Greek Shipping News Cuts
Week 24 - 2007
---What's exciting about the opportunity in front of Aegean Marine is that it is aiming to be the brand leader in bunker fuel worldwide.
by Jon Markman, Jun 14, 2007 10:45 am
Over the past week, frenzy in the bond markets has sent stocks in most sectors running for cover. But ocean shippers and energy providers have weathered the recent storm quite well, owing in large part to their superior fundamentals and undeniable cheapness.
Global trade, supported primarily by the shipping industry, drives the bunker market. The global cargo fleet is poised to grow at 8% per year over the next four years, which gives bunkers a lot more thirsty tanks to fill. The current market size is estimated at a whopping 150 million tons of fuel a year, of which Aegean controls 1%. ANW's unique position as one of the few global brands in the business, along with recent favorable regulations, give it special appeal.
Normally regulations are something to worry about, but in the case of ANW they're a source of success. You see, in April 2001, the influential International Maritime Organization, a United Nations agency, adopted regulations that required tankers transporting crude oil and refined petroleum products to be constructed with double hulls that make environmentally devastating spills less likely. Most single-hull tankers, less than 25 years old, must be phased-out by the end of next year.
According to Lloyd's Marine Intelligence Unit, 90% of all bunkering tankers are single-hulls, of which two thirds will be over 25 years old by the end of 2008. Considering the fact that ANW's fleet is almost exclusively double-hulls, this opens up a lot of easily accessible market share.
To the UN it's a regulation, but from a practical standpoint, the new requirement is more like a guideline. The good news is that the European Union, Japan, and China intend to get with the program, and Singapore, the world's largest bunkering port, will disallow any new single-hull ships and phase-out those older than 25 years. Analysts at Johnson Rice & Co. expect ANW to focus on IMO-compliant markets where it has a pronounced competitive advantage.
The company is in the midst of expansion, both with its fleet and its service centers. ANW plans to acquire 34 double hull vessels by mid-2010, spending a cool $330 million. Like Genco Shipping (GNK), one of my other long-time favorites in ocean shipping, Aegean is cash-rich with relatively low debt. That's not all they have in common: Peter Georgiopoulos, the chairman of Aegean, is also the founder and chief executive of Genco, as well as a much larger shipping company, General Marine (GMR). He has a 10% stake in ANW, and has agreed to a three-year lock-up of his shares, a strong sign of his confidence in the company.
ANW will grow at around 30% annually over the next four years, yet its price/earnings multiple is just around 12. That's very cheap. It also pays a dividend that yields 2%, and should also grow. And furthermore, it could be a consolidator in a highly fractured industry.
He observed that the most important two initiatives at the company right now are its efforts to open five new service centers around the world and to add significantly to its bunker fueling fleet. Tavlarios won't say where the new service centers will be located, but you can bet they will likely be in high-traffic zones around the world, such as Africa, Latin America, Asia and Australia.
What's exciting about the opportunity in front of ANW is that it is aiming to be the brand leader in bunker fuel worldwide. Bunker fueling back in the 1960s and '70s used to be a role played by major integrated energy companies like Shell (RDS-A) and Chevron (CVX), but they exited the business because it tends to offer lower margins than exploring and refining. The industry then became a patchwork of mom-and-pop local dealers. Now ANW wants to be the leading brand worldwide. It wants to be the one that the owner of a big shipping fleet will trust first to deliver the right grade of the cleanest fuel at the right price at the right time in a safe fashion. Tavlarios says that it's been unusual in the past to have a fueling company that can be held accountable for its service and product, and ship owners will actually pay a slight premium for that.
ANW has been around since 1990, but mostly of its business was done in Greece. In 2001, it made the move to be a global player, and its initial public offering last year has given it the money to go forward with that expansion. It now has 31 ships on order at two yards in China, which gives it 20% of all new production. Each ship costs around $10 million, stretches 100 meters and weighs in at around 5,000 deadweight tons. They'll all be on the water under the ANW flag by the end of 2010.
It's more than just double-hulling that is important about the new boats, though. They also have faster pumping rates and segregated, coated tanks. This means ships will be fueled more quickly, and there is almost no chance of contamination between different grades of fuel.
