Navios Maritime Midstream Partners L.P.
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Navios Maritime Midstream Partners L.P. Reports Financial Results for the Third Quarter and Nine Months Ended September 30, 2015

MONACO -- (Marketwired) -- 10/27/15 -- Navios Maritime Midstream Partners L.P. (NYSE: NAP)

  • Cash distribution growth - 10% target
    • 2.4% increase in quarterly cash distribution to $0.4225 per unit;
    • $1.69 per unit annualized
  • Net Income: $6.2 million in Q3; $17.9 million for the nine months
  • Earnings per Common Unit: $0.30 in Q3; $0.89 for the nine months
  • EBITDA: $16.2 million in Q3; $42.8 million for the nine months
  • Operating Surplus: $9.7 million in Q3; $29.5 million for the nine months
  • Profit sharing: $2.1 million in Q3; $4.6 million for the nine months

Navios Maritime Midstream Partners L.P. ("Navios Midstream") (NYSE: NAP), an owner and operator of tanker vessels, reported its financial results today for the third quarter and the nine month period ended September 30, 2015.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Midstream stated, "We are excited to report our results for the third quarter of 2015. We had $16.2 million of EBITDA and $6.2 million of net income, or $0.30 per common unit. We also announced a 2.4% increase in distributions to $0.42 and a quarter cents per unit. Navios Midstream's annualized distribution will be $1.69 per unit -- offering a current yield of 11.5%."

Angeliki Frangou continued, "The VLCC market remains healthy and the relative low price of oil bodes well for oil consumption and transportation. So far, this correlation has held -- the 2015 year to date spot rate for a VLCC improved more than 100% to an average of about $56,000 compared to the average rate of $27,000 in 2014. In addition, the charter market has improved by 86%, with 56 long-term time charters fixed through mid-October compared to 30 for all of 2014."

RECENT DEVELOPMENTS

Quarterly Cash Distribution
The Board of Directors of Navios Midstream declared a cash distribution for the third quarter of 2015 of $0.4225 per unit. This represents an increase of 2.4% from the cash distribution of $0.4125 per unit declared in the previous quarter. The cash distribution is payable on November 13, 2015 to unitholders of record as of November 11, 2015.

Profit Share
During the third quarter of 2015, Navios Midstream benefited from the VLCC spot market and recognized $2.1 million under its profit sharing arrangements. Profit share recognized for the nine months ended September 30, 2015, was $4.6 million.

Long-Term Cash Flow
Navios Midstream has entered into long-term charter-out agreements for its vessels, with a remaining average term of 5.6 years, which are expected to provide a stable base of revenue and distributable cash flow. Navios Midstream has currently contracted out 100% of its available days for 2015 and 2016, expecting to generate revenues of approximately $81.9 million and $89.6 million, respectively. The average expected daily charter-out rate for the fleet is $44,151 and $40,798 for 2015 and 2016, respectively.

EARNINGS HIGHLIGHTS

For the following results and the selected financial data presented herein, Navios Midstream has compiled condensed consolidated and combined statements of operations for the three and nine months periods ended September 30, 2015 and 2014. The quarterly and nine month information for period 2015 and 2014 was derived from the unaudited condensed consolidated and combined financial statements for the respective periods. EBITDA and Operating Surplus are non-GAAP financial measures and should not be used in isolation or substitution for Navios Midstream's results.

(in $'000 except per unit data) Three Month
Period ended
September 30, 2015
(unaudited)
Three Month
Period ended
September 30, 2014
(unaudited)
(1)
Nine Month
Period ended
September 30, 2015
(unaudited)
Nine Month
Period ended
September 30, 2014
(unaudited)
(1)
Revenue $ 22,473 $ 16,174 $ 57,526 $ 47,526
Net income/(loss) 6,232 (27 ) 17,938 (1,443 )
Adjusted net income/(loss)(2) 6,232 (27 ) 19,623 (1,443 )
EBITDA 16,209 12,259 42,809 35,526
Earnings per common unit (basic and diluted) 0.30 -- 0.89 --
Adjusted earnings per common unit (basic and diluted)(2) 0.30 -- 0.97 --
Operating Surplus 9,737 -- 29,460 --
Maintenance and replacement capital expenditure reserve (3,591 ) -- (8,093 ) --
(1) Prior to the Navios Midstream's IPO in November 2014, Navios Midstream's four VLCC fleet was part of Navios Maritime Acquisition Corporation's fleet. All figures prior to the IPO are not directly comparable to periods after the IPO.
(2) Net income and Earnings per common unit (basic and diluted) for the nine month period ended September 30, 2015 have been adjusted to exclude the amount of $1,685 representing a write-off of deferred finance cost associated with debt prepayment.

