International Seaways, Inc.

Hello and welcome to the International Seaways Inc. Fourth Quarter 2024 Earnings Conference Call. My name is Carla and I will be coordinating your call today. During the presentation, you will have the opportunity to register a question by pressing star followed by 1 on your telephone keypad. If you change your mind, please press star followed by 2. I would now like to hand you over to James Small, General Counsel, to begin. James, please go ahead when you're ready.

Thank you, operator. Good morning, everyone, and welcome to International Seawaste Earnings Call for the fourth 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, which may address, without limitation, the following topics. Outlooks for the crude and product tanker markets, changes in trading patterns, Forecasts of world and regional economic activity and of the demand for and production of oil and petroleum products. The company's strategy and business prospects. Expectations about revenues and expenses, including vessel, charter hire, and G&A expenses. Estimated future bookings, TCE rates, and capital expenditures. Projected dry dock and off-hire days. Vessel sales and purchases. New build vessel construction. the effects of ongoing and threatened conflicts around the globe, the changing global regulatory environment, the company's ability to achieve its financing and other objectives and its consideration of strategic alternatives, anticipated financing transactions and plans to issue dividends, the company's relationships with its stakeholders, and other political, economic, and regulatory developments globally. Any such forward-looking statements take into account various assumptions made by management based on the 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. Forward-looking statements are subject to risks, uncertainties, and assumptions, many of which are beyond the company's control. Those 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 2024 and in other filings 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 Dabrocki, our President and Chief Executive Officer. Lois?

Thank you very much, Shane. Good morning, everyone. Thank you for joining International Seaway's earnings call for the fourth quarter and the full year of 2024. On slide four of the presentation, which you can find in the investor relations section of our website, net income for the fourth quarter was $36 million, or 72 cents per diluted share. Excluding a loss on vessel sales, adjusted net income for the fourth quarter was $45 million, or 90 cents per diluted share, and our adjusted EBITDA was $95 million. We are proud to announce today that we continue to modernize our fleet during the fourth quarter with a vessel swap, as you can see in the upper right-hand corner of the slide. We sold two of our oldest VLCCs and paid $3 million in cash for three EcoMRs built in 2015. The swap is less indicative of a specific preference for any one particular class of ship, but more showcases our ability to opportunistically reduce our vessel ages across various ship classes, enhance our fleet efficiency, while limiting risk compared to a full cash transaction. We have optimized earnings across our tanker segment, which gives us plenty of flexibility to execute fleet optimization. The various transactions within the swap created some temporary changes to our balance sheet in the fourth quarter and the first few months of 2025. During the fourth quarter, we paid $53 million in cash for deposits and the delivery of one MR vessel. Due to this temporary timing difference, we borrowed $70 million on a revolving credit facility, which has been repaid in the first quarter following the final execution of the swap. As a result, our line of credit capacity reduced to a still quite healthy $475 million at the end of the fourth quarter. We expect that to be around $560 million on a pro forma basis. Our balance sheet highlights are strong. Shown in the bottom left of the slide, $632 million of total liquidity composed of 157 million of cash and 475 million on the revolving credit facility. We have $695 million of debt with a net loan to value ratio of below 16% and our spot break even rate are about $13,700 per day. On the lower right, we are proud to have shared for a second consecutive year over $300 million returned to shareholders in 2024. We paid $5.77 in dividends during 2024, representing a 12% dividend yield on our average share price over the time. We also used proceeds from that sale of an older MR to repurchase 500,000 shares for $25 million during 2024. Today we announced $0.70 in dividends that we will pay in March, representing a payout ratio of about 77%, marking our highest since we've been supplementing a regular $0.12 dividend. We believe in sharing with our shareholders. during this cycle and we expect a payout ratio similar to this last two quarters of around 75% to continue into the future. We believe in our balanced capital allocation approach so that we can provide competitive returns to our shareholders and still position the company for the future with opportunistic fleet renewal while maintaining a healthy balance sheet to support growth. On slide five, we've updated our standard set of bullets on tanker demand drivers with the subtle green up arrows next to the bullets represented as good for tankers, the black dash representing a neutral impact, and a red down arrow, meaning that particular topic is not good for tanker demand. Without reading these bullets individually, I will pull some highlights. Oil demand growth. in the near term is still going to grow at its historical rate of about 1% per year, which on 100 million barrels per day of demand is about 1 to 1.5 million barrels of growth anticipated for 2025. Oil demand growth specifically is spread across the world in 2025 with no one large outlier as China has been for many years. Crude production growth is largely coming from the Americas, which is supportive for tanker demand as much of the incremental growth will be exported. The global economy is still settling the dust from a post-2024 election period, and there have always been headline grabbers, particularly from the United States. The geopolitical situations are not going away. They may modify and that could have an effect on the tanker market, but with many moving parts, the markets will adjust. We expect the United States to take a stronger position with Iran and we see tanker movements shadowing that. Pun intended. The Israel Hamas conflict is still very tense and most ships are wary of their safety in the Red Sea. Russia-Ukraine is similar. And even if there is a resolution on the horizon, we believe that the unwinding could last longer for Russian crews moving to the West. We embrace these tanker markets because we can't control them in any case. And we believe that sanctions and their enforcement can only help the legitimate commercial fleet. In the charts below on slide five, inventory in the OECD drew about 100 million barrels in the second half of the year. This in the short term impacted tanker rates and will refill over time based on history. The United States SPR has grown in 2024 in small chunks. President Trump has indicated refilling the SPR is a priority to historic level. This would mean around 300 plus million barrels, which may include imports of medium sour crude, which has historically been a medium. On slide six, the order book popped in 2024, particularly in the middle of the year. But as seen in the lower left chart, shifts on order are still quite low relative to the size of the fleet in historical context. We added a weighted average tanker rate in the chart as an indicator that orders grow when the market is hot. But as we've shown many times, not factored into the chart on the left is the longer time horizon that many of these shifts on order are expected to deliver over the next four years and the corresponding age of vessels on the water over this time. The chart on the right reflects that 45% of the fleet is headed towards 20 plus years. the age where we identify as removed from the commercial fleet compared to 14% of the fleet that exists on order. As you can see, there are about 900 ships that are already 20 years old and there are still another 1500 plus vessels that are turning 20 during delivery schedules that will need replacement. This is significant for the tanker industry as the limited tanker supply continues to be supportive of strong tanker earnings. We believe this should translate into a continued upcycle over the next few years, and Seaways remains well positioned to capitalize on these market conditions. We will continue to execute our balanced capital allocation approach to renew our fleet and adapt to industry conditions with a strong balance sheet while returning to shareholders. I'm now turning it over to our CFO, Jeff Prevore, who will provide the financial review. Jeff?