TEN, Ltd (TEN) (NYSE: TNP) (the “Company”) today reported results
(unaudited) for the quarter ended March 31, 2020.
Q1 2020 Summary ResultsGross
revenues for the first quarter of 2020 came at approximately $180
million, $32 million higher than in the 2019 first quarter.
Operating income doubled to $54.7 million from
$27.8 million in the 2019 first quarter.
Net income, exclusive of a non-cash bunker hedge
effect, increased 250% to $39.3 million, and to a solid $21.2
million after taking into account the impact of non-cash items.
Earnings per share, after non-cash bunker hedges and preferred
stock dividends, increased to $0.12 in the first quarter of 2020
from $0.01 in the first quarter of 2019.
EBITDA amounted to about $90 million, 40% higher
than in the 2019 first quarter.
The daily average TCE per vessel reached $26,629
compared to $21,054 in the first quarter of 2019.
This performance was a reflection of the strong
market that started in the latter months of 2019 and continued into
the first and second quarter of 2020. As a result, TEN once again
benefited by chartering its vessels on long-term contracts hence
securing future earnings and allowing the fleet to achieve a high
fleet utilization, reaching 97% with only one vessel undergoing
scheduled dry docking.
Fleet operating expenses increased modestly to
$45.5 million from $43.3 million in the first quarter of 2019,
partly due to the size of the fleet and calculated increases in
provisions and stores taken onboard vessels for precautionary
reasons as the Covid-19 pandemic began to spread, threatening
access to terminals.
On a daily average per vessel basis, operating
expenses were once again controlled to about $7,900 due to strict
cost checks.
G&A expenses increased by $1.17 million
mainly due to a slightly higher fleet from the first quarter of
2019.
Depreciation and amortization combined were
about $0.5 million lower than in the 2019 first quarter due to
vessel sales.
In the first quarter of 2020, interest and
finance costs reached $33.6 million which included hedge related
payments and $16.0 million non-cash negative changes in bunker
valuations. These non-cash items have already reversed due to the
rebalancing of the oil market in terms of oil production and
expected to have a positive impact on the balance sheet going
forward.
Actual bank loan interest payments fell by $4.4
million due to lower interest rates and declining outstanding loans
from scheduled repayments and vessel sales.
By the end of the 2020 first quarter, total
outstanding indebtedness fell by a net $53.5 million and
correspondingly TEN’s net debt to capital declined to 46.5%.
Concurrently, TEN’s cash balances reached a level well beyond
earlier expectations, with cash reserves at a healthy $221
million.
In January 2020, TEN took delivery of the
newbuilding aframax Caribbean Voyager which immediately commenced
its five-year bareboat employment to a US oil major, sistership to
the Mediterranean Voyager delivered in October 2019 to the same
charterer for identical employment.
Dividend – Common
SharesFollowing the March 24, 2020 announcement of a 5
cents per common share dividend, the Company’s Board of Directors
have subsequently approved to increase, for this time, that amount
by 50% and pay a total of 7.5 cents per common share on June 26,
2020. The record date has been set for June 22, 2020 with
ex-dividend date June 19, 2020.
Corporate Strategy & OutlookThe primary
objective of management since the beginning of the year has been to
ensure that the fleet’s crew is safe and sound in these challenging
times, especially as government actions around the world have
applied harsh, but necessary restrictions to contain the Covid-19
pandemic.
In this unprecedented environment, with 65
vessels navigating all corners of the world and crewed by 2,000
seafarers, management’s goal has been to ensure their health and
safety. We are proud to have safeguarded our employees to the best
of our ability, so far.
During this period, the silver lining has been
the strength of the tanker market, due to its solid fundamentals
and the strong demand for our services during the first six months
of 2020. In this environment, TEN took the opportunity to agree
long-term accretive charters, that will secure the Company’s
positive performance for the remainder of 2020.
