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Diana Shipping (DSX) Q2 2019 Earnings Call Transcript

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Diana Shipping (NYSE: DSX)
Q2 2019 Earnings Call
Jul 30, 2019, 9:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Operator

Greetings. Welcome to the Diana Shipping Inc. 2019 second-quarter earnings conference call and webcast. [Operator instructions] Please note, this conference is being recorded.

I would now like to turn the conference over to your host, Mr. Ed Nebb, investor relations. Thank you, you may begin.

Ed Nebb -- Investor Relations

Thank you, Devin, and thanks to all of you for joining us for the Diana Shipping Inc. second-quarter conference call. Members of the management team who are with us today include Mr. Simeon Palios, chairman and chief executive officer; Mr.

Anastasios Margaronis, president; Mr. Andreas Michalopoulos, chief financial officer; Mr. Ioannis Zafirakis, chief strategy officer and secretary; and Ms. Maria Dede, chief accounting officer.

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Before management begins their remarks, let me briefly remind you of the safe harbor notice. Certain statements made during this conference call, which are not historical fact, are forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act. Such forward-looking statements are based on assumptions and beliefs as to future events that may or may not prove to be accurate. And for a description of the risks, uncertainties and other factors that may cause future results to differ from the forward-looking statements, please refer to the company's filings with the SEC.

And now without further delay, let me turn the call over to Mr. Simeon Palios, chairman and CEO.

Simeon Palios -- Chairman and Chief Executive Officer

Thank you, Ed. Good morning, and thank you for joining us today to discuss the results of Diana Shipping Inc. for the second quarter of 2019. Our financial performance during the recent quarter and year to date continue to reflect an increase in our time charter revenues and improved operating profitability before an impairment loss and loss from vessel sales.

We continue to actively manage our fleet profile, announcing agreements to sell several vessels. Significantly, we have returned a substantial amount of capital to our shareholders in the form of multiple self-tender offers. To summarize our financial results, Diana Shipping Inc. reported a net loss of $1.3 million and net loss attributed to common stockholders of $2.7 million for the second quarter of 2019.

These results included a $2.8 million impairment loss and a $2.1 million loss on vessel sales. This compares to a net income of $2 million and net income attributed to common stockholders of $0.5 million reported in the second quarter of 2018. Time charter revenues rose to $55.4 million for the second quarter of 2019 from $53.4 million for the same period of 2019. Increasing time charter revenues was due to increased average time charter rates that the company achieved for its vessels during the quarter, which was partly offset by increased revenues due to the sale of two vessels in December 2018 and three vessels in the first half of 2019.

Turning to the balance sheet, cash, cash equivalents and restricted cash totaled $144.5 million at June 30, 2019. Long-term debt net of deferred financing fees including the current portion was $495 million compared to stockholders equity of approximately $609.4 million. Reflecting our commitment to return value to shareholders, the company recently announced the preliminary results of our latest self-tender offer to purchase up to 2 million shares of our outstanding common stock at a price of $3.75 per share. This was our third such offer this year.

Our two earlier self-tender offers completed in March and May 2019 purchased, in aggregate, approximately 7 million shares. In connection with our active management of the company's fleet, we have announced agreements to sell three vessels since the start of 2019 second quarter, Erato for a sale prices of $7 million before commissions, Artemis for sale price of $6.4 million before commissions. In July, we announced an additional vessel sale, the Nirefs, for a sale price of $6.71 million before commissions. These vessels were build in 2001 and 2004 and were among the oldest vessels in the fleet.

We will continue to monitor our fleet of 43 vessels in a responsible manner that promotes a balance of time charter maturities and produces a predictable revenue stream. We are pleased that the company demonstrated its fundamental financial strength, returned capital to shareholders and continue its prudent fleet management strategy during the past quarter. We will strive to sustain our progress through the remainder of the year and beyond. With that, I will now turn the call over to our president, Anastasios Margaronis, for a perspective on the industry conditions.

