INSW - Earnings call transcript Q3 2020 | International Seaways, Inc.

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Operator

Good morning and welcome to the International Seaways Third Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to James Small, General Counsel. Please go ahead.

James Small

you. Thank and quarter Seaways of everyone, for conference to third the XXXX. welcome morning, earnings International call Good

Before we today begin, by advising I would like on call to the with us of following. everyone the start off

and the statements pandemic, the of purchases that products; based other management other call, periods; world. off-hire in of financing expenditures of developments activity ongoing tanker the periods; of believes and are factors, factors the production charter and achieve take XXXX various capital fourth industry, its expectations for such other following effects company's markets; the vessel the trading to other company's days; scheduled the or demand by and topics: projected changing this petroleum current alternatives; account ability circumstances. conditions, and including in International consideration management trends, of limitation, historical transactions; to and and forward-looking the economic, hire and for Any or regulatory of quarter political forecast management's experience made developments address, future the oil tanker bookings the on estimated other and assumptions management of statements oil TCE around other number perception a and G&A regarding into which strategic rates including of the other and expected consider and forward-looking drydock expenses, During objectives; regarding world estimated or revenues XXXX investments; and make appropriate crude economic Seaways vessels outlooks without of and may and in regional COVID-XX the may anticipated financing and strategy; and patterns; company's sales expenses; product

and many XX-K are could in uncertainties Exchange made statements. expectations expressed to like in Seaways' of actual the company's or cause Lois Forward-looking those which actual XX-Q statements report results on the uncertainties risks materially those With over which Form the Securities I the control, to from and cause that to Chief differ and Factors, annual in that President to or call the and Form described by make of beyond on reports way, Ms. those results the company's out to could differ and Lois? turn other assumptions, from subject risks, are implied its International future company U.S. filings Commission. quarterly Executive Officer, with has may Zabrocky. and the our would include

Lois Zabrocky

everyone. quarter Seaways morning, you discuss earnings Thank our International to you Good much, for joining very call Thank third James. XXXX results.

turn we global take seafarers. ship’s a service but standards. cargoes our safe, this admits slides, and for customers, to minute at job adhering the to of our our pandemic. of We're our We reliable, the remarkable transportation Before doing our crews highest only level on thank of Seaways I safety, professional seafarers are want we're The to rely to our proud and seafarers. want of grateful efficient to energy ensure I and a not

continues continue getting to And necessary. prevent we virus women every their situation, time. shifts our COVID unchartered increasing and repatriate challenged, and charter their In families. numbers home spread safe flights overdue it to and extra look the to of of important get made for convenient good seafarers on the numbers when them for crews, for families waters, In cases our our keeping more men we remains priority ports back deviating and our this worldwide. seafarers, safely restrictions measures to implementing have now such to strides national keep highest shifting opportunity arranging and these This quarantine vessels, off to local have crew. in Our private will dynamic to these steps the taken reducing to and was be we as

quarter, we results as product four X, with the look a quarters to record strong of Now Notably, a reflect this On a if weakening earlier turn results rate you favorable first generated take environment. year public as we two of recent remarks, in a in starting fleet crude executed third the the our accomplishments strong the as charters prepared and third strong at of going bullet. performance highlights very company, earnings our our the consecutive to time Slide in again, and tankers, third our quarter sizable rates. well quarter

one per a share. we time excluding income items net $XX debt asset the refinancing million, to and For related earned sales of quarter, $X.XX or

third adjusted of year-over-increase $XX $XX million. This million. was EBITDA quarter Our represents a

contracted XXXX Oil value revenues look We the our contributed second position current Petroleum North joint excess highlighted our contract joint This our the ventures and XX-year period the and on operations continuing of revenue in assets. Al-Shaheen ventures. extensions. these FSO in value optimize oil Turning Oil forward XX% whose Total. the are we of to FSO inventory announced We shareholders a of the These by million joint extension to support of strong favorable and XX-year the commercial to for destocking. lock North Based these custom-built specification XX-year generate ownership we Qatar ventures, to our the term both period the in contract field over $XXX and generate Company. lock allow in Asia coverage extension bullet. Africa to of signed These in the expect Seaways that Company's to revenues important through FSO International significant episodes week, our with the during high

that further contract per joint during earlier $XX,XXX four quarter, rate we signed year extension, the current venture and average addition the in VLCC during the to fourth earning time the visibility the and In day support charters environment. challenging create

sheet shareholders third and capital quarter in balance to outstanding our strengthening $X.XX paying our implement buybacks. allocation to of Starting and you strategy first we've form and of returned per dividends share significantly year, share the capital continue both bullet, we in move the while success, our structure. capital our X% in If Since we dividends. delevering of quarterly shares, disciplined beginning XXXX, following of the the the accretive nearly repurchased to our

