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spk04: Quarter 2022 Earnings Conference Call. We are pleased to host this call from the Cayman Islands. With us today from the company, our Chairwoman and CEO, Ms. Angeliki Frangou.
spk06: Thank you, George.
spk05: Slide 7 provides an overview of Navios Logistics. Navios Logistics operates three port terminals.
spk04: Good morning, and thank you for joining Navios 2022 Earnings Conference Call. We are pleased to host this call from the Cayman Islands. With us today from the company are Chairwoman and CEO Ms Angeliki Frangu, Chief Financial Officer Mr George Akneiotis and SVP of Strategic Planning Mr Yanis Kariotis. I'll now turn the call over to Ms Daniela Guerrero who will take you through the conference call details and safe harbour statements. Daniela.
spk02: Thank you. As a reminder, this conference call is being webcast. To access the webcast, please visit the investor section of Navios Maritime Holdings website at www.navios.com. You'll see the webcast link in the middle of the page, and a copy of the presentation referencing today's call will also be found there. Now, I will review the Safe Harbor Statement. This conference call could contain forward-looking statements under the meaning of the Private Securities Litigation Reform Act of 1995 about Navios Maritime Holdings. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are based upon the current beliefs and expectations of Navios Maritime Holdings management and are subject to risks and uncertainties, which would cause actual results to differ from the forward-looking statements. Such risks are more fully discussed in Navier Maritime Holdings' filings with the Securities and Exchange Commission. The information set forth herein should be understood in light of such risks. Navier Maritime Holdings does not assume any obligation to update the information contained in this conference call.
spk04: The agenda for today's conference call is as follows. We will begin this morning's conference call with formal remarks from the management team, and after, we will open the call to take questions. Now, I turn the call out to Navier's Holdings Chairwoman and CEO, Ms. Angeliki Frange. Angeliki.
spk00: Thank you, Michael, and good morning to all of you joining us on today's call. I am pleased with the results for the second quarter of 2022. In the second quarter, Navier's Holdings reported revenue of $159.2 million, EBITDA of $98.9 million, and net income of $45 million. For the six months of 2022, Navios Holdings recorded revenue of $287 million, EBITDA of $172.7 million, and net income of $40 million. Most importantly, we sold our dry fleet at a good time and used the $835 million of sales proceeds to pay down $784.2 million of debt. George will address how we use these funds to deliver our balance sheet. With the closing of the sale behind us, we have exited fleet ownership and now have two primary investments. The first is a 63.8% ownership interest in Navio South American Logistics, a logistics and infrastructure provider in the Hidrovia region of South America. we can refocus on the opportunity this unique group of assets provide. Giannis Kariotis will in a moment drill down on the company, but I will remind you that our primary transshipment asset is located in the tax-free zone in Uruguay at the mouth of the river, which means that water levels are unaffected by the droughts. Our contract with Vale is unaffected by the recent sale of the mine to J&F, and equally importantly, we believe that J&F will increase its volumes. There is a great deal of other new activity in iron ore mining, which positively affects our operations. The second investment is a 10.3% ownership interest in Navios Partners. This investment has excellent potential economic returns as the analyst estimated NAV is well above the current market price. We believe that we also have some margin of safety as Navios Partners is a well-diversified maritime company. I would like now to turn the call over to Mr. George Asniotis, Navius Holdings CFO, who will take us through the financial.
spk06: George? Thank you, Angeliki. Please turn to slide five for a review of the Navius Holdings financial highlights for the second quarter and first six months of 2022. EBITDA for the quarter was 98.9 million compared to 80.5 million in Q2 of 2021, a 23% increase. The increase is mainly due to a 25% increase in the time charted equivalent rate achieved by the fleet in the quarter and a 48% increase in the results of NAVIO South American logistics compared to Q2 of 2001. The improvement is also reflected in the net income of the company. During Q2 2022, we recorded net income of 45 million compared to 24.9 million in 21, an improvement of 80%. Moving to the first half financial highlights, EBITDA for the first half of 2022 was $172.7 million compared to $135.1 million in the first half of 2021, an improvement of 28%. The TCE rate achieved in the first six months of 2022 was 37% higher than in 2021, and the results of NAVI South American Logistics were 24% higher than the first six months of 2021. Net income for the period was $40 million, compared to $25.1 million in the first half of 2021. The income for 2022 includes $24 million upfront fee paid in the form of convertible debenture for the refinancing of the ship mortgage notes in Q1. I would like to point out that with the sale of the fleet, the results of the company will be a little noisy initially and then materially different going forward. In Q3, we will record the gain from the sale of the fleet and some revenue from charters during the period. However, commencing in Q4, our operating results will not include any revenue from vessels. Instead, they will only include the results from NATO South American logistics, which has always been consolidated. Moving to slide six in our balance sheet highlights, as of June 30th, 2022, the cash balance was about $55 million compared to about $138 million at the end of December 21. I want to remind you that at the end of December, 84 million was restricted cash that was deposited with the trustee of the SHIP Mortgage Notes in order to facilitate the repayment of the notes in January. Following the repayment of the SHIP Mortgage Notes and the partial repayment of the Senior Secured Notes in the first half of the year, our bonds reduced from 1.1 billion at the end of the year to 584 million at the end of June 2022. In OCAS, we fully repaid the Senior Secured Notes. Following the sale of the fleet in Q3, the majority of the proceeds were used to deliver the balance sheet by reducing debt and other liabilities as follows. $441.6 million bank debt, finance lease liabilities, and bare boat obligations that have been assumed by Navios Partners. $262.6 million mandatory repayment of loans associated with the manager, and $80 million to fully repay the senior secure notes. The full effect of the sale of the fleet will be more clearly reflected in the Q3 balance sheet and income statement. Similar to the income statement, the consolidated balance sheet going forward will mainly reflect the balance sheet of NAVIO South America Logistics. At this point, I turn the call over to Yanis for his review of the NAVIO South America Logistics results.
