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Navios Maritime Acquisition Reports Financial Results for the Fourth Quarter and 2011 Year

Friday, 17 February 2012 | 00:00
Navios Maritime Acquisition Corporation, an owner and operator of tanker vessels, yesterday reported its financial results for the fourth quarter and year ended December 31, 2011.Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition, stated, "In two years, we have built a diverse fleet of 29 tanker vessels with an average age of less than 5.2 years. More than half of our fleet, or 15 vessels, are in the water, with almost 90% of the days fixed for 2012. With our low operating costs, we have a low cash flow break even and significant upside in both 2012 and 2013 through profit sharing and open days. As a sign of our continued confidence in Navios Acquisition's cash flow, today we announced a quarterly dividend of $.05 per share, representing a yield of more than 6.0%, to shareholders."
Angeliki Frangou continued, "We like our competitive position in the product tanker segment. Our fleet consists of 22 product tankers, of which eight are in the water. Nine of the remaining product tankers will be delivered during 2012. We have been able to acquire the product tankers at historically low levels, on an inflation adjusted basis, and have entered into charter agreements with oil majors and other credit worthy counterparties that hedge the risk of a difficult market."
HIGHLIGHTS -- RECENT DEVELOPMENTS
Dividend of $0.05 per Share of Common Stock

On February 13, 2012, the Board of Directors of Navios Acquisition declared a quarterly cash dividend for the fourth quarter of 2011 of $0.05 per share of common stock. The dividend is payable on April 5, 2012 to stockholders of record as of March 22, 2012. The declaration and payment of any further dividends remains subject to the discretion of the Board and will depend on, among other things, Navios Acquisition's cash requirements as measured by market opportunities, restrictions under its credit agreements and other debt obligations and such other factors as the Board may deem advisable.
Acquisition of three MR2 Newbuild vessels
In January 2012, Navios Acquisition concluded the acquisition of three new build MR2 product tankers scheduled to be delivered from a South Korean shipyard in the second, third and fourth quarter of 2014, respectively. The acquisition price is $106.5 million and will be partially financed with two new credit facilities totaling $84.4 million. The new credit facilities have maturity of eight years, amortization profile of 18.0 years and bear an interest rate of LIBOR plus (i) 175 bps prior to delivery of the vessels and (ii) 250 bps thereafter for the next 2.5 years and (iii) 300 bps for the remaining period. The credit facilities also require compliance with certain financial covenants.
Delivery of the Nave Estella
On January 20, 2012, Navios Acquisition took delivery of the Nave Estella, a 75,000 dwt LR1 product tanker, from a South Korean shipyard. The vessel was immediately chartered-out to an oil-major at a net rate of $11,850 per day for a period of three years plus two one year options. The charter also provides for 90% profit sharing up to $15,000 plus 50/50% profit sharing above $15,000. The profit sharing formula is calculated monthly and incorporates a $2,000 premium above the relevant index.
Time Charter Coverage
As of February 15, 2012, Navios Acquisition had contracted 89.4%, 58.4% and 50.4% of its available days on a charter-out basis for 2012, 2013 and 2014, respectively, equivalent to $146.4 million, $147.1 million and $133.9 million of revenue, respectively. The average contractual daily charter-out rate for the fleet is $26,647, $26,874 and $26,714 for 2012, 2013 and 2014, respectively.
Three month periods ended December 31, 2011 and 2010
Revenue for the three month period ended December 31, 2011 increased by $14.3 million or 56.3% to $39.7 million, as compared to $25.4 million for the same period in 2010. The increase was mainly attributable to the delivery of the Nave Polaris in January 2011, the Shinyo Kieran in June 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011. As a result of the vessel acquisitions, available days of the fleet increased to 1,238 days for the three month period ended December 31, 2011, as compared to 802 days for the three month period ended December 31, 2010. The time charter equivalent ("TCE") rate decreased to $30,422 for the three month period ended December 31, 2011, from $31,701 for the three month period ended December 31, 2010.
