Navios Maritime Holdings Inc. Reports Financial Results for the First Quarter Ended March 31, 2010

PIRAEUS, Greece, May 27 /PRNewswire-FirstCall/ -- Navios Maritime Holdings Inc. ("Navios Holdings") (NYSE: NM), a global, vertically integrated seaborne shipping and logistics company, today reported financial results for the first quarter ended March 31, 2010.

Angeliki Frangou, Chairman and CEO of Navios Holdings stated, "I am pleased with our performance thus far in 2010. During a period of continued uncertainty, Navios Holdings created liquidity from the sale of three vessels and used the sale proceeds to increase its cash reserves and deleverage. At the same time, Navios Holdings' stable business allowed the board to declare a dividend in respect of Q1 2010 of $0.06 per share."

Ms. Frangou continued, "We were pleased to announce that Navios Acquisition's shareholders approved the acquisition of a fleet of 13 product and chemical tankers. We believe that, in the long term, this acquisition will create significant value; our review of the industry led us to believe that Navios Acquisition is purchasing the fleet toward the low end of the cycle in a recovering and growing industry. As a result of our team's hard work in a difficult market, Navios Holdings ownership interest has a value well in excess of its aggregate cost."  

2010 HIGHLIGHTS - RECENT DEVELOPMENTS

Navios Maritime Acquisition Corporation  

On April 8, 2010, pursuant to the terms and conditions of the Acquisition Agreement by and between Navios Maritime Acquisition Corporation ("Navios Acquisition") (NYSE: NNA) and Navios Holdings, Navios Acquisition will acquire 13 vessels (11 product tankers and two chemical tankers) plus options to purchase two additional product tankers, for an aggregate purchase price of $457.7 million, of which $334.3 million will be financed with debt and the remaining $123.4 million with existing cash. Each vessel will be commercially and technically managed under a management agreement with a subsidiary of Navios Holdings.

On May 25, 2010, Navios Acquisition announced that at a special meeting of stockholders, Navios Acquisition's stockholders approved (a) the acquisition of 13 vessels (11 product tankers and two chemical tankers) plus options to purchase two additional product tankers, for an aggregate purchase price of $457.7 million, of which $123.4 million will be from existing cash and the $334.3 million balance from debt financing, pursuant to the terms and conditions of the Acquisition Agreement by and between Navios Acquisition and Navios Holdings and (b) certain amendments to Navios Acquisition's amended and restated articles of incorporation.

Following the consummation of the transactions described in the Acquisition Agreement, Navios Holdings will be released from all debt and equity commitments for the above vessels and Navios Acquisition will reimburse Navios Holdings for the $38.8 million equity payments made prior to the stockholders meeting under the purchase contracts for the vessels plus all associated payments previously made by Navios Holdings.

Navios Holdings' Core Fleet Highlights

Vessel Sales

During 2010, Navios Holdings received approximately $283.0 million ($263.0 million in cash and $20.0 million in common units) from the sale of three vessels to Navios Maritime Partners L.P. ("Navios Partners").  These transactions allowed Navios Holdings to monetize certain tangible and intangible assets while keeping a residual interest in the vessels through its ownership interest in Navios Partners. The vessels sold were the following:

• Navios Pollux, Capesize vessel, sold on May 21, 2010 for $110.0 million in cash.
• Navios Aurora II, Capesize vessel, sold on March 18, 2010 for $90.0 million in cash and 1,174,219 common units of Navios Partners.
• Navios Hyperion, Panamax vessel, sold on January 8, 2010 for $63.0 million in cash.

Agreement to Acquire New Capesize Vessel

In April 2010, Navios Holdings agreed to acquire a new build 180,000 dwt Capesize vessel for a price of $54.0 million. The vessel is under construction with a South Korean Shipyard and scheduled for delivery in January 2011. The vessel has been chartered out for ten years charter to a quality counter party for $24,674 (net) daily rate. It is anticipated that this charter will generate annual EBITDA of $7.1 million and cumulative EBITDA of $69.7 million (cumulative EBITDA over the life of the contract; daily operating expenses of $5,000 per day, growing at 3% annually).

Delivery of Navios Vector

On April 28, 2010, the Navios Vector, a 50,296 dwt Ultra-Handymax vessel and former long-term chartered-in vessel in operation, was delivered to Navios Holdings' owned fleet. Navios Vector acquisition cost was approximately $30.0 million and was partially financed through a $18.0 million facility and the remaining balance through existing cash.  

