Thank you for standing by, ladies and gentlemen. Welcome to the Safe Bulkers Conference Call to discuss the First Quarter 2021 Financial Results. Today, we have with us from Safe Bulkers Chairman and Chief Executive Officer, Mr. Polys Hajioannou; President, Dr. Loukas Barmparis; Chief Financial Officer, Mr. Konstantinos Adamopoulos.

[Operator Instructions] Following this conference call, if you need any further information on the conference call or on the presentation, please contact Capital Link at 212-661-7566. I must advise you this conference is being recorded today, May 6, 2021.

Before we begin, please note that this presentation 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.

The company’s growth strategy and measures to implement that strategy, including expected vessel acquisitions and entering into further time charters. 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.

Although the company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct.

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, changes in the demand for drybulk vessels, competitive factors in the market in which the company operates, risks associated with operations outside the United States and other factors listed from time to time in the company’s filings with the Securities and Exchange Commission.

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 or any change in events, conditions or circumstances on which any statement is based. And now, I pass the floor to Dr.

Barmparis. Please go ahead, sir..

Good morning. I am Loukas Barmparis, President of Safe Bulkers. Welcome to our conference call and webcast to discuss the financial results for the first quarter of 2021. Let me start our presentation by expressing our gratitude to all our seafarers. We are committed to their safety and well-being.

Moving on to Slide 3, we present some key points about Safe Bulkers. We are a true drybulk player. Without predications, we have a history of 60 plus years of uninterrupted presence in the drybulk market. Our management team has more than 30 years of experience in the drybulk industry. We are here for the long run.

We preserve our liquidity, which provides financial flexibility, security in turbulence and opportunistic asset acquisitions. Our spot market exposure allows expansion of profits in favorable charter market conditions. We have half of our fleet in the spot market at about one-thirds of BDI charters index-linked, enjoying the credit market position.

About 75% of our fleet is Japanese built, providing us with a lower environmental footprint, lean operations and cost building advantages from scrubber-fitted vessels based on increased fuel spread differential.

We have actively centered the environmental preservation in the heart of our competitive strategy by investing more than $67 million in 2019 and 2020 retrofitting 50% of our fleet with exhaust gas cleaning devices, also known as scrubbers, which provide us with extra income capability in rising oil price environment.

Management team has seen in the gain that offers full alignment with shareholders. We have demonstrated our twofold fleet renewal strategy.

On the one hand, looking towards 2030 with ordering greenhouse gas EEDI Phase 3 and NOx-Tier 3 Japanese newbuilds and on the other hand, capturing the present market by opportunistic second-hand acquisition, replacing older vessels at a modest price differential. At the same time, we continue the gradual de-levering of the company.

I will continue with Slide 4. We focus on our spot market exposure. I would like to point out that 75% of our fleet is Japanese versus 46% of the world fleet, providing us with a lower environmental footprint, lean operations and cost building advantage.

With reason on the left side, the Cape and Kamsarmax spot market during the first quarter of 2021 has significantly improved.

As a result of our exposure in the spot market, without – with half of our fleet on the – and the fact that about one-third of our period charters are index-linked you can observe on the right-hand side figures, the impact on our PC and net revenues of this quarter versus the same period of 2020. We continue the presentation of 70 points on Slide 5.

We demonstrate our lean operations and low breakeven points with stable operating expenses yet again during this quarter. As a result, on Slide 6, we have increased our profitability to earnings per share of $0.18 and $0.14 on an adjusted basis as compared to an adjusted loss of $0.13 for the same quarter last year.

Our liquidity has also increased in Slide 7 to over $190 million as of quarter end and over $209 million as of April 23, which increases our flexibility to execute on our fleet renewal strategy and de-leveraging. At the same time, we have a strong balance sheet, as analyzed on Slide 8 with healthy total liabilities to total asset ratio of about 57%.

Now, let’s see an overview of the first quarter as presented in Slide #9. We have increased our profitability in that and with our exposure with half of our fleet in the spot market and about one-thirds about period charters enjoying index-linked rates.

