Navigator Holdings Ltd. Preliminary Results for the Three and Six Months Ended June 30, 2019

LONDON, Aug. 8, 2019 /PRNewswire/ --

Highlights

    --  Navigator Holdings Ltd. (the "Company", "we", "us" and "our") (NYSE:
        NVGS) reported operating revenue of $73.6 million for the three months
        ended June 30, 2019, an increase from $73.2 million for the three months
        ended June 30, 2018.
    --  Net loss was $7.7 million (resulting in a loss per share of $0.14) for
        the three months ended June 30, 2019 compared to a net loss of $3.2
        million for the three months ended June 30, 2018.
    --  Adjusted EBITDA(1) was $23.2 million for the three months ended June 30,
        2019 compared to $27.2 million for the three months ended June 30, 2018.
    --  On May 8, 2019, a third long term throughput agreement was signed for
        the ethylene export marine terminal at Morgan's Point, Texas (the
        "Marine Export Terminal").

Ethylene Marine Export Terminal

On May 8, 2019, a third long term throughput agreement was signed for the Marine Export Terminal related to our 50/50 joint venture, with strong indications of demand for the remaining capacity. Commercial operations continue to be scheduled to begin in the fourth quarter of 2019, with the refrigerated storage tank expected to be completed in late 2020. It is anticipated that the Marine Export Terminal's throughput capacity during the first year of operation and prior to the cryogenic tank becoming operational will be between 60% to 75% of the total expected annual capacity of 1.0 million tonnes.

As of June 30, 2019, the Company had contributed $90.5 million of our expected $155.0 million share of the capital cost of the Marine Export Terminal construction from the Company's available cash resources and the 2018 Bonds. In July 2019, we contributed a further $12.5 million. We are scheduled to contribute an additional $31.0 million this year and to contribute the remaining $21.0 million of our expected share of the capital cost for the construction during 2020.

Appointment of Chief Executive Officer

On June 25, 2019, the Board of Directors (the "Board") of the Company. appointed Dr. Henry "Harry" Deans as Chief Executive Officer, effective August 22, 2019. David Butters, the Company's current President and Chief Executive Officer will relinquish that role to Dr. Deans on that date. Mr. Butters will continue as Executive Chairman of the Board. Dr. Deans was appointed a member of the Board in November 2018 and will continue as a member of the Board after the effectiveness of his appointment as Chief Executive Officer.

From 2006 to 2015, Dr. Deans held a series of positions as the chief executive officer of multiple affiliates and directly owned subsidiaries of INEOS Group Holdings S.A., a chemical company. From August 2015 to December 2017, Dr. Deans was the Senior Vice President of Agrium Inc., a fertilizer producer and distributor, prior to its merger with Potash Corporation of Saskatchewan to form Nutrien Ltd., where he served as the Executive Vice President and President of the nitrogen division from January 2018 to May 2018. From August 2015 to December 2017, he also served as a member of the board of directors of Canpotex Potash Export Company. Most recently Dr. Deans was Chief EHS and Operations Officer at Johnson Matthey PLC. Dr. Deans holds a Ph.D. and M.Phil. in chemistry from Strathclyde University as well as a B.Sc. in chemistry from Glasgow University.

Trends and Outlook

The headwinds from the first quarter carried into the second quarter with the global handysize spot market slowly incorporating the six vessels released from the Venezuelan cabotage trade as a consequence of sanctions the U.S. imposed upon Petroleos de Venezuela S.A. or "PdVSA". Such an increase in the supply of ships, especially in a segment with a total of 118 vessels on the water and with more than half trading under time charters, has restricted handysize market rates from increasing alongside other sectors. Continued European chemical plant turnarounds reduced traditional long-haul petrochemical exports to Asia and the import of U.S. ethylene which typically heads trans-Pacific, cutting handysize-ton mile demand.

