International Seaways – Focus on Deleveraging, Dividends & ESG Highlights from the Capital Link Presentation Series
News provided byCapital Link
Jan 25, 2023, 4:05 PM ET
NEW YORK, Jan. 25, 2023 (GLOBE NEWSWIRE) -- Capital Link hosted a presentation by the senior management of International Seaways, Inc. (NYSE: INSW) on Tuesday, January 17, 2023. During the 40-minute session, Lois Zabrocky, CEO, Jeffrey Pribor, CFO, and Thomas Trovato, Head of Investor Relations, highlighted the company’s strong performance during the last year, and outlined the booming tanker market as part of Capital Link’s Company Presentation Series.
REPLAY OF THE FULL SESSION
A replay of the full session of the presentation and the extensive Q&A can be accessed at:
Highlights from the International Seaways session at the Capital Link Presentation Series include the following:
International Seaways, with a fleet of 77 vessels averaging just over 9 years, is one of the largest tanker companies in the world. Headquartered in New York City, the company provides energy transportation services for crude oil and petroleum products.
The company’s fleet, which has a total carrying capacity of 9 million DWTs, is currently made up of 13 VLCCs, including three dual-fuel newbuildings delivering in 1H 2023, 13 Suezmaxes, 4 Aframaxes, 1 LR2, 8 LR1s, and 38 MRs.
INSW had “Best Quarter” in Q4 of 2022 – Disciplined Capital Allocation
Mrs. Lois Zabrocky, CEO, stated that Q4 of 2022 was “the very best quarter that we have had” since the company listed on the NYSE in 2016.
She stated that “International Seaways has been very disciplined in allocation our capital.” “We have a track record of buying at low points in the tanker cycle… of repaying debt every quarter, without missing payments, and voluntarily chipping away at our leverage,” she continued.
Mrs. Zabrocky noted the company's consistency in paying dividends even when tanker markets were weak. She highlighted that in 2022, the company doubled its regular quarterly dividend and paid a special dividend representing nearly half of its Q3 2022 net income. Tom Trovato, Head of Investor Relations, stressed that this trend will continue, stating: “Our continuing focus will be to return cash to shareholders while also pursuing debt reduction.” Mrs. Zabrocky stressed that “We returned capital when the market was extremely poor, and we’re returning even more capital now that the market is stronger.”
The Company has bought back its shares for the past three years when it felt that its shares were undervalued.
International Seaways also highlighted its “extremely strong balance sheet,” as well as the fact that the company’s Net Loan to Asset Value is below 30%. As of September 30, 2022, the company’s gross debt is just under $1.1 billion, and its annual principal payments total $180 million each year. “So, you can see that we will be rapidly paying down our debt profile,” Mrs. Zabrocky stated. The company also eliminated its most expensive debt in 2022.
As of September 30, 2022, the company had $476 million in total liquidity. “This liquidity has continued to grow,” despite International Seaway’s large dividends given out to shareholders, Mrs. Zabrocky said.
Strong Market for Both Product and Crude Tankers
Mrs. Zabrocky noted, this is “a tanker market where both products and crude have really been far above mid-cycle earnings and have shined and continue to shine.” Momentum is currently building in the tanker market, as an already strong market will be bolstered by a rising oil demand, as well as increased ton-mile demand due to the EU embargo on Russian crude.
China’s reopening after its long “Zero-Covid” policy will also help bolster the VLCC market, Mrs. Zabrocky argued. Additionally, growth in oil production is increasing in the Americas, while demand is growing in the Far East, increasing the distance the fuel will be transported, and therefore increasing the utilization of the tanker fleet.
Supply of tankers will also be restricted, as the average age of the global fleet is increasing and will soon be rendered uncompetitive in the market, and the tanker orderbook is currently very low. This, coupled with a growing demand, is a positive indicator for a strong tanker market going forward.
Leading ESG footprint
Mrs. Zabrocky stressed that ESG is one of the most fundamental issues for International Seaways.
In Q1 and Q2 of 2023, three newbuild VLCCs will be delivered to the company. These dual-fuel vessels are 40% more efficient compared to 10-year-old tankers.
International Seaways was the first in the US company to link sustainability to its senior debt facility in 2020. In 2022, the company enhanced their sustainability linked features to include incentives on green spending and safety metrics.
Additionally, Seafarer safety and wellbeing is considered the company’s top priority.
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Capital Link is hosting a series of online Corporate Presentations, whereby the Senior Management teams of leading listed maritime companies present their business development, strategy, growth prospects, and overall sector outlook. The presentations are approximately 45 minutes and consist of a company presentation followed by live Q&A between company management and webinar participants. All presentations in the series can be accessed at https://webinars.capitallink.com/2023/company_presentation/.
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