Navios Holdings posts ‘excellent results’ for the fourth quarter and full year of 2021

Navios Holdings, a global seaborne shipping and logistics company, reported financial results for the fourth quarter and year ended December 31, 2021.

Highlights

• Net Income
  • $31.8 million in Q4 2021
  • $116.7 million in FY 2021
• Revenue
  • 53.2% increase to $156.8 million in Q4 2021
  • 40.6% increase to $585.8 million in FY 2021
• Cash from operating activities
  • $78.0 million in Q4 2021 compared to ($10.1) million in Q4 2020
  • $109.6 million in FY 2021 compared to $25.2 million in FY 2020
• Adjusted EBITDA, a non-GAAP measure
  • 171.3% increase to $101.9 million in Q4 2021
  • 130.3% increase to $353.2 million in FY 2021
• Time Charter Equivalent
  • $31,156 per day in Q4 2021 compared to $13,248 per day in Q4 2020
  • $23,638 per day in FY 2021 compared to $10,543 per day in FY 2020
• $614.3 million Repayment of Ship Mortgage Notes
• $150.0 million Principal Reduction of Senior Notes

Angeliki Frangou, Chairwoman and Chief Executive Officer, stated, “I am pleased with our excellent results for the fourth quarter and full year of 2021.  In the fourth quarter of 2021, Navios Holdings reported revenue of $156.8 million, Adjusted EBITDA of $101.9 million and Adjusted Net Income of $45.8 million. For the full year, Navios Holdings recorded revenue of $585.8 million, Adjusted EBITDA of $353.2 million, and Adjusted Net Income of $130.7 million.”

Angeliki Frangou, continued, “Through the course of 2021, we worked creatively to assemble a debt package that allowed us to extinguish $614.3 million of Ship Mortgage Notes, and to also reduce the principal amount outstanding of the Senior Notes to $155 million. Today, we have a much improved balance sheet, and runway to further deleverage in a favorable dry bulk market.”

HIGHLIGHTS – RECENT DEVELOPMENTS

$614.3 million Repayment of Ship Mortgage Notes

In January 2022, the Company repaid its 7.375% First Priority Ship Mortgage Notes (“Ship Mortgage Notes”) using (i) $206.7 million under two credit facilities with commercial banks; (ii) $77.0 million under sale and leaseback agreements; (iii) $100.0 million of additional financing from N Shipmanagement Acquisition Corp. and its subsidiaries (“NSM”), an entity affiliated with Navios Holdings’ Chairwoman and Chief Executive Officer; and (iv) cash from balance sheet. In addition, $158.9 million of Ship Mortgage Notes held by the Company that had previously been pledged as collateral to NSM were cancelled.

As a result of these transactions, $614.3 million in debt maturing in 2022 was retired and the maturity of the remaining debt was extended and staggered.

$150.0 million Principal Reduction of Senior Notes

During the second half of 2021, Navios Holdings redeemed $150.0 million of its 11.25% Senior Secured Notes (“Senior Notes”).  Following this redemption, $155.0 million of Senior Notes remains outstanding and matures in August 2022.

Fleet Statistics

Navios Holdings controls a fleet of 36 vessels totaling 3.9 million dwt, of which 25 are owned (including five bareboat-in vessels) and 11 are chartered-in under long-term charters (collectively, the “Core Fleet”). The fleet consists of 12 Capesize, 19 Panamax, four Ultra-Handymax and one Handysize vessels, with an average age of 9.1 years.

As of February 18, 2022, Navios Holdings has chartered-out 77% of available days for 2022. 33% of available days are chartered-out on fixed rate and 44% are chartered-out on index.

The average contracted daily charter-in rate for the long-term charter-in vessels for 2022 is $15,633 per day.

The above figures do not include the fleet of Navios Logistics.

Exhibit II provides certain details of the Core Fleet of Navios Holdings. It does not include the fleet of Navios Logistics.

Non-GAAP Measures

EBITDA, Adjusted EBITDA, Adjusted Net Income/(Loss) attributable to Navios Holdings’ common stockholders and Adjusted Basic Earnings/(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 Earnings/(Loss) attributable to Navios Holdings’ common stockholders per share of Navios Holdings (including Navios Logistics), and EBITDA of Navios Logistics (on a stand-alone basis) and a reconciliation of such measures to the most comparable measures calculated under U.S. GAAP.

