Diana Shipping Inc 6-K, filed Sep 12, 2024
Diana Shipping Inc. (DSX)
6-K
2024-09-12
For: 2024-06-30
View Original
Added on
April 08, 2026
About this 6-K
Diana Shipping Inc filed this 6-K on September 12, 2024.
FORM
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of September
Commission File Number: 001-32458
(Translation of registrant's name into English)
Pendelis 16, 175 64 Palaio Faliro, Athens, Greece
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-
F.
Form 20-F [X] Form 40-F [ ]
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached to this Report on Form 6-K as Exhibit 99.1 is the unaudited interim consolidated financial statements of
Diana Shipping Inc. (the "Company") as of and for the six months ended
.
The information contained in this Report on Form 6-K is hereby incorporated by reference into the Company's
registration statements on Form F-3 (File Nos. 333-280693 and 333-266999) that were filed with the U.S. Securities
and Exchange Commission and became effective on September 9, 2024 and September 16, 2022, respectively .
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.
DIANA SHIPPING INC.
(registrant)
Dated: September 12, 2024
By:
/s/ Ioannis Zafirakis
Ioannis Zafirakis
Chief Financial Officer
2
Management's Discussion and Analysis Of
Financial Condition and Results Of Operations
The following management's discussion and analysis should be read in conjunction with our interim
unaudited consolidated financial statements and their notes attached hereto. This discussion contains
forward-looking statements that reflect our current views with respect to future events and financial
performance. Our actual results may differ materially from those anticipated in these forward-looking
statements. For additional information relating to our management's discussion and analysis of financial
condition and results of operations, please see our annual report on form 20-F for the year ended
December 31, 2023 filed with the with the SEC on April 5, 2024.
Our Operations
We charter our vessels, owned and bareboat chartered-in, to customers primarily pursuant to short-,
medium- and long-term time charters. Under our time charters, the charterer typically pays us a fixed
daily charter hire rate and bears all voyage expenses, including the cost of bunkers (fuel oil) and port and
canal charges. We remain responsible for paying the chartered vessel's operating expenses, including
the cost of crewing, insuring, repairing, and maintaining the vessel, the costs of spares and consumable
stores, tonnage taxes and other miscellaneous expenses, and we also pay commissions to one or more
unaffiliated ship brokers and to in-house brokers associated with the charterer for the arrangement of the
relevant charter.
The following table presents certain information concerning the dry bulk carriers in our fleet, as of the
date of this report.
3
Fleet Employment (As of September 9, 2024)
VESSEL
SISTE
R
SHIPS*
GROSS RATE
(USD PER DAY)
COM**
CHARTERERS
DELIVERY DATE
TO
CHARTERERS***
REDELIVERY DATE TO
OWNERS****
NOTES
BUILT DWT
9 Ultramax Bulk Carriers
1
DSI Phoenix
A
16,500
5.00%
Bulk Trading SA
6-May-24
1/Aug/2025 - 30/Sep/2025
2017 60,456
2
DSI Pollux
A
14,000
4.75%
Cargill Ocean Transportation
(Singapore) Pte. Ltd.
28-Dec-23
20/Aug/2025 - 20/Oct/2025
2015 60,446
3
DSI Pyxis
A
14,250
5.00%
ASL Bulk Marine Limited
24-Sep-23
10/Oct/2024 - 10/Dec/2024
2018 60,362
4
DSI Polaris
A
13,100
5.00%
ASL Bulk Marine Limited
12-Nov-22
20-Jul-24
2018 60,404
15,400
5.00%
Stone Shipping Ltd
20-Jul-24
1/Jun/2025 - 15/Aug/2025
5
DSI Pegasus
A
14,000
5.00%
Reachy Shipping (SGP) Pte. Ltd.
7-Dec-22
5-Sep-24
2015 60,508
15,250
4.75%
Cargill Ocean Transportation
(Singapore) Pte. Ltd
5-Sep-24
1/Jun/2025 - 1/Aug/2025
6
DSI Aquarius
B
14,500
5.00%
Stone Shipping Ltd
18-Jan-24
1/Dec/2024 - 1/Feb/2025
2016 60,309
7
DSI Aquila
B
12,500
5.00%
Western Bulk Carriers AS
11-Nov-23
10/Nov/2024 - 10/Jan/2025
2015 60,309
8
DSI Altair
B
13,800
5.00%
Western Bulk Carriers AS
23-Jun-23
21/Sep/2024 - 10/Oct/2024
1
2016 60,309
9
DSI Andromeda
B
13,500
5.00%
Bunge SA, Geneva
27-Nov-23
20/Feb/2025 - 20/Apr/2025
2
2016 60,309
6 Panamax Bulk Carriers
10
LETO
16,000
5.00%
ASL Bulk Shipping Limited
3-May-24
1/Mar/2025 - 30/Apr/2025
2010 81,297
11
SELINA
C
12,000
4.75%
Cargill International S.A., Geneva
20-May-23
15/Sep/2024 - 15/Nov/2024
2010 75,700
12
MAERA
C
13,750
5.00%
ST Shipping and Transport Pte.
Ltd.
29-Jan-24
20/Nov/2024 - 20/Jan/2025
2013 75,403
13
ISMENE
12,650
5.00%
Paralos Shipping Pte., Ltd.
13-Sep-23
15/Apr/2025 - 30/Jun/2025
2013 77,901
14
CRYSTALIA
D
13,900
5.00%
Louis Dreyfus Company Freight
Asia Pte. Ltd.
4-May-24
4/Feb/2026 - 4/Jun/2026
2014 77,525
15
ATALANDI
D
15,800
5.00%
Quadra Commodities SA
28-May-24
20-Jul-24
2014 77,529
14,600
4.75%
Cargill International SA, Geveva
20-Jul-24
1/Jun/2025 - 31/Jul/2025
6 Kamsarmax Bulk Carriers
16
MAIA
E
13,500
5.00%
ST Shipping and Transport Pte.
Ltd.
23-Sep-23
30-Aug-24
3.4
2009 82,193
17
MYRSINI
E
17,100
5.00%
Cobelfret S.A. Luxembourg
25-Jun-24
1/Feb/2025 - 25/Mar/2025
2010 82,117
18
MEDUSA
E
14,250
5.00%
ASL Bulk Shipping Limited
14-May-23
10/Feb/2025 - 15/Apr/2025
2010 82,194
19
MYRTO
E
12,650
5.00%
Cobelfret S.A., Luxemburg
15-Jul-23
1/Nov/2024 - 15/Jan/2025
2013 82,131
20
ASTARTE
15,000
5.00%
Reachy Shipping (SGP) Pte. Ltd.
29-Apr-23
19-Aug-24
2013 81,513
14,000
5.00%
Paralos Shipping Pte. Ltd.
19-Aug-24
15/Jul/2025 - 15/Sep/2025
4
21
LEONIDAS P. C.
17,000
5.00%
Ming Wah International Shipping
Company Limited
22-Feb-24
20/Aug/2025 - 20/Oct/2025
2011 82,165
5 Post-Panamax Bulk Carriers
22
ALCMENE
13,150
5.00%
China Steel Express Corporation
1-Jun-24
11-Aug-24
5
2010 93,193
13,350
5.00%
11-Aug-24
25-Sep-24
23
AMPHITRITE
F
15,000
5.00%
Cobelfret S.A., Luxembourg
13-Jan-24
15/Nov/2024 - 15/Jan/2025
6
2012 98,697
24
POLYMNIA
F
17,500
5.00%
Reachy Shipping (SGP) Pte. Ltd.
8-Jun-24
1/Aug/2025 - 30/Sept/2025
2012 98,704
25
ELECTRA
G
14,000
4.75%
Aquavita International S.A.
3-Jun-24
15/Oct/2025 - 31/Dec/2025
2013 87,150
26
PHAIDRA
G
12,250
4.75%
Aquavita International S.A.
