Thank you for standing by, ladies and gentlemen and welcome to the Safe Bulkers conference call to discuss the third quarter 2020 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; and Chief Operating Officer, Mr. Ioannis Foteinos. [Operator Instructions]. Following this conference call or you need any further information on the conference call or on the presentation, please contact Capital Link on 212-661-7566. And I advise you the conference is being recorded today.

I will now read the forward-looking statement.

Before we begin, please note that this presentation contains forward-looking statements as defined by Section 27A of the Securities Act 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 such 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 of drybulk vessel, 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 therein 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.

I would now like to pass the floor to Dr. Barmparis. Please go ahead, sir..

Good morning, I'm Loukas Barmparis, President of Safe Bulkers. Welcome to our conference call and webcast to discuss the financial results for the third quarter of 2020.

Before I start the presentation, I would like to express our gratitude to all our seafarers hoping that within 2021, we will reach a point that all efforts of the global community to produce treatments and vaccines will conclude and the pandemic will be controlled.

There has been a negative effect from the COVID-19 pandemic on the company's results of operations and financial condition year-to-date due to lower demand, which resulted in a relatively lower charter rates as well as higher crew and related costs. We are happy to return to profitable operations in the last quarter.

In parallel, the company is maintaining strong liquidity position that provides us with flexibility and following a plan, which in the first place, is based on our high-quality Japanese fleet, 32 out of 42, with a big advantage over the environmental footprint compared to the global dry bulk fleet.

And further is aiming to gradually renew and deleverage our fleet, targeting to be the leading quality dry bulk company and create value for our shareholders. Management alignment due to shareholding stake and performance and trust built over the years are of paramount importance in the success of this plan. Let's move to Slide 4.

We present this year the performance of the Capes and Kamsarmax charter market for 2019 and year-to-date, as published by the Baltic exchange. The COVID effect has been the major drive in both sizes. During the first wave of Q1, the chartering market traded at very low levels.

But after Q1, and the resumption of economic activities, we added a 30 volumes of iron ore, coal and grain, especially on Capes, the market picked twice, reaching the levels of USD 35,000. On Kamsarmax, the market has been trading higher than $10,000 since May, and peaked during the summer months, exceeding $15,000 per day.

Looking forward, we are modeling closely the trade tensions developed between China and Australia, and we remain cautious on how a second wave of COVID may negatively affect the trade. However, recent COVID vaccine announcements brought optimism in the global markets.

Turning to Slide 5, we provide more input in relation to the Chinese economic recovery, which remains a driving force of drybulk. As shown in the graph, after a significant contraction in Q1 by almost 7%, the Chinese GDP has grown for 2 consecutive quarters.

According to National Bureau of Statistics of China, the Chinese GDP grew by 3.2% in Q2 and by 4.9% in Q3, a stable recovery after controlling the pandemic. The resumption of trading activity is evidenced by the Chinese imports. There has been a substantial drop on imports during April and May.

A gradual recovery of the Chinese economy during the summer months in combination with the muted trading activity of Q1 led to an aggressive import spree resulting to a year-on-year increase of 13.2% in September and 4.7% in October. Turning to Slide 6. We give more color on Chinese import development.

September's iron ore imports increased by 8.2% month-on-month, 9.3% year-on-year, which, for the period January to September, there was an actual increase of 10.6%. For thermal coal and lignite, imports have dropped by 9.6% in September month-on-month and 16.3% year-on-year. However, the total increase from January to September starts at 18.4%.

This mixed outlook can be attributed firstly to seasonality; and secondly, to the ongoing tension into the China-Australia trading relations. The lower graph represents the Chinese imports of soya beans.

The September soya bean imports increased by 1.9% month-on-month and by 19.4% year-on-year, whilst the imports from January to September imports increased by 15.4% as compared to the same period in 2019. Going to Slide 7, we present the current status of the order book in the 2 charters where we operate, the Capes and the Panamax-PostPanamax.

