XML 24 R18.htm IDEA: XBRL DOCUMENT v3.23.3
Financial Instruments and Fair Value Disclosures
 6 Months Ended
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.