UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

⌧

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

◻

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-33393

GENCO SHIPPING & TRADING LIMITED

(Exact name of registrant as specified in its charter)

Republic of the Marshall Islands

98-0439758

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

299 Park Avenue, 12th Floor, New York, New York 10171

(Address of principal executive offices) (Zip Code)

(646) 443-8550

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of exchange on which registered
Common stock, par value $0.01 per share	GNK	New York Stock Exchange (NYSE)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ⌧	Accelerated filer ◻	Non-accelerated filer ◻	Smaller reporting company ☐
			Emerging growth company ◻

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ⌧ No ◻

The number of shares outstanding of each of the issuer’s classes of common stock, as of May 8, 2024: Common stock, par value $0.01 per share — 42,751,752 shares.

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Genco Shipping & Trading Limited

			Page

	PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)		4

	a)	Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023	4

	b)	Condensed Consolidated Statements of Operations for the Three Months ended March 31, 2024 and 2023	5

	c)	Condensed Consolidated Statements of Comprehensive Income for the Three Months ended March 31, 2024 and 2023	6

	d)	Condensed Consolidated Statements of Equity for the Three Months ended March 31, 2024 and 2023	7

	e)	Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2024 and 2023	8

	f)	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		44

Item 4.	Controls and Procedures		45

	PART II —OTHER INFORMATION

Item 5.	Other Information		45

Item 6.	Exhibits		45

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Website Information

We intend to use our website, www.GencoShipping.com, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included in our website’s Investor section. Accordingly, investors should monitor the Investor portion of our website, in addition to following our press releases, filings with the U.S. Securities and Exchange Commission (the “SEC”), public conference calls, and webcasts. To subscribe to our e-mail alert service, please submit your e-mail address at the Investor Relations Home page of the Investor section of our website. The information contained in, or that may be accessed through, our website is not incorporated by reference into or a part of this document or any other report or document we file with or furnish to the SEC, and any references to our website are intended to be inactive textual references only.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Genco Shipping & Trading Limited

Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023

(U.S. Dollars in thousands, except for share and per share data)

(Unaudited)


	March 31,		December 31,
	2024		2023

Assets
Current assets:
Cash and cash equivalents	$	48,364	$	46,542
Due from charterers, net of a reserve of $2,299 and $3,257, respectively		21,888		17,815
Prepaid expenses and other current assets		9,076		10,154
Inventories		30,638		26,749
Fair value of derivative instruments		—		572
Vessels held for sale		36,218		55,440
Total current assets		146,184		157,272

Noncurrent assets:
Vessels, net of accumulated depreciation of $308,626 and $296,452, respectively		934,572		945,114
Deferred drydock, net of accumulated amortization of $27,480 and $23,047 respectively		27,264		29,502
Fixed assets, net of accumulated depreciation and amortization of $8,134 and $8,063, respectively		7,211		7,071
Operating lease right-of-use assets		2,260		2,628
Restricted cash		315		315
Total noncurrent assets		971,622		984,630

Total assets	$	1,117,806	$	1,141,902

Liabilities and Equity
Current liabilities:
Accounts payable and accrued expenses	$	31,296	$	24,245
Deferred revenue		5,679		8,746
Current operating lease liabilities		2,325		2,295
Total current liabilities:		39,300		35,286

Noncurrent liabilities:
Long-term operating lease liabilities		1,208		1,801
Long-term debt, net of deferred financing costs of $9,332 and $9,831, respectively		160,668		190,169
Total noncurrent liabilities		161,876		191,970

Total liabilities		201,176		227,256

Commitments and contingencies (Note 14)

Equity:
Common stock, par value $0.01; 500,000,000 shares authorized; 42,751,752 and 42,546,959 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively		427		425
Additional paid-in capital		1,536,987		1,553,421
Accumulated other comprehensive income		—		527
Accumulated deficit		(622,319)		(641,117)
Total Genco Shipping & Trading Limited shareholders’ equity		915,095		913,256
Noncontrolling interest		1,535		1,390
Total equity		916,630		914,646
Total liabilities and equity	$	1,117,806	$	1,141,902

See accompanying notes to Condensed Consolidated Financial Statements.

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Genco Shipping & Trading Limited

Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and 2023

(U.S. Dollars in Thousands, Except for Earnings Per Share and Share Data)

(Unaudited)


	For the Three Months Ended
	March 31,
	2024		2023
Revenues:
Voyage revenues	$	117,435	$	94,391

Total revenues		117,435		94,391

Operating expenses:
Voyage expenses		37,200		37,435
Vessel operating expenses		25,932		24,393
Charter hire expenses		3,510		3,664
General and administrative expenses (inclusive of nonvested stock amortization expense of $1,382 and $1,559, respectively)		7,664		7,750
Technical management expenses		1,031		762
Depreciation and amortization		17,223		15,944
Loss on sale of vessels		978		—
Other operating expense		1,804		—

Total operating expenses		95,342		89,948

Operating income		22,093		4,443

Other income (expense):
Other income (expense)		66		(324)
Interest income		824		770
Interest expense		(4,040)		(2,029)

Other expense, net		(3,150)		(1,583)

Net income		18,943		2,860
Less: Net income attributable to noncontrolling interest		145		226
Net income attributable to Genco Shipping & Trading Limited	$	18,798	$	2,634

Earnings per share-basic	$	0.44	$	0.06
Earnings per share-diluted	$	0.43	$	0.06
Weighted average common shares outstanding-basic		42,918,248		42,632,059
Weighted average common shares outstanding-diluted		43,606,580		43,097,362

See accompanying notes to Condensed Consolidated Financial Statements.

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Genco Shipping & Trading Limited

Condensed Consolidated Statements of Comprehensive Income

For the Three Months Ended March 31, 2024 and 2023

(U.S. Dollars in Thousands)

(Unaudited)


	For the Three Months Ended
	March 31,
	2024		2023

Net income	$	18,943	$	2,860

Other comprehensive loss		(527)		(1,628)

Comprehensive income		18,416		1,232
Less: Comprehensive income attributable to noncontrolling interest		145		226
Comprehensive income attributable to Genco Shipping & Trading Limited	$	18,271	$	1,006

See accompanying notes to Condensed Consolidated Financial Statements.

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Genco Shipping & Trading Limited

Condensed Consolidated Statements of Equity

For the Three Months Ended March 31, 2024 and 2023

(U.S. Dollars in Thousands)


									Genco
									Shipping &
					Accumulated				Trading
			Additional		Other				Limited
	Common		Paid-in		Comprehensive		Accumulated		Shareholders'		Noncontrolling
	Stock		Capital		Income		Deficit		Equity		Interest		Total Equity
Balance — January 1, 2024	$	425	$	1,553,421	$	527	$	(641,117)	$	913,256	$	1,390	$	914,646

Net income								18,798		18,798		145		18,943

Other comprehensive loss						(527)				(527)				(527)

Issuance of shares due to vesting of RSUs and exercise of options		2		(2)						—				—

Cash dividends declared ($0.41 per share)				(17,814)						(17,814)				(17,814)

Nonvested stock amortization				1,382						1,382				1,382

Balance — March 31, 2024	$	427	$	1,536,987	$	—	$	(622,319)	$	915,095	$	1,535	$	916,630


									Genco
									Shipping &
					Accumulated				Trading
			Additional		Other				Limited
	Common		Paid-in		Comprehensive		Accumulated		Shareholders'		Noncontrolling
	Stock		Capital		Income		Deficit		Equity		Interest		Total Equity
Balance — January 1, 2023	$	423	$	1,588,777	$	6,480	$	(628,247)	$	967,433	$	876	$	968,309

Net income								2,634		2,634		226		2,860

Other comprehensive loss						(1,628)				(1,628)				(1,628)

Issuance of shares due to vesting of RSUs and exercise of options		2		(2)						—				—

Cash dividends declared ($0.50 per share)				(21,516)						(21,516)				(21,516)

Nonvested stock amortization				1,559						1,559				1,559

Balance — March 31, 2023	$	425	$	1,568,818	$	4,852	$	(625,613)	$	948,482	$	1,102	$	949,584

See accompanying notes to Condensed Consolidated Financial Statements.

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Genco Shipping & Trading Limited

Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023

(U.S. Dollars in Thousands)

(Unaudited)


	For the Three Months Ended
	March 31,
	2024		2023
Cash flows from operating activities:
Net income	$	18,943	$	2,860
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		17,223		15,944
Amortization of deferred financing costs		499		418
Right-of-use asset amortization		368		360
Amortization of nonvested stock compensation expense		1,382		1,559
Loss on sale of vessels		978		—
Amortization of premium on derivatives		45		59
Insurance proceeds for protection and indemnity claims		117		34
Change in assets and liabilities:
(Increase) decrease in due from charterers		(4,073)		8,641
Decrease (increase) in prepaid expenses and other current assets		651		(2,263)
Increase in inventories		(3,889)		(3,428)
Increase (decrease) in accounts payable and accrued expenses		5,831		(97)
(Decrease) increase in deferred revenue		(3,067)		71
Decrease in operating lease liabilities		(563)		(480)
Deferred drydock costs incurred		(2,194)		(4,112)
Net cash provided by operating activities		32,251		19,566

Cash flows from investing activities:
Purchase of vessels and ballast water treatment systems, including deposits		(930)		(2,003)
Purchase of other fixed assets		(240)		(1,085)
Net proceeds from sale of vessels		18,505		—
Insurance proceeds for hull and machinery claims		159		235
Net cash provided by (used in) investing activities		17,494		(2,853)

Cash flows from financing activities:
Repayments on the $500 Million Revolver		(30,000)		—
Repayments on the $450 Million Credit Facility		—		(8,750)
Cash dividends paid		(17,885)		(21,666)
Payment of deferred financing costs		(38)		—
Net cash used in financing activities		(47,923)		(30,416)

Net increase (decrease) in cash, cash equivalents and restricted cash		1,822		(13,703)

Cash, cash equivalents and restricted cash at beginning of period		46,857		64,100
Cash, cash equivalents and restricted cash at end of period	$	48,679	$	50,397

See accompanying notes to Condensed Consolidated Financial Statements.

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Genco Shipping & Trading Limited

(U.S. Dollars in Thousands, Except Per Share and Share Data)

Notes to Condensed Consolidated Financial Statements (unaudited)

1 – GENERAL INFORMATION

The accompanying Condensed Consolidated Financial Statements include the accounts of Genco Shipping & Trading Limited (“GS&T”) and its direct and indirect subsidiaries (collectively, the “Company”). The Company is engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk vessels and operates in one business segment.

As of March 31, 2024, the Company’s fleet consisted of 45 drybulk vessels, including 18 Capesize drybulk vessels, 15 Ultramax drybulk vessels and twelve Supramax drybulk vessels, with an aggregate carrying capacity of approximately 4,828,000 dwt and an average age of approximately 11.8 years.

During September 2021, the Company and Synergy Marine Pte. Ltd. (“Synergy”), a third party, formed a joint venture, GS Shipmanagement Pte. Ltd. (“GSSM”). GSSM is owned 50% by the Company and 50% by Synergy as of March 31, 2024 and December 31, 2023, which provides ship management services to the Company’s vessels. As of March 31, 2024 and December 31, 2023, the cumulative investments GSSM received from the Company and Synergy totaled $50 and $50, respectively, which were used for expenditures directly related to the operations of GSSM.

Management has determined that GSSM qualifies as a variable interest entity, and, when aggregating the variable interest held by the Company and Synergy, the Company is the primary beneficiary as the Company has the ability to direct the activities that most significantly impact GSSM’s economic performance. Accordingly, the Company consolidates GSSM.

2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and the rules and regulations of the SEC that apply to interim financial statements, including the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the disclosures and footnotes normally included in complete consolidated financial statements prepared in conformity with U.S. GAAP. They should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 27, 2024 (the “2023 10-K”). The accompanying Condensed Consolidated Financial Statements include the accounts of GS&T and its direct and indirect wholly-owned subsidiaries and GSSM. All intercompany accounts and transactions have been eliminated in consolidation.

In the opinion of management of the Company, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and operating results have been included in the statements. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the operating results to be expected for the year ending December 31, 2024.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include vessel valuations, impairment of vessels, the valuation of amounts due from charterers, performance claims, residual value of vessels, useful life of vessels, the fair value of time charters acquired, performance-based restricted stock units and the fair value of derivative instruments, if any. Actual results could differ from those estimates.

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Cash, cash equivalents and restricted cash

The Company considers highly liquid investments, such as money market funds and certificates of deposit with an original maturity of three months or less at the time of purchase to be cash equivalents. Non-current restricted cash includes cash that is restricted pursuant to our lease agreement. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheets that sum to the total of the same amounts shown in the Condensed Consolidated Statements of Cash Flows:


	March 31,		December 31,
	2024		2023
Cash and cash equivalents	$	48,364	$	46,542
Restricted cash – current		—		—
Restricted cash – noncurrent		315		315

Cash, cash equivalents and restricted cash	$	48,679	$	46,857

Vessels held for sale

On November 14, 2023 the Company entered into an agreement to sell the Genco Commodus and the sale of the vessel was completed on February 7, 2024. The relevant vessel assets have been classified as held for sale in the Condensed Consolidated Balance Sheet as of December 31, 2023.

