Waiver near

DryShips management hopes to secure waivers in September on covenant breaches for $380m in loans, a company executive said Friday.

The Nasdaq-listed bulker and drilling unit owner is in talks with three banks for the waivers, chief operating officer Pankaj Khanna said in a conference call with analysts.

DryShips chief executive George Economou

Khanna's comments come a day after the owner of 41 bulkers, two drilling rigs and four newbuilding drillships reported $52.8m second-quarter profits, which fell by 82.4% compared to the prior period.

Although adjusted earnings at first appeared to top Wall Street estimates, analysts said Friday that the results are in-line with consensus expectations.

The earnings report also showed that the company, a once spot-focussed player that shifted in favour of time-charters last year, now has secured 12 panamaxes on two-year charters ranging from $13,500 per day to $18,300.

Dahlman Rose analyst Omar Nokta says the charters represent a further shift, away from more opportunistic chartering that avoided long-term charters at trough rates.

"While the more conservative approach should enhance its valuation, we believe it may have been better served to remain on the short-term market—especially since management had talked more optimistically on the direction of the dry bulk market recently," Nokta said in a note to clients.

DryShips now has 89% of its fleet fixed for 2009 and 83% next year, leaving only four ships on the spot market.

The company's shares added 2.2% to hit $6.87 in late-morning trading.

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