* Star Bulk Q2 adj EPS $0.04 vs est loss $0.07/shr - Thomson
* Euroseas Q2 adj EPS $0.02 vs est loss $0.01/shr - Thomson
* Euroseas may buy cheap assets
* Star Bulk shares up 5 pct before the bell
By Krishna N Das
BANGALORE, Aug 10 Dry cargo shippers Star Bulk
Carriers and Euroseas Ltd surprised Wall
Street with quarterly profits on lower costs, and indicated they
were on course to manage debt payments despite a weak market.
Most shipping companies have suffered in the past two years
as demand to transport commodities has lagged supply of vessels.
This has been compounded by a slowdown in the global economy
that has made access to funds difficult.
This fundamental weaknesses will likely drive continual cash
flow erosion and covenant pressure within the dry bulk shippers,
brokerage Wells Fargo said recently.
But Greece-based Star Bulk and Euroseas beg to differ.
"Star Bulk is a financially sound company with a healthy
balance sheet that allows us to successfully manage our debt
payments, focus on our growth strategy and reward shareholders,
once more with a quarterly dividend," Star Bulk CEO Spyros
"Our current compliance with all covenants under our loan
facilities supports our financial health."
Star Bulk posted an April-June profit of 4 cents a share,
compared with analysts' projection of 7 cents loss, according to
Thomson Reuters I/B/E/S.
General and administrative costs fell 12 percent.
"As of today, our outstanding debt amounts to $257 million
with our principal repayment commitments for 2011 reduced
substantially compared to last year ....," Star Bulk CFO George
Peer Euroseas posted a profit of 2 cents, compared with an
estimated loss of 1 cent a share.
Aside of a 14 percent decline in general and administrative
costs, Euroseas also gained from its presence in the healthier
"As of June 30, ... our scheduled debt repayments over the
next 12 months amounted to about $13.7 million, a number low
enough to provide us with significant operational cash flow
comfort. All our debt covenants were satisfied as of June 30,
2011." Euroseas CFO Tasos Aslidis said.
CEO Aristides Pittas believes the company's strong balance
sheet presents itself with a chance to buy cheap assets.
"We have been also reviewing opportunities in the drybulk
sector, in which we expect the weakness in rates to translate
into lower vessel prices," Pittas said.
Star Bulk shares were up 5 percent at $1.46 in trading
before the bell on Wednesday. They had closed at $1.39 on
Tuesday on Nasdaq. Euroseas shares were unchanged from Tuesday's
close of $3.54 on Nasdaq.
(Reporting by Krishna N Das in Bangalore; Editing by)