Navios Maritime Holdings Inc.

Transcription

1 Navios Maritime Holdings Inc. (NASDAQ NMS: BULK) October

2 This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Navios Maritime Holdings Inc. (Navios). Forward looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of Navios management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The information set forth herein should be viewed in light of such risks. This presentation is as of October 10, 2006 and Navios does not assume any obligation to update the information contained in this presentation. For the financial results and the selected financial data presented herein, Navios has compiled consolidated statement of operations for the three month periods ended March 31, 2006 and June 30, 2006 (unaudited) and, combined statement of operations for the year ended December 31, 2005 (including the predecessor business from January 1, 2005 to August 25, 2005 and successor business for the period from August 26, 2005 to December 31, 2005) and consolidated statement of operations for the year ended December 31, The 2004 and 2005 information was derived from the audited financial statements of the successor company and predecessor. Navios has prepared this combined statement of operations information solely to enable comparisons for the years ended December 31, 2005 and The successor period in the combined statement of operations is not directly comparable to the predecessor period because it includes the effects of fair value purchase accounting adjustments. The combined information and EBITDA are non-us GAAP financial measures and should not be used in isolation or substitution for the predecessor and successor results. 2 2

3 Navios Highlights / Corporate Strategy Vertically integrated dry bulk shipping company Vessel Ownership Short Term Charters Contract of Affreightments FFA Trading Substantial Fleet 32 vessels: 18 Panamaxes & 14 Handymaxes 2.1 million DWT capacity Average age 4.4 years Goal: Build fleet of vessels (30-35 owned vessels) New Building Program relationships with Japanese partners / no capital outlay 8 in-the-money purchase options Appropriate revenue mix: stable cash flow from long-term charters; upside from spot Leverage brand name Port & Storage Facility in South America 3 3

4 1. Refocus from Trading to Shipping Scorecard What we promised? Reduce reliance on FFA trading What we delivered. Increased proportion of core shipping 2. Secured Cash Flow 3. Grow Fleet 4. Dividends Emphasize core shipping revenues Lock-in substantial portion of core fleet at attractive rates with quality charterers Grow fleet & transition away from asset light model Dividends to shareholders 95.4% of LTM EBITDA 100% of the core fleet available days secured for % secured for 2007 : 37% for 2008 Grew owned fleet 183% to 17 vessels Quarterly dividends paid since Q Reduction in Operating expenses for owned fleet 6. In-house technical management Reduce OPEX per day for owned fleet Create a strong technical management group in-house OPEX per day reduced 10% from $4,031 / day to $3,613/ day Hired 8 experienced employees and created a technical management group 7. Building Risk Management Group Effective usage of COAs, Short Term Chartering & FFAs to mitigate core fleet risk & capture market opportunity Hired Lori Chan to head Risk Management Group 8. Operational Efficiency Implement new accounting and back office system Fully implemented from Q

5 Management Team Senior management team experienced in the maritime industry and shipping operations Angeliki Frangou Chairman & CEO Vasiliki Papaefthymiou EVP - Legal Michael E. McClure CFO Ted C. Petrone President Navios Corp 16 years experience in the shipping industry Chairman and CEO of Navios since August 2005 Previously founded 2 private shipping companies 14 years experience in Maritime Law General Counsel for Maritime Enterprises since years as General Counsel to Franser Shipping Initiated the risk management department of Navios Former Head of freight derivative trading and market research CFO since October 2005 Previously, SVP responsible for the commercial activities and the FFA trading desk 29 years experience in the shipping industry Joined Navios in 1980 Joined Navios in 1979 Anna Kalathakis SVP- Legal Risk Mgt 12 Years experience in Maritime Law Graduate of Georgetown University, MBA European University and JD - Tulane Joined Navios in 2005 George Achniotis SVP- Business Development PwC partner in charge of shipping practice in Greece UK qualified Chartered Accountant 19 years experience in accounting profession Joined Navios in 2006 Shunji Sasada SVP - Fleet Development 10 years experience with Mitsui O.S.K. Lines Ltd. 6 years experience with Trinity Bulk carriers, a subsidiary of Mitsui O.S.K in Norway Joined Navios in 1997 Lori Chan SVP - Market Risk Management 25 years experience in energy markets Graduate of New York University with MBA in Finance & Management Joined Navios in 2006 Ruben Martinez GM - Uruguay Began as a Mechanical Engineer & promoted to General Manager in 2005 Graduated in Mechanical Engineering from Montevideo University Joined Navios in 1989 GEN0190n.ppt 5 5

