Navios Maritime Partners L.P. – Moody’s announces completion of a periodic review of ratings of Navios Maritime Partners L.P.
Moody’s Investors Service (“Moody’s”) has completed a periodic review of the ratings of Navios Maritime Partners L.P. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody’s reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. The review did not involve a rating committee. Since 1 January 2019, Moody’s practice has been to issue a press release following each periodic review to announce its completion.
This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history.
Key rating considerations are summarized below.
Navios Maritime Partners L.P.’s (NMM) B2 corporate family rating (CFR) reflects (1) the company’s low financial leverage compared with its peers; (2) its low operating costs, resulting from the fleet management contract signed with Navios Shipmanagement Inc. (NSM), an entity controlled by Angeliki Frangou, the chairman and CEO of Navios Group; (3) its relatively small size with some customer concentration; (4) its modest dividends and significant investment in Navios Maritime Containers L.P. (NMCI); and (5) the inherent volatility of the dry bulk shipping business, which experienced both multiyear highs and lows since the beginning of 2019.
This document summarizes Moody’s view as of the publication date and will not be updated until the next periodic review announcement, which will incorporate material changes in credit circumstances (if any) during the intervening period.
The principal methodology used for this review was Shipping Industry published in December 2017. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.
This announcement applies only to EU rated and EU endorsed ratings. Non EU rated and non EU endorsed ratings may be referenced above to the extent necessary, if they are part of the same analytical unit.
Navios Maritime Containers L.P. Rides the Pandemic Storm Amid Container Market Woes
Navios Maritime Containers L.P., a growth vehicle dedicated to the container sector of the maritime industry, today reported its financial results for the second quarter and six months ended June 30, 2020.
Angeliki Frangou, Chairman and Chief Executive Officer, stated, “I am pleased with our results for the second quarter of 2020. The container trade was severely hurt by global quarantine in place for much of the second quarter of 2020. Yet, Navios Containers reported revenue of $28.8 million and EBITDA of $7.0 million for the second quarter of 2020.”
Angeliki Frangou continued, “The timing of the recovery remains uncertain given the unique nature of the pandemic. Consumer demand has been understandably weak because of health and employment fears and general immobility arising from the pandemic. However, as people gradually return to a more normalized life, we expect that the economy will heal in the second half of 2020, with growth accelerating in 2021.”
HIGHLIGHTS – RECENT DEVELOPMENTS
Time charters of two 10,000 TEU vessels extended through 2026
In June 2020, Navios Containers agreed to extend the time charters at a net daily rate of $26,276 until May 2026 for each of the Navios Unison, a 2010-built 10,000 TEU containership, and the Navios Constellation, a 2011-built 10,000 TEU containership. The charter extensions were agreed in return for a charter hire reduction of $1,050 per day per vessel until May 2024. Following the extensions, an additional cumulative EBITDA of approximately $22.0 million is expected for both vessels.
The vessels cumulative additional EBITDA is calculated as follows: revenue at contracted net charter rate per day based on 360 days less, (i) operating expenses based on fixed rates as per the management agreement and (ii) general and administrative expenses equal to approximate current costs based on 365 days.
Fleet Employment
Navios Containers owns a fleet of 29 vessels, totaling 142,821 TEU. The current average age of the fleet is 12 years (See Exhibit II). As of July 21, 2020, Navios Containers has chartered-out 72.9% and 11.1% of its available days for the remaining six months of 2020 and for the full year 2021, respectively (including index-linked charters). Excluding index-linked charters, Navios Containers has chartered-out 69.3% and 9.3% of its available days for the remaining six months of 2020 and for the full year 2021, respectively, which are expected to generate $39.0 million and $22.8 million in revenue, respectively. The average expected daily contracted charter-out rate for the fleet is $10,556, net and $23,289, net for the remaining six months of 2020 and for the full year 2021, respectively (excluding index-linked charters), and the total expected available days for the remaining six months of 2020 and for the full year 2021, are 5,336 and 10,585 days, respectively.
