International Seaways, Inc.

Hello everyone and welcome to the International Seaways Inc third quarter 2024 earnings conference call. My name is Carla and I will be coordinating the call today. During the presentation you can register your question by pressing star followed by one on your telephone keypad and if you change your mind please press star followed by two. I will now hand you over to your host James Small, General Counsel at International Seaways to begin. James, please go ahead.

Thank you. Good morning, everyone, and welcome to International Seaway's earnings call for the third quarter of 2024. Before we begin, I would like to start off by advising everyone with us on the call today of the following. During this call and in the accompanying presentation, management may make forward-looking statements regarding the company or the industry in which it operates. Those statements may address, without limitation, the following topics. Outlooks for the crude and product tanker markets and changes in oil trading patterns. Forecasts of world and regional economic activity and of the demand for and production of oil and other petroleum products. The effects of ongoing and threatened conflicts around the globe. The company's strategy and business prospects. Expectations regarding revenues and expenses, including vessel, charter hire, and G&A expenses. Estimated future bookings, TCE rates, and capital expenditures. Projected scheduled dry dock and off-hire days. purchases and sales of vessels and construction of new-build vessels, the company's consideration of strategic alternatives, anticipated financing transactions and plans to issue dividends, the company's relationships with its stakeholders, the company's ability to achieve its financing and other objectives, and other political, economic, and regulatory developments globally. Any such forward-looking statements take into account various assumptions made by management based on a number of factors, including management's experience and perception of historical trends, current conditions, expected and future developments, and other factors that management believes are appropriate to consider in the circumstances. Overlooking statements are subject to risks, uncertainties, and assumptions, many of which are beyond the company's control, that could cause actual results to differ materially from those implied or expressed by the statements. Factors, risks, and uncertainties that could cause international COAs actual results to differ from expectations include those described in our annual report on Form 10-K for 2023, our quarterly reports on Form 10-Q for the first three quarters of 2024, and in other filings that we have made or in the future may make with the U.S. Securities and Exchange Commission. Now, let me turn the call over to Ms. Lois LeBrock, our President and Chief Executive Officer. Lois?

Thank you very much, James. Good morning, everyone. Thank you for joining International Seaway's earnings call for the third quarter of 2024. Starting on slide four and noting our presentation can be found under investor relations on our website. Net income for the third quarter was $92 million, or $1.84 per diluted share. Excluding the gains on vessel sales and other one-off items, Adjusted net income for the third quarter was $78 million for $1.57 per share. Our EBITDA was over $143 million with adjusted EBITDA at $130 million. Referencing our balance sheet on the upper right-hand chart, we have nearly $700 million in total liquidity, which includes over $540 million of undrawn revolver capacity. With our gross debt at $660 million and our net debt at $500 million, our net loan to vessel value is historically low at under 14%. With no maturity until the next decade and 34 unencumbered vessels, the cash break even on our spot fleet is under $13,500 per day. We referenced our fleet optimization on the lower left section of the slide as we sold another vessel for $24 million in net proceeds. Overall during 2024, we sold three 15-year-old MRs for a total of $72 million and acquired six MRs under 10 years old for $232 million, partially funded by 624,000 shares issued in the second quarter. On the lower right, using proceeds from our last vessel sale, we purchased and retired over 500,000 shares at an average price of under $50 per share. In the same quarter, we paid a combined dividend of $1.50 per share. This combined $100 million in returns to shareholders over the third quarter represented 84% of our adjusted net income from the prior quarter. Today, we announced a combined dividend of $1.20 per share according to over 75% of our third quarter adjusted net income. Over the last 12 months, B-Ways has returned over 12% of our average market cap. We continue to believe in our balanced capital allocation approach, positioning the company for the future with opportunistic fleet renewal and enhancing our balance sheet while sharing in our upcycle with a double-digit dividend yield to our shareholders. On slide five, we've updated our set of bullets on tanker demand drivers with a subtle green up arrow next to the bullet represented as positive for tankers. The black dashes representing a neutral impact and a red down arrow meaning the driver is not positive for tanker demand. Pulling some highlights, oil demand growth over the next two years is still at or above the growth rate over the last 30 years. While China has lost some steam in its oil demand growth, we're monitoring the impacts of their announced stimulus, which has yet to be factored into oil demand forecasts for 2025 and beyond. During the third quarter, we saw weaker production from OPEC+, largely due to Libyan disruption. OPEC has now decided to hold off increasing output from December until January of 2025. The outcomes of elections worldwide may impact tanker demand, and it remains uncertain how shifting world politics will ultimately impact us. Finally, at the bottom of the page, the chart shows OECD inventories with a slight build in the third quarter. U.S. inventories, which are readily available each week, have shown draws over the last few months. Inventory draws negatively impact tanker demand in the short term But over time, this flipped to a positive factor for tankers as demand calls for barrels on the water. On slide six, the order book of tankers did creep up during 2024. Still, as you can see in the lower left-hand chart, shifts on order are still quite low relative to the size of the fleet in historical context. Not factored in on this chart, but reflected on the lower right-hand side of the page, New orders that deliver over the next four years barely replace the fleet that is turning 25 years old, the natural end of a ship's life. There are another 1,500-plus vessels that are turning 20 years old above the delivery schedule that need replacement. This is significant for the tanker industry as a limited tanker supply continues to be supportive of strong tanker earnings. We believe this translates into a continued strength over the next few years with Seaway's well-positioned to continue capitalizing on the market conditions. You can count on us to utilize our balanced capital allocation approach, renewing our fleet, adapting to industry conditions, and keeping a strong balance sheet while returning to shareholders. I'm now going to turn it over to our CFO, Jeff Prevore, to provide the financial review.