He will then be followed by our chief financial officer, Andreas Michalopoulos, who will provide a more detailed financial overview. Thank you.

Anastasios Margaronis -- President

Thank you, Simeon, and welcome to all of the participants in this mid-summer second-quarter presentation of Diana Shipping Inc. Looking at the Baltic Exchange indices as we usually do, between the beginning of the year and July 26, provides us a good picture of the volatility prevailing in the bulk carrier market these days. On January 2nd, the Baltic Dry Index stood at 1,282 and on July 26, it closed at 1,937. The Baltic Panamax Index went from 1,391 to 2,109.

And the Baltic Cape Index that started the year at 1,987 and ended on July 26 at 3,647. Starting with macroeconomic developments. According to the IMF, the world GDP is expected to grow by 3.3% this year and 3.6% in 2020. U.S.

GDP growth was estimated to be 2.3% this year and only 1.9% growth in 2020. Total Central and Eastern European growth is estimated at 0.8% this year and 2.8% next. On the supply side, according to Clarksons, the bulk carrier fleet capacity currently projected to grow by two and a half percent in deadweight terms during 2019. Bulk carrier fleet growth in 2020 is currently projected to remain fairly steady at around 2.4%, potentially allowing for some gradually rebalancing with the effect of the implementation of the IMO 2020, sulfur cap potentially having a positive effect on the market.

On the demand side, global seaborne dry bulk trade is currently projected to expand by only 1.3% this year to reach 5.3 billion tons with the iron ore trade projected to decline by around 3% in ton miles and 2% by volume due to disruption to Brazilian and Australian shipments in the year so far. Looking ahead to 2020. Initial projections suggest that seaborne dry bulk trade volumes to grow by around 2.3% next year, around 3.1% in ton miles, with uncertainty over the growth outlook for a number of commodities. Looking at steel.

According to Commodore Research, during the first five months of this year, world crude steel output excluding China contracted by 0.3%. However, during the same period, crude steel output in China grew by 9.6%. Steel output in the U.S. also jumped by about 8% during the first five months of 2019.

Among the poorest performing major steel producers recently have been Japan and the European Union. European steel production declined by 4% year on year in the first four months of this year. Howe Robinson's report strong steel prices in China due to government orders to cut production in the city of Tangshan in a bid to reduce pollution. Iron ore.

As mentioned earlier, on a global basis imports of iron ore are estimated by Clarksons to drop by 2% this year. Next year, they're expected to grow by 1%. Chinese imports of iron ore during the first five months of this year were down 5% year on year. However, it is worth noting that iron ore stockpiles in Chinese ports fell below a 120 million tons in March for the first time in two and a half years and have kept falling for several weeks since then.

Coking coal. On a worldwide basis, exports of coking coal are expected to increase by 1% this year and by 2% in 2020. It is currently projected by Clarksons that China's seaborne coking coal import will remain fairly steady at around 39 million tons in 2019. On thermal coal, according to Clarksons, overall global seaborne thermal coal trade is projected to expand this year by only 5 million tons as weaker imports into China, South Korea, the European Union are expected to roughly balanced in growth in a range of other developing countries and markets.

In 2020, volumes might increase by 1% to reach 1.013 billion tons. Stockpiles of coal at the port of Tsingtao stood at 5.4 million at the end of June, which was down 19% from a year ago. Similar drops in power plant stockpile were witnessed in June with 17.8 million tons of stockpile, which was 19% down to the same period last year. As regard to grain cargoes now.

Again, Clarkson's report that total imports of grain products are expected to rise this year by 1% and reach 477 million tons. While in 2020, the forecast is for a further 2% increase and volume of 486 million tons. For the first five months of this year, Chinese imports of soybean dropped to 31.5 million tons, down 12% year on year. The drop reflects a continued disruption to the U.S.-China soybean trade as a result of the well-publicized trade war and the slower ramp-up in Brazil of the soybean import during the current harvest than was seen last year.