As the LPG market strengthened, the usually more consistent petrochemical gas market faltered, as a number of unforeseeable elements combined to constrict trade flows. There have been a relatively high number of incidents at major terminals around the world in 2019. Italy, Turkey, the United States Gulf and East Coast, Mexico, Argentina, Malaysia and China have all endured misfortune and setbacks that disrupted product supply, receiving capacity and trade patterns.

In Europe, a larger than average turnaround season to the chemical industry has had both positive and negative effects for the shipping market. The increased demand for propylene in Europe surged, with 85,000 metric tonnes ("mt") shipped to North West Europe and another 5,000 mt to the West Mediterranean in the second quarter of 2019, a 50% increase on the levels in the first quarter of 2019. This propylene has been mainly shipped on handy-size semi-refrigerated vessels. We have also been shipping to Europe the majority of the ethylene lifted from Houston, with the landed pricing more attractive there than Asia. However, with European petrochemical production greatly diminished, the usual excess of butadiene regularly going to Asia has been limited as the poor arbitrage combined weak supply with lack of demand in Asia. Brazil continues to export healthy volumes of butadiene, propylene and ethylene.

The Very Large Gas Carrier ("VLGC") segment experienced increased supply of LPG volumes, especially from the U.S., which started to outweigh the supply of vessels. This surplus supply of LPG volumes relative to vessels ushered in a remarkable increase in rates to levels not seen since 2015. As the VLGC market rates rose, the Medium-size Gas Carrier ("MGC") market, started to see a tightening, with freight rates rising. There is a time-lag for these forces to positively impact the smaller handysize sector which we anticipate will occur later in 2019.

The handy-size (17-22,000 cbm) shipping market has seen many challenges during the first six months of 2019. It has not yet seen the improved charter rates that the VLGC sector currently enjoys, but neither has it suffered the lows of the VLGCs from six months ago. With VLGC spot earnings increasing from $1.0 million per calendar month ("pcm") to $2.1 million pcm over the second quarter and the MGC rates rising from $500,000 pcm to $650,000 pcm over the second quarter, the handy-size market's short-term overcapacity has certainly contributed to a decrease in our earnings in the second quarter as compared to the first quarter of 2019. However, as fully-refrigerated LPG volumes continue to rise at a steady pace, we expect to see the handy-size segment support this rise with the prospect of moving more vessels into the LPG market from the petrochemical market.

Second Quarter 2019 Financial Results Overview

The following table compares our operating results for the three months ended June 30, 2018 and 2019:


                                                                                                                                 
           
              Three Months      
      
        Three Months      
       
       Percentage
                                                                                                                                        
              Ended                
        Ended                
       Change
                                                                                                                                 
             
                June 30,      
        
          June 30,
                                                                                                                                                                 2018                      2019



                                                                                                                               
       (in thousands, except percentages)



     Operating revenue...................................................................................................                                    $73,163                   $73,586                     0.6 %



     Operating expenses:



     Brokerage commissions................................................................................                                                     1,219                     1,233                     1.1 %



     Voyage expenses.........................................................................................                                                 13,930                    16,437                    18.0 %



     Vessel operating expenses..........................................................................                                                      26,040                    27,448                     5.4 %



     Depreciation and amortization.......................................................................                                                     19,029                    18,913          
            (0.6 %)



     General and administrative costs..................................................................                                                        4,812                     5,195                     8.0 %




     Total operating expenses...................................................................                                                             $65,030                   $69,226                     6.5 %




     Operating income.....................................................................................................                                    $8,133                    $4,360                  (46.4 %)



     Foreign currency exchange loss on senior secured bonds.........................                                                                                                   (768 )



     Unrealized gain on non-designated derivative instruments..........................                                                                                                   861



     Interest expense...........................................................................................                                            (11,353)                (12,209 )                    7.5 %



     Interest income..............................................................................................                                               207                       205          
            (1.0 %)




     Loss before taxes and share of result of equity accounted joint venture                                                                                $(3,013)                $(7,551 )                  150.6 %



     Income taxes............................................................................................................                                 (146 )                     (81)                 (44.5 %)



     Share of result of equity accounted joint venture...................................................                                                                              (101 )




