INSW - Earnings call transcript Q1 2024 | International Seaways, Inc.

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James Small

Thank you, Jennifer. Good morning, everyone, and welcome to International Seaways' Earnings Call for the first quarter of 2024.

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

During this call, management may make forward-looking statements regarding the company or the industry in which it operates. Those statements may address, without limitation, the following topics: outlooks for the crude and product tanker markets and changes in trading patterns; forecasts of world and regional economic activity and of the demand for and production of oil and other petroleum products; the effects of ongoing and threatened conflicts around the globe, the company's strategy, our business prospects, expectations regarding revenues and expenses, including vessel, charter hire and G&A expenses; estimated bookings, TCE rates and/or capital expenditures for periods during 2024 or in any other period, projected scheduled drydock and off-hire days; purchases and sales of vessels, construction of new build vessels and other investments; the company's consideration of strategic alternatives; anticipated in recent financing transactions and any plans to issue dividends, the company's relationships with its stakeholders, the company's ability to achieve its financing and other objectives; and other economic, political and regulatory developments globally. current take a various management's that number perception historical statements management made experience management forward-looking future of on and to based of trends, the believes such are into other consider assumptions account by and developments appropriate Any and expected in factors circumstances. conditions, factors, including

in materially or statements subject to from expectations cause have made filings of in by the beyond XX-K Form Form report Exchange are that the which Factors, are uncertainties include on risks, could or on many risks implied results Forward-looking with make future that and described and those XX-Q Securities International company's results for differ actual annual quarter from the other report the XXXX, statements. differ could to Commission. which first U.S. expressed Seaways' uncertainties and our our those we to control, for and assumptions, the may actual cause in XXXX of

let President Ms. and over Chief to me our Officer, Zabrocky. Lois? Lois call Executive turn Now the

Lois Zabrocky

James. very quarter Good of everyone. for joining Thank much, Seaways' the earnings XXXX. you Thank first you call for morning,

on website for eighth find per share. on can presentation was million, section. our income of $XXX strong the quarter the $X.XX consecutive diluted X, our our Relations Investor Starting first You quarter our slide results in represent earnings. Net

over EBITDA quarter million. our This Adjusted two was $XXX than came in higher quarters. prior

million liquidity, On $XXX sheet. made the first revolver. At highlight undrawn had quarter, the the to our in that including right-hand upper end slide, strong total balance of we $XXX already enhancements million have of we we

or of into about $X,XXX converted per repayments across term loan in spot the capacity. Now per our day have saved $XX we have we facility, In and mandatory more year fleet. them about this revolver million our consolidated execution

have mandatory evolved sheet, repayments of how on two million. had we our $XXX debt ago in For XXXX, some balance perspective Seaways years

along mandatory our in our million. group. payments tremendous relationships Jeff months, is a XX the by forward the our embedded work This This extensive sheet. team, balance $XX with are for flexibility Now with under valued finance us his gives bank and

As amount We respond result break a XX% spot million to now quarter. of it cash the in generate per second With Seaways will revolver earn our $XX,XXX base of spot putting a these looks in to second like vessels significant even. opportunities. capacity, of the market have booked to again $XXX free our day a undrawn need in in efforts, flow quarter, position to we

we the ships slide, fleet under give are X of on detail progress. $XXX of we February. delivered end in aggregate. left-hand vessels lower May. the eco before The The taken remaining upgrading purchased X the of that In for million of weeks, our MRs On have in X contract we last delivery couple

outlines declared deliveries second X year. ready XXXX. deliver expected first shareholders. continued also half the lower in an X options building has the of slide LRX of return to We our LRXs The our quarter our program in for additional Overall, next two right-hand of the third dual-fuel to

double-digit and sheet declared we and This yield shareholders. our $X.XX XX% per a to shareholders. income combined return a of of our our quarter share. allow net another our balance of income portion for strong of earnings Our substantial strong Today, net adjusted us dividend our to represents a

returned XX than we greater months, XX% have actualized last and the Over return.

more position our the put by to balance We X now we next up to fleet in a our sheet our us focused Seaways, value cycle This approach for eco cash the generating in renewing acquiring shareholders. allocation. opportunity. to MRs. and and for at company create we're capital on are this these Here the We're utilized balanced continues strengthen modern

niche put have the and our sets the well than utilization. have some for industry new the increasing ships we efficiency [ vessels ] vessels. With will and this strong Overall, Seaways few fleet are cycle category, conditions. and this demand. covering more older trade, work but LRX to older market less seaborne MRs lower a paid up on of capitalize next We years selling the are stage the to positioned into over have remains for an these These premium building percentage falling the increasing

to to You over can Pribor, while to to provide count sheet balanced strong going to Jeff conditions industry CFO, to with I'm it adapt financial renew our on and approach our capital now turn fleet balance returning Seaways Jeff? utilize our allocation a shareholders. to review.

