During the third quarter of 2014, Star Bulk Carriers Corp.’s (SBLK) management fee income stood at $0.3 million compared to $0.5 million for the third quarter of 2013. This was due mainly to the decrease in the average number of third- and related-party vessels under management to 4.9 vessels in the quarter from 6.6 vessels in the year-ago quarter. As a result of Star Bulk’s acquisition of Ocean Bulk and the Pappas Companies, 11 vessels under management that were part of these acquired fleets became part of the Star Bulk fleet as of July 11, 2014. As a result, Star Bulk stopped receiving fees for the management of these vessels.
Operating and net income
For the third quarter of 2014, Star Bulk’s operating income stood at $1.3 million compared to $1.8 million for the third quarter of 2013. Net income for the third quarter of 2014 stood at $0.2 million, or $0.003 earnings per basic and diluted share, compared to a net loss of $0.2 million, or $0.01 loss per basic and diluted share, for the third quarter of 2013.
Excluding the noncash items and acquisition‐related expenses of $7.0 million for the Ocean Bulk and Pappas Companies acquisitions, Star Bulk’s net loss for the third quarter of 2014 would have been $2.2 million, or $0.03 loss per basic and diluted share, compared to $2.3 million net income, or $0.13 per basic and diluted share.
Adjusted earnings before interest, taxes, depreciation, and amortization (or EBITDA) for the third quarter of 2014 stood at $9.7 million compared to $7.8 million in the third quarter of 2013. Gain from bargain purchase during the quarter supported the growth in EBITDA.
EBITDA growth for Star Bulk’s industry (SEA) peers such as Diana Shipping Inc. (DSX), Knightsbridge Shipping Ltd (VLCCF), and Navios Maritime Holdings (NM) stood at (2.65%), (75.7%) and 38.8%, respectively.
Star Bulk management stated that commodity demand remains healthy, while substantial supply expansion has resulted in surpluses across various commodity markets.
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