Revenue for the three months ended June 30, 2020 was $28.8 million, as compared to $33.7 million for the same period during 2019. The decrease of $4.9 million was mainly due to a decrease in time charter rates partially offset by the increase in the number of available days from 2,568 for the three months ended June 30, 2019, to 2,598 for the three months ended June 30, 2020. Time charter equivalent, or TCE per day decreased from $12,594 for the three months ended June 30, 2019 to $10,148 for the same period during 2020.
Net Loss for the three months ended June 30, 2020 was a $2.1 million compared to $0.4 million Net Income for the same period in 2019. The $2.5 million decrease in Net Income was mainly due to a $5.7 million decrease in EBITDA and $0.6 million increase in amortization of deferred drydock and special survey costs. This overall increase of $6.3 million was partially offset by a: (i) $2.7 million decrease in depreciation and amortization, relating mainly to the lower amortization of intangible assets; and (ii) $1.1 million decrease in interest expense and finance cost, net.
EBITDA for the three months ended June 30, 2020 decreased by $5.7 million to $7.0 million as compared to $12.7 million for the same period in 2019. The decrease in EBITDA was primarily due to a: (i) $4.9 million decreased in revenue; (ii) $1.1 million increase in time charter and voyage expenses; and (iii) $0.8 million increase in management fees due to the increase in the number of available days and the increase in the fee for the ship management services, as per the management agreement. This overall decrease of $6.8 million was partially offset by a: (i) $1.0 million increase in other income, net; and (ii) $0.1 million decrease in other direct vessel expenses.
Full Report
Navios Maritime Holdings Inc. Takes Hit from Weak Dry Bulk Market
Navios Maritime Holdings Inc., a global seaborne shipping and logistics company, today reported financial results for the first quarter ended March 31, 2020.
Angeliki Frangou, Chairman and Chief Executive Officer, stated, “While the humanitarian crises caused by the pandemic has been heart breaking, we have also been strengthened by the courage and compassion of the first responders, particularly the many dedicated health care workers. I am proud of the members of the Navios family as they have shown admirable resilience during this unprecedented time of uncertainty, and we have taken the necessary measures to ensure safety of our people while keeping our fleet functioning.”
Angeliki Frangou continued, “For the first quarter of 2020, Navios Holdings reported revenue of $91.1 million, Adjusted EBITDA of $28.7 million and a TCE equivalent of $7,082. We experienced weak charter rates in the drybulk market in the first quarter and so far in the second quarter. Year to date 2020, the capesize 5TC rate averaged around $5,000 per day versus the 2019 average of $18,000 per day. We anticipate growth in the second half of the year as global economic activity returns.”
HIGHLIGHTS – RECENT DEVELOPMENTS
Fleet update
In May 2020, the Company sold to an unrelated third party the Navios Star, a 2002-built Panamax vessel of 76,662 dwt, for a sale price of $6.7 million.
In May 2020, the Company took delivery of the Navios Magellan II, a newbuilt Panamax vessel of 82,037 dwt under bareboat charter.
In March 2020, the Company took delivery of the Navios Galaxy II, a newbuilt Panamax vessel of 81,789 dwt under bareboat charter.
In March 2020, the Company acquired from an unrelated third party, a previously chartered-in vessel, the Navios Corali, a 2015-built Capesize vessel of 181,249 dwt, for an acquisition price of $36.6 million, which was paid in cash. The acquisition was financed through a sale and leaseback transaction with an unrelated third party.
Liquidation of Navios Europe (II) Inc. (“Navios Europe II”)
Navios Europe II, an entity in which Navios Holdings holds a 47.5% economic interest, is the owner of seven container vessels and seven dry bulk vessels. As of March 31, 2020, Navios Holdings had a receivable of approximately $31.5 million from Navios Europe II. Following the decision of the shareholders of Navios Europe II in May 2020 to liquidate the structure, a Special Committee of the Board of Directors comprised of independent directors, approved the allocation of assets. As part of the transaction, it is anticipated that Navios Holdings will receive cash subject to working capital adjustments at closing and will acquire two unencumbered Panamax dry bulk vessels. Closing is expected to occur during the second quarter of 2020. No assurances can be provided that definitive agreements will be executed or that the transaction will be completed in whole or in part.
