SOURCE: Costamare Inc.

Costamare Inc.

April 20, 2016 16:15 ET

Costamare Inc. Reports Results for the First Quarter Ended March 31, 2016

MONACO--(Marketwired - Apr 20, 2016) - Costamare Inc. ("Costamare" or the "Company") (NYSE: CMRE) today reported unaudited financial results for the first quarter ended March 31, 2016.

  • Voyage revenues adjusted on a cash basis of $119.8 million for the three months ended March 31, 2016

  • Adjusted EBITDA of $85.3 million for the three months ended March 31, 2016.

  • Adjusted Net income available to common stockholders of $34.3 million or $0.45 per share for the three months ended March 31, 2016.

See "Financial Summary" and "Non-GAAP Measures" below for additional detail.

Dividend Announcements

  • On April 1, 2016, we declared a dividend for the first quarter ended March 31, 2016, of $0.29 per share on our common stock, payable on May 4, 2016, to stockholders of record on April 19, 2016.

  • On April 1, 2016, we declared a dividend of $0.476563 per share on our Series B Preferred Stock, a dividend of $0.531250 per share on our Series C Preferred Stock and a dividend of $0.546875 per share on our Series D Preferred Stock which were all paid on April 15, 2016 to holders of record on April 14, 2016.

  • To date, we have declared dividends in 22 consecutive quarters. Over the past five years, we have increased the dividend 16%.

New Business Developments

  • In January 2016, we entered into an agreement to extend the repayment schedule of the Alpha credit facility from December 2017 to December 2020. The Alpha credit facility is secured by the 1997 and 1996 built, 7,403 TEU containerships Maersk Kawasaki and Maersk Kure and had an outstanding balance of $66 million as of March 31, 2016.

  • The Company entered into the following charter arrangements:

    • Agreed to extend the charters of the MSC Reunion, MSC Namibia II and MSC Sierra II, the 2,000 TEU containerships, built in 1992, 1991 and 1991, respectively, with MSC for a period of minimum 11 and maximum 13 months starting from August 27, 2016, August 2, 2016 and July 1, 2016, respectively, at a daily rate of $6,800.
    •  Agreed to extend the charter of the 1995-built, 1,162 TEU containership Zagora with MSC for a period of minimum 12 and maximum 14 months starting from June 1, 2016 at a daily rate of $6,200.
    • Agreed to extend the charter of the 1991-built, 3,351 TEU containership Karmen with Evergreen for a period of minimum 4 and maximum 9 months starting from February 27, 2016 at a daily rate of $6,500.
    • Agreed to extend the charter of the 1998-built, 1,645 TEU containership Padma with Yang Ming for a period of minimum 4 and maximum 10 months starting from April 26, 2016 at a daily rate of $7,250.
    • Agreed to charter the 1998-built, 3,842 TEU containership Itea with Hapa-Lloyd for a period of minimum 4 weeks and maximum 6 months starting from April 20, 2016 at a daily rate of $6,250.
    • Agreed to charter the 2000-built, 2,474 TEU containership Areopolis with Evergreen for a period of minimum 3 and maximum 8 months starting from March 31, 2016 at a daily rate of $5,950.

Mr. Gregory Zikos, Chief Financial Officer of Costamare Inc., commented:

"During the first quarter the Company delivered solid results.

In a challenging market environment we keep employing our vessels, having chartered in total nine ships opening during the first three months of the year.

On the market, charter rates and asset values are at historically low levels as a result of weak demand.

We believe that today's environment provides attractive opportunities and the potential to increase our shareholders' returns."

Financial Summary

         
  Three-month period ended March 31,  
(Expressed in thousands of U.S. dollars, except share and per share data): 2015   2016  
       
             
Voyage revenue $ 120,850   $ 120,274  
Accrued charter revenue (1) $ 627   $ (452 )
Voyage revenue adjusted on a cash basis (2) $ 121,477   $ 119,822  
             
Adjusted EBITDA (3) $ 86,035   $ 85,274  
             
Adjusted Net Income available to common stockholders (3) $ 28,629   $ 34,307  
Weighted Average number of shares   74,801,662     75,400,044  
Adjusted Earnings per share (3) $ 0.38   $ 0.45  
             
EBITDA (3) $ 81,908   $ 81,994  
Net Income $ 26,284   $ 34,996  
Net Income available to common stockholders $ 23,274   $ 29,789  
Weighted Average number of shares   74,801,662     75,400,044  
Earnings per share $ 0.31   $ 0.40  

(1) Accrued charter revenue represents the difference between cash received during the period and revenue recognized on a straight-line basis. In the early years of a charter with escalating charter rates, voyage revenue will exceed cash received during the period and during the last years of such charter cash received will exceed revenue recognized on a straight line basis.
(2) Voyage revenue adjusted on a cash basis represents Voyage revenue after adjusting for non-cash "Accrued charter revenue" recorded under charters with escalating charter rates. However, Voyage revenue adjusted on a cash basis is not a recognized measurement under U.S. generally accepted accounting principles ("GAAP"). We believe that the presentation of Voyage revenue adjusted on a cash basis is useful to investors because it presents the charter revenue for the relevant period based on the then current daily charter rates. The increases or decreases in daily charter rates under our charter party agreements are described in the notes to the "Fleet List" below.
(3) Adjusted net income available to common stockholders, adjusted earnings per share, EBITDA and adjusted EBITDA are non-GAAP measures. Refer to the reconciliation of net income to adjusted net income and net income available to common stockholders to EBITDA and adjusted EBITDA below.

