Euroseas Ltd. Stock

Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Conference Call on the Second Quarter 2026 Financial Results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. [Operator Instructions]

I must advise you that this conference is being recorded today. Please be reminded that the company announced their results with a press release that has been publicly distributed.

Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.

I kindly draw your attention to Slide #2 of the webcast presentation, which has the full forward-looking statement, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it.

And now I would like to pass the floor to Mr. Pittas. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. I'd like to apologize for the delay, but I was caught in another very important phone call. Sorry about that. Together with me is Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the 3 and 6-month period ended June 30, 2026.

Please turn to Slide 3 of the presentation for our quarterly financial highlights. For the second quarter of 2026, we reported total net revenues of $56.5 million and net income attributable to controlling shareholders of $33.2 million, or $4.74 per diluted share. Adjusted net income for the quarter was $32.9 million, or $4.70 per diluted share. Adjusted EBITDA for the period was $40.1 million.

Please refer to the press release for a reconciliation of adjusted net income and adjusted EBITDA to net income. Our CFO, Tasos Aslidis will go over our financial highlights in more detail later on in the presentation.

We are pleased to announce that our Board of Directors declared another quarterly dividend of $0.80 per share for the second quarter of 2026 as part of the company's common stock dividend plan. Based on current share price levels, the distribution reflects an annualized yield between 4.2% and 4.5% based on the recent range of share price.

Since the launch of our $20 million share repurchase program in May 2022, we have repurchased 480,000 shares in the open market through August 13th of 2026, representing approximately 6.8% of our outstanding shares for a total consideration of around $11.4 million.

We remain committed to executing the program in a disciplined and opportunistic manner, allocating capital prudently while enhancing long-term value for our shareholders.

Please turn to Slide 4 for an overview of our recent developments, covering key activities across vessel sale acquisitions, charter, and fleet operations. On the S&P front, as announced in mid-June, we entered into an agreement with Nantong CIMC Sinopacific Offshore & Engineering in China for the construction of 2 additional 1,800 TEU TLS containerships, sisters to the 2 we ordered in April 2026, with expected deliveries in December 2028 and March 2029. Total consideration for these vessels is approximately $64.5 million, which will be financed with a combination of debt aiming at 60% to 65%, and equity.

On May 4, we entered into a joint venture with NRP Project Finance for our first intermediate newbuilding, motor vessel Piraeus.

The vessel is scheduled for delivery in Q1 2028. Under the terms of the agreement, NRP investors will acquire a 49% stake for approximately $12.2 million, with the transaction assuming at least 60% debt financing. The first capital contribution has already been paid.

On the chartering side, we have secured multi-year charter extensions for motor vessel Pepi Star and motor vessel Stephania K. Both vessels are fixed for a minimum of 24 to maximum of 26 months at a daily rate of $25,500 per day, providing earnings visibility through at least the first quarter of 2028. We had no technical or commercial off-hire days this period.

Now, please turn to Slide 5. Our operating fleet consists of 21 vessels with a combined carrying capacity of approximately 61,000 TEU and an average age of 13 years. This includes 6 intermediate containerships with a carrying capacity of 25,500 TEU and an average age of 18 years, alongside 15 feeder containerships with a combined carrying capacity of 35,600 TEUs and an average age of 9 years.

We have 12 newbuilding vessels on order, 8 feeders and 4 intermediate containers, with delivery schedules Q3 2027 through Q1 2029. Upon completion of our newbuilding program, our fleet will expand to 33 vessels with a total carrying capacity of approximately 97,000 TEU, positioning us with one of the youngest feeder and intermediate containership fleets in the market.

Please turn to Slide 6 for a further update on our fleet employment and forward coverage. Our chartering coverage stands at 96% for 2026, 81% for 2027, and 47% for 2028 at highly attractive average daily rates of approximately $30,900 per day for 2026, $31,700 for 2027, and $32,300 for 2028. This insulates our earnings even if market rates soften when current charters expire.

Moving on to Slide 8, let me walk you through the market key developments that shaped the containership sector over the second quarter of 2028 -- 2026, sorry. Container shipping markets continued their upward trajectory through the whole of Q2 and Q3 to date, driven by robust mainlane demand and supply disruptions tied to the Middle East geopolitical tensions.

Charter rates reached the highest level since before the COVID-19 pandemic, while freight rates extended their momentum, posting multiple gains through July. On the asset side, secondhand vessel prices held steady during the second quarter compared with the first, despite ongoing geopolitical uncertainties.

The fundamentals remain solid, high supply of available tonnage and strong competition for prompt, charter fleet vessels continued to underpin valuations. Newbuilding prices also moved higher, up approximately 2% quarter-over-quarter, reflecting robust demand across the sector. Fleet utilization remains remarkably tight. Idle capacity, excluding vessels under repair, was just 200,000 TEU or 6% of the global fleet as of early July. This remains at historic lows and underscores the structural supply tightness we are seeing during this market cycle.

Finally, recycling activity has been notably subdued year-to-date, with only 10 vessels accounting for 25,000 TEU sent to scrap through July. This further reflects the high-value environment for tonnage and limited incentive to recycle. Meanwhile, the fleet grew by 2.6% year-to-date.

Please turn to Slide 9, which illustrates the development of 6-12 month time charter rates over the past decade. Across all vessel classes, from smaller feeders to the larger intermediate container segment, current charter rates remain notably above both their respective 10-year historical averages and median levels.

These smaller vessel classes play an essential role in maintaining network flexibility and supporting regional and interregional trade flows, a role that has become increasingly critical amidst geopolitical uncertainties and supply chain disruptions. With scarce available tonnage and underlying demand holding firm, the conditions supporting elevated time charter rates appear broadly intact for now.

Please turn to Slide 10, where we review the global macroeconomic backdrop and its implications for container shipping demand. According to the IMF July 2026 World Economic Outlook, global growth is projected at 3% in 2026, recovering to 3.4% in 2027, broadly unchanged cumulatively from April's forecast.

The outlook is elevated energy prices and geopolitical tensions, particularly the Iran conflict and Ukraine-Russia war, are driving inflation and interest rates higher. However, AI-driven investment is supporting growth in technology-integrated countries.

Meanwhile, global disinflation has stalled, with the inflation shock pushing the yield on the 10-year U.S. Treasury to approximately 4.7%. The U.S. economy has remained comparatively resilient at 2.3% growth. China is projected to grow 4.6% this year, supported by infrastructure investment and high-tech exports, but decline to just 4.1% growth in 2027, while ASEAN-5 region is projected to slow to 4.1% in 2026, before recovering to 4.3% growth in 2027.

On container trade, as measured in TEUs, volume is projected to moderate from 4.6% growth in 2025 to just 3.7% in 2026, reflecting tariff impacts and slower global growth overall due to the geopolitical disruptions.

Growth is expected to remain subdued at 3.4% in 2027, as the effects of the current disruption will take longer to dissipate. For container shipping specifically, containerized trade measured in TEU-miles is projected to grow by approximately 3.6% in 2026. However, we anticipate a normalization effect in 2027, with TEU-miles demand projected to decline by 4.8%, reflecting expectations of trade routes and sailing distances to return to historical patterns.

Turning on Slide 11, you can see the total fleet age profile and containership orderbook. Starting with the age profile in the upper left, the overall containership fleet remains relatively young, with a majority of vessels under 15 years of age and only about 15% of the fleet over 20 years old.

However, this aggregate view is totally different when examining the feeder and intermediate segments in isolation, which we will explore in greater detail over the next several slides.

Turning to vessel deliveries, the top right chart illustrates scheduled new deliveries as a percentage of the existing fleet. Deliveries are projected at approximately 5.5% for 2026, 9.4% for 2027, and 24.2% for 2028 onwards, although actual fleet growth is expected to be somewhat lower due to slippage and future demolition activity.

The bottom chart puts the current order book in historical context. At approximately 39.8% of the fleet as of August 2026, the order book has climbed to levels not seen in over 15 years, a development that warrants close attention as we think about the medium-term supply outlook for the sector.

Turning on Slide 12, we highlight the age profile and order book for the 1,000 to 3,000 TEU feeder segment. The supply here tells a markedly different story from the broader market. The age profile here is striking. Approximately 24% of the fleet is between 15 to 19 years, while 30% of the fleet is over 20 years old, meaning more than half of the feeder fleet is at or approaching scrapping age.

As environmental regulations tighten and compliance costs rise, a meaningful portion of these older vessels will likely exit the market over the coming years, depending on how challenging market conditions become. Against this aging backdrop, newbuilding activity in the sub- 3,000 TEU segment remains significantly restrained.

As of August 2026, the order book stands at 17.6%, substantially below the broader market, which is 39.8%, with scheduled deliveries of just 3.1% for 2026, 6.8% for 2027, and 8.1% for 2028 and beyond.

Let's move to Slide 13 to focus on the intermediate segment, the other core segment of our fleet. As of August 2026, the order book in this segment stands at approximately 28% of the existing fleet. While higher than the feeder segment, this remains modest relative to the large mainline vessel classes, where newbuilding activity has been considerably more active. What makes this segment particularly compelling from a supply perspective is the age profile.

About 36% of the fleet is between 15 to 19 years old, while 30% of vessels in this age range are over 20 years of age, meaning roughly 2/3 of the fleet is either at or approaching an age where retirement decisions become likely. Scheduled deliveries are projected at 3.8% for 2026, rising to approximately 7.8% in 2027, and 15.9% for 2028 and beyond.

However, when weighed against potential accelerated scrapping among the older tonnages, net fleet growth in this segment is expected to remain contained over the coming years. The interplay between a maturing fleet and the measured newbuilding pipeline continues to create a structurally supported environment for intermediate containership operators, despite an avoidable cascade effect, which of course will also take place.

Turning to Slide 14. This chart places the dynamics we've discussed in broader context across the entire containership sector. What's evident is the pronounced concentration of newbuilding activity in the larger vessel classes. Neo-panamax and Post-Panamax segments carry orderbooks of 40% to 87% of their existing fleet, reflecting the significant capacity directed towards major mainlane trades. These are the segments facing the most acute oversupply risk.

By contrast, feeders and intermediate segments exhibit significantly lower orderbook activity, ranging from 14% to 28%, depending on vessel size. This modest ordering activity is occurring against an aging fleet backdrop. The gap between the wave of newbuildings in larger vessel classes and limited fleet renewal in feeders and intermediate segments points to structurally more favorable supply outlook for the sizes in which Euroseas operates.

Now please turn to Slide 15, where we summarize our outlook. Markets have gained meaningful momentum through July, with rates at decade highs supported by strong East-West demand amid these disruptions. A limited 2026 supply is supporting the near-term balance, though we do expect some of the moderation towards the end of the year.

Looking ahead to 2027, the supply-demand picture shifts. Red Sea route normalization and the significant uptick in vessel deliveries could pressure the market. That said, capacity management, accelerated scrapping, and slower steaming could help absorb incremental supply. Geopolitical uncertainty also complicates timing of any normalization.

Finally, the impact of tariffs has been more muted than feared. Though U.S. trade policy remains a variable we are continuing to monitor closely.

Turning to Slide 16, the charts illustrate the strength of the current cycle. One-year time charter rates for 2,500 TEU containerships stand at $38,250 per day, substantially above the 10-year historical average of $24,000 and median of $16,000 per day. This is obviously reflected in asset values as well.

The right chart shows newbuilding vessels are now priced at $45.5 million, versus a 10-year median and average of approximately $36.7 million, while the 10-year-old vessel is valued at $41 million compared to the historical average of $22.5 million and a median of $18.75 million. These elevated secondhand valuations, particularly without attached employment, present a less competitive risk reward profile at this stage of the cycle.

Newbuilding, by contrast, offers greater pricing flexibility and cost predictability. This conviction has driven our decision to expand our order book expansion to 12 vessels.

Building on the 9 vessels we completed in early 2025. This strategic position, combined with our strong balance sheet and substantial liquidity, puts us in an enviable position, well-capitalized to pursue accretive opportunities when they arise, while our fleet benefits from lower operating costs and environmental advantages that differentiates us competitively.

I will now turn the call over to Tasos, who will go over our financial results for the second quarter and first half of 2026 in more detail.

Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next 5 slides, I will give you the usual overview of our financial highlights for the second quarter and first half of 2026 and compare those results to the same period of last year.

For that, let's turn to Slide 18. For the second quarter of 2026, the company reported total net revenues of $56.5 million, representing a 1.3% decrease over total net revenues of $57.2 million during the second quarter of 2025. These were the result of the lower average number of vessels we owned and operated this past quarter in 2026, compared to the same second quarter of 2025, and it was partly offset by the increase in the time charter rates that we earned on average in the respective periods.

The company reported net income of $32.6 million and net income attributable to controlling shareholders of $33.2 million for the second quarter of 2026 as compared to a net income attributable to controlling shareholders of $29.9 million for the same period for the second quarter of 2025.

The net loss attributable to non-controlling shareholders of $0.6 million in the second quarter of 2026 represents the 49% ownership of the entities owning our newbuilding M/V Thrylos, which are represented by NRP investors.

Interest and other financing costs for the second quarter of 2026 amounted to $2.7 million, compared to $4 million for the second quarter of 2025. This decrease is due to the decreased amount of debt and the decreased interest rate of our loans in the current period compared to the same period last year.

If we account for interest income, the respective amount become $1.3 million and $3.7 million for the second quarter of 2026 and 2025 respectively, and these are the figures shown in the net interest line in the table on the slide.

As part of our liquidity management strategy, we entered into investments in equity and debt securities in the first quarter of 2026. For the 3 months ended June 30, 2026, the company recognized a $0.29 million unrealized mark-to-market gain on its investments in equity securities, resulting from an increase in the fair value of the investments.

At the same time, we acquired debt securities with an initial cost of $20 million, classified as available for sale under GAAP, for which the fair value decreased between quarters, resulting in an unrealized loss of approximately $0.24 million during the second quarter of 2026. We did not have such investments in the second quarter of last year.

It is worth noting that these investments are intended to be held to maturity, and as such, the loss is purely accounting in nature and there's no cash impact. In fact, these holdings continue to generate regular dividend income, which partially offsets any short-term valuation fluctuations.

Adjusted EBITDA for the second quarter of 2026 was $40.1 million compared to $39.3 million during the same period of last year. Basic and diluted earnings per share attributable to controlling shareholders for the second quarter of the year were $4.77 and $4.74, basic and diluted, calculated on approximately 7 million of weighted average number of shares outstanding, compared to basic and diluted earnings attributable to controlling shareholders of $4.32 and $4.29 per share, basic and diluted respectively, for the second quarter of last year.

Excluding the effect on the net income attributable to controlling shareholders for this quarter, for the unrealized gain on investments in equity securities, the adjusted earnings attributable to controlling shareholders for the second quarter of 2026 would have been $4.73 basic and $4.70 diluted, compared to adjusted earnings attributable again to controlling shareholders for $4.23 basic and $4.20 diluted for the same period of last year.

