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Navios Maritime Acquisition fleet enjoys profitable charter rates

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Attractive charter periods

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Maritime Acquisition (NNA), says that the strong increase in tanker rates is allowing the company to secure attractive contract periods for its fleet of charters. NMM has chartered out one VLCC (very large crude carrier) for a one-year period at what it believes is the highest VLCC rate since 2010. As well, Navios is maintaining its spot market exposure, currently at $76,645 per day, by chartering out another VLCC on an index-linked contract. Frangou says, “We will continue to charter out our fleet while lengthening our charter periods as the market allows.”

These rising tanker rates also benefit companies including Teekay Tankers (TNK), Tsakos Energy Navigation (TNP), Scorpio Tankers (STNG), and Capital Product Partners (CPLP).

The PowerShares DB Oil Fund ETF (DBO) tracks the performance of crude oil.

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Chartering VLCCs

Navios Acquisition chartered out Nave Synergy, a VLCC, to a high-quality counterparty for one year at a rate of $34,125 net per day. The vessel is expected to generate approximately $8.6 million of aggregate EBITDA (earnings before interest, taxes, depreciation, and amortization) during this charter. That’s assuming 360 revenue days with operating expenses approximating current costs.

Another VLCC, Nave Neutrino, was chartered out to a high-quality counterparty for nine months at a rate based on an adjusted Baltic international tanker routes, or BITR, TD3 index. In this case, the charter includes an option for an additional nine-month period. The adjusted BITR TD3 is currently $76,645 per day.

Chartering of product tankers

Navios Acquisition’ vessel, Nave Sextans, an MR2 product tanker, was chartered out to a high-quality counterparty for three years. The vessel, chartered at a rate of $16,294 net per day, is expected to generate approximately $3.5 million of annual EBITDA and approximately $10.5 million of aggregate EBITDA for the entire charter period. That’s assuming 360 revenue days with operating expenses approximating current costs.

Another MR2 product tanker, Nave Alderamin, was chartered out to a high-quality counterparty for two years at $15,600 net per day. The vessel is expected to generate annual EBITDA of $3.2 million and approximately $6.5 million of aggregate EBITDA for the entire charter period. That’s assuming 360 revenue days with operating expenses approximating current costs.

Meanwhile, the Nave Capella‘s employment has been extended for six months at an increased rate of $14,813 net per day with an option for an additional six-month period for $16,664 net per day.

The profit it’s making off chartering its vessels puts Navios Acquisition in an advantageous position and secures a stable cash-flow base for its future. This is likely to contribute to the company’s top line, and it should also generate attractive returns for shareholders.

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