Diana Shipping (DSX) Q1 2020 Earnings Call Transcript

Diana Shipping (DSX 0.52%)
Q1 2020 Earnings Call
May 14, 2020, 9:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Greetings, and welcome to the Diana Shipping Incorporated 2020 first-quarter conference call. [Operator instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Ed Nebb, investor relations advisor.

Thank you, sir. Please go ahead.

Ed Nebb -- Investor Relations

Thank you, Donna, and thanks to all of you for joining us for the Diana Shipping Inc. 2020 first-quarter conference call. The members of the management team who are with us today include Ms. Semiramis Paliou, acting chief executive officer and chief operating officer; Mr.

Anastasios Margaronis, president; Mr. Ioannis Zafirakis, interim chief financial officer, chief strategy officer, treasurer and secretary; and Ms. Maria Dede, chief accounting officer. Before management begins, let me briefly summarize the safe harbor notice.

Certain statements made during this call, which are not historical fact, are forward-looking statements under the safe harbor provisions of the private Securities Litigation Reform Act, and such forward-looking statements are based on assumptions, expectations, projections or beliefs as to future events that may not prove to be accurate for description of the risks, uncertainties and other factors that may cause results to differ from the forward-looking statements. Please refer to the company's filings with the SEC. And with that, let me turn the call over to Ms. Paliou.

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Thank you, Ed. Good morning, and thank you for joining us today to discuss the results of Diana Shipping Inc. for the first quarter of 2020. I am addressing you today in my capacity as acting chief executive officer.

I also bring greetings from our Chairman and CEO Simeon Palios. He asked me to tell you that he looks forward to joining us on future calls. As individuals, businesses and governments around the world continue to deal with the challenges of the pandemic, the near-term outlook for the dry bulk shipping sector is uncertain. What is certain, however, is that Diana Shipping Inc.

has successfully navigated previous difficult economic cycles. We are confident in our strategies and our ability to emerge from this period as a strong shareholder-focused company. To summarize the results of the 2020 first quarter, the company's financial performance primarily reflected lower time charter revenues and impairment loss on vessels values, a loss from the sale of a vessel and higher expenses related to the economic impact of the COVID-19 pandemic. Nonetheless, we continued our strategic approach to managing our fleet, announcing an agreement to sell an older vessel.

And we have once again returned capital to our shareholders in the form of a self-tender offer early in the quarter and share repurchases under our share repurchase plan. With respect to our financial results for the first quarter of 2020, Diana Shipping reported a net loss of USD 102.8 million and a net loss attributed to common stockholders of USD 104.3 million, including a USD 93.1 million impairment loss. This compares to net income of USD 3.0 million and net income attributed to common stockholders of USD 1.5 million in the first quarter of 2019, including a USD 4.8 million impairment loss. Loss per share for the first quarter of 2020 was USD 1.21, compared to earnings per share of USD 0.02 for the same period in 2019.

Adjusted loss per share, excluding impairment loss, was USD 0.13 for the recent quarter, compared to adjusted earnings per share of $0.07 for the same quarter of 2019. Time charter revenues were USD 43.8 million for the first quarter of 2020, compared to USD 60.3 million for the same period of 2019. This was primarily due to decreased average time charter rates, as well as the sale of one vessel in the first quarter of 2020 and six vessels in 2019. Turning to the balance sheet.

Cash and cash equivalents, including restricted cash, totaled USD 111.2 million at March 31, 2020. Long-term debt, including the current portion, was USD 465.4 million, while stockholders' equity was USD 457.7 million. Consistent with our commitments to return value to shareholders, the company completed a new self-tender offer to purchase 3,030,303 shares on February 3, 2020. Additionally, during March, the company repurchased 1,088,034 shares under the company's share repurchase plan.

Continuing our active management of the company's fleet, we completed the sale of the 2002-built vessel, Norfolk, in February for a sale price of USD 8.75 million before commissions. We will continue to manage our fleet in a responsible manner that promotes a balance of time charter maturities and produces a predictable revenue stream. As we look ahead of 2020, we will continue the prudent management of our financial position and our fleet and will maintain our focus on delivering value to our shareholders. With that, I will now turn the call over to our president, Stasi Margaronis for a perspective on industry conditions.

