Navios Maritime Partners LP (NMM) 2025 Q4 法說會逐字稿

Thank you for joining us on Navios Maritime Partners fourth quarter 2025 earnings conference call.

With us today from the company are Chairwoman and CEO Ms. Angeliki Frangou, Chief Operating Officer Mr. Efstratios Desypris, Chief Financial Officer Mrs. Erifili Tsironi, and Chief Trading Officer Mr. Vincent Vandewalle.

As a reminder, this conference call is being webcast. To access the webcast, please go to the investors section of Navios Partners website at www.navios-MLP.com. You'll see the webcasting link in the middle of the page and a copy of the presentation referenced in today's earnings conference call will also be found there. Now I will review the Safe Harbor statement. This conference call could contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Navio's partners.

Forward-looking statements are statements that are not historical facts. Such forward-looking statements are based upon the current beliefs and expectations of Navios Partners management. And are subject to risks and uncertainties which could cause actual results to differ materially from the forward-looking statements. Such risks are more fully discussed in other partners' filings with the Securities and Exchange Commission.

The information set forth herein should be understood in light of such risks. Navis Partners does not assume any obligation to update the information contained in this conference.

The agenda for today's call is as follows. First, Ms. Frangou will offer opening remarks.

Next, Mr. Desypris will give an overview of another's Parts segment data.

Next, Mrs.Tsironi will give an overview of Navios's Partners financial results. Then Mr. Vandewalle will provide an industry overview. And lastly, we'll open the call to take questions. Now I turn the call over to Navios Partners chairwoman and CEO, Ms. Angeliki Frangou. Angeliki.

Good morning and thank you all for joining us on today's call. I am pleased with the results for the quarter and here in 2025. For the quarter, we reported net income of $117.3 million and a BED of $224.8 million. For the full year, we reported net income of $285.3 million and a BED of $744.6 million.

Earnings per common unit was $3.99 for the quarter and $9.59 for the full year.

We are also pleased to announce a 20% increase in our distribution policy to $0.24 per unit annually commencing for the first quarter of this year.

We are witnessing the evolution of a new world order with new trade agreements arising out of the dust of decaying institutions. At the same time, it seems trade is now a tool of national policy as governments prioritize exports and strategic control of supply chains. National security interests are now a dominant consideration in the decision making metrics. In addition, conflicts and geopolitical tensions are rerouting trade, increasing voyage, distances, costs, and transit times.

As political calculations increase, trade routes are no longer based only on efficiency considerations. As you can see on slide three, our fleet has an average age of 9.6 years compared to an industry average of 13.5 years.

For our three segments. A fleet modernization program has created a fleet that is almost 30% younger than the average and more than 50% junker in comparison to the tanker fleet.

Please turn to slide four. Navios is a leading maritime transportation company, owning, operating, and chartering a modern fleet of 171 vessels across 3 segments and 15 asset classes. Our fleet is split into thirds by value, with about 1/3 in each of the tanker dry bulk and container segments. The overall value of our fleet, including our new building program, is $8.8 billion. For our fleet in the water, we have $4.1 billion in net vessel equity value. We continue to make headway in reducing our net LTV towards our target of 2025%.

At year end we had a net LDV of 30.9%, a balance sheet is strong with $580 million available liquidity and credit ratings of Ba3 for Moody's and BB for Standard and Poor's.

Please turn to slide five.

We believe that diversification is strength when embedded in a culture of risk management. We have a business providing significant optionality in decision making. For example, if we are unable to secure long-term charters that provide a reasonable return, we patiently wait. We allocate capital similarly, waiting for other opportunistic purchases or acquisitions that can be hedged by long-term charters.

Our organization promotes a strong risk management culture. We are continuously monitoring and assessing risk. We evaluate and transactions with risk management professionals. We also obtain robust insurance coverage, and we have implemented many tools to manage operational risks.

Please turn to slide six.

At the end of 2025, our fleet gross LTV was 37.3% and net LTV was 30.9%. Our contracted revenue continues to grow and is now at $3.75 billion. Overall, we have sufficient features for the year to exceed our cash breakeven.

