Navios Maritime Containers L.P. Reports Financial Results for the Second Quarter and Six Months Ended June 30, 2020
Navios Maritime Containers L.P. (NASDAQ: NMCI) reported financial results for Q2 and H1 2020. Revenue reached $28.8 million in Q2 and $69.1 million for H1, marking a decrease from $33.7 million and $65.5 million in the same periods of 2019, respectively. The company reported a net loss of $2.1 million for Q2 2020, contrasting with a net income of $448,000 in Q2 2019. However, EBITDA for H1 increased slightly to $24.9 million. Charter extensions for two vessels are expected to provide an additional $22 million in EBITDA by 2026.
- Charter extensions for two vessels extended through 2026, expected to generate an additional $22 million in EBITDA.
- Revenue for H1 2020 increased to $69.1 million from $65.5 million in H1 2019.
- Net income for H1 2020 rose to $2.9 million from $0.5 million in H1 2019.
- Q2 2020 revenue decreased to $28.8 million compared to $33.7 million in Q2 2019.
- Net loss of $2.1 million in Q2 2020, down from a net income of $448,000 in Q2 2019.
- EBITDA for Q2 2020 decreased to $7.0 million compared to $12.7 million in Q2 2019.
Revenue
$69.1 million for H1 2020$28.8 million for Q2 2020
Cash (used in)/provided by operating activities
$(4.5) million for H1 2020$2.5 million for Q2 2020
EBITDA
$24.9 million for H1 2020$7.0 million for Q2 2020
Net income/(loss)
$2.9 million for H1 2020$(2.1) million for Q2 2020
Charter Extensions
- Time charters of two 10,000 TEU vessels extended through 2026
Debt Maturities
- No significant debt maturities until 2023
MONACO, July 23, 2020 (GLOBE NEWSWIRE) -- Navios Maritime Containers L.P. (“Navios Containers” or the “Company”) (NASDAQ: NMCI), 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
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
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
Earnings Highlights
EBITDA is a non-U.S. GAAP financial measure and should not be used in isolation or as a substitute for Navios Containers’ results calculated in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”).
See Exhibit I under the heading, “Disclosure of Non-GAAP Financial Measures,” for a discussion of EBITDA of Navios Containers and a reconciliation of such measure to the most comparable measures calculated under U.S. GAAP.
Second Quarter 2020 and 2019 Results
The second quarter of 2020 and 2019 information presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.
| Three Month Period Ended June 30, 2020 | Three Month Period Ended June 30, 2019 | |||||||
| (in thousands of U.S. dollars, except per unit data) | (unaudited) | (unaudited) | ||||||
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| Net (Loss)/Income | $ | (2,119 | ) | $ | 448 | |||
| Net cash provided by operating activities | $ | 2,490 | $ | 9,358 | ||||
| EBITDA | $ | 7,035 | $ | 12,730 | ||||
| Net (Loss)/Earnings per common unit (basic and diluted) | $ | (0.06 | ) | $ | 0.01 |
Revenue for the three months ended June 30, 2020 was
Net Loss for the three months ended June 30, 2020 was a
EBITDA for the three months ended June 30, 2020 decreased by
First Half of 2020 and 2019 Results
The information for the six month periods ended June 30, 2020 and 2019 presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.
| Six Month Period Ended June 30, 2020 | Six Month Period Ended June 30, 2019 | |||||||
| (in thousands of U.S. dollars, except per unit data) | (unaudited) | (unaudited) | ||||||
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| Net Income | $ | 2,890 | $ | 501 | ||||
| Net cash (used in)/provided by operating activities | $ | (4,505 | ) | $ | 9,321 | |||
| EBITDA | $ | 24,866 | $ | 24,778 | ||||
| Net Earnings per common unit (basic and diluted) | $ | 0.08 | $ | 0.01 |
Revenue for the six months ended June 30, 2020 was
Net Income for the six months ended June 30, 2020 was
EBITDA for the six months ended June 30, 2020 increased by
Fleet Summary Data:
The following table reflects certain key indicators indicative of the performance of the Navios Containers' operations and its fleet performance for the three and six months ended June 30, 2020 and 2019.
