Gary Chapman: interest rate
Jim Altschul: I mean, you don’t have other kinds of derivatives like Baltic tanker futures or anything like that, your derivatives are all interest rate related. Correct?
Gary Chapman: Yes, they’re all — the realized and unrealized gain — there’s a breakdown in the earnings release, and the majority of that relates to the valuation of the interest rate swap contracts that goes through the P&L each quarter, because we don’t do hedge accounting.
Jim Altschul: So of that, that figure you have in there $12.37 million, how much of that relates to — this quarter’s interest expense and how much of that can we assume can be offset against the current quarter’s interest expense, and I hope I’m phrasing this properly?
Gary Chapman: Well, they’re two different things. I mean, the interest expense is the interest expense on our debt and then separately, we have interest rate swap contracts that offset some of that. So they’re not actually legally the same thing, if you see what I mean. So I think Jim, if you want to, I’m happy to speak to you separately away from this call, if that’s helpful to you, if you wanted to drop an email to the IR email address, I’m very happy to talk to you. If you want to get into the detail at some point on that.
Jim Altschul: Okay, I will understand it better. Next question. In the press release, you indicated that I guess a couple of the vessels which were redelivered, if that’s the right word. They are currently on short term charter to I believe your sponsor, but at a somewhat lower rate. Can you give us an estimate of what the quarterly revenue impact of these lower rates will be on those particular vessels, how much have we should be
Gary Chapman: Yes, we’ve traditionally not broken down our fleet by vessel for a number of different reasons, and I’m not going to do that here. And in particular, because that is a rate that is somewhat private between the company and its sponsor. However, those rates have been reviewed and checked by our independent conflicts committee as being appropriate rates, given the circumstances. And actually, we believe that it’s positive for the business to have those charters in place, because the alternative, certainly, up until this period, the alternative was potentially no income at all for a period of time. So I think we don’t generally break down our fleet in that respect and we tried to steer our investors away from looking at individual vessels and instead focusing on the total revenues.
Jim Altschul: Certainly, I don’t want to press the point, but there’s more than one vessel affected. I was looking for an aggregate impact on the quarterly revenues of the transition of these — two or three vessels to the short term charters. Would you be able to give us that number?
Gary Chapman: I’m not going to give you a number on that, because I think, as I say, you’ll just be able to — there are two vessels, you’ll just be able to take the number divided by two. So it will kind of lead me in the same direction.
Jim Altschul: And the final thing is, this isn’t — this is not a question actually. And I know this is not — this is supposed to be Q&A, not pontificating. But I would put — as an investor, I would like to put in my $0.02 and no pun intended. I urge all of you to be conservative in calculating, determining your next distributions. I mean, obviously, I enjoy getting a nice quarterly distribution from you every three months. But to me the most important thing is the long term strength of the balance sheet and the company. And as you well know, there are an awful lot of companies that created some major problems for themselves by paying dividends well in excess of what they could really afford, starting with General Electric and General Motors. So again, I would encourage you to be conservative when it comes to making your next decision regarding that distribution.
