Market Overview

Navios Maritime Acquisition Corporation Reports Financial Results for the Fourth Quarter and the Year Ended December 31, 2017

Share:
  • Revenue: $50.3 million for Q4 2017; $227.3 million for 2017
  • $45.9 million net cash from operating activities for 2017
  • Adjusted EBITDA: $20.0 million for Q4 2017; $107.7 million for 2017
  • Returning capital to shareholders:
    • $25.0 million - stock repurchase program
    • Declared quarterly dividend of $0.02 per share

MONACO, Feb. 07, 2018 (GLOBE NEWSWIRE) -- Navios Maritime Acquisition Corporation ("Navios Acquisition") (NYSE:NNA), an owner and operator of tanker vessels, reported its financial results today for the fourth quarter and the year ended December 31, 2017.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition stated, "We are pleased with the results for the fourth quarter and full year of 2017. For the fourth quarter, Navios Acquisition reported revenue of $50.3 million and Adjusted EBITDA of $20.0 million. For the full year of 2017, Navios Acquisition reported revenue of $227.3 million and Adjusted EBITDA of $107.7 million. We also declared a quarterly distribution of $0.02 per share for the fourth quarter. This dividend represents an annualized distribution of $0.08 per share and a yield of approximately 10% based on the current market price of NNA."

Angeliki Frangou continued, "This dividend is accompanied by a new $25.0 million stock repurchase program. We believe this program is a particularly effective and tax efficient method for returning capital to shareholders at a time when Navios Acquisition's shares are trading below the company's net asset value as estimated by our analysts. As fellow shareholders, we are personally affected by these actions, and thus share our belief that by so reinstituting a stock repurchase program we are progressing the best long-term interests of shareholders."

HIGHLIGHTS — RECENT DEVELOPMENTS

Stock Repurchase Authorization

The Board of Directors of Navios Acquisition has authorized a stock repurchase program for up to $25.0 million of Navios Acquisition's common stock, for two years. Stock repurchases will be made from time to time for cash in open market transactions at prevailing market prices or in privately negotiated transactions. The timing and amount of repurchases under the program will be determined by management based upon market conditions and other factors. Repurchases may be made pursuant to a program adopted under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The program does not require any minimum repurchase or any specific number or amount of shares of common stock and may be suspended or reinstated at any time in Navios Acquisition's discretion and without notice. The Board of Directors will review the program periodically. Repurchases will be subject to restrictions under Navios Acquisition's credit facilities and indenture.

Dividend of $0.02 per share of common stock

On January 26, 2018, the Board of Directors of Navios Acquisition declared a quarterly cash dividend for the fourth quarter of 2017 of $0.02 per share of common stock. The dividend is payable on March 27, 2018 to shareholders of record as of March 22, 2018. 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 Acquisition's 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.

Refinancing Credit facility

Navios Acquisition is in advanced discussions for re-financing its credit facility of four product tankers, which matures in the third and fourth quarter of 2018 and the first quarter of 2019. The re- financing, under the form of a leasing structure, has a term of six years, a repayment profile of 12 years and bears interest at LIBOR plus 305 bps per annum. No assurances can be provided that Navios Acquisition will successfully refinance this credit facility.

Cash inflow of $55.1 million from early repayment of loan granted to Navios Maritime Holdings Inc. ("Navios Holdings")

On November 3, 2017, Navios Holdings prepaid in full the outstanding amount under its secured facility of up to $70.0 million, with a payment of $55.1 million. The prepayment amount consisted of the $50.0 million drawn under the facility and $5.1 million of accrued interest.

Time charter coverage

Navios Acquisition currently owns 36 vessels, of which eight are VLCCs, 26 are product tankers and two are chemical tankers.

Currently, Navios Acquisition had contracted 60.2% of its available days on a charter-out basis for 2018, which is expected to generate revenues of approximately $86.4 million for 2018. The average contractual net daily charter-out rate for the 46.3% of the available days that are contracted on base rate and /or on base rate with profit sharing is expected to be $14,184 for 2018.