Tavlarios noted that ANW's growth will come from its ability to grow the volume of fuel through an increased number of ships at an increased number of service centers. So as investors, I think we can count on occasional bumps up in the share price when announcements are made that a service center has been added or a ship goes on line. It buys fuel at wholesale and sells at retail, so there is really no spread to watch - as we do with refiners - to gauge an expanding profit margin. By the same token, the rise and fall of crude oil prices should also have little effect on ANW's prospects.
If you believe, as I do, that the global fleet of ships of all types -- oil tankers, dry bulk, containership and cruise lines -- will grow, then they will all consume more marine fuel, adding to ANW's success. I think this should be a great, long-term story. It has been trading at $13 to $19 since its IPO; I expect it to reach $24 in 12 months, 20X my 2009 earnings estimate. ANW is a buy on the current dip.
Diana Shipping Inc. Announces Delivery of Capesize Bulk Carrier
---ATHENS, GREECE, June 15, 2007 - Diana Shipping Inc. (NYSE: DSX), a global shipping transportation company specializing in dry bulk cargoes, today announced that on June 14 the Company took delivery of the newly-built Semirio, a 174,261 dwt Capesize dry bulk carrier, built by Shanghai Waigaoqiao Shipbuilding Co. Ltd.
During the initial two years, this employment is expected to generate gross revenues of approximately $35.7 million and is expected to generate gross revenues of $21.7 million during the third and fourth years, amounting to a total of $57.4 million. If the charterer exercises its option for the fifth year, the charter is expected to generate aggregate gross revenues of approximately $74 million over the entire period.
About the Company
Diana Shipping Inc. is a global provider of shipping transportation services. The Company specializes in transporting dry bulk cargoes, including such commodities as iron ore, coal, grain and other materials along worldwide shipping routes.
Globus Maritime shines at London IPO
---Investors who bought shares in the IPO of Globus Maritime enjoyed handy profits on the first trading day of the stock.
Globus owns and operates five Handymax vessels, with a Panamax bulk carrier due for delivery during July 2007.
Globus Maritime also sold 8.42M new ordinary shares.
This total represented 29.5% of the equity in the group, which is headed by CEO George Karageorgiou.
The Globus IPO was the third listing of a Greek bulk shipping company on AIM.
Further, Odin has had an impressive rise of 56.1% over the past 12 months.
The company said $34.1M of the proceeds will be used to pay outstanding considerations involved in the purchase of the Panamax vessel.
Full company name: Globus Maritime Ltd
Headquarters: Athens, Greece
Listed: AIM / London Stock Exchange
Ticker code: GLBS.L
Source: Fairplay International Shipping Weekly, 14 Jun 2007
Navios Maritime to Present at The 20th Annual Marine Money Week
---PIRAEUS, Greece, June 15 /PRNewswire-FirstCall/ -- Navios Maritime Holdings Inc. ("Navios") announced today that Mr. Ted Petrone, President of Navios Corporation will present at 20th Annual Marine Money Week at the Pierre Hotel in New York City on Wednesday, June 20, 2007 at 9:00 AM EDT.
The Company also announced that on Tuesday, June 19, 2007, at 5:00 PM EDT, Mr. Petrone will appear on CNBC's "Kudlow and Company" to discuss Navios and the drybulk industry.
Check with your cable or satellite provider for the CNBC channel in your area.
Source: Posted : Fri, 15 Jun 2007 12:33:59 GMT http://www.earthtimes.org/articles/show/news_press_release,123106.shtml Author : Navios Maritime Holdings Inc. Category : PressRelease
Paragon Shipping Files for Listing
---The initial fund-raising phase Paragon Shipping deal was actually completed at the end of 2006, and executed so well as to earn a Deal of the Year award for arrangers Cantor Fitzgerald, CRT Capital Group and Oppenheimer. However it is not until very recently that the company began the public filing process necessary to allow it to list on the Nasdaq OTC market. As such a great deal of information about the company has been made available for the first time and we consider it worthwhile to review it for background and to better understand what it was that the initial but more secretive private placement accomplished.
