Mpc Container Ships As

Welcome to MPC Container Ships Q4 2023 earnings call. For the first part of this call, all participants are in a listen-only mode. Afterwards, there will be a question and answer session. To ask a question, please press 5-star on your telephone keypad. This call is being recorded. I'll now turn the call over to speakers. Please begin.

Thank you, Operator. Good afternoon and good morning, everyone. This is Konstantin Bach, CEO of MPC Containerships, and I'm joined by our CFO, Moritz Fuhrmann. I would like to welcome you to our Q4 2023 earnings call. Thank you for joining us today to discuss MPC Containerships fourth quarter earnings. This morning, we have issued a stock market announcement covering MPCC's fourth quarter and full year results for the period ending December 31st. The release as well as the accompanying presentation for this conference call are available on the investor media section of our website. Please note and be advised that the material provided and our discussion today contain forward-looking statements and indicative figures. Actual results may differ materially from those stated or implied by forward-looking statements due to the risks and uncertainties associated with our business. Before we start with today's presentation, a few words from my side, reflecting on the fourth quarter and the full year 2023. We are pleased to report another solid performance and very robust financials today. The results underscore MPC Containership's continued progress, resilience, and ability to maintain operational excellence in a volatile market environment with modest growth and geopolitical challenges. Fleet utilization remained high and we continue to adhere to our low leverage strategy with a leverage of 13% and a high number of vessels debt free. Throughout 2023, MPCC has emphasized sustainability initiatives, working closely with our charter customers to conclude mutual projects and investments with an aim to reduce carbon emissions and foster a more environmental friendly maritime landscape. MPCC recently set new greenhouse gas emissions intensity reduction targets in line with the IMO's industry carbon intensity targets, demonstrating our dedication to decreased emissions while we remain also strongly committed to our low leverage strategy and distribution policy. Another key feature of our performance is our commitment to shareholder returns. including the dividend declared for the fourth quarter, our total dividends distributed and declared over the last 12 months amount to approximately 350 million, representing more than 50% of the company's market cap at the beginning of 2023. Looking ahead, our charter backlog remains robust, providing us with significant earnings visibility and reinforces our confidence going forward. With that said, I would like to hand over to my colleague and CFO, Moritz Fullmann, who will guide us through the first agenda point.

Thank you, Konstantin. Turning to the first agenda point, as just mentioned, being the full year 23 highlights, we have posted, in our view, very strong full year financial figures with $711 million in gross revenues and close to $430 million in adjusted EBITDA. We as a company have distributed $0.64 per share, leading to dividend yield in 23% of more than 40% and 10% already implied in 24% as a dividend just announced by the board. While returning capital to shareholders, we have continued to deliver the balance sheet with a current leverage ratio of 13%, which arguably is industry low from a container company perspective. On the asset side, we have continuously worked on our fleet optimization as we went through 23 and as we have divested 13 older vessels and acquired seven younger ships. From a market perspective, the container markets have seen a recent uplift fueled by the geopolitical events in the Middle East. However, it remains to be seen, though, how sustainable the entire situation is. When turning to the next slide and looking at some of the fourth quarter 23 KPIs, the quarterly financial performance is more or less in line with the previous quarters when adjusting for certain non-recurring items. In Q4, MPCC has taken further impairments on the fleet, as well as carpeg write-offs in the tune of 41 million US dollars. Those effects have been normalized from a dividend calculation, and consequently, the board declared another dividend of $13 per share. From a cash flow generation perspective, the performance remains strong, and as mentioned before, debt has been reduced further, now standing at $4 million in net debt and with a low leverage ratio of 13%. Operationally, the fleet remains well employed with an average TCE of close to $27,500 per day for Q4. And at the same time, fleet utilization remains high with 98%, being again a testament to the operational performance of our fleet. Talking about operations and turning to the next slide. In 2023, we as a company have planned retrofit investments of a total of $23 million across a number of vessels, leading up to 20% improvements from an emission perspective. And some of those retrofits are actually combined with an early charter extension as well as cost-sharing arrangements with the respective operator. On the new building side, we announced earlier this year the investment into one additional new build being a 1300 TU that comes with a seven year time charter with Unifeeder being one of the largest feeder operator globally. The vessel itself will be owned in a joint venture structure together with the operator. And I think most importantly, this investment is in line with previous new building deals that we have done as this investment is also fully covered through the contracted EBITDA. When it comes to the geopolitical situation in the Middle East, and the Red Sea in particular, and in view of crew safety, MPCC vessels discontinued transmitting through the Red Sea, and as of today, we have no exposure to the geopolitical events going on in the Middle East. Turning to the next slide and looking at our portfolio, We have seen a short-term strengthening in the time charter market and consequently managed to fix a number of vessels at relatively attractive rates, but also at decent durations up to 12 months. The most recent fixtures we can report were around $16,500 per day for 2,800 TU and close to $18,500 per day for 3,500 TU. In addition, we have agreed early time charter extensions, as mentioned before, with rate blendings, as well as early extensions in combination with retrofit investments. In those particular instances, MPCC agreed a floor-ceiling structure with upside sharing for the extension period, especially with one particular customer. On the S&P side, we have successfully handed over the vessels RS Vomina and RS Paulina since we announced the sale late 2023. And in addition, we have agreed the sale of RS Clarita for US$10.3 million with dried-off due delivery in Q2 or Q3, and hence managing some of our Carpex positions in 2024. Looking at the cash development on the next slide, again, a very strong operational performance of $532 million in operations cash flow, setting the base for the debt reduction vessel investments, as well as significant dividend payouts in 2023. The cash position remained almost unchanged relative to last year, despite significant investments, debt reductions and dividends. The cash development is, in our view, testament to our ability in managing fleet renewal as well as shareholder return while maintaining a low leverage. In addition, at the end of 23, we have added a new revolving credit facility, which remains undrawn as of today and gives us as a company additional capacity in the tune of 100 million US dollars. Turning to the next slide, which is the dividend slide, and a fantastic graph to show. Again, a continued strong dividend performance as the board declared another recurring dividend of $13 cents to be distributed in March. Full year, 23 dividend yields of more than 40%, which is more or less in line with 2022. And a year-to-date yield of 10% already basis the January share price. This brings the total distributions to shareholders to $790 million, since we embarked on our dividend journey in early 2022. And on that positive note, I'm handing over to Konstantin for some market updates.