FINANCIAL HIGHLIGHTS

For the following results and the selected financial data presented herein, Navios Acquisition has compiled its consolidated statements of operations for the three month periods and years ended December 31, 2017 and 2016. The quarterly information for 2017 and 2016 was derived from the unaudited condensed consolidated financial statements for the respective periods.  

 (Expressed in thousands of U.S. dollars)    

 

Three Month
Period ended
December 31, 
2017
(unaudited)
   

 

Three Month
Period ended
December 31, 
2016
(unaudited)
     

 

 

Year ended
December 31,
2017
(unaudited)
   

 

 

Year ended
December 31,
2016
(unaudited)
 
Revenue   $ 50,327   $ 67,262     $ 227,288   $ 290,245    
Net (loss)/ income   $ (11,992 ) $ 18,107     $ (78,899 $ 62,878    
Adjusted net (loss)/ income    $ (12,265 (1) $ 8,599  (2)   $ (19,372 ) (1) $ 52,097  (2)  
Net cash (used in)/provided by operating activities    

$
 

(9,706
 

)
 

$
 

2,604
     

$
 

45,942
   

$
 

92,945
   
EBITDA   $ 19,915   $ 49,892     $ 48,575   $ 194,552    
Adjusted EBITDA   $ 19,972   (1) $ 40,144  (2)   $ 107,736   (1) $ 183,317  (2)  
(Loss)/ earnings per share (basic)   $ (0.08 $ 0.11     $ (0.50 $ 0.40    
Adjusted (loss)/income per share (basic)   $ (0.08 (1) $ 0.05  (2)   $ (0.12 ) (1) $ 0.33  (2)  

  

(1)  Adjusted EBITDA, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) for the three month period ended December 31, 2017 in this document exclude $0.1 million of non-cash stock-based compensation. In addition, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) for the three month period ended December 31, 2017 further exclude a $0.3 million write off of deferred finance income.

 Adjusted EBITDA, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) for the year ended December 31, 2017 in this document exclude $59.1 million of other-than-temporary impairment loss on equity investment in Navios Maritime Midstream Partners L.P. ("Navios Midstream") and $0.1 million of non-cash stock-based compensation. In addition, Adjusted net (loss)/income and Adjusted net (loss)/income per share (basic) for the year ended December 31, 2017 further exclude a $0.4 million write-off of deferred finance costs. 

(2)  Adjusted EBITDA, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) for the three month period ended December 31, 2016 in this document exclude gain on sale of vessels of $9.5 million, gain on debt repayment of $0.4 million and non-cash stock-based compensation of $0.1 million.
In addition, Adjusted Net Income and Adjusted Earnings per share further exclude $0.2 million write off of deferred financing fees.

Adjusted EBITDA, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) for the year ended December 31, 2016 in this document exclude gain on sale of vessels of $11.7 million, non-cash stock-based compensation of $0.9 million and gain on debt repayment of $0.4 million. In addition, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) further exclude a $0.5 million write-off of deferred finance costs. 

 EBITDA, Adjusted EBITDA, Adjusted net (loss)/income and Adjusted (loss)/income per share (basic) 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). 

Three month periods ended December 31, 2017 and 2016

Revenue for the three month period ended December 31, 2017 decreased by $16.9 million, or 25.2%, to $50.3 million, as compared to $67.3 million for the same period of 2016. The decrease was mainly attributable to a: (i) decrease in the market rates during the fourth quarter ended December 31, 2017, as compared to the same period in 2016; and (ii) decrease in revenue by $0.7 million due to the sale of two chemical tankers in the fourth quarter of 2016. Available days of the fleet decreased to 3,225 days for the three month period ended December 31, 2017, as compared to 3,343 days for the three month period ended December 31, 2016. The time charter equivalent rate, or TCE Rate, decreased to $15,299 for the three month period ended December 31, 2017, from $19,683 for the three month period ended December 31, 2016.

Net loss for the three month period ended December 31, 2017 amounted to $12.0 million net loss as compared to $18.1 million net income for the same period of 2016. The decrease was due to a: (a) $20.2 million decrease in Adjusted EBITDA; (b) $9.5 million gain on sale of vessels incurred in the fourth quarter of 2016; (c) $0.5 million increase in direct vessel expenses; and (d) $0.4 million gain on debt repayment incurred in the fourth quarter of 2016; partially mitigated by a $0.4 million increase in interest income.

