Navios Maritime Partners L.P. (“Navios Partners”) (NYSE: NMM), an
international owner and operator of dry cargo vessels, today
reported its financial results for the third quarter and nine
months ended September 30, 2018.
Angeliki Frangou, Chairman and Chief Executive
Officer of Navios Partners stated, “I am pleased with the results
for the third quarter of 2018, for which Navios Partners had $42.0
million of EBITDA and $16.3 million of adjusted net income. We
declared a quarterly distribution of $0.02 per unit for the third
quarter, representing a current yield of approximately 5.5%.”
Angeliki Frangou continued, “NMM has good
liquidity and a strong balance sheet. As of September 30, 2018, we
had $58.3 million of cash and total debt of $511.7 million. Our net
debt to book capitalization was 35%, representing a 16% reduction
compared to the fourth quarter of 2016. We have no committed
growth capex and no debt maturities until 2020.”
Distributions
- Distribution of Navios Containers units
Navios Partners announced a distribution of
approximately 2.5% of the outstanding equity of Navios Maritime
Containers Inc. (“Navios Containers”) to the unitholders of Navios
Partners in connection with the proposed listing of Navios
Containers on a U.S. stock exchange as set forth in the
registration statement on Form F-1, filed with the U.S. Securities
and Exchange Commission. Following the distribution, Navios
Partners will own approximately 33.5% of the equity in Navios
Containers. Approximately 855,050 shares of common equity of Navios
Containers will be distributed by Navios Partners to its
unitholders, with the actual number of shares of common equity
distributed depending on the number of units of Navios Partners
that are issued and outstanding on the record date. The record date
for the unitholders entitled to the distribution will be November
23, 2018 and the distribution is expected to occur on or about
December 3, 2018.
The Board of Directors of Navios Partners
declared a cash distribution for the third quarter of 2018 of $0.02
per unit. The cash distribution is payable on November 14, 2018 to
all unitholders of record as of November 7, 2018.
Fleet Developments
On August 31, 2018, Navios Partners took delivery of the Navios
Sphera, a 2016-built Panamax vessel of 84,872 dwt and the Navios
Mars, a 2016-built Capesize vessel of 181,259 dwt, from its
affiliate, Navios Holdings, for an aggregate purchase price of
$79.0 million.
- Sale of Navios Felicity and Navios Libra
II
In October 2018, Navios Partners agreed to sell the Navios Libra
II, a 1995-built Panamax vessel of 70,136 dwt and the Navios
Felicity, a 1997-built Panamax vessel of 73,867 dwt, to unrelated
third parties, for net sale prices of $4.6 million and $4.7
million, respectively. The Company is expected to recognize a book
loss from the sale of the two vessels of approximately $6.6
million, of which $5.3 million has already been included in the
third quarter of 2018. The sales are expected to be completed by
the end of 2018.
- Navios Fantastiks, 2005-built Capesize
|
In October 2018, Navios
Partners fixed the Navios Fantastiks, a 2005-built Capesize vessel
to a long-term charter agreement. The main terms of the agreement
include a charter period for approximately 48 to 60 months at a
gross charter-out rate of $19,150 ($18,911 net) plus
additional $2,740 net per day for 36 months upon scrubber
installation. The charter is expected to commence in the first
quarter of 2019. |
|
- Navios Mars, 2016-built Capesize
|
In September 2018,
Navios Partners fixed the Navios Mars, a 2016-built Capesize vessel
to a long-term charter agreement. The main terms of the agreement
include a charter period for approximately 34 to 40 months at a
gross charter-out rate of $23,800 ($22,610 net). The charter
is expected to commence in the first quarter of 2019. |
|
- Navios Sphera, 2016-built Panamax
|
In August 2018, Navios
Partners fixed the Navios Sphera, a 2016-built Panamax vessel to a
long-term charter agreement. The main terms of the agreement
include a charter period of approximately 26 to 29 months at a
gross charter-out rate of 123% average BPI 4TC until January 2019
and 120% average BPI 4TC thereafter until the charter
expiration. |
|
- Navios Hope, 2005-built Panamax
|
In July 2018, Navios
Partners fixed the Navios Hope, a 2005-built Panamax vessel to a
long-term charter agreement. The main terms of the agreement
include a charter period of approximately 25 to 28 months at a
gross charter-out rate of 100% average BPI 4TC. |
|
- Navios Helios, 2005-built Panamax
|
In July 2018, Navios
Partners fixed the Navios Helios, a 2005-built Panamax vessel to a
long-term charter agreement. The main terms of the agreement
include a charter period of approximately 23 to 26 months at a
gross charter-out rate of 100% average BPI 4TC. |
|
- Navios Sun, 2005-built Panamax
|
In July 2018, Navios
Partners fixed the Navios Sun, a 2005-built Panamax vessel to a
long-term charter agreement. The main terms of the agreement
include a charter period of approximately 23 to 29 months at a
gross charter-out rate of 100% average BPI 4TC. |
|
Long-Term Cash Flow
Navios Partners has entered into medium to
long-term time charter-out agreements for its vessels with a
remaining average term of approximately 2.0 years. Navios Partners
has currently contracted out 97.8% of its available days for 2018,
45.8% for 2019 and 31.5% for 2020, including index-linked charters,
expecting to generate revenues (excluding index-linked charters) of
approximately $196.9 million, $81.8 million and $81.3 million,
respectively. The average expected daily charter-out rate for the
fleet is $15,942, $22,265 and $27,774 for 2018, 2019 and 2020,
respectively.