spk05: Thank you, George. Slide 7 provides an overview of Navios Logistics. Navios Logistics operates three port terminals, which are complemented by our barge fleet for river transportation and product tanker fleet for coastal cabotas trade. Please turn to slide 8. The prospects for Navios Logistics have always been good and are improving. The global focus on food security, because of geopolitical tensions, is expected to benefit the exports of agricultural commodities from South America. In fact, in the first half of this year, grain exports through our port in Uruguay are 49% higher year on year. According to USDA, the 2022-23 South American soybean crop is expected to be even stronger, and more importantly, for our grain terminal, Paraguayan crop that failed this year is expected to recover. We also see a revived interest in the exploitation of the mining assets of Corumbi in Brazil, which exports through the Hidrovia river system. Vale recently sold its Midwestern system mining assets, which were underutilized for many years, to J&F, and production should grow under the new ownership. Meanwhile, Vetri and Cargill continue to export using our port terminal, And this year, we added a third client to our iron ore port terminal, 4B Mining, which started production and exports this year. The increase in iron ore export volumes benefits BART's business and our port terminal. In the last couple of years, low water in the Paranae and Paraguay rivers made navigation conditions difficult, affecting the profitability of our BART's business. In 2022 so far, the water levels have improved compared to both 2020 and 2021, yet is still below the historical average. Navis Logistics owns unique, well-located, modern infrastructure assets with the capacity to service increased demand from our clients. We also have available land to develop new business in a growing part of the world. Please turn to page 9. Q2 2022 EBITDA was 32 million, 48% higher compared to the same quarter last year. Port segment EBITDA grew 34% to 24.5 million, mainly driven by a 40% increase in the grain port throughput attributed to higher Uruguayan exports of soybeans and higher tariffs at the iron ore port terminals. In the barge segment, Q2 2022 EBITDA increased 36% to 5.3 million, mainly due to higher liquid cargo and higher other income from foreign exchange differences. In the cabotage business, Q2 2022 EBITDA increased by 2.7 million to 2.2 million due to more operating days of the fleet, as the market environment in Argentina has improved compared to last year. For Q2 2022, profit was 6.4 million compared to 0.8 million loss in the same period last year, mainly due to improved performance of the company. Turning to the financial results for the six-month period ending June 30, 2022, Revenue increased 16% to 127.8 million. EBITDA increased 24% to 56.2 million. And profit increased by 4.3 million to 6 million compared to the same period last year. Please turn to slide 10. NABUS Logistics has no significant debt maturities until 2025. Cash and cash equivalent at the end of the second quarter of 2022 were 37.6 million. This concludes my presentation. I would now like to turn the call over to Angeliki for her final comments. Angeliki?
spk00: Thank you, Yannis. This completes our formal presentation, and we open the call to questions.
spk03: Thank you. At this time, if you would like to ask a question, please press star 1 on your touchtone phone. You may remove yourself from the questioning queue at any time by pressing star 2. Once again, that is star 1 to ask a question. We will pause for a moment to allow questions to queue. Again, that was star 1 if you would like to ask a question. I am showing no questions at this time. I'll now like to turn the call back over to Angeliki for closing remarks.
spk00: Thank you. This is an important quarter. We completed the sale of our dry park fleet for over $830 million, and we used the proceeds to deliver and pay down about $780 million. On the backdrop of the food security and energy consideration around the world, We think that concentrating in other South American logistics where we control critical infrastructure is going to be very important and favorable. We have the oil-dedicated iron ore port and the largest independent grade terminal in Hydrovia in an area that is rich in commodities and grains. Also, we see our port is in the mouth of the river where we are affected from the drought and we are in a tax resort. Also, we see that the increased activity in iron ore with new players coming in the mines, J&F, Regria, 4B Mines, we see all these new players bringing iron ore down the river and also coming to our port. So we see favorable growth in the area.
spk01: Thank you. This completes our quarterly results.
spk03: Thank you, ladies and gentlemen. This concludes today's event. You may now disconnect.
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