He will then be followed by our interim chief financial officer, chief strategy officer, treasurer, and secretary Ioannis Zafirakis who will provide a more detailed financial overlook. Thank you.

Stasi Margaronis -- President

Thank you, Semiramis, and welcome to all who have made the effort to participate in this conference call in spite of the prevailing difficulties created by the current pandemic. The dry bulk market started the year with rather promising prospects. Unfortunately, the rapid expansion of COVID-19 has certainly created havoc in commerce and the dry bulk trade was no exception. The Baltic Dry Index, which started the year at 976, closed yesterday at 398.

The Baltic Panamax Index stood at 1,003 on January 3, and closed yesterday at 628. The Baltic Cape Index was at 1,646 at the beginning of the year, and closed on May 13 at minus 17. We will look at these two types of vessels, the Panamaxes and Capes and their current, as well as prospective earnings later on in this short presentation. Starting as usual with some macroeconomic developments.

It's worth noting that the IMF has cut its 2020 global GDP growth figures down to minus 3% contraction for the year versus 3.3% growth in its latest sets of forecasts. In 2021, growth is expected to rebound to 5.8%, which is 2.4% higher than it previously predicted. Unfortunately, according always to the IMF, this rebound will not bring global output quite back to its pre-COVID-19 levels. According to the IMF, GDP growth in the Eurozone during the first quarter was a negative 3.8% quarter on quarter.

For this year as a whole, Europe is expected to contract by around 7.5%. In the United States, second-quarter contraction is expected to be 10%. For the year, the IMF expects the U.S. economy to contract by as much as 6.1%.

About three weeks ago, China reported that its GDP declined by 6.8% year on year during the first quarter of this year, marking the first official quarterly contraction in almost half a century. In March, Chinese fixed asset investments in both infrastructure and manufacturing fell between 21% and 25% year on year. Clarksons reported that in China, manufacturing PMI rebounded from February's 35.7 to 52 in March, which was a welcome sign of stabilization in the country's huge manufacturing base. Analysts, China International Capital have lowered their expectations for Chinese GDP growth for 2020 from 6.1% to 2.6%.

For 2021, GDP growth has been revised upwards by 3.4% to 9.2%. The IMF highlighted COVID-19's effects on commodity prices. In these predictions, demand for dry bulk goods is forecast to fare better than that for other commodities such as oil and gas. For example, iron ore prices are expected to take a 10% hit on average as a result of the current pandemic, while thermal coal prices might grow by around 8%, which is far less than other energy goods.

Meanwhile, prices for agri bulks are predicted to be the most resilient. Soybean prices are expected to take a 5% hit, while the effect on wheat and coarse grain products is expected to be negligent. Turning to demand now. According to Clarksons, the dry bulk trade is expected to contract by 3.7% this year, mainly as a result of the COVID-19 virus pandemic.

The same analysts expect demand to grow by 5.3% in 2021 and reach 29.762 billion tonnes. As for iron ore, again, according to Clarksons, total seaborne trade of iron ore is expected to be flat this year at around 1.456 billion tonnes, while next year, the forecast is for growth of about 2%. Because of weakening steel demand this year, iron ore imports across a range of importers from Europe to Japan and South Korea are now expected to come under downward pressure. However, Clarksons point out that with China gradually getting back to work, there is some potential for a gradual improvement of seaborne iron ore trade with lower prices and stockpiling efforts boosting imports into China.

Chinese iron ore imports are currently projected to grow by 2% this year to just over 1 billion tonnes. On steam coal, according to Clarksons again, steam coal seaborne trade is expected to shrink by 5% this year and grow by 2% in 2021. A steeper decline this year cannot be ruled out completely. So far in 2020, Chinese seaborne steam coal imports appear to have held up fairly well, in part reflecting disruption to local coal production.

Unfortunately, Clarksons point out that it now appears likely that imports will come under pressure in the coming months with domestic coal production back to near-normal levels. European steam coal imports are initially projected to fall by almost 20% this year, which will be the third consecutive year of sharp declines. Coal shipments into India could come under pressure from weaker demand and an abundance of domestic supply. A piece of good news on the China-U.S.

trade prospects was that China announced it was dropping 27% tariffs on U.S. Forage in coal from March 2. Some ships already loaded with coal on that date sailing in the Pacific were rerouted into Chinese ports for discharge. Coking coal now.