Maintaining a strong balance sheet by increasing
liquidity and reducing debt obligations continues to be a priority.
As previously stated, it remains management’s intention to initiate
the, at par, redemption of its Series C preferred shares next
quarter.
“In the first quarter of 2020, the pandemic was
accompanied by a strong tanker market that continued well into the
second quarter. During that period, TEN fixed long-term charters
for its vessels that will secure positive returns for the remainder
of the year and beyond,” Mr. George Saroglou, COO of TEN commented.
“Management continues to be in discussions with first-class
charterers for similar accretive employments to safeguard cash flow
visibility, a core element in TEN’s strategy. The safety of our
seafarers was, is and remains our top priority as TEN continues its
long established and market tested operating model to achieve the
highest utilization levels and long-term profitability. This is the
fourth and most challenging crisis we have successfully navigated
in 28 years of operations. We would like to thank all our
colleagues for their efforts during these extraordinary times and
wish them to remain safe and healthy,” Mr. Saroglou concluded.
Reverse Share Split At the
Company’s Annual General Meeting which was held on May 28, 2020 it
was resolved by shareholders to undertake a one-for-five reverse
split of our common shares by which one new common share will be
given in exchange for every five currently held. This is scheduled
to take effect at the opening of trading on July 1st, 2020 and
management expects this to increase the universe of investors with
the ability to invest in TEN. Further details will be provided in a
Press Release on this topic.
Conference Call
details:Participants should dial into the call 10
minutes before the scheduled time using the following numbers: +1
(844) 824-7423 (US Toll Free Dial In), +1 (918) 922-6416 (Standard
International Dial In) or +44 (0) 8000 288 438 (UK Toll Free Dial
In). Please quote "Tsakos" to the operator.
A telephonic replay of the conference call will
be available until Thursday, June 18, 2020 by dialing +1(855)
859-2056 (US Toll Free Dial In), or (800) 585-8367 (Standard
International Dial In). Access Code:
3680608#
Simultaneous Slides and Audio
Webcast:There will also be a simultaneous live,
and then archived, slides webcast of the conference call, available
through TEN's website (www.tenn.gr). The slides webcast will also
provide details related to fleet composition and deployment and
other related company information. This presentation will be
available on the Company's corporate website reception page at
www.tenn.gr. Participants for the live webcast should register on
the website approximately 10 minutes prior to the start of the
webcast.
ABOUT TENTEN, founded in 1993
and celebrating this year 27 years as a public company, is one of
the first and most established public shipping companies in the
world. TEN’s diversified energy fleet currently consists of 69
double-hull vessels, including two suezmax tankers and one LNG
carrier under construction, constituting a mix of crude tankers,
product tankers and LNG carriers, totalling 7.6 million dwt. Of the
proforma fleet today, 48 vessels trade in crude, 15 in products,
three are shuttle tankers and three are LNG carriers.
TEN’s Growth Program
|
# |
Name |
Type |
Delivery |
Built |
Financed |
Employment |
|
1 |
HN8041 |
Suezmax |
2020 |
South Korea |
Yes |
Yes |
|
2 |
HN8042 |
Suezmax |
2020 |
South Korea |
Yes |
Yes |
|
3 |
HN3157 |
LNG |
2021 |
South Korea |
TBD |
TBD |
ABOUT FORWARD-LOOKING
STATEMENTS Except for the historical information contained
herein, the matters discussed in this press release are
forward-looking statements that involve risks and uncertainties
that could cause actual results to differ materially from those
predicted by such forward-looking statements. TEN undertakes no
obligation to publicly update any forward-looking statement,
whether as a result of new information, future events, or
otherwise.
