Scorpio Tankers (STNG) 18 Feb 212020 Q4 Earnings call transcript

Company Profile

Participants

Brian Lee	Chief Financial Officer
Emanuele Lauro	Chief Executive Officer
Lars Dencker Nielsen	Commercial Director
Robert Bugbee	President
Cameron Mackey	Chief Operating Officer
Dencker Nielsen	Commercial Director
David Morant	Managing Director
James Doyle	Senior Financial Analyst
Ken Hoexter	Bank of America
Omar Nokta	Clarksons Platou Securities
Amit Mehrotra	Deutsche Bank
Greg Lewis	BTIG
Randy Giveans	Jefferies
Ben Nolan	Stifel
Jon Chappell	Evercore
Liam Burke	B. Riley

Call transcript

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Operator

Hello, and welcome to the Scorpio Tankers, Inc. Fourth Quarter 2020 Conference Call. I'd now like to turn the call over to Brian Lee, Chief Financial Officer. Please go ahead, sir.

Brian Lee

Thank you and thank everyone for joining us today. Tankers' earnings Scorpio call. the to fourth conference quarter Welcome

Commercial Chief Emanuele contain Robert involve today, Operating available On today, Managing we on Nielsen, earnings Analyst. the are fourth based release, Senior and our this James call February XXXX, Officer; results materially David Executive Doyle, on Director; Dencker XX, issued Chief the is call Earlier may Mackey, our that statements. which Lauro, website. forth from is The Officer; information forward-looking and Financial Morant, Actual uncertainties. Cameron Bugbee, Lars quarter those our may Director; press as risks in discussed of statements on differ information President; such set

being you in today SEC statement participants should review Internet this scorpiotankers.com There Relations An For that Presentations. scorpiotankers.com on approximately on under our days. discussion being Scorpio as for available a Investor the call at will the the audio available we sec.gov. issued press and uncertainties, disclosure webcast release as that well slides which Relations is are the Tankers' Investor made the the Call be of these website and live of the playback. page archive XX for on of and recorded filings, the and conference are advised at earnings forward-looking are is broadcast of risks page, available Reports

can modeling you financial any contact later you If specific offline. questions, and me have discuss

Emanuele Now I'd now like Lauro. to introduce

Emanuele Lauro

that in demand, we the is injections day has infections. And rollout global be COVID of game proving of per It are our temporarily us this of estimated is winning potentially thirds in which against On as is for changer aviation. with correct. would Welcome Brian. X reduced today. barrels now that we potentially million significant. XXXX. businesses first rebound everybody The rapid call, speak, two Thank last and you, to you vaccinations a is quarter Thank our of our being said

tourism, we in are correctly As discounting of already significant sectors of and Asia, a large for example, market, levels Meanwhile, like travel our normal demand, of to parts the across are already we view. in look back many demand. so in the economy rebound

to do we here. from rates expect move upwards So,

for While not we the and we business, energy, across longer different have short-term experienced renewable science, rapid a of much opportunity we developed our refineries three the The opening cargo the capacity overlooked technology, decisive company, in last medical sight macroeconomic impacts global one of half seen major Zour acceleration XX virus Al we Tankers our have must the on exists like the of Jizan months our listed industry. lose by In term of of MRs. in Scorpio a at Middle the the segments, way others. but closure first or have refining like a weeks in world. have East this, ago the Jizan and of Alongside experienced evolution

So will these on felt. as be long the positive impacts after structural demand ton crisis receded mile

in which from fleet started pre-existed it well benign, As in the pandemic. The picture is can only we structural into present, the and is benign, supply the At tankers demand modern the but product changes pandemic has future. accelerate in the very to to which modern building still such, MRs is underwater with not owners to starting remain benefit clean of power to and now undersupplied ordering the it has in pricing deepen prolong served like STNG. returning only to process, another the The encouraging low, factor. And continues is this shrink. The process, crisis vessels markets. new incumbent

their have teams our who around and key I in most circumstances and words and our the spend seafarers about to from a workers, friends, employer. personal demanding like the supplied. significant thank extraordinary away company, of responsible would sacrifices record I is conclude, keep proud proud a just their the is its world. I world Scorpio as employer, the economy to Before think these made from responsible a away families,

at unwavering employ can about on support XX,XXX the continue rely sea periods. land and more on We crew since these our the to through Our X,XXX have we and pandemic. start movements of teams than seafarers

in Finally, hydrocarbons I But way. global and an are hydrocarbons. the clean in believe in that the We up and or will role to future, modern with this a play produce in future, ECO about we tanker in transition. the this sum following different stay. likely to a consume here community, a Hydrocarbons will way thoughts as better has pivotal evolving

modern remarks volumes worlds. to As products with I such, once exporting window of efficient has our this, and mine the ended my and future up given all to refiners step like I've Bugbee. of to refined major With to turn the it call tankers corners Robert huge some, a This the for would tragic crisis future. product the many has been is painful in on for us

Robert Bugbee

investor. you Look, Thank I the time the is shareholder super for this STNG much, absolutely past and bottom exciting We're potential STNG terms in think the Emanuele. very of rates.

containers, year, even NAV last to and net We'd to earned ago. sort value. that will from only asset the values, capacity, the back the away. great -- the despite shipping we charter interest opportunity to Despite still as to demand to that that to you going over its in would immediately strong higher corresponding inventories expect stock debt partial at trading as from significant run the any the been the XX from move to the drawn in New really upwards high being discount that that have pricing the areas move many can the sort is to It's a down, XX, Asia in next up curve bottom and is Year. out start to see And move Asia rates that can is trading started increase are that from expect Time straight forward input still inquiry through sense It's start in was the upwards our upwards an they as discount very dry just a tonnage again little weeks modern earnings we where cash sharply. strengthening of vessels, fixtures, trading, like LNG there's into comes and year. to. going well market Company quite we're means so is be significant the at and the moving, is going rates seem surplus further cargo Yard get of of our Now, Lunar Company that months all especially the high couple is paid across being movements too.

