- $140.3 million revenue for Q1 2019
- $18.3 million net cash from operating activities for Q1 2019
- $68.5 million Adjusted EBITDA for Q1 2019
- 7.375% Senior Mortgage Notes – $35.5 million buy-back
- 11.25% Senior Secured Notes – collateral substitution
- Completed Exchange Offer
- Owned-fleet renewal – improved average age by 20%
- Positioned to capture market recovery; 8,201 days of market exposure
MONACO, May 28, 2019 (GLOBE NEWSWIRE) -- Navios Maritime Holdings Inc. ("Navios Holdings" or "the Company") (NYSE: NM), a global, vertically integrated seaborne shipping and logistics company, today reported financial results for the first quarter ended March 31, 2019.
Angeliki Frangou, Chairman and Chief Executive Officer, stated, “I am pleased with the results of the first quarter of 2019, for which we reported revenue of $140.3 million and Adjusted EBITDA of $68.5 million.”
Angeliki Frangou continued, “We are continuing to develop our logistics chain in South America. We are in the preliminary stages of constructing a modern upriver port facility in Mato Grosso do Sul, a fertile region exporting grains. This new port should provide a service to the region and create additional volume on the river for our barge business and grain transshipment terminal in Uruguay.”
HIGHLIGHTS – RECENT DEVELOPMENTS
Debt Updates
During March 2019 and as of April 15, 2019, Navios South American Logistics Inc. (“Navios Logistics”) repurchased a total of $35.5 million in par value of its 7.375% First Priority Ship Mortgage Notes due 2022 (“2022 Notes”) from unaffiliated third parties in open market transactions for $17.6 million. On April 25, 2019, Navios Holdings entered into a secured credit facility of $50.0 million with Navios Logistics to be used for general corporate purposes, including the repurchase from time to time of the Company’s 7.375% First Priority Ship Mortgage Notes due 2022 (the “2022 Notes”). The secured credit facility is available in multiple drawings, bears interest at a fixed rate of 12.75% for the first year and 14.75% for the second year, payable annually, and matures in April 2021. As of April 25, 2019, $19.0 million was drawn under this facility of which $18.7 million was used to acquire the 2022 Notes from Navios Logistics.
In May 2019, Navios Holdings released its Navios Maritime Partners L.P. ownership and 224,116 Navios Maritime Acquisition Corporation shares that were collateral under the 11.25% Senior Secured Notes and were replaced by one Capesize vessel.
In May 2019, Navios Holdings agreed the main terms for the extension of $39.5 million maturities from 2020 to June 2021.
Completion of Tender Offer for the Company’s Preferred Stock
As of March 21, 2019, a total of 10,930 Series H were validly tendered in exchange for a total of approximately $4.2 million of cash consideration and approximately $4.7 million in aggregate principal amount of the Company’s newly issued 9.75% Senior Notes due 2024 (the “2024 Notes”). As of April 18, 2019, a total of 8,841 Series G were validly tendered in exchange for a total of approximately $4.4 million of cash consideration and approximately $3.9 million in aggregate principal amount of 2024 Notes.
Fleet Update
From the beginning of 2018 through 2019 YTD, Navios Holdings has decreased the average age of its owned fleet by 20% and decreased its owned fleet capacity by 2%.
In May 2019, the Company agreed to acquire a former chartered-in vessel, the Sea Victory (TBN Navios Victory), a 2014-built Panamax vessel of 77,095 dwt, for a purchase price of $14.5 million. The acquisition is expected to be completed in Q3 2019.
On May 3, 2019, the Company sold to an unrelated third party the Navios Equator Prosper, a 2000-built Capesize vessel of 171,191 dwt, for a total net sale price of $11.5 million, paid in cash.
In April and May 2019, the Company agreed to sell to unrelated third parties the Navios Mercator, a 2002-built Ultra Handymax vessel of 53,553 dwt for a total net sale price of $6.7 million and the Navios Vector, a 2002-built Ultra Handymax vessel of 50,296 dwt for a total net sale price of $6.9 million, in each case to be paid in cash. Closing is expected in Q2 and Q3 of 2019.
