| Financial Instruments and Fair Value Disclosures |
14. Financial Instruments and Fair Value Disclosures Our principal financial assets consist of cash and cash equivalents, investment securities, amounts due from related parties, derivative instruments, and trade accounts receivable. Our principal financial liabilities consist of long-term debt, accounts payable, amounts due to related parties, and accrued expenses. | (a) | Concentration of credit risk: Financial instruments, which may subject us to significant concentrations of credit risk, consist principally of amounts due from our charterers, including the receivables from Helios Pool, and cash and cash equivalents. We limit our credit risk with amounts due from our charterers, including those through the Helios Pool, by performing ongoing credit evaluations of our charterers’ financial condition and generally do not require collateral from our charterers. We limit our credit risk with our cash and cash equivalents and restricted cash by placing it with highly-rated financial institutions and directly or indirectly highly liquid, short term highly rated debt obligations. |
| (b) | Interest rate risk: Two of our long-term bank loans are based on SOFR and hence we are exposed to movements thereto. We entered into interest rate swap agreements in order to hedge a majority of our variable interest rate exposure related to the 2023 A&R Debt Facility, with one such swap currently in effect as of June 30, 2026. The ratio between the debt outstanding under the 2023 A&R Debt Facility and the notional amount of the swap is 89% as of June 30, 2026. This interest rate swap carries a fixed interest rate of 2.8525%. The Areion Facility is currently unhedged. We have no exposure to floating rate movements on any of our other debt financings. |
| (c) | Fair value measurements: Interest rate swaps are stated at fair value, which is determined using a discounted cash flow approach based on market‑based SOFR swap yield rates. SOFR swap rates are observable at commonly quoted intervals for the full terms of the swaps and, therefore, are considered Level 2 items in accordance with the fair value hierarchy. The fair value of the interest rate swap agreements approximates the amount that we would have to pay or receive for the early termination of the agreements. |
The following table summarizes the location on the balance sheet of the financial assets and liabilities that are carried at fair value on a recurring basis, which comprise our financial derivatives, all of which are considered Level 2 items in accordance with the fair value hierarchy as of: | | | | | | | | | | | | | | | | | June 30, 2026 | | | March 31, 2026 | | | | Other non-current assets | | Long-term liabilities | | Other non-current assets | | Long-term liabilities | | Derivatives not designated as hedging instruments | | Derivative instruments | | Derivative instruments | | Derivative instruments | | Derivative instruments | | Interest rate swap agreements | | $ | 3,270,389 | | $ | — | | $ | 2,337,425 | | $ | — | |
The effect of derivative instruments within the unaudited interim condensed consolidated statements of operations for the periods presented is as follows: | | | | | | | | | | | | | | Three months ended | | Derivatives not designated as hedging instruments | | Location of gain/(loss) recognized | | June 30, 2026 | | June 30, 2025 | | Interest rate swaps—change in fair value | | Unrealized gain/(loss) on derivatives | | | 932,965 | | | (1,183,841) | | Interest rate swaps—realized gain | | Realized gain on derivatives | | | 286,510 | | | 539,429 | | Gain/(loss) on derivatives, net | | | | $ | 1,219,475 | | $ | (644,412) | |
As of June 30, 2026 and March 31, 2026, no fair value measurements for assets or liabilities under Level 1 or Level 3 were recognized in the consolidated balance sheets with the exception of Level 1 items cash and cash equivalents, restricted cash, and investment securities. We did not have any other assets or liabilities measured at fair value on a non-recurring basis during the three months ended June 30, 2026 and 2025. | (d) | Book values and fair values of financial instruments: In addition to the derivatives that we are required to record at fair value on our balance sheet (see (c) above) we have investment securities that are recorded at fair value and included in other current assets in our balance sheet. We have other financial instruments that are carried at historical cost including trade accounts receivable, equity securities, at cost, amounts due from related parties, cash and cash equivalents, restricted cash, accounts payable, amounts due to related parties |
| | and accrued liabilities for which the historical carrying value approximates the fair value due to the short-term nature of these financial instruments. |
The summary of gains and losses on our investment securities included in other gain/(loss), net as stated in our unaudited interim condensed consolidated statements of operations for the periods presented is as follows: | | | | | | | | | | Three months ended | | | | June 30, 2026 | | June 30, 2025 | | Unrealized gain on investment securities | | $ | 212,155 | | $ | 3,034 | | Net gain on investment securities | | $ | 212,155 | | $ | 3,034 | |
We have long-term bank debt, the 2023 A&R Debt Facility and Areion Facility, for which we believe the carrying values approximate their fair value as the loans bear interest at variable interest rates based on SOFR at June 30, 2026 and 2025, which is observable at commonly quoted intervals for the full terms of the loans, and hence are considered as a Level 2 item in accordance with the fair value hierarchy. We have long-term debt related to Cresques Japanese Financing, Cratis Japanese Financing, Copernicus Japanese Financing, Chaparral Japanese Financing, Cougar Japanese Financing, Caravelle Japanese Financing, and Captain Markos Dual-Fuel Japanese Financing, (collectively, the “Japanese Financings”) that incur interest at a fixed rate. We have long-term debt related to the BALCAP Facility that incurs interest at a fixed rate. The Japanese Financings and BALCAP Facility are considered Level 2 items in accordance with the fair value hierarchy and the fair value of each is based on a discounted cash flow analysis using current observable interest rates. The following table summarizes the carrying value and estimated fair value of our fixed rate debt obligations as of: | | | | | | | | | | | | | | | | | June 30, 2026 | | | March 31, 2026 | | | | Carrying Value | | Fair Value | | | Carrying Value | | Fair Value | | Corsair Japanese Financing | | $ | — | | $ | — | | | $ | 24,645,833 | | $ | 24,354,660 | | Cresques Japanese Financing | | | 21,629,588 | | | 22,347,981 | | | | 22,071,744 | | | 23,176,904 | | Cratis Japanese Financing | | | 32,320,000 | | | 30,746,676 | | | | 33,340,000 | | | 32,066,599 | | Copernicus Japanese Financing | | | 32,320,000 | | | 30,746,676 | | | | 33,340,000 | | | 32,066,599 | | Chaparral Japanese Financing | | | 53,891,108 | | | 53,148,527 | | | | 54,594,492 | | | 54,386,863 | | Caravelle Japanese Financing | | | 34,400,000 | | | 32,605,177 | | | | 35,300,000 | | | 33,893,259 | | Cougar Japanese Financing | | | 35,600,000 | | | 36,504,579 | | | | 36,500,000 | | | 37,996,095 | | Captain Markos Dual-Fuel Japanese Financing | | | 47,600,000 | | | 49,531,888 | | | | 48,230,000 | | | 51,115,820 | | BALCAP Facility | | | 47,748,113 | | | 47,083,765 | | | | 49,891,595 | | | 49,119,651 | |
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