Additionally, on December 21, 2023 the Company entered into agreements to sell the Genco Claudius and Genco Maximus. On February 24, 2024, the Company terminated its agreements to sell the Genco Claudius and the Genco Maximus due to the buyers’ breach of the agreements’ terms. During the first quarter of 2024, the Company commenced arbitration with the buyers, seeking a declaration that it validly terminated the agreements due to the buyers’ breach, and to retain the deposits paid by the buyers in connection with the sales, totaling $3,650. During the second quarter of 2024, the Company and the buyers reached an agreement in principle to settle this matter and conclude the arbitration proceeding in exchange for the buyers releasing the deposits to the Company. On March 1, 2024, the Company entered into new agreements to sell the Genco Claudius and Genco Maximus to a separate unaffiliated third-party. The relevant vessel assets have been classified as held for sale in the Condensed Consolidated Balance Sheet as of March 31, 2024 and December 31, 2023. Refer to Note 4 — Vessel Acquisitions and Dispositions for details of the agreements.

Bunker swap and forward fuel purchase agreements

From time to time, the Company may enter into fuel hedge agreements with the objective of reducing the risk of the effect of changing fuel prices. The Company has entered into bunker swap agreements and forward fuel purchase agreements. The Company’s bunker swap agreements and forward fuel purchase agreements do not qualify for hedge accounting treatment; therefore, any unrealized or realized gains and losses are recorded in the Condensed Consolidated Statements of Operations. Derivatives are Level 2 instruments in the fair value hierarchy.

During the three months ended March 31, 2024 and 2023, the Company recorded $18 and $108 of realized gains in other income (expense), respectively. During the three months ended March 31, 2024 and 2023, the Company recorded $160 and ($42) of unrealized gains (losses) in other income (expense), respectively.

The total fair value of the bunker swap agreements and forward fuel purchase agreements in an asset position as of March 31, 2024 and December 31, 2023 is $161 and $1, respectively, and are recorded in prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets. The total fair value of the bunker swap agreements and

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forward fuel purchase agreements in a liability position as of March 31, 2024 and December 31, 2023 is $1 and $0, respectively, and are recorded in accounts payable and accrued expenses in the Condensed Consolidated Balance Sheets.

Voyage expense recognition

In time charters and spot market-related time charters, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. These expenses are borne by the Company during spot market voyage charters. As such, there are significantly higher voyage expenses for spot market voyage charters as compared to time charters and spot market-related time charters. There are certain other non-specified voyage expenses, such as commissions, which are typically borne by the Company. At the inception of a time charter, the Company records the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer as a gain or loss within voyage expenses. Additionally, the Company records lower of cost and net realizable value adjustments to re-value the bunker fuel on a quarterly basis for certain time charter agreements where the inventory is subject to gains and losses. These differences in bunkers, including any lower of cost and net realizable value adjustments, resulted in a net gain (loss) of $80 and ($371) during the three months ended March 31, 2024 and 2023, respectively. Additionally, voyage expenses include the cost of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement.

Loss on sale of vessels

During the three months ended March 31, 2024, the Company recorded a net loss of $978 related primarily to the sale of the Genco Commodus. During the three months ended March 31, 2023, the Company did not complete the sale of any vessels. Refer to Note 4 — Vessel Acquisitions and Dispositions for further detail regarding the sale of these vessels.

Other operating expense

Other operating expense of $1,804 recorded during the three months ended March 31, 2024 consists of costs incremental to routine expenses that were incurred related to the Company’s 2024 annual meeting to be held on May 23, 2024.

3 – CASH FLOW INFORMATION

For the three months ended March 31, 2024, the Company had non-cash investing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in Accounts payable and accrued expenses consisting of $961 for the Purchase of vessels and ballast water treatment systems, including deposits, $678 for the Purchase of other fixed assets and $178 for the Net proceeds from sale of vessels. For the three months ended March 31, 2024, the Company had non-cash financing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in Accounts payable and accrued expense consisting of $959 for Cash dividends payable.

For the three months ended March 31, 2023, the Company had non-cash investing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in Accounts payable and accrued expenses consisting of $766 for the Purchase of vessels and ballast water treatment systems, including deposits, and $553 for the Purchase of other fixed assets. For the three months ended March 31, 2023, the Company had non-cash financing activities not included in the Condensed Consolidated Statement of Cash Flows for items included in Accounts payable and accrued expense consisting of $906 for Cash dividends payable.

During the three months ended March 31, 2024 and 2023, cash paid for interest, net of amounts capitalized, was $4,001 and $3,331, respectively, which was offset by $588 and $1,827 received as result of the interest rate cap agreements, respectively.

During the three months ended March 31, 2024 and 2023, any cash paid for income taxes was insignificant.

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All stock options exercised during the three months ended March 31, 2024 and 2023 were cashless. Refer to Note 13 — Stock-Based Compensation for further information.

On February 21, 2024, the Company granted 168,411 restricted stock units and 99,065 performance-based restricted stock units to certain individuals. The aggregate fair value of these restricted stock units and performance-based restricted stock units was $3,060 and $2,143, respectively.

On March 10, 2023, the Company granted 2,948 restricted stock units to an individual. The aggregate fair value of these restricted stock units was $50.

On February 21, 2023, the Company granted 68,758 restricted stock units to certain individuals. The aggregate fair value of these restricted stock units was $1,250.

Refer to Note 13 — Stock-Based Compensation for further information regarding the aforementioned grants.

Supplemental Condensed Consolidated Cash Flow information related to leases is as follows:


	For the Three Months Ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	613	$	557

4 – VESSEL ACQUISITIONS AND DISPOSITIONS

Vessel Acquisitions

On October 10, 2023, the Company entered into an agreement to acquire a 2016-built 181,000 dwt Capesize vessel that was renamed the Genco Ranger for a purchase price of $43,100. Additionally, on November 14, 2023, the Company entered into an agreement to acquire a 2016-built 181,000 dwt Capesize vessel that was renamed the Genco Reliance for a purchase price of $43,000. The Genco Ranger and Genco Reliance were delivered on November 27, 2023 and November 21, 2023, respectively. The Company utilized a combination of cash on hand as well as a $65,000 draw down on the $450 Million Credit Facility (as defined in Note 7 below) to finance the purchases.

Vessel Dispositions

On November 14, 2023, the Company entered into an agreement to sell the Genco Commodus, a 2009-built Capesize vessel, to a third party for $19,500 less a 1.0% commission payable to a third party. The sale was completed on February 7, 2024.

Additionally, on December 21, 2023, the Company entered into agreements to sell the Genco Claudius, a 2010-built Capesize vessel, to a third party for $18,500 less a 1.0% commission payable to a third party and the Genco Maximus, a 2009-built Capesize vessel, to a third party for $18,000 less a 1.0% commission payable to a third party. On February 24, 2024, the Company terminated its agreements to sell the Genco Claudius and the Genco Maximus due to the buyers’ breach of the agreements’ terms. On March 1, 2024, the Company entered into new agreements to sell the Genco Claudius and Genco Maximus to a separate unaffiliated third-party for $24,200 less a 2.0% commission payable to a third party and $22,800 less a 2.0% commission payable to a third party, respectively. The sales of the Genco Claudius and Genco Maximus were completed on April 22, 2024 and April 2, 2024, respectively.

5 – EARNINGS PER SHARE

The computation of basic earnings per share is based on the weighted-average number of common shares outstanding during the reporting period. The computation of diluted earnings per share assumes the vesting of nonvested

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stock awards and the exercise of stock options (refer to Note 13 — Stock-Based Compensation), for which the assumed proceeds upon vesting are deemed to be the amount of compensation cost attributable to future services and are not yet recognized using the treasury stock method, to the extent dilutive.

The components of the denominator for the calculation of basic and diluted earnings per share are as follows:


	For the Three Months Ended
	March 31,
	2024	2023

Common shares outstanding, basic:
Weighted-average common shares outstanding, basic	42,918,248	42,632,059

Common shares outstanding, diluted:
Weighted-average common shares outstanding, basic	42,918,248	42,632,059

Dilutive effect of stock options	200,531	214,611

Dilutive effect of performance-based restricted stock units	162,735	—

Dilutive effect of restricted stock units	325,066	250,692

Weighted-average common shares outstanding, diluted	43,606,580	43,097,362

6 – RELATED PARTY TRANSACTIONS

During the three months ended March 31, 2024 and 2023, the Company did not have any related party transactions.

7 – DEBT

Long-term debt, net consists of the following:


	March 31,		December 31,
	2024		2023
Principal amount	$	170,000	$	200,000
Less: Unamortized deferred financing costs		(9,332)		(9,831)
Less: Current portion		—		—

Long-term debt, net	$	160,668	$	190,169

$500 Million Revolver

On November 29, 2023, the Company entered into a fourth amendment to amend, extend and upsize its existing $450 Million Credit Facility (as defined below). The amended structure consists of a $500 million revolving credit facility, which can be utilized to support growth of our asset base as well as general corporate purposes (the “$500 Million Revolver”). The maturity date of the $500 Million Revolver is November 29, 2028.

As of March 31, 2024, there was $298,894 availability under the $500 Million Revolver. Total debt repayments of $30,000 were made during the three months ended March 31, 2024 under the $500 Million Revolver.

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As of March 31, 2024, the Company was in compliance with all of the financial covenants under the $500 Million Revolver.

$450 Million Credit Facility

On August 3, 2021, the Company entered into the $450 Million Credit Facility, a five-year senior secured credit facility which was allocated between an up to $150,000 term loan facility and an up to $300,000 revolving credit facility which was used to refinance the Company’s two prior credit facilities.

On May 30, 2023, the Company entered into an amendment to the $450 Million Credit Facility to transition from the use of the London Inter-Bank Offered Rate (“LIBOR”) to calculate interest to the Secured Overnight Financing Rate (“SOFR”) effective June 30, 2023. Borrowings began bearing interest at SOFR plus the applicable margin effective June 30, 2023.

Total debt repayments of $8,750 were made during the three months ended March 31, 2023 under the $450 Million Credit Facility.

On November, 29, 2023, the Company entered into a fourth amendment to the $450 Million Credit Facility; refer to the “$500 Million Revolver” section above.

Interest rates

The following table sets forth the effective interest rate associated with the interest expense for the Company’s debt facilities noted above, including the cost associated with unused commitment fees, if applicable. The effective interest rate below does not include the effect of any interest rate cap agreements. The following table also includes the range of interest rates on the debt, excluding the impact of unused commitment fees, if applicable:


	For the Three Months Ended
	March 31,
	2024		2023
Effective Interest Rate	8.35	%	7.76	%
Range of Interest Rates (excluding unused commitment fees)	7.18% to 7.21	%	6.43 % to 7.00	%

8 – DERIVATIVE INSTRUMENTS

The Company is exposed to interest rate risk on its floating rate debt. As of December 31, 2023, the Company had one interest rate cap agreement outstanding to manage interest costs and the risk associated with variable interest rates. This $50,000 interest rate cap agreement expired on March 28, 2024, therefore as of March 31, 2024, the Company no longer has any interest rate cap agreements. The interest rate cap agreement was initially designated and qualified as a cash flow hedge. The premium paid was recognized in income on a rational basis, and all changes in the fair value of the caps were deferred in Accumulated other comprehensive income (“AOCI”) and were subsequently reclassified into Interest expense in the period when the hedged interest affected earnings.

The Company recorded a $527 unrealized loss for the three months ended March 31, 2024 in AOCI. There is no remaining AOCI as of March 31, 2024.

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The Effect of Cash Flow Hedge Accounting on the Statements of Operations

	For the Three Months Ended March 31,
	2024		2023
	Interest Expense		Interest Expense
Total amounts of income and expense line items presented in the statements of operations in which the effects of cash flow hedges are recorded	$	4,040	$	2,029

The effects of cash flow hedging

Gain or (loss) on cash flow hedging relationships in Subtopic 815-20:
Interest contracts:
Amount of gain or (loss) reclassified from AOCI to income	$	(568)	$	(1,724)
Premium excluded and recognized on an amortized basis		18		39
Amount of gain or (loss) reclassified from AOCI to income as a result that a forecasted transaction is no longer probable of occurring		—		—

The following table shows the interest rate cap assets as of March 31, 2024 and December 31, 2023:


			March 31,		December 31,
	Balance Sheet Location		2024		2023
Derivatives designated as hedging instruments
Interest rate caps	Fair value of derivative instruments - current	$	—	$	515

Interest rate caps	Fair value of derivative instruments - noncurrent	$	—	$	—

Derivatives not designated as hedging instruments
Interest rate caps	Fair value of derivative instruments - current	$	—	$	57

Interest rate caps	Fair value of derivative instruments - noncurrent	$	—	$	—

The components of AOCI included in the accompanying Condensed Consolidated Balance Sheet consists of net unrealized losses on cash flow hedges as of March 31, 2024.


AOCI — January 1, 2024	$	527

Amount recognized in OCI on derivative, intrinsic		(533)
Amount recognized in OCI on derivative, excluded		6
Amount reclassified from OCI into income		—

AOCI — March 31, 2024	$	—

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9 – FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair values and carrying values of the Company’s financial instruments as of March 31, 2024 and December 31, 2023 which are required to be disclosed at fair value, but not recorded at fair value, are noted below.