For further information please contact:
CompanyTsakos Energy Navigation
Ltd.George SaroglouCOO+30210 94 07 710gsaroglou@tenn.gr
Investor Relations /
MediaCapital Link, Inc.Nicolas BornozisMarkella Kara+212
661 7566 ten@capitallink.com
|
|
|
TSAKOS ENERGY NAVIGATION LIMITED AND
SUBSIDIARIES |
|
Selected Consolidated Financial and Other Data |
|
(In Thousands of U.S. Dollars, except share, per share and fleet
data) |
|
|
|
|
|
|
|
|
| |
|
Three months ended |
| |
|
March 31 (unaudited) |
|
STATEMENT OF OPERATIONS DATA |
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
Voyage revenues |
$ |
178,899 |
|
|
|
$ |
147,046 |
|
| |
|
|
|
|
|
|
|
Voyage expenses |
|
32,711 |
|
|
|
|
31,566 |
|
|
Charter hire expense |
|
5,140 |
|
|
|
|
2,669 |
|
|
Vessel operating expenses |
|
45,488 |
|
|
|
|
43,324 |
|
|
Depreciation and amortization |
|
34,828 |
|
|
|
|
35,285 |
|
|
General and administrative expenses |
|
7,603 |
|
|
|
|
6,436 |
|
|
Gain on sale of vessel |
|
(1,638 |
) |
|
|
|
- |
|
|
Total expenses |
|
124,132 |
|
|
|
|
119,280 |
|
|
|
|
|
|
|
|
|
|
Operating income |
|
54,767 |
|
|
|
|
27,766 |
|
|
|
|
|
|
|
|
|
|
Interest and finance costs, net |
|
(33,593 |
) |
|
|
|
(17,593 |
) |
|
Interest income |
|
391 |
|
|
|
|
774 |
|
|
Other, net |
|
408 |
|
|
|
|
(29 |
) |
|
Total other expenses, net |
|
(32,794 |
) |
|
|
|
(16,848 |
) |
|
Net income |
|
21,973 |
|
|
|
|
10,918 |
|
|
|
|
|
|
|
|
|
|
Less: Net (income) loss attributable to the noncontrolling
interest |
|
(752 |
) |
|
|
|
311 |
|
|
Net income attributable to Tsakos Energy Navigation
Limited |
$ |
21,221 |
|
|
|
$ |
11,229 |
|
|
|
|
|
|
|
|
|
|
Effect of preferred dividends |
|
(10,207 |
) |
|
|
|
(10,204 |
) |
|
Net income attributable to common stockholders of Tsakos
Energy Navigation Limited |
$ |
11,014 |
|
|
|
$ |
1,025 |
|
|
|
|
|
|
|
|
|
|
Earnings per share, basic and diluted |
$ |
0.12 |
|
|
|
$ |
0.01 |
|
| |
|
|
|
|
|
|
|
Weighted average number of common shares, basic and diluted |
|
95,613,804 |
|
|
|
|
87,604,645 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE SHEET DATA |
|
March 31 |
|
|
|
December 31 |
|
|
|
2020 |
|
|
|
2019 |
|
Cash |
|
220,851 |
|
|
|
|
197,770 |
|
|
Other assets |
|
234,029 |
|
|
|
|
261,607 |
|
|
Vessels, net |
|
2,655,529 |
|
|
|
|
2,633,251 |
|
|
Advances for vessels under construction |
|
49,200 |
|
|
|
|
61,475 |
|
|
Total assets |
$ |
3,159,609 |
|
|
|
$ |
3,154,103 |
|
| |
|
|
|
|
|
|
|
Debt, net of deferred finance costs |
|
1,481,080 |
|
|
|
|
1,534,296 |
|
|
Other liabilities |
|
214,520 |
|
|
|
|
147,488 |
|
|
Stockholders' equity |
|
1,464,009 |
|
|
|
|
1,472,319 |
|
|
Total liabilities and stockholders' equity |
$ |
3,159,609 |
|
|
|
$ |
3,154,103 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
| |
|
Three months ended |
|
OTHER FINANCIAL DATA |
|
March 31 |
|
|
|
2020 |
|
|
|
2019 |
|
Net cash from operating activities |
$ |
57,453 |
|
|
|
$ |
39,238 |
|
|
Net cash provided by (used in) investing activities |
$ |
22,546 |
|
|
|
$ |
(20,830 |
) |
|
Net cash used in financing activities |
$ |
(56,918 |
) |
|
|
$ |
(47,179 |
) |
| |
|
|
|
|
|
|
|