Please turn to slide seven.

Revenue visibility for 2026 demonstrates a strong execution. We secure coverage for 71% of our available days with contracted revenue exceeding cash operating costs by.

$72.7 million. This provides significant visibility while preserving meaningful market exposure to the remaining 29% of our available days, representing 15,565 days that are either open or indexed to sport markets.

A portfolio positioning reflects a thoughtful approach across segments, as shown in the bottom right of the slide. Containers 99% fixed coverage with secured healthy rates, tankers, 84% coverage, high visibility with selective spot exposure. Ride bike, strategic market exposure through available based positioned to capsule upside.

Importantly, we continue to actively pursue long-term charter opportunities that enhance our earning stability.

In the fourth quarter of 2025 and here to date we secured 261 million in new charter commitments.

Please turn to slide eight where we outline a return of capital program. As I mentioned earlier, we increased our annual distribution by 20% to $0.24 per unit annually. This increase was funded primarily through savings generated from our unit repurchase program.

As you can see on the right side of the slide, we reduced units outstanding by 5.3%, employing approximately 73 million to repurchase 1.6 million units. This provided value accretion of approximately $5.20 per unit based on analyst estimates of NAV. Also, we currently have approximately 27 million of capacity under our original authorization.

Please turn to slide nine.

Navios is a proven platform and has executed its strategy through an exceptionally challenging environment. When I opened this discussion, I highlighted the unprecedented uncertainties facing our industry. Geopolitical risks, regional conflicts, a shifting global tariff regime, and evolving trade patterns. Despite this complexity, we remain disciplined and focused. Over the past 4 years, we built a platform of excellency. Growing contracted revenue by 11% to $3.8 billion at a rate of around $750 million and expanding our fleet value, including our new building program to $8.8 billion.

Importantly, we have not sacrificed financial discipline in achieving these goals. We reduced our net loan to value by 31% to 30.9%. We recognize that there is more work ahead, but in an uncertain world, we believe a proven platform combining a diversified fleet with a disciplined risk management culture positions us to continue delivering value through any market condition.

I now turn this presentation over to Mr. Efstratios Desypris; Navios Partners; Chief Operating Officer. Stratos.

Thank you again, again, good morning.

Listen to slide 10 which details our operating free cash flow potential for 2026.

We fixed 71% of available days at the net average rate of $26,865 per day.

Contracted revenue exceeds estimated total cash operating costs by about 173 million and we have 15,565 remaining open or index-linked days that should provide significant additional cash flow.

Moving to slide 11, we continue to maintain a strong backlog of contracted revenue that creates visibility.

During the quarter and year-to-date, we added $261 million of contracted revenue, $97 million from five container ships, chattered out for a net average daily rate of $29,572 for an average duration of about two years.

We also contracted three dry bulk vessels providing a minimum revenue of $93 million.

These vessels were chartered out at an average net daily rate of $23,974 for an average duration of 3.6 years. Two of these vessels have also profit sharing above their base rate.

Lastly, we chartered out three tanker vessels for 2 years at an average net daily rate of $31,944 generating $71 million in contracted revenue.

Total contracted revenue amounts to 3.8 billion. 1.3 billion relates to our tanker fleet. 0.3 billion relates to our driver fleet and 2.2 billion relates to our container ships are extending through 2037 with a diverse group of quality counterparties.

Slide 12 summarizes the fleet developments for Q4 and year-to-date 2026.

We acquired two new buildings, scrubber fitted Japanese cave sized vessels for 134.3 million.

These vessels have been chartered out for about five years. The charters are based on the new BCI index with an average flow rate of about 25,000 per day, an average fixed premium over the index of about 3,000 per day, and a 50 to 50% profit sharing if the adjusted index and premium exceeds the floor.

This structure with floor and profit sharing mechanism provides protection and stable return and participation on the upside.

The vessels are expected to be delivered in the second half of 2028 and first quarter of 2029. We also sold two VLCCs with an average age of 16 years for a price of 136.5 million.

The vessels are expected to be delivered in the second quarter of 2026.

