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Company Presentation
November 2012
Navios South American Logistics Inc.
2
This presentation contains forward-looking statements (as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) concerning future events and Navios South American Logistics, Inc.’s (“Navios Logistics”, “NSAL”, or the “Company”) growth strategy and measures to implement such strategy; including expected vessel acquisitions and entering into further time charters. Words such as “expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,” “estimates,” and variations of such words and similar expressions are intended to identify forward-looking statements. Such statements include comments regarding expected revenues and time charters. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates which are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to changes in the demand for barge, pushboat and product tanker vessels; competitive factors in the market in which the Company operates; weather-related risks; risks associated with operations outside the United States; and other factors listed from time to time in the Company’s filings with the Securities and Exchange Commission. The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. For the selected financial data presented herein, Navios Logistics compiled consolidated statements of operation and selected balance sheets for the relevant periods.
EBITDA represents Net Income/(Loss) attributable to Navios Logistics’ stockholders before interest, taxes, depreciation and amortization. EBITDA is presented because it is used by certain investors to measure a company's operating performance. EBITDA is a “non-GAAP financial measure” and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity. While EBITDA is frequently used as a measure of operating performance, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.
Forward Looking Statements
3
Navios Logistics Overview
Creating Shareholder Value: Navios Group
4
Navios Maritime Acquisition Corp.
(NYSE: NNA)
• Navios entity in tanker sector
• Fleet of 29 vessels: 7 VLCC, 20 product
tankers, 2 chemical tankers
• Acquired product tankers for historically low
values
• Developing leading company in tanker
sector
• Market value of NM ownership1: $67.6
million
Navios Maritime Holdings Inc.
(NYSE: NM) • Controls 49-vessel drybulk fleet; 30 owned and 19 long term chartered-in vessels
• Flexible business model; Opportunity from market intelligence
• Stable cash flow from charter-out contracts >12 months and Short-Term Charters, COAs and
FFAs
• FY 2011 EBITDA: $265.4 million
• NM: Share price1: $3.56
Navios Maritime Partners L.P.
(NYSE: NMM)
• Focused on long-term charter business in
the drybulk sector
• MLP with high dividend payout model
• Fleet of 21 dry bulk vessels of 2.3 M DWT
• NM receives incentive distributions through
the wholly owned GP
• FY 2011 EBITDA: $137.8 million
• Market value of NM ownership1: $214.6
million
Navios South American Logistics
• Integrated wet and dry logistics operator in
Hidrovia Region
• Core operations:
- Port Terminal facilities with storage
- Barging (wet and dry)
- Cabotage business
• Expansion into mineral commodities
• FY 2011 EBITDA: $39.0 million
25.2% NM
Ownership
54.0% NM
Economic
Interest
63.8% NM
Ownership $2.10 /
share
$0.66 /
share
1 As of November 19, 2012
5
Cabotage Business
• Refined product transportation
along the Argentinean coast
• Six ocean going product
tankers and two self-propelled
barges
• Strategy to secure cash flows
with long term contracts
• Awarded Brazilian Cabotage
contracts for six new vessels
Barge Business
• 289 barges and pushboats
transporting dry and liquid
cargoes across the river system
– Pushboats
– Dry barges
– Oil barges
– LPG barges
• 1 floating dry dock
36.2% Ownership 63.8% Ownership
Grandall Investments S.A. Navios Maritime Holdings Inc.
