Navios upbeat despite growing losses in Q1

According to Angeliki Frangou, chairman and CEO of the Piraeus-based ocean carrier, thanks to a recovering market, Navios is “positioned to enjoy substantial free cash flow from an increase in charter rates.”    Navios Maritime Holdings Inc. had a net loss of $48.7 million in the first quarter of 2017 compared with a loss of $7.5 million in the same 2016 period. The company had revenue of $95.3 million in the first quarter of 2017 compared with revenue of $101.5 million in the first quarter of 2016.
   Angeliki Frangou, chairman and chief executive officer, said she was “pleased with our results for the first quarter” of 2017 in which adjusted EBITDA was $17.5 million compared with $30.6 million in the first quarter of 2016.
   She said the company had “net cash from operating activities of $28.6 million. We also ended the quarter with $138.2 million in cash, while having no committed growth capex or any significant debt maturities until 2019. In a recovering market, we are positioned to enjoy substantial free cash flow from an increase in charter rates.”
   Navios Maritime Holdings is a focused on transshipment of dry bulk commodities such as iron ore, coal and grain and is a diversified company that directly controls 66 modern dry bulk vessels and manages almost 200 vessels in its broader fleet. It is a general partner in Navios Maritime Partners, a publicly-traded master limited partner partnership which owns and operates container and dry bulk vessels.
   In the first quarter Navios Maritime Holdings entered into an agreement to acquire the 14-ship fleet of Rickmers Maritime Trust (RMT) and has formed a new company, Navios Maritime Containers Inc., for that purpose.
   Navios Partners will invest $30 million and receive 40 percent of the equity, and Navios Holdings will invest $5 million and receive 6.7% of the equity of Navios Containers.
   Other Navios companies include: Navios Acquisition Corp. which owns and operates petroleum products and chemical tankers, and Navios Maritime Midstream Partners L.P. which owns and oerates crude oil tankers, and Navios South American Logistics, which owns and operates vessels and terminal in the Hidrovia region river system in South America and in the cabotage trades on the east coast of South America.
   Frangou said the company’s fleet size “provides purchasing power and cost savings opportunities. Our operating leverage allows our costs to be substantially below the average of the listed peers, savings that accrue directly to our stakeholders. The strength of Navios Holdings’ sponsorship allowed Navios Partners to grow significantly by raising $100 million in the first quarter and entering into an agreement to acquire the RMT fleet. In addition, it allowed Navios Containers to raise $75 million of gross equity proceeds in its initial capitalization.”
   She also noted that Navios Holdings also agreed to acquire control of the FSL Trust, a Singapore-based business trust that owns 22 vessels (five containerships and 17 tankers), subject to various conditions.