Navios Maritime Holdings Inc. Reports Financial Results for the Fourth Quarter and Year Ended December 31, 2017

  • $463.0 million revenue for 2017; $128.5 million for Q4 2017
  • $50.8 million net cash from operating activities for 2017; $14.4 million for Q4 2017
  • $126.8 million Adjusted EBITDA for 2017; $46.7 million Adjusted EBITDA for Q4 2017
  • $134.2 million cash as of December 31, 2017
  • Fleet renewal and expansion 2017-2018YTD;
       •   Nine vessels added (eight chartered-in, three with purchase options)
       •   Two vessels sold
       •   ~11% increase in fleet capacity
  • $12,305/day TCE for Q4 2017
  • Positioned to capture market recovery:
       •   22,684 available days for 2018
       •   16,567 open and index days for 2018

MONACO, Feb. 21, 2018 (GLOBE NEWSWIRE) — Navios Maritime Holdings Inc. (“Navios Holdings” or “the Company”) (NYSE:NM), a global, vertically integrated seaborne shipping and logistics company, today reported financial results for the fourth quarter and year ended December 31, 2017.

Angeliki Frangou, Chairman and Chief Executive Officer, stated, “I am pleased with the results of the full year and fourth quarter of 2017.  For the full year, we reported revenue and Adjusted EBITDA of $463.0 million and $126.8 million, respectively.  For the fourth quarter, we reported revenue and Adjusted EBITDA of $128.5 million and $46.7 million, respectively.  Rates for dry bulk vessels have improved materially, and in Q4 2017 we began to enjoy the effects of healthier charter markets.”

Angeliki Frangou continued, “We are expanding our fleet capacity and creating market exposure at an opportune time. During the past nine months, we added nine younger vessels (eight kamsarmaxes and one cape) and sold two older vessels, thereby increasing fleet capacity and improving the average age of our fleet by 11%.   We did this using modest capex, as we chartered in the kamsarmaxes, three with favorable purchase options. Also, our chartering strategy created market exposure for 73% of our 22,684 available days in 2018.”

HIGHLIGHTS – RECENT DEVELOPMENTS

Fleet update – Renewal and Expansion

Navios Holdings controls a fleet of 72 vessels totaling 7.3 million dwt, of which 39 are owned and 33 are chartered-in under long-term charters (collectively, the “Core Fleet”). The fleet consists of 21 Capesize, 31 Panamax, 18 Ultra Handymax and two Handysize vessels, with an average age of 7.7 years, basis fully delivered fleet.

Navios Holdings agreed to charter-in eight Panamax vessels, five of which under long term time charters and three of which under bareboat charters with purchase options. In January 2018, Navios Holdings took delivery of the first vessel. The remaining seven vessels are expected to be delivered at various dates though the first quarter of 2020.

In February 2018, Navios Holdings acquired Navios Equator Prosper, a 2000 built 171,191 dwt vessel, previously a chartered-in vessel, for an acquisition price of $10.0 million.

Following the above transactions, Navios Holdings has increased its fleet capacity by 11% and decreased the average fleet age, basis fully delivered fleet, by 11%. In addition, 70% of the chartered-in fleet has purchase options.

As of February 12, 2018, Navios Holdings has chartered-out 65.2% of available days for 2018, out of which 27.0% on fixed rate and 38.2% on index or profit sharing. The average contracted daily charter-in rate for the long-term charter-in vessels for 2018 is $12,952.

The above figures do not include the fleet of Navios Logistics and vessels servicing contracts of affreightment.

Exhibit II provides certain details of the Core Fleet of Navios Holdings. It does not include the fleet of Navios Logistics.

Navios Maritime Partners L.P. (“Navios Partners”)

On February 13, 2018, Navios Partners announced that it has agreed with investors to sell approximately 18.4 million common units for an aggregate of approximately $35.0 million in a registered direct offering at $1.90 per common unit, which includes the sale of approximately $5.0 million of common units to Navios Holdings. The offering is expected to close on or about February 21, 2018.  Following the closing of this offering, Navios Holdings will hold a 20.2% interest in Navios Partners, including the 2% general partnership interest.

Earnings Highlights

EBITDA, Adjusted EBITDA, Adjusted Net Loss and Adjusted Basic Loss per Share are non-U.S. GAAP financial measures and should not be used in isolation or as substitution for Navios Holdings’ results calculated in accordance with U.S. GAAP.

See Exhibit I under the heading, “Disclosure of Non-GAAP Financial Measures,” for a discussion of EBITDA, Adjusted EBITDA, Adjusted Net Loss and Adjusted Basic Loss per Share of Navios Holdings (including Navios Logistics), and EBITDA of Navios Logistics (on a stand-alone basis), and a reconciliation of such measures to the most comparable measures calculated under U.S. GAAP.

