CMRE - Earnings call 3 2023

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Operator

Thank you for standing by, ladies and gentlemen, and welcome to the Costamare Inc. Conference Call on the Third Quarter 2023 Financial Results.

We have with us, Mr. Gregory Zikos, Chief Financial Officer of the company. [Operator Instructions] I must advise you that this conference is being recorded today, Wednesday, November 1, 2023.

remind this to forward-looking call like statements. would you conference that contains We moment #X read which take to Please a Slide forward-looking contains statements. of the presentation, the

Mr. floor And your pass will go the I speaker sir. now today, Zikos. Please ahead, to

Gregory Zikos

ladies good gentlemen. Thank morning, you, and and

quarter market, year, sector, $X to tight the order enjoy smaller about the generated emulation. containership of insufficient ships deteriorating the the billion. net continue conditions. a close third and book uncertain market During million liquidity as was company vessels experienced outlook income larger the to large $XX due while of of the quarter end, Overall, the to In looks

acquired at older Supramax of we the strategy increases the X to X bulk the disposed our of renew we and Capesize vessel. Ultramax same as On into dry time, And part our fleet ships. size, side, our

own Our trading the trade sector, a operating dry to bulk vessels. the spot are we vessels long-term while XX in of the Having basis, grown fleet committed to dry platform, positively. whose bulk we a million view $XXX invested has on platform continue fundamentals to

Regarding Neptune growing concluded a in quarters. steadily transaction has Maritime platform having healthy ships complemented basis, total, over the for XX are by the coming been leasing which prudent a on extending Leasing, pipeline

heavily worth is the quarter, price shares, common of highlighting and million considering and program, the prospects. our company's $XX share performance during Finally, belief bought we continued repurchase both our we strong that the share undervalued

million Adjusted per million was the quarter $X.XX third share. $XX On or Moving $XX now for results. you quarter or the Net Slide can X, roughly share. around income net per $X.XX our presentation. slide income to was see

at stands Our roughly billion. liquidity $X

purchased our XXX,XXX can you update worth. an we shares our Since X, Slide QX common for earnings release, million share repurchase $XX approximately on program. see

have uninterrupted record a we dividend boosted In sponsor strong long support. to track addition, continue by

X. Slide

in inception, has fleet lease and vessels On very leasing with index-linked through invested Since and in vessels platform, lease-back our the XX the already Regarding we majority and NML of have XX-period financed chartered pipeline. sale transactions healthy million. have a has charter-in CBI, -- we sale agreement. $XX around

Slide to X. Turning

Ultramax to We X while have vessel, Supramax one dry into sell X have agreed bulk bulk we dry Capesize ships. acquired

In we the XXXX-built have containership XXXX-built containership with interest a another our concluded sale along XX% addition, of of sale on vessel. the equity

Slide X.

acquisitions. we $XXX roughly license During financed hunting have the dry of vessels we the facility, the have acquisition million X available bulk to an while of vessel for quarter, financing existing

more vessels having charter the our bulk We agreements release. market, continue to entered spot chartering in since dry last all into than our XX earnings

time containership years. remaining days XXX% the side, of our TEU-weighted year, and $X.X fixed XX% for billion 'XX, are for with for essentially a while are our On 'XX revenues contracted revenue this X.X XX% duration

Slide X.

roughly at liquidity the stands prudent the opportunities This a for liquidity $X billion. basis. to grow gives company Our us look ability to on

since you bulk of Slide pre-COVID have XX, fleet. total rates, X remaining remains remaining dry spotted levels the mainly the at book the about market recent trends sizes containership added though the the markets. Charter X.X% rates see at at for of X.X%. On low capacity have softened levels. market smaller The charter Slide is QX, can strengthened in forward order The volatile. although

we you. Thank and that, take presentation, With conclude questions. can now can we our

we Operator, now. take questions can

Operator

the from [Operator Instructions] from Chris And your line first Citigroup. of Wetherbee question comes

Christian Wetherbee

any market side to sense the start wanted just container demand in general term. of, and maybe the on I for maybe a your I guess, guess view I of get

market through as about entering can what capacity side? market. for of I'm talk just the So and the you your I rechartering the a and get just thoughts the But in there think you sort to employment, are in on guess that's the what activity that sense of we understand us trying out weakness the is you're obviously seeing opportunities