Let's now look at the numbers on the same slide, and look at the numbers corresponding to the 6-month period ended June 30th, and compare them to the same period of last year. For the first half of 2026, the company reported total net revenues of $112.3 million, representing a 1.1% decrease over total net revenues of $113.6 million during the first half of last year. The same reasons that are used to explain the quarterly decline apply here.

The company reported a net income for the period of $65.1 million, a net income attributable to controlling shareholders of $65.7 million, as compared to net income and net income attributable to controlling shareholders of $66.8 million for the same period for the first half of 2025.

Total interest and other financing costs for the first half of 2026 amounted to $5.7 million. Total interest for financing cost for the first half of 2025 amounted to $7.9 million. The decrease, again, due to the lower levels of debt on average and the lower interest rate paid.

Accounting for interest income for the respective amount become $2.44 million and [ $3.37 ] million for the first half of 2026 and 2025, and these are the 2 figures shown on the slide, and they include the net interest that we recognize.

Adjusted EBITDA for the first half of 2026 was $81 million compared to $76.4 million for the same period of last year. Basic and diluted earnings per share attributable to controlling shareholders for the first half of 2026 were $9.44 basic and $9.39 diluted, compared to $9.63 basic and $9.60 diluted for the same period of 2025.

The adjusted earnings per share attributable to controlling shareholders for the 6 months ended June 30th, 2026, would have been $9.45 basic and $9.40 diluted, compared again to adjusted earnings for the same period of last year of $7.99 basic and $7.97 diluted.

Let's now turn to Slide 19 to review our fleet performance. We'll start our review by looking at the fleet utilization rate for the second quarters of 2026 and 2025. As usual, our fleet utilization rate is broken down into commercial and operational components.

During the second quarter of 2026 and 2025, commercial utilization was for both periods 100%, while operational utilization was 99.9% as expected. On average, 21 vessels were owned and operated in the second quarter of 2026, earning an average Time Charter Equivalent rate of $30,306 per day, compared to 22 vessels for the same period of last year, earning an average $29,420 per day.

Our total daily operating expenses include management fees, G&A expenses, but excluding dry docking costs, were $8,036 per vessel per day in the second quarter of this year, compared to [ $7,694 ] per vessel per day in the second quarter of 2025.

If we move further down on this table, we can see as always, the daily cash flow break-even levels, which takes into account, in addition to the operating expenses, the dry docking expenses, interest expenses, and loan repayments without accounting for balloon repayments, and all of those are expressed on a per vessel per day basis. For the second quarter of 2026, our daily cash flow break-even rate was $12,233 per vessel per day as compared to $13,261 for the same period, the second quarter of 2025.

At the very bottom of this table, you can see the dividend we paid, expressed in dollars per vessel per day. In the second quarter of 2026, this amounted to $2,916, compared to $2,275 in the same period of last year. The increase reflecting the increase in the actual amount of dividend paid and the reduction in the number of vessels.

Let's now look at the right-hand side of this table and review the same metrics for the first half period. During the first half period for 2026, both operational and commercial utilization rates were at 100%, while operational utilization rate for the corresponding period of 2025 was 99.6%, and commercial was again 100%. On average, for the 6-month period, we owned and operated 21 vessels, earning an average Time Charter Equivalent rate of $30,330 per day, compared to 22.83 vessels we operated in the same period of last year, earning an average of $28,468 per day.

Operating expenses, again, including management fees and G&A expenses, but not dry docking costs, averaged $7,963 per vessel per day this year compared to $7,454 for the same period for the first half of 2025.

The break-even levels, again, at the bottom of this table, were $12,290 for the 6 months of this year compared to $13,163 for 2025. And the common dividend expressed in dollars per day per vessel in the first half of this year amounted $2,839, up 29% from $2,196 in the first quarter of last year.

Let's now move to the next slide, which has less numbers and aims to provide a better perspective of the depth of our contract cover that I previously discussed in an earlier slide. This table presents the development of our fleet ownership days over the period of the next 3 years because we have newbuildings coming in, and an estimated breakdown of how many days are available for hire and how many days are already contracted.

It incorporates assumptions about delivery times for the vessels under construction, scrapping times for older vessels, estimated dry docking duration and timing, utilization rate assumptions going forward, and estimates for contracted days and average contracted rate per day. Please note that the data presented in this table represents our internal estimates provided only for illustrative purposes to be used for modeling future Time Charter Equivalent revenues, and of course, actual results might differ.

Nevertheless, we believe this provides a useful visibility into our forward revenue and earnings profile. Although our contracted coverage has been discussed earlier, just for reference, I will mention that the contract coverage currently stands at approximately 96% for the remainder of 2026, 81% for 2027, and almost 47% for 2028. While our average contracted rate for those periods are $30,858 for 2026, $31,658 for 2027, and $32,310 for 2028.

Moving on to Slide 21 to review our debt profile. As of June 30, our total outstanding bank debt stood at about $208 million, with an average interest rate margin of around 2%. We assume here a 3-month SOFR rate of 3.76%. Our total debt cost amounts to about a little more than 5.75%, which is well within the prevailing rate for our peers.

Turning to our debt amortization profile on the top left of this slide, we can see that in 2026, total repayments amounted to $19.6 million, consisting of approximately $9.06 million of scheduled loan repayments and $10.49 million of already paid loan obligations. In 2027, total debt service increases to approximately $36.85 million, inclusive of a balloon payment of $20 million. In 2028, repayments of loans are lower, down to $12 million, and no balloon payments due. Looking farther ahead, 2029 includes total repayments of $40.6 million, which includes $10.6 million of scheduled loan repayments and a $30 million balloon. 2030 includes total repayments of $33.8 million, split between $7.4 million of scheduled repayments and $26.4 million of balloon.

Historically, we have been able to finance balloon payments on favorable terms, and we expect to maintain that capacity of doing it in the future if we choose to do so. These figures reflect our current debt profile and do not include financing that we will assume to finance our newbuilding program.

At the bottom of this table, we can show our vessel month forward revenue rate, which stands at $13,382 per vessel per day, and you can see the components is broken down.

Let me conclude this presentation by turning to Slide 22 for a quick review of selected highlights from our balance sheet. As usual, we present our balance sheet in a simplified way, in the form of 2 bars. On the left bar, we show the asset side. We have the current assets of cash and other current assets of approximately $226 million. We have made approximately $74 million of advances against our newbuilding program, and the book value of our fleet stands at about $453 million, bringing the total assets in our balance sheet to $753 million.

Moving to the right bar, the liabilities, there we mentioned we have a bank debt of $208 million and additional liabilities of about $21 million, and a small amount of minority investment, resulting in about $523 million of book shareholders' equity. However, the true shareholders' equity should be adjusted for the market value of our fleet, which is significantly higher than its book value.

We estimate that our current fleet is valued at approximately $660 million, which translates to a net asset value for the company of more than $725 million, or about $103 per share. The current price levels, which although have increased, still trade below to our net asset value, and this valuation gap presents an opportunity for both our shareholders, but also to investors that want to consider investing in Euroseas.

With that, I'll turn the floor back to Aristides to moderate the question and answer period.

Thank you, Tasos. Let me now open up the floor for any questions you may have.

[Operator Instructions] Our first question comes from the line of Mark Reichman with NOBLE Capital Markets.

Yes. So advances for vessels under construction. So those were about $74 million at June 30. And I was just wondering if you could just maybe kind of walk us through how much additional equity capital will need to be contributed to the newbuild program between now and first quarter 2029. And just maybe the breakout between…

Can just spoke up?

Can you hear me?

Yes. I can hear you. So I think on the top of my head, the overall cost of our newbuilding program is around $560 million, and we plan to finance it about 60% debt. So roughly speaking, the equity requirements altogether would be around $230 million, of which $74 million have been made.

Okay. That's helpful. And then the fleet table on Page 7, I think what's interesting is, clearly, the older vessels remain on attractive charters while you've got this much younger fleet coming. But because 6 of those vessels were built between 2001 and 2009 and have charters that are expiring over the next several years, what are your thoughts on whether you continue to operate those as the newbuilds arrive? Do you plan to sell some?

And then -- and I guess just related to that question, on Page 20, you have 20.8 vessels for 2026, which would imply 21 vessels through the first 3 quarters and maybe 20 vessels in the fourth quarter. So maybe you could just kind of square that up as part of the discussion.

Yes. We are not thinking of selling any vessels currently. The market is so strong that it makes sense operating the elder vessels as well. So we are fixing these ships for 2 years, at least, charters. So this will become an issue maybe 2 years down the line if the market has dropped significantly. But for now, I think that the earnings that these older vessels generate are worth keeping them.

And in Slide 20, I think we have indicative figures, the 2 elder vessels that you, I think, essentially pinpointed, we are negotiating to recharter. At the end of 2027, we start getting the newbuildings in. So there might be some assumptions about some disposals then, but one can make their own assumptions about how many vessels we will be operating.

On Page 20 of the presentation, I think you have 20.8 and you've got 21 vessels in your portfolio. So what accounts for the 20.8? Is that the one single dry docking?

I think we have 1 vessel that we are modeling as potential to be sold, one of the elder ones. But we are in the process of negotiating an extension to its charter at this point.

I see. We should assume 21 week to the…

Yeah. The model shows that 1 vessel, namely EM Corfu, provisionally has a potential for.

Okay. So we could -- you could assume potentially 21 vessels for the remainder of the year, but you could sell 1 maybe by the fourth quarter, in which case that would get to the $20.7 mark?

That is a very slight possibility. That was a thought in our model a few months ago, but now we are seeing significant interest in that vessel, so it will probably be extended with the charter for at least 2 years. So that postpones the selling time by a couple of years.

I see. Okay. And then just last question. So you had a little over $164 million in restricted and unrestricted cash, I think about $208 million of debt. So how do you kind of think about the capital allocation in terms of putting that marginal dollar to work in newbuilds, acquisitions, debt repayments, dividends and of course, your share repurchases, which you have highlighted?

Yes. This is balancing act that we need to do because we do have this $160 million as you say. Of course, we have another $160 million to pay for our newbuilds during the next couple of years. However, we will be making a similar amount, I think, in the next couple of years. So there will be enough money to look into further investments perhaps growing the dividend, perhaps share repurchase. Everything is on the table and we discuss it in our quarterly Board of Directors meetings in order to best utilize the capital.

Our next question comes from the line of Tate Sullivan with Maxim Group.

And you provided a newbuild commitment number earlier. And with the number of ships under construction and your experience in the last 2, 3 years with building new ships, is it reasonable to forecast any delays in delivery schedules at this point given the busier shipyards? Or it seems quite consistent, but would love to appreciate your comments, please.

Yes. At this point, we don't foresee any delay in the construction of the ships. Of course, we will only know closer to the delivery times, but shipyards in general seem to be more or less making their delivery schedules.

Yes. It's been impressive and your streak has been as well. And then your contracting strategy for the newbuilds, would you say consistent to your prior newbuilds contracts in terms of fixing multiyear contracts? Is there any change in the discussions to change contract structures in the containership industry to have floors and the potential of upside to those rates? Any you comment on that, please?

Yes, not really. The idea is to fix longer-term charters if we can. But it's a bit too early for us to do that right now. If we were to do it right now, we would have to accept the lower rates than what we think we can get if we wait a little longer. We fixed the 4 intermediate ships, as you know, but the remaining 8 ships, we're waiting to see if we can get a good rate.

We have not seen any change in the contract structure, like a floor and a cap. Whatever discussions we have are the traditional sort of flat rate, possibly with some early expiring options to do 3 or 4 years or 2 or 3 years.

[Operator Instructions] Our next question comes from the line of Poe Fratt with Alliance Global Partners.

I was wondering if you could help me reconcile the dry docking activity that's on Page 6 with the information in your 20-F. The 20-F is showing 6 dry docks or intermediate and special surveys over the second half of the year. And the slide on Page 6 only shows 2. So I was just -- is there more dry docking activity ahead of us? And certainly, in '27, there will be, but I was just looking about -- asking about the rest of 2026.

In the rest of 2026, we have 3 dry dockings to be done. The remaining 3 perhaps that you see might be in water, the dry docks, which is a small delay of 1 day and a minimal cost. We have 3 big dry dockings within this quarter and the next one on 3 of our elder vessels, the Evridiki, the EM Corfu, and the Jonathan P.

Okay. That's helpful. And I apologize if I missed this when you reported your first quarter numbers. But can you just talk about the equity investments that you've made and the nature of those equity investments and sort of the risk profile potentially of those equity investments?

I think, yes. These are bond funds just to get a little bit of a higher return than just deposits. These are bond funds investing in investment-grade bonds. So it's a very safe investment and very liquid.

And then we have 1 additional investment in a capital protected structured fund, which again is capital protected and depending on various parameters, might give us a little bit of a higher return. So it's really actually cash management, but trying to get a little bit more than just the pure deposit rate.

Okay. That's helpful. I'm sorry, Tasos, I didn't understand.

No, it can be easily liquidated if we need the funds, which we will not need because we have $160 million outside this $39 million, $38 million that is involved in.

Okay. But just to clarify, you're not investing in individual companies and with a higher risk profile than a bond fund?

Yes. No, it is not that.

Our next question comes from the line of Climent Molins with Value Investors Edge.

I wanted to follow-up on Mark's question on your older vessels. We've seen some forward fixtures in recent months, but mostly on modern tonnage. Could you talk a bit about the dynamics of forward fixing on older vessels? Is that something widely available? And if that were the case, how does the implied discount compared to more modern vessels?

There is actually a lack of vessels today. So one can fix even the vessels that open up within the next 3 to 6 months quite easily at very decent rates. Very small discounts to the more modern ones, mainly reflecting the fact that they consume less fuel.

But overall, the market is very tight, and that is why we expect we will be able to fix our 3 ships that open up within this year, later towards the end of the year. But I think we will be able to fix them within the next month or so.

Okay. That's helpful. And final question for me. The order book for smaller vessels is significantly lower than for the larger sizes. Have you seen any cascading from larger vessels cannibalizing routes that are usually serviced by smaller vessels? And looking ahead, do you think this is a risk or is unlikely to have a material impact?

Well, the markets are totally unstable due to the geopolitical developments. So that makes it difficult for liner companies to adjust their schedules significantly. So the answer is no. Currently, the lines are in a difficult position trying to carry the cargo they have to carry. It's difficult for them to optimize routes.

When things normalize, if things normalize at some point, they have to at some point, I do not know if it's in 3 months or in a year or 2. But when things normalize, that's when the lines start to try to optimize, and optimization, of course, leads to increasing the size of the ships that serve various ports. So yes, we will see the cascading effect as things normalize, but to now, we don't really see that.

And also, if you look at Slide 14 and you see the size groups, the elder fleet percentage and order book, between the larger sizes where there is a huge order book and allows, there are some other sizes that also are relatively balanced.

