SOURCE: Navios Maritime Holdings, Inc.

Navios Maritime Holdings, Inc.

August 22, 2011 07:26 ET

Navios Maritime Holdings Inc. Reports Financial Results for the Second Quarter and Six Months Ended June 30, 2011

Dividend of $0.06 per Share for Q2 2011

9.1% Increase in Q2 Net Income to $50.9 Million

8.7% Increase in Basic EPS of $0.50 for Q2 2011

13.9% Increase in Q2 EBITDA to $103.7 Million

PIRAEUS, GREECE--(Marketwire - Aug 22, 2011) - Navios Maritime Holdings Inc. ("Navios Holdings") (NYSE: NM), a global, vertically integrated seaborne shipping and logistics company, today reported financial results for the second quarter and six months ended June 30, 2011.

Ms. Angeliki Frangou, Chairman and CEO of Navios, stated, "We are pleased to report an increase in EBITDA of 14%, to $104 million, and net income by more than 9%, to almost $51 million. Given our strong cash flow, we declared a $0.06 dividend for Q2 2011."

Ms. Frangou continued, "Our 43 vessel fleet has long-term charters which are insured through a AA+ European entity. Our business can prosper in a prolonged downturn given this significant cash flow, as well as ample liquidity, conservative leverage ratios and absence of material near-term capital requirements."

HIGHLIGHTS -- RECENT DEVELOPMENTS

Navios Holdings

Liquidity
Net Debt to Total Capitalization was 44.7% on June 30, 2011. Navios Holdings' total available liquidity, including credit lines, as of June 30, 2011 was approximately $412.6 million. As of August 22, 2011, Navios Holdings' remaining newbuilding vessel capital expenditures commitments amounted to approximately $1.8 million.

Purchase Options
On May 30, 2011, Navios Holdings entered into option agreements to acquire four 82,000 dwt bulk carriers. Upon exercise of the options, delivery of the vessels is expected sometime during the second half of 2013 or the first half of 2014. The contract price for each vessel is $35.0 million.

Vessel Acquisition
On May 30, 2011, Navios Holdings agreed to acquire a 81,600 dwt bulk carrier scheduled to be delivered in April 2012 from a South Korean shipyard. The aggregate purchase price for the new vessel is approximately $35.5 million to be funded with a credit facility of up to $23.0 million.

Time Charter Coverage
Navios Holdings has long-term fleet employment for periods up to 12 years. As of August 19, 2011, Navios Holdings had chartered-out 95.2%, 55.9% and 37.9% of available days for 2011, 2012 and 2013, respectively, equivalent to $305.8 million, $216.8 million and $168.8 million in revenue, respectively. The average daily charter-out rate for the core fleet is $25,824, $28,874 and $32,415 for 2011, 2012 and 2013, respectively. The average daily charter-in rate for the active long-term charter-in vessels for 2011 is $10,479.

The above figures do not include the fleet of Navios South American Logistics Inc. ("Navios Logistics") and vessels servicing Contracts of Affreightment ("COA").

Navios Logistics

Acquisitions
During the second quarter and as of August 19, 2011, Navios Logistics used a portion of the proceeds from its offering of senior unsecured notes due 2019 to acquire three pushboats, 66 dry barges and one floating drydock for a cost of approximately $44.0 million, including transportation and other related costs.

On July 25, 2011, Navios Logistics acquired the noncontrolling interests of its joint ventures Thalassa Energy S.A., HS Tankers Inc., HS Navigation Inc., HS Shipping Ltd. Inc. and HS South Inc., in accordance with the terms of certain stock purchase agreements with HS Energy Ltd., an affiliate of Vitol S.A. Navios Logistics paid a total consideration of $8.5 million for such noncontrolling interests, and simultaneously paid $53.2 million in full and final settlement of all amounts of indebtedness of such joint ventures under certain loan agreements.

Navios Maritime Partners L.P. ("Navios Partners")
On August 10, 2011, Navios Holdings received $6.7 million representing the cash distribution from Navios Partners for the second quarter of 2011.

Fleet Profile

Navios Holdings controls a fleet of 56 vessels totaling 5.9 million dwt, of which 29 are owned and 27 are chartered-in under long-term charters. Navios Holdings currently operates 43 vessels (17 Capesize, nine Panamax, 16 Ultra-Handymax and one Handysize) totaling 4.6 million dwt. Additionally, Navios Holdings has agreed to acquire one newbuilding Panamax vessel expected to be delivered in April 2012 and has 12 newbuilding charter-in vessels expected to be delivered at various dates through 2013 (the "Core Fleet"). Also, as discussed above, Navios Holdings has entered into option agreements to acquire four newbuilding Panamax vessels. The current average age of the operating fleet is 5.0 years.