Fourth Quarter 2017 and 2016 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The fourth quarter 2017 and 2016 information presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.

    Three Month Period Ended   Three Month Period Ended  
     December 31,    December 31,  
    2017   2016  
    (unaudited)   (unaudited)  
Revenue $ 128,530     $ 99,475      
Net Loss $ (51,601 )   $ (242,439 )    
Adjusted Net Loss $ (12,580 ) (1 ) $ (27,644 ) (2 )  
Net cash provided by/ (used in) operating activities $ 14,370     $ (5,357 )    
EBITDA $ 7,669     $ (185,694 )    
Adjusted EBITDA $ 46,690   (1 ) $ 29,101   (2 )  
Basic Loss per Share $ (0.46 )   $ (1.80 )    
Adjusted Basic Loss per Share $ (0.13 ) (1 ) $ (0.28 ) (3 )  

(1)   Adjusted EBITDA, Adjusted Net Loss and Adjusted Basic Loss per Share for the three months ended December 31, 2017 exclude (i) $36.3 million impairment losses of one vessel and intangible asset and (ii) bond extinguishment losses of $2.7 million.
(2)   Adjusted EBITDA and Adjusted Net Loss for the three months ended December 31, 2016 exclude (i) $228.0 million other-than-temporary impairment (“OTTI”) relating to our investments in affiliates and (ii) debt extinguishment gains of $13.2 million.
(3)   Adjusted Basic Loss per Share for the three months ended December 31, 2016 exclude items referred in footnote (2) as well as a benefit of $46.6 million following the completion of the Series G and Series H Exchange Program.

Revenue from dry bulk vessel operations for the three months ended December 31, 2017 was $78.6 million as compared to $56.5 million for the same period during 2016. The increase in dry bulk revenue was mainly attributable to (i) the increase in the time charter equivalent (“TCE”) per day by 45.7% to $12,305 per day in the fourth quarter of 2017, as compared to $8,445 per day in the same period of 2016; and (ii) an increase in available days of our fleet by 253 days, mainly due to an increase in long-term charter-in fleet available days.

Revenue from the logistics business was $49.9 million for the three months ended December 31, 2017 as compared to $43.0 million for the same period in 2016. The increase was mainly attributable to (i) a $11.7 million increase in revenue from the port terminal business mainly due to the commencement of operations at the new iron ore terminal and (ii) a $1.3 million increase in revenue from the cabotage business mainly due to an increase in operating days. The overall increase was partially mitigated by (i) a $4.8 million decrease in revenue from the barge business mainly due to the expiration of certain iron ore transportation contracts; and (ii) a $1.3 million decrease in sales of products mainly due to a decrease in the Paraguayan liquid port’s volume of products sold.

Net Loss of Navios Holdings was $51.6 million and $242.4 million for the three months ended December 31, 2017 and 2016, respectively.  Net Loss was affected by the items described in the table above. Excluding these items, Adjusted Net Loss of Navios Holdings for the three months ended December 31, 2017 was $12.6 million as compared to $27.6 million for the same period of 2016. The $15.0 million decrease in Adjusted Net Loss was mainly due to (i) an increase in Adjusted EBITDA by $17.6 million and (ii) an increase in income tax benefit of $2.0 million. This overall increase of $19.6 million was partially mitigated by (i) an increase in interest expense and finance cost, net by $3.6 million; (ii) an increase in depreciation and amortization by $0.8 million; (iii) an increase in amortization for deferred drydock and special survey costs of $0.1 million; and (iv) an increase in share-based compensation expense of $0.1 million.

Net loss of Navios Logistics was $0.2 million for the three month period ended December 31, 2017 as compared to $5.7 million for the same period in 2016.

Adjusted EBITDA of Navios Holdings for the three months ended December 31, 2017 increased by $17.6 million to $46.7 million as compared to $29.1 million for the same period of 2016. The increase in Adjusted EBITDA was primarily due to (i) a $29.0 million increase in revenue and (ii) a $3.3 million decrease in direct vessel expenses (excluding the amortization of deferred drydock and special survey costs). This overall increase of $32.3 million was partially mitigated by (i) a $7.4 million decrease in equity in net earnings from affiliated companies; (ii) a $2.0 million increase in net income attributable to noncontrolling interest; (iii) a $1.9 million increase in general and administrative expenses (excluding share-based compensation expenses); (iv) a $1.9 million increase in other income/ (expense), net; and (v) a $1.5 million increase in time charter, voyage and logistics business expenses.