As regard to earnings, after showing considerable weakness earlier this year, Capesize rates started moving upwards mainly in Brazil and South Africa, especially on routes to Asia. Gains in the Pacific and Transatlantic routes followed at a slower pace. Average 12-month time charter earnings for Capes stand at around $21,500 a day. In April of this year, this rate was around $14,000 per day.

Panamaxes can now be fixed at an average of $15,000 per day. While last April, they could only be fixed at around $9,500 per day. For Kamsarmaxes, rates are about $1,500 per day higher. These rates provide an indication of the turnaround witnessed in the market for large bulk carriers since last spring.

To place into perspective the earnings weakness experienced earlier this area is working out in that -- during the first five months of the year, according to banchero costa, Panamax time charter hire rate averaged only $7,940 per day. This was 28% down compared to the same period in 2018. For Capes during the same period this year, time charter rates averaged about 8,880 per day, which was 34% lower compared to the same period last year. Turning to demolition now.

According to banchero costa, bulk carrier demolition during 2019 is expected to reach 14 million tons deadweight. In 2020, this is expected to grow to 17 million deadweight. In 2021, we project scrapping to jump even higher and reach 19 million deadweight. Clarksons observed that the recycling yard today seems to be happy to wait for rates to fall despite the clear lack of tonnage in the market.

In our view, this might result in panic buying when one of the pack breaks ranks and buys tonnage for recycling. Then out of fear that they might be left without tonnage to scrape, the rest move in and bid prices much higher than they would otherwise be. Latest price levels are in the region of $445 per light displacement ton. According to banchero costa, demolition of Capes and VLOCs is expected to reach 54 units having an aggregate of 9.3 million deadweight from a low of 2.8 million in 2018.

The reasons according to these analysts are disappointing market conditions witnessed earlier this year, the implementation of the Bellas Water and low sulfur regulation as well as scheduled fleet replacement. Even though 22 ships were scrapped during the first five months of this year, we doubt very much that the total figure of 54 mentioned above will be reached if today's market conditions are maintained for the rest of the year. As regard to the new building order book. According to Clarksons, there are 933 bulk carriers on order with a total deadweight of 99.5 million.

This represents 11.2% of the existing fleet. On the Capes, the tonnage on order is 50 million, representing 14.7% of the trading fleet today. As for Panamaxes, the 23.8 million deadweight on order at the equivalence of just 11.2% of the fleet. Let's look at fleet growth now.

According to banchero costa, the fleet of Panamax and post-Panamax vessels grew 3% in 2018. This year, it is estimated to grow by 5%, and in 2020, by 4%. These higher numbers might be the result of low demolitions particularly during 2018. In this size range, 8% of the trading fleet is over 20 years old, the 11% is 15 to 19 years old, while 19% is less than five years old.

Capes in yellow seas grew 4% last year and are expected to grow by 2% this year and by 4% in 2020. This slowdown might be attributed to increased scrapping according to banchero costa. In this size range, 4% of the trading fleet is over 20 years old, 8% between 15 and 19 years old and 20% is less than five years old. I cannot avoid saying a few words about scrubbers now that the implementation date of IMO 2020 low-sulfur fuel is just around the corner.

According to Gibson, from 2,779 Panamaxes trading today that number includes Kamsarmaxes, only 118 vessel have either fitted scrubbers or are planning to do so. This is just 4% by number. As for Capes, of the 1,274 vessels trading, about 129 vessels have either have scrubbers fitted or are planning to fit them later this year. This is about 10% by numbers.

These numbers are not expected to change dramatically when new buildings are taken into consideration. So all in all, we're led to the conclusion that there will be plentiful supply of low-sulfur fuel available around the world from January next year onwards. In order to avoid free growing commerce [Inaudible]. This development should eventually lead to reduction in the price differential between high- and low-sulfur fuel.

Turning to the outlook for our industry. Gibson Shipbrokers see more available cargoes and less available tonnage in the near term. The great unknown is as usual commodity demand. Looking at China, all the coal demand has fallen.