9-May-23
15/Sep/2024 - 15/Oct/2024
1
2013 87,146
9 Capesize Bulk Carriers
27
SEMIRIO
H
14,150
5.00%
Solebay Shipping Cape
Company Limited, Hong Kong
18-Aug-23
20/Nov/2024 - 30/Jan/2025
2007 174,261
28
HOUSTON
H
13,000
5.00%
EGPN Bulk Carrier Co., Limited
21-Nov-22
2-Sep-24
7
2009 177,729
29
NEW YORK
H
16,000
5.00%
SwissMarine Pte. Ltd., Singapore
11-Jun-23
1/Oct/2024 - 7/Dec/2024
2010 177,773
30
SEATTLE
I
17,500
5.00%
Solebay Shipping Cape
Company Limited, Hong Kong
1-Oct-23
15/Jul/2025 - 30/Sep/2025
2011 179,362
31
P. S. PALIOS
I
27,150
5.00%
Bohai Shipping (HEBEI) Co., Ltd
7-May-24
1/Nov/2025 - 31/Dec/2025
2013 179,134
32
G. P. ZAFIRAKIS
J
17,000
5.00%
Solebay Shipping Cape
Company Limited, Hong Kong
12-Jan-23
14-Aug-24
4
2014 179,492
26,800
5.00%
Nippon Yusen Kabushiki Kaisha,
Tokyo
15-Sep-24
15/Aug/2026 - 15/Nov/2026
8
33
SANTA BARBARA
J
21,250
5.00%
Smart Gain Shipping Co., Limited
7-May-23
10/Oct/2024 - 10/Dec/2024
9
2015 179,426
34
NEW ORLEANS
20,000
5.00%
Kawasaki Kisen Kaisha, Ltd.
7-Dec-23
15/Aug/2025 - 31/Oct/2025
9
2015 180,960
35
FLORIDA
25,900
5.00%
Bunge S.A., Geneva
29-Mar-22
29/Jan/2027 - 29/May/2027
2
2022 182,063
4 Newcastlemax Bulk Carriers
36
LOS ANGELES
K
17,700
5.00%
Nippon Yusen Kabushiki Kaisha,
Tokyo
21-Jan-23
20-Jul-24
2012 206,104
28,700
20-Jul-24
1/Oct/2025 - 15/Dec/2025
37
PHILADELPHIA
K
22,500
5.00%
Nippon Yusen Kabushiki Kaisha,
Tokyo
4-Feb-24
20/Apr/2025 - 20/Jul/2025
2012 206,040
38
SAN FRANCISCO
L
22,000
5.00%
SwissMarine Pte. Ltd., Singapore
18-Feb-23
5/Jan/2025 - 5/Mar/2025
2017 208,006
39
NEWPORT NEWS
L
20,000
5.00%
Nippon Yusen Kabushiki Kaisha,
Tokyo
20-Sep-23
10/Mar/2025 - 10/Jun/2025
2017 208,021
** Total commission percentage paid to third parties.
*** In case of newly acquired vessel with time charter attached, this date refers to the expected/actual date of delivery of the vessel to the Company.
**** Range of redelivery dates, with the actual date of redelivery being at the Charterers’ option, but subject to the terms, conditions, and exceptions of the
particular charterparty.
5
1Based on latest information.
2Bareboat chartered-in for a period of ten years.
3Charterers have agreed for any time in excess of the charter party period to pay the rate of 105% of the Baltic Panamax Index 5 TC average as published by
the Baltic Exchange on a daily basis during the excess period commencing from August 20, 2024 or the vessel’s present charter party rate, whichever is
higher.
4Currently without an active charterparty. Vessel on scheduled drydocking.
5Redelivery date based on an estimated time charter trip duration of about 45 days
6The charter rate will be US$12,250 per day for the first 30 days of the charter period.
7Vessel has been sold and delivered to her new Owners on September 4, 2024.
8Estimated delivery date to the Charterers.
9Bareboat chartered-in for a period of eight years.
6
Factors Affecting Our Results of Operations
We believe that our results of operations are affected by the following factors:
(1) Average number of vessels is the number of vessels that constituted our fleet for the relevant
period, as measured by the sum of the number of days each vessel was a part of our fleet during the
period divided by the number of calendar days in the period.
(2) Ownership days are 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.
(3) Available days are the number of our ownership days less the aggregate number of days that our
vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special
surveys and the aggregate amount of time that we spend positioning our vessels for such events. The
shipping industry uses available days to measure the number of days in a period during which vessels
should be capable of generating revenues. Our method of computing available days may not necessarily
be comparable to available days of other companies.
(4) Operating days are the number of available days in a period less the aggregate number of days
that our vessels are off-hire due to any reason, including unforeseen circumstances. The shipping
industry uses operating days to measure the aggregate number of days in a period during which vessels
actually generate revenues.
(5) We calculate fleet utilization by dividing the number of our operating days during a period by the
number of our available days during the period. The shipping industry uses fleet utilization to measure a
company's efficiency in finding suitable employment for its vessels and minimizing the number of days
that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel
upgrades, special surveys or vessel positioning for such events.
(6) Time charter equivalent rate, or TCE, is defined as our time charter revenues less voyage
expenses during a period divided by the number of our available days during the period, which is
consistent with industry standards. TCE is a non-GAAP measure, and management believes it is useful
to investors because it is a standard 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 charter hire rates for vessels on voyage charters are generally not expressed in per
day amounts while charter hire rates for vessels on time charters are generally expressed in such
amounts. TCE is used by management to assess and compare the vessels’ profitability.
(7) Daily vessel operating expenses, which include crew wages and related costs, the cost of
insurance, expenses relating to repairs and maintenance, the costs of spares and consumable stores,
tonnage taxes and other miscellaneous expenses, are calculated by dividing vessel operating expenses
by ownership days for the relevant period.
The following table reflects such factors for the periods indicated:
7
For the six months ended June 30,
2024
2023
Ownership days
7,162
7,468
Available days
7,112
7,407
Operating days
7,078
7,377
Fleet utilization
99.5%
99.6%
Time charter equivalent (TCE) rate
$
15,078
$
17,910
The following table reflects the calculation of our TCE rates for the periods presented:
For the six months ended June 30,
2024
2023
in thousands of US Dollars, except for days and
TCE rates
Time charter revenues
$
113,648
$
140,021
less: Voyage expenses
(6,413)
(7,364)
Time charter equivalent revenues
107,235
132,657
Available days
7,112
7,407
Time charter equivalent (TCE) rate
$
15,078
$
17,910
Time Charter Revenues
Our revenues are driven primarily by the number of vessels in our fleet, the number of days during which
our vessels operate and the amount of daily charter hire rates that our vessels earn under charters,
which, in turn, are affected by a number of factors, including:
●
●
●
●
●
●
●
Vessels operating on time charters for a certain period of time provide more predictable cash flows over
that period of time but can yield lower profit margins than vessels operating in the spot charter market
during periods characterized by favorable market conditions. Vessels operating in the spot charter market
generate revenues that are less predictable but may enable their owners to capture increased profit
margins during periods of improvements in charter rates although their owners would be exposed to the
risk of declining charter rates, which may have a materially adverse impact on financial performance. As
we employ vessels on period charters, future spot charter rates may be higher or lower than the rates at
8
which we have employed our vessels on period charters. Our time charter agreements subject us to
counterparty risk. In depressed market conditions, charterers may seek to renegotiate the terms of their
existing charter parties or avoid their obligations under those contracts. Should a counterparty fail to
honor their obligations under agreements with us, we could sustain significant losses which could have a
material adverse effect on our business, financial condition, results of operations and cash flows.
Voyage Expenses
We incur voyage expenses that mainly include commissions because all of our vessels are employed
under time charters that require the charterer to bear voyage expenses such as bunkers (fuel oil), port
and canal charges. Although the charterer bears the cost of bunkers, we also have bunker gain or loss
deriving from the price differences of bunkers. When a vessel is delivered to a charterer, bunkers are
purchased by the charterer and sold back to us on the redelivery of the vessel. Bunker gain, or loss,
results when a vessel is redelivered by her charterer and delivered to the next charterer at different
bunker prices, or quantities.
We currently pay commissions ranging from 4.75% to 5.00% of the total daily charter hire rate of each
charter to unaffiliated ship brokers, in-house brokers associated with the charterers, depending on the
number of brokers involved with arranging the charter. In addition, we pay a commission to DWM and to
DSS for those vessels for which they provide commercial management services. The commissions paid
to DSS are eliminated from our consolidated financial statements as intercompany transactions. The
effect of bunker prices cannot be determined, as a gain or loss from bunkers results mainly from the
difference in the value of bunkers paid by the Company when the vessel is redelivered to the Company
from the charterer under the vessel’s previous time charter agreement and the value of bunkers sold by
the Company when the vessel is delivered to a new charterer.
Vessel Operating Expenses
Vessel operating expenses include crew wages and related costs, the cost of insurance, expenses
relating to repairs and maintenance, the cost of spares and consumable stores, tonnage taxes,
environmental plan costs and HSQ and vetting. Our vessel operating expenses generally represent fixed
costs.