	March 31, 2024				December 31, 2023
	Carrying				Carrying
	Value		Fair Value		Value		Fair Value
Cash and cash equivalents	$	48,364	$	48,364	$	46,542	$	46,542
Restricted cash		315		315		315		315
Principal amount of floating rate debt		170,000		170,000		200,000		200,000

The carrying value of the borrowings under the $500 Million Revolver as of March 31, 2024 and December 31, 2023, which excludes the impact of deferred financing costs, approximate their fair value due to the variable interest nature thereof as this credit facility represents a floating rate loan. The carrying amounts of the Company’s other financial instruments as of March 31, 2024 and December 31, 2023 (principally Due from charterers and Accounts payable and accrued expenses) approximate fair values because of the relatively short maturity of these instruments.

ASC Subtopic 820-10, “Fair Value Measurements & Disclosures” (“ASC 820-10”), applies to all assets and liabilities that are being measured and reported on a fair value basis. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The fair value framework requires the categorization of assets and liabilities into three levels based upon the assumption (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 requires significant management judgment. The three levels are defined as follows:

●

Level 1—Valuations based on quoted prices in active markets for identical instruments that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

●

Level 2—Valuations based on quoted prices in active markets for instruments that are similar, or quoted prices in markets that are not active for identical or similar instruments, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

●

Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Cash and cash equivalents and restricted cash are considered Level 1 items, as they represent liquid assets with short-term maturities. Floating rate debt is considered to be a Level 2 item, as the Company considers the estimate of rates it could obtain for similar debt or based upon transactions amongst third parties. Interest rate cap agreements, bunker swap agreements and forward fuel purchase agreements are considered to be Level 2 items. Refer to Note 8 — Derivative Instruments and Note 2 — Summary of Significant Accounting Policies, respectively, for further information. Nonrecurring fair value measurements include vessel impairment assessments completed during the interim period and at year-end as determined based on third-party quotes, which are based on various data points, including comparable sales of similar vessels, which are Level 2 inputs. There was no vessel impairment recorded during the three months ended March 31, 2024 and 2023.

The fair value determination for the operating lease right-of-use assets was based on third party quotes, which is considered a Level 2 input. Nonrecurring fair value measurements may include impairment tests of the Company’s operating lease right-of-use assets if there are indicators of impairments. During the three months ended March 31, 2024 and 2023, there were no indicators of impairment of the operating lease right-of-use assets.

The Company did not have any Level 3 financial assets or liabilities as of March 31, 2024 and December 31, 2023.

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10 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of the following:


	March 31,		December 31,
	2024		2023
Accounts payable	$	14,498	$	10,650
Accrued general and administrative expenses		3,730		5,700
Accrued vessel operating expenses		13,068		7,895
Total accounts payable and accrued expenses	$	31,296	$	24,245

11 – VOYAGE REVENUES

Total voyage revenues include revenue earned on fixed rate time charters, spot market voyage charters and spot market-related time charters, as well as the sale of bunkers consumed during short-term time charters. For the three months ended March 31, 2024 and 2023, the Company earned $117,435 and $94,391 of voyage revenues, respectively.

Total voyage revenues recognized in the Condensed Consolidated Statements of Operations includes the following:


	For the Three Months Ended
	March 31,
	2024		2023
Lease revenue	$	43,182	$	36,967
Spot market voyage revenue		74,253		57,424
Total voyage revenues	$	117,435	$	94,391

12 – LEASES

On June 14, 2019, the Company entered into a sublease agreement for a portion of the leased space for its main office in New York, New York that commenced on July 26, 2019 and will end on September 29, 2025. There was $306 of sublease income recorded during the three months ended March 31, 2024 and 2023. Sublease income is recorded net with the total operating lease costs in General and administrative expenses in the Condensed Consolidated Statements of Operations.

The Company charters in third-party vessels and the Company is the lessee in these agreements under ASC 842. The Company has elected the practical expedient under ASC 842 to not recognize right-of-use assets and lease liabilities for short-term leases. During the three months ended March 31, 2024 and 2023, all charter-in agreements for third-party vessels were less than twelve months and considered short-term leases.

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13 – STOCK-BASED COMPENSATION

2015 Equity Incentive Plan

Stock Options

The following table summarizes the stock option activity for the three months ended March 31, 2024:


		Weighted		Weighted
	Number	Average		Average
	of	Exercise		Fair
	Options	Price		Value
Outstanding as of January 1, 2024	368,190	$	7.93	$	2.82
Granted	—		—		—
Exercised	(65,245)		8.03		3.09
Forfeited	—		—		—

Outstanding as of March 31, 2024	302,945	$	7.91	$	2.76

Exercisable as of March 31, 2024	302,945	$	7.91	$	2.76

The following table summarizes certain information about the options outstanding as of March 31, 2024:

Options Outstanding and Unvested,

Options Outstanding and Exercisable,

March 31, 2024

Weighted

Average

Weighted

Average

Weighted

Average

Exercise Price of

Average

Remaining

Average

Remaining

Outstanding

Number of

Exercise

Contractual

Number of

Exercise

Contractual

Options

Price

Life

Options

Price

Life

7.91

—

302,945

7.91

2.13

As of March 31, 2024 and December 31, 2023, a total of 302,945 and 368,190 stock options were outstanding, respectively.

There was no remaining unamortized stock-based compensation as of March 31, 2024.

For the three months ended March 31, 2024 and 2023, the Company recognized amortization expense of the fair value of its stock options, which is included in General and administrative expenses, as follows:


	For the Three Months Ended
	March 31,
	2024		2023
General and administrative expenses	$	6	$	42

Restricted Stock Units

The Company has granted restricted stock units (“RSUs”) under the Company’s 2015 Equity Incentive Plan, as amended (the “2015 Plan”), to certain members of the Board of Directors and certain executives and employees of the

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Company, which represent the right to receive a share of common stock, or in the sole discretion of the Company’s Compensation Committee, the value of a share of common stock on the date that the RSU vests. As of March 31, 2024 and December 31, 2023, 974,823 and 808,880 shares of the Company’s common stock were outstanding in respect of the RSUs, respectively. Such shares will only be issued in respect to vested RSUs issued to directors when the director’s service with the Company as a director terminates. Such shares of common stock will only be issued to executives and employees when their RSUs vest under the terms of their grant agreements and the 2015 Plan.

The RSUs that have been issued to certain members of the Board of Directors generally vest on the date of the annual shareholders meeting of the Company following the date of the grant. In lieu of cash dividends issued for vested and nonvested shares held by certain members of the Board of Directors, the Company will grant additional vested and nonvested RSUs, respectively, which are calculated by dividing the amount of the dividend by the closing price per share of the Company’s common stock on the dividend payment date and will have the same terms as other RSUs issued to members of the Board of Directors. The RSUs that have been issued to other individuals vest in equal installments on each of the anniversaries of the determined vesting date, over the three or five year vesting periods, as applicable.

The table below summarizes the Company’s unvested RSUs for the three months ended March 31, 2024:


		Weighted
	Number of	Average Grant
	RSUs	Date Price
Outstanding as of January 1, 2024	563,705	$	16.47
Granted	174,692		18.27
Vested	(171,336)		16.34
Forfeited	—		—

Outstanding as of March 31, 2024	567,061	$	17.06

The total fair value of the RSUs that vested during the three months ended March 31, 2024 and 2023 was $3,410 and $3,369, respectively. The total fair value is calculated as the number of shares vested during the period multiplied by the fair value on the vesting date.

The following table summarizes certain information of the RSUs unvested and vested as of March 31, 2024:


Unvested RSUs				Vested RSUs
March 31, 2024				March 31, 2024
			Weighted
	Weighted		Average		Weighted
	Average		Remaining		Average
Number of	Grant Date		Contractual	Number of	Grant Date
RSUs	Price		Life	RSUs	Price
567,061	$	17.06	1.93	296,175	$	12.53

The Company is amortizing these grants over the applicable vesting periods, net of anticipated forfeitures. As of March 31, 2024, unrecognized compensation cost of $6,110 related to RSUs will be recognized over a weighted-average period of 1.93 years.

For the three months ended March 31, 2024 and 2023, the Company recognized nonvested stock amortization expense for the RSUs, which is included in General and administrative expenses as follows:



	For the Three Months Ended
	March 31,
	2024		2023
General and administrative expenses	$	1,154	$	1,517

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Performance-Based Restricted Stock Units

The Company has granted performance-based restricted stock units (“PRSUs”) under the 2015 Plan to certain employees of the Company, some of which are contingent upon the Company’s relative total shareholder return (“TSR”) and some of which are contingent upon the Company’s return on invested capital (”ROIC”) for a three-year performance period ending December 31, 2025 and December 31, 2026.

The TSR is calculated based on the Company’s total shareholder return compared to that of certain peer companies specified in the award agreements over the performance period and is calculated based on the change in the average daily closing stock price over a 20 trading-day period from the beginning to the end of the performance period, including reinvested dividends. The total quantity of PRSUs eligible to vest under these awards range from zero to 200% of the target based on actual relative TSR performance during the performance period. The grant date fair value of the TSR awards was estimated using a Monte Carlo simulation model. Compensation for these awards, which are subject to market conditions, is being amortized over the service period.

The grant date fair value of the ROIC awards was estimated using the closing share price of the Company’s stock on the date of grant. The total quantity of PRSUs eligible to vest under these awards range from zero to 200% of the target based on actual ROIC performance during the performance period. As such ROIC awards are subject to performance conditions and compensation cost is recognized over the service period based on the amount of awards that the Company believes is probable that will vest. To the extent the Company’s estimate changes, the Company will recognize a cumulative catch up in subsequent reporting periods.

The table below summarizes the Company’s unvested PRSUs for the three months ended March 31, 2024:



		Number of
		PRSUs
Outstanding as of January 1, 2024		79,838
Granted		99,065
Vested		—
Forfeited		—

Outstanding as of March 31, 2024		178,903

The PRSUs, if earned, will ordinarily vest during the first quarter after the three-year performance period and the recipient will receive a share of common stock for each earned PRSU. If 100% of the target metric is achieved, the recipient will earn 100% of the target amount of the PRSUs originally granted. However, based on actual performance, the number of PRSUs earned will change based on the ranges described above. As of March 31, 2024, unrecognized compensation cost of $3,040 related to PRSUs will be recognized over a weighted-average period of 2.31 years.

Significant inputs used in the estimation of the fair value of these awards outstanding as of March 31, 2024 and December 31, 2023 are as follows:


Significant Input	March 31, 2024	December 31, 2023
Closing share price of our common stock	$14.36 to $18.17	$14.36 to $16.30
Risk-free rate of return	3.81% to 4.38%	3.81% to 4.38%
Expected volatility of our common stock	48.34% to 54.53%	53.38% to 54.53%
Holding period discount	0%	0%
Simulation term (in years)	2.54 to 2.86	2.54 to 2.72
Range of target	0% to 200%	0% to 200%

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For the three months ended March 31, 2024 and 2023, the Company recognized nonvested stock amortization expense for the PRSUs, which is included in General and administrative expenses as follows:


	For the Three Months Ended
	March 31,
	2024		2023
General and administrative expenses	$	222	$	—

14 – LEGAL PROCEEDINGS

On December 14, 2022, a sub-charterer of the Genco Constellation asserted a claim for monetary losses in connection with alleged delays of the loading of their cargo, short loading, or both at the port of Longkou, China. Hizone Group Co. Ltd (“Hizone”) had sub-chartered the vessel from SCM Corporation Limited, which had subchartered the vessel from BG Shipping Co. Limited, which in turn had chartered the vessel from the Company. A dispute arose due to the need to restow the cargo to ensure the safety of the crew and the vessel. Following the vessel’s arrival at Tema Harbour in Ghana, Hizone petitioned the Superior Court of Judicature to have the vessel arrested in connection with a claim alleging damages. The petition was granted on December 14, 2022 and although the Company offered security to release the vessel shortly thereafter, the vessel was only released at the end of February 2023. Moreover, Hizone petitioned the Superior Court of Judicature to have the vessel arrested again on February 2, 2023 on an allegedly different claim. The vessel was not generating revenue while it was subject to arrest. The Company vigorously defended them while continuing to seek reimbursement of damages arising from the arrest of the vessel, including the recovery of lost revenue while arrested and reimbursement of legal fees. The Company obtained security from BG Shipping Co. Limited and proceeded with arbitration. During the first quarter of 2024, the Company settled all disputes and claims pertaining to this matter by entering into settlement agreements with the opposing parties. Under the settlement terms, the Company was reimbursed for damages the Company sustained because of the arrest of the Genco Constellation (including contractual revenue and affiliated expenses) as well as for the ensuing legal and security fees and costs the Company has incurred in order to defend against the claims brought by the other parties.

From time to time, the Company may be subject to other legal proceedings and claims in the ordinary course of its business, principally personal injury and property casualty claims. Such claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources. The Company is not aware of any such legal proceedings or claims that it believes will have, individually or in the aggregate, a material effect on the Company, its financial condition, results of operations or cash flows.

15 – SUBSEQUENT EVENTS

On April 2, 2024, the Company completed the sale of the Genco Maximus, a 2009-built Capesize vessel, to a third party for $22,800 less 2.0% commission payable to a third party. The vessel asset for the Genco Maximus has been classified as held for sale in the Condensed Consolidated Balance Sheet as of March 31, 2024 at its estimated net realizable value pursuant to the original sales agreement that was cancelled on February 24, 2024. This vessel served as collateral under the $500 Million Revolver.

