Navios Maritime Containers Inc. ("Navios Containers " or "the
Company") (N-OTC:NMCI), a growth vehicle dedicated to the container
sector of the maritime industry, today reported financial results
for the period from April 28, 2017 (date of inception) through June
30, 2017.
Angeliki Frangou, Chairman and Chief Executive Officer, stated,
"We are pleased with the launch of Navios Containers, a vehicle
dedicated to the container sector. Navios Containers has the right
to acquire all containerships offered to the Navios Group."
Angeliki Frangou continued: "We are also pleased to have closed
on the Rickmers Maritime Trust transaction and expect all 14
vessels to be delivered to our fleet shortly. We are also
actively seeking to grow the containership fleet during this
difficult part of the cycle where we see attractive valuations for
containerships. We remain in active dialogue with industry
participants regarding possible vessel acquisitions, although the
outcome is far from certain."
HIGHLIGHTS -- RECENT DEVELOPMENTS
Initial Private Placement
On June 8, 2017, Navios Containers closed its
private placement of 10,057,645 shares at a subscription price of
$5.00 per share, resulting in gross proceeds of $50.3 million.
Navios Maritime Partners L.P. (“Navios Partners”) invested $30.0
million and received 59.7% of the equity, and Navios Maritime
Holdings Inc. (“Navios Holdings”) invested $5.0 million and
received 9.9% of the equity of Navios Containers. Each of Navios
Partners and Navios Holdings also received warrants, with a
five-year term, for 6.8% and 1.7% of the equity, respectively.
Navios Containers also registered its shares on
the Norwegian Over-The-Counter Market (N-OTC) on June 12, 2017
under the ticker NMCI.
Fleet Acquisition
Navios Containers used the proceeds of the
private placement to acquire five 4,250 TEU vessels from Navios
Partners for a total purchase price of $64.0 million. The payment
terms included a $24.0 million credit by Navios Partners for a
period of up to 90 days from the purchase date at LIBOR plus 375
bps, of which $14.0 million remained outstanding as of June 30,
2017. These vessels were previously acquired by Navios Partners
from Rickmers Maritime Trust Pte. (“Rickmers Trust”) and are
employed on charters with a net daily charter rate of $26,850 which
expire in 2018 and early 2019.
In addition, Navios Containers acquired all the
rights under the acquisition agreements entered into between Navios
Partners and Rickmers Trust to purchase the remaining nine vessels
in the original 14-vessel container fleet (the “Fleet”) for a
purchase price of $54.0 million plus certain delivery and other
operating costs. As of July 25, 2017, five of these vessels had
been delivered to Navios Containers and the remaining four are
expected to be delivered during August 2017.
Credit Facility
On June 29, 2017, Navios Containers entered into
a loan facility for an amount of $40.0 million with a commercial
bank in order to finance the acquisition of seven container vessels
of the Fleet (including the original five vessels). The facility is
repayable in six consecutive quarterly instalments of $3.8 million
each, plus a balloon payment on the last repayment date. The
facility matures in December 2018 and bears interest at LIBOR plus
385 bps per annum. As of June 30, 2017, the outstanding loan amount
under this facility was $34.3 million and an additional amount of
$3.2 million was drawn in July 2017. The Company is in advanced
discussions with the same commercial bank for the financing of the
remaining seven vessels of the Fleet.
Fleet Development
Navios Containers controls a fleet of 14 vessels, of which four
vessels are expected to be delivered during August 2017, totaling
57,100 TEU and the current average age of the fleet is 9.7 years.
As of July 25, 2017, Navios Containers has chartered-out 46.7% of
available days for the remaining six months of 2017, expecting to
generate revenues of approximately $26.0 million. The average
contractual daily charter-out rate for the fleet during this period
is expected to be $23,780.
Earnings Highlights
EBITDA is a non-U.S. GAAP financial measure and should not be
used in isolation or as a substitute for Navios Containers’ results
calculated in accordance with U.S. GAAP.
See Exhibit I under the heading, “Disclosure of Non-GAAP
Financial Measures,” for a discussion of EBITDA of Navios
Containers and a reconciliation of this measure to the most
comparable measures calculated under U.S. GAAP.