Vessel Depreciation
The cost of our vessels is depreciated on a straight-line basis over the estimated useful life of each
vessel. Depreciation is based on the cost of the vessel less its estimated salvage value. We estimate the
useful life of our dry bulk vessels to be 25 years from the date of initial delivery from the shipyard, which
we believe is common in the dry bulk shipping industry. Furthermore, we estimate the salvage values of
our vessels based on historical average prices of the cost of the light-weight ton of vessels being
scrapped.
General and Administrative Expenses
We incur general and administrative expenses which include our onshore related expenses such as
payroll expenses of employees, executive officers, directors and consultants, compensation cost of
restricted stock awarded to senior management and non-executive directors, traveling, promotional and
other expenses of the public company, such as legal and professional expenses and other general
expenses. General and administrative expenses are not affected by the size of the fleet. However, they
are affected by the exchange rate of the Euro to US Dollars, as about half of our administrative expenses
are in Euro.
9
Interest and Finance Costs
We incur interest expenses and financing costs in connection with vessel-specific debt, senior unsecured
bond and finance liabilities. As of June 30, 2024 total long-term debt amounted to $491.1 million and
finance liabilities amounted to $128.7 million. While our bond and finance liabilities have a fixed interest
rate, the loan agreements with our banks have a floating rate based on term SOFR plus a margin.
Inflation
Since 2022 there have been significant global inflationary pressures which have affected our operating
and drydocking costs.
Results of Operations
Six months ended June 30, 2024, compared to the six months ended June 30, 2023
Time charter revenues.
the six months ended June 30, 2024, compared to $140.0 million for the same period of 2023. The
decrease in time charter revenues was due to the decreased average time charter rate of $15,078 per
vessel per day that the Company achieved for its vessels in the six months ended June 30, 2024,
compared to $17,910 in the same period of 2023, representing a 16% decrease. This decrease, which
was due to the weakened market conditions, was also attributed to the decreased operating days in the
six months ended June 30, 2024, compared to the same period last year, resulting from the decrease in
the size of the fleet compared to the same period last year. Operating days for the six months ended
June 30, 2024, were 7,078 compared to 7,377 for the same period of 2023.
Voyage expenses.
ended June 30, 2024, as compared to $7.4 in the six months ended June 30, 2023. The decrease was
mainly due to commissions, for which voyage expenses is primarily comprised of and which in the six
months ended June 30, 2024 decreased by 17% to $5.8 million compared to $7.0 million in the six
months ended June 30, 2023, due to the decrease in revenues. This decrease was partly offset by a loss
on bunkers amounting to $0.1 million compared to a gain of $0.1 million in the same period of 2023. The
gain and loss on bunkers was mainly due to the difference in the price of bunkers paid by the Company
to the charterers on the redelivery of the vessels from the charterers under the previous charter party
agreements and the price of bunkers paid by charterers to the Company on the delivery of the same
vessels to their charterers under new charter party agreements.
Vessel operating expenses.
Vessel operating expenses decreased by $0.7 million, or 2%, to $42.1
million in the six months ended June 30, 2024, compared to $42.8 million in the six months ended June
30, 2023. The decrease in operating expenses is mainly attributable to the decrease in ownership days in
the six months ended June 30, 2024 by 306 days, which was due to the decrease in the size of the fleet.
The decrease in operating expenses was partly offset by increased costs, mainly in stores, supplies and
repairs and maintenance expenses. Total daily operating expenses were $5,883 in the six months ended
June 30, 2024, compared to $5,726 in the six months ended June 30, 2023.
Depreciation and amortization of deferred charges.
decreased by $4.6 million, or 17%, to $22.1 million in the six months ended June 30, 2024, compared to
$26.7 million in the six months ended June 30, 2023. This fluctuation was attributed to the decreased
depreciation due to the decrease in the size of the fleet and the change in the scrap rate from $250 per to
$400 per lightweight ton.
10
General and administrative expenses
. General and administrative expenses increased by $1.0 million, or
6%, to $16.7 million in the six months ended June 30, 2024, compared to $15.7 million in the six months
ended June 30, 2023. The increase was mainly due to the increased payroll costs, travelling expenses and
legal fees. A further increase was attributed due to increased cost on restricted stock resulting from
increased number of vested shares.
Management fees to related party.
months ended June 30, 2024, compared to $0.6 million in the six months ended June 30, 2023. The
increase is attributable to the increased average number of vessels managed by DWM
Gain on sale of vessels
. Gain on sale of vessels amounted to $1.6 million in the six months ended June
30, 2024, which is attributed to the sale of vessel Artemis during the first quarter of 2024, as compared to
$5.0 million in the six months ended June 30, 2023, which is attributed to the sale of vessels Aliki and
Melia during the first quarter of 2023.
Interest expense and finance costs.
million in the six months ended June 30, 2024, compared to $23.8 million in the six months ended June
30, 2023. The decrease is attributable to decreased lease interest expense and loan expenses during the
six months ended June 30, 2024 as compared to the same period in 2023. This decrease was partly
offset by increased interest expense due to increased average interest rates, also offset by decreased
average long-term debt.
Interest and other income
. Interest and other income increased by $0.1 million, or 3%, to $3.8 million in
the six months ended June 30, 2024, compared to $3.7 million in the six months ended June 30, 2023.
The increase is mainly attributable to the slightly increased average amount of time deposits.
Loss on extinguishment of debt
. Loss on extinguishment of debt decreased by $0.7 million, to nil as
compared to $0.7 million in the six months ended June 30, 2023, which is attributable to the loss derived
from the refinancing of our existing debt during the six months ended June 30, 2023.
Gain on derivative instruments.
Gain on derivative instruments amounted to $0.4 million in the six months
ended June 30, 2024, which is attributable to the gain from the interest rate swap with DNB which the
Company entered on July 6, 2023.
Gain/(loss) on investments.
Loss on investments amounted to $1.8 million in the six months ended June
30, 2024, compared to a gain of $0.8 million for the same period of 2023 which mainly derives from the
fair value measurement of the investment in OceanPal, resulting in a loss of $1.4 million. A further loss of
$0.4 million attributed to the equity securities that the Company invested and sold during the first quarter
of 2024. In the six months ended June 30, 2023, gain on investments amounted $0.8 million, attributed to
the gain that resulted from the distribution of the investment in Series D preferred shares from the sale of
vessel Melia to the Company’s common stockholders, being the difference between the fair value and the
carrying value of the investment.
Gain on deconsolidation of subsidiary.
Gain on deconsolidation of subsidiary decreased by $0.8 million, to
nil as compared to $0.8 million in the six months ended June 30, 2023, which derived from the
deconsolidation of a wholly owned subsidiary of our Company, named Bergen Ultra LP, on April 28,
2023.
11
Loss on warrants.
Loss on warrants amounted to $6.8 million in the six months ended June 30, 2024,
which is mainly attributable from the remeasurement of warrant liability and the gain or loss from the
settlement of the warrants that were exercised in the six months ended June 30, 2024.
Gain/(loss) from equity method investments.
Loss from equity method investments amounted to $0.2
million in the six months ended June 30, 2024, compared to a gain of $0.2 million six months ended June
30, 2023, which is mainly attributed due to the loss from the investment in Windward. This decrease was
partially offset due to the gain from the investment in DWM and Bergen Ultra.
B. Liquidity and Capital Resources
Our short-term liquidity requirements include paying operating expenses, payment of dividends, funding
working capital requirements, interest and principal payments on outstanding debt and the equity portion
of our newbuilding vessel installments and maintaining cash reserves to strengthen our position against
adverse fluctuations in operating cash flows. Our primary sources of short-term liquidity are cash
generated from operating activities, available cash balances and portions from debt and equity
financings.
Our long-term liquidity requirements are funding vessel acquisitions and debt repayment. Sources of
funding for our long-term liquidity requirements include cash flows from operations, bank borrowings,
issuance of debt and equity securities, and vessel sales
As of June 30, 2024, and December 31, 2023, working capital, which is current assets minus current
liabilities, including the current portion of long-term debt, amounted to $88.8 million and $97.1 million,
respectively.
Cash and cash equivalents, including restricted cash, was $120.0 million on June 30, 2024, and $121.6
million on December 31, 2023. Restricted cash consists of the minimum liquidity requirements under our
loan facilities. As of June 30, 2024, and December 31, 2023, restricted cash, current and non-current,
amounted to $19.5 million and $20.0 million, respectively. We consider highly liquid investments such as
time deposits and certificates of deposit with an original maturity of around three months or less to be
cash equivalents. Cash and cash equivalents are primarily held in U.S. dollars.
