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Fast growing Star Bulk sinks into the red in 2014

Fast growing Star Bulk sinks into the red in 2014
Highly acquisitive US-listed Star Bulk Carriers sank into the red in 2014 with $11.72m loss in 2014 and is selling older vessels and delaying deliveries.

Against a backdrop of a weakening dry bulk market Star Bulk reported a net loss of $11.72m last year compared to a profit of $1.85m a year earlier. Revenues jumped to $147.39m last year compared to $69.89m in 2013 as the company’s fleet grew rapidly due to mergers and acquisitions.

Star Bulk has grown rapidly over the last year taking over Oceanbulk and the fleet of Excel Maritime Carriers and will have a fleet of 98 bulkers once all the existing vessels and newbuildings are delivered into its fleet. Currently Star Bulk has a fleet of 66 vessels with a further 32 ships to be delivered through to September 2016.

According to Star Bulk ceo Petro Pappas the shipowner is looking to sell-off more elderly vessels from its fleet and has agreed to delay delivery of some newbuildings.

“Regarding our ships, we have disposed of five older 90’s built panamax and handymax vessels and there will be further disposals of vessels that do not fit the profile of our fleet. Importantly, we have agreed to defer certain pre - delivery installments for newbuilding vessels from 2015 to 2016, as well as to delay vessel deliveries,” Pappas said. How many vessels have were involved was not revealed.

While the dry bulk market remains highly depressed with the Baltic Dry Index sinking to an all time low in February Star Bulk is optimistic about the long term outlook.

“We remain optimistic regarding the fundamental long-term dynamics of the dry bulk industry. Although 2015 will be challenging, we expect a significant correction in the supply of vessels which combined with continued strong demand for commodities will create the necessary conditions for a healthier market in the future,” Pappas said.