Gregory Zikos

general, Yes. going have seen year a ago charter ships. extent, argue to for fixtures of the container shorter-term XX a which is you because the it on fixtures some rates down, compare after And have and a we something that, now, and can COVID. previous year in if cannot numbers, every been you up that I can that expected you have going market shares mean, you say single We've I think

the year, for also example, now so Prior at to for So day. at $XX,XXX $XX,XXX past, vessel at the we seen for between around longer we've there $XX,XXX was And higher now a levels the periods. see traditional Panamax is a now -- fixtures between $XX,XXX. Panamax per to the or in is fixtures for to it could that, year

although smaller see and the ago, you the months shorter that still can said of a well they charter think people tenor trend, to market party can that, the levels, the very at the relatively rate much levels. they for thought that the healthy Especially than downward agreement, and holding Having is know however, we better need we vessels, trend charter still are to see become shorter. tend I up X

are we healthy, market and the very ships, can they rates are quite see for still So profitable. especially that, larger

It's order quite order all time, demand the same And large order in the to So whether levels going we group. needs do low. be questionable the at that is absorbed. have highly book to demolition digest to a be are

during supply heading, going So demand will think be we I to the don't market experienced think be and dynamics there. that are forward, going I the COVID where

with At building prices more logical when time, which of is and market Quite the again. enter ready expected. asset more sort the say, prices, is We new we, as This time we also do charter would to would at, come a opposite, say. opportunities downward together levels I same let's this means Costamare, be levels. when a see the trend, something

we peak any over put years. know, market didn't you at last bidding the new the As orders of the

interesting. the for find then may to its market average become And expect levels. do we rate So more this

Christian Wetherbee

Okay.

difficult you're color. quarter one first you early how in maybe if on beyond bulk profitability of That's a and model, look then half but dry the thinking platform, is of plan I about sense sense to bit looks to in that either the to I in could can maybe And bit little you Okay. least you obviously, of of charter-in, revenue us of next want us further terms vessels so or get give that? the a capacity appreciate a sense how little think we this a that a for a quarter, get better how maybe could very helpful. fourth

Gregory Zikos

FFA model, it's volatile chartering-in relets, and charters say, very because you're vessel in exposure. to because also Yes, cargo have vessels our relets, I would entering into This right it's a we complement about order business [indiscernible] it. is into book an and difficult entering

how First be of how and on more discuss streamlined can each this the can all, other. side, then discussion, we modeling can we assist have can enough we light

year. Now to ships depending the We're grown quite conditions. grow on company going of substantially market has It's since XX beginning started charter-in. the it

we that need debt. the the runs because in accelerator. the push by We levered put if further, we the justify have view XXX% we X whole take And But company itself. it's infrastructure grow will market conditions It's this. growing to don't place. with funded equity This a

I have desired will the yet that size by reached a this general, don't conditions. it we think operator, also timing, the also size, dictated operator In to But levels. and healthy have have market is be to

are overall, we business. committed So long-term that to

to we're goal we of going is a have and grow a market, basis. we view and to I'm Our further, afraid the timing, this quarter-by-quarter on be better but will, to need evaluating

Operator

with The next question comes Omar from Jefferies. Nokta

Omar Nokta

of on follow maybe -- your the talking the wanted like just nearly I just just Yes, CBI to wanted liquidity. I $X platform. And here was kind now obviously, Chris' about it portion in of about dry the have ask, to bulk just up you you question, sounds of maybe it. response billion

have the backlog. $X.X You billion

build and you you actual the it you I or did continue the that how forward? the latest going out see do bigger ones. to we fleet some ownership of of about a fleet, Kind from asset and expansion You smaller owned -- with be the Ultramax. building cases think out the looking here, here? to is ask, on to side that simply in to fleet you're Are Or focused wanted looking you is ships do case continue just the renew older, the selling from some it in how it would further? bringing

Gregory Zikos

average, Sure. older one Ultramax, we been What ships. platform XXXX-built, been now on say, our one last owned dry selling and is and Capes strategy like principle grow have bulk to The have and there XXXX-build. younger we larger and we let's buying smaller vessels, at been was vessels, sold we have the what doing,

the that this assuming So work going forward, makes of out numbers well. that sense course,

X. down average the size and increase strategy bulk be fleet break the Our average first also owned to would of dry the

those those things. started vessels. with Capes selling we smaller And X It's have buying the and

find we sense, that be make assuming forward, to transactions we're what doing. Going going this that is

So of would to replace Capes. Handys and with them younger -- as of in to mostly a the larger amount goal and and time reasonable Ultramax be ideally the smaller dispose ships

caveat Of again, put conditions a prices. course, to and I depending have here, on asset depending on market