     Net loss..........................................................................................................                                     $(3,159)                 $(7,733)                  144.8 %

Operating Revenue. Operating revenue, net of address commission, increased by $0.4 million or 0.6% to $73.6 million for the three months ended June 30, 2019, from $73.2 million for the three months ended June 30, 2018. This increase was principally due to:

    --  an increase in operating revenue of approximately $2.6 million
        attributable to an increase in average charter rates, which increased to
        an average of approximately $606,572 per vessel per calendar month
        ($19,940 per day) for the three months ended June 30, 2019 compared to
        an average of approximately $580,673 per vessel per calendar month
        ($19,089 per day) for the three months ended June 30, 2018;
    --  a decrease in operating revenue of approximately $3.4 million
        attributable to a decrease in fleet utilization from 90.3% during the
        three months ended June 30, 2018 to 85.2% during the three months ended
        June 30, 2019;
    --  a decrease in operating revenue of approximately $1.3 million
        attributable to a decrease in vessel available days of 72 days or 2.6%
        for the three months ended June 30, 2019 as three vessels were in
        drydock, compared to the three months ended June 30, 2018 when one
        vessel was in drydock; and
    --  an increase in operating revenue of approximately $2.5 million primarily
        attributable to an increase in pass through voyage costs as the number
        and duration of voyage charters during the three months ended June 30,
        2019 increased, as compared to the three months ended June 30, 2018.

The following table presents selected operating data for the three months ended June 30, 2018 and 2019, which we believe are useful in understanding the basis for movement in our operating revenue.


                                                       Three Months                   Three Months
                                                     
        
               Ended          
                 Ended

                                                              
             
           June                     June 30, 2019
                                                                    30, 2018




     
                Fleet Data:



     Weighted average number of vessels                                        38.0                               38.0



     Ownership days                                                           3,458                              3,458



     Available days                                                           3,434                              3,362



     Operating days                                                           3,103                              2,866



     Fleet utilization                                                        90.3%                             85.2%



     Average daily time charter equivalent rate (*)                         $19,089                            $19,940

* Non-GAAP Financial Measure--Time charter equivalent: Time charter equivalent ("TCE") rate is a measure of the average daily revenue performance of a vessel. TCE is not calculated in accordance with U.S. GAAP. For all charters, we calculate TCE by dividing total operating revenues, less any voyage expenses, by the number of operating days for the relevant period. Under a time charter, the charterer pays substantially all of the vessel voyage related expenses, whereas for voyage charters, also known as spot market charters, we pay all voyage expenses. TCE rate is a shipping industry performance measure used primarily to compare period-to-period changes in a company's performance despite changes in the mix of charter types (i.e., spot charters, time charters and contracts of affreightment) under which the vessels may be employed between the periods. We include average daily TCE rate, as we believe it provides additional meaningful information in conjunction with net operating revenues, because it assists our management in making decisions regarding the deployment and use of our vessels and in evaluating their financial performance. Our calculation of TCE rate may not be comparable to that reported by other companies.

Reconciliation of Operating Revenue to TCE rate

The following table represents a reconciliation of operating revenue to TCE rate. Operating revenue is the most directly comparable financial measure calculated in accordance with U.S. GAAP for the periods presented.




                                                             
              
                Three Months            
        
            Three Months
                                                              
                
                  Ended               
         
               Ended
                                                                 
                  June 30, 2018                   
         June 30, 2019



                                                                        (in thousands, except operating days
                                                                         and
                                                 average daily time charter equivalent
                                                 rate)



     
                Fleet Data:



     Operating revenue                                                                              $73,163                          $73,586



     Voyage expenses                                                                                 13,930                           16,437




     Operating revenue less Voyage expenses                                                          59,233                           57,149




     Operating days                                                                                   3,103                            2,866



     Average daily time charter equivalent rate                                                     $19,089                          $19,940

Reconciliation of Non-GAAP Financial Measures

The following table sets forth a reconciliation of net income to EBITDA and Adjusted EBITDA for the three months ended June 30, 2018 and 2019:


                                                               
       (in thousands)


                                                                 
        June 30,           
     June 30,

                                                                                    2018                 2019



     Net loss                                                                  $(3,159)            $(7,733)



     Net interest expense                                                        11,146               12,004



     Income taxes                                                                   146                   81



     Depreciation and amortization                                               19,029               18,913




     
                EBITDA
                (1)                                         27,162               23,265



     Foreign currency exchange loss on senior secured bonds                                             768



     Unrealized gain on non-designated derivative instruments                                         (861)





     
                Adjusted EBITDA
                (1)                               $27,162              $23,172

[1] EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA represents net income before net interest expense, income taxes and depreciation and amortization. We define Adjusted EBITDA as EBITDA before any foreign currency exchange gain or loss on senior secured bonds and unrealized gain or loss on non-designated derivative instruments. Management believes that EBITDA and Adjusted EBITDA are useful to investors in evaluating the operating performance of the Company. EBITDA and Adjusted EBITDA do not represent and should not be considered as alternatives to any financial measure prepared in accordance with U.S. GAAP, and our calculation of EBITDA and Adjusted EBITDA may not be comparable to that reported by other companies. See the table above for a reconciliation of EBITDA and Adjusted EBITDA to net income/(loss), our most directly comparable financial measure calculated accordance with U.S. GAAP.

Our Fleet



     
                Operating Vessel                          Year                                                   Employment                               Charter
                                                                                                                            Status                 
                    Expiration Date
                                                                                    (cbm)
                                                                  Built Vessel Size



     
                Ethylene/ethane capable semi-refrigerated



     Navigator Orion (formerly known as Navigator Mars)           2000             22,085 
     Time charter                                      
          October 2020



     Navigator Neptune                                            2000             22,085 
     Spot market



     Navigator Pluto                                              2000             22,085 
     Time charter                                      
          January 2020



     Navigator Saturn                                             2000             22,085 
     Contract of affreightment                          
          April 2020



     Navigator Venus                                              2000             22,085 
     Time charter                                     
          November 2020



     Navigator Atlas                                              2014             21,000 
     Spot market



     Navigator Europa                                             2014             21,000 
     Spot market



     Navigator Oberon                                             2014             21,000 
     Spot market



     Navigator Triton                                             2015             21,000 
     Contract of affreightment                          
          April 2020



     Navigator Umbrio                                             2015             21,000 
     Contract of affreightment                          
          April 2020



     Navigator Aurora                                             2016             37,300 
     Time charter                          
     December 2026



     Navigator Eclipse                                            2016             37,300 
     Time charter                                      
          August 2019



     Navigator Nova                                               2017             37,300 
     Time charter                                      
          January 2020



     Navigator Prominence                                         2017             37,300 
     Time charter                                      
          October 2019





     
                Semi-refrigerated



     Navigator Magellan                                           1998             20,700 
     Time charter                                      
          August 2019



     Navigator Aries                                              2008             20,750 
     Time charter                                        
          May 2020



     Navigator Capricorn                                          2008             20,750 
     Time charter                                     
          November 2019



     Navigator Gemini                                             2009             20,750 
     Spot market



     Navigator Pegasus                                            2009             22,200 
     Spot market



     Navigator Phoenix                                            2009             22,200 
     Time charter                                     
          September 2019



     Navigator Scorpio                                            2009             20,750 
     Spot market



     Navigator Taurus                                             2009             20,750 
     Time charter                                     
          September 2019



     Navigator Virgo                                              2009             20,750 
     Time charter                                      
          August 2019



     Navigator Leo                                                2011             20,600 
     Time charter                                     
          December 2023



     Navigator Libra                                              2012             20,600 
     Time charter                                     
          December 2023



     Navigator Centauri                                           2015             21,000 
     Spot market



     Navigator Ceres                                              2015             21,000 
     Spot market



     Navigator Ceto                                               2016             21,000 
     Spot market



     Navigator Copernico                                          2016             21,000 
     Spot market