Demand for iron ore has remained stable. Chinese mills have been buying iron ore from stockpiles where prices have been cheaper in quant terms, and these stocks will need to be replenished. According to Gibsons, there are enough positive factors that play to justify a positive outlook as we're moving to the second half of this year and more importantly, further improvements are expected in 2020. According to Commodore Research, iron ore export prospectus are very promising for the rest of the year.

Brazilian and Australian iron ore exports are expected to increase. While at the same time, Chinese steel output is expected to remain robust and China's iron ore port stockpiles have continued to plummet. So generally speaking, shipping analysts are as confident about future trends in the bulk area market as they have been for a while now. We agree with these forecast, but need to remind ourselves that there are various unknowns out there, which might ruin in this rosy picture that most analysts are presenting for the bulk carrier market.

Tension in the Middle East and the by now infamous trade war, which will have to be resolved soon would escalate in further improving and affect demand for shipping transportation of raw material. As we have mentioned on several occasions in the past, Diana Shipping's management intend to continue with the sales of older tonnage in the fleet and apply the proceeds in the best possible way to enhance shareholder value and strengthen even further the company's balance sheet. Now we pass the call to our CFO, Andreas Michalopoulos, who will present the financial highlights for the second quarter and the first half of this year. Thank you.

Andreas Michalopoulos -- Chief Financial Officer

Thank you, Stasi, and good morning. I'm pleased to be discussing today with you Diana's operational results for the second quarter and six months ended June 30, 2019. Net loss and net loss attributed to common stockholders amounted to $1.3 million and $2.7 million, respectively, including $2.8 million of impairment. Loss to common shares was $0.03.

Time charter revenues increased to $55.4 million compared to $53.4 million in the second quarter of 2018. The increase was due to the increased averaged time charter rate that we achieved for our vessels during the quarter and was partly offset mainly by a decrease in revenues due to the sale of two vessels in December 2018 and three vessels in the first half of 2019. Ownership days were 4,179 in the second quarter of 2019 compared to 4,550 in the same quarter of 2018. Fleet utilization was 98.4% compared to 97.9% for the same quarter of 2018.

And the daily time charter equivalent rate was $12,717 compared to $11,773 for the same quarter of 2018. Voyage expenses were $3 million for the quarter compared to $0.8 million for the same quarter of 2018. The increase in voyage expenses was due to the gain in bunkers of $2.1 million in the second quarter of 2018, which did not exist in 2019 -- in the 2019 quarter. Vessel operating expenses amounted to $22.9 million compared to $24.6 million for the second quarter of 2018 and decreased by 7%.

The decrease was due to the 8% decrease in ownership days, resulting from the sale of vessels and was partly offset by increases in fuel costs, insurances and operating costs. Daily operating expenses were $5,478 for the second quarter of 2019 compared to $5,398 for the same quarter of 2018, representing an increase of 1%. Depreciation and amortization of deferred charges amounted to $12.3 million. General and administrative expenses were $6.1 million compared to $6.7 million for the same quarter last year.

The decrease was mainly due to internal factors for prior-year bonuses due to the changing legislation. The decrease was partly offset by increased payroll cost due to increased number of employee. Management fees to related party were $0.5 million compared to $0.6 million for the same quarter last year. The decrease was due to the decrease in average number -- in the average number of managed vessels.

Interest and finance costs amounted to $7.8 million compared to $7.3 million in the same quarter of 2018. This increase was attributable to increased interest -- due to increased interest rates partly offset by decreased average debt compared to the same quarter of 2018. Interest and other income amounted to $0.8 million compared to $1.1 million for the same quarter last year. The decrease was due to the repayment of the loan by Performance Shipping.

For the six months ended June 30, 2019, net income amounted to $1.7 million and net loss attributed to common stockholders amounted to $1.2 million, including $7.5 million of impairments. Loss per share was $0.01. Time charter revenues increased to $115.7 million compared to $101.8 million for the six months ended June 30, 2018. This increase was attributable to increased average time charter rates that we achieved through our vessels during the period offset by decreased revenues due to the sale of five vessels.

