Scorpio Tankers Inc. · NYSE:STNG
Scorpio Tankers — Q1 2022 Earnings Presentation
25 slides from Scorpio Tankers's earnings presentation, Apr 28, 2022
Slide 1: Scorpio Tankers Inc. First Quarter 2022 Earnings Presentation
Scorpio Tankers Inc. First Quarter 2022 Earnings Presentation April 28, 2022
Slide 2: Disclaimer and Forward-looking Statements
Disclaimer and Forward-looking Statements This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Scorpio Tankers Inc.’s (“Scorpio’s”) curr
Slide 3: Q1 2022 Call Agenda
Q1 2022 Call Agenda 1.Q1 2022 Highlights 2.Product Tanker Market 3.Financial Highlights 4.Conclusion 5.Q&A 3
Slide 4: Q1 2022 Highlights
Q1 2022 Highlights 4
Slide 5: Q1 2022 Highlights
Q1 2022 Highlights Highlights Q4-21 & Q1-22 TCE Rates ($/day) Financial Results Q4-21 Q1-22 $16,305 $15,949 • Adj EBITDA of $79.4 million $13,982 $14,475 $14,145 $12,320 $12,069 $11,597 • Adj net loss of $14.9 million or $0.27 basic and diluted loss per share (1) • Dividend of $0.10 per share Improv
Slide 6: Product Tanker Market
Product Tanker Market 6
Slide 7: Short Term Market Update
Short Term Market Update Weekly MR & LR2 Spot Earnings Since November 2021 ($/day) $50,000 LR2 Eco-Middle East to Japan MR Eco-Avg Earnings MR rates Decrease West of Suez / Increase East of $40,000 USG-Latin America Suez MR Rates Reach Record Levels $30,000 Russia Invades Ukraine $20,000 Steady Impr
Slide 8: Diesel Market Continues to Tighten
Diesel Market Continues to Tighten Diesel Demand Has Been Robust & Above Pre-Pandemic Levels (1) Global Diesel Supply / Demand Balance (1) (mb/d) (mb/d) 30.0 29.2 29.1 29.4 28.9 28.6 28.0 28.3 27.5 27.3 26.8 27.1 26.6 25.0 25.0 20.0 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-21 Q2-22e
Slide 9: Russian Invasion of Ukraine Exacerbates Global Diesel Shortage
Russian Invasion of Ukraine Exacerbates Global Diesel Shortage Russian CPP Exports by Type (excl Fuel Oil) (1) Russian Diesel Trade Flows & Potential Changes (mb/d) Diesel/Gasoil Naphtha Gasoline Other 1.8 1.5 1.5 1.5 1.5 0.1 0.1 0.0 0.1 0.1 0.1 0.1 0.1 1.2 0.5 0.5 0.5 0.5 0.6 0.8 0.9 0.9 0.9 - FY-1
Slide 10: Refinery Rationalization Drives Ton Mile Demand
Refinery Rationalization Drives Ton Mile Demand Refinery Closures By Region (1) Refined Product Ton Mile Demand (2) (mb/d) North America Europe Asia Pacific Latin America Africa Middle East (Billion ton miles) 4,000 1.0 0.9 0.9 Millions 0.8 - 0.2 3,000 0.2 0.4 0.04 0.2 0.5 0.1 2,000 0.1 0.2 0.5 1,00
Slide 11: Seaborne Exports & Ton Miles to Exceed Pre-Pandemic Levels
Seaborne Exports & Ton Miles to Exceed Pre-Pandemic Levels Refined Product Demand Expected to Increase ~4 mb/d from Q1-21 Seaborne Refined Product Exports Increase above Pre COVID Levels in April (mb/d) (mb/d) 25.5 23.6 23.1 21.9 21.9 22.0 22.6 76.9 76.6 78.5 78.6 74.0 74.6 7.0 69.8 7.3 5.9 6.8 7.0
Slide 12: Limited Fleet Growth with Low Orderbook & Ageing Fleet
Limited Fleet Growth with Low Orderbook & Ageing Fleet Orderbook as a % of Fleet at Record Lows Product Tanker Net Fleet Growth 70% Scenario 1 Scenario 2 60% 6.3% 50% 4.8% 4.2% 40% 2.5% 30% 1.9% 2.0% 1.4% 1.3% 20% 0.3% 0.3% 0.0% 10% 5% -1.0% -0.9% 0% -2.0% 2016 2017 2018 2019 2020 2021 2022e 2023e 2
Slide 13: Financial Highlights
Financial Highlights 13
Slide 14: Improving Balance Sheet & Healthy Liquidity Position
Improving Balance Sheet & Healthy Liquidity Position Company to Reduce Debt by $513mm in First Half of 2022 Potential for ~$450mm in Pro Forma Liquidity if Fleet TCE $25,000/day in Q2-22 (1) ($USD millions) ($USD millions) $500 $3,500 $452.1 $452.1 $3,164 $400 $368.6 $83.5 $3,000 $298.2 $2,651 $330.
Slide 15: Significant Operating Leverage & Earnings Potential
Significant Operating Leverage & Earnings Potential Company Fleet TCE Rate Potential Annual Cash Flow Generation Excluding Debt Repayment ($/day) ($USD millions) $1,500 $29,693 $27,929 $22,644 $1,000 $1,215 $1,009 $803 $15,100 $15,415 $597 $12,615 $390 $11,608 $11,166 $11,954 $10,139 $500 $434 $0 OP
Slide 16: Conclusion
Conclusion 16
Slide 17: Investment Highlights
Investment Highlights Inflection Point Largest & Most Improving Has Arrived with Modern Product Balance Sheet & Global Tanker Fleet in Liquidity Reopening from the World Position COVID-19 Highly Attractive Significant Share Price at a Long Term Operating Steep Discount Supply/Demand Leverage to NAV
Slide 18: Q&A
Q&A 18
Slide 19: Appendix
Appendix 19
Slide 20: Quarterly Financial Performance
Quarterly Financial Performance (In '000s of USD) Q1-22 Q4-21 Revenue $ 174,047 $ 147,908 Vessel operating costs (84,832) (85,059) Voyage expenses (2,023) (13) Depreciation (53,828) (60,091) G&A (12,454) (12,808) Loss on vessel sales (67,738) - Total operating expenses (220,875) (157,971) Operating
Slide 21: Product Tankers in the Oil Supply Chain
Product Tankers in the Oil Supply Chain • Crude Tankers provide the marine transportation of the crude oil to the refineries • Product Tankers provide the marine transportation of the refined products to areas of demand • Structural demand drivers in the product tanker industry: • US has emerged as
Slide 22: What is in a Barrel of Crude Oil?
What is in a Barrel of Crude Oil? Source: Valero & EIA, December 2019 22
Slide 23: Product Tanker Sizes, Cargoes & Trade Routes
Product Tanker Sizes, Cargoes & Trade Routes Vessel Types, Cargoes & Trading Regions Product Tanker Trade Routes Handymax MR LR2 Trading Type Short Range Medium Range Long Range DWT 25,000-39,999 40,000-54,999 80,000-120,000 Avg Cargo Size ~200,000 bbls ~300,000 bbls ~700,000 bbls Voyage Length 15-2
Slide 24: Product Tanker Demand Drivers
Product Tanker Demand Drivers Increased Volumes Voyage Distance Product Tanker (Seaborne Trading Activity Demand Exports) (Ton Mile Demand) • Oil consumption • Dislocation • Arbitrage opportunities growth between refinery from price volatility and consumer • Refinery margins • Low inventory levels •
Slide 25: www.scorpiotankers.com
www.scorpiotankers.com