a the high, psychology addition creative People of the and to out, In come people's and interest. pointed people last sold four going changes expected the in of these demand as are expected -- Emanuele we the Last rapidly game will stock say believing can are weeks And think that, it forward year. OpEx. a market to to last have the and off expecting to greater vaccinations a everyone changer that of move shown investors rates and out does safe game expect mood. lead to lot Today because the opposite vaccines were year when fall.

better that's result anticipate with about get is open the COVID. really have in fact today. starting up And questions. going much. a lot short to I’d very a to as to to we the you of that, like talk it Thank interest still that denying, the staying world we're we and denying anybody lot significant improvement and that have to is So, short of a

Operator

first Instruction] [Operator the of Your Bank question line from Ken America. comes Hoexter from of

is Your line open.

Ken Hoexter

a you talk would the rates you book are just showed the -- bit just about trading patterns like declined? prices you sequentially others West with crisis? other expect improving the where storms and Is differential? MR kind that East dates, Can having you of a on you Or pattern Can trading are? more effect that to also decline that your gas about the specifically where given nat talk and do

Robert Bugbee

that will one. answer Lars Sure.

Lars Dencker Nielsen

the it I that be see doesn't capacity Robert's days going delays to the of have what's to I to on is that these base and take is the going on do of Obviously, kinds thanks spikes mean. pretty to market. much to point, back uncertainty mean, leads The rebound I MRs to can Sure, the and honest, referring and Atlantic you Ken. good the example of what the we in free live dislocations guess seen right that now.

is not the product I that, in MRs the market, West has it again really. in reasons just per Handys, to really market This back that So it limited, a moved has which is very to Similarly, say. the the it increase that this or just markets at vortex, capacity do as the Monday. seated to cheesy is we get it's on days, XXX obviously volatility up market alone over so interesting I really from U.S. the immediate the in And remarkable. East polar the miles or jump XXX on to capacity note point the day And jump guess, XX, of balance And very, actually well that much capacity that is issues with And with subsidize. was to it's the the have very the completely the is the week a substantial overhang and any vessels arising that, West which as have day what base was the to shows Atlantic course trading week and about testament corresponds and think pretty is the X,XXX margin, we're of which and require to to of XXX.X and equates layoff, $XX,XXX increased from we probably would this well, market that moved in saw in to the I scale is of as need is rapidly. per polar here nothing the XXs men that do East the around vortex, by to they other hampered place. move,

in normally time sentiment. uptrend quickly. shows come And I think the time I very reality balanced followed markets So by and it again, think is that fairly

Ken Hoexter

of us? me per still always that from positioned guess of follow-up capacity? and this depending into that that Is what maybe Robert, And on that done of while talked about market the to with storage in this -- of the Are the a bleed barrels out does something price rate where or now that, get guess, reversal let Is how finally see I will that guess, on quickly I kind start the to water? pressure Saudi. length within really quickly just you've you're million seeing through. does driver tightening cut on we the day that, Amazing, the well the hauls? impact absorption lengthening going sit we I

Robert Bugbee

storage no water think that's analysts barrels to storage the this, product XXX,XXX products still great next almost left there's all, say but would upwards, some into for you're But think XXX,XXX for would their I can would start all X.X at a the the of as first or reverse million And to Saudi on of on product we're the the exports market, thing months think totals And oil say just then and to there's And wisdom the Saudis I water going year, product So, in increase. that particularly million the drawn I it's XX put going as end market the over almost anyway, pick positions a VLCC move of that's down. market. We're so OPEC up will or month in stripped in talk the VLCCs. and way, fantastic conventional Lars for the their their to us where about going question Saudis exports. either to crude between move to going the the before soon X market the we day up be that imagine. and psychological and

to LRX here So the of up, the and coming two new gives our itself whether with to that their start confirmation, East that more the weeks, and market three the going of with end up. is crank market belief refineries weeks it's Lunar along just Year New

Ken Hoexter

Do and can, expense One come see down thought me costs lasting stuff Robert, one all something Is all? or Maybe guess I see 'XX? this one elevated you quick remain if the doing? may last I I particularly that through COVID to the presume you're at XXXX, Brian be of that on starting just that that's for operating you for side? because

Robert Bugbee

because COVID and are Ken, other it's of few right, with things associated that the changes that. crew

places things in and we the easier are that's see vaccines, and going the for So at here, first we'll trade least quarter better still hopefully, to with crew more going getting are mentioned as that forward. changes be

Operator

comes Clarksons Nokta from of line question from the Securities. Platou Omar next The

Your line is open.