As an example, our recently early delivered Capesize has been subsequently fixed for 1 year at a gross daily charter rate linked to the 5TC bulk exchange Capesize index multiplied by 119%. The current BCI rate stands at 44,000. At the same time, we have increased our liquidity and strengthen our balance sheet.

We will continue our efforts to gradually renew our fleet to selective sales of older vessels and new acquisitions with modern designed vessels that adhere to new environmental regulations.

We remain focused on our environmental performance and continue to invest to improve our operations in this area as we believe that our environmental investments will contribute to sustain operational and financial advantages. Let’s move now to Slide 11 and the industry update.

Most of the countries have accelerated COVID-19 vaccination and have resumed their economic activity, and in most cases, at a faster pace than a pre-COVID period. This year started with very strong charter market. The average charter hire footage is about 20,500 year-to-date as compared to 5,400 for the same period in 2020.

Presently, Capes are trading at about $45,000 per day. Similarly, for Kamsarmax, the average charter hire is $19,300 year-to-date as compared to $7,100 for the same period in 2020. Presently, Kamsarmax are trading at about $25,000 per day.

This represents a substantial increase in the vessel’s revenue, which has been sustained through the first 5 months of 2021. Looking on vertical Capes, which have been extremely legal and relevant to the market trend that forecasted is for the market to remain strong.

According to the present trading rate for Capesizes, June is expected to trade at $47,000, Q3 and Q4 at $36,000 and $39,000 respectively. Similarly for Kamsarmax, June is expected to trade at $28,000 per day, while Q3 and Q4 is at $25,500 and $22,000 per day, respectively.

The expected sustainability of the market Capsize as a result of the increase in the underlying demand, which is also reflected in the commodity prices, which we will review in a moment and the lack of other supplies. In Slide 12, we present the current status of the major relevant commodity prices.

As seen, there has been a huge price surge on all commodities relevant to shipping. Main reason for this was the strong demand from China and from other countries and the government spending on post-pandemic recovery programs as well as the greening projects of the global economy.

Indicatively, iron ore, which is the main curve which is trading at about $190 per ton comparable to 2009 levels. Similarly for steel rebar, which is a direct product of iron ore and reflects the subsequent metal production is currently trading at the highest levels in 5 years.

Soybeans weaker among the major targets for Kamsarmax have hit an 8-year high and similar pattern supply on all grain products such as wheat, corn, et cetera. In addition, we also presented the price development of copper, which as stated above, $10,000 for the first time since 2011.

The surge in demand for commodities has been further enhanced by governments in stimulus plans. President Biden has proposed two additional stimulus plans on top of the one he has already passed. Furthermore, it’s important to note that the demand is not only driven by China, which was the case through the [indiscernible].

The rest of the world is picking up and many countries are real contributors to the demand side. Turning to Slide 13, we present the status of the fleet for Capes and Panamaxes. On the top left graph, we present the price of a 5-year old Capes and Panamaxes since 2010 as assessed by both exchange.

The 5-year old Capes have set by about 30% since the last 6 months and about 90% since 2016 lows. And presently, are valued at about $4,000 million. Similarly, Panamaxes have surged up by about 35% during the last 6 months and about 105% since the 2016 lows.

It is important to note that above figures reflect the other vessel in terms of country and their shipyard bill. Specifications and maintenance divisions, Safe Bulkers has mostly built by top class shipyards in Japan at advanced specification. Moreover, 75% of the fleet is associated with pilot water treatment system and have revisable scrubbers.

All these features are providing significant additional market values for each of our vessels. In the second – in third graph, we present the status of the order. Until the end of the year, the newbuild orders accounted for about 2.5% of Capes and about 3.7% for Panamax. From 2022 onwards, the new orders are less than 2%.

It is important to note that there are several limitations for anticipating asset in newbuild orders. There is a scarce building capacity at most shipyards as most shipyards have product base slots by building other sectors assets such as containers and tankers. In addition, only few cities have developed new environmental efficient designs.

These reasons taking into account the aging of the fleet and the eventual scrapping will diminish in the growth of the drybulk fleet.

On the next Slide #14, we will present the status of the bunkers prices, and more specifically, the difference between the price of very low sulfur fuel oil and the high sulfur fuel oil, the so-called Hi5, which is of interest for our scrubber operations.

