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Navios Maritime Partners L.P. To Offer Some Insulation Against Cyclicality Says Angeliki Frangou

Navios Maritime Partners L.P., an international owner and operator of dry cargo vessels, today reported its financial results for the first quarter ended 2021.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Partners, stated, “I am pleased with the results for the first quarter of 2021. During the first quarter, total revenue of Navios Partners and Navios Containers, was $108.8 million and total adjusted EBITDA was $56.4 million.”

Angeliki Frangou continued, “Navios Partners today is a top-ten publicly listed dry cargo fleet company with 89 vessels comprised of 51 dry bulk vessels and 38 containerships. We expect that our diversified fleet will benefit from the distinct industry drivers while also offering some insulation against cyclicality. For example, given the ongoing strength in the container industry, we fixed about 89% of available days. In contrast, in the dry bulk segment, we have over 62% of available days open or on index linked charters so that we can capture further market firming. We believe these two segments housed in a single company strengthen our business.”

Merger with Navios Maritime Containers L.P.

On March 31, 2021, Navios Partners completed the merger contemplated by the Agreement and Plan of Merger (the “Merger Agreement”), dated as of December 31, 2020, by and among Navios Partners, its direct wholly-owned subsidiary NMM Merger Sub LLC (“Merger Sub”), Navios Maritime Containers L.P. (“Navios Containers”) and Navios Maritime Containers GP LLC, Navios Containers’ general partner. Pursuant to the Merger Agreement, Merger Sub merged with and into Navios Containers, with Navios Containers continuing as the surviving partnership. As a result of the Merger, Navios Containers became a wholly-owned subsidiary of Navios Partners. Pursuant to the terms of the Merger Agreement, each outstanding common unit of Navios Containers that was held by a unitholder other than Navios Partners, Navios Containers and their respective subsidiaries was converted into the right to receive 0.39 of a common unit of Navios Partners. As a result of the Merger, 8,133,452 common units of Navios Partners were issued to former public unitholders of Navios Containers. The results of operations of Navios Containers will be included in Navios Partner’s consolidated statements of operations commencing on April 1, 2021.

Fleet Update Year-To-Date

Acquisition of 29 Containerships
Following the completion of the merger with Navios Containers on March 31, 2021, the 29-vessel fleet of Navios Containers is included in Navios Partners owned fleet.

Acquisition of three Containerships
In April 2021, Navios Partners agreed to acquire from Navios Maritime Acquisition Corporation (“Navios Acquisition”) (NYSE:NNA) the Ete N, a 2012 built Containership of 2,782 TEU, the Fleur N, a 2012 built Containership of 2,782 TEU, and the Spectrum N, a 2009 built Containership of 2,546 TEU for a purchase price of $55.5 million. The vessels are expected to be delivered into Navios Partners’ fleet during the second quarter of 2021.

Acquisition of one Capesize Vessel
In April 2021, Navios Partners agreed to acquire from Navios Maritime Holdings Inc. (“Navios Holdings”) (NYSE:NM) a 2011 built Capesize vessel for a purchase price of $28.5 million. The vessel is expected to be delivered into Navios Partners’ fleet during the second quarter of 2021.

Acquisition of two Kamsarmax Vessels
In March, 2021, Navios Partners agreed to acquire from Navios Holdings the Navios Avior, a 2012 built Kamsarmax vessel of 81,355 dwt, and the Navios Centaurus, a 2012 built Kamsarmax vessel of 81,472 dwt. On March 30, 2021, Navios Partners completed the acquisition of the two vessels from Navios Holdings for a purchase price of $39.3 million, including working capital adjustments.

Acquisition of one Newbuilding Kamsarmax Vessel
In March, 2021, Navios Partners agreed to acquire from an unrelated third party a newbuilding Kamsarmax vessel for a purchase price of $31.6 million. The vessel has approximately 81,000 dwt and is expected to be delivered into Navios Partners’ fleet during the second half of 2022.

Four Bareboat Charter-in Newbuilding Capesize Vessels
In January, 2021, Navios Partners agreed to bareboat charter-in three Japanese newbuilding Capesize vessels from an unrelated third party. Each vessel has approximately 180,000 dwt and is being bareboat chartered-in for 15 years. Navios Partners has the option to acquire the vessels starting at the end of year four until the end of the charter period. Assuming exercise of the option at the end of the 15-year period, the bareboat agreements reflect an implied price of approximately $51.5 million per vessel and an annual effective interest of approximately 4.4%. The vessels are expected to be delivered into Navios Partners’ fleet during the second half of 2022.

In March, 2021, Navios Partners agreed to bareboat charter-in one Japanese newbuilding Capesize vessel from an unrelated third party. The vessel has approximately 180,000 dwt and is being bareboat chartered-in for 15 years. Navios Partners has the option to acquire the vessel starting at the end of year four until the end of the charter period. Assuming exercise of the option at the end of the 15-year period, the bareboat agreement reflects an implied price of approximately $51.5 million and an annual effective interest of approximately 5.0%. The vessel is expected to be delivered into Navios Partners’ fleet during the first half of 2023.