Navios Holdings controls a fleet of 60 vessels (including two vessels expected to be sold) totaling 6.2 million dwt, of which 33 are owned and 27 are chartered-in under long-term charters (collectively, the "Core Fleet"). The fleet consists of 18 Capesize, 28 Panamax, 12 Ultra-Handymax and two Handysize vessels, with an average age of 7.7 years, basis fully delivered fleet.
As of May 20, 2019, Navios Holdings has chartered-out 82.6% of available days for the remaining nine months of 2019, out of which 42.9% are chartered-out on fixed rate and 39.7% on index. The average contracted daily charter-in rate for the long-term charter-in vessels for the remaining nine months of 2019 is $13,852 per day.
The above figures do not include the fleets of Navios Logistics and Navios Maritime Containers L.P. (“Navios Containers”) and vessels servicing contracts of affreightment.
Exhibit II provides certain details of the Core Fleet of Navios Holdings. It does not include the fleets of Navios Logistics and Navios Containers.
Earnings Highlights
EBITDA, Adjusted EBITDA, Adjusted Net Income/(Loss) 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 Income/(Loss) 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 Navios Containers), and EBITDA of Navios Logistics and Navios Containers (both 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 Containers and consequently consolidated Navios Containers from that date onwards.
First Quarter 2019 and 2018 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):
The first quarter 2019 and 2018 information presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.
| Three Month Period Ended | Three Month Period Ended | Three Month Period Ended | ||||||||
| March 31, | March 31, 2019 | March 31, | ||||||||
| 2019 | Excluding Navios Containers | 2018 | ||||||||
| (unaudited) | (unaudited) | (unaudited) | ||||||||
| Revenue | $ | 140,280 | $ | 108,448 | $ | 116,882 | ||||
| Net Loss attributable to Navios Holdings’ common stockholders | $ | (5,304) | $ | (5,294) | $ | (40,857) | ||||
| Adjusted Net Income/(Loss) attributable to Navios Holdings’ common stockholders | $ | 227 | (1) | $ | 237 | $ | (34,142) | (3) | ||
| Net cash provided by operating activities | $ | 18,323 | $ | 18,360 | $ | 17,806 | ||||
| EBITDA | $ | 63,002 | $ | 50,724 | $ | 21,383 | ||||
| Adjusted EBITDA | $ | 68,533 | (1) | $ | 56,255 | $ | 28,098 | (3) | ||
| Basic Earnings/(Loss) attributable to Navios Holdings’ common stockholders per Share(4) | $ | 1.32 | $ | 1.33 | $ | (3.53) | ||||
| Adjusted Basic Loss attributable to Navios Holdings’ common stockholders per Share(4) | $ | (0.19) | (2) | $ | (0.19) | $ | (2.98) | (3) | ||
| (1) | Adjusted EBITDA and Adjusted Net Income attributable to Navios Holdings’ common stockholders for the three months ended March 31, 2019 exclude $5.5 million of impairment losses related to the sale of one drybulk vessel. |
| (2) | Adjusted Basic Loss attributable to Navios Holdings’ common stockholders per Share for the three months ended March 31, 2019 exclude the item referred in footnote (1) above as well as a gain of $24.0 million related to the tender offer for the Company‘s preferred stock discussed under “Highlights - Recent Developments - Completion of Tender Offer for the Company’s Preferred Stock”. |
| (3) | Adjusted EBITDA, Adjusted Net Loss attributable to Navios Holdings’ common stockholders and Adjusted Basic Loss attributable to Navios Holdings’ common stockholders per Share for the three months ended March 31, 2018 exclude $6.7 million of impairment losses related to the sale of one drybulk vessel. |
| (4) | Basic and Adjusted Basic Earnings/(Loss) attributable to Navios Holdings’ common stockholders per Share post reverse stock split adjusted for all periods presented. |
Revenue from dry bulk vessel operations for the three months ended March 31, 2019 was $52.7 million, as compared to $64.7 million for the same period during 2018. The decrease in dry bulk revenue was mainly attributable to the decrease in the time charter equivalent (“TCE”) per day by 12.4% to $9,622 per day in the first quarter of 2019, as compared to $10,983 per day in the same period of 2018.