Adjusted EBITDA, affected by the items described in the table above, decreased by approximately $20.2 million to $20.0 million for the three month period ended December 31, 2017, as compared to $40.1 million for the same period of 2016. The decrease in Adjusted EBITDA was mainly due to a: (a) $16.9 million decrease in revenue, as described above; (b) $4.7 million increase in time charter expenses mainly due to the accrued backstop commitment to Navios Midstream; (c) $0.4 million increase in general and administrative expenses, partially mitigated by a: (i) $0.6 million decrease in other expense, net; (ii) $0.3 million decrease in management fees, mainly due to the sale of two chemical tankers in the fourth quarter of 2016, as discussed above; (iii) $0.9 million increase in equity in net earnings of affiliated companies; and (iv) $0.1 million increase in other income (excluding the $0.4 million gain on debt repayment incurred in the fourth quarter of 2016).

Years ended December 31, 2017 and 2016

Revenue for the year ended December 31, 2017 decreased by $63.0 million, or 21.7%, to $227.3 million, as compared to $290.2 million for the same period of 2016. The decrease was mainly attributable to a: (i) decrease in the market rates during the year ended December 31, 2017, as compared to the same period in 2016; and (ii) decrease in revenue by $10.8 million due to the sale of one MR2 product tanker in January 2016 and two chemical tankers in the fourth quarter of 2016. Available days of the fleet decreased to 12,904 days for the year ended December 31, 2017, as compared to 13,753 days for the year ended December 31, 2016. The TCE Rate decreased to $17,186 for the year ended December 31, 2017, from $20,742 for the year ended December 31, 2016.

Net loss for the year ended December 31, 2017 amounted to $78.9 million as compared to $62.9 million net income for the same period of 2016. Net loss was affected by the items described in the table above. Adjusted net loss for the year ended December 31, 2017 decreased by $71.5 million to $19.4 million net loss as compared to $52.1 million net income for the same period of 2016. The decrease was due to a: (a) $75.6 million decrease in Adjusted EBITDA; (b) $1.4 million increase in amortization of dry dock and special survey costs included in direct vessel expenses; and (c) $0.5 million increase in interest expense and finance cost; partially mitigated by a: (i) $5.3 million increase in interest income; and (ii) $0.7 million decrease in depreciation and amortization, due to the sale of one MR product tanker and two chemical tankers in 2016.

Adjusted EBITDA, affected by the items described in the table above, decreased by approximately $75.6 million to $107.7 million for the year ended December 31, 2017, as compared to $183.3 million for the same period of 2016. The decrease in Adjusted EBITDA was mainly due to a: (a) $63.0 million decrease in revenue, as described above; (b) $16.9 million increase in time charter expenses mainly due to the $16.4 million accrued backstop commitment to Navios Midstream; and (c) $3.1 million decrease in equity/ (loss) in net earnings of affiliated companies, (excluding the $59.1 million of non-cash impairment loss on equity investment in Navios Midstream), partially mitigated by a: (i) $2.3 million decrease in general and administrative expenses (excluding stock-based compensation); (ii) $2.9 million decrease in management fees, mainly due to the sale of one MR2 product tanker in January 2016 and two chemical tankers in the fourth quarter of 2016; (iii) $1.4 million decrease in other expense; and (iv) $0.7 million decrease in direct vessel expenses (excluding amortization of dry dock and special survey costs).

Fleet Employment Profile   

The following table reflects certain key indicators of the performance of Navios Acquisition and its core fleet for the three month periods ended and the years ended December 31, 2017 and 2016.

                                 
    Three month period ended
December 31,
    Year ended
December 31,
 
    2017
(unaudited)
    2016
(unaudited)
    2017
(unaudited)
    2016
(unaudited)
 
FLEET DATA                                
Available days(1)     3,225       3,343       12,904       13,753  
Operating days(2)     3,183       3,328       12,843       13,716  
Fleet utilization(3)     98.7     99.5     99.5     99.7
Vessels operating at period end       36       36       36       36  
AVERAGE DAILY RESULTS          
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