The company benefits from a non-amortizing 3.5 year credit facility provided by HSH Nordbank. The facility has a limit of $109.5 million and is understood to be costing the company around 6.5%.
Seward & Kissel is serving as counsel to the company in its SEC registration.
Source: h t t p : / /www.ma r i n emo n e y . c om Ma r i n e Mo n e y F r e s h l y Mi n t e d T h u r s d a y , J u n e 1 4 , 2 0 0 7 P a g e 3
TEN Limited: First phase of LNG investment now complete
ABOUT TSAKOS ENERGY NAVIGATION
The strategy of a balanced diverse fleet is reflected in 28 crude transporters ranging from VLCCs to Aframaxes and 24 product carriers ranging from Handysize to Aframaxes; complemented by one LNG.
Border Police has detained Greek tanker 'Minerva Clara'
The captain of the tanker, which had been entered Georgian waters, let the rescue boat in the water without warning, which is considered to be violation of naval rules according to Georgian Law.
The tanker was fined with 50 000 GEL. The sum must be transformed to the Georgian budget during the term of one month. Before paying the fine, the Ship will stay in the Batumi port.
Source: June 15, 2007, 01:05 PM, http://www.imedinews.ge/en/news_read/45905/
Shipping fund to tap booming dry freight sector
---LONDON: A fund manager investing in the booming dry freight sector has so far chartered 12 panamax ships to ferry raw materials such as coal, iron ore, grains and fertiliser around the world.
Dry freight prices struck record highs in May because of robust global economic growth and surging demand for raw materials from China and India.
Steve Rodley, director at London- and Athens-based M2M Management, said the profit opportunity arises because of differences between the way the traditional shipping industry and commodity firms work.
Global Maritime, probably the only one involved in physical shipping of commodities, has one further panamax until October 2008. Panamax ships, up to 80,000 tonnes, are named for being the biggest ships that can squeeze through the Panama Canal in Latin America.
The strategy works because commodity firms do not want to be involved in the shipping market as owners and operators.
Rodley thinks there are only five funds worthy of note in the shipping market. Two trade the stocks of shipping and related companies, one trades equities and freight futures on the Baltic Exchange and one trades only freight futures.
Rodley said the information gained from being in both the physical and futures market was critical.
Global Maritime has between launch on October 5, 2006 and the end of May returned nearly 20%.
Source: Published: Monday, 11 June, 2007, 01:58 AM Doha Time , http://www.gulf-times.com
HSH Nordbank opening representative office in Greece
Subject to the approval of the Bank of Greece, the representative office will open in the third quarter of 2007 and initially employ three relationship managers and two product specialists.
The Shipping Business Unit of the overall bank made a successful start to fiscal 2007. Flourishing markets provided new business amounting to EUR 3 billion in the first quarter (previous year: EUR 2.3 billion). In the first quarter, earnings after risk provisioning rose from EUR 71 million to EUR 91 million year on year.
Business with Greek shipping companies grew vigorously as well, posting a year-on-year gain of 35 percent to EUR 3.8 billion in the first quarter. The volume of business done with Greek clients has risen by an annual average of 45 percent over the past three years. In view of lively markets, HSH Nordbank projects continuing dynamic growth in the Greek shipping business for the current year.
However, HSH Nordbank also provides customized solutions involving a large variety of specialized ships. In addition to the pure lending business, HSH Nordbank has been focusing to an increasing extent on comprehensive advisory services for all types of shipping companies. Apart from structured and innovative financing methods, the Bank also offers one-stop solutions covering all potential financial service requirements.
Innovative instruments for hedging interest, currency and oil-price risks round off the range of products on offer. Here, HSH Nordbank offers solutions that are designed to hedge the risks involved in each individual case
For more information please visit our website at www.hsh-nordbank.com
Source: Press Release
Helmepa marks 25 years
---4 June 1982 was a landmark day when shipowners and seafarers banded together to create the Hellenic Marine Environment Protection Association (Helmepa).
The signing of their declaration of voluntary commitment "to save the seas" came at a time when environmental issues were not high on the agenda and many believed the association would not last long.