It is the first time after many years that the order book is so minimal. The contracted orders for Capes amount for 4.6% of the total Capes fleet. And from 2022 and onwards, the orders are minimal. Similarly, for Panamax-PostPanamax, orders for 2021 represents growth of the fleet of about 3.4%, and going forward, less than 1%.

The aging of the fleet, the increase in environmental capital expenditure requirements for complying, for example, with ballast water treatment system regulations may enhance scrapping activity, especially in the environment of low freight rates. Increased scrapping may lead to lower net growth of the fleet as discussed above.

Furthermore, the ongoing environmental discussions for emissions are beyond the ability of most of the CPLT with technological advances and through improved designs, which comply with them.

In particular, for the Phase 3 of the energy efficiency design index, only very few cities can provide highly efficient designs that are complied with such emission requirements. Under these circumstances, the order book and hence the existing drybulk fleet will not reinflate anytime soon.

Furthermore, the beauty of the future greenhouse gas measures and the lack of technological solutions in relation to new environmental-friendly fuels, enhance the uncertainty and put hold on new designs or new orders.

At this point, let me refer to our focus on developing a plan for renewing our fleet with modern designs that adhere to the new environmental regulations. And in this regard, to point out our recent order of the Japanese-built drybulk 82,000 dwt Kamsarmax class vessel, with the scheduled delivery in the first half of 2022.

The vessel is designed to meet the latest requirements of energy efficiency design index to greenhouse gases and EEDI Phase 3. It will also comply with the latest NOx emissions regulations that NOX-Tier III. Turning to next slide, #8, we make a brief presentation on the status of the fuels market.

Global lockdowns and mobility restrictions have reduced the demand for fuels and distillate products. Presently, the price of the 0.5%, a very low sulfur fuel oil, the IMO2020 fuel, is relatively weak in comparision to heavy fuel oil prices, and hence, their spread differential, the so-called Hi5, is in the region of USD 65 to USD 70.

On the graph in the left, we present the future market prices for very low sulfur fuel oil, high sulfur fuel oil and Hi5 in Rotterdam and in Singapore. Futures market indicate a recovery of the 0.5%, very low sulfur fuel oil and the Hi5 is trading at higher levels in the region of $80 to $90 for 2021 and further up in about -- to about $100 for 2023.

The recovery of global economies, the restoration of mobility and the recovery of crude oil prices may increase the demand of distillate products and will likely push the Hi5 differential to higher levels. Let's now summarize in Slide 9, the key takeaways for the market.

We see a resumption of economic activity after lockdown, China's GDP indicates a v-shape recovery, witnessing safety volume iron ore, coal and grain trade. At the same time, the second wave of COVID-19 remains a threat but the recent COVID vaccine news bring optimism in global markets despite the recent trade tensions between China and Australia.

The global lockdown has adversely affected demand for oil and distillate fuels. We may have a slow oil demand rebound as global lockdowns ease with the restoration of mobility, which will eventually lead to recovery of the Brent prices and to wider Hi5 spread differential.

We have declining order book 2020 onwards, and the ongoing decarbonization discussions do not favor new orders. And finally, the aging of the fleet, the low freight rates and the increased environmental CapEx may enhance the scrapping activity. Turning to Slide 10. We show our fleet growth over the last years, having added a new order recently.

It is important to note that our growth is gradual. The company has never entered in several orders that have distorted the supply side. At the same time, the company has kept the rate of growth even at loss-making markets and has invested always in the forefront of the technology. Turning to Slide 11.

In the context of our environment and social responsibility policies, we undertake significant environmental investments by retrofitting scrubbers and ballast water treatment systems on our fleet.

We have already invested $66.7 million as of September 30, 2020, and have retrofitted all 20 of our scheduled scrubbers and 30 ballast water treatment systems so far. On the table, we provide an estimation of the expected downtime in days for Q4 2020 and Q1 2021 in order to assist analysts within projections.

Turning to Slide 12, we have uploaded the BPI index as market performance indicator and our stock price. The correlation, historically, was very strong. In 2019, the correlation decoupled due to the trade war, and during 2020, we have seen further decoupling due to COVID pandemic.