Revenue from the logistics business was $55.8 million for the three months ended March 31, 2019 as compared to $52.2 million for the same period in 2018. The increase was mainly attributable to (i) a $1.8 million increase in revenue from the barge business mainly due to an increase in the amount of dry and liquid cargo moved, (ii) a $1.2 million increase in revenue from the cabotage business mainly due to an increase in operating days of the cabotage fleet; and (iii) a $0.6 million increase in revenue from port terminal business, mainly due to more volumes transshipped in the grain port terminal.
Revenue of Navios Containers for the three months ended March 31, 2019 was $31.8 million and consisted of time charter revenues. Navios Containers’ results of operations were not included in the Company’s consolidated results of operations for the three months ended March 31, 2018.
Net Loss attributable to Navios Holdings’ common stockholders was $5.3 million for the three months ended March 31, 2019, as compared to $40.9 million Net Loss attributable to Navios Holdings’ common stockholders for the same period in 2018. Net Loss attributable to Navios Holdings’ common stockholders was affected by items described in the table above. Excluding these items, Adjusted Net Income attributable to Navios Holdings’ common stockholders for the three months ended March 31, 2019 was $0.2 million, as compared to $34.1 million Adjusted Net Loss attributable to Navios Holdings’ common stockholders for the same period in 2018. This increase in Adjusted Net Income was mainly due to (i) a $40.4 million increase in Adjusted EBITDA, (ii) a $0.6 million decrease in amortization for deferred drydock and special survey costs, and (iii) a $0.4 million decrease in share-based compensation expense. This overall increase of $41.4 million was partially mitigated by (i) a $3.7 million increase in depreciation and amortization, (ii) a $2.6 million increase in interest expense and finance cost, net, and (iii) a $0.8 million decrease in income tax benefit.
Net Income of Navios Logistics, on a standalone basis, was $5.3 million for the three month period ended March 31, 2019 as compared to $1.0 million Net Loss for the same period in 2018.
Net Loss of Navios Containers, on a standalone basis, was $0.2 million for the three month period ended March 31, 2019. Navios Containers’ results of operations were not included in the Company’s consolidated results of operations for the three month period ended March 31, 2018.
Adjusted EBITDA of Navios Holdings for the three month period ended March 31, 2019 increased by $40.4 million to $68.5 million, as compared to $28.1 million for the same period in 2018. The increase in Adjusted EBITDA was primarily due to (i) a $23.4 million increase in revenue, (ii) a $15.7 million increase in gain on bond extinguishment, (iii) a $10.8 million increase in equity in net earnings from affiliated companies, (iv) a $10.2 million increase in other income, net, and (v) a $1.9 million decrease in time charter, voyage and logistics business expenses. This overall increase of $62.0 million was partially offset by (i) a $15.9 million increase in direct vessel expenses (excluding the amortization of deferred drydock and special survey costs), (ii) a $3.6 million increase in general and administrative expenses (excluding share-based compensation expenses), and (iii) a $2.1 million decrease in net loss attributable to noncontrolling interest.
EBITDA of Navios Logistics, on a standalone basis, was $24.2 million for the three month period ended March 31, 2019, as compared to $16.8 million for the same period in 2018.
EBITDA of Navios Containers, on a standalone basis, was $12.0 million for the three month period ended March 31, 2019.
Fleet Summary Data:
The following table reflects certain key indicators indicative of the performance of Navios Holdings' dry bulk operations (excluding the Navios Logistics and Navios Containers fleets) and its fleet performance for the three month periods ended March 31, 2019 and 2018, respectively.
| Three Month | Three Month | ||||
| Period Ended | Period Ended | ||||
| March 31, | March 31, | ||||
| 2019 | 2018 | ||||
| (Unaudited) | (Unaudited) | ||||
| Available Days (1) | 5,337 | 5,554 | |||
| Operating Days (2) | 5,313 | 5,517 | |||
| Fleet Utilization (3) | 99.5% | 99.3% | |||
| Equivalent Vessels (4) | 59 | 62 | |||
| TCE (5) | $ | 9,622 | $ | 10,983 | |
| (1) | Available days for the fleet are total calendar days the vessels were in Navios Holdings' possession for the relevant period after subtracting off-hire days associated with scheduled repairs, drydocking or special surveys and ballast days relating to voyages. 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 are 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 Navios Holdings' 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. The shipping industry uses fleet utilization to measure a company's efficiency in finding suitable employment for its vessels. |
| (4) | Equivalent Vessels is defined as the total available days during a relevant period divided by the number of days of this period. |
| (5) | TCE 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 Holdings will host a conference call today, May 28, 2019, at 8:30 am ET, at which time Navios Holdings' senior management will provide highlights and commentary on earnings results for the first quarter ended March 31, 2019.