Net Cash Provided by Operating Activities
Net cash provided by operating activities decreased by $3.4 million, or 6%. In 2024, net cash provided by
operating activities was $49.2 million compared to net cash provided by operating activities of
$52.6 million in the six months ended June 30, 2023. This decrease in cash from operating activities was
mainly due to decreased revenues because of lower time charter rates that our vessels earned compared
to the same period last year. This decrease was partly offset by the sale of the equity securities during
the first quarter of 2024.
Net Cash Provided by/(Used in) Investing Activities
Net cash used in investing activities was $13.6 million for the six months ended June 30, 2024, which
consists of $16.7 million paid for vessel acquisitions and improvements due to new regulations; $12.5
million of proceeds from the sale of vessel Artemis during the first quarter of 2024; $26.7 million paid
mainly for the investment in Windward consisting of advances to fund the construction of four vessels
and working capital; $2.8 million paid to acquire property and other assets and $20.0 million of proceeds
from time deposits that were placed prior year on time deposits with maturities of over three months.
12
Net cash provided by investing activities was $5.9 million for the six months ended June 30, 2023, which
consists of $29.1 million paid for vessel acquisitions and improvements due to new regulations; $18.6
million of proceeds from the sale of vessels Aliki and Melia during the first quarter of 2023; $25.2 million
proceeds from convertible loan with limited partnership; $0.5 million paid to acquire property and other
assets; $0.8 million cash divested from deconsolidation and $7.5 million placed on time deposits with
maturities of over three months.
Net Cash Used in Financing Activities
Net cash used in financing activities was $37.1 million for the six months ended June 30, 2024, which
consists of $14.7 million proceeds from issuance of common stock; $30.5 million of indebtedness that we
repaid; and $2.9 million and $18.4 million of dividends paid on our Series B Preferred Stock and common
stock, respectively.
Net cash used in financing activities was $12.2 million for the six months ended June 30, 2023, which
consists of $57.7 million net proceeds relating to the refinance of our loans; $0.1 million paid for issuance
of common stock; $49.4 million of indebtedness that we repaid; $2.9 million and $15.9 million of
dividends paid on our Series B Preferred Stock and common stock, respectively; and $1.6 million paid for
finance costs, associated with the refinancing of our loans.
F-1
Page
DIANA SHIPPING INC.
INDEX TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Balance Sheets as of June 30, 2024 (unaudited) and December 31, 2023 ......
F-2
Unaudited Consolidated Statements of Comprehensive income for the six months ended
June 30, 2024 and 2023 ................................ ................................ ................................ .........
F-3
Unaudited Consolidated Statements of Stockholders' Equity for the six months ended June
30, 2024 and 2023 ................................................................ ................................ .................
F-4
Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2024
and 2023 ................................ ................................ ................................ ................................
F-5
Notes to Unaudited Interim Consolidated Financial Statements ................................ .............
F-7
F-2
DIANA SHIPPING INC.
CONSOLIDATED BALANCE SHEETS
June 30, 2024 (unaudited) and December 31, 2023
(Expressed in thousands of U.S. Dollars – except for share and per share data)
June 30, 2024
December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents
$
$
Time deposits (Note 2)
Accounts receivable, trade
Due from related parties (Note 4)
Inventories
Prepaid expenses and other assets
Investments in equity securities
Vessel held for sale
Fair value of derivatives
Total Current Assets
Fixed Assets:
Advances for vessels under construction (Note 6)
Vessels, net (Note 6)
Property and equipment, net (Note 7)
Total fixed assets
Other Noncurrent Assets
Restricted cash, non-current (Note 8)
Due from related parties, non-current (Note 4)
Equity method investments (Note 4)
Investments in related party (Note 5(a))
Other non-current assets
Deferred costs
Total Non-current Assets
Total Assets
$
$
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt, net of deferred financing costs (Note 8)
$
$
Current portion of finance liabilities, net of deferred financing costs (Note 9)
Accounts payable
Due to related parties (Note 3)
Accrued liabilities
Deferred revenue
Total Current Liabilities
Non-current Liabilities
Long-term debt, net of current portion and deferred financing costs (Note 8)
Finance liabilities, net of current portion and deferred financing costs (Note 9)
Fair value of derivatives
Warrant liability (Note 11(e))
Other non-current liabilities
Total Noncurrent Liabilities
Commitments and contingencies (Note 10)
-
-
Stockholders' Equity
Preferred stock (Note 11)
Common stock, $
respectively (Note 11)
Additional paid in capital
Accumulated other comprehensive income
Accumulated deficit
(635,827 )
(613,869 )
Total Stockholders' Equity
$
$
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-3
DIANA SHIPPING INC.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
For the six months ended June 30, 2024 and 2023
(Expressed in thousands of U.S. Dollars – except for share and per share data)
2024
2023
REVENUES:
Time charter revenues
$
$
OPERATING EXPENSES
Voyage expenses
Vessel operating expenses
Depreciation and amortization of deferred charges
General and administrative expenses
Management fees to a related party (Note 4(a))
Gain on sale of vessels (Note 6)
(1,572 )
(4,995 )
Other operating income
(389 )
(189 )
Operating income, total
$
$
OTHER INCOME / (EXPENSES):
Interest expense and finance costs (Note 12)
(23,650 )
(23,845 )
Interest and other income
Gain on derivative instruments (Note 8)
Loss on extinguishment of debt
(748 )
Gain on deconsolidation of subsidiary
Gain/(loss) on investments (Note 5)
(1,751 )
Loss on warrants (Note 11(e))
(6,773 )
Gain/(loss) from equity method investments (Note 4)
(231 )
Total other expenses, net
$
(28,268 )
$
(18,998 )
Net comprehensive income/(loss)
$
(706 )
$
Dividends on series B preferred shares (Notes 11(b) and 13)
(2,884 )
(2,884 )
Net comprehensive income/(loss) attributable to common stockholders
$
(3,590 )
$
Earnings/(loss) per common share, basic
$
(0.03 )
$
Earnings/(loss) per common share, diluted
$
(0.03 )
$
Weighted average number of common shares outstanding, basic
13)
Weighted average number of common shares outstanding, diluted
13)
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-4
DIANA SHIPPING INC.
