SB Safe Bulkers Inc

8)

The charter agreement grants the charterer the option to extend the period time charter for an additional 10 to 14 months period at a gross daily charter rate of $9,900.

9)

The charter agreement grants the charterer the option to extend the period time charter for an additional 11 to 14 months period at a gross daily charter rate of $10,000.

10)

The charter agreement grants the charterer the option to extend the period time charter for an additional 12 to 16 months period at a gross daily charter rate of $12,500.

11)

The charter agreement grants the charterer the option to extend the period time charter for an additional 12 to 16 months period at a gross daily charter rate of $12,500.

12)

A period time charter of ten years at a gross daily charter rate of $23,100 for the first two and a half years and of $24,810 for the remaining period. In January 2017, the period time charter was amended to reflect substitution of the initial charterer with its subsidiary guaranteed by the initial charterer and changes in payment terms; all other charter terms remained unchanged.  The charter agreement grants the charterer an option to purchase the vessel at any time beginning at the end of the seventh year of the charter, at a price of $39 million less a 1.00% commission, decreasing thereafter on a pro-rated basis by $1.5 million per year.  The Company holds a right of first refusal to buy back the vessel in the event that the charterer exercises its option to purchase the vessel and subsequently offers to sell such vessel to a third party. The charter agreement also grants the charterer the option to extend the period time charter for an additional twelve months at a time at a gross daily charter rate of $26,330, less 1.25% total commissions, which option may be exercised by the charterer a maximum of two times.

The contracted employment of fleet ownership days as of May 12, 2017 was:

Order book, capital expenditure requirements and liquidity as of May 12, 2017

The remaining order book of the Company consisted of one newbuild vessel, Hull No. 1552 , which is scheduled to be delivered in 2018.

The Company’s remaining capital expenditure requirements amounted to $31.9 million, consisting of $4.6 million payable in 2017 and $27.3 million payable in 2018.

We have agreed to finance Hull No. 1552 by issuing $16.9 million of preferred equity of one of our wholly-owned subsidiaries to an unaffiliated investor in 2018.

We had liquidity of $92.8 million, consisting of $80.6 million in cash and bank time deposits and $12.2 million in restricted cash, in addition to $16.9 million of preferred equity financing and the capacity to borrow against one unencumbered vessel.

Dividend Policy

The Board of Directors of the Company has not declared a dividend on the Company’s common stock for the first quarter of 2017. The Company had 101,503,155 shares of common stock issued and outstanding as of May 12, 2017.

The declaration and payment of dividends, if any, will always be subject to the discretion of the Board of Directors of the Company. The timing and amount of any dividends declared will depend on, among other things: (i) the Company’s earnings, financial condition and cash requirements and available sources of liquidity; (ii) decisions in relation to the Company’s growth and leverage strategies; (iii) provisions of Marshall Islands and Liberian law governing the payment of dividends; (iv) restrictive covenants in the Company’s existing and future debt instruments; and (v) global economic and financial conditions.

Management Commentary

Dr. Loukas Barmparis, President of the Company, commented: ‘‘Our net revenues increased by 35% reflecting the improved market conditions during the first quarter of 2017, resulting in a substantial decrease of our net loss compared to the same period last year. As our liquidity position has improved, we completed an exchange offer in April for approximately $27.7 million in face value of our 8% Series B Preferred Shares, reducing our future financial obligations with respect to preferred dividend payments.’’

Conference Call

On Friday, May 19, 2017 at 9:00 A.M. Eastern Time, the Company’s management team will host a conference call to discuss the Company’s financial results.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (866) 819-7111 (US Toll Free Dial In), 0(800) 953-0329 (UK Toll Free Dial In) or +44 (0)1452-542-301 (Standard International Dial In). Please quote “Safe Bulkers” to the operator.

A telephonic replay of the conference call will be available until May 26, 2017 by dialing 1 (866) 247-4222 (US Toll Free Dial In), 0(800) 953-1533 (UK Toll Free Dial In) or +44 (0)1452 550-000 (Standard International Dial In). Access Code: 1859591#

Slides and Audio Webcast

There will also be a live, and then archived, webcast of the conference call, available through the Company’s website ( www.safebulkers.com ). Participants in the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

Management Discussion of First Quarter 2017 Results

Net loss for the first quarter of 2017 decreased to $3.3 million compared to net loss of $17.8 million during the same period in 2016, mainly due to the following factors:

Net revenues: Net revenues increased by 35% to $33.3 million for the first quarter of 2017, compared to $24.7 million for the same period in 2016, mainly due to an increase in charter rates and to a lesser extent an increase in the average number of vessels. The Company operated 37.82 vessels on average during the first quarter of 2017, earning a TCE ⁶ rate of $9,417, compared to 36.36 vessels and a TCE rate of $6,355 during the same period in 2016.

