Navios Maritime Partners L.P., an international owner and operator of dry cargo vessels, today reported its financial results for the second quarter and six month periods ended June 30, 2020.
Angeliki Frangou, Chairman and Chief Executive Officer of Navios Partners, stated, “While the Pandemic greatly affected businesses, countries, and people all over the world, the Navios family continues to persevere. For the second quarter of 2020, Navios Partners reported $46.5 million in revenue and $14.3 million in Adjusted EBITDA. Navios Partners also declared a quarterly distribution of $0.05 cents per unit, representing an annual distribution of $0.20 cents per unit.”
Angeliki Frangou continued, “The pandemic’s negative effect on global economic activity can be seen in the charter rates. Year-to-date 2020, the capesize 5TC rate averaged around $9,700 per day, representing about 55% of the 2019 average of $18,000. Despite a difficult 2020, the IMF projects global GDP to increase by 5.4% in 2021 which we expect will positively affect the dry bulk trade.”
Liquidation of Navios Europe II Inc.
On June 29, 2020, the liquidation of Navios Europe II was completed and Navios Partners was allocated $2.7 million in cash and took delivery of two Ultra-Handymax and three Panamax dry bulk vessels together with assumption of loans and working capital.
Financing Arrangements
In June 2020, Navios Partners entered into a new credit facility with a commercial bank for a total amount of $29.5 million for the refinancing of five drybulk vessels that were acquired upon the liquidation of Navios Europe II. The credit facility has an amortization profile of 6.2 years, matures in June 2021 and bears interest at LIBOR plus 400 bps per annum up to December 2020 and 425 bps per annum subsequently.
In June 2020, Navios Partners entered into a new credit facility with a commercial bank for a total amount of $17.0 million for the refinancing of four containerships. The credit facility has an amortization profile of 8.0 years, matures in December 2023 and bears interest at LIBOR plus 350 bps per annum.
Cash Distribution
The Board of Directors of Navios Partners declared a cash distribution for the second quarter of 2020 of $0.05 per unit. The cash distribution is payable on August 13, 2020 to all unitholders of record as of August 10, 2020. The declaration and payment of any further dividends remain subject to the discretion of the Board of Directors and will depend on, among other things, Navios Partners’ cash requirements as measured by market opportunities and restrictions under its credit agreements and other debt obligations and such other factors as the Board of Directors may deem advisable.
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 95.0% of its available days for 2020, 41.5% for 2021 and 18.6% for 2022, including index-linked charters, expecting to generate revenues (excluding index-linked charters) of approximately $176.6 million, $93.0 million and $71.9 million, respectively. The average contracted daily charter-out rate for the fleet is $12,512, $22,529 and $28,632 for 2020, 2021 and 2022, respectively.
EARNINGS HIGHLIGHTS
For the following results and the selected financial data presented herein, Navios Partners has compiled condensed consolidated statements of operations for the three and six month periods ended June 30, 2020 and 2019. The quarterly information was derived from the unaudited condensed consolidated financial statements for the respective periods. Adjusted EBITDA, Adjusted Earnings / (Loss) per Common Unit, Adjusted Net Income / (Loss) 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 US generally accepted accounting principles (“US GAAP”).
| Three Month | Three Month | Six Month | Six Month | |||||||||||||
| Period Ended | Period Ended | Period Ended | Period Ended | |||||||||||||
| June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||
| (in $ ‘000 except per unit data) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
| Revenue | $ | 46,549 | $ | 47,745 | $ | 93,039 | $ | 94,563 | ||||||||
| Net Loss | $ | (14,641 | ) | $ | (6,523 | ) | $ | (25,365 | ) | $ | (16,046 | ) | ||||
| Adjusted Net Loss | $ | (7,841 | ) | (1) | $ | (1,401 | ) | (2) | $ | (11,665 | ) | (4) | $ | (3,579 | ) | (5) |
| Net cash provided by operating activities | $ | 26,738 | $ | 3,943 | $ | 47,675 | $ | 14,426 | ||||||||
| EBITDA | $ | 7,490 | $ | 18,699 | $ | 19,671 | $ | 34,012 | ||||||||
| Adjusted EBITDA | $ | 14,290 | (1) | $ | 22,337 | (3) | $ | 33,371 | (4) | $ | 44,995 | (6) | ||||
| Loss per Common Unit (basic and diluted) | $ | (1.32 | ) | $ | (0.59 | ) | $ | (2.29 | ) | $ | (1.44 | ) | ||||
| Adjusted Loss per Common Unit (basic and diluted) | $ | (0.71 | ) | (1) | $ | (0.13 | ) | (2) | $ | (1.05 | ) | (4) | $ | (0.32 | ) | (5) |
| Operating Surplus | $ | (1,128 | ) | $ | 6,207 | $ | 3,303 | $ | 11,909 | |||||||
| Maintenance and Replacement Capital Expenditure Reserve | $ | 8,589 | $ | 7,260 | $ | 17,179 | $ | 14,734 | ||||||||
- Adjusted EBITDA, Adjusted Net Loss and Adjusted Loss per Common Unit for the three month period ended June 30, 2020 have been adjusted to exclude a $ 6.8 million impairment loss related to three containerships.