Presently, our stock is trading at levels which we believe do not correspond with the market performance. This could potentially be a good entry point. Turning to Slide 13.

We focus on a strategic plan by gradually renewing our fleet, investing in new technologies and vessels with an environmental footprint that adhere to new greenhouse gas regulations. So far, our environmental investments include ballast water treatment system, installation of scrubbers, a project that has been completed.

Until now, we have invested $66.7 million, as I have already discussed. Furthermore, we show the improvements that the new designs bring, which are related to the faster dynamics, improved efficiency of propulsion, systems and managerial actions, which focus on environmental operations.

Concluding on Slide 14, let's summarize Safe Bulkers' key takeaways. SB stock is at an attractive entry point. Exposure in the spot market allows quick return to profits whenever market conditions improve.

Built-in advantage in environmental footprint due to Japanese tonnage 32 out of 42 vessels, management with about 50% stake, is aligned with shareholders.

We have developed a plan over the following year, which includes, in summary, lean operations, operational excellence and technical expertise, maintain strong liquidity, which provides for flexibility in this stable environment, and the cushion for opportunistic moves, gradual fleet renewal with the greenhouse gas EEDI Phase 3, Nox-Tier III vessels in parallel with financing arrangements, deleveraging in parallel with chartering markets, targeting to be the leading quality drybulk company and create value for all our shareholders.

Now I will pass the floor to our Chief Financial Officer, Konstantinos Adamopoulos, who will present our quarterly financials..

Thank you, Loukas, and good morning, everyone. Let me start with our chartering performance in Slide 16, where we'll present our quarterly time charter equivalent, which was $12,575 versus our quarterly OpEx, which stood at $4,896. Moving on to our debt profile, as seen in Slide 17, we present the repayment schedule as of September 30, 2020.

As of November 6, 2020, our liquidity stood at $136 million, consisting of cash and bank time deposits, restricted cash, funds available under our secured revolving credit facility as well as the sale and leaseback arrangement for the new built Kamsarmax class vessel.

Let me continue to Slide 18 and focus on our debt amortization schedule versus the scrap value of our fleet. We have a smooth debt repayment profile for the coming 2 years, gradually deleveraging our company. Moving on to Slide 19, we present our quarterly daily OpEx, which stood at $4,896 versus our quarterly daily G&A, which stood at $1,418.

The aggregate figure for both OpEx and G&A for the third quarter of 2020 was $6,314, demonstrating our focus on lean operations. We believe that this amount for both OpEx and G&A, when comparing apples-to-apples, is one of the industry's lower, if not the lowest.

We include in this figure, all our dry-docking expenses and in our G&A, our executive officers compensation and all expenses related to the administration of our company. Let's now move to Slide 20 with our quarterly financial highlights for the third quarter of 2020 compared to the same period of last year.

Net revenues increased by 2% to $51.9 million from $50.7 million. During the third quarter of 2020, our time charter equivalent was $12,575 for the third quarter of 2020 compared to $13,311 during the same period in 2019.

Net revenues were supported by the benefit from scrubber fitted vessels despite the reduced price differential between heavy fuel oil and compliant fuel, which was caused by the oil price war. And also by revenue contributed by our newbuilding delivery, we took delivery back in April.

Voyage expenses increased due to increased vessel repositioning expenses, higher loss on bunker sales, again due to the oil price war, and consumption costs for scrubber-fitted vessels. Daily vessel operating expenses increased by 10% to $4,896 compared to $4,448 for the same period in 2019.

Daily vessel running expenses, excluding light docking and predelivery expenses, also increased by 10% to $4,459 for the third quarter of 2020 compared to $4,053 for the same period last year. Our adjusted EBITDA for the third quarter of 2020 decreased to $22.3 million compared to $25.1 million for the Q3 of 2019.

Our adjusted earnings per share for the third quarter of 2020 was almost $0.00, calculated on a weighted average number of 102.2 million shares compared to $0.03 during the same period in 2019, calculated on a weighted average number of 101.3 million shares.