Exhibit II provides certain details of the "Core Fleet" of Navios Holdings. It does not include the fleet of Navios Logistics.

Dividend Policy

The Board of Directors declared a quarterly cash dividend for the second quarter of 2011 of $0.06 per share of common stock. The dividend is payable on October 6, 2011 to stockholders of record as of September 22, 2011. The declaration and payment of any further dividend remain subject to the discretion of the Board and will depend on, among other things, Navios Holdings' cash requirements after taking into account market opportunities, restrictions under its credit agreements and other debt obligations and such other factors as the Board may deem advisable.

Financial Highlights

  • Net income increased by 9.1% to $50.9 million in the second quarter of 2011 from $46.6 million for the same period in 2010.
  • EBITDA increased by 13.9% to $103.7 million in the second quarter of 2011 from $91.0 million for the same period in 2010.
  • Net Debt to Total Capitalization was 44.7% on June 30, 2011.

Second Quarter 2011 and 2010 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The quarterly 2011 and 2010 information presented below was derived from the unaudited condensed consolidated financial statements for the respective periods. EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are non-U.S. GAAP financial measures, and should not be used in isolation or as substitution for Navios Holdings' results.

From March 30, 2011, Navios Maritime Acquisition Corporation ("Navios Acquisition") is no longer consolidated and is accounted for under the equity method of accounting. The table and the discussion below exclude the impact of Navios Acquisition and are presented to provide investors with a clearer picture of Navios Holdings on a going forward basis.

(Excluding consolidation of Navios Acquisition)
Three Months Ended Three Months Ended
June 30, June 30,
2011 2010
(unaudited) (unaudited)
Revenue $ 165,353 $ 165,419
EBITDA $ 103,690 $ 91,004
Adjusted EBITDA (*) $ 64,903 $ 71,511
Net Income $ 50,850 $ 46,591
Adjusted Net Income (*) $ 12,063 $ 27,098
Earnings Per Share $ 0.50 $ 0.46
Adjusted Basic Earnings Per Share (*) $ 0.12 $ 0.26
(*) Each of Adjusted EBITDA, Adjusted Net Income and Adjusted Basic Earnings Per Share for the three months ended June 30, 2011 excludes a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners.

Each of Adjusted EBITDA, Adjusted Net Income and Adjusted Basic Earnings Per Share for the three months ended June 30, 2010 excludes (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; and (ii) a $1.8 million gain on the sale of the Navios Pollux to Navios Partners.

Navios Holdings' total consolidated revenue for the three months ended June 30, 2011 and 2010 was $165.4 million.

Revenue from drybulk vessel operations for the three months ended June 30, 2011 was $110.7 million as compared to $113.8 million for the same period during 2010. The decrease in drybulk revenue was mainly attributable to (i) a decrease in short-term charter-in and long-term charter-in fleet available days by 30 days and 296 days, respectively, and (ii) a decrease in Time Charter Equivalent ("TCE") per day by 10.4% to $23,681 per day in the second quarter of 2011 from $26,431 per day in the same period of 2010. This decrease was partially offset by an increase in available days for owned vessels by 25.8% to 2,635 days in the first quarter of 2011 from 2,094 days in the same period of 2010.

Revenue from the logistics business was $54.7 million for the three months ended June 30, 2011 as compared to $51.6 million for the same period of 2010. This increase was mainly attributable to: (i) the delivery of the Jiujiang and the Stavroula in June and July 2010, respectively; and (ii) improved performance in iron ore transportation. This increase was partially offset by a decrease in revenues from operations of its dry and liquid ports.

EBITDA of Navios Holdings for the three months ended June 30, 2011 increased by $12.7 million to $103.7 million as compared to $91.0 million for the same period of 2010. EBITDA of Navios Holdings for the three month period ended June 30, 2011 was adjusted for a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners, and for the same period of 2010 was adjusted to exclude (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; and (ii) a $1.8 million gain on sale of Navios Pollux to Navios Partners. As a result of these adjustments, the Adjusted EBITDA of Navios Holdings for the three months ended June 30, 2011 decreased by $6.6 million to $64.9 million as compared to $71.5 million for the same period of 2010. The $6.6 million decrease in Adjusted EBITDA was primarily due to: (i) an increase in direct vessel expenses (excluding the amortization of deferred dry dock and special survey costs) of $10.0 million; (ii) an increase in general and administrative expenses of $2.2 million (excluding share-based compensation expenses); (iii) a $5.6 million decrease in gains from derivatives; (iv) a decrease in equity in earnings by $0.4 million. The overall variance of $18.2 was partially offset by: (i) a decrease in time charter, voyage and port terminal expenses of $9.6 million; (ii) a decrease of $1.7 million in loss attributable to the noncontrolling interest; and (iii) a decrease of $0.3 million in net other expense.