Ownership days for the first half of 2019 were 8,499 compared to 9,050 last year. Fleet utilization was 99% compared to 98.9% during the same period of 2018. And the daily time charter equivalent rate was $13,092 compared to $11,097 for the first half of 2018. Voyage expenses were $5.7 million.

Vessel operating expenses amounted to $45.3 million compared to $47.5 million for the same period last year. The decrease in operating expenses was due to the decrease in the fleet and was partly offset by increased insurances of spares, repairs and operating expenses. Daily operating expenses in 2019 were $5,324 compared to $5,248 for 2018, representing a 1% increase. Depreciation and amortization of deferred charges amounted to $24.7 million.

General and administrative expenses decreased to $13.6 million compared to $13.7 million for the same period of 2018, mainly due to this impacted and was partly offset by increased payroll cost and traveling expenses. Management fees to related party were $1 million compared to $1.2 million in 2018 due to the decrease in number of managed vessels by DWA. Interest and finance costs amounted to $15.5 million compared to $14.3 million last year. This increase was attributable to increase in average interest rate compared to last year, while average debt decreased.

Interest and other income amounted to $1.5 million compared to $2.5 million for the same period last year. This decrease was due to the repayment of the loan by Performance Shipping. Thank you for your attention. We will be pleased now to respond to your questions, and I will turn the call to the operator who will instruct you as to the procedure for asking questions.

Thanks.

Questions & Answers:


Operator

[Operator instructions] Our first question comes from the line of Amit Mehrotra with Deutsche Bank. Please proceed with your question.

Amit Mehrotra -- Deutsche Bank -- Analyst

Thanks, operator. Good afternoon to everyone on the Diana Shipping team. Ioannis, I wanted to start with you if I could, you and the team have a good way of assessing the sentiment, the psychology of the dry bulk shipping market. I think you look at the asset values relative to maybe what you'd be willing to pay for them in the context of the 1-year time charter rate.

Can you just talk about where those dots are, in red or green territory? And maybe what current -- what that tells you, I guess, about the current values of dry bulk ships? And where you think the next move is, either up or down? Thank you.

Ioannis Zafirakis -- Chief Strategy Officer and Secretary

The rates are -- Hi, this is Ioannis. The question that you have posed is very interesting one. Because we are at the point where we are seeing the rates going up and the values of the vessels not following in the same pace. Again, the sentiment looks as if people are prepared to pay less money based on the existing charter rates and the vessels' demand today.

In other words, we read that as people being cautiously optimistic, which is a very good thing for our industry because we're not -- we have not started destroying the market. In other words, we still believe that the fear meter is on the high side. People are still very skeptical as regards the trade war and the various problems existing in the dry bulk sector, like the Vale issue, etc. And if you look at this from a distance, this is a good thing because certainly, the demand has some problems as regards the future.

But at the same time, the supply of vessels has been kept in a very, very manageable level. And this is why we still believe that we're going to see much better rates till the end of the year, beginning of the next year. From the moment everybody starts believe in what we are saying then problems are going to be happening. It's always like this, when people do not believe us, things go the way we want and when they start believing us, then the opposite happens.

You understand the reason?

Amit Mehrotra -- Deutsche Bank -- Analyst

Yes. No. I learned my lesson, I think, back in 2013.

Ioannis Zafirakis -- Chief Strategy Officer and Secretary

Yes, Yes.

Amit Mehrotra -- Deutsche Bank -- Analyst

Just related to that, so I think maybe a good summary of what you said is, you would maybe expect the fundamental underlying earnings power of the vessels, the rates of the vessels to improve over the next six to nine months, and depending on various variables, hopefully the asset values will follow suit, is that kind of a fair assessment of what you just said?