Clarksons report that COVID-19 pandemic is expected to severely impact steel industry worldwide. As a result, global seaborne coking coal trade is projected to decline by 7%, compared to 2019 and lie at 253 million tonnes during the year. Imports into Europe, Japan and South Korea are likely to come under significant downward pressure in the short term as a result of reduced steel demand, primarily in the car production and construction industries. Total seaborne exports are expected to increase by 5% in 2021.

Chinese coking coal imports could remain stable this year compared to 2019 as landborne imports from Mongolia have been significantly disrupted during the first two quarters, while gradually resuming economic and industrial activity during the remaining two quarters of the year might support demand if it materializes. Grain cargoes. On a worldwide basis, seaborne grain trade is expected to increase by 2% this season and reach 485 million tonnes. In 2021, a further increase of 3% is expected to bring a total volume to about 500 million tonnes.

As usual, the soybean trade will play a crucial role on how projections on the grain trade will evolve. Chinese buyers are expected to increase purchases of U.S. soybeans later this year as part of commitments made in the Phase 1 of the U.S.-China trade deal. Global seaborne soybean trade is projected to grow by 2% to around 150 million tonnes in 2020.

According to Howe Robinson, soybean shipments from Brazil benefited from a good crop and low local currency. Shipments rose 14% year on year to 18 million tonnes in the first quarter of 2020 with almost 74% of those volumes going to China. Chinese soybean and seaborne imports from around the world are projected to increase and reach just over 92 million tonnes during this coming grain season, an increase of 5% year on year. Turning to scrapping.

According to banchero costa, during the first three months of 2020, 37 bulk carrier units, or 4.9 million tonnes deadweight, of all sizes were sold for scrap. Clarksons report that after a firm start to the year, bulker recycling effectively came to a halt in late March and early April. This was due to the lockdowns across the Indian subcontinent. These lockdowns have made deliveries of ships to breakers nearly impossible.

At the end of April, limited workforce was allowed to start working at the Indian demolition facility. Clarksons predict that this does not mean that the market has suddenly reopened. There could be a positive sign for things to come if the pandemic does not worsen over the next few weeks. Again, according to Clarksons, total bulker scrapping is now projected to reach 15.2 million deadweight during 2020.

If this materializes, it will be 92% higher than last year. According to Clarksons, the weak outlook for the bulker market together with the significant macroeconomic uncertainty has severely limited bulker contracting activity so far this year with only 1.6 million deadweight worth of bulk carrier tonnage ordered during the first quarter of this year, a drop of 76% compared to the same period last year. As for the new building order book, according to Clarksons, for bulk carriers as a whole, at the end of March this year, there were orders for 75.7 million deadweight worth of tonnage. This represented 9% of the current fleet.

Clarksons also reported that there were 19.2 million deadweight worth of Panamax vessels on order, representing about 9% of the existing fleet. From this total tonnage, about 11.3 million are scheduled to be delivered this year and 6.8 million next year. There is little doubt that several of the 2020 deliveries will be pushed back or fall back by necessity into 2021. As regard to Capesize vessels, a total of 39.3 million deadweight worth of ships were on order as of the end of March this year, from which 20.4 million deadweight are scheduled for delivery this year and 15.4 million deadweight in 2021.

This tonnage on order represents about 11.1% of the trading fleet. It is interesting, though, to note that as regard for additional Capes from 120,000 to 190,000 deadweight, the order book represents a mere 3.6% in deadweight terms of the trading fleet. So obviously, the order book is concentrated in the larger sized Capes up to 220,000 deadweight. Here, the order book represents 28.5% of the trading fleet.

The same point made on slippage from 2020 to 2021 for Panamax deliveries mentioned earlier holds good for contracts of this type of vessels. Let's turn to supply and net fleet growth. According to Clarksons, on the supply side, growth of all types of bulkers is expected to remain limited at about 2.5% this year with a small order book and delivery delays expected to increase. In 2021, the fleet is expected to grow by approximately 1.9%.