Closing our presentation in Slide 21, we show our quarterly fleet data and average daily indicators compared to the same period last year. We would like to emphasize that in this period, we have worked extensively despite the tough market conditions, and we have completed installation of all 20 scrubbers.

We have concluded the order of Japanese modern design and technology advanced vessel with delivery in the first half of 2022, with limited impact on our liquidity as we agreed at the same time, 90% finance resale and leaseback arrangement.

We have a strong balance sheet with comfortable leverage and small spread profile for the next two years and the liquidity position of $136 million. And finally, we took measures to protect our seafarers and shore employees' health and well-being and kept all of our vessels selling continuously servicing our charters.

Once again, we would like to thank our seafarers for their commitment and dedication and efforts throughout this tough period. Our press release presents in more detail our financial and operational results. We are now ready to take your questions..

[Operator Instructions]. We will now take our first question..

It's Chris Wetherbee from Citi. I guess a couple of questions here. First, just wanted to think about the vessel -- the fleet as it stands right now, just kind of taking a look at some of the older Panamaxes pushing towards that sort of 20-year mark over the course of the next couple of years.

How do you think about those? Can you talk a little bit about the leverage that are on those vessels specifically, if any? And would you consider potentially some sales here as you look to refresh and renew the fleet and move -- continue to move in sort of more of an eco-fashion? Just kind of curious how you're thinking about fleet management over the course of the next several quarters..

Yes. The idea is to gradually renew the fleet. So we order a new technology vessel for 2022. And the idea is, by that time, to sell 1 or 2 of the older vessels.

Of course, as we understand the right time should be next year simply because, right now, you have the problems of the pandemic and the COVID, restricted visit of people onboard ships because of traveling restrictions. Buyers to buy an older ship, he has to inspect.

And this is not easily operationally to achieve in today's restrictions in the various parts of the world. So yes, the idea is for next year to try and sell a couple of the older ships, and as we renew our fleet going forward, continue with selling those ships.

I believe 2021 would be a market that we would be more operationally flexible and market conditions should be improved so we could materialize such sales..

Okay. Okay. That makes sense, and that's helpful. I appreciate that. We have a little bit of a pickup in the order book in 2021. I mean depending on the vessel size, maybe it's in line with '20. But there's still some delivery there. There's not a lot of vessels in the book beyond 2021.

Have there been -- or sort of what's the tone of conversations with shippers? I mean what's sort of the discussion around the charter terms, the duration? Is there any -- I guess, maybe the question I'm asking is, is there any improvement in the discussions with your customers about getting maybe rates potentially moving in the right direction and maybe getting a little bit of duration on charters? I'm just trying to get a sense of maybe how your customers are setting up for the next sort of into 2021?.

Yes, up until last week, I think that the views were very skeptical in the market with what was going on with American elections and all the stories with the second round of the COVID-19, and the announcement on Monday by Pfizer about a vaccine that will come into availability by the start of the new year, changed a little bit the sentiment.

And this will take a few months to work into the system. So I believe that as people start getting clearer picture about economic recovery and prospects of full recovery as we run into 2021, the interest of our charters will come back for period of business and trying to do some charters. At the moment, it's very little activity.

And it's better for an owner to stay in the spot market because the period of activities are below breakeven levels. So it's absolutely no reason a healthy company should lock in period charters at today's market.

We are, overall, fairly optimistic if we find a solution on the COVID-19 situation that demand will be boosted, while supply is controllable. So this should be -- we should be entering into a good year should this announcement or the vaccine materializes into an effective tool for humanity..

Got it. Makes sense. And I guess the last question should be specifically around the expenses. So we've seen decent growth on a year-over-year basis. And I know kind of, seasonally, there's some variations, and 3Q has been a bit of an elevated OpEx quarter historically.

But when I think about OpEx and G&A, we're both looking at sort of elevated levels on a year-over-year basis. What can you do to bring those numbers down sustainably? I know you operate relatively well compared to the broader industry, but I'm thinking specifically about your fleet.