A supplemental slide presentation will be available on the Navios Holdings website at www.navios.com under the "Investors" section by 8:00 am ET on the day of the call.
Conference Call details:
Call Date/Time: Tuesday, May 28, 2019 at 8:30 am ET
Call Title: Navios Holdings Q1 2019 Financial Results Conference Call
US Dial In: +1.877.480.3873
International Dial In: +1.404.665.9927
Conference ID: 334 8718
The conference call replay will be available shortly 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: 334 8718
This call will be simultaneously Webcast. The Webcast will be available on the Navios Holdings website, www.navios.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 Holdings Inc.
Navios Maritime Holdings Inc. (NYSE: NM) is a global, vertically integrated seaborne shipping and logistics company focused on the transport and transshipment of dry bulk commodities including iron ore, coal and grain. For more information about Navios Holdings please visit our website: www.navios.com.
About Navios South American Logistics Inc.
Navios South American Logistics Inc. is one of the largest logistics companies in the Hidrovia region of South America, focusing on the Hidrovia region river system, the main navigable river system in the region, and on cabotage trades along the eastern coast of South America. Navios Logistics serves the storage and marine transportation needs of its petroleum, agricultural and mining customers through its port terminals, river barge and coastal cabotage operations. For more information about Navios Logistics please visit its website: www.navios-logistics.com.
About Navios Maritime Containers L.P.
Navios Maritime Containers L.P. (NASDAQ: NMCI) is a growth vehicle dedicated to the container sector of the maritime industry. For more information, please visit its website at www.navios-containers.com.
About Navios Maritime Partners L.P.
Navios Maritime Partners L.P. (NYSE: NMM) is a publicly traded master limited partnership which owns and operates dry cargo vessels. For more information, please visit its website at www.navios-mlp.com.
About Navios Maritime Acquisition Corporation
Navios Acquisition (NYSE: NNA) is an owner and operator of tanker vessels focusing on the transportation of petroleum products (clean and dirty) and bulk liquid chemicals. For more information about Navios Acquisition, please visit its website: www.navios-acquisition.com.
Forward Looking Statements - Safe Harbor
This press release and our earnings call contain and will contain 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 expected cash flow generation, future contracted revenues, potential capital gains, our ability to take advantage of dislocation in the market and any market recovery, and Navios Holdings' growth strategy and measures to implement such strategy; including expected vessel acquisitions 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. Such statements include comments regarding expected revenue and time charters. These forward-looking statements are based on the information available to, and the expectations and assumptions deemed reasonable by Navios Holdings at the time these statements were made. Although Navios Holdings 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 Holdings. 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 uncertainty relating to global trade, including prices of seaborne commodities and continuing issues related to seaborne volume and ton miles, our continued ability to enter into long-term time charters, our ability to maximize the use of our vessels, expected demand in the dry cargo shipping sector in general and the demand for our Panamax, Capesize and Ultra Handymax vessels in particular, fluctuations in charter rates for dry cargo carriers vessels, the aging of our fleet and resultant increases in operations costs, the loss of any customer or charter or vessel, the financial condition of our customers, changes in the availability and costs of funding due to conditions in the bank market, capital markets and other factors, increases in costs and expenses, including but not limited to: crew wages, insurance, provisions, port expenses, lube oil, bunkers, repairs, maintenance, and general and administrative expenses, the expected cost of, and our ability to comply with, governmental regulations and maritime self-regulatory organization standards, as well as standard regulations imposed by our charterers applicable to our business, general domestic and international political conditions, competitive factors in the market in which Navios Holdings operates, the value of our publicly traded subsidiaries, risks associated with operations outside the United States, and other factors listed from time to time in Navios Holdings' filings with the Securities and Exchange Commission, including its Forms 20-F and Forms 6-K. Navios Holdings 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 Holdings' expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. Navios Holdings makes no prediction or statement about the performance of its common stock or debt securities.
Contact:
Navios Maritime Holdings Inc.