EBITDA of Navios Logistics was $15.0 million for the three month period ended December 31, 2017, as compared to $7.1 million for the same period in 2016.

Year Ended December 31, 2017 and 2016 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The information for the year ended December 31, 2017 and 2016 presented below was derived from the unaudited condensed consolidated financial statements for the respective periods.

  Year
Ended
  Year
Ended
 
   December 31,    December 31,  
  2017   2016  
  (unaudited)   (unaudited)  
Revenue $ 463,049     $ 419,782    
Net Loss $ (165,910 )   $ (303,823 )  
Adjusted Net Loss $ (107,971 ) (1 ) $ (106,130 ) (4 )
Net cash provided by operating activities $ 50,784     $ 36,920    
EBITDA $ 68,813     $ (62,827 )  
Adjusted EBITDA $ 126,752   (1 ) $ 129,173   (3 )
Basic Loss per Share $ (1.50 )   $ (2.54 )  
Adjusted Basic Loss per Share $ (1.01 ) (2 ) $ (1.14 ) (4 )

(1)   Adjusted EBITDA and Adjusted Net Loss for the year ended December 31, 2017 exclude (i) $36.3 million of impairment losses of one vessel and an intangible asset; (ii) $14.2 million impairment losses on the sale of Navios Ionian and Navios Horizon; (iii) $4.7 million non-cash impairment losses relating to our affiliates; and (iv) bond extinguishment losses of $2.7 million.
(2)   Adjusted Basic Loss per Share for the year ended December 31, 2017 exclude items referred in footnote (1) as well as a benefit of $1.0 million following the completion of the Series G and Series H Exchange Programs.
(3)   Adjusted EBITDA for the year ended December 31, 2016 exclude (i) non-cash OTTI losses of $228.0 million relating to our investment in affiliates, (ii) debt extinguishment gains of $29.1 million, (iii) non-cash losses of $8.0 million relating to our share in Navios Partners’ impairment losses; and (iv) a $14.9 million compensation from the early redelivery of a vessel from its charterer.
(4)   Adjusted Net Loss and Adjusted Basic Loss per Share for the year ended December 31, 2016 exclude items referred in footnote (3) as well as (i) a $7.3 million income from the write-off of an intangible liability due to the early redelivery of a vessel; (ii) a $13.0 million write-off of intangible assets due to the early redelivery of a charter-in vessel; and (iii) a benefit of $46.6 million following the completion of the Series G and Series H Exchange Program.

Revenue from dry bulk vessel operations for the year ended December 31, 2017 was $250.4 million as compared to $199.5 million for the same period during 2016. The increase in dry bulk revenue was mainly attributable to (i) the increase in TCE per day by 18.1% to $9,705 per day in the year ended December 31, 2017 as compared to $8,220 per day in the same period in 2016; and (ii) an increase in available days of our fleet by 1,525 days, mainly due to an increase in long-term charter-in fleet available days.

Revenue from the logistics business was $212.6 million for the year ended December 31, 2017 as compared to $220.3 million for the same period during 2016. The decrease was mainly attributable to (i) a $22.9 million decrease in revenue from barge business mainly due to the expiration of certain iron ore transportation contracts and (ii) a $4.5 million decrease in revenue from the cabotage business mainly due to a decrease in operating days of the cabotage fleet. The overall decrease was partially mitigated by (i) a $17.2 million increase in port terminal revenue due to the commencement of operations at the new iron ore terminal and (ii) a $2.5 million increase in sales of products mainly due to an increase in the Paraguayan liquid port’s volume of products sold.

Net Loss of Navios Holdings was $165.9 million and $303.8 million for the year ended December 31, 2017 and 2016, respectively. Net Loss was affected by the items described in the table above. Excluding these items, Adjusted Net Loss of Navios Holdings for year ended December 31, 2017 was $108.0 million as compared to $106.1 million for the same period of 2016. The $1.9 million increase in Adjusted Net Loss was mainly due to (i) an increase in interest expense and finance cost, net of $6.1 million; (ii) a decrease in Adjusted EBITDA of $2.4 million; (iii) an increase of $1.0 million in share-based compensation expense; and (iv) an increase of $0.9 million in amortization for deferred drydock and special survey costs. This overall increase was partially offset by (i) an increase in income tax benefit of $4.5 million; and (ii) a decrease in depreciation and amortization of $4.0 million.

Net Income of Navios Logistics was $3.1 million for the year ended December 31, 2017, as compared to $10.2 million for the same period in 2016.