However, last week, some 500 people gathered at the Athens Concert Hall to celebrate Helmepa's 25th anniversary and to pay tribute to those who have dedicated time, effort and money to the aims of training merchant marine officers, raising awareness in schoolchildren and contributing when and wherever they can to protecting the marine environment.
Brainchild of the late George P Livanos, Helmepa has spawned another six "mepas" in Cyprus, the UK, Turkey, Uruguay, the Philippines and Australia, while an umbrella outfit, Intermepa, was formed last year and headquartered in Athens.
Besides George P Livanos, the big names in Greek shipping that have served as board members of Helmepa reads like a who's who of the Greek shipping industry - Chandris, Hajieleftheriadis, Goumas, Goulandris, Lemos, Los, Martinos, Lyras, Gratsos and Tsangaris Kanellakis to name just a few.
Captain Vassilis Constantakopoulos in particular espoused the efforts of Helmepa Junior, which in the 14 years since its foundation has seen more than 44,000 children take part in its activities such as beach clean-ups and poster competitions. This year marked the 25th consecutive training programme for Greek merchant marine officers. Since 1983, over 15,000 Greek seafarers have attended these courses.
"When Helmepa was formed, environmental protection wasn't very much in fashion," commented Ioannis Joannos, secretary-general of the Greek shipping ministry. And the head of the environment committee of the Greek parliament hailed the association as "a real lesson in responsibility".
The ceremony could not have been complete without many heartfelt congratulations to the Helmepa staff headed up by the tireless Dimitris Mitsatsos, who has been involved since the beginning.
The chairmen of Cymepa, George Tsavliris, and Turmepa, Esref Cerrahoglu, both made presentations to current Helmepa chairman Nicolas Pappadakis, while Urmepa was represented by Uruguay's ambassador to Athens and Ausmepa by one of its board.
But all was not speechifying. With a symbolism that is so dear to the Greek heart, dancers from the Kalamata branch of the Hellenic Lyceum performed traditional folk dances from the Greek islands, while a children's choir sang folk songs also from the islands and the region of Messinia in the Peloponnese.
published: 15 June 2007
Karamanlis keeps his word, but concerns remain, says Embiricos
---Government measures aimed at improving the competitiveness of the Greek flag received a ringing endorsement from London-based Greek shipowners. "The Prime minister has been true to his word, and his government has now taken the necessary action to render the Greek flag fleet competitive and ensure in the future, a large and vibrant fleet flying the Greek flag," said Epaminondas G.E. Embiricos when addressing the Greek Shipping Co-operation Committee's agm.
The GSCC chairman said: "This fleet will enable the Greek seafarers of the future to be formed and trained so as to man both our vessels and the shore-based maritime cluster."
Embiricos said the measures that have been introduced were discussed when he visited the PM Costas Karamanlis in August 2006.
However, during his report on developments during 2006, Embiricos expressed concern over a number of issues facing the shipping industry generally. Though some progress has been made regarding the EU Directive which criminalises accidental pollution, and thus criminalises the seafaring profession, and the systemic risk posed both to the P&I system as a whole and to its shipowner members, are still of concern.
So to is the unfriendly stance of the European Commission towards European shipping. "Unfortunately this situation does not seem to have improved. Both the European Commission and the European Parliament continue to pursue initiatives which are harmful to European shipping and place it at a competitive disadvantage," said Embiricos.
He said disappointed remains regarding the Common Structural Rules adopted by IACS, which "instead of mandating the construction of robust vessels, fit for the purpose for which they were being built, has instead opted for the lowest common denominator". He said that "amendments to the Common Structural Rules, now being introduced by IACS, will result in a further diminution of standards and thereby risk calling into question IACS's credibility.
"We must hope the introduction of Goal Based Standards at Imo will help to resolve this unfortunate situation," said the GSCC chairman.
Source: www.newsfront.gr, 15 June 2007
Papandreou: Vision of new econ development model
The PASOK leader stated that green development is a significant advantage for the economy and added that it guarantees and ensures quality life for all people.
Perama mayor Yannis Glykas briefed Papandreou on local problems and requested access to the sea, construction of an additional road and greater support to the Perama shipyard zone.