EARNINGS HIGHLIGHTS
For the following results and the selected
financial data presented herein, Navios Partners has compiled
consolidated statements of operations for the three and nine month
periods ended September 30, 2018 and 2017. The quarterly
information was derived from the unaudited condensed consolidated
financial statements for the respective periods. Adjusted EBITDA,
Adjusted Earnings per Common unit, Adjusted Net Income and
Operating Surplus are non-GAAP financial measures and should not be
used in isolation or substitution for Navios Partners’ results
calculated in accordance with U.S. generally accepted accounting
principles (“U.S. GAAP”).
EARNINGS HIGHLIGHTS
For the following results and the selected
financial data presented herein, Navios Partners has compiled
consolidated statements of operations for the three and nine month
periods ended September 30, 2018 and 2017. The quarterly
information was derived from the unaudited condensed consolidated
financial statements for the respective periods. Adjusted EBITDA,
Adjusted Earnings per Common unit, Adjusted Net Income and
Operating Surplus are non-GAAP financial measures and should not be
used in isolation or substitution for Navios Partners’ results
calculated in accordance with U.S. generally accepted accounting
principles (“U.S. GAAP”).
As of August 29, 2017, Navios Containers was no
longer consolidated and commenced being accounted for under the
equity method of accounting. As Navios Containers had operations
during the three and nine month periods ended September 30, 2017,
the table below includes the impact of Navios Containers in the
consolidated financial results and selected financial data for such
periods.
|
Three Month |
Three Month |
Nine Month |
Nine Month |
|
Period Ended |
Period Ended |
Period Ended |
Period Ended |
|
September
30,2018 |
September
30,2017 |
September
30,2018 |
September
30,2017 |
(in $‘000
except per unit data) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
Revenue |
$ |
62,571 |
|
$ |
59,954 |
|
$ |
173,819 |
|
$ |
152,383 |
|
Net income/ (loss) |
$ |
10,457 |
|
$ |
9,173 |
|
$ |
(13,598 |
) |
$ |
7,965 |
|
Adjusted Net
Income |
$ |
16,342 |
(1) |
$ |
6,143 |
(4) |
$ |
31,591 |
(2) |
$ |
11,423 |
(5) |
Net cash provided by
operating activities |
$ |
19,394 |
|
$ |
27,480 |
|
$ |
50,648 |
|
$ |
37,564 |
|
EBITDA |
$ |
36,096 |
|
$ |
41,006 |
|
$ |
63,182 |
|
$ |
95,405 |
|
Adjusted EBITDA |
$ |
41,981 |
(1) |
$ |
37,859 |
(4) |
$ |
108,162 |
(3) |
$ |
95,947 |
(6) |
Earnings/ (Loss) per
Common unit (basic and diluted) |
$ |
0.06 |
|
$ |
0.06 |
|
$ |
(0.08 |
) |
$ |
0.06 |
|
Adjusted Earnings per
Common unit (basic and diluted) |
$ |
0.10 |
(1) |
$ |
0.04 |
(4) |
$ |
0.19 |
(2) |
$ |
0.09 |
(5) |
Operating Surplus |
$ |
25,791 |
|
$ |
27,193 |
|
$ |
63,034 |
|
$ |
67,110 |
|
Maintenance and
Replacement Capital expenditure reserve |
$ |
7,399 |
|
$ |
4,061 |
|
$ |
19,818 |
|
$ |
10,801 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjusted Net Income, Adjusted EBITDA and Adjusted Earnings
per Common unit for the three month period ended September 30, 2018
have been adjusted to exclude a $5.3 million impairment loss
related to the sale of one vessel and a $0.6 million equity
compensation expense.
(2) Adjusted Net Income and Adjusted Earnings per Common unit
for the nine month period ended September 30, 2018 have been
adjusted to exclude a $43.1 million impairment loss related to the
sale of three of our vessels, a $1.9 million equity compensation
expense and a $0.2 million write-off of deferred finance fees
related to $20.2 million debt repayment in the third quarter of
2018.
(3) Adjusted EBITDA for the nine month period ended September
30, 2018 has been adjusted to exclude a $43.1 million impairment
loss related to the sale of three of our vessels and a $1.9 million
equity compensation expense.
(4) Adjusted Net Income, Adjusted EBITDA and Adjusted Earnings
per Common unit for the three month period ended September 30, 2017
have been adjusted to exclude a $4.1 million gain on change in
control from Navios Containers’ deconsolidation, a $0.5 million
equity compensation expense and a $0.4 million relating to the
reactivation costs of four laid-up vessels of Navios
Containers.
(5) Adjusted Net Income and Adjusted Earnings per Common unit
for the nine month period ended September 30, 2017 have been
adjusted to exclude a $4.1 million gain on change in control from
Navios Containers’ deconsolidation, a $3.2 million write-off of
deferred finance fees and discount related to the refinancing of
the Term Loan B Facility, a $1.5 million allowance for doubtful
accounts, a $1.3 million loss related to the disposal of one of our
vessels, a $1.4 million equity compensation expense and a $0.4
million relating to the reactivation costs of four laid-up vessels
of Navios Containers.
(6) Adjusted EBITDA for the nine month period ended September
30, 2017 has been adjusted to exclude a $4.1 million gain on change
in control from Navios Containers’ deconsolidation, a $1.5 million
allowance for doubtful accounts, a $1.3 million loss related to the
disposal of one of our vessels, a $1.4 million equity compensation
expense and a $0.4 million relating to the reactivation costs of
four laid-up vessels of Navios Containers.