So although what our activities could happen, will happen, we were farther away from the larger ships that will cascade down. They have to push other sizes down, which are also balanced. It is a little bit less of an issue than if we owned 8,000 TEU vessels.

[Operator Instructions] It appears we have no further questions at this time. Mr. Pittas, I'd like to turn the floor back over to you for closing comments.

Thank you all for standing by and listening to our presentation. And we'll be back to you in 3 months' time. Thank you.

Thanks, everybody.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.

Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Conference Call on the First Quarter 2026 Financial Results. We have with us today Mr. Aristides Pittas, Chairman and Chief Executive Officer; Mr. Tasos Aslidis, Chief Financial Officer of the company. [Operator Instructions] I must advise that this conference is being recorded today.

Please be reminded that the company announced their results with a press release that has been publicly distributed. Before passing the floor over to Mr. Pittas, I would like to remind everybody that in today's presentation and the conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.

I kindly draw your attention to Slide #2 of the webcast presentation, which has the full forward-looking statement, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it.

I would now like to pass the floor over to Mr. Pittas. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me is Tasos Aslidis, our CFO, who will discuss in detail our financial results later.

Please turn to Slide 3 of the presentation for our financial highlights. For the first quarter of 2026, we reported total net revenues of $55.84 million and net income of $32.52 million or $4.65 per diluted share. Adjusted net income for the quarter was $32.87 million or $4.70 per diluted share. Adjusted EBITDA was close to $41 million. Please refer to our press release for the reconciliation of adjusted net income and adjusted EBITDA to net income. Tasos will walk you through the results, as I said earlier, in more detail.

Consistent with our commitment to enhance shareholder returns, our Board of Directors approved a quarterly dividend of $0.80 per share for the first quarter of 2026, representing a 6.7% increase from the $0.75 per share that we paid for the fourth quarter of 2025. The dividend will be payable on or about June 16 to shareholders of record on June 9. Based on our current share price, this translates to an annualized dividend yield of close to 5%. On the buyback front, since the launch of our $20 million share repurchase program in May 2022, we have repurchased 480,500 shares in the open market, representing about 6.8% of our outstanding shares for an aggregate consideration of approximately $11.4 million. The program was renewed for fourth consecutive year in May 2026, and we intend to continue executing it in a disciplined and opportunistic manner, deploying capital prudently to support long-term shareholder value.

Finally, we recently entered into a joint venture with NRP Project Finance and related investors for the ownership of our third intermediate containership on [ order ] Motor/Vessel Thrylos. The vessel is scheduled to be delivered in Q1 2028 and will be financed with at least 60% debt. Under the terms of the agreement, NRP investors will acquire a 49% stake for approximately $12.2 million, including the transaction cost.

Please turn to Slide 4 for an overview of our recent developments, covering key activities across vessel sale acquisitions, chartering and fleet operations. On the S&P front, we continue to expand our newbuilding program with 2 strategically aligned orders that further strengthen our fleet profile and long-term growth trajectory. First, as already announced, we signed an agreement with Huanghai Shipbuilding Company in China for the construction of 2 additional methanol-ready 2,800 TEU container ships with scheduled deliveries in November '28 and February '29. These are sister ships to the vessels already ordered in March 2026, bringing the series to 4 units in total. The aggregate consideration is approximately $93 million and will be financed through equity and debt. We are targeting approximately 60% to 65% leverage.

Second, we entered into agreement with Nantong CIMC Sinopacific Offshore & Engineering in China for the construction of two 1,800 TEU reefer container ships with expected deliveries in June 2028 and September 2028. Total consideration for these vessels is approximately $64.5 million and will be financed on a similarly structured basis with equity and debt.

On the chartering side, we secured multiyear employment for 2 of our vessels, further strengthening our revenue stability. Motor Vessel EM Kea was fixed for 36 to 38 months at a rate of $30,000 per day and Motor/Vessel EM Spetses for 22 to 24 months at $21,500 per day. I am pleased to report that we had no idle or commercial off-hire days this period.

Now please turn to Slide 5. Our operating fleet currently consists of 21 vessels with a combined carrying capacity of approximately 61,000 TEUs and an average age of about 13 years. This comprises the 6 intermediate containerships with a carrying capacity of approximately 25,000 TEUs and an average age of 18 years, alongside 15 feeder containerships with a combined carrying capacity of 35,000 TEUs and an average age just below 10 years.

In addition, we have the 10 newbuilding vessels on order ranging in size from 1,780 TEU to 4,480 TEU with expected deliveries between the third quarter of 2027 and the first quarter of 2029. Upon full delivery of our newbuilding program, our fleet will grow to 31 vessels with a total carrying capacity of approximately 94,000 TEUs.

Please turn to Slide 6 for a further update of our fleet employment and forward coverage, which continues to underpin strong revenue visibility across our operating fleet. For 2026, approximately 96% of available voyage days have been secured at an average daily rate of approximately $30,150. Looking ahead to 2027, we have already covered 86% of our available voyage days at an average rate of approximately $31,000 per day. For 2028, approximately half of our available voyage days are covered at an average rate of approximately $31,500 per day. This strong forward coverage is the result of our disciplined cycle-aware chartering strategy, which is designed to effectively balance market exposure with earnings stability. Importantly, it provides meaningful cash flow visibility and supports our ability to sustain profitability across different market conditions, including periods of market softness or sudden market correction.

Moving on to Slide 8. Let's walk through the key market developments that shaped the containership sector over the first quarter of 2028 (sic) [ 2026 ]. One-year time charter rates held firm at elevated levels, supported in the near term by a substantial portion of the fleet being fixed forward as liner operators continued to lock in tonnage to navigate lingering supply chain disruptions and network imbalances.

On the freight side, conditions were more volatile with an overall Shanghai Containerized Freight Index rebounding by approximately 75% of its late-September trough, which has represented a near 2-year low and has since been closing in on early June peak, though it still remains about 13% below that.

Turning to asset values. Secondhand asset prices edged higher by about 2% quarter-over-quarter, remaining at elevated levels despite the backdrop of persistent geopolitical uncertainties. The underlying drivers remain intact, structurally constrained supply of available vessels and intense competition for prompt charter-free tonnage continue to provide a strong floor for asset prices.

On the newbuilding side, the price index was essentially flat relative to the prior quarter, with robust appetite across both feeder and larger vessel classes helping to sustain pricing even as absolute cost levels remain quite elevated by historical standards. Fleet utilization continues to reflect a tight market. Idle fleet capacity, excluding vessels under repair, stood at just 240,000 TEU or 0.7% of the global fleet as of early May. This figure remains close to historic lows and is a clear indicator of the supply tightness that has characterized this market cycle.

Finally, recycling activity has remained notably muted thus far in 2026 with only 5 vessels totaling approximately 9,000 TEU sent to scrap year-to-date. Scrap prices in Bangladesh have softened to approximately $470 per lightweight ton as of May 15, 2026. Meanwhile, the global container fleet has expanded by approximately 1.3% year-to-date.

Please turn to Slide 9, which depicts the development of 6 to 12 months time charter rates over the past 10 years. Across the board, from the smaller feeders through to the bigger intermediate container segment, current charter rates remain notably above both their respective 10-year historical averages and median levels. These smaller vessel classes remain essential in maintaining network flexibility and supporting regional and intra-regional trade flows, a role that has only grown in importance amid the ongoing geopolitical uncertainties and supply chain alignment. With scarce availability tonnage and underlying demand holding firm, the conditions that have sustained elevated time charter rates appear to remain broadly intact for now.

Let's go to Slide 10. This slide sets the macroeconomic backdrop, drawing on the IMF April 2026 World Economic Outlook update as well as Clarksons latest trade estimates for containers. The IMF projects global growth to moderate to 3.1% in 2026 from 3.3% previously and 3.2% in 2027 with more risks on the downside. Key risks include the broadening of the Middle East conflict, the disruptive effects of shifting trade policy and lingering inflationary pressures tied to commodity supply stocks. Global headline inflation is projected to rise modestly in 2026 before resuming to gradual decline in 2027, with the impact likely to be most pronounced in emerging markets and developing economies.

In the United States, the 2026 growth forecast was revised slightly lower to 2.3%, though the 2027 outlook was revised slightly upwards to 2.1%, reflecting continued underlying resilience despite macroeconomic imbalances. Monetary policy remains key as the Federal Reserve is in a holding pattern, while rate cuts have been put on pause, pending further evidence of easing inflation. The effective Fed funds rate stands at approximately 3.64% within a target range of 3.5% and 3.75%, and expectations that the Federal Reserve could begin cutting rates again from late 2026. Against this backdrop, a gradual depreciation of the U.S. dollar is anticipated as monetary policy begins to ease.

In Asia, the ASEAN-5 region is projected to grow at around 4.1% in 2026 and 4.4% in 2027, though external headwinds, including energy market volatility, geopolitical trade fragmentation and fading export momentum are expected to weigh on near-term performance. Meanwhile, China's growth trajectory is projected to remain relatively resilient with GDP growth of 4.4% in 2026 and 4% in 2027, supported in part by the country's technological and industrial competitiveness. That said, structural economic imbalances persist and policy remains firmly oriented towards high-quality growth with priorities on energy security, domestic demand consumption and productivity gains through innovation.

On trade, Clarksons estimates containerized trade growth measured in TEU miles of approximately 1.1% in 2026 before contracting sharply to a negative 6.6% in 2027. This significant reversal assumes a complete normalization of global trade flows. Therefore, ongoing geopolitical uncertainty, shifting trade policies and potential unwinding of supply chain complexity are the main factors that will weigh on trade growth over the medium term.

Turning on to Slide 11. We provide an overview of the total fleet age profile and containership order book. Starting with the age profile in the upper left, the overall containership fleet remains relatively young with the majority of vessels under 15 years of age and only about 14% of the fleet over 20 years old. However, this aggregate view is totally different when examining the feeder and intermediate segments in isolation, which we will explore in greater detail over the next several slides.

Turning to vessel deliveries. The top right chart illustrates scheduled new deliveries as a percentage of the existing fleet. Deliveries are projected at approximately 5.2% for 2026, 8.9% for 2027 and 20.2% for 2028 onwards, although actual fleet growth is expected to be somewhat lower due to slippage and future demolition activity.

The bottom chart puts the current order book in historical context. At approximately 37.7% of the fleet as of May 2026, the order book has climbed to levels not seen in over 15 years, a development that warrants close attention as we think about the medium-term supply outlook for the sector.

Turning on to Slide 12. We zoom in on the 1,000 to 3,000 TEU range, the feeder segment that forms the core of our fleet. The supply picture here tells us a completely different story from the broader market. The age profile here is striking. Approximately 28% of the fleet is over 20 years old with a further 25% in the 15 to 19 years age bracket, meaning that more than half of the feeder fleet is approaching scrap age.

As environmental regulations continue to tighten and compliance costs increase, a meaningful portion of this older tonnage is likely to exit the fleet over the coming years. Against this aging fleet, new building activity in the sub-3,000 TEU segment remains decidedly restrained. As of May 2026, the order book stands at 14% of the fleet, a fraction of the 37.7% we saw in the previous slide, and scheduled deliveries are projected at 2.6% for 2026, 5.5% for 2027 and 5.8% for 2028 and beyond.

Let's move to Slide 13 now to focus on the intermediate segment, the other core segment of our fleet. As of May 2026, the order book in this segment stands at approximately 21% of the existing fleet. While that figure is higher than what we saw in the feeder segment, it remains comparatively modest relative to the larger mainline vessel classes where newbuilding activity has been considerably more pronounced. What makes this segment particularly compelling from a supply perspective is the age profile. Approximately 29% of vessels in this size range are over 20 years of age with a further 38% falling between the 15- to 19-year bracket. This means roughly 2/3 of the fleet is either at or approaching an age where retirement decisions become likely, especially as environmental compliance requirements become increasingly stringent and costly, like we've mentioned numerous times.

Scheduled deliveries are projected at 3.7% of the fleet in 2026, rising to approximately 5.6% in 2027 and around 9.7% for 2028 and beyond. However, when weighed against the potential for accelerated scrapping among the older segments, net fleet growth in this segment is expected to remain contained over the coming years. The interplay between a maturing fleet and a measured newbuilding pipeline continues to underpin a structurally supportive environment for intermediate containership operators.

Moving on to Slide 14. This chart places the dynamics we presented in a broader context across the entire containership sector. What becomes particularly evident is the pronounced concentration of newbuilding activity in the larger vessel classes. Neo-Panamax and Post-Panamax segments currently carry order books ranging from approximately 39% to 89% of their existing fleet, reflecting the significant capacity additions targeted towards major mainline trades. These are the vessel classes where oversupply concerns are most acute.

By contrast, the feeder and intermediate segments exhibit significantly lower order book activity, ranging from approximately 12% to 21% of the existing fleet, depending on vessel size, as said before. The modest ordering activity is occurring against a backdrop of fleet that is aging rapidly. This widening gap between the wave of newbuilding activity in larger vessel classes and comparatively limited fleet renewal in the feeder and intermediate segments points to a structurally more favorable supply outlook for the sizes in which Euroseas operates. With a significant portion of the existing fleet approaching replacement age, net fleet growth in these segments is likely to remain constrained. This dynamic underpins our conviction that Euroseas fleet is positioned in segments where the supply outlook remains genuinely supportive with hopefully limited risk of oversupply on the horizon.

Now please turn to Slide 15. This slide brings together the key themes shaping the container sector outlook. Near-term sentiment has been bolstered by escalating Middle East tensions, which have driven time charter rates to a new post-COVID highs and pushed freight rates higher as liner companies scramble to secure tonnage amid ongoing supply chain disruptions. Container shipping sentiment was strong throughout the quarter and even strengthened in April.

Overall, for 2026, fleet growth is expected to be among the lowest in recent years, supporting a more balanced supply-demand environment. The slower-than-anticipated normalization of Red Sea routing continues to provide additional near-term buffer. The 2027 picture, though, is more challenging. A historically large wave of newbuild deliveries, particularly during the second half of the year is set to test the market.

Capacity management and accelerated scrapping may help offset some of the pressure, but the potential for a more difficult market environment is real. The geopolitical and macroeconomic variables in play, however, make forecasting particularly difficult. At the same time, concerns around tariffs appear to have moderated with the impact on container shipping to date proving more limited than initially anticipated.

Finally, on energy transition, while there is a clear industry shift towards alternative fuels and lower emission technologies, the pace of adoption is likely to be slower than anticipated given the U.S. stance, technical and economic hurdles and delays in finalizing the IMO's net-zero framework.

Let's turn now to my last slide, Slide 16. The left chart shows the cycle of the 1-year time charter rate for 2,500 TEU containerships over the past decade. As of May 15, the 1-year time charter rate stands at $37,000 per day, comfortably above both the 10-year historical average of around $23,500 and the median of close to $15,000 per day. This firm rate environment is mirrored in asset values as well. The right chart shows newbuilding vessels are now valued at approximately $44 million, meaningfully above the 10-year median and average of $36 million.