Are there things you can do from -- on the cost side to continue to try to work into a better profitability scenario?.

Look, first of all, the G&A expenses are quite stabilized. And also, they depend a little bit on the exchange rates between euro and dollar. So the only parameter that could substantially change this level is the exchange rate.

And I would like to repeat that in this G&A expenses, we include management fees and the audit fees and -- to run as a public company. And in the management fees, we will include also the compensation of the officers.

On the other side, the operating expenses had a great influence of dry-dockings, and quite often, I mean, this year, we had about 12, 15 dry-dockings, which was for several reasons. One of the reasons was that we have also the scrubbers and the ballast water treatment that we were fitting in several vessels. So the program was quite intense.

And when you go to a ship yard, let's say, sometimes a little bit earlier, you have the time to do some additional works and some additional checks on your equipment, which increase the cost. I think that as we move along next year, we have a substantially lower number of dry-docking.

So I tend to say I believe it would be about 5 scheduled dry-dockings that will reduce the figure. And this is because we have done so many this year. We have 5 next year. So we have lowered the cost earlier this year compared to next year.

The second point is that the company continues to operate, and we have also an internal program that -- to control the further operating expenses.

And I think that with the combination of the reduced dry-dockings and the program that we have, we -- this number will substantially be reduced, let's say, maybe we could target something between 4.2 to 4.3 or 4.4 for next year..

Thank you we will now take our next question..

It's Randy Giveans from Jefferies.

Well, on the Kamsarmax, the 2022 new building, what was the purchase price of that? And then secondly, following that, why purchase this vessel instead of maybe repurchase common or preferred shares here? And then following up on the large or the vessel acquisitions and the fleet renewal, any interest in an en bloc purchase of modern secondhand Ultramaxes or Kamsarmaxes?.

Yes. First of all, we are a ship owning company. And we have to start from somewhere, considering the renewal of the fleets. And we start adjusting ourselves to the new world about decarbonization, which will be the name of the game for the next 5 years.

So by going into this design, we go at the all-time low of new building prices like Japanese new building prices in the high 20s for a new technology ship, full of extras and full of all the new regulations included in the vessel. I mean if we want to buy stock, we can buy stock at any time. We can buy preferred share at any time.

Right now, we have a plan to start renewing the fleet, but as I said earlier, very selectively buying new technology ships. And hopefully, next year, at the right market conditions, to sell our well-maintained older ships, hopefully, as the world gets out of the pandemic. So this is not something that has to be done in a big scale.

It can be done in a very small scale, 1 or 2 ships during the next 2 years, and at the same time, selling 3 or 4 of the older ships in various times during 2021. So we have to renew the fleet and keep the age of the fleet as young as possible. So this was the idea behind it.

I don't know what -- where the prices of the ships will be when the market recovers, could be $34 million, $35 million. And of course, we will not do it in any big scale like in previous times, 2013, 2014. We will do it very gradually, and out of, hopefully, better results as the market improves.

What is very important to remember is that you have a company that -- we demonstrated that even during the worst year in memory since the mid-80s and 2016, 2020 is the worst year in memory with the pandemic, with lockdowns all over the world, with operational issues, with crude change problems, which are increasing the costs, we managed in the first quarter that the world start moving.

We demonstrated that we can turn back the stock, the stock and the result of a quarter into black from red. I think this demonstration in a very difficult year, that we can adjust so quickly back to profits, even small profits, like we did in this quarter, demonstrates that the company is there and can do things and can deliver results.

I think, of course, we need a normalized world and at a normalized situation to achieve better numbers..

If I may add also something about the question of buying back the common stock. I mean during the previous years and for each quarter end that we record always the number of stocks. If you notice, I mean, this number has reached $106 million, above $106 million, and presently stands at about $102 million, sales, yes.

This shows that the interest of the company is not the dilution, but sometimes, we have issued, historically, in the past, some shares. We bought back some shares always to maximize the benefit of the company. And right now, we are starting in almost the same number of shares that we stood a few years earlier.

