Second quarter expenses on the rise with expanding vessel base

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Star Bulk’s vessel-related expenses

For the second quarter of 2014, Star Bulk Carriers’ (SBLK) voyage expenses amounted to $5.3 million, compared to $1.9 million for the second quarter of 2013. This increase in expenses was due to the rise in voyage revenues and increased level of spot market activity during the second quarter of 2014 compared to the same period of 2013.

Star Bulk’s vessel operating expenses totaled $8.1 million, compared to $6.8 million in year ago quarter. This was due to a higher average number of vessels in the second quarter of 2014 compared to the second quarter of 2013. Average daily operating expenses per vessel for the second quarter of 2014 were $5,208 versus $5,664 during the second quarter of 2014, representing an 8% reduction.

Pro Forma SBLK Fleet

Other expenses on the rise

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Star Bulk’s (SBLK) depreciation expense increased to $5.1 million for the second quarter of 2014, compared to $3.9 million for the second quarter of 2013. This was due to the higher average number of vessels in the second quarter of 2014 compared to the second quarter of 2013. General and administrative expenses for the second quarter of 2014 and 2013 amounted to $6.4 million and $2.6 million, respectively.

In the second quarter of 2014, Star Bulk’s interest and finance costs decreased by $0.2 million, to $1.7 million, compared to $1.9 million for the second quarter of 2013.  The decrease was due to interest capitalized during the second quarter of 2014, amounting to $0.7 million, in relation to advances paid for the company’s 11 newbuilding vessels.

Star Bulk Carriers’ (SBLK) peers include Diana Shipping Inc. (DSX), Knightsbridge Shipping Ltd (VLCCF), Navios Maritime Holdings (NM), and Eagle Bulk Shipping Inc. (EGLE). The Guggenheim Shipping exchange-traded fund (or ETF) (SEA) helps investors keep track of the shipping industry dynamics and is a tracker of the shipping companies.

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