Also in the top graph, the Brent prices collapsed during the pandemic period, especially in the beginning of 2020. As it was expected, this affected also the bunker prices and especially, the different products and yet, the very low sulfur fuel oil. Presently, Brent rates close to the pre-pandemic levels in a healthy level of about $70 per barrel.

Hi5 is presently in the region of $110 per metric ton, and according to the future market in Singapore, it is expected to trade in the region of $120 for the remainder of 2021 and in the region of $130 of 2022 and 2023. Safe Bulkers has installed scrubbers on half of its fleet.

For reference scrubbers post-Panamax with consumption of about 7,500 metric tons per year, they enjoy the benefit of about $120, which is the difference between the very low sulfur fuel oil and in the heavy sulfur fuel oil, making about $900,000 per year or about $2,500 per day.

The recovery of global economies, installation of mobility and recovery of crude oil prices may push the Hi5 differential even higher to pre-COVID-19 levels. Let me summarize the key market takeaway in Slide 15. The order book is minimal at its lowest level since 2002 as decarbonization discussions not favor new orders.

Most shipyards are preoccupied with containers and tankers orders until 2024, and only few shipyards have developed new environmental efficiency designs. We have experienced an exceptionally strong start of 2021 with robust volumes of iron ore, coal and grain in trade. Demand for commodities has been exceptionally strong during the first quarter.

We have seen increased governance spending on post-pandemic stimulus programs and continuing greening of global economy.

We have experienced Brent prices recovery, which may even acquire the Hi5 spread differential than that of today of about 120 tons and lastly, the aging of the fleet and the increased environmental restrictions for emissions to enhance the scrubbing activity.

Now, let me pass the floor to our CFO, Konstantinos Adamopoulos, for our financial overview..

Thank you, Loukas and good morning to everyone. Let me start in Slide 17. We are chartering performance, where we present our quarterly time charter equivalent rate. For the first quarter, we stood at 15,567 vessels. Revenues, our quarterly running expenses would stood at $4,702.

Moving on to Slide 18 which represent our quarterly daily OpEx and our daily – quarterly daily G&A, which stood at $1,440. The added figure for both OpEx and G&A for Q1 2021 was $6,142, demonstrating our focus on lean operations. We believe that this number when comparing apples-to-apples is one of the industry’s lower.

If not the lowest, given the fact that we include in our OpEx, all are dry dockings and free delivery expenses. And in our DNA, our management fees, our directors and officer’s compensation as well as all expenses related to the administration of our company.

Moving on to flip debt profile, as seen in Slide 19, we represent a repayment schedule as of March 31, 2021.

As of that time, our liquidity stood at $191.4 million, consisting of cash and bank time deposits, restricted cash contracted undrawn borrowing capacity under revolving credit facilities and secured commitments, including sale and leaseback financing. Slide 20, we focus on our liquidity versus our CapEx.

As of April 23, 2021, we have liquidity of $209.6 million, which included cash and cash equivalents, time deposits, restricted cash and funds available under the sale and leaseback agreements, new term loan agreement as well as the revolving credit facility.

Our aggregate remaining CapEx for the acquisition of our 2 newbuilds and the merger were $52 million, of which a $600,000 is payable this year and $51.4 million payables in 2022.

In addition, the committed CapEx for the scrubber for the installation of one scrubber and several ballast order dividend systems were $3.2 million, of which $2.3 million is due this year and $900,000 next year. Slide 21, we present our debt amortization schedule versus the scrap value of our fleet.

We have a smooth debt repayment profile for the next 2 years, so helping us gradually de-leverage our company. Next, Slide #22, we present our quarterly financial highlights for the first quarter of 2021 compared to the same period of 2020.

As a general note, during the first quarter of 2021, we operated in an improved charter market environment, higher charter rates compared to the fourth quarter of 2020, with lower interest expenses while our revenues were supported by the earnings from scrubber-fitted vessels and reduced volume expenses.

During the first quarter of 2021, we had a time charter equivalent of $16,567 compared to a TCE of $9,089 within the same period in 2020. Net income for the first quarter of 2021 reached $21.3 million compared to a net loss of $9.9 million during the same period in 2020.

