United Maritime Corp. Q4 FY2023 earnings call

• Transitioned to a dry bulk company after selling tanker vessels. - Acquired seven dry bulk ships with $144 million organically, avoiding equity dilution. - Declared approximately $10.7 million or $1.38 per share in cash dividends since November 2022, including $0.75 for Q4 2023. - Repurchased 84,813 common shares since Q4 2023 at an average price of $2.4 per share. - Acquired a high-quality Kamsarmax dry bulk vessel via an 18-month bare boat charter with a purchase option. - Vessels operate on index-linked time charters. - Hedged about half of ownership days in Q1 2024 at an average rate of $14,300. - Refinanced three capes with a Chinese lessor, enhancing liquidity.

In the fourth quarter of 2023, net revenue was $11.6 million based on a time-shared equivalent of 15,900. For the full year 2023, net revenue reached $36.1 million, adjusted EBITDA was $18.9 million, and net income was $0.2 million. The fleet book value increased to $153 million from $50 million at the end of the previous year. The fourth quarter marked the company's first period operating purely as a dry bulk company after selling its last tanker vessel in the third quarter of 2023. The bulk value of the fleet increased threefold with $144 million invested to acquire seven ships organically.

• Expect profitability to improve in coming quarters with full deployment of dry bulk fleet. - Fixed half of ownership days in Q1 2024 to hedge, expecting total net time charter equivalent of about $14,200 for fleet. - Dry bulk market strong in Q4 2023 and Q1 2024 due to healthy commodity demand and limited fleet supply. - Net dry bulk fleet growth expected lower than 2% per year in next two years, providing positive backdrop for market.

• Seasonal weakness in dry bulk market in Q1. - Red Sea tensions introducing inefficiencies in world trading fleet. - Low freight rates in dry bulk space in first nine months of 2023 impacting profitability.

Q: Is the bareboat charter being finalized with the Japanese counterparty the second in the fleet?

A: The one just announced is the third.

Q: What makes you decide to exercise the purchase option on bareboat charters?

A: For us, it's expected to exercise the purchase option as it's more like an obligation.

Q: About G&A in the quarter, is the run rate going forward?

A: Targeting $2.5 to $3 million run rate, with some non-CAS expenses in first quarters due to equity incentive plan.

Q: Do warrants adjust with regular dividends?

A: Warrants do not adjust with regular dividends, outstanding around $6.9 million.

Q: Freight strategy for after Q2?

A: Expect to fix rates at substantially higher levels in Q2 and beyond.

Q: Timeline for new drybulk ship orders?

A: Cape sizes delivery well into 2027, Cams/Marxis maybe 2026 but with minimal opportunities.