Performance Shipping Inc. Announces Acceptance of a Signed Commitment Letter From Alpha Bank A.E. to Refinance Existing Facilities

Rhea-AI Summary

Performance Shipping (NASDAQ: PSHG) has accepted a commitment letter from Alpha Bank A.E. for refinancing existing loan facilities worth $29.75 million. The new facility will be secured by vessels M/T P. Long Beach and M/T P. Aliki, featuring SOFR plus 1.90% interest rate.

The loan will be repaid through 20 quarterly installments of $1.05 million each, with a $8.75 million balloon payment due in mid-2030. The refinancing offers significant benefits, including a 23% reduction in average payable margins and extension of loan maturities by over two and a half years.

Positive

• Financing costs significantly reduced with 23% decrease in average payable margins
• Loan maturities extended by over 2.5 years with no substantial debt maturities before mid-2030
• Maintained same amortization profile while securing better terms
• Demonstrates strong relationship with lenders and robust financial position

Negative

• Substantial balloon payment of $8.75 million due in mid-2030
• Refinancing subject to customary closing conditions and final loan agreement execution

Insights

Maritime Finance Specialist

PSHG secures favorable refinancing with Alpha Bank, reducing interest margins by 23% and extending maturities to 2030, strengthening financial flexibility.

Performance Shipping's refinancing agreement with Alpha Bank represents a significant financial improvement for this tanker vessel operator. The $29.75 million facility will refinance existing debt secured by two vessels while offering markedly better terms than their previous arrangements.

The new terms include an interest rate of SOFR plus 1.90%, with repayment structured across 20 quarterly installments of $1.05 million each and a $8.75 million balloon payment due in mid-2030. The 23% reduction in average payable margins directly strengthens PSHG's profitability by lowering recurring interest expenses while maintaining the same principal amortization schedule.

Perhaps more strategically valuable is the extension of loan maturities by over 2.5 years, which significantly improves the company's liquidity runway. With no substantial debt maturities until mid-2030, PSHG gains enhanced financial flexibility to navigate market cycles in the volatile tanker industry.

The willingness of Alpha Bank to offer improved terms indicates external validation of PSHG's creditworthiness and financial stability. In the capital-intensive shipping sector, where vessel financing represents a major cost component, securing competitive debt terms constitutes a meaningful competitive advantage. This refinancing strengthens PSHG's capital structure while preserving operational capacity, positioning the company more favorably for both weathering potential downturns and capitalizing on growth opportunities in the tanker market.

ATHENS, Greece, June 24, 2025 (GLOBE NEWSWIRE) -- Performance Shipping Inc. (NASDAQ: PSHG), (“we” or the “Company”), a global shipping company specializing in the ownership of tanker vessels, today announced that it has accepted a commitment letter whereby it intends to enter into an agreement for a refinancing of the existing loan outstanding of US$29,750,000 with Alpha Bank A.E. (the “Facility”) through two separate wholly-owned subsidiaries of the Company. This Facility is subject to the completion of customary closing conditions and the execution of a final loan agreement by the Company and its lenders. Proceeds from the Facility will be used to refinance in full the existing indebtedness maintained with Alpha Bank and secured by the M/T P. Long Beach and the M/T P. Aliki. This Facility shall bear interest at the rate of SOFR plus 1.90% per annum.

The Facility will be repayable in twenty (20) consecutive quarterly installments of US$1,050,000 each, and concurrent with the twentieth quarterly installment, the Company will owe a balloon payment of US$8,750,000 in mid-2030.

Commenting on the refinancing facility, Andreas Michalopoulos, the Company’s Chief Executive Officer, stated:

“The commitment letter from Alpha Bank underscores our Company’s strong and enduring relationships with its lenders. The competitive terms of this refinancing loan facility reflect both our robust financial position and the continued confidence and support of our lending partners. Indicatively, our financing costs will be significantly reduced, with average payable margins decreasing by 23% compared to the existing loan agreements, while the amortization profile remains unchanged. Additionally, with the extension of loan maturities by more than two and a half years the Company has no substantial debt maturities scheduled prior to mid-2030.”

About the Company

Performance Shipping Inc. is a global provider of shipping transportation services through its ownership of tanker vessels. The Company employs its fleet on spot voyages, through pool arrangements and on time charters.

Cautionary Statement Regarding Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include, but are not limited to, statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts, including with respect to the delivery of the vessels we have agreed to acquire, future market conditions and the prospective financing and employment of our vessels. The words “believe," “anticipate," “intends," “estimate," “forecast," “project," “plan," “potential," “will," “may," “should," “expect," “targets," “likely," “would," “could," “seeks," “continue," “possible," “might," “pending” and similar expressions, terms or phrases may identify forward-looking statements.

The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, our management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs, or projections.

In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include, but are not limited to: the strength of world economies, fluctuations in currencies and interest rates, general market conditions, including fluctuations in charter rates and vessel values, changes in demand in the tanker shipping industry, changes in the supply of vessels, changes in worldwide oil production and consumption and storage, changes in our operating expenses, including bunker prices, crew costs, drydocking and insurance costs, our future operating or financial results, availability of financing and refinancing including with respect to vessels we agree to acquire, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, the length and severity of epidemics and pandemics, including COVID-19, and their impact on the demand for seaborne transportation of petroleum and other types of products, general domestic and international political conditions or events, including “trade wars”, armed conflicts including the war in Ukraine and the war between Israel and Hamas or Iran, the imposition of new international sanctions, acts by terrorists or acts of piracy on ocean-going vessels, potential disruption of shipping routes due to accidents, labor disputes or political events, vessel breakdowns and instances of off-hires and other important factors. Please see our filings with the US Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties.

Corporate Contact:
Andreas Michalopoulos
Chief Executive Officer, Director and Secretary
Telephone: +30-216-600-2400
Email: amichalopoulos@pshipping.com
Website: www.pshipping.com

Investor and Media Relations:
Edward Nebb
Comm-Counsellors, LLC
Telephone: + 1-203-972-8350
Email: enebb@optonline.net

FAQ

What are the key terms of Performance Shipping's (PSHG) new refinancing facility with Alpha Bank?

The facility includes a $29.75 million loan with SOFR plus 1.90% interest rate, repayable in 20 quarterly installments of $1.05 million each, and an $8.75 million balloon payment due in mid-2030.

How will the Alpha Bank refinancing affect PSHG's financing costs?

The refinancing will reduce average payable margins by 23% compared to existing loan agreements, significantly lowering financing costs.

What vessels are securing Performance Shipping's new Alpha Bank facility?

The facility is secured by two vessels: the M/T P. Long Beach and M/T P. Aliki.

When is Performance Shipping's (PSHG) next major debt maturity?

Following this refinancing, PSHG has no substantial debt maturities scheduled before mid-2030, when the $8.75 million balloon payment is due.

How much are the quarterly installments for PSHG's new Alpha Bank loan?

The quarterly installments are $1.05 million, payable over 20 consecutive quarters.