Adjusted EBITDA of Navios Holdings for the year ended December 31, 2017 decreased by $2.4 million to $126.8 million as compared to $129.2 million for the same period of 2016. The $2.4 million decrease in Adjusted EBITDA was primarily due to (i) a $38.8 million increase in time charter, voyage and logistics business expenses; (ii) a $24.1 million decrease in equity in net earnings from affiliated companies; and (iii) a $1.4 million increase in general and administrative expenses (excluding share-based compensation expenses). This overall decrease was partially offset by (i) a $43.2 million increase in revenue; (ii) a $11.5 million decrease in direct vessel expenses (excluding the amortization of deferred drydock and special survey costs); (iii) a $2.9 million decrease in other income/ (expense), net; (iv) a $2.6 million decrease in net income attributable to the noncontrolling interest and (v) a $1.7 million gain on debt extinguishment.

EBITDA of Navios Logistics was $62.5 million for the year ended December 31, 2017, as compared to $68.1 million for the same period in 2016.

Fleet Summary Data:

The following table reflects certain key indicators indicative of the performance of Navios Holdings’ dry bulk operations (excluding the Navios Logistics fleet) and its fleet performance for the three month period and year ended December 31, 2017 and 2016, respectively.

  Three Month   Three Month   Year   Year  
  Period Ended   Period Ended   Ended   Ended  
  December 31,   December 31,   December 31,   December 31,  
  2017   2016   2017    2016  
  (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)  
Available Days (1)   5,869       5,616       23,433       21,908    
Operating Days (2)   5,845       5,595       23,359       21,742    
Fleet Utilization (3)   99.6 %     99.6 %     99.7 %     99.2 %  
Equivalent Vessels (4)   64       61       64       60    
TCE (5) $ 12,305     $ 8,445     $ 9,705     $ 8,220    

                                                                 

(1)   Available days for the fleet are total calendar days the vessels were in Navios Holdings’ possession for the relevant period after subtracting off-hire days associated with major repairs, drydocking or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which vessels should be capable of generating revenues.
(2)   Operating days are 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 Holdings’ vessels were available for generating revenue, 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 a company’s efficiency in finding suitable employment for its vessels.
(4)   Equivalent Vessels is defined as the total available days during a relevant period divided by the number of days of this period.
(5)   TCE is defined as voyage and time charter revenues less voyage expenses during a relevant period divided by the number of available days during the period.

Conference Call:
As previously announced, Navios Holdings will host a conference call today, February 21, 2018, at 8:30 am ET, at which time Navios Holdings’ senior management will provide highlights and commentary on earnings results for the fourth quarter and year ended December 31, 2017.

A supplemental slide presentation will be available on the Navios Holdings website at www.navios.com under the “Investors” section by 8:00 am ET on the day of the call.

Conference Call details:

Call Date/Time: Wednesday, February 21, 2018, at 8:30 am ET
Call Title: Navios Holdings Q4 2017 Financial Results Conference Call
US Dial In: +1.877.480.3873
International Dial In: +1.404.665.9927
Conference ID: 309 8887

The conference call replay will be available shortly 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: 309 8887

This call will be simultaneously Webcast. The Webcast will be available on the Navios Holdings website, www.navios.com, under the “Investors” section. The Webcast will be archived and available at the same Web address for two weeks following the call.

About Navios Maritime Holdings Inc.

Navios Maritime Holdings Inc. (NYSE:NM) is a global, vertically integrated seaborne shipping and logistics company focused on the transport and transshipment of dry bulk commodities including iron ore, coal and grain. For more information about Navios Holdings please visit our website: www.navios.com.

About Navios South American Logistics Inc.

Navios South American Logistics Inc. is one of the largest logistics companies in the Hidrovia region of South America, focusing on the Hidrovia region river system, the main navigable river system in the region, and on cabotage trades along the eastern coast of South America. Navios Logistics serves the storage and marine transportation needs of its petroleum, agricultural and mining customers through its port terminals, river barge and coastal cabotage operations. For more information about Navios Logistics please visit its website: www.navios-logistics.com.

About Navios Maritime Partners L.P.

Navios Maritime Partners L.P. (NYSE: NMM) is a publicly traded master limited partnership which owns and operates container and dry bulk vessels. For more information, please visit its website at www.navios-mlp.com.

About Navios Maritime Acquisition Corporation

Navios Acquisition (NYSE:NNA) is an owner and operator of tanker vessels focusing on the transportation of petroleum products (clean and dirty) and bulk liquid chemicals. For more information about Navios Acquisition, please visit its website: www.navios-acquisition.com.

About Navios Maritime Midstream Partners L.P.

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

About Navios Maritime Containers Inc.