FSO strengthened with recent have and We our potential for million This which agreements sell balance to further our buyers older November combined the and to XXXX, vessels, three $XX generation generating INSW. success between to with cash sheet extending our in cash expected deliver contracts. are our January

provide has program authorized our value. find $XX Board share benefit of our the to opportunistically the attractive to We for and intend of to Our act million. continue shareholders to increase buyback shares

the in $X.XX regular quarterly dividend has quarterly our our of approved paid Board to dividend, regular the of dividend payment in terms following $X.XX of be December. September, In another

the delever, we transition loan full under facility $XX million to by term We $X.X outstanding the third during million. expense our interest also continued lowered quarter. repaid This

our from $XX,XXX takes as rate venture as time to approximately forward FSO our I and day, Importantly, breakeven mentioned consideration we going our into the earlier, VLCC the have per reduced debt well joint contributions which charters that repayment.

bullet. Turning last to the

strength. shareholders tanker creating value We operating XX%. have to This continued net financial for with to through increase the bodes at well loan value cycle and effectively for our

the of revolver. including This about cash lowest total million from of leverage end. We excludes the one profiles with a an undrawn We ended this $XXX $XX million prior FSOs. among and $XX peers. the liquidity, of is have the quarter continue value our quarter increase And million tankers to in the

the XX remaining the have vessels also of after unencumbered. vessels We that older unencumbered sale three were older

day of are and their tanker X anticipate to has update decrease have stock of by and surplus helping per Turning an in been the oil the built dramatically increased as COVID-XX barrel needed recovery. the XXXX IEA can demand economic the for IEA million to draw a quarter XXXX. believe demand. throughout demand a to during for drawdowns The end barrels recovering quarter set stock million inventories supply quarter, stage and reduced the rising Slide oil the in you fourth impacts the barrels X. demand chart. the million XX market on We for to that the see XX the second of when We that up quarter, provide forecast the With fourth

levels supply, and XXXX demand be additional during XXXX, we of the by are of diesel tanker ongoing. of of day which end OPEC On rates. the The more supportive produce are discussions these the inventory at increased year. OPEC Combining the an levels IEA also barrels although OPEC supply demand million XX% side, gasoline increase to process demand, stronger currently first of and per quarter X should expect the to intends normalized destocking expects

the of Slide at been Only in We supply. continued Turning update can confirmed lows the overall that to The decline historical in seen to ship the order XXXX has chart on XX VLCCs understand of handful VLCCs XX ordering. as only the continue we tanker new currently right ordered X. top an hand to under were be believe the to book suitable We additional are had provide meet uncertainty regarding propulsion limit and when decarbonization ordered. discussion. systems although well market, follows as regulation to questions decarbonization orders goals XXXX to-date, This slide.

XXXX. the with Moving for reach noting additional a of at We shown slide. of will years an the old vessel of existing quarter the slide. VLCC these chart now to It's the the years potential recycling right fleet as during old bottom bottom half XX over in were highlight XX the the of worth XX

stated required. no These have and required in environment with there we reach investments treatment have to reach of expensive once thus capital they far. deadlines significant age, XXXX, Due continue operate consistently, the vessels recycled to years ships to expenditures will As this strong more XX and rate water ballast been VLCCs XX earlier greater to year, even are trade.

likely continues details to call are environment turn results. our recycling particularly to However, additional now provide Jeff Jeff? presently the age, the will rate over in. given quarter we I'll to low Jeff is and the given third fleet on increase

Jeff Pribor

good and everyone. Thanks, Lois, morning,

to directly quarter third detail. reviewing more results move the Let's in

me diluted a the compared the $X.XX let income of $XX.X $X.XX EBITDA third quarter deck, was third to quarter the in our share consolidated quickly per million. diluted to XXXX. per million the for turning or $XX.X third Before In loss or million we Net achieved results. of $XX quarter, share of summarize

Net However, $X.XX and income of $X.X extinguishment financing of million a on vessels impairment charge the sale excluding with share. debt. the associated million, of write-off loss costs per fees was and of or million diluted $XX.X impact and deferred $XX.X

could quarter the This last VLCC, to increase the X. of discuss with segments $XX TCEs were primarily year. segment. Suezmax, $XX our in compared if higher sectors. rates third average of the turn results Slide resulted impact quarter Tanker segment the Crude blended from the beginning Tanker million to for Crude I'll Panamax first for business of the you the Now, in million and

revenue quarter their quarter owners quarter of Overall the fleets third top third XXXX the primarily increase of Higher for to between to in in last quarter. daily Turning quarter, million the of left, compared the compared in principally crude fleet year’s TCE third the third third segment, and earned the a Carrier in were LRX reflected was the compared across rates million to as blended last TCE daily redelivery and MRs by of were revenues MR $XX for quarter by period-over-period higher four were year. driven this chart third $XX the The Product average substantially the offset July XXXX. decrease earned of time to XXXX revenues days quarter, million the by in average XXXX. quarter to chartered-in consolidated million, as $XX $XX MR result a the rates

