Pangaea Logistics Solutions Ltd

Previous wording

The Baltic Dry Index (“BDI”), a broader market measure of the cost to transport drybulk commodities by sea, offers a market view into global supply demand trends and is considered the standard benchmark for drybulk cargo pricing. The BDIaveraged 1,871 for the third quarter of 2024, up approximately 43%, compared to an average of 1,305 for the same quarter of 2023. The average published market rates for Supramax and Panamax vessels, reflecting the composition of the company's fleet, also increased approximately 30%, from an average of $10,548 in the third quarter of 2023 to $13,707 in the same period of 2024. As a result of the industry's volatility, we have experienced fluctuations in our quarterly and annual operating results in the past, and we expect to continue experiencing such fluctuations in the future due to various factors, including cargo demand, vessel supply, competition, and seasonality.

Current wording

The Baltic Dry Index (“BDI”), a broader market measure of the cost to transport drybulk commodities by sea, offers a market view into global supply demand trends and is considered the standard benchmark for drybulk cargo pricing. The BDIaveraged 1,118 for the first quarter of 2025, down approximately 39%, compared to an average of 1,824 for the same quarter of 2024. The average published market rates for Panamax, Supramax, and Handysize vessels, reflecting the composition of the company's fleet, also decreased approximately 37%, from an average of $13,671 in the first quarter of 2024 to $8,548 in the same period of 2025.

Previous wording

For the three months ended September 30, 2024, the Company's TCE rates were up 4% to $16,324 from $15,748 for the three months ended September 30, 2023. The Company's achieved TCE rates improved from the previous quarter as the overall dry bulk market rates improved for the three months ended September 30, 2024. The Company's achieved TCE rate for the three months ended September 30, 2024 outperformed the average of the Baltic panamax and supramax market indexes and exceeded the average market rates by approximately 19% due to its long-term contracts of affreightment, ("COAs"), its specialized fleet and its cargo-focused strategy.

Current wording

For the three months ended March 31, 2025, the Company's TCE rates were down 36% to $11,390 from $17,697 for the three months ended March 31, 2024. The Company's achieved TCE rates declined from the previous quarter as the overall dry bulk market rates weakened for the three months ended March 31, 2025. The Company's achieved TCE rate for the three months ended March 31, 2025 outperformed the average of the Baltic panamax, supramax, and handysize market indexes and exceeded the average market rates by approximately 33% due to its long-term contracts of affreightment, ("COAs"), its specialized fleet and its cargo-focused strategy.

Previous wording

•Net income attributable to Pangaea Logistics Solutions Ltd. was approximately $5.1 million for three months ended September 30, 2024 as compared to approximately $18.9 million for the same period of 2023.

Current wording

•Net loss attributable to Pangaea Logistics Solutions Ltd. was approximately $2.0 million for three months ended March 31, 2025 as compared to net income of approximately $11.7 million for the same period of 2024.

Previous wording

•Diluted net income per share was $0.11 for three months ended September 30, 2024, as compared to $0.42 for the same period in 2023.

Current wording

•Net loss per share was $0.03 for three months ended March 31, 2025, as compared to diluted net income per share of $0.25 for the same period in 2024.

Previous wording

•Pangaea's TCE rates were $16,324 for the three months ended September 30, 2024 and $15,748 for the three months ended September 30, 2023.

Current wording

•Pangaea's TCE rates were $11,390 for the three months ended March 31, 2025 and $17,697 for the three months ended March 31, 2024.

Previous wording

•At the end of the quarter, Pangaea had $93.1 million in cash, and cash equivalents.

Current wording

•At the end of the quarter, Pangaea had $63.9 million in cash, and cash equivalents.

Previous wording

Pangaea’s revenues are derived predominately from voyage, time charters, and terminal and stevedore revenue. Total revenue for the three months ended September 30, 2024, was $153.1 million, compared to $135.6 million for the same period in 2023, a 13% increase. The increase in revenues was primarily driven by a 5% rise in total shipping days, reaching 4,805 days for the three months ended September 30, 2024, compared to 4,610 days for the same period in 2023. However, this was partially offset by a 20% decrease in terminal and stevedore revenue.

