Fresh work for Top trio

Top Ships has secured period contracts for three of its vessels after existing charters with Emirates Ship Investment Company (EShips) were cancelled.

In a statement the Greek operator said it will pocket a termination fee to the tune of $500,000.

While the reason for end of the EShips deals was not disclosed, the charterer was recently taken over by Oldendorff and the German bulker owner is unlikely to have had need for the vessels.

Nasdaq-quoted Top has already lined up new fixtures for the 49,700-dwt EShips Taweelah (built 2014) and a pair of newbuildings, the statement said.

Top Ships pointed out that Stena Weco (Stena) chartered all three of the ships for three years at a rate of $16,200 per day in contracts that include two one-year options.

If the options are exercised the company said the Danish operator will pay $17,200 daily for each of the vessels during the first optional year and $18,000 in the second.

Top Ships noted Stena also has an option to take the EShips Taweelah for up to seven years at a rate of $16,800 per day for the first five years, $17,500 for the sixth and $18,200 for the seventh that must be declared by 10 August.

In a note to investors chief executive Evangelos Pistiolis applauded the development as he believes it will improve cash flow visibility, which should, in turn, aid efforts to secure the financing needed fund the owner’s newbuilding programme.

“Our gross contracted revenue, over the firm period of our charters, has increased by 18% to $117m, up from $99m under the previous charters,” he continued, adding:

“Including the option periods of our charters, gross contracted revenue has increased by about 25% to $193m, up from $155 million under the previous charters.

If Stena Weco exercises the option for the five-year contract on EShips Taweelah, gross contracted revenue for the firm period goes up to $130m, an increase of 31% from the previous charters.

If we include the option periods of our charters, gross contracted revenue totals $206m, an increase of about 33% from the previous charters.”

According to the company’s website EShips had chartered the EShips Taweelah and both newbuildings, which are due for delivery in 2015 and 2016, for up to three years.

Today, Top Ships pointed out that each of the vessels would have earned $16,000 per day during the firm period of the failed fixtures and $17,250 a piece if the UAE operator exercised the option to extend the duration of the contracts by another year.

Industry observers note Top Ships made headlines yesterday when it pulled the plug on a Wall Street fundraiser in which it planned to rake in $50m from the sale of new shares, a revelation that fuelled uncertainty about how it would bankroll its orderbook.

Attempts to reach EShips for more detail about why the fixtures with Top Ships collapsed were not immediately successful at the time of writing Wednesday.