Three month periods ended September 30, 2015 and 2014

Revenue for the three month period ended September 30, 2015 increased by $6.3 million to $22.5 million, as compared to $16.2 million for the same period in 2014. Time Charter Equivalent ("TCE") was $45,432 for the three month period ended September 30, 2015 and $43,478 for the three month period ended September 30, 2014. The increase was due to profit sharing of $2.1 million recognized in the three month period ended September 30, 2015, in relation to certain charters and the acquisition of the Nave Celeste and the C. Dream in June 2015.

EBITDA increased by $4.0 million to $16.2 million for the three month period ended September 30, 2015, as compared to $12.3 million for the same period in 2014. The increase in EBITDA was due to a $6.3 million increase in revenue. The above increase was partially mitigated by a: (a) $1.7 million increase in management fees; (b) $0.5 million increase in general and administrative expenses; and (c) $0.1 million increase in time charter expenses.

The reserve for estimated maintenance and replacement capital expenditures for the three month period ended September 30, 2015 was $3.6 million (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Navios Midstream generated an Operating Surplus for the three month period ended September 30, 2015 of $9.7 million. Operating Surplus is a non-GAAP financial measure used by certain investors to assist in evaluating a partnership's ability to make quarterly cash distributions (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Net income for the three month period ended September 30, 2015 was $6.2 million compared to a less than $0.1 million loss for the three month period ended September 30, 2014. The increase in net income was due to a: (i) $4.0 million increase in EBITDA; and (ii) $3.8 million decrease in interest expense and finance cost; partially mitigated by a :(a) $1.5 million increase in depreciation and amortization; and (b) $0.1 million increase in direct vessel expenses.

Earnings per common unit for the three month period ended September 30, 2015 was $0.30.

Nine month periods ended September 30, 2015 and 2014

Revenue for the nine month period ended September 30, 2015 increased by $10.0 million to $57.5 million, as compared to $47.5 million for the same period in 2014. Time Charter Equivalent ("TCE") was $45,917 for the nine month period ended September 30, 2015 and $42,987 for the nine month period ended September 30, 2014. The increase was due to profit sharing of $4.6 million recognized in the nine month period ended September 30, 2015, in relation to certain charters and the acquisition of the Nave Celeste and the C. Dream in June 2015.

EBITDA increased by $7.3 million to $42.8 million for the nine month period ended September 30, 2015, as compared to $35.5 million for the same period in 2014. The increase in EBITDA was due to: (i) $10.0 million increase in revenue. The above increase was partially mitigated by a: (a) $1.7 million increase in management fees; and (b) $1.0 million increase in general and administrative expenses.

The reserve for estimated maintenance and replacement capital expenditures for the nine month period ended September 30, 2015 was $8.1 million (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Navios Midstream generated an Operating Surplus for the nine month period ended September 30, 2015 of $29.5 million. Operating Surplus is a non-GAAP financial measure used by certain investors to assist in evaluating a partnership's ability to make quarterly cash distributions (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Net income for the nine month period ended September 30, 2015 was negatively affected by a $1.7 million write-off of deferred finance cost in association with debt prepayment. Excluding that write-off, Adjusted net income for the nine month period ended September 30, 2015 was $19.6 million compared to a $1.4 million loss for the nine month period ended September 30, 2014. The increase in Adjusted net income was mainly due to a: (i) $7.3 million increase in EBITDA; and (ii) $15.4 million decrease in interest expense and finance cost; partially mitigated by a $1.7 million increase in depreciation and amortization.

Earnings per common unit for the nine month period ended September 30, 2015 was $0.89.

Fleet Employment Profile

The following table reflects certain key indicators of Navios Midstream's core fleet performance for the three and nine month periods ended September 30, 2015 and 2014.