| Three Month | Three Month | Six Month | Six Month | |||||||||||||
| Period Ended | Period Ended | Period Ended | Period Ended | |||||||||||||
| June 30, | June 30, | June 30, | June 30, | |||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
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| Operating Days (2) | 2,597 | 2,563 | 5,225 | 5,026 | ||||||||||||
| Fleet Utilization (3) | 100.0 | % | 99.8 | % | 99.8 | % | 99.7 | % | ||||||||
| Vessels operating at period end | 29 | 29 | 29 | 29 | ||||||||||||
| TCE (4) | $ | 10,148 | $ | 12,594 | $ | 12,225 | $ | 12,409 |
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| (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. Operating days include ballast days between voyages. | |
| (3) | Fleet utilization is the percentage of time that Navios Containers' vessels were available for generating revenue, and is determined by dividing the number of operating days during a relevant period by the number of available days during that period. | |
| (4) | TCE per day is defined as voyage and time charter revenues less voyage expenses during a relevant period divided by the number of available days during the period. |
Conference Call:
As previously announced, Navios Containers will host a conference call on Thursday, July 23, 2020, at 8:00 am ET, during which time Navios Containers’ senior management will provide highlights and commentary on earnings results for the second quarter and six months ended June 30, 2020.
A supplemental slide presentation will be available on the Navios Containers website at www.navios-containers.com under the "Investors" section by 7:30 am ET on the day of the call.
Conference Call details:
Call Date/Time: Thursday, July 23, 2020 at 8:00 am ET
Call Title: Navios Containers Q2 2020 Financial Results Conference Call
US Dial In: +1.866.703.4207
International Dial In: +1.636.692.6440
Conference ID: 637 1907
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: 637 1907
This call will be simultaneously Webcast. The Webcast will be available on the Navios Containers’ website, www.navios-containers.com under the "Investors" section. The Webcast will be archived and available at the same Web address for two weeks following the call.
About Navios Maritime Containers L.P.
Navios Maritime Containers L.P. is a growth-oriented international owner and operator of containerships. For more information, please visit our website at www.navios-containers.com.
Forward Looking Statements - Safe Harbor
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 future contracted revenues and rates, EBITDA, future available days, future financial performance of the fleet, timing of vessel deliveries, vessel acquisitions, financing activities, and Navios Containers' growth strategy and measures to implement such strategy, including future vessel acquisitions and the ability to secure or refinance related financing, the further growth of our containership fleet, and entering into further time charters. Words such as “may,” “expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,” “estimates,” and variations of such words and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on the information available to, and the expectations and assumptions deemed reasonable by Navios Containers at the time these statements were made. Although Navios Containers believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of Navios Containers. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, risks relating to: global and regional economic and political conditions including the impact of the COVID-19 pandemic and efforts throughout the world to contain its spread, including effects on global economic activity, demand for seaborne transportation of the products we ship, the ability and willingness of charterers to fulfill their obligations to us and prevailing charter rates, shipyards performing scrubber installations, drydocking and repairs, changing vessel crews and availability of financing; potential disruption of shipping routes due to accidents, diseases, pandemics, political events, piracy or acts by terrorists, including the impact of the COVID-19 pandemic and the ongoing efforts throughout the world to contain it; the favorable timing for acquisitions and chartering opportunities in the container shipping sector and Navios Containers’ ability to take advantage of such opportunities; the value of container shipping vessels; Navios Containers’ ability to identify container shipping vessels for acquisition at attractive prices, if at all, including the availability of distressed acquisition opportunities in the container shipping industry; Navios Containers’ ability to execute on a low-cost operating structure; Navios Containers’ ability to achieve a return on investment for and to pay cash distributions to our unitholders or make common unit repurchases from our unitholders; any advantages resulting from Navios Containers’ strategic focus on intermediate-size containerships; Navios Containers’ ability to leverage the scale, experience, reputation and relationships of the Navios Group, consisting of Navios Maritime Holdings Inc., Navios Maritime Acquisition Corporation, Navios Maritime Partners L.P., and any one or more of their subsidiaries and affiliates. Navios Containers’ future financial condition or results of operations and its future revenues and expenses, including its estimated adjusted cash flow; the loss of any customer or charter or vessel; the aging of Navios Containers’ vessels and resultant increases in operation and drydocking costs; Navios Containers’ ability to maintain long-term relationships with major liner companies; Navios Containers’ ability to access debt, credit and equity markets; potential liability from litigation and our vessel operations, including discharge of pollutants; Navios Containers’ and the Navios Group’s performance in safety, environmental and regulatory matters; increases in costs and expenses, including but not limited to, crew wages, insurance, technical maintenance costs, spares, stores and supplies, charter brokerage commissions on gross voyage revenues and general and administrative expenses; the changes to the regulatory requirements applicable to the shipping and container transportation industry, including, without limitation, stricter requirements adopted by international organizations, such as the International Maritime Organization and the European Union, or by individual countries or charterers and actions taken by regulatory authorities and governing such areas as safety and environmental compliance; the anticipated taxation of Navios Containers and its unitholders; and the effects of increasing emphasis on environmental and safety concerns by customers, governments and others, as well as changes in maritime regulations and standards. Navios Containers expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Navios Containers' expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. Navios Containers makes no prediction or statement about the performance of its common units.
