Navios Maritime Partners LP

Thank you for joining us for Navios Maritime Partners Third Quarter 2021 Earnings Conference Call. With us today from the company are Chairwoman and CEO, Ms. Angeliki Frangou, Chief Operating Officer, Mr. Stratos Desypris, Chief Financial Officer, Ms. Eri Tsironi, and Executive Vice President of Business Development, Mr. George Akhniotis. As a reminder, this conference call is being webcast. To access the webcast, please go to the investor section of Navios Maritime Partners website at www.navios-mlp.com. You'll see the webcasting link in the middle of the page and a copy of the presentation referenced in today's earnings conference call will also be found there. Now, I will review the Safe Harbor Statement. This conference call should contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Navios Partners. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are based upon the current beliefs and expectations of Navios Partners management and are subject to risks and uncertainties which would cause actual results to differ materially from the forward-looking statements. Such risks are more fully discussed in Navios Partners filings with the Securities and Exchange Commission. The information set forth herein should be understood in light of such risks. Navios Partners does not assume any obligation to update the information contained in this conference call. The agenda for today's call is as follows. First, Ms. Frangou will offer opening remarks. Next, Mr. Desypris will give an overview of Navios Partners segment data. Next, Ms. Tsironi will give an overview of Navios Partners financial results. Then, Mr. Akhniotis will provide an operational update and an industry overview. And lastly, we'll open the call to take questions. Now I turn the call over to Navia Partners Chairwoman and CEO, Ms. Angeliki Frangou. Angeliki?

Thank you, Daniela, and good morning to all of you joining us on today's call. I am pleased with the results for the third quarter of 2021. During Q3, Navios Partners recorded revenue of $228 million, adjusted EBITDA of $145.2 million, and net income of $162.1 million. Please turn to slide 4. On October 15, 2021, we completed a transformative merger with Navios Acquisition. Today, NMM is one of the largest U.S. publicly listed shipping companies with 15 vessel types diversified across three segments and servicing more than 10 end markets. About a third of our fleet operates in each of the dry bulk container ships and tiger segments. We believe that this combination offers a stronger, more resilient entity, mitigating sector-specific cyclicality. NMM has a solid balance sheet and a modest leverage, a healthy income statement and a pipeline of about 2.2 billion in contracted revenue. Overall, our diversified platform should provide flexibility allowing us to capitalize on cross-segment opportunities. We expect to be able to provide more predictable returns to our unit holders despite uneven sector performance. As shown on slide 5, 2021 has been a transformational year as we expanded in new segments. Here today, in 2021, our fleet increased by 163% in terms of number of vessels through 88 net vessel additions. Through these S&P activities, We increased our fleet size and reduced average age for our existing segments. For container ships we increased fleet size by 330% and reduced average age by 24%. For dry bulk, we increased capacity by 36% and reduced average age by 18%. Of course, we also entered into the crude and product tanker segments. In sum, as shown on the chart on the bottom of the slide, we have increased available days by 171% to 47,268 available days. thereby accumulating significant scale in a short period of time. Slide 6 details our company highlights. As I mentioned previously, Navios Partners is one of the largest US publicly listed companies with over 140 vessels. We operate in three segments, have 15 diversified vessel types, and serve over 10 end markets. Our diversification strategy creates resilience in the overall business model and enables us to mitigate individual segment volatility while also allowing us to leverage each independent sector's fundamentals. Diversification also provides flexibility in our operational and financial strategies as we charter, sell and purchase vessels and obtain debt finance. The net result is that we should have more predictable We also anticipate that diversification and scale should make NMM a more attractive investment platform as we take advantage of global trade patterns. Our three pillars are now working well. Both dry bulk and container ship sectors are performing and the tanker sector has improved materially in the past few months with more improvement expected. Slide 7 reviews our recent developments. During Q3, NMM generated $228 million in revenue, $145.2 million in adjusted EBITDA, and $162.1 million in net income. For the nine months of 2021, NMM generated $469.8 million in adjusted EBITDA and $398.6 million in net income. In 2021, we've completed two mergers. Our merger with Navios Containers Increased our container ships by 29 vessels. The recently completed merger with Navios Acquisition gave us a strong foothold in the tanker sector with 45 tanker vessels. We also continue to renew and expand our fleet. Year to date we expanded our dry bulk fleet by 10 vessels, increasing dry bulk capacity by 36% and reducing its average age by 18%. The busy acquisition calendar has not distracted us from our balance sheet. We remained disciplined. Our gas balance was $141.2 million as of September 30th, and we have 28.3% in net LTV. About 91% of our debt is covered by the scrap value of our vessels alone. We have been taking advantage of robust markets. NMM has 2.2 billion of contracted revenue. We will be profitable in Q4 as contracted revenue exceeds total expenses by $57 million. Yet, we still have 2,473 open or index-linked days. For 2022, we expect a historically low break-even of $2,469 per open day, with 20 Our busy acquisition calendar has not distracted us from our balance sheet. We remain disciplined. Our cash balance was $141.2 million as of September 30th, and we have 28.3% debt on TV. About 91% of our debt is covered by the scrap value of our vessels alone. We have been taking advantage of low-pass markets and MM has $2.2 billion of contracted revenue. We have been profitable in Q4 as contracted revenue exceeds total expenses by $57 million, yet we still have about 2,473 open or indexed linked days. For 2022, we expect a historically low break-even of $2,469 per open day with 58% of 47,268 available days open or intensely linked, providing us with a market exposure. Diversification takes advantage of global trade patterns and slide 8 illustrates this. A balanced exposure across the dry band, container ship, and tanker segment allow us to mitigate normal industry cyclicality and leverage fundamentals on offer across all sectors through our chartering and capital allocation and financing strategies. Currently, in our container ship segment, given the continuous strength of the market, we have been locking in long-term charters. As a result, we fixed 88.1% of our available container ship days for 2022 and have $1.6 billion in total contracted revenue on charters extending through 2030. Moving from strength to strength in our dry bulk segment, we continue to benefit from a strong spot market with 87% of our 2022 available days exposed to market rates and we remain in position to fix vessels when attractive period charters are available. Lastly, within our tanker segment, our long-term contracts provide protection and 65% of our 2022 available days remain open to capture the ongoing market recovery. While we are positioned to capture the market upside through our forward available days, our diversified chartering strategy has enabled to secure a pipeline of over 2.2 billion of contracted revenue. At this point, I'd like to turn the call over to Mr. Stratios Desypris, our Chief Operating Officer that will take you through the segment data. Stratos.