Finally, we took delivery of the new building Aframax/LR 2 vessel, which has been uttered out for five years at a net daily rate of $27,431. Please turn the light.

We are constantly renewing our fleet in order to maintain a junk profile. We reduce our carbon footprint by modernizing our fleet, benefiting from new technologies and advanced environmental friendly features.

We have 26 new building vessels delivering to our fleet through 2029 representing 1.9 billion of investment. Based on our financing both agreed and in process, we have about 197 million equity remaining to be paid. In container ships we have 8 vessels to be delivered with a total acquisition price of about 0.9 billion.

We have mitigated the residual value risk with long-term charters with credit worthy counterparties expected to generate about 0.6 billion aggregate revenue over a five year average charter duration. In tankage we have 16 vessels to be delivered for a total price of approximately 0.9 billion.

We charter around 10 of these vessels for an average period of five years which are expected to generate aggregate contracted revenue of about 0.5 billion. In dry bulk we have two vessels to be delivered with a total purchase price of about 0.1 billion with a minimum contracted revenue of about 0.1 billion.

We also continue to opportunistically sell all the vessels. In 2025 and 2026 here to date, we sold 14 vessels with an average age of 18 years for about 372 million. six were dry bulk vessels, five were tankers, and three were container ships.

I now pass the call to Erifili Tsironi, our CFO, who will take you through the financial highlights. Eric.

Thank you, Stratos and good morning all. I will briefly review our unaudited financial results for the 4th quarter and the year ended 31 December 2025. The financial information is included in the press release and is summarized in the slide presentation available on the company's website.

Moving to the earnings highlights on slide 14, total revenue for the 4th quarter of 2025 increased by 10% to 366 million compared to 333 million for the same period in 2024 due to higher Fleet combined time chart or equivalent rate, despite lower available days. Our flat price rate for the fourth quarter of 2025, Increased by 10% to 25,567 per day, while our available days decreased by 2% to 13,390 days compared to Q4 2024.

In terms of sector performance, our TCE rate per day was high in all three sectors as follows 15% increase to 19,588. For our bulkers, 9% increase to 29, 158 for our tankers and 2% increase to 31,316 for our containers.

EBITDA net income and earnings per common unit for the fourth quarter, a full year 2025 were adjusted as explained in the slide footnote.

Adjusted the for Q425 increased by 25 million to 207 million compared to Q4 2024. The increase was driven primarily by a $33 million increase in revenue, partially mitigated by $4 million increase in time charter and voyage expenses, a $3 million increase in vessel operating expenses, mainly due to a 3% increase in the daily OEX rate to 7,153 per day and a 1 million increase in general and administrative expenses.

Adjusted netting for Q425 increased by 21 million to 100 million. Adjusted earnings and earnings per common unit for the fourth quarter of 25 were 3.4 and $3.99 respectively. Revenue for the full year 25 increased by 10 million to 1.3 billion. Our combined DC rate for 2025 was 23,509 per day, 3% higher compared to 2024.

In terms of sector performance, the average DC rate for our containers increased by 3% to 31,000. 239 per day compared to 2024. In contrast, our dry b average TCE rate was approximately 3% lower to 60,408 per day. The TCE rate for our tanker fleet was marginally below 2024 level at $2711 per day. Adjusted the BDA for the full year 25 decreased by 4 million to 728 million compared to last year.

The decrease despite high revenue and lower than charter and voyage expenses was mainly driven by a $22 million increase in vessel operating expenses as a result of a 3% increase in both OpEx days and OpEx's daily rate to $7,09 per day. A $7 million increase in general and administrative expenses mainly due to higher EUR dollar exchange rate prevailing during the year as well as the expansion of our fleet. And the 4 million increase in other expenses net. Adjusted net income for 2025 decreased by 46 million to 296 million compared to 2024.

The decrease was mainly driven by a 30 million increase in depreciation and amortization and a 10 million increase in interest expense and finance cost net. Adjusted earnings and earning per com unit for the full year 25 were 9.94 and $9.59 respectively.

Turning to slide 15, I will briefly discuss some key balancing data. As of December 31, 2025, cash and cash equivalents, including restricted cash and time deposits in excess of 3 months, were 413 million.