EBITDA of Navios Logistics was $10.5 million for the three month period ended June 30, 2011 as compared to $10.3 million for the same period in 2010.

Navios Acquisition's effect to EBITDA was a loss of $0.8 million for the three month period ended June 30, 2011, and for the same period of 2010 was below $0.1 million.

See Exhibit I under the heading "Disclosure of Non-GAAP Financial Measures" for a discussion of EBITDA and Adjusted EBITDA of Navios Holdings, on a consolidated basis, Navios Acquisition and Navios Logistics, and a reconciliation of such measures to the most comparable measure under U.S. GAAP.

Net income of Navios Holdings for the three months ended June 30, 2011 was $50.9 million as compared to $46.6 million for the same period of 2010. Net income of Navios Holdings for the three months ended June 30, 2011 was adjusted to exclude a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners, and for the same period of 2010, was adjusted for (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; and (ii) a $1.8 million gain on sale of Navios Pollux to Navios Partners. As a result of these adjustments, the Adjusted Net Income of Navios Holdings for the three months ended June 30, 2011 was $12.1 million as compared to $27.1 million for the same period of 2010. The decrease of Adjusted Net Income by $15.0 million was mainly due to (i) a decrease in Adjusted EBITDA of $6.6 million as discussed above; (ii) an increase in interest income/expense and finance cost, net of $4.2 million; (iii) an increase in depreciation and amortization of $2.0 million; (iv) an increase of $0.5 million in amortization for drydock and special survey costs; (v) an increase of $0.5 million in share-based compensation expense; and (vi) an increase in income taxes of $1.2 million.

First Half of 2011 and 2010 Results (in thousands of U.S. dollars, except per share data and unless otherwise stated):

The information for the six month period ended June 30, 2011 and 2010 presented below was derived from the unaudited condensed consolidated financial statements for the respective periods. EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are non-U.S. GAAP financial measures, and should not be used in isolation or as substitution for Navios Holdings' results.

From March 30, 2011, Navios Acquisition is no longer consolidated and is accounted for under the equity method of accounting. The table and the discussion below exclude the impact of Navios Acquisition and are presented to provide investors with a clearer picture of Navios Holdings on a going forward basis.

(Excluding consolidation of Navios Acquisition) (Excluding consolidation of Navios Acquisition)
Six Months Ended Six Months Ended
June 30, June 30,
2011 2010
(unaudited) (unaudited)
Revenue $ 321,995 $ 319,788
EBITDA $ 114,682 $ 169,054
Adjusted EBITDA (*) $ 132,419 $ 129,200
Net income $ 14,161 $ 77,892
Adjusted Net Income (*) $ 31,898 $ 38,038
Earnings Per Share $ 0.13 $ 0.77
Adjusted Basic Earnings Per Share (*) $ 0.31 $ 0.37
(*) Each of Adjusted EBITDA, Adjusted Net Income and Adjusted Basic Earnings Per Share for the six months ended June 30, 2011 excludes: (i) a $21.2 million of expenses relating to the bond extinguishment in January 2011; (ii) a $35.3 million loss on change in control from the Navios Acquisition deconsolidation; and (iii) a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners.

Each of Adjusted EBITDA, Adjusted Net Income and Adjusted Basic Earnings Per Share for the six months ended June 30, 2010 excludes: (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; (ii) a $26.1 million gain on the sale of the Navios Hyperion, the Navios Aurora II and the Navios Pollux to Navios Partners; and (iii) a $4.0 million write off of an unfavorable short term charter.

Navios Holdings' total consolidated revenue for the six months ended June 30, 2011 increased by $2.2 million to $322.0 million as compared to $319.8 million for the same period during 2010.

Revenue from drybulk vessel operations for the six months ended June 30, 2011 was $222.9 million as compared to $232.0 million for the same period during 2010. The decrease in drybulk revenue was mainly attributable to (i) a decrease in short-term charter-in and long-term charter-in fleet available days by 205 days and 740 days, respectively and (ii) a decrease in TCE per day by 5.0% to $24,143 per day in the first half of 2011 from $25,424 per day in the same period of 2010. This decrease was partially offset by an increase in available days for owned vessels by 22.5% to 5,159 days in the first half of 2011 from 4,212 days in the same period of 2010.

Revenue from the logistics business was $99.1 million for the six months ended June 30, 2011 as compared to $87.8 million for the same period of 2010. This increase was mainly attributable to: (i) the delivery of the Jiujiang and the Stavroula in June and July 2010, respectively; and (ii) improved performance in iron ore transportation. This increase was partially offset by decrease in operations of its dry and liquid ports.

