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Navios Maritime Midstream Partners L.P. Reports Financial Results for the Fourth Quarter and Year Ended December 31, 2015

  • Net Income: $9.1 million in Q4; $27.1 million for FY
  • Earnings per Common Unit: $0.44 in Q4; $1.33 for FY
  • EBITDA: $19.4 million in Q4; $62.2 million for FY
  • Operating Surplus: $12.9 million in Q4; $42.4 million for FY
  • Profit sharing: $3.5 million in Q4; $8.0 million for FY
  • Quarterly Cash Distribution of $0.4225 per unit; $1.69 per unit annualized
  • 1.48x Total Unit Distribution Coverage for the quarter

MONACO, Jan. 27, 2016 (GLOBE NEWSWIRE) -- Navios Maritime Midstream Partners L.P. (“Navios Midstream”) (NYSE:NAP), an owner and operator of tanker vessels, reported its financial results today for the fourth quarter and year ended December 31, 2015.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Midstream stated “We are pleased to report net income of $27.1 million, or $1.33 per share, for 2015. Consequently, we announced a quarterly distribution of $0.4225 per unit, to shareholders of record on February 9, 2016. Our distribution coverage ratio is a healthy 1.48x for the quarter.”

Angeliki Frangou continued, “The collapse of oil prices has introduced significant volatility into the general climate. This price decline, generally good for transportation, has far reaching implications that has adversely affected the investment climate. Yet, Navios Midstream is a solid company and has neither any forward growth capex required nor any debt maturity until 2020. Navios Midstream has 100% of its fleet fixed for 2016 and 2017, with upside through profit sharing, which generated $0.39 net income per unit.”

RECENT DEVELOPMENTS

Quarterly Cash Distribution

The Board of Directors of Navios Midstream declared a cash distribution for the fourth quarter of 2015 of $0.4225 per unit. The cash distribution is payable on February 12, 2016 to unitholders of record as of February 9, 2016.

Profit Share

During the fourth quarter of 2015, Navios Midstream benefited from the VLCC spot market and recognized $3.5 million from its profit sharing arrangements. Profit share recognized for the year ended December 31, 2015, was $8.0 million.

Long – Term Cash Flow

Navios Midstream has entered into long-term charter-out agreements for its vessels, with a remaining average term of 5.3 years, which are expected to provide a stable base of revenue and distributable cash flow. Navios Midstream has currently contracted out 100% of its available days for 2016 and 2017, expecting to generate revenues of approximately $89.6 million and $86.6 million, respectively. The average expected daily charter-out rate for the fleet is $40,798 and $39,559 for 2016 and 2017, respectively.

EARNINGS HIGHLIGHTS

For the following results and the selected financial data presented herein, Navios Midstream has compiled consolidated statement of operations for the three months and years ended December 31, 2015 and 2014. The quarterly information for 2015 and 2014 was derived from the unaudited condensed consolidated financial statements for the respective periods. EBITDA and Operating Surplus are non-GAAP financial measures and should not be used in isolation or substitution for Navios Midstream’s results.

(in $‘000 except per unit data)Three Month
Period ended
December 31, 2015
(unaudited)
Three Month
Period ended
December 31, 2014
(unaudited) (1)
Year ended
December 31, 2015
(unaudited)
Year ended
December 31, 2014
(unaudited) (1)
Revenue$25,836 $16,008 $83,362 $63,534
Net income 9,134 2,607 27,072 1,164
Adjusted net income(2) 9,134 2,607 28,757 1,164
EBITDA 19,381 11,903 62,190 47,429
Earnings per common unit (basic and diluted) 0.44 0.13 1.33 0.13
Adjusted earnings per common unit (basic and diluted)(2) 0.44 0.13 1.42 0.13
Operating Surplus 12,946 N/A(1) 42,406 N/A(1)
Maintenance and replacement capital expenditure reserve 3,591 N/A(1) 11,684 N/A(1)
(1) Prior to the Navios Midstream’s IPO in November 2014, Navios Midstream’s four VLCC fleet was part of Navios Maritime Acquisition Corporation’s fleet. All figures prior to the IPO are not directly comparable to periods after the IPO.
(2) Net income and Earnings per common unit (basic and diluted) for the year ended December 31, 2015 have been adjusted to exclude the amount of $1,685 representing a write-off of deferred finance cost associated with debt prepayment.