NYSE: NM
Navios South American Logistics Inc
(Marshall Islands)
Port Terminal Operations
Storage and Transfer
• Bulk Terminal – Nueva
Palmira – Uruguay (tax free
zone) with 460,000 mt dry
storage capacity
• Fuel Terminal – San Antonio
Port – Paraguay with 45,700
m3 storage capacity
Navios Logistics Ownership Structure
Navios Logistics Highlights
6
Leading Logistics
Provider in South
America
Largest independent dry terminal in Hidrovia
One of the largest independent liquid terminals in Paraguay
One of the largest, most versatile barge river fleets serving a diverse set of industries
Largest Argentinean product cabotage fleet with an average age of 3 years
Multiple Avenues of
Growth
Opportunities to invest in new port infrastructure
Increasing minerals and grain production and fuel demand create need for new convoys
Opportunity to expand in Brazilian cabotage
Favorable Market
Fundamental
Robust growth in exports of grain and mineral commodities
Hidrovia system and coastal cabotage are critical infrastructure for region
Scale and Strong Asset
Base Provide Operating
Efficiency
Economies of scale provide low costs per ton transported
Integrated terminal, barge and cabotage network offers substantial operating leverage
Strong
Counterparties
Diverse group of large, high-quality counterparties
Exposure to ADM, Bunge, Cargill, Dreyfus, Petrobras, Petropar, Vale, Vitol among others
Focus on Contracted
Cash Flow
Strategic positioning with fixed rate contracts and CoA’s with minimum volume guarantees
Long-term relationships with high contract renewal rates
Seasoned Management
Team with Strong Track
Record and Established
Brand
Strategic relationships
Experienced management team
Long operating history in region
Integrated Transportation and Storage Services
7
Port Terminals Barge Business Cabotage Business
Asset Base
Bulk transfer and storage port
terminal in Nueva Palmira,
Uruguay
Liquid port in San Antonio,
Paraguay
223 dry barges
39 tank barges1
22 pushboats
2 small inland oil tankers
3 LPG barges
1 floating dry dock
6 Product tankers
(8,974 – 17,508 dwt)
2 self-propelled barges
Commodities Transported
or Stored
Dry cargo (cereals, soybeans,
iron ore, etc)
Liquid cargo (primarily diesel
fuel and naphtha)
Dry cargo
Liquid cargo
Liquefied Petroleum Gas (LPG)
Refined oil products
Typical Customer Contracts
Long-term storage and
transshipment contracts
Time charters and CoAs (1-5
years)
Spot market contracts
Time charters
(2-3 years average duration)
Spot market contracts
Geographic
Region
Strategic locations along the
Hidrovia river system
Hidrovia river system
Argentinean coastal trade
Opportunity to expand into
Brazilian cabotage market
1 Including three tank barges to be delivered gradually until June 30, 2013
Barge Business Ports Cabotage
# Barges &
Pushboats
Largest Independent Dry Port
in the Hidrovia
One of the Largest
Independent Liquid Ports in
Paraguay
Key Benefits of
Large Scale
• Lower operating costs
• Greater market presence
• Higher quality charterers
• Strong strategic relationships (shipyards, commercial banks, etc.)
DWT
(‘000) Top 5 Players Top 5 Argentinean Coastal Cabotage
Players by Tonnage1
Largest Independent Logistics Provider in Hidrovia
8 1. Includes vessels 5,000 – 29,000 DWT
Sources: Drewry as of January 2012, Companies’ websites
684
289 247
181
118
0
100
200
300
400
500
600
700
800