So this shows the performance of our anti-dilution policy in real terms and not -- and show a certain point of time in the future, you may see us buying some shares.

But the important thing is that we won't -- our actions are always anti-dilutive because the management here has about 50% of the company, and it will never dilute in such a way that it will not create value for all the shareholders..

Got it. Okay. And then you mentioned about turning profits, obviously, in a tough third quarter, your TCE rates increased pretty meaningfully from around 8,000 a day in the second quarter to almost 13,000 a day or so in the third quarter.

Now how big of an increase are you expecting in the fourth quarter?.

Look, the fourth quarter is not developing a lot differently from the third quarter. You know it's -- the first month, it was at similar levels. And now there is one more headwind that we have to face, which, I believe, personally that it will result into a strong tailwind at the end. But right now, it's a headwind.

It's a trade war between -- not trade war, it's like saying a trade dispute between China and Australia on the import of Australian coking coal.

We know that there are pressures, political pressures from Chinese government to Australian exporters and tariffs imposed in other commodities, because they have these issues about the blame game for the pandemic. So this is a headwind we have at the moment.

But at the same time, I believe that this will create the benefit of bringing the coal, which they desperately needed in China for the steel mills, the coking coal. To bring it from further away, we already start seeing cargos from USA, from U.S. Gulf, from U.S.

East Coast, from Colombia, which is trebling the ton mines, which is very, very -- it will be very, very healthy for the market. So as the Chinese will start sourcing coal from further away, I think that the problem will become an opportunity. So we may see a lot better Q1 than we expect.

So the answer to your question is that Q4 will be pretty similar to Q3. The way it develops, we are in the middle of Q4, but I'm more optimistic that Q1 will be nowhere near where the last couple of Q1s were if things also with COVID-19 start to develop a little bit more positively with the news announced this Monday. So we are cautiously optimistic.

Of course, you may be bored every time we say we are cautiously optimistic. But indeed now, we believe that this will deliver into positive market for 2021..

Got it. All right. I guess last question for me.

Can you give some kind of guidance on the ballast water treatment CapEx here for the remaining 12, I guess, in the fourth quarter in 2021?.

Yes. As Loukas said, we have 5 dry-dockings remaining planned for 2021. So it's nowhere near the 13 we had for '20. And I think, out of this 5, we have 3 ballast water treatment to install. So it will be looking a lot better. And I mean we want to believe that this will show a lot in our OpEx for 2021..

It should be about let's say, $0.5 million. So it's about $1.5 billion capital expenditure for these three vessels..

What was that number?.

About $0.5 million for each..

Got it. Okay.

And so the remaining BWTS systems will be 2022 and 2023 to get to your 12 remaining?.

Yes. They are not too many. They are not too many because we have already reached 30. We'll go, I mean, next year, at about 33. The remaining will be in 2022 and 2023..

Let's say, 75% is already done. And then we have 3 years for the last 25%. So we've done the investment. And I mean, of course, as you know, the investments never stop in this world. We have to focus on new projects, of energy efficiency improvements and things like that.

But at least, we will concentrate to those and we will not have much of the rest hanging over the company..

We will now take our next question..

This is Frank Galanti on for Ben. Our question.

How do you think about adding to the fleet kind of above and beyond the Kamsarmax newbuild with where current asset values are? Obviously, the fleet renewal not being able to sell those new vessels now -- or sorry, the older vessels now, are you guys limited in being able to kind of potentially take advantage of these asset values? And then how do you weigh that against protecting the balance sheet?.

Yes, we cannot go out at full-scale and do what we would have done in 2013, 2014. We have to do it very gradually and at a very, very calculated basis. If we manage to sell 3 or 4 ships next year, this will open the door for more investments. Right now, we can -- we have done one. Maybe we do one more in the next few months.

I mean we have our eyes open because they are at a very low prices, $5 million, $6 million below previous designs, previous market levels and all the designs that we used to have.

And I believe we should do something when there is the right opportunity, but always from balancing together with the liquidity we want to maintain in the company, and the relation we have with a lot of banks and to be something that is not stretching the balance sheet and is not increasing the burden on the company.