XXXX. at million at the $XX to the again, crude increase page, of right higher was And in driven for the $XX EBITDA the adjusted quarter, the Looking by same chart million of the period compared daily rates. top principally was

$XXX as quarter the months the for XX it's page, from decreasing i.e., TCE bottom EBITDA right-hand the revenues down of important Consolidated at adjusted million. the $XX by our to half results second the third on that shown look was and EBITDA the the Despite latest page were On of million. quarter-to-quarter. adjusted sequentially, quarter, side decline, each we highlight the

we earnings a review update of as provide turning this Slide to third Now quarter and point. fourth X, quarter

an in an Aframax and XX% average average day, XX% of of bookings thus approximately available Suezmax have QX average day, approximately spot an day For our spot of and XX,XXX far, days $XX,XXX available per at of spot available days per QX per for VLCCs at at of an average we of XX% booked and approximately Panamax available $XX,XXX per XX% day. X,XXX spot days LRX days of of our

an at spot MR our a have the XX% approximately On day. we $XX,XXX dates side, of average third booked of quarter

period were strong provide well stability our a previously, in days the combined on challenging a rates strong spot of rates the concrete you visibility side accounted even executed that for the extension mentioned coverage this the a earlier new the FSO of Lois from top at number year rate VLCCs during very time VLCCs environment. As earnings favorable we with XX-year And as if the and most this for. charters and for with see four for our a right-hand as of with charter $XX,XXX page, XX% time example, look QX contracts you'll

cash earn Now, daily breakevens ended ended are per and cover slide. taking FSO September revenue breakeven costs, interest that could figure. rate are was time XX, for The our on debt turn to G&A service drops the owned operating XX, days JV XX. for a in last vessels amortization if our rate for means and cash overall spot as costs, day. you must all-in illustrated September overall our consideration, $XX,XXX TCE as distributions revenue, the drydocking to the Of $XX,XXX These XXXX, XX note, XXXX. the which the to Slide for rates breakeven months expense months months the XX International well rates XX day vessel fixed this principal expense cost Seaways costs, from scheduled into charter

per spot revenue FSO Also the XX right XX, contracted I the far four XX from as normally day daily side this bar consideration, months. do, during $XX,XXX reaffirm for Taking for modeling to of we the year XXXX. I'd days breakeven purposes. into time, the charters is and months like next guidance the time ending rate the have included the the revenue overall cost at breakeven On forward rates our for chart, all-in September JV the

and includes VLCCs $X,XXX expenses fees daily excluding case all our management quarter, per for and which day; related to classes Suezmax, for for $X,XXX as costs, COVID-XX. insurance, For X,XXX; impacts for the similar day. to we be each per fourth any trivial various OpEx, Aframax, Panamax X,XXX; expect regular X,XXX; running other follows: MRs, In of

Continuing Slide on payments modeling, details days off-hire an and your in to reduced can to by $XX million this projected refer interest For guidance cash drydock, update. with appendix fourth in for expense the you XX the quarter, CapEx be cost is to $X quarter. million, taking into quarterly expected quarter our schedule. consideration also beginning payments transition quarter, reduced which the our payoff most per principal of the million from principal recent quarter $XX loan, per for

in million. quarter. For G&A quarter, a be fourth of in we finally, $XX depreciation region the we million and about cash in income for and $X million And to amortization the equity expect expect the $X

Slide could page Now, ask turn if cash XX I bridge. for to you our to

the cash began from $XXX total Moving quarter to left of with we right, and million. third liquidity

million in million During is the quarter, includes $X which from the JVs, $XX noncash. generated EBITDA. we amount equity of This adjusted income

add from this the which the figure, to back quarter. deducted JV a cash we but the $X last million JVs, and were then FSO cash therefore, So reach distributions

drydocking principal Cash We million. in scheduled payments CapEx. our debt in $XX expected was and interest on $XXX

a loan, $XX optional million Finally, yielding of the $XXX into dividend of with million. million capital and changes at the net liquidity revolver impact was of and total account of quarterly repayment taking $XX the of the quarter cash end $XXX million. million of the positive result $XX The approximately other the and undrawn transitional working