Navios Maritime Containers Inc. (N-OTC:NMCI) is a growth vehicle dedicated to the container sector of the maritime industry. For more information, please visit its website at www.navios-containers.com

Forward Looking Statements – Safe Harbor

This press release and our earnings call contain and will contain 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, including 2018 cash flow generation, future contracted revenues, potential capital gains, our ability to take advantage of dislocation in the market and any market recovery, and Navios Holdings’ 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. These forward-looking statements are based on the information available to, and the expectations and assumptions deemed reasonable by Navios Holdings at the time these statements were made. Although Navios Holdings 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 Holdings. 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 uncertainty relating to global trade, including prices of seaborne commodities and continuing issues related to seaborne volume and ton miles, our continued ability to enter into long-term time charters, our ability to maximize the use of our vessels, expected demand in the dry cargo shipping sector in general and the demand for our Panamax, Capesize and Ultra Handymax vessels in particular, fluctuations in charter rates for dry cargo carriers vessels, the aging of our fleet and resultant increases in operations costs, the loss of any customer or charter or vessel, the financial condition of our customers, changes in the availability and costs of funding due to conditions in the bank market, capital markets and other factors, 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, general domestic and international political conditions, competitive factors in the market in which Navios Holdings operates, the value of our publicly traded subsidiaries, risks associated with operations outside the United States; Vale’s obligations under the Vale port contract; and other factors listed from time to time in Navios Holdings’ filings with the Securities and Exchange Commission, including its Forms 20-F and Forms 6-K. Navios Holdings 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 Holdings’ expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. Navios Holdings makes no prediction or statement about the performance of its common stock.

Contact:

Navios Maritime Holdings Inc.
+1.212.906.8643
investors@navios.com   

EXHIBIT I

NAVIOS MARITIME HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of U.S. dollars — except share and per share data)

                         
  Three Month
 Period Ended
 December 31, 2017
    Three Month
 Period Ended
 December 31, 2016
    Year
Ended
 December 31, 2017
    Year
 Ended
 December 31, 2016
   
  (unaudited)     (unaudited)     (unaudited)     (unaudited)    
Revenue $ 128,530     $ 99,475     $ 463,049     $ 419,782  
Administrative fee revenue from affiliates   6,725       5,382       23,667       21,799  
Time charter, voyage and logistics business expenses   (52,301 )     (50,750 )     (213,929 )     (175,072 )
Direct vessel expenses(1)   (26,147 )     (29,368 )     (116,713 )     (127,396 )
General and administrative expenses incurred on behalf of affiliates   (6,725 )     (5,382 )     (23,667 )     (21,799 )
General and administrative expenses(2)   (8,318 )     (6,283 )     (27,521 )     (25,295 )
Depreciation and amortization   (26,219 )     (25,434 )     (104,112 )     (113,825 )
Interest expense and finance cost, net   (30,968 )     (27,435 )     (114,780 )     (108,692 )
Impairment losses   (36,326 )           (50,565 )      
(Loss)/gain on bond and debt extinguishment   (2,695 )     13,231       (981 )     29,187  
Other (expense)/ income, net   (2,037 )     (84 )     (6,826 )     5,206  
Loss before equity in net earnings of affiliated companies   (56,481 )     (26,648 )     (172,378 )     (96,105 )
Equity/(loss) in net earnings of affiliated companies   2,191       (218,420 )     4,399       (202,779 )
Loss before taxes $ (54,290 )   $ (245,068 )   $ (167,979 )   $ (298,884 )
Income tax benefit/(expense)   2,630       572       3,192       (1,265 )
Net loss   (51,660 )     (244,496 )     (164,787 )     (300,149 )
Less: Net loss/ (income) attributable to the noncontrolling interest   59       2,057       (1,123 )     (3,674 )
Net loss attributable to Navios
Holdings common stockholders
$ (51,601 )   $ (242,439 )   $ (165,910 )   $ (303,823 )
Loss attributable to Navios Holdings common stockholders, basic and diluted $ (54,249 )   $ (199,793 )   $ (175,298 )   $ (273,105 )
Basic and diluted net losses per share attributable to Navios Holdings common stockholders $ (0.46 )   $ (1.80 )   $ (1.50   $ (2.54 )
Weighted average number of shares, basic and diluted   117,898,455       110,968,610       116,673,459       107,366,783  

(1 ) Includes expenses of Navios Logistics of $15.5 million and $16.9 million for the three months ended December 31, 2017 and 2016, respectively and $70.5 million and $76.0 million for the year ended December 31, 2017 and 2016, respectively.
(2 ) Includes expenses of Navios Logistics of $5.0 million and $4.0 million for the three months ended December 31, 2017 and 2016, respectively and $16.7 million and $14.3 million for the year ended December 31, 2017 and 2016, respectively. 
     