Current wording

Pangaea’s revenues are derived predominately from voyage, time charters, and terminal and stevedore revenue. Total revenue for the three months ended March 31, 2025, was $122.8 million, compared to $104.7 million for the same period in 2024, an 17% increase. The increase in revenues was primarily driven by a 41% rise in total shipping days, reaching 5,210 days for the three months ended March 31, 2025, compared to 3,685 days for the same period in 2024. However, this was partially offset by a decrease in the market rates for freight and time charters in the first quarter of 2025.

Previous wording

Voyage Revenues: Voyage revenues increased by 13% for the three months ended September 30, 2024 to $145.1 million compared to $127.9 million for the same period in 2023. The increase in voyage revenues was primarily due to a 5% increase in voyage days from 4,314 in the three months ended September 30, 2023 to 4,549 for the three months ended September 30, 2024. The increase is also attributable to higher average TCE rates earned as discussed above.

Current wording

Voyage Revenues: Voyage revenues increased by 26% for the three months ended March 31, 2025 to $109.7 million compared to $87.3 million for the same period in 2024. The increase in voyage revenues was primarily due to a 48% increase in voyage days from 2,830 in the three months ended March 31, 2024 to 4,196 for the three months ended March 31, 2025. The increase is also attributable to the increase in the Company's fleet size as a result of the acquisition of 15 vessels in 2024 from Strategic Shipping, Inc. This was offset by a decline in market freight rates as discussed above.

Previous wording

Charter Revenues: Charter revenues increased to $4.9 million from $3.8 million, or 28%, for the three months ended September 30, 2024 compared to the same period in 2023. The increase in charter revenues was due to higher charter hire rates, with the panamax and supramax vessel index rising 30% from $10,548 per day for three months ended September 30, 2023 to $13,707 per day, over the same period of 2024. However, time charter days decreased by 13% year-over-year, from 296 days to 256 days. Our flexible chartering strategy enables the Company to selectively release excess ship days, if any, into the market under time charter arrangements rather than voyage days.

Current wording

Charter Revenues: Charter revenues decreased to $10.0 million from $15.0 million, or 34%, for the three months ended March 31, 2025 compared to the same period in 2024. The decrease in charter revenues was due to lower charter hire rates, with the panamax, supramax and handysize vessel index declining 37% from $13,671 per day for three months ended March 31, 2024 to $8,548 per day, over the same period of 2025. However, time charter days increased by 19% year-over-year, from 855 days to 1,014 days. Our flexible chartering strategy enables the Company to selectively release excess ship days, if any, into the market under time charter arrangements rather than voyage days.

Previous wording

Terminal & Stevedore Revenues: Terminal & Stevedore revenues decreased by 20% for the three months ended September 30, 2024 to $3.1 million compared to $3.9 million for the same period in 2023. The decrease in revenues was primarily due to the timing of certain significant customer contracts, which did not contribute to revenues in the third quarter of 2024 but are expected to be fulfilled in the fourth quarter of 2024. This timing shift of contracts that contribute materially to port revenues resulted in a decrease for the current period.

Current wording

Terminal & Stevedore Revenues: Terminal & Stevedore revenues increased by 30% for the three months ended March 31, 2025 to $3.1 million compared to $2.4 million for the same period in 2024. The increase in revenues was primarily due to the timing of certain significant customer contracts, which did not contribute to revenues in the first quarter of 2024. This timing shift of contracts that contribute materially to port revenues resulted in an increase for the current period.

Previous wording

In recent years, global cost inflation has contributed to higher vessel operation costs, including crew travel, equipment transportation, and drydocking. While we expect crew payroll expenses to stabilize in the near and medium term, other inflated costs may increase our vessels' daily operating expenses. Typically, any fuel cost increases during voyages are managed through bunker hedging or through fuel cost pass-through arrangements in long-term contracts.

Current wording

In recent years, global cost inflation has contributed to higher vessel operation costs, including crew travel, equipment transportation, and drydocking. While we expect crew payroll expenses to remain stable in the near and medium term, other inflated costs may increase our vessels' daily operating expenses. Typically, any fuel cost increases during voyages are managed through bunker hedging or through fuel cost pass-through arrangements in long-term contracts.

Previous wording

Voyage Expenses: Voyage expenses were $71.5 million for the three months ended September 30, 2024, compared to $59.1 million for the same period in 2023, an increase of approximately 21%. The increase was driven by a 5% increase in voyage days, leading to corresponding increases in bunkers consumed and port expenses incurred. The total average market price of bunkers consumed increased by 19.7% for the three months ended September 30, 2024, compared to the same period in 2023. Port expenses increased approximately 7% compared to the prior year as a result of the increase in voyage day activity.