Three Month
Period ended
September 30, 2015
(unaudited)
Three Month
Period ended
September 30, 2014
(unaudited)
Nine Month
Period ended
September 30, 2015
(unaudited)
Nine Month
Period ended
September 30, 2014
(unaudited)
FLEET DATA
Available days(1) 489 368 1,239 1,092
Operating days(2) 488 368 1,238 1,090
Fleet utilization(3) 99.8 % 100.0 % 99.9 % 99.8 %
Vessels operating at period end 6 4 6 4
AVERAGE DAILY RESULTS
Time Charter Equivalent per day(4) $ 45,432 $ 43,478 $ 45,917 $ 42,987
(1) Available days for the fleet represent total calendar days the vessels were in Navios Midstream's possession for the relevant period after subtracting off-hire days associated with scheduled repairs, dry dockings or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which a vessel is capable of generating revenues.
(2) Operating days is 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 Midstream's vessels were available for revenue generating available days, 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 efficiency in finding employment for vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs, drydockings or special surveys.
(4) Time Charter Equivalent ("TCE") rates: TCE rates are defined as voyage and time charter revenues less voyage expenses during a period divided by the number of available days during the period. The TCE rate is a standard shipping industry performance measure used primarily to present the actual daily earnings generated by vessels on various types of charter contracts for the number of available days of the fleet.

Conference Call details:

Navios Midstream's management will host a conference call today, Tuesday, October 27, 2015 to discuss the results for the third quarter and nine months ended September 30, 2015.

Conference Call details:

Call Date/Time: Tuesday, October 27, 2015 at 08:30 am ET
Call Title: Navios Midstream Q3 2015 Financial Results Conference Call
US Dial In: +1.866.703.4207
International Dial In: +1.636.692.6440
Conference ID: 5664 6488

The conference call replay will be available two hours 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: 5664 6488

Slides and audio webcast:
There will also be a live webcast of the conference call, through the Navios Midstream's website (www.navios-midstream.com) under "Investors". Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.
A supplemental slide presentation will be available on the Navios Midstream's website under the "Investors" section by 8:00 am ET on the day of the call.

About Navios Maritime Midstream Partners L.P.

Navios Maritime Midstream Partners L.P. is a publicly traded master limited partnership which owns and operates crude oil tankers under long-term employment contracts. For more information, please visit our website at www.navios-midstream.com.

Forward-Looking Statements

This press release contains 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 and Navios Midstream's 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. Although the Navios Midstream 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 Midstream. 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, the creditworthiness of our charterers and the ability of our contract counterparties to fulfill their obligations to us, tanker industry trends, including charter rates and vessel values and factors affecting vessel supply and demand, the aging of our vessels and resultant increases in operation and drydocking costs, the loss of any customer or charter or vessel, our ability to repay outstanding indebtedness, to obtain additional financing and to obtain replacement charters for our vessels, in each case, at commercially acceptable rates or at all, 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, potential liability from litigation and our vessel operations, including discharge of pollutants, general domestic and international political conditions, competitive factors in the market in which Navios Midstream operates; risks associated with operations outside the United States; and other factors listed from time to time in the Navios Midstream's filings with the Securities and Exchange Commission. Navios Midstream 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 Midstream's expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.