NAVIOS MARITIME HOLDINGS INC.
Other Financial Data

             
  December 31, 2017    December 31,  2016  
  (unaudited)   (unaudited)  
ASSETS             
Cash and cash equivalents, including restricted cash $ 134,190    $ 141,378  
Other current assets   121,886     131,762  
Deposits for vessels, port terminals and other fixed assets   36,849     136,891  
Vessels, port terminal and other fixed assets, net   1,809,225     1,821,101  
Other non-current assets   251,073     234,612  
Goodwill and other intangibles   276,758     287,151  
Total assets $ 2,629,981   $ 2,752,895  
             
     
LIABILITIES AND EQUITY            
Current liabilities, including current portion of long-term debt, net   236,194     251,783  
Senior and ship mortgage notes, net   1,301,999     1,296,537  
Long-term debt, net of current portion   346,604     324,731  
Other non-current liabilities   128,020     76,291  
Total stockholders’ equity   617,164     803,553  
Total liabilities and stockholders’ equity $ 2,629,981   $ 2,752,895  
             

Disclosure of Non-GAAP Financial Measures

EBITDA, Adjusted EBITDA, Adjusted Net Loss and Adjusted Basic Loss per Share are “non-U.S. GAAP financial measures” and should not be used in isolation or considered substitutes for net income/ (loss), cash flow from operating activities and other operations or cash flow statement data prepared in accordance with generally accepted accounting principles in the United States.

EBITDA represents net (loss)/income attributable to Navios Holdings’ common stockholders before interest and finance costs, before depreciation and amortization, before income taxes and before stock-based compensation. Adjusted EBITDA represents EBITDA, excluding certain items as described under “Earnings Highlights”. Adjusted Loss and Adjusted Basic Loss per Share represent Net Loss and Basic Loss per Share, excluding certain items as described under “Earnings Highlights”. We use EBITDA and Adjusted EBITDA as liquidity measures and reconcile EBITDA and Adjusted EBITDA to net cash provided by operating activities, the most comparable U.S. GAAP liquidity measure. EBITDA is calculated as follows: net cash provided by operating activities adding back, when applicable and as the case may be, the effect of (i) net increase/(decrease) in operating assets, (ii) net (increase)/decrease in operating liabilities, (iii) net interest cost, (iv) deferred finance charges and gains/(losses) on bond and debt extinguishment, (v) (provision)/recovery for losses on accounts receivable, (vi) equity in affiliates, net of dividends received, (vii) payments for drydock and special survey costs, (viii) noncontrolling interest, (ix) gain/ (loss) on sale of assets/ subsidiaries, (x) unrealized (loss)/gain on derivatives, and (xi) loss on sale and reclassification to earnings of available-for-sale securities and impairment charges. Navios Holdings believes that EBITDA and Adjusted EBITDA are a basis upon which liquidity can be assessed and represents useful information to investors regarding Navios Holdings’ ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. Navios Holdings also believes that EBITDA and Adjusted EBITDA are used (i) by prospective and current lessors as well as potential lenders to evaluate potential transactions; (ii) to evaluate and price potential acquisition candidates; and (iii) by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

EBITDA and Adjusted EBITDA are presented to provide additional information with respect to the ability of Navios Holdings to satisfy its respective obligations, including debt service, capital expenditures, working capital requirements and pay dividends. While EBITDA and Adjusted EBITDA are frequently used as measures of operating results and the ability to meet debt service requirements, the definitions of EBITDA and Adjusted EBITDA used here may not be comparable to those used by other companies due to differences in methods of calculation.

EBITDA and Adjusted EBITDA have limitations as an analytical tool, and therefore, should not be considered in isolation or as a substitute for the analysis of Navios Holdings’ results as reported under U.S. GAAP. Some of these limitations are: (i) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, working capital needs; (ii) EBITDA and Adjusted EBITDA do not reflect the amounts necessary to service interest or principal payments on our debt and other financing arrangements; and (iii) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future. EBITDA and Adjusted EBITDA do not reflect any cash requirements for such capital expenditures. Because of these limitations, among others, EBITDA and Adjusted EBITDA should not be considered as a principal indicator of Navios Holdings’ performance. Furthermore, our calculation of EBITDA and Adjusted EBITDA may not be comparable to that reported by other companies due to differences in methods of calculation.

Navios Logistics EBITDA is used to measure its operating performance.