Ultrapetrol NSAL Fluvialba ADM Interbarge
Presence Throughout Supply Chain
URUGUAY
CHILE
BOLIVIA
ARGENTINA
BRAZIL PARAGUAY
Corumba
Iron Ore
Refineries
Grain /
Crop
Dry Ports
Wet Ports
Refineries
Port: Paraguay Fuel Terminal
Loading / unloading
Storage
2
Exports
Barge Transportation
289 barges and pushboats
– Wet and liquid cargos
1
Cabotage Transportation
6 ocean going tankers
2 self-propelled barges
3
Southern Argentina
Port: Uruguay Bulk Terminal
Storage
Drying & conditioning
facilities
2
9
10
One Barge:
1,500 Ton
52,500 Bushels
453,600 Gallons
One 15 Barge Convoy:
22,500 Ton
787,500 Bushels
6,804,000 Gallons
Jumbo Hopper Car:
112 Ton
4,000 Bushels
33,870 Gallons
100 Car Train Unit:
11,200 Ton
400,000 Bushels
3,870,000 Gallons
Large Semi:
26 Ton
910 Bushels
7,865 Gallons
Equivalent Units
One Barge
= =
13.4 Jumbo Hopper Cars 58 Large Semis (Trucks)
= =
One 15 Barge Convoy 2.0 100 Car-unit Train 870 Large Semis (Trucks)
Barge transport is cost-effective
The Economics of River Transportation
Source: IOWA Department of Transportation
11
Market Overview
• Runs over 4,500 kilometers across the agricultural heartland of South America
– Comparable in length to the Mississippi system
Hidrovia Region Mississippi Region South America
Number of barges: ~ 1,700 Number of barges: ~ 27,000
Significant Capacity for Growth
Hidrovia: Agricultural Heartland of South America
12 Source: Drewry as of January 2012
78.5 91.5 95.7 101.5 104.9
122.6 127.7 112.3
132 136.8 148.7
1.1 1.6 1.8 1.9 2.3
4.2 4.4 4.6 3.5
6.0 7.1
Solid macro
economic
fundamentals
High-growth, stable
environment
Increasing discretionary income
across the region
Room for future growth
supported by demand from
China
Stable and democratic
governments
Tightening sovereign
spreads, lower debt levels
and political stability
Investment grade credits
Commodity boom fueled by
exports of grains, iron ore,
forestry and hydrocarbons
The Parana Hidrovia
provides a 2,800 mile trade
channel to the rest of the
world
Latin America Ranking S&P Rating
Chile A+
Mexico BBB
Brazil BBB
Peru BBB
Colombia BBB-
Uruguay BBB-
Paraguay BB-
Argentina B
Investment grade countries
…and improving credit profiles Decreasing political risk(1)…
Regional Grain & Soybean Exports(2) Hidrovia regional iron ore production
(Million Tons) (Million Tons)
3.6%
2.2%
0.2%
Latin America U.S. EU
Avg. 12E-13E
Robust economic growth… …and decreasing long-term inflation
Source: EIU, SBI, Bloomberg, Food and Agricultural Organization, Drewry as of January 2012, USDA Foreign Agricultural Service (1) Composite of Latin American spreads over 10-year U.S. Treasuries (2) Includes Argentina, Bolivia, Brazil, Paraguay and Uruguay
Stable and
rapidly
improving
political and
economic
environment
Global
commodity
boom is a
driver of Latin
America growth
Attractive Underlying Latin American Market
13
0
5
10
15
20
25
Inflation rate, average consumer prices (Annual percent change)
0
200
400
600
800
1000
1200
Source: Web site of the UNESCO/IHP Regional Office of Latin America and the Caribbean
Water requirement equivalent of
main food products
Global Virtual Water Imbalances Will Continue to be a Driver of Agricultural Trade
This table gives examples of water required per unit of
major food products, including livestock, which
consume the most water per unit. Cereals, oil crops,
and pulses, roots and tubers consume far less water.
