GENCO SHIPPING & TRADING LTD (GNK)

ITEM 2.       MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use words such as “anticipate,” “budget”, “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of potential future events, circumstances or future operating or financial performance. These forward-looking statements are based on our management’s current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: (i) declines or sustained weakness in demand in the drybulk shipping industry; (ii) weakness or declines in drybulk shipping rates; (iii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iv) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (v) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (vi) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, lube oil, bunkers, repairs, maintenance, general and administrative expenses, and management expenses; (vii) whether our insurance arrangements are adequate; (viii) changes in general domestic and international political conditions; (ix) military actions, terrorism, or piracy, including without limitation the ongoing conflicts in Ukraine and Iran, related attacks on commercial vessels, and other conflicts in the Middle East; (x) changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (xi) the Company’s acquisition or disposition of vessels; (xii) the amount of offhire time needed to complete maintenance, repairs, and installation of equipment to comply with applicable regulations on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims, including offhire days; (xiii) the completion of definitive documentation with respect to charters; (xiv) charterers’ compliance with the terms of their charters in the current market environment; (xv) the extent to which our operating results are affected by weakness in market conditions and freight and charter rates; (xvi) our ability to maintain contracts that are critical to our operation, to obtain and maintain acceptable terms with our vendors, customers and service providers and to retain key executives, managers and employees; (xvii) completion of documentation for vessel transactions and the performance of the terms thereof by buyers or sellers of vessels and us; (xviii) the relative cost and availability of low sulfur and high sulfur fuel, worldwide compliance with sulfur emissions regulations that took effect on January 1, 2020 and our ability to realize the economic benefits or recover the cost of the scrubbers we have installed; (xix) our financial results for the year ending December 31, 2026 and other factors relating to determination of the tax treatment of dividends we have declared; (xx) the financial results we achieve for each quarter that apply to the formula under our dividend policy, including without limitation the actual amounts earned by our vessels and the amounts of various expenses we incur, as a significant decrease in such earnings or a significant increase in such expenses may affect our ability to carry out our new value strategy; (xxi) the exercise of the discretion of our Board regarding the declaration of dividends, including without limitation the amount that our Board determines to set aside for reserves under our dividend policy; (xxii) outbreaks of disease such as the COVID-19 pandemic; (xxiii) trade conflicts, the imposition or modification of port fees, tariffs and other import restrictions, and the effectiveness and cost of any measures the Company may adopt to avoid or mitigate the impact of the foregoing; and (xxiv) other factors listed from time to time in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2025 and subsequent reports on Form 8-K and Form 10-Q. Our ability to pay dividends in any period will depend upon various factors, including the limitations under any credit agreements to which we may be a party, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance, market developments, and the best interests of the Company and its shareholders. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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The following management’s discussion and analysis should be read in conjunction with our historical consolidated financial statements and the related notes included in this Form 10-Q.

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General

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We are a New York City-based pure-play drybulk ship owning company focused on the seaborne transportation of commodities globally. We transport key cargoes such as iron ore, coal, grain, bauxite, steel products and other drybulk cargoes along worldwide shipping routes. After the expected delivery of the Genco Volunteer during August 2026, our fleet will consist of 44 drybulk vessels, including two Newcastlemax, 18 Capesize, 15 Ultramax and 9 Supramax vessels, with an aggregate carrying capacity of approximately 5,117,000 deadweight tons (“dwt”) and an average age of approximately 12.7 years.

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See pages 37-38 for a table of our current fleet.

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Our approach towards fleet composition is to own a high-quality fleet of vessels focused on Newcastlemax, Capesize, Ultramax and Supramax vessels. Newcastlemax and Capesize vessels represent our major bulk vessel category, while Ultramax and Supramax vessels represent our minor bulk vessel category. Our major bulk vessels are primarily used to transport iron ore, coal and bauxite, while our minor bulk vessels are primarily used to transport grains, steel products and other drybulk cargoes such as cement, scrap, fertilizer, nickel ore, salt and sugar. This approach of owning ships that transport both major and minor bulk commodities provide us with exposure to a wide range of drybulk trade flows.

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We employ an active commercial strategy which consists of a global team located in the U.S., Denmark and Singapore. Overall, we utilize a portfolio approach to revenue generation through a combination of short-term, spot market employment, index-linked time charters as well as opportunistically booking longer term fixed-rate coverage or contracts of affreightment depending on market conditions and management’s outlook. Our fleet deployment strategy currently is weighted towards short-term fixtures, which provides us with optionality on our sizeable fleet.

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Our approach to capital allocation focuses on three key factors:

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Since 2021, we have executed this strategy by reducing our debt by $119.2 million cumulatively through June 30, 2026 while expanding our core major bulk and minor bulk segments. These actions have enabled us to further reduce our cash flow breakeven rate positioning us to pay sizeable quarterly dividends across various market environments.

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In addition to the $73.6 million of cash on our balance sheet as of June 30, 2026, we had undrawn revolver availability of $350.0 million, bringing our total liquidity to $423.6 million.

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Including the $0.80 dividend for the second quarter of 2026, we have declared 28 consecutive quarterly dividends, which total $8.715 per share.