Secondhand values are even more striking in relative terms. The 10-year-old vessel is currently valued at about $40 million compared to a 10-year historical average of around $22 million and a median of $15 million. Given the current elevated secondhand asset values, we believe acquiring vessels, especially without attached employment, offers a less compelling risk reward profile at this stage of the cycle.

Newbuilding, by contrast, presents a more attractive avenue for fleet investment with pricing that's comparatively less volatile and that allows us to lock in costs with greater predictability. With that conviction, we have expanded our newbuilding program by adding 4 new shipbuilding contracts, bringing our total order book to 10 vessels, as already mentioned. This builds directly on the 9 vessel newbuilding programs we successfully completed in early 2025 and reflects our continued confidence in the long-term outlook for the feeder and intermediate segments.

Upon delivery of all 10 vessels, Euroseas will operate one of the youngest and most modern feeder and intermediate containership fleets among our peer group. A competitive advantage we expect to translate into stronger commercial positioning, lower operating costs and enhanced environmental compliance for years to come. In addition, we still maintain a very strong balance sheet and the high liquidity availability provides us with the means to jump on, on any other interesting investment opportunity that may appear.

With that, I'll turn the call over to Tasos Aslidis to take you through the financial results for the first quarter of 2026. Tasos, please go ahead.

Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next few slides, I will give you the usual overview of our financial highlights for the first quarter of 2026 and provide also a comparison with the corresponding period of 2025.

For that, let's turn to Slide 18. For the first quarter of 2026, we reported total net revenues of $55.8 million, representing a 1% decrease over total net revenues of $56.4 million during the first quarter of 2025 as we operated 3 fewer vessels in this period compared to last year's one. The company reported a net income for the period of $32.5 million as compared to a net income of $36.9 million for the first quarter of 2025. Interest and other financing costs for the first quarter of 2026 amounted to $3 million, while interest income and interest from financial securities amounted to $1.7 million, resulting in the $1.3 million net interest number that you see on the slide.

For the same period of 2025, interest and other financing costs amounted to $4 million against which we collected interest income and imputed -- credited imputed interest of $0.6 million. The decrease in the interest amount we paid is due to the decreased amount of debt in the current period compared to the same period of 2025.

Also for the first 3 months of 2026, the company recognized a $0.35 million of unrealized mark-to-market loss on marketable equity securities. An unrealized loss of $0.8 million on investments in debt securities does not influence our net income and is not included in this slide, but is shown as other comprehensive loss in our press release below our net income line.

Adjusted EBITDA for the first quarter of 2026 was $40.9 million compared to $37.1 million that we achieved during the first quarter of 2025. Basic and diluted earnings per share for the first quarter of this year were $4.65 basic and -- $4.67 basic and $4.65 diluted calculated approximately on 7 million weighted average number of shares outstanding compared to basic earnings per share of $5.31 in the first quarter of 2025 and diluted earnings per share of $5.29 for the same period, again, calculated on about 6.95 to 7 million weighted average number of shares outstanding.

The adjusted earnings per share for the first quarter of 2026 were $4.72 basic and $4.70 diluted, having been adjusted for the unrealized loss of investments in equity securities as compared to adjusted earnings of $3.76 basic and diluted for the first quarter of 2025, which have been adjusted for the gain on the sale of a vessel and the effects for the amortization of below-market charters. We believe the adjusted earnings better represent an ongoing operational profitability of our company.

Let's now turn to Slide 19 to review our fleet performance. As usual, we'll start our review by examining first our utilization rates for the first quarter of this year and compare it to the same period of 2025. I will focus only on the total utilization rate, which stood at 100% for the first quarter of 2026 as compared to 99.2% for the first quarter of 2025.

During the same period, the first quarter of 2026, we operated -- we owned and operated 21 vessels, earning an average time charter equivalent rate of $30,354 per day compared to 23.7 vessels for the same period of last year, earning on average $27,563 per day.

Our total operating expenses, including management fees, general and administrative expenses, but excluding any drydocking costs, were $7,789 (sic) [ $7,889 ] per vessel per day in the first quarter of this year compared to $7,511 during the same period of 2025.

If we move further down on this table, we can see the daily cash flow breakeven level, which takes into account, in addition to the operating expenses, the drydocking expenses, interest expenses and loan repayments without balloon repayments, all of those expressed on a dollar per day basis. For the first quarter of 2026, our daily cash flow operating breakeven rate was $12,347 as compared to $13,062 for the first quarter of 2025. The reduction primarily being due to the lower -- significantly lower drydocking expenses and reduced interest costs, which more than offset some small increases in operating expenses.

At the bottom of this table, we also present our dividend expressed on a per vessel per day basis. For the first quarter of 2026, this stood at $2,763 per vessel per day compared to $2,118 per vessel per day for the first quarter of last year and reflects both the increase of the dividend in absolute terms, but also the smaller number of vessels by which the dividend has to be carried on.

Let's now turn to Slide 20. In this slide, we aim to provide a better perspective of the depth of our contract coverage. The table presents the development of our fleet ownership days over the next 3 years with an estimated breakdown of how many days are available for hire and how many days are already contracted. It incorporates necessarily assumptions about delivery dates for our vessels under construction, scrapping for older ships, estimated drydocking costs and also timing and duration of drydocking, utilization assumptions going forward and estimates for the redelivery dates of our vessels from the current charters.

The data presented in this table represents internal estimates and are provided for indicative purposes and to be used for modeling. Future time charter equivalent revenues and actual results may differ. Nevertheless, we believe this provides a useful visibility into our forward revenue and earnings profile.

Our contract coverage that Aristides has already mentioned, currently stands at about 92% for 2026, a bit more than 75% for next year and about 43% for 2028. And average contracted rates, I will not repeat here, you can see them on the slide, are over $30,000 for each of the respective years.

Let's now turn to Slide 21 to review our debt profile. As of the end of March of this year, our total debt stood at about $213.3 million with an average interest rate margin of about 2%. If we assume a SOFR rate of 3.65%, the total cost of our debt would stand around 5.65%, which is well within the prevailing rates for our peers.

Turning to our debt amortization profile on the top left part of the slide, we can see that in 2026, total debt repayments amount to approximately $19.5 million, consisting of approximately $14.2 million of scheduled loan repayments and $5.4 million of already repaid loan obligations. In 2027, total debt service increases to approximately $37 million, again, comprising of $17 million approximately of scheduled loan repayments and the $20 million balloon repayment. Repayments of loans moderate down to $12 million in 2028 with no balloon payments due in that year.

Looking further ahead, 2029 includes total repayments of approximately $40.6 million, again, consisting of $10.6 million of scheduled repayments and a $30 million balloon payment. While 2030, quite far in the future, I have to admit, includes total repayments of $33.8 million, again, split between $7.4 million of scheduled repayments and a $26.4 million of balloon repayment.

Historically, we have been able to refinance balloon payments on favorable terms when appropriate and when desired, and we expect to be able to maintain the same capability in the future for the future balloon payments if we choose to refinance them. These figures do not include debt that we will assume to finance our newbuilding program. This repayment profile refers only to debt that we currently have.

At the bottom of this slide, we show our cash flow breakeven estimates for the next 12 months, broken down by -- in the various components. On this basis, our total cash flow breakeven level for the next 12 months stands approximately at $12,760 per vessel per day, a level that is well below, if you remember, the contracted rate that we have for our fleet, but also the prevailing rates in the market.

To conclude this presentation, let's turn to Slide 22 for a review of our balance sheet and have some highlights of the balance sheet, actually. As usual, we show our balance sheet in a simplified way in the form of 2 bars. On the left bar, we show the asset side. We have current assets, cash and other current assets of approximately $218 million, which translates to $31 per share equivalent. We also have made approximately $45 million of advances against our newbuilding program. While the book value of our existing fleet stands at about $460 million, bringing altogether the book value of our assets to $722.7 million.

On the right bar of this slide, on the liability side, as I mentioned, we have debt of $213.3 million and various other liabilities amounting to about $19 million, resulting in book shareholders' equity of just above $490 million. However, the book value of our assets is significantly lower than their market value. Based on our own estimates and estimates from other parties, we estimate that our fleet -- our current fleet is valued at approximately $675 million, which translates to a net asset value for the company of more than $700 million, $706 million, or around $100 per share. We closed yesterday our share price at just above $71 per share, which indicates that our stock traded yesterday at almost 30% discount to its net asset value. This highlights -- this difference -- this gap highlights the potential appreciation of stock price given the depth and the level of our contracted revenues.

And with that, let me pass the floor back to Aristides to continue the call.

Thank you, Tasos. Let us now open up the floor for any questions you may have.

[Operator Instructions] Our first question is from Mark Reichman with NOBLE Capital Partners.

I'm looking at the fleet profile, and I'm looking at the TCE rate for the intermediates that have vintages in like 2008 and 2009. And then I'm looking at the vessels under construction and the TCE rates are pretty much the same. And I was just kind of wondering, could you talk a little bit about the economics of the newbuilds versus the older vessels and just the tenor of the market. Are charters willing to pay a premium for the newer vessels? Or what's the dynamic there? And that would be helpful.

Yes. They are getting, as you correctly say, very similar rates, but the reason for this is not that the ships are equivalent because they are not. The fuel consumption of the newer vessels, I think, it's about 20% better than the older vessels despite the ESDs that we are performing on them. However, these ships with deliveries 2 years down the line. So that is the reason why we're not getting a better price today. If we were to have these ships available today, I would think they would definitely demand a significantly higher level than the 2008 and 2009 build ships.

I can add that it is also the length of the charter. Our new ships have charters that go out 4 years, while the existing ones are 2 to 3 years when the charters were concluded. So that also plays a significant role.

Our next question is from Poe Fratt with Alliance Global Partners.

I have a couple of questions, if I may. The first of which is, Tasos, would you just give us in broad terms the newbuild CapEx that with the new orders that you're looking at for 2026, '27 and '28?

Yes. I mean I think it's -- I'll be happy to provide that perhaps after the call. It's -- obviously, we have 10 ships on order that they range in cost from $40 million to $60-something million. So the overall newbuilding program is in excess of $500 million and of which you can assume that 55%, 60% is in debt. So $200 million plus is the equity portion of which we have paid $45 million, as I mentioned earlier. And with the exact timing, I'll be happy to provide offline.

Okay. And then can you just talk about the rationale of doing the JV with NRP investors as opposed to just doing straight debt financing?

Yes. We view this more as a strategic investment rather than that we needed the investors or we needed the financing. But we believe that the Norwegian investors are quite active in the shipping markets, and we wanted to create a better liaison with them. And through this transaction, we got about 10, 11 Norwegian investors who invest together with us. They'll get to hear about Euroseas and follow what we do. So we think that it's helping us be best well known in the Norwegian market as well.

And Aristides, would this be considered sort of a one-off? Or is this the first of others that you might do on your newbuilding program?

We haven't decided about doing something else yet. We might do 1 or 2 more ships, but we will see as time goes by.

Okay. And then good...

I remind you -- sorry, Poe, I remind you that with the same outfit, we have done 2 vessels in EuroDry, right? So we've got to know quite well, and we have a very good working relationship with these guys.

Okay. Great. And then good charters, time charters on the Kea and Spetses. Can you just talk about the outlook for the rest of the year on the chartering front? And is it -- are we at the point where maybe the Evridiki does get retired at this point in time? Or do you think that, that will continue to work?

Yes. We have always been budgeting that Evridiki would retire at the end of this current charter. But I can tell you that we have already taken the decision to pass it through its special survey because we are seeing interest for chartering it at levels that really make sense us keeping the vessel. So nothing to report now, but I can only say that we are going to pass its special survey.

The outlook right now still is extremely strong for feeder vessels and intermediate vessels. There is very few opening up globally within the next 3 to 4 months. And I expect that within the next few days or a couple of months, we will have fixed everything that opens up this year and have 100% coverage.

And this is probably not a fair question, Aristides, but closer to the Kea or the Spetses as far as the rate?

The ships that open up, I think, are just 3 vessels that are opening up within this year still. And they are smaller ships, the size of the Spetses, I would say. So charter rates should be around that level.

There are no further questions at this time. I would like to turn the floor back over to Mr. Pittas for closing remarks.

Thank you all for listening in, in today's presentation. We will be back to you -- with you in 3 months' time. Thank you.

Thanks, everybody.

Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your participation.

Thank you for standing by, ladies and gentlemen, and welcome to the Euroseas Conference Call on the Fourth Quarter 2025 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. [Operator Instructions] I must advise you that this conference is being recorded today. Please be reminded that the company announced their results with a press release that has been publicly distributed.

Before passing the floor over to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. I kindly draw your attention to Slide #2 of the webcast presentation, which has the full forward-looking statement, and the same statement was included in the press release. Please take a moment to go through the whole statement and read it.

And now I would like to pass the floor over to Mr. Pittas. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me is Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the 3- and 12-month periods ended December 31, 2025.

Please turn to Slide 3 of the presentation for our quarterly financial highlights. For the fourth quarter of 2025, we reported total net revenues of $57.4 million and net income $140.5 million or $5.79 per diluted share. Adjusted net income for the quarter was $31.3 million or $4.48 per diluted share. Adjusted EBITDA for the period was $40.7 million. Please refer to the press release for the reconciliation of adjusted net income and adjusted EBITDA. Also, slides will go over our financial highlights in more detail later on in the presentation.

As part of the company's common stock dividend plan, we are pleased to announce that the Board of Directors increased the quarterly dividend by 7% to $0.75 per share for the fourth quarter of 2025. This represents an annualized dividend per share of $3, resulting in an annualized dividend yield of about 5% based on our current share price.

Additionally, since the launch of our $20 million share repurchase program in May 2022, which have repurchased 480,000 shares of our common stock in the open market, representing about 6.8% of our outstanding shares for an aggregate price of approximately $11.4 million. Following 2 1-year expansions, the program was renewed for the first time in May 2025. We intend to continue executing our repurchase program in a disciplined manner deploying capital when appropriate to support and enhance our long-term shareholder value.

Please turn to Slide 4 for an overview of our recent developments where we highlight key and class vessel sales and [indiscernible] starting activity and operational performance. As previously announced, we successfully completed the sale and delivery of Motovessel Marcos V to have new unaffiliated dollars on October 20, 2025. This transaction generated a gain on sale of $9.2 million.

On the chartering front, we secured multiyear employment for several vessels, further strengthening our revenue stability. Multiverse Gregos, [indiscernible] and [indiscernible] were all fixed for about 3 years at an attractive daily rate of $30,000 per day. In addition, Marcos vessel spaces were peaked for a minimum of 22 months to maximum of 24 months at a daily rate of $21,500 per day. We have no item or commercial of hire days for the period.

