Navios Maritime Acquisition Corporation Reports Financial Results for the Second Quarter and Six Months Ended June 30, 2018


  • Revenue: $41.5 million for Q2 2018; $87.6 million for the six months 2018
  • Unique bareboat structure on newbuild VLCCs
  • Navios Midstream acquisition proposal
  • Returning capital to stockholders:
    • Quarterly dividend: $0.02 per share
    • Stock repurchased YTD: 7,626,619 shares (5.0% of common shares)

MONACO, Aug. 22, 2018 (GLOBE NEWSWIRE) -- Navios Maritime Acquisition Corporation (“Navios Acquisition”) (NYSE: NNA), an owner and operator of tanker vessels, reported its financial results today for the second quarter and the six month period ended June 30, 2018.

Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition, stated, “I am pleased with the results of the second quarter, for which we reported revenue of $41.5 million and Adjusted EBITDA of $11.0 million.”

Angeliki Frangou continued, “The oil transportation market continues to be under pressure. We are maintaining cost control, as operating costs are about 17% lower than our listed peers, based on 2017 data. We are also taking advantage of this market by returning capital to stockholders through dividend and stock repurchase programs. We declared a dividend of $0.02 for the second quarter and have repurchased approximately 7.6 million shares (about 5.0% of the shares outstanding) YTD 2018."

HIGHLIGHTS — RECENT DEVELOPMENTS

Bareboat structure on newbuild VLCCs
In August 2018, Navios Acquisition agreed to the main terms of a 12-year bareboat charter-in agreement with de-escalating purchase options for two newbuild Japanese VLCCs delivering in the third and fourth quarter of 2020, respectively. The bareboat charter-in agreement reflects an implied price of approximately $84.5 million per vessel and an annual effective interest of approximately 6% fixed for the duration of the agreement. Concurrently, Navios Acquisition agreed to the main terms of bareboat charter-out agreements with a duration of 10 years for each vessel plus a five-year optional period granted to the charterer. The bareboat charter-out rate is $27,816 net per day, $29,751 net per day for the optional period, and the charterer is granted de-escalating purchase options. The above structure is expected to provide an annual free cash flow of approximately $5.0 million on average for the duration of the bareboat charter-in agreement. The above structure is subject to definitive documentation and there can be no assurances that it will be completed in full or that, if agreed upon, will be pursuant to the terms described in this press release.

Dividend of $0.02 per share of common stock
On July 31, 2018, the Board of Directors of Navios Acquisition declared a quarterly cash dividend for the second quarter of 2018 of $0.02 per share of common stock. The dividend is payable on September 27, 2018 to stockholders of record as of September 20, 2018. The declaration and payment of any further dividends remain subject to the discretion of the Board of Directors and will depend on, among other things, Navios Acquisition’s cash requirements as measured by market opportunities and restrictions under its credit agreements and other debt obligations and such other factors as the Board of Directors may deem advisable.

Navios Midstream acquisition proposal
On June 28, 2018, Navios Acquisition announced that it has submitted a proposal to the Board of Directors of Navios Maritime Midstream Partners L.P. (“Navios Midstream”) (NYSE:NAP) to acquire the publicly held units of Navios Midstream not already owned by Navios Acquisition in a stock for units exchange.

Subject to negotiation and execution of a definitive agreement, Navios Acquisition is proposing consideration of 6.292 Navios Acquisition shares for each outstanding publicly held common unit of Navios Midstream as part of a transaction that would be structured as a merger of Navios Midstream with and into Navios Acquisition.

The proposed transaction is subject to the negotiation and execution of a definitive agreement, approval of the Board of Directors of Navios Acquisition and the necessary approvals of the conflicts committee of Navios Midstream under Navios Midstream’s limited partnership agreement. The consummation of the proposed transaction would be subject to customary closing conditions. There can be no assurance that any such approvals will be forthcoming, that a definitive agreement will be executed, or that any transaction will be consummated.

Stock repurchase program
As of August 21, 2018, Navios Acquisition has repurchased 7,626,619 shares for approximately $6.0 million, under the $25.0 million stock repurchase program, providing an additional return of 5.0% to our stockholders.