EBITDA of Navios Holdings for the six months ended June 30, 2011 decreased by $54.4 million to $114.7 million as compared to $169.1 million for the same period of 2010. EBITDA of Navios Holdings for the six month period ended June 30, 2011 was adjusted for (i) a $21.2 million of expenses relating to the bond extinguishment in January 2011; (ii) a $35.3 million loss on change in control from the Navios Acquisition deconsolidation; and (iii) a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners, and for the same period of 2010 was adjusted to exclude (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; (ii) a $26.1 million gain on the sale of the Navios Hyperion, the Navios Aurora II and the Navios Pollux to Navios Partners; and (iii) a $4.0 million write off of an unfavorable short term charter. As a result of these adjustments, the Adjusted EBITDA of Navios Holdings for the six months ended June 30, 2011 increased by $3.2 million to $132.4 million as compared to $129.2 million for the same period of 2010. The $3.2 million increase in Adjusted EBITDA was primarily due to: (i) an increase in revenue of $2.2 million to $322.0 million in the first half of 2011 from $319.8 million in the same period of 2010; (ii) a decrease in time charter, voyage and port terminal expenses of $27.4 million; and (iii) a decrease of $ 3.3 million in net other expense. The overall variance of $32.9 million was partially offset by: (i) an increase in direct vessel expenses (excluding the amortization of deferred dry dock and special survey costs) of $15.8 million; (ii) an increase in general and administrative expenses of $1.4 million (excluding share-based compensation expenses); (iii) a $4.1 million increase in losses from derivatives; (iv) a increase of $0.7 million in loss attributable to the noncontrolling interest; (v) a decrease in equity in earnings by $3.7 million; and (vi) a $4.0 million write-off relating to the termination of an unfavorable short-term charter contract that took place during the same period in 2010.

EBITDA of Navios Logistics was $20.0 million for the six month period ended June 30, 2011 as compared to $14.4 million during the same period in 2010.

Navios Acquisition's effect to EBITDA for the six month period ended June 30, 2011 was $14.1 million and for the same period of 2010 was below $0.1 million.

See Exhibit I under the heading "Disclosure of Non-GAAP Financial Measures" for a discussion of EBITDA and Adjusted EBITDA of Navios Holdings, on a consolidated basis, Navios Acquisition and Navios Logistics, and a reconciliation of such measures to the most comparable measure under U.S. GAAP.

Net income of Navios Holdings for the six months ended June 30, 2011 was $14.2 million as compared to $77.9 million for the same period of 2010. Net income of Navios Holdings for the six months ended June 30, 2011 was adjusted to exclude (i) $21.2 million of expenses relating to the bond extinguishment in January 2011; (ii) a $35.3 million loss on change in control from the Navios Acquisition deconsolidation; and (iii) a $38.8 million gain on the sale of the Navios Luz and the Navios Orbiter to Navios Partners, and for the same period of 2010, was adjusted for (i) a $17.7 million gain recognized as a result of the initial consolidation of Navios Acquisition as of May 28, 2010; (ii) a $26.1 million gain on the sale of the Navios Hyperion, the Navios Aurora II and the Navios Pollux to Navios Partners and (iii) a $4.0 million write off of an unfavorable short term charter. As a result of these adjustments, the Adjusted Net Income of Navios Holdings for the six months ended June 30, 2011 was $31.9 million as compared to $38.0 million for the same period of 2010. The decrease of Adjusted Net Income by $6.1 million was mainly due to (i) an increase in interest income/expense, net of $3.9 million; (ii) an increase in depreciation and amortization of $2.4 million; (iii) an increase in income taxes of $1.1 million; (iv) an increase of $1.2 million in amortization for drydock and special survey costs; and (v) an increase of $0.7 million in share-based compensation expense. This decrease was partially offset by an increase in Adjusted EBITDA of $3.2 million.

Fleet Summary Data:

The following table reflects certain key indicators indicative of the performance of the Navios Holdings' drybulk operations and its fleet performance for the three month periods ended June 30, 2011 and 2010.