Net income for the three month period ended December 31, 2011 amounted to $2.5 million compared to a $4.4 million loss for the three month period ended December 31, 2010. The increase in net income by $6.9 million was due to an $8.9 million increase in Adjusted EBITDA partially off-set by: (a) a $0.3 million increase in direct vessel expenses; (b) a $3.3 million increase of interest expenses and finance cost, net; (c) a $3.7 million increase in depreciation and amortization due to the acquisitions of the Nave Cosmos in October 2010, the Nave Polaris in January 2011, the Shinyo Kieran in June 2011, and the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011; (d) a $0.1 million decrease in interest income; and (e) a $5.4 million prepayment penalties and write-off of deferred financing costs incurred in the three month period ended December 31, 2010.
Adjusted EBITDA for the three months ended December 31, 2010, excludes $5.4 million of prepayment fees and write-off of deferred financing costs. Adjusted EBITDA increased by $8.9 million to $26.3 million for the three month period ended December 31, 2011, as compared to $17.4 million for the same period of 2010. The increase in Adjusted EBITDA was due to a $14.3 million increase in revenue following the acquisition of the Nave Polaris in January 2011, the Shinyo Kieran that was delivered in June 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011. The above increase was partially offset by: (a) a $3.1 million increase in management fees due to the increased number of vessels in Navios Acquisition's fleet; (b) $1.7 million in time charter expenses; (c) a $0.2 million increase in general and administrative expenses as a result of the increased number of vessels in Navios Acquisition's fleet; and (d) a $0.4 million decrease in other net income.
Years ended December 31, 2011 and 2010
Revenue for the year ended December 31, 2011 increased by $88.3 million or 262.8% to $121.9 million, as compared to $33.6 million for the same period in 2010. The increase was mainly attributable to the acquisitions of the Nave Cielo (ex. Colin Jacob) and the Nave Ariadne (ex. Ariadne Jacob) in July 2010, seven VLCCs (the "VLCC Acquisition") in September 2010, of which the Shinyo Kieran was delivered in June 2011, the Nave Cosmos in October 2010, the Nave Polaris in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011. As a result of the vessel acquisitions, available days of the fleet increased to 4,053 days for the year ended December 31, 2011, as compared to 1,104 days for the year ended December 31, 2010. The TCE rate decreased to $29,218 for the year ended December 31, 2011, from $30,087 for the year ended December 31, 2010.
Net loss for the year ended December 31, 2011 amounted to $3.9 million compared to a $13.5 million loss for the year ended December 31, 2010. The decrease in net loss of $9.6 million was due to (a) a $56.1 million increase in Adjusted EBITDA; (b) a $0.6 million increase in interest income; (c) $2.1 million of shared based compensation incurred in the year ended December 31, 2010; (d) a $4.5 million decrease in prepayment penalties and write-off of deferred financing costs; and (e) $8.0 million of transactions costs incurred in the year ended December 31, 2010 partially offset by a $0.6 million increase in direct vessel expenses, a $32.5 million increase in interest expenses and finance cost net, and a $28.5 million increase in depreciation and amortization due to the acquisitions of the Nave Cielo (ex. Colin Jacob) and the Nave Ariadne (ex. Ariadne Jacob) in July 2010, seven VLCCs (the "VLCC Acquisition") in September 2010, of which the Shinyo Kieran was delivered in June 2011, the Nave Cosmos in October 2010, the Nave Polaris in January 2011 and the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011.
Adjusted EBITDA for the year ended December 31, 2011, excludes $0.9 million of write-off of deferred finance costs incurred in connection with the cancellation of committed credit. Adjusted EBITDA for the year ended December 31, 2010, excludes $8.0 million of transaction costs for the VLCC Acquisition, $2.1 million of share based compensation and $5.4 million of prepayment fees and write-off of deferred financing costs. Adjusted EBITDA increased by $56.1 million to $78.1 million for the year ended December 31, 2011, as compared to $22.0 million for the same period of 2010. The increase in Adjusted EBITDA was due to an $88.3 million increase in revenue following the acquisitions of the Nave Cielo (ex. Colin Jacob) and the Nave Ariadne (ex. Ariadne Jacob) in July 2010, the VLCC Acquisition in September 2010, of which the Shinyo Kieran was delivered in June 2011, the Nave Cosmos in October 2010, the Nave Polaris in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011. The above increase was partially offset by a: (a) $25.9 million increase in management fees due to the increased number of vessels in Navios Acquisition's fleet; (b) $3.1 million increase in time charter expenses; (c) $2.4 million increase in general and administrative expenses; and (d) $0.8 million increase in other net income.
Source: Navios Maritime Acquisition Corporation
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