Voyage expenses: Voyage expenses decreased to $1.5 million for the first quarter of 2017 compared to $3.8 million for the same period in 2016, mainly due to a decrease in vessel repositioning expenses as a result of improved market conditions.

Vessel operating expenses: Vessel operating expenses remained stable at $12.2 million for the first quarter of 2017, compared to $12.1 million for the same period in 2016, while the average number of vessels increased by 4% to 37.82 vessels, from 36.36 vessels respectively. Vessel operating expenses for the first quarter of 2017 and 2016 include the cost of two dry dockings, one of which was partially expensed in December 2016, compared to one during the same period in 2016.

Loss on sale of assets: Loss on sale of assets amounted to $0.1 million for the first quarter of 2017, compared to a loss of $2.75 million for the same period in 2016, as a result of the sale of the Hull No. 1551 and the sales of the vessels Kypros Unity and Stalo, respectively.

Depreciation: Depreciation increased to $12.6 million for the first quarter of 2017, compared to $11.9 million for the same period in 2016, as a result of the increase in the average number of vessels operated by the Company during the first quarter of 2017.

Loss/Gain on derivatives: Gain on derivatives was $ 0.1 million in the first quarter of 2017, compared to a loss of $1.0 million for the same period in 2016 , as a result of the mark-to-market valuation of the Company’s interest rate swap transactions that we employ to manage the risk and interest rate exposure of our loan and credit facilities. These swaps economically hedge part of the interest rate exposure of the Company’s aggregate loans outstanding. The average remaining period of our swap contracts was 0.9 years as of March 31, 2017.  The valuation of these interest rate swap transactions at the end of each quarter is affected by the prevailing interest rates at that time.

Interest expenses : Interest expense increased to $5.7 million for the first quarter of 2017 compared to $4.8 million for the same period in 2016, as a result of the increase in the weighted average interest rate of our loans and credit facilities.

Daily vessel operating expenses ⁷ : Daily vessel operating expenses reduced by 2% to $3,596 for the first quarter of 2017 compared to $3,653 for the same period in 2016.  

Daily general and administrative expenses ⁷ : Daily general and administrative expenses, which include management fees payable to our Managers ⁸ and daily costs incurred in relation to our operation as a public company, were reduced by 4% to $1,156 for the first quarter of 2017, compared to $1,201 for the same period in 2016.

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⁶ Time charter equivalent rate, or TCE rate, represent the Company’s charter revenues less commissions and voyage expenses during a period divided by the number of our available days during such period.

⁷ See Table 2.

⁸   Safety Management Overseas S.A. and Safe Bulkers Management Limited, each of which is a related party that is referred to in this press release as “our Manager” and collectively “our Managers’’.

EBITDA, Adjusted EBITDA, Adjusted Net loss and Adjusted loss per share are not recognized measurements under US GAAP.

-

EBITDA represents Net income/(loss) before interest, income tax expense, depreciation and amortization.

-

Adjusted EBITDA represents EBITDA before loss on sale of assets, gain/(loss) on derivatives and gain/(loss) on foreign currency.

-

Adjusted Net loss represents Net loss before loss on sale of assets, gain/(loss) on derivatives and gain/(loss) on foreign currency.

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Adjusted loss per share represent Adjusted Net loss less preferred dividend divided by the weighted average number of shares.

EBITDA, Adjusted EBITDA, Adjusted Net loss and Adjusted loss per share are used as supplemental financial measures by management and external users of financial statements, such as investors, to assess our financial and operating performance. The Company believes that these non-GAAP financial measures assist our management and investors by increasing the comparability of our performance from period to period. The Company believes that including these supplemental financial measures assists our management and investors in (i) understanding and analyzing the results of our operating and business performance, (ii) selecting between investing in us and other investment alternatives and (iii) monitoring our financial and operational performance in assessing whether to continue investing in us.