Three Month Period ended June 30, 2011 Three Month Period ended June 30, 2010 Six Month Period ended June 30, 2011 Six Month Period ended June 30, 2010
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Available Days (1) 4,129 3,915 8,111 8,108
Operating Days (2) 4,081 3,904 8,008 8,088
Fleet Utilization (3) 98.8 % 99.7 % 98.7 % 99.8 %
Equivalent Vessels (4) 45 43 45 45
TCE (5) $ 23,681 $ 26,431 $ 24,143 $ 25,424
(1) Available days for the fleet are total calendar days the vessels were in Navios Holdings' possession for the relevant period after subtracting off-hire days associated with major repairs, drydocking or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which vessels should be capable of generating revenues.
(2) Operating days are the number of available days in the relevant period less the aggregate number of days that the vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a relevant period during which vessels actually generate revenues.
(3) Fleet utilization is the percentage of time that Navios Holdings' vessels were available for generating revenue, and is determined by dividing the number of operating days during a relevant period by the number of available days during that period. The shipping industry uses fleet utilization to measure a company's efficiency in finding suitable employment for its vessels.
(4) Equivalent Vessels, is defined as the total available days during a relevant period divided by the number of days of this period.
(5) TCE is defined as voyage and time charter revenues less voyage expenses during a relevant period divided by the number of available days during the period.

Conference Call:
As previously announced, Navios Holdings will host a conference call today, August 22, 2011, at 8:30 am ET, at which time Navios Holdings' senior management will provide highlights and commentary on the financial results of the second quarter and six months ended June 30, 2011.

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

Conference Call details:
Call Date/Time: August 22, 2011, at 8:30 am ET
Call Title: Navios Holdings Q2 2011 Financial Results Conference Call
US Dial In: +1.877.480.3873
International Dial In: +1.404.665.9927
Conference ID: 8515 1892

The conference call replay will be available shortly after the live call and remain available for one week at the following numbers:
US Replay Dial In: +1.855.859.2056
International Replay Dial In: +1.404.537.3406
Conference ID: 8515 1892

This call will be simultaneously Webcast. The Webcast will be available on the Navios Holdings website, www.navios.com, under the "Investors" section. The Webcast will be archived and available at the same Web address for two weeks following the call.

About Navios Maritime Holdings Inc.
Navios Maritime Holdings Inc. (NYSE: NM) 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.

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

About Navios South American Logistics Inc.
Navios Logistics is one of the largest logistics companies in the Hidrovia region of South America, serving the storage and marine transportation needs of a diverse customer base of global petroleum, agricultural and mining companies. Through port terminal, river barge and coastal cabotage operations, the company is focused on providing its customers integrated transportation, storage and related services. For more information about Navios Logistics please visit its website: www.navios-logistics.com.

About Navios Maritime Partners L.P.
Navios Partners (NYSE: NMM) is a publicly traded master limited partnership which owns and operates dry cargo vessels. For more information, please visit its website: www.navios-mlp.com.

About Navios Maritime Acquisition Corporation
Navios Acquisition (NYSE: NNA) is an owner and operator of tanker vessels focusing in the transportation of petroleum products (clean and dirty) and bulk liquid chemicals. For more information about Navios Acquisition, please visit its website: www.navios-acquisition.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.

