TEN Ltd Reports First Quarter 2017 Profits And Declares Dividend
$17.5 million net income for Q1 2017 or $0.16 earnings per share; 77% of Fleet on Long-Term Employment; $1.4 billion in minimum contracted future revenues
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ATHENS, GREECE -- (Marketwired) -- 05/12/17 -- TEN, Ltd (NYSE: TNP)
RECENT HIGHLIGHTS
- Net income of $17.5 million or $0.16 per share.
- EBITDA of $61.6 million.
- 77% of total fleet on long-term charters with minimum revenues of $1.4 billion and average charter employment of 2.5 years.
- Maintaining outstanding fleet utilization at 97.2%.
- 4% reduction in vessel daily operating expenses.
- All 15 newbuildings on long-term contracts. Twelve vessels already delivered, three in the next three quarters.
- Pro-forma fleet of 65 vessels, totaling 7.2 million dwt, consisting of 45 tankers that trade in the crude space, three shuttle tankers, 15 tankers carrying products and two LNG vessels.
- Uninterrupted dividend distributions since inception. New dividend of $0.05 per common share declared for payment on July 14, 2017.
TEN, Ltd (TEN) (NYSE: TNP) (the "Company") today reported results (unaudited) for the quarter ended March 31, 2017.
Q1 2017 Summary Results Revenues, net of voyage expenses totaled $108.2 million, approximately $8.5 million more than in the first quarter of 2016, in part due to the delivery of new vessels.
Net income in the first quarter 2017 was $17.5 million, or $0.16 per share, net of preferred dividends.
Fleet utilization of 97.2% contributed to higher revenue. TEN has maintained a 95% plus utilization consistently. A remarkable accomplishment in a cyclical industry.
Since the beginning of 2017, TEN has taken delivery of four vessels, namely the VLCC Hercules I in January, the aframax crude carriers Marathon TS and Sola TS in February and April respectively, and its third shuttle tanker, the DP2 Lisboa in March, which started its time-charter in May, 2017.
Depreciation and dry-docking amortization costs increased by $6.1 million due to the introduction of new vessels into the fleet. No vessels were disposed of during the period, although there remains an expectation to sell certain older, for TEN's standards, vessels during the course of the year.
Average daily operating costs per vessel decreased by 4% to $7,584 from $7,890 in the first quarter of 2016, mainly as a result of cost effective operations by our affiliated technical managers.
TEN's daily average overhead expense per vessel was reduced by 5% to $1,139. G&A fell 12% from the first quarter 2016, mainly due to reduced promotional and miscellaneous expenses.
Interest and finance costs totaled $11.9 million, an increase over the first quarter of 2016 mainly due to reduced capitalized interest upon the completion of new vessels, increased indebtedness due to those new vessels and increases in the LIBOR rate, offset partly by gains on interest rate swaps.
Cash balances amounted to $160.1 million as of March 31, 2017. TEN's balance sheet has been further strengthened with $115.0 million gross proceeds from an offering of preferred shares which closed in April.
Net debt to capital at March 31, 2017 was 54%. Earnings before interest, depreciation and amortization (EBITDA) in the first quarter of 2017 amounted to $61.6 million. All vessels generated a positive EBITDA, except for two vessels undergoing dry-docking in the period.
"TEN posted another profitable quarter in a challenging market environment. This is the best proof of management's performance in executing a clearly defined strategy that takes into account the numerous and very complex parameters at play. Prudence and early preemptive action, together with ever increasing efficiency in managing costs, allows TEN to produce steady sustainable earnings and best in class results," Mr. Takis Arapoglou, Chairman of the Board stated. "This has been a steady pattern throughout the 24 years since TEN's inception, allowing it to navigate effectively and efficiently through all business cycles, to consistently reward its shareholders, while adhering to strict corporate governance guidelines and adapting to evolving regulatory environments. Today, TEN has a fleet of 65 modern vessels, covering the whole spectrum from conventional crude and product tankers to higher value added DP shuttle tankers and LNG carriers. This unique fleet profile reflects TEN's strategy to offer one platform serving all the needs of its prestigious client base. This new industrial model ensures stability, sustainable earnings and continued value creation for the shareholders," Mr. Arapoglou concluded.
Dividend - Common Shares The Company will pay a dividend of $0.05 per common share on July 14, 2017 to shareholders of record as of July 11, 2017. Inclusive of this payment, TEN will have distributed a total of $10.51 per share in uninterrupted dividends to its common shareholders since the Company's listing on the NYSE in March 2002.
Strategy & Outlook As expected, oil barrels from Nigeria, Libya, Iran and the rejuvenation of the US shale industry is filling the void the OPEC (and non-OPEC) cuts have created in the markets. As a result, oil prices continue to remain at attractive levels to stimulate global demand and by extension seaborne tanker trade. With oil prices at attractive levels and a low orderbook environment, we expect a long term upward momentum in freight rates. TEN, with the majority of the fleet in secured and flexible contracts and a notable presence in the spot market, would be a prime beneficiary of this expected uplift.
In line with the programmed deliveries, in January 2017 the VLCC Hercules I was delivered from Hyundai Heavy Industries in South Korea and was subsequently chartered for a period of up to 18 months. In February and April 2017, the aframax tankers Marathon TS and Sola TS were delivered from Daewoo Mangalia Heavy Industries, the fifth and sixth in a series of nine aframaxes built against long-term contracts. In March 2017, the Company took delivery of its third DP2 shuttle tanker Lisboa from Sungdong Shipbuilding in South Korea. The vessel was built against an eight year contract, with an option to extend to eleven years. In addition, the Company recently initiated a strategic partnership with a major US oil company starting with the chartering of three suezmaxes and one VLCC.