Three month periods ended September
30, 2018 and 2017
The details below exclude the impact of the
consolidation of Navios Containers for the periods presented as it
is intended to provide investors with a clearer picture of Navios
Partners on a going forward basis. Navios Containers’ effect on
time charter and voyage revenues and adjusted EBITDA for the period
from July 1, 2017 to August 29, 2017 was $9.3 million and $4.4
million, respectively.
Time charter and voyage revenues for Navios
Partners for the three month period ended September 30, 2018
increased by $11.9 million, or 23.4%, to $62.6 million,
as compared to $50.7 million for the same period in 2017. The
increase in time charter and voyage revenues was mainly
attributable to: (i) the increase in revenue following the
acquisition of five vessels in 2017 and five vessels in 2018; and
(ii) the increase in the time charter equivalent rate, or TCE
rate, to $17,606 per day for the three month period ended September
30, 2018, from $15,588 per day for the three month period ended
September 30, 2017 due to the increase in the freight market. That
increase was partially mitigated by the decrease in revenue due to
the sales of the Navios Gemini S in 2017 and the YM Unity and the
YM Utmost in 2018. The available days of the fleet increased to
3,428 days for the three month period ended September 30,
2018, as compared to 3,178 days for the three month period ended
September 30, 2017, mainly due to the increased size of the
fleet.
EBITDA of Navios Partners for the three month
period ended September 30, 2018 was negatively affected by the
accounting effect of a: (i) $5.3 million impairment loss on the
sale of the Navios Felicity; and (ii) $0.6 million equity
compensation expense. EBITDA of Navios Partners for the three month
period ended September 30, 2017 was negatively affected by the
accounting effect of a $0.5 million equity compensation expense.
Excluding these items, Adjusted EBITDA increased by $8.7 million to
$42.0 million for the three month period ended September 30,
2018, as compared to $33.3 million for the same period in 2017. The
increase in Adjusted EBITDA was primarily due to: (i) an $11.9
million increase in revenue; and (ii) a $1.9 million increase in
equity in net earnings of affiliated companies. The above increase
was partially mitigated by a: (i) $1.1 million increase in time
charter and voyage expenses; (ii) $0.9 million increase in
management fees due to the increased fleet; (iii) $3.0 million
decrease in other income; and (iv) $0.1 million increase in other
expenses.
The reserves for estimated maintenance and
replacement capital expenditures for the three month periods ended
September 30, 2018 and 2017 were $7.4 million and $4.1 million,
respectively (please see “Reconciliation of Non-GAAP Financial
Measures” in Exhibit 3).
Navios Partners generated an operating surplus
for the three month period ended September 30, 2018 of
$25.8 million, as compared to $27.2 million for the three
month period ended September 30, 2017. Operating Surplus is a
non-GAAP financial measure used by certain investors to assist in
evaluating a partnership’s ability to make quarterly cash
distributions (please see “Reconciliation of Non-GAAP Financial
Measures” in Exhibit 3).
Net Income of Navios Partners for the three
month period ended September 30, 2018 was negatively affected by
the accounting effect of a: (i) $5.3 million impairment loss on the
sale of the Navios Felicity; and (ii) $0.6 million equity
compensation expense. Net Income of Navios Partners for the three
month period ended September 30, 2017 was negatively affected by
the accounting effect of a $0.5 million equity compensation
expense. Excluding these items, Adjusted Net Income for the three
month period ended September 30, 2018 amounted to $16.3 million
compared to $5.9 million for the three month period ended September
30, 2017. The increase in Adjusted Net Income of $10.5 million was
due to: (i) an $8.7 million increase in adjusted EBITDA; (ii) a
$0.2 million decrease in direct vessel expenses; (iii) a $3.0
million decrease in depreciation and amortization expense; and (iv)
a $0.1 million increase in interest income. The above increase was
partially mitigated by a $1.4 million increase in interest expense
and finance cost, net.
Nine month periods ended September 30,
2018 and 2017
The details below exclude the impact of the
consolidation of Navios Containers for the periods presented as it
is intended to provide investors with a clearer picture of Navios
Partners on a going forward basis. Navios Containers’ effect on
time charter and voyage revenues and adjusted EBITDA for the period
from April 28, 2017 (date of inception) to August 29, 2017 was
$12.4 million and $6.7 million, respectively.
Time charter and voyage revenues for Navios
Partners for the nine month period ended September 30, 2018
increased by $33.8 million, or 24.1%, to $173.8 million,
as compared to $140.0 million for the same period in 2017. The
increase in time charter and voyage revenues was mainly
attributable to: (i) the increase in revenue following the
acquisition of seven vessels in 2017 and five vessels in 2018; and
(ii) the increase in the TCE rate to $16,745 per day for the nine
month period ended September 30, 2018, from $15,591 per day for the
nine month period ended September 30, 2017 due to the increase in
the freight market. That increase was partially mitigated by the
decrease in revenue due to the sales of the MSC Cristina, the
Navios Apollon and the Navios Gemini S in 2017 and the YM Unity and
the YM Utmost in 2018. The available days of the fleet increased to
9,980 days for the nine month period ended September 30, 2018,
as compared to 8,817 days for the nine month period ended
September 30, 2017, mainly due to the increased fleet.
