Navios Maritime Partners L.P.

Overview Key strengths Key risks Larger and more diversified fleet than rated peers with exposure to three distinct shipping segments (dry bulk, container, and oil/oil products), which helps to partly mitigate volatility. Exposure to the highly volatile and fragmented shipping sector, which faces frequent supply/demand imbalances. Competitive and predictable fleet running costs. Risk of charter rate amendments or defaults because the credit quality of container shipping counterparties will likely weaken in 2024-2025. Solid S&P Global Ratings-adjusted funds from operations (FFO) to debt of 30%-40% in 2023-2024, potentially exceeding this level in 2025 if management will prioritize structural debt reduction over capital expenditure (capex) and shareholder returns. High forecast capex related to new ships will likely increase S&P Global Ratings-adjusted debt

...We forecast that Navios Maritime Partners' (Navios) credit ratios will slightly improve in 2024 due to higher EBITDA from an expanded vessel fleet. The company's S&P Global Ratings- adjusted FFO to debt of about 33% in 2023 was slightly below our expectations, partly due to weaker dry bulk shipping rates than we had previously included in our base-case. We forecast that Navios will slightly improve its adjusted FFO to debt to the 34%-38% range in 2024 underpinned by an increase in its pro forma S&P Global Ratings-adjusted EBITDA to $860 million-$900 million (from about $760 million in 2023). This mainly reflects the company's 14 planned new ship deliveries in 2024 (10 containerships and four tankers) and our assumption that its combined average one-year time charter rate of $22,337 per day in 2023 will be broadly stable, with higher dry bulk rates (especially for Capesize vessels) offset by lower--but still favorable--contracted container shipping rates. Under our base-case scenario, we...

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