That's why it will be -- if we do a new building, it will be new building coupled with financing, either in the form of wholesale and lease back or some other form that will not be shorting the cash position of the company. So we will be very careful of how we do that.

And next year, hopefully, I believe we will be -- the market will help us to sell a couple or all 3 or 4 of the older units at a little bit better level this year. As I explained, this year, it's impossible for a buyer of all the ships to go and inspect the ships. We have to respect that.

But the buyer will only pay a very low price if he cannot inspect the ship and take his chances and allow the extra $1 million or $2 million in the price differential for any unpleasant supplies.

So in our case, we want the buyer to go onboard and see the condition of the ships and not just offer a very low price and buying the vessel without inspecting..

In any case, we make money out of these vessels. So it's okay for us..

Okay. And switching gears a little bit. I wanted to ask about scrubber operations. Obviously, there's been a lot less emphasis with the fuel spread compressing.

But has there been any issues operating the scrubbers? Have you guys been able to run them at near 100% utilization? And is there HSFO available everywhere kind of in a post-COVID world?.

We're operating scrubbers now since May 2019. So 18 months since we started. We haven't faced a single hour of hire. We are very happy with the quality of the equipment we have received from very reputable manufacturer in Sweden, Alfa Laval. So we are getting good value for the money we invested.

As we enter next year, and the expectation is around -- the current market expectation is $80 on the spread between the 2 fuels, the heavy fuel oil and the sulfur. This will mean revenue for the company of an extra $10 million. So it's a revenue on top of what the ships are earning.

So we expect -- we think this is very good, and it's a lot better than 2020, which is, of course, at the start of 2020, we had $200 spread. But later in the year after the COVID and after the oil price collapse, the spread went down to $40 or $50, which is, of course, very low for the investment.

So it starts looking interesting again, and therefore, careful for us shows that it should be going higher. So for the company, it's an extra bonus to receive for the years to come. As I said, it's very, very important, the quality of the scrubber, and so far, so good.

18 months of operation of 20 scrubbers has shown to us that the job has been done successfully. Regarding the availability of HFO, I have absolutely don't find any issue all over the world to secure heavy fuel oil.

And to be honest with you, we have certain ports around the world that we have people who stocked up HFO to give us special deals better than the market deals to buy the HFO. So this is also something that helps a lot. But I have not experienced any port, any major port that will call, but there is an issue of availability of heavy fuel oil.

Only in some very minor ports, you may not find, but I mean, the operation of Kamsarmaxes and PostPanamaxes is so standardized that every 2 or 3 months, you pass from certain key points, but there is availability of all grades of fuel.

I mean the bunker trade, those are very smart people and the bunker suppliers and the oil major are very smart people to position their products at the places where the ships are passing from. So I mean, for us, it's absolutely no problem to secure the products at the relevant ports.

Of course, when you pass on the relevant ports, you must have sometimes your operational people alert to take maximum benefit of the availability of fuel. So you don't take only 500 tons. If you are passing on Singapore, you take 2,000 tons. And you have the product on board to be used in the next couple of tricks.

And if you find cheap HFO in a cheap port, you take advantage of it. You have to remember that, if I may add, sorry, on the last question, that we are not managers of ships as such, we are ship owners.

And our job, we make a living out of those situations, trying to maximize the returns of what the ships are doing and try to plan, assess and with the know-how we have on the markets and because we have homogeneous fleet to try and maximize when such opportunities exist.

So you know in which ports you will face difficulty of securing, for example, low sulfur NGO. You take advantage on previous ports, you stock up, then you may sell to charters at more attractive prices when they go to a nonconvenient port. All these things, you have to be a ship owner to run it efficiently and properly.

If you are just a manager and you are running ships for third parties, you will find, at a certain point, that the whole equation cannot be executed perfectly..

There are no further questions. Please continue. Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may now disconnect..

Thank you to all, and we're looking forward to discuss again with you for our results next quarter. Thank you..

Thank you..