Business Context and Reporting Period
This Form 6-K filing by Costamare Inc. (NYSE: CMRE) covers the period of July 2011, specifically referencing a press release dated July 18, 2011. Costamare is a leading owner and provider of containerships for charter, operating a fleet of 59 vessels with a total capacity of approximately 325,000 TEU, including 10 newbuilds on order.
Key Financial Metrics and Fleet Developments
- Acquisition: Agreed to purchase a 5,000 TEU secondhand containership (MSC Linzie, to be renamed MSC Romanos) for approximately $55 million.
- Financing: The acquisition is expected to be funded by cash from operations and an undrawn credit line.
- Charter Agreements: Secured new and extended charters totaling approximately $181 million in contracted revenues with an average duration of five years.
- Dividend: Management recommends an 8% increase in the quarterly dividend from $0.25 to $0.27 per common share, effective with the third quarter of 2011.
- Liquidity and Debt: The company currently holds 18 vessels free of debt. The filing does not provide specific total debt, cash balance, or liquidity ratios for the period.
Specific Charter Details
- MSC Romanos (New Acquisition): 63-month time charter at $28,000 per day.
- MSC Mykonos: Extended charter until September 1, 2017, at $20,000 per day.
- MSC Mandraki: Extended charter until July 1, 2017, at $20,000 per day.
- Akritas: Extended charter for 36 months at $12,500 per day.
- Rena: New five-year charter at $15,000 per day.
- Zagora: New eight-month charter at $7,000 per day.
Material Changes and Management Commentary
Management highlighted that the new acquisition is accretive to earnings and cash flow per share. The aggregate of new and extended charters enhances financial stability and dividend distribution capacity. The company noted that it has fixed all but one of its vessels for 2011. Management emphasized the flexibility of their business model to monetize debt-free vessels to invest in modern secondhand vessels while awaiting newbuilding deliveries.
Risks and Contingencies
The filing includes standard forward-looking statements regarding future results, noting that actual results may differ materially due to inherent uncertainties. Investors are directed to the "Risk Factors" section of the Annual Report on Form 20-F for a detailed discussion of risks affecting future results. No specific new contingencies or unusual items were detailed in this filing beyond standard market risks.
Investor Verification Checklist
- Verify the closing date and final purchase price of the MSC Romanos acquisition.
- Confirm the Board of Directors' formal approval of the 8% dividend increase.
- Review the utilization status of the undrawn credit line mentioned for financing the acquisition.
- Monitor the delivery schedule of the 10 newbuild containerships currently on order.
- Assess the impact of the new charters on the company's overall fleet utilization rate for 2011.