EBITDA of Navios Partners for the nine month
period ended September 30, 2018 was negatively affected by the
accounting effect of a: (i) $37.9 million impairment loss on the
sale of the YM Unity and the YM Utmost; (ii) $5.3 million
impairment loss on the sale of the Navios Felicity; and (iii) $1.9
million equity compensation expense. EBITDA of Navios Partners for
the nine month period ended September 30, 2017 was negatively
affected by the accounting effect of a: (i) $4.1 million gain on
change in control from Navios Containers’ deconsolidation; (ii)
$1.5 million allowance for doubtful accounts; (iii) $1.3 million
loss related to the sale of the MSC Cristina; and (iv) $1.4 million
equity compensation expense. Excluding these items, Adjusted EBITDA
increased by $18.7 million to $108.2 million for the nine month
period ended September 30, 2018, as compared to $89.5 million for
the same period in 2017. The increase in Adjusted EBITDA was
primarily due to a: (i) $33.8 million increase in revenue; and (ii)
$4.5 million increase in equity in net earnings of affiliated
companies. The above increase was partially mitigated by a: (i)
$4.1 million increase in time charter and voyage expenses;
(ii) $5.9 million increase in management fees due to the increased
fleet; (iii) $0.8 million increase in general and administrative
expenses; (iv) $8.4 million decrease in other income; and (v) $0.4
million increase in other expenses.
The reserves for estimated maintenance and
replacement capital expenditures for the nine month periods ended
September 30, 2018 and 2017 were $19.8 million and $10.8
million, respectively (please see “Reconciliation of Non-GAAP
Financial Measures” in Exhibit 3).
Navios Partners generated an operating surplus
for the nine month period ended September 30, 2018 of
$63.0 million, compared to $67.1 million for the nine
month period ended September 30, 2017. Operating Surplus is a
non-GAAP financial measure used by certain investors to assist in
evaluating a partnership’s ability to make quarterly cash
distributions (please see “Reconciliation of Non-GAAP Financial
Measures” in Exhibit 3).
Net Income of Navios Partners for the nine month
period ended September 30, 2018 was negatively affected by the
accounting effect of a: (i) $37.9 million impairment loss on the
sale of the YM Unity and the YM Utmost; (ii) $5.3 million
impairment loss on the sale of the Navios Felicity; (iii) $1.9
million equity compensation expense; and (iv) $0.2 million
write-off of deferred finance fees. Net Income of Navios Partners
for the nine month period ended September 30, 2017 was negatively
affected by the accounting effect of a: (i) $4.1 million gain on
change in control from Navios Containers’ deconsolidation; (ii)
$3.2 million write-off of deferred finance fees and discount
related to the refinancing of the Term Loan B Facility; (iii) $1.5
million allowance for doubtful accounts; (iv) $1.3 million loss
related to the sale of the MSC Cristina; and (v) $1.4 million
equity compensation expense. Excluding these items, Adjusted Net
Income for the nine month period ended September 30, 2018 amounted
to $31.6 million compared to $10.6 million for the nine month
period ended September 30, 2017. The increase in Adjusted Net
Income of $21.0 million was due to: (i) an $18.7 million increase
in Adjusted EBITDA; (ii) a $0.4 million decrease in direct vessel
expenses; (iii) a $7.8 million decrease in depreciation and
amortization expense; and (iv) a $0.6 million increase in interest
income. The above increase was partially mitigated by a $6.5
million increase in interest expense and finance cost, net.
Fleet Employment Profile
The following table reflects certain key
indicators of Navios Partners’ core fleet performance for the three
and nine month periods ended September 30, 2018 and 2017
(excluding Navios Containers).
|
Three Month Period
EndedSeptember 30, 2018 (unaudited) |
|
|
Three Month Period
EndedSeptember 30, 2017 (unaudited) |
|
|
Nine
Month Period EndedSeptember 30, 2018 (unaudited) |
|
|
Nine
Month Period EndedSeptember 30, 2017 (unaudited) |
|
Available Days(1) |
|
3,428 |
|
|
|
3,178 |
|
|
|
9,980 |
|
|
|
8,817 |
|
Operating Days(2) |
|
3,389 |
|
|
|
3,165 |
|
|
|
9,875 |
|
|
|
8,775 |
|
Fleet
Utilization(3) |
|
98.9 |
% |
|
|
99.6 |
% |
|
|
98.9 |
% |
|
|
99.5 |
% |
Time Charter Equivalent
Combined (per day) (4) |
$ |
17,606 |
|
|
$ |
15,588 |
|
|
$ |
16,745 |
|
|
$ |
15,591 |
|
Time Charter Equivalent
Drybulk (per day) (4) |
$ |
15,559 |
|
|
$ |
11,547 |
|
|
$ |
13,658 |
|
|
$ |
10,893 |
|
Time Charter Equivalent
Containers (per day) (4) |
$ |
30,687 |
|
|
$ |
31,487 |
|
|
$ |
31,458 |
|
|
$ |
31,845 |
|
Vessels operating at
period end |
|
39 |
|
|
|
37 |
|
|
|
39 |
|
|
|
37 |
|
(1) Available days for the fleet represent total calendar
days the vessels were in Navios Partners’ possession for the
relevant period after subtracting off-hire days associated with
scheduled repairs, dry dockings or special surveys and ballast days
relating to voyages. The shipping industry uses available days to
measure the number of days in a relevant period during which a
vessel is 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
Partners’ vessels were available for revenue generating available
days, 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 efficiency in finding employment for vessels and minimizing
the amount of days that its vessels are off-hire for reasons other
than scheduled repairs, dry dockings or special surveys.
(4) TCE rate: Time Charter Equivalent rate per day is
defined as voyage and time charter revenues less voyage expenses
during a period divided by the number of available days during the
period. The TCE rate per day is a standard shipping industry
performance measure used primarily to present the actual daily
earnings generated by vessels on various types of charter contracts
for the number of available days of the fleet.
Conference Call Details:
Navios Partners' management will host a
conference call today, Tuesday, November 13, 2018 to discuss the
results for the third quarter and nine months ended September 30,
2018.