Time charter coverage
Navios Acquisition currently owns 35 vessels, of which seven are VLCCs, 26 are product tankers and two are chemical tankers.

Currently, Navios Acquisition has contracted 93.8% of its available days on a charter-out basis for 2018, which is expected to generate revenues of approximately $148.3 million for 2018. The average contractual net daily charter-out rate for the 83.7% of the available days that are contracted on base rate and/or on base rate with profit sharing arrangements is expected to be $13,987 for 2018.

FINANCIAL HIGHLIGHTS

For the following results and the selected financial data presented herein, Navios Acquisition has compiled its consolidated statements of operations for the three and six months ended June 30, 2018 and 2017. The quarterly information for 2018 and 2017 was derived from the unaudited condensed consolidated financial statements for the respective periods.  

               
(Expressed in thousands of U.S. dollars)   

Three Month
Period ended
June 30, 
2018
(unaudited)
   

Three Month
Period ended
June 30, 
2017
(unaudited)
   Six Month
Period
ended
June 30, 
2018

(unaudited)
  Six Month
Period
ended
June 30,
2017

(unaudited)
 
Revenue  $41,479  $58,458   $87,629  $122,940 
Net loss  $(22,068) $(64,417  $(46,534) $(58,802
Adjusted net (loss)/ income   $(21,777)(1) $(4,617)(3)   $(39,697)(2) $998(3)
Net cash (used in)/provided by operating activities   

$
(19,578)  

$
5,470    

$
(30,994)  

$
33,106 
EBITDA  $10,727  $(32,024)  $19,487  $5,357 
Adjusted EBITDA  $10,999(1) $27,080(3 )  $26,008(2) $64,461(3 )
Loss per share (basic)  $(0.15) $(0.41)  $(0.30 $(0.37
Adjusted (loss)/earnings per share (basic)  $(0.14)(1) $(0.03)(3)   $(0.26)(2) $0.01(3)

  1. EBITDA, net loss and loss per share (basic) for the three month period ended June 30, 2018 have been adjusted to exclude $0.3 million of non-cash stock-based compensation. (Net loss and loss per share (basic) for the three month period ended June 30, 2018 were further adjusted to exclude $0.02 million write-off of deferred finance costs.)
     
  2. EBITDA, net loss and loss per share (basic) for the six month period ended June 30, 2018 have been adjusted to exclude: (i) $6.0 million of negative effect on equity/ (loss) in net earnings of affiliated companies, relating to the sale of the Shinyo Kannika by Navios Midstream; (ii) $0.5 million of non-cash stock-based compensation; and (iii) $0.03 million of gain from sale of the Nave Galactic. Net loss and loss per share (basic) for the six month period ended June 30, 2018 were further adjusted to exclude $0.3 million write-off of deferred finance costs.
     
  3. EBITDA, net loss and loss per share (basic) for the three and six month period ended June 30, 2017 have been adjusted to exclude $59.1 million of non-cash impairment loss on equity investment in Navios Midstream. Furthermore, net loss and net loss per share (basic) for the three and six month period ended June 30, 2017 were further adjusted to exclude $0.7 million write-off of deferred finance cost.  

EBITDA, Adjusted EBITDA, Adjusted net (loss)/ income and Adjusted (loss)/income per share (basic) are non-GAAP financial measures and should not be used in isolation or substitution for Navios Acquisition’s results (see Exhibit II for reconciliation of EBITDA and Adjusted EBITDA). 

Three month periods ended June 30, 2018 and 2017

Revenue for the three month period ended June 30, 2018 decreased by $17.0 million, or 29.0%, to $41.5 million, as compared to $58.5 million for the same period of 2017. The decrease was mainly attributable to a: (i) decrease in the market rates during the second quarter ended June 30, 2018, as compared to the same period in 2017; and (ii) decrease in revenue by $2.5 million due to the sale of the Nave Galactic to Navios Midstream in March 2018. Available days of the fleet decreased to 3,079 days for the three month period ended June 30, 2018, as compared to 3,256 days for the three month period ended June 30, 2017. The time charter equivalent rate, or TCE Rate, decreased to $13,260 for the three month period ended June 30, 2018, from $17,491 for the three month period ended June 30, 2017.

