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Subject:  GOGL: A preview Date:  12/3/2021  3:30 AM
Author:  HohumYNWA Number:  25818 of 25979

Dry bulk shipping entity Golden Ocean (GOGL) reported last week.

Golden Ocean (GOGL) is a sizable dry bulk shipping entity, so I did a review of the company as a significant player in the dry bulk shipping sector. That review can be found here--

So here's what we have
1. Major shipping entity with a fleet of 81 (48 Cape category vessels, 31 Panamax category vessels, 2 Supramax category vessels) owned vessels.
2. An additional 11 vessels chartered-in
3. An investment stake in a fleet managing entity, SwissMarine
4. A joint venture participant (10% owner) in a fuel management business

As noted in the link above, GOGL had a great Q3 2021 and is rewarding its shareholders with a nice dividend payout (ex-div is 12/8/21). GOGL mgmt have already booked a large percentage of Q4 2021
~ $41,900 daily for 83% of Cape days
~ $27,300 daily for 87% of Panamax days
which bodes well for Q4 2021.

Risks or Negatives:
i. Unpredictability of dry bulk shipping market
ii. Uncertainty surrounding costs associated with EEXI/EEDI
iii. John Fredriksen risk (Though his trusts do have ~40% ownership stake in GOGL)
iv. Future financing costs if interest rates rise (in mid 2021, GOGL managed to arrange $435M in financing @ under 2.25% + LIBOR)

Upsides or Positives:
i. Low fleet growth the next couple of years
ii. Age of GOGL fleet. Only six owned vessels were built in 2010, or earlier.
iii. John Fredriksen backing. Although I did mention Fredriksen as a risk/negative earlier, I do think Fredriksen backing the company helped GOGL secure the favorable financing.
iv. Opportunistic. GOGL locking in very good short term coverage helps to weather some surprises
v. Vessel values have recovered well since the start of 2021, and continue to hold up well

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