Navios Maritime Acquisition Sees Rise in Profit in Q1

Navios Maritime Acquisition

Navios Maritime Acquisition Corporation reported Financial Results for the First Quarter Ended March 31, 2016.

Net income
$23.8 million for Q1 2016; $0.15 per share
6% increase for Q1 2016 YoY
Adjusted EBITDA
$55.8 million for Q1 2016
5% increase in Q1 2016 YoY
Commercial and technical management fees fixed until May 2018
$6,350 per day per MR2 and chemical tanker
$7,150 per day per LR1
$9,500 per day per VLCC
Profit sharing
$6.1 million for Q1 2016
Sale of Nave Constellation and Nave Universe, chemical tankers, expected in Q3 2016
$11.7 million expected book gain
Quarterly dividend of $0.05 per share; 11.8% current annualized yield

Navios Maritime Acquisition Corporation (“Navios Acquisition”) (NYSE:NNA), an owner and operator of tanker vessels, reported its financial results today for the first quarter ended March 31, 2016.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition stated, “We are pleased to report first quarter 2016 net income of almost $24.0 million, or $0.15 per share, an increase of 19% over the first quarter of 2015. Tanker fundamentals remain constructive, and we declared a dividend of $0.05 per share for the quarter, resulting in a dividend yield of about 12% on an annualized basis.”

Angeliki Frangou continued, “Navios Acquisition continues to harness the economies of scale created by Navios Holdings. Under the arrangement, Navios Holdings provides Navios Acquisition technical and commercial management services for a fixed fee and administrative services at cost. Navios Holdings does not charge, unlike some peers, any transaction fee, loan origination fee, sale or purchase fee or any other fee for creating value. We believe that the significant cost savings, which we estimate would have been more than $30.0 million in each of 2015 and 2014 as compared to publicly listed peers, further demonstrate the substantial benefit of the overarching relationship between Navios Holdings and Navios Acquisition and the value it delivers to all our stakeholders.“

HIGHLIGHTS — RECENT DEVELOPMENTS

Dividend of $0.05 per share of common stock

On May 11, 2016, the Board of Directors of Navios Acquisition declared a quarterly cash dividend for the first quarter of 2016 of $0.05 per share of common stock. The dividend is payable on June 22, 2016 to stockholders of record as of June 17, 2016 and provides a current annualized yield of 11.8%.

Commercial and technical management fees fixed until May 2018

Navios Acquisition fixed the fees of its vessels under its existing management agreement with Navios Tankers Management Inc., a wholly-owned subsidiary of Navios Maritime Holdings Inc. (“Navios Holdings”), for an additional two-year period from May 29, 2016, following the expiration of the current fixed fee period, until May 28, 2018, at a daily fee of: (a) $6,350 per MR2 product tanker and chemical tanker vessel; (b) $7,150 per LR1 product tanker vessel; and (c) $9,500 per VLCC. The increase represents a weighted average increase of 3% in the management fees of the fleet. Drydocking expenses are reimbursed at cost for all vessels.

Profit sharing

During the first quarter of 2016, Navios Acquisition benefited from the healthy spot market and earned $6.1 million under its profit sharing arrangements.

Sale of Vessels

On January 27, 2016, Navios Acquisition sold the Nave Lucida, a 2005-built, MR2 product tanker to an unaffiliated third party for a sale price of $18.6 million.

In April 2016, Navios Acquisition agreed to sell to an unaffiliated third party the Nave Constellation, a 2013-built chemical tanker of 45,281 dwt, and the Nave Universe, a 2013-built chemical tanker of 45,513 dwt, for an aggregate sale price of $74.6 million. The vessels are expected to be sold in the third quarter of 2016, following the completion of their chartering commitments.

Time Charter Coverage

Navios Acquisition currently owns 38 vessels of which eight are VLCCs, 26 are product tankers and four are chemical tankers including the two vessels that Navios Acquisition has agreed to sell following the completion of their chartering commitments, expected in the third quarter of 2016.

As of May 19, 2016, Navios Acquisition had contracted 95.2% and 53.0% of its available days on a charter-out basis for 2016 and 2017, respectively, expecting to generate revenues of approximately $232.3 million and $110.6 million, respectively. The average contractual daily charter-out rate for the fleet is expected to be $20,107 and $21,419 for 2016 and 2017, respectively.

FINANCIAL HIGHLIGHTS

For the following results and the selected financial data presented herein, Navios Acquisition has compiled its consolidated statement of operations for the three months ended March 31, 2016 and 2015. The quarterly information for 2016 and 2015 was derived from the unaudited condensed consolidated financial statements for the respective periods.

  Three Month
 Period ended
March 31,
2016
    Three Month
 Period ended
March 31,
2015
 
(Expressed in thousands of U.S. dollars)   (unaudited)     (unaudited)  
Revenue $ 80,419 $ 78,611
EBITDA $ 57,768 $ 53,208
Adjusted EBITDA(1) $ 55,750 $ 53,864
Net income $ 23,770 $ 20,034
Earnings per share (basic) $ 0.15 $ 0.13
(1 ) Adjusted EBITDA for the three month period ended March 31, 2016 in this document excludes gain on sale of vessel of $2.3 million and non-cash stock-based compensation of $0.3 million.

Adjusted EBITDA for the three months ended March 31, 2015, in this document exclude a $0.7 million non-cash share based compensation expense.

EBITDA and Adjusted EBITDA are non-GAAP financial measures and should not be used in isolation or substitution for Navios Acquisition’s results (see Exhibit II for reconciliation of EBITDA and Adjusted EBITDA).

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