Call Date/Time: Tuesday, November 13, 2018 at 8:30 am ET Call
Title: Navios Partners Q3 2018 Financial Results Conference Call US
Dial In: +1.866.394.0817 International Dial In:
+1.706.679.9759Conference ID: 815 8118The conference call replay
will be available two hours after the live call and remain
available for one week at the following numbers:
US Replay Dial In: +1.800.585.8367International Replay Dial In:
+1.404.537.3406 Conference ID: 815 8118
Slides and audio webcast:
There will also be a live webcast of the
conference call, through the Navios Partners website
(www.navios-mlp.com) under “Investors”. Participants to the live
webcast should register on the website approximately 10 minutes
prior to the start of the webcast.
A supplemental slide presentation will be
available on the Navios Partners’ website under the "Investors"
section by 8:00 am ET on the day of the call.
About Navios Maritime Partners
L.P.
Navios Maritime Partners L.P. (NYSE: NMM) is a
publicly traded master limited partnership which owns and operates
dry cargo vessels. For more information, please visit our website
at www.navios-mlp.com.
Forward-Looking Statements
This press release contains forward-looking statements (as
defined in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended)
concerning future events including Navios Partners’ 2018 cash flow
generation, future contracted revenues, future distributions and
its ability to have a dividend going forward, opportunities to
reinvest cash accretively in a fleet renewal program or otherwise,
potential capital gains, our ability to take advantage of
dislocation in the market and Navios Partners’ growth strategy and
measures to implement such strategy; including expected vessel
acquisitions 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.
Such statements include comments regarding expected revenue and
time charters.
These forward-looking statements are based on the information
available to, and the expectations and assumptions deemed
reasonable by Navios Partners at the time these statements were
made. Although Navios Partners 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 Partners. 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,
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 dry cargo shipping sector in general and the demand
for our Panamax, Capesize, Ultra Handymax and Container vessels in
particular, fluctuations in charter rates for dry cargo carriers
and container 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, 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 Partners
operates; risks associated with operations outside the United
States; and other factors listed from time to time in Navios
Partners’ filings with the Securities and Exchange Commission,
including its Form 20- Fs and Form 6- Ks. Navios Partners 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 Partners’ expectations with
respect thereto or any change in events, conditions or
circumstances on which any statement is based. Navios Partners
makes no prediction or statement about the performance of its
common units.
Contacts
Navios Maritime Partners L.P.+1 (212) 906
8645Investors@navios-mlp.com
Nicolas BornozisCapital Link, Inc.+1 (212) 661
7566naviospartners@capitallink.com
EXHIBIT 1
NAVIOS MARITIME PARTNERS L.P. SELECTED
BALANCE SHEET DATA(Expressed in thousands of U.S. Dollars
except unit data)
|
|
|
|
September 30,
2018 (unaudited) |
|
December 31, 2017
(unaudited) |
|
|
|
ASSETS |
|
|
Cash and cash
equivalents, including restricted cash |
$ |
58,322 |
|
$ |
29,933 |
Vessels, net |
|
1,065,698 |
|
|
1,099,015 |
Other assets (including
current and non-current) |
|
199,571 |
|
|
168,274 |
Intangible assets |
|
5,032 |
|
|
8,080 |
|
|
|
Total
assets |
$ |
1,328,623 |
|
$ |
1,305,302 |
|
|
|
LIABILITIES AND
PARTNERS’ CAPITAL |
|
|
Other current
liabilities |
$ |
26,251 |
|
$ |
27,661 |
Current portion of
long-term debt, net |
|
27,824 |
|
|
26,586 |
Long-term debt,
net |
|
483,845 |
|
|
466,877 |
Other non-current
liabilities |
|
7,417 |
|
|
16,468 |
Total partners’
capital |
|
783,286 |
|
|
767,710 |
|
|
|
Total
liabilities and partners’ capital |
$ |
1,328,623 |
|
$ |
1,305,302 |
|
|
|
NAVIOS MARITIME PARTNERS
L.P.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Expressed in thousands of U.S. Dollars except
unit and per unit data)
|
|
|
|
|
|
Three Month Period Ended
September 30, 2018 (unaudited) |
|
Three Month Period Ended
September 30, 2017 (unaudited) |
|
Nine Month Period Ended
September 30, 2018 (unaudited) |
|
Nine Month Period Ended
September 30, 2017 (unaudited) |
Time charter and voyage
revenues |
$ |
62,571 |
|
|
$ |
59,954 |
|
|
$ |
173,819 |
|
|
$ |
152,383 |
|
Time charter and voyage
expenses |
|
(2,217 |
) |
|
|
(1,402 |
) |
|
|
(6,705 |
) |
|
|
(2,815 |
) |
Direct vessel
expenses |
