International Seaways, Inc.

Good morning, everyone, and welcome to the International Seaways Inc. Second Quarter 2025 Earnings Conference Call. My name is Carla, and I will be coordinating your call today. During the presentation, you can register to ask questions by pressing star followed by one on your telephone keypad. If you change your mind, please press star followed by two. I would now like to hand you over to your host, James Small, General Counsel, to begin. Please go ahead when you're ready.

Thank you, Operator. Good morning, everyone, and welcome to International Seaway's earnings call for the second quarter of 2025. 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, forecasts 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, new build vessel construction, vessel purchases and sales, anticipated financing transactions and plans to issue dividends, the effects of ongoing and threatened conflicts around the globe, economic, regulatory, and political developments in the United States and globally, the company's ability to achieve its financing and other objectives and its consideration of strategic alternatives, and the company's relationships with its stakeholders. Any such forward-looking statements take into account various assumptions made by management TAB, Mark McIntyre, based on a number of factors, including management experience and perception of historical trends current conditions expected them future developments and other factors that management believes are appropriate to consider in the circumstances. TAB, Mark McIntyre, or looking statements are subject to risks uncertainties and assumptions, many of which are beyond the company's control that could cause actual results to different materially from those implied or expressed by the state. Factors, risks, and uncertainties that could cause the company's actual results to differ from expectations include those described in our annual report on Form 10-K for 2024 and our quarterly reports on Form 10-Q for the first and second quarters of 2025, as well as 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 our President and Chief Executive Officer, Lois LeBron.

Lois? Thank you, Gene. Good morning, everyone. Thank you all for joining International Seaway's earnings call for the second quarter of 2025. On slide four of the presentation, found in the investor relations section of our website, net income for the second quarter was $62 million, or $1.25 per diluted share. Excluding gains on settled sales, adjusted net income for the second quarter was $50 million, or $1.02 per share and adjusted EBITDA was $102 million. Today, we also announced a combined dividend of 77 cents per share to be paid in September, as you can see in the lower left section of the slide. This is our fourth consecutive quarter of a payout ratio of at least 75%. We continue to believe in building on our track record of returning to shareholders as part of our consistent and balanced capital allocation strategy. Since we started supplementing a regular 12 cents per share dividend in the fourth quarter of 2022, we have paid combined dividends of $15.25 per share, which equates to a dividend yield of about 14% per year on our average market cap. Share repurchases remain an option for Seaway, and this would be additive to our payout ratio. On the upper right hand side, we have sold or agreed to sell six of our oldest vessels with an average age of 17 and a half years. Two were sold within the second quarter for proceeds of $28 million, with the other four delivering during the third quarter for proceeds of around $57 million. We have also taken steps to utilize those proceeds with our agreement to purchase a 2020 built scrubber fitted VLCC delivering in the fourth quarter. The impact of these sales and purchase reduce our age by half a year. Fleet renewal is always part of our strategy and we expect to execute sales and purchases throughout the tanker cycle. We continue to work through our time charter book as well We still have over $260 million in future contracted revenues on 12 vessels with an average duration of around two years. The first of our six LR1 new billings is set to be delivered in September. We are very pleased to share our expected financing for up to $240 million of the $300 million in outstanding payments. We have received secured commitments for export agency financing. with KSHR and DMV across two tranches. On a blended basis, the agreement carries a 20-year amortization profile, bearing interest of SOFR plus 125 basis points over the 12-year maturity. Funds will be drawn upon delivery of each vessel starting in the third quarter through September of 2026. All of this is subject to final documentation and closing expected later this month. with the remaining funding for these vessels to be sourced through cash on hand. We ended Q2 with over $700 million in total liquidity, with $149 million in cash and $560 million in undrawn revolver capacity. Our gross debt was $553 million on over $3 billion in fleet value. Our net loan-to-value is comfortably under 15%. We are proud of the strength of our balance sheet. With ample liquidity, debt below our recycled values, and low cash breakevens, we are able to grow the company and create further enhancements like our most recent financing. With breakeven levels where our spot shifts only need to make $13,000 per day, we expect to continue executing our balanced strategy. Turning to slide five, We've updated our standard set of bullets on tanker demand drivers with the green up arrows next to the bullets representing good for tankers, the blank dash representing neutral impact, and a red down arrow meaning the topic is not positive for tanker demand. Without reading these bullets individually, we do believe demand fundamentals are solid and continue to support a constructive outlook for seaborne transportation. Recent upward revisions to forecasted GDP may increase oil demand forecasts. The OECD has maintained crude storage at historically low levels that are slowly rising in 2025, as you can see in the chart on the lower left-hand side. Product inventories are also at historically low levels. Specifically, we are short on middle distillates, whose growing demand worldwide has increased the refinery margins and is currently pushing up refinery utilization. We've noted in the bottom right chart that over the next five years, refining capacity is growing east of Suez and largely for export purposes, while we have seen more capacity shutting down in the west. This is very supportive of the refined product ton-mile demand. The release of these barrels may impact non-OPEC production as these areas may be more sensitive to price fluctuations if prices decline significantly. The geopolitical environment remains fluid, making sustained trends in new trade routes more difficult to identify. This quarter alone saw an escalation within the Straits of Hormuz that grabbed headlines and was short-lived in the escalation of VLCC rates. Many vessels on subjects in late June were failed within the week. There are scenarios for an uptick in rates if there is sustained escalation of tensions. And there are scenarios for full de-escalation and peace, which could also rationalize the aging tanker fleet. This brings us to the supply side of slide six in the presentation. It remains one of the most compelling cases for tanker shipping. Tankers are currently on order representing 15% of the existing fleet. with this 15% delivering over the next four to five years. Over a 25 year life of a vessel, we would expect as much with a 4% increase per year of removal candidates multiplied by the four years it takes to deliver the new vessels. In practicality, based on actual ship deliveries, there is a significant number of removal candidates that were built in the golden age 204 to 210. In the graph on the lower left of the page, we note the relationship of older vessels to the order book. Since 2021, the fleet over 20 years, which are removal candidates exceeds the ships on order. By the time the order book delivers in 2029, nearly 50% of this fleet will be over 20 years old and likely excluded from the commercial trade. There is simply not enough ships on order to replace the current aging fleet. We show this in the graph in the lower right. 800 plus ships shall deliver over the next four years representing only one third of the likely tonnage to face trading challenges during the same period. Not to mention ever tightening regulations and either further environmental pressures. We believe this should translate into a combined up cycle over the next few years and Seaways is capitalizing on these market conditions. We will continue to execute our balanced capital allocation approach to renew our fleet and to adapt to industry conditions with a strong balance sheet while returning shareholders. Now I'm going to turn it over to our CFO, Jeff Pribor, to share the financial review. Jeff.