Omar Nokta

other of some for think view the context? pretty multi-year your we've positive you from similar remarks of each sectors, the in those of that, obviously of here as few There's kind seen share and about driver about mind you can over tanker as that here containers seen out then here, past the feel of real as outlook, you their a presented kind out do in and you see as Emanuele, strengthening highs quarters? came opening And Robert, COVID few how with you how market that next recovery playing out downturn. coming the in guys gas, something for shipping in in buybacks gate months a induced a

Robert Bugbee

probably I of if going petroleum $XX whatever, are rates they're be what if higher, mean we what's in okay, be clean no, year, or said, it going XX we the they'll were They're I this stronger. years demand have was yes. as -- think there's was trades the to the where be because where stronger months question the we of ago is turn going XX think to January XXXX, because be, number that changed going a to to leaving Well, same we first or old. rates

can very will but I'm some in in example. indicated, about on accelerated succession, its and We changes. a position. having separate refinery we've supply terms the Emanuele still are book, in question, have in positives that we very And in been changes a constricted what's refinery seen happening have just sure, ordering James real of constricted as order talk Australia for quick

of this when prices on, values, scarcity now, shift going their to big through moving this to consolidated and up. the steel period price product the modern it yards of upwards, are of moving effect miles, new There already So odds on inflation XX comes a tankers. positions there's is right

market, every reason that this in $XX, share that, there's it months, actually same, to reason paid you XX fact trailing the the recognize that that stock the back there's the where in should why than you'd given time. no stronger XX if would a the So look be be is at the count way Company until in higher months

$XXX things see doing. to that the what very the been liquidity. We're and have are that The of We the second balance with we're liquidity. our were still million question, more showing consistent on million you of no, we've today can we or of continuing less we're the maintain in sheet that cash announced excess financings that works $XXX

able in play more the above higher. through so this but for as stock that well see and is two to getting go more things months price three we indicating waiting last and this the certainly, humble we're vaccinations, position. we to And to going out. we're NAV present confident But believe we've remained We're

the $XX,XXX there, start day see really but moment and move thing a in that to let's move do. that's say be breakeven and the is prudent cash shift average, to above to room that So all which say, like going the we'd let's to there very first rates on is the

Omar Nokta

to certain you you're Thanks close you seeing Are any preparations mentioned coming? shift Robert. there your point, maybe curve, types say kind see of to there's market from the barrels kind to Brent little terms are seeing you seeing to and we are seeing or wanted pressure maybe on including And whether thinking up jet carrying in check on from, New in you’re and to cargoes shift, it's pushing and anything with? refineries Year to come changes cargoes production, an of fuel their That business that at sense. oil their that mounting part of potential about when for gasoline, but makes to it's early, indicates the of just what oil to Lunar the is in it's, obviously ramp with look you Are do holidays from a anything the that that vantage the more OPEC. XX you recovery you there, now price expecting improvement

Robert Bugbee

Lars would to that? answer like you

Lars Dencker Nielsen

Exxon, answer in the people that's with we their obviously, is mile Yes. point the But really a progress, announced the about the ‘XX that and what's which and year. that because stuff, of and done can terms see consider one see how we're down moves was developing chest. to very to you were are are keep day the in Omar, were how to shut into these in seeing the that, really, moving first we relative close their last what and Hi January January going to last on the new Quinato development to done moment. numbers, and And the at the we XX from you XX year. that what difficult other be one do cards And first, MRs was question to look seeing January things were a in January in in what at in Australia was and cycle both Australia, point refineries ton

cargo up we much Jizan, doing been year, and think happening? as Emanuele Jizan, that talking it's same opening mentioned we’re Well, to that ramping can very moved seen At that are already of I west that haven't they're well. things see the thing. people reasons. And and had the the the we seeing been happening saying first moment So certainly obvious they're for quickly in we've about very moving remarks out do everything last that going they're we've about what we distillate

flying big unbelievable up where the of lot NAFTA East Asia, moving and obviously no which to of storage you what small markets things in say barrel of jet it. is for doesn't it's that of direction. did It's are early see And cargo. but We seeing start that and we're East that held a Obviously, the first seeing the ships. unlimited still too certainly this, stop life, light sparks other have to you means. do to parts it's jet have going and places fuel turn, moving prior. this in been think other have the and moment going weeks there this to particularly West then be We're what with course the six to what waiting what to going course the at you're around the with from seeing we're is the jet your when in about start demand eight So for that right of storage, has going again,

still we some pretty fixing in say We are change, mix their out So, particularly out see like stuff to that. confident we're the windows such changes. markets see reaching to But seeing think we're that can the is that starting will West start bit. and people that on the I as further in cargo

Robert Bugbee

already we're, of as And mean, what's look call UK so whether just you steady restaurant I the three as Lars living, think the it's open the this able tide they think to and to out. about is going to one do are. But doing to happening turn tide crazy. at certain want of other out that, we're are been last and lengthening going customer's the sports and This I to driving, modern that's pretty stopped tonnage I in says, it, or taking the states of going like own started rates talk see, two their gauging the, where what United up, better Europe's falling been to really in it. where is as on the is to the is is or or it's, and on ways changing, you it's, the tides the position team in kids simply, just again, to we're the things the where going being books our starting play COVID sure States in start weeks

we're, I we close. say are pretty wouldn't that So,

Lars Dencker Nielsen

to we sentiments. that lot just that real kind it this be see of And 'XX, the has charters thing it on I curve. And and in time charter and they the looked of that date Paul And to is of activity about, the to talked that of indicators always note vessels. see most of And happening has inflection add before of a to that happening the one and most that ECO vessels. is can the tend what's make obviously typically, leading when terms obviously point year been happens that in the right been of of they sure rationale on the when on that for of value now they Robert months, do the interesting take side MR we traders, time at days that's

miles time done the When things over we last of them a think, a the on I transfer large ECO, of also those year. of And handful in scrubbers. follow the on we count actually our this majority own. are and these XX see and are

roughly using So, a of we customers quarter, trade newer the carbon these user, then out be numbers the changing of dynamic is that they're every certainly with these tells the the we tend a kind we that fuel older efficient. towards to ECO of look fleet. quite and really or are I then more clearly a business the you that think be the ships that same, can on here, traders as portfolio, every vessels pivoting Because at suddenly have, a overall to more it's which see follow with one they this they will end that important units that