Net loss for the three month period ended June 30, 2018 amounted to $22.1 million as compared to $64.4 million for the same period of 2017. Net loss was affected by the items described in the table above. Adjusted net loss for the three month period ended June 30, 2018 increased by approximately $17.2 million to $21.8 million loss as compared to $4.6 million loss for the same period of 2017. The increase in adjusted net loss was due to a: (a) $16.1 million decrease in Adjusted EBITDA; (b) $0.8 million increase in direct vessel expenses; (c) $0.6 million decrease in interest income; and (d) $0.2 million increase in interest expense and finance cost, net of deferred finance cost; partially mitigated by $0.4 million decrease in depreciation and amortization.

Adjusted EBITDA, affected by the items described in the table above, for the three month period ended June 30, 2018 decreased by approximately $16.1 million to $11.0 million, as compared to $27.1 million for the same period of 2017. The decrease in Adjusted EBITDA was mainly due to a: (a) $17.0 million decrease in revenue, as described above; (b) $0.9 million increase in general and administrative expenses (excluding stock based compensation); (c) $0.8 million increase in time charter expenses mainly due to the accrued backstop commitment to Navios Midstream; and (d) $1.0 million increase in other (expense)/ income, net; partially mitigated by a: (i) $2.9 million increase in equity /(loss) in net earnings of affiliated companies; and (ii) $0.8 million decrease in management fees, due to the sale of the Nave Galactic to Navios Midstream in March 2018, which was partially offset by the amendment to the fees under the Management Agreement.

Six month periods ended June 30, 2018 and 2017

Revenue for the six month period ended June 30, 2018 decreased by $35.3 million, or 28.7%, to $87.6 million, as compared to $122.9 million for the same period of 2017. The decrease was mainly attributable to a: (i) decrease in the market rates during the six month period ended June 30, 2018, as compared to the same period in 2017; and (ii) decrease in revenue by $4.1 million mainly due to the sale of the Nave Galactic to Navios Midstream in March 2018. Available days of the fleet decreased from 6,463 days for the six month period ended June 30, 2017, as compared to 6,261 days for the six month period ended June 30, 2018. The TCE Rate decreased from $18,475 for the six month period ended June 30, 2017, to $13,740 for the six month period ended June 30, 2018.

Net loss for the six month period ended June 30, 2018 amounted to $46.5 million as compared to $58.8 million for the same period of 2017. Net loss was affected by the items described in the table above. Adjusted net loss for the six month period ended June 30, 2018 increased by $40.7 million to $39.7 million loss as compared to $1.0 million income for the same period of 2017. The increase was due to a: (a) $38.5 million decrease in Adjusted EBITDA; (b) $1.4 million increase in direct vessel expenses; (c) $0.9 million decrease in interest income; and (d) $0.4 million increase in interest expense and finance cost; partially mitigated a by $0.5 million decrease in depreciation and amortization.

Adjusted EBITDA, affected by the items described in the table above, for the six month period ended June 30, 2018 decreased by approximately $38.5 million to $26.0 million, as compared to $64.5 million for the same period of 2017. The decrease in Adjusted EBITDA was mainly due to a: (a) $35.3 million decrease in revenue, as described above; (b) $3.4 million increase in time charter expenses mainly due to the accrued backstop commitment to Navios Midstream; (c) $1.1 million increase in general and administrative expenses (excluding stock based compensation); (d) $1.2 million increase in other (expense)/ income, net; partially mitigated by a: (i) $1.8 million increase in equity /(loss) in net earnings of affiliated companies; and (ii) $0.8 million decrease in management fees, due to the sale of the Nave Galactic to Navios Midstream in March 2018, which was partially offset by the amendment to the fees under the Management Agreement.

Fleet Employment Profile   

The following table reflects certain key indicators of the performance of Navios Acquisition and its core fleet for the three and six month periods ended June 30, 2018 and 2017.