EXHIBIT I
NAVIOS MARITIME HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of U.S. dollars - except share data)
June 30, December 31,
2011 2010
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 342,354 $ 207,410
Restricted cash 19,097 34,790
Accounts receivable, net 94,359 70,388
Short-term derivative asset 1,208 1,420
Due from affiliate companies 30,208 2,603
Prepaid expenses and other current assets 33,935 33,354
Total current assets 521,161 349,965
Deposits for vessel acquisitions 1,511 377,524
Vessels, port terminal and other fixed assets, net 1,768,416 2,249,677
Long-term derivative assets 150 149
Restricted cash -- 18,787
Other long-term assets 62,611 60,132
Investments in affiliates 118,594 18,695
Investments in available for sale securities 102,963 99,078
Intangible assets other than goodwill 255,240 327,703
Goodwill 160,336 175,057
Total noncurrent assets 2,469,821 3,326,802
Total assets $ 2,990,982 $ 3,676,767
LIABILITIES AND EQUITY
Current liabilities
Accounts payable $ 44,570 $ 49,496
Dividends payable 6,100 7,214
Accrued expenses 77,228 62,417
Deferred income and cash received in advance 24,159 17,682
Short-term derivative liability -- 245
Current portion of capital lease obligations 16,341 1,252
Current portion of long-term debt 58,613 63,297
Total current liabilities 227,011 201,603
Senior and ship mortgage notes, net of discount 945,257 1,093,787
Long-term debt, net of current portion 500,992 918,826
Capital lease obligations, net of current portion 15,308 31,009
Unfavorable lease terms 47,976 56,875
Other long-term liabilities and deferred income 45,114 36,020
Deferred tax liability 20,844 21,104
Total noncurrent liabilities 1,575,491 2,157,621
Total liabilities 1,802,502 2,359,224
Commitments and contingencies -- --
Stockholders' equity
Preferred stock -- $0.0001 par value, authorized 1,000,000 shares, 8,479 issued and outstanding as of June 30, 2011 and December 31, 2010. -- --
Common stock -- $0.0001 par value, authorized 250,000,000 shares, issued and outstanding 101,686,343 and 101,563,766 as of June 30, 2011 and December 31, 2010, respectively. 10 10
Additional paid-in capital 533,679 531,265
Accumulated other comprehensive income 26,549 32,624
Retained earnings 495,348 495,684
Total Navios Holdings' stockholders' equity 1,055,586 1,059,583
Noncontrolling interest 132,894 257,960
Total stockholders'equity 1,188,480 1,317,543
Total liabilities and stockholders'equity $ 2,990,982 $ 3,676,767
NAVIOS MARITIME HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of U.S. dollars -- except share and per share data)
Three Month Three Month Six Month Six Month
Period Ended Period Ended Period Ended Period Ended
June 30, 2011 June 30, 2010 June 30, 2011 June 30, 2010
(unaudited) (unaudited) (unaudited) (unaudited)
Revenue $ 165,353 $ 165,445 $ 347,125 $ 319,814
Time charter, voyage and port terminal expenses (62,598 ) (72,230 ) (121,712 ) (148,731 )
Direct vessel expenses (31,657 ) (21,109 ) (65,675 ) (41,153 )
General and administrative expenses (13,911 ) (11,351 ) (26,685 ) (23,544 )
Depreciation and amortization (24,397 ) (22,366 ) (57,718 ) (47,307 )
Interest income/expense and finance cost, net (25,133 ) (20,982 ) (54,570 ) (42,391 )
Gain/(loss) on derivatives 303 5,880 (82 ) 4,042
Gain on sale of assets 38,787 1,751 38,787 26,134
Gain/(loss) on change in control -- 17,742 (35,325 ) 17,742
Loss on bond extinguishment -- -- (21,199 ) --
Other expense, net (2,565 ) (3,005 ) (3,540 ) (6,804 )
Income/(loss) before equity in net earnings of affiliate companies 44,182 39,775 (594 ) 57,802
Equity in net earnings of affiliated companies 7,731 8,172 14,746 19,756
Income before taxes $ 51,913 $ 47,947 $ 14,152 $ 77,558
Income taxes (1,085 ) 133 (181 ) 901
Net income 50,828 48,080 13,971 78,459
Less: Net loss/(income) attributable to the noncontrolling interest 22 (1,571 ) (1,251 ) (649 )
Preferred stock dividends of subsidiary -- -- (27 ) --
Add: Preferred stock dividends attributable to the noncontrolling interest -- -- 12 --
Net income attributable to Navios Holdings common stockholders $ 50,850 $ 46,509 $ 12,705 $ 77,810
Basic net earnings per share attributable to Navios Holdings common stockholders $ 0.50 $ 0.46 $ 0.12 $ 0.76
Weighted average number of shares, basic 100,949,505 100,470,187 100,901,279 100,447,992
Diluted net earnings per share attributable to Navios Holdings common stockholders $ 0.46 $ 0.41 $ 0.12 $ 0.69
Weighted average number of shares, diluted 110,327,472 114,550,664 110,318,726 114,313,472
NAVIOS MARITIME HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in thousands of U.S. dollars)
Six Month Six Month
Period Ended Period Ended
June 30, 2011 June 30, 2010
(unaudited) (unaudited)
OPERATING ACTIVITIES:
Net income $ 13,971 $ 78,459
Adjustments to reconcile net income to net cash provided by operating activities:
Non cash adjustments 72,812 19,050
Increase in operating assets (40,783 ) (18,613 )
Increase/(decrease) in operating liabilities 32,142 (17,238 )
Payments for drydock and special survey costs (4,990 ) (6,729 )
Net cash provided by operating activities 73,152 54,929
INVESTING ACTIVITIES:
Consolidation of subsidiary, net of cash assumed -- 3,125
Deconsolidation of Navios Acquisition (72,425 ) --
Decrease/(increase) in restricted cash for asset acquisitions 778 (67,250 )
Acquisition of General Partner units (2,052 ) (3,566 )
Acquisition of vessels (56,059 ) (69,808 )
Deposits for vessel acquisitions (4,499 ) (294,582 )
Receipts from finance lease -- 293
Proceeds from sale of assets 120,000 303,832
Purchase of property and equipment (32,274 ) (5,008 )
Net cash used in investing activities (46,531 ) (132,964 )
FINANCING ACTIVITIES:
Proceeds from long-term loan, net of deferred finance fees 54,613 228,798
Repayment of long-term debt (165,847 ) (86,717 )
Repayment of Senior Notes (300,000 ) --
Proceeds from issuance of Senior Notes, net of deferred finance fees 534,309 --
Dividends paid (14,182 ) (13,482 )
Issuance of common stock 415 275
Payments of obligations under capital leases (612 ) --
Increase in restricted cash (373 ) (2,250 )
Dividends to noncontrolling shareholders -- (470 )
Net cash provided by financing activities 108,323 126,154
Increase in cash and cash equivalents 134,944 48,119
Cash and cash equivalents, beginning of period 207,410 173,933
Cash and cash equivalents, end of period $ 342,354 $ 222,052
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest $ 33,059 $ 44,955
Cash paid for income taxes $ 832 $ 480
Non-cash investing and financing activities
For issuance of preferred stock in connection with the acquisition of vessels $ -- $ 12,201
Equity in net earnings of affiliated companies $ 14,746 $ 19,756
Dividends declared but not paid $ 6,100 $ 6,058