The following tables provide a reconciliation of EBITDA and Adjusted EBITDA of Navios Holdings (including Navios Logistics) and EBITDA of Navios Logistics on a stand-alone basis:

Navios Holdings Reconciliation of EBITDA and Adjusted EBITDA to Cash from Operations

  December 31,   December 31,
Three Months Ended 2017   2016
(in thousands of U.S. dollars) (unaudited)    (unaudited)
           
Net cash provided by/ (used in) operating activities $ 14,370      $ (5,357 )
Net increase in operating assets   8,738         576  
Net increase in operating liabilities   (8,711 )       (2,391 )
Net interest cost   30,968         27,435  
Deferred finance charges   (2,097 )       (1,599 )
Provision for losses on accounts receivable   (545 )       (702 )
Equity in affiliates, net of dividends received   1,954         5,361  
Payments for drydock and special survey costs   800         3,721  
Noncontrolling interest   59         2,057  
Other loss on sale of assets   (11 )      —  
(Loss)/ gain on bond and debt extinguishment   (1,530 )       13,231  
Impairment loss on investments in affiliates         (228,026 )
Other impairment losses   (36,326 )      
EBITDA $ 7,669      $   (185,694 )
Loss/ (gain) on bond and debt extinguishment   2,695         (13,231 )
Impairment loss on investments in affiliates         228,026  
Other impairment losses   36,326        
Adjusted EBITDA $ 46,690      $   29,101  

Three Month Period Ended
(in thousands of U.S. dollars)
December 31,
2017
  December 31,
2016
  (unaudited)   (unaudited)
Net cash provided by/ (used in) operating activities 14,370     $ (5,357 )
Net cash used in investing activities $ (9,378 )   $   (21,156 )
Net cash provided by financing activities $ 8,442     $   3,950  

Navios Logistics EBITDA Reconciliation to Net Loss

  December 31,   December 31,
Three Months Ended 2017   2016
(in thousands of U.S. dollars) (unaudited)   (unaudited)
           
Net loss $ (162 )   $ (5,685 )
Depreciation and amortization   7,241       5,887  
Amortization of deferred drydock and special survey costs   2,054       1,804  
Interest expense and finance cost, net   8,587       5,754  
Income tax benefit   (2,705 )     (641 )
EBITDA $ 15,015     $ 7,119  

Navios Holdings Reconciliation of EBITDA and Adjusted EBITDA to Cash from Operations

  December 31,    December 31,
Year Ended 2017   2016
(in thousands of U.S. dollars) (unaudited)    (unaudited)
           
Net cash provided by operating activities $ 50,784      $   36,920  
Net (decrease)/increase in operating assets   (25,052 )       20,599  
Net increase in operating liabilities   (20,814 )       (38,928 )
Net interest cost   114,780         108,692  
Deferred finance charges   (6,391 )       (5,653 )
Provision for losses on accounts receivable   (269 )       (1,304 )
Equity in affiliates, net of dividends received   (4,610 )       8,609  
Payments for drydock and special survey costs   10,824         11,096  
Noncontrolling interest   (1,123 )       (3,674 )
Other gain on sale of assets   1,064        —  
Gain on bond and debt extinguishment   185         29,187  
Impairment loss on investments in affiliates         (228,026 )
Other impairment losses   (50,565 )      —  
Loss on sale and reclassification to earnings of available for sale securities           (345 )
EBITDA $ 68,813      $   (62,827 )
Loss/(gain) on bond and debt extinguishment   2,695         (29,187 )
Impairment loss on investments in affiliates         228,026  
Other impairment losses   50,565        —  
Other items from affiliates   4,679         8,032  
Compensation from early redelivery of a vessel from its charterer           (14,871 )
Adjusted EBITDA $ 126,752      $   129,173  

Year Ended December 31,
2017
  December 31,
2016
(in thousands of U.S. dollars) (unaudited)   (unaudited)
       
Net cash provided by operating activities 50,784     $   36,920  
Net cash used in investing activities $ (42,365 )   $  (150,565 )
Net cash (used in)/ provided by financing activities $ (16,779 )   $   86,225  

Navios Logistics EBITDA Reconciliation to Net Income

  December 31,   December 31,
Year Ended 2017   2016
(in thousands of U.S. dollars) (unaudited)   (unaudited)
Net income $ 3,105     $ 10,157
Depreciation and amortization   26,865       26,628
Amortization of deferred drydock and special survey costs   7,928       6,870
Interest expense and finance cost, net   28,109       23,425
Income tax (benefit)/expense   (3,468 )     982
EBITDA $ 62,539     $ 68,062