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IMO 2023 Compliance Requirements

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The International Maritime Organization (“IMO”) implemented two key measures to enhance energy efficiency in international shipping with effect from January 2023 which are as follows:

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Revised IMO GHG Strategy

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In July 2023, the IMO adopted an updated greenhouse gas (“GHG”) strategy, setting forth the following targets:

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IMO Net-Zero Framework

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At its 83rd session in April 2025, the IMO’s Marine Environment Protection Committee (“MEPC”) approved draft regulations forming the IMO Net-Zero Framework. Key components include:

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At the second extraordinary session of the MEPC, held in October 2025 specifically to consider formal adoption of the IMO Net-Zero Framework as approved at MEPC’s 83rd session, a lack of consensus among member states led to an unexpected adjournment of the session for one year.

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At MEPC’s 84th session in April 2026, member states did not reach agreement on adoption or substantive revision of the IMO Net-Zero Frame

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Results of Operations

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VOYAGE REVENUES-

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Our revenues are driven primarily by the number of vessels in our fleet, the number of days during which our vessels operate, the type of fixture our vessels are chartered on (spot market voyage charters or fixed rate time charters), and the amount of daily charterhire or freight rates that our vessels earn, that, in turn, are affected by a number of factors, including:

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During 2025, voyage revenues decreased by $80.9 million, or 19.1%, to $342.1 million as compared to $423.0 million during 2024. The decrease in voyage revenues was primarily due to lower rates earned by our major and minor bulk vessels, the operation of a smaller fleet and additional drydocking days during 2025. During 2025, the drybulk freight market experienced a softer first half of the year before strengthening in the second half of the year driven by record Brazilian iron ore exports, improved coal shipments to China and strong Chinese commodity demand. At the beginning of 2026, freight rates have been impacted by various seasonal factors, including weather related disruptions affecting seaborne cargo availability, the frontloaded nature of the newbuilding orderbook, and the timing of the Chinese

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New Year. These factors have impacted the supply and demand balance leading to reduced freight rates relative to levels seen at the end of 2025; however, freight rates are at firm levels for this time of year.

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The average Time Charter Equivalent, or TCE rate, of our overall fleet decreased by 18.9% to $15,502 a day during 2025 from $19,107 a day during 2024. The TCE for our major bulk vessels decreased by 28.0% from $26,699 a day during 2024 to $19,210 a day during 2025. This decrease was primarily a result of lower rates achieved by our Capesize vessels. The TCE for our minor bulk vessels decreased by 6.9% from $14,351 a day during 2024 to $13,355 a day during 2025 primarily a result of lower rates achieved by our Ultramax and Supramax vessels.

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Total ownership days decreased from 15,781.6 days during 2024 to 15,407.9 days during 2025 due to the sale of four Capesize vessels and one Supramax vessel during 2024, partially offset by the delivery of one Capesize vessel during the fourth quarter of 2024 and one Capesize vessel during the fourth quarter of 2025.  Fleet utilization increased from 96.8% during 2024 to 98.4% during 2025.

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Please see pages 7 - 8 for a table that sets forth information about the current employment of the vessels in our fleet.

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VOYAGE EXPENSES-

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In time charters and spot market-related time charters, operating costs including crews, maintenance and insurance, which are recorded as part of vessel operating expenses, are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. These expenses are borne by the Company during spot market voyage charters. There are certain other non-specified voyage expenses such as commissions which are typically borne by us. Voyage expenses include port and canal charges, fuel (bunker) expenses and brokerage commissions payable to unaffiliated third parties. Port and canal charges and bunker expenses primarily increase in periods during which vessels are employed on spot market voyage charters because these expenses are for the account of the vessel owner. At the inception of a time charter, we record the difference between the cost of bunker fuel delivered by the terminating charterer and the bunker fuel sold to the new charterer as a gain or loss within voyage expenses.  Voyage expenses also include the cost of bunkers consumed during short-term time charters pursuant to the terms of the time charter agreement. Additionally, we may record lower of cost and net realizable value adjustments to re-value the bunker fuel on a quarterly basis for certain time charter agreements where the inventory is subject to gains and losses. Refer to Note 2 — Summary of Significant Accounting Policies in our Consolidated Financial Statements.

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Voyage expenses were $115.3 million and $127.0 million during 2025 and 2024, respectively. This decrease was primarily due to lower bunker consumption on our Capesize vessels due to additional drydocking days during 2025 as well lower bunker prices. Additionally, there was a decrease in bunker consumption during short-term time charters pursuant to the terms of the time charter agreement during 2025 as compared to 2024.

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VESSEL OPERATING EXPENSES-

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Vessel operating expenses decreased by $3.1 million from $101.6 million during 2024 to $98.5 million during 2025. This decrease was primarily due to the operation of a smaller fleet.

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Average daily vessel operating expenses (“DVOE”) for our fleet decreased marginally to $6,395 per vessel per day during 2025 from $6,440 per vessel per day during 2024, primarily due to the timing of purchase of stores, lower insurance costs and lower repairs and maintenance expenses, partially offset by higher crew costs and the timing of the purchase of spares.