I'd Now talk turning our briefly to like balance Slide XX. about to sheet.

we long-term billion assets to debt. $X.X million compared XX, September of As of $XXX had of

million we XX. mentioned, as had September credit undrawn remained revolving as that $XX addition, facility In of a

side our loan-to-value slide, net XX%. conventional at our our stands cap stands As on at to right fleet see but debt the net of XX%, total you of can the

of tells is account As footnote taking one it the that not you value FSO. our

X.X XX%. value if was debt therefore, So months times. to just strong EBITDA to million. you Further, FSO’s EBITDA include value in XX a LTM was our net net our the book very debt number last drops $XXX And

Importantly, significant of us forward. in revenues value generate and of contract are excess assets lock joint extensions, going the $XXX venture with optionality contract million for XX-year company, these provide of to the which expected FSO in

Before this to call continued implementing sheet creative to year. capital to success to I'd and turning back discuss and capital the We've which structure, strengthen delever significantly capital our like to begin over our strategy return positioned balance disciplined our in Lois, our allocation to shareholders. us

so XXXX, First, putting X% a executing dividend place while per have share and Notably, far. in regular share then outstanding shares quarterly $X.XX dividend, in we nearly buybacks. our of repurchased paying

cash in and further extension balance which three As of visibility. the mentioned, Lois light our of and JV of vessels, sheet generation FSO strengthened the our older sales contracts

authorized program That relative back further now I'd has call simply the to for buyback to at find attractive. share a remarks. price be these to comments. of million. that her financial Our to our closing say very renewal I'd Board NAV, turn my find we includes Lois? $XX that share our we for Lois valuations like the

Lois Zabrocky

a despite some wrap the Slide product the than posted $XX during of rate was the call, million quarter. EBITDA as and this well leading fleet favorable highlights solid executed last rate third of our Jeff. challenging earlier contracted Thanks same quarter, period sizeable up generated during charters third strong XX, revenues double We Notably our time more reiterating our from on tankers, our environments. what you as environment. that of year We year. want our quarter lot, the to from a we crude substantial With

that we The XX-year a the $XX,XXX on earlier extensions period FSO ventures addition signed joint year this quarter. averaging market. in to contract our strong provides In time a for four fourth the charters day challenging coverage per

to generate This tanker cycle the these the during $XXX position throughout of and to value optimize extension million revenue of of continue important us strengthens assets, in optionality. the in expect locking provides revenues excess with significant period. to to addition contracted our In we

and returns third shareholders. value the quarter, providing our capital During strategy, to continue we to on execute deliberately creating balanced disciplined and allocation

authorized our Board program from $XX increase million a to of buy $XX the has back million. total Our of existing share

shares present the opportunistically of to an continue and our shareholders, to We opportunity. benefit act we find for attractive

During the and of $XX,XXX among tanker This strength to time one represents peers, to a value financial have have total has loan by of net improved. in $XXX per when and we day, highlighted breakeven liquidity. our overall profile delever leverage reduce This our lowest continued we is XX%. the to our levels million

remain take advantage to return you forward, opportunities strategic Thank a to open of capital they And questions. shareholders Going much. in like position would to and very to to it we as arise. now we

Operator

We will Jefferies. first of The question question-and-answer from [Operator now begin Please Giveans comes the go ahead. session. Randy Instructions]

Randy Giveans

Lois, all? how David, and Jeff are you

Lois Zabrocky

Good. Good, thanks.

Randy Giveans

Yes, on is your I extension, than new for Excellent. on for the $XX EBITDA more Great. contribution per contract based years. XX FSO the first, think congrats XX% obviously our math, million year

INSW. So is non-core for clearly a that asset

thoughts from the the are on what maybe joint your the selling other the right, opposite, even either your So asset? of venture own buying portion or XX%

Lois Zabrocky

not of Well, from field exemplifies especially so assets, really markets when years hire being of I work this secured these Randy, moment. the certainly how think hard particular represents the XXXX, have on pleased indeed, zero we're time. off conclusion renewal, this – We contract this at having offshore and to the stellar are absolutely and

with options. assets having us, for consider and these and explore forward. shine have our partner, is do how we'll concluded this to we joint to and So huge for be venture. We do these non-core really And JV the a assets makes going this monetize maximize conclusion it, project

Randy Giveans

a from the shine to what the little, the the monetizing segwaying assets, and [ph] sales three us provide decision And vessels, are with the associated impact maybe proceeds to guess liquidity aggregate debt you with get on repayment with those? I and on sell Okay. details additional can that older

Lois Zabrocky

a the was beautiful team is million the down paid Yes, $XX transition on older thing loan Jeff's the loan that vessel.

and So into in are $XX these million they Seaways. in three unencumbered bring vessel International sales cash will

for vessels? level, we sales a that a we felt then money healthy asking why that those in bring and did are into sell the were utilize allocation to that We capital you able and particular way. company better If realize

Randy Giveans

use that’s a in repurchase here? Well, number, kind the the cash even guess, that I following-up or priority of still debt that, just on right. is share all Is increasing meaningful the the top top Wow, without using authorization repayments third you're of quarter.