Ioannis Zafirakis -- Chief Strategy Officer and Secretary

Certainly, certainly. If people suddenly realize that there is a lack of vessels or demand is higher than what they should have expected, then everybody is going to be doing the wrong things to destroy the market. We're going to have ordering. We're going to be having vessels going on the spot always there to charter the next charter, etc.

And slowly, it takes time, the market is going to deteriorate. And especially, if we do not have other sectors in our industry being on the same pace, then that would happen faster. If we are lucky enough to have a thriving tanker market or a container market at the same time, it's going to take longer for the market to go down.

Amit Mehrotra -- Deutsche Bank -- Analyst

Right, OK. Thank you very much for that. And then one follow-up question, I guess, maybe for Andreas with respect to the cash deployment strategy. I mean the company has chosen the strategy of tender offers, which I think makes a lot of sense in terms of controlling the technical pressure, either up or down on the stock, based on your own capital deployment strategy.

I believe the tenders have been basically prefunded with proceeds from asset sales. I just wanted to understand, is that the strategy going forward, i.e., have -- continue to buyback shares as long as they continue to be well below NAV, but do in the way that's effectively net debt neutral as you continue to renew the fleet? And then maybe, Andreas, talk about also your plans to renew the fleet and continue to do so as well?

Andreas Michalopoulos -- Chief Financial Officer

You summarized very well what we have in mind. Indeed, as long as -- first of all, as you know, we have quite a few vessels that are unencumbered and are candidates to be sold. This is for the shipping part and in order to renew the fleet. So those vessels are going to be sold in a scattered manner.

As you know, we do things in a scattered manner in order to be able to get a good average on our sales. And this is what we have started to do. Now, the proceeds of those vessels, as long as our share price is below NAV, as you very well pointed out, the best way to play the arbitrage that exist or the dislocation that exists between the share price in the market and the NAV is to tender offer and to buy back the shares with the exact amount of the proceeds of the sales. This is why in terms of cash, we don't intend to diminish the cash on the balance sheet, which we wanted to remain at about $140 million to $150 million in cash and to increase it going forward.

Now this strategy will remain as long as: one, the share price is at the level it is; two, we won't go too far because we still want to have a nice float and liquidity in the market. But having said that, if the share price goes back to normal levels than we will stop that and we will deploy our strategy that is a different one.

Amit Mehrotra -- Deutsche Bank -- Analyst

Great. One quick one for me just, if I could, just remind us, Andreas, what the high watermark is for you guys on the loan to value, because the way you're doing it now there's actually no change to the leverage profile of the company, which makes a lot of sense. But right now by our estimates, it's maybe around 45% to 50% of the gross asset value of the company.

Andreas Michalopoulos -- Chief Financial Officer

Yes.

Amit Mehrotra -- Deutsche Bank -- Analyst

First -- yeah, go ahead.

Andreas Michalopoulos -- Chief Financial Officer

Yes, You are right. Loan to value is around 42% actually. Having said that, I want to say that we have repaid one loan at the beginning of the year. So the proceeds can also be used on an absolute basis to diminish the leverage.

And the example of that is at the beginning of January 2019, where we paid the loan for motor vessel Maera in full. So it's a combination of what we said and what we're doing with the tender offers and what I've just said now.

Amit Mehrotra -- Deutsche Bank -- Analyst

Yes. But you don't want to go above the 50%, is that correct? As you renew the fleet going forward.

Andreas Michalopoulos -- Chief Financial Officer

At this stage, it's all the question of where you are in the market. As Ioannis said, our views is that the market is going to go up. As long as you go -- as the market goes up, the goal is to deleverage the fleet and to arrive at a very manageable level, lower than 40% at the peak of the market. If the market was to suddenly turn and go down, then the strategy would change, and we'll be -- another strategy, then what we do changes and we lever up and we apply vessels different tactics.

Amit Mehrotra -- Deutsche Bank -- Analyst

Right.