Non-GAAP Measures

The Company reports its financial results in accordance with U.S. GAAP. However, management believes that certain non-GAAP financial measures used in managing the business may provide users of these financial measures additional meaningful comparisons between current results and results in prior operating periods. Management believes that these non-GAAP financial measures can provide additional meaningful reflection of underlying trends of the business because they provide a comparison of historical information that excludes certain items that impact the overall comparability. Management also uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company's performance. The tables below set out supplemental financial data and corresponding reconciliations to GAAP financial measures for the three-month periods ended March 31, 2016 and 2015. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, voyage revenue or net income as determined in accordance with GAAP. Non-GAAP financial measures include (i) Voyage revenue adjusted on a cash basis (reconciled above), (ii) Adjusted Net Income available to common stockholders, (iii) Adjusted Earnings per share, (iv) EBITDA and (v) Adjusted EBITDA.

Reconciliation of Net Income to Adjusted Net Income available to common stockholders and Adjusted Earnings per Share

           
  Three-month period ended March 31,  
(Expressed in thousands of U.S. dollars, except share and per share data) 2015     2016  
       
Net Income $ 26,284     $ 34,996  
Earnings allocated to Preferred Stock   (3,010 )     (5,207 )
Net Income available to common stockholders   23,274       29,789  
Accrued charter revenue   627       (452 )
Unrealized loss from swap option agreement held by a jointly owned company with York included in equity loss on investments   380       -  
General and administrative expenses - non-cash component   2,634       1,344  
Amortization of prepaid lease rentals   1,228       1,238  
Realized Loss / (Gain) on Euro/USD forward contracts (1)   1,030       (239 )
Loss / (Gain) on derivative instruments (1)   (544 )     2,627  
               
Adjusted Net income available to common stockholders $ 28,629     $ 34,307  
Adjusted Earnings per Share $ 0.38     $ 0.45  
Weighted average number of shares   74,801,662       75,400,044  

Adjusted Net Income available to common stockholders and Adjusted Earnings per Share represent net income after earnings allocated to preferred stock, but before non-cash "Accrued charter revenue" recorded under charters with escalating charter rates, realized loss / (gain) on Euro/USD forward contracts, unrealized loss from a swap option agreement held by a jointly owned company with York, which is included in equity loss on investments, General and administrative expenses - non-cash component, amortization of prepaid lease rentals and non-cash changes in fair value of derivatives. "Accrued charter revenue" is attributed to the timing difference between the revenue recognition and the cash collection. However, Adjusted Net Income available to common stockholders and Adjusted Earnings per Share are not recognized measurements under U.S. GAAP. We believe that the presentation of Adjusted Net Income available to common stockholders and Adjusted Earnings per Share are useful to investors because they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We also believe that Adjusted Net Income available to common stockholders and Adjusted Earnings per Share are useful in evaluating our ability to service additional debt and make capital expenditures. In addition, we believe that Adjusted Net Income available to common stockholders and Adjusted Earnings per Share are useful in evaluating our operating performance and liquidity position compared to that of other companies in our industry because the calculation of Adjusted Net Income available to common stockholders and Adjusted Earnings per Share generally eliminates the effects of the accounting effects of capital expenditures and acquisitions, certain hedging instruments and other accounting treatments, items which may vary for different companies for reasons unrelated to overall operating performance and liquidity. In evaluating Adjusted Net Income available to common stockholders and Adjusted Earnings per Share, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted Net Income available to common stockholders and Adjusted Earnings per Share should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

(1) Items to consider for comparability include gains and charges. Gains positively impacting net income are reflected as deductions to adjusted net income. Charges negatively impacting net income are reflected as increases to adjusted net income.

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

           
  Three-month period ended March 31,  
(Expressed in thousands of U.S. dollars) 2015     2016  
       
               
Net Income $ 26,284     $ 34,996  
Interest and finance costs   27,943       18,906  
Interest income   (438 )     (361 )
Depreciation   25,066       25,281  
Amortization of prepaid lease rentals   1,228       1,238  
Amortization of dry-docking and special survey costs   1,825       1,934  
EBITDA   81,908       81,994  
Accrued charter revenue   627       (452 )
Unrealized loss from swap option agreement held by a jointly owned company with York included in equity loss on investments   380       -  
General and administrative expenses - non-cash component   2,634       1,344  
Realized Loss / (Gain) on Euro/USD forward contracts (1)   1,030       (239 )
Loss / (Gain) on derivative instruments (1)   (544 )     2,627  
Adjusted EBITDA $ 86,035     $ 85,274  