Lois Zabrocky

you to do Jeff, want that? take

Jeff Pribor

lot Sure. a Yes, on third had we going the in quarter.

business. all kind this was but year. unscheduled million repurchase, we allocation unique payments asked I've down a interest of But we been take of additional of and deleveraging types and but of before, definitely done delevered mentioned will by of capital the transition four care or additional bought very care million we early on, $XX in we the of that So scheduled ship down, have including taking deleveraging, business, million and a on were thing. we end we that hope the the dividend, pay But year, Lois August. we that question – based voluntary share $XX $XX at we'll an debt take regular or But have

because you So, think saving of pretty cash. money we like It's healthy lot on a your amount. make a don't kind that's

debt, down allocation. again all the for you putting whatever you – how see the in sell it capital and get available a when out paying like proceeds bank So vessel have back it's piggy money can and you

months we're me final times net at think comment Randy, you heard debt good XX level. a it So and is say, last to than I'll – pretty thing trailing – then X.X I less EBITDA,

Randy Giveans

Yes.

Jeff Pribor

we don't prioritize leveraging. I to need So, for think

as So pretty a I cash. value at think, price well, using it’s share look not being we these for our those prices, attractive at

Randy Giveans

I Thanks much. concur. so from it All right, that's me.

Jeff Pribor

Thank you.

Operator

of Your Stifel. ahead. next Nolan comes go Please from Ben

Ben Nolan

I yesterday. it if brought of of I LR docking in was forward didn't that Hey, is X was there's you a got it Number was there was, some like morning. was, that couple. the general. that Hey an curious right. different in have think – it looks I way quarter. I if call dry it apologize a awful one Panamax good and the know that or lot fourth up I but this came And guys, on

bringing they doing the is could, dry are I you that guys docking of a was trough forward that that that I in kind here? something extent market think to this when

Lois Zabrocky

many know, due there in were the You and actually many for these of congestion year, that them Ben affect a repair earlier of yards were very significant difficult vessels, the to to docks some dry And able to – and were able those we COVID-XX. push earning pulling the of of a were the few. dry docks market we because indeed we was are beautifully, drydock

So also very when period dock us. having a is heavy implications that from from QX but combination market and doing pushed is a time pulling them, dry And for COVID is of it time lowest. the at the the

Ben Nolan

Okay, really very commoditized I'm is are another to to crushing And shipping it is unique thing but you that really in business, a on really differentiate then which again, position curious you your that a about there. relatively is do to in hard Panamax you just in able doing guys helpful. seem and be on are

that function been crude Panamax trade Pacific Although Panamax, there some closed, is in there at of a any has fits your that is ending really West that well Coast there's coast where a Is up? risk rather or more than where risk it's the it all, international being of that's that of refinery is maybe business? sourced with at others, talk

Lois Zabrocky

to to a but West Well, there because have would refinery various we're Coast, inordinate Coast. particularly an And some continued marketplace. very closures, in are and following on have we And think don't see refineries movements turn these the to some going of amount I And asymmetrical the combination. carefully the you of it's Ben, I we're on closures. say bio into U.S. definitely watch themselves trying see been facilities. West may that diesel

in think closings, we're in of refineries U.S. some going of I the like to down a convent, Golf, see smattering Europe. the

what see presently, we're see too don't But the particularly to we So Panamaxes. watching disadvantage that impact is. the

Ben Nolan

have guard helpful. expecting I morning. I That's caught this me one Okay. was And one – not comment that. off

Lois Zabrocky

Yes.

Ben Nolan

fantastic little I closures product for I'm general, refinery the you're tankers. product out a if larger more curious these of for – long-term the this in view is guys, that for all your as bit hey, to just tanker outlook are And fantastic especially maybe think,

You of kind play guys both, right?

Lois Zabrocky

Yes.

