Thank you for joining us for Navios Maritime Partners Third Quarter 2022 Earnings Conference Call. With us today from the company are Chairwoman and CEO, Ms. Angeliki Frangou; Chief Operating Officer, Mr. Stratos Desypris; Chief Financial Officer, Ms. Eri Tsironi; and Vice Chairman, Mr. Ted Petrone. As a reminder, this conference call is being webcast. To access the webcast, please go to the Investors’ section of the Navios Partners website at www.navios-mlp.com. You can see the webcasting link in the middle of the page and a copy of the presentation referenced in today’s earnings conference call will also be found there. Now, I will review the Safe Harbor statement. This conference call could contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Navios Partners. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are based upon the current beliefs and expectations of Navios Partners management and are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements. Such risks are more fully discussed in Navios Partners filings with the Securities and Exchange Commission. The information set forth herein should be understood in light of such risks. Navios Partners does not assume any obligation to update the information contained in this conference call. The agenda for today’s call is as follows: first, Ms. Frangou will offer opening remarks; next, Mr. Desypris will give an overview of Navios Partners segment data; next, Ms. Tsironi will give an overview of Navios Partners financial results; then Mr. Petrone will provide an operational update and industry overview; and lastly, we’ll open the call to take questions. Now, I’ll turn the call over to Navios Partners Chairwoman and CEO, Ms. Angeliki Frangou. Angeliki?

Thank you, Daniela, and good morning to all of you joining us on today’s call. We are pleased to report our results for the third quarter of 2022, in which we recorded $322.4 million of revenue and $257.2 million of net income. Net income amounts to $8.36 per unit. We are caught in the crossroads of unprecedented macro events. First, in terms of the general economic environment, central banks are reducing the existing liquidity in the financial system as they turn to normalize balances. At the same time, central banks are increasing interest rates to combat rising and enduring inflation. Second, China, the major consumer of raw materials and produces of [indiscernible] to much of the world has reduced appetite as it experiences slow economic growth and focuses on zero COVID policies. Finally, the conflict in Ukraine has disturbed normal trading patterns for oil and gas, while also creating a scarcity of grains and mineral commodities. In the face of these challenges are the sales side approach has helped as stakeholders well. We have about 16 different vessel types operating in three segments. The average age of vessels in each segment is below the industry average. In the container sector, we were able to take advantage of the market strength by selling two 60 year old containerships for $220 million. Given the appetite for containerships, we were able to order new vessels and hedging the ownership risk by charting them out for a long period ensuring a reasonable return on the investor. We also used our balance sheet strength to enter in the new tanker class, the Aframax because other tanker companies at the time were constrained by the legacy balancing issues. Today, we have six on another or we have long-term charters on four of them, we continue to…

Thank you, Angeliki, and good morning, all. Slide 9 details our strong operating free cash flow potential for the fourth quarter of 2022. We fixed 73.3% of available days at an average rate of $25,351 net per day. For Q4 2022 contracted revenue already exceeds total cash expenses by over $51 million. We have 4,022 available days that will provide additional profitability once we – for 2023, we have 60,591 available days approximately 65% of these are days with market exposure. Slide 10 demonstrates the basic principles of our diversified platform in action. We benefit from counter cyclicality, which creates opportunity to redeploy cash flow and from well performing segments into activities in underperforming segments. Asset values can be volatile in a diversified asset base moves the balanced volatility. We can see this dynamic now asset base as of Q3 2022 container values dropped by 42% and dry bulk dropped by 4% while tanker vessel values increased by 32%. In some the net change, our fleet values a decrease of approximately 14%. In addition, multiple segments allows us to optimize starting, in segments with attractive returns we can enter into period charter rates. In other segments, we can be pacing. As you can see from the chart on the bottom, the container segment was enjoying historically high charter rates. Not surprisingly, we fixed our container fleet on long-term charter with almost 90% of our available containers days fixed for 2023. This reduced market and residual risk, we manage the credit risk of the long-term charters independently to ensure we are not simply trading one risk for another. In our tanker segment, current charter rates are surpassing the 20-year average levels. We increase peaks in available tanker days to almost 40% for 2023, taking advantage of this market. We expect our…

Thank you, Stratos, and good morning, all. I will briefly review our unaudited financial results for the third quarter and nine month ended September 30, 2022. The financial information is included in the press release and is summarized in the slide presentation available on the company’s website. I would like to highlight that the 2022 results are not comparable to 2021. As in 2021, NMM acquired two companies and recently 36 bases significantly expanding its fleet. Moving to the earnings highlights in Slide 14, total revenue for the third quarter of 2022 increased by 41% to $322.4 million, compared to $228 million for the same period in 2021. Time charter revenue is understated because of a $13.6 million adjustment required for accounting purposes due to the straight line effect of container charters with deescalating rates. The overall revenue increased results from a 43% increase in available days to 12,897 compared to 9,027 for the same quarter last year. Our time charter equivalent rate decreased by 3% to 23,781 per day, compared to 24,447 per day for the same period in 2021. In terms of sector performance, both containers and tankers enjoyed rates that increased 45% period over period to 32,600 for containers and 21,828 tankers. In contrast, our drybulk fleet rate by 31% lower at $20,061. EBITDA for Q3 2022 increased by 81% to $321.4 million compared to $177.2 million for the same period last year. Excluding one of items are described in our press release adjusted EBITDA increased by $32.5 million to $177.7 million. Net income for Q3 2022 increased by 59% to $257.2 million, compared to $162.1 million for the same period in 2021. Per unit net income was $836, excluding one of items as detailed in the price release, adjusted net income was $113.4 million compared to…