EBITDA represents net income before interest and finance costs, interest income, amortization of prepaid lease rentals, depreciation and amortization of deferred dry-docking and special survey costs. Adjusted EBITDA represents net income before interest and finance costs, interest income, amortization of prepaid lease rentals, depreciation, amortization of deferred dry-docking and special survey costs, non-cash "Accrued charter revenue" recorded under charters with escalating charter rates, realized loss / (gain) on Euro/USD forward contracts, unrealized loss from swap option agreement held by a jointly owned company with York, which is included in equity loss on investments, General and administrative expenses - non-cash component and non-cash changes in fair value of derivatives. "Accrued charter revenue" is attributed to the time difference between the revenue recognition and the cash collection. However, EBITDA and Adjusted EBITDA are not recognized measurements under U.S. GAAP. We believe that the presentation of EBITDA and Adjusted EBITDA are useful to investors because they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We also believe that EBITDA and Adjusted EBITDA are useful in evaluating our ability to service additional debt and make capital expenditures. In addition, we believe that EBITDA and Adjusted EBITDA are useful in evaluating our operating performance and liquidity position compared to that of other companies in our industry because the calculation of EBITDA and Adjusted EBITDA generally eliminates the effects of financings, income taxes and the accounting effects of capital expenditures and acquisitions, items which may vary for different companies for reasons unrelated to overall operating performance and liquidity. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
(1) Items to consider for comparability include gains and charges. Gains positively impacting net income are reflected as deductions to adjusted EBITDA. Charges negatively impacting net income are reflected as increases to adjusted EBITDA.

Results of Operations
Three-month period ended March 31, 2016 compared to the three-month period ended March 31, 2015

During the three-month periods ended March 31, 2016 and 2015, we had an average of 54.0 and 55.0 vessels, respectively, in our fleet. In the three-month periods ended March 31, 2016 and 2015, our fleet ownership days totaled 4,914 and 4,950 days, respectively. Ownership days are the primary driver of voyage revenue and vessels' operating expenses and represent the aggregate number of days in a period during which each vessel in our fleet is owned.

                         
(Expressed in millions of U.S. dollars,
except percentages)
  Three-month period
ended March 31,
    Change     Percentage
Change
 
2015     2016    
         
                               
Voyage revenue   $ 120.9     $ 120.3     $ (0.6 )   (0.5 %)
Voyage expenses     (0.6 )     (0.6 )     -     -  
Voyage expenses - related parties     (0.9 )     (0.9 )     -     -  
Vessels' operating expenses     (29.6 )     (27.0 )     (2.6 )   (8.8 %)
General and administrative expenses     (1.3 )     (1.2 )     (0.1 )   (7.7 %)
Management fees - related parties     (4.8 )     (4.8 )     -     -  
General and administrative expenses - non-cash component     (2.6 )     (1.3 )     (1.3 )   (50.0 %)
Amortization of dry-docking and special survey costs     (1.8 )     (1.9 )     0.1     5.6 %
Depreciation     (25.1 )     (25.3 )     0.2     0.8 %
Amortization of prepaid lease rentals     (1.2 )     (1.2 )     -     -  
Foreign exchange gains/ (losses)     0.2       (0.1 )     (0.3 )   (150.0 %)
Interest income     0.4       0.3       (0.1 )   (25.0 %)
Interest and finance costs     (27.9 )     (18.9 )     (9.0 )   (32.3 %)
Equity loss on investments     (0.2 )     (0.2 )     -     -  
Other     0.3       0.4       0.1     33.3 %
Gain / (Loss) on derivative instruments     0.5       (2.6 )     (3.1 )   (620.0 %)
Net Income   $ 26.3     $ 35.0                
                       
(Expressed in millions of U.S. dollars,
except percentages)
  Three-month period
ended March 31,
    Change     Percentage
Change
 
2015   2016    
                             
Voyage revenue   $ 120.9   $ 120.3     $ (0.6 )   (0.5 %)
Accrued charter revenue     0.6     (0.5 )     (1.1 )   (183.3 %)
Voyage revenue adjusted on a cash basis   $ 121.5   $ 119.8     $ (1.7 )   (1.4 %)
                     
Vessels operational data   Three-month period
ended March 31,
        Percentage
Change
 
2015   2016   Change    
                     
Average number of vessels   55.0   54.0   (1.0 )   (1.8 %)
Ownership days   4,950   4,914   (36.0 )   (0.7 %)
Number of vessels under dry-docking   2   3   1        

Voyage Revenue
Voyage revenue decreased by 0.5%, or $0.6 million, to $120.3 million during the three-month period ended March 31, 2016, from $120.9 million during the three-month period ended March 31, 2015. The decrease was mainly attributable to the decreased average number of vessels and revenue days of our fleet, during the three-month period ended March 31, 2016 compared to the three-month period ended March 31, 2015, partly offset by revenue earned due to increased calendar days by one day during the first quarter of 2016 (91 calendar days) compared to the first quarter of 2015 (90 calendar days).

Voyage revenue adjusted on a cash basis (which eliminates non-cash "Accrued charter revenue"), decreased by 1.4%, or $1.7 million, to $119.8 million during the three-month period ended March 31, 2016, from $121.5 million during the three-month period ended March 31, 2015. The decrease was mainly attributable to the decreased average number of vessels and revenue days of our fleet, during the three-month period ended March 31, 2016 compared to the three-month period ended March 31, 2015, partly offset by revenue earned due to increased calendar days by one day during the first quarter of 2016 (91 calendar days) compared to the first quarter of 2015 (90 calendar days).

Voyage Expenses
Voyage expenses were $0.6 million, during the three-month periods ended March 31, 2016 and 2015. Voyage expenses mainly include (i) off-hire expenses of our vessels, mainly related to fuel consumption and (ii) third party commissions.