Debt update
In June 2020, the Company entered into a secured loan agreement with Navios Shipmanagement Holdings Corporation, a wholly owned subsidiary of N Shipmanagement Acquisition Corp. (collectively “NSM”) for a loan of up to $50.0 million to be used for general corporate purposes. The terms and conditions of the secured loan agreement were approved by a Special Committee of the Board of Directors comprised of independent directors. The loan agreement will be repayable in 18 equal consecutive quarterly installments from the initial drawdown. Principal payments that fall due during the first year following the initial drawdown may be deferred, at the Company’s election, in whole or in part. The loan agreement provides for interest at a rate of 5% annually (and 7% annually for deferred principal amounts). No amount has been drawn to date.
Fleet statistics
Navios Holdings controls a fleet of 52 vessels totaling 5.6 million dwt, of which 34 are owned (including five bareboat-in vessels) and 18 are chartered-in under long-term charters (collectively, the “Core Fleet”). The fleet consists of 17 Capesize, 27 Panamax, six Ultra-Handymax and two Handysize vessels, with an average age of 7.6 years.
Navios Holdings has currently chartered-out 83.9% for the remaining nine months of 2020. Of these available days, 32.9% are chartered-out on fixed rate and 51.0% are chartered-out on index. The average contracted daily charter-in rate for the long-term charter-in vessels is $12,971 per day.
The above figures do not include the fleets of Navios South American Logistics Inc. (“Navios Logistics”) and vessels servicing contracts of affreightment.
Exhibit II provides certain details of the Core Fleet of Navios Holdings. It does not include the fleet of Navios Logistics.
Non-GAAP Measures
EBITDA, Adjusted EBITDA, Adjusted Net (Loss)/Income attributable to Navios Holdings’ common stockholders and Adjusted Basic Loss attributable to Navios Holdings’ common stockholders per share are non-U.S. GAAP financial measures and should not be used in isolation or as substitution for Navios Holdings’ 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, Adjusted EBITDA, Adjusted Net (Loss)/Income attributable to Navios Holdings’ common stockholders and Adjusted Basic Loss attributable to Navios Holdings’ common stockholders per share of Navios Holdings (including Navios Logistics), and EBITDA of Navios Logistics (on a stand-alone basis) and a reconciliation of such measures to the most comparable measures calculated under U.S. GAAP.
As of November 30, 2018, Navios Holdings obtained control over Navios Maritime Containers L.P. (“Navios Containers”) and consequently consolidated Navios Containers from that date onwards. Following the sale of Navios Containers general partnership interest on August 30, 2019, Navios Holdings deconsolidated Navios Containers from that date onwards. The results of operations of Navios Containers for the period from January 1, 2019 to March 31, 2019 consolidated under Navios Holdings have been reported as discontinued operations.
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Navios Acquisition to Add Product Tanker Quintet
Monaco-based ship owner and operator Navios Maritime Acquisition Corporation has inked an agreement to acquire five product tankers in liquidation of Navios Europe I.
The ships in question are MR1 tankers Perseus N, Star N, Hector N and LR1 tankers Aurora N and Lumen N.
On November 22, 2019, an agreement was reached to liquidate Navios Europe I, a company formed a few years ago to manage portfolios of vessels owned by HSH Nordbank.
As of September 30, 2019, Navios Acquisition had a receivable of USD 32.3 million from Navios Europe I.
This receivable along with debt financing will be used to finance the acquisition, the company said.
The agreement is subject to definitive documentation which is expected to be completed by the end of 2019, according to Navios Acquisition.
Navios Acquisition’s operating fleet currently comprises 38 vessels. In addition, the company is expected to take delivery of three VLCCs in 2020 and 2021.
Frangou Hails Cash Flow Visibility of $430.0 Million In Long-Term Contracted Revenue for Navios Maritime Acquisition Corporation
Navios Maritime Acquisition Corporation, an owner and operator of tanker vessels, reported its financial results yesterday for the third quarter and the nine month period ended September 30, 2019.
Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition stated: “I am pleased with our results for the third quarter of 2019. Navios Acquisition recorded revenue of $59.0 million and Adjusted EBITDA of $23.9 million, reflecting increases of about 42% and 142%, respectively, over the third quarter of 2018. We declared a quarterly distribution of $0.30 cents per share for the third quarter of 2019, for a current yield of about 16%.”
Angeliki Frangou continued: “In a robust tanker rate market, we have a good mix of fixed revenue and market exposure. We have cash flow visibility from $430.0 million in long-term contracted revenue. About 43% of available days in 2020 are fixed, almost half of which with profit sharing. At the same time, we are positioned to capture upside, as 61.7% of available days in 2020 are open or on floating rates. All of our delivered tankers are on the water generating revenue, as we have no tankers now being fit with scrubbers.“
HIGHLIGHTS – RECENT DEVELOPMENTS
Quarterly dividend: $0.30 per share
On November 5, 2019, the Board of Directors declared a quarterly cash dividend in respect of the third quarter of 2019 of $0.30 per share of common stock, which will be paid on January 9, 2020, to stockholders of record as of December 17, 2019. 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 Acquisition’s 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.
Equity Offering
On October 20, 2019, Navios Acquisition completed a registered direct offering of 1,875,000 shares of its common stock at $8.00 per share, raising gross proceeds of $15.0 million. Total net proceeds of the above transaction, net of agents’ costs of $0.7 million and estimated offering costs $0.3 million, amounted to $14.0 million.
Term Loan B Refinancing and other debt developments
In October 2019, Navios Acquisition fully prepaid its Term Loan B facility due in June 2020. The outstanding balance of the Term Loan B as of June 30, 2019 was $196.8 million. Navios Acquisition funded the repayment as follows:
$153.0 million financing through sale-and-leaseback transactions. The sale and leaseback transactions have (a) an average amortization profile of approximately 17 years on an age-adjusted basis, (b) annual interest of LIBOR plus a margin ranging from 335 bps to 360 bps and (c) an average maturity of 7 years;$31.8 million facility from a commercial bank in order to finance one VLCC. The facility bears an annual interest of LIBOR plus 280 bps, and matures in one year; and$12.0 million from cash on balance sheet.
Following the completion of the repayment of the Term Loan B, Navios Acquisition has no debt maturities until the third quarter of 2020. In the fourth quarter 2019 Navios Acquisition repurchased $7.0 million of Ship Mortgage Notes for a cost of $5.8 million. Year to date, Navios Acquisition reduced its debt by 4% or $45.3 million, compared to the outstanding balance as of December 31, 2018.
Amendment of the Management Agreement and the Administrative Services Agreement
In August 2019, Navios Acquisition extended the duration of its existing management agreement (the “Management Agreement”) with Navios Tankers Management Inc. (the “Manager”) until January 1, 2025. In addition management fees are fixed for two years commencing from January 1, 2020 at: (a) $6,825 per day per MR2 product tanker and chemical tanker vessel; (b) $7,225 per day per LR1 product tanker vessel; and (c) $9,650 per day per VLCC. The agreement also provides for a technical and commercial management fee of $50 per day per vessel and an annual increase of 3% after January 1, 2022 for the remaining period unless agreed otherwise. Drydocking expenses are reimbursed at cost for all vessels.
In August 2019, Navios Acquisition extended the duration of its existing administrative services agreement (the “Administrative Services Agreement”) with the Manager until January 1, 2025, which provides for allocable general and administrative costs.
Fleet employment
On October 8, 2019, Navios Acquisition sold the Nave Electron, a 2002-built VLCC vessel of 305,178 dwt to an unaffiliated third party for a sale price of $25.3 million.
On October 17, 2019 the Nave Synergy, a 2010-built VLCC was chartered to a major charterer for 62 – 74 months at charterers’ option at a net base rate of $48,153 per day with profit sharing arrangements. The Nave Buena Suerte a 2011-built VLCC will take over the contract when released from existing commitment. The Nave Photon, a 2008-built VLCC was chartered to a major charterer for 74 – 86 months at charterers’ option with delivery between December 2019 and February 2020 at a net base rate of $48,153 per day with profit sharing arrangements. The TBN III bareboat chartered-in VLCC will take over the contract upon delivery in the third quarter 2021.