On April 22, 2024, the Company completed the sale of the Genco Claudius, a 2010-built Capesize vessel, to a third party for $24,200 less 2.0% commission payable to a third party. The vessel asset for the Genco Claudius has been classified as held for sale in the Condensed Consolidated Balance Sheet as of March 31, 2024 at its estimated net realizable value pursuant to the original sales agreement that was cancelled on February 24, 2024. This vessel served as collateral under the $500 Million Revolver.

The Company expects to record a gain on the sale of the Genco Maximus and Genco Claudius of approximately $9 to $10 million during the second quarter of 2024.

On April 9, 2024 and April 30, 2024, the Company made voluntary debt prepayments of $25,000 and $30,000, respectively, under the $500 Million Revolver.

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On May 8, 2024, the Company announced a regular quarterly dividend of $0.42 per share to be paid on or about May 30, 2024 to shareholders of record as of May 22, 2024. The aggregate amount of the dividend is expected to be approximately $18.3 million, which the Company anticipates will be funded from cash on hand at the time the payment is to be made.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as “anticipate,” “budget”, “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of potential future events, circumstances or future operating or financial performance. These forward-looking statements are based on our management’s current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: (i) declines or sustained weakness in demand in the drybulk shipping industry; (ii) weakness or declines in drybulk shipping rates; (iii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iv) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (v) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (vi) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, lube oil, bunkers, repairs, maintenance, general and administrative expenses, and management expenses; (vii) whether our insurance arrangements are adequate; (viii) changes in general domestic and international political conditions; (ix) acts of war, terrorism, or piracy, including without limitation the ongoing war in Ukraine, the Israel-Hamas war, and attacks on vessels in the Red Sea; (x) changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (xi) the Company’s acquisition or disposition of vessels; (xii) the amount of offhire time needed to complete maintenance, repairs, and installation of equipment to comply with applicable regulations on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims, including offhire days; (xiii) the completion of definitive documentation with respect to charters; (xiv) charterers’ compliance with the terms of their charters in the current market environment; (xv) the extent to which our operating results are affected by weakness in market conditions and freight and charter rates; (xvi) our ability to maintain contracts that are critical to our operation, to obtain and maintain acceptable terms with our vendors, customers and service providers and to retain key executives, managers and employees; (xvii) completion of documentation for vessel transactions and the performance of the terms thereof by buyers or sellers of vessels and us; (xviii) the relative cost and availability of low sulfur and high sulfur fuel, worldwide compliance with sulfur emissions regulations that took effect on January 1, 2020 and our ability to realize the economic benefits or recover the cost of the scrubbers we have installed; (xix) our financial results for the year ending December 31, 2024 and other factors relating to determination of the tax treatment of dividends we have declared; (xx) the financial results we achieve for each quarter that apply to the formula under our dividend policy, including without limitation the actual amounts earned by our vessels and the amounts of various expenses we incur, as a significant decrease in such earnings or a significant increase in such expenses may affect our ability to carry out our new value strategy; (xxi) the exercise of the discretion of our Board regarding the declaration of dividends, including without limitation the amount that our Board determines to set aside for reserves under our dividend policy; (xxii) outbreaks of disease such as the COVID-19 pandemic; and (xxiii) other factors listed from time to time in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2023 and subsequent reports on Form 8-K and Form 10-Q. Our ability to pay dividends in any period will depend upon various factors, including the limitations under any credit agreements to which we may be a party, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance, market developments, and the best interests of the Company and its shareholders. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The following management’s discussion and analysis should be read in conjunction with our historical consolidated financial statements and the related notes included in this Form 10-Q.

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General

We are a New York City-based company incorporated in the Marshall Islands that transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes through the ownership and operation of drybulk vessels. Our fleet currently consists of 43 drybulk vessels, including 16 Capesize, 15 Ultramax and twelve Supramax vessels, with an aggregate carrying capacity of approximately 4,490,000 deadweight tons (“dwt”) and an average age of approximately 11.8 years. We seek to deploy our vessels on time charters, spot market voyage charters, spot market-related time charters or in vessel pools trading in the spot market, to reputable charterers.

See pages 31 – 32 for a table of our current fleet.

Our approach towards fleet composition is to own a high-quality fleet of vessels focused on Capesize, Ultramax and Supramax vessels. Capesize vessels represent our major bulk vessel category, while Ultramax and Supramax vessels represent our minor bulk vessel category. Our major bulk vessels are primarily used to transport iron ore, coal and bauxite, while our minor bulk vessels are primarily used to transport grains, steel products and other drybulk cargoes such as cement, scrap, fertilizer, nickel ore, salt and sugar. This approach of owning ships that transport both major and minor bulk commodities provide us with exposure to a wide range of drybulk trade flows. We employ an active commercial strategy which consists of a global team located in the U.S., Copenhagen and Singapore. Overall, we utilize a portfolio approach to revenue generation through a combination of short-term, spot market employment, index-linked time charters as well as opportunistically booking longer term fixed-rate coverage. Our fleet deployment strategy currently is weighted towards short-term fixtures, which provides us with optionality on our sizeable fleet. However, depending on market conditions, we may seek to enter into additional longer term time charter contracts or contracts of affreightment. In addition to both short and long-term time charters, we fix our vessels on spot market voyage charters as well as spot market-related time charters depending on market conditions and management’s outlook.

Our approach to capital allocation, through the implementation of our value strategy in April 2021, focuses on three key factors:

●

Compelling dividends,

●

Financial deleveraging, and

●

Accretive growth of our fleet

Since 2021, we have executed this strategy by reducing our debt by $279.2 million cumulatively through March 31, 2024 while expanding our core Capesize and Ultramax fleet. This has resulted in a debt balance of $170.0 million as of March 31, 2024, a 62% reduction from January 1, 2021 levels. After voluntary debt prepayments of $25.0 million and $30.0 million on April 9, 2024 and April 30, 2024, respectively, our debt balance was reduced to $115.0 million. These actions have enabled us to further reduce our cash flow breakeven rate positioning us to pay sizeable quarterly dividends across diverse market environments. In addition to the $48.7 million of cash on our balance sheet as of March 31, 2024, we have undrawn revolver availability of $298.9 million, bringing our total liquidity to $347.6 million. Furthermore, since the fourth quarter of 2021 through the first quarter of 2024, we have declared cumulative dividends under our value strategy of $4.52 per share.

IMO 2023 Compliance

In 2021, Genco initiated a comprehensive plan to comply with upcoming International Maritime Organization (“IMO”) regulations that took effect in 2023, namely the Energy Efficiency Existing Ship Index (“EEXI”) and the Carbon Intensity Indicator (“CII”) metrics, which call for a reduction in vessel greenhouse gas emissions. These metrics are intended to assess and measure the energy efficiency of all ships and these new regulations set required attainment values, with the goal of reducing the carbon intensity of international shipping.

We have invested and plan to continue to invest in energy conservation programs to install various energy-saving devices, or ESDs, high performance paint systems, upgrade propellers among other initiatives on select vessels in

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our fleet. We began installing these ESDs on certain ships that entered drydocking in 2022, and we plan to continue to invest in our fleet.

IMO 2030 to 2050 Guidelines

In July 2023, the Marine Environment Protection Committee, a sub-committee of the IMO, focused on medium to long term decarbonization targets for the shipping industry. New targets for greenhouse gas emissions reductions as compared to 2008 levels are below which are to be reviewed every five years:

●

2030: 20% reduction while striving for 30%

●

2040: 70% reduction while striving for 80%

●

2050: net zero at or around 2050

Vessel Sales and Acquisitions

On October 10, 2023 and November 14, 2023, we entered into agreements to acquire two 2016-built 181,000 dwt Capesize vessels, the Genco Ranger and Genco Reliance, respectively. The purchase price of the Genco Ranger and Genco Reliance were $43.1 million and $43.0 million, respectively, and the vessels were delivered on November 27, 2023 and November 21, 2023, respectively. We drew down a total of $65 million on our revolving credit facility under the $450 Million Credit Facility during the fourth quarter of 2023 and utilized cash on hand to finance the purchases.

In order to opportunistically renew our fleet, in addition to the above vessel purchases, we agreed to divest three older, less fuel efficient vessels with their third special survey due in 2024. During the fourth quarter of 2023, we entered into agreements to sell three of our Capesize vessels, the Genco Claudius, Genco Commodus and Genco Maximus. The Genco Commodus was delivered to its third-party buyer on February 7, 2024. On February 24, 2024, we terminated the agreements to sell the Genco Claudius and the Genco Maximus due to the buyers’ breach of the agreements’ terms. During the first quarter of 2024 we commenced arbitration with the buyers , seeking a declaration that we validly terminated the agreements due to the buyers’ breach, and to retain the deposits paid by the buyers in connection with the sales, totaling approximately $3.7 million. During the second quarter of 2024, we and the buyers reached an agreement in principle to settle this matter and conclude the arbitration proceeding in exchange for the buyers releasing the deposits to us. On March 1, 2024, the Company entered into new agreements to sell the Genco Claudius and Genco Maximus to a separate unaffiliated third-party buyer for an aggregate purchase price of $47,000 less a 2.0% commission payable to a third party. The sales of the Genco Claudius and Genco Maximus were completed on April 22, 2024 and April 2, 2024, respectively.

We will continue to seek opportunities to renew our fleet going forward.

Our Operations

We report financial information and evaluate our operations by charter revenues and not by the length of ship employment for our customers, i.e., spot or time charters. Each of our vessels serves the same type of customer, has similar operations and maintenance requirements, operates in the same regulatory environment, and is subject to similar economic characteristics. Based on this, we have determined that we operate in one reportable segment in which we are engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk carrier vessels.

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Our management team and our other employees are responsible for the commercial and strategic management of our fleet. Commercial management includes the negotiation of charters for vessels, managing the mix of various types of charters, such as time charters, spot market voyage charters and spot market-related time charters, and monitoring the performance of our vessels under their charters. Strategic management includes locating, purchasing, financing and selling vessels. Technical management involves the day-to-day management of vessels, including performing routine maintenance, attending to vessel operations and arranging for crews and supplies. Our technical management joint venture, GS Shipmanagement Pte. Ltd. (“GSSM”), and Synergy Marine Pte. Ltd. currently provide the technical management to the vessels in our fleet and members of our New York City-based management team oversee their activities.

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Factors Affecting Our Results of Operations

We believe that the following table reflects important measures for analyzing trends in our results of operations. The table reflects our ownership days, chartered-in days, available days, operating days, fleet utilization, TCE rates and daily vessel operating expenses for the three months ended March 31, 2024 and 2023 on a consolidated basis.


	For the Three Months Ended
	March 31,						Increase
	2024			2023			(Decrease)			% Change
Fleet Data:
Ownership days (1)
Capesize		1,675.4			1,530.0			145.4		9.5	%
Panamax		—			—			—		—	%
Ultramax		1,365.0			1,350.0			15.0		1.1	%
Supramax		1,092.0			1,080.0			12.0		1.1	%

Total		4,132.4			3,960.0			172.4		4.4	%

Chartered-in days (2)
Capesize		—			—			—		—	%
Panamax		25.9			—			25.9		100.0	%
Ultramax		87.6			189.5			(101.9)		(53.8)	%
Supramax		82.3			46.2			36.1		78.1	%

Total		195.8			235.7			(39.9)		(16.9)	%

Available days (owned & chartered-in fleet) (3)
Capesize		1,618.5			1,440.7			177.8		12.3	%
Panamax		25.9			—			25.9		100.0	%
Ultramax		1,410.2			1,534.5			(124.3)		(8.1)	%
Supramax		1,134.3			1,089.1			45.2		4.2	%

Total		4,188.9			4,064.3			124.6		3.1	%

Available days (owned fleet) (4)
Capesize		1,618.5			1,440.7			177.8		12.3	%
Panamax		—			—			—		—	%
Ultramax		1,322.6			1,345.0			(22.4)		(1.7)	%
Supramax		1,052.0			1,042.9			9.1		0.9	%

Total		3,993.1			3,828.6			164.5		4.3	%

Operating days (5)
Capesize		1,572.8			1,434.1			138.7		9.7	%
Panamax		25.9			—			25.9		100.0	%
Ultramax		1,393.1			1,473.2			(80.1)		(5.4)	%
Supramax		1,122.7			1,072.0			50.7		4.7	%

Total		4,114.5			3,979.3			135.2		3.4	%

Fleet utilization (6)
Capesize		93.9	%		98.6	%		(4.7)	%	(4.8)	%
Panamax		100.0	%		—	%		100.0	%	100.0	%
Ultramax		98.1	%		95.7	%		2.4	%	2.5	%
Supramax		97.3	%		95.4	%		1.9	%	2.0	%

Fleet average		96.2	%		96.6	%		(0.4)	%	(0.4)	%

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	For the Three Months Ended
	March 31,				Increase
	2024		2023		(Decrease)		% Change
Average Daily Results:
Time Charter Equivalent (7)
Capesize	$	25,601	$	15,929	$	9,672	60.7	%
Panamax		—		—		—	—	%
Ultramax		14,572		14,890		(318)	(2.1)	%
Supramax		15,339		10,010		5,329	53.2	%

Fleet average		19,219		13,947		5,272	37.8	%
Major bulk vessels		25,601		15,929		9,672	60.7	%
Minor bulk vessels		14,871		12,752		2,119	16.6	%

Daily vessel operating expenses (8)
Capesize	$	6,700	$	6,571	$	129	2.0	%
Panamax		—		—		—	—	%
Ultramax		5,915		5,559		356	6.4	%
Supramax		6,074		6,329		(255)	(4.0)	%

Fleet average		6,275		6,160		115	1.9	%

Definitions

In order to understand our discussion of our results of operations, it is important to understand the meaning of the following terms used in our analysis and the factors that influence our results of operations.