Thank you, Angeliki, and good morning all. NMM is differentiated by its industry-leading scale and diversified sector exposure. Please move to slide 9, which provides some selected segment data. Navios Partners controls 142 vessels with balanced exposure to the dry bulk container ship and tanker segments. Also, we have strengthened stability in our balance sheet. Net loan-to-value is about 28.3%, in an asset base estimated at over 4.5 billion. Moreover, Navios optimizes its flexible chartering strategy to leverage on fundamentals across its three sectors and calibrate charter terms based upon segment opportunity. We have a contracted revenue pipeline of about 2.2 billion and about 58% of our 2022 available days are currently exposed to the market. Our market exposure days are calibrated towards dry bulk and tanker vessels while about 88% of our container ships are fixed. Slide 10 details our strong operating free cash flow potential. For Q4 of 2021, our contracted revenue exceeds total expenses by approximately $57 million and we have around 2,500 days with market exposure that will provide additional operating free cash. For 2022, we have fixed approximately 42% of our open days at $29,350 per day and our contracted revenue provides for a break-even of $2,469 per open day. We have 27,437 open and index days that can generate significant operating cash. In slide 11, you can see the strength and stability of our balance. As of September 30, we had the total cash of $141.2 million and borrowings of $1.4 billion. Leverage remains very low and net loan-to-value is 28.3%, in an asset base estimated at over 4.5 billion. Additionally, we have a staggered maturity profile with no significant maturities through 2023. That, together with our contracted revenue of 2.2 billion, provides an enduring platform with significant upside potential. Turning to slide 12, you can see some fleet and debt updates. We have fixed 10 of our container ships for long durations, creating approximately 690 million in contracted revenue. More specifically, we have contracted our six new building container ships delivering in 2023 and 2024 for five years at an average rate of $37,050 net per day, generating about $420 million of contracted revenue. These vessels were acquired for an aggregate purchase price of $370 million. We have also chartered out 4,250 TEU container ships for periods between three and a half and four and a half years, generating revenues of approximately $270 million. The current average contracted net rate of the four vessels is approximately $2,600 per day. On the S&P, we have sold the 2006 Panamax vessel for $14 million. We are also constantly working on refinancing and extending maturities. We have arranged a new facility of $72.7 million for the refinancing of three existing facilities with short and medium term durations. Additionally, we have agreed a new 52.7 million bare boat financing for two Capsar Max vessels to be delivered in the second half of 2022 and Q1 of 2023. I now pass the call to Erif Tsironi, our CFO, which will take you through the financial highlights. Erif?