity and drybulk demand ex-China highlighted by steel production increasing by 16% year-over-year.

This has been welcome strength as China's output has slowed from record highs since May. While China steel production historically peaks in the second quarter, seaborne, iron ore shipments, the largest driver of drybulk trade historically peak during the second half of the year.

To that end, we've seen less of a correlation between China's steel output and iron ore imports this year and over the last decade. This is highlighted by freight rates reaching such strong levels in September and October despite lower levels of Chinese steel production.

Going forward, we anticipate the usual seasonal drybulk trends to materialize the coming months, highlighted by the onset of wet weather conditions in Brazil and Australia, which will likely limit cargo availability in those regions. The timing of new building deliveries at the beginning of the year, winter steel output restrictions in China, as well as the timing of the Lunar New Year, which coincides with the Beijing Olympics in February.

Despite near term volatility we believe we are in a cyclical up-trending market that came into balance in 2017 that was interrupted along the way by unique events including the and COVID-19. Our positive go forward thesis for the drybulk market is underpinned by the historically low order book.

The order book as a percentage of the fleet is 6.8%, which compares to 7% of the fleet that is greater than or equal to 20 years old implying fleet renewal more than material net fleet growth in the coming years. Encouragingly newbuilding vessel ordering has been relatively low this year despite the strong market conditions.

Our fleet growth in year-to-date is approximately 3%, which combined with increased port congestion throughout the year has led to a reduction in global fleet wide productivity. Overall, we believe these positive supply side dynamics provide a solid foundation for the drybulk market and lead to a low threshold for demand growth you have to exceed in order to improve fleet wide utilization and in turn freight rates.

This concludes our presentation and we would now be happy to take your questions.

Hi. Gentlemen, how's it going?

Good morning, Randy.

Good morning. So, yes, congrats obviously on the best quarter since 2008; I'm sure I'll say it again next quarter.

But let's talk about the spot market, right? Capesize rates very profitable levels still.

However they have fallen right from over 80,000, 85,000 a day, a little over month ago to under 30,000 a day currently. So I guess in your view, what's driving this recent Capesize volatility, and what's your outlook for the coming weeks and months as we head into kind of the seasonally soft first quarter?

As Pete mentioned Randy, I mean, I think there are a few things going on here. We're clearly seeing unwinding of congestion imports which is no surprise because that's also on the back of lower iron ore imports, which is mostly a seasonal factor.

But also we have seen obviously low steel production utilization numbers in China, which I think we're all aware is related mostly to power concerns in China and really putting their people in front of industry, which is obviously the right move by the Chinese government. I also think there is – there's a tremendous amount of volatility in the FFA market and it can and does have short-term effects on the physical market.

I think there's been a lot more financial players that have come into the FFA market over the last 12 months. And it seems we have some downward volatility, you can have some if stop losses kick in, you can have some wild violent swings, which is what I think we've seen.

And when that calms down, which it seems to be calming down, usually you then have a more stable physical market. So going to outlook, I actually believe that we could have another push up from where we are before the end of the year.

But I do think we're entering a more seasonal soft period as we get into in the first quarter. As I'm going to be optimistic and hope that the power issues and the coal stock pile in China are sorted out, mid-first quarter and I believe steel production once we get past the Olympics and Chinese New Year will recover.

I mean, you have to keep, I mean, if you put this into perspective, we're at, I don't know, somewhere around 78%, 80% utilization in the Chinese steel market today. And even if steel production remains flat for 2022, over 2021, we actually think there is going to be a couple points of growth, but let's just say it remains flat, that still shows a normal and probably fairly large seasonal recovery in steel production in the second quarter.

And I'm probably going on a little too long here, but let's not just focus on China. Let's focus on the rest of the world too.

We're stealing steel production recover across the globe. We're seeing another 4% to 5% in projected GDP growth for next year, all that bodes well for drybulk shipping, particularly when you're talking about a supply order book, maybe deliver of around 2% next year.

You just don't need that much demand growth to continue building off of what we've seen this year. So hopefully that was a – it was a long answer, but hopefully it covered your question.