- Adjusted Net Loss and Adjusted Loss per Common Unit for the three month period ended June 30, 2019 have been adjusted to exclude a $ 3.6 million revision of the estimated guarantee claim receivable and a $ 1.5 million write-off of deferred finance fees and discount related to the $ 73.5 million prepayments of the Term Loan B Facility in the second quarter of 2019.
- Adjusted EBITDA for the three month period ended June 30, 2019 has been adjusted to exclude a $ 3.6 million revision of the estimated guarantee claim receivable.
- Adjusted EBITDA, Adjusted Net Loss and Adjusted Loss per Common Unit for the six month period ended June 30, 2020 have been adjusted to exclude a $ 6.9 million loss related to the other-than-temporary impairment recognized in the Navios Partners’ receivable from Navios Europe II and a $ 6.8 million impairment loss related to three containerships.
- Adjusted Net Loss and Adjusted Loss per Common Unit for the six month period ended June 30, 2019 have been adjusted to exclude a $ 7.3 million impairment loss related to the sale of one of our vessels, a $ 3.6 million revision of the estimated guarantee claim receivable and a $ 1.5 million write-off of deferred finance fees and discount related to the $ 73.5 million prepayments of the Term Loan B Facility in the first half of 2019.
- Adjusted EBITDA for the six month period ended June 30, 2019 has been adjusted to exclude a $ 7.3 million impairment loss related to the sale of one of our vessels and a $ 3.6 million revision of the estimated guarantee claim receivable.
Three month periods ended June 30, 2020 and 2019
Time charter and voyage revenues for the three month period ended June 30, 2020 decreased by $ 1.2 million, or 2.5%, to $ 46.5 million, as compared to $ 47.7 million for the same period in 2019. The decrease in time charter and voyage revenues was mainly attributable to the decrease in the time charter equivalent rate, or TCE rate, to $ 11,202 per day for the three month period ended June 30, 2020, from $ 14,130 per day for the three month period ended June 30, 2019. The available days of the fleet increased to 4,029 days for the three month period ended June 30, 2020, as compared to 3,203 days for the three month period ended June 30, 2019.
EBITDA for the three month period ended June 30, 2020 was negatively affected by the accounting effect of a $ 6.8 million impairment loss related to three containerships. EBITDA for the three month period ended June 30, 2019 was negatively affected by the accounting effect of a $ 3.6 million revision of the estimated guarantee claim receivable. Excluding these items, Adjusted EBITDA decreased by $ 8.0 million to $ 14.3 million for the three month period ended June 30, 2020, as compared to $ 22.3 million for the same period in 2019. The decrease in Adjusted EBITDA was primarily due to: ( i) a $ 1.2 million decrease in revenue; (ii) a $ 5.4 million increase in vessel operating expenses, mainly due to the increased fleet; (iii) a $ 0.5 million increase in general and administrative fees; (iv) a $ 1.5 million increase in other expense; and (v) at $ 0. 9 million decrease in equity in net earnings of affiliated companies. The above decrease was partially mitigated by a: (i) $ 0.5 million decrease in time charter and travel expenses; and (ii) $ 0.9 million increase in other income.
The reserves for estimated maintenance and replacement capital expenditures for the three month periods ended June 30, 2020 and 2019 were $ 8.6 million and $ 7.3 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 June 30, 2020 of $ (1.1) million, as compared to $ 6.2 million for the three month period ended June 30, 2019. 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 Loss for the three month period ended June 30, 2020 was negatively affected by the accounting effect of a $ 6.8 million impairment loss related to three containerships. Net Loss for the three month period ended June 30, 2019 was negatively affected by the accounting effect of a: (i) $ 3.6 million revision of the estimated guarantee claim receivable; and (ii) $ 1.5 million write-off of deferred finance fees and discount related to the $ 73.5 million prepayments of the Term Loan B Facility in the second quarter of 2019. Excluding these items, Adjusted Net Loss for the three month period ended June 30, 2020 amounted to $ 7.8 million compared to $ 1.4 million loss for the three month period ended June 30, 2019. The increase in Adjusted Net Loss of $ 6.4 million was due to: (i) an $ 8.0 million decrease in Adjusted EBITDA ; (ii) a $ 0. 9 million increase in direct vessel expenses; (iii) a $ 0.4 million increase in depreciation and amortization expenses; and (iv) a $ 1.6 million decrease in interest income. The above increase was partially mitigated by a $ 4.5 million decrease in interest expense and finance cost, net.
Six month periods ended June 30, 2020 and 2019
Time charter and voyage revenues for the six month period ended June 30, 2020 decreased by $ 1.5 million, or 1.6%, to $ 93.0 million, as compared to $ 94.6 million for the same period in 2019. The decrease in time charter and voyage revenues was mainly attributable to the decrease in the TCE rate, to $ 10,957 per day for the six month period ended June 30, 2020, from $ 13,664 per day for the six month period ended June 30, 2019. The available days of the fleet increased to 8,126 days for the six month period ended June 30, 2020, as compared to 6,480 days for the six month period ended June 30, 2019, mainly due to the increase of the fleet.