Second Quarter 2017 Results (in thousands of U.S.
dollars, except per share data and unless otherwise
stated):
The second quarter 2017 information presented below was derived
from the unaudited condensed consolidated financial statements for
the respective period.
|
|
Period from April 28, 2017(date of
inception) to June30, 2017 |
|
|
|
|
|
|
(unaudited) |
Revenue |
|
$ |
3,102 |
|
Net income |
|
$ |
881 |
|
Net cash used in
operating activities |
|
$ |
(1,491 |
) |
EBITDA |
|
$ |
2,281 |
|
Basic Earnings per
Share |
|
$ |
0.09 |
|
|
|
|
|
|
Fleet Summary Data:
The following table reflects certain key indicators indicative
of the performance of the Navios Containers' operations and its
fleet performance for the period from which the vessels were
delivered, June 8, 2017 through June 30, 2017.
|
Period from June 8, 2017to June 30,
2017 |
|
|
|
|
|
(Unaudited) |
Available Days (1) |
|
|
115 |
|
Operating Days (2) |
|
|
115 |
|
Fleet Utilization
(3) |
|
|
100% |
|
Vessels operating at
period end |
|
|
5 |
|
TCE (4) |
|
$ |
26,968 |
|
(1 |
) |
Available
days for the fleet are total calendar days the vessels were in
Navios Containers' possession for the relevant period after
subtracting off-hire days associated with major repairs, drydocking
or special surveys. The shipping industry uses available days to
measure the number of days in a relevant period during which
vessels should be capable of generating revenues. |
(2 |
) |
Operating
days are the number of available days in the relevant period less
the aggregate number of days that the vessels are off-hire due to
any reason, including unforeseen circumstances. The shipping
industry uses operating days to measure the aggregate number of
days in a relevant period during which vessels actually generate
revenues. |
(3 |
) |
Fleet
utilization is the percentage of time that Navios Containers'
vessels were available for generating revenue, and is determined by
dividing the number of operating days during a relevant period by
the number of available days during that period. The shipping
industry uses fleet utilization to measure a company's efficiency
in finding suitable employment for its vessels. |
(4 |
) |
TCE is
defined as voyage and time charter revenues less voyage expenses
during a relevant period divided by the number of available days
during the period. |
About Navios Maritime Containers
Inc.
Navios Maritime Containers Inc. (N-OTC:NMCI) is a growth vehicle
dedicated to the container sector of the maritime industry. For
more information, please visit its website at
www.navios-containers.com.
About Navios Maritime Holdings Inc.
Navios Maritime Holdings Inc. (NYSE:NM) is a global, vertically
integrated seaborne shipping and logistics company focused on the
transport and transshipment of dry bulk commodities including iron
ore, coal and grain. For more information about Navios Holdings
please visit our website: www.navios.com.
About Navios Maritime Partners L.P.
Navios Partners (NYSE:NMM) is a publicly traded master limited
partnership which owns and operates container and dry bulk vessels.
For more information, please visit its website at
www.navios-mlp.com.