|
(1,516 |
) |
|
|
(2,190 |
) |
|
|
(4,685 |
) |
|
|
(5,523 |
) |
Management fees
(entirely through related parties transactions) |
|
(17,220 |
) |
|
|
(20,284 |
) |
|
|
(51,292 |
) |
|
|
(50,089 |
) |
General and
administrative expenses |
|
(3,490 |
) |
|
|
(3,888 |
) |
|
|
(12,534 |
) |
|
|
(11,965 |
) |
Depreciation and
amortization |
|
(14,543 |
) |
|
|
(21,083 |
) |
|
|
(43,815 |
) |
|
|
(56,538 |
) |
Vessel impairment
losses |
|
(5,258 |
) |
|
|
— |
|
|
|
(43,118 |
) |
|
|
— |
|
Interest expense and
finance cost, net |
|
(10,739 |
) |
|
|
(9,882 |
) |
|
|
(31,386 |
) |
|
|
(28,382 |
) |
Interest income |
|
1,159 |
|
|
|
990 |
|
|
|
3,106 |
|
|
|
2,316 |
|
Gain on change in
control |
|
— |
|
|
|
4,068 |
|
|
|
— |
|
|
|
4,068 |
|
Other income |
|
160 |
|
|
|
3,180 |
|
|
|
880 |
|
|
|
9,250 |
|
Other expense |
|
(398 |
) |
|
|
(349 |
) |
|
|
(2,470 |
) |
|
|
(4,799 |
) |
Equity in net earnings
of affiliated companies |
|
1,948 |
|
|
|
59 |
|
|
|
4,602 |
|
|
|
59 |
|
|
|
|
|
|
|
|
|
Net
income/ (loss) |
$ |
10,457 |
|
|
$ |
9,173 |
|
|
$ |
(13,598 |
) |
|
$ |
7,965 |
|
|
|
|
|
|
|
|
|
Less: Net loss/
(income) attributable to the noncontrolling interest |
|
— |
|
|
$ |
116 |
|
|
|
— |
|
|
$ |
(239 |
) |
|
|
|
|
|
|
|
|
Net income/
(loss) attributable to Navios Partners unitholders |
$ |
10,457 |
|
|
$ |
9,289 |
|
|
$ |
(13,598 |
) |
|
$ |
7,726 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per unit:
|
|
Three Month
Period Ended September 30,
2018 (unaudited) |
|
|
Three Month
Period Ended September 30,
2017 (unaudited) |
|
Nine Month
Period Ended September 30,
2018 (unaudited) |
|
Nine Month
Period Ended September 30,
2017 (unaudited) |
|
|
|
|
|
|
|
|
|
|
Earnings/ (loss) per
unit: |
|
|
|
|
|
|
|
|
|
Common unit (basic and
diluted) |
$ |
0.06 |
|
$ |
0.06 |
|
$ |
(0.08 |
) |
|
$ |
0.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NAVIOS MARITIME PARTNERS
L.P.Other Financial Information(Expressed
in thousands of U.S. Dollars except unit data)
|
|
|
|
Nine Month Period Ended
September 30, 2018 (Unaudited) |
|
|
Nine Month Period Ended September 30, 2017
(Unaudited) |
|
Net cash provided by
operating activities |
$ |
50,648 |
|
|
$ |
37,564 |
|
Net cash used in
investing activities |
|
(62,451 |
) |
|
|
(179,526 |
) |
Net cash provided by
financing activities |
|
40,192 |
|
|
|
148,235 |
|
|
|
|
Net increase in
cash, cash equivalents and restricted cash |
$ |
28,389 |
|
|
$ |
6,273 |
|
|
|
|
EXHIBIT 2
Owned
Drybulk Vessels |
|
Type |
|
Built |
|
Capacity(DWT) |
Navios Soleil |
|
Ultra-Handymax |
|
2009 |
|
57,337 |
Navios La Paix |
|
Ultra-Handymax |
|
2014 |
|
61,485 |
Navios Christine B |
|
Ultra-Handymax |
|
2009 |
|
58,058 |
Navios Libra II(1) |
|
Panamax |
|
1995 |
|
70,136 |
Navios Felicity(1) |
|
Panamax |
|
1997 |
|
73,867 |
Navios Galaxy I |
|
Panamax |
|
2001 |
|
74,195 |
Navios Hyperion |
|
Panamax |
|
2004 |
|
75,707 |
Navios Alegria |
|
Panamax |
|
2004 |
|
76,466 |
Navios Orbiter |
|
Panamax |
|
2004 |
|
76,602 |
Navios Helios |
|
Panamax |
|
2005 |
|
77,075 |
Navios Hope |
|
Panamax |
|
2005 |
|
75,397 |
Navios Sun |
|
Panamax |
|
2005 |
|
76,619 |
Navios Sagittarius |
|
Panamax |
|
2006 |
|
75,756 |
Navios Harmony |
|
Panamax |
|
2006 |
|
82,790 |
Navios Prosperity
I |
|
Panamax |
|
2007 |
|
75,527 |
Navios Libertas |
|
Panamax |
|
2007 |
|
75,511 |
Navios Symmetry |
|
Panamax |
|
2006 |
|
74,381 |
Navios Apollon I |
|
Panamax |
|
2005 |
|
87,052 |
Navios Altair I |
|
Panamax |
|
2006 |
|
74,475 |
Navios Sphera |
|
Panamax |
|
2016 |
|
84,872 |
Navios Fantastiks |
|
Capesize |
|
2005 |
|
180,265 |
Navios Aurora II |
|
Capesize |
|
2009 |
|
169,031 |
Navios Pollux |
|
Capesize |
|
2009 |
|
180,727 |
Navios Fulvia |
|
Capesize |
|
2010 |
|
179,263 |
Navios Melodia |
|
Capesize |
|
2010 |
|
179,132 |
Navios Luz |
|
Capesize |
|
2010 |
|
179,144 |
Navios Buena
Ventura |
|
Capesize |
|
2010 |
|
179,259 |
Navios Joy |
|
Capesize |
|
2013 |
|
181,389 |
Navios Beaufiks |
|
Capesize |
|
2004 |
|
180,310 |
Navios Ace |
|
Capesize |
|
2011 |
|
179,016 |
Navios Sol |
|
Capesize |
|
2009 |
|
180,274 |
Navios Symphony |
|
Capesize |
|
2010 |
|
178,132 |
Navios Aster |
|
Capesize |
|
2010 |
|
179,314 |
Navios Mars |
|
Capesize |
|
2016 |
|
181,259 |
Chartered-in vessel to be delivered |
|
Type |
|
Built |
|
Capacity(DWT) |
|
Delivery Date |
Navios TBN I |
|
Panamax |
|
2019 |
|
81,000 |
|
H2 2019 |
Owned Containerships |
|
Type |
|
Built |
|
Capacity(TEU) |
|
|
|
|
|
|
|
Hyundai Hongkong |
|
Container |
|
2006 |
|
6,800 |
Hyundai Singapore |
|
Container |
|
2006 |
|
6,800 |
Hyundai Tokyo |
|
Container |
|
2006 |
|
6,800 |
Hyundai Shanghai |
|
Container |
|
2006 |
|
6,800 |
Hyundai Busan |
|
Container |
|
2006 |
|
6,800 |
(1) Includes the Navios Libra II and the Navios Felicity
expected to be sold by the end of 2018.