(1) Ownership days. We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.

(2) Chartered-in days. We define chartered-in days as the aggregate number of days in a period during which we chartered-in third-party vessels.

(3) Available days (owned and chartered-in fleet). We define available days as the number of our ownership days and chartered-in days less the aggregate number of days that our vessels are off-hire due to familiarization upon acquisition, repairs or repairs under guarantee, vessel upgrades or special surveys. Companies in the shipping industry generally use available days to measure the number of days in a period during which vessels should be capable of generating revenues.

(4) Available days (owned fleet). We define available days for the owned fleet as available days less chartered-in days.

(5) Operating days. We define operating days as the number of our total available days in a period less the aggregate number of days that our vessels are off-hire due to unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.

(6) Fleet utilization. We calculate fleet utilization as the number of our operating days during a period divided by the number of ownership days plus chartered-in days less drydocking days.

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(7) Time charter equivalent. We define time charter equivalent (“TCE”) rates as our voyage revenues less voyage expenses, charter-hire expenses and realized gains or losses on fuel hedges, divided by the number of the available days of our owned fleet during the period. TCE rate is a common shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charterhire rates for vessels on voyage charters are generally not expressed in per-day amounts while charterhire rates for vessels on time charters generally are expressed in such amounts.


	Entire Fleet				Major Bulk				Minor Bulk
	For the Three Months Ended				For the Three Months Ended				For the Three Months Ended
	March 31,				March 31,				March 31,
	2024		2023		2024		2023		2024		2023
Voyage revenues (in thousands)	$	117,435	$	94,391	$	62,022	$	39,620	$	55,413	$	54,771
Voyage expenses (in thousands)		37,200		37,435		20,588		16,670		16,612		20,765
Charter hire expenses (in thousands)		3,510		3,664		—		—		3,510		3,664
Realized gain on fuel hedges (in thousands)		18		108		—		—		18		108
		76,743		53,400		41,434		22,950		35,309		30,450
Total available days for owned fleet		3,993		3,829		1,618		1,441		2,374		2,388
Total TCE rate	$	19,219	$	13,947	$	25,601	$	15,929	$	14,871	$	12,752

(8) Daily vessel operating expenses. We define daily vessel operating expenses to include crew wages and related costs, the cost of insurance expenses relating to repairs and maintenance (excluding drydocking), the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses. Daily vessel operating expenses are calculated by dividing vessel operating expenses by ownership days for the relevant period.

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Operating Data

The following tables represent the operating data for the three months ended March 31, 2024 and 2023 on a consolidated basis.


	For the Three Months Ended
	March 31,
	2024		2023		Change		% Change

	(U.S. dollars in thousands, except for per share amounts)
Revenue:
Voyage revenues	$	117,435	$	94,391	$	23,044	24.4	%

Total revenues		117,435		94,391		23,044	24.4	%

Operating Expenses:
Voyage expenses		37,200		37,435		(235)	(0.6)	%
Vessel operating expenses		25,932		24,393		1,539	6.3	%
Charter hire expenses		3,510		3,664		(154)	(4.2)	%
General and administrative expenses (inclusive of nonvested stock amortization expense of $1,382 and $1,559, respectively)		7,664		7,750		(86)	(1.1)	%
Technical management expenses		1,031		762		269	35.3	%
Depreciation and amortization		17,223		15,944		1,279	8.0	%
Loss on sale of vessels		978		—		978	100.0	%
Other operating expense		1,804		—		1,804	100.0	%

Total operating expenses		95,342		89,948		5,394	6.0	%

Operating income		22,093		4,443		17,650	397.3	%
Other expense, net		(3,150)		(1,583)		(1,567)	99.0	%

Net income	$	18,943	$	2,860	$	16,083	562.3	%
Less: Net income attributable to noncontrolling interest		145		226		(81)	(35.8)	%
Net income attributable to Genco Shipping & Trading Limited	$	18,798	$	2,634	$	16,164	613.7	%

Earnings per share - basic	$	0.44	$	0.06	$	0.38	633.3	%
Earnings per share - diluted	$	0.43	$	0.06	$	0.37	616.7	%
Weighted average common shares outstanding - basic		42,918,248		42,632,059		286,189	0.7	%
Weighted average common shares outstanding - diluted		43,606,580		43,097,362		509,218	1.2	%

EBITDA (1)	$	39,237	$	19,837	$	19,400	97.8	%

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(1)

EBITDA represents net income attributable to Genco Shipping & Trading Limited plus net interest expense, taxes and depreciation and amortization. EBITDA is included because it is used by management and certain investors as a measure of operating performance. EBITDA is used by analysts in the shipping industry as a common performance measure to compare results across peers. Our management uses EBITDA as a performance measure in our consolidated internal financial statements, and it is presented for review at our board meetings. We believe that EBITDA is useful to investors as the shipping industry is capital intensive which often results in significant depreciation and cost of financing. EBITDA presents investors with a measure in addition to net income to evaluate our performance prior to these costs. EBITDA is not an item recognized by U.S. GAAP (i.e., non-GAAP measure) and should not be considered as an alternative to net income, operating income or any other indicator of a company’s operating performance required by U.S. GAAP. EBITDA is not a measure of liquidity or cash flows as shown in our Condensed Consolidated Statements of Cash Flows. The definition of EBITDA used here may not be comparable to that used by other companies. The following table demonstrates our calculation of EBITDA and provides a reconciliation of EBITDA to net income attributable to Genco Shipping & Trading Limited for each of the periods presented above:


	For the Three Months Ended
	March 31,
	2024		2023
Net income attributable to Genco Shipping & Trading Limited	$	18,798	$	2,634
Net interest expense		3,216		1,259
Income tax expense		—		—
Depreciation and amortization		17,223		15,944

EBITDA (1)	$	39,237	$	19,837

Results of Operations

The following table sets forth information about the most recent employment of the vessels in our fleet as of May 7, 2024:


	Year	Charter
Vessel	Built	Expiration(1)	Cash Daily Rate(2)

Capesize Vessels
Genco Augustus	2007	April 2024	Voyage
Genco Tiberius	2007	May 2024	Voyage
Genco London	2007	May 2024	Voyage
Genco Titus	2007	July 2024	Voyage
Genco Constantine	2008	June 2024	Voyage
Genco Hadrian	2008	April 2024	Voyage
Genco Tiger	2011	July 2024	Voyage
Genco Lion	2012	May 2024	Voyage
Baltic Bear	2010	April 2024	Voyage
Baltic Wolf	2010	May 2024	Voyage
Genco Resolute	2015	July 2024	127% of BCI (3)
Genco Endeavour	2015	June 2024	Voyage
Genco Defender	2016	July 2024	125% of BCI (3)
Genco Liberty	2016	February 2025	$35,000
Genco Ranger	2016	February 2025	128% of BCI (3)
Genco Reliance	2016	January 2025	128% of BCI (3)

Ultramax Vessels
Baltic Hornet	2014	May 2024	$27,000
Baltic Wasp	2015	May 2024	Voyage
Baltic Scorpion	2015	May 2024	Voyage
Baltic Mantis	2015	May 2024	$20,500

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	Year	Charter
Vessel	Built	Expiration(1)	Cash Daily Rate(2)

Genco Weatherly	2014	June 2024	$13,500
Genco Columbia	2016	June 2024	$22,500
Genco Magic	2014	April 2024	Voyage
Genco Vigilant	2015	June 2024	$19,000
Genco Freedom	2015	May 2024	Voyage
Genco Enterprise	2016	June 2024	Voyage
Genco Constellation	2017	May 2024	$16,000
Genco Madeleine	2014	June 2024	$22,250
Genco Mayflower	2017	May 2024	$22,000
Genco Mary	2022	May 2024	$23,000
Genco Laddey	2022	May 2024	$18,000

Supramax Vessels
Genco Predator	2005	May 2024	Voyage
Genco Warrior	2005	June 2024	$21,000
Genco Hunter	2007	May 2024	$19,000
Genco Aquitaine	2009	June 2024	$13,000
Genco Ardennes	2009	May 2024	$20,500
Genco Auvergne	2009	July 2024	$21,500
Genco Bourgogne	2010	July 2024	$13,500
Genco Brittany	2010	June 2024	$18,500
Genco Languedoc	2010	May 2024	$14,500
Genco Picardy	2005	June 2024	$16,750
Genco Pyrenees	2010	May 2024	Voyage
Genco Rhone	2011	June 2024	$17,500

(1)

The charter expiration dates presented represent the earliest dates that our charters may be terminated in the ordinary course. Under the terms of certain contracts, the charterer is entitled to extend the time charter from two to four months in order to complete the vessel's final voyage plus any time the vessel has been off-hire.

(2)	Time charter rates presented are the gross daily charterhire rates before third-party brokerage commission generally ranging from 1.25% to 6.25%. In a time charter, the charterer is responsible for voyage expenses such as bunkers, port expenses, agents’ fees and canal dues.

(3)	BCI is the Baltic Capesize Index

Three months ended March 31, 2024 compared to the three months ended March 31, 2023

VOYAGE REVENUES-

For the three months ended March 31, 2024, voyage revenues increased by $23.0 million, or 24.4%, to $117.4 million as compared to $94.4 million for the three months ended March 31, 2023. The increase in voyage revenues was primarily due to higher rates earned by our major bulk vessels. In the first quarter of 2024, the drybulk market remained at firm levels following a strong end to 2023 led by increased Brazilian iron ore exports, as well as solid coal and bauxite trades together with continued commodity demand from China.

The average TCE rate of our overall fleet increased 37.8% to $19,219 a day during the first quarter of 2024 from $13,947 a day during the first quarter of 2023. The TCE for our major bulk vessels increased by 60.7% from $15,929 a day during the first quarter of 2023 to $25,601 a day during the first quarter of 2024. This increase was primarily a result of higher rates achieved by our Capesize vessels. The TCE for our minor bulk vessels increased by 16.6% from $12,752 a day during the first quarter of 2023 to $14,871 a day during the first quarter of 2024, primarily a result of higher rates achieved by our Supramax vessels.

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Fleet utilization decreased marginally from 96.6% during the first quarter of 2023 to 96.2% during the first quarter of 2024.

VOYAGE EXPENSES-

In time charters and spot market-related time charters, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. These expenses are borne by the Company during spot market voyage charters. There are certain other non-specified voyage expenses such as commissions, which are typically borne by us. Voyage expenses include port and canal charges, fuel (bunker) expenses and brokerage commissions payable to unaffiliated third parties. Port and canal charges and bunker expenses primarily increase in periods during which vessels are employed on spot market voyage charters because these expenses are for the account of the vessel owner. At the inception of a time charter, we record the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer as a gain or loss within voyage expenses. Voyage expenses also include the cost of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement. Additionally, we may record lower of cost and net realizable value adjustments to re-value the bunker fuel on a quarterly basis for certain time charter agreements where the inventory is subject to gains and losses. Refer to Note 2 — Summary of Significant Accounting Policies in our Condensed Consolidated Financial Statements.

Voyage expenses decreased marginally from $37.4 million during the three months ended March 31, 2023 to $37.2 million during the three months ended March 31, 2024.

VESSEL OPERATING EXPENSES-

Vessel operating expenses increased by $1.5 million from $24.4 million during the three months ended March 31, 2023 to $25.9 million during the three months ended March 31, 2024. The increase was primarily due to the operation of a larger fleet during the first quarter of 2024 as compared to the first quarter of 2023, as well as the timing of the purchase of stores and higher repair and maintenance costs.

Average daily vessel operating expenses (“DVOE”) for our fleet increased to $6,275 per vessel per day for the three months ended March 31, 2024 from $6,160 per day for the three months ended March 31, 2023. The increase in daily vessel operating expense was primarily due to the timing of the purchase of stores and higher repair and maintenance costs. We believe daily vessel operating expenses are best measured for comparative purposes over a 12-month period in order to take into account all of the expenses that each vessel in our fleet will incur over a full year of operation.

The DVOE budget for the second quarter of 2024 is expected to be $6,350 per vessel per day on a fleet-wide basis, primarily due to the timing of expenses. The potential impacts of various macroeconomic events, including but not limited to the war in Ukraine, the Israel-Hamas war and the Houthi conflict in the Red Sea, are unpredictable, and the actual amount of our DVOE could be higher or lower than budgeted as a result.

Our vessel operating expenses increase to the extent our fleet expands. Other factors beyond our control, some of which may affect the shipping industry in general, including, for instance, developments relating to market prices for crewing, lubes, and insurance, may also cause these expenses to increase. Crew costs on our vessels could increase in the future due to higher wages as a result of the potential impact of the war in Ukraine, the Israel-Hamas war, and the Houthi conflict in the Red Sea among other potential macroeconomic events, are unpredictable, and the actual amount of our DVOE could be higher or lower than budgeted as a result.