Three month periods ended December 31, 2015 and 2014

Revenue for the three month period ended December 31, 2015 increased by $9.8 million to $25.8 million, as compared to $16.0 million for the same period in 2014. Time Charter Equivalent (“TCE”) was $45,940 for the three month period ended December 31, 2015 and $43,005 for the three month period ended December 31, 2014. The increase was due to the acquisition of the Nave Celeste and the C. Dream in June 2015 and due to profit sharing of $3.5 million recognized in the three month period ended December 31, 2015 in relation to certain charters.

EBITDA increased by $7.5 million to $19.4 million for the three month period ended December 31, 2015, as compared to $11.9 million for the same period in 2014. The increase in EBITDA was due to a $9.8 million increase in revenue. The above increase was partially mitigated by a: (a) $1.7 million increase in management fees; (b) $0.3 million increase in time charter expenses; (c) $0.2 million increase in general and administrative expenses; and (d) $0.1 million decrease in other income.

The reserve for estimated maintenance and replacement capital expenditures for the three month period ended December 31, 2015 was $3.6 million (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Navios Midstream generated an Operating Surplus for the three month period ended December 31, 2015 of $12.9 million. Operating Surplus is a non-GAAP financial measure used by certain investors to assist in evaluating a partnership’s ability to make quarterly cash distributions (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Net income for the three month period ended December 31, 2015 was $9.1 million compared to $2.6 million for the three month period ended December 31, 2014. The increase in net income was due to a: (i) $7.5 million increase in EBITDA; and (ii) $0.9 million decrease in interest expense and finance cost; partially mitigated by a: (a) $1.5 million increase in depreciation and amortization; and (b) $0.4 million increase in direct vessel expenses.

Earnings per common unit for the three month period ended December 31, 2015 was $0.44.

Year ended December 31, 2015 and 2014
Revenue for the year ended December 31, 2015 increased by $19.8 million to $83.4 million, as compared to $63.5 million for the same period in 2014. Time Charter Equivalent (“TCE”) was $45,924 for year ended December 31, 2015 and $42,995 for year ended December 31, 2014. The increase was due to the acquisition of the Nave Celeste and the C. Dream in June 2015 and due to profit sharing of $8.0 million recognized in the year ended December 31, 2015 in relation to certain charters.

EBITDA increased by $14.8 million to $62.2 million for the year ended December 31, 2015, as compared to $47.4 million for the same period in 2014. The increase in EBITDA was due to a $19.8 million increase in revenue. The above increase was partially mitigated by a: (a) $3.4 million increase in management fees; (b) $1.2 million increase in general and administrative expenses; (c) $0.3 million increase in time charter expenses; and (d) $0.1 million decrease in other income.

The reserve for estimated maintenance and replacement capital expenditures for the year ended December 31, 2015 was $11.7 million (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Navios Midstream generated an Operating Surplus for the year ended December 31, 2015 of $42.4 million. Operating Surplus is a non-GAAP financial measure used by certain investors to assist in evaluating a partnership’s ability to make quarterly cash distributions (please see Reconciliation of Non-GAAP Financial Measures in Exhibit 3).

Net income for the year ended December 31, 2015 was negatively affected by a $1.7 million write-off of deferred finance cost in association with debt prepayment. Excluding that write-off, Adjusted net income for the year ended December 31, 2015 was $28.8 million compared to $1.2 million for the year ended December 31, 2014. The increase in net income was due to a: (i) $14.8 million increase in EBITDA; and (ii) $16.3 million decrease in interest expense and finance cost; partially mitigated by a: (a) $3.2 million increase in depreciation and amortization; and (b) $0.3 million increase in direct vessel expenses.

Earnings per common unit for the year ended December 31, 2015 was $1.33.