EXHIBIT 1

NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of U.S. Dollars)
September 30,
2015
(unaudited)
December 31,
2014
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 31,345 $ 30,877
Accounts receivable, net 5,370 653
Due from related parties 2,306 --
Prepaid expenses and other current assets 44 212
Total current assets 39,065 31,742
Vessels, net 405,737 320,229
Intangible assets 29,272 31,736
Deferred dry dock and special survey costs, net 6,644 1,955
Total non-current assets 441,653 353,920
Total assets $ 480,718 $ 385,662
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities
Accounts payable $ 1,206 $ 1,243
Accrued expenses 596 4,174
Due to related parties 87 736
Deferred revenue 1,931 1,938
Current portion of long-term debt, net of deferred finance costs and discount 640 10,022
Total current liabilities 4,460 18,113
Long Term Debt, net of current portion, net of deferred finance costs and discount 197,336 114,065
Total non-current liabilities 197,336 114,065
Total liabilities $ 201,796 $ 132,178
Commitments and contingencies -- --
Total partners' capital -- --
Common Unitholders (9,342,692 units issued and outstanding at September 30, 2015 and December 31, 2014) 126,141 127,350
Subordinated Series A Unitholders (1,592,920 units issued and outstanding at September 30, 2015 and none at December 31, 2014) 27,349 --
Subordinated Unitholders (9,342,692 units issued and outstanding at September 30, 2015 and December 31, 2014) 119,978 121,187
General Partner (413,843 units issued and outstanding at September 30, 2015 and 381,334 issued and outstanding at December 31, 2014) 5,454 4,947
Total partners' capital 278,922 253,484
Total liabilities and partners' capital $ 480,718 $ 385,662
NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of U.S. Dollars, except per unit amounts)
Three Month
Period ended
September 30, 2015
(unaudited)
Three Month
Period ended
September 30, 2014
(unaudited)
Nine Month
Period ended
September 30, 2015
(unaudited)
Nine Month
Period ended
September 30, 2014
(unaudited)
Revenue $ 22,473 $ 16,174 $ 57,526 $ 47,526
Time charter expenses (247 ) (170 ) (624 ) (579 )
Direct vessel expenses (373 ) (289 ) (951 ) (994 )
Management fees (entirely through related party transactions) (5,244 ) (3,496 ) (12,369 ) (10,670 )
General and administrative expenses (773 ) (254 ) (1,790 ) (756 )
Depreciation and amortization (6,366 ) (4,877 ) (16,319 ) (14,632 )
Interest expenses and finance cost (3,238 ) (7,120 ) (7,601 ) (21,343 )
Other income, net -- 5 66 5
Net income/ (loss) $ 6,232 $ (27 ) $ 17,938 $ (1,443 )
Net income $ 6,232 $ 17,938
Earnings per unit (basic and diluted)
Common unitholders: $ 0.30 $ 0.89
Subordinated Series A unitholders: $ 0.30 $ 1.46
Subordinated unitholders: $ 0.30 $ 0.89
NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in thousands of U.S. Dollars)
Nine Month
Period Ended
September 30,
2015
(unaudited)
Nine Month
Period Ended
September 30,
2014
(unaudited)
OPERATING ACTIVITIES
Net income/ (loss) $ 17,938 $ (1,443 )
Adjustments to reconcile net income/ (loss) to net cash provided by operating activities:
Depreciation and amortization 16,319 14,632
Amortization of deferred finance fees and bond premium 2,321 554
Amortization of dry dock and special survey costs 951 994
Changes in operating assets and liabilities:
Decrease in prepaid expenses and other current assets 168 128
Payment for Drydocking (5,638 ) --
Increase in accounts receivable (4,717 ) (66 )
Increase / (decrease) in accounts payable 484 (112 )
(Decrease) in accrued expenses (1,098 ) (25 )
(Decrease)/ increase in due to/ from related parties (2,611 ) 367
Decrease in deferred revenue (7 ) --
Net cash provided by operating activities $ 24,110 $ 15,029
INVESTING ACTIVITIES
Acquisition of vessels (72,252 ) --
Increase in due from related parties -- (38,906 )
Net cash used in investing activities $ (72,252 ) $ (38,906 )
FINANCING ACTIVITIES
Proceeds from Long term debt, net of deferred finance costs and discount 198,081 --
Loan repayment (126,513 ) --
IPO expenses (3,347 ) --
Dividend paid (20,162 ) --
Proceeds from issuance of general partner units 551 --
Owner's net investment -- 20,782
Net cash provided by financing activities $ 48,610 $ 20,782
Net increase/ (decrease) in cash and cash equivalents 468 (3,095 )
Cash and cash equivalents, beginning of year $ 30,877 $ 9,152
Cash and cash equivalents, end of year $ 31,345 $ 6,057
Supplemental disclosures of cash flow information
Cash interest paid $ 5,256 $ 14,008

EXHIBIT 2

Owned Vessels Type Built Capacity (DWT)
Shinyo Kieran VLCC 2011 297,066
Shinyo Saowalak VLCC 2010 298,000
Shinyo Kannika VLCC 2001 287,175
Shinyo Ocean VLCC 2001 281,395
C. Dream VLCC 2000 298,570
Nave Celeste VLCC 2003 298,717
Option Vessels(1) Type Built Capacity (DWT)
Nave Buena Suerte VLCC 2011 297,491
Nave Quasar VLCC 2010 297,376
Nave Galactic VLCC 2009 297,168
Nave Neutrino VLCC 2003 298,287
Nave Electron VLCC 2002 305,178
(1) Navios Midstream has options, exercisable through November 18, 2016, to acquire up to five VLCCs at fair market value from Navios Maritime Acquisition Corporation.