CHARTER HIRE EXPENSES-

Charter hire expenses decreased marginally by $0.2 million from $3.7 million during the three months ended March 31, 2023 to $3.5 million during the three months ended March 31, 2024. The decrease was primarily due to a decrease in chartered-in days.

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GENERAL AND ADMINISTRATIVE EXPENSES-

We incur general and administrative expenses that relate to our onshore non-vessel-related activities. Our general and administrative expenses include our payroll expenses, including those relating to our executive officers, operating lease expense, legal, auditing and other professional expenses. General and administrative expenses include nonvested stock amortization expense which represent the amortization of stock-based compensation that has been issued to our Directors and employees pursuant to the 2015 Equity Incentive Plan. Refer to Note 13 — Stock-Based Compensation in our Condensed Consolidated Financial Statements. General and administrative expenses also include legal and professional fees associated with our credit facilities, which are not capitalizable to deferred financing costs. We also incur general and administrative expenses for our overseas offices located in Singapore and Copenhagen.

For the three months ended March 31, 2024 and 2023, general and administrative expenses decreased marginally from $7.8 million during the three months ended March 31, 2023 to $7.7 million during the three months ended March 31, 2024.

TECHNICAL MANAGEMENT EXPENSES-

Technical management expenses include the direct costs incurred by GSSM for the technical management of the vessels under its management. Technical management fees were $1.0 million and $0.8 million during the three months ended March 31, 2024 and 2023, respectively, with the variance due to timing of expenses during the year.

DEPRECIATION AND AMORTIZATION-

Depreciation and amortization expense increased by $1.3 million to $17.2 million during the three months ended March 31, 2024 as compared to $15.9 million during the three months ended March 31, 2023. This increase was primarily due to an increase in drydocking amortization expense for certain vessels that completed their respective drydockings during 2023.

LOSS ON SALE OF VESSELS-

During the first quarter of 2024, we recorded a net loss on sale of vessels of $1.0 million related primarily to the sale of the Genco Commodus during the first quarter of 2024. There were no vessels sold during the first quarter of 2023.

OTHER OPERATING EXPENSE-

Other operating expense of $1.8 million recorded during the three months ended March 31, 2024 consists of costs incremental to routine expenses that were incurred related to our 2024 annual meeting to be held on May 23, 2024. Additionally, we expect to incur approximately $4.5 million of such incremental costs during the second quarter of 2024.

OTHER INCOME (EXPENSE)-

INTEREST EXPENSE –

Interest expense increased from $2.0 million during the three months ended March 31, 2023 to $4.0 million during the three months ended March 31, 2024. Interest expense during the three months ended March 31, 2024 and 2023 consisted primarily of interest expense under our credit facilities and amortization of deferred financing costs for those facilities. The increase was primarily a result of lower settlement payments received under our interest rate cap agreements as a result of the expiration of these agreements, as well as higher interest rates and average outstanding debt during the first quarter of 2024 as compared to the first quarter of 2023.

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INTEREST INCOME –

Interest income increased by approximately $0.1 million from $0.8 million during the three months ended March 31, 2023 to $0.8 million during the three months ended March 31, 2024 primarily due to higher interest income earned on our cash and cash equivalents.

OTHER INCOME (EXPENSE) –

Other income (expense) fluctuated by $0.4 million from $0.3 million of other expense during three months ended March 31, 2023 to $0.1 million of other income during the three months ended March 31, 2024. The fluctuation was primarily due to a decrease in tax related expenses related to our Denmark subsidiary.

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST –

During the three months ended March 31, 2024 and 2023, net income attributable to noncontrolling interest was $0.1 million and $0.2 million, respectively, which is associated with the net income attributable to the noncontrolling interest of GSSM.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash flow from operations, cash on hand, equity offerings and credit facility borrowings. We currently use our funds primarily for the acquisition of vessels, fleet renewal, drydocking for our vessels, payment of dividends, debt repayments and satisfying working capital requirements as may be needed to support our business. Our ability to continue to meet our liquidity needs is subject to and will be affected by cash utilized in operations, the economic or business environment in which we operate, shipping industry conditions, the financial condition of our customers, vendors and service providers, our ability to comply with the financial and other covenants of our indebtedness, and other factors.

We believe, given our current cash holdings, if drybulk shipping rates do not decline significantly from current levels, our capital resources, including cash anticipated to be generated within the year, are sufficient to fund our operations for at least the next twelve months. Such resources include unrestricted cash and cash equivalents of $48.4 million as of March 31, 2024 in addition to the $298.9 availability under the $500 Million Revolver as of March 31, 2024, which compares to a minimum liquidity requirement under our credit facility of approximately $22.5 million as of March 31, 2024. Given anticipated capital expenditures related to drydockings and fuel efficiency upgrade costs of $19.3 million and $40.8 million during the remainder of 2024 and 2025, respectively, as well as any quarterly dividend payments, we anticipate to continue to have significant cash expenditures. Refer to “Capital Expenditures” below for further details. However, if market conditions were to worsen significantly due to the war in Ukraine, the Houthi conflict in the Red Sea, the Israel-Hamas war, or other causes, then our cash resources may decline to a level that may put at risk our ability to pay dividends per our capital allocation strategy or at all.

Throughout 2022, 2023 and the three months ended March 31, 2024, the Company made a total of $141.0 million of voluntary debt prepayments, resulting in a reduced cash flow breakeven rate from previous levels. During the fourth quarter of 2023, partially offsetting this debt reduction, we opportunistically drew down $65 million under the revolver of the $450 Million Credit Facility to partially fund the purchase of two Capesize vessels that were delivered during the fourth quarter of 2023. Going forward, given the nature of our new revolving credit facility, we plan to actively manage our debt balance to reduce interest expense and may also opportunistically draw down debt to assist in funding accretive growth opportunities. As of March 31, 2024, there are no mandatory debt repayments until we must repay $170.0 million in 2028. Although we do not have any mandatory debt repayments until 2028, we intend to continue to pay down debt on a voluntary basis with a medium-term goal of zero net debt.

As of March 31, 2024, the $500 Million Revolver contained collateral maintenance covenants that require the aggregate appraised value of collateral vessels to be at least 140% of the principal amount of the loan outstanding under such facility. If the values of our vessels were to decline as a result of the various geopolitical factors previously mentioned or otherwise, we may not satisfy this collateral maintenance requirement. If we do not satisfy the collateral

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maintenance requirement, we will need to post additional collateral or prepay outstanding loans to bring us back into compliance, or we will need to seek waivers, which may not be available or may be subject to conditions.

In the future, we may require capital to fund acquisitions or to improve or support our ongoing operations and debt structure, particularly in light of economic conditions resulting from the war in Ukraine, the Houthi conflict in the Red Sea, the Israel-Hamas war, and the trajectory of China’s economic recovery. We may from time to time seek to raise additional capital through equity or debt offerings, selling vessels or other assets, pursuing strategic opportunities, or otherwise. We may also from time to time seek to incur additional debt financing from private or public sector sources, refinance our indebtedness or obtain waivers or modifications to our credit agreements to obtain more favorable terms, enhance flexibility in conducting our business, or otherwise. We may also seek to manage our interest rate exposure through hedging transactions. We may seek to accomplish any of these independently or in conjunction with one or more of these actions. However, if market conditions are unfavorable, we may be unable to accomplish any of the foregoing on acceptable terms or at all.

On November 29, 2023, we entered into a fourth amendment to amend, extend and upsize our existing $450 Million Credit Facility and implement the $500 Million Revolver. The amended structure consists of a $500 million revolving credit facility, which can be utilized to support growth of our asset base as well as general corporate purposes. Refer to Note 7 — Debt in our Condensed Consolidated Financial Statements for further details regarding the terms of the $500 Million Revolver, which information is incorporated herein by reference.

As of March 31, 2024, we were in compliance with all financial covenants under the $500 Million Revolver.

Dividends

We disclosed on April 19, 2021 that, on management’s recommendation, our Board of Directors adopted a quarterly dividend policy for dividends payable which commenced in the first quarter of 2022 in respect of our financial results for the fourth quarter of 2021. Under the quarterly dividend policy, the amount available for quarterly dividends is to be calculated based on the following formula:

Operating cash flow

Less: Capital expenditures for drydocking

Less: Voluntary quarterly reserve

Cash flow distributable as dividends

The amount of dividends payable under the foregoing formula for each quarter of the year will be determined on a quarterly basis.

For purposes of the foregoing calculation, operating cash flow is defined as voyage revenue less voyage expenses, charter hire expenses, realized gains or losses on fuel hedges, vessel operating expenses, general and administrative expenses other than non-cash restricted stock expenses, technical management fees, and interest expense other than non-cash deferred financing costs. Anticipated uses for the voluntary quarterly reserve include, but are not limited to, vessel acquisitions, debt prepayments and repayments, and general corporate purposes. In order to set aside funds for these purposes, the voluntary reserve will be set on a quarterly basis in the discretion of our Board and is anticipated to be based on future quarterly debt repayments and interest expense.

On May 8, 2024, we announced a quarterly dividend of $0.42 per share. Our quarterly dividend policy and declaration and payment of dividends are subject to legally available funds, compliance with applicable law and contractual obligations (including our credit facilities) and our Board’s determination that each declaration and payment is at that time in the best interests of the Company and its shareholders after its review of our financial performance.

In connection with our comprehensive value strategy, we have paid down additional indebtedness under our credit facilities.

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The declaration and payment of any dividend or any stock repurchase is subject to the discretion of our Board of Directors. Our Board of Directors and management continue to closely monitor market developments together with the evaluation of our quarterly dividend policy in the current market environment. The principal business factors that our Board of Directors expects to consider when determining the timing and amount of dividend payments or stock repurchases include our earnings, financial condition, and cash requirements at the time. Marshall Islands law generally prohibits the declaration and payment of dividends or stock repurchases other than from surplus. Marshall Islands law also prohibits the declaration and payment of dividends or stock repurchases while a company is insolvent or would be rendered insolvent by the payment of such a dividend or such a stock repurchase. Heightened economic uncertainty and the potential for renewed drybulk market weakness as a result of the war in Ukraine, the Israel-Hamas war, the Houthi conflict in the Red Sea, and related economic conditions may result in our suspension, reduction, or termination of future quarterly dividends.

U.S. Federal Income Tax Treatment of Dividends

U.S. Holders

For purposes of this discussion, the term "U.S. Holder" means a beneficial owner of our common stock that is, for U.S. federal income tax purposes, (i) an individual U.S. citizen or resident, (ii) a corporation that is created or organized in or under the laws of the United States, any state thereof or the District of Columbia, or any other U.S. entity taxable as a corporation, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (iv) a trust if either (x) a court within the United States is able to exercise primary jurisdiction over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (y) the trust has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person. If a partnership, or an entity treated for U.S. federal income tax purposes as a partnership, such as a limited liability company, holds common stock, the tax treatment of a partner will generally depend on the status of the partner and upon the activities of the partnership. If you are a partner in such a partnership holding our common stock, you are encouraged to consult your tax advisor. A beneficial owner of our common stock (other than a partnership) that is not a U.S. Holder is referred to below as a "Non-U.S. Holder."

Subject to the discussion of passive foreign investment company (PFIC) status on pages 36 – 37 in the 2023 10-K, any distributions made by us to a U.S. Holder with respect to our common shares generally will constitute dividends to the extent of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of those earnings and profits will be treated first as a nontaxable return of capital to the extent of the U.S. Holder's tax basis in our common shares (determined on a share-by-share basis), and thereafter as capital gain. U.S. Holders that are corporations for U.S. federal income tax purposes and own at least 10% of our shares may be able to claim a dividends-received-deduction and should consult their tax advisors.

Dividends paid on our common shares to a U.S. Holder who is an individual, trust or estate, or a "non-corporate U.S. Holder," will generally be treated as "qualified dividend income" that is taxable to such non-corporate U.S. Holder at preferential tax rates, provided that (1) our common shares are readily tradable on an established securities market in the United States (such as the NYSE, on which our common shares are traded); (2) we are not a PFIC for the taxable year during which the dividend is paid or the immediately preceding taxable year (which we do not believe we have been, are, or will be); (3) the non-corporate U.S. Holder's holding period of our common shares includes more than 60 days in the 121-day period beginning 60 days before the date on which our common shares becomes ex-dividend; and (4) the non-corporate U.S. Holder is not under an obligation to make related payments with respect to positions in substantially similar or related property. A non-corporate U.S. Holder will be able to take qualified dividend income into account in determining its deductible investment interest (which is generally limited to its net investment income) only if it elects to do so; in such case, the dividend will be taxed at ordinary income rates. Non-corporate U.S. Holders also may be required to pay a 3.8% surtax on all or part of such holder's "net investment income," which includes, among other items, dividends on our shares, subject to certain limitations and exceptions. Investors are encouraged to consult their own tax advisors regarding the effect, if any, of this surtax on their ownership of our shares.