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
For the six months ended June 30, 2024 and 2023
(Expressed in thousands of U.S. Dollars – except for share and per share data)
Preferred Stock
Series B
Preferred Stock
Series C
Preferred Stock
Series D
Common Stock
# of
Shares
Par
Value
# of
Shares
Par
Value
# of
Shares
Par
Value
# of Shares
Par
Value
Additional
Paid-in
Capital
Other
Comprehensive
Income
Accumulated
Deficit
Total Equity
BALANCE, December
31, 2022
$
$
$
$
$
$
$
(574,993 )
Net Income
-
-
-
-
-
-
-
-
-
-
Issuance of Common
Stock
-
-
-
-
-
-
-
-
Issuance of Restricted
Stock and
Compensation Cost
(Note 8(g))
-
-
-
-
-
-
-
-
Dividends on Common
Stock
-
-
-
-
-
-
-
-
-
-
(31,931 )
(31,931 )
Dividends on Preferred
Stock (Note 8(b))
-
-
-
-
-
-
-
-
-
-
(2,884 )
(2,884 )
Dividends in Kind
-
-
-
-
-
-
-
-
-
-
(10,761 )
(10,761 )
BALANCE, June 30,
2023
$
$
$
$
$
$
$
(587,492 )
$
BALANCE, December
31, 2023
$
$
$
$
$
$
$
(613,869 )
$
Net loss
-
-
-
-
-
-
-
-
-
-
(706 )
(706 )
Issuance of Common
Stock (Note 11(e)
-
-
-
-
-
-
-
-
Issuance of Restricted
Stock and
Compensation Cost
(Note 11(g))
-
-
-
-
-
-
-
-
Dividends on Common
Stock (Note 11(f))
-
-
-
-
-
-
-
-
-
-
(18,368 )
(18,368 )
Dividends on Preferred
Stock (Note 11(b))
-
-
-
-
-
-
-
-
-
-
(2,884 )
(2,884 )
BALANCE, June 30,
2024
$
$
$
$
$
$
$
(635,827 )
$
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-5
DIANA SHIPPING INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2024 and 2023
(Expressed in thousands of U.S. Dollars)
2024
2023
Net income/(loss)
$
(706 )
$
Adjustments to reconcile net income/(loss) to cash provided by operating
activities
Depreciation and amortization of deferred charges
Amortization of debt issuance costs (Note 12)
Compensation cost on restricted stock (Note 11(g))
Gain on derivative instruments (Note 8)
(361 )
Gain on sale of vessels (Notes 6)
(1,572 )
(4,995 )
(Gain)/loss on investments (Note 5)
(761 )
Loss on extinguishment of debt
Gain on deconsolidation of subsidiary
(844 )
(Gain)/loss from equity method investments (Note 4)
(244 )
Loss on warrants (Note 11(e))
(Increase) / Decrease
Accounts receivable, trade
(1,408 )
Due from related parties
Inventories
(95 )
Prepaid expenses and other assets
(43 )
(2,833 )
Other non-current assets
(409 )
Investments in equity securities
Increase / (Decrease)
Accounts payable, trade and other
(960 )
Due to related parties
(540 )
Accrued liabilities
(2,139 )
(987 )
Deferred revenue
(416 )
(1,978 )
Other non-current liabilities
Drydock cost
(2,114 )
(2,947 )
Net Cash Provided by Operating Activities
$
$
Payments for vessels under construction and vessel improvements (Note 6)
(16,702 )
(29,125 )
Proceeds from sale of vessels, net of expenses (Note 6)
Payments to acquire investments (Note 4)
(26,671 )
Time deposits (Note 2)
(7,500 )
Payments to acquire other assets
(216 )
Cash divested from deconsolidation
(771 )
Proceeds from convertible loan with limited partnership
Payments to acquire property, furniture and fixtures (Note 7)
(2,755 )
(308 )
Net Cash Provided by / (Used in) Investing Activities
$
(13,624 )
$
Proceeds from issuance of long-term debt and finance liabilities
Proceeds from issuance of common stock, net of expenses (Note 11(e))
(76 )
Payments of dividends, preferred stock (Note 11(b))
(2,884 )
(2,884 )
Payments of dividends, common stock (Note 11(f))
(18,368 )
(15,965 )
Payments of financing costs (Notes 8 and 9)
(1,656 )
Repayments of long-term debt and finance liabilities (Notes 8 and 9)
(30,539 )
(49,353 )
Net Cash Used In Financing Activities
$
(37,110 )
$
(12,238 )
Cash, Cash Equivalents and Restricted Cash, Period Increase/(Decrease)
(1,551 )
Cash, Cash Equivalents and Restricted Cash, Beginning Balance
Cash, Cash Equivalents and Restricted Cash, Ending Balance
$
$
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents
$
$
Restricted cash, non-current
Cash, Cash Equivalents and Restricted Cash, Total
$
$
F-6
SUPPLEMENTAL CASH FLOW INFORMATION
Non-cash acquisition of assets
$
$
Stock issued in noncash financing activities (Note 11(e))
Non-cash investments acquired
Noncash dividend
Interest paid, net of amounts capitalised
$
$
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-7
1. Basis of Presentation and General Information and Recent Accounting
Pronouncements
The accompanying unaudited interim consolidated financial statements include the accounts of Diana
Shipping Inc., or DSI and its wholly owned subsidiaries (collectively, the “Company”). DSI was formed on
March 8, 1999 as Diana Shipping Investment Corp. under the laws of the Republic of Liberia. In February
2005, the Company’s articles of incorporation were amended. Under the amended articles of
incorporation, the Company was renamed Diana Shipping Inc. and was re-domiciled from the Republic of
Liberia to the Republic of the Marshall Islands.
The accompanying unaudited interim consolidated financial statements have been prepared in
accordance with U.S. generally accepted accounting principles, or U.S. GAAP, for interim financial
information. Accordingly, they do not include all the information and notes required by U.S. GAAP for
complete financial statements. These unaudited interim consolidated financial statements have been
prepared on the same basis and should be read in conjunction with the financial statements for the year
ended December 31, 2023 included in the Company’s Annual Report on Form 20-F filed with the
Securities and Exchange Commission on April 5, 2024 and, in the opinion of management, reflect all
adjustments, which include only normal recurring adjustments considered necessary for a fair
presentation of the Company's financial position, results of operations and cash flows for the periods
presented. Operating results for the six months ended June 30, 2024, are not necessarily indicative of
the results that might be expected for the fiscal year ending December 31, 2024.
The consolidated balance sheet as of December 31, 2023, has been derived from the audited
consolidated financial statements as of that date, but does not include all information and footnotes
required by U.S. GAAP for complete financial statements.
The Company is engaged in the ocean transportation of dry bulk cargoes worldwide mainly through the
ownership and bareboat charter in of dry bulk carrier vessels. The Company operates its own fleet
through Diana Shipping Services S.A. (or “DSS”), a wholly owned subsidiary and through Diana
Wilhelmsen Management Limited, or DWM, a
% owned joint venture (Note 4(a)). The fees paid to DSS
are eliminated on consolidation.
2. Short-Term Investments
The Company places time deposits with maturities exceeding three months. As of June 30, 2024 and
December 31, 2023, Time deposits amounted to $
, respectively, separately
presented as Time deposits in the accompanying consolidated balance sheets. During the six months
ended June 30, 2024 and 2023, the Company placed new time deposits exceeding three months of
nil
and $
, respectively, and during the same periods, deposits of $
3. Transactions with related parties
a) Altair Travel Agency S.A. (“Altair”):
agent, Altair, which is controlled by the Company’s CEO Mrs. Semiramis Paliou. Travel expenses for the
six months ended June 30, 2024 and 2023 amounted to $
, respectively, and are mainly
included in vessel operating expenses and general and administrative expenses in the accompanying
unaudited interim consolidated statements of comprehensive income/(loss). As of June 30, 2024 and
December 31, 2023, an amount of $
, respectively, was due to Altair, included in due to
related parties in the accompanying consolidated balance sheets.
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-8
b) Steamship Shipbroking Enterprises Inc. or Steamship:
our CEO Mrs. Semiramis Paliou. Steamship provides brokerage services to DSI for a fixed monthly fee
plus commissions on the sale and purchase of vessels, pursuant to a Brokerage Services Agreement
dated February 23, 2024. For the six months ended June 30, 2024 and 2023, brokerage fees amounted
to $
, respectively, included in general and administrative expenses in the
accompanying unaudited interim consolidated statements of comprehensive income/(loss). For the six
months ended June 30, 2024 and 2023, the Company also paid commissions on the sale and purchase
of vessels which amounted to $
, respectively, included in the gain on sale of vessels in the
accompanying unaudited interim consolidated statements of comprehensive income/(loss). As of June
30, 2024 and December 31, 2023, an amount of $
, respectively, was due to Steamship,
included in due to related parties in the accompanying consolidated balance sheets.
4. Equity Method Investments
a) Diana Wilhelmsen Management Limited, or DWM:
Management Inc., a wholly owned subsidiary of DSI, and Wilhelmsen Ship Management Holding AS, an
unaffiliated third party, each holding
% of DWM. As of June 30, 2024 and December 31, 2023, the
investment in DWM amounted to $
accompanying consolidated balance sheets. For the six months ended June 30, 2024 and 2023, the
investment in DWM resulted in a gain of $
, respectively, included in gain/(loss) from equity
method investments in the accompanying unaudited interim consolidated statements of comprehensive
income/(loss).
DWM provides commercial and technical management to six of the Company’s vessels for a fixed
monthly fee and a percentage of their gross revenues. Management fees for the six months ended June
30, 2024 and 2023 amounted to $
, respectively, and are separately presented as
management fees to related party in the accompanying unaudited interim consolidated statements of
comprehensive income/(loss). Commissions during the six months ended June 30, 2024 and 2023
amounted to $
, respectively, and are included in voyage expenses, in the accompanying
unaudited interim consolidated statements of comprehensive income/(loss). As of June 30, 2024 and
December 31, 2023, there was an amount of $
, respectively, due from DWM included in due
from related parties in the accompanying consolidated balance sheets.
b) Bergen Ultra LP, or Bergen:
purpose of acquiring, owning, chartering and/or operating a vessel and in which the Company has
partnership interests of
%. For the six months ended June 30, 2024 and 2023, the investment in
Bergen resulted in gain of $
, respectively and is included in gain/(loss) on investments in the
accompanying unaudited interim consolidated statements of comprehensive income/(loss). As of June
30, 2024 and December 31, 2023, the investment in Bergen amounted to $
,
respectively, and is included in equity method investments in the accompanying consolidated balance
sheets.