Source: FAO, 1997a
Product Unit Equivalent water
in m3 per unit
Fresh beef kg 15
Fresh lamb kg 10
Fresh poultry kg 6
Cereals kg 1.5
Citrus fruits kg 1
Palm oil kg 2
Puls, roots and tubers kg 1
North &
Central America
Africa
Asia
South
America
Europe
15% 8%
26%
6%
11% 13%
8% 13%
36%
60%
5% <1%
Australia
& Oceania
% of Global Water Supply % of Global Population
Fresh Water Availability vs. Population:
Grain Exports = Virtual Water Trade
14
15
Favorable Market Fundamentals of Hidrovia
VENEZUELA
BOLIVIA
ARGENTINA
BRAZIL
FRENCH GUIANA
SURINAMEGUYANA
COLOMBIA
ECUADOR
PERU
PARAGUAY
URUGUAY
CHILE
VENEZUELA
BOLIVIA
ARGENTINA
BRAZIL
FRENCH GUIANA
SURINAMEGUYANA
COLOMBIA
ECUADOR
PERU
PARAGUAY
URUGUAY
CHILE
• Growing exports of grain and mineral
commodities
- Region accounts for ~50% of global
soybean production
- Significant expansion in iron ore production
- Significant exporter to emerging market
economies, such as China
• Reliance on waterborne transportation
- Shortage of highway or rail infrastructure
alternatives
- River system provides access to Atlantic
Ocean and global export markets
- River barges and coastal tankers are the
most cost-efficient method of transportation
Coastal
Cabotage
Trade
Navios
Oil
Products
Terminal
Navios
Dry Port
Terminal
Hidrovia
River
System
16
40%
45%
50%
55%
60%
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
Soybean Production Region % of World
Hidrovia Region Soybean Production
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Iron Ore Corumba Production
Corumba Brazil Iron Ore Production
Hidrovia accounts for ~50% of
world soybean production
Increased Chinese demand driving
Brazilian iron ore production growth
Hidrovia Importance in World Dry Bulk Trade
Mill
ion M
etr
ic T
ons
Note: Crop years for Soybean Production according to USDA definition, P = Preliminary, E = Estimate
Source: Drewry as of January 2012, USDA October 2012, Vale, MMX
Regio
n %
of W
orld
Thousand M
etr
ic T
ons
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Argentina Bolivia Brazil Paraguay Uruguay
17
2000-2011 (thousand barrels per day)
Argentina’s total oil demand was about 678,000 bpd in 2011
Argentina’s total oil refining capacity is about 627,000 bpd
69% of Argentina’s refining capacity is located near the
Hidrovia and in the Plate River Estuary
Paraguay does not produce any crude oil and relies on
imports from larger refineries in Argentina
CAGR
2000-2011
Argentina 2.6%
Bolivia 2.4%
Brazil 1.7%
Paraguay 0.6%
Uruguay 1.6%
Total 1.8%
Hidrovia Region: Stable Growth in Oil Demand
Source: Drewry as of January 2012, US EIA as of September 2012
2,794 2,785 2,615 2,679 2,709 2,806 2,953 3,073 3,166 3,328 Total 3,412 3,154
18
Q3 2012 Earnings Highlights
Navios Logistics Q3 2012 Earnings Highlights
19
(in $ ‘000)
Three months
ended
Sept 30, 2012
Three months
ended
Sept 30, 2011
Y-O-Y
Variance
Nine months
ended
Sept 30, 2012
Nine months
ended
Sept 30, 2011
Y-O-Y
Variance
Navios
Logistics
Revenue 65,005 68,847 (6%) 188,445 167,908 12%
EBITDA 13,156 8,909 48% 37,247 28,950 29%
Net income/(loss) 896 (1,527) N/A 904 983 (8%)
Port
Terminals
Revenue 25,614 31,300 (18%) 75,537 62,483 21%
EBITDA 6,878 4,154 66% 18,591 11,506 62%
Barge
Business
Revenue 24,211 23,170 4% 71,609 64,962 10%
EBITDA 3,975 631 530% 9,527 5,013 90%
Cabotage
Business
Revenue 15,180 14,377 6% 41,299 40,463 2%
EBITDA 2,303 4,124 (44%) 9,129 12,431 (27%)
Navios Logistics Q3 2012 Balance Sheet
20
Selected Balance Sheet Data (in $'000)
Nine Months Ended
September 30, 2012
Year Ended
December 31, 2011
Cash & cash equivalents 59,633 40,529
Accounts Receivable 17,884 31,959
Vessels port terminal and other fixed assets, net 355,586 350,088
Total Assets 633,597 621,234
Senior notes 200,000 200,000
Current portion of long term debt 69 69
Long term debt, net of current portion 544 599
Current portion of capital lease obligations 1,342 31,221
Capital lease obligations, net of current portion 24,106 0
Noncontrolling Interest 577 541
Stockholders Equity (1) 321,588 320,684
Book Capitalization (1) 547,649 552,573
Net Debt / Book Capitalization 30% 35%
(1) Excludes noncontrolling interest
www.navioslogistics.com