Omar Nokta

in shifting that months Thanks, as your you two whenever Lars. Robert the results. call, it's early come probably, sets about tell two but pretty definitely and a to up you with I Obviously, out bit or it's interesting think a guys well. months mentioned, cargoes, time color earnings next Appreciate as

and I'll it turn over. for So, thanks car, the

Operator

Thank you.

comes Mehrotra Deutsche Bank. from of Amit the line next question Your from

is line open. Your

Amit Mehrotra

little terms there is we there I for stretching Brian, saw guys what of tables to out more want a Thanks, operator. Or that? terms done bit to in of on debt amortization prospectively, do all the you in are a bit? the moved come around

Brian Lee

We some have facilities draw few then things a we're discussions we few we on, in mentioned, on to that we're have and on more other working as ones. down a

So, it a point. life where see very few things it we is your around. it. more on are top we for makes But difficult and that Thanks coming down. to we'll at Unfortunately, of keep moving have guys then

Amit Mehrotra

I bet just it's right. going down,

So but that's good. to tough a fair next My it's question question. be is a question, think I going completely

this So, Robert, on can loss and I just to warn exclude of want don't things you time exclude called the $XX why We're I guys GAAP in bottom would annually a know Tankers the reported guess much I lost is stock money the ahead you XX like into that of Brian Emanuele, those, have and you guys losses, lost you We time. Scorpio quarter restricted million in quarter. a XX% loss. awards. impairment but now years line you the basis. venture

what stocks XX%, want So question you going And that's really to create in you rebuild public? the it you are to to party question change down actually SSH? to to is, some from about of in what is, the your allow the some guys with since to shareholders? the the doing strategy the value this is the I'm value took transfer talking And transactions goodwill second, related perspective

Robert Bugbee

Thank you.

major related this change OpEx, investors, two as that been very, costs relationships. et along ago, cetera. years direct things We process, gone I fees basic, They think three had through up, is we've various gone fact We've years with did there's up. obviously went or a dropped our those question haven't a the to price in and adjusted the been we've we've way. actual no have we've that conjunction adjustment for the gone despite lead

be this out, terms is, of that think by real to to the is the fundamentals. now, play created, is play right going to dynamics in going out going I value the there's

Amit Mehrotra

they the haven't shareholders give because out, right, fees, gone holiday but they you technical down? management and on haven't commercial a gone Can you're public

Robert Bugbee

when at any we really, that's fees. previously, the At all have think didn't high. We drawback that gave we holiday low a been the the on do in were When the moment, consistently rates Company. commercial don't necessary really rates

actual gone cetera. being et I cetera, lot, have gone have salaries up, hasn't but reduced the that a think quite cetera, up, costs because have been that margins et gone simply et up,

improved. well many the a is it, So about. quality against the well way against I on difference in do talking you make wouldn't so very any very the what material see mean, competitors. benchmarks ways can we're we and It

Brian Lee

are Robert, two may. things, there I And if

I think on that it fair a we to we need it question and contextualize question questions. your direct is like because

that the has for the past I think beaten decade. been out space

that others, to right top. think performances compared we look actually our you if on at I are

ago, If was you look the fee minutes Robert creating noise. and and to drop X% SMPC, it decided a a mentioned other it which many which then confusion as mentioned, we with at the companies which charge, went public issue you've that staff SMPC, apart was few or then we has from dropped, to charge together because that our underwriters we when decided

inclusive are look technical our on at numbers. just net our fees, inclusive of or we are that numbers commercial OpEx OpEx, the side and However mentioned, you've issue at look if peers, on the that you fees, of commercial our

really right look So numbers, bottom, we market criticism, we there with fees, to charge right quality is at OpEx. post on, nothing standpoint are at and of with or price from outperform results, at the the we commercial a are the top

that there do the contextualize which a true or known is as performance, the very I cited as on criticism. some numbers, are I general we important to this, is said, welcome, you it's So questions argument said, direct it on

to one, lot an was space bringing. guys of the paid and investors changed remain you analyst have However, because analyst and attention specifically the a a of has where results depressed an the the industry on struggled tanker industry quite shipping the industry in been from perspective has that relevant general in not difficult

right. you're yes, So,

Amit Mehrotra

point I be it's don't Really, because labeled want a the public call. to

So, on. anything don't The like, But question. had I I'll has the I move question think is. with that to do

when have awards basically, the equity prices XXXX, management collapsing awards stock You also XX%. which over team, of million is share to restricted since still equity XXX public the

kind how that? do you So explain of

Lars Dencker Nielsen

isn't the compensation I think lot The cut Company price. stock to management yes, tied that is know, the a to getting. the

we at a The things And other is we're tied looking salaries, shareholders, doesn't to is large they, bonuses, to cash overall suffer et that way a management, better as buy price, probably when are I opposed or also tied it's of the look, to perform. think cash it amount of a position compensation the the stock and stock we cetera.