$ 66.7 million Sale of Five Vessels
In April 2021, Navios Partners, agreed to sell the Navios Dedication, a 2008-built Containership of 4,250 TEU to an unrelated third party for a net sale price of $33.9 million. The sale is expected to be completed during the second quarter of 2021.

On March 25, 2021, Navios Partners completed the sale of the Joie N, a 2011-built Ultra-Handymax vessel of 56,557 dwt, to an unrelated third party, for a net sale price of $8.2 million.

On February 10, 2021, Navios Partners completed the sale of the Castor N, a 2007-built Containership of 3,091 TEU to an unrelated third party for a net sale price of $8.9 million.

On January 28, 2021, Navios Partners completed the sale of the Solar N, a 2006-built Containership of 3,398 TEU to an unrelated third party for a net sale price of $11.1 million.

On January 13, 2021, Navios Partners completed the sale of the Esperanza N, a 2008-built Containership of 2,007 TEU to an unrelated third party for a net sale price of $4.6 million.

Current Fleet
Following the above transactions, on a fully delivered basis, our fleet consists of 89 vessels, 51 dry bulk vessels and 38 containerships with a total capacity of 8.2 million dwt.

Financing Arrangements

In April 2021, Navios Partners received credit approval for a new credit facility with a commercial bank for a total amount of up to $160.0 million in order to: (i) refinance its existing facility maturing in August 2021; (ii) refinance one dry bulk vessel; and (iii) finance the acquisition of one dry bulk vessel. The new facility is expected to have an amortization profile of approximately 8 years, will mature in the second quarter of 2025 and will bear interest at LIBOR plus 3.0% per annum.

In April 2021, Navios Partners received credit approval for a new credit facility with a commercial bank for a total amount of up to $43.0 million in order to refinance six dry bulk vessels. The new facility will have an amortization profile of 8 years and will mature in the second quarter of 2026 and will bear interest at LIBOR plus 3.0% per annum.

The above facilities remain subject to completion of definitive documentation and are expected to close in the second quarter of 2021. No assurance can be provided that the transactions will be completed in full or in part.

In April 2021, Navios Partners entered into a new credit facility with a commercial bank for a total amount of $40.0 million in order to refinance two dry bulk vessels and to finance the acquisition of two containerships. The new facility will have an amortization profile of 7 years and will mature in the second quarter of 2025 and bear interest at LIBOR plus 2.85% per annum.

In April 2021, Navios Partners entered into a new credit facility with a commercial bank for a total amount of $8.9 million in order to finance the acquisition of one containership. The new facility will have an amortization profile of 7 years and will mature in the fourth quarter of 2024 and bear interest at LIBOR plus 3.0% per annum. On April 28, 2021, the entire amount was drawn under this loan.

On March 23, 2021, Navios Partners entered into a new credit facility with a commercial bank for a total amount of $58.0 million in order to refinance two dry bulk vessels and to finance the acquisition of the Navios Avior and the Navios Centaurus. The credit facility matures in March 2026 and bears interest at LIBOR plus 3% per annum. On March 30, 2021, the entire amount was drawn under this loan.

In January and March 2021, Navios Partners entered into four bareboat charter-in agreements for four Japanese newbuilding Capesize vessels. The total implied amount financed for the three vessels is approximately $144.0 million and for the fourth is approximately $48.0 million and the implied effective interest rate is 4.4% and 5.0%, respectively.

Cash Distribution

The Board of Directors of Navios Partners declared a cash distribution for the first quarter of 2021 of $0.05 per unit. The cash distribution is payable on May 14, 2021 to all unitholders of record as of May 11, 2021. 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 1.4 years. Navios Partners has currently contracted out 77.0% of its available days for the remaining nine months of 2021, 33.2% for 2022 and 17.3% for 2023, including index-linked charters. Excluding index-linked charters, Navios Partners Group expects to generate revenues of approximately $278.9 million, $218.6 million and $120.0 million, respectively. The Average Expected daily charter-out rate for the fleet is $20,000 for the remaining nine months 2021, $24,343 for 2022 and $26,588 for 2023.

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 month periods ended March 31, 2021 and 2020. The quarterly information was derived from the unaudited condensed consolidated financial statements for the respective periods. EBITDA, Adjusted EBITDA, Adjusted Earnings per Common Unit and Adjusted Net Income are non-GAAP financial measures and should not be used in isolation or substitution for Navios Partners’ results calculated in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Navios Partners results of operations for the three month period ended March 31, 2021 do not include Navios Containers results. The results of operations of Navios Containers will be included in Navios Partner’s consolidated statements of operations commencing on April 1, 2021. The column “Total” below presents the aggregate results of operations for Navios Partners and Navios Containers for the three month period ended March 31, 2021, and doesn’t include all adjustments that would have been accounted for, had the transaction been completed on January 1, 2021.

Full Report

Source: Navios Maritime Partners L.P.

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