Net revenues increased by 37% to $62.5 million for the first quarter in 2021, compared to $45.7 million for the same period in 2020, mainly due to increased TCE, as a result of the improved market, assisted also by the additional revenues and by our scrubber-fitted vessels.

Daily vessel OpEx decreased by 1% to $4,702 compared to $4,771 for the same period in 2020. This decrease is associated with reduced dry dockings and provision of technical services, which was impacted with increased crew repatriation expenses due to COVID-related issues.

Daily vessel OpEx, excluding dry docking and pre-delivery expenses increased by 2% to $4,358 for the third quarter of 2021 compared to $4,258 for the same period in 2020. Our adjusted EBITDA for the first quarter of 2021 increased to $34.6 million compared to $9.4 million for the same period in 2020.

Our adjusted EPS for the first quarter in 2021 was $0.14. Calculated on a weighted average number of 103.3 million shares compared to a loss per share of $0.13 during the same period in 2020 calculated on a weighted average number of 103.4 million shares.

Slide 23, we provide an estimation of the expected downtime in days for this year in order to assist our analysts with their projections. Closing our presentation in Slide 24, we present our quarterly slide data and average daily indicators compared to the same period last year.

We would like to emphasize that the company is maintaining a strong liquidity position with $209.6 million as of April 23, 2021.

This decreased liquidity provides us with flexibility to follow our plan, aiming to gradually renew our fleet with the fewer forthcoming environmental changes and sensibly de-leveraged our balance sheet targeting to create value for our shareholders.

Once again, I would like to thank our seafarers for their commitments and dedication throughout this tough period. Our press release presents in more detail of our results and we are now open to take questions..

Thank you. [Operator Instructions] We will now take the first question. Please go ahead. Your line is open..

Hi, this is Liam on for Chris Wetherbee. Thank you for taking my question. So I just wanted to first ask about your fleet and the chartering strategy. So I know that half of your fleet is on the spot market environment..

Can you please speak closer to the microphone because you cannot – you don’t have good reception or....

Yes, sorry about that. So I know that half of your fleet is on the spot market currently. So I just wanted to ask about your chartering strategy.

So what are your thoughts about the portion of your vessels that will continue to trade in the spot market? And what would it take for you to kind of look to lock in some of your vessels on longer term charters?.

Yes. Right now, half of the vessels are in the spot market, and the other half on short-term period market up to 1 year. Out of this period, shifts one-third of them as we saw is index-linked because we have – we were feeling that the market will improve in 2021.

And we decided those fixtures on part of the clear pictures will be done on an index-linked basis. So we will continue for the rest of the quarter and up to the third quarter this policy to keep ships in the spot market.

And possibly, in the third quarter or the fourth quarter, we will try to lock in longer periods as the charterers will be more keen to secure longer period charters..

Got it. That’s very helpful. Thank you. And so kind of there is a little bit of a follow-up to that and some of the things you discussed earlier. So I know that more recently, given the fact that spot rates have surged, that’s really benefited your liquidity.

But I’m also just kind of wondering like how are you kind of planning to leverage that increased liquidity? Are you going to look to be more aggressive in pursuing your fleet renewal program and maybe acquire more vessels in the secondhand market?.

Yes. I think that now our aim is joined – exercise of the leverage and fleet renewal. We are interested into newer technology vessels which means we have to concentrate on acquisitions on ships younger than 5 years old. At the same time, we have some ships approaching 18 years old, that we need to sell.

So there will be some sales and some acquisitions and some selective ordering at a very limited pace. Because right now, we see that the shipyards are not ready to propose new designs with new technology, and there are not so many options there. This of course is giving us more optimism for the freight market.

In that, we don’t expect to see newbuilding orders – many drybulk newbuilding orders for 2023. We believe that the yards are getting filled up with big container ships and tanker orders, whilst drybulk orders the owners will be waiting for new designs to appear, but we don’t see many shipyards keen at the moment to develop these new designs..

Alright. Thank you very much for taking my questions..

Thank you. And we will now take our next question. Please go ahead. Your line is open..