+1.212.906.8643
investors@navios.com
| EXHIBIT I | |||||
| NAVIOS MARITIME HOLDINGS INC. | |||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
| (Expressed in thousands of U.S. dollars — except share and per share data) | |||||
| Three Month Period Ended March 31, 2019 | Three Month Period Ended March 31, 2018 | ||||
| (unaudited) | (unaudited) | ||||
| Revenue | $ | 140,280 | $ | 116,882 | |
| Administrative fee revenue from affiliates | 6,464 | 7,005 | |||
| Time charter, voyage and logistics business expenses | (49,644) | (51,495) | |||
| Direct vessel expenses(1) | (39,436) | (24,264) | |||
| General and administrative expenses incurred on behalf of affiliates | (6,464) | (7,005) | |||
| General and administrative expenses(2) | (10,026) | (6,927) | |||
| Depreciation and amortization | (29,785) | (26,066) | |||
| Interest expense and finance cost, net | (34,397) | (31,810) | |||
| Impairment losses on sale of vessels | (5,531) | (6,715) | |||
| Gain on bond extinguishment | 15,662 | — | |||
| Other income/(expense), net | 5,389 | (4,819) | |||
| Loss before equity in net earnings of affiliated companies | (7,488) | (35,214) | |||
| Equity in net earnings/(losses) of affiliated companies | 4,277 | (6,464) | |||
| Loss before taxes | $ | (3,211) | $ | (41,678) | |
| Income tax (expense)/benefit | (405) | 442 | |||
| Net loss | (3,616) | (41,236) | |||
| Less: Net (income)/ loss attributable to the noncontrolling interest | (1,688) | 379 | |||
| Net loss attributable to Navios Holdings’ common stockholders | $ | (5,304) | $ | (40,857) | |
| Income/(loss) attributable to Navios Holdings’ common stockholders, basic | $ | 16,190 | $ | (43,406) | |
| Income/(loss) attributable to Navios Holdings’ common stockholders, diluted | $ | 16,363 | $ | (43,406) | |
| Basic earnings/(loss) per share attributable to Navios Holdings common stockholders | $ | 1.32 | $ | (3.53) | |
| Weighted average number of shares, basic | 12,219,884 | 12,297,560 | |||
| Diluted earnings/(loss) per share attributable to Navios Holdings common stockholders | $ | 1.22 | $ | (3.53) | |
| Weighted average number of shares, diluted | 13,377,117 | 12,297,560 | |||
| (1) | Includes expenses of Navios Logistics of $12.6 million and $14.8 million for the three month period ended March 31, 2019 and 2018, respectively. Also includes expenses of Navios Containers of $15.9 million for the three month period ended March 31, 2019. |
| (2) | Includes expenses of Navios Logistics of $3.8 million and $3.9 million for the three month period ended March 31, 2019 and 2018, respectively. Also includes expenses of Navios Containers of $2.5 million for the three month period ended March 31, 2019. |
| NAVIOS MARITIME HOLDINGS INC. | |||||
| Other Financial Data | |||||
| March 31, 2019 | December 31, 2018 | ||||
| (unaudited) | (unaudited) | ||||
| ASSETS | |||||
| Cash and cash equivalents, including restricted cash | $ | 129,358 | $ | 150,774 | |
| Vessels, port terminal and other fixed assets, net | 1,867,810 | 1,898,455 | |||
| Goodwill and other intangibles | 292,138 | 299,273 | |||
| Operating lease assets | 349,100 | — | |||
| Other current and non-current assets | 354,774 | 333,994 | |||
| Total assets | $ | 2,993,180 | $ | 2,682,496 | |
| LIABILITIES AND EQUITY | |||||
| Long-term, debt, including current portion | 531,957 | 543,899 | |||
| Senior and ship mortgage notes, net | 1,247,052 | 1,272,108 | |||
| Operating lease liabilities, current portion | 92,438 | — | |||
| Operating lease liabilities, net of current portion | 270,109 | — | |||
| Other current and non-current liabilities | 342,764 | 344,809 | |||
| Total stockholders’ equity | 508,860 | 521,680 | |||
| Total liabilities and stockholders’ equity | $ | 2,993,180 | $ | 2,682,496 | |
Disclosure of Non-GAAP Financial Measures