Amit Mehrotra

know are you. tough questions. thank these I Okay,

Brian Lee

recent But you seen been fine. And have through this division great one, I stocks. stock for backing return. fine. that, buy many the totally insiders to especially, investing we much recently, we're big I'm think at management's really is going period derivatives is moment We're a buyers, or the the be the of shareholders mean, it into truck you in what other part is haven't up as especially

Lars Dencker Nielsen

And to so period companies we but then great a ask because at enjoy months as are, the came happy, the to but room ahead from this many prosperous didn't there you shy well of we happy pandemic as not many, XX you that's but and question did, discuss other for make you actually I a as period that happy whenever more to importantly you're thought say, months ago, very we going made many people, and we us, for which you then XX not want. was because were were, question ago, where

Operator

Greg from Lewis from BTIG. comes line question the next of Your

open. line Your is

Greg Lewis

everybody. Thank Good you afternoon, and good morning.

entities impact spreads couple you you'd head to over As I business are thank the other when for to widening some out really, months? had you that there Is you that of the much thinking related? I yours kind And I at scrubbers its of I rear highlight question how traders looking way of starting again? forward performance performance the year on advantage dollars, go that of into quarter, about parcel vessels scrubber guess for graduate about a is scrubbers actually kind the around the which of spread. presentation, and And the scrubbers, and my as any to take in the lot charter be is, guidance, of slides. through ago, those is -- start we look next of a should of thought realized I look how at the

Emanuele Lauro

spread $XXX. that see and spread, going so do see recently, how under continuing the not don't don't upwards our much back that it has you question, very necessarily it's first going benefit But, do and yes, will much much to we rewind really up in above our price to results bit, been we only the our fuels it of we $XXX. $XXX. a But had to is I open of know, started to in far guidance, as moved a for back see we and has

to become to So it'll year. meaningful, as more that? James continue this through like I you'd add if know we

James Doyle

would I would, I that No, completely with agree Robert.

spread. presentation, breakdown you have in our gives the at which slide We a a $XXX

for outside And So to vessels. in to you you oil generation of would normalized divide that continue a we're will East and just high get but fuel there's use the XXX the spread because commodity limited think savings widen cycle. Middle scrubber by we fitted sulfur the more power know in

Greg Lewis

for there looking increased and interest been charters charters capture to for And the what an pipe scrubber then spread? really about is

Robert Bugbee

there's that two, spread better the as have think of fuel I is is looking add because in especially scrubbers like for total either And terms Well, of environmental can reasons. on then top up. opening consumption, perform they'd anything that a chapter to of

Greg Lewis

from whether parties commercial I'm a involved lot it's environment? of to you houses? four European one, banks across have Do shipping we lease additional providing in demand out Okay. bit. traditional what be shift books And going come over we to and realizing, as Do recovery lending, just then any of we Or continuing houses? gears terms curious, capital banks, move pull expectation mode. a for of understand Asia sizing rising sense right trying your we then little in Really sense seeing of years? back? be any two, to three, of prices is asset are the more Brian, appetite of and last are Clearly, And kind oil been there it's of there's some now of we shifting an that a than obviously, this, have leasing seems as into stable still I'm to different

Brian Lee

you our it'd went think we And X equal. roughly just together coming in lease play. if can I much and you're other more into near last time, actually summary billion. financing sale billion about Financial are be about a leaseback see back think James I Asian put there year, just facilities under looked our the on be that And any at you seeing Well, the a houses are and at it in would there's if credit XX, about nowhere Slide

time, as So, it. doing And has only not that ones over changed. you the we're saw

people other that. seeing You're doing

borrow we're So, for to market different from us up a I competitive very to. seeing think open

Greg Lewis

you houses grow the sense kind And appetite of that leasing is the to as get continuing normalized? it from the

Brian Lee

them are some as out well. of least some opening there inquiry more There's At people. are, getting up. think from I we're No, other

Operator

question Randy from of from We the have next coming line Giveans a Jefferies.

open. is Your line

Randy Giveans

then And ask values, outlook on as well market weakness, Houston. on And impacted is NAV. half by asset to then with as maybe optimistic Good. that about this liquid trading environment? just discount struggling of and are you a relatively some outages side, power has And mentioned necessarily the for in significant the is But lastly, year. STNG been at tough wanted to a that other how current how the then still operating market back

sense So, a just for get trying to updated NAV better that estimate?

Emanuele Lauro

what think going can I guidance to on clearly give is give that question we any last not NAV Our pretty is. our we're

first ever first NAV of that because last will was think benefit question, months, will -- cash the one have adopt weak The point? first strategy sell we what shareholders. last of keep we is though year. very few last very certain to would for no had So, to, because our of is, would related even self the a primarily fantastic stock bought course, terms question linked been in Then, back start be especially year the of really we in buy during, then rates that think benefit our our is to that for distress, the hasn't the flow many transactions, been we the year if a to the is I part our to we

most few. been modern the stronger they've the So, tonnage been owners. of have very owners of And

whatever been values were, NAV, were, last transactions. or the very new they've you few therefore weak prices very, market really so is of So ways sellers, we're discounting low, year had values kind new it was many willing who very artificially by, building, determined that and building as few prices, were OpEx. In

rise, people where lots there who Again, let tankers. potential those you buyers that don't their situation product know modern we an are or go almost are of Now of have rise, certainly to as market of the a tenants owners want and market tonnage likely and premium, the a know water that to move this charter they will time because because move prices activity tonnage they seeing, today's modern be in fast. is that they're

for much And be buildings. tonnage to, these so, the to in better than people water it buy it's will all the new to

the So as being little little transacted is being a moment.

got market new and got little very going building to very, charter activity but the actual upward, data the improve. increasing, you've that's that is there's have -- the trend and you've So you know points, of trend and a because upwards expectations you

Randy Giveans

Sure.

raised What XXXX. and kind for you is the and cash additional notes the Okay. via dividends. are uses this in refinancing your a X% are And liquidity of the priority all how maintaining terms then plans And have year? due of to also sources the raising of then of in big