     Navigator Luga                                               2017             22,000 
     Time charter                                     
          February 2022



     Navigator Yauza                                              2017             22,000 
     Time charter                                       
          April 2022





     
                Fully-refrigerated



     Navigator Glory                                              2010             22,500 
     Time charter                                       
          June 2021



     Navigator Grace                                              2010             22,500 
     Spot market



     Navigator Galaxy                                             2011             22,500 
     Time charter                                       
          April 2020



     Navigator Genesis                                            2011             22,500 
     Time charter                                       
          June 2020



     Navigator Global                                             2011             22,500 
     Time charter                                     
          November 2020



     Navigator Gusto                                              2011             22,500 
     Time charter                                      
          October 2019



     Navigator Jorf                                               2017             38,000 
     Time charter                                      
          August 2027

Conference Call Details:

Tomorrow, Friday, August 9, 2019, at 9:00 A.M. ET, the Company's management team will host a conference call to discuss the financial results.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 (877) 553-9962 (US Toll Free Dial In), 0(808) 238-0669 (UK Toll Free Dial In) or +44 (0) 2071 928 592 (Standard International Dial In). Please quote "Navigator" to the operator. There will also be a live, and then archived, webcast of the conference call, available through the Company's website (www.navigatorgas.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

A telephonic replay of the conference call will be available until Friday, August 16, 2019, by dialing 1(866) 331-1332 (US Toll Free Dial In), 0(808) 238-0667 (UK Toll Free Dial In) or +44 (0) 3333 009 785 (Standard International Dial In). Access Code: 11870348#

Navigator Gas

Attention: Investor Relations Department

New York: 650 Madison Ave, 25th Floor, New York, NY 10022. Tel: +1 212 355 5893
London: 10 Bressenden Place, London, SW1E 5DH. Tel: +44 (0)20 7340 4850

About Us

Navigator Holdings Ltd. is the owner and operator of the world's largest fleet of handysize liquefied gas carriers and a global leader in the seaborne transportation of petrochemical gases, such as ethylene and ethane, liquefied petroleum gas ("LPG") and ammonia. Navigator's fleet consists of 38 semi- or fully-refrigerated liquefied gas carriers, 14 of which are ethylene and ethane capable. The Company plays a vital role in the liquefied gas supply chain for energy companies, industrial consumers and commodity traders, with our sophisticated vessels providing an efficient and reliable 'floating pipeline' between the parties. We continue to build strong, long-term partnerships based on mutual trust, our depth of technical expertise and a modern versatile fleet.


                                                                                                                
         
            Navigator Holdings Ltd.




                                                                                                              
       
         Condensed Consolidated Balance Sheets


                                                                                                                    
       
                (Unaudited)


                                                                                                                                                                   
              December 31, 2018 
     June 30, 2019


                                                                                                                                                              (in thousands, except share data)



           
                Assets



           
                Current assets



           Cash and cash equivalents                                                                                                                                                   $71,515          $47,285



           Accounts receivable, net                                                                                                                                                     17,033           20,166



           Accrued income                                                                                                                                                                4,731            1,859



           Prepaid expenses and other current assets                                                                                                                                    16,057           25,433



           Bunkers and lubricant oils                                                                                                                                                    8,789           10,249




           Total current assets                                                                                                                                                        118,125          104,992



           
                Non-current assets



           Vessels in operation, net                                                                                                                                                 1,670,865        1,639,755



           Property, plant and equipment, net                                                                                                                                            1,299            1,167



           Investment in equity accounted joint venture                                                                                                                                 42,462           93,814



           Right-of-use asset for operating leases                                                                                                                                           -           7,297

                                                                                                                                                                                                            ---


           Total non-current assets                                                                                                                                                  1,714,626        1,742,033




           
                Total assets                                                                                                                                                $1,832,751       $1,847,025

                                                                                                                                                                                                            ===




           
                Liabilities and stockholders' equity



           
                Current liabilities



           Current portion of secured term loan facilities, net of deferred financing costs                                                                                            $68,857          $67,827