                 
  Three month period ended
June 30,
  Six month period ended
June 30,
 
  2018
(unaudited)
  2017
(unaudited)
  2018
(unaudited)
  2017
(unaudited)
 
FLEET DATA                
Available days(1)  3,079   3,256   6,261   6,463 
Operating days(2)  3,067   3,253   6,233   6,455 
Fleet utilization(3)  99.6  99.9  99.6  99.9
Vessels operating at period end  35   36   35   36 
AVERAGE DAILY RESULTS                
Time charter equivalent rate per day(4) $13,260  $17,491  $13,740  $18,475 

Navios Acquisition believes that the important measures for analyzing trends in its results of operations consist of the following:

(1)Available days: Available days for the fleet are total calendar days the vessels were in Navios Acquisition’s 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: 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: Fleet utilization is the percentage of time that Navios Acquisition’s 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 and minimizing the amount of days that its vessels are off hire for reasons other than scheduled repairs, dry dockings or special surveys.
(4)TCE Rate: Time charter equivalent rate per day is defined as voyage and time charter revenues less voyage expenses during a period divided by the number of available days during the period. The TCE Rate per day is a standard shipping industry performance measure used primarily to present the actual daily earnings generated by vessels of various types of charter contracts for the number of available days of the fleet.

Conference Call, Webcast and Presentation Details:

As previously announced, Navios Acquisition will host a conference call today, Wednesday, August 22, 2018 at 8:30 am ET, at which time Navios Acquisition's senior management will provide highlights and commentary on earnings results for the second quarter ended June 30, 2018.

Conference Call details:

US Dial In: +1.877.480.3873
International Dial In: +1.404.665.9927
Conference ID: 997 7697

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: +1.800.585.8367
International Replay Dial In: +1.404.537.3406
Conference ID: 997 7697

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

A supplemental slide presentation will be available by 8:00 am ET on the day of the call.

About Navios Acquisition

Navios Acquisition (NYSE: NNA) is an owner and operator of tanker vessels focusing on the transportation of petroleum products (clean and dirty) and bulk liquid chemicals. 

For more information about Navios Acquisition, please visit our website: www.navios-acquisition.com.

Forward Looking Statements 

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 expectations, including with respect to Navios Acquisition’s future dividends, 2018 cash flow generation and Navios Acquisition’s growth strategy and measures to implement such strategy; including expected vessel acquisitions and entering into further employment contracts and any potential merger with Navios Midstream. Words such as “may,” “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 revenue and employment contracts and any potential merger with Navios Midstream. These forward-looking statements are based on the information available to, and the expectations and assumptions deemed reasonable by, Navios Acquisition at the time this filing was made. Although Navios Acquisition 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 Acquisition. 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 the timing and the ability to consummate the potential merger with Navios Midstream, the creditworthiness of our charterers and the ability of our contract counterparties to fulfill their obligations to us, tanker industry trends, including charter rates and vessel values and factors affecting vessel supply and demand, the aging of our vessels and resultant increases in operation and dry docking costs, the loss of any customer or charter or vessel, our ability to repay outstanding indebtedness, to obtain additional financing and to obtain replacement charters for our vessels, in each case, at commercially acceptable rates or at all, increases in costs and expenses, including but not limited to: crew wages, insurance, provisions, port expenses, lube oil, bunkers, repairs, maintenance and general and administrative expenses, the expected cost of, and our ability to comply with, governmental regulations and maritime self-regulatory organization standards, as well as standard regulations imposed by our charterers applicable to our business, potential liability from litigation and our vessel operations, including discharge of pollutants, general domestic and international political conditions, competitive factors in the market in which Navios Acquisition operates; risks associated with operations outside the United States; and other factors listed from time to time in the Navios Acquisition’s filings with the SEC, including its annual and interim reports filed on Form 20-F and Form 6-K. Navios Acquisition 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 Acquisition’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. Navios Acquisition makes no prediction or statement about the performance of its common stock.