The Company has an administrative agreement with Bergen under which it provides administrative
services and a commission agreement under which it guarantees Bergen’s loan and receives a
commission of
% per annum on the outstanding balance of the loan, paid quarterly (Note 10). For the
six months ended June 30, 2024 and 2023, income from management fees from Bergen amounted to $
and $
, respectively, included in time charter revenues and income from the commission paid on the loan
guarantee amounted to $
, respectively, included in interest and other income in the 2024
accompanying unaudited interim consolidated statement of comprehensive income/(loss). As of June 30,
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-9
2024, and December 31, 2023, there was an amount of $
, respectively, due from Bergen
included in due from related parties, current and non-current.
c) Windward Offshore GmbH, or Windward:
wholly owned subsidiary Diana Energize Inc., or Diana Energize, entered into a joint venture agreement,
with
Germany, for the purpose of establishing and operating an offshore wind vessel company with the aim of
becoming a leading provider of service vessels to the growing offshore wind industry and acquire certain
vessels. Diana Energize agreed to contribute
% of the limited partnership’s
capital and as of June 30, 2024 and December 31, 2023, the investment amounted to $
$
, respectively, mainly consisting of advances to fund the construction of
capital. For the six months ended June 30, 2024, the investment in Windward resulted in a loss of $
and is included in gain/(loss) from equity method investments in the six months ended June 30, 2024
accompanying unaudited interim consolidated statement of comprehensive income/(loss).
d) Cohen Global Maritime Inc., or Cohen:
wholly owned subsidiary Cebu Shipping Company Inc., or Cebu, acquired
% of Cohen, a company
organized in the Republic of the Philippines for the purpose of engaging in the manning agency business.
As of June 30, 2024 and December 31, 2023, the Company’s investment in Cohen amounted to $
and $
, respectively, consisting of set up costs and advances paid to acquire the license required to
engage in the manning agency business.
5. Investments in related parties and other
a) OceanPal Inc., or OceanPal:
holder of
OceanPal and
% of OceanPal’s common stock.
Series B preferred shares entitle the holder to
stockholders of the Company, provided however, that the total number of votes shall not exceed
% of
the total number of votes, provided further, that the total number of votes entitled to vote, including
common stock or any other voting security, would not exceed
% of the total number of votes. Series B
Preferred Shares have no dividend or distribution rights.
Series C preferred shares do not have voting rights unless related to amendments of the Articles of
Incorporation that adversely alter the preference, powers or rights of the Series C Preferred Shares or to
issue Parity Stock or create or issue Senior Stock. Series C preferred shares have a liquidation
preference equal to the stated value of $
option commencing upon the first anniversary of the issue date, at a conversion price equal to the lesser
of $
-trading day trailing VWAP of OceanPal’s common shares, subject to adjustments.
Dividends on each share of Series C Preferred Shares are cumulative and accrue at the rate of
% per
annum. Dividends are payable in cash or, at OceanPal’s election, in kind.
As of June 30, 2024 and December 31, 2023, the Company’s investment in the common stock of
OceanPal amounted to $
, respectively, being the fair value of OceanPal’s common
shares on that date, determined through Level 1 inputs of the fair value hierarchy, and the Company
recorded an unrealized loss on investment of $
, included in gain/(loss) on investments, in the
accompanying unaudited interim consolidated statements of comprehensive income/(loss).
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-10
As of June 30, 2024 and December 31, 2023, the Company’s investment in Series B preferred shares
and Series C preferred shares, amounted to $
, respectively, included in investments in
related parties in the accompanying consolidated balance sheets.
For the six months ended June 30, 2024 and 2023, dividend income from the Series C and Series D
OceanPal preferred shares amounted to $
, respectively, included in interest and other income
in the accompanying unaudited interim consolidated statements of comprehensive income/(loss).
b) Investment in equity securities:
additional amount of $
2023 had a fair value of $
. The Company sold all securities during the first quarter resulting in loss
of $
statements of comprehensive income/(loss).
6. Advances for vessels under construction and Vessels, net
It is in the Company’s normal course of business from time to time to acquire and sell vessels.
Accordingly, for the six months ended June 30, 2024, the Company entered into the below transactions.
Vessels under construction
On February 8, 2024, the Company signed an agreement to order through Marubeni Corporation or its
guaranteed nominee, an unaffiliated third party,
Kamsarmax dry bulk vessels, for a purchase price of $
Shipbuilding Inc., China. The vessels are expected to be delivered to the Company by the second half of
2027 and the first half of 2028 respectively. On February 15, 2024, the Company paid the first instalment,
which amounted to $
% of the contract price. As of June 30,
2024, advances for vessels under construction amounted to $
, including $
interest.
Vessel Disposals
On January 19, 2024, the Company, through a wholly owned subsidiary, entered into an agreement with
an unrelated third party to sell the vessel Artemis for the sale price of $
, resulted in gain amounting
to $
. The vessel was delivered to the new owners on March 5, 2024.
On February 22, 2024, the Company, through a wholly owned subsidiary, entered into an agreement with
an unrelated third party to sell the vessel Houston for the sale price of $
. The vessel was delivered
to the new owners on September 4, 2024 (Note 15).
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-
11
The amount reflected in Vessels, net in the accompanying consolidated balance sheets is analyzed as
follows:
Vessel Cost
Accumulated
Depreciation
Net Book
Value
Balance, December 31, 2023
$
$
(214,055 )
$
- Additions for vessel improvements
-
- Vessel disposals
(20,993 )
(10,727 )
- Depreciation for the period
-
(19,260 )
(19,260 )
- Vessel held for sale
(25,008 )
(18,425 )
Balance, June 30, 2024
$
$
(216,466 )
$
7. Property and Equipment, net
The Company owns the land and building of its principal corporate offices in Athens, Greece and a plot of
a land. During the first quarter of 2024, the Company acquired from unaffiliated third parties a plot of land
for the purchase price of Euro
.
Other assets consist of office furniture and equipment, computer software and hardware and vehicles.
The amount reflected in “Property and equipment, net” is analyzed as follows:
Property and
Equipment
Accumulated
Depreciation
Net Book
Value
Balance, December 31, 2023
$
$
(6,660 )
$
- Additions in property and equipment
-
- Depreciation for the period
-
(379 )
(379 )
Balance, June 30, 2024
$
$
(7,039 )
$
8. Long-term debt
The amount of long-term debt shown in the accompanying consolidated balance sheets is analyzed as
follows:
2024
2023
Senior unsecured bond
Secured long-term debt
Total long-term debt
$
$
Less: Deferred financing costs
(5,170 )
(6,314 )
Long-term debt, net of deferred financing costs
$
$
Less: Current long-term debt, net of deferred financing costs,
current
(47,277 )
(49,512 )
Long-term debt, excluding current maturities
$
$
Senior Unsecured Bond
:
On
, the Company issued a $
bond ranks ahead of subordinated capital and ranks the same with all other senior unsecured obligations
of the Company other than obligations which are mandatorily preferred by law. Entities affiliated with
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-12
executive officers and directors of the Company purchased an aggregate of $
the bond. The bond bears interest at a US Dollar fixed-rate coupon of
% and is payable semi-
annually in arrears in June and December of each year. The bond is callable in whole or in part in June
2024 at a price equal to
% of nominal value; between June 2025 to December 2025 at a price
equal to
% of nominal value and after December 2025 at a price equal to
% of nominal value.
On June 29, 2023, the Company repurchased $
. The bond
includes financial and other covenants and is trading at Oslo Stock Exchange under the ticker symbol
“DIASH02”.
In June 2024, the Company agreed to refinance the bond with a new issue in the amount of $
maturing in 2029 at a fixed rate coupon of
% (Note 15).
Secured Term Loans:
Under the secured term loans outstanding as of June 30, 2024,
mortgaged with first preferred or priority ship mortgages, having an aggregate carrying value of
$
. Additional securities required by the banks include first priority assignment of all earnings,
insurances, first assignment of time charter contracts that exceed a certain period, pledge over the
shares of the borrowers, manager’s undertaking and subordination and requisition compensation and
either a corporate guarantee by DSI (the “Guarantor”) or a guarantee by the ship owning companies
(where applicable), financial covenants, as well as operating account assignments. The lenders may also
require additional security in the future in the event the borrowers breach certain covenants under the
loan agreements. The secured term loans generally include restrictions as to changes in management
and ownership of the vessels, additional indebtedness, as well as minimum requirements regarding hull
cover ratio and minimum liquidity per vessel owned by the borrowers, or the Guarantor, maintained in the
bank accounts of the borrowers, or the Guarantor.
As of June 30, 2024 and December 31, 2023 minimum cash deposits required to be maintained at all
times under the Company’s loan facilities, amounted to $
, respectively and are
included in restricted cash, non-current in the accompanying consolidated balance sheets. Furthermore,
the secured term loans contain cross default provisions and additionally the Company is not permitted to
pay any dividends following the occurrence of an event of default.
