Costamare Inc. (NYSE:CMRE) Q4 2019 Earnings Conference Call - Final Transcript

Jan 29, 2020 • 08:30 am ET

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Costamare Inc. (NYSE:CMRE) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Thank you for standing by, ladies and gentlemen, and welcome to the Costamare Inc., Conference Call on the Fourth Quarter 2019 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. [Operator Instructions]. I must advise you that this conference call is being recorded today, Wednesday, January 29, 2020.

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.

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

Executive
Gregory G. Zikos

Thank you and good morning ladies and gentlemen. During the fourth quarter and the year, net income and earnings per share increased substantially, boosted by higher charter rates and the addition of new ships. As part of our Fleet Renewal program, we acquired during the quarter four Panamax vessels with an average age of about 11 years and disposal of equal number of ships with an average age of 27 years.

During the year, larger vessels enjoyed the rising charter market and today there is limited supply available in the Post-Panamax sizes. We have 18 Post-Panamax ships coming off charter over the next 12 months which positions us favorably should market momentum continue.

Moving to the slides presentation. On Slide three, you can see the highlights. Net income rose by approximately 80% in Q4'19 compared to last year. The adjusted EPS is $0.32 over the past year, net income was close to $100 million, posting a 47% increase compared to 2018. The adjusted EPS for 2019 is $0.91.

Moving to the next Slide, over the past quarter, we sold four small size containerships with an average age of 27 years and replaced them with four large size Panamax vessels with an average age of 11 years. The four Panamaxes has been acquired with equity and we are currently in advanced discussion with a leading European bank for their financing.

Slide five, we do maintain a strong balance sheet with approximately 41% leverage and no balance sheet financing. We also concluded four separate refinancings with leading European and U.S. financial institutions for four 11,000 TEU containerships co-owned with York Capital. We raised about $265 million in total from this new financing. Regarding operational performance, during the previous quarter, we achieved utilization rate of close to 100% and very competitive operating expenses.

Moving to Slide six, large containerships continue to benefit from a tight supply market over the next year, 18 of our vessels larger than 5,000 TEUs are coming off charter, which positions us favorably should market momentum continue. The idle fleet adjusted for vessels undergoing scrubber retrofits stands at a low 1.5% while the order book has remained at levels close to 10%. We would be paying our 37th consecutive quarterly dividends in February. Insiders have been participating in the