As of November 7, 2019, Navios Acquisition’s fleet consisted of a total of 41 vessels, of which 13 are VLCCs (including three bareboat chartered-in VLCCs expected to be delivered in the third and fourth quarters of 2020 and the third quarter of 2021), 26 are product tankers, two are chemical tankers.
Currently, Navios Acquisition has contracted 42.7% of its available days on a charter-out basis for 2020, which are expected to generate revenues of approximately $112.1 million. The average base contractual net daily charter-out rate for the 38.3% of available days that are contracted on base rate and/or base rate with profit sharing arrangements is expected to be $20,917.
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Navios Containers extends charters for 10,000-teu boxship duo
Monaco-based Navios Maritime Containers has extended the charters on two 10,000 TEU vessels through 2024, the company has confirmed.
In September 2019, the company agreed to extend the time charters of the 2010-built Navios Unison and the 2011-built Navios Constellation at USD 27,300 per day net until May 2024.
The company revealed the charter extensions as part of its financial results for the third quarter and nine months ended September 30, 2019. During the period Navios Containers reported USD 37 million of revenue, USD 16.6 million of EBITDA and USD 4.1 million of net income. The numbers were down from the third quarter of 2018, when the company’s revenue, EBITDA and net income stood at USD 38 million, USD 19.2 million and USD 5.4 respectively.
“I am pleased with the results for the third quarter of 2019,” Angeliki Frangou, Chairman and Chief Executive Officer, said, adding that Navios Containers reported earnings per unit of 12 cents, down from 16 cents per unit a year ago.
“We believe that Navios Containers is well-positioned going into 2020. It enjoys materially improved charter rates, with current market rates having increased by almost 70% since the first quarter of 2019. Navios Containers also benefits from fixed operating costs and attractive financing,” Frangou continued.
Navios Acquisition Looking to Raise USD 15 Mn
Angeliki Frangou-led tanker owner Navios Maritime Acquisition is looking to raise up to USD 15 million as it priced an offering of 1,875,000 shares of common stock.
According to the company, the equity share was set at a price of USD 8 per share. The offering is expected to close on or about October 24, 2019. The company estimates that the net proceeds from the offering, after deducting estimated offering expenses and placement agent fees, will be around USD 14 million. The net proceeds from the registered direct offering would be used for general corporate purposes.
For the three-month period ended June 30, 2019, Navios Acquisition reported a net loss of USD 16.5 million, compared to a net loss of USD 22 million seen in the same quarter a year earlier. Revenue for the quarter was up to USD 58.6 million from USD 41.5 million recorded in the second quarter of 2018.
Navios Maritime Containers L.P. appoints Erifili Tsironi as Chief Financial Officer
Navios Maritime Containers L.P., a growth vehicle dedicated to the container sector of the maritime industry, announced today the appointment of Mrs. Erifili Tsironi as Chief Financial Officer of Navios Containers.
Mrs. Tsironi previously served as Co-Chief Financial Officer of Navios Maritime Acquisition Corporation since December of 2018 and as Chief Financial Officer of Navios Maritime Midstream Partners L.P. from its inception in 2014 until December 2018.
Mrs. Tsironi has over 17 years of experience in banking focusing on ship finance. Before joining Navios Maritime Midstream Partners L.P., she was Global Dry Bulk Sector Coordinator and Senior Vice President at DVB Bank SE.
Mrs. Tsironi holds a BSc. in Economics, awarded with Honours, from the London School of Economics and Political Science and a MSc in Shipping, Trade and Finance, awarded with Distinction, from Cass Business School of City University in London.
Mr. Chris Christopoulos, who previously served as Chief Financial Officer of Navios Containers, recently left the company.
Angeliki Frangou, Chairman of the Board of Directors and Chief Executive Officer of Navios Containers, commented: “We would like to thank Mr. Christopoulos for his service and wish him well with his future endeavors.”