In addition, we have another 167 million available under two reducing revolver facilities. During the year we paid $250 million under a new building program, net of debt. We concluded the sale of 11 vessels for $190 million adding about $145 million cash after debt repayment.

Long-term borrowings, including the current portion, and the senior unsecured bond net of deferred fee increased to 2.2 billion following the delivery of six new buildings during the year. Net debt to book capitalization improved to 32%.

Slide 16 highlights our debt profile. With a recent 300 million senior and secured bond, we further diversified our funding resources in addition to bank debt and leasing structures. The bond has a fixed interest rate of 7.75%, and following the completion of the bond, 43% of our debt is fixed at an average interest rate of 6.2%. We have also mitigated part of the increased interest rate cost by reducing the average margin for our floating rate debt and bare boat liabilities for in the water fleet to 1.8%.

I would like to note that the average margin for the committed floating rate debt for our new building program is 1.6%. In December 25 and January 26, Navios partners completed four finances for a total amount of 325 million.

The 90 million patch facility at 2% margin relates to an asset swap under an existing facility with no penalty in order to assist our charters with the trading of the vessels in the US and China.

A maturity profile this with no significant balloons due in any single year until 2030 when the bond matures. I now pass the call to Vincent Vandewalle, Navios Partners; Chief Trading Officer, to take you through the industry section. Vincent.

Thank you, Eri. Please turn to slide 18. Geopolitical developments continue to shift worldwide trading routes, whether due to tariffs, trade agreements, the Red Sea, or conflicts.

The extradition of Maduro to the US is reshaping trading patterns for Venezuelan oil, with more imports to the US and the elimination of sanctioned vessels.

Civil unrest in Iran has led to a volatile regional situation. The US is building a significant maritime force in the region. In return, Iran attempted to board a US tanker and close parts of the Strait of Hormuz.

Any sustained closure of the Strait of Hormuz would have a severe impact on the oil and tanker markets.

In the meantime, nuclear and other talks are ongoing between the US and Iran.

Sanctions decrease exports from Russia. Prohibitions on importing Russian crude and related products are just starting to affect rates as continuous seizures of sanctioned vessels.

Despite the truce in Gaza, transit through the Red Sea and the Suez Canal continues to be limited, increasing ton miles for most vessel types. In addition, the Houthis announced that they would join any retaliations against US and related targets should anyone attack Iran.

With this uncertainty, Maersk is allowing one of its services to transit the Red Sea with naval escorts, while CMA CGM has ceased service there entirely.

The Ukraine war continues to impact trading patterns with limiting grain exports out of the Black Sea while benefiting exports out of Brazil and the USA.

Russian crude and product exports continue to adjust to tighter sanctions on Russian oil producer Rosneft and Lukoil, elevating rates for non-sanctioned vessels.

Please turn to slide 20 for the review of the dry bulk industry.

The M growth for dry bulk rate has been relatively stable over the last 25 years and at about 4% average annual Tong Mao growth.

The current order book stands at about 12% of the total fleet and will remain low due to high new building prices, uncertainty about new fuel regulations, yard availability, and general market outlook. The fleet is aging quickly, with 39% of the vessels 15 years old. With all the vessels far exceeding those on order, supply should be constrained over the medium term.

Please turn to slide 21.

The main driver of dry bog demand will be strong Atlantic basin iron ore growth over the next several years with new projects in Guinea, Brazil, and Liberia.

The largest new project is Simandou in Guinea, which started shipments at the end of last year and is expected to ramp up to 120 million by 27.

Vale in Brazil has three new projects totaling 50 million tons expected to start exporting by the end of 26.

Liberia will add 10 million of exports in 26. In total, these 180 million tons are all long haul ton miles trading, creating demand for an additional 249 caps.

With the current order book at only 231 caps, a further tightening of supply and demand is expected over the next few years benefiting rates.

Overall, the dry boat market looks positive based on steady long-term demand growth and constrained supply of vessels.

Please turn to slide 23 for the review of the tanker industry.