It does. Yes, and I think we're on the same page and the call trade should be continuing to be elevated here in the coming weeks and months, so all fair.

I guess more on Genco specific, you mentioned your total debt will be under $250 million by year end with that you won't have any due – next year, but obviously you want to continue to reduce your debt levels. So just curious, how was the $8.75 million of COVID debt determined for 1Q 2022?

What will cause this trend to go higher or lower as the year progresses? Basically, just trying to get a sense for that expected reserve amount throughout 2022?

Look, it's a great question. And I would say in general we will be looking this – looking at this as on a quarter-by-quarter basis, giving advanced guidance on a quarterly basis.

But if we take the reserve that, that we put in play for the fourth quarter, and you do put a run rate on that, you'll get to $35 million of, of debt amort for 2022. What that $35 million does is that obviously we continue to pay down debt though we're not – we're at a level now where we're at 60% of scrap value of the fleet, but as Apostolos said we do want to continue to de-lever and one more year of $30 million, $35 million of debt amort, and then there is no amortization whatsoever on this credit facility until the term expires towards the end of 2026.

So what we've effectively done is turned a bank credit facility into a non-advertising bond with all the flexibility that get from a bank facility to be able to borrow and repay with the revolver that you don't necessarily get in the bond market. And by the way, price very well at LIBOR plus 2.15.

So that's – that was some of the thoughts around what we're targeting. But as I said, we can tailor it on a quarter-by-quarter basis.

But to do the numbers, you get to the run rate of $35 million, and I think that the biggest – we've said this many times we actually really want to make sure that we can put our hand on our heart and say we have a sustainable dividend model throughout any cycle. And the only way to do that is to continue to de-lever.

But I do think we're in a – we're just a fantastic spot right now. It's – we're in a better spot than the company ever has been and I think we've got the brightest long-term future that the company ever had.

So, and it's – we obviously want to reward shareholders in the short-term, but we also want to reward the shareholders that are going to be in the company five to 10 years from now as well. So that's the purpose of the model and I think it's a great risk reward balance.

Yes. We agree and looking forward to the bigger dividends going forward.

So thanks so much.

Okay. Thanks, Randy.

Thank you. Hey guys.

Hi, John, Apostolos. Good morning.

Good morning, Omar.

I wanted to follow-up on Randy's questions, just kind of about the market and how you are perceiving things and clearly there, and I know Peter Allen mentioned this in his remarks as well about the separation for a while there on the steel production and what was going on in China and then cape rate still being very firm, recently obviously things have come off, but you could make the case that the outlook remains very constructive. How does this with your view, how does this affect your trades business?

Do you see an opportunity in this sort of air pocket that we're experiencing to bolster that charter?

So you mean it charter and/or charter out Omar?

The charter in just take advantage of a lower rate here to…

Yes. No, look, fair enough.

Keep in mind; we do not have a business model where we charter in on a naked basis, if you will. So with the chartering group has been doing is like it normally does is continues to take forward cargos and then create arbitrage opportunities by chartering.

And so booking, obviously a higher rate on the cargo and then chartering it at a cheaper rate. I think those opportunities are coming to be more and more apparent.

So the answer is yes, but I – you will not see us go into the long-term charter market and charter in ships blindly, if you will without having some sort of cargo that at least de-risk both the front end or the initial back haul voyage.

Okay. Got it.

But I…

But I do see more arbitrage opportunities as we go into the – as we go into the first quarter right now.

Got it. Thanks, John.

And then wanted to ask on the sale purchase front, it's been six or seven months to established or the plan to transition the capital allocation policy along the way, as you de-levered you've acquired ships. You have two more deliveries coming next or in January.

What are your thoughts at the moment on the acquisition front? Are you do you take a step back and focus now on just taking these deliveries, paying down at debt and preparing dividend policy, or is you still see a chance to go out and acquire ships?

I think there's – I would say there's a little bit of a pause right now values certainly have moved up nicely, which we're obviously happy about from a fleet standpoint at an NAV standpoint. The transactions that that we did over the last five or six months, we could buy vessels and put them away on two-year charters to de-risk the purchase and pay off 50% on a unlevered return on capital basis EBITDA.

