International Seaways, Inc. (INSW), one of the largest tanker companies worldwide providing energy transportation services for crude oil and petroleum products in International Flag markets, today reported results for the fourth quarter and full year 2016.

Highlights

Successfully completed the spin-off from its former parent company, Overseas Shipholding Group, Inc.

Time charter equivalent (TCE) revenues(A) for the fourth quarter and full year 2016 were $82.2 million and $385.0 million, down 31% and 19%, respectively, compared with the same periods in 2015.

Net loss for the fourth quarter was $57.8 million, or $1.98 per diluted share, compared with net income of $37.6 million, or $1.29 per diluted share for the fourth quarter 2015. The decrease reflects the impact of impairment charges of $60.1 million recorded in the fourth quarter 2016.

Net loss for the full year 2016 was $18.2 million, or $0.62 per diluted share, compared with net income of $173.2 million, or $5.94 per diluted share for the full year 2015.

Adjusted EBITDA(B) for the fourth quarter and full year 2016 were $37.5 million and $222.0 million, down 47% and 26%, respectively, from $71.1 million and $299.2 million in the same periods in 2015.

Total cash(C) was $92.0 million as of December 31, 2016.

Received a letter of award related to a five-year contract for its FSO joint ventures.

“We are pleased to have successfully completed the separation of International Seaways from OSG and to begin our journey as an independent public company,” said Lois K. Zabrocky, International Seaways’ president and CEO. “During the quarter, we also received a letter of award on a five-year contract for our FSO joint ventures, and we continue with negotiations on that project.”

Ms. Zabrocky continued, “Looking forward, International Seaways has a diversified 55 vessel fleet positioned to optimize revenue through a balanced mix of contracted cash flows and spot market upside. Our lean and scalable model and low break-evens along with our strong financial position allow us to navigate through the volatility in the tanker cycle while providing significant operating leverage to take advantage of a market recovery. While we expect the year ahead to present a number of challenges, I am confident in the solid foundation we have built and the measures we continue to take to create a platform for success. We have a strong set of assets and capabilities along with the right people and strategies to effectively execute and drive shareholder value.”

Fourth Quarter 2016 Results

Consolidated TCE revenues for the fourth quarter of 2016 were $82.2 million, a decrease of $37.6 million, or 31%, compared with the fourth quarter of 2015. Shipping revenues for the fourth quarter of 2016 were $85.8 million, a decrease of $39.2 million compared with the fourth quarter of 2015.

Operating loss for the quarter