Great. Thanks. This is Ben Nolan from Stifel. Actually, just wanted to follow-up on that last response you’re talking about. Well, obviously, you guys ordered some ships last year, but now we’re sort of looking for things with new designs. I’m curious if you could maybe flesh that out a little bit.

Are you most interested, I don’t know, and things that maybe would use ammonia or is there something specific that you have in mind that isn’t being developed that would be of interest?.

Yes. Look, when we speak about newbuildings for the future, and we said that we have bought the two ships, and we referred to Phase – EEDI Phase 3, I wanted to clarify that EEDI Phase 3 comes in the regulations after 2025.

So basically, what the company has done is that we order, not the present generation that we can do easily, which is Phase 2 until 2025. But we offer the Phase 3 vessels, which are much closer to 2030, and they are more advanced. Now the company has chosen this route because we believe it’s a pragmatic group for the existing technologies.

And we know that despite the fact that there are several discussions and researches about new fuels, we are not – we are quite sure and we know that new fuels like hydrogen or ammonia will not come to play a role in the – in, let’s say, the next decade.

So by having the most advanced ships of 2025 onwards earlier, that would be a competitive advantage.

A second point that we want to stress out is that our company has – and we said that many times that we want to clarify that our company has the vast majority in Japanese big fleet, which generally are lighter and more energy-efficient, and as a result, we have better footprint.

So we expect that when the new regulations of greenhouse gas has come to 1 of January 2023 as it is expected to play a role in the performance in the valuation – in the classification of the vessels in categories A to E and the A categories – the A category vessels will receive a notice that between a year, they need to fix second fleet, so if the D category within 3 years.

I mean our vessels will be well placed in this lease. And so we will maintain the operational advantages that we always have had in the past. I don’t know if you want to ask another question on that..

Yes. Well, really, the question is and I appreciate that you are in a good position in that your newbuilds that you have ordered are also in a good position. But when looking at sort of what would be next, if you were to order ship, and – but yes, it isn’t available to shipyard.

What do you have in mind there? I mean what is that next-generation ship that would – if a yard were to come out with the design, what would check the boxes for you? Is there a particular type of fuel or something?.

This is a problem right now. There is no next-generation ship available. A lot of stories appearing in the press about what will be the fuel for the next 10 years or 20 years, no one knows.

Definitely, on tankers, on containers, there are a few options being proposed by the shipyards, which really, we don’t need to know which is the medium-term or the long-term or the short-term. For ourselves, we cannot do anything more at this stage than go for Phase 3 newbuilding whenever it’s available.

Otherwise, we will concentrate on very more than second-hand ships, but under 5 years old. That will be very close to – on the upper part of Phase 2 designs. There is nothing we can do at the moment because really no one knows if this ship will be LNG powered, if it will be hydrogen, if it will be ammonia. No one has an idea.

And the yards – and this is maybe a good point for trade markets. The yards, they are not really interested to develop such designs for bulkers. So at the moment, they concentrate on big container ships that they have big consumptions or VLCCs or bigger ships.

And they don’t bother yet to develop designs for bulkers for the next phase of decarbonization. Basically, you have to remember that the yards like ship owners. They have been losing money for a number of years. And first of all, they have to do the change on the bigger ships.

They have better levels and new contract levels, and thereafter, they will bother. So I think it will be very difficult to have new buildings with new designs for bulkers proposed by the yards this year. If at all we get it, it will be next year at the earliest.

So the delivery of bulkers with different fuels, all these things should not be available before 2025 delivery. So we have to be patient. If we can find reasonable price with good delivery date newbuild of Phase 3, we may consider. If we don’t find, we will go for very young ships in replacement of our older ships..

Okay..

If we consider that the only alternatives not purely to the existing fuel, which is the natural gas, for example, the LNG and we don’t have such solutions in this – in the bunker industry. Such solutions may come, let’s say, towards the end of this decade.

And maybe new fuels like hydrogen or like ammonia would come at the early or need of the next case. So basically, the next-generation ships that are not generally available now at Phase 3 vessels. So this is the only thing that we have, and which is pragmatic..

Yes, I appreciate that. If I can switch gears for a second, my next question, obviously, we’ve seen spot rates go up and you talked about that. And there is strong underlying demand you guys did do some time charters. But still most things, both for you and elsewhere in the market, tend to be pretty short duration, 6 to maybe 18 months on the long end.