Thank you, Eri. Please turn the Slide 21 for the review of the tanker industry. Tanker rates rose sharply in Q3 and rates today continue firm in all sizes for both crude and clean vessels. What has negatively affected the container industry has positively affected tankers. That is consumer activity has switched from purchasing goods to increasing travel and services. About two-thirds of Seaborne product trade is related to transportation. In spite of economic uncertainties in the Ukraine crisis, the IEA still projects a 2% increase in world oil demand for 2022. The expectation is that oil demand will grow by 1.7% in 2023 to 101.3 million barrels per day exceeding 2019 pre-pandemic levels. Turning to Slide 22, tanker rates continue across the board and have risen due to solid supply and demand fundamentals combined with the invasion of the Ukraine, which has redirected Russian crude and clean products to new and longer routes. Additional European refineries are replacing Russian crude and products with supply from the U.S. and Middle East Gulf further increasing ton miles and trade in efficiencies. Incremental support, the crude tanker rates should come into effect as new EU sanctions and a price cap begin on December 5. Product tankers should also be aided by discounted Russian crude exported to the far east, returning to the Atlantic as clean product. This could add upward pressure on already strong rates. 2023 crude and product ton mile growth is expected to increase by 5.3% and 9.5% respectively. Turning to Slide 23, vessel net fleet – VLCC net fleet growth is projected at 4.2% for 2022 and only 2% for 2023. This decline can be partially attributed to owner’s hesitance to order expensive long-lived assets in light of macroeconomic uncertainty and engine technology concerns due to upcoming CO2 restrictions.…

Thank you, Ted. This completes our presentation and will open the call to questions.

Thank you. [Operator Instructions] We’ll take our first question from Omar Nokta with Jefferies.

Thank you. Hi there. Hey guys. Good morning. Good afternoon.

Good morning. Good morning.

Morning. Yes, just – we’ve seen today your agreements to sell a handful of older drybulkers. You’re bringing in two younger ones. We’ve also added two more LR2 newbuildings, given I guess your diversified platform. I guess, we’ll be seeing this a lot more frequently going forward. Just generally, how do you see Navios now especially with the platform we have today? Got the strong earnings coming in from the tanker exposure, the solid cash flows from the containers, with secondhand prices coming under pressure here in the container market and then obviously some softness here in drybulk. Are there opportunities starting to develop where you could take advantage of this weakness or you maybe taking a bit more of a wait and see approach in looking at the secondhand market?

Actually, Omar, it is a very good question, but you have seen that we already have done an acquisition. We show the – we have a fleet of vessels on the both on the drybulk. We have taken a position which we saw that was quality vessels Japanese vessels, and we have them in the water waiting for the opportunity where with how China will develop, how the zero COVID restriction will be. And that will give us an opportunity on the sport market. Of course, we also have some newbuildings that provide us a more efficient vessel. On the container fleet grid, we see we have taken an approach of we saw earlier directions with we contracted our fleet and we sold at the appropriate time. So on the container sector, we are more – we have now positioned it in a situation where we enjoy cash flows. We have about $3 billion of contracted revenue, about $2 billion is from the containers, and we are enjoying this cash flow. On the tanker sector, as you very well said, we are in a position where we enjoying the spot market opportunity, while at the same time we did – we enter in a sector and we actually have built some very nice cash flows there. So it is totally opportunistic. We are – we see the opportunity and we move forward on disposing of assets and also on acquisition. On the drybulk and in our overall portfolio, one thing you will see very often, we will move from – we will be selling all the vessels, all the technology that they need CapEx and moving to younger fleet that it will inevitably be more better fuel consumption, better carbon footprint. So this is a trade that we’ll be doing constantly and you will see us doing it. That’s why we saw all the aggressive and we substitute with our younger tank size vessels. They are about 50% less – they consume less fuel. They have about 50% better carbon emissions.

Thanks, Angeliki. And then maybe just on the point there, the efficiency saw that you’ve now taken up your LR2 orders to six ships, and I just wanted to double check. Is it now the original four that were contracted maybe six months ago? Those are now chartered? And the latest two orders from today, those are under option to be contracted by the charter. Does that make sense? So four out of the six are officially chartered?

Yes, you’re absolutely right.

Okay. Thank you. Sorry. I just want to double check that. And then maybe just final question and it’s a – you’ll probably be getting this or you’ve gotten this in the past. But how do you think now about how are you using some of your excess free cash? We’ve seen, obviously you’ve been very dynamic with the fleet, but with the Navios Holdings, drybulk fleet now fully delivered into NMM as of September, how do you think about the $100 million buyback you got in place? Do you use that a bit more significantly now? Or does the pullback in containers, even though you’re contracted, but does the pullback there? Does the softness in drybulk, does that give you a bit of pause in buying back share?

