- Ninefold increase of net income from Q1 2022
- 6mo net income of $51.7 million
- 6mo EBITDA $133.3 million
- 50% increase in common stock dividend from July 2022
- Half a billion dollars distribution since 2002 NYSE listing
- Long-term market fundamentals remain strong
Today, the results (unaudited) for the six months and second quarter ended June 30, 2022, were released by TEN, Ltd (TEN) (NYSE: TNP) (the “Company”).
Six months 2022 summary results
As global oil demand seems to be recovering from the Covid-19 pandemic, the severe and largely unexpected geopolitical events that unfolded in the year’s first quarter led to dislocations in global trading patterns that boosted all regional and international tanker trades and created a long-term energy shift.
Operating income reached $67 million, a seven-fold improvement.
This resulted in a net income of $51.7 million, an increase of 311% from the 2021 first half.
Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) for the first six months of 2022 was at $133.3 million, double the 2021 first-half period, reflecting favourable market conditions.
Average daily operating expenses per vessel were very competitive at $8,056, not much higher than the 2021 first-half levels.
G&A expenses fell by 2.0% compared to the first half of 2021.
Net debt to the capital on June 30, 2022, was 48.8%, while our overall cost of debt remained very competitive at 2.5%, reflecting the quality of the fleet and the Company’s long-standing track record in the tanker and debt markets.
From the peak of 2016, the Company has reduced its debt by close to $450 million in addition to $100 million of preferred shares redemptions.
Finance costs in the first six months of 2022 fell by 2.0%, due to the reduction in outstanding loans and benefits resulting from the bunker hedges.
Cash and cash equivalent levels, despite new building instalments in addition to loan repayments during the first six months of 2022, stood at a healthy $172 million.
Q2 2022 summary results
TEN being a beneficiary of the new trading patterns that developed in the second quarter of 2022, generated voyage revenues of $217 million, $80.3 million higher than the equivalent 2021 period.
Adjusted EBITDA for the second quarter of 2022 reached $91.1 million, a threefold increase from the 2021 equivalent quarter.
Fleet utilization, despite several scheduled dry-dockings, remained high at 93.6%.
Our spot vessels, benefitting from the aforementioned factors, added $119.5 million in gross revenues.
On a daily average per vessel basis, operating expenses for the 2022 second quarter were at $8,367, while G&A expenses fell by 3.0% from the same 2021 quarter.
Dividend – common shares
The Company will make a new distribution of $0.15 per common share in December 2022, continuing the uninterrupted payments of common stock dividends. According to the TEN’s semi-annual dividend policy, this constitutes the second payment for 2022 and represents a 50% increase over the previous base of $0.10 paid in July 2022. Since its 2002 NYSE debut, TEN has paid common stockholders $500 million in dividends, or around $25 million annually, not counting this future distribution.
Through its ATM programme, the company issued 460,569 common shares in the second quarter of 2022, generating $4.8 million.
A 2020-built scrubber with a VLCC that was manufactured in South Korea was purchased by TEN in June 2022; the scrubber will be delivered to the company by November 2022.
The DP2 Shuttle Tanker Porto was delivered to the company in July 2022 with up to 11 years of employment to a significant end-user, following the punctual delivery of the LNG Tenergy in January 2021. Throughout its minimum life, this fixture’s gross earnings should approach $80 million.
The Company sold the 2003-built Panamax tanker Inca to other parties in August 2022. After paying down associated debt, TEN received $8.5 million in free cash from this sale.
Corporate strategy & outlook
The robust market due to the end of the global pandemic and the record low orderbook levels were coming, as we had foreseen in our most recent statements. Geopolitical developments and international sanctions, on the other hand, have risen rates past our projection and are anticipated to continue for the foreseeable future. With the strength seen in product carriers recently, it has also positively affected the crude carrier industry.
With its timely acquisition and green ship push, TEN has laid the groundwork for capitalising on the dynamic energy landscape.
“With a strong balance sheet and stable market conditions, TEN will keep looking for ways to expand its market share in the niche markets in which it operates, such as shuttle tankers, LNG, and dual-fuel vessels, to further increase shareholder value. Along with maintaining the Company’s cash reserves and adhering to management’s cautious growth objectives, the reduction of bank debt will continue,” declared TEN COO George Saroglou.
10:00 a.m. on September 14, 2022, on Wednesday. TEN will hold a conference call to discuss the findings and the direction of the company’s management at 8 a.m. Eastern Time. The senior management of TEN will host the call, which can include material not mentioned in the earnings news release.
Participants should dial into the call at 877-405-1226 (US Dial-In) or +1 201-689-7823 10 minutes before the appointed time (US International Dial-In). Please tell the operator “Tsakos” or the call ID number  to join the conference call. To reach new participants internationally, click here.
Simultaneous Slides and Audio Webcast:
The conference call and accompanying slides will also be broadcast live and then archived on the company website. Visit our website at www.tenn.gr and select Webcasts & Presentations from the Investor Relations section to access the archived audio file. Before the live webcast begins, participants should register on the website. This should be done around 10 minutes in advance.
One of the first and oldest public shipping firms in the world, TEN was created in 1993 and is marking 29 years as a public company this year. The current TEN diversified energy fleet includes 70 double-hull vessels, including four dual-fuel LNG-powered Aframax vessels that are currently under construction and a 2020-built scrubber-equipped South Korean-built VLCC that will be delivered in the fourth quarter of 2022. These vessels are a mixture of crude tankers, product tankers, and LNG carriers, with a combined weight of 8.1 million dwt.
TEN’s current growth program
|1||ZEUS||VLCC-Scrubber||Q4 2022||To Be Delivered||TBA|
|2||TBN||Aframax Dual Fuel||Q3 2023*||Under Construction||Yes|
|3||TBN||Aframax Dual Fuel||Q4 2023*||Under Construction||Yes|
|4||TBN||Aframax Dual Fuel||Q4 2023*||Under Construction||Yes|
|5||TBN||Aframax Dual Fuel||Q4 2023*||Under Construction||Yes|
*Expected delivery as per shipbuilding contracts
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Source: Yahoo Finance