EXHIBIT 3
Disclosure of Non-GAAP Financial
Measures
1. EBITDA and Adjusted
EBITDA
EBITDA represents net income/ (loss)
attributable to Navios Partners’ unitholders before interest and
finance costs, before depreciation and amortization (including
intangible accelerated amortization) and income taxes. Adjusted
EBITDA represents EBITDA before equity compensation expense, loss
on sale of vessel, impairment losses and allowance for doubtful
accounts, reactivation costs and gain on change in control. Navios
Partners uses Adjusted EBITDA as a liquidity measure and reconcile
EBITDA and Adjusted EBITDA to net cash provided by/(used in)
operating activities, the most comparable U.S. GAAP liquidity
measure. EBITDA in this document is calculated as follows: net cash
provided by/(used in) operating activities adding back, when
applicable and as the case may be, the effect of: (i) net
(increase)/decrease in operating assets; (ii) net
(decrease)/increase in operating liabilities; (iii) net
interest cost; (iv) amortization and write-off of deferred
finance charges and other related expenses; (v) allowance for
doubtful accounts; (vi) equity in net earnings of affiliated
companies; (vii) payments for drydock and special survey
costs; (viii) gain/(loss) on sale of assets/subsidiaries;
(ix) impairment charges; (x) non-cash accrued interest
income and amortization of deferred revenue; (xi) gain/(loss)
on debt repayments; (xii) equity compensation expense; (xiii)
gain on change in control; (xiv) noncontrolling interest; and (xv)
non-cash accrued interest income from receivable from affiliates.
Navios Partners believes that EBITDA and Adjusted EBITDA are each
the basis upon which liquidity can be assessed and presents useful
information to investors regarding Navios Partners’ ability to
service and/or incur indebtedness, pay capital expenditures, meet
working capital requirements and make cash distributions. Navios
Partners also believes that EBITDA and Adjusted EBITDA are used:
(i) by 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.
Adjusted EBITDA represents EBITDA excluding
certain items, as described under “Earnings Highlights.”
EBITDA and Adjusted EBITDA have limitations as
an analytical tool, and should not be considered in isolation or as
a substitute for the analysis of Navios Partners’ results as
reported under U.S. GAAP. Some of these limitations are:
(i) EBITDA and Adjusted EBITDA do not reflect changes in, or
cash requirements for, working capital needs; and
(ii) although depreciation and amortization are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future. EBITDA and Adjusted EBITDA do not reflect
any cash requirements for such capital expenditures. Because of
these limitations, EBITDA and Adjusted EBITDA should not be
considered as a principal indicator of Navios Partners’
performance. Furthermore, our calculation of EBITDA and Adjusted
EBITDA may not be comparable to that reported by other companies
due to differences in methods of calculation.
2. Operating Surplus
Operating Surplus represents net income adjusted
for depreciation and amortization expense, non-cash interest
expense, estimated maintenance and replacement capital expenditures
and one-off items. Maintenance and replacement capital expenditures
are those capital expenditures required to maintain over the long
term the operating capacity of, or the revenue generated by, Navios
Partners’ capital assets.
Operating Surplus is a quantitative measure used
in the publicly-traded partnership investment community to assist
in evaluating a partnership’s ability to make quarterly cash
distributions. Operating Surplus is not required by accounting
principles generally accepted in the United States and should not
be considered a substitute for net income, cash flow from operating
activities and other operations or cash flow statement data
prepared in accordance with accounting principles generally
accepted in the United States or as a measure of profitability or
liquidity.
3. Available Cash
Available Cash generally means for each fiscal
quarter, all cash on hand at the end of the quarter:
- less the amount of cash reserves established by the Board of
Directors to: • provide for the proper conduct of
Navios Partners’ business (including reserve for maintenance and
replacement capital expenditures); • comply with
applicable law, any of Navios Partners’ debt instruments, or other
agreements; or • provide funds for distributions
to the unitholders and to the general partner for any one or more
of the next four quarters;
- plus all cash on hand on the date of determination of available
cash for the quarter resulting from working capital borrowings made
after the end of the quarter. Working capital borrowings are
generally borrowings that are made under any revolving credit or
similar agreement used solely for working capital purposes or to
pay distributions to partners.
Available Cash is a quantitative measure used in the
publicly-traded partnership investment community to assist in
evaluating a partnership’s ability to make quarterly cash
distributions. Available cash is not required by accounting
principles generally accepted in the United States and should not
be considered a substitute for net income, cash flow from operating
activities and other operations or cash flow statement data
prepared in accordance with accounting principles generally
accepted in the United States or as a measure of profitability or
liquidity.
