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Navios Partners scraps cash payouts, talks up acquisitions

Navios Partners scraps cash payouts, talks up acquisitions
Navios Maritime Partners has elected to suspend quarterly cash distributions as it focuses on saving cash and the possibility for acquisitions.

Navios Partners reported a full year net profit of $41.8m in 2015 down from $74.9m in 2014. Revenues for 2015 were down slightly at $223.7m compared to $227.3m in the previous year.

Looking ahead the company has already contracted 79.5% of its available voyage days for 2016, 57.2% for 2017 and 49.9% for 2018 with an average charter length of 3.2 years.

Despite this however, Navios Partners made what ceo Angeliki Frangou described as a “necessary, but painful decision” to scrap its remaining quarterly distributions, including that for Q4 2015, given “our untenable cost of capital, the inability to know when markets will restore and the opportunities to acquire assets at attractive prices.”

“We did not take this decision lightly,” Frangou continued. “However, we believe that reallocating cashflow to growth opportunities is in the best long-term interests of unitholders when Navios Partners does not have access to equity capital. Moreover, given current distressed market conditions, we believe that Navios Partners can be a unique platform for growth.

“While unitholders will forego near-term cash flows, Navios Partners should be able to create meaningful future distributable cashflow, whether through capital gains or a healthy charter market, assuming the market improves overtime.”

The company said it would reassess its distribution policy if the environment changes.