Public & Investor Relations Contact:
Navios Maritime Acquisition Corporation
+1.212.906.8644
info@navios-acquisition.com


EXHIBIT I


  
NAVIOS MARITIME ACQUISITION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of U.S. dollars- except share data)
 
    June 30,
2018
(unaudited)
  December 31,
2017
(unaudited)
 
ASSETS          
Current assets          
Cash and cash equivalents   $49,466  $81,151 
Restricted cash    2,598   5,307 
Accounts receivable, net    12,853   12,810 
Due from related parties, short term    14,714   13,931 
Prepaid expenses and other current assets    6,972   6,534 
Total current assets    86,603   119,733 
Vessels, net    1,177,671   1,250,043 
Goodwill    1,579   1,579 
Other long-term assets    3,450   900 
Deferred dry dock and special survey costs, net    28,577   20,871 
Investment in affiliates    116,136   125,062 
Due from related parties, long-term    54,218   54,593 
Total non-current assets    1,381,631   1,453,048 
Total assets   $1,468,234  $1,572,781 
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities          
Accounts payable   $4,456  $3,862 
Accrued expenses    13,375   12,211 
Due to related parties, short-term    10,064   17,107 
Deferred revenue    5,833   5,028 
Current portion of long-term debt, net of deferred finance costs    48,803   36,410 
Total current liabilities    82,531   74,618 
Long-term debt, net of current portion, premium and net of deferred finance costs    974,588   1,028,959 
Deferred gain on sale of assets    6,356   6,729 
Total non-current liabilities    980,944   1,035,688 
Total liabilities   $1,063,475  $1,110,306 
Commitments and contingencies    —    —  
Stockholders’ equity          
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; 1,000 series C shares issued
and outstanding as of June 30, 2018 and December 31, 2017
    —    —  
Common stock, $0.0001 par value; 250,000,000 shares authorized; 145,244,205 and 152,107,905
issued and outstanding as of June 30, 2018 and December 31, 2017, respectively
      14   15 
Additional paid-in capital    506,890   518,071 
Accumulated deficit    (102,145)  (55,611
Total stockholders’ equity     404,759   462,475 
Total liabilities and stockholders’ equity   $1,468,234  $1,572,781 
           


 
NAVIOS MARITIME ACQUISITION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of U.S. dollars- except share and per share data)
 
    For the Three  For the Three  For the Six  For the Six 
    Months  Months  Months  Months 
    Ended  Ended  Ended  Ended 
    June 30, 2018  June 30, 2017  June 30, 2018  June 30, 2017 
    (unaudited)  (unaudited)  (unaudited)  (unaudited) 
Revenue   $41,479  $58,458  $87,629  $122,940 
Time charter and voyage expenses     (6,363)  (5,585  (12,189)  (8,763
Direct vessel expenses    (1,692)  (934  (3,240)  (1,827
Management fees (entirely through related party transactions)    (22,913)  (23,678  (46,312)  (47,096
General and administrative expenses    (4,892)  (3,693  (8,055)  (6,456
Depreciation and amortization    (13,776)  (14,220  (27,986)  (28,440
Gain on sale of vessel    —    —    25   —  
Interest income    1,978   2,546   3,814   4,740 
Interest expense and finance cost    (19,305)  (19,785  (38,609)  (38,632
Equity/ (loss) in net earnings of affiliated companies    4,229   (57,728  (59)  (54,960
Other (expense)/ income, net    (813)  202   (1,552)  (308
                   
Net loss   $(22,068) $  (64,417 $(46,534) $(58,802
                   
Net loss per share, basic and diluted   $(0.15) $(0.41 $(0.30) $(0.37
Weighted average number of shares, basic    144,228,909   150,436,836   146,378,370   150,468,625 
Weighted average number of shares, diluted    144,228,909   150,436,836   146,378,370   150,468,625 
                   


  
NAVIOS MARITIME ACQUISITION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in thousands of U.S. dollars)
 
  
    For the Six Months
Ended June 30, 2018
(unaudited)
  For the Six Months
Ended June 30, 2017
(unaudited)
 
Operating Activities          
Net loss   $(46,534) $(58,802
Adjustments to reconcile net loss to net cash provided by operating activities:          
Depreciation and amortization    27,986   28,440 
Amortization and write-off of deferred finance fees and bond premium    1,981   2,579 
Amortization of dry dock and special survey costs    3,240   1,827 
Stock based compensation    541   —  
Gain on sale of vessel    (25)  —  
Equity/ (loss) in net earnings of affiliates, net of dividends received    59   58,413 
Changes in operating assets and liabilities:          
(Increase)/ decrease in prepaid expenses and other current assets    (438)  20 
Decrease in accounts receivable    41   9,484 
(Increase)/ decrease in due from related parties, short-term    (783)  6,047 
Increase in other long term assets    (2,550)  —  
Decrease/ (increase) in due from related parties, long-term    1,851   (15,979
Increase/ (decrease) in accounts payable    426   (433
Increase in accrued expenses    588   554 
Payments for dry dock and special survey costs    (11,411)  (4,928
(Decrease)/ increase in due to related parties, short-term    (6,887)  5,937 
Increase/ (decrease) in deferred revenue    921   (53
           