Omar Nokta

moment? in I you complementing do the have How business this thinking working they but of in see Or and they think that kind build you the may are trading look about out just other I how are sort businesses? of the completely at platform? fleet? Got the with it. own And each that asked to still separate past,

Gregory Zikos

something are management First, by different being with the sense. that I teams mean, run they makes

who can they complement being argue X stand-alone a lot. time, So under same other people, both shareholder. different that Costamare a by -- teams. all are businesses, they But the Inc. At umbrella they management different run you the each are is

CBI we in owners. platform, are first are XXX% the In charterers. The we business, the

relet. We do also

relet. We cargo will do

We complement an but FFA It's they book. business, definitely different its a have other.

being, I think, it going Again, be future, out works well. for cannot the in on the Now predict. what's But time to continues. I it relatively market happening depends

it as of it leave and are synergies there is, correct? we So a complements, and lot

Omar Nokta

Got it.

And to first one it. the business the half was just you've committed the I of release, just side maybe the trading CBI. I million If that mentioned in one. then And Okay. recall, you in the know loss-making final $XXX

on the how rates quarter-to-date year. But what mentioned fourth? just the general, in this color looking give third here the quarter to we've can of you platform order, And of seen performed that You it's seen the we've relative average in maybe fourth quarter? sort obviously any how in in

Gregory Zikos

course. in fixed the the X place, core of have to there time reaching hire infrastructure all Look, put of XX months, within certain operating a initial asset, lot X vessels been company a the order supporting Yes. a have we in systems the platform and from first And started it is the people amount of that business.

to expect within So it's be like into losing money month to of this be first sort first didn't business X normal year or months, a highly we enter the profitable. something and the

I So case less think this similar more in all or the is platforms.

the forward, going going soon. to XK Now we're QX, pretty releasing numbers filing our with be regarding

I here. owned a medium-term the can fleet. don't talk the how year-end, is going platform For tell long-term as or not is be term a even commitment sector, know I we performing. short this you that But the mentioned, complementing to the to bulk is about which deal We dry

we're trading. viewed is was or has this on So We because terms taking long-term that, the well. the first And minimum been set that that. a based short-sighted is of think months, have X year take size the as company I to first record book how we we're a highly it not going not a of profitable. be the minimum the in need the year to a going it We size. doing it view be of to in or half first book and up well cargo need should like that be have to After view,

seen. has is of company remains long-term very capitalized. been be the this So well view, -- sort to this the But

it, it are supporting it. supporting and mentioned debt. will We has And earlier, no we continue as

freely equity any all order it's make to restrictions. debt operating be to So of it's going in sure that

Operator

Ben with from Nolan Next comes Stifel. question

Benjamin Nolan

causes get a part my just stuff. just to could, around and just come subsequently that have maybe rates Or to profitability, I'm what of -- CBI sharp the the if in things if to in respect follow-up Maybe trying frame head you to on as move, does of the saw a and anything? sensitivities move Greg. a So in profitability. October, the what I'm we just to September trying real Capesize the rate and you see where up movements with Can down. are kind first turn

Gregory Zikos

it's Look, there's -- to mean, restrictions -- difficult commercial also I here. it's some

as Capes voyages We also on have and an FFA on book we well. have Capes, fronthaul

charters. [indiscernible] we So since and enter we then charter-in into

run the with regarding vessels take I'm those. positioning into Capes, of both telling advantage of do business with during cannot in explain it's Capes detail to for core. I it's more and on afraid in volatility how FFA the So and because of open we now XX the like it it's we the get you which our like me try that difficult QX, book an to

I Capes the the rates take Panamax X very advantage volatile for this same much priority and been Capes we time, and try the But the monitor first to applies market market tell can X in capitalize the you downside the weeks, in same at then on opportunistically, more and to The it's of stable. last has to it. FAAs, is that charter volatility, especially our

into get we which into. console and that. offer it more position on I'm me for volatility-driven difficult a it's and It's loan to our But on Panamax what revealing is Capes enter detail cannot I doesn't what lot now, to of do So like opportunities. afraid

Benjamin Nolan

with Okay. from Is long as thinking any upside? like? commercial Is where Maybe broader of look small -- Well, fair major that how about there'll to we profitability I format profitability the we're profitability would that it time aren't there think sensitivities for and around assume appreciate the a of in that. then drivers are. the periods again, just should and be substantial what revenue shifts episodes perspective, about how,