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Our vessel operating expenses increase to the extent our fleet expands. Other factors beyond our control, some of which may affect the shipping industry in general, including, for instance, developments relating to market prices for crewing, lubes, and insurance, may also cause these expenses to increase. Crew costs on our vessels could increase in the future due to higher wages as a result of the potential impact of the war in Ukraine, the Israel-Hamas war, and the Houthi conflict in the Red Sea, and other conflicts in the Middle East or Venezuela, among other potential macroeconomic events, are unpredictable, and the actual amount of DVOE could be higher or lower than budgeted as a result.

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Based on estimates provided by GSSM, our DVOE budget for the full year of 2026 is expected to be $6,500 per vessel per day. The potential impacts of various macroeconomic events, including but not limited to the war in Ukraine, the Israel-Hamas war, the Houthi conflict in the Red Sea, and other conflicts in the Middle East or Venezuela, are unpredictable, and the actual amount of our DVOE could be higher or lower than budgeted as a result.

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CHARTER HIRE EXPENSES-

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Charter hire expenses decreased by $3.1 million from $9.1 million during 2024 to $6.0 million during 2025. The decrease was primarily due to a decrease in hire rates, partially offset by an increase in chartered-in days.

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GENERAL AND ADMINISTRATIVE EXPENSES-

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We incur general and administrative expenses which relate to our onshore non-vessel-related activities. Our general and administrative expenses include our payroll expenses, including those relating to our executive officers, operating lease expense, legal, auditing and other professional expenses. General and administrative expenses include nonvested stock amortization expense which represents the amortization of stock-based compensation that has been issued to our Directors and employees pursuant to the 2015 Equity Incentive Plan. Refer to Note 17 — Stock-Based Compensation in our Consolidated Financial Statements. General and administrative expenses also include legal and professional fees associated with our credit facilities, which are not capitalizable to deferred financing costs. We also incur general and administrative expenses for our overseas offices located in Singapore and Copenhagen.

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General and administrative expenses increased by $1.7 million from $29.1 million during 2024 to $30.8 million during 2025. The increase was primarily due to higher nonvested stock amortization expense and higher legal and professional fees.

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TECHNICAL MANAGEMENT EXPENSES-

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Technical management expenses include the direct costs incurred by GSSM for the technical management of the vessels under its management. Technical management fees were $5.2 million and $4.6 million during 2025 and 2024, respectively.  The variance was due to the timing of expenses during the year.

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DEPRECIATION AND AMORTIZATION-

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We depreciate the cost of our vessels on a straight-line basis over the expected useful life of each vessel. Depreciation is based on the cost of the vessel less its estimated residual value.

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Depreciation and amortization expenses increased by $7.5 million from $68.7 million during 2024 to $76.2 million during 2025. This increase was primarily due to an increase in drydocking amortization expense for certain vessels that completed their respective drydockings during 2024 and 2025. Additionally, there was an increase in vessel depreciation expense for the Genco Intrepid and Genco Courageous which were delivered during the fourth quarter of 2024 and 2025, respectively, partially offset by a decrease in vessel depreciation for the Genco Warrior and Genco Hadrian which were sold during the second half of 2024.

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IMPAIRMENT OF VESSEL ASSETS-

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Impairment of vessels assets decreased by $5.9 million from $6.6 million during 2024 to $0.7 million during 2025. During 2025, we recorded $0.7 million of impairment of vessel assets related to the loss on disposal of replaced equipment on certain vessels. During 2024, were recorded $6.6 million of impairment of vessel assets that included $5.6 million impairment losses for the Genco Hadrian, a Capesize vessel, which was impaired during the second quarter of

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2024. Additionally, during 2024, we recorded $1.0 million of losses related to the disposal of replaced equipment on certain vessels.

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Refer to Note 2 — Summary of Significant Accounting Policies in our Consolidated Financial Statements for further information regarding the impairment of the vessels.

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NET GAIN ON SALE OF VESSELS-

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During 2024, we recorded a net gain on sale of vessels of $16.5 million related primarily to the gains on the sale of the Genco Warrior, the Genco Claudius and the Genco Maximus partially offset by losses on the sale of the Genco Commodus and the Genco Hadrian. There were no vessel sales during 2025.

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Refer to Note 5 — Vessel Acquisitions and Dispositions in our Consolidated Financial Statements for further information regarding the sale of these vessels.

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OTHER OPERATING EXPENSE-

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Other operating expense of $1.9 million and $5.7 million recorded during 2025 and 2024, respectively, consists of costs incremental to routine expenses that were incurred related to our 2026 Annual Meeting of Shareholders and our 2024 Annual Meeting of Shareholders, respectively.

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OTHER (EXPENSE) INCOME-

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INTEREST EXPENSE-

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Interest expense decreased by $1.0 million from $13.3 million during 2024 to $12.3 million during 2025. Interest expense during 2025 and 2024 consisted primarily of interest expense under our credit facilities and amortization of deferred financing costs for those facilities. The decrease was primarily due to lower outstanding debt during 20

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