Jeffrey Pribor

good and morning, Lois, everyone. Thanks,

to $X.XX per for or about just X, million income first net the diluted was $XXX slide Turning share. quarter

On for we've the the a to first $XXX EBITDA of XXXX In adjusted right earnings. chart, million. provided the quarter reported was from upper adjusted reconciliation appendix, earnings

a the fell quarter of to statement. out income our note guidance the Our for expectations, few expense of like items first largely point within I'd within but range

On of nearly to in the revenue the outperform, million revenue million $X.X of of million. contributed in business lightering expenses, about about quarter, about quarter, $XX vessel of in lightering million in first our continues its earning million $X.X hire charter G&A, side, the $X record with $X business just $X million of EBITDA shy the and

of $XXX X, of our was capacity. million, we with total a began revolving now in in million $XXX Turning million liquidity slide cash the cash undrawn bridge to $XXX composed which on quarter and

the of $XXX cash debt well in or left of by quarter. in spent paid $X.XX bars $XX per to yield of cash the a million about strong as us adjusted that as XX, on cash $XX eco we we $X.X million from in $XXX the term chart and first first annualized represents today's We remained service, free value the the of expenditures is to position and second of revolving to moving Vessels capacity.Now the continue million. and undrawn the at mentioned, quarter in quarter. $XXX and up bridge on in dry share quarter for detailed achieved quarter, financial share as on Slide $XXX components values $XX reflect loan less investments repayments million working price. have million remaining interest allocation add liquidity our during of a left-hand about right over We liquidity the approximately The to X draw our definition dock just a the lead then the the These capital cash capital to and comprised $XXX less of at page. an cash million to about million and an quarter. and debt of with deposit million million. for cash in $X of ending the million million for $XXX toward bridge, to the are versus flow the million our about million, $XX XX, dividends Cash strong due balance gross million MRs $XX net capital for delivering in at sheet you of of March this in therefore to see on on timing This books expense, EBITDA $XXX market composed debt about are along flow side XX%. scheduled equates current Following nearly XX% cost our which we

]million points Our to on X% which about equating the interest so. basis average we debt facility, an the rate or extended [ as of $XXX amended all-in $XXX fixed million of than weighted XX today debt In bottom April slide, right is call XX% therefore, the XXX the hedged less of our the to RCF. above rates, our now reflect table balances

no has of debt earlier, mentioned repayments about million a Lois facility time, this at representing per this mandatory As $XX year. savings

growth to flexibility shareholders. to sheet balance continue returns create the facilitate to and the enhance We financial to necessary

million revolvers. $XXX undrawn have We in

is nearest [ the portfolio maturity ] next decade. total in Our of in the the

returns share We continue breakeven and to we costs, upside, to the shareholders. our in double-digit lower the

TCE earnings you'll about slide On TCE for reflects quarter. of may actual our per the on which our be I'll for see booked our have second our as fixtures, remind of the that also But call with cover, spot earned always and day today, starting spot fleet-wide TCE, rate, different. breakeven you, forward-looking guidance do, with XXXX, to last average date the cash aligned quarter I of slide as I'll XX, we a blended that that $XX,XXX TCE

relates for more side revenues breakeven spot This rate. to slide, than cash the our the you less per methodology second On $XX,XXX dividing that The above in the of time up lines the can is the days. using said, day half as spot right-hand TCE, against then see expenses our excess was exclusively the average spot charter I days which, how quarter. costs chartered spot vessel here and that vessels, by of our on

and the modelers out the our bottom Looking XXXX. some estimates our chart guidance for in we at for quarter on expenses updated the left-hand there, provided second

also the capex remarks. appendix, read these concludes I for modeling That to XXXX. my want We line, items them to purposes. in but by included don't schedule and quarterly you off-hire encourage our I use plan expected for line to

call like for comments. the now turn I'd closing So to Lois to back her

Lois Zabrocky

much, a to while our investment of Slide last Jeff. In very company. track highlights. X you Thank XX record sheet, has brief, details growing shareholders, Seaways balance a returning healthy built maintaining International years, over the the

XX% is return shareholder return. total a annual inception, representing XXX% compounded our since Our over

represent a Over months, the of XX dividend last $X.XX our combined XX% yield.

all have are and XX paid have strong eco gains million X vessel. niche building of MRs X in on This International upgrade debt. older joint taken is $XXX to of We improving These quietly venture. unencumbered the MRs. for our sheet. sales continue than MRs we balance our for advantage Panamax by We our strong what LRXs vessels now higher under our purchasing We've and that selling some the balances fleet, while

undrawn in opportunistically our will We have balanced $XXX utilize which to grow fleet. million capacity, we credit carefully

value we'd for with creating will expect spot like to our months. open this to shareholders. our continue the work cash the importantly, that earn to ships that questions. in the And cycle, need Jen, forward much. $XX,XXX even said, we very day for lines balanced in the XX you fleet generating company break point and Finally, of per to for Thank up put most we below now At

Operator

Thank you.