As to supply, we see a relatively low tanker order book of 18%. About 50% of the fleet is already over 15 years old, rising quickly over the next few years.

With all the vessels exceeding the other boat and yachts offering first deliveries in late 28 or early 29, supply is set to be tight for several years.

Please turn to slide 24. After the US capture and removal of President Maduro in early January, the US is helping Venezuela move from a sanctioned exporter of crude oil to an exporter of crude oil to non-sanctioned buyers.

Improvements will take time but even raising crude exports from near term lows of 0.8 million barrels per day to 1.8 million barrels per day with increased demand for more crude tankers.

Please turn to slide 25. The US Office of Foreign Asset Control, OFAC, the EU and the UK continue to sanction Russian, Venezuelan, and Iranian oil revenue and ships delivering their crude and products. Most recently, countries started to seize sanctioned tankers, with the US seizing nine, France seizing one, and India seizing three small tankers, further reducing the efficiency of the dark fleet.

These tight sanctions have two main effects sanctioning all volumes from these three countries have more difficulty finding willing buyers, raising demand for compliant barrels and non-sanctioned vessels to carry that all. Since the end of December, Russian crude exports to China and India have reduced by 33% and 70% respectively.

With 822 tankers now sanctioned, the fleet has already seen a significant reduction of about 15% of the total capacity.

The tanker market also looks positive over the medium term based on a lower order book, an aging fleet, and a reduced fleet due to sanctions. Please turn to slide 27 for a review of the container industry. After the COVID pandemic, the ordering of container ships was mainly for the biggest units, with fleet expansion in large ships set to continue at high level.

Currently 78% of the order book is for ships with 9,000 TEU capacity or greater, and only 20% of the order book is for 2000 to 9,000 EU capacity where Navios is most active.

Smaller segments of the fleet are well positioned to take advantage of shifting trading patterns, as shown on the right hand graph, growth in non-mainland trades far exceeds the traditional mainland trades to the US and Europe due to tariffs and higher growth in developing countries.

Trading involves the southern hemisphere, mostly served by smaller sized vessels, are expected to see continued healthy growth as this trade shift continues.

Overall, Navio's fleet is well positioned within the container market and continues to benefit from long-term employment with our high-quality charters.

This concludes our presentation. I would now like to turn the call over to Angelique Frangou for her final comments. Angeliki.

Thank you, Vincent.

And we open the call to the questions. (Operator Instructions).

Kristoffer Skeie with Arctic Securities.

Hello, good afternoon and good morning. Thanks for a good presentation. Just first, on the quarter, have you made any changes to your accounting of depreciation given the relatively large drop, versus Q3?

No, actually in Q3, if you recall we had a one-off right of 27 million relating to the termination of certain airport charters.

So this was a one-off just for Q3.

Actually, the economic rationale, actually the economic rationale of those vessels is the one that we got back and we, re-entered in the a very healthy market.

And when it comes to the net LTV, it has dropped quite fast, recent costs, can you share some color on when do you expect the net LTB target to be reached and when that happens, what can we expect in terms of buybacks and dividends?

It's a good question. We think we have the right balance to meet all the challenges and opportunities in this market. I mean, you have seen that we have covered our 2026, all our expenses, and we are about 170 million extra, above our, in extra contracted revenue above our cash operating cost. And we still have 16,000 days open. So basically this flexibility allow us to bring down our LDV, increase our liquidity, and be opportunistic on the most profitable investment opportunities. We continue on our buyback.

And we continue and as you see we increased our dividend, which is primarily driven by savings from repurchase units.

Sure, great.

And the last question for me, I mean, you have, exposure towards dry book, tankers, and container now. Are you seeing any other interesting segments, that you sort of wish to invest in? How do you see that?

We always looking for opportunities, but I would say that today we are sitting in a good position on With all our container exposure fixed and having, and we are having a dry bulk and VLCC mainly days open which is I think a good, we are in.

A very good position.

Absolutely agree. Thanks a lot.

Thank you very much.

Thank you.

And this concludes our Q&A session. I will now turn the call back to Angeliki for closing remarks.

Thank you.

This completes our quarterly results.

Thank you.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.