Voyage Expenses - related parties
Voyage expenses - related parties in the amount of $0.9 million during the three-month periods ended March 31, 2016 and 2015, represent fees of 0.75% on voyage revenues charged to us by Costamare Shipping Company S.A. ("Costamare Shipping") and Costamare Shipping Services Ltd. ("Costamare Services"), as provided under the Framework Agreement and Services Agreement, respectively.

Vessels' Operating Expenses
Vessels' operating expenses, which also include the realized gain / (loss) under derivative contracts entered into in relation to foreign currency exposure, decreased by 8.8%, or $2.6 million, to $27.0 million during the three-month period ended March 31, 2016, from $29.6 million during the three-month period ended March 31, 2015.

General and Administrative Expenses
General and administrative expenses decreased by 7.7%, or $0.1 million, to $1.2 million during the three-month period ended March 31, 2016, from $1.3 million during the three-month period ended March 31, 2015. General and administrative expenses for the three-month periods ended March 31, 2016 and 2015, included $0.63 million which is part of the annual fee that Costamare Services receives based on the Services Agreement, effected on November 2, 2015. Prior to November 2, 2015, this annual fee was charged by Costamare Shipping pursuant to the amended and restated Group Management Agreement.

Management Fees - related parties
Management fees paid to our managers were $4.8 million during the three month periods ended March 31, 2016 and 2015.

General and Administrative expenses - non-cash component
General and administrative expenses - non-cash component for the three-month period ended March 31, 2016 amounted to $1.3 million, representing the value of the shares issued to Costamare Services on March 31, 2016, pursuant to the Services Agreement effected on November 2, 2015. For the three-month period ended March 31, 2015, the non-cash component of general and administrative expenses was $2.6 million, representing the value of shares issued to Costamare Shipping pursuant to the amended and restated group management agreement, which was effective from January 1, 2015 until November 2, 2015.

Amortization of Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs was $1.9 million for the three-month period ended March 31, 2016 and $1.8 million for the three-month period ended March 31, 2015. During the three-month period ended March 31, 2016 one vessel completed its respective works and two were in process. During the three-month period ended March 31, 2015 two vessels underwent and completed their special surveys.

Depreciation
Depreciation expense increased by 0.8%, or $0.2 million, to $25.3 million during the three-month period ended March 31, 2016, from $25.1 million during the three-month period ended March 31, 2015. The increase was mainly attributable to the increased calendar days by one day during the first quarter of 2016 (91 calendar days) compared to the first quarter of 2015 (90 calendar days).

Foreign Exchange Gains/ (Losses)
Foreign exchange losses were $0.1 million during the three-month period ended March 31, 2016. Foreign exchange gains were $0.2 million during the three-month period ended March 31, 2015.

Interest Income
Interest income for the three-month periods ended March 31, 2016 and 2015 amounted to $0.3 million and $0.4 million, respectively.

Interest and Finance Costs
Interest and finance costs decreased by 32.3%, or $9.0 million, to $18.9 million during the three-month period ended March 31, 2016, from $27.9 million during the three-month period ended March 31, 2015. The decrease was partly attributable to the decreased loan interest expense (including interest charged in relation with our interest rate swap arrangements) charged to the consolidated statement of income resulting from the decrease in the outstanding loan amount.

Equity Loss on Investments
The equity loss on investments of $0.2 million for the three-month period ended March 31, 2016, represents our share of the net losses of nineteen jointly owned companies pursuant to the Framework Agreement with York. We hold a range of 25% to 49% of the capital stock of these companies.

Gain / (Loss) on Derivative Instruments
The fair value of our 18 interest rate derivative instruments which were outstanding as of March 31, 2016 equates to the amount that would be paid by us or to us should those instruments be terminated. As of March 31, 2016, the fair value of these 18 interest rate derivative instruments in aggregate amounted to a liability of $54.7 million. The effective portion of the change in the fair value of the interest rate derivative instruments that qualified for hedge accounting is recorded in "Other Comprehensive Income" ("OCI") while the ineffective portion is recorded in the consolidated statements of income. The change in the fair value of the interest rate derivative instruments that did not qualify for hedge accounting is recorded in the consolidated statement of income. For the three-month period ended March 31, 2016, a net loss of $5.1 million has been included in OCI and a net loss of $3.1 million has been included in Gain / (Loss) on derivative instruments in the consolidated statement of income, resulting from the fair market value change of the interest rate derivative instruments during the three-month period ended March 31, 2016.

Cash Flows

Three-month periods ended March 31, 2016 and 2015

           
Condensed cash flows Three-month period ended March 31,  
(Expressed in millions of U.S. dollars) 2015     2016  
Net Cash Provided by Operating Activities $ 54.9     $ 57.4  
Net Cash Used in Investing Activities $ (13.4 )   $ (7.0 )
Net Cash Used in Financing Activities $ (70.3 )   $ (69.3 )

Net Cash Provided by Operating Activities
Net cash flows provided by operating activities for the three-month period ended March 31, 2016, increased by $2.5 million to $57.4 million, compared to $54.9 million for the three-month period ended March 31, 2015. The increase was mainly attributable to decreased payments for interest (including swap payments) during the period of $2.4 million in the three-month period ended March 31, 2016 compared to the three-month period ended March 31, 2015.

