NAVIOS MARITIME PARTNERS L.P.
REPORTS FINANCIAL RESULTS FOR THE FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2008
INCREASES CASH DISTRIBUTION BY 4% TO $0.40 PER UNIT FOR THE FOURTH QUARTER OF 2008
-Revenue of $21.6 million and $75.1 million for the three month period and the year ended December 31, 2008
-Operating Surplus of $9.4 million and $32.1 million for the three month period and the year ended December 31, 2008
-Distribution of $0.40 per unit for the three month period ended December 31, 2008
-$30.5 million accelerated lump sum charter payment receivable in Q1 2009
PIRAEUS, GREECE, January 29, 2009 - Navios Maritime Partners L.P. ("Navios Partners" or "Company") (NYSE: "NMM"), an owner and operator of Capesize and Panamax vessels, reported its financial results for the three month period and the year ended December 31, 2008.
Ms. Angeliki Frangou, Chairman and Chief Executive Officer of Navios Partners, stated: "The results of the fourth quarter of 2008 were in line with our expectations, and we have declared a $0.40 per unit cash distribution for the fourth quarter of 2008. This distribution represents a 4% increase over the prior quarter. We are comfortable with this dividend policy in the current environment as Navios Partners is well positioned given the long-term employment of its fleet, averaging 4.4 years, the quality of its charter parties and the AA+ EU governmental agency insurance on all its charter-out contracts."
Ms. Frangou continued "There is some data that allows measured optimism for our industry. It appears that urbanization and the associated demand for dry bulk cargo continues. The BDI has progressed well off its December lows and various governmental stimulus packages are targeted towards infrastructure development."
Navios Aurora Employment Terms:
Navios Partners will receive approximately $30.5 million lump sum charter payment for Navios Aurora I in the first quarter of 2009. This charter payment represents an acceleration of a significant portion of the $56.2 million nominal charter amount. Navios Partners will receive the entire amount of the original charter through the lump sum payment and the new charter payments for the remainder of the term of the original charter (ending in 2013). The acceleration of the charter payment provides Navios Partners with a present value benefit of approximately $3.7 million.
Revolving Facility Amendment:
Navios Partners has agreed to amend the terms of its existing credit facility. The company will prepay $40.0 million of its credit revolving facility in the first quarter of 2009. This would result in interest expense savings for 2009 of approximately $1.5 million and a reduction in the Company's leverage. The interest rate on the remaining facility of $195.0 million would have a spread of 225 bps.
The amendment will be effective until January 15, 2010 and will be applied for year end 2008 compliance purposes. No further principal payments would be required to be made until the first quarter of 2012.
Shelf Registration Filing:
The Company has filed a shelf registration statement on January 29, 2009 under which it may sell any combination of securities (debt or equity) for up to a total of $500.0 million
The Board of Directors of Navios Partners declared a cash distribution for the fourth quarter of 2008 of $0.40 per unit. This distribution is payable on February 12, 2009 to all holders of record as of February 9, 2009.
Long Term and Insured Cash Flow
Navios Partners has entered into long-term time charters-out for all ten vessels with a remaining average term of 4.4 years, providing a stable base of revenue and distributable cash flow. The Company has currently contracted out 100% of available days for 2009 and 2010 generating revenues of $117.6 million and $98.0 million respectively. The average contractual daily charter-out rate for the fleet is $33,914 (rate is adjusted to include the $30.5 million lump sum to be received in Q1 2009) and $26,840 for 2009 and 2010, respectively. The average daily charter-in rate for the active long term charter-in vessels for 2009 is $13,513.
Navios Partners' charter-out contracts have been fully insured by a AA+ rated European Union governmental agency.
Operating Expense Visibility
Navios Partners has entered into a five-year management agreement expiring in November 2012, with a subsidiary of Navios Holdings. Vessel operating expense rates are fixed until November 16, 2009 at (i) $4,000 per day for each owned Panamax vessel and (ii) $5,000 for each owned Capesize vessel.
The following table presents consolidated revenue and expense information for the quarter and the year ended December 31, 2008. We do not present comparative information for periods prior to the closing of our initial public offering on November 16, 2007 because we only operated for 46 days in 2007 and we believe that periods prior to November 16, 2007 are not necessarily comparable given the change in the nature and focus of the business. For example, it is the policy of Navios Partners' not to trade FFAs, whereas certain prior periods contain such transactions. In addition, certain agreements such as the management agreement were first effective as of November 16, 2007.