Forward Looking Statements - Safe Harbor
This press release contains forward-looking statements
concerning future events, including cash flow generation for the
remainder of 2017, future contracted revenues, financial
performance of the fleet, vessel deliveries, and Navios Containers'
growth strategy and measures to implement such strategy; including
expected vessel acquisitions and the ability to secured related
financing, the further growth of our containership fleet, and
entering into further time charters. Words such as “may,”
“expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,”
“estimates,” and variations of such words and similar expressions
are intended to identify forward-looking statements. These
forward-looking statements are based on the information available
to, and the expectations and assumptions deemed reasonable by
Navios Containers at the time these statements were made. Although
Navios Containers believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be
given that such expectations will prove to have been correct. These
statements involve known and unknown risks and are based upon a
number of assumptions and estimates which are inherently subject to
significant uncertainties and contingencies, many of which are
beyond the control of Navios Containers. Actual results may differ
materially from those expressed or implied by such forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, risks relating to the
completion of the fleet acquisition on the anticipated timing or at
all, the quality of the fleet and the market for the fleet vessels,
the uncertainty relating to global trade, including prices of
seaborne commodities and continuing issues related to seaborne
volume and ton miles, our continued ability to enter into long-term
time charters, our ability to maximize the use of our vessels,
expected demand in the container shipping sector in general,
fluctuations in charter rates for container carrier vessels, the
aging of our fleet and resultant increases in operations costs, the
loss of any customer or charter or vessel, the financial condition
of our customers, changes in the availability and costs of funding
due to conditions in the bank market, capital markets and other
factors, increases in costs and expenses, including but not limited
to: crew wages, insurance, provisions, port expenses, lube oil,
bunkers, repairs, maintenance, and general and administrative
expenses, the expected cost of, and our ability to comply with,
governmental regulations and maritime self-regulatory organization
standards, as well as standard regulations imposed by our
charterers applicable to our business, general domestic and
international political conditions, competitive factors in the
market in which Navios Containers operates, and risks associated
with global operations. Navios Containers expressly disclaims any
obligations or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in Navios Containers' expectations with respect
thereto or any change in events, conditions or circumstances on
which any statement is based. Navios Containers makes no prediction
or statement about the performance of its common stock.
EXHIBIT I |
NAVIOS MARITIME CONTAINERS INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME |
(Expressed in thousands of U.S. dollars -
except for share and per share data) |
|
|
|
Period from April 28,
2017(date of inception) to June
30,2017 |
|
(unaudited) |
|
|
|
|
Revenue |
$ |
3,102 |
|
Time charter and voyage
expenses |
|
|
(1 |
) |
|
Management fees
(entirely through related parties transactions) |
|
|
(702 |
) |
|
General and
administrative expenses |
|
|
(117 |
) |
|
Depreciation and
amortization |
|
|
(1,320 |
) |
|
Interest expense and
finance cost, net |
|
|
(80 |
) |
|
Other (expense)/
income, net |
|
(1 |
) |
|
Net
income |
$ |
881 |
|
|
|
|
|
|
Net income
attributable to common stockholders |
$ |
881 |
|
|
|
|
|
|
|
Net earnings per share,
basic and diluted |
$ |
0.09 |
|
|
Weighted average number
of shares, basic and diluted |
|
|
10,057,645 |
|
|
|
|
NAVIOS MARITIME CONTAINERS INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(Expressed in thousands of U.S. dollars – except for
share data) |
|
|
|
|
|
June 30,2017(unaudited) |
ASSETS |
|
|
|
Current
assets |
|
|
|
Cash and cash
equivalents |
|
$ |
34,936 |
Prepaid and other
current assets |
|
|
40 |