Simeon Palios -- Chairman and Chief Executive Officer

Don't forget, Amit that there is the -- also the amortization of the debt anyway. So the debt level is decreasing anyway. Probably you will have the vessels values going up. But we want to make clear to everybody that when we sell a vessel and we immediately invest in our own stock at a big discount to NAV is as if we immediately without taking an extra risk on anything, we are improving the shareholder position.

This is pure mathematics. You understand that there is an outflow money that comes in immediately as a better percentage and the dilutive percentage for the existing shareholders. And we do not understand why other companies, they are not doing the same. I can understand why they're not doing it.

First of all, they don't have the means, they don't have the necessary balance sheet to do that. And secondly, they're wasting their time -- their money on scrubbers.

Amit Mehrotra -- Deutsche Bank -- Analyst

OK. I'm going to let somebody ask that question. But thank you for taking my question guys. I appreciate it.

Operator

Our next question comes from the line of Randy Giveans with Jefferies. Please proceed with your question.

Randy Giveans -- Jefferies -- Analyst

Howdy, gentlemen. How you doing?

Andreas Michalopoulos -- Chief Financial Officer

Very well. Thanks Randy.

Randy Giveans -- Jefferies -- Analyst

Good. Yeah, a quick question, I guess, following up on these comments. Following that most recent tender, what is the current share count? And also, I think you mentioned that it makes sense to use the cash proceeds from the vessel sales to buy stock at a steep discount, using your words, of NAV. So the most recent tender was $3.75 per share, give me a ballpark for what you're saying your steep discount to NAV is?

Andreas Michalopoulos -- Chief Financial Officer

So listen, the discount to NAV, we don't comment on. What I can tell you is that the share count, which is going to be after the tender offer, 96,749,965 shares, that's for your model. It's going to help you. But In terms of discount to NAV, I think you are very good at calculating that.

And certainly, we never comment on the NAV.

Simeon Palios -- Chairman and Chief Executive Officer

Since November 2018, we have decreased the number of shares by 10.4%. There was an increase for restricted sales issued. The total effect is 12.2%, and the net effect is 10.4%. This is very substantial.

We have repurchased $44 million worth of shares since November 2018. And we will continue doing that. Don't forget also that by having less shares and your stock price being closer to $3.5 rather than $4.5, I'm saying just a number here. You understand that we will continue doing that.

Randy Giveans -- Jefferies -- Analyst

Yeah. And I applaud the share repurchases in that regard. All right, I just wanted to take a stab at your -- if you could give me some NAV guidance. Secondly, let's move on to your most recently Capesize charter, the Boston was signed last month for about two years in duration at $15,308.

How much have the one or two-year Capesize time charter rates improved as result of the recent spot rate rally we've seen this summer?

Simeon Palios -- Chairman and Chief Executive Officer

I think, Stasi, you have the number that...

Anastasios Margaronis -- President

Yes, the numbers has been oscillating. If to give you an idea, only about a week ago, we had five TC Index on spot over $30,000 a day. And now we are back down to below $28,000. So on a time-charter basis, now of course, the movements have not been so abrupt, but I would say that the movements has been, on average, depending on where the delivery of the ship, Atlantic or Pacific, gone up by about 15%.

Randy Giveans -- Jefferies -- Analyst

OK. So one year, maybe $18,000, $19,000 and two year, maybe $1,000 less than that?

Anastasios Margaronis -- President

Yes, $18,000, $19,000 if delivery is Pacific, about $22,000 if delivery is the Atlantean, a bit more difficult to get that, and you correctly said, a bit less than two years.

Randy Giveans -- Jefferies -- Analyst

Excellent. All right, I will -- that covers it for me. Thank you for the time.

Ed Nebb -- Investor Relations

Thanks, Randy.

Anastasios Margaronis -- President

Thank you.

Operator

[Operator instructions] Our next question comes from the line of Jon Chappell with Evercore. Please proceed with your question.

Jon Chappell -- Evercore ISI -- Analyst

Yeah. Good afternoon, guys. I just have one follow-up from the tender question. Andreas, you mentioned in your answer to one of the prior questions that you still have several unencumbered ships and if I look at your fleet, I think there's one 2001-built left and a handful of fours, fives and sixes.