50% over the two years of that charter, that's just extremely compelling and we've been able to do that. Those opportunities are not there right now, but I would also caution a lot of it just has to do with all the volatility in the FFA market, which I do believe is going to calm down.

And I do think opportunities will present themselves again. So a little bit of a pause, I would say going into year-end paying down the debt, that's the top priority is to pay down to the 2.46.

And then we'll – we'll assess what the next move is.

Thanks, John makes sense. And then just finally the – just to confirm those final two Ultras coming in January, those are going to be funded fully with cash.

Correct.

Okay. Thank you.

I'll turn it over.

Thanks, Omar.

Hey, good morning. Just a couple of questions here.

Following up on the dividend strategy mention the sustainability of the strategy going forward. You fixed seven vessels, some time charters that's about 85% of the fleet.

Do you have any targeted level going forward? I know rates have been all over the place here but just curious to see your thoughts there to improve the visibility of earnings going forward with time charters?

Yes. So we don't have a target percentage at this point Magnus, but I do see us taking as the market allows more of the Capesize exposure off the table to de-risk.

I don't see us doing the entire fleet, and I also – we're pretty happy with those – the two-year charters that we've done so far that have been above 30. It's much more of an opportunistic approach to it when we see something that that makes sense.

When we're able to do those charters, those are at, we've done a few thousand dollars above where the F – what the FFA curve would have shown for that period of charter. So we looked at that as a very good trade.

So there's quite a few things we look at, I think in general we do want to provide more visibility, but we also want to make sure we're doing the right transaction.

And with volatility in the market, have you seen – what's the appetite from yours to go along. I'm sure they won't go along at a lower rate, but spot rates have come down.

So I was just curious to see if it's easier to do time charters when spot rates are lower than when you have this recent spike in spot rates?

I think it has more to do with the FFA market. And there's – again, there's been so much volatility in that right now.

We haven't seen much done over the last week, but again, as that calms down, which I think we're seeing, I believe we're seeing the beginnings of that. You'll see more one, two-year deals being done.

To answer your question, yes, I am sure that that cargo owners are looking at the same demand and supply fundamentals as we are going into the – going into next year and if they can take advantage of an attractive opportunity on their side, an owner that wants to fix in this kind of market, they will. There's no doubt which I think is really important.

There's so much more liquidity in the time charter market, the period market this year, I opposed to what we were seeing in 2020. So I look at that as very positive in general, and I think that'll continue in the next year.

All right. Thank you.

And just one last question, maybe for Pete here. Everybody's focused on the iron ore market, but the coal market's been surprisingly strong.

I guess, the big focus here is China going to step up production domestically, or they going to import. Do you see any signs there that actually imports our increasing over the last few months and then going forward?

Hi, Magnus, thank you for your question. Yes, we actually have seen quite an uptick recently in Chinese coal imports.

Typically, when you look at the last three years, we see quite a drop off this time of year on the coal import side. In China, there's a lot of talk about restrictions normally this time of year importing a basis last year's level.

This year's actually been the opposite. We we've seen quite an uplift in coal imports into China.

There's been low stock piles, increased demand for electricity and also just shortages within the domestic market in terms of production. They've had a difficult time getting coal from Mongolia due to COVID restrictions, and then obviously the Australia to China cold dispute, where there's been more of a diversion of cargo.

So some of it is self-imposed by China. Some of it is market related, but we're certainly seeing an uplift of coal shipments to China over the last few months.

Okay, great. Thank you.

That's it from me.

Thanks, Magnus.

Thank you. Good morning, John.

Good morning, Apostolos. John on the reserve when you're looking a quarter forward, presuming that buybacks and vessel acquisitions are in that reserve mix.

How much flexibility do you have when you're looking a quarter forward?

Well, keep in mind the reserve is really set off of how much debt we want to repay the following quarter. So the real is the debt repayment and then that translates into the reserve.

In terms of how those proceeds are used, there's a lot of flexibility. That's cash that will sit on the balance sheet that as you pointed out can be used for acquisitions.

It could be used for certainly stock payback somewhere, somewhere down the road. If we felt that was the right move.