With demand expected to shrink by 3.7% this year, as mentioned earlier, and increased by just over 5% next year, there is a potential for a meaningful improvement next year in the dry bulk trade. According to banchero costa, net fleet growth for ships over 120,000 deadweight is expected to remain at around 4% year on year in 2020 after expanding by 4% again in 2019. This expansion is expected to slow down to 3% in 2021. Traditional Capes are expected to shrink in numbers and volume this year by about 1%.

Growth will come from the 190,000 to 220,000 deadweight vessels where the fleet is expected to expand by 16% year on year in 2020. As for Panamaxes and post-Panamaxes, the same analysts foresee in 2020 the delivery of 11.8 million deadweight, even after accounting for slippage. This category includes ships from 65,000 deadweight to 120,000 deadweight. Panamax fleet growth is expected to be 4% this year and 2% in 2021.

A quick look at bunker prices. It is interesting to have a quick look at these as of the end of April this year. In Rotterdam, the heavy sulfer fuel oil, 380-cSt, was trading at around $111 per tonne with very low sulfur fuel selling at $146 per tonne, a difference of about $53 per tonne. In Singapore, the corresponding prices were $164 per tonne and $216 per tonne for very low sulfur fuel, a difference of $52 per tonne.

Opinions vary as to the future trend of this price differential. The proponents of the -- by now, much talked about scrubbers, believe that the price difference will increase together with the price of fuel oil. The rest of us believe that with the supply of very low sulfur fuel oil increasing and its availability becoming more abundant, the price difference going forward might very well be reduced even further. This price differential is material to owners who have decided to install scrubbers onboard their vessels at significant costs to purchase, to fit, as well as lost earnings during the fitting period.

Finally, let's have a look at the outlook for our industry. It has always been very difficult to make any credible statements as regards the outlook of the dry bulk trade. Now with the effects of the pandemic on worldwide trade, it is particularly practically impossible to do so as the variables have increased even more. For example, now Commodore Research predicts that going forward, weakness in much of the global economy is likely to persist.

China continues to fare relatively well. And Chinese iron ore inputs are expected to remain reasonably strong. It is also encouraging that according to Commodore Research, China appears likely to significantly increase its grain imports from the United States. Then we turn to Braemar, who claims that there is much uncertainty for the future of the shipping market and the world economy as a whole as a result of the latest pandemic.

There will certainly be a recovery at some stage, but what appears to be clearer by the day is that this is not going to happen over the short term. The forecast of a global recovery in 2021 rests heavily on the pandemic easing in the second half of this year and on the success of policy actions to prevent bankruptcies, sustain job losses and systemwide financial strain. It is not until the world comes together to find a long-term solution for COVID-19 that we will begin to see any signs of a sustained recovery. This is the unenviable business environment we have to face in the dry bulk sector of the shipping industry.

Once again, our strong balance sheet will help provide us with options as regards our business strategy going forward. Among these options are the sale of old tonnage and active management of our capital structure. Investment in younger tonnage and reinstatement of the dividend to our shareholders would probably follow in due course when prevailing conditions make this an attractive proposition. I will now pass the call to our Interim Chief Financial Officer Ioannis Zafirakis who will provide us with the financial highlights of the first quarter of this year.

Thank you.

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Hello. Good morning to everyone. I'm very pleased to be discussing today with you Diana's operational results for the three months ended March 31, 2020. From my new position as an Interim CFO of this company, I think I'm getting very old for this, but never mind.

So during this quarter, we recorded a net loss attributed to common stockholders of USD 104.3 million or USD 1.21 per common share. However, this result included the $93.1 million of impairment loss on vessels values, which is equal to USD 1.8 for -- per share, which means that the per share loss adjusted for impairment was, if I can say, only $0.13 per share. As you are aware, during 2019, we sold six of our vessels and another one in the first quarter of 2020, which, of course, decreased the ownership days this quarter to 3,801, compared to 4,320 for the same quarter of 2019. Of course, we had less ownership days.

The less ownership days together with the deteriorated market conditions led to lower revenues of $43.8 million, compared to the $60.3 million in the first quarter of 2019. Another reason for the decrease in the revenues was fleet utilization, which was 96.4%, compared to 99.7% for the same quarter of 2019. And you can understand that this is mainly due to COVID-19-related issues. The daily time charter equivalent rate that we achieved during the specific quarter was $11,377, compared to $13,453 for the same quarter of 2019.