EBITDA for the six month period ended June 30, 2020 was negatively affected by the accounting effect of a $ 6.9 million loss related to the other-than-temporary impairment recognized in the Navios Partners’ receivable from Navios Europe II and a $ 6.8 million impairment loss related to three containerships. EBITDA for the six month period ended June 30, 2019 was negatively affected by the accounting effect of a: (i) $ 7.3 million impairment loss on the sale of the Navios Galaxy I; and (ii) $ 3.6 million revision of the estimated guarantee claim receivable. Excluding these items, Adjusted EBITDA decreased by $ 11.6 million to $ 33.4 million for the six month period ended June 30, 2020, as compared to $ 45.0 million for the same period in 2019. The decrease in Adjusted EBITDA was primarily due to: ( i) a $ 1.5 million decrease in revenue; (ii) an $ 11.0 million increase in vessel operating expenses, mainly due to the increased fleet; (iii) a $ 0.6 million increase in general and administrative expenses; and (iv) a $ 1.8 million increase in other expense. The above decrease was partially mitigated by a: (i) $ 1.0 million decrease in time charter and travel expenses; (ii) $ 1.6 million increase in other income; and (iii) $ 0.8 million increase in equity in net earnings of affiliated companies.
The reserves for estimated maintenance and replacement capital expenditures for the six month periods ended June 30, 2020 and 2019 were $ 17.2 million and $ 14.7 million, respectively (please see “Reconciliation of Non-GAAP Financial Measures” in Exhibit 3).
Navios Partners generated an operating surplus for the six month period ended June 30, 2020 of $ 3.3 million, as compared to $ 11.9 million for the six month period ended June 30, 2019. 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 Loss for the six month period ended June 30, 2020 was negatively affected by the accounting effect of a $ 6.9 million loss related to the other-than-temporary impairment recognized in the Navios Partners’ receivable from Navios Europe II and a $ 6.8 million impairment loss related to three containerships. Net Loss for the six month period ended June 30, 2019 was negatively affected by the accounting effect of a: (i) $ 7.3 million impairment loss on the sale of the Navios Galaxy I; (ii) $ 3.6 million revision of the estimated guarantee claim receivable; and (iii) $ 1.5 million write-off of deferred finance fees and discount related to the $ 73.5 million prepayments of the Term Loan B Facility in the first half of 2019. Excluding these items, Adjusted Net Loss for the six month period ended June 30, 2020 amounted to $ 11. 7 million compared to $ 3.6 million for the six month period ended June 30, 2019. The increase in Adjusted Net Loss of $ 8.1 million was due to: (i) an $ 11.6 million decrease in adjusted EBITDA; (ii) a $ 1.8 million increase in direct vessel expenses; (iii) a $ 0.6 million increase in depreciation and amortization expense; and (iv) a $ 3.2 million decrease in interest income. The above decrease was partially mitigated by a $ 9.1 million decrease 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 six month periods ended June 30, 2020 and 2019.
| Three Month Period Ended June 30, 2020 (unaudited) |
Three Month Period Ended June 30, 2019 (unaudited) |
Six Month Period Ended June 30, 2020 (unaudited) |
Six Month Period Ended June 30, 2019 (unaudited) |
|||||||||||
| Available Days (1) | 4,029 | 3,203 | 8,126 | 6,480 | ||||||||||
| Operating Days (2) | 3,998 | 3,184 | 7,993 | 6,397 | ||||||||||
| Fleet Utilization (3) | 99.25 | % | 99.40 | % | 98.37 | % | 98.71 | % | ||||||
| Time Charter Equivalent Combined (per day) (4) | $ | 11,202 | $ | 14,130 | $ | 10,957 | $ | 13,664 | ||||||
| Time Charter Equivalent Drybulk (per day) (4) | $ | 9,421 | $ | 11,389 | $ | 8,826 | $ | 10,917 | ||||||
| Time Charter Equivalent Containers (per day) (4) | $ | 17,306 | $ | 30,684 | $ | 18,342 | $ | 30,593 | ||||||
| Vessels operating at period end | 51 | 36 | 51 | 36 | ||||||||||
- 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.
- Operating days are the number of available days in the relevant period less the aggregate number of days that the vessels are off-hire. Operating days include ballast days between voyages. The shipping industry uses operating days to measure the aggregate number of days in a relevant period during which vessels actually generate revenues.
- 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.
- 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 on Wednesday, July 29, 2020 to discuss the results for the second quarter and six month period ended June 30, 2020.
Call Date / Time: Wednesday, July 29, 2020 at 8:30 am ET
Call Title: Navios Partners Q2 2020 Financial Results Conference Call
US Dial In: +1.866.394.0817
International Dial In: +1.706.679.9759
Conference ID: 717 2627
The 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: +1.800.585.8367
International Replay Dial In: +1.404.537.3406
Conference ID: 717 2627
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 LP
Navios Maritime Partners LP 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 .
Contact Information:
www.navios-mlp.com
Tags:
, Wire, Disclosure Newswire, United States, English
Contact Information:
www.navios-mlp.com