Current wording

Voyage Expenses: Voyage expenses were $60.3 million for the three months ended March 31, 2025, compared to $37.1 million for the same period in 2024, an increase of approximately 62%. The increase was driven by a 48% increase in voyage days, leading to corresponding increases in bunkers consumed and port expenses incurred.

Previous wording

Charter Hire Expenses: Charter hire expenses for the three months ended September 30, 2024 were $36.5 million, compared to $25.5 million for the same period in 2023, a 43% increase. The increase in charter hire expenses was predominantly driven by higher market rates for charter-in vessels, as well as an increase in chartered-in days. Specifically, the average published market rates for Supramax and Panamax vessels increased approximately 30% climbing from an average of $10,548 in the third quarter of 2023 to $13,707 in the same period of 2024. Chartered-in days increased 7% from 2,358 days in the three months ended September 30, 2023 to 2,519 days for the three months ended September 30, 2024. Charter hire expenses on a per day basis were $14,494 for the three months ended September 30, 2024 and $10,800 for the same period in 2023. The Company's flexible charter-in strategy allows it to supplement its owned fleet with short term chartered-in tonnage at prevailing market prices, when needed, to meet cargo demand.

Current wording

Charter Hire Expenses: Charter hire expenses for the three months ended March 31, 2025 were $17.6 million, compared to $27.1 million for the same period in 2024, a 35% decrease. The decrease in charter hire expenses was predominantly driven by lower market rates for charter-in vessels. Specifically, the average published market rates for Supramax, Panamax and Handysize vessels decreased approximately 37% declining from an average of $13,671 in the first quarter of 2024 to $8,548 in the same period of 2025. Chartered-in days increased 14% from 1,535 days in the three months ended March 31, 2024 to 1,745 days for the three months ended March 31, 2025. Charter hire expenses on a per day basis were $10,108 for the three months ended March 31, 2025 and $17,683 for the same period in 2024. The Company's flexible charter-in strategy allows it to supplement its owned fleet with short term chartered-in tonnage at prevailing market prices, when needed, to meet cargo demand.

Previous wording

Vessel Operating Expenses: Vessel operating expenses for the three months ended September 30, 2024 were $13.9 million, compared to $14.3 million for the same period in 2023, an decrease of approximately 3%. The ownership days remained stable, with 2,293 days for the three months ended September 30, 2024 compared to 2,300 days in 2023, reflecting a decrease of less than 1%. Excluding technical management fees, vessel operating expenses on a per day basis were $5,520 for the three months ended September 30, 2024, down from $5,706 for the three months ended September 30, 2023. Technical management fees amounted to approximately $1.2 million and $1.1 million for the three months ended September 30, 2024 and 2023, respectively.

Current wording

Vessel Operating Expenses: Vessel operating expenses for the three months ended March 31, 2025 were $22.2 million, compared to $12.7 million for the same period in 2024, an increase of approximately 75%. The ownership days increased as a result of the acquisition of vessels in the prior year, with 3,690 days for the three months ended March 31, 2025 compared to 2,184 days in 2024, reflecting an increase of 61%. Excluding technical management fees, vessel operating expenses on a per day basis were $5,528 for the three months ended March 31, 2025, up from $5,300 for the three months ended March 31, 2024. Technical management fees amounted to approximately $1.8 million and $1.1 million for the three months ended March 31, 2025 and 2024, respectively. The increase in technical management fees reflects the expansion of the owned fleet.

Previous wording

General and Administrative Expenses: General and administrative expenses amounted to $6.0 million for the three-month period ended September 30, 2024, compared to $5.5 million for the corresponding period in 2023. The increase is primarily attributable to an increase in non-cash compensation associated with equity awards.

Current wording

General and Administrative Expenses: General and administrative expenses remained consistent, amounting to $7.3 million for the three-month period ended March 31, 2025, and 2024.

Previous wording

The discussion and analysis of the Company’s financial condition and results of operations is based upon the Company’s consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The significant estimates and assumptions of the Company are the estimated future cash flows used in its impairment analysis, the estimated salvage value used in determining depreciation expense, the estimated on the percentage completion of spot voyages and the allowances for doubtful accounts.