As of June 30, 2024, the Company had the following agreements with banks, either as a borrower or as a
guarantor, to guarantee the loans of its subsidiaries:
Nordea Bank AB, London Branch (“Nordea”):
$
down $
$
equal
, and a balloon of $
together with the last instalment on
. The loan bears interest at term SOFR plus a
margin of
%.
On June 27, 2023, the Company drew down $
bank. The loan is repayable in
SOFR plus a margin of
%. The loan matures on
.
Export-Import Bank of China:
loan agreement, which is repayable in equal
, each, until its maturity on
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-13
%.
DNB Bank ASA or DNB:
which was drawn on June 27, 2023, to refinance the outstanding balance of the ABN loans mentioned
above and for working capital purposes. The loan is repayable in
$
, and bears term SOFR plus a margin of
%, subject to sustainability
margin adjustment. Additionally, the loan is subject to a margin reset, according to which the borrowers
and the lenders will enter into discussions to agree on a new margin. Unless the parties agree on a new
margin, the loan will be mandatorily repayable on June 27, 2027. As part of the loan agreement, on July
6, 2023, the Company entered into an interest rate swap with DNB for a notional amount of $
,
being
% of the loan amount and quarterly amortization of $
. Under the interest rate swap, the
Company pays a fixed rate of
% and receives floating under term SOFR, has a trade date on June
27, 2023, and termination date on December 27, 2029, and also has a mandatory break on June 27,
2027, the margin reset date of the loan, according to which the swap will be terminated if the loan is
prepaid. As of June 30, 2024 and December 31, 2023, the fair value of the interest rate swap amounted
to $
, respectively, and is separately presented in current assets and non-current liabilities.
For the six months ended June 30, 2024, gain from the interest rate swap amounted to $
separately presented as gain on derivative instruments in the 2024 accompanying unaudited interim
consolidated statement of comprehensive income/(loss).
Danish Ship Finance A/S or Danish:
Danish, for $
and BNP, mentioned above and working capital. On April 18 and 19, 2023, the Company drew down
$
balloon of $
SOFR plus a margin of
%.
As of June 30, 2024 and December 31, 2023, the Company was in compliance with all of its loan
covenants.
As of June 30, 2024, the maturities of the Company’s bond and debt facilities throughout their term, are
shown in the table below and have been adjusted to take into account the refinancing of the
agreements with Nordea with a new loan agreement (Note 15(d)) and the issuance of the new Bond
(Note 15(b)). The table below does not include related debt issuance costs.
Period
Principal Repayment
Year 1
$
Year 2
Year 3
Year 4
Year 5
Year 6 and thereafter
Total
$
9. Finance Liabilities
The amount of finance liabilities shown in the accompanying consolidated balance sheet is analyzed as
follows:
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-14
June 30, 2024
December 31, 2023
Finance liabilities
Less: Deferred financing costs
(1,099 )
(1,208 )
Finance liabilities, net of deferred financing costs
$
$
Less: Current finance liabilities, net of deferred financing costs,
current
(9,398 )
(9,221 )
Finance liabilities, excluding current maturities
$
$
On March 29, 2022, the Company sold
Florida
the vessel under a bareboat agreement, for a period of
, under which the Company pays hire,
monthly in advance. Under the bareboat charter, the Company has the option to repurchase the vessel
after the end of the third year of the charter period, or each year thereafter, until the termination of the
lease, at specific prices, subject to irrevocable and written notice to the owner. If not repurchased earlier,
the Company has the obligation to repurchase the vessel for $
, on the expiration of the lease on
the tenth year.
On August 17, 2022, the Company entered into
Japanese third parties for
New Orleans
Santa Barbara,
for an aggregate amount of $
. The
vessels were delivered to their buyers on September 8, 2022 and September 12, 2022, respectively and
the Company chartered in both vessels under bareboat charter parties for a period of
, each,
and has purchase options beginning at the end of the third year of each vessel's bareboat charter period,
or each year thereafter, until the termination of the lease, at specific prices, subject to irrevocable and
written notice to the owner. If not repurchased earlier, the Company has the obligation to repurchase the
vessels for $
, each, on the expiration of each lease on the eighth year.
On December 6, 2022, the Company sold
DSI Andromeda
leased back the vessel under a bareboat agreement, for a period of
, under which the Company
pays hire, monthly in advance. Under the bareboat charter, the Company has the option to repurchase
the vessel after the end of the third year of the charter period, or each year thereafter, until the
termination of the lease, at specific prices, subject to irrevocable and written notice to the owner. If not
repurchased earlier, the Company has the obligation to repurchase the vessel for $
, on the
expiration of the lease on the tenth year.
Under the bareboat charter parties, the Company is responsible for the operation and maintenance of the
vessels and the owner of the vessels shall not retain any control, possession, or command of the vessel
during the charter period.
The Company determined that, under ACS 842-40 Sale and Leaseback Transactions, the transactions
are failed sales and consequently the assets were not derecognized from the financial statements and
the proceeds from the sale of the vessels were accounted for as financial liabilities. As of June 30, 2024,
the weighted average remaining lease term of the above lease agreements was
interest rate was
% and the sublease income during the six months ended June 30, 2024 was
$
, included in time charter revenues.
As of June 30, 2024, and throughout the term of the leases, the Company has annual finance liabilities
as shown in the table below:
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-15
Period
Principal Repayment
Year 1
$
Year 2
Year 3
Year 4
Year 5
Year 6 and thereafter
Total
$
10. Commitments and Contingencies
a)
liability, arise in the ordinary course of the shipping business. In addition, losses may arise from
disputes with charterers, agents, insurance and other claims with suppliers relating to the operations
of the Company’s vessels. The Company accrues for the cost of environmental and other liabilities
when management becomes aware that a liability is probable and is able to reasonably estimate the
probable exposure. The Company’s vessels are covered for pollution in the amount of $
vessel per incident, by the P&I Association in which the Company’s vessels are entered.
b)
counterparties, the Company has purchase obligations to repurchase the vessels
Florida, Santa
Barbara, New Orleans
and
upon expiration of their lease contracts, as described in
Note 9.
c)
Company guarantees the performance by Bergen of all of its obligations under the loan until the
maturity of the loan on March 30, 2028 (Note 4 (b)). The Company considers the likelihood of having
to make any payments under the guarantee to be remote, as the loan is also secured by an account
pledge by Bergen, first preferred mortgage on the vessel, a first priority general assignment of the
earnings, insurances and requisition compensation of the vessel, a charter party assignment, a
partnership interests security deed, and a manager’s undertaking. Accordingly, as of June 30, 2024,
the Company did not record a provision for losses under the guarantee of Bergen’s loan amounting to
$
d)
$
e)
agreements, considered operating leases. The minimum contractual gross charter revenue expected
to be generated from fixed and non-cancelable time charter contracts existing as of June 30, 2024
and until their expiration was as follows:
Period
Amount
Year 1
$
Year 2
Year 3
$
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-16
11. Capital Stock and Changes in Capital Accounts
a) Preferred stock
:
preferred stock consists of
share, of which
shares are designated as Series B Preferred Shares,
Preferred Shares and
December 31, 2023, the Company had
outstanding.
b) Series B Preferred Stock:
per share and with liquidation preference at $
shares with respect to dividends, distributions and payments upon liquidation and are subordinated to all
of the existing and future indebtedness.
Dividends on the Series B Preferred Shares are cumulative from the date of original issue and are
payable on the 15th day of January, April, July and October of each year at the dividend rate of
%
per annum, or $
dividends on Series B Preferred Shares amounted to $
, respectively. Since February
14, 2019, the Company may redeem, in whole or in part, the Series B Preferred Shares at a redemption
price of $
date of redemption, whether or not declared.
c) Series C Preferred Stock
: As of June 30, 2024, and December 31, 2023, the Company had
owned by an affiliate of its Chief Executive Officer, Mrs. Semiramis Paliou.
no dividend or liquidation rights and cannot be transferred without the consent of the Company except to
the holder’s affiliates and immediate family members.
d) Series D Preferred Stock
: As of June 30, 2024, and December 31, 2023, the Company had
shares of Series D Preferred Stock, issued and outstanding, with par value $
affiliate of its Chief Executive Officer, Mrs. Semiramis Paliou. The Series D Preferred Stock is not
redeemable and has
provided however, that, notwithstanding any other provision of the Series D Preferred Stock statement of
designation, to the extent that the total number of votes one or more holders of Series D Preferred Stock
is entitled to vote (including any voting power of such holders derived from Series D Preferred Stock,
shares of Common Stock or any other voting security of the Company issued and outstanding as of the
date hereof or that may be issued in the future) on any matter submitted to a vote of stockholders of the
Company would exceed
% of the total number of votes eligible to be cast on such matter, the total
number of votes that holders of Series D Preferred Stock may exercise derived from the Series D
Preferred Stock together with Common Shares and any other voting securities of the Company
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-17
beneficially owned by such holder, shall be reduced to
% of the total number of votes that may be cast
on such matter submitted to a vote of stockholders.
e) Issuance of Common Shares:
On January 30, 2023, the Company issued
shares, at $
, to Sea Trade upon exercise by Sea Trade of a warrant it held for the acquisition of a
vessel. The Company did
t receive any proceeds from the exercise of the warrants by Sea Trade and
the exercise price of the shares issued was included in the price of the vessels acquired.