The Company believes that EBITDA, Adjusted EBITDA, Adjusted Net loss and Adjusted loss per share are useful in evaluating the Company’s operating performance from period to period because the calculation of EBITDA generally eliminates the effects of financings, income taxes and the accounting effects of capital expenditures and acquisitions, the calculation of Adjusted EBITDA generally further eliminates the effects from loss on sale of assets, gain/(loss) on derivatives and gain/(loss) on foreign currency, items which may vary for different companies for reasons unrelated to overall operating performance. Furthermore, the calculation of Adjusted Net loss generally eliminates the effects of loss on sale of assets, gain/(loss) on derivatives and gain/(loss) on foreign currency, items which may vary for different companies for reasons unrelated to overall operating performance.

EBITDA, Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted Earnings/(loss) per share have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of the Company’s results as reported under US GAAP. EBITDA,  Adjusted EBITDA, Adjusted Net Loss  should not be considered as substitutes for net income and other operations data prepared in accordance with US GAAP or as a measure of profitability. While EBITDA and Adjusted EBITDA Adjusted Net income/(loss) and Adjusted Earnings/(loss) per share, are frequently used as measures of operating results and performance, they are not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation.

In evaluating Adjusted EBITDA, Adjusted Net income/(loss) and Adjusted Earnings/(loss) per share, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA, Adjusted Net Loss  and Adjusted Loss per share  should not be construed as an inference that our future results will be unaffected by the excluded items.

(1)

Ownership days represents the aggregate number of days in a period during which each vessel in our fleet has been owned by us.

(2)

Available days represents the total number of days in a period during which each vessel in our fleet was in our possession, net of off-hire days associated with scheduled maintenance, which includes major repairs, drydockings, vessel upgrades or special or intermediate surveys.

(3)

Operating days represents the number of our available days in a period less the aggregate number of days that our vessels are off-hire due to any reason, excluding scheduled maintenance.

(4)

Fleet utilization is calculated by dividing the number of our operating days during a period by the number of our ownership days during that period.

(5)

Average number of vessels in the period is calculated by dividing ownership days in the period by the number of days in that period.

(6)

Time charter equivalent rate, or TCE rate, represents our charter revenues less commissions and voyage expenses during a period divided by the number of available days during such period.

(7)

Daily vessel operating expenses include the costs for crewing, insurance, lubricants, spare parts, provisions, stores, repairs, maintenance, statutory and classification expense, drydocking, intermediate and special surveys and other miscellaneous items. Daily vessel operating expenses are calculated by dividing vessel operating expenses for the relevant period by ownership days for such period.

(8)

Daily general and administrative expenses include daily management fees payable to our Manager and costs in relation to our operation as a public company. Daily general and administrative expenses are calculated by dividing general and administrative expenses for the relevant period by ownership days for such period.

About Safe Bulkers, Inc.

The Company is an international provider of marine drybulk transportation services, transporting bulk cargoes, particularly coal, grain and iron ore, along worldwide shipping routes for some of the world’s largest users of marine drybulk transportation services. The Company’s common stock, series B preferred stock, series C preferred stock and series D preferred stock are listed on the NYSE, and trade under the symbols “SB”, “SB.PR.B”, “SB.PR.C”, and “SB.PR.D”, respectively.

Forward-Looking Statements

This press release contains forward-looking statements (as defined in Section 27A of the Securities Act of 1933, as amended, and in Section 21E of the Securities Exchange Act of 1934, as amended) concerning future events, the Company’s growth strategy and measures to implement such strategy, including expected vessel acquisitions and entering into further time charters. Words such as “expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,” “estimates” and variations of such words and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, changes in the demand for drybulk vessels, competitive factors in the market in which the Company operates, risks associated with operations outside the United States and other factors listed from time to time in the Company’s filings with the Securities and Exchange Commission. The Company expressly disclaims any obligations or undertaking to release any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.

For further information please contact:

Company Contact:

Dr. Loukas Barmparis

President
Safe Bulkers, Inc.

Tel.: +30 2 111 888 400

        +357  25 887 200

E-Mail: directors@safebulkers.com  

Investor Relations / Media Contact:

Nicolas Bornozis, President

Capital Link, Inc.

230 Park Avenue, Suite 1536

New York, N.Y. 10169

Tel.: (212) 661-7566

Fax: (212) 661-7526

E-Mail: safebulkers@capitallink.com