Now please turn to Slide 5. Our under note fleet currently consists of 21 vessels with a total carrying capacity of 61,000 TEUs and an average age range of 13.1 years. This includes 6 intermediates directors with the combined carrying capacity of cooking [ 25,500 ] and an average age of 18.2 years and 15 [indiscernible] vessels with the combined having capacity robot 45,000 TEU and an average age of 9.4 years. In addition, we have 4 intermediate vessels under construction each with a capacity of 4,480 TEUs. Two of these are expected to be delivered in the third and fourth quarters of 2027 and the remaining 2 in the first and second quarter of 2028, adding a further 18,000 TEU capacity to our fleet.

On a fully delivered basis, our fleet will grow to 25 vessels with the carrying capacity of approximately 80,000 TEU.

We are now connected.

Sorry for the interruption, we had the line breakdown. I hope you can hear me. I will continue. I just described the 4 4,484 TEU vessels that we expect to take delivery in 2027 and 2028. So now please turn to Slide 6 for a further update on our fleet employment. We continue to benefit from high level of forward coverage.

Looking ahead, we have secured a high degree of revenue visibility in the next several years. For 2026, 87% of our available voyage days have been fixed at an average daily rate of approximately $30,700 per day. In 2027, our coverage stands at about 71% with an average rate of around $31,900 per day. [indiscernible] for 2028, we already have 41% of our days secured at an average rate of around $32,400 per day. These forward covers achieved through our disciplined chartering strategy allows us to balance market exposure with earnability across different phases of the cycle. It provides meaningful cash flow visibility and positions us to sustain profitability over the next several years, even in the event of a sudden market correction.

Moving on to Slide 8, let's review the key market developments during the fourth quarter of 2025. One year time charter rates remained firm at historically elevated levels supported in the near term by a substantial portion of the fleet befits forward. These forward coverage has helped sustain charter rate resilience even while the freight market softened amid increased vessel supply and seasonally weaker demand.

With Sanga containerized trade index recovered by approximately 13% from near 2-year lows recorded in late September. On a quarter-on-quarter basis, average rates across the major container segments were largely unchanged and continue to hover around similar high levels. Secondhand asset prices remained stable in the fourth quarter of 2025 compared to the previous quarter. This resilience was supported by limited vessel availability and continued competition on mobiles seeking to expand their fleets and meet ongoing trade disruptions.

Meanwhile, the Newbuilding price index declined modestly, easing by 1.5% quarter-over-quarter. After an extended period of strong growth, containing Newbuilding prices softened compared to -- in the fourth quarter compared to the third, as yards are mostly full till the end of 2028 and consequently, ordering activity has slowed. However, prices remain high by historical standards.

Idle fleet capacity has trended steadily downward and is now approaching negligible levels. Recycling activity remained muted in 2025 with just 11 vessels being scrapped during the year. Scrap prices have recently softened to around $435 per light [indiscernible] in Bangladesh.

Overall, the global fee lead expanded by approximately 7% in 2025.

Please turn to Slide 9 for our broader market overview focusing on the development of 6 to 12 months' time charter rates over the past 10 years. As illustrated on the slide, charter rates across all major containership segments remain meaningfully above the respective 10-year historical averages and median levels. While rates have moderated from the extraordinary peaks of 2021 and 2022, they continue to reflect a structurally stronger earnings environment than the long-term loans. This is particularly evident in the feeder and intermediate segments where demand remained solid. These vessel classes continue to play a critical role in maintaining network flexibility and supporting regional and intraregional trade flows especially amid ongoing geopolitical uncertainties and supply chain realignment. Moreover, limited vessel availability at the moment combined sustained demand has continued to support the elevated time charter rates.

Please turn to Slide 10. According to the IMF 2026 wealth economic outlook update, the global economy is projected to maintain a resilient expansion with GDP growth in our forecast at 3.3% in 2026 and 3.2% in 2027, reflecting a slight upward revision to the outlook relative to last October's projections. Inflation pressures are expected to reach further with headline inflation declining from an estimated 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027, supporting a gradual return to target price stability.

Despite relatively stable medium-term outlook, there are still meaningful downside risks though. These include the possibility that expectations around technology-driven growth proved too optimistic, as well, of course, as the risk of escalating geopolitical tensions. Ongoing trade frictions and broader geopolitical fragmentation continue to create uncertainty for the global economy. The recent events in Venezuela, Greenland and the Middle East remind us that external risks that remain always present. With that said, some trade pressures could possibly ease in 2026, which could help reduce the drag from the tariffs on overall growth.

In the United States, growth is projected to remain broadly steady with GDP growth expanding by about 2.4% in 2026 and 2% in 2027, although business and consumer sentiment appears subdued and inflation is expected to ease towards target only gradually.

Among emerging markets and developing economies, India is focused to remain one of the fastest-growing major economies with GDP growth projected at about 6.4% for both 2026 and 2027, which is undermined by robust domestic demand and investment momentum. The [indiscernible] region is projected to also maintain solid growth with expansion of 4.2% in 2026 and 4.4% in 2027, supported by strong domestic investment and technology experts even amid global trade uncertainties and tariff pressures.

Finally, China's growth trajectory is expected to moderate more with GDP forecast at 4.5% in 2026, down from 5% in 2025 and easing further to 4% in 2027. The slowdown reflects pressure from weaker external demand, subdued manufacturing investment and ongoing challenges in the property sector. While segments of the economy, particularly exports and AI-related investments continued to grow at a healthy pace, broader domestic demand remains soft pointing to an increasingly [indiscernible] recovery.

On the container trade, according to Clarksons' latest estimates, container trade growth is projected to soften, with TEU mile demand expected to decline by approximately 1% in 2026 and 5.5% in 2027. This decline is solely due to the expectation that trading through the wars will normalize during these 2 years. Some of this artificial uplift in TEU mile demand is expected to unwind beginning in 2026 with a more pronounced impact anticipated in 2027. At the same time, the substantial newbuilding capacity offered during the pandemic period scheduled for delivery over the coming years. This influx of tonnage is likely to face underlying demand growth at certain points in the cycle, particularly if geopolitical disruptions is more rapidly than expected and vessels are able to return to more efficient routes.

Turning on to Slide 11. You can see the total fleet age profile and containers outlook. The top left chart shows that the total containership fleet remains relatively young with the majority of vessels under 15 years of age and only about 13% of the fleet over 20 years old. This, however, changes drastically if you look in the feeder and intermediate segments in isolation, which we will go over in the next few slides.

Staying on this slide for a moment, the top right chart illustrates scheduled new deliveries as a percentage of the existing fleet stood at approximately 5% for 2026, 8.5% for 2027 and 17.6% for 2028 onwards, although actual fleet growth is expected to be somewhat lower due to slippage and future demolition activity.

The bottom chart shows that the order book has increased to close to 35% of the fleet as of February 2026.

Let's turn to Slide 12, where we highlight the fleet age profile and low book specifically proceeds in the 1,000 to 3,000 TEU range, which represents our feeder fleet. As of February 2026 order book for vessels below 3,000 TEU stands at a relatively modest 10% of the fleet. At the same time, roughly 28% of the fleet is over 20 years old. This dynamic points to a clearing balance between limited newbuilding activity on one side and an aging fleet on the other. As environmental regulations tighten and compliance costs increase, a meaningful portal of [indiscernible] vessels are likely to be scrapped. According to Clarksons, deliveries in this size range remain limited with new bidding additions projected at only 2.4% of the fleet in 2026, followed by 3.9% in 2027 and 3.8% in 2028 and beyond.

Let's move to Slide 13 now to see the supply outlook for the 3,000 to 8,000 TEU segment, representing the intermediate containership segment. As of February 2026, the order book here stands at 17% of the split, a modest level compared to the largest main classes. Meanwhile, the age profile of this segment is also notably advanced with almost 29% of vessels being over 20 years old and another [ 27% ] between 15 and 19 years. With a limited new building pipeline, net fleet growth in this segment is expected to remain contained over the next few years.

Moving on to Slide 14. This chart places those dynamics in the broader context across the entire containership sector. What becomes very clear is how sharply the over book is concentrated in the larger vessel classes. Net Panamax and Post-Panamax units saw order books of 40% to nearly 80% of the existing fleet, in line with the significant capacity being added to the main lane freights. By contrast, the feeder and intermediate segment saw significantly smaller order books, ranging from just 4% to 18% depending on size despite a meaningful share of these fleets between 20% and almost 40% already being more than 20 years old. This widening gap between new building activity in the large vessel segments and the more limited replacement of smaller sizes, highlights why our core segments remain structurally well positioned with minimal risk of oversupply.

Now please turn to Slide 15 for a synopsis of our outlook on the container sector. Trains remain multifaceted. While time charter rates remain strong, weaker freight rates, firm fleet growth, microeconomic uncertainty and the possibility of vessels being rerouted again via the red sea, points to the potential for a softer market environment ahead. Overall, time charter rates remain near historical highs. Looking into 2026, the container sector is expected to deliver one of the lowest order books in recent years with only 5% expected to be delivered versus 8.5% expected to be delivered in 2027 and over 17% in 2028 and beyond. However, any return to normality in routes could release effective capacity back into the market, potentially putting pressure on rate and prompting further network adjustments.

Looking further ahead to 2027 when containers in deliveries are set to accelerate, we could experience additional softening in container shipping markets. While capacity manager and hire demolition management and high demolition activity may help mitigate part of this pressure, the sector still faces the potential for a more challenging supply-demand balance.

The energy transition continues to pick up speed in the containership sector. alternative fuels are clearly on the horizon, but the shift is not happening overnight. Technical challenges, economic hurdles and delays in finalizing the IMO net zero framework mean the journey to zero emissions will be gradual. Still, the momentum is undeniable, and the industry is steadily charting a course towards an even cleaner future.

Let's turn to Slide 16. The left-hand graph shows the cycle of the 1-year time charter rate for 2,500 TEU containerships over the past 10 years. As of February 20, 2026, the 1-year time charter rate stands at $36,000 per day, well above both the 10-year historical average and median levels. This firm rate environment is mirrored in asset values as well. Newbuilding vessels are now valued at approximately $43 million compared to a 10-year median of $35 million and average of roughly $36 million. Likewise, 10-year-old secondhand vessels are currently valued at $37.5 million, significantly higher than the 10-year historical median of $15 million and historical levels of about $21 million.

The competitive firmness in charter rates and asset values highlights the underlying resilience of the containership market and reflects a robust long-term fundamentals that continue to underpin demand for these vessels.

Our financial strength allows us to act strategically as attractive investments emerge in both the [indiscernible] and Newbuild segments. Supported by our strong liquidity profile and revenue visibility, we believe we are well positioned to further enhance shareholder returns. Our investors can rely on us continuing to offer a meaningful dividend as our recent 7% increase demonstrates, whilst retaining excess earnings for further optimize growth.

And with that, I will pass the floor to our CFO Tasos Aslidis, to go over our financial highlights in more detail.

Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next few slides, I will give you the usual overview of our financial highlights for the fourth quarter and full year of 2025 and compare them to the same periods of the year before, 2024. We now let's turn to Slide 18. For the fourth quarter of 2025, the company reported total net revenues of $57.4 million, representing a 7.7% increase over total net revenues of $53.3 million during the fourth quarter of 2024, the increase mainly due to the result of the higher charter rates earned in the fourth quarter of 2025 compared to the corresponding period of the previous year, partly offset by the decreased average number of vessels that we operated in the fourth quarter of 2025.

Consequently, including the $9.2 million gain on the sale of our vessel Marcos V during the fourth quarter, we reported a net income for the period of $40.5 million as compared to a net income of $24.4 million for the fourth quarter of 2024. Total interest and other financing costs for the fourth quarter of 2025 amounted to $3.4 million compared to $4.1 million for the fourth quarter of the previous year before accounting for $0.6 million of [indiscernible] interest income related to the self financing of the predelivery payments for 1 of our new buildings at the time, which was capitalized. This decrease is mainly due to the decreased benchmark interest rates of our bank's loans in the current period, the fourth quarter of 2025, partly offset by a slightly higher amount of debt we carried.

During book periods, we recorded interest income of about $0.8 million. Adjusted EBITDA for the fourth quarter of 2025 increased to $40.7 million compared to $32.8 million for the corresponding period 2024, a 24% increase, primarily due to the higher revenues we collected.

Basic and diluted earnings per share for the fourth quarter of 2025 were $5.92 and $5.79, respectively, calculated approximately and about 7 million basic diluted weighted average number of shares outstanding compared to basic diluted earnings per share of $3.51 and $3.49, respectively, for the fourth quarter of 2024. Excluding the gain on the sale of vessel -- for vessel and the unrealized income or loss on derivatives, the adjusted earnings per share for the fourth quarter of 2025 would have been $4.50 basic and $4.48 diluted, one of our highest quarters, compared to adjusted earnings per share of $3.35 basic and $3.33 diluted for the same period of 2024, during which, we also had to adjust our results for the contribution of the fair value of below-market charter rate contracts and the related depreciation.

Let's now look at the numbers for the full year 2025 and compare them to the full year of 2024. For the full year of 2025, the company reported total net revenues of $227.9 million, representing a 7% increase, with total net revenues of $212.9 million during the fourth quarter of -- during the full year of 2024, and that, again, mainly as a result of the higher number of vessels we owned and operated and the higher average time charter [indiscernible] earned during 2025. We reported a net income for the year of 2025 of $137 million compared to a net income of $112.8 million during 2024.

Total interest and other financing costs for the 12 months of 2025 amounted to $15.1 million, again not including $0.1 million of imputed interest income compared to interest and other financing costs of $13.8 million during 2024, not including a gain of $4.2 million of [indiscernible] interest income in relation to our newbuilding program.

This increase is mainly due to the increased amount of debt in the current period compared to the same period of 2024.

Adjusted EBITDA for the 12 months of 2025 increased $155.9 million compared to $135.8 million during 2024, a 15% increase, again, primarily the result of the higher revenues we collected.

For the full year of 2025, we recorded $19.4 million gain on sale of vessels, a $10 million gain on the sale of motor vessel and early in the year at $9 million, and a $9.2 million gain on the sale of motor vessel Marco compared to $5.7 million gain on the sale of [indiscernible] vessel and Astoria we recorded during 2024.

Basic and diluted earnings per share for 2025 were $19.73 and $19.72, respectively, calculated on about 6.9 million basic diluted weighted average number of shares outstanding compared to basic diluted earnings percent of $16.25 and $16.20 during 2024.

Then excluding the gain on sale of vessels, the unrealized income or loss of derivatives on derivatives and the contribution of the fair value of below market time charter contracts and related depreciation for the relevant period, the adjusted earnings per share for the 12 months ended December 31, 2025, which have been [ $16.75 ] basic and $16.74 diluted compared to $14.92 basic and $14.97 diluted for 2024.