EBITDA, Adjusted EBITDA, Adjusted Net Income/(Loss) attributable to Navios Holdings’ common stockholders and Adjusted Basic Loss per Share are “non-U.S. GAAP financial measures” and should not be used in isolation or considered substitutes 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 Holdings' common stockholders before interest and finance costs, before depreciation and amortization, before income taxes and before stock-based compensation. Adjusted EBITDA represents EBITDA, excluding certain items as described under “Earnings Highlights”. We use EBITDA and Adjusted EBITDA as liquidity measures and reconcile EBITDA and Adjusted EBITDA to net cash provided by operating activities, the most comparable U.S. GAAP liquidity measure. EBITDA is calculated as follows: net cash provided by 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 cost, (iv) deferred finance charges and gains/(losses) on bond and debt extinguishment, (v) (provision)/recovery for losses on accounts receivable, (vi) equity in affiliates, net of dividends received, (vii) payments for drydock and special survey costs, (viii) noncontrolling interest, (ix) gain/ (loss) on sale of assets/ subsidiaries and bargain gain, (x) unrealized (loss)/gain on derivatives, and (xi) loss on sale and reclassification to earnings of available-for-sale securities and impairment charges. Navios Holdings believes that EBITDA and Adjusted EBITDA are a basis upon which liquidity can be assessed and represents useful information to investors regarding Navios Holdings’ ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. Navios Holdings also believes that EBITDA and Adjusted EBITDA are 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 and Adjusted EBITDA are presented to provide additional information with respect to the ability of Navios Holdings to satisfy its respective obligations, including debt service, capital expenditures, working capital requirements and pay dividends. While EBITDA and Adjusted EBITDA are frequently used as measures of operating results and the ability to meet debt service requirements, the definitions of EBITDA and Adjusted EBITDA used here may not be comparable to those used by other companies due to differences in methods of calculation.
EBITDA and Adjusted EBITDA have limitations as an analytical tool, and therefore, should not be considered in isolation or as a substitute for the analysis of Navios Holdings’ results as reported under U.S. GAAP. Some of these limitations are: (i) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, working capital needs; (ii) EBITDA and Adjusted EBITDA do 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 and Adjusted EBITDA do not reflect any cash requirements for such capital expenditures. Because of these limitations, among others, EBITDA and Adjusted EBITDA should not be considered as a principal indicator of Navios Holdings’ performance. Furthermore, our calculation of EBITDA and Adjusted EBITDA may not be comparable to that reported by other companies due to differences in methods of calculation.
Navios Logistics EBITDA is used to measure its operating performance.
We present Adjusted Net Income/(Loss) attributable to Navios Holdings’ common stockholders because we believe it assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Our presentation of Adjusted Net Income/(Loss) attributable to Navios Holdings’ common stockholders adjusts net income/(loss) attributable to Navios Holdings’ common stockholders for the items described above under “Earnings Highlights”. The definition of Adjusted Net Income/(Loss) used here may not be comparable to that used by other companies due to differences in methods of calculation.
Adjusted Basic Loss attributable to Navios Holdings’ common stockholders Per Share is defined as Adjusted Loss attributable to Navios Holdings’ common stockholders divided by the weighted average number of shares for each of the periods presented.