4. Reconciliation of
Non-GAAP Financial Measures
|
|
Three MonthPeriod EndedSeptember 30, 2018($
‘000)(unaudited) |
|
Three MonthPeriod EndedSeptember 30, 2017($
‘000)(unaudited) |
|
Nine
MonthPeriod EndedSeptember 30, 2018($
‘000)(unaudited) |
|
|
Nine
MonthPeriod EndedSeptember 30, 2017($
‘000)(unaudited) |
Net cash provided by
operating activities |
$ |
19,394 |
|
|
$ |
27,480 |
(2) |
|
$ |
50,648 |
|
|
$ |
37,564 |
(2) |
Net increase in
operating assets |
|
9,178 |
|
|
|
2,533 |
(2) |
|
|
18,981 |
|
|
|
26,299 |
(2) |
Net increase/
(decrease) in operating liabilities |
|
349 |
|
|
|
(3,142 |
) |
|
|
1,410 |
|
|
|
4,222 |
|
Net interest cost |
|
9,580 |
|
|
|
8,890 |
|
|
|
28,280 |
|
|
|
26,065 |
|
Amortization and
write-off of deferred financing cost |
|
(1,694 |
) |
|
|
(1,806 |
) |
|
|
(5,325 |
) |
|
|
(7,965 |
) |
Non cash accrued
interest income and amortization of deferred revenue |
|
3,156 |
|
|
|
3,153 |
|
|
|
9,364 |
|
|
|
9,357 |
|
Equity compensation
expense |
|
(627 |
) |
|
|
(474 |
) |
|
|
(1,862 |
) |
|
|
(1,408 |
) |
Gain on change in
control |
|
— |
|
|
|
4,068 |
|
|
|
— |
|
|
|
4,068 |
|
Vessels impairment
loss |
|
(5,258 |
) |
|
|
— |
|
|
|
(43,118 |
) |
|
|
— |
|
Non cash accrued
interest income from receivable from affiliates |
|
70 |
|
|
|
65 |
|
|
|
202 |
|
|
|
138 |
|
Allowance for doubtful
accounts |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,495 |
) |
Loss on vessel
disposal |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,260 |
) |
Noncontrolling
interest |
|
— |
|
|
|
116 |
|
|
|
— |
|
|
|
(239 |
) |
Equity in earnings of
affiliates, net of dividends received |
|
1,948 |
|
|
|
123 |
|
|
|
4,602 |
|
|
|
59 |
|
EBITDA(1) |
$ |
36,096 |
|
|
$ |
41,006 |
|
|
$ |
63,182 |
|
|
$ |
95,405 |
|
Allowance for doubtful
accounts |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,495 |
|
Loss on vessel
disposal |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,260 |
|
Equity compensation
expense |
|
627 |
|
|
|
474 |
|
|
|
1,862 |
|
|
|
1,408 |
|
Reactivation cost |
|
— |
|
|
|
447 |
|
|
|
— |
|
|
|
447 |
|
Gain on change in
control |
|
— |
|
|
|
(4,068 |
) |
|
|
— |
|
|
|
(4,068 |
) |
Vessels impairment
loss |
|
5,258 |
|
|
|
— |
|
|
|
43,118 |
|
|
|
— |
|
Adjusted
EBITDA |
$ |
41,981 |
|
|
$ |
37,859 |
|
|
$ |
108,162 |
|
|
$ |
95,947 |
|
Cash interest
income |
|
215 |
|
|
|
439 |
|
|
|
546 |
|
|
|
809 |
|
Cash interest paid |
|
(9,006 |
) |
|
|
(7,044 |
) |
|
|
(25,856 |
) |
|
|
(18,845 |
) |
Maintenance and
replacement capital expenditures |
|
(7,399 |
) |
|
|
(4,061 |
) |
|
|
(19,818 |
) |
|
|
(10,801 |
) |
Operating
Surplus |
$ |
25,791 |
|
|
$ |
27,193 |
|
|
$ |
63,034 |
|
|
$ |
67,110 |
|
Cash distribution paid
relating to the first half |
|
— |
|
|
|
— |
|
|
|
(6,840 |
) |
|
|
— |
|
Cash reserves |
|
(22,371 |
) |
|
|
(27,193 |
) |
|
|
(52,774 |
) |
|
|
(67,110 |
) |
Available cash
for distribution |
$ |
3,420 |
|
|
$ |
— |
|
|
$ |
3,420 |
|
|
$ |
— |
|
|
|
(1)
|
|
|
|
|
|
Three MonthPeriod Ended
September 30, 2018 (Unaudited) |
Three Month Period Ended
September 30, 2017 (Unaudited) |
|
Nine Month Period Ended
September 30, 2018 (Unaudited) |
|
Nine Month Period Ended
September 30, 2017 (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities |
$ |
19,394 |
|
$ |
27,480 |
|
|
$ |
50,648 |
|
$ |
37,564 |
|
Net cash used in
investing activities |
$ |
(14,050 |
) |
$ |
(167,757 |
) |
|
$ |
(62,451 |
) |
$ |
(179,526 |
) |
Net cash provided by
financing activities |
$ |
11,999 |
|
$ |
85,590 |
|
|
$ |
40,192 |
|
$ |
148,235 |
|
(2) The net cash provided by operating activities and net
increase in operating assets presented in this table have been
revised to reflect the adoption of ASU 2016-18, which was effective
beginning the first quarter ended March 31, 2018 and applied
retrospectively to the three and nine month periods ended September
30, 2017.
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