Earnings Highlights

Fourth Quarter 2021 and 2020 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The fourth quarter 2021 and 2020 information presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.

Revenue from the Dry Bulk Vessel Operations for the three month period ended December 2021 increased by $46.8 million, or 76.9%, to $107.6 million, as compared to $60.8 million for the same period during 2020. The increase in dry bulk revenue was mainly attributable to the increase in the time charter and freight market during three month period ended December 31, 2021. The TCE per day increased by 135% to $31,156 per day in the three month period ended December 31, 2021, as compared to $13,248 per day in the same period of 2020.

Revenue from the Logistics Business was $49.2 million for the three month period ended December 31, 2021, as compared to $41.5 million for the same period in 2020. The increase was mainly attributable to (i) a $6.3 million increase in revenue from the barge business, mainly due to a $7.0 million increase in CoA/voyage revenues related to higher liquid and dry cargo moved, partially mitigated by a $0.7 million decrease in time charter revenues mainly due to lower time charter rates; (ii) a $3.5 million increase in sales of products due to the increase in the Paraguayan liquid port’s volumes of products sold; and (iii) a $0.1 million increase in revenue from the port terminal business ,mainly due to higher storage revenues in the iron ore port terminal. The overall increase was partially mitigated by a $2.2 million decrease in revenue from the cabotage business, mainly due to fewer operating days.

Net Income attributable to Navios Holdings’ common stockholders was $31.8 million for the three month period ended December 31, 2021, as compared to a $94.4 million Net Loss attributable to Navios Holdings’ common stockholders for the same period in 2020. Net Income/(Loss) attributable to Navios Holdings’ common stockholders in the three month period ended December 31, 2021 and 2020 were affected by items described in the table above. Excluding these items, Adjusted Net Income attributable to Navios Holdings’ common stockholders for the three month period ended December 31, 2021 was $45.8 million as compared to a $20.5 million Adjusted Net Loss attributable to Navios Holdings’ common stockholders for the three month period ended December 31, 2020. This increase in Adjusted Net Income was mainly due to (i) a $64.3 million increase in Adjusted EBITDA as discussed in the paragraph below; (ii) a $2.7 million decrease in depreciation and amortization; (iii) a $0.3 million decrease in income tax expense; and (iv) a $0.2 million decrease in stock-based compensation expense. This overall increase of approximately $67.6 million was partially mitigated by (i) a $0.9 million increase in interest expense and finance cost, net; and (ii) a $0.3 million increase in amortization of deferred drydock and special survey costs.

Net Loss of Navios Logistics, on a standalone basis, was $42.0 million for the three month period ended December 31, 2021 as compared to $9.7 million for the same period in 2020. Excluding $22.0 million of impairment loss incurred for the three month period ended December 31, 2021, Adjusted Net Loss of Navios Logistics, on a standalone basis, was $20.1 million for the three month period ended December 31, 2021.

Adjusted EBITDA of Navios Holdings for the three month period ended December 31, 2021 increased by $64.3 million to $101.9 million, as compared to $37.6 million for the same period in 2020. The increase in Adjusted EBITDA was primarily due to (i) a $54.4 million increase in revenue; (ii) a $10.0 million increase in equity in net earnings from affiliate companies; (iii) a $3.8 million increase in net loss attributable to noncontrolling interest; (iv) a $1.0 million decrease in general and administrative expenses (excluding stock-based compensation expenses); and (v) a $0.1 million decrease in time charter, voyage and logistics business expenses. This overall increase of $69.3 million was partially mitigated by (i) a $2.5 million increase in other expense, net; (ii) a $2.4 million increase in direct vessel expenses (excluding the amortization of deferred drydock and special survey costs); and (iii) a $0.1 million loss incurred on bond extinguishment.

Adjusted EBITDA of Navios Logistics, on a standalone basis, was $10.2 million for the three month period ended December 31, 2021 (adjusted to exclude $22.0 million in impairment losses incurred) as compared to $13.1 million for the same period in 2020.

Year Ended December 2021 and 2020 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The information for the year ended December 31, 2021 and 2020 presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.

Revenue from the Dry Bulk Vessel Operations for the year ended December 31, 2021 increased by $161.5 million, or 80.5%, to $362.3 million, as compared to $200.8 million for the same period during 2020. The increase in dry bulk revenue was mainly attributable to the increase in the time charter and freight market during 2021. The TCE per day increased by 124% to $23,638 per day in the year ended December 31, 2021, as compared to $10,543 per day in the same period of 2020.