The following tables provide a reconciliation of EBITDA and Adjusted EBITDA of Navios Holdings (including Navios Logistics and Navios Containers) and EBITDA of Navios Logistics and Navios Containers on a stand-alone basis:
| Navios Holdings Reconciliation of EBITDA and Adjusted EBITDA to Cash from Operations | |||||
| March 31, | March 31, | ||||
| Three Months Ended | 2019 | 2018 | |||
| (in thousands of U.S. dollars) | (unaudited) | (unaudited) | |||
| Net cash provided by operating activities | $ | 18,323 | $ | 17,806 | |
| Net increase in operating assets | 7,610 | 3,622 | |||
| Net decrease/(increase) in operating liabilities | 13,218 | (21,635) | |||
| Net interest cost | 34,397 | 31,810 | |||
| Deferred finance charges | (1,857) | (1,642) | |||
| Provision for losses on accounts receivable | (576) | (433) | |||
| Equity in affiliates, net of dividends received | 3,240 | (6,937) | |||
| Payments for drydock and special survey costs | 4,123 | 5,100 | |||
| Noncontrolling interest | (1,688) | 379 | |||
| Other gain on assets | — | 28 | |||
| Impairment losses on sale of vessels | (5,531) | (6,715) | |||
| Amortization of operating lease assets | (23,919) | — | |||
| Gain on bond extinguishment | 15,662 | — | |||
| EBITDA | $ | 63,002 | $ | 21,383 | |
| Impairment losses on sale of vessels | 5,531 | 6,715 | |||
| Adjusted EBITDA | $ | 68,533 | $ | 28,098 | |
| Three Month Period Ended (in thousands of U.S. dollars) | March 31, 2019 | March 31, 2018 | |||
| (unaudited) | (unaudited) | ||||
| Net cash provided by operating activities | $ | 18,323 | $ | 17,806 | |
| Net cash used in investing activities | $ | (6,606) | $ | (17,500) | |
| Net cash used in financing activities | $ | (33,133) | $ | (12,643) | |
| Adjusted EBITDA breakdown | |||||
| March 31, | March 31, | ||||
| Three Months Ended | 2019 | 2018 | |||
| (in thousands of U.S. dollars) | (unaudited) | (unaudited) | |||
| Adjusted EBITDA from core shipping operations | $ | 29,735 | $ | 17,377 | |
| Navios Logistics (including noncontrolling interest) | 22,243 | 17,185 | |||
| Navios Containers (including noncontrolling interest) | 12,278 | — | |||
| Equity in net earnings/(losses) of affiliated companies | 4,277 | (6,464) | |||
| Adjusted EBITDA | $ | 68,533 | $ | 28,098 | |
| Navios Logistics EBITDA Reconciliation to Net Income/(Loss) | |||||
| March 31, | March 31, | ||||
| Three Months Ended | 2019 | 2018 | |||
| (in thousands of U.S. dollars) | (unaudited) | (unaudited) | |||
| Net lncome/(loss) | $ | 5,305 | $ | (1,047) | |
| Depreciation and amortization | 7,346 | 7,228 | |||
| Amortization of deferred drydock and special survey costs | 1,326 | 1,890 | |||
| Interest expense and finance cost, net | 9,838 | 9,245 | |||
| Income tax expense/(benefit) | 347 | (510) | |||
| EBITDA | $ | 24,162 | $ | 16,806 | |
| Navios Containers Reconciliation of EBITDA to Cash from Operations | ||
| Three Months Ended | March 31, 2019 | |
| (in thousands of U.S. dollars) | (unaudited) | |
| Net cash used in operating activities | $ | (37) |
| Net increase in operating assets | 3,865 | |
| Net decrease in operating liabilities | 2,018 | |
| Net interest cost | 3,553 | |
| Deferred finance charges | (59) | |
| Payments for drydock and special survey costs | 2,707 | |
| EBITDA | $ | 12,047 |
| EXHIBIT II | ||||||
| Owned Vessels | ||||||
| Vessel Name | Vessel Type | Year Built | Deadweight (in metric tons) | |||
| Navios Serenity | Handysize | 2011 | 34,690 | |||
| Navios Vector (1) | Ultra Handymax | 2002 | 50,296 | |||
| Navios Mercator (1) | Ultra Handymax | 2002 | 53,553 | |||
| Navios Arc | Ultra Handymax | 2003 | 53,514 | |||