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. Adjusted EBITDA represents EBITDA excluding certain items as described under "Financial Highlights". EBITDA and Adjusted EBITDA are "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 the ability of Navios Holdings, Navios Acquisition and Navios Logistics 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.

The following tables provide a reconciliation of EBITDA, in the case of Navios Holdings on a consolidated basis, Navios Acquisition and Navios Logistics, and Adjusted EBITDA in the case of Navios Holdings on a consolidated basis (as defined in the notes to the tables):

Navios Holdings Reconciliation of EBITDA and Adjusted EBITDA to Cash from Operations

Three Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net cash provided by operating activities $ 18,219 $ 29,215
Net increase in operating assets 29,757 7,794
Net (increase)/decrease in operating liabilities (3,768 ) 12,300
Net interest cost 25,133 20,982
Deferred finance charges (1,895 ) (1,496 )
Provision for gains/(losses) on accounts receivable (112 ) (1,372 )
Unrealized loss on FFA derivatives, warrants and interest rate swaps and expenses related to bond extinguishment 532 1,933
Earnings in affiliates, net of dividends received (4,099 ) (1,353 )
Payments for drydock and special survey 1,114 5,066
Noncontrolling interest 22 (1,571 )
Gain on change in control -- 17,742
Gain on sale of assets 38,787 1,751
EBITDA $ 103,690 $ 90,991
Gain on sale of assets (38,787 ) (1,751 )
Gain on change in control -- (17,742 )
Adjusted EBITDA $ 64,903 $ 71,498

Navios Acquisition Reconciliation of EBITDA to Cash from Operations

Three Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net cash provided by operating activities $ -- $ 2,623
Net decrease in operating assets -- 81
Net decrease in operating liabilities -- (2,845 )
Net interest cost -- 66
Noncontrolling interest -- 62
EBITDA $ -- $ (13 )

Navios Logistics EBITDA Reconciliation to Net Income

Three Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net (loss)/income attributable to Navios Logistics shareholders $ (719 ) $ 3,648
Depreciation and amortization 4,962 5,634
Amortization of deferred drydock costs 150 90
Interest income/expense and finance cost, net 5,105 1,132
Income taxes 1,010 (202 )
EBITDA $ 10,508 $ 10,302

Navios Holdings Reconciliation of EBITDA and Adjusted EBITDA to Cash from Operations

Six Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net cash provided by operating activities $ 73,152 $ 54,929
Net increase in operating assets 40,783 18,613
Net (increase)/decrease in operating liabilities (32,142 ) 17,238
Net interest cost 54,570 42,391
Deferred finance charges (3,226 ) (3,110 )
Provision for losses on accounts receivable 3 (5,438 )
Unrealized loss on FFA derivatives, warrants and interest rate swaps and expenses related to bond extinguishment (5,304 ) (3,597 )
Earnings in affiliates, net of dividends received (5,402 ) (1,941 )
Payments for drydock and special survey 4,990 6,729
Noncontrolling interest (1,251 ) (649 )
Preferred stock dividends attributable to the noncontrolling interest 12 --
Preferred stock dividends of subsidiary (27 ) --
(Loss)/gain on change in control (35,325 ) 17,742
Gain on sale of assets 38,787 26,134
EBITDA $ 129,620 $ 169,041
Gain on sale of assets (38,787 ) (26,134 )
Loss on bond extinguishment 21,199 --
Write-off due of unfavourable short term charter contract -- 4,022
(Loss)/gain on change in control 35,325 (17,742 )
Adjusted EBITDA $ 147,357 $ 129,187

Navios Acquisition Reconciliation of EBITDA to Cash from Operations

Six Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net cash provided by operating activities $ 18,749 $ 2,623
Net (decrease)/increase in operating assets (4,117 ) 81
Net increase in operating liabilities (6,613 ) (2,845 )
Net interest cost 8,349 66
Deferred finance charges (318 ) --
Earnings in affiliates, net of dividends received (1,300 ) --
Noncontrolling interest 188 62
EBITDA $ 14,938 $ (13 )