Regions like Perama will have to be protected by the State and not be left downgraded in an 'environmental apartheid' due to poor finances, Papandreou said, adding that access to a dignified quality environment is necessary while underlining that the removal of oil tanks from the region will lead to its upgrading.
Source: Athens News Agency, Greece - Jun 13, 2007, http://www.ana.gr/anaweb/user/showplain?maindoc=5428080&maindocimg=5427980&service=8
Arrest warrants over Sea Diamond
---By Nassos Stylianou, GREEK AUTHORITIES have issued arrest warrants for the captain and members of the crew of the stricken Sea Diamond vessel because fuel from the sunken cruise ship has yet to be pumped from its tanks.
According to reports in the Greek newspaper Ethnos yesterday, the warrants were issued because the officials from the company did not comply with regulations and submit a plan for the removal of the fuel that remains in the ship.
Based on reports, up to 400 tonnes are still inside the ship which sank just one day after running aground. Locals as well as environmentalists fear that there is a possibility of the fuel leaking out and polluting the sea around the island at the height of the tourist season.
According to EU Environment Commissioner Stavros Dimas, if a country does not have the adequate resources to deal with such an event then it should call on other member states for assistance. Dimas said that such a demand was not made, while the local authorities are still awaiting for a plan to be submitted as well as a list of all the pollutants from the ship, 68 days after the incident.
Greek authorities had attributed the incident to human error while a Greek prosecutor charged the captain and six other crew members with negligence. If found guilty, the crew could face a suspended prison sentence.
Louis Cruise announced last month that it had acquired a new vessel to replace the Sea Diamond.
Shipowners are proving to be very successful on land as well
---Greek shippers have made major investments in a variety of sectors.
By Nikos Bardounias - Kathimerini
The investment upsurge on land is no coincidence for Greek shipowners. It reflects the high profits they have enjoyed in recent years, both from sales of ships and their operation. International analysts estimate that local shipowners daily earn tens of millions of dollars, while their cash flow is estimated at about $120 billion. This then explains how many shipowners can invest considerable amounts of money in the mass media, real estate, banks and shopping centers, while even donating to charity foundations.
Real estate investment
One of the first shipowners to start investing on land was Vassilis Constantakopoulos, who envisioned a major tourism investment in his hometown of Kalamata in the Peloponnese back in 1997. Yet from the outset he ran into huge problems. Today it appears that the problems have been resolved and the investment can be completed within the next two to three years.
Sources suggest that this shipowner has secured an agreement with a major tour operator active in Southeast Asia for it to undertake the management of the complex at Pota, near Kalamata. This could potentially change the tourism flow to Greece and even more importantly raise the quality of incoming tourism.
Constantakopoulos has already created a modern town in the US, covering 2 square kilometers, and whose main avenue is named after the late Greek minister and actress, Melina Mercouri. In another state he has bought an expanse of land on which he has created a modern vineyard and has already presold its entire production for one decade.
Bulgaria shopping center
This investment, being realized in cooperation with construction companies and banks, is aimed at creating a modern building in Sofia that will house offices and stores which will later be sold or leased. At present, efforts are focused on obtaining the necessary license for the investment.
In addition to its shipping activity, Danaos is also breaking ground in the supply of integrated information technology solutions. It began its activity in the shipping domain, developing and installing its pioneering Info@GATE system of electronic communication in many companies in Greece and abroad. The system fully covers the communication needs of all modern and rapidly developing enterprises. In the shipping sector, it is estimated that the system meets 70 percent of the needs of Greek shipping offices and ships with IT systems.
A few months ago Theodoros Angelopoulos bought the Eleftheros Typos newspaper. On 19 April this year, Victor Restis caused a stir by offering 7.8 million euros and acquiring 33.4 percent of IMAKO, the publishing company of Petros Costopoulos, just a few days later acquiring a further 5.02 percent in the same company from shipowner Nikos Pateras. He was recently reported to have increased his stake in the Lymberis Publications group from 2.18 percent to 5.01 percent.
Restis has in recent months been very active in sales and acquisitions of companies. In late 2006 he bought 51 percent of FB Bank, before selling this stake to Pavlos Psomiadis of Alpha Bank.