TEN’s Net Income Drops while Revenues Rise

Despite an increase in its voyage revenues for the period ended June 30, 2017, Greek tanker operator Tsakos Energy Navigation (TEN) saw a drop in its net income.

Namely, for the first six months of 2017, TEN’s net income halved at USD 21.1 million when compared with USD 41.8 million seen in the first half of 2016.

Over the period, the company’s voyage revenues surged to USD 270.4 million from USD 241.9 million reported in the first half of 2016. The daily time charter equivalent rate per vessel was USD 20,038 and fleet utilization increased to 96.8% compared to USD 22,477 and 95.8% respectively in the same half of 2016.

Operating income for the period was USD 49.1 million, down from USD 57.4 reported a year earlier.

TEN also witnessed a drop in its net income for the second quarter of the year, which landed at USD 3.6 million compared to USD 16.4 million reported in the same three-month period in 2016, while its voyage revenues increased to USD 132.2 million from USD 119.9 million year-on-year.

Revenues, net of voyage expenses, amounted to $104.1 million, an increase of 9.7% from the second quarter of 2016 due mainly to the eleven newbuilding vessels delivered to TEN and now operating in the fleet.

The company’s operating income dropped to USD 19.3 million from USD 24.3 million delivered in the quarter ended June 30, 2016.

Despite difficult market conditions, TEN’s fleet operated at 96.4% utilization in the second quarter of 2017, during which TEN operated, on average, a fleet of 62.3 vessels compared to 50.5 vessels in the second quarter of 2016.

“TEN’s industrial shipping model is continuously reinforced with over 75% of the fleet on long term employment, including profit sharing provisions. This offers cash flow stability, visibility and substantial upside potential,” George Saroglou, Chief Operating Officer of TEN, said.

In the first two quarters of the year, 22 new time charter contracts to international oil concerns have commenced including new strategic relationships with major end users. This brings the company’s time charter coverage of the fleet to more than 75%.

“The continuous appetite of global oil concerns to cover their long term needs with solid charters is a positive sign for upcoming developments in the global oil markets. TEN, with one of the youngest fleets in international tanker shipping, will be well positioned to benefit from expected market upturns,” Saroglou concluded.