Liquidity

Net Debt to Total Capitalization was 48.5% on March 31, 2010. Navios Holdings' total available liquidity, including bank lines, at March 31, 2010 was approximately $376.4 million.  Navios Holdings has no unfunded capital expenditures for 2010.  In addition, its debt maturities are anticipated less than $43.2 million and $89.5 million for 2010 and 2011, respectively.

Time Charter Coverage

Navios Holdings has extended its long-term fleet employment by entering into agreements to charter-out vessels for periods ranging from one to 12 years. As of May 26, 2010, Navios Holdings had contracted 96.0%, 69.7%, 56.4% and 46.8% of its available days on a charter-out basis for 2010, 2011, 2012 and 2013, respectively, equivalent to $299.4 million, $292.5 million, $265.0 million and $225.3 million in revenue, respectively. The average contractual daily charter-out rate for the core fleet is $27,222, $31,230, $32,876 and $33,551 for 2010, 2011, 2012 and 2013, respectively. The average daily charter-in rate for the active long-term charter-in vessels for 2010 is $10,095.

The above figures do not include vessels servicing the Contracts of Affreightment ("COA") and Logistics businesses.

Fleet Profile

Navios Holdings controls a fleet of 59 vessels totaling 6.4 million dwt, of which 32 are owned and 27 are chartered-in under long-term charters. Navios Holdings currently operates 42 vessels (13 Capesize, 12 Panamax, 16 Ultra-Handymax and one Handysize product tanker vessel) totaling 4.1 million dwt and has scheduled 17 newbuildings to be delivered. These vessels are expected to be delivered at various dates through 2013. The average age of the operating fleet is 4.9 years.

Exhibit II displays the "Core Fleet" profile of Navios Holdings.

Navios Partners Highlights

On May 12, 2010, Navios Holdings received $5.4 million, representing the cash distribution from Navios Partners for the first quarter of 2010.

On May 5, 2010, Navios Partners announced the completion of its follow-on public offering of 5,175,000 common units, which included the full exercise of the underwriters over-allotment option, at $17.84 per unit, raising gross proceeds of approximately $92.3 million.

Financial Highlights

• EBITDA increased by 84.2% to $78.1 million in the first quarter of 2010 from $42.4 million in the same period in 2009.
• Net income increased by 160.8% to $31.3 million in the first quarter of 2010 from $12.0 million in the same period in 2009.
• Stockholders' equity increased by 5.0% to $972.1 million at March 31, 2010 compared to $925.5 million at December 31, 2009.

Dividend Policy

The Board of Directors declared a quarterly cash dividend for the first quarter of 2010 of $0.06 per share of common stock. This dividend is payable on July 7, 2010 to stockholders of record as of June 15, 2010.  The declaration and payment of any further dividend remains subject to the discretion of the Board and will depend on, among other things, Navios Holdings' cash requirements as measured by market opportunities and restrictions under its credit agreements.  

Financial Results

For the following results and the selected financial data presented herein, Navios Holdings has compiled consolidated statements of income for the three month periods ended March 31, 2010 and 2009. The information was derived from the unaudited consolidated financial statements for the respective periods. EBITDA is a non-US GAAP financial measure and should not be used in isolation or substitution for Navios Holdings' results.

First Quarter 2010 Results (in thousands of U.S. dollars, unless otherwise stated, except per share data):

Revenue from vessel operations for the three months ended March 31, 2010 was $118.2 million as compared to $117.9 million for the same period during 2009. The slight increase in revenue was mainly attributable to the increase in the available days of the fleet by 8.1% to 4,194 days in the first quarter of 2010 from 3,880 days in the same period of 2009. This was partially offset by the decrease in Time Charter Equivalent ("TCE") per day by 13.4% to $24,484 per day in the first quarter of 2010 from $28,277 per day in the same period of 2009.  The increase in the available days was mainly attributable to the increase by 699 days of the owned fleet available days following the delivery of ten owned vessels during the last three quarters of 2009 and the first quarter of 2010. This increase of available days was offset by a decrease in short and long term fleet available days by 306 days and 79 days, respectively.

Revenue from the logistics business was approximately $36.2 million for the three months ended March 31, 2010 as compared to $29.3 million during the same period of 2009. This increase was mainly attributable to the acquisition of Makenita H, which was fully operational during the second half of 2009 only, to the increased operations of its liquid port and to the increased storage capacity of its dry port in Uruguay following the construction of its new silo.

