Tsakos Energy Navigation Sees Drop in Net Income

first_imgzoom Greek tanker owner and operator Tsakos Energy Navigation Limited (TEN) posted a net income of USD 16.4 million in the second quarter of 2016, down from USD 41.2 million reported in the same quarter in 2015.TEN’s fleet continued to operate at almost full utilization in the second quarter. Excluding the LNG carrier Neo Energy’s repositioning voyage for its next employment, the productivity of the core fleet was 98% net of scheduled dry-dockings.Revenues, net of voyage expenses, amounted to USD 94.8 million, a reduction from the 2015 second quarter due to the repositioning voyage of the Neo Energy, while the average daily time charter equivalent (TCE) rate was USD 21,602 in the quarter including the repositioning of the LNG vessel.The newly built VLCC Ulysses was delivered in mid second-quarter and had a spot charter which contributed nearly USD 1 million to the bottom line of the second quarter, according to TEN. Following completion of that voyage in early July, the vessel started a 40-month charter to a Far Eastern end user at an accretive rate.The newbuilding aframax Elias Tsakos was delivered to its charterer, Statoil, just two days before the second quarter-end and its sister vessel the Thomas Zafiras together with the LR1 product carrier, Sunray, were delivered in August 2016.TEN has two further aframaxes and an LR1 product carrier scheduled for delivery in the third and fourth quarter of 2016.Although the size of the fleet compared to the second quarter of 2015 increased with the addition of two new suezmaxes and a VLCC, the average daily operating expenses per vessel fell by nearly 2% to USD 8,026, mainly due to proactive cost controls by TEN’s technical managers.TEN said that its balance sheet “remained strong with cash balances at a healthy USD 262.5 million.” In addition, as of June 30, 2016, TEN has undrawn bank facilities totaling USD 452 million, relating to thirteen vessels under construction, of which USD 37 million has since been drawn for the recent deliveries.The company’s net income for the first six months of 2016 plunged to USD 41.8 million from USD 78.5 million seen in the first half of 2015, amid a softened tanker market.Operating income for the first half was USD 57.4 million, down from USD 94.8 million reported a year earlier.The company’s total contracted revenues, over a pro forma fleet of 65 vessels, amount to a minimum of USD 1.4 billion with an average charter employment of 2.8 years.“TEN is in the midst of its largest growth program since inception. With the introduction of the new vessels under long term contracts to major end users, we expect TEN’s value to grow significantly,” Nikolas P. Tsakos, President and CEO of TEN said.With oil prices still at low levels with no signs today of reaching the lofty heights of 2014, a significant part of the world’s orderbook already absorbed, and few vessels expected to be ordered in the next eighteen months, TEN said that the tanker markets “should return to healthier levels in the near future albeit with the customary and expected aberrations that characterize the seasonality of the industry.”last_img read more