Can you tell us how many ships remain unencumbered? And maybe even put a range around the asset value of those as we think about the potential to continue the tender going forward?

Andreas Michalopoulos -- Chief Financial Officer

The asset value because there are many, I'm going to list them and the asset value you will go find it. It's kind of easy. So there are 13 ships unencumbered. So Oceanis, Thetis, Protess, Calipso, Clio, Boston, Salt Lake City, [Inaudible], Norfork and Maera.

And these, there's also the Nirefs, but I didn't mention is in the 13 that I said.

Simeon Palios -- Chairman and Chief Executive Officer

Nirefs has gone.

Andreas Michalopoulos -- Chief Financial Officer

And Thetis has gone as well.

Jon Chappell -- Evercore ISI -- Analyst

What was the one after Thetis, the only one I missed.

Andreas Michalopoulos -- Chief Financial Officer

Protess, P R O T E S S. So the older vessels are going to go from those. if you understand, I mean, first we try, but they're quite a few.

Simeon Palios -- Chairman and Chief Executive Officer

The fact of the matter is we are not in a hurry. We have to follow what the market is doing and because we are looking at opportunity, I can say close to $150 million.

Jon Chappell -- Evercore ISI -- Analyst

That's a lot. So then let me ask another follow-up then to another comment Andreas made. You mentioned wanting to keep the proper a liquidity or float. $150 million that could buy back half of your market cap right now, essentially.

So what are you kind of gauging to be the appropriate float? And why wouldn't you just continue to execute this. I mean i really think it's an underappreciated part of your recent strategy. It's closing in orbit, it's quite obvious.

Simeon Palios -- Chairman and Chief Executive Officer

Before Andreas answers, can I intervene and say that it is by no means certain that we will be selling $150 million worth of ships and buying back the company shares. Because we mentioned repeatedly that we need a descent discount to net asset value to engage in such an activity.

Andreas Michalopoulos -- Chief Financial Officer

And we do not plan to do that once. Find someone to sell it kind between offer to buy back $150 million shares. But still the -- as necessary liquidity, Jonathan, is relevant. We still have some major shareholders that they are trusting us since -- I can say, since 2005, they are with us or even a bit later, but still they are with us because they understand completely what we are doing.

And there are the others that they have a different profile. At the end of the day, to cut the long story short, we are not in a position to say what the absolute best liquidity, the best number of shares sold every day is going to be. But certainly, this is something that we are considering all the time. And we are not there to miss the opportunity to sell vessels and buy back the stock.

But on the other hand, we are a publicly listed company, and we have to remain such. Don't forget that we use the capital markets to implement the strategy that has done so well up to now. And the best -- the most possible scenario that is going to happen is after few more tender offers, we are going to end up in a better market. We going to end up in a situation where we are trading above NAV.

And from the moment we do that, dividends is going to be the name of the game, with the sales proceeds.

Jon Chappell -- Evercore ISI -- Analyst

Can't wait. All right. Thank you for your answers.

Andreas Michalopoulos -- Chief Financial Officer

Welcome.

Operator

As there are no further questions left in the queue, I would like to turn the call back over to management for any closing remarks.

Simeon Palios -- Chairman and Chief Executive Officer

Thank you, again, for your interest in and support of Diana Shipping Inc. We look forward to speak with you in the future. Thank you.

Operator

[Operator signoff]

Duration: 49 minutes

Call participants:

Ed Nebb -- Investor Relations

Simeon Palios -- Chairman and Chief Executive Officer

Anastasios Margaronis -- President

Andreas Michalopoulos -- Chief Financial Officer

Amit Mehrotra -- Deutsche Bank -- Analyst

Ioannis Zafirakis -- Chief Strategy Officer and Secretary

Randy Giveans -- Jefferies -- Analyst

Jon Chappell -- Evercore ISI -- Analyst

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