TCE was $40,835 for 3Q16, compared with $45,432 for 3Q15. The decrease in TCE was mainly due to a fall of $1.5 mill in profit sharing obtained on certain charters during 3Q16.
EBITDA decreased by about $0.5 mill to $15.7 mill for the three month period, compared to $16.2 mill for 3Q15. This drop was due to a: (a) $0.3 mill decrease in revenue; (b) $0.2 mill increase in timecharter expenses; and (c) $0.1 mill increase in general and administrative expenses.
The reserve for estimated maintenance and replacement for capital expenditures for each of the three month periods under discussion was $3.6 mill.
Navios Midstream generated an operating surplus of $9.3 mill in 3Q16.
Net income was $5.5 mill, compared to $6.2 mill for 3Q15. The decrease was due to a: (a) $0.5 mill decrease in EBITDA; and (b) $0.4 mill increase in direct vessel expenses; partially mitigated by a $0.1 mill increase in interest income.
However, revenue for the first nine months of 2016 increased by $11.5 mill to $69.1 mill, compared to $57.5 mill for the same period the previous year.
This increase was due to the acquisition of the ‘Nave Celeste’ and the ‘C Dream’ in June 2015 and an increase of $0.4 mill in profit sharing on certain charters during the period, compared to the same period of 2015.
TCE was $43,295, compared with $45,917 for the previous nine month period. The decrease was due to the lower average charter rate of the two VLCCs acquired in June 2015, compared to the existing fleet.
EBITDA increased by about $7 mill to $49.8 mill for the nine month period, compared to $42.8 mill for the same period in 2015. The increase was mainly due to an $11.5 mill increase in revenue but was partially mitigated by a: (a) $3.2 mill increase in management fees; (b) $0.6 mill increase in general and administrative expenses; (c) $0.5 mill increase in timecharter expenses; and (d) $0.1 mill increase in other (expense)/ income, net.
The company generated an operating surplus for the nine month period of $30.6 mill.
Net income was $18.8 mill, compared to $17.9 mill in 2015. The increase of around $0.9 mill was due to: (a) $7 mill increase in EBITDA; and (b) $0.2 mill increase in interest income; partially mitigated by: (i) $2.8 mill increase in depreciation and amortisation; (ii) $2 mill increase in interest expenses and finance cost; and (iii) $1.4 mill increase in direct vessel expenses.
Angeliki Frangou, Navios Midstream chairman and CEO, said: “We are pleased with our third quarter results, for which we recorded $15.7 mill of EBITDA and $5.5 mill of net income. We recently announced a distribution of $0.4225 per unit, representing an annual distribution of $1.69 and a current yield of approximately 15% per unit. Our unit coverage ratio was 1.06x for the quarter.
“Navios Midstream extended the fixed fee under the management agreement until December, 2018 with no increase. Operating expenses for commercial and technical management of the vessels thus remain at $9,500 per day, about 8% below the industry average. Navios Midstream also extended, for a two-year period, purchase options for three of the five vessels, all of which were scheduled to expire in November of 2016. The commercial terms of the options will remain the same and Navios Maritime Acquisition Corp will not be providing any charter rate backstop. We anticipate that these options will provide a continued avenue for fleet and distribution growth,” she said.
Subsequently this month, Navios Midstream amended its existing management agreement with Navios Tankers Management, a wholly-owned subsidiary of Navios Maritime Holdings, to extend the fixed fee period for commercial and technical management services of its fleet, until 31st December, 2018 at the current rate of $9,500 per day per VLCC, following the expiration of the current fixed fee period. Drydocking expenses are reimbursed at cost for all vessels.
The company holds options to acquire up to five VLCCs from Navios Maritime Acquisition Corp expiring on 18th November, 2016. In October, 2016, Navios Acquisition extended the options of the ‘Nave Buena Suerte’, the ‘Nave Neutrino’ and the ‘Nave Electron’ for an additional two-year period expiring on 18th November 2018.
The purchase price will be equal to the fair market value of each of the three vessels at the time of the options’ exercise. The extended purchase options do not include any backstop commitments from Navios Acquisition, the company explained.