EBITDA for the three months ended March 31, 2010 increased by $35.7 million to $78.1 million compared to $42.4 million for the first quarter of 2009. The $35.7 million increase in EBITDA was primarily due to an increase in revenue by $7.2 million to $154.4 million in the first quarter of 2010 from $147.2 million in the same period of 2009, a decrease in time charter, voyage and logistic business expenses by $4.6 million from $91.8 million in the first quarter of 2009 to $87.2 million in

the same period in 2010, an increase in equity in net earnings from affiliated companies by $6.4 million, an increase in gain on sale of assets by $24.4 million and an increase in noncontrolling interests by $1.3 million. This overall variance of $43.9 million was offset by an increase in losses from derivatives by $1.8 million, an increase in direct vessel expenses (excluding the amortization of deferred dry dock and special survey costs) by $2.1 million, an increase in general and administrative expenses by $1.7 million (excluding share based compensation expenses), and an increase in net other expenses by $2.6 million.

EBITDA of Navios Logistics was $4.1 million for the three months ended March 31, 2010 as compared to $5.8 million during the same period in 2009.

Net income for the three months ended March 31, 2010 was $31.3 million as compared to $12.0 million for the comparable period of 2009.  The increase of net income by $19.3 million was mainly due to the increase by $35.7 million of EBITDA discussed above, and $0.1 million increase in income tax gain.  These were mitigated by an increase of depreciation and amortization by $9.4 million and the increase in net interest expense by $7.1 million.

Fleet Summary Data:

The following table reflects certain key indicators indicative of the performance of the Navios Holdings and its fleet performance for the three month periods ended March 31, 2010 and 2009.

Conference Call:

As already announced, today, Thursday, May 27, 2010, at 8:30 am EDT, at which time members of senior management will provide highlights and commentary on the first quarter of 2010.

A supplemental slide presentation will be available on the Navios Holdings website at http://www.navios.com under the "Investors" section at 7:45 am EDT today.

This call will be simultaneously Webcast at the following Web address: http://www.videonewswire.com/event.asp?id=69579. The Webcast will be archived and available at this same Web address for two business weeks following the call.

About Navios Maritime Holdings Inc.

Navios Maritime Holdings Inc. is a global, vertically integrated seaborne shipping and logistics company focused on the transport and transshipment of drybulk commodities including iron ore, coal and grain.

Navios Holdings may, from time to time, be required to offer certain owned Capesize and Panamax vessels to Navios Maritime Partners L.P. for purchase at fair market value according to the terms of the Omnibus Agreement.

For more information about Navios Holdings please visit its website: www.navios.com.

About Navios South American Logistics Inc.

Navios Logistics was formed in 2007 through the acquisition of control of the Horamar Group, established in 1975. Navios Logistics specializes in transporting and storing liquid and dry bulk cargoes in the Hidrovia region connecting Argentina, Bolivia, Brazil, Paraguay and Uruguay. Navios Logistics currently controls a fleet of 233 barges and vessels. It also owns and operates an upriver oil storage and transfer facility in Paraguay and the largest bulk transfer and storage port terminal in Uruguay.

About Navios Maritime Partners L.P.

Navios Maritime Partners L.P. (NYSE: NMM), a publicly traded master limited partnership formed by Navios Holdings is an owner and operator of dry bulk vessels. For more information, please visit its website: www.navios-mlp.com.

Forward Looking Statements - Safe Harbor

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 Navios Holdings' growth strategy and measures to implement such strategy; including expected vessel acquisitions and entering into further time charters. Words such as "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 revenues and time charters. 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 changes in the demand for dry bulk vessels, competitive factors in the market in which Navios Holdings operates; risks associated with operations outside the United States; and other factors listed from time to time in Navios Holdings' filings with the Securities and Exchange Commission. 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.

Disclosure of Non-GAAP Financial Measures

EBITDA represents net income plus interest and finance costs plus depreciation and amortization and income taxes, if any, unless otherwise stated. EBITDA is included because it is used by certain investors to measure a company's financial performance. 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.

EBITDA is presented to provide additional information with respect to Navios Holdings' ability to satisfy its obligations including debt service, capital expenditures, working capital requirements and payment of dividends. 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.

SOURCE Navios Maritime Holdings Inc.