Revenue from the Logistics Business was $223.5 million for the year ended December 31, 2021, as compared to $215.9 million for the same period in 2020. The increase was mainly attributable to (i) a $16.2 million increase in revenue from the barge business mainly due to a $23.8 million increase in CoA/voyage revenues related to higher CoA/voyage revenues of convoys previously under time charter contracts, partially mitigated by a $7.6 million decrease in time charter revenues mainly due to the expiration of certain legacy time charter contracts; and (ii) a $5.4 million increase in revenue from the port terminal business mainly due to higher volumes transshipped in the grain port terminal and higher storage revenues in the iron ore port terminal and liquid port terminal. The overall increase was partially mitigated by (i) a $10.6 million decrease in revenue from the cabotage business mainly due to fewer operating days; and (ii) a $3.5 million decrease in sales of products due to the decrease in the Paraguayan liquid port’s volume of products sold.

Net Income attributable to Navios Holdings’ common stockholders was $116.7 million for the year ended December 31, 2021, as compared to a $193.0 million Net Loss attributable to Navios Holdings’ common stockholders for the same period in 2020. Net Income/(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 year ended December 31, 2021 was approximately $130.7 million, as compared to $67.5 million in Adjusted Net Loss attributable to Navios Holdings’ common stockholders for the same period in 2020. This increase in Adjusted Net Income was mainly due to (i) a $199.8 million increase in Adjusted EBITDA as discussed in the paragraph below; (ii) a $9.8 million decrease in depreciation and amortization; and (iii) a $0.7 million decrease in stock-based compensation expense. This overall increase of $210.3 million was partially mitigated by (i) a $8.5 million increase in interest expense and finance cost, net, mainly due to the higher weighted average interest rate of Navios Logistics due to the issuance of Navios Logistics’ 10.75% Notes due 2025; (ii) a $2.8 million increase in income tax expense mainly due to the recalculation of the deferred tax liability resulting from an increase in income tax rate; and (iii) a $0.8 million increase in amortization of deferred drydock and special survey costs.

Net Loss of Navios Logistics, on a standalone basis, was $44.3 million for the year ended December 31, 2021 as compared to $12.0 million of Net Income of Navios Logistics for the same period in 2020. Excluding $22.0 million in impairment loss incurred during the year ended December 31, 2021, Adjusted Net Loss of Navios Logistics, on a standalone basis, was $22.4 million for the year ended December 31, 2021. Excluding $4.2 million in write-off of deferred finance cost for bond extinguishment incurred for the year ended December 31, 2020, Adjusted Net Income of Navios Logistics, on a standalone basis, was $16.2 million for the year ended December 31, 2020.

Adjusted EBITDA of Navios Holdings for the year ended December 31, 2021 increased by $199.8 million to $353.2 million, as compared to $153.4 million for the same period in 2020. The increase in Adjusted EBITDA was primarily due to (i) a $169.1 million increase in revenue; (ii) a $21.2 million increase in net loss attributable to noncontrolling interest; (iii) a $17.9 million increase in equity in net earnings from affiliate companies; (iv) a $12.1 million decrease in time charter, voyage and logistics business expenses; and (v) a $1.7 million decrease in general and administrative expenses (excluding stock-based compensation expenses). This overall increase of $222.0 million was partially mitigated by (i) a $10.3 million decrease in gain on bond and debt extinguishment; (ii) a $6.8 million increase in direct vessel expenses (excluding the amortization of deferred drydock and special survey costs); and (iii) a $5.1 million increase in other expense, net.

Excluding $22.0 million in impairment loss incurred during the year ended December 31, 2021, Adjusted EBITDA of Navios Logistics, on a standalone basis, was $78.0 million for the year ended December 31, 2021. Excluding $4.2 million in write-off of deferred financing cost for bond and debt extinguishment incurred for the year ended December 31, 2020, Adjusted EBITDA of Navios Logistics, on a standalone basis, was $90.6 million for the year ended December 31, 2020.

Fleet Summary Data:

The following table reflects certain key indicators indicative of the performance of Navios Holdings’ dry bulk operations (excluding the Navios Logistics’ fleet) and its fleet performance for the three month period and year ended December 31, 2021 and 2020, respectively.