Current wording

The discussion and analysis of the Company’s financial condition and results of operations is based upon the Company’s consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the percentage completion of voyages in process, the establishment of the allowance for credit losses, the estimate of salvage value used in determining vessel depreciation expense, and the evaluation of long-lived assets for impairment.

Previous wording

The Company concluded that no triggering event had occurred for the nine months ended September 30, 2024, which would require impairment testing.

Current wording

The Company concluded that no triggering event had occurred during the first quarter of 2025 and 2024, which would require impairment testing.

Previous wording

As of September 30, 2024, and December 31, 2023, the Company’s working capital was $100.3 million and $86.5 million, respectively. This increase mainly reflects strategic refinancing of secured debt and finance leases, which extended maturity dates and improved liquidity over the nine months ending September 30, 2024.

Current wording

As of March 31, 2025, and December 31, 2024, the Company’s working capital was $66.9 million and $82.9 million, respectively.

Previous wording

Net cash used in investing activities during the nine months ended September 30, 2024, was $57.4 million compared to $25.0 million for the same period in 2023. The Company purchased two vessels for $57.5 million in the nine months ended September 30, 2024. In comparison, during the nine months ended September 30, 2023, the Company (i) paid $27.0 million for the purchase of one vessel and other vessel improvements and (ii) paid $7.2 million for the net cash acquisition of a port and terminal operation. These uses of cash were partially offset by $8.0 million in net proceeds from the sale of one vessel and cash dividends of $1.6 million from equity method investments.

Current wording

Net cash used in investing activities during the three months ended March 31, 2025, was $0.5 million compared to $0.2 million for the same period in 2024.

Previous wording

The Company’s capital expenditures relate to the purchase of vessels and interests in vessels, capital improvements to its vessels which are expected to enhance the revenue earning capabilities and safety of these vessels, as well as port & terminal operations. The Company’s owned or partially owned and controlled fleet at September 30, 2024 includes: nine Panamax drybulk carriers (six of which are Ice-Class 1A); nine Supramax drybulk carriers, two Ultramax Ice Class 1C, two Ultramax drybulk carriers, and four Post Panamax Ice Class 1A drybulk vessels.

Current wording

The Company’s capital expenditures relate to the purchase of vessels and interests in vessels, capital improvements to its vessels which are expected to enhance the revenue earning capabilities and safety of these vessels, as well as port & terminal operations. As of March 31, 2025, the Company owned three Panamax, two Ultramax Ice Class 1C, two Ultramax, nine Supramax and four Post-Panamax Ice Class 1A drybulk vessels. The Company owns two-thirds of its consolidated subsidiary Nordic Bulk Holding Company Ltd. (“NBHC”) which owns a fleet of six Panamax Ice Class 1A drybulk vessels. In addition, the Company owns fifteen Handysize vessels acquired through the merger with Strategic Shipping Inc., completed on December 30, 2024. The Company also holds a 50% equity interest in the owner of a deck barge and operates port and terminal facilities in Fort Lauderdale, Florida, and Baltimore, Maryland.

Previous wording

In addition to vessel acquisitions that the Company may undertake in future periods, its other major capital expenditures include funding its program of regularly scheduled drydockings necessary to make improvements to its vessels, as well as to comply with international shipping standards and environmental laws and regulations. Funding expenses associated with these requirements will be met with cash from operations. The Company anticipates that this process of recertification will require it to reposition these vessels from a discharge port to shipyard facilities, which will reduce the Company’s available days and operating days during that period. The Company capitalized drydocking costs totaling approximately $3.0 million in the nine months ended September 30, 2024 and 2023. The Company expensed drydocking costs of approximately $233,000 and $356,000, respectively, in the nine months ended September 30, 2024 and 2023.

Current wording

In addition to vessel acquisitions that the Company may undertake in future periods, its other major capital expenditures include funding its program of regularly scheduled drydockings necessary to make improvements to its vessels, as well as to comply with international shipping standards and environmental laws and regulations. Funding expenses associated with these requirements will be met with cash from operations. The Company anticipates that this process of recertification will require it to reposition these vessels from a discharge port to shipyard facilities, which will reduce the Company’s available days and operating days during that period. The Company capitalized drydocking costs totaling approximately $6.4 million and $1.3 million the three months ended March 31, 2025 and 2024, respectively. The Company expensed drydocking costs of $79,940 and $37,080, respectively, in the three months ended March 31, 2025 and 2024.