Emanuele Lauro

as to improve are we of dividend, today that to into saying cash While the flow its expect the is market. come the indicating we it's Board keeping markets

to think perhaps was things It been the The moment in changing. been have ensure were Board that expect sources and would the to disappointing. and on now we uses vaccinations untoward So nothing the at December, to we I maintain dividend. right have happens, November,

discussion back pipeline like now, leverage, fantastic We we have operating would would list. back the cross Now But the not would ordering range, a mean, accelerate, with getting to optimistic, we cash as shipyards the people's we no we until more have, be all. of day on can that, that interest would first further. keep to is we after bottom and fleet, be a the sheet, into of stock. And assets little a say buying other earlier, that ship buying we expect until would completely zero, buying at $XX,XXX we we're bit at right priority that starting accelerate liquidity a I maybe to even said free vaccinations and we're fantastic in idea the the can we go would, I do earlier. we in liquid, keep have balance

Operator

of from Stifel. Ben line is question from the Next Nolan

Your open. line is

Ben Nolan

out there's a to utilization depressed artificially Is was sort are that is as some sort stop back things the wanted being the yet? we're to think the something it impact Yes, you function. universal, seeing or to of of sort up remarks, to issues. they I maybe I thanks. guys, Hey guys or one of don't a and optimum that's pick way crews. from talk we've you one other about heard And questions of like crew were prepared circle an of curious, that of that to few places but now, doing sort efficient from things your if need that if just going that that on, their Manila numbers of owners in know new I sort maybe of an by not

Robert Bugbee

Cameron?

Cameron Mackey

as faced you but you're of terms the of declines, opposite. see thank utilization is is the going or decreasing question. to short-term for the TCE, quarters. impact might rerouting event last then an for of normalize, also start there vessels Yes, corresponding some you decreasing see expense. it, things as you The that And that sort travel to in could two the over a we really And that see

for last the just visit or we've for not that to six are slowly technicians, maintain back superintendents again, normal, vessel. to needs or but to been it still a the that feat through travel or to things something manage it's else crew, logistical months the anybody eight was So for our quite that returning

as should Emanuele opening things again, three, four see so say, months, we the said his next remarks, start And to normalize in

Ben Nolan

Cameron, that there what that to done or you roughly? math maybe sort any any have any TC of is impact is way on

Cameron Mackey

offline conversation the take of but it to about the this a Thankfully, numbers hand, can talk law fair bit. some at certainly helps have examples. us don't we of We large

$XXX them taking you're a day, the sure not at So, fleet. a would I'm really, maybe few spacing material, these and been across impact terribly about have one the time, talking out

Ben Nolan

then I structure envision And little that anticipate in there? capital convert appreciate maybe a do before you numbers looking that that bit of a a you than more are to And it's the simply now maybe of in There would want ultimately, is guys we're being on And have But that secondly, to long-term? you capital is type you for a little some but something about smaller comes. year how for? the you thinking what Brian, closing early, back. just bought refinance

Brian Lee

It's very possible.

few point. a different options. to up, this goes And at on, with everything We time but you what it's looking as do looking are coming say, that, we're tell it's as have We our months, we'll I at we're at it's radar. going think still you on XX

Operator

Evercore. from Chappell Jon of line the have We

is line open. Your

Jon Chappell

my from maybe one, a Just long question little bit winded side.

similar X very about to growth our So couple that. view Emanuele times day a million X house talked demand of which is million to the this year, a barrels

extreme barrels going estimates of off the oil is today of understand bouncing came optimism oil higher bottom an are looked therefore, against for positive, to barrel pace market that's million the million with 'XX up out X.X X.X it is to we're the move be of from kind trying and today. analysts recovery. and has I'm is year understanding at period, magnitude demand So bullish What a about demand where super 'XX rate XXXX. little in change over We or two the but decline that of the to

over a Yet we're So be grown or has will than that by X% the number XXXX X% period, lower LRX that's couple MRs a XXXX. percent. looking demand fleet the at

to that kind one? just have of simple that that recovery, meaningful So, ton only demand, supply you pure incredibly optimistic just very trying to that and we scrapping understand, happening a is an not miles not will with sustainable gets else view but with what

Robert Bugbee

Yes, great question.

the remember is have tankers to firstly, we effective what the, supply. So that product

small to can of products, against those offset petroleum over needs aims, expect a premium years, to games which fleet parameters. significant through petroleum details once the the the clean they three in and a will very go we that the fleet order in use present second next decline, XXX be, products well a So, over two, of book what's trading leave miles air clean be

replaced product million barrels of going happened a of then So, flat being huge a barrels import months, by million import those going X is what's the as of that be in mix potentially as forward, improve itself, big this year, changes, going three out this even of million or If refineries an petroleum go, million and basis, are X Australia last the take to product, terminals. seeing side effectively just staying mile this barrels, refineries, effective ton either at declining we're we in forwards supply is year, terms in the or in exports. or in X changes changes, look by terms end just of

So, change. huge a that's

a is change product on actual huge the position. that Just

ton, you're, demand. So oil total product is at oil looking crude looking and analyst looking barrel at we're you're demand, mild your

would James, provide that a oil crude you products going the to going details a far be it by increase is So of for to we to, shifted in rate have that the going going at to be it's of higher then recovery. where how is to being is And ratio sea product us, underneath carried used than some please? and this, in it's to growth, much theme that this world? on like

James Doyle

Hi, John.

