SB — Safe Bulkers, Inc.

Summary of Safe Bulker's Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Adjusted Earnings Per Share: $0.14, down from $0.15 in Q4 2024.
• Adjusted EBITDA: $37.4 million, compared to $40.7 million in Q4 2024.
• Net Revenues: $72.6 million.
• Dividend Declared: $0.05 per share, marking the 17th consecutive quarterly dividend, yielding 3.3%.
• Average Time Charter Equivalent (TCE): $17,050, slightly up from $16,521 in Q4 2024.
• Daily Vessel Operating Expenses: Increased by 13% to $5,683.
• Liquidity Position: $382 million in total liquidity, including $163 million in cash and $220 million in undrawn revolving credit facilities.

2. Strategic Updates and Business Highlights

• The company maintains a balanced exposure between spot and time-charter contracts, enhancing cash flow visibility.
• Fleet renewal is ongoing, with 8 new Phase 3 vessels on order, expected to enhance operational efficiency.
• The fleet consists of 45 vessels, with 12 Phase 3 vessels already in operation and 26 vessels upgraded for environmental compliance.
• The company is focusing on quality, with 80% of its fleet being Japanese-built, and a younger average fleet age of 10.5 years compared to the global average of 12.6 years.

3. Forward Guidance and Outlook

• The dry-bulk market is expected to experience a marginal supply-demand equilibrium in 2026, with demand growth projected at 2-3%.
• The company anticipates continued strength in the freight market into early 2026, supported by a backlog of contracted revenues exceeding $164 million.
• The outlook for specific commodities indicates growth in grains (5-6%) and stable demand for iron ore, while coal shipments are expected to decline.

4. Bad News, Challenges, or Points of Concern

• Increased Operating Expenses: Daily vessel operating expenses rose significantly, which could pressure margins.
• Market Volatility: The dry-bulk market remains volatile due to geopolitical factors and economic uncertainties, particularly in China.
• Aging Fleet Concerns: A significant portion of the global dry-bulk fleet is aging, with 35% exceeding 15 years, which may lead to increased operational costs and regulatory compliance challenges.
• Limited Newbuild Options: The secondhand market is constrained, with limited availability of quality vessels, potentially impacting fleet renewal strategies.

5. Notable Q&A Insights

• Fleet Renewal Strategy: Management acknowledged the difficulty in acquiring quality secondhand vessels due to rising prices and limited availability, indicating a preference for newbuilds despite long lead times.
• Charter Market Dynamics: There is currently no appetite for longer-term (2-3 year) charters; the market is still recovering, with a focus on shorter-term contracts (6-12 months).
• Fixed vs. Index-linked Contracts: Management prefers fixed-rate contracts in the current market environment, indicating that charterers are currently more inclined towards fixed rates as the market improves.

Overall, Safe Bulkers reported a stable financial performance amid a recovering market, with strategic initiatives focused on fleet modernization and maintaining a strong balance sheet, while also navigating challenges related to operating costs and market volatility.