We adopted the buyback because we wanted to have the flexibility. Yes, of course, because of macro certainties that we saw and the balance sheet consideration – that balance sheet considerations, we have not put it in that yet, but it’s something that we are looking. This is about Navios is concentrating on total returns. This is a very important thing and the decision of how we return to our shareholders, it depends on the value. But we are – this is something that we adopted because we wanted the flexibility to use it.

Okay. Thanks, Angeliki. I’ll turn that over.

Thank you.

Thank you. We’ll take our next question from [indiscernible] of Citi.

Hello. Good morning.

Good morning. Good morning.

So we were wondering if you could just touch on a little bit more about the softness in the container market right now. And where you really see that going? Not only in 4Q, but also if you could potentially shed some light on the first half of 2023. And also in addition to that, if you wouldn’t mind touching on the points of hedging out that new build risk with the longer-term charters. If you could just talk a little bit more on those two points that would be very helpful.

I will start with the container market. This is a market that to be honest we saw the opportunity of – we saw that people moved from the COVID period where we are all about products and purchases of products to services. Everyone is traveling, everyone is going to restaurant. So it was inevitable that we have a softer market and that’s why we contracted as we have hedged our position and we took possible ways of maximizing our returns. The short vessels, you saw the transaction of $220 million, which was completed in September and $220 million sale of – 2006 built container vessels. And also we contracted as new buildings. And one of the things that we did is we care – we have about some $3.2 billion contracted revenue. $2 billion is in the container sector, and of that is a very front loaded, about a $1 billion we’re going to get earn within the first two years. So it’s a very front loaded, because we see that now the companies are earning very well good money. So the balances are very good and we want to earn as soon as possible this amount. So we are very – we have a graded committee that we monitor all this, but we also have taken measures from the beginning, front-loaded and head the exposure.

Yes. Thank you very much for that. And then let’s see if you don’t mind just giving a little bit more detail, on your puts and takes on the bulk market, on one hand, bulk demand remains it remains strong, but softening so taking into consideration the supply issues, it’s likely going to put pressure on what you’re able to move. How would you break down this market dynamic, heading into the winter and the first half of next year?

I will give you a very macro level. I let Ted speak to all this, but one thing I’ll say is that today you have call, which is basically depends on the energy crisis in Europe. You’ll have more demand is an advertise there. And the other big issue is the zero-COVID policy in China. At the end of the story, China is a 50% buyer of all commodities. The moment you have an easier COVID strategy, you will see that this will create an opportunity on the drybulk and made on the larger vessel will be always, I don’t know, the larger commodities will be the driver of that market. And with that, I think Ted can give you a better details on this.

Sure. Thank you, Angeliki. Just taking step back on the macro, let’s just remember that the order book is under 7%. Net growth next year is going to be 0.5%. You may have some softness here into the winter, eventually China will fix the zero-COVID policy, whether now or in a couple of months. That’s why you’re seeing, the rates were have will come off a bit from the spring, but the actual S&P values have not, because there’s a lot of confidence that the market’s going to bounce back. They haven’t come down as much as the rates, and the rates are actually starting to move up a bit, I would say. And I think you’ll be seeing next year some really good grain ton mile increases of almost 5%. Coal’s going to be 3%. You’re seeing longer hole roots for two out the three, or the three majors coal and grain. Iron ore will not have a ton mile, but it should come back next year as China infrastructure projects take a hold in the spring and the COVID-zero policy goes away. So, I think there’s a lot of optimism, but you may have a soft touch in front of us right now.

Thank you very much. That’s very helpful. And then just finishing up, would you be able to break down the available days specifically within drybulk container and tanker for the quarter?

I will ask Eri to talk about this. One quick thing, I’ll, what I’ll give you on a macro level for 2023. You have a 6,000 breakeven per open day of which we have 40,000 days, 30,000 more or less on the drybulk and 10,000 on the tankers, which gives you a good outlook on our 2023 earning capacity. You want the Q3 or the Q4 quarter? Sorry, which quarter are you looking after?

We – so we were looking at the third quarter.

The third quarter. So roughly we have around 4,000 bank a day [ph] of which 1000 are the VLCC days, 901 days close to 2000 MR1 and MR2 days. And just below 200 chemical days. On the container side, we have 3,200 days. And this is the 10,000 day you will have a roughly to better. So it’s a bit more than 600 days, 2000 days in the 4,000 side, and then 600 days for 3450 [ph] and below. And then on the drybulk side, we have a roughly 6,000 days, I think.

Thank you very much. That’s very helpful.

I think we can take this and we can – that is around 2,000 days and then 3,000 Panamax days and the rest is [indiscernible].

Thank you very much.

And definitely you can – we can give you all your modeling questions so that you can reconcile your modeling.

Perfect. Thank you.

Thank you.

Thank you. I will now turn the floor back over to Angeliki for any additional or closing remarks.

Thank you. This completes Q3 results. Thank you very much.

This concludes today’s earnings call. We appreciate your participation. You may now disconnect.