X, we So tracked barrels when X was million and have the basically, from X.X we ranged closures, over to capacity think refining industry about delve estimates today supplied. Robert's yes, the pre-COVID, to just but on points,

to So, refining see further space. of consolidation the we're going

imports had ago, in me closure and country very need Mexico were Asia, United look a simple to diesel refinery obviously we refined or closures highlighting these the replace that's going we quite loss to the throughout its only need more year place the at a are refinery closures to one a Wyoming and something production. in small material closing the deficit, about Southeast ask a to started thinking most will cases Now, demand refineries, remaining going that are replace right? that's that's Australian you're because map while However, Philippines start already they you not where the of is not States, the already barrels. have parts areas But we expected. of shows to of I New impact. If Obviously, half to in those have the certain you time at close a if demand, product it's that than Europe, a if

building On side so early XXXXs. it, MR other of really tankers, people didn't the start product the

about two, if has that in XX delivered the started If XXXX, the XXXX, consider were XX deliver to space, a left all XX you XX to that are the to back really XX nothing to space. year each you period XX ships talking really, year to for the then go you're ships ever MR year. now And One, that getting range.

you we considerable. So if it's And to little some about customer regulations I'm to a charter the it of tell next and he perhaps Lars XX a market, time that turning are a these that because forward. and you on this emission order take bit years, going XXX compare preference are MRs to XXX, and over the coming actually can four more day pass

Lars Dencker Nielsen

emission to next costs carbon ECO the I putting to operational got as basically on kind emissions certainly of looking your little age, efficiency, fleet. the on place if with And the to was look important shipping game And around bit of customers going where right we think charter how moving a the it's time that that And be reduce XX% know before doing changes standard And mean, this. efficiency couple carbon of years what anticipation of they're and the reducing grasp the footprint, on to fixed the the really pivot we're today look by now, vehicle we XXXX, a the seeing really Thanks, that's you're up a IMO we MRs think of energy January we've towards I over been to the goals I board a has of things couple across The footprint, there’s of issue. are is have what from the the of second mean got that changer talked today, about the B. thing EEXI. they James. about by a you A at lot we're to want our carbon and this voyage and year, then you that the product try for existing called the will spot from cargo measuring seeing every in Xst utilizing. this vessel carbon on the

the when what that So at all, if the footprint they Well, about, because less first think emit then look of vintage. oil you guzzlers carbon lot you carbon want down mean, emission a more to your gas modern as does lower you our then transporter? ship well, non-eco

But to couple where last I to competitive as here start vessel would If reducing of voyage the carbon vessel look way footprint of So put have majors carbon extent efficient else the as than footprint the the the then are quality what changes to their carbon the ECO be of than question. stop a the it you think larger carbon for lot we're a emissions, that will vessel lot have way you now of here a the and been that threshold will years. focused over was of an a be well-placed. which XX in the reducing with reduce or of of speed. coming in true at speed going as at of much advantage a going most only of really on you oil have more people ECO itself, reduction see introducing seeing On course choosing well was But years, at really again. things market vessel a to least on at seeing anything introduction today, supreme know, non-ECO the set point be which a effectively, there the footprint, tiering that Scorpio age we to we the kind fore people

So here the supremely is is, period. I over backdrop believe this important, next

Operator

Riley. comes Your from from of the Liam next line Burke B. question

Your line open. is

Liam Burke

How lot the re-openings with take talked We've China We've a closing the in does disintermediation this you. to in thank the XXXX. long Mideast. Yes, about roll had closures and the then out? refinery process in

ton miles normalize. XXXX in before more the expect begin We to

Robert Bugbee

normal. back. will that new normalize, won't won't be It be a be a To That normal.

Liam Burke

Yes, that's new right, normal.

Robert Bugbee

long what recently a one he's of Australia refinery now, Australia, So, fixed that added another They already to that that already for we've down. clean I fixed. and it's very been and as from area saying they've that happening as a as believe is to closer the change saying, substitution January vessel already them Exxon closing

from sort then take loss as up before make So around online, instantaneously of normalized they refined to that start, step in months, coming and they a that, it's refining pretty welcome refinery. product for immediately. up now the levels incremental the open move stopped refineries then crude zero for The up have just of they up they crude of sort inventories the make importing refinery that period that of products to kind they they over actual have to refining was well pretty as up the a world, especially they that, just open up when

Liam Burke

the lease, death touched we've everything your else. on your And financing, convert, lease on and front,

makes straight do to here? and sense is at at there that? back the CapEx, rates, look part a As just and stack any you're Or that flows, of looking cost more lower see go you cash or rising accelerating

Brian Lee

at Brian. margins. want better the deal look on these rates, facilities cost inherited Thanks we better those debt We navigate to some the Liam. of at we're of some that It's of where highest just which refinancing

that's interest will stock So to as pay along our that. just which priority that the the as down one right is remains and as looking to longer give at way, number in now, long principal, on term, not would number but ability our Robert the costs one that, -- us said reducing back reasonable, we because more keep is paying then price

Operator

from question is next line of Your [indiscernible]. the

open. is line Your

Unidentified Analyst

first and He retaining one on subscribers financing? of challenging starts and if Company high, example, who wants is to are ex- the thinks consumption, better little question the a me the wants For flexibility rates know fuel in banker, or you of interesting any of bit a higher of Are a global the opportunistically facilities. facilities? all, financing seeing for liquidity features pathway of to back quite from clear an penalties the in you represent just First call the thank apart on and our uses to costs leverage as limitations [indiscernible] time. other and I having to have from the congratulations conference some with thing these business. he higher the have there the Do repurchases a the bonds buy environment and associated debt debt understand for in flexibility he shares? much any in financing that reflecting

