Costamare - Earnings Call - Q1 2025

Transcript

Operator (participant)

Thank you for standing by, ladies and gentlemen, and welcome to the Costamare Inc Conference Call on the First Quarter 2025 Financial Results. We have with us Mr. Gregory Zikos, Chief Financial Officer of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session, at which time, if you wish to ask a question, please press star one on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today, Thursday, May 8th, 2025. We would like to remind you that this conference call contains forward-looking statements. Please take a moment to read slide number two of the presentation, which contains the forward-looking statements. I will now pass the floor to your speaker today, Mr. Zikos. Please go ahead, sir.

Gregory Zikos (CFO)

Thank you, and good morning, ladies and gentlemen. During the first quarter of the year, the company generated net income of about $95 million. As announced on May 7th, we have successfully completed the spin-off of Costamare Bulkers, which encompasses the 37 owned rival investors, as well as the CBI operating platform. Costamare remains the sole shareholder of the 68 containerships, as well as the controlling shareholder of Neptune Maritime Leasing. This business separation unlocks hidden value and better positions the two separately listed companies to pursue distinct operating and strategic initiatives in the containership and the dry bulk sector. Regarding the containership market, while geopolitical challenges and economic uncertainties impact global trade, demand for containership investors has had to now maintain momentum. The commercially idle fleet remains below 1%, indicating a fully employed market.

Regarding the proposed USTR fees, fleet redeployments and network reorganizations may initially result in efficiencies, boosting commerce demand. Our containership fleet employment stands at 100% and 73% for 2025 and 2026, respectively. Total contracted revenues amount to $2.3 billion, with the remaining time-chartered duration of 3.3 years. For the dry bulk sector, both Capesize and Panamax markets experienced a challenging start of the year. The Cape market rebounded strongly in March, supported by improved Australian and Brazilian iron ore shipments and tighter vessel availability. The Panamax activity picked up, as expected, post-Chinese New Year, supported by recovering grain flows. Finally, with regards to Neptune Maritime Leasing, the leasing platform, total investments and commitments are exceeding $530 million, with a healthy pipeline. Moving now to the slides presentation. On slide three, you can see our first quarter results.

Net income for the quarter was $95 million, or $0.79 per share. Adjusted net income was $73 million, or $0.61 per share. Our liquidity stands at about $1 billion. Slide four, we have completed successfully the spin-off of our dry bulk business. Every Costamare shareholder will be receiving as dividend one share of Costamare Bulkers for every five shares of Costamare. Turning to the containership side, our revenue stays unfixed, as already mentioned, 100% for 2025 and 73% for 2026, while our contracted revenues are $2.3 billion, with a TEU weighted remaining time-charter duration of about 3.3 years. Slide five, regarding our S&P activity for the span of dry business, we have concluded the sale of one Panamax ship and agreed to sell one Handysize vessel. Vessel proceeds are expected to be used for the acquisition of larger vessels subject to market conditions.

Slide six, regarding our financing arrangements, we have refinanced one containership vessel with no increased leverage, but with a maturity extension. The remaining company has no major maturities till 2027. On the dry bulk side, we have repaid circa $650 million of bank debt, and we have entered into a new handy-lease facility of up to $100 million for financing of future acquisitions. Moving to slide seven, regarding the CBI fleet, we have chartered in 48 period ships, with the majority of the fleet being on index-linked agreements. On our leasing platform, we have invested around $123 million. Neptune Maritime Leasing is financing 41 assets for a total amount of $513 million. Moving to slide eight, charters to the containership market remain at firm levels. Possible large-scale fleet redeployments due to the proposed USTR fees may create inefficiencies favorable to the current strong market dynamics.

The idle fleet remains at low levels at around 0.5%, indicating a fully employed market. Finally, on slide nine, you can see the recent dry bulk market trends in the spot and forward markets. Charter rates have recovered from their lows in February. The order book is at around 10% of the total fleet. With that, we conclude our presentation, and we can now take questions. Thank you. Operator, we can take questions now.

Operator (participant)

Thank you. As a reminder, if you would like to ask a question, please press star one on your telephone keypad and wait for your name to be announced. If you wish to cancel your request, please press star two. Again, that's star one to ask a question. At this time, we will pause momentarily to assemble our roster. Again, to ask a question, you may press star and then the number one on your telephone keypad. Seeing no questions at this time, I would like to pass the call back to Mr. Zikos for closing remarks.

Gregory Zikos (CFO)

Thank you for dialing in today and for your interest in Costamare. We are looking forward to speaking with you again in the next quarterly results call. Thank you. Operator, I think we have concluded. Thank you.

Operator (participant)

Thank you. That does conclude our conference for today. Thank you all for participating. You may now disconnect your lines.