Net cash (used in)/ provided by operating activities   $(30,994) $33,106 
           
Investing Activities          
Loans receivable from affiliates    —    (9,061
Dividends received from affiliates    6,902   7,197 
Investment in affiliates    —    (84
Net cash proceeds from sale of vessel    44,500   —  
           
Net cash provided by/ (used in) investing activities   $51,402  $(1,948
           
Financing Activities          
Loan proceeds, net of deferred finance costs    70,392   49,764 
Loan repayments    (113,471)  (63,226
Dividend paid    (6,167)  (15,812
Redemption of convertible shares and puttable common stock    —    (1,750
Acquisition of treasury stock    (5,556)  —  
           
Net cash used in financing activities   $(54,802) $(31,024
           
Net (decrease)/ increase in cash, cash equivalents and restricted cash    (34,394)  134 
Cash, cash equivalents and restricted cash, beginning of period    86,458   56,658 
           
Cash, cash equivalents and restricted cash, end of period   $52,064  $56,792 
           

EXHIBIT II

Reconciliation of EBITDA and Adjusted EBITDA to Net Cash from Operating Activities

                 
  Three Month
Period
Ended
June 30,
2018
(unaudited)
  Three Month
Period
Ended
June 30,
2017
(unaudited)
  Six Month
Period
Ended
June 30,
2018
(unaudited)
  Six Month
Period
Ended
June 30,
2017
(unaudited)
 
Expressed in thousands of U.S. dollars                
Net cash (used in)/ provided by operating activities $(19,578) $5,470  $(30,994) $33,106 
Net (decrease)/ increase in operating assets  (45)  (4,506  1,879   428 
Net decrease/ (increase) in operating liabilities  2,410   8,136   4,952   (6,005
Net interest cost  17,327   17,239   34,795   33,892 
Amortization and write-off of deferred finance costs and bond premium  (885)  (1,663  (1,981)  (2,579
Equity/ (loss) in net earnings of affiliates (including OTTI loss), net of dividends received  4,229   (58,721  (59)  (58,413
Payments for dry dock and special survey costs  7,541   2,021   11,411   4,928 
Gain on sale of vessel  —    —    25   —  
Stock-based compensation  (272)  —    (541)  —  
                 
EBITDA  10,727   (32,024)  19,487   5,357 
Net negative effect on equity/ (loss) in net earnings of affiliated companies due to sale of the Shinyo 
Kannika by Navios Midstream to an unaffiliated third party
  —    —    6,005   —  
Gain on sale of vessel  —    —    (25)  —  
Stock-based compensation  272   —    541   —  
Other-than-temporary-impairment loss on equity investment  —    59,104   —    59,104 
Adjusted EBITDA $10,999  $27,080  $26,008  $64,461 
                 
     
  Three Month
Period
Ended
June 30,
2018
(unaudited)
  Three Month
Period
Ended
June 30,
2017
(unaudited)
  Six Month
Period
Ended
June 30,
2018
(unaudited)
  Six Month
Period
Ended
June 30,
2017
(unaudited)
 
Net cash (used in)/ provided by operating activities $(19,578) $5,470  $(30,994) $33,106 
Net cash provided by/ (used in) investing activities $1,576  $526  $51,402  $(1,948
Net cash used in financing activities $(11,069) $(21,336 $(54,802) $(31,024
                 

Disclosure of Non-GAAP Financial Measures

EBITDA, Adjusted EBITDA, Adjusted net (loss)/ income and Adjusted (loss)/ income per share (basic) are non-U.S. GAAP financial measures and should not be used in isolation or as substitution for Navios Acquisition’s results calculated in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”).

