Company: CMRE-PC
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001140361-25-005199
Chunk: 152

Company: Costamare Inc.
Filing Date: 2025-02-20
Form: 20-F
Item: Item 5
Chunk 152
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 in the form of long-term debt. Our debt usually contains interest rates that fluctuate with the financial markets. Increasing interest rates could adversely impact future earnings.
 
Our interest expense is affected by changes in the general level of interest rates, primarily SOFR based rates. As an indication of the extent of our sensitivity to interest rate changes, an increase of 100 basis points in the reference rates would have decreased our net income and cash flows during the year ended December 31, 2024 by approximately $5.0 million based upon our debt level during 2024.
 
For more information on our interest rate risk see “Item 11. Quantitative and Qualitative Disclosures About Market Risk—A. Quantitative Information About Market Risk—Interest Rate Risk”.
 

Interest Rate and Cross-currency Swaps and interest rate caps
 
We have entered into interest rate swap agreements converting floating interest rate exposure into fixed interest rates in order to economically hedge our exposure to fluctuations in prevailing market interest rates. Furthermore, we have entered into a series of interest rate cap agreements to limit the maximum interest rate on the variable-rate debt of certain of our loans and to limit our exposure to interest rate variability when three-month SOFR exceeds a certain threshold. For more information on our interest rate swap and interest rate cap agreements, refer to Notes 2, 22, 23 and 24 to our consolidated financial statements included elsewhere in this annual report.
 
Furthermore, as of December 31, 2024, we have entered into two cross-currency swap agreements to hedge the foreign exchange exposure with respect to the unsecured bond loan that was fully prepaid in November 2024 which was denominated in Euro. For more information on our two cross-currency swap agreements, refer to Notes 2, 22, 23 and 24 to our consolidated financial statements included elsewhere in this annual report.
 
Foreign Currency Exchange Risk
 
We generate all of our revenue in U.S. dollars, but a substantial portion of our vessel operating expenses, primarily crew wages, are in currencies other than U.S. dollars (mainly in Euro), and any gain or loss we incur as a result of the U.S. dollar fluctuating in value against those currencies is included in vessel operating expenses. As of December 31, 2024, approximately 14% of our outstanding accounts payable were denominated in currencies other than the U.S. dollar (mainly in Euro). We hold cash and cash equivalents mainly in U.S. dollars.
 
As of December