Costamare Inc. (NYSE:CMRE) Q2 2020 Earnings Conference Call - Final Transcript

Jul 28, 2020 • 08:30 am ET

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Costamare Inc. (NYSE:CMRE) Q2 2020 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 Incorporated Conference Call on the Second Quarter 2020 Financial Results. With us, we have Mr. Gregory Zikos, Chief Financial Officer of the Company. [Operator Instructions].

We'd 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'll now pass the floor to your speaker today, Mr. Zikos. Please go ahead, sir.

Executive
Gregory Zikos

Thank you, and good morning, ladies and gentlemen. During the second quarter, the company delivered strong results. Liquidity stood at around EUR220 million, and as already announced, during the second quarter of the year, we concluded our refinancing program, resulting in a smooth repayment profile with no meaningful debt maturities until 2024.

On the market side, data capacity has started decreasing, indicating improving market conditions. Demand continues to favor the larger and medium sizes and especially ships above 8,000 TEUs. Market activity has picked up, and we have chartered in total 24 ships during the quarter. After months of inactivity, the demolition market has reopened, and as part of our fleet renewal program, we have sold for demolition two 7,000 TEU ships which we plan to replace with younger tonnage.

Moving now to the slides presentation. On Slide Three, you can see the highlights. We do maintain a strong balance sheet with liquidity of about EUR220 million; leverage of approximately 40%; and no meaningful debt maturities until 2024. Adjusted net income for the quarter rose by approximately $5 million to $32 million. The adjusted EPS is $0.26, a 13% increase compared to Q2 2019. The net loss of $84 million is due to one-off non-cash losses of close to $110 million relating to asset disposals.

Moving to Slide four, our adjusted net income for the first half of the year rose by approximately $25 million to $64 million. The adjusted EPS is $0.54, a 54% increase compared to the first half of 2019. Net losses for the first half of the year amounted to $58 million due to one-off non-cash losses of about $110 million relating again to asset disposals. Since the beginning of the year, we have raised more than $435 million in debt financing.

Slide Five, we have continued our efficient fleet operation with competitive operating expenses of just over $4,900 per day per vessel. We have recently taken delivery of our first 13,000 TEU containership out of a series of five sister vessels. The ship has commenced this 10-year charter with Yang Ming. The remaining four newbuildings will also commence their respective 10-year charters upon their deliveries. Finally, as part of our fleet renewal program, we sold two 23-year old sister vessels, and as already mentioned, we plan to replace them with younger tonnage.

Moving to Slide Six, in a volatile charter environment, we have chartered in total 24 vessels during the quarter. Although the containership market has been negatively affected by the COVID outbreak, there