Net Cash Used in Investing Activities
Net cash used in investing activities was $7.0 million in the three-month period ended March 31, 2016, which mainly consisted of $6.5 million (net of $2.7 million we received as dividend distributions) in advance payments for the construction of one newbuild vessel and the acquisition of a secondhand vessel, pursuant to the Framework Agreement with York; we hold equity interests ranging from 25% to 49% in nineteen jointly-owned companies.

Net cash used in investing activities was $13.4 million in the three-month period ended March 31, 2015, which mainly consisted of $13.0 million in advance payments for the construction of two newbuild vessels, pursuant to the Framework Agreement with York; we hold an equity interest ranging from 25% to 49% in jointly-owned companies.

Net Cash Used in Financing Activities
Net cash used in financing activities was $69.3 million in the three-month period ended March 31, 2016, which mainly consisted of (a) $47.9 million of indebtedness that we repaid, (b) $3.5 million we repaid relating to our sale and leaseback agreements (c) $21.9 million we paid for dividends to holders of our common stock for the fourth quarter of 2015, and (d) $1.0 million we paid for dividends to holders of our 7.625% Series B Cumulative Redeemable Perpetual Preferred Stock ( "Series B Preferred Stock"), $2.1 million we paid for dividends to holders of our 8.500% Series C Cumulative Redeemable Perpetual Preferred Stock ( "Series C Preferred Stock") and $2.2 million we paid for dividends to holders of our 8.75% Series D Cumulative Redeemable Perpetual Preferred Stock ( "Series D Preferred Stock"), for the period from October 15, 2015 to January 14, 2016.

Net cash used in financing activities was $70.3 million in the three-month period ended March 31, 2015, which mainly consisted of (a) $50.0 million of indebtedness that we repaid, (b) $3.3 million we repaid relating to our sale and leaseback agreements (c) $20.9 million we paid for dividends to holders of our common stock for the second quarter of 2014, and (d) $1.0 million we paid for dividends to holders of our 7.625% Series B Cumulative Redeemable Perpetual Preferred Stock ( "Series B Preferred Stock") and $2.1 million we paid for dividends to holders of our 8.500% Series C Cumulative Redeemable Perpetual Preferred Stock ( "Series C Preferred Stock"), in both cases for the period from October 15, 2014 to January 14, 2015.

Liquidity and Capital Expenditures

Cash and cash equivalents
As of March 31, 2016, we had a total cash liquidity of $134.4 million, consisting of cash, cash equivalents and restricted cash.

Debt-free vessels
As of April 20, 2016, the following vessels were free of debt.

 
Unencumbered Vessels in the water(*)
(refer to fleet list for full charter details)
 
Vessel Name   Year
Built
  TEU
Capacity
NAVARINO   2010   8,531
VENETIKO   2003   5,928
MSC ITEA   1998   3,842
LAKONIA   2004   2,586
AREOPOLIS   2000   2,474
MESSINI   1997   2,458
NEAPOLIS   2000   1,645

(*) Does not include three secondhand vessels acquired and five newbuild vessels ordered pursuant to the Framework Agreement with York, which are also free of debt.

Capital commitments

As of April 20, 2016, we had outstanding equity commitments relating to our twelve contracted newbuilds aggregating approximately $104.5 million payable until the vessels are delivered. The amounts represent our interest in the relevant jointly-owned entities with York. Approximately $86.4 million of the above mentioned commitments, relate to five 11,000 TEU vessels on order, for which we are in discussions to finance with several banks.

Conference Call details:
On Thursday, April 21, 2016, at 8:30 a.m. ET, Costamare's management team will hold a conference call to discuss the financial results.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1-866-524-3160 (from the US), 0808 238 9064 (from the UK) or +1-412-317-6760 (from outside the US). Please quote "Costamare".

A replay of the conference call will be available until May 21, 2016. The United States replay number is +1-877-344-7529; the standard international replay number is +1-412-317-0088, and the access code required for the replay is: 10084316.

Live webcast:

There will also be a simultaneous live webcast over the Internet, through the Costamare Inc. website (www.costamare.com) under the "Investors" section. Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About Costamare Inc.

Costamare Inc. is one of the world's leading owners and providers of containerships for charter. The Company has 42 years of history in the international shipping industry and a fleet of 72 containerships, with a total capacity of approximately 467,000 TEU, including 12 newbuild containerships to be delivered. Eighteen of our containerships, including 12 newbuilds on order, have been acquired pursuant to the Framework Agreement with York Capital Management by vessel-owning joint venture entities in which we hold a minority equity interest. The Company's common stock, Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock trade on the New York Stock Exchange under the symbols "CMRE", "CMRE PR B", "CMRE PR C" and "CMRE PR D", respectively.

Forward-Looking Statements

This earnings release contains "forward-looking statements". In some cases, you can identify these statements by forward-looking words such as "believe", "intend", "anticipate", "estimate", "project", "forecast", "plan", "potential", "may", "should", "could" and "expect" and similar expressions. These statements are not historical facts but instead represent only Costamare's belief regarding future results, many of which, by their nature, are inherently uncertain and outside of Costamare's control. It is possible that actual results may differ, possibly materially, from those anticipated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect future results, see the discussion in Costamare Inc.'s Annual Report on Form 20-F (File No. 001-34934) under the caption "Risk Factors".

Fleet List

The tables below provide additional information, as of April 20, 2016, about our fleet of containerships, including our newbuilds on order, the vessels acquired pursuant to the Framework Agreement with York and those vessels subject to sale and leaseback agreements. Each vessel is a cellular containership, meaning it is a dedicated container vessel.