Contact:
Navios Maritime Containers L.P.
+1.212.906.8648
investors@navios-containers.com
EXHIBIT I
| NAVIOS MARITIME CONTAINERS L.P. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Expressed in thousands of U.S. dollars - except for unit and per unit data) | |||||||||||||||
| Three Month Period Ended June 30, 2020 | Three Month Period Ended June 30, 2019 | Six Month Period Ended June 30, 2020 | Six Month Period Ended June 30, 2019 | ||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
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| Time charter and voyage expenses | (2,422 | ) | (1,335 | ) | (5,023 | ) | (2,982 | ) | |||||||
| Direct vessel expenses | (1,473 | ) | (1,034 | ) | (2,672 | ) | (1,822 | ) | |||||||
| Management fees | (17,192 | ) | (16,408 | ) | (34,384 | ) | (32,131 | ) | |||||||
| General and administrative expenses | (2,552 | ) | (2,570 | ) | (5,095 | ) | (5,064 | ) | |||||||
| Depreciation and amortization | (4,377 | ) | (7,064 | ) | (11,435 | ) | (14,173 | ) | |||||||
| Interest expense and finance cost, net | (3,366 | ) | (4,386 | ) | (7,930 | ) | (8,484 | ) | |||||||
| Other income/ (expense), net | 473 | (433 | ) | 378 | (353 | ) | |||||||||
| Net (loss)/ income | $ | (2,119 | ) | $ | 448 | $ | 2,890 | $ | 501 | ||||||
| Net (loss)/ earnings per unit, basic and diluted | $ | (0.06 | ) | $ | 0.01 | $ | 0.08 | $ | 0.01 | ||||||
| Weighted average number of units, basic and diluted | 34,603,100 | 34,603,100 | 34,603,100 | 34,603,100 | |||||||||||
| NAVIOS MARITIME CONTAINERS L.P. CONDENSED CONSOLIDATED BALANCE SHEETS (Expressed in thousands of U.S. dollars – except for unit data) | |||||||
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| June 30, 2020 | December 31, 2019 | ||||||
| (unaudited) | (unaudited) | ||||||
| ASSETS | |||||||
| Cash and cash equivalents, including restricted cash | $ | 11,356 | $ | 18,109 | |||
| Vessels and deferred dry dock and special survey costs, net | 410,867 | 415,143 | |||||
| Other assets (including current and non-current) | 24,164 | 20,762 | |||||
| Intangible assets | — | 6,288 | |||||
| Total assets | $ | 446,387 | $ | 460,302 | |||
| LIABILITIES AND PARTNERS’ CAPITAL | |||||||
| Other current liabilities | $ | 5,233 | $ | 24,664 | |||
| Current portion of long term borrowings, net | 32,403 | 46,733 | |||||
| Long-term borrowings, net of current portion | 215,881 | 198,925 | |||||
| Total Partners’ capital | 192,870 | 189,980 | |||||
| Total liabilities and Partners’ capital | $ | 446,387 | $ | 460,302 | |||
Disclosure of Non-GAAP Financial Measures
EBITDA is a “non-U.S. GAAP financial measure” and should not be used in isolation or considered a substitute for net income/(loss), cash flow from operating activities and other operations or cash flow statement data prepared in accordance with generally accepted accounting principles in the United States.
EBITDA represents net income/(loss) attributable to Navios Containers’ common unitholders before interest and finance costs, before depreciation and amortization and before income taxes. Navios Containers uses EBITDA as a liquidity measure and reconciles EBITDA to net cash provided by/(used in) operating activities, the most comparable U.S. GAAP liquidity measure. EBITDA is calculated as follows: net cash provided by/(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 (increase)/decrease in operating liabilities; (iii) net interest and finance cost; (iv) amortization and write-off of deferred financing costs; and (v) payments for drydock and special survey costs. Navios Containers believes that EBITDA is a basis upon which liquidity can be assessed and represents useful information to investors regarding Navios Containers’ ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay distributions. Navios Containers also believes that EBITDA is used: (i) by prospective and current lessors as well as potential lenders to evaluate potential transactions; (ii) to evaluate and price potential acquisition candidates; and (iii) by securities analysts, investors and other interested parties in the evaluation of companies in our industry.
EBITDA is presented to provide additional information with respect to the ability of Navios Containers to satisfy its respective obligations, including debt service, capital expenditures, working capital requirements and pay distributions. While EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.