We line with question Jefferies. question-and-answer Instructions] Our session. comes will now begin first the [Operator Omar of the from Nokta

Omar Nokta

up are habitually you're because underway, well the XQ, I calls. -- dirty in about with about and now. Is at it's a know But that strong here advance global to LRXs, X ask trade newbuilding to there feel again added the performance whether in on to planned I quarter that's we to this in and going question averages, America, I niche moment? that the in why all apologize this first the I'm of again in very clean delivery? of asking above here we're your Panamax in or then it's kind And like mid-XXs the on the be LRXs. a I'm also deployed Panamaxes you've LRX seasonal on seeing into which tally, element just strong those a ships thinking Are performance market into terms South side

Lois Zabrocky

the in the that Omar, performance thank midsized you sector. I first quarter, very the saw the for that a across say on strong performance compliment sector. again would on you

the and sort really time You're have spot now market, lift first little themselves seeing of, [indiscernible], years. couple in assert time of for in a kind the the a first of off for the

And And in be think out I the see TMX as on trade more far the market, as the their are is the probably quite add the the add into generally building tanker those coming as you -- seasonality look the also quarter for will mostly, know, to that customer trades. of even trading the a first is to base in the Americas Vancouver which joint LRXs, the venture. barrels Panamaxes on that quarter additional to niche LRXs, the but strong forward that well. particular So, to pipeline in as you and base and intention we the to with of Aframaxes of

at the If a it space, trade. growth you LRX big look is not

base of is strong that old. there. age very the profile sector it's quite However, customer And a

Omar Nokta

to see Aframaxes loaded, you so -- that of a of potential be about, has fully that. LRXs what the on some perhaps Panamaxes the seem discussion TMX start like or the won't So, at been but kind lot you're they talking may of capture least Aframaxes,

Lois Zabrocky

how to West we're exported go Asia. have to Well, barrels how to get emerges, Coast, as see going trade that down here the many to many

there For ]. largest size load at it's the increased arena. you first the can that sure, is overall, the in that [ Aframax directly But volumes

Omar Nokta

then a And follow-up. just

obviously ]. You've adding and charter been more [ recovery more

you added loan in [ on You What couple of LRX a thinking more you sounds add do? please? the ships it like then particular built lot you color still MRs. are like of that a segment cover exposure, away to wanted. in put terms more continue ] is have have and to here predominantly you spot any you you'd but yes, added XX cover? on -- to a if Is there's there something opportunities the And want you charge Clearly, the to there,

Lois Zabrocky

to the charter of start I'm question. our around and to moment. the complete Chief fleet the at going Derek that, on have going Commercial XX% Officer, I'm then time And we have

lock then So, we maintain outsized level towards a certainly at this those longer to a period, a to X operating returns, very can a when And years for somewhere And see we in, more market. we opportunities. outsized Derek? leverage significant returns year, strong tend seek than we that heading high

Derek Solon

on been able and recently sort of XX-plus the X of value MRs years. Lois. piggyback for we've the on to Thanks, just crystallize X say to years some Lois I'll

been of for we've value as Like for sort to XX-plus happy you lone and in that well. the our highlighting -- lock ships LRX So, LRX. say, the she's thanks

for low [indiscernible] any sector, specific So, not seemed putting necessarily, returns look for X move. as like But her continue to just outsized point, right to longer your for away with we'll periods. years

Operator

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

Liam Burke

Lois, customers Have there to your on as from has chartering XX it been any range? pushback but it, doesn't any your shipping into MRs? move XX-year that trouble they you older look them had like

Lois Zabrocky

really sector question, the you say, up strength sets those Thank Liam, and to if of this you for at â€“ that look rates that because Derek

Derek Solon

in for sorry, and QX. XX continuing Derek. is day that rates -- To at fleet are point, into show that we're our into trade the correction, your but to we're ships This coming in several older, spot QX $XX looking strong years quarter a at

market on not like So, freight discrimination seeing no, too ag. we're really with the at the moment, much this,

Liam Burke

with Jeff, a moving to with the policy, right -- fact coming the but the Any thought dividend comfortable up? you base accelerating. costs on cash Or seems you to comfortable the that flow cash now? it the are variable dividend your have investors $X.XX quarterly, are be your down, are very variable plus is the

Jeffrey Pribor

component $X.XX from $X.XX. Yes, fixed we moved the to

I think it was X years ago.

set something it's a It's for timetable company we'll there's time that. from of So, to I think evaluate is the thing natural time. as sort growing, but no

the a in always I it's good it's probably So, and likely. something time, that's I think we and question, think consider fullness of