Navios Maritime Partners (NMM) Downgraded by Zacks Investment Research
Zacks Investment Research lowered shares of Navios Maritime Partners (NYSE:NMM) from a hold rating to a sell rating in a research note published on Thursday morning, Zacks.com reports.According to Zacks, “Navios Maritime Partners L.P. is an international owner and operator of dry cargo vessels. It engages in the seaborne transportation services of drybulk commodities including iron ore, coal, grains, fertilizers and chartering of its vessels under medium to long-term charters. Navios Maritime Partners L.P. is headquartered in Piraeus, Greece.”
Separately, ValuEngine raised shares of Navios Maritime Partners from a sell rating to a hold rating in a research report on Monday, April 1st.Navios Maritime Partners has a 12-month low of $0.78 and a 12-month high of $2.11. The company has a market capitalization of $154.18 million, a PE ratio of 4.38 and a beta of 1.81. The company has a quick ratio of 1.65, a current ratio of 1.65 and a debt-to-equity ratio of 0.62.Navios Maritime Partners (NYSE:NMM) last posted its earnings results on Thursday, January 31st. The shipping company reported $0.03 earnings per share for the quarter, missing analysts’ consensus estimates of $0.05 by ($0.02). Navios Maritime Partners had a positive return on equity of 4.57% and a negative net margin of 5.65%. The business had revenue of $57.54 million for the quarter, compared to analyst estimates of $57.92 million. As a group, equities research analysts anticipate that Navios Maritime Partners will post 0.04 earnings per share for the current fiscal year.Hedge funds have recently made changes to their positions in the stock. Deutsche Bank AG lifted its position in Navios Maritime Partners by 983.2% during the fourth quarter. Deutsche Bank AG now owns 1,224,668 shares of the shipping company’s stock worth $1,039,000 after acquiring an additional 1,111,609 shares during the last quarter. Globeflex Capital L P acquired a new position in shares of Navios Maritime Partners in the fourth quarter valued at approximately $750,000. Renaissance Technologies LLC grew its position in shares of Navios Maritime Partners by 10.2% in the third quarter. Renaissance Technologies LLC now owns 2,601,200 shares of the shipping company’s stock valued at $4,552,000 after purchasing an additional 241,302 shares during the last quarter. Two Sigma Securities LLC grew its position in shares of Navios Maritime Partners by 235.2% in the fourth quarter. Two Sigma Securities LLC now owns 38,535 shares of the shipping company’s stock valued at $33,000 after purchasing an additional 27,039 shares during the last quarter. Finally, Macquarie Group Ltd. increased its stake in shares of Navios Maritime Partners by 97.6% during the fourth quarter. Macquarie Group Ltd. now owns 44,409 shares of the shipping company’s stock worth $38,000 after purchasing an additional 21,937 shares during the period. 12.72% of the stock is owned by institutional investors and hedge funds.
Source: MarketBeat
Navios Maritime Containers L.P. Announces Appointment of Mr. Kuch and Mr. Mouyis to the Board of Directors
Navios Maritime Containers L.P., a growth vehicle dedicated to the container sector, announced yesterday the appointment of Mr. Stefan Kuch and Mr. Vasilios Mouyis to its Board of Directors.
Mr. Kuch has over 32 years of experience in finance and ship finance, having served in senior leadership positions in the shipping division of Commerzbank AG, one of Germany’s leading financial institutions. He also served as Managing Director of Hanseatic Ship Asset Management GmbH, a vessel-owning company within the Commerzbank Group. Mr Kuch was previously a member of the Board of Directors of Navios Maritime Midstream Partners L.P.
Mr. Mouyis has over 28 years of experience in chartering and ship brokerage. He is the co-founder and managing director of Doric Shipbrokers S.A., a ship brokering firm. Previously, Mr. Mouyis served as a chartering broker at Clarkson’s Plc South African office, formerly known as Afromar Pty Ltd. He is also a panelist for the Handysize index of the Baltic Exchange, London. Mr Mouyis was previously a member of the Board of Directors of Navios Maritime Midstream Partners L.P.
Navios Containers also announced that Gareth Williams, a director of Navios Containers, has resigned from the board of directors. Ms. Frangou commented, “We would like to thank Mr. Williams for his contributions and wish him well with his future endeavors.”Source: Navios Maritime Containers L.P.