EXHIBIT II

Owned Vessels

               
Vessel Name   Vessel Type   Year Built   Deadweight
(in metric tons)
Navios Serenity   Handysize   2011   34,690
Navios Herakles   Ultra Handymax   2001   52,061
Navios Achilles   Ultra Handymax   2001   52,063
Navios Vector   Ultra Handymax   2002   50,296
Navios Meridian   Ultra Handymax   2002   50,316
Navios Mercator   Ultra Handymax   2002   53,553
Navios Arc   Ultra Handymax   2003   53,514
Navios Hios   Ultra Handymax   2003   55,180
Navios Kypros   Ultra Handymax   2003   55,222
Navios Astra   Ultra Handymax   2006   53,468
Navios Ulysses   Ultra Handymax   2007   55,728
Navios Celestial   Ultra Handymax   2009   58,063
Navios Vega   Ultra Handymax   2009   58,792
Navios Magellan   Panamax   2000   74,333
Navios Star   Panamax   2002   76,662
Navios Amitie   Panamax   2005   75,395
Navios Northern Star   Panamax   2005   75,395
Navios Taurus   Panamax   2005   76,596
Navios Asteriks   Panamax   2005   76,801
Navios Galileo   Panamax   2006   76,596
N Amalthia   Panamax   2006   75,318
N Bonanza   Panamax   2006   76,596
Navios Avior   Panamax   2012   81,355
Navios Centaurus   Panamax   2012   81,472
Navios Sphera   Panamax   2016   84,872
Navios Equator Prosper   Capesize   2000   171,191
Navios Stellar   Capesize   2009   169,001
Navios Bonavis   Capesize   2009   180,022
Navios Happiness   Capesize   2009   180,022
Navios Phoenix   Capesize   2009   180,242
Navios Lumen   Capesize   2009   180,661
Navios Antares   Capesize   2010   169,059
Navios Etoile   Capesize   2010   179,234
Navios Bonheur   Capesize   2010   179,259
Navios Altamira   Capesize   2011   179,165
Navios Azimuth   Capesize   2011   179,169
Navios Ray   Capesize   2012   179,515
Navios Gem   Capesize   2014   181,336
Navios Mars   Capesize   2016   181,259
               

Long term Chartered-in Fleet in Operation 

Vessel Name   Vessel Type   Year
Built
  Deadweight
(in metric tons)
  Purchase
Option(1)
 
Navios Lyra   Handysize   2012   34,718   Yes (2)  
Navios Primavera   Ultra Handymax   2007   53,464   Yes  
Mercury Ocean   Ultra Handymax   2008   53,452   No  
Kouju Lily   Ultra Handymax   2011   58,872   No  
Navios Oriana   Ultra Handymax   2012   61,442   Yes  
Navios Mercury   Ultra Handymax   2013   61,393   Yes  
Navios Venus   Ultra Handymax   2015   61,339   Yes  
Osmarine   Panamax   2006   76,000   No  
Navios Aldebaran   Panamax   2008   76,500   Yes  
KM Imabari   Panamax   2009   76,619   No  
Navios Marco Polo   Panamax   2011   80,647   Yes  
Navios Southern Star   Panamax   2013   82,224   Yes  
Sea Victory   Panamax   2014   77,095   Yes  
Navios Sky   Panamax   2015   82,056   Yes  
Navios Amber   Panamax   2015   80,994   Yes  
Elsa S   Panamax   2015   80,954   No  
Navios Coral   Panamax   2016   84,904   Yes  
Navios Dolphin   Panamax   2017   81,630   Yes  
Navios Citrine   Panamax   2017   81,626   Yes  
Pacific Explorer   Capesize   2007   177,000   No  
King Ore   Capesize   2010   176,800   Yes  
Navios Koyo   Capesize   2011   181,415   Yes  
Navios Obeliks   Capesize   2012   181,415   Yes  
Dream Coral   Capesize   2015   181,249   Yes  
Dream Canary   Capesize   2015   180,528   Yes  
Navios Felix   Capesize   2016   181,221   Yes  

Long term Chartered-in Fleet to be delivered

Vessel Name   Vessel Type   Delivery date   Deadweight
(in metric tons)
  Purchase
Option(1)
 
TBN   Panamax   March 2018   82,000   No  
TBN   Panamax   May 2018   82,000   No  
TBN   Panamax   Q4 2018   81,500   No(3)  
TBN   Panamax   Q1 2019   81,500   No(3)  

Long term Bareboat Chartered-in Fleet to be delivered

Vessel Name   Vessel Type   Delivery date   Deadweight
(in metric tons)
  Purchase
Option(1)
TBN   Panamax   Q4 2019   82,000   Yes
TBN   Panamax   Q1 2020   82,000   Yes
TBN   Panamax   Q4 2019   82,000   Yes

(1 ) Generally, Navios Holdings may exercise its purchase option after three to five years of service.
(2 ) Navios Holdings holds the initial 50% purchase option on the vessel.
(3 ) Navios Holdings has the right of first refusal and profit share on sale of vessel.