6 Vessel Operations 6 6

7 Fleet Overview Controls 32 vessels (2.1 million DWT) In-house commercial management In-house technical management 17 Owned Vessels * 1,041,000 DWT 15 Long Term Chartered-in 1,065,000 DWT Ultra-Handymax 10 vessels (0.53 million DWT) 4 vessels (0.21 million DWT) Panamax 7 vessels (0.51 million DWT) 11 vessels (0.85 million DWT) 8 Purchase Options 2 vessels (0.11 million DWT) 6 vessels (0.46 million DWT) 183% owned fleet growth Average vessel age of 4.4 years (industry average = 15 years) Average long-term in-charter rate = $9,500 per day * Navios Star - Purchase Option declared on Aug 2 nd and delivers in December 7 7

8 [Standard] Jan 1, 2003 Sep 22, 2006 Chartering Policy Panamax Time Charter Daily Index Navios chartered out 12 vessels since Aug 2 Vessels for 3 $22,045 / day 9 Vessels for 2 $22,336 / day 1 Vessel for 1 $19,950 / day Source: The Baltic Exchange / Reuters Jan May Sep Jan May Sep Jan May Sep Jan May Sep Jan May Sep Jan May Sep Jan May Sep Price

9 Secure Ship Employment & Revenue 2006 Secured Employment 100% of available days fixed $163.5 million in revenue Average daily charter-out rate is $17, Secured Employment 73.3% of available days fixed $149 million in revenue Average daily charter-out rate is $19, Secured Employment 37% of available days fixed $92.7 million in revenue Average daily charter-out rate is $21,

10 Operating Efficiencies Strong In-house technical management team OPEX Owned fleet = approximately $3,613 per day* Industry average forecast = $4,410 per day 1 * Average long-term charter-in fleet rate $9,500 per day High Vessel Utilization 99.8% In-transit repairs IT for fleet management & operating efficiency Senior and seasoned commercial team 1 Source: Drewry Shipping Consultants Ltd * Includes drydocking 10 10

11 Dividend Policy 11 11

12 Dividend Policy Dividends paid since Q Pay quarterly dividends equal to $ per share subject to financial performance and market conditions Dividend declared for record owners on August 31, 2006 payable on September 27,

13 Risk Management 13 13

14 Risk Management Tools and implementation Short term (<12 months) chartering in and out of vessels Navios typically controls 5 to 20 vessels through Short Term Charters Short Term Charters FFAs Forward Freight Agreements over the counter swap contracts principal to principal or exchange cleared tied to the Baltic Exchange Indices approximately 7,500 trades in the market in 2005 (Source: FIS London) COAs Contracts of Affreightment contracts to carry freight on specific route and at specific time (as opposed to chartering a vessel) customers typically industrial end-users and international agri-businesses Risk Management Trading Strategies Increasing Freight Rates Expected -> Long Position Decreasing Freight Rates Expected -> Short Position Open Long FFAs / Close Short FFAs Open Short FFAs / Close Long FFAs Charter in spot vessels (short-term) Charter out vessels (short-term) Sell / Close (ie re-let ) existing COAs, Enter new COAs locking in a spread Charter out core vessels (long-term) Charter in new vessels (long-term) Sell owned vessels Buy vessels (long-term) GEN0190n.ppt 14 14