EBITDA has limitations as an analytical tool, and therefore, should not be considered in isolation or as a substitute for the analysis of Navios Containers’ results as reported under U.S. GAAP. Some of these limitations are: (i) EBITDA does not reflect changes in, or cash requirements for, working capital needs; (ii) EBITDA does not reflect the amounts necessary to service interest or principal payments on our debt and other financing arrangements; and (iii) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future. EBITDA does not reflect any cash requirements for such capital expenditures. Because of these limitations, among others, EBITDA should not be considered as a principal indicator of Navios Containers’ performance. Furthermore, Navios Containers’ calculation of EBITDA may not be comparable to that reported by other companies due to differences in methods of calculation.
Reconciliation of EBITDA to Cash from Operations
| 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) | ||||||||||||
| Expressed in thousands of U.S. dollars | |||||||||||||||
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| Net (decrease)/increase in operating assets | (3,079 | ) | 5,621 | 3,403 | 6,228 | ||||||||||
| Net decrease /(increase) in operating liabilities | 1,387 | (6,561 | ) | 15,527 | (1,284 | ) | |||||||||
| Net interest and finance cost | 3,366 | 4,386 | 7,930 | 8,484 | |||||||||||
| Amortization and write-off of deferred financing costs | (353 | ) | (541 | ) | (1,667 | ) | (1,145 | ) | |||||||
| Payments for dry dock and special survey costs | 3,224 | 467 | 4,178 | 3,174 | |||||||||||
| EBITDA | $ | 7,035 | $ | 12,730 | $ | 24,866 | $ | 24,778 |
| Expressed in thousands of U.S. dollars | 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) | |||||||||||
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| Net cash used in investing activities | $ | (3,016 | ) | $ | (54,892 | ) | $ | (3,207 | ) | $ | (56,647 | ) | |||
| Net cash (used in)/provided by financing activities | $ | (8,741 | ) | $ | 47,788 | $ | 959 | $ | 45,289 | ||||||
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| Owned Vessels | ||||||
| Vessel Name | TEU | Year Built | ||||
| Navios Summer (1) | 3,450 | 2006 | ||||
| Navios Verano (1) | 3,450 | 2006 | ||||
| Navios Spring (1) | 3,450 | 2007 | ||||
| Navios Amaranth (1) | 4,250 | 2007 | ||||
| Navios Indigo (1) | 4,250 | 2007 | ||||
| Navios Vermilion (1) | 4,250 | 2007 | ||||
| Navios Verde (1) | 4,250 | 2007 | ||||
| Navios Amarillo (1) | 4,250 | 2007 | ||||
| Navios Azure (1) | 4,250 | 2007 | ||||
| Navios Domino (1) | 4,250 | 2008 | ||||
| Navios Delight (1) | 4,250 | 2008 | ||||
| Navios Dedication (1) | 4,250 | 2008 | ||||
| Navios Devotion (1) | 4,250 | 2009 | ||||
| Navios Destiny (1) | 4,250 | 2009 | ||||
| Navios Lapis | 4,250 | 2009 | ||||
| Navios Tempo | 4,250 | 2009 | ||||
| Navios Dorado | 4,250 | 2010 | ||||
| Navios Felicitas | 4,360 | 2010 | ||||
| Bahamas | 4,360 | 2010 | ||||
| Bermuda | 4,360 | 2010 | ||||
| Navios Miami | 4,563 | 2009 | ||||
| Navios Magnolia (ex APL Oakland) | 4,730 | 2008 | ||||
| Navios Jasmine (ex APL Los Angeles) | 4,730 | 2008 | ||||
| APL Denver | 4,730 | 2008 | ||||
| Navios Nerine (ex APL Atlanta) | 4,730 | 2008 | ||||
| Navios Utmost (ex YM Utmost) (1) | 8,204 | 2006 | ||||
| Navios Unite (1) | 8,204 | 2006 | ||||
| Navios Unison (2) | 10,000 | 2010 | ||||
| Navios Constellation (2) | 10,000 | 2011 |
(1) The vessel is subject to a sale and leaseback transaction for a period of up to five years, at which time Navios Containers has an obligation to purchase the vessel.
(2) The vessel is subject to a sale and leaseback transaction for a period of up to seven years, at which time Navios Containers has an obligation to purchase the vessel.
FAQ
What were Navios Maritime Containers' revenue figures for Q2 2020?
How did Navios Maritime Containers perform financially in H1 2020?
What is the expected EBITDA from Navios Maritime Containers' charter extensions?
What was the net loss reported by Navios Maritime Containers for Q2 2020?
How does the EBITDA for Q2 2020 compare to Q2 2019 for Navios Maritime Containers?