           Current portion of operating lease liabilities                                                                                                                                    -           1,115



           Accounts payable                                                                                                                                                             10,784           13,451



           Accrued expenses and other liabilities                                                                                                                                       12,798           13,055



           Accrued interest                                                                                                                                                              4,613            4,701



           Deferred income                                                                                                                                                               8,342            6,842




           Total current liabilities                                                                                                                                                   105,394          106,991






           
                Non-current Liabilities



           Secured term loan facilities and revolving credit facilities, net of current portion and deferred                                                                           599,676          616,573
      financing costs



           Senior secured bond, net of deferred financing costs                                                                                                                         68,378           69,311



           Senior unsecured bond, net of deferred financing costs                                                                                                                       99,039           99,266



           Derivative liabilities                                                                                                                                                        5,154            3,509



           Operating lease liabilities, net of current portion                                                                                                                               -           6,674

                                                                                                                                                                                                            ---


           Total non-current liabilities                                                                                                                                               772,247          795,333




           
                Total Liabilities                                                                                                                                              877,641          902,324



           
                Commitments and contingencies (see note 13)



           
                Stockholders' equity



           Common stock-$.01 par value per share; 400,000,000 shares authorized; 55,832,069 shares issued                                                                                  557              558
      and outstanding, (2018: 55,657,631)



           Additional paid-in capital                                                                                                                                                  590,508          591,254



           Accumulated other comprehensive loss                                                                                                                                         (363 )          (393 )



           Retained earnings                                                                                                                                                           364,408          353,282




           Total stockholders' equity                                                                                                                                                  955,110          944,701




           
                Total liabilities and stockholders' equity                                                                                                                  $1,832,751       $1,847,025

                                                                                                                                                                                                            ===


                                                                                        
              
                Navigator Holdings Ltd.




                                                                              
              
                Condensed Consolidated Statements of Income


                                                                                              
              
                (Unaudited)




                                                                                                                                                  
            Three months ended                   
            Six months ended

                                                                                                                                                     
              June 30,                            
            June 30,

                                                                                                                                                       (in thousands except share and per                 (in thousands except share and
                                                                                                                                                                  share                                         per
                                                                                                                                                            data)                                     share data)


                                                                                                                                                          2018                  2019            2018                                      2019

                                                                                                                                                                                                                                        ---


           
                Revenues



           Operating revenue.........................................................................................                                 $73,163               $73,586        $150,970                                  $149,689






           
                Expenses



           Brokerage commissions.................................................................................                                       1,219                 1,233           2,360                                     2,542



           Voyage expenses...........................................................................................                                  13,930                16,437          28,908                                    29,794



           Vessel operating expenses.............................................................................                                      26,040                27,448          52,751                                    56,922



           Depreciation and amortization..........................................................................                                     19,029                18,913          38,410                                    37,861



           General and administrative costs.....................................................................                                        4,812                 5,195           9,258                                     9,997

                                                                                                                                                                                                                                        ---


           
                Total operating expenses...........................................................................                            65,030                69,226         131,687                                   137,116

                                                                                                                                                                                                                                        ---


           
                Operating income.........................................................................................                       8,133                 4,360          19,283                                    12,573



           
                Other income/(expense)



           Foreign currency exchange loss on senior secured bonds                                                                                                            (768)                                                   (952)



           Unrealized gain on non-designated derivative instruments                                                                                                            861                                                    1,645



           Interest expense...............................................................................................                           (11,353)             (12,209)       (21,877)                                 (24,362)



           Interest income..................................................................................................                              207                   205             359                                       420

                                                                                                                                                                                                                                        ---




           
                Loss before income taxes and share of result of equity                                                                        (3,013)             (7,551 )        (2,235)                                 (10,676)
      accounted joint venture...........................................................................