EBITDA represents net (loss)/income before interest and finance costs, before depreciation and amortization and before income taxes. Adjusted EBITDA in this document represents EBITDA excluding certain items as described under “Financial Highlights”. Adjusted net (loss)/ income and Adjusted (loss)/ income per share (basic) represent Net (loss)/ income and (loss)/ income per share (basic), excluding certain items as described under “Financial Highlights”. We use Adjusted EBITDA as liquidity measure and reconcile EBITDA and Adjusted EBITDA to net cash provided by/ (used in) operating activities, the most comparable U.S. GAAP liquidity measure. EBITDA is calculated as follows: net cash provided by/(used in) operating activities adding back, when applicable and as the case may be, the effect of: (i) net increase/(decrease) in operating assets; (ii) net (increase)/decrease in operating liabilities; (iii) net interest cost; (iv) amortization of deferred finance costs and other related expenses; (v) equity/ (loss) in net earnings of affiliates, net of dividends received; (vi) payments for dry dock and special survey costs; (vii) impairment charges; (viii) gain on sale of assets; (ix) gain/ (loss) on debt repayment; and (x) stock- based compensation. Navios Acquisition believes that EBITDA and Adjusted EBITDA are each the basis upon which liquidity can be assessed and present useful information to investors regarding Navios Acquisition’s ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. Navios Acquisition also believes that EBITDA and Adjusted EBITDA are used: (i) by potential lenders to evaluate potential transactions; (ii) to evaluate and price potential acquisition candidates; and (iii) by securities analysts, investors and other interested parties in the evaluation of companies in our industry. EBITDA and Adjusted EBITDA have limitations as an analytical tool, and should not be considered in isolation or as a substitute for the analysis of Navios Acquisition’s results as reported under U.S. GAAP. Some of these limitations are: (i) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, working capital needs; and (ii) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future. EBITDA and Adjusted EBITDA do not reflect any cash requirements for such capital expenditures. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as a principal indicator of Navios Acquisition’s performance. Furthermore, our calculation of EBITDA and Adjusted EBITDA may not be comparable to that reported by other companies due to differences in methods of calculation.

EXHIBIT III

VesselsTypeYear Built/DeliveryDWT
Date
Owned Vessels    
Nave PolarisChemical Tanker2011 25,145
Nave CosmosChemical Tanker2010 25,130
Nave VelocityMR2 Product Tanker2015 49,999
Nave SextansMR2 Product Tanker2015 49,999
Nave PyxisMR2 Product Tanker2014 49,998
Nave LuminosityMR2 Product Tanker2014 49,999
Nave JupiterMR2 Product Tanker2014   49,999
BougainvilleMR2 Product Tanker2013 50,626
Nave AlderaminMR2 Product Tanker2013 49,998
Nave BellatrixMR2 Product Tanker2013 49,999
Nave CapellaMR2 Product Tanker2013 49,995
Nave OrionMR2 Product Tanker2013 49,999
Nave TitanMR2 Product Tanker2013 49,999
Nave AquilaMR2 Product Tanker2012 49,991
Nave AtriaMR2 Product Tanker2012 49,992
Nave OrbitMR2 Product Tanker2009 50,470
Nave EquatorMR2 Product Tanker2009 50,542
Nave EquinoxMR2 Product Tanker2007 50,922
Nave PulsarMR2 Product Tanker2007 50,922
Nave DoradoMR2 Product Tanker2005 47,999
Nave AtroposLR1 Product Tanker2013 74,695
Nave RigelLR1 Product Tanker2013 74,673
Nave CassiopeiaLR1 Product Tanker2012 74,711
Nave CetusLR1 Product Tanker2012 74,581
Nave EstellaLR1 Product Tanker2012 75,000
Nave AndromedaLR1 Product Tanker2011 75,000
Nave AriadneLR1 Product Tanker2007 74,671
Nave CieloLR1 Product Tanker2007 74,671
Nave Buena SuerteVLCC2011   297,491
Nave QuasarVLCC2010  297,376
Nave SynergyVLCC2010 299,973
Nave SphericalVLCC2009 297,188
Nave PhotonVLCC2008 297,395
Nave NeutrinoVLCC2003 298,287
Nave ElectronVLCC2002 305,178