Operator

the Our of line next comes from Robertson Chris Deutsche with Bank. question

Christopher Robertson

net I've I where been to structure do the whether good you my with things especially the this OpEx, something the it or now secured comes But have kind to apologize for to Jeff, it are a further? cap anything are I that voice of to or a would this like lower you we breakeven, just in further cash has breakeven with ] like we that targeting steady the she weather. as Or cash XX% consolidation advance. and capital. around it to plans been of little -- that? way? financing to seems point value, in bit at senior from of [ sit under return you lower mean, Is goes do the I there company I just forward? back mean the facilities and breakeven more the loan just cash level, guess, can here that the very place characterize it is harvest kind lowered,

Jeffrey Pribor

are what reducing I have they been cash today. to to the that Chris, on able we're pleased think we've breakevens achieve where we

teens hard and to only doesn't years couple getting it are the we amortize require together, of range, debt, aiming it any the us produces new the where lower, cash debt a or a in enables fixed market. -- well not place like levels these but works to kind market, that but amortization. us value at ago as it's as we're I transform below was more choose think and a do debt had remember or that's we're for even terrible middle recycle facility may We things revolvers switch to like where getting up breakevens all a we zero of to but heading term it's which puts

that low well a even your such having in of market So you our breakeven is still objectives. do one would

happy really about that. we're So,

for do debt it of and of we'll to earning kind rates I the a don't So of with think year is It's below look a even interest that like little while. and say, debt, next high-quality some place of not yes, this always in it, have is ways others But we'd in naturally for the to I now, changes major so. better. we see the or

I way to company. do opportunities to not use I know, pretty sitting a and And flow use to long would think the cash saying, characterize the talked to renew addition found find it returns Chris, extensively. So, that some we're about fleet. back. fleet flow -- don't I you seen We in have think I to opportunities we've Lois shareholders, guess grow the the don't of cash the good

So, I we're also grow. looking selectively harvesting, think to we are but

Christopher Robertson

as for Thank Jeff, clarifying you, well. categorization that

point? of dated, the potential today? recent that at to sale. of efforts we a just had Or MRs second-hand of bit portion assets market renewal forward the some like sales are other the looking fleet be Speaking kind Should MR and what's that of the you've still little the at looking this looking

Lois Zabrocky

strong, in strong, these putting historically very XX in Chris, market time day the the very of quarter, charters rates. X So, booked strong X, second and very far quarter strong, first second-hand a is thus multiyear on

We carefully will a market. this because in do it and balance strong selectively it's we prune very

Christopher Robertson

sales, used acquisitions turn or vessel that potential efforts on on ordering? be the then from even renewal further some And for any would Lois, maybe proceeds in

Lois Zabrocky

it we to how does and be way, specifically how to to execute bucket we don't look fleet. but it tend high-grade the We exactly that continue

Jeffrey Pribor

and vessels profit. think a from all I I'd to older allocated. from significant get Yes, cash get you say at be flow cash It cash free flow you operations monetizing free becomes

Operator

Thank with line you. Elmaghrabi [Operator Instructions] the BTIG. from next of Sherif Our comes question

Sherif Elmaghrabi

at a delivery open would first, to early their you similar many delivered? today newbuilds is. a be before if So, XXXX go given exist pretty these yards? insight LRX delivery and I'm unique have And are any were to when do how opportunity order how tanker, or for And yard may curious, slots into that you

Lois Zabrocky

little bit it I'm a I'll our going try that, well, man. commercial Derek to as of to give and

we us has this strong obviously, So knew -- a time. some been yes, sector for for

those So, of on we Most space, take into get color XXXX, we really them. maybe you the little some across wanted give advantage today And Derek, Or... to slots can slots MRs in XXXX. as tanker a you more found would kind are of that?

Derek Solon

these in to Lois. I XXXX. on to And there are XX.X-meter Canal only highlight old first yards, what being is Panamax our the said being the beam. -- LRXs color really for that is, built of other built specifically, to what trying us, while Sure, are could other will The said, then add be Lois available Lois most there LRXs we're still LRXs at like

XX-meter new that's sides being the trade will our the most while and Pacific So LRXs Canal, to the are Atlantic. the of these [ on for the beam. do of both is go earnings through of able been build around new reason part buildings same, ] And strong the

can't clean trade in on and crude us the So for with really the Americas. that built compete really trade

Operator

registered this questions no time. at There are

the over any pass to closing will back I CEO, Zabrocky Lois call So, remarks. for

Lois Zabrocky

talk call everyone quarter want Thank you and International Seaways, earnings to soon. we'll you. to for at first thank us joining just our for I

Operator

for call. Thank your concludes today's participation. That you

disconnect now may You line. your

International Seaways (INSW) 8 May 242024 Q1 Earnings call transcript