  Vessel Name Charterer Year Built Capacity (TEU) Time Charter Term(1) Current Daily Charter Rate (U.S. dollars) Expiration of Charter(1) Average Daily Charter Rate Until Earliest Expiry of Charter (U.S. dollars)(2)
1 COSCO GUANGZHOU COSCO 2006 9,469 12 years 36,400 December 2017 36,400
2 COSCO NINGBO COSCO 2006 9,469 12 years 36,400 January 2018 36,400
3 COSCO YANTIAN COSCO 2006 9,469 12 years 36,400 February 2018 36,400
4 COSCO BEIJING COSCO 2006 9,469 12 years 36,400 April 2018 36,400
5 COSCO HELLAS COSCO 2006 9,469 12 years 37,519 May 2018 37,519
6 MSC AZOV(**) MSC 2014 9,403 10 years 43,000 November 2023 43,000
7 MSC AJACCIO(**) MSC 2014 9,403 10 years 43,000 February 2024 43,000
8 MSC AMALFI(**) MSC 2014 9,403 10 years 43,000 March 2024 43,000
9 MSC ATHENS MSC 2013 8,827 10 years 42,000 January 2023 42,000
10 MSC ATHOS MSC 2013 8,827 10 years 42,000 February 2023 42,000
11 VALOR Evergreen 2013 8,827 7.0 years(i) 41,700 April 2020(i) 41,700
12 VALUE Evergreen 2013 8,827 7.0 years(i) 41,700 April 2020(i) 41,700
13 VALIANT Evergreen 2013 8,827 7.0 years(i) 41,700 June 2020(i) 41,700
14 VALENCE Evergreen 2013 8,827 7.0 years(i) 41,700 July 2020(i) 41,700
15 VANTAGE Evergreen 2013 8,827 7.0 years(i) 41,700 September
2020(i)
41,700
16 NAVARINO PIL 2010 8,531 1.0 year 10,500 November
2016(ii)
10,500
17 MAERSK KAWASAKI(iii) A.P. Moller-Maersk 1997 7,403 10 years 37,000 December 2017 37,000
18 MAERSK KURE(iii) A.P. Moller-Maersk 1996 7,403 10 years 37,000 December 2017 37,000
19 MAERSK KOKURA(iii) A.P. Moller-Maersk 1997 7,403 10 years 37,000 February 2018 37,000
20 MSC METHONI MSC 2003 6,724 10 years 29,000 September 2021 29,000
21 SEALAND NEW YORK A.P. Moller-Maersk 2000 6,648 11 years 26,100 March 2018 26,100
22 MAERSK KOBE A.P. Moller-Maersk 2000 6,648 11 years 26,100 May 2018 26,100
23 SEALAND WASHINGTON A.P. Moller-Maersk 2000 6,648 11 years 26,100 June 2018 26,100
24 SEALAND MICHIGAN A.P. Moller-Maersk 2000 6,648 11 years 26,100 August 2018 26,100
25 SEALAND ILLINOIS A.P. Moller-Maersk 2000 6,648 11 years 26,100 October 2018 26,100
26 MAERSK KOLKATA A.P. Moller-Maersk 2003 6,644 11 years 26,100 November 2019 26,100
27 MAERSK KINGSTON A.P. Moller-Maersk 2003 6,644 11 years 38,461(4) February 2020 26,161
28 MAERSK KALAMATA A.P. Moller-Maersk 2003 6,644 11 years 38,418(5) April 2020 26,533
29 VENETIKO   2003 5,928        
30 ENSENADA EXPRESS(*)   2001 5,576        
31 MSC ROMANOS MSC 2003 5,050 5.3 years 28,000 November 2016 28,000
32 ZIM NEW YORK ZIM 2002 4,992 14 years 14,534 September
2016(6)
14,534
33 ZIM SHANGHAI ZIM 2002 4,992 14 years 14,534 September
2016(6)
14,534
34 ZIM PIRAEUS ZIM 2004 4,992 10 years 12,500 July 2016 12,500
35 OAKLAND EXPRESS Hapag Lloyd 2000 4,890 8.0 years 30,500 September 2016 30,500
36 HALIFAX EXPRESS Hapag Lloyd 2000 4,890 8.0 years 30,500 October 2016 30,500
37 SINGAPORE EXPRESS Hapag Lloyd 2000 4,890 8.0 years 30,500 July 2016 30,500
38 MSC MANDRAKI MSC 1988 4,828 7.8 years 20,000 August 2017 20,000
39 MSC MYKONOS MSC 1988 4,828 8.2 years 20,000 September 2017 20,000
40 MSC ULSAN MSC 2002 4,132 5.3 years 16,500 March 2017 16,500
41 MSC KORONI MSC 1998 3,842 9.5 years 13,500(7) September 2018 13,500
42 ITEA Hapag-Lloyd 1998 3,842 0.1 years 6,250 May 2016 6,250
43 KARMEN Evergreen 1991 3,351 1.9 years 6,500 June 2016 7,250
44 MARINA Evergreen 1992 3,351 0.5 years 8,800 May 2016 8,800
45 LAKONIA Evergreen 2004 2,586 2.0 years 8,600 February 2017 8,600
46 ELAFONISOS(*) CMA CGM 1999 2,526 0.3 years 6,000 May 2016 6,000
47 AREOPOLIS Evergreen 2000 2,474 0.3 years 5,950 June 2016 5,950
48 MONEMVASIA(*)(iv) A.P. Moller-Maersk 1998 2,472 0.1 years 8,750 May 2016 8,750
49 MESSINI Evergreen 1997 2,458 3.3 years 6,000 August 2016 6,000
50 MSC REUNION MSC 1992 2,024 9.0 years 11,200(8) July 2017 8,019
51 MSC NAMIBIA II MSC 1991 2,023 9.8 years 11,200(9) July 2017 7,837
52 MSC SIERRA II MSC 1991 2,023 8.7 years 11,200(10) June 2017 7,569
53 MSC PYLOS MSC 1991 2,020 6.0 years 6,300 January 2017 6,300
54 PADMA(*) Yang Ming 1998 1,645 1.2 years 7,400(11) August 2016 7,256
55 NEAPOLIS(****)   2000 1,645        
56 ARKADIA(*) Evergreen 2001 1,550 2.0 years 10,600 August 2017 10,600
57 PROSPER(****)   1996 1,504        
58 ZAGORA MSC 1995 1,162 5.8 years 7,400(12) June 2017 6,321
59 PETALIDI(*) CMA CGM 1994 1,162 2.0 years 7,600 June 2016 7,600
60 STADT LUEBECK CMA CGM 2001 1,078 2.7 years 8,000(13) May 2016 8,000