TCE per ship per day |
$ |
26,629 |
|
|
|
$ |
21,054 |
|
| |
|
|
|
|
|
|
|
Operating expenses per ship per day |
$ |
7,886 |
|
|
|
$ |
7,522 |
|
|
Vessel overhead costs per ship per day |
$ |
1,279 |
|
|
|
$ |
1,117 |
|
| |
|
9,165 |
|
|
|
|
8,639 |
|
| |
|
|
|
|
|
|
|
FLEET DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of vessels during period |
|
65.3 |
|
|
|
|
64.0 |
|
|
Number of vessels at end of period |
|
65.0 |
|
|
|
|
64.0 |
|
|
Average age of fleet at end of period |
Years |
9.0 |
|
|
|
|
8.5 |
|
|
Dwt at end of period (in thousands) |
|
6,998 |
|
|
|
|
6,936 |
|
|
|
|
|
|
|
|
|
|
Time charter employment - fixed rate |
Days |
2,511 |
|
|
|
|
2,393 |
|
|
Time charter employment - variable rate |
Days |
1,735 |
|
|
|
|
1,674 |
|
|
Period employment (coa) at market rates |
Days |
89 |
|
|
|
|
180 |
|
|
Spot voyage employment at market rates |
Days |
1,421 |
|
|
|
|
1,328 |
|
|
Total operating days |
|
5,756 |
|
|
|
|
5,575 |
|
|
Total available days |
|
5,943 |
|
|
|
|
5,760 |
|
|
Utilization |
|
96.9% |
|
|
|
|
96.8% |
|
| |
|
|
|
|
|
|
|
Non-GAAP Measures |
|
Reconciliation of Net income to Adjusted
EBITDA |
|
|
|
Three months ended |
|
|
|
March 31 |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
Net income attributable to Tsakos Energy Navigation Limited |
|
21,221 |
|
|
|
|
11,229 |
|
|
Depreciation and amortization |
|
34,828 |
|
|
|
|
35,285 |
|
|
Interest Expense |
|
33,593 |
|
|
|
|
17,593 |
|
|
Gain on sale of vessel |
|
(1,638 |
) |
|
|
|
- |
|
|
Adjusted EBITDA |
$ |
88,004 |
|
|
|
$ |
64,107 |
|
| |
|
|
|
|
|
|
|
The Company reports its financial results in accordance with U.S.
generally accepted accounting principles (GAAP). However,
management believes that certain non-GAAP measures used within the
financial community may provide users of this financial information
additional meaningful comparisons between current results and
results in prior operating periods as well as comparisons between
the performance of Shipping Companies. Management also uses these
non-GAAP financial measures in making financial, operating and
planning decisions and in evaluating the Company’s performance. We
are using the following Non-GAAP measures: |
|
|
|
(i) TCE which represents voyage revenue less voyage expenses is
divided by the number of operating days less 200 days lost for the
first quarter of 2020 and 90 days for the prior year quarter of
2019 as a result of calculating revenue on a loading to discharge
basis. |
|
(ii) Vessel overhead costs are General & Administrative
expenses, which also include Management fees, Stock compensation
expense and Management incentive award. |
|
(iii) Operating expenses per ship per day which exclude Management
fees, General & Administrative expenses, Stock compensation
expense and Management incentive award. |
|
(iv) EBITDA. See above for reconciliation to net income. |
|
Non-GAAP financial measures should be viewed in addition to and not
as an alternative for, the Company’s reported results prepared in
accordance with GAAP. |
|
The Company does not incur corporation tax. |
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