Three month period ended December 31, 2008
For three month period ended December 31, 2008, Navios Partners' time charter revenue amounted to $21.6 million whereas time charter expenses for the same period were $2.8 million. Other expenses, including management fees and general and administrative expenses amounted to $4.2 million.
EBITDA for the three month period ended December 31, 2008 was $14.2 million (please see Reconciliation of Non-GAAP Financial Measures on Exhibit 3).
The increase in the reserve for estimated maintenance and replacement capital expenditures for the three month period ended December 31, 2008 was $2.7 million. Maintenance and replacement capital expenditures represent expenditures required to maintain, over the long term the operating capacity of Navios Partners' capital assets.
Navios Partners generated an operating surplus for the period of $9.4 million. Operating surplus is a non-GAAP financial measure used by certain investors to measure the financial performance of Navios Partners and other master limited partnerships (please see Reconciliation of Non-GAAP Financial Measures on Exhibit 3).
Depreciation and amortization expense for the period (including amortization of drydocking and special survey costs presented under direct vessel expenses) was $3.4 million and interest expense and finance cost related to $235.0 million of borrowings under Navios Partners' facility agreement was $2.1 million.
Net income for three month period ended December 31, 2008 was $8.8 million.
Year ended December 31, 2008
For the year ended December 31, 2008, Navios Partners' time charter revenue amounted to $75.1 million whereas time charter expenses for the year were $11.6 million. Other expenses including management fees and general and administrative expenses amounted to $13.1 million.
EBITDA for the year ended December 31, 2008 was $50.1 million (please see Reconciliation of Non-GAAP Financial Measures on Exhibit 3).
The increase in the reserve for estimated maintenance and replacement capital expenditures for the year ended December 31, 2008 was $9.9 million. Maintenance and replacement capital expenditures represent expenditures required to maintain, over the long term the operating capacity of Navios Partners' capital assets.
Navios Partners generated an operating surplus for the period of $32.1 million. Operating surplus is a non-GAAP financial measure used by certain investors to measure the financial performance of Navios Partners and other master limited partnerships (please see Reconciliation of Non-GAAP Financial Measures on Exhibit 3).
Depreciation and amortization expense for the period (including amortization of drydocking and special survey costs presented under direct vessel expenses) was $12.4 million and interest expense and finance cost related to $235.0 million of borrowings under Navios Partners' facility agreement was $9.2 million.
Net income for the year ended December 31, 2008 was $28.8 million.
Fleet Employment Profile
The following table reflects certain key indicators indicative of the performance of Navios Partners and its core fleet performance for the quarter and the year ended December 31, 2008.
(1)Available days for fleet are total calendar days the vessels were in our possession for the relevant period after subtracting off-hire days associated with major repairs, drydockings or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which vessels should be capable of generating revenues.
(2)Operating days is 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 our 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 a company's efficiency in finding suitable employment for its vessels.
Conference Call Details:
As previously announced, Navios Partners' management will host a conference call to discuss the results today, Thursday, January 29, 2009, at 8:30 am EST. Participants should dial into the call 10 minutes before the scheduled time using the following numbers:
US Toll Free Dial In: +1866 819 7111
UK Toll Free Dial In: +0800 953 0329
International Dial In: +44 (0) 1452 542 301
Please quote "NAVIOS MLP".
A telephonic replay of the conference call will be available until February 5, 2009 by dialing the following numbers:
US Toll Free Dial In: +1866 247 4222
UK Toll Free Dial In: +0800 953 1533
International Dial In: +44 1452 550 000
Access Code: 33433537#
Slides and Audio Webcast
There will also be a live, and then archived 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 Maritime Partners L.P. website at www.navios-mlp.com under the "Investors" section at 7:45 am EST.
ABOUT NAVIOS MARITIME PARTNERS L.P.
Navios Maritime Partners L.P. (NYSE: NMM), a publicly traded master limited partnership formed by Navios Maritime Holdings Inc (NYSE: NM) is an owner and operator of Capesize and Panamax 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 and Navios Partners' growth strategy and measures to implement such strategy; including expected vessel acquisitions and entering into further time charters. Words such as "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. Although the 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 changes in the demand for dry bulk vessels, 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 the Navios Partners' filings with the Securities and Exchange Commission. 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.
Public & Investor Relations Contact:
Navios Maritime Partners L.P.
Capital Link, Inc.
Tel. (212) 661-7566
Exhibit 2 displays the "core fleet" employment profile of Navios Partners.