Newbuilds

 
Vessel Name

Shipyard

Capacity (TEU)

Charterer
Expected Delivery(3)
1 NCP0113(*) Hanjin Subic Bay 11,010   Q2 2016
2 NCP0114(*) Hanjin Subic Bay 11,010   Q2 2016
3 NCP0115(*) Hanjin Subic Bay 11,010   Q3 2016
4 NCP0116(*) Hanjin Subic Bay 11,010   Q3 2016
5 NCP0152(*) Hanjin Subic Bay 11,010   Q1 2017
6 S2121(*) (***) Samsung Heavy 14,354 Evergreen Q2 2016
7 S2122(*) (***) Samsung Heavy 14,354 Evergreen Q2 2016
8 S2123(*) (***) Samsung Heavy 14,354 Evergreen Q3 2016
9 S2124(*) (***) Samsung Heavy 14,354 Evergreen Q3 2016
10 S2125(*) (***) Samsung Heavy 14,354 Evergreen Q4 2016
11 YZJ1206(*) (***) Jiangsu New Yangzi 3,800 Hamburg Süd Q1 2018
12 YZJ1207 (*) (***) Jiangsu New Yangzi 3,800 Hamburg Süd Q2 2018

(1) Charter terms and expiration dates are based on the earliest date charters could expire. Amounts set out for current daily charter rate are the amounts contained in the charter contracts. 
(2) This average rate is calculated based on contracted charter rates for the days remaining between April 20, 2016 and the earliest expiration of each charter. Certain of our charter rates change until their earliest expiration dates, as indicated in the footnotes below. 
(3) Based on latest shipyard production schedule, subject to change. 
(4) This charter rate changes on April 28, 2016 to $26,100 per day until the earliest redelivery date. 
(5) This charter rate changes on June 11, 2016 to $26,100 per day until the earliest redelivery date. 
(6) The amounts in the table reflect the current charter terms, giving effect to our agreement with Zim under the 2014 restructuring plan. Based on this agreement, we have been granted charter extensions and have been issued equity securities representing 1.2% of Zim's equity and approximately $8.2 million in interest bearing notes maturing in 2023. In July the Company exercised its option to extend the charters of Zim New York and Zim Shanghai for one year pursuant to its option to extend the charter of two of the three vessels chartered to Zim for successive one year periods at market rate plus $1,100 per day per vessel while the notes remain outstanding. The rate for the first year has been determined at $14,534 per day. 
(7) As from December 1, 2012 until redelivery, the charter rate is to be a minimum of $13,500 per day plus 50% of the difference between the market rate and the charter rate of $13,500. The market rate is to be determined annually based on the Hamburg ConTex type 3500 TEU index published on October 1 of each year until redelivery. 
(8) This charter rate changes on August 27, 2016 to $6,800 per day until the earliest redelivery date. 
(9) This charter rate changes on August 2, 2016 to $6,800 per day until the earliest redelivery date. 
(10) This charter rate changes on July 1, 2016 to $6,800 per day until the earliest redelivery date. 
(11) This charter rate changes on April 26, 2016 to $7,250 per day until the earliest redelivery date. 
(12) This charter rate changes on June 1, 2016 to $6,200 per day until the earliest redelivery date. 
(13) The charter rate will be $8,000 per day provided that the vessel trades within the Red Sea once every 20 days, while it will change to $7,400 for non-Red Sea trading. As of April 20, 2016, the vessel was earning $8,000 per day.

(i) Assumes exercise of owner's unilateral options to extend the charter of these vessels for two one year periods at the same charter rate. The charterer also has corresponding options to unilaterally extend the charter for the same periods at the same charter rate. 
(ii) The charterer has a unilateral option to extend the charter of the vessel for a period of 12 months. 
(iii) The charterer has a unilateral option to extend the charter of the vessel for two periods of 30 months each +/-90 days on the final period performed, at a rate of $41,700 per day. 
(iv) We have entered into a five year charter agreement with Maersk upon the expiry of the current charter agreement, at a rate of $9,250 daily.