           Income taxes......................................................................................................                           (146)                 (81)          (228)                                    (174)



           Share of result of equity accounted joint venture..............................................                                                                   (101)                                                   (140)




           
                Net loss.............................................................................................................        $(3,159)             $(7,733)       $(2,463)                                $(10,990)






           (Loss)/Earnings per share:



           Basic:..................................................................................................................                   $(0.06)              $(0.14)        $(0.04)                                  $(0.20)



           Diluted:................................................................................................................                   $(0.06)              $(0.14)        $(0.04)                                  $(0.20)






           Weighted average number of shares outstanding:



           Basic:..................................................................................................................                55,656,304            55,832,069      55,601,772                                55,756,897



           Diluted:................................................................................................................                55,656,304            55,832,069      55,601,772                                55,756,897

                                                                                                                                                                                                                                        ===


                                                                                                       
       
                Navigator Holdings Ltd.




                                                                                                    
     
         Condensed Consolidated Statements of Cash Flows


                                                                                                         
           
                (Unaudited)




                                                                                                                                                            
       Six Months ended          
       Six Months ended
                                                                                                                                                               June 30,                      June 30,
                                                                                                                                                                                     2018                           2019

                                                                                                                                                                                                                    ---

                                                                                                                                                             
       (in thousands)            
       (in thousands)



     
                Cash flows from operating activities



     Net loss                                                                                                                                                                   $(2,463)                    $(10,990 )





     
                Adjustments to reconcile net income to net cash provided by operating activities



     Unrealized gain on non-designated derivative instruments                                                                                                                          -                      (1,645 )



     Depreciation and amortization                                                                                                                                                38,410                         37,861



     Payment of drydocking costs                                                                                                                                                (2,880 )                      (5,160 )



     Prior year expenses recovered in insurance claim                                                                                                                              (754)                             -



     Amortization of share-based compensation                                                                                                                                        366                            747



     Amortization of deferred financing costs                                                                                                                                      1,131                          1,473



     Share of result of equity accounted joint venture                                                                                                                                 -                           140



     Unrealized foreign exchange loss on senior secured bonds                                                                                                                          -                           952



     Other unrealized foreign exchange gain                                                                                                                                        (30 )                          (47)



     
                Changes in operating assets and liabilities



     Accounts receivable                                                                                                                                                           3,392                       (3,133 )



     Bunkers and lubricant oils                                                                                                                                                      886                       (1,460 )



     Accrued income and prepaid expenses and other current assets                                                                                                                  1,354                       (4,013 )



     Accounts payable, accrued interest, accrued expenses and other liabilities                                                                                                    3,734                          2,012




     
                Net cash provided by operating activities                                                                                                                       43,146                         16,737






     
                Cash flows from investing activities



     Additions to vessels and equipment                                                                                                                                             (79)                      (1,396 )



     Investment in equity accounted joint venture                                                                                                                              (10,475 )                     (51,491 )



     Purchase of other property, plant and equipment                                                                                                                               (97 )                        (191 )



     Insurance recoveries                                                                                                                                                            305                            130




     
                Net cash used in investing activities                                                                                                                        (10,346 )                     (52,948 )






     
                Cash flows from financing activities



     Proceeds from secured term loan facilities and revolving credit facilities                                                                                                    3,800                        127,000



     Issuance costs of secured bond                                                                                                                                                    -                        (136 )



     Issuance costs of secured term loan facilities                                                                                                                                    -                      (1,448 )



     Issuance costs of terminal credit facility                                                                                                                                        -                      (2,723 )



     Repayment of secured term loan facilities and revolving credit facilities                                                                                                 (43,613 )                    (110,712 )




     
                Net cash (used in)/provided by financing activities                                                                                                          (39,813 )                        11,981




     
                Net decrease in cash, cash equivalents and restricted cash                                                                                                    (7,013 )                     (24,230 )



     
                Cash, cash equivalents and restricted cash at beginning of period                                                                                               62,109                         71,515




     
                Cash, cash equivalents and restricted cash at end of period                                                                                                    $55,096                        $47,285

                                                                                                                                                                                                                    ===




     
                Supplemental Information



     Total interest paid during the period, net of amounts capitalized                                                                                                           $20,799                        $22,776