Now let's turn to Slide 19, which highlights our fleet performance. As usual, we report our utilization rate there. And our [indiscernible] figures are near 100% across all periods. So I will not get into describing detail in the individual utilization rates. On average, 21.22 vessels were owned and operated during the fourth quarter of 2025, earning another extend charter equivalent rate of $30,268 per day compared to 23 vessels during the fourth quarter of 2024, [indiscernible] $26,479 per day. Our total daily operating expenses, including management fees, G&A expenses, but excluding [indiscernible] costs, were $8,284 per day during the fourth quarter of 2025 compared to $7,728 per vessel per day for the same period, the fourth quarter of 2024. If we move further down in this table, we can see the cash flow breakeven levels, which take into account the above expenses, in addition, interest and [indiscernible] expenses and loan repayments without accounting for balloon payments.

For the fourth quarter of 2025, our daily cash flow breakeven level on that basis was $13,009 per vessel per day compared to $13,936 per vessel per day for the fourth quarter of 2024.

Finally, below the breakeven line, you can see the dividend we distributed expect in dollars per vessel per day, and that amounts to live more than $2,000 for [indiscernible] in effect, [ $2,539 ] for the fourth quarter of 2025, where the debt term was increased and $2,035 for the fourth quarter of 2024.

Let me quickly review the annual figures on the right part of this slide. Again, the full year -- for the full year of 2025 and 2024, utilization rates were near 100%. So let me jump and say that the, on average, 22.2 vessels were owned and operated during 2025, earning, on average, $29,007 per day compared to 21.7 vessels in 2024, earning, on average $28,054 per day. Total operating expenses for the full year, including non-decision G&A expenses, but again, without for diverting costs were $7,600 in 2025 compared to $7,526 in 2024. The flow breakeven level for the full year, [indiscernible] up being $13,100 in 2025 compared to $14,794 for 2024. And again, in the last line, we can see the dividend we paid expressed in dollars per vessel per day, and that amounted to $2,335 in 2025 versus $2,131 in 2024.

Let's now turn to Slide 20. And in this slide, we want to provide a better perspective of the depth of our contract coverage, especially in light of the recent charter that we concluded and a civil mentioned earlier in the presentation. The 1 presents the development of our fleet ownership days over the period of the next 3 years, and an estimated breakdown of how many these are available for hire and how many days are already contracted. It incorporates assumptions about delivering day for the vessels under construction, scrapping days for older ships, [indiscernible] drydocking and timing and duration, utilization assumption going forward and estimates for contracted days and average contractor date. Please note that the data presented in this page presents our internal estimates provided for indicative proposition used for modeling future time charter equivalent revenues and actual results may differ. Nevertheless, we believe this provides a useful visibility to our forward revenue and earnings profile.

Our contract coverage can stands at approximately 87% for 2026, 71% for 2027 and about 41% for 2028 as Pittas mentioned earlier. Average contracted rates are approximately $30,700, $31,890, and $32,400 per day for the respective years.

We hope the framework will assist investors and analysts in evaluating any potential forward by making the rolling assumption for the uncontracted days of the fleet and coming to an estimate of our revenues and future profitability.

Let's now turn to Slide 21 to review our debt profile. As of December 31, 2025, our total outstanding bank debt stood at about $218.4 million with an average interest rate margin of about 2%. We assume a 3-year SOFR rate of 3.7%, the total cost of our debt stands at about 5.7%, which is well within the prevailing rates for our segment and peers.

Turning to our debt amortization profile. In 2026, [indiscernible] payments amount to approximately $19.5 million. In 2027, our total debt service, debt repayments increases to about $36.8 million, consisting of $16.8 million of regular repayments and a $20 million balloon in payment. The payments moderated to approximately $12 million in 2028 with no balloon maturities during that year. Looking further as said, 2030 includes total repayments for about $33.8 million, again, comparing $7.4 million of scheduled repayments and $26.4 million ballon payment. In the past, we were able to refinance balloon repayments routinely, if we chose to do so. and this remains our expectation for the upcoming value payments over the next 5 years, shown in this chart. If we choose to refinance them, we expect to be able to do so relatively straightforward.

Please also note that this table show here does not include debt that we expect to draw to finance the construction of our 4 new buildings, which we estimate to be in the range of $140 million to $150 million for the 4 vessels.

Overall, our debt maturity profile remains well targeted with no significant near-term refinancing pressure.

At the bottom of this slide, we show our cash flow breakeven estimate for the next 12 months broken down by its key components. On this basis, our total cash flow breakeven level for the next 12 months stands approximately $12,200 per vessel per day, a level well below the contracted and prevailing earnings of our fleet. Given the average earnings of our fleet for 2026 stand above $30,000 per vessel per day, [indiscernible] appreciate the cash flow generation that our vessels provide.

To sum up my remarks, let's move to Slide 22 to review some highlights from our balance sheet. As of the end of last year, cash and other current assets totaled $188.7 million. We've already made about $35.9 million in advances for our newbuilding vessels. The book value of our fleet stood at $465 million, bringing -- $465.9 million, bringing the total book value of our assets to about $700 million. On the liability side, as I mentioned in the previous slide, we had debt amounting to $218.6 million and other liabilities amounting to about $18.2 million, resulting in a shareholders book equity of roughly $463 million. However, the market value of our fleet is significantly higher than their respective book value.

According to our last estimates, our fleet is valued at approximately $664 million, which translates into a net asset value for our company of about $660 million or around $93.7 per share. With our last closing price, the recent trading range of $62.4 per share, our stock [indiscernible] at almost 33% discount to [indiscernible] net asset value. That highlights the appreciation potential that our stock has given the discount and the depth of our contracted revenues.

And with that, let me pass the floor back to our Aristides to continue the call.

Thank you, Tasos. Let me now open up the floor for any questions you may have.

[Operator Instructions] Our first question comes from the line of Mark Reichman with Noble Capital Markets.

Well, I know you've got some of those balloon payments coming up, but I was just wondering, given your strong liquidity and contracted backlog, how are you prioritizing kind of between the dividends and share repurchases, secondhand acquisitions and potential new build orders? [indiscernible] capital allocation priorities?

Yes, yes, yes. We will continue giving a strong dividend to our shareholders. We will continue looking at opportunities to grow the company accretively we don't see such opportunities currently on the secondhand market. So we are more focused on the new building market we will keep very moderate leverage. And we will capitalize whenever there is an investment opportunity to do. I think that's the strategy in one minute.

Okay. On the last call, you had mentioned that containership orders had accelerated as charters had committed to take new ships on charter for longer periods, even with deliveries well into the future. And I think you had mentioned that with that new supply, you thought that rates for older vessels to experience pressure beyond 2026 unless demand accelerates. So it just seems like the containership market is kind of transitioning towards those newer vessels. But do you -- it sounds like you kind of expect scrapping to accelerate meaningfully over the next 2 to 3 years? And to what extent do you think that could offset the new deliveries?

Scrapping will not happen unless we see charter rates falling, right? Because now even where the old vessels continue to get employment at very decent rates. So as soon as the market drops, though, I would expect a significant increase in the number of ships that go to the scrapyard because indeed, the other age of the fleet has grown dramatically. So first step that will happen is the market will drop at some point, perhaps because the world find some equilibrium and we start trading through this Suez and don't have such disruptions. That will mean there will be too many ships around. That will mean the market will fall, charter rates will drop, vessels will be scrapped, older vessels will be scaled and then we will be buying more second-hand vessels at significantly lower prices.

The newbuilding market has grown sufficiently as we discussed. But now one can expect to take a newbuilding delivery in 2029 onwards. So this makes quite a lot of people reluctant to place order when they're going to receive the vessels 3, 4 years down the line.

Okay. And then just -- I asked this question generally every conference call. Could you just provide some visibility on the off-hire or drydocking days in 2026 and maybe even 2027?

It will be -- I'll be happy to provide that, I mean, I do have on the top of my head, the dry docking schedule for the next year...

It's Very, very limited. It's very, very limited for this year.

So I've gone through most of the as I said, [indiscernible]?

We have 2, I think, within the year.

And whatever...

And the expenses are pretty minimal for the next 12 months so...

You con tell from the from the chart on Slide 8 on that the table component is very small per day, so that is reflective, I guess for the...

Our next question comes from the line of Tate Sullivan with Maxim.

Inarguably, I think asset values and the long-term contracting value for the sector has gone up and M&A probably lifting higher, but separately on the other side, I mean, I see operating expenses per day of $7,000 roughly in the fourth quarter, up about 5% year-over-year. based on our exposure in the sector, can you is pricing higher for crew cost supplies? Or what do you see across your [indiscernible]?

A big part of those, Tate, is the dollar-euro exchange rate that was the opposite for us during the fourth -- during the latter part of 2025. A portion of our operating expenses are in euros, the management fee and some other expenses. So that is part of it.

Are you seeing any higher salary costs, salaries...

in crew salaries?

Yes, crew salaries and probably not to that 5% increase amount. Or is that...

Increases are below 5%, both on crew costs and G&A. It's mainly the euro-dollar thing that has increased a little bit spare parts, management fee costs things like that affected by the Euro-dollar.

Also, please note that on the quarter at least, where we operated 2 versus less in the fourth quarter of this year, the G&A component is divided by a smaller number of ships. And so that's why the -- you see probably a little bit bigger jump on a per day base -- on a per vessel basis.

Okay. And while I have you too, I mean, the dividend policy impressive streak of dividend increases. How do you -- you and your Board evaluate the dividend? I mean, how do you compare what you see from other containership companies? Are you looking at a 20%, 30% payout ratio or depending on the year, please?

We don't have a steady payout ratio that some other companies have, but we do have a strategy of providing a very decent dividend to our shareholders. I think our current dividend yield of around 5% is about the lowest levels we will have with that.

So if need, we might pay out more out of our -- repay out of our revenues in dividends so that we continue to pay a very decent dividend.

Our next question comes from the line of Poe Fratt with Alliance Global Partners.

You've covered a lot of ground and you always do a comprehensive overlook of the -- overview of the industry. [indiscernible], if you could just highlight what the near-term prospects are for some of your upcoming open days, specifically looking at the older assets, the [indiscernible], the -- I never pronounce this correctly, but...

[indiscernible]. It's the name of my grandmother.

I know, and I would apologize for pronouncing her name incorrectly. I just can't get it. But if you could just talk about the prospects there. And then at what point do you consider consider scrapping those older assets?

I can tell you, Poe, that on all our modeling, we had been assuming up to very recently that the vessels will be scrapped, but the market has proven too strong for this to happen. So we will pass the special surveys and charter amount for minimum 1, hopefully, 2 years. We are discussing with potential charters but I can't make any further comment at this point.

Okay. My -- the implication is that rates are high enough to keep those in the in the fleet active until maybe the 2027 time frame, maybe 2028? So...

Yes, I would say, Poe, that they're going to pass the special servicer now, so they will potentially have another 3 years of life if they pass the special survey. We will be able to trade them for another 3 years before we need another extensive survey. And that's probably the time that they will be scrapped.

Okay. And with the extensive board cover, as you -- as Tasos says, it makes it simpler for us to model out the cash flows and how your financial position is going to look. And even with newbuild costs of $140 million to $150 million, I think, over the next 2 years, I have you in a net cash position, assuming that you don't need to finance those newbuild payments. What you have stock back fairly not as sizable as maybe you would have hoped just given the potential volume constraints. You've increased the dividend, even with the higher dividend you're still being a net cash position. At what point -- and you're talking about newbuilds potentially, but newbuilds would be 2029, 2030 delivery at this point in time. So what -- are you thinking at all about a special dividend to distribute some of the cash to shareholders? I mean, you're -- at least in my model, you're overcapitalized when I look at out into 2027 and even in 2028. Is a special dividend something you might consider?

You are correct, I think, in your calculations. We're not really considering a special dividend at this stage. So -- probably, we are hopeful that we will be able to find use for the extra capital that we currently have, better use than returning it to shareholders, but we will continue providing a very decent dividend to our shareholders.

Yes. And implied in that [indiscernible], I had you increased the dividend in the middle of the year, not at the beginning of the year. Is the potential cadence of dividend increases going to be a little quicker because of how much cash you have on the balance sheet and how much cash you...

That's very probable, but I really can't comment on how we will decide. But the dividend will be decent. Hopefully, our sales price will appreciate. And then we will feel that we need to always have a minimum dividend, and therefore, increase the dividend as well.

[Operator Instructions] Our next question comes from the line of Clement Molins with Value Investors.

Most of this already been covered, but I wanted to follow up on Dave's question on the cost side. is your OpEx guidance for 2026 based on the current euro and USD exchange rate?

The question what is the guidance for what is that we are assuming for the dollar-euro exchange rate?

Exactly. Because your guidance aims lower than Q4 OpEx, and it was like what were the key drivers behind that?

I think there is -- basically every year, we are making a budget for our expected topics for the following year and which reflects potentially special expenses required for certain ships during the period and an assumption for the dollar-euro exchange rate. So I think we expect the dollar-euro to remain in the high teens, [ 115 to 120 ] range. And typically, we budget -- we are finalizing the budgets for this year now, but we -- as a base, we assume the 3% overall increase for our OpEx expenses.

This is exactly what you asked but...

Yes, I was asking like your assumption on the euro-USD exchange rate because you mentioned that is the driver behind the cost increase?

I mean it is in the high teens. [ 1.15 to 1.20 ].

If you -- but for 2025, we started off with [ 1.05 ], we ended at [ 1.15 ]. So that was -- and our costs are maybe, I would say, about 25% overall euro-related.

That's helpful.

[indiscernible].

Our next question is a follow-up question from Mark Reichman with Noble Capital Markets.

I just wanted to follow up on Poe's question. You've got the 4 intermediate vessels to be delivered in '27 and '28. But when you look at your feeder vessels, I mean, you've got a few that are aging. So it's now the time to start ordering some feeder vessels? I mean if there's the lead time, if you're telling us that [indiscernible] and Corfu probably have about 3 years left?

Of course. But we are looking into that possibility to report yet.

We have reached the end of the question-and-answer session. Mr. Pittas, I'd like to turn the floor back to you for closing comments.

Thank you all for attending our today's conference call, and we will be back in 3 months starting with similar kind of results. Thank you.

Thanks, everybody.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.

Thank you for standing by, ladies and gentlemen, and welcome to Euroseas Conference Call on the Third Quarter 2025 Financial Results. We have with us today Mr. Aristides Pittas, Chairman and Chief Executive Officer, sir; and Mr. Anastasios Aslidis, Chief Financial Officer of the company. [Operator Instructions] I must advise you that this conference is being recorded today. Please be reminded that the company announced their results, the press release that has been publicly distributed.

Before passing the floor over to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the federal securities laws. Matters discussed may be forward-looking statements, which are based on current management expectations involve risks and uncertainties and may result in such expectations not being realized.

I kindly draw your attention to Slide #2 of the webcast presentation, which has the full forward-looking statement. The same statement was also included in the press release. Please take a moment to go through the whole statement and read it.

And now I would like to pass the floor over to Mr. Pittas. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you for joining us today for our scheduled conference call. Together with me is Anastasios Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the 3 and 9 months period ended September 30, 2025.