Fleet Employment Profile

The following table reflects certain key indicators of Navios Midstream’s core fleet performance for the three months and years ended December 31, 2015 and 2014

Three Month
Period ended
December 31, 2015
(unaudited)
Three Month
Period ended
December 31, 2014
(unaudited)


Year ended
December 31, 2015
(unaudited)
Year ended
December 31, 2014
(unaudited)
FLEET DATA
Available days(1) 552 368 1,791 1,460
Operating days(2) 547 367 1,785 1,457
Fleet utilization(3) 99.1% 99.8% 99.7% 99.8%
Vessels operating at period end 6 4 6 4
AVERAGE DAILY RESULTS
Time Charter Equivalent per day(4) $45,940 $43,005 $45,924 $42,995
(1) Available days for the fleet represent total calendar days the vessels were in Navios Midstream’s possession for the relevant period after subtracting off-hire days associated with scheduled repairs, dry dockings or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which a vessel is capable of generating revenues.
(2) Operating days is 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 Midstream’s vessels were available for revenue generating available days, 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 efficiency in finding employment for vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs, drydockings or special surveys.
(4) Time Charter Equivalent (“TCE”) rates: TCE rates are defined as voyage and time charter revenues less voyage expenses during a period divided by the number of available days during the period. The TCE rate is a standard shipping industry performance measure used primarily to present the actual daily earnings generated by vessels on various types of charter contracts for the number of available days of the fleet.

Conference Call details:

Navios Midstream's management will host a conference call today, Wednesday, January 27, 2016 to discuss the results for the fourth quarter and year ended December 31, 2015.

Conference Call details:

Call Date/Time: Wednesday, January 27, 2016 at 08:30 am ET
Call Title: Navios Midstream Q4 2015 Financial Results Conference Call
US Dial In: +1.866.703.4207
International Dial In: +1.636.692.6440
Conference ID: 2743 6001

The conference call replay will be available two hours 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: 2743 6001

Slides and audio webcast:
There will also be a live webcast of the conference call, through the Navios Midstream’s website (www.navios-midstream.com) under “Investors”. Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

A supplemental slide presentation will be available on the Navios Midstream’s website under the "Investors" section by 8:00 am ET on the day of the call.

About Navios Maritime Midstream Partners L.P.

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

Forward-Looking Statements

This press release contains 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 and expectations, including with respect to Navios Midstream’s future dividends and Navios Midstream's 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 Midstream at the time this report was made. Although Navios Midstream 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 Midstream. 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, the creditworthiness of our charterers and the ability of our contract counterparties to fulfill their obligations to us, tanker industry trends, including charter rates and vessel values and factors affecting vessel supply and demand, the aging of our vessels and resultant increases in operation and drydocking costs, the loss of any customer or charter or vessel, our ability to repay outstanding indebtedness, to obtain additional financing and to obtain replacement charters for our vessels, in each case, at commercially acceptable rates or at all, 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, potential liability from litigation and our vessel operations, including discharge of pollutants, general domestic and international political conditions, competitive factors in the market in which Navios Midstream operates; risks associated with operations outside the United States; and other factors listed from time to time in the Navios Midstream's filings with the Securities and Exchange Commission. Navios Midstream 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 Midstream's expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. Navios Midstream makes no prediction or statement about the performance of its common units.

EXHIBIT 1


NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND COMBINED BALANCE SHEETS
(Expressed in thousands of U.S. Dollars)
December 31,
2015
December 31,
2014
ASSETS
Current assets
Cash and cash equivalents $37,834 $30,877
Accounts receivable, net 5,110 653
Prepaid expenses and other current assets 112 212
Due from related parties 2,804
Total current assets 45,860 31,742
Vessels, net 400,192 320,229
Intangible assets 28,450 31,736
Deferred dry dock and special survey costs, net 6,066 1,955
Total non-current assets 434,708 353,920
Total assets $480,568 $385,662
LIABILITIES AND PARTNERS’ CAPITAL
Current liabilities
Accounts payable $412 $1,243
Accrued expenses 654 4,174
Due to related parties 438 736
Deferred revenue 1,931 1,938
Current portion of long-term debt, net of deferred finance costs and discount 643 10,022
Total current liabilities 4,078 18,113
Long-term debt 197,176 114,065
Total non-current liabilities 197,176 114,065
Total liabilities $201,254 $132,178
Commitments and contingencies
Owner’s net investment
Total Partners’ capital
Common Unitholders (9,342,692 units issued and outstanding at December 31, 2015 and December 31, 2014) 126,317 127,350
Subordinated Series A Unitholders (1,592,920 units issued and outstanding at December 31, 2015 and none at December 31, 2014) 27,379
Subordinated Unitholders (9,342,692 units issued and outstanding at December 31, 2015 and December 31, 2014) 120,154 121,187
General Partner (413,843 units issued and outstanding at December 31, 2015 and 381,334 issued and outstanding at December 31, 2014) 5,464 4,947
Partners’ capital 279,314 253,484
Total liabilities, Partners’ capital and owner’s net investment $480,568 $385,662


NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS
(Expressed in thousands of U.S. Dollars, except per unit amounts)
Three Month
Period ended
December 31, 2015
($ ‘000)
(unaudited)
Three Month
Period ended
December 31, 2014
($ ‘000)
(unaudited)
Year ended
December 31, 2015
($ ‘000)
(unaudited)
Year ended
December 31, 2014
($ ‘000)
(unaudited)
Revenue $25,836 $16,008 $83,362 $63,534
Time charter expenses (476) (183) (1,100) (762)
Direct vessel expenses (651) (289) (1,602) (1,283)
Management fees (entirely through related party transactions) (5,244) (3,496) (17,613) (14,166)
General and administrative expenses (707) (540) (2,497) (1,296)
Depreciation and amortization (6,367) (4,877) (22,686) (19,509)
Interest expenses and finance cost (3,229) (4,130) (10,830) (25,473)
Other income, net 12 119 88 119
Other expense (40) (5) (50)
Net income $9,134 $2,607 $27,072 $1,164
Net income $9,134 2,607 $27,072 1,164
Earnings per unit (basic and diluted)
Common unitholders: $0.44 0.13 $1.33 0.13
Subordinated Series A unitholders: $0.44 $1.86
Subordinated unitholders: $0.44 0.13 $1.33 0.13




NAVIOS MARITIME MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS
(Expressed in thousands of U.S. Dollars)
Year ended
December 31,
2015
Year ended
December 31,
2014
Operating Activities
Net income $27,072 $1,164
Adjustments to reconcile net income/ (loss) to net cash provided by/ (used in) operating activities:
Depreciation and amortization 22,686 19,509
Amortization of deferred finance fees and bond premium 2,676 712
Non-cash loss on extinguishment of 2017 Notes
Amortization of dry dock and special survey costs 1,602 1,283
Changes in operating assets and liabilities:
Decrease/ (increase) in prepaid expenses and other current assets 100 7
Payment for Drydocking (5,713)
(Increase)/ Decrease in accounts receivable (4,457) 164
(Decrease)/ Increase in accounts payable (310) 351
(Decrease)/ Increase in accrued expenses (1,040) 1,479
(Decrease)/ increase in due to/ from related parties (2,756) 2,592
Decrease in deferred revenue (7)
Net cash provided by/ (used in) operating activities $39,853 $27,261
Investing Activities
Acquisition of vessels (72,252)
Increase in due from related parties (52,314)
Net cash used in investing activities $(72,252) $(52,314)
Financing Activities
Proceeds from Long term debt, net of deferred finance costs and discount 198,081 124,027
Loan repayment (127,025)
Cash remittance to Navios Acquisition (214,854)
IPO proceeds, net of underwriting discount 113,906
IPO expenses (3,347) (469)
Dividend paid (28,904)
Proceeds from issuance of general partner units 551
Owner’s net investment 24,168
Net cash provided by financing activities $39,356 $46,778
Net increase in cash and cash equivalents 6,957 21,725
Cash and cash equivalents, beginning of year 30,877 9,152
Cash and cash equivalents, end of year $37,834 $30,877
Supplemental disclosures of cash flow information
Cash interest paid $8,100 $27,786
Non-cash financing activities
Non-cash contributions by owners $ $
Accrued IPO expenses $ $3,290
Assets and liabilities retained by Navios Acquisition:
Long-term debt $ 341,034
Due from related parties $ (88,070)
Due to related parties $ 2,588
Deferred financing costs $ (7,405)

EXHIBIT 2

Owned Vessels Type Built Capacity
(DWT)
Shinyo Kieran VLCC 2011 297,066
Shinyo Saowalak VLCC 2010 298,000
Nave Celeste VLCC 2003 298,717
Shinyo Kannika VLCC 2001 287,175
Shinyo Ocean VLCC 2001 281,395
C. Dream VLCC 2000 298,570


Option Vessels(1) Type Built Capacity
(DWT)
Nave Buena Suerte VLCC 2011 297,491
Nave Quasar VLCC 2010 297,376
Nave Galactic VLCC 2009 297,168
Nave Neutrino VLCC 2003 298,287
Nave Electron VLCC 2002 305,178

(1) Navios Midstream has options, exercisable through November 18, 2016, to acquire up to five VLCCs at fair market value from Navios Maritime Acquisition Corporation.