15 Port Terminal & Logistic Business Initiatives 15 15

16 Terminal Operations Largest Port Facility in Tax Free Zone in Uruguay GEN0190n.ppt 16 16

17 17 17

18 Port Facilities Nueva Palmira, Uruguay Terminal Operations Navios Uruguay Annual Throughput Volumes Navios owns and operates a modern port terminal in Nueva Palmira, Uruguay largest bulk transfer/storage facility in Uruguay operates 24 hours a day, 365 days a year additional 11 acres of riverfront land available for future business expansion 2.1 million tons in 2005 lease expires in 2025 with an option to extend for an additional 20 years Non-unionized & located in a tax-free zone well placed for export of commodities from Argentina, Bolivia, Brazil, Paraguay and Uruguay Long-term contracts with Archer Daniels Midland, Cargill & Louis Dreyfus Seven silos with a total storage capacity of 270,440 tons Separate docks for unloading barges and loading Handymax and Panamax vessels Metric Tons (mm) e Uruguayan Soy Exports / / / / / / /2006 (*) Area Seeded (hectares) Production Tons Exports Tons Source: Uruguayan Farm Cooperative, Dec (*)Est. 18

19 Logistics Business Plan Turnkey Service Upriver to Ocean Port of Destination Expand/Upgrade berths & pier facilities Acquire additional land for storing mineral commodities Develop upriver ports and transfer facilities Acquire barges and convoy equipment Develop drying facility Logistics services include: collection/storage points on upriver ports barge transport international transshipments at the Navios Uruguay Port Create shareholder value by converting non-core asset into independent operating business with favorable value creation opportunities 19 19

20 Financial Highlights Q1 & Q and Annual

21 Financial Highlights Q1 & Q Revenue Gains & (Losses) from FFAs EBITDA Depreciation & Amortization Net interest expense Net income Q (10.1) (8.7) 5.0 Q (9.0) (10.1) 4.9 Cash * Total Assets Bank Debt Equity TCE per ship per day** Average Daily Operating Cost $18,530 3,731 $17,329 3,521 Fleet utilization % 99.78% 99.76% *Includes Cash & Cash Equivalents, Restricted Cash and Deposits on exercise of vessel purchase options ** Includes FFAs 21 21

22 Financial Highlights Annual 2005 Aug 26 th Dec 31 st 05 Combined 12-month month 2004 Revenue Gains & (Losses) from FFAs (2.8) EBITDA Depreciation & Amortization (13.6) (17.5) (5.9) Net interest expense (10.7) (11.1) (2.7) Net income Cash* Total Assets Bank Debt Equity TCE per ship per day** 22,771 25,985 Average Daily Operating Cost 3,907 3,745 Fleet utilization % 99.6% 99.6% 22 *Includes Cash & Cash Equivalents, Restricted Cash and Deposits on exercise of vessel purchase options ** Includes FFAs 22

23 Industry Overview 23 23

24 World Dry Cargo Trade Trade (Million tons) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, % 2.5% 2.1% Source : Drewry Bulk Cargo General Cargo 24 24

25 Promising Chinese Long Term Growth 1,200 Prospects Industrial Production 1,000 Index, Base Year = Years From Base Korea Base 1980 Japan Base 1959 China Base 1995 Source: Japanese METI

26 Continued Healthy Demand Emerging countries now make up over half of world GDP (PPP basis)** IMF estimates that emerging countries will grow 6.8% for next 5 years (grew 7% for the last 5 years) Industrial production growth for 2006* China 15.7% India 12.4% Japan 5.1% Germany 4.5% Sustained growth creates high world seaborne trade Dry cargo trade to increase by 108 mtons (6.0%) in 2006 compared to 2005 Accelerated growth in China s fixed-asset investment continues in 2006 Port congestion continues to be a significant factor China transitioning from corn exporter to importer India becoming a net importer of steel Infrastructure investments in mines & logistics increase iron ore export capacity *GDP and Industrial Production indicators per The Economist September 2 nd 2006 ** The Economist September 14 th