Navios Logistics EBITDA Reconciliation to Net Income

Six Months Ended
(in thousands of U.S. dollars)
June 30,
2011
June 30,
2010
(unaudited) (unaudited)
Net income attributable to Navios Logistics shareholders $ 2,510 $ 1,868
Depreciation and amortization 11,078 11,342
Amortization of deferred drydock costs 261 169
Interest income/expense and finance cost, net 6,159 2,040
Income taxes 33 (1,044 )
EBITDA $ 20,041 $ 14,375
EXHIBIT II
Owned Vessels
Vessel Name Vessel Type Year Built Deadweight
(in metric tons)
Navios Ionian Ultra Handymax 2000 52,067
Navios Vector Ultra Handymax 2002 50,296
Navios Horizon Ultra Handymax 2001 50,346
Navios Herakles Ultra Handymax 2001 52,061
Navios Achilles Ultra Handymax 2001 52,063
Navios Meridian Ultra Handymax 2002 50,316
Navios Mercator Ultra Handymax 2002 53,553
Navios Arc Ultra Handymax 2003 53,514
Navios Hios Ultra Handymax 2003 55,180
Navios Kypros Ultra Handymax 2003 55,222
Navios Ulysses Ultra Handymax 2007 55,728
Navios Vega Ultra Handymax 2009 58,792
Navios Celestial Ultra Handymax 2009 58,063
Navios Astra Ultra Handymax 2006 53,468
Navios Magellan Panamax 2000 74,333
Navios Star Panamax 2002 76,662
Navios Asteriks Panamax 2005 76,801
Navios Bonavis Capesize 2009 180,022
Navios Happiness Capesize 2009 180,022
Navios Lumen Capesize 2009 180,661
Navios Stellar Capesize 2009 169,001
Navios Phoenix Capesize 2009 180,242
Navios Antares Capesize 2010 169,059
Navios Buena Ventura Capesize 2010 179,132
Navios Etoile Capesize 2010 179,234
Navios Bonheur Capesize 2010 179,259
Navios Altamira Capesize 2011 179,165
Navios Azimuth Capesize 2011 179,169

Owned Vessels to be Delivered

Delivery
Vessel Type Date DWT
Navios TBN Panamax 04/2012 81,600

Options to Acquire Vessels

Delivery
Vessels Type Date DWT
Navios TBN Panamax H2/2013 82,000
Navios TBN Panamax H2/2013 82,000
Navios TBN Panamax H1/2014 82,000
Navios TBN Panamax H1/2014 82,000

Long term Chartered-in Fleet in Operation

Vessel Name Vessel Type Year Built Deadweight (in metric tons) Purchase Option(1)
Navios Primavera Ultra Handymax 2007 53,464 Yes
Navios Armonia Ultra Handymax 2008 55,100 No
Navios Serenity Handysize 2011 34,718 Yes
Navios Orion Panamax 2005 76,602 No
Navios Titan Panamax 2005 82,936 No
Navios Altair Panamax 2006 83,001 No
Navios Esperanza Panamax 2007 75,200 No
Torm Antwerp Panamax 2008 75,250 No
Golden Heiwa Panamax 2007 76,662 No
King Ore Capesize 2010 176,800 No
Beaufiks Capesize 2004 180,181 Yes
Phoenix Beauty Capesize 2010 169,150 No
Rubena N Capesize 2006 203,233 No
Formosabulk Brave Capesize 2001 170,000 No
SC Lotta Capesize 2009 170,500 No

Long-term Chartered-in Fleet to be Delivered

Vessels Vessel Type Delivery Date Purchase Option Deadweight (in metric tons)
Navios TBN Handysize 09/2012 Yes (2) 34,718
Navios Koyo Capesize 12/2011 Yes 181,000
Kleimar TBN Capesize 07/2012 Yes 180,000
Navios TBN Capesize 12/2013 Yes 180,000
Navios TBN Ultra Handymax 02/2012 Yes 61,000
Navios TBN Ultra Handymax 05/2013 Yes 61,000
Navios TBN Ultra Handymax 10/2013 Yes 61,000
Navios Marco Polo Panamax 12/2011 Yes 80,000
Navios TBN Panamax 01/2013 Yes 82,100
Navios TBN Panamax 07/2013 Yes (2) 80,500
Navios TBN Panamax 09/2013 Yes (2) 80,500
Navios TBN Panamax 11/2013 Yes (2) 80,500
(1) Generally, Navios Holdings may exercise its purchase option after three to five years of service.
(2) The initial 50% purchase option on each vessel is held by Navios Holdings.

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