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Financial Instruments and Fair Value Disclosures | 6 Months Ended
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Jun. 30, 2023
Financial Instruments and Fair Value Disclosures |
Financial Instruments and Fair Value Disclosures | 11. Financial Instruments and Fair Value Disclosures Interest rate risk and concentration of credit risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of cash and trade accounts receivable. The ability and willingness of each of the Company’s counterparties to perform their obligations under a contract depend upon a number of factors that are beyond the Company’s control and may include, among other things, general economic conditions, the state of the capital markets, the condition of the shipping industry and charter hire rates. The Company’s credit risk with financial institutions is limited as it has temporary cash investments, consisting mostly of deposits, placed with various qualified financial institutions and performs periodic evaluations of the relative credit standing of those financial institutions. The Company limits its credit risk with accounts receivable by performing ongoing credit evaluations of its customers’ financial condition and by receiving payments of hire in advance. The Company, generally, does not require collateral for its accounts receivable and does not have any agreements to mitigate credit risk. During the six months ended June 30, 2023 and 2022, charterers that individually accounted for 10 % or more of the Company’s time charter revenues were as follows: For the six months ended June 30, Charterer 2023 2022 Cargill International SA 16% 18% Koch Shipping PTE LTD. Singapore * 15% *Less than 10% The Company is exposed to interest rate fluctuations associated with its variable rate borrowings. On July 6, 2023, the company entered into an interest rate swap with DNB (Notes 5 and 12) to manage part of such exposure. Fair value of assets and liabilities The carrying values of financial assets reflected in the accompanying consolidated balance sheet approximate their respective fair values due to the short-term nature of these financial instruments. The fair value of long-term bank loans with variable interest rates approximates the recorded values, generally due to their variable interest rates. Fair value measurements disclosed As of June 30, 2023, the Bond having a fixed interest rate and a carrying value of $ 119,100 (Note 5) had a fair value of $ 117,760 determined through the Level 1 input of the fair value hierarchy as defined in FASB guidance for Fair Value Measurements. Other Fair value measurements Description (in thousands of US Dollars) December 31, 2022 Quoted Prices in Active Markets (Level 1) Non-recurring fair value measurements Long-lived assets held for use (1) $ 67,909 $ 67,909 Total non-recurring fair value measurements 67,909 67,909 June 30, 2023 Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Non-recurring fair value measurements Equity method investments (2) $ 4,519 $ $ 4,519 Long-lived assets held for use (3) 7,809 7,809 Total non-recurring fair value measurements $ 12,328 $ 7,809 $ 4,519 During the fourth quarter of 2022, the Company took delivery of eight vessels under its master agreement with Sea Trade, acquired for the purchase price of $ 263,719 , of which $ 195,810 was paid in cash and $ 67,909 was paid through newly issued common stock (Note 3). The fair value of the common shares issued to Sea Trade was determined based on the closing price of the Company’s shares on the date of delivery of each vessel, which was also the date of issuance of such shares. (2) On April 28, 2023, the Company estimated that the fair value of its 25 % interest in Bergen was $ 4,519 , determined through the Level 2 inputs of the fair value hierarchy, as defined in FASB guidance for Fair Value Measurements, and recorded a gain of $ 844 , being the difference between the fair value of the retained noncontrolling interest plus the carrying value the liabilities assumed by Bergen and the carrying value of the assets derecognized (Note 2(e)). (3) On January 30, 2023. the Company took delivery of one vessel under its master agreement with Sea Trade, acquired for the purchase price of $ 31,764 of which $ 23,955 was paid in cash and $ 7,809 was paid through newly issued common stock (Note 3). The fair value of the common shares issued to Sea Trade was determined based on the closing price of the Company’s shares on the date of delivery of each vessel, which was also the date of issuance of such shares.

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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