Company: CMRE-PC
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001140361-25-005199
Chunk: 215

Company: Costamare Inc.
Filing Date: 2025-02-20
Form: 20-F
Item: Item 11
Chunk 215
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Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

The shipping industry is a capital intensive industry, requiring significant amounts of investment. Much of this investment is provided 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”.

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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,