Costamare Inc. Q2 FY2025 earnings call

• Successfully completed spin-off of Costamare Bulkers in May. - In July, ordered 4 newbuilding containerships (3,100 TEU capacity) to be delivered between 2027 Q2-Q4, commencing 8-year time charter with a liner company. - Chartered two 6,500 TEU containerships for 3 years starting Q1 and Q2 2026, increasing contracted revenues by ~$310 million. - Fleet deployment at 100% for 2025 and 75% for 2026. - Containership fleet is fully employed with less than 1% commercially idle. - Neptune Maritime Leasing has 47 shipping assets funded/committed with total commitments over $650 million.

During the second quarter, Costamare Inc. generated net income of about $99 million, with adjusted net income around $92 million. The containership segment: fleet deployment is 100% for 2025 and 75% for 2026, total contracted revenues amount to $2.5 billion with a remaining time charter duration of about 3.2 years. Neptune Maritime Leasing: 47 shipping assets have been funded or committed and total commitments and investments are exceeding $650 million. Revenue contribution details: Containerships are the main segment with significant contracted revenues, and Neptune Maritime Leasing is a growing platform.

• Ordered 4 new 3,100 TEU containerships to be delivered 2027 Q2-Q4, commencing 8-year charters. - Chartered two 6,500 TEU vessels starting 2026 Q1 and Q2, increasing contracted revenues by ~$310 million. - Fleet deployment 100% in 2025 and 75% in 2026. - Total contracted revenues stand at $2.5 billion with remaining time charter duration ~3.2 years.

• Low fixing activity mainly due to low availability of prompt tonnage rather than lack of demand. - General market conditions affecting asset prices and investment decisions.

Q: You spun off the dry bulkers now. You're placing these orders for the 4 containerships. Is this a renewed effort now that you're back to almost effectively a pure-play container company? Or was this more of an isolated opportunity?

A: Okay. No, I don't think it is a shift in focus. We didn't put any newbuilding orders in containers during COVID or after COVID, simply because we found asset prices to be extremely high compared to the charter rates that were available combined with the charter rate period. This deal for the four 3,000 TEU vessels in terms of price, in terms of counterparty, in terms of charter period on a back-to-back basis made sense. So it's not that we shifted focus. We have been focusing on containers. It's just that asset values at those levels we've seen up to now didn't make much sense. Now if there is a correction in the market or if we find similar transactions that we feel make sense, we will definitely proceed. So the main reason had nothing to do with the dry bulk. It had to do mainly with elevated asset prices in the market.

Q: You've continued to deploy capital into Neptune Maritime Leasing, and you're now at around 90% of the capital you initially committed. Could you talk a bit about how the venture is developing and about whether there is potential to increase your investment above the amount you initially committed?

A: Yes. I mean -- I think that Neptune has been progressing well. We have -- in total, we have been far more committed to fund 47 vessels from various sizes and various types of assets. You are right, we have employed close to 90% of our initially committed capital. So far, this investment goes well, now whether we're going to be employing more and at what terms, et cetera, I'm not prepared to tell you now. But, in general, I think that this investment has been going as initially planned a couple of years ago. And I have to remind you that all this growth has been affected in a relatively shorter time period.

Q: Given the increased visibility you now have on the business after spinning off the bulk side, should we expect any changes on shareholder returns, be it on the dividend or with more share repurchases?

A: I think the dividend policy -- first of all, this is a Board decision, which is repeating the dividend policy periodically. But the dividend policy remains the same, irrespective of like whether we had the dry bulk vessels or sort of in a spun-off entity. We were paying and we still pay $0.115 per share per quarter, which we do feel is a healthy dividend. But of course, I cannot exclude any changes in the dividend policy being in terms of share buybacks or sort of dividend increases, et cetera, but this is subject to the Board's decision. We do pay dividends, but at the same time, we feel that an accretive deployment of our capital should be invested into new business rather than paying one-off dividends.