Gregory Zikos

very our at are we in I good terms level breakeven revenues, the we bought is whole healthy like and very wouldn't of very on which predictability what profitability, based business, Otherwise, container of levels sort rates. at referring did time you because you can be sort of Based $X.X and mostly although of revenues the leasing, very based have doing in any if maritime tell contracted they a a CBI very bulk of CBI the easily low Look, I low Yes. next billion at on which at to profitability a of the this volatility be business dry on think backlog that stable contracted lower the by leverage. the this. sort portfolios. the of And can absorbed is short-term I owned vessels, company. cost the

mean, is of you nutshell, I something So part of in downturn we the business, market, think can digest avoid any is cannot a that the I it. short-term which

upside, the However, substantial. it's very

business something on we it's manageable. based the downside the So rest of the hold,

of that business if otherwise, didn't backlog, we So And enter the there we containership into cetera. have would et upside. is a lot

same business is this it. our how time, At owned is it for So the this bulk sense is which makes a us. that we vessels, look complementing at dry

on attractive the levels a low sector, So at level, calculated backlog Costamare say that the the of the in I charters it if business. liquidity, based high can contracted revenues, long-term risk, business, stable Inc. is very containership leasing

it. view how So this is I we mean,

Benjamin Nolan

through stable-ish to you then a what profitability modest looks of see That's moves. frame to basis, Yes. Understood. just was of on And CBI on at normal I and you the levels sort kind stand-alone in think like, speaking every trying big once a level just it? just while, a how path

Gregory Zikos

operation can translate and leaving pure There but charter-in have like the moves, cash not it do the does impact, You settlement of EPS. et however, from mark-to-market there gains aside may cash into is the unrealized a moved bigger in which, or FFAs, profitability affecting charter-out not which be like a brackets into exposure. have unrealized of losses [indiscernible], cetera, FFAs business in the of

would is profitability. this fundamentals Costamare, our of the something size whole that change not the of For

Benjamin Nolan

The buybacks. not curious for And it's mean, all, the me I obviously, buybacks, of Sure. I see on that. and to first and common common just question is been -- the the the yes. last exclusive No, appreciate preferred. to

terms it per think curious good is buybacks, this I how in the you million, the is I be thinking quarter? can a So either what rate this you're know And sort is common -- of that. run of mean, $XX is

Gregory Zikos

cannot be to like to you undervalued. the But of that we're going be any preferred we common because cannot I we QX and It tell I said, not common, future. size if more what's the you we or is the Look, et think like cetera. back buybacks bought Yes. it, whether going depends. do, as predict in doing rightly definitely

[indiscernible], it. at in preferred at look when look you at However, We it it terms some you however, $XX. buybacks was of of the trading past did in $XX,

par. it's Now at trading above slightly or par likely out

on we been million common $XXX But back. there focusing up have now, We to have to which buy make does the sense.

cannot what common to quarters. back we're of next We million predict going $XX total the I shares. worth in However, be doing put like

We but see. easily by can extended, have quarter. a quarter take be program we'll it XX We more, program for this

Operator

Next Value Edge. Investor's question comes from Climent Molins with

Climent Molins

by to the I would reporting. in like asking start on change

was this a aforementioned expect basis, helpful. be this which previously But on breakdown quarter. You permanent? not segment-by-segment we was breakdown a the provided for really created change to Should

Gregory Zikos

The the had because breakdown in filing. use of the numbers case, no in was you previous we find in any all can at quarter the X-K

is afraid, have release So going the made like I able see will to I'm It X-K press it the took you're just be refer didn't any with value. filing, reason you This provide out. to the where we longer. the breakdown. to to It

Climent Molins

how fleet? TCE quarter? For but Omar Right. your the dry asked and CBI, side vessels about Chris, own that additional provide sense. already on realized during some could example, performed Ben insight you bulk Makes you the on the of

Gregory Zikos

to again profitability X-K dry of of be part our bulk the is the vessel going Look, filing.

We we have a -- funds, have have Panamaxes. a now couple have we Capes, of we of number since mixed

like performed to more the has vessel, rating the them or exceptions. few TCE into very the don't actually It of based of the of overall, are XYZ it performed market. but want et fleet detail They Most have, that what think with then on go was all of and on Handys well, the fine. has with every I spot some we cetera. vessels what -- was I trading

we So index. follow the do

Operator

question-and-answer to This closing I Zikos would session. his the floor now remarks. concludes like Mr. for our pass to

Gregory Zikos

very call. much in Thank you dialing for today's in,

forward to speaking with you. in looking are next call. again We Thank the you results quarterly

Operator

does our all That for you. participating. for Thank conference today. Thank conclude you

disconnect now lines. your may You

Costamare (CMRE) 1 Nov 232023 Q3 Earnings call transcript