Ben Nolan

how you oriented towards necessarily for do little playing do what of that? think a one all out are You're, towards more is yourself of you position how doing the or bit having without think sort But bias heavily a crude. other, and to you this

Lois Zabrocky

of We are for that couple put the China the clearly not. refineries And them, have have they are it's of on years and brought That's as you to once or a very watching day everything Then they crude exports barrels Obviously, the has more over China. a enough demand over coming. ideal happening. million see still in, of you two whether out going carriers. see run product they lot then last

see quite in So we'd a that coming be whether should be lot be and for That in up, see LRs, certainly online. the of that the now you're or good clean perfectly this to them there's clean number and midsize bolster are dirty the to happy dirty. trade there of Middle we should East, that is linked that remembering going LRXs of the market, fleet, LRXs you're refineries that a significant

that following the that the with send So, most the next trends going interest we so we are all dynamics. that think have watching sure sectors to in making dollars and there we we're great the of robust this are

Ben Nolan

– at have of now. But line you Okay. you're you to what have don't willing right to of say sight means kind exactly that as or least not that

Lois Zabrocky

are we're we're opportunities think looking I to for, we and here cycle, going be where the are. through pretty pretty this – No, down go as we forward And opportunistic.

Ben Nolan

quarter appreciate guys. it. Nice right. I All Okay.

Lois Zabrocky

Thank you.

Operator

Nokta Securities. question from ahead. The Omar Clarksons next Please Thanks Platou Ben. comes go from

Omar Nokta

buying the attractive stock thank sell Out ships at whether Lois of come hand be today's or seem that at Hi, prices. you. and vessels words, you of of to be Jeff, hinting stock find you it irrespective made pretty And would sort clear not? pretty you've pretty with you does quickly. guys In you buying curiosity other authorization to back sell? Board agreed the hand decided to in the the back you

Lois Zabrocky

are not that's world you're today's I'm the at not because middle the rates stellar sure in such a Omar, simple in levels. of where and Well, question, if coronavirus

look as your quite which make what company, with what company. think best your – we we're picture is your you use that, whole to judicious and feel sure is need your what's liquidity, capital, and strength the I financial the of comfortable a at of the

comfortable taking we and So, we buyback what vessels, selling pretty where some the program. look you can move then these with be are then think And the older to company, be at above what when recycle level we you're is I million capture our entire significantly. extra value believe right the that would of $XX

lead think, if them of liquidity in I happened if we'll where position and what type aside would we the we do. as buts, have So, weren't a have we to

Omar Nokta

Got Okay. it.

Jeff Pribor

Can – goes add Lois? charters, I that aspect the time could for right. I example, just add Another it, is just into

time but as FSOs, have, charters course will the extended entered of we into, the but they breakeven. we down that's be the revenue the later, well as So contracted brings

debt you So, right. break the highlighted deck, amortization, at when evens in we includes look which our

So inclusive of in before that's not debt amortization. amortization, it's that debt number

could you a a what So, you – that market. in a in of you terms of think a generating weak bit do window into gives number cash

that's part So of well. it as

choices. piece the your not was thing all as you what any it's like capital it's So said, it's look allocation at one

Omar Nokta

wondering one. clearly to you. and thank hear if good to hey, cheap, buy bigger it's as, sell come that That's some let's is it's Yes, our not a holistic okay, And just pretty stock had was view. ships picture, I definitely some stock that clear. about

Lois Zabrocky

are is, These on months plus old. sales of in interesting many many, fact, particularly are some XX years in what's development. that vessels No, the these

time kind buy may And do it to we we to able try what an believe is happens right amount that works serendipitously we out take the the moves the what to right then to back cycle. in able be for just or similar – right believe the of be to. it we're So we

Jeff Pribor

But the leave goes vessels far job well, revenue the a that's at at point use clue we part is secured Omar, good It's entirely. little left, that And And verbal our then the of then their amount company some as that older with facility we stage. the benefit right. lower – stage and best last January, act right vessels did older older loan with get in the to time exit as of of vessel. for and a a that's if call transition these and

be their would normal in that course. So happy

Omar Nokta

looks definitely It act. I know. had Yes, they very closing a like nice

Lois Zabrocky

QX in yes, they beautifully contributed strong. just, and Yes, very QX

Omar Nokta

mentioned the Yes. of positive seems least the itself, run. just, year project color you thinking? investing assets certain acquire sort joint we sort maybe And yourself can And think you give the of investments have look you that some specific, past surprise. JVs or level you type past the course, thinking doing this of it sort are nice level? of When you over Lois on the most this guys JVs, see evaluating nice mean, companies see opportunities, do Are if of company at consistent, the year, purchases outright that like maybe a of come on really, about about that you other with guys I venture had you Do to a had markets and making in now yourselves in. then type Any project partnering tanker the on more that basis? for market further at been