And it could also be used to smooth out dividends. If we have a lower quarter due to volatility, but we still believe in the fundamentals going forward.

We can smooth that quarter out with the reserve. So a lot of flexibility, there's nothing written in stone in terms of how those money's can be used by the company.

Great. And I think this is a question for Peter, but we were talking about presuming that China steel production remains flatter slightly up.

Rest of the world production is up mid-single digits, which is almost half the world steel production. How does that translate into ton miles in terms of rest of the world carrying the production increase?

Yes. No, it's a good question.

And that's why one of the reasons why we try to highlight that in our prepared remarks is that there's so much focus on China, which deservedly. So it's a huge driver of drive wealth trade, no doubt.

But ex-China on the steel side has been – there's been a huge recovery this year, up 16% of the first nine months of this year. When we talk about ton miles, just look at the other larger steel producers, Japan, India, Europe the U.S., South Korea.

So when we talk about Asian producers of steel the ton miles don't change too much because it's still going Brazil to Japan, possibly, or Australia to Japan instead of China. But the overall sense is that, let's say there is a little bit of a hiccup on the steel side in China that we've seen, although the over year we're essentially flat in terms of overall production, it's more timing.

We're still seeing import flows into the other larger scale producers. So that's one thing to really keep in mind.

Another important part is that Chinese steel production historically peaks in the second quarter of the year during spring construction season. Typically we do see a drop off in steel production in Q3 and Q4.

Not necessarily to this extent, there's other factors at play right now within China, but iron ore exports from Brazil and Australia peak during this time of year, really the sweet spot of September in October. And that really correlates with what, what we've seen on the Capesize side.

So it's just important to understand the difference really between steel production iron ore imports, because the correlation hasn't really been there in recent years.

Great. Well, thank you.

John. Thank you, Peter.

Thanks Liam.

Yes. Thank you and good morning everybody.

John, I think you kind of touched on how you're thinking about a buyback on with Liam's, with some comments to Liam's question. We're kind of curious, clearly asset prices have gone higher, you're generating good cash flow.

And this is something that we've thought and talked about stocks never really went up with that spike in rates, but it seems like they're pulling back with the recent more so with the pullback in rates. As we look at kind of that softness in the market, whether it's – the next couple weeks or maybe a little bit longer, if that continues to weigh on the stock that does a buyback potentially make sense or right now let's get the debt where we can really push the dividend going forward.?

Yes. I would say that the number one goal right now, Greg, is to get the – get that debt to 246 and then use cash to take delivery of the two Ultramaxes in the beginning part of January, which I might add are very much in the money from evaluation standpoint.

I definitely agree with you on the equities. They did not move up.

When Cape rates moved up into the 80's and they seem to be in a little bit of a downward motion with rates overall, I think I'm not sure if it's entirely rates or if it's uncertainty around ever drawn before uncertainty around the power issues in China. But again, we haven't seen – we haven't seen asset values come off.

If anything, they probably strengthened a little bit over the last week. And I don't see them coming off to any extent because the new building price is pretty firm, and there is a correlation between those two.

So I think there's a floor that's set by the new building price. And as we all know, there's even if you wanted to order, you're talking about 2024, so there's demand for new buildings, you've got the price of steel that's remaining firm.

So to me it's a good opportunity for people right now in terms of the discount to steal value. But I'm also hopeful we get into next year, people become more comfortable – or as, as comfortable as we are with the supply and demand dynamics.

Our value strategy will take some a few quarters to season hopefully that will be also very helpful to the valuation and the equity.

Okay, great. And then just, I mean, clearly everybody's picking over the, how you're thinking about the formula for the dividend.

As I think of as or as we think about dry docking realizing it it's not a big number. But is that something that is going to be – is that going to be more on an annual, how should we think about as we try to forecast that expense?

Is that something that we should be thinking about on like a quarterly, annual basis or any guidance fair?

Yes. Greg, this is Apostolos.

We will be giving guidance on a quarterly basis for Q4 we're talking about $2.9 million, and then for all of 2022 we're talking about $27 million. But that includes the upgrade on fuel efficiency side that we're doing, which is really an investment.