Amounts due from
related companies |
|
|
3,292 |
Total current
assets |
|
|
38,268 |
|
|
|
|
Vessels, net |
|
|
32,339 |
Favorable lease
terms |
|
|
25,353 |
Long- term receivable
from related companies |
|
|
1,373 |
Total
non-current assets |
|
|
59,065 |
|
|
|
|
Total
assets |
|
$ |
97,333 |
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities |
|
|
|
Accounts payable |
|
$ |
82 |
Accrued expenses |
|
|
2,515 |
Deferred income and
cash received in advance |
|
|
1,561 |
Amounts due to related
companies |
|
|
1,723 |
Consideration payable
to parent company |
|
|
14,000 |
Current portion
of long-term debt, net |
|
|
12,317 |
Total current
liabilities |
|
|
32,198 |
|
|
|
|
Long-term debt, net of
current portion and deferred financing fees |
|
|
21,353 |
Total
non-current liabilities |
|
|
21,353 |
|
|
|
|
Total
liabilities |
|
$ |
53,551 |
|
|
|
|
Commitments and
contingencies |
|
|
— |
Stockholders’
equity |
|
|
|
Common stock — $0.0001 par value, 75,000,000 authorizedregistered
ordinary shares, 10,057,645 issued and outstanding as ofJune 30,
2017. |
|
|
1 |
Additional paid-in
capital |
|
|
42,900 |
Retained earnings |
|
|
881 |
Total
stockholders’ equity |
|
|
43,782 |
Total
liabilities and stockholders’ equity |
|
$ |
97,333 |
|
|
|
|
|
NAVIOS MARITIME CONTAINERS INC. |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(Expressed in thousands of U.S. dollars – except for
share data) |
|
|
|
Period from April 28,
2017(date of inception) to June
30, 2017
(unaudited) |
OPERATING
ACTIVITIES: |
|
|
|
Net income |
$ |
881 |
|
Adjustments to
reconcile net income to net cash used in
operatingactivities: |
|
|
|
Depreciation and
amortization |
|
1,320 |
|
|
|
|
|
Changes in
operating assets and liabilities: |
|
|
|
Increase in due from
related companies |
|
(2,844 |
) |
Decrease in prepaid and
other current assets |
|
7 |
|
Increase in long-term
receivable from affiliate companies |
|
(1,373 |
) |
Increase in accounts
payable |
|
35 |
|
Increase in accrued
expenses |
|
1,123 |
|
Increase in due to
related companies |
|
49 |
|
Decrease in deferred
income and cash received in advance |
|
(689 |
) |
Net cash used
in operating activities |
$ |
(1,491 |
) |
|
|
|
|
INVESTING
ACTIVITIES: |
|
|
|
Cash acquired through
asset acquisition |
|
5,433 |
|
Acquisition of vessels
and favorable lease terms |
|
(50,000 |
) |
Net cash used
in investing activities |
$ |
(44,567 |
) |
|
|
|
|
FINANCING
ACTIVITIES: |
|
|
|
Proceeds from long-term
borrowings |
|
34,320 |
|
Debt issuance
costs |
|
(650 |
) |
Proceeds from issuance
of common shares, net of offering costs |
|
47,324 |
|
Net cash
provided by financing activities |
$ |
80,994 |
|
|
|
|
|
Increase in
cash and cash equivalents |
$ |
34,936 |
|
Cash and cash
equivalents, beginning of period |
$ |
- |
|
Cash and cash
equivalents, end of period |
$ |
34,936 |
|
|
|
|
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION
Non-cash
investing and financing activities |
|
|
|
|
Consideration payable
net of working capital acquired |
|
|
$ |
(11,273 |
) |
Deemed distribution
payable to controlling shareholders |
|
|
$ |
(4,423 |
) |
|
NAVIOS MARITIME CONTAINERS INC. |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES
IN EQUITY |
(Expressed in thousands of U.S. dollars — except for
share data) |
|
For the period from April 28, 2017 (date of inception) to
June 30, 2017 |
|
|
|
|
Number
ofCommonShares |
|
|
Common Stock |
|
|
AdditionalPaid-inCapital |
|
RetainedEarnings |
|
Total Stockholders’ Equity |
Balance April
28, 2017 (date of inception) |
|
|
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
$ |
- |
|
Issuance of common
stock, net of offering expenses |
|
|
10,057,645 |
|
|
|
1 |
|
|
|
47,323 |
|
|
|
- |
|
|
47,324 |
|
Deemed distribution to
controlling shareholders |
|
|
- |
|
|
|
- |
|
|
|
(4,423 |
) |
|
|
- |
|
|
(4,423 |
) |
Net income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
881 |
|
|
881 |
|
Balance
June 30, 2017 (unaudited) |
|
|
10,057,645 |
|
|
$ |
1 |
|
|
$ |
42,900 |
|
|
$ |
881 |
|
$ |
43,782 |
|
Disclosure of Non-GAAP Financial Measures
EBITDA is a “non-U.S. GAAP financial measure” and should not be
used in isolation or considered a substitute for net income/(loss),
cash flow from operating activities and other operations or cash
flow statement data prepared in accordance with generally accepted
accounting principles in the United States.