Lois Zabrocky

partner Well speaking a I episodes guess there first venture would wonderful answer be joint the the had we've contract partners. and an about part and on of that specifically

believe mean, to us you do from achieve figure a what of And look be innovation when when should However, that and trying in space. and that me things, lot ventures, is think, of level expand expect decarbonized Seaways. talking going tanker out joint future International be I effective bright you there the to at from looking like that the all about in of not will that's to we and the a place for and to take really non-research technology, minds about you that. will be to ship development a start going something because you offshore look side, could ventures does start when I owners. what higher there's joint not talking required I that be And most to that

Omar Nokta

Thanks thanks, well. that. Louis And great. Jeff Yes, for as

Lois Zabrocky

Thank you.

Jeff Pribor

Thanks lot. a

Operator

Lewis go ahead. Greg of question comes next BTIG. The from Please

Greg Lewis

buying thinking you Lois, maybe be. want aggressive the kind morning. to done you. the probably ask prices asset get is you does it the sheet, to the a about strengthened mean, they where started start curious use really longer going return always you've is in I balance Because come I'm little good just go anything position how at the bit you differently. you about you've to can balance everything load and developing, ships? sheet term Because Yes, six guys you a outlook said, guys I next thank a have to up you bit seem that? do that should – strengthened and it Clearly point like last the I'm a Clearly At down. what market it the And bullish year to as there look thinking I guess guess maybe months, you've are little as you maybe I in really a is cash does what over kind of of to shareholders, not how balance little it market, have have market So lower. do are seem like are see you've guys how kind but point, ask at way great here. of how you in this sheet back the

Lois Zabrocky

and on that looking we'll perfect We would can that the and opportunities. period. six-month at to market, then a maybe at the we're continue the that seems following for be market, looking agree opportunities And look are say coming to It us obviously probably of will think the call we constantly we where be destocking as media will but and you never bottom the at accordingly. about

Greg Lewis

use is that use mean, to use balance in, best just ships. buy a of you below to stocks the your to fact with dollar when clearly NAV, think stock. I you it buy balance not trading sheet so when – stock, the the to obviously buy to about your probably But can you tie And so you're sheet your can going

guess, level price, much after think does discussion there curious you you at that, that or discount stock as mean, you whether NAV I about come guess think kind think So of to that adding we not that can just about about discount of – of a how it's a all I to and and the too to about NAV. is in to I fleet? agree going the I'm just a – like – or

Lois Zabrocky

You’re going to get a formula out of us.

Greg Lewis

Sure.

Lois Zabrocky

look do. price, But as lot is what which we I of does never represent little purchase And what that. you definitely a thing. our no think as going a it’s come we says, But let then we're a – do ship bit at think at right, people is look wise. share And Jeff I to balance everything price and a about I'll bit Jeff of talk little always one that And in okay. in,

Jeff Pribor

Lois I balance mean, how us. word is Well, key I with sure. the Greg thanks it. That's we mean, see

looking think with company mix any should and you allocation of a be should continually. – things good them evaluate I capital strategy be at

buy I that's of to amongst allocation. allocation, how And said the as of areas. Lois capital as – is sort in something financial capital That's capital with agree – would borrowing to So to term speculation said. do opposed that to like just different we few you a that it's be I kind formulas allocating it. definitely do our engineering. has not

But is minute a the is look at So little of again always sure giving as we where estimate you forward has falling versus any that effect. a more in without where the it. your forward think is that's we that and I current But could know? to or see of NAV, a could ago, you got are an have below you values make formula Lois sort said safely be you're if be equation NAV, may look stock thing the valuing how as when other now to case that want

Greg Lewis

as get on time, certain agree at perfect. then that at market I'm market? going to still a big we trying OPEC about October barrels should does, that me, the half did really I ramp starting but know September. a volumes, at production. And like tighten at day, the the had, looking that I just I more terms what in to OPEC think, noticed a in didn't one thinking is And at brakes. that like was all really that in point ramp just go look of we can happens, sure, not have versus really all? the mean, we But production Yes, how Okay. to to from is, it I'm just trying understand be looking the rates, Did there’s up guess a foot million it and increase And that

Lois Zabrocky

lot little volume market on for piece that storage, think brief of a vessels maybe there of a healthy. a But a taken is I to happen are what pick was couple moment needs become which is increased weeks rates coming There did where to for up off of a that that the bit. being

XXX QX. where So powerful, I think we're that's is just period destocking, day right, IEA million and four barrels. barrels in million painful down in mean, this I That's a the coming you're

got You crude million They X.XX see they in coming X.XX. are around to at were around commercial They heading now see close direction. you that somewhere U.S. are average to the want had stocks in XXX touch or barrels. the them that five-year

we storage. and think, unwinding up drawdowns, continue of and that I the the to see So, demand picking the

together. all coming these So factors you have

few But pick additional then us of there'll increased unwound, and absorbed months a we happens, see we going – to the came to you're out. be up. need those So that ships and while that demand as the they've will destocking think pain market barrels have

Greg Lewis

Okay. your have great Perfect. a you Hey for weekend. time everybody, thank and

Lois Zabrocky

Thank you so much.