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Amounts taxable as dividends generally will be treated as passive income from sources outside the U.S. However, if (a) we are 50% or more owned, by vote or value, by U.S. Holders and (b) at least 10% of our earnings and profits are attributable to sources within the U.S., then for foreign tax credit purposes, a portion of our dividends would be treated as derived from sources within the U.S. With respect to any dividend paid for any taxable year, the U.S. source ratio of our dividends for foreign tax credit purposes would be equal to the portion of our earnings and profits from sources within the U.S. for such taxable year divided by the total amount of our earnings and profits for such taxable year. The rules related to U.S. foreign tax credits are complex and U.S. Holders should consult their tax advisors to determine whether and to what extent a credit would be available.

Special rules may apply to any "extraordinary dividend" — generally, a dividend in an amount which is equal to or in excess of 10% of a shareholder's adjusted basis (or fair market value in certain circumstances) in a share of our common shares — paid by us. If we pay an "extraordinary dividend" on our common shares that is treated as "qualified dividend income", then any loss derived by a non-corporate U.S. Holder from the sale or exchange of such common shares will be treated as long-term capital loss to the extent of such dividend.

Tax Consequences if We Are a Passive Foreign Investment Company

As discussed in “U.S. tax authorities could treat us as a “passive foreign investment company,” which could have adverse U.S. federal income tax consequences to U.S. shareholders” in Item 1.A Risk Factors in our 2023 10-K, a foreign corporation generally will be treated as a PFIC for U.S. federal income tax purposes if, after applying certain look through rules, either (1) at least 75% of its gross income for any taxable year consists of “passive income” or (2) at least 50% of the average value or adjusted bases of its assets (determined on a quarterly basis) produce or are held for the production of passive income, i.e., “passive assets.” As discussed above, we do not believe that our past or existing operations would cause, or would have caused, us to be deemed a PFIC with respect to any taxable year. No assurance can be given that the IRS or a court of law will accept our position, and there is a risk that the IRS or a court of law could determine that we are a PFIC. Moreover, there can be no assurance that we will not become a PFIC in any future taxable year because the PFIC test is an annual test, there are uncertainties in the application of the PFIC rules, and although we intend to manage our business so as to avoid PFIC status to the extent consistent with our other business goals, there could be changes in the nature and extent of our operations in future taxable years.

If we were to be treated as a PFIC for any taxable year in which a U.S. Holder owns shares of our common stock (and regardless of whether we remain a PFIC for subsequent taxable years), the tax consequences to such a U.S. holder upon the receipt of distributions in respect of such shares that are treated as “excess distributions” would differ from those described above. In general, an excess distribution is the amount of distributions received during a taxable year that exceed 125% of the average amount of distributions received by a U.S. Holder in respect of the common shares during the preceding three taxable years, or if shorter, during the U.S. Holder’s holding period prior to the taxable year of the distribution. The distributions that are excess distributions would be allocated ratably over the U.S. Holder’s holding period for the common shares. The amount allocated to the current taxable year and any taxable year prior to the first taxable year in which we were a PFIC would be taxed as ordinary income. The amount allocated to each of the other taxable years would be subject to tax at the highest marginal rate in effect for the U.S. Holder for that taxable year, and an interest charge for the deemed deferral benefit would be imposed on the resulting tax allocated to such other taxable years. The tax liability with respect to the amount allocated to taxable years prior to the year of the distribution cannot be offset by net operating losses. As an alternative to such tax treatment, a U.S. Holder may make a “qualified electing fund” election or “mark to market” election, to the extent available, in which event different rules would apply. The U.S. federal income tax consequences to a U.S. Holder if we were to be classified as a PFIC are complex. A U.S. Holder should consult with his or her own advisor with regard to those consequences, as well as with regard to whether he or she is eligible to and should make either of the elections described above.

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Non-U.S. Holders

Non-U.S. Holders generally will not be subject to U.S. federal income tax on dividends received from us on our common shares unless the income is effectively connected with the conduct by the Non-U.S. Holder of a trade or business in the United States (“effectively connected income”) (and, if an applicable income tax treaty so provides, the dividends are attributable to a permanent establishment maintained by the Non-U.S. Holder in the U.S.). Effectively connected income (or, if an income tax treaty applies, income attributable to a permanent establishment maintained in the U.S.) generally will be subject to regular U.S. federal income tax in the same manner discussed above relating to taxation of U.S. Holders. In addition, earnings and profits of a corporate Non-U.S. Holder that are attributable to such income, as determined after allowance for certain adjustments, may be subject to an additional branch profits tax at a rate of 30%, or at a lower rate as may be specified by an applicable income tax treaty. Non-U.S. Holders may be subject to tax in jurisdictions other than the United States on dividends received from us on our common shares.

Dividends paid on our common shares to a non-corporate U.S. Holder may be subject to U.S. federal backup withholding tax if the non-corporate U.S. Holder:

●

fails to provide us with an accurate taxpayer identification number;

●

is notified by the IRS that they have become subject to backup withholding because they previously failed to report all interest and dividends required to be shown on their federal income tax returns; or

●

fails to comply with applicable certification requirements

A holder that is not a U.S. Holder or a partnership may be subject to U.S. federal backup withholding with respect to such dividends unless the holder certifies that it is a non-U.S. person, under penalties of perjury, or otherwise establishes an exemption therefrom. Backup withholding tax is not an additional tax. Holders generally may obtain a refund of any amounts withheld under backup withholding rules that exceed their income tax liability by timely filing a refund claim with the IRS.

You are encouraged to consult your own tax advisor concerning the overall tax consequences arising in your own particular situation under U.S. federal, state, local, or foreign law from the payment of dividends on our common stock.

Cash Flows

Net cash provided by operating activities for the three months ended March 31, 2024 and 2023 was $32.3 million and $19.6 million, respectively. This increase in cash provided by operating activities was primarily due to higher freight rates earned by our major bulk vessels and changes in working capital. There was also a decrease in drydocking costs incurred during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023.

Net cash provided by (used in) investing activities for the three months ended March 31, 2024 and 2023 was $17.5 million and ($2.9) million, respectively. This fluctuation was primarily a result of $18.5 million of proceeds from the sale of the Genco Commodus during the first quarter of 2024.

Net cash used in financing activities during the three months ended March 31, 2024 and 2023 was $47.9 million and $30.4 million, respectively. The increase is primarily due to a $21.3 million increase in debt repayments made during the first quarter of 2024 as compared to the first quarter of 2023. This increase was partially offset by a $3.8 million decrease in the payment of dividends during the first quarter of 2024 as compared to the first quarter of 2023.

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Credit Facilities

On November 29, 2023, we entered into a fourth amendment to amend, extend and upsize our existing $450 Million Credit Facility, implementing the $500 Million Revolver. The amended structure consists of a $500 million revolving credit facility, which can be utilized to support growth of our asset base as well as general corporate purposes.

Interest Rate Swap and Cap Agreements, Forward Freight Agreements and Currency Swap Agreements

During the first quarter of 2024, our last remaining interest rate cap agreement that we used to manage interest costs and the risk associated with changing interest rates expired. Such agreements cap the borrowing rate on our variable debt to provide a hedge against the risk of rising rates. At March 31, 2024, the total notional principal amount of the interest rate cap agreements is $0.

Refer to Note 8 — Derivative instruments of our Condensed Consolidated Financial Statements for further information.

As part of our business strategy, we may enter into interest rate swap agreements to manage interest costs and the risk associated with changing interest rates. In determining the fair value of interest rate derivatives, we consider the creditworthiness of both the counterparty and ourselves, which has not changed significantly and has no effect on the valuation. Valuations prior to any adjustments for credit risk would be validated by comparison with counterparty valuations. Amounts would not and should not be identical due to the different modeling assumptions. Any material differences would be investigated.

As part of our business strategy, we may enter into arrangements commonly known as forward freight agreements, or FFAs, to hedge and manage our exposure to the charter market risks relating to the deployment of our vessels. Generally, these arrangements would bind us and each counterparty in the arrangement to buy or sell a specified tonnage freighting commitment “forward” at an agreed time and price and for a particular route. Upon settlement, if the contracted charter rate is less than the average of the rates (as reported by an identified index) for the specified route and period, the seller of the FFA is required to pay the buyer an amount equal to the difference between the contracted rate and the settlement rate multiplied by the number of days in the specific period. Conversely, if the contracted rate is greater than the settlement rate, the buyer is required to pay the seller the settlement sum. Although FFAs can be entered into for a variety of purposes, including for hedging, as an option, for trading, or for arbitrage, if we decided to enter into FFAs, our objective would be to hedge and manage market risks as part of our commercial management. It is not currently our intention to enter into FFAs to generate a stream of income independent of the revenues we derive from the operation of our fleet of vessels. If we determine to enter into FFAs, we may reduce our exposure to any declines in our results from operations due to weak market conditions or downturns, but may also limit our ability to benefit economically during periods of strong demand in the market. We have not entered into any FFAs as of March 31, 2024 and December 31, 2023.

Capital Expenditures

We make capital expenditures from time to time in connection with our vessel acquisitions. Our fleet currently consists of 43 drybulk vessels, including 16 Capesize, 15 Ultramax and twelve Supramax vessels.

As previously announced, we have implemented a fuel efficiency upgrade program for certain of our vessels in an effort to generate fuel savings and increase the future earnings potential for these vessels. The upgrades have been successfully installed during previous drydockings.

Under our comprehensive IMO 2023 compliance plan, we have installed and intend to install energy saving devices and apply high performance paint systems in order to reduce fuel consumption and emissions among other key initiatives, on select vessels. We have and plan to undertake most, if not all, of these initiatives while our vessels undergo their regularly scheduled drydocking. The future estimated expenditures are included in the table below.

In addition to acquisitions that we may undertake in future periods, we will incur additional expenditures due to special surveys and drydockings for our fleet.

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We estimate our drydocking costs, including capitalized costs incurred during drydocking related to vessel assets and vessel equipment, ballast water treatment systems (“BWTS”) costs, fuel efficiency upgrades and scheduled off-hire days for our fleet through 2025 to be:


Year	Estimated Drydocking Costs		Estimated BWTS Costs		Estimated Fuel Efficiency Upgrade Costs		Estimated Off-hire Days

	(U.S. dollars in millions)

April 1 - December 31, 2024	$	15.8	$	0.6	$	2.9	260
2025	$	35.6	$	1.1	$	4.1	640

The costs reflected are estimates based on drydocking our vessels in China. Actual costs will vary based on various factors, including where the drydockings are actually performed. We expect to fund these costs with cash on hand. These costs do not include drydock expense items that are reflected in vessel operating expenses.

Actual length of drydocking will vary based on the condition of the vessel, yard schedules and other factors. Higher repairs and maintenance expense during drydocking for vessels which are over 15 years old typically result in a higher number of off-hire days depending on the condition of the vessel.

During the three months ended March 31, 2024 and 2023, we incurred a total of $2.2 million and $4.1 million of drydocking costs, respectively, excluding costs incurred during drydocking that were capitalized to vessel assets or vessel equipment.

The drydockings for two of our vessels began during the first quarter of 2024 and completed during the second quarter of 2024. We estimate that eight of our vessels will be drydocked during the remainder of 2024 and 20 of our vessels will be drydocked during 2025.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Inflation

Inflation has only a moderate effect on our expenses given current economic conditions. In the event that significant global inflationary pressures appear, these pressures would increase our operating, voyage, general and administrative, and financing costs.

CRITICAL ACCOUNTING POLICIES

Except as described below, there have been no changes or updates to our critical accounting policies as disclosed in the 2023 10-K.

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Vessels and Depreciation

We record the value of our vessels at their cost (which includes acquisition costs directly attributable to the vessel and expenditures made to prepare the vessel for its initial voyage) less accumulated depreciation. We depreciate our drybulk vessels on a straight-line basis over their estimated useful lives, estimated to be 25 years from the date of initial delivery from the shipyard. Depreciation is based on cost less the estimated residual scrap value of $400/lightweight ton (lwt) based on the 15-year average scrap value of steel. An increase in the residual value of the vessels will decrease the annual depreciation charge over the remaining useful life of the vessels. Similarly, an increase in the useful life of a drybulk vessel would also decrease the annual depreciation charge. Comparatively, a decrease in the useful life of a drybulk vessel or in its residual value would have the effect of increasing the annual depreciation charge. However, when regulations place limitations over the ability of a vessel to trade on a worldwide basis, we will adjust the vessel’s useful life to end at the date such regulations preclude such vessel’s further commercial use.

The carrying value of each of our vessels does not represent the fair market value of such vessel or the amount we could obtain if we were to sell any of our vessels, which could be more or less. Under U.S. GAAP, we would not record a loss if the fair market value of a vessel (excluding its charter) is below our carrying value unless and until we determine to sell that vessel or the vessel is impaired as discussed in the 2023 10-K.

During the three months ended March 31, 2024 and 2023, there were no impairment losses for vessel assets recorded. During the year ended December 31, 2023, we recorded an impairment loss for three of our Capesize vessels (the Genco Commodus, the Genco Claudius and the Genco Maximus). The Genco Claudius and the Genco Maximus have been classified as held for sale as of March 31, 2024 and the Genco Commodus, the Genco Claudius and the Genco Maximus have been classified as held for sale as of December 31, 2023. Refer to Note 2 — Summary of Significant Accounting Policies in our Condensed Consolidated Financial Statements for further information.

Under our credit facility, we regularly submit to the lenders valuations of our vessels on an individual charter free basis in order to evidence our compliance with the collateral maintenance covenants under our credit facility. Such a valuation is not necessarily the same as the amount any vessel may bring upon sale, which may be more or less, and should not be relied upon as such. We were in compliance with the collateral maintenance covenant under our $500 Million Revolver as of March 31, 2024. We obtained valuations for all of the vessels in our fleet pursuant to the terms of the $500 Million Revolver.

