International Seaways, Inc. · NYSE:INSW
International Seaways — Q1 2021 Earnings Presentation
21 slides from International Seaways's earnings presentation, May 6, 2021
Slide 1: International Seaways, Inc. First Quarter 2021 Earnings Presentation
International Seaways, Inc. First Quarter 2021 Earnings Presentation May 6, 2021
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements During the course of this presentation, the Company (International Seaways, Inc. (INSW)) may make forward-looking statements or provide forward-looking information. All statements other than statements of historical facts should be considered forward-looking sta
Slide 3: Business Review
Business Review Lois K. Zabrocky President & CEO 3
Slide 4: First Quarter 2021 Highlights and Recent Developments
First Quarter 2021 Highlights and Recent Developments • Announced Merger Agreement with Diamond S Shipping o Will double INSW’s net asset value in an all-stock merger and triple the size of the fleet; will be second largest US tanker owner by ship count o Accretive to INSW’s earnings, cash flow per
Slide 5: Disciplined Capital Allocation – Fleet Renewal
Disciplined Capital Allocation – Fleet Renewal • International Seaways invested $900 million at the bottom of the cycle o Two Suezmax newbuilding resales purchased for $58 million each in 2017 o 2010-built VLCC purchased for $53 million in 2017 o Six VLCCs built 2016 and 2015 purchased for $434 mill
Slide 6: Market Update – Oil Supply, Demand and Implications
Market Update – Oil Supply, Demand and Implications • Oil Supply and Demand o OPEC+ has announced increased production, as well as rollbacks of Saudi Arabia’s voluntary cuts, amounting to an additional 600,000 b/d production for May, followed by an additional 700,000 b/d in June and 800,000 b/d in J
Slide 7: Market Update – Clean Products
Market Update – Clean Products • Refinery Outages o 2020 saw a drastic reduction in global refinery utilization due to the global pandemic o February 2021 saw a similar drop in US refinery utilization due to record cold temperatures o Both US and global outages are now approaching 5 year lows, which
Slide 8: Market Update – Ship Supply
Market Update – Ship Supply • Orderbook Update o Orderbook remains at historical lows: VLCC Orderbook Recycling Candidates • VLCC 9.6% • Suezmax 8.0% 20 • Aframax/LR2 9.2% 18 • Panamax/LR1 1.5% 16 • MR 6.1% 14 o 31 VLCCs ordered in 2019; 31 in 2020; 27 YTD 2021 Million DWT o Ordering tempered by unc
Slide 9: Financial Review
Financial Review Jeffrey D. Pribor SVP & CFO 9
Slide 10: Financial Summary – TCE Revenue & Adjusted EBITDA
Financial Summary – TCE Revenue & Adjusted EBITDA1 ($ millions) Quarterly: 1Q 2020 vs 1Q 2021 Quarterly TCE Revenue Quarterly Adjusted EBITDA $120 $74 $31 $45 $89 $9 $36 $11 LTM 2020 Q1 Crude Tankers 2021 Q1 Product Tankers 2020 Q1 2021 Q1 Adjusted EBITDA1: LTM: 1Q 2020 vs 1Q 2021 LTM TCE Revenue LT
Slide 11: Financial Summary – 2021 Q1 & Q2 Earnings Update
Financial Summary – 2021 Q1 & Q2 Earnings Update 2021 Q1 Actual 2021 Q2 to Date 1 SPOT TC OVERALL SPOT TC OVERALL TCE TCE TCE Fixed TCE Fixed TCE Fixed TCE VLCC (ALL) $15,700 $47,400 $21,100 63% $15,200 100% $43,900 67% $19,800 Scrubber $17,100 $43,900 $20,400 62% $15,600 100% $43,900 66% $20,400 No
Slide 12: Lean and Scalable Model – Cash Breakevens
Lean and Scalable Model – Cash Breakevens TCE breakeven levels allow INSW to navigate low points in the tanker cycle while providing significant operating leverage in rising markets INSW Daily OPEX excludes DDK deviation bunkers, insurance claims and one-off expenses G&A for the Lightering segment i
Slide 13: Financial Summary – Change in Cash Balance
Financial Summary – Change in Cash Balance 13
Slide 14: Strong Financial Position – Balance Sheet
Strong Financial Position – Balance Sheet Strong balance sheet protects INSW during low portions of tanker cycle March 31, 2021 ($ M) Assets Liabilities INSW Book Value of FSO JV as of Current Liabilities (including $61M current March 31, 2021: $132 million Cash and Equivalents $156 portion of long
Slide 15: Summary
Summary • Announced Merger Agreement with Diamond S Shipping o Will double INSW’s net asset value in an all-stock merger and triple the size of the fleet; will be second largest US tanker owner by ship count o Accretive to INSW’s earnings, cash flow per share o Estimated annual cost synergies of $23
Slide 16: Appendix
Appendix 16 International Seaways, Inc.
Slide 17: Estimated Drydock and CAPEX costs and Out-of-Service Days
Estimated Drydock and CAPEX costs and Out-of-Service Days ($ millions) 2021 Out-of-Service Days Q1 (A) Q2 (E) Q3 (E) Q4 (E) FY 2021 VLCC 76 158 0 52 287 Suezmax 0 0 0 0 0 Aframax / LR2 0 0 6 6 12 Panamax / LR1 169 6 0 32 208 MR 2 0 19 3 24 248 164 25 93 531 2021 Drydock Costs Q1 (A) Q2 (E) Q3 (E) Q4
Slide 18: TCE Revenue Reconciliation
TCE Revenue Reconciliation ($ thousands) 1Q20 1Q21 LTM 1Q20 LTM 1Q21 Time charter equivalent revenues 119,731 45,169 365,621 327,443 Add: Voyage expenses 5,606 1,587 24,026 15,624 Shipping revenues 125,337 46,756 389,647 343,067 18
Slide 19: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ thousands) All INSW 1Q20 1Q21 LTM 1Q20 LTM 1Q21 Net income / (loss) 33,019 (13,365) 21,292 (51,915) Income tax provision - - 1 1 Interest expense 12,009 7,280 60,743 31,983 Depreciation and amortization 18,267 16,754 74,991 72,830 EBITDA 63,295 10,670 157,027 52,900
Slide 20: Chartered In Fleet
Chartered In Fleet Charter-In Hire Details • Time Charter-Ins: – 1 LR1 vessel that redelivers in August 2021 – Charter Hire expense for 2021 : $1.7M • Bareboat-Ins: – 2 Aframax vessels that redeliver in 2024 – Charter Hire expense for 2021 : $4.7M • Lightering: – 5 workboats that redeliver between J
Slide 21: INSW Fleet as of May 4, 2021
INSW Fleet as of May 4, 2021 Ship Type Built DWT Ownership Ship Type Built DWT Ownership Gener8 Chiotis VLCC 2016 300,973 Owned Seaways Leyte LR1 2011 73,944 Owned Seaways Cape Henry VLCC 2016 300,932 Owned Seaways Samar LR1 2011 73,920 Owned Seaways Triton VLCC 2016 300,933 Owned Seaways Guayaquil
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