Jeff Pribor

Thanks Greg.

Operator

question ahead. FBR. next from The Riley B. of comes Please Liam Burke go

Liam Burke

morning, Good you. and David. Thank Lois, Jeff

Lois Zabrocky

morning. Good

Jeff Pribor

Hi, Liam.

Liam Burke

it you've how line? has has the that do you now How challenge quickly and costs? that been both gotten influenced easing you. much deployment deployment see sort on challenge of cost operational for crude your And in cash Lois

Lois Zabrocky

know, the interesting what's I’ll first. question second is You the – part answer of

repatriate we that not measures would just glad because that we've resolved. people taken a this COVID cycle has been continues. normal to We’re really in not

to of fruit. for things easier So, bear get would not waiting the idea

to continued we’ve do So that.

flight cost us? So it's so the what have challenge, able repatriated, has You Operationally, be would ongoing weren't say. I you being cost. fact an to that people had that no

which occasional EBITDA our impact flight on it at we too do the were our rates or doing extreme couple than crew high. But deviations at Certainly sending is this for extreme. continue days. an should this of really had point you we're expect vessels to net on changes. often would we're more much Manila, us of cycle, the to hasn't When very point. that when cost a some dock, less is dry painful Now, income But cost in these

has what changes So it doing is cost an code that we when these broken make us. happen. to we’re out I a there of crew costed don't can have everything moment exact

what We Bill. would you had want have I that know, date. have or deviated, don't but impacted how Jeff, an we anything add to that to if things – have on to number don't exact

Jeff Pribor

No, think that's a good recap. I

Liam Burke

ahead. Okay. I’m go sorry,

Jeff Pribor

I think cost, that no manage really changes you crew we I No, but see some it mentioned, Lois really captured it mean, fortunate associated we've have. we perfectly. as the – to we're on has you been track. And

Liam Burke

maintain is last high business? Great. on to EBIT your keep Jeff, your see times, efficiency balance fixed is business, XX value debt structure, but in debt cost is I XX%. capital any operating you side the or hate lowering up capital to those keep bringing to to Are a loan just ratios, to are there the just in you X.X you months, content your

Jeff Pribor

say to it. Well, hate don't always to it bring it's up you about Liam, fine. Happy talk

a include this levels, on that and to I FSO value. at the maybe hit little loan I it the call value these think book book XX% I earlier at to

if as So, are went you on our mid-XXs trailing – there X.X kind you're anything look website. we based certain you debt the at you But cycle out examples are mid that said, and put EBITDA. to before decks net times of on to EBITDA

multiples, right averages, ships just at we've percentages, where having like see get $XX if about it's to the proceeds, like that. EBITDA, seem terms becomes we feel it about little a or I benefit sell our objectives right. good than older levels, or are two did, of looking all you of for higher concretely, like not it times achieved you de-leveraging. in right. debt three the You And Those it's it's time net to million, a can maybe

And repurchase where and we like So, share we the are. I I think think dividends. we've sized

if a close return income. It's XX% months’ $X.X dividend the a shareholders dividend yield. it's close and $XX is to little over share, net an nice X% that's already $XX repurchase million that right to So you XX of we've done, with proforma pretty to And share XX% million but the last now.

balance the So, it, just question you Board that asked most you you try use formula, of and there before feel that balance makes thing into was a to all a factors the makes kind feel the strike take place one was – one makes to or sense. what management any we

Liam Burke

Great. Thank you, Lois. Thank you, Jeff.

Lois Zabrocky

Thank you.

Jeff Pribor

Thank you, Liam.

Operator

conference session. This Zabrocky would back to to sorry question-and-answer closing the turn our – remarks. like concludes I over I'm Lois for

Lois Zabrocky

Thank works. we even add We in only find value. point you at way to very this downturn, for well not this Either much, today. weather cycle. actually that but shareholder the positioned everyone joining can believe us to to Seaways is

safe. So thank And care, much. you everyone take stay very

Operator

for The you presentation. now conference concluded. today's is attending Thank

disconnect. You now may

International Seaways (INSW) 6 Nov 202020 Q3 Earnings call transcript