EXHIBIT 3

Disclosure of Non-GAAP Financial Measures

1. EBITDA

EBITDA represents net income plus interest and finance costs plus depreciation and amortization and income taxes.

EBITDA is presented because Navios Midstream believes that EBITDA is a basis upon which liquidity can be assessed and present useful information to investors regarding Navios Midstream's ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. EBITDA is a "non-GAAP financial measure" and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

While EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.

2. Operating Surplus

Operating Surplus represents net income adjusted for depreciation and amortization expense, non-cash interest expense and estimated maintenance and replacement capital expenditures. Maintenance and replacement capital expenditures are those capital expenditures required to maintain over the long term the operating capacity of, or the revenue generated by, Navios Midstream's capital assets.

Operating Surplus is a quantitative measure used in the publicly-traded partnership investment community to assist in evaluating a partnership's ability to make quarterly cash distributions. Operating Surplus is not required by accounting principles generally accepted in the United States and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

3. Available Cash
Available Cash generally means for each fiscal quarter, all cash on hand at the end of the quarter:

  • less the amount of cash reserves established by the Board of Directors to:

  • provide for the proper conduct of Navios Midstream's business (including reserve for maintenance and replacement capital expenditures);

  • comply with applicable law, any of Navios Midstream's debt instruments, or other agreements; or

  • provide funds for distributions to the unitholders and to the general partner for any one or more of the next four quarters;

  • plus all cash on hand on the date of determination of available cash for the quarter resulting from working capital borrowings made after the end of the quarter. Working capital borrowings are generally borrowings that are made under any revolving credit or similar agreement used solely for working capital purposes or to pay distributions to partners.

Available Cash is a quantitative measure used in the publicly-traded partnership investment community to assist in evaluating a partnership's ability to make quarterly cash distributions. Available cash is not required by accounting principles generally accepted in the United States and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

4. Reconciliation of Non-GAAP Financial Measures

Three Month
Period ended
September 30, 2015
($ '000)
(unaudited)
Three Month
Period ended
September 30, 2014
($ '000)
(unaudited)
Nine Month
Period ended
September 30, 2015
($ '000)
(unaudited)
Nine Month
Period ended
September 30, 2014
($ '000)
(unaudited)
Net cash provided by operating activities $ 6,393 $ 5,089 $ 24,110 $ 15,029
Net increase/(decrease) in operating assets 7,252 29 10,187 (62 )
Net (increase)/ decrease in operating liabilities (317 ) 211 3,232 (230 )
Net interest cost 3,238 7,120 7,601 21,343
Amortization of deferred finance cost and bond premium (357 ) (190 ) (2,321 ) (554 )
EBITDA $ 16,209 $ 12,259 $ 42,809 $ 35,526
Net cash provided by operating activities $ 6,393 $ 5,089 $ 24,110 $ 15,029
Net cash used in investing activities $ -- $ (8,511 ) $ (72,252 ) $ (38,906 )
Net cash (used in) / provided by financing activities $ (9,473 ) $ 6,928 $ 48,610 $ 20,782
Three Month
Period ended
September 30,
2015
($ '000)
(unaudited)
Nine Month
Period ended
September 30,
2015
($ '000)
(unaudited)
EBITDA $ 16,209 $ 42,809
Cash interest paid 2,881 5,256
Maintenance and replacement capital expenditures 3,591 8,093
Operating Surplus $ 9,737 $ 29,460
Cash distribution paid relating to the first six months -- (16,401 )
Cash reserves (995 ) (4,317 )
Available cash for distribution $ 8,742 $ 8,742

Investor Relations Contacts

Navios Maritime Midstream Partners L.P.
+1 (212) 906 8647
Email Contact

Source: Navios Maritime Midstream Partners L.P.