Please turn to Slide 3 of the presentation for our quarterly financial results. For the first quarter of 2025, we reported total net revenues of $56.9 million and the net income of $29.7 million, or $4.25 per diluted share. Adjusted net income for the quarter was $29.6 million, or $4.23 per diluted share. Adjusted EBITDA for the period was $38.8 million. Please refer to the press release for a reconciliation of adjusted net income and adjusted EBITDA. Anastasios Aslidis will go over our financial highlights in more detail later on in the presentation. We are pleased to announce that our Board of Directors has declared another quarterly dividend of $0.70 per share for the first quarter of 2025, payable on or about December 16 to shareholders of record as of December 9.

Based on current price levels, the distribution reflects an annualized yield of approximately [indiscernible]. In addition, since launching our 20 million share reverse plan in May 2022, we have repurchased 466,000 shares of our common stock in the open market for a total of approximately $10.5 million. This plan was renewed in May 2025. We remain committed to utilizing this program thoughtfully and strategically deploying it well appropriately to support and enhance long-term shareholder value.

Now please turn to Slide 4 where we review our recent developments, including updates on our sales and per activity, chartering progress and operational highlights. During the third quarter, we completed the sale of motor vessel Marcos V for $50 million. The vessel has delivered her new and affiliated donors on October 20, and we recorded an estimated gain of $9.3 million on the transaction. On the employment front, we extended the charter for motor vessel Jonathan P for a minimum of 11 months and up to 12 months at a daily rate of $25,000 per day. The earliest delivery under this contract in October 2026. Motor vessel Synergy Oakland was extended just yesterday for a further 36 months following the end of current charter at $33,500 per day.

Finally, also yesterday, our 4 new buildings, Motor vessels, Elena, Thrylos, Nikitas G, Socrates Ch were chartered upon the expected deliveries in second half '27 and first half '28 for the time period of 4 years at a daily rate of $35,500 per day or a 5-year period at first $2,500 per day at charterer's option, which is declarable by November 2026.

Turning on to operations, the motor vessel Emmanuel P successfully completed its scheduled dry docking, resulting in an off-high period of approximately 39 days. As part of this repair, we installed energy saving devices that are expected to deliver fuel savings in excess of 20%. We experienced low rise or commercial of higher time during the Q3.

Now please turn to Slide 5. Our current fleet on the water consists of 21 vessels of total carrying capacity of 61,000 TEU and an average age of about 12 years. This includes fixed intermediate vessels with a combined carrying capacity of 25,500 TEU and an average age of around 17 years as well as 15 feeder vessels with a combined carrying capacity of 35,600 TEUs and the other at the age of 8.4 years.

In addition, we have 4 intermediate vessels under construction each with a capacity of 4,484 TEU. Two of these are expected to be delivered in the second half of 2027, while the remaining 2 in the first half of 2028, adding a further 17,000 TEU of capacity 12 fleets. On a fully delivered basis, our fleet will now grow to 25 vessels carrying capacity of approximately 78,300 TEU.

Please turn to Slide 6 for a further update on our fleet employment. We continue to benefit from strong forward coverage, as you can see. For the first quarter of 2025, the 100% of our available days have already been secured and at an average rate of approximately 30,345 per day.

Looking ahead in 2026, we have already covered 75% of our volume to date at an average rate of around $1,300 per day. In 2027, Discovery stands at an even higher average rate of around $33,500 per day. And even in 2028, it standard at 30% at an average rate of around $35,000 per day. Our disciplined strategy provides us with high visibility of future cash flows, and will support the profitability within the next couple of years, if we -- even if the market was to correct certainly.

Moving on to Slide 8, let's review the market highlights for the third quarter of 2025. Around the third quarter, 1-year time charters remained firm at elevated levels supported by tight vessel supply and limited availability. This environment encourages charters to secure for [indiscernible] cover early in the season. However, towards the end of the quarter, the freight market softened as concerns over able supply and increased competition among carriers began to weigh on sentiment.

By late September, the Sungai container freight index has declined to its lowest level in nearly 2 years. However, during October and early November, we witnessed the stabilization and even a strong uptick by 20%. The average secondhand price index rose by about 4.4% in the third quarter versus the second quarter supported by limited vessel availability, geopolitical tensions and strong buyer interest.

Meanwhile, newbuilding prices remained stable quarter-over-quarter. With [indiscernible] gradual increase in prices relative to Chinese yards. Idle capacity continued to be practically nonexistent. Also recycling activity remains subdued with only 11 vessels totaling 6,000 TEUs scrapped year-to-date. [indiscernible] prices have dropped slightly to around $425 per lightweight ton. Overall, the global fleet has expanded by a significant 6% year-to-date.

Please turn to Slide 9 for our broader market overview, focusing on the development of 6- to 12-month time charter rates over the past 10 years. The slide illustrates the charter rates across all major containership segments remain significantly elevated compared to the 10-year medium levels. This [indiscernible] and more subcute elsewhere. U.S. growth is projected at 2% in 2025 and 2.1% in 2026, and modest the revision from model forecast reflecting smaller-than-expected effects from tariffs and more favorable financial conditions.

In late October, the Federal Reserve reduced the market range for the [indiscernible] funds rate by 25 basis points, bringing it to 3.75% up to 4%. [indiscernible] has not loved out an additional rate cut [indiscernible] remain on hold as inflation remains too high, while the market schooling. It continues to show mixed signals. The broader outlook remains fragile with downside risks stemming from persistent uncertainty, potential protectionist measures and the ongoing labor market constraints. Among emerging markets, India is forecast to expand by 6.6% in 2025 and 6.2% in 2026, supported by strong domestic investment, resilient apiculture allow and the vibrant services sector.

The ASEAN economy were also expected to post solid growth of around 4.2% in 2025 and 4.1% in 2026, underpinned by healthy regional demand and continued industrial activity. [indiscernible] economic outlook is expected to remain positive but at a decelerating pace. [indiscernible] include a widening gap between industrial supply and weak domestic demand as well as ongoing trade tensions with the United States, including new tariffs and groups, export confirms and restrictions on high-tech goods. As a result, China's growth is projected to moderate to 4.8% in 2025 and 4.4% in 2026, reflecting a gradual slowdown following the front-loaded exports and remaining fiscal support.

Despite these domestic headwinds, the Chinese economy is still being supported by strong excellent performance to regions such as Southeast Asia and India, along with a still resilient manufacturing sector. We analyze global growth data carefully as it affects directly trade volumes as a whole. Specific factors affecting trade, create slight fluctuations around GDP growth.

On containerized trade, estimates demand growth for 2025 to expand by 3.2%, signaling a strong correlation with expected GDP growth. Parent forecasts though point to a dip to 0.7% growth in 2026, and a further decline of 6% in container trade growth in 2027. These expected decline largely reflects the writing of extraordinary routing patterns and temporary distances that boosted volumes in prior year. The influx of capacity recently order will probably, at some point, outpaced demand growth especially in geopolitical disruptions were to suddenly resolved that allows its turn to short-term more efficient groups.

Turning on Slide 11, where you consider total fleet age container support book. The top left chart, the picture containership fleet is relatively young with most vessels under 15 years old and only 12% of the fleet over 20 years old. The top right chart shows the new deliveries as a percentage of the existing fleet, which are projected at 6.9% for 2025, 5.1% for 2026 and 8.3% for 207, with actual fleet growth expected to be slightly lower due to slippage and future demolition activity. The bottom chart further, the order book continues to increase rapidly, reaching approximately 32% of the fleet as of November 2025.

Turning on to Slide 12, we go over the fleet age profile and order book only for 6 in the 1,000 to 3,000 TEU range, which is quite different from the overall picture. As of November 2025, the order book for vessels below 3,000 TEU stands at a modest 8.1% of the fleet. According to Clarksons, deliveries in this size range remain limited with newbuilding additions projected returning 2.1% of the fleet in 2025, followed by 2% in 2026, 3.4% in 2027 and 2.7% in 2028 beyond.

About half of the fleet is over 15 years old making them likely candidates for scrapping when the market corrects.

Let's move to Slide 13 now to see the supply outlook for the 3,000 to 8,000 TEU segment, the other sector in which we currently operate. As of November 2025, the order book stands at 12% of the fleet, a modest level compared to the larger main classes. Meanwhile, the age profile of this segment is notably advanced with 27% of vessels over 20 years old and another 38% between 15 and 19 years. With a limited new building pipeline, net fleet growth in this segment is expected to remain contained if not become negative over the next few years.

Moving on to Slide 14. This chart places those dynamics and perspectives across the entire containership sector. What stands out is the concentration of new building activity in the larger vessel classes. New Panamax and Post-Panamax vessels saw order books representing 40% to nearly 80% of their existing fleet, reflecting the significant capacity being [indiscernible] for the main lane play. By contrast, the feeder and intermediate segments have significantly smaller orders ranging from just 4% to 12%, depending on size even though a substantial portion of these fleets between 20% and 40% or already more than 20 years old. This widening gap between newbuilding activity in the large vessel segment and the limited replacement in smaller segment highlights why our core fleet remains structurally well positioned with minimal risk of oversupply.

Now please turn to Slide 15. Turning to the container sector outlook. Conditions across the container shipping sector remain mix. [indiscernible] continue to hold firm supported in part by Red Sea rerouting, even if the [indiscernible] container ship rate index has steadily declined. Overall, charter rates remain[indiscernible] due to limited near-term supply and steady demand across most societies.

In 2026, U.S. trade policy and broader geopolitical developments will be key drivers of trade volumes and route patterns. Recent tariff agreements raising from 10% to 50% have provided some short-term stability with uncertainty around U.S.-China relations persists. Through 2025 was an epitome of this uncertainty. The U.S. post reason Chinese own control of big ships only for China to reciprocate and then within days, both these fees were put on ice following discussions between Mr. Trump and Mr. [indiscernible] at the end of October.

Additionally, the recent ceasefire between Israel and [indiscernible] Hamas suggest potential easing of disruptions with the Red Sea. The shipping companies are adopting a cautious wait-and-see stance with no immediate [indiscernible] yet. In 2027, and on the back of the increased container ship ordering even for smaller vessels, if demand in terms of a mile doesn't surprise on the upside, the market may enter into a more challenging phase. Regarding energy transition, while it continues to be an important factor in the balance of container trade, the recent nonapproval of the IMO's net 0 framework has inevitably slowed the process substantially. Arguably, the compulsion was overambitious as technical targets and economic curves were [indiscernible] anyway and surmounted. Nevertheless, the process of transitioning to new more environmentally friendly fuels will continue, but hopefully in a more disciplined and realistic manner.

Let's turn to the last slide of this section, Slide 16. The left-hand graph shows the cycle of the 1-year time charter rate for 2,500 TEU container ships over the past 10 years. As of November 14, 2025, the 1-year time charter rate stands at $25,750 per day well above both historical leverages and medium. This robust rate environment is made in asset values as well. New building vessels are now valued at $45 million compared with a 10-year $35 million and an average of roughly $36 million. Likewise, 10 year round second hand versus the currently valued at [indiscernible] million significantly higher than the 10-year median or $14 million at the average of about $20 million. In this environment, owners like us are generally reluctant to buy vessels at today prices, unless this can be combined with charters, which would bring the residual values down to more normalized prices. It is proving though that quite a few charters fearing the potential loss of market share and consequently, market relevance are providing such charters to smaller newbuilding vessels even with 2028 deliveries. Unfortunately, until this stops, we will continue to see the order book swelling, which obviously will eventually result in a lot of capacitating the market.

And with that, I will pass the floor to our CFO, Anastasios Aslidis, to go over our financial highlights in further detail.

Thank you very much, Aristides retires. Good morning from me as well, ladies and gentlemen. Over the next 5 slides, I will give you my usual overview of our financial highlights for the quarter and the 9-month period of 2025 and compare them to the same periods of last year.

For that, let's turn to Slide 18. For the third quarter of 2025, the company reported total net revenues of $56.9 million, representing a 5.1% increase over total net revenues of $54.1 million during the third quarter of last year. On a per vessel per day basis, our vessels earned a 10.7% higher average charter rate in the third quarter of this year compared to last year. We reported a net income for the period of $29.7 million as compared to a net income of $27.6 million for the third quarter of 2024. Total interest and other financing costs for the third quarter of 2025 amounted to $3.7 million compared to $4.2 million for the previous year, a figure of the previous year that does not include imputed interest income of about $0.9 million, which is related to the self-financing of our predelivery payments for our new billing program.

The decrease is due to the lower interest rate we paid in the third quarter of this year compared to last for our debt. Adjusted EBITDA for the third quarter of 2025 increased to $38.8 million compared to $36.1 million achieved during the third quarter of 2024, again, primarily due to the increase in revenue. Basic and diluted earnings per share for the third quarter of 2025 were $4.27 and $4.25, respectively, calculated on about $7 million basic diluted weighted average number of shares outstanding compared to $3.97 and $3.95 basically diluted, respectively, for the same period of last year. The adjusted earnings per share for the quarter -- for the 3-month period ended September 30, 2025, which has been $4.26 and $4.23 basically diluted, respectively, adjusted for unrealized gains on derivatives compared to adjusted earnings of $3.94 basic and $3.92 diluted for the same period of last year.

Let's now look at the numbers for the corresponding 9-month period ended September 30 and convert them. For the first 9 months of 2025, we reported total net revenues of $170.5 million representing a 6.8% increase over total net revenues of $159.6 million that we earned during the first 9 months of last year mainly as a result of the higher number of vessels we owned and operated and higher average earnings that we had.

We reported a net income for the period of $96.5 million as compared to a net income of $88.4 million for the first 9 months of last year. Total interest and other financing costs for the first 9 months of 2025 amounted to $11.7 million, not including $0.1 million of imputed interest income compared to $10.7 million for last year, again, not including in that case, $3.6 million of reputed interest income. This increase is due to the increased amount of debt that we held on average during the respective 9-month period of this year compared to last, partly offset by the lower interest rates we paid.

Adjusted EBITDA for the first 9 months of 2025 was $115.2 million, compared to $102.9 million for the first 9 months of last year, a 12% increase. Basic diluted tenants per share for the first 9 months of this year were $13.90 and $13.84, respectively, calculated again on approximately $7 million, basically diluted weighted average number of shares outstanding compared to basic diluted earnings per share of $12.75 and $12.66 for the first 9 months of 2024, calculated again on approximately the same number of shares, about $7 million. The adjusted earnings per share for the 9-month period ending September 30 of this year would be $12.25 basic and $12.19 diluted compared to $11.57 basic and $11.49 diluted for the same period of 2024.

Let's now turn to Slide 19 to review our fleet performance. I will not go through the utilization rate figures as I did in the previous calls, and they are near 100%, but I will move [indiscernible] discuss the rest of the table. On others, in the third quarter of this year, 22 vessels were owned and operated, earning another time charter equivalent rate of $29,284 per day compared to 23 vessels that we operated in the third quarter of 2024, earning an average of $26,446 per day. Our total daily operating expenses including management fees, G&A expenses, but excluding dry docking costs, were $ 7,246 per vessel per day during the third quarter of this year compared to $7,247 per vessel per day for the same period of 2024.