(*) Denotes vessels acquired pursuant to the Framework Deed with York. The Company holds an equity interest ranging between 25% and 49% in each of the vessel-owning entities.
(**) Denotes vessels subject to the sale and leaseback transaction with CLC.
(***) Denotes vessels acquired pursuant to the Framework Deed which are subject to sale and leaseback transactions with Chinese financial institutions.
(****) These vessels are currently undergoing repairs.

 
 
COSTAMARE INC.
Consolidated Statements of Income
 
  Three-months ended March 31,  
(Expressed in thousands of U.S. dollars, except share and per share amounts) 2015     2016  
  (Unaudited)  
       
               
REVENUES:              
Voyage revenue $ 120,850     $ 120,274  
               
EXPENSES:              
Voyage expenses   (636 )     (572 )
Voyage expenses - related parties   (905 )     (902 )
Vessels' operating expenses   (29,551 )     (26,991 )
General and administrative expenses   (1,315 )     (1,226 )
Management fees - related parties   (4,818 )     (4,785 )
General and administrative expenses - non-cash component   (2,634 )     (1,344 )
Amortization of dry-docking and special survey costs   (1,825 )     (1,934 )
Depreciation   (25,066 )     (25,281 )
Amortization of prepaid lease rentals   (1,228 )     (1,238 )
Foreign exchange gains/ (losses)   290       (124 )
Operating income $ 53,162     $ 55,877  
               
OTHER INCOME (EXPENSES):              
Interest income $ 438     $ 361  
Interest and finance costs   (27,943 )     (18,906 )
Equity loss on investments   (195 )     (207 )
Other   278       498  
Gain / (Loss) on derivative instruments   544       (2,627 )
Total other income (expenses) $ (26,878 )   $ (20,881 )
Net Income $ 26,284     $ 34,996  
Earnings allocated to Preferred Stock   (3,010 )     (5,207 )
Net Income available to common stockholders $ 23,274     $ 29,789  
               
Earnings per common share, basic and diluted $ 0.31     $ 0.40  
Weighted average number of shares, basic and diluted   74,801,662       75,400,044  
               
               
COSTAMARE INC.
Consolidated Balance Sheets
 
  As of December 31,     As of March 31,  
(Expressed in thousands of U.S. dollars) 2015     2016  
  (Unaudited)  
ASSETS              
CURRENT ASSETS:              
Cash and cash equivalents $ 100,105     $ 81,199  
Restricted cash   14,007       6,001  
Accounts receivable   1,111       901  
Inventories   10,578       10,820  
Due from related parties   6,012       2,370  
Fair value of derivatives   352       800  
Insurance claims receivable   3,906       4,274  
Prepaid lease rentals   4,982       4,971  
Accrued charter revenue   457       456  
Prepayments and other   3,546       3,985  
Total current assets $ 145,056     $ 115,777  
FIXED ASSETS, NET:              
Capital leased assets $ 242,966     $ 241,081  
Vessels, net   2,004,650       1,981,844  
Total fixed assets, net $ 2,247,616     $ 2,222,925  
NON-CURRENT ASSETS:              
Investment in affiliates $ 117,931     $ 124,233  
Prepaid lease rentals, non-current   35,829       34,602  
Deferred charges, net   22,809       23,084  
Accounts receivable, non-current   1,425       1,425  
Restricted cash   48,708       47,159  
Accrued charter revenue   569       493  
Other non-current assets   12,612       12,663  
Total assets $ 2,632,555     $ 2,582,361  
LIABILITIES AND STOCKHOLDERS' EQUITY              
CURRENT LIABILITIES:              
Current portion of long-term debt (*) $ 183,828     $ 183,801  
Accounts payable   4,047       4,944  
Due to related parties   371       242  
Capital lease obligations (*)   14,307       14,540  
Accrued liabilities   15,225       13,446  
Unearned revenue   18,356       14,292  
Fair value of derivatives   32,462       29,565  
Other current liabilities   1,712       1,753  
Total current liabilities $ 270,308     $ 262,583  
NON-CURRENT LIABILITIES              
Long-term debt, net of current portion (*) $ 1,134,764     $ 1,086,995  
Capital lease obligations, net of current portion (*)   217,810       214,103  
Fair value of derivatives, net of current portion   19,655       25,160  
Unearned revenue, net of current portion   26,508       25,925  
Total non-current liabilities $ 1,398,737     $ 1,352,183  
COMMITMENTS AND CONTINGENCIES              
STOCKHOLDERS' EQUITY:              
Preferred stock $ -     $ -  
Common stock   8       8  
Additional paid-in capital   963,904       965,248  
Retained earnings   44,247       52,111  
Accumulated other comprehensive loss   (44,649 )     (49,772 )
Total stockholders' equity $ 963,510     $ 967,595  
Total liabilities and stockholders' equity $ 2,632,555     $ 2,582,361  

(*) Amounts net of deferred financing costs

Contact Information

  • Company Contacts:

    Gregory Zikos
    Chief Financial Officer

    Konstantinos Tsakalidis
    Business Development

    Costamare Inc., Monaco
    Tel: Tel: (+377) 93 25 09 40
    Email: ir@costamare.com