27 Dry Bulk Shipping Supply vs. Aging Fleet Orderbook includes 68.4 mdwt (19% of fleet) of scheduled deliveries through New vessels ordered today will not be delivered before 2009 Aging fleet (% Dwt) 11% of Dry Bulk Fleet is more than 25 years old 29% of Dry Bulk Fleet is more than 20 years old 24% of Handymax fleet > 20 years old 22% of Panamax fleet > 20 years old Given strong market conditions, older vessels are not being actively scrapped Number of vessels over 25 years of age exceed number of new buildings delivering over next four years Source: SSY s Dry Bulk Forecaster September 2006 GEN0190n.ppt 27 27

28 Navios Altair - 82,300 dwt Panamax - Delivered Sep 5,

29 Long term Core Fleet 29 29

30 Owned Fleet 183% growth since August 25, Owned Vessels Total Capacity = 1,041,000 DWT Vessels Type Built DWT Charter Rate* Expiration Date ** $ Navios Ionian Ultra Handymax ,068 15,152 3/3/2007 Navios Apollon Ultra Handymax ,073 16,150 9/28/2007 Navios Horizon Ultra Handymax ,346 14,725 6/16/2008 Navios Herakles Ultra Handymax ,061 15,437 3/28/2007 Navios Achilles Ultra Handymax ,063 15,533 1/15/ ,138 1/15/2009 Navios Meridian Ultra Handymax ,316 20,045 12/15/ ,250 8/23/2007 Navios Mercator Ultra Handymax ,553 21,175 12/15/ ,950 12/15/2008 Navios Arc Ultra Handymax ,514 15,438 4/22/2007 Navios Hios Ultra Handymax ,180 19,237 11/15/ ,035 11/15/2008 Navios Kypros Ultra Handymax ,222 16,844 5/13/2007 Navios Gemini S Panamax ,636 16,150 12/6/ ,523 12/21/2008 Navios Libra II Panamax ,136 17,385 8/31/ ,613 9/14/2008 Navios Felicity Panamax ,857 9,144 4/25/2008 Navios Magellan Panamax ,333 14,963 4/1/ ,950 4/1/2008 Navios Galaxy I Panamax ,195 24,062 1/25/2008 Navios Star Panamax ,662 15,343 1/6/ ,375 1/21/2010 Navios Alegria Panamax ,466 23,750 8/9/ ,475 8/9/2008 Average $18,148 * Net of Commissions ** Expected Redelivery basis 1 Navios acquisition by International Shipping Enterprises, Inc 30 30

31 Current Size: Chartered-in Fleet Long Term Chartered-in Vessels: 15 Chartered-in Vessels with 1,065,000 DWT 9 in service; 6 to be delivered 8 purchase options Vessels Type Built DWT Purchase Option Charter Rate* Expiration Date** Navios Vector*** Ultra Handymax ,296 No 8,811 10/17/2007 Navios Astra Ultra Handymax ,400 Yes 17,100 6/1/2007 Navios Cielo Panamax ,834 No 16,863 11/14/ ,175 12/14/2008 Navios Hyperion Panamax ,500 Yes 15,400 1/5/2007 Navios Orbiter Panamax ,602 Yes 16,150 12/31/ ,700 2/23/2009 Navios Aurora Panamax ,200 Yes 24,063 7/6/2008 Navios Orion Panamax ,000 No 21,175 2/13/2007 Navios Titan Panamax ,936 No 20,000 11/24/2007 Navios Altair Panamax ,300 No 22,715 9/20/2009 Navios Sagittarius**** Panamax Nov-06 75,500 Yes 25,413 12/23/2008 Average 19,797 Long Term Chartered-in Vessels on order: Vessels Type To Be DWT Purchase Option Built Navios TBN Ultra Handymax Apr-07 53,500 Yes Navios TBN Panamax Sep-07 82,000 Yes Navios TBN Panamax Nov-07 75,200 No Navios TBN Panamax Mar-08 76,500 Yes Navios TBN Ultra Handymax May-08 55,100 No * Daily Charter Out rate net of commissions *** Charterer has right to extend period at similar daily rate ** Assumed midpoint of redelivery range by charterers **** Vessel to be delivered Nov

32 Navios Maritime Holdings Inc. (NASDAQ NMS: BULK) October