During the first
half of 2024, the Company issued
, net of
expenses, or $
dividend, on December 14, 2023, to the Company’s shareholders. The Company received $
proceeds, net of fees, from the exercise of the warrants.
If all warrants were exercised as of June 30, 2024, the Company would have issued
shares with a fair value of $
were measured on the date of distribution at fair value, determined through level 1 account hierarchy,
being the opening price of the warrants on the NYSE on the date of distribution as they are listed under
the ticker DSX_W. As of June 30, 2024 and December 31, 2023, the warrant liability, measured at fair
value, amounted to $
, respectively. During the six months ended June 30, 2024, loss
from warrants amounted to $
comprehensive income/(loss).
f) Dividend on Common Stock:
On March 12, 2024, the Company paid a cash dividend on its
common stock of $
18, 2024, the Company paid a cash dividend on its common stock of $
, to
shareholders of record as of June 12, 2024.
g) Incentive Plan:
As of June 30, 2024,
according to the Company’s incentive plan.
Restricted stock for the six months ended June 30, 2024 and 2023 is analyzed as follows:
Number of Shares
Weighted Average
Grant Date Price
Outstanding as of December 31, 2022
$
Granted
Vested
(2,822,753 )
Outstanding as of June 30, 2023
$
Outstanding as of December 31, 2023
$
Granted
Vested
(2,996,334 )
Outstanding as of June 30, 2024
$
The fair value of the restricted shares has been determined with reference to the closing price of the
Company’s stock on the date such awards were approved by the Company’s board of directors. The
aggregate compensation cost is recognized ratably in the consolidated statement of income/(loss) over
the respective vesting periods. For the six months ended June 30, 2024 and 2023, compensation cost
amounted to $
, respectively, and is included in general and administrative expenses in
the accompanying unaudited interim consolidated statements of comprehensive income/(loss).
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-18
As of June 30, 2024 and December 31, 2023, the total unrecognized cost relating to restricted share
awards was $
, respectively. As of June 30, 2024, the weighted-average period over
which the total compensation cost related to non-vested awards not yet recognized is expected to be
recognized is
12. Interest and Finance Costs
The amounts in the accompanying consolidated statements of comprehensive income/(loss) are
analyzed as follows:
For the six months ended June 30,
2024
2023
Interest expense, debt
$
$
Finance liabilities interest expense
Amortization of debt and finance liabilities issuance costs
Loan and other expenses
Interest expense and finance costs
$
$
13. Earnings/(loss) per Share
All common shares issued (including the restricted shares issued under the Company’s incentive plans)
are the Company’s common stock and have equal rights to vote and participate in dividends. The
calculation of basic earnings per share does not treat the non-vested shares (not considered participating
securities) as outstanding until the time/service-based vesting restriction has lapsed.
The dilutive effect
on unexercised warrants that are in-the-money, is computed using the treasury stock method which
assumes that the proceeds upon exercise of these warrants are used to purchase common shares at the
average market price for the period. Incremental shares are the number of shares assumed issued under
the treasury stock method weighted for the periods the non-vested shares were outstanding. During the
six months ended June 30, 2023, there were
of the diluted earnings per share calculation. For the six months ended June 30, 2024, incremental
shares were
t included in the calculation of the diluted earnings per share, as the Company incurred
losses and the effect of such shares would be anti-dilutive.
Net comprehensive income/(loss) attributable to common stockholders is adjusted by the dividends on
Series B Preferred Stock. Net comprehensive income/(loss) attributable to common stockholders is not
further adjusted by the unrealized loss on warrants as of June 30, 2024 to calculate the diluted earnings
per share because it would have an anti-dilutive effect.
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-19
For the six months ended June 30,
2024
2023
Net comprehensive income/(loss)
$
(706 )
$
Dividends on series B preferred shares
(2,884 )
(2,884 )
Net comprehensive income/(loss) attributable to common
stockholders
$
(3,590 )
$
Weighted average number of common shares, basic
Earnings/(loss) per share, basic
$
(0.03 )
$
Weighted average number of common shares, basic
Incremental shares
Weighted average number of common shares, diluted
Earnings/(loss) per share, diluted
$
(0.03 )
$
14. Financial Instruments and Fair Value Disclosures
Interest rate risk and concentration of credit risk
Financial instruments, which potentially subject the Company to significant concentrations of credit risk,
consist principally of cash and trade accounts receivable. The ability and willingness of each of the
Company’s counterparties to perform their obligations under a contract depend upon a number of factors
that are beyond the Company’s control and may include, among other things, general economic
conditions, the state of the capital markets, the condition of the shipping industry and charter hire
rates. The Company’s credit risk with financial institutions is limited as it has temporary cash investments,
consisting mostly of deposits, placed with various qualified financial institutions and performs periodic
evaluations of the relative credit standing of those financial institutions. The Company limits its credit risk
with accounts receivable by performing ongoing credit evaluations of its customers’ financial condition
and by receiving payments of hire in advance. The Company, generally, does not require collateral for its
accounts receivable and does not have any agreements to mitigate credit risk.
For the six months ended June 30, 2024 and 2023 charterers that individually accounted for
% or more
of the Company’s time charter revenues were as follows:
For the six months ended June 30,
Charterer
2024
2023
Cargill International SA
*
*Less than 10%
The Company is exposed to interest rate fluctuations associated with its variable rate borrowings. On
July 6, 2023, the company entered into an interest rate swap with DNB (Note 8) to manage part of such
exposure.
Fair value of assets and liabilities
The carrying values of financial assets reflected in the accompanying consolidated balance sheet
approximate their respective fair values due to the short-term nature of these financial instruments. The
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-20
fair value of long-term bank loans with variable interest rates approximates the recorded values,
generally due to their variable interest rates.
Fair value measurements disclosed
As of June 30, 2024, the Bond having a fixed interest rate and a carrying value of $
a fair value of $
FASB guidance for Fair Value Measurements.
Other Fair value measurements
December 31,
2023
Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs (Level 2)
Significant
Other
Observable
Inputs (Level 3)
Assets
Recurring fair value measurements
Investments in equity securities
$
$
$
$
Investments in related party
Interest rate swap, asset
Total recurring fair value measurements
$
$
$
$
Non-recurring fair value measurements
Equity method investments
$
$
$
Long-lived assets held for use
Total non-recurring fair value measurements
$
$
$
Liabilities
Recurring fair value measurements
Warrant liability
$
$
$
Interest rate swap, liability
Total recurring fair value measurements
$
$
$
June 30, 2024
Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs (Level 2)
Significant
Other
Observable
Inputs (Level 3)
Assets
Recurring fair value measurements
Investments in equity securities
Investments in related party
$
$
$
-
$
Interest rate swap, asset
Total recurring fair value measurements
$
$
$
$
Liabilities
Recurring fair value measurements
Warrant liability
$
$
$
-
Interest rate swap, liability
Total recurring fair value measurements
$
$
$
DIANA SHIPPING INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2024
(Expressed in thousands of U.S. Dollars – except share, per share data, unless otherwise stated)
F-21
15. Subsequent Events
a)
Exercise of warrants:
Since July 1, 2024 and until September 12, 2024, the Company issued
warrants.
b)
Bond Issue:
On July 2, 2024, the Company issued a new bond of $
2029 to refinance the existing $
bond was settled on July 8, 2024 and the Company incurred a loss of about $
, resulting
from the call premium.
c)
Series B Preferred Stock Dividends
: On July 15, 2024, the Company paid a quarterly dividend
on its series B preferred stock, amounting to $
, to its stockholders
of record as of July 12, 2024.
d)
Loan refinancing:
On July 25, 2024, the Company entered into a new loan agreement with
Nordea to refinance the
balance of $
. The new loan agreement will mature in
% over term SOFR.
e)
Delivery of Vessel:
On September 4, 2024, the vessel Houston was delivered to her new owners
(Note 6).