On August 7, 2024, International Seaways Inc (INSW, Financial) released its 8-K filing detailing the company's financial performance for the second quarter of 2024. International Seaways Inc owns and operates a fleet of oceangoing vessels engaged in the transportation of crude oil and petroleum products. The company's operations are divided into two segments: Crude Tankers and Product Carriers.
Performance and Challenges
International Seaways Inc reported a net income of $144.7 million, or $2.91 per diluted share, for the second quarter of 2024. This result exceeded the analyst estimate of $2.17 per share. However, the company faced a decline in shipping revenues, which totaled $257.4 million, falling short of the estimated $244.10 million and down from $292.2 million in the same period last year. The decrease in revenue was primarily driven by lower TCE revenues and increased depreciation costs.
Financial Achievements
Despite the revenue shortfall, International Seaways Inc achieved significant milestones. The company continued its fleet optimization program by acquiring six modern MR vessels and selling older tonnage, which contributed to gains on vessel sales. Additionally, the company enhanced its balance sheet by increasing liquidity to $682 million and reducing mandatory debt repayments through a new revolving credit facility.
Income Statement Highlights
Key details from the income statement include:
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Income | $144.7 million | $153.8 million |
| EPS (Diluted) | $2.91 | $3.11 |
| Shipping Revenues | $257.4 million | $292.2 million |
| Adjusted EBITDA | $167.0 million | $205.1 million |
Balance Sheet and Cash Flow
International Seaways Inc reported total assets of $2.67 billion as of June 30, 2024, up from $2.52 billion at the end of 2023. The company's cash and cash equivalents increased to $176.1 million from $126.8 million. The company also repaid $12 million in mandatory debt payments during the second quarter and amended its $750 million credit facility to a $500 million revolving credit facility, which is expected to save $19.5 million per quarter in mandatory debt repayments.
Returns to Shareholders
In June 2024, International Seaways Inc paid a combined dividend of $1.75 per share, including a regular quarterly dividend of $0.12 and a supplemental dividend of $1.63. The company's Board of Directors declared a combined dividend of $1.50 per share on August 6, 2024, to be paid on September 25, 2024.
Analysis
International Seaways Inc's performance in the second quarter of 2024 highlights the company's ability to generate strong earnings despite a challenging revenue environment. The company's strategic fleet optimization and balance sheet enhancements position it well for future growth. However, the decline in shipping revenues and TCE rates indicates potential headwinds in the market. Investors should monitor these trends closely as they evaluate the company's long-term prospects.
Explore the complete 8-K earnings release (here) from International Seaways Inc for further details.