                                                                                                                                                                                                                    ===


     Total tax paid during the period                                                                                                                                                $52                           $165

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FORWARD LOOKING STATEMENTS

This press release contains certain forward-looking statements concerning plans and objectives of management for future operations or economic performance, or assumptions related thereto, including our financial forecast. In addition, we and our representatives may from time to time make other oral or written statements that are also forward-looking statements. Such statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business and the markets in which we operate as described in this press release. In some cases, you can identify the forward-looking statements by the use of words such as "may," "could," "should," "would," "expect," "plan," "anticipate," "intend," "forecast," "believe," "estimate," "predict," "propose," "potential," "continue," "scheduled," or the negative of these terms or other comparable terminology. Forward-looking statements appear in a number of places in this press release. These risks and uncertainties include, but are not limited to:

    --  future operating or financial results;
    --  pending acquisitions, business strategy and expected capital spending;
    --  operating expenses, availability of crew, number of off-hire days,
        drydocking requirements and insurance costs;
    --  fluctuations in currencies and interest rates;
    --  general market conditions and shipping market trends, including charter
        rates and factors affecting supply and demand;
    --  our ability to remain in compliance with the financial covenants within
        our secured term loan facilities, revolving credit facilities and bond
        agreements or to successfully refinance or obtain waivers thereunder, if
        necessary;
    --  our financial condition and liquidity, including our ability to
        refinance our indebtedness as it matures or obtain additional financing
        in the future to fund capital expenditures, acquisitions and other
        corporate activities;
    --  estimated future capital expenditures needed to preserve our capital
        base;
    --  our expectations about the availability of vessels to purchase, the time
        that it may take to construct new vessels, or the useful lives of our
        vessels;
    --  our continued ability to enter into long-term, fixed-rate time charters
        with our customers;
    --  changes in governmental rules and regulations or actions taken by
        regulatory authorities;
    --  compliance with all applicable sanctions and embargo laws and
        regulations;
    --  potential liability from future litigation;
    --  our expectations relating to the payment of dividends;
    --  our expectation regarding providing in-house technical management for
        certain vessels in our fleet and our success in providing such in-house
        technical management;
    --  our expectations regarding the construction and financing of the Marine
        Export Terminal, the financing of our investment in the Marine Export
        Terminal and the financial success of the Marine Export Terminal and our
        related 50/50 joint venture with Enterprise Products Partners L.P.; and
    --  other factors detailed from time to time in other periodic reports we
        file with the Securities and Exchange Commission.

Our secured term loan facilities, revolving credit facilities and bond agreements impose operating and financial restrictions on us and require us to maintain various financial ratios. These include requirements that we maintain specified maximum ratios of net debt to total capitalization, specified minimum levels of cash and cash equivalents (including undrawn lines of credit with maturities greater than 12 months), specified minimum ratios of consolidated earnings before interest, taxes, depreciation and amortization (consolidated EBITDA), to consolidated interest expense and specified minimum levels of collateral coverage. These facilities also include customary events of default related to cross-defaults to other indebtedness. Our compliance with such financial covenants is measured as of the end of each fiscal quarter. The failure to comply with such covenants would cause an event of default that could materially adversely affect our business, financial condition and operating results. Please read "Item 5--Operating and Financial Review and Prospects--B. Liquidity and Capital Resources--Financial Covenants in our 2018 Annual Report. As of June 30, 2019, we were in compliance with all covenants under the secured term loan facilities, revolving credit facilities and bond agreements.

While we expect that we will be in compliance with all covenants under the secured term loan facilities, revolving credit facilities and bond agreements as of the end of the forthcoming quarters, we expect that our ratio of consolidated EBITDA to consolidated interest expense at the end of each such quarter will be substantially near the required minimum under our unsecured bond agreement. There can be no assurance that we will be in compliance with this covenant under the unsecured bond.

All forward-looking statements included in this press release are made only as of the date of this press release. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement. We expressly disclaim any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in our views or expectations, or otherwise. We make no prediction or statement about the performance of our common stock.

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SOURCE Navigator Gas