| Navios Hios | Ultra Handymax | 2003 | 55,180 | |||
| Navios Kypros | Ultra Handymax | 2003 | 55,222 | |||
| Navios Astra | Ultra Handymax | 2006 | 53,468 | |||
| Navios Primavera | Ultra Handymax | 2007 | 53,464 | |||
| Navios Ulysses | Ultra Handymax | 2007 | 55,728 | |||
| Navios Celestial | Ultra Handymax | 2009 | 58,063 | |||
| Navios Vega | Ultra Handymax | 2009 | 58,792 | |||
| Navios Star | Panamax | 2002 | 76,662 | |||
| Navios Amitie | Panamax | 2005 | 75,395 | |||
| Navios Northern Star | Panamax | 2005 | 75,395 | |||
| Navios Taurus | Panamax | 2005 | 76,596 | |||
| Navios Asteriks | Panamax | 2005 | 76,801 | |||
| N Amalthia | Panamax | 2006 | 75,318 | |||
| Navios Galileo | Panamax | 2006 | 76,596 | |||
| N Bonanza | Panamax | 2006 | 76,596 | |||
| Navios Avior | Panamax | 2012 | 81,355 | |||
| Navios Centaurus | Panamax | 2012 | 81,472 | |||
| Navios Stellar | Capesize | 2009 | 169,001 | |||
| Navios Bonavis | Capesize | 2009 | 180,022 | |||
| Navios Happiness | Capesize | 2009 | 180,022 | |||
| Navios Phoenix | Capesize | 2009 | 180,242 | |||
| Navios Lumen | Capesize | 2009 | 180,661 | |||
| Navios Antares | Capesize | 2010 | 169,059 | |||
| Navios Etoile | Capesize | 2010 | 179,234 | |||
| Navios Bonheur | Capesize | 2010 | 179,259 | |||
| Navios Altamira | Capesize | 2011 | 179,165 | |||
| Navios Azimuth | Capesize | 2011 | 179,169 | |||
| Navios Ray | Capesize | 2012 | 179,515 | |||
| Navios Gem | Capesize | 2014 | 181,336 | |||
(1) Agreed to be sold
| Long term Chartered-in Fleet in Operation | ||||||||
| Vessel Name | Vessel Type | Year Built | Deadweight (in metric tons) | Purchase Option(1) | ||||
| Navios Lyra | Handysize | 2012 | 34,718 | Yes (2) | ||||
| Navios Mercury | Ultra Handymax | 2013 | 61,393 | Yes | ||||
| Navios Venus | Ultra Handymax | 2015 | 61,339 | Yes | ||||
| Navios Marco Polo | Panamax | 2011 | 80,647 | Yes | ||||
| Navios Southern Star | Panamax | 2013 | 82,224 | Yes | ||||
| Sea Victory (TBN Navios Victory) | Panamax | 2014 | 77,095 | Yes (4) | ||||
| Elsa S | Panamax | 2015 | 80,954 | No | ||||
| Navios Amber | Panamax | 2015 | 80,994 | Yes | ||||
| Navios Sky | Panamax | 2015 | 82,056 | Yes | ||||
| Navios Coral | Panamax | 2016 | 84,904 | Yes | ||||
| Navios Citrine | Panamax | 2017 | 81,626 | Yes | ||||
| Navios Dolphin | Panamax | 2017 | 81,630 | Yes | ||||
| Mont Blanc Hawk | Panamax | 2017 | 81,638 | No | ||||
| Cassiopeia Ocean | Panamax | 2018 | 82,069 | No | ||||
| Navios Gemini | Panamax | 2018 | 81,704 | No (3) | ||||
| Navios Horizon I | Panamax | 2019 | 81,692 | No (3) | ||||
| King Ore | Capesize | 2010 | 176,800 | Yes | ||||
| Navios Koyo | Capesize | 2011 | 181,415 | Yes | ||||
| Navios Obeliks | Capesize | 2012 | 181,415 | Yes | ||||
| Dream Canary | Capesize | 2015 | 180,528 | Yes | ||||
| Dream Coral | Capesize | 2015 | 181,249 | Yes | ||||
| Navios Felix | Capesize | 2016 | 181,221 | Yes | ||||
| Bareboat-in Fleet to be delivered | ||||||||
| Vessel Name | Vessel Type | Delivery date | Deadweight (in metric tons) | Purchase Option(1) | ||||
| Navios Herakles I | Panamax | Q3 2019 | 81,000 | Yes | ||||
| Navios Felicity I | Panamax | Q4 2019 | 81,000 | Yes | ||||
| Navios Uranus | Panamax | Q4 2019 | 81,600 | Yes | ||||
| Navios Galaxy II | Panamax | Q1 2020 | 81,600 | Yes | ||||
| Navios Magellan II | Panamax | Q2 2020 | 81,000 | Yes | ||||
| (1) | Generally, Navios Holdings may exercise its purchase option after three to five years of service. |
| (2) | Navios Holdings holds the initial 50% purchase option on the vessel. |
| (3) | Navios Holdings has the right of first refusal and profit share on sale of vessel. |
| (4) | Agreed to be acquired. |