In addition to the above, we had an increase in the voyage expenses and they were $3.7 million for the quarter, compared to $2.8 million for the same quarter of 2019. And that increase in voyage expenses was due to loss from bankers that -- amounting to $1.3 million, compared to $0.4 million gain that we had the same period the last year. During this discussed quarter, our vessel operating expenses amounted to $21.3 million, compared to $22.4 million. Although this total number of operating expenses was lower than the previous year's quarter, daily operating expenses were a bit higher at $5,608, compared to $5,175 for the same quarter of 2019.

Our general and administrative expenses were increased to $9.5 million, compared to $7.5 million for the same quarter last year, resulting from the resignation of two board members whose shares had to be vested in the first quarter of 2020. A good news for this quarter was the interest and finance costs, which amounted to $6.4 million, compared to $7.7 million in the same quarter of 2019. This decrease was attributable to the decreased interest -- due to the decreased interest rates and, of course, decreased average debt compared to the same quarter of 2019. We thank you for your attention.

And now we are pleased to respond to your questions, and we will turn the call to the operator, who will instruct you as to the procedure for asking questions.

Questions & Answers:

Operator

Thank you. [Operator instructions] Our first question is coming from Omar Nokta of Clarksons. Please go ahead.

Omar Nokta -- Clarksons Platou Securities, Inc.

Thank you. Hello, everyone. And hi, Semiramis, it's good to speak to you, and looking forward to speaking again with Mr. Palios.

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Thank you, Omar.

Omar Nokta -- Clarksons Platou Securities, Inc.

Yeah. So just wanted to -- you've obviously -- you and the team have given us a sobering overview of the dry bulk market and the broader economic backdrop. The writedown on the ships today, it's not a surprise given the extreme weakness that we've been seeing in charter rates and the pressure on ship values. And apologies if you already addressed this in your opening remarks, but I wanted to just get a sense of how many of the 41 ships you own does that impairment apply to? And was it vessel class specific? Was it age? Just some color on that would be helpful.

Thank you.

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Hi, Omar. This is Ioannis. We had nine of our vessels that we had to take impairment. And I cannot say that it is class specific.

We had some Capesizes and some Panamaxes that we did that. You understand that the environment is different. You know how the test is done. You have to take assumptions as regards future revenues, together with increased values -- with increased operating expenses, you come up with a number that force you to take impairment and bring the value of the vessel closer to the actual value of the ship rather than the book value.

Impairment is not a bad thing. It gives a clearer picture, I think, to everyone. And from the moment we have to take it, we take it.

Omar Nokta -- Clarksons Platou Securities, Inc.

Yeah. And I think I know the answer, but any minimum net worth covenant thresholds that have been changed as a result?

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

No. The answer is no.

Omar Nokta -- Clarksons Platou Securities, Inc.

Yeah, good to hear.

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Don't forget also that most of the terms in the loans refer to actual values rather than book, but there are some on book. But they are higher than the market value.

Omar Nokta -- Clarksons Platou Securities, Inc.

Yeah. And Ioannis, as Interim CFO, according to the 20-F, it looks like debt repayments are pretty manageable for this year. I think it was around maybe $48 million to $50 million, if I recall, and maturities in next year were maybe about $140 million -- or repayments were $140 million. As you think about refinancing and looking at the capital structure, of the $48 million, call it, for this year, the $140 million for next year, how much of these payments do you see being able to defer just by virtue of refinancing balloon payments?

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Thank you for that question. We are about to issue a press release tomorrow talking about some of these facilities. So you know us very well to know that we are proactive in that respect. And we will certainly be in a position to conclude something soon.

Omar Nokta -- Clarksons Platou Securities, Inc.

OK, all right. I'll look forward to that. And maybe just one more, if you don't mind. Just wanted to think about the cash.

Obviously, in a nice cash position, excluding the restricted cash, you have $90 million. When we think about just the cash coming in, in the second quarter, I know the Norfolk you had sold for the $8.75 million. Are those proceeds already in the balance sheet? Or is that coming in the second quarter?

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

No, they are already in the balance sheet, the proceeds.

Omar Nokta -- Clarksons Platou Securities, Inc.

OK. All right, well, that's it for me. Thank you.