EXHIBIT 3

Disclosure of Non-GAAP Financial Measures

1. EBITDA

EBITDA represents net income plus interest and finance costs plus depreciation and amortization and income taxes.

EBITDA is presented because Navios Midstream believes that EBITDA is a basis upon which liquidity can be assessed and present useful information to investors regarding Navios Midstream’s ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. EBITDA is a “non-GAAP financial measure” and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

While EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.

2. Operating Surplus

Operating Surplus represents net income adjusted for depreciation and amortization expense, non-cash interest expense and estimated maintenance and replacement capital expenditures. Maintenance and replacement capital expenditures are those capital expenditures required to maintain over the long term the operating capacity of, or the revenue generated by, Navios Midstream’s capital assets.

Operating Surplus is a quantitative measure used in the publicly-traded partnership investment community to assist in evaluating a partnership’s ability to make quarterly cash distributions. Operating Surplus is not required by accounting principles generally accepted in the United States and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

3. Available Cash

Available Cash generally means for each fiscal quarter, all cash on hand at the end of the quarter:

  • less the amount of cash reserves established by the Board of Directors to:

  • provide for the proper conduct of Navios Midstream’s business (including reserve for maintenance and replacement capital expenditures);

  • comply with applicable law, any of Navios Midstream’s debt instruments, or other agreements; or

  • provide funds for distributions to the unitholders and to the general partner for any one or more of the next four quarters;

  • plus all cash on hand on the date of determination of available cash for the quarter resulting from working capital borrowings made after the end of the quarter. Working capital borrowings are generally borrowings that are made under any revolving credit or similar agreement used solely for working capital purposes or to pay distributions to partners.

Available Cash is a quantitative measure used in the publicly-traded partnership investment community to assist in evaluating a partnership’s ability to make quarterly cash distributions. Available cash is not required by accounting principles generally accepted in the United States and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity.

4. Reconciliation of Non-GAAP Financial Measures

Three Month
Period ended
December 31, 2015
($ ‘000)
(unaudited)
Three Month
Period ended
December 31, 2014
($ ‘000)
(unaudited)
Year ended
December 31, 2015
($ ‘000)
(unaudited)
Year ended
December 31, 2014
($ ‘000)
(unaudited)
Net cash provided by operating activities $15,743 $12,232 $39,853 $27,261
Net increase/(decrease) in operating assets (117) (109) 10,070 (171)
Net (increase)/ decrease in operating liabilities 881 (4,192) 4,113 (4,422)
Net interest cost 3,229 4,130 10,830 25,473
Amortization of deferred finance cost and bond premium (355) (158) (2,676) (712)
EBITDA $19,381 $11,903 $62,190 $47,429
Net cash provided by operating activities $15,743 $12,232 $39,853 $27,261
Net cash used in investing activities $ $(13,408) $(72,252) $(52,314)
Net cash (used in) / provided by financing activities $(9,254) $25,996 $39,356 $46,778


Three Month
Period ended
December 31, 2015
($ ‘000)
(unaudited)
Year ended
December 31, 2015
($ ‘000)
(unaudited)
EBITDA $19,381 $62,190
Cash interest paid (2,844) (8,100)
Maintenance and replacement capital expenditures (3,591) (11,684)
Operating Surplus $12,946 $42,406
Cash distribution paid relating to the first nine months (25,143)
Cash reserves (4,204) (8,521)
Available cash for distribution $8,742 $8,742


Investor Relations Contacts Navios Maritime Midstream Partners L.P. +1 (212) 906 8647 Investors@navios-midstream.com

Source:Navios Maritime Midstream Partners LP