But as the market tightens, are you guys beginning to see any lengthening duration in terms of what customers are looking for to sort of perhaps hedge out the risk of a spike or something like that? And really, I asked because I know in the past, you guys have done some longer duration deals.

So is that something that’s materializing at all? And is it something that you would be interested in doing?.

You are talking about the longer period of charter, do you?.

Yes. 3 years or 4, I think longer than a year, yes..

Yes. For this to happen, we have to be a little bit patient because we had a decent two months, February and April. In between, we have the correction of the market in March. So all we have seen until now was just two good months of freight market, February and April. And we continue now in May is the third month of a good freight market.

The charters before there is some fixing long-term deals, they have to see the spillover of enthusiasms going on in the forward years. And many of them usually monitor this FFA market, which is not necessarily every ship owners’ piece of cake or guidance for long-term business, but the charter is mainly they monitor these things.

And as we know, the forward part of those scales is very depressed from the point of view that there is not enough volume to push it up to the proper levels, similar levels like 2022 when 2021, when we know 2022 is supply restrictive and the same for 2023.

So as we enter into Q3 and Q4, I believe charter will get this feeling, but the commodity prices of today’s and the value of the dollar and what is happening worldwide with stimulus package, both East and West, we will keep them – the market this time higher for a longer period of time.

And then we will see the FFA for years, start moving to higher levels. And then charters will start asking ships for 3 or 4 or 5 years.

So we have to be patient and have the ships in the spot market to be able to reach that point when charterers will decide that, yes, they believe in this market and they start investing into the forward part of the FFA care. So I think this will happen sometime in the third quarter, personally. But maybe you will call me optimist – optimistic.

Maybe it happens in Q4, I don’t know, but I mean, a lot depends on those two quarters, if we will see the long period charters.

Personally, I believe that because ship owners do not participate in the FFA market, especially for the forward years, I believe that the FFA market is rather constrained and is the freight is being exchanged for the forward years between charters and operators, which mostly sit on the same side of the fence usually..

And if that does materialize, that is an area that you guys would need to be active in..

If it doesn’t materialize, we have to enjoy the $20,000 a day..

Right now but I think if it does – if it happens?.

If it does, certain part of the fleet has to go there, yes, definitely..

Yes. Okay, perfect. Appreciate it. Thank you..

Thank you. And we will now take the next question. Please go ahead. Your line is now open..

Gentleman, it’s Randy Giveans with Jefferies.

How is it going?.

Yes. Hi, good morning..

Good morning. Two questions from me.

First, clearly, your TCE rates increased pretty meaningfully from $12,000 a day in the fourth quarter of 2020 to about $16,000 in 1Q ‘21, so how big of an increase are you expecting in 2Q ‘21?.

Look, I mean the spot market has moved to the leverage, $22,000, $23,000 a day. On the Capes, it has moved on to $40,000 level. So you should expect that the second quarter TCE rate should be a similar increase. We already run 50% of the second quarter and the fixtures you are doing now will cover the rest of the second quarter.

So I mean, the assumptions are easily to be made. So I do not want to predict the numbers now, but it’s – I mean you are 50% in the spot market and one-third of the period of ships. On index-linked, you can run the calculations very easily..

Okay. And then it looks like you used half of your $23.5 million ATM program raising I think it was $12.7 million in recent months. Average price is under $2.80 million.

So with the ongoing rally now pushing your shares around 4, will you use the remainder of that ATM here in the near-term and what will the primary use of the proceeds be?.

Look, a small part of ATM has remained, but we don’t know exactly when we will activate this last part. I mean we always activated when the company as before have already indicated when the company thinks that it’s right pricing. And so we cannot comment on that anymore..

Alright. Well, thanks so much. That’s it for me..

Thank you. [Operator Instructions] There were no further questions coming through, so I’ll now hand back to the speakers..

So thank you for attending this Q1 conference call and the webcast to discuss our financial results, and we are looking forward to have the same discussion in about 3 months from now. Thank you to all and have a nice day..

Thank you. That does conclude the conference for today. Thank you for participating. You may now disconnect..