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Thank you, Omar.

Operator

[Operator instructions] Our next question is coming from Randy Giveans of Jefferies. Please go ahead.

Randy Giveans -- Jefferies -- Analyst

Howdy, Semiramis, Stasi and Ioannis? How's it going?

Stasi Margaronis -- President

Hi, Randy.

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Hi, Randy.

Randy Giveans -- Jefferies -- Analyst

Here we are, hopefully, yeah. Hey, hey, hopefully, Simeon's doing better. And Ioannis, congrats on the new role here.

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Yeah, thank you very much.

Randy Giveans -- Jefferies -- Analyst

All right. Well, yeah, so last quarter, we saw the sales of Calipso and Norfolk both get canceled. The Norfolk has since been sold. But just trying to get a sense for your plans for the Calipso, maybe some of your older vessels in the near term.

Are vessel sales even an option kind of in this environment? And will the proceeds be used for share buybacks or just further kind of debt delevering?

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Again, you know us very well. Certainly, we have not given up the thought of selling the older tonnage and the mortgage vessels, and this is something that we are considering. As regards the proceeds from that sale, you know very well that today, as we speak, the main name of the game for ourselves is defense. And therefore, most probable scenario is that we will keep the money aside from the sales.

However, having said that, we should not exclude the extreme situation where the values of our stock is -- the value of our stock is very, very depressed and we may do some repurchases. Having said that, you understand that we have taken the position that we are in a very -- we are in an uncharted territory. And we should not investing large -- we should not be investing large amounts of money on anything and be ready for -- in case the scenario is the worst one expected.

Randy Giveans -- Jefferies -- Analyst

Sure. That's understandable. Now you mentioned kind of uncharted territory. Clearly, the first half of 2020 has been weak.

But we've seen some weak periods before, the first half of 2016, even the first half of last year with the crude damp here and stuff. How does this year kind of compared to those periods? And do you expect a rebound in the coming months?

Stasi Margaronis -- President

I know that others, they have found valid argument to try to persuade themselves and the others that the market may return in the second half of 2020. But we are in the opinion that it is the first time that we see drop in the demand due to many of world economies having a problem. It's not as if we have one or two economies that they are having a problem, we are talking about almost the entire world. Too many parts of the chain have been broken and, therefore, I don't think that anyone should be in a position to be talking about speedy recovery because you understand that everything depends on too many countries.

Now I know that a lot of money are going to be spent as stimulus packages around the world. And certainly it depends on what type of stimulus packages and where the money are going to be spent. And there is a good scenario where this money are spent in infrastructure and things that we carry raw materials for, but I don't think that anyone should take that scenario as being the most probable one.

Randy Giveans -- Jefferies -- Analyst

OK. And kind of with those sentiments, how are you kind of preparing for that in terms of either short-term chartering, three, six, nine months, versus the longer-term 12, 18, 24 months?

Stasi Margaronis -- President

No, we keep our hedging strategy. We secure some long term and some short term. What we don't want to do is have a lot of vessels opening at the same time and not end up in a period where everything is really bad and have a lot of vessels opening. So you should be expecting the company to do the same thing that we were doing the last 15 years.

And you have to understand that when you have a hedging strategy, you do not amend based on what's happening around you. Otherwise, it's not a hedging strategy. We have too many safety valves and one safety valve is not to take the position that the market is going to be better after six months and, therefore, go short term now. This is not what we're going to do.

Randy Giveans -- Jefferies -- Analyst

Yeah, that's it. That's it for me. Good chatting, and we'll talk soon. Take care.

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Thank you, Randy.

Operator

Thank you. At this time, I would like to turn the floor back over to management for closing comments.

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Thank you again for your interest in and support of Diana Shipping. We look forward to speaking with you in the year -- future ahead. Thank you.

Operator

[Operator signoff]

Duration: 39 minutes

Call participants:

Ed Nebb -- Investor Relations

Semiramis Paliou -- Chief Executive Officer and Chief Operating Officer

Stasi Margaronis -- President

Ioannis Zafirakis -- Interim Chief Financial Officer, Chief Strategy Officer, Treasurer, and Secretary

Omar Nokta -- Clarksons Platou Securities, Inc.

Randy Giveans -- Jefferies -- Analyst

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