Star Bulk overview: Fleet and business strategy

By

Updated

Star Bulk Carriers Corporation: An overview

Star Bulk Carriers Corporation (SBLK) is a global shipping company providing worldwide seaborne transportation solutions in the dry bulk sector. Its vessels transport major bulks such as iron ore, coal, and grain, and minor bulks such as bauxite, fertilizers, and steel products. Star Bulk was incorporated in the Marshall Islands on December 13, 2006, and maintains executive offices in Athens, Greece.

Share Perf

Star Bulk’s fleet portfolio

Article continues below advertisement

Star Bulk Carriers Corporation (SBLK) has a fleet of 103 vessels in operation and under construction, with an aggregate capacity of 11.9 million dead weight tonnage (or DWT), consisting primarily of Capesize, Kamsarmax, Panamax, Ultramax, Supramax, and Handymax vessels with carrying capacities between 38,800 and 209,000 DWT.

With the addition of two vessels that Star Bulk (SBLK) will be acquiring from Heron Ventures Ltd. as well as the 34 vessels recently acquired, Star Bulk’s fleet currently includes 67 operating vessels and 36 under construction at shipyards in Japan and China. All of the newbuilding vessels are expected to be delivered in 2014, 2015, and early 2016.

Star Bulk has flexible business strategy

Star Bulk Carrier’s (SBLK) fleet portfolio includes almost all vessel classes, including Capesize, Post Panamax, Kamsarmax, Ultramax, and Supramax dry bulk carriers. The company emphasizes Capesize and Supramax, the vessels the company considers favorable in the demand versus supply fundamentals. Star Bulk’s fleet profile enables it to serve its customers in both major and minor bulk trades, and its vessels are able to trade worldwide in a multitude of trade routes carrying a wide range of cargo.

Like its peers, Diana Shipping Inc. (DSX), Knightsbridge Shipping Ltd. (VLCCF), Navios Maritime Holdings (NM), and Eagle Bulk Shipping Inc. (EGLE), Star Bulk uses a moderate, adaptive, and flexible strategy of employing a portion of the fleet on longer period charters securing stable cash flows and the rest of the fleet at spot employments or short period time charters. This strategy enables the company to benefit from the market’s upside potential or to seek additional charter coverage in the event of adverse market movements.

The Guggenheim Shipping exchange-traded fund (or ETF) (SEA) helps investors keep track of shipping industry dynamics and is a tracker of the shipping companies.

Advertisement

More From Market Realist