In any case we will be giving it to you on a quarter-by-quarter basis. So at the same time that we announce the debt pay down and the reserve and the rest of the costs, that's going to be part of it.

Okay, great. Thanks guys.

Have a great day.

Thanks, Greg.

Yes. Good morning, John.

Good morning, Apostolos. Can you just clarify that last comment, Apostolos.

So if you're looking at $27 million with upgrades, will the upgrades also be included in the dividend calculation?

Yes, they will. So that $27 million is all inclusive.

Again, including $8.6 million of upgrades for 2022.

So $8.6 million is upgrades. And then can you clarify whether the $41 million of cash that you're going to use to complete the acquisitions?

Is that going to be taken out of the dividend in the first quarter? Will that be part of the dividend calculation in the first quarter?

It doesn't get affected; it's completely separate in the sense that it's not operating cash flow. But as you did say, we will be using it.

We'll be using cash from the balance sheet to pay for that?

But again, sorry.

Go ahead, Poe.

No. But again, it's not going to be excluded from the operating cash flow when you look at calculating the net cash, that's available for the dividend.

No. we will not go into the dividend calculation.

So we're paying down the debt to $246 million and then we'll be using cash off the balance sheet in the very early part of January to take delivery of those two ships, but that cash off balance sheet is not going into the dividend formula. The dividend formula on Page 8 is the only number that really needs to be filled in here on Page 8 of the presentation is the net revenue number.

We've given 70% of the fixtures, so the question mark is the 30% which will be market based.

And then can you just clarify the reserve? John does include the corporate purposes and acquisitions.

Can you just talk about how future acquisitions might be handled in the context of the dividend calculation and the reserve?

Acquisitions will not go into the calculation of the dividend. Again, as you're looking on Page 8, these are the buckets, if you will starting at the top with the operating cash flow and then debt repayments for the quarter, the dry docking, the reserve for the quarter.

And again, the reserve is really a factor of the debt repayments. And then that will give you the dividend per share and can't stress enough the ideas to give this at least one quarter in advance.

Great. And then when you talk about debt repayment of, the run rate is 3$5 million a year.

That means that in seven years you're going to be debt free. Does that meet your intermediate term goal of being debt free?

Or would you think that that intermediate would be a little bit shorter timeframe?

It uses $35 million targeted run rate and I'm using that term specifically, because we will look at this on a quarter-by-quarter basis, but again if you use the reserve, you can see getting into 2022 with $35 million of debt repayment. If you do two years at $35 million, I think you're pretty close to net debt zero with the reserve build up and the debt amortization.

So by the end of 2023, we would actually be in a net debt zero, and then obviously the longer term goal is to get to zero overall.

Okay. And then, can you just talk about your time charter strategy on the capes.

I guess in previous conversations you've always viewed the, or it seems like you viewed the capes as adding upside volatility and upside potential. And I think that you're saying that maybe you're going to lock in time charters to reduce the cape volatility.

Can you just help me understand sort of your strategy on the cape side?

Yes. Again, it's opportunistic Poe.

I mean, the capes as you pointed out are volatile, but if you can – if you can put into place a good two-year fixture or three-year fixture for that matter basis, return on capital we'll take advantage of those opportunities. But it's not just as simple as waking up in the morning and saying, well the markets at $30,000 a day, let's fix.

We look at what the FFA curve is indicating and we create better value over that? Or we have hurdle rates in terms of what we think the rates should be on a time charter basis.

And we also look at the valuation of our fleet and sort of what cash-on-cash returns we're able to put in place. So it's a combination of factors.

I think de-risking some of the Capesize fleet from time-to-time makes a lot of sense because of the volatility and quite frankly, going into the first quarter, we've got 20% of the Capesize fleet, 6,000 to 28,500. So obviously that is – that's a very good number as we look at the paper market right now.

So it's a combination of factors overall we do want to take opportunities as they present themselves to lock away some of the Capesize tonnage. We may do it in a minor bulks, but I would say less on the minor bulk side, more on the cape because of the inherent volatility.

Great. Thanks.

That's helpful.

Thank you, Poe.