TEN's 15-vessel newbuilding program is nearing completion with the final three aframax tankers expected to be delivered in the coming months. In the second half of the year, with all vessels delivered and 77% of the fleet on full utilization contracts, TEN's industrial shipping strategy will be at full throttle.
Conference Call: As previously announced, today, Friday, May 12, 2017 at 10:00 a.m. Eastern Time, TEN will host a conference call to review the results as well as management's outlook for the business. The call, which will be hosted by TEN's senior management, may contain information beyond that which is included in the earnings press release.
Conference Call details: Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 866 819 7111 (US Toll Free Dial In), 0800 953 0329 (UK Toll Free Dial In) or +44 (0)1452 542 301 (Standard International Dial In). Please quote "Tsakos" to the operator.
A telephonic replay of the conference call will be available until Friday, May 19, 2017 by dialling 1 866 247 4222 (US Toll Free Dial In), 0800 953 1533 (UK Toll Free Dial In) or +44 (0)1452 550 000 (Standard International Dial In). Access Code: 90295809#
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 TSAKOS ENERGY NAVIGATION TEN, founded in 1993, is one of the first and most established public shipping companies in the world today. TEN's pro-forma fleet, including three Aframax tankers under construction, consists of 65 double-hull vessels, constituting a mix of crude tankers, product tankers and LNG carriers, totalling 7.2 million dwt. Of these, 45 vessels trade in crude, 15 in products, three are shuttle tankers and two are LNG carriers.
COMPANY'S GROWTH TIME-TABLE
----------------------------------------------------------------------------
# Vessel Name Type Dwt Delivery Status LT Contracts
----------------------------------------------------------------------------
1 Ulysses VLCC 300,000 May 2016 Delivered Yes
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2 Elias Tsakos Aframax 112,700 June 2016 Delivered Yes
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3 Thomas Zafiras Aframax 112,700 Aug 2016 Delivered Yes
----------------------------------------------------------------------------
4 Leontios H Aframax 112,700 Oct 2016 Delivered Yes
----------------------------------------------------------------------------
5 Parthenon TS Aframax 112,700 Nov 2016 Delivered Yes
----------------------------------------------------------------------------
6 Sunray Panamax LR1 74,200 Aug 2016 Delivered Yes
----------------------------------------------------------------------------
7 Sunrise Panamax LR1 74,200 Sep 2016 Delivered Yes
----------------------------------------------------------------------------
8 Maria Energy LNG 93,616 Oct 2016 Delivered Yes
----------------------------------------------------------------------------
9 Hercules I VLCC 300,000 Jan 2017 Delivered Yes
----------------------------------------------------------------------------
10 Marathon TS Aframax 112,700 Feb 2017 Delivered Yes
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11 Lisboa DP2 Shuttle 157,000 Mar 2017 Delivered Yes
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12 Sola TS Aframax 112,700 Apr 2017 Delivered Yes
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13 Oslo TS Aframax 112,700 Q2 2017 TBD Yes
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14 Stavanger TS Aframax 112,700 Q3 2017 TBD Yes
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15 Bergen TS Aframax 112,700 Q4 2017 TBD Yes
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LT: Long-Term
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, 2017
STATEMENT OF OPERATIONS DATA (Unaudited)
------------------
Voyage revenues $ 138,242
------------------
Voyage expenses 30,083
Vessel operating expenses 40,011
Depreciation and amortization 32,291
General and administrative expenses 6,110
------------------
Total expenses 108,495
------------------
------------------
Operating income 29,747
------------------
Interest and finance costs, net (11,864)
Interest income 118
Other, net (145)
------------------
Total other expenses, net (11,891)
------------------
Net Income 17,856
Less: Net income attributable to the
noncontrolling interest (377)
------------------
Net Income attributable to Tsakos Energy Navigation
Limited $ 17,479
==================
Effect of preferred dividends (3,969)
Net income attributable to common stockholders of
Tsakos Energy Navigation Limited $ 13,510
Earnings per share, basic and diluted $ 0.16
==================
Weighted average number of common shares, basic and
diluted 83,966,533
==================
----------------------------------------------------------------------------
BALANCE SHEET DATA March 31
2017
------------------
Cash 160,140
Other assets 188,325
Vessels, net 2,909,409
Advances for vessels under construction 100,222
------------------
Total assets $ 3,358,096
==================
Debt, net of deferred finance costs 1,810,317
Other liabilities 120,963
Stockholders' equity 1,426,816
------------------
Total liabilities and stockholders' equity $ 3,358,096
==================
----------------------------------------------------------------------------
Three months ended
OTHER FINANCIAL DATA March 31
2017
------------------
Net cash from operating activities $ 54,454
Net cash used in investing activities $ (146,636)
Net cash provided by financing activities $ 50,616
TCE per ship per day $ 20,917
Operating expenses per ship per day $ 7,584
Vessel overhead costs per ship per day $ 1,139
------------------
8,723
FLEET DATA
Average number of vessels during period 59.6
Number of vessels at end of period 61.0
Average age of fleet at end of period Years 7.5
Dwt at end of period (in thousands) 6,216
Time charter employment - fixed rate Days 2,055
Time charter employment - variable rate Days 1,340
Period employment (pool and coa) at market rates Days 268
Spot voyage employment at market rates Days 1,551
------------------
Total operating days 5,214
Total available days 5,364
Utilization 97.2%
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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 revenues less voyage expenses divided by the
number of operating days.
(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 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.
For further information please contact: Company Tsakos Energy Navigation Ltd. George Saroglou COO +30210 94 07 710 [email protected] Investor Relations / Media Capital Link, Inc. Nicolas Bornozis Paul Lampoutis +212 661 7566 [email protected]
Source: Tsakos Energy Navigation
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