EBITDA represents net income/(loss) before interest and finance
costs, before depreciation and amortization, before income taxes
and before stock-based compensation. We use EBITDA as liquidity
measures and reconcile EBITDA to net cash provided by/(used in)
operating activities, the most comparable U.S. GAAP liquidity
measure. EBITDA is calculated as follows: net cash provided by
operating activities adding back, when applicable and as the case
may be, the effect of (i) net increase/(decrease) in operating
assets, (ii) net (increase)/decrease in operating liabilities,
(iii) net interest cost, (iv) deferred finance charges, (v)
provision for losses on accounts receivable, and (vi) payments for
drydock and special survey costs. Navios Containers believes that
EBITDA is a basis upon which liquidity can be assessed and
represents useful information to investors regarding Navios
Containers’ ability to service and/or incur indebtedness, pay
capital expenditures, meet working capital requirements and pay
dividends. Navios Containers also believes that EBITDA is used (i)
by prospective and current lessors as well as potential lenders to
evaluate potential transactions; (ii) to evaluate and price
potential acquisition candidates; and (iii) by securities analysts,
investors and other interested parties in the evaluation of
companies in our industry.
EBITDA is presented to provide additional information with
respect to the ability of Navios Containers to satisfy its
respective obligations, including debt service, capital
expenditures, working capital requirements and pay dividends. While
EBITDA is frequently used as a measure of operating results and the
ability to meet debt service requirements, the definition of EBITDA
used here may not be comparable to those used by other companies
due to differences in methods of calculation.
EBITDA has limitations as an analytical tool, and therefore,
should not be considered in isolation or as a substitute for the
analysis of Navios Containers’ results as reported under U.S. GAAP.
Some of these limitations are: (i) EBITDA does not reflect changes
in, or cash requirements for, working capital needs; (ii) EBITDA
does not reflect the amounts necessary to service interest or
principal payments on our debt and other financing arrangements;
and (iii) although depreciation and amortization are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future. EBITDA does not reflect any cash
requirements for such capital expenditures. Because of these
limitations, among others, EBITDA should not be considered as a
principal indicator of Navios Containers’ performance. Furthermore,
our calculation of EBITDA may not be comparable to that reported by
other companies due to differences in methods of calculation.
Navios Containers Reconciliation of EBITDA to Cash from
Operations |
|
|
|
|
Period from April 28,2017(date of
inception) to June30, 2017 |
|
|
(in thousands
of U.S. dollars) |
|
(unaudited) |
|
|
|
|
Net cash
used in operating activities |
|
$ |
(1,491 |
) |
Net
increase in operating assets |
|
|
4,210 |
|
Net
increase in operating liabilities |
|
|
(518 |
) |
Net
interest cost |
|
|
80 |
|
EBITDA(1) |
|
$ |
2,281 |
|
(1) |
|
|
Period from April 28,2017(date of
inception) to June30, 2017 |
|
|
|
(in
thousands of U.S. dollars) |
|
|
(unaudited) |
|
|
|
|
|
Net cash used in operating activities |
|
|
$ |
(1,491 |
) |
Net cash used in investing activities |
|
|
$ |
(44,567 |
) |
Net cash provided by financing activities |
|
|
$ |
80,994 |
|
EXHIBIT II |
Owned Vessels |
|
Vessel Name |
|
TEU |
|
Year Built |
Navios Summer |
|
3,450 |
|
2006 |
Navios Verano |
|
3,450 |
|
2006 |
Navios Verde |
|
4,250 |
|
2007 |
Navios Amarillo |
|
4,250 |
|
2007 |
Navios Azure |
|
4,250 |
|
2007 |
MOL Dominance |
|
4,250 |
|
2008 |
MOL Delight |
|
4,250 |
|
2008 |
MOL Dedication |
|
4,250 |
|
2008 |
MOL Devotion |
|
4,250 |
|
2009 |
MOL Destiny |
|
4,250 |
|
2009 |
Vessels to be Delivered |
|
Vessel Name |
|
TEU |
|
Year Built |
|
Delivery Date |
Moni Rickmers |
|
3,450 |
|
2007 |
|
08/2017 |
Erwin Rickmers |
|
4,250 |
|
2007 |
|
08/2017 |
Sabine Rickmers |
|
4,250 |
|
2007 |
|
08/2017 |
Vicki Rickmers |
|
4,250 |
|
2007 |
|
08/2017 |
Contact:
Navios Maritime Containers Inc.
+1.212.906.8648
investors@navios-containers.com
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