Robert Bugbee

not related a fairly points, It that's that. simple penalties to transaction that doing quite standard. it's really and but repurchase by they're the different terms, simple turnouts -- be start not have following otherwise, may options, those efficient to in really leases fee they and have at And

about of So, as there's expensive preventing really moving preventing the to capital buy nothing that stack nothing talked preventing, us from more or the that is refinancing stock parts as we us either. earlier, is nothing back in

Unidentified Analyst

Okay. of you increasing guys to scrubbers outside other And emission to separately, anticipate your newer stuff having they newer order there steps any goes moves reducing as needing fitted ships. ECO far take? in Are take ESG and standards? having that as Or and emissions, the meet can towards to ships

Robert Bugbee

into interest. But questions and think appreciate all, first really really the of ESG before I [indiscernible] just of your other and the is areas a not that, that's [TAM] great that, maybe your goes we question.

noticing it's one what seen is for sort that daily there's doing I And doing, estimates create for some of helping what really market and for day-to-day. and we've so, hopefully market you mean, poor to market, doing. investors of things LRX of what example, is the an we're our LRX that really help polling will information market for related very the is actual, great

do many accurate, a what actually do. most also example, accurate hard through LRX other most can really the shipbrokers your tanker in work There and that that, itself, Now, tanker, private determining data job. to there non-publishing, think and pass good And is is triangulated answer Clarksons times the do And the go to we've making Cameron. the said very potentially through out for a for we fixtures. question it go and being a effort is, to to services the the I'll over are recalling, to

Cameron Mackey

It's Robert. thank Oh, you, question. a broad

Lars operation great to and first includes on response, five these ago. not sustainability detail. the great interpretation a to refer But advanced and bit deal sources how which these report, our just of crews three, our shifts analytical a training the from the As designed sensors, the constructed earlier we are of the and us they're our of in on of and profile, footprint four, referred the a environment. out this in interaction type analytics of obviously vessel variety lays a I'd emissions vessel available board some to that analytics, carbon that of thoughtfully it the our its But into little on operated answers additional years tools you and and comes that of ashore, progress in

the the the the has technology water routing with vessels and coefficient and the or cleaning them, where shipping vessels technology friction but and they things you the with When footprint. that people emissions airplane adjustments, a a has and goes So, the course point reduce around vessel has to and on all our depending of B, do to when, and whom to vary commodity. And to the of from coatings the And how the things. to of and frictional these most effectively most It speed think know, car in and you that quite routing you between adjustments, to industry fuel drive another, that of this it's deal, efficiency your do huge a vessel. that on led get has rapidly. it way optimally finally that management course are through from one and impact purchase think has great advancing from the importantly, different fuel how with when increasing fact in a about bit, to efficiency because of the you do its as bunkers A managing methods

So but other more year, And to is also would, and come points lot you see a as far these and that of in. improvement again, put every discuss, topic I this as improve. would basic all I are big resource as we've a improves the there's our technology materials you'll

Unidentified Analyst

thanks. Okay

actually to material developments you you Specifically there think the Have are few in years? as as able been credits on trading credit. carbon as effect goes, a being sell to the purchase meaning, going any that next far have guys

Cameron Mackey

Oh, thanks it's point for working and the something question. on a Actually, great we're it's currently.

to You're LNG, on and but on it's an working trial of initial them monetization customers come in credits. bulk dry industry one see the tankers starting of currently into into selling just we're with credits slowly largely our our coming carbon and

next there's developing several different to and this great right in we're that of become very an this you years. a Obviously, expect the in bit around on about the middle put offshore but shore, jurisdictions how industry we activity so, excited And more it. them normal credits we're and and a from take

Unidentified Analyst

Scorpio think carbon heard, Did that selling credits. I catch that is just said I you correctly? I Tankers

Robert Bugbee

them our far be in would credits as customers. customer IMO our we regulators to and transfer of set. Yes, that of some can emissions the transferring that Well, other to we target are ahead we we so a the have have

Unidentified Analyst

for you a interesting. call future really looking That's in the calls. and on Okay. having me to guys Thanks forward see the lot

Robert Bugbee

that of it's say, question single of we then, say that of in better. I you from We have, to we actual it's we've one generally retail, some analysts also say we've of And information communicate group really and of the really is we the we communicate them kinds quarter to let's prejudice are are calls try sort analysts terms group the and them. them whatever or gain what And or this the by that perhaps hidden sets course, providing from of key, let's conference let's with beginning know, day know analysts of on, between. quarterly in just and interest or of say growing you weekly going and a the show every interested, more you. lot but a that I call evolve, at know allowed not shut just that cetera. of know banks opportunity we're of widening Thank and and sort that market et that following got of And that key market investors. of some And companies the like allowed, as just to investors daily webinars question have then moment good the that got a developing just would and your two will And cetera, literally a question. know at don't make a not the sort a up said out et we once communication, then

going So, or open through providing into email to that. investor intermediaries some Zoom to, we're more call look maybe a let's try an to, or through really that's whatever say, or conference anybody, an and asking like have interested opportunity who's much call

but can that. how finalized out we do how to We do to haven't that, work hopefully

So, educate try and the better. we can community

appreciate So question. your

Operator

any turn I this the further time. further no questions showing speakers am at I for it would back to to comments. like

Emanuele Lauro

you us and today speaking Thank very look much. joining a Thank day. forward I you to every Have for great soon.

Robert Bugbee

you. Thank

Operator

conference call. Thank Ladies today's this you gentlemen, joining. for all concludes and

disconnect. may now You

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