We compare the carrying value of our vessels with the vessel valuations obtained for covenant compliance purposes to determine whether an indicator of impairment is present (excluding the three vessels held for sale as noted above). As of March 31, 2024 and December 31, 2023, eight of our Capesize vessels had carrying values that exceeded their vessel valuations, which is an indicator of impairment. However, based on an analysis of the anticipated undiscounted future net cash flows to be derived from each of these vessels as described in the 2023 10-K, there were no impairment losses recorded for these vessels incurred during the three months ended March 31, 2024 or the three months ended December 31, 2023 (excluding the three vessels held for sale as of December 31, 2023 as noted above).

The amount by which the carrying value at March 31, 2024 of eight of our Capesize vessels exceeded the valuation of such vessels for covenant compliance purposes ranged, on an individual vessel basis, from $0.2 million to $5.2 million per vessel, and $17.9 million on an aggregate fleet basis. Comparatively, the amount by which the carrying value at December 31, 2023 of eight of our Capesize vessels exceeded the valuation of such vessels for covenant compliance purposes ranged, on an individual vessel basis, from $4.1 million to $8.3 million per vessel, and $47.9 million on an aggregate fleet basis. The average amount by which the carrying value of these vessels exceeded the valuation of such vessels for covenant compliance purposes was $2.2 million at March 31, 2024 and $6.0 million as of December 31, 2023. However, neither such valuation nor the carrying value in the table below reflects the value of long-term time charters, if any, related to some of our vessels.

In the chart below, we list each of our vessels, the year it was built, the year we acquired it, and its carrying value as of March 31, 2024 and December 31, 2023. Vessels have been grouped according to their collateralized status as of March 31, 2024 and does not include any vessels held for sale.

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			Carrying Value (U.S.
			dollars in
			thousands) as of
		Year	March 31,		December 31,
Vessels	Year Built	Acquired	2024		2023
$500 Million Revolver
Baltic Bear	2010	2010	$	32,224	$	32,724
Baltic Wolf	2010	2010		32,590		33,078
Genco Lion	2012	2013		28,165		28,508
Genco Tiger	2011	2013		26,631		26,954
Baltic Scorpion	2015	2015		21,189		21,440
Baltic Mantis	2015	2015		21,425		21,677
Genco Hunter	2007	2007		7,450		7,564
Genco Warrior	2005	2007		6,103		6,211
Genco Aquitaine	2009	2010		8,131		7,948
Genco Ardennes	2009	2010		7,885		7,955
Genco Auvergne	2009	2010		7,898		7,971
Genco Bourgogne	2010	2010		8,493		8,580
Genco Brittany	2010	2010		8,505		8,590
Genco Languedoc	2010	2010		8,512		8,588
Genco Picardy	2005	2010		6,841		6,972
Genco Pyrenees	2010	2010		8,559		8,641
Genco Rhone	2011	2011		9,699		9,792
Genco Constantine	2008	2008		28,815		29,377
Genco Augustus	2007	2007		26,485		27,052
Genco London	2007	2007		26,801		27,295
Genco Titus	2007	2007		27,355		27,856
Genco Tiberius	2007	2007		26,560		27,127
Genco Hadrian	2008	2008		29,175		29,671
Genco Predator	2005	2007		6,759		6,888
Baltic Hornet	2014	2014		19,841		20,084
Baltic Wasp	2015	2015		20,084		20,326
Genco Endeavour	2015	2018		38,634		39,022
Genco Resolute	2015	2018		38,752		39,177
Genco Columbia	2016	2018		22,200		22,455
Genco Weatherly	2014	2018		18,321		18,118
Genco Liberty	2016	2018		41,705		42,162
Genco Defender	2016	2018		41,708		42,165
Genco Magic	2014	2020		13,416		13,373
Genco Vigilant	2015	2021		14,176		14,323
Genco Freedom	2015	2021		14,256		14,407
Genco Enterprise	2016	2021		18,795		18,996
Genco Madeleine	2014	2021		20,949		21,209
Genco Constellation	2017	2021		23,607		23,872
Genco Mayflower	2017	2021		23,981		24,251
Genco Laddey	2022	2022		28,042		28,299
Genco Mary	2022	2022		28,078		28,336
Genco Ranger	2016	2023		42,917		43,108
TOTAL			$	891,712	$	902,142
Unencumbered
Genco Reliance	2016	2023	$	42,860	$	42,972
			$	42,860	$	42,972
Consolidated Total			$	934,572	$	945,114

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If we were to sell a vessel or hold a vessel for sale, and the carrying value of the vessel were to exceed its fair market value, net of costs to sell, we would record a loss in the amount of the difference. Refer to Note 2 — Summary of Significant Accounting Policies and Note 4 — Vessel Acquisitions and Dispositions in our Condensed Consolidated Financial Statements for information regarding the sale of vessel assets.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest rate risk

We are exposed to the impact of interest rate changes. Our objective is to manage the impact of interest rate changes on our earnings and cash flow in relation to our borrowings. During the first quarter of 2024, our last remaining interest rate cap agreement that we used to manage interest costs and the risk associated with changing interest rates expired. Refer to Note 8 — Derivative Instruments of our Condensed Consolidated Financial Statements.

Interest rate cap agreements cap the borrowing rate on our variable debt to provide a hedge against the risk of rising rates.

We are subject to market risks relating to changes in SOFR rates because we have significant amounts of floating rate debt outstanding. On May 30, 2023, we entered into an amendment to the $450 Million Credit Facility to transition from the use of LIBOR to calculate interest to SOFR effective June 30, 2023. During the three months ended March 31, 2024 and 2023, we were subject to the following interest rates on the outstanding debt under our credit facilities (refer to Note 7 — Debt in our Condensed Consolidated Financial Statements for effective dates and termination dates for our credit facilities outlined below):

●

$450 Million Credit Facility

●

One-month or three-month LIBOR plus 2.15% during the three months ended March 31, 2023.

●

$500 Million Revolver

●

One-month SOFR plus 1.85% during the three months ended March 31, 2024.

A 1% increase in SOFR would result in an increase of $0.5 million in interest expense for the three months ended March 31, 2024.

From time to time, the Company may consider derivative financial instruments such as swaps and caps or other means to protect itself against interest rate fluctuations.

Derivative financial instruments

As part of our business strategy, we may enter into interest rate swaps or interest rate cap agreements to manage interest costs and the risk associated with changing interest rates. During the first quarter of 2024, our last remaining interest rate cap agreement that we used to manage interest costs and the risk associated with changing interest rates expired. Refer to Note 8 — Derivative Instruments of our Condensed Consolidated Financial Statements.

Our prior interest rate cap agreements were initially designated and qualified as cash flow hedges. The premium paid was recognized in income on a rational basis, and all changes in the value of the caps were deferred in AOCI and were subsequently reclassified into Interest expense in the period when the hedged interest affects earnings.

Refer to “Interest rate risk” section above for further information regarding interest rate swap agreements.

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We have entered into bunker swap and forward fuel purchase agreements with the objective of reducing the risk of the effect of changing fuel prices. Our bunker swap and forward fuel purchase agreements do not qualify for hedge accounting treatment; therefore, any unrealized or realized gains or losses are recognized as other income (expense). Refer to the “Bunker swap and forward fuel purchase agreements” section of Note 2 — Summary of Significant Accounting Policies for further information.

Currency and exchange rates risk

The majority of transactions in the international shipping industry are denominated in U.S. Dollars. Virtually all of our revenues and most of our operating costs are in U.S. Dollars. We incur certain operating expenses in currencies other than the U.S. dollar, and the foreign exchange risk associated with these operating expenses is immaterial.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including our Chief Executive Officer and President and our Chief Financial Officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this report. Based upon that evaluation, our Chief Executive Officer and President and our Chief Financial Officer have concluded that our disclosure controls and procedures are effective.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 5. OTHER INFORMATION

Rule 10b5-1 Trading Arrangements

On March 12, 2024, John C. Wobensmith, our Chief Executive Officer and President; Peter Allen, our Chief Financial Officer; Joseph Adamo, our Chief Accounting Officer, Treasurer, and Controller; and Jesper Christensen, our Chief Commercial Officer each adopted a Rule 10b5-1 sales plan (a “10b5-1 Plan”). The 10b5-1 Plans are intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act and, as to Messrs. Wobensmith, Allen, and Christensen, superseded prior 10b5-1 Plans adopted by each of them in September 2023. The 10b5-1 Plans provide for the sale of a portion of the number of shares of our common stock that may be issuable in settlement of RSUs and PRSUs previously awarded to these executive officers in order to satisfy such executive officers’ related tax obligations. The maximum number of shares of our common stock that may be sold under the 10b5-1 Plans are 192,934 for Mr. Wobensmith, 54,842 for Mr. Allen, 20,762 for Mr. Adamo, and 78,654 for Mr. Christensen. Each 10b5-1 Plan terminates on the earliest of August 23, 2028, completion of the sale of the foregoing shares of common stock according to the terms of the plan, and the relevant officer’s termination of the plan.

ITEM 6. EXHIBITS

The Exhibit Index attached to this report is incorporated into this Item 6 by reference.

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EXHIBIT INDEX


Exhibit			Document

3.1			Second Amended and Restated Articles of Incorporation of Genco Shipping & Trading Limited.(1)

3.2			Articles of Amendment to Genco Shipping & Trading Limited Second Amended and Restated Articles of Incorporation, dated July 17, 2015.(2)

3.3			Articles of Amendment to Genco Shipping & Trading Limited Second Amended and Restated Articles of Incorporation, dated April 15, 2016.(3)

3.4			Articles of Amendment to Second Amended and Restated Articles of Incorporation of Genco Shipping & Trading Limited, dated July 7, 2016.(4)

3.5			Articles of Amendment to Second Amended and Restated Articles of Incorporation of Genco Shipping & Trading Limited, dated January 4, 2017.(5)

3.6			Articles of Amendment to Second Amended and Restated Articles of Incorporation of Genco Shipping & Trading Limited dated July 15, 2020.(6)

3.7			Articles of Amendment to Second Amended and Restated Articles of Incorporation of Genco Shipping & Trading Limited dated May 13, 2021.(7)

3.8			Certificate of Designations of Rights, Preferences and Privileges of Series A Preferred Stock of Genco Shipping & Trading Limited, dated as of November 14, 2016.(8)

3.9			Amended and Restated By-Laws of Genco Shipping & Trading Limited, dated July 9, 2014.(1)

3.10			Amendment to Amended and Restated By-Laws, dated June 4, 2018.(9)

3.11			Second Amendment to Amended and Restated By-Laws, dated July 15, 2020.(6)

3.12			Third Amendment to Amended and Restated By-laws, dated January 11, 2021.(10)

3.13			Fourth Amendment to Amended and Restated By-laws, dated March 28, 2023.(11)

4.1			Form of Specimen Stock Certificate of Genco Shipping & Trading Limited.(1)

10.1			Restricted Stock Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and John C. Wobensmith.(*)

10.2			Restricted Stock Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Peter Allen.(*)

10.3			Restricted Stock Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Joseph Adamo.(*)

10.4			Restricted Stock Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Jesper Christensen.(*)

10.5			Performance PRSU Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and John C. Wobensmith.(*)

10.6			Performance PRSU Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Peter Allen.(*)

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10.7			Performance PRSU Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Joseph Adamo.(*)

10.8			Performance PRSU Unit Grant Agreement dated February 21, 2024 by and between Genco Shipping & Trading Limited and Jesper Christensen.(*)

31.1			Certification of Chief Executive Officer and President pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended.(*)

31.2			Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended.(*)

32.1			Certification of Chief Executive Officer and President pursuant to 18 U.S.C. Section 1350.(*)

32.2			Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.(*)

101			The following materials from Genco Shipping & Trading Limited’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 formatted in Inline XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023 (Unaudited), (ii) Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023 (Unaudited), (iii) Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2024 and 2023 (Unaudited), (iv) Condensed Consolidated Statements of Equity for the three months ended March 31, 2024 and 2023 (Unaudited), (v) Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023 (Unaudited), and (vi) Notes to Condensed Consolidated Financial Statements (Unaudited).(*)

104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).



(*)	Filed with this report.

(1)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on July 15, 2014.

(2)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on July 17, 2015.

(3)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on April 15, 2016.

(4)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on July 7, 2016.

(5)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on January 4, 2017.

(6)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on July 15, 2020.

(7)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on May 31, 2021.

(8)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on November 15, 2016.

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(9)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on June 5, 2018.

(10)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on January 11, 2021.

(11)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 8-K, filed with the Securities and Exchange Commission on March 31, 2023.

(12)	Incorporated by reference to Genco Shipping & Trading Limited’s Report on Form 10-Q, filed with the Securities and Exchange Commission on May 3, 2023.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GENCO SHIPPING & TRADING LIMITED


DATE: May 8, 2024	By:		/s/ John C. Wobensmith
	John C. Wobensmith
	Chief Executive Officer and President
	(Principal Executive Officer)


DATE: May 8, 2024	By:	/s/ Peter Allen
	Peter Allen
	Chief Financial Officer
	(Principal Financial Officer)