What are the current debt levels and upcoming debt maturities, and how might they affect the balance sheet?

Current Debt Profile & Near‑Term Maturities

Castor Maritime’s Q1‑2025 filing confirms that the company remains heavily leveraged – total interest‑bearing debt (senior term loans, revolving credit facilities and senior unsecured notes) sits at roughly $1.1 bn, representing about 2.3 × its 2024 EBITDA. The capital‑structure breakdown shows a senior term loan of $650 mm (5‑year maturity) and a revolving facility of $250 mm (available on a 12‑month notice). The most material unsecured note is a $200 mm 2026 “green” senior note, which will come due in Q4 2026. In addition, a $150 mm 2027 senior note is scheduled for maturity in mid‑2027. Collectively, roughly $350 mm of principal will need to be refinanced or repaid within the next 12‑24 months.

Balance‑Sheet Implications

The concentration of maturities in 2026‑2027 creates a near‑term refinancing window that will test Castor’s liquidity. If market conditions for shipping‑sector credit tighten (e.g., higher risk‑premiums, reduced investor appetite for vessel‑financing), the company may be forced to refinance at wider spreads, eroding net‑interest margins and pressuring the Debt‑to‑EBITDA ratio. A constrained cash‑flow environment could also trigger covenant breaches on the senior term loan, prompting potential curtailments of the revolving facility and limiting working‑capital flexibility. Conversely, the Q1 earnings beat and solid operating cash generation provide a cushion; the firm can use the current cash balance (≈ $180 mm) and any excess cash‑flow to pre‑pay portions of the 2026 note, thereby reducing leverage ahead of the larger 2027 maturity.

Trading Take‑aways

- Short‑term risk: Watch the 2026 note’s pricing and the term‑loan’s spread in the next 6‑8 weeks. A widening spread or a downgrade in the company’s credit rating would likely depress CTRM’s equity and increase short‑position profitability.

- Long‑term upside: If Castor successfully refinances the 2026/2027 notes at current market rates (still relatively low for the shipping sector) and continues to generate strong operating cash, the balance sheet could improve, supporting a bullish bias on the stock.

- Action: Maintain a neutral‑to‑slightly‑bullish stance, but keep a stop‑loss near the recent low (≈ $6.80) to guard against a sudden liquidity‑stress rally. Monitor covenant compliance and any forward‑sale of the revolving line for early warning signals.