If we move further down on this table, we can see the cash flow breakeven levels which take into account in addition to the above expenses, the drydocking expenses, interest expenses and loaner payments. Thus, for the third quarter of 2025, our daily cash flow breakeven level was $13,073 per vessel per day compared to $13,629 per vessel per day for the same period of last year.

Below the breakeven line, you can see our dividend distribution expressed in dollars per vessel per day basis. And for the third quarter of this year, it amounted to $2,410 compared to $2,013 for the same period of 2024.

Let's move now to discuss similar figures for the 9-month period, keeping again the discussion on the utilization rates. We can report that we own and operated an average of 22.6 vessels, during the first 9 months of 2025, earning an average time charter equivalent rate of $28,735 per day, compared to 21.3 vessels that we own and operated in the same period of 2024 earning an average, $28,624 per vessel per day. Our operating expenses, again, including management fees and G&A expenses, averaged $7,386 during the first 9 months of 2025, compared to $7,452 per vessel per day for the same period of last year. Again, at the bottom of this table, you can see the breakeven level, the cash flow breakeven level, which includes, as we said, interest expenses, dry docking expenses and loan repayments, excluding Baluch, and that was $13,833 per vessel per day compared to $14,743 for the same period of last year.

And finally, I will not go through the dividend that we paid in the 9 months expressed in dollar per day basis. Let's now turn to Slide 20. We reduced this slide this time around to provide a better perspective of the depth of our contract coverage especially in light of the recent forward charters concluded that Aristides mentioned in the beginning of the presentation. The table zone present the development of our fleet ownership days over the period -- over the next 2 years to 2026 to 2028 at an estimated breakdown of how many days are available for hire and how many days are already contracted. It incorporates assumptions about delivering dates for vessels under construction, scrapping days for older ships, estimate dry docking timing and duration, utilization rate, assumption going forward, we used a quite conservative one of 98% and estimates for contracted dates and average contractor grade.

Please note that the data in this table is only estimates that we use for our modeling purposes for future time charter equivalent revenues and the actual figures will be different. But still, I hope this can provide some appreciation of our revenue and earnings visibility. As Aristides mentioned earlier, our contract coverage currently stands for 75% for 2026, 52% for 2027 and 29% for 2028. Average contracted rates are, respectively, 31,300, 33,500, and 35,500 for each of the 3 years. Here, if one makes an assumption about the average rate that are uncontracted days will learn, one can easily come up with an estimate of our overall revenues for the respective year. I hope this helps our investors and analysts that cover us in their own analysis of our future profitability.

Let's now move to Slide 21 to review our debt profile. As of September 30, 2025, our total outstanding bank debt stood at about $224 million with an average interest rate margin of about 2% which based on a 3-month off rate of 3.87% results in the cost of our debt of about 5.9% which is well within the prevailing gains for our segment and peers.

For the fourth quarter of 2025, we expect loan repayments of approximately $5.4 million with no balloon payments during the remainder of the year, which accordingly, we reduce our year-end balance. In 2026, scheduled loan repayments amount to approximately $19.5 million, again with no volume payments during the year. In 2027, we expect [indiscernible] of about $16.8 million, together with a $20 million balloon payment making total scheduled repayments for 2027 to approximately $36.8 million. Similarly, we can see in the chart, the scheduled payments for the period 2028 to 2030.

At the end of 2030, the remaining outstanding debt, assuming no [indiscernible] financing of our current debt would be about $76 million. This calculation here does not include debt we expect to draw to finance the construction of our 4 new buildings, debt which we estimate to be in the range of $140 million to $150 million.

At the bottom of this slide, as always, we show our cash flow breakeven estimate for the next 12 months, broken down by its key components. On this basis, our total cash flow breakeven level for the next 12 months stands at approximately $12,000 per vessel per day, a level well below the ends of our fleet. In making the comparison, we are the ends of our fleet, one can really appreciate the cash flow generation potential that our vessels provide.

To sum up my presentation here, let's move to Slide 22 to review some highlights from our balance sheet. As of September 30, 2025, cash and other cash -- other current assets in our balance sheet totaled approximately $126.4 million. We have already made $35.9 million of advances for our newbuilding program. And we had also on our asset side, the book value of our vessels including Marcos B, which as [indiscernible] was held for sale, which stood at about $512.5 million, for a total book value of our assets of about $675 million.

On the liability side, as I mentioned in the previous slide, we had debt amounting to $224 million. Other liabilities for about $24 million, resulting in book shareholders' equity of roughly $427 million. However, the market value of our fleet, it's charter -- adjusted market value for our vessels, is significantly higher than their book value. According to our latest estimates, our fleet is valued approximately $680 million, which translates into a net asset value for our company of about $595 million or roughly almost $85 per share. With our last closing price and the recent trading rates of around $60 per share, our stock trades is at almost a 30% discount to its charter adjusted net asset value.

And with that, let me pass the floor back to Aristides to continue our call.

Thank you, Anastasios. Let me open up the floor for any questions we may have. .

[Operator Instructions] Our first question is from Mark Reichman with NOBLE Capital Partners.

There's just really 2 areas I wanted to focus on. The first is -- what are your expectations for the scheduled off-hire days for the fourth quarter and the remainder of 2026. I mean if I look at your slide deck, it seems like that you're anticipating very light dry-docking schedule, at least over the next 12 months. So just a little clarity there would be appreciated.

I think this is correct. We have not many dry dockings over the next 12 months. And the -- our -- likely of high for Q4 as in the previous quarter, almost 0. And for modeling purposes, what I saw on this new slide 20, we use a 2% [indiscernible] in of hire just to model it. But typically, we run our fleet north of 99% utilization rate. .

Okay. So if they were 39 days in the third quarter, do you think that the fourth quarter would be lower than that? If you've got 0 in terms of order.

In terms of scheduled dry docks, I think we don't have any scheduled dry docks in the fourth quarter to the best of my top of my head. We have all signing water surveys. .

Okay. And so surveys. I mean, I think in the third quarter, the number of days came maybe in a little higher than what we were expecting. But we might have just had a special survey built in. But I mean, do you think it would be greater than 5 or 10 days for the fourth quarter?

It's hard to, I would say -- yes. Not even. But in the third quarter, we had a mine that underwent dry docking. We have no scheduled dry docks in the fourth and the next scheduled dry dock will be in the third quarter of next year to the best of my understanding. .

Okay. Tasos. And the second area is so if containership ordering has accelerated even in the smaller sector, which could increase supply, you've mentioned that you think that could pressure rates from 2027 on you're pretty well covered in 2027 with 52% locked in. But I mean if we look at your Slide 9 where you're showing kind of the rates and you can kind of see that the rates are above the average. And then if you take into consideration that the rerouting, if that kind of settles back that you're kind of expecting maybe a the potential for rates to decline into 2027, 2028. But I was just kind of curious, I wanted to focus on that Slide 9, if I could, because I see the averages and the medians, it seems to me median is pretty severe. I mean I would probably look at it by taking the standard deviation of the rates and maybe putting a plus 1, minus 1 standard deviation around the average.

But I mean, you're also looking at a couple kind of a time series here. And so if we're looking at different regime ships. If you were to plant a flag and say 2020, what differences do you see in the market, pre-2020 and maybe the last 10 years versus the next 10 years. I mean, I think you're looking at an aging fleet. You're looking at increasing environmental standards. So obviously, the fleet is going to get replenished. Rates could probably go up based on the newer vessels, efficiencies could go down -- or could go up as you've got more fuel-efficient vessels. So you're -- your costs could come down. But I was just kind of just kind of flesh that out a little bit in terms of your expectations? And are there differences in the overall market? I mean, is it too simplistic to kind of look at this slide from 2015 to 2025 and draw conclusion? Or are there some other factors that may have a bearing on rates going forward.

The main reason why years 2015 to 2020, the markets were very low, as you can see, if we're looking at this decade is that there was a huge order book nearly 100% back in 2007 and 2008 that got delivered. So we had a fee oversupply of vessels which was the reason why charter rates for between 2015 and 2020 were extremely low.

And then of course, we had the pandemic with the consequent significant increase in tonne miles for vessels, which resulted in this huge boom that we witnessed during the pandemic. And then the market started to correct after the pandemic and rates dropped again to a much more reasonable level. And then we had the war between Palestine and Israel, which closed the Suez Canal and resulted in the increase in the market that we have seen. These are the 3 main factors. Of course, there's so many other things that play around that. But these are the 3 main factors where we are -- where we are I don't think that we can see rates again as low as what we see -- we saw between '15 and '20, but we are shipping. But I don't think you can see that also for one additional reason that there has been quite significant inflation resulting in prices of newbuilding ships increasing substantially over the last 5 to 6 years. So if new building ships cannot become much cheaper because the shipyards will be losing money. They place kind of a floor for secondhand values as well. So it's a very difficult equation and it's extremely difficult to predict. That's why ....

But it's not unreasonable to expect that the rates would -- could be higher than, say, your average this average going forward, never told day in the shipping market. So there's probably going to be some volatility. But looking ahead and your breakeven rate is actually pretty -- you have a pretty good cost structure. So I don't know. I just -- just extending this back to 2015 and anyway, that's very helpful. It gives -- it provides a little perspective on the forward numbers.

It gives us a bit of color on what has happened, but to predict what will happen is so much more difficult. Yes.

Another indication Mark of what the market thinks is the charters we just concluded. Obviously, in these were levels we've seen in the market the market believes that the $35,000 per day roughly that we booked our ships for the 4,400 TEU plus is a level that would be okay to lock yourself in for 4 years, 2 years out from now. So that might be an indication that the 54 might be -- I mean, this is a market opinion. I guess, the counterpart opinion willing buyer, willing seller type of thing that might provide some other insights, I guess. .

Our next question is from Tate Sullivan with Maxim Group.

I mean you gave a lot of good descriptions on why you're willing to book your newbuilds well forward. I mean at a longer time line to delivery than most -- almost all your other newbuilds, I think. But can you talk the charters willingness to book the ships that far forward. Have you -- I mean is it to avoid sudden spikes in the market like they had post-COVID? I would love to hear your thoughts on that, please? .

As we said, the fleet of the below 6,000 TEU is a very old fleet, right? 25% is older than 20 years is older than 15 years. We are seeing this aging fleet in the smaller sizes. And the charterers are competing amongst them to have those ships because they know that these ships are needed to trade is increasing continuously. The big ships get full. But then field. But then you need the smaller ships to do the regional trade. So I think we are seeing this potential lack of sales and racing to secure tonnage.

Or do you get any market indications if they're willing to book such long-term contracts that they have dormant vessels that are sitting in ports waiting for voyages at all in the current market?

No, because the current market is a market of full employment, okay? There might be some delays and some waiting times, small waiting times, occasionally due to the various reroutings that are happening. But no, the market is full.

Okay. I mean your news and commentary echoes some recent news in the sector to Tassos remaining newbuild commitments for the new ships, 4 new ships. I think you of your -- what you have already funded. So is your remaining commitment about $200 million -- is that fair?

Yes, correct. I think the contracted prices in total are approximately $240 million. And as I mentioned, we have made payments amounting to about $36 million or so. So roughly $200 million are remaining to be paid.

And then maybe one installment payments every -- one installment payment every year or 2 every year .

I think the next payment is when there is the steel cutting which should be about 12 months roughly before the delivery of the ship. So in middle of next year, we'll start making additional 10% payments. So there would be, I think, there will be 3 more 10% payments before the final payment. .

Our next question is from Clement Molins with Value Investor's Edge.

Most has already been covered, but I wanted to delve a bit into your fleet positioning. You have a clearly dated fleet between legacy and modern tonnage. -- considering you recently fixed for new Wilson order at solid rates. Is there any appetite towards the additional tonnage alongside long-term contracts? Or are you comfortable with your current positioning?

So there is always a possibility to order something. We are looking at various possibilities. I don't know if something will develop or not. But obviously, having secured these last 4 vessels gives us significant safety and comfort to look at potentially doing something more. .

Makes sense. And final question from me. Pro forma for the sale of the Marcus 5 and even when including the CapEx on the new builds, you're sitting in a solid financial position. Is there a medium-term leverage target you plan to meet going forward? Or is it, let's say, a moving target?

[indiscernible]. But generally, our strategy is to have leverage around 50%. And we moved 10%, 15% above or 10% 15% below depending on certain stances and timing in the market. We believe that a decent leverage in a business that is making more than 6%, which is our cost of capital of that, so. it makes sense to have some leverage, if you can earn more than 6%, which is what we believe that historically we do. .

On the other hand, we never want to be too exposed because we know what happens in a bad market, and we've lived through bad markets through our careers. So we don't want to overleverage. So I think that gives you guidance about our general leverage strategy.

Our final question is from Poe Fratt with Alliance Global Partners.

Just do math on the delivery payments I'm calculating in the second half of 2027, you're going to owe about $65 million on the first 2 newbuilds. And then in the first half of '28, you're going to owe about or have to pay about $65 million in -- for the last 2 newbuilds. Is that correct?

That's probably right. I think you should you should think of something like 55% of the contract price to be paid in the year of the delivery in the half year of the delivery. So something like $65 million for the first pair and $ 65 million for the second pair sounds right. .

Yes. That's what I was guessing. And then just a nitpicky one. How did you decide to offer the charter the 1-year option after the fourth year, if you look at the way that the time charters are structured on the 4 new builds, 4 years at 35.5% and then years at 32.5%. It seems like you're giving up a lot on that last year of extra coverage. Can you just talk about that?

I think they were -- we were discussing with charter various options of triclinical ships from 3 years to 5 years, and there were different combinations of rates and durations. And we ended up [indiscernible] that will focus on the 4-year duration of $35, 500, but they ask to have the option to extend or the other -- the 5-year deal. So they have a year to decide about that. That implies a rate of around -- of low 20s for the fifth year if you compare 4 years 35, and 5 years, 22.5%, the implied rate for the fifth year, if you keep the first 4 years and 35.5%, it's around in the low 20s. So we felt that was an appropriate trade-off to make. .

Yes. I had calculated $20,500. And then on your Slide 20, it seems like you're implying that the fleet will -- even with the new builds coming into the fleet will decline in '26 and '27 and '28. Can you just talk about your strategy on selling some of the older assets, mainly the feeders that don't have as much contract cover?

So let me take that. We are taking a very conservative approach that the market may decline significantly. And. We will need to -- instead of passing the special survey of our 2 older vessels, we will decide to scrap them This, of course, is the lowest possible value, but we are being very conservative in our projections. .

And just to get granular, it looks like the and the Jonathan P would be the 2 scrapping candidates if the market does do what you think it is going to do?

One vessels [indiscernible] in our fleet. .

With no further questions, I would like to turn the conference back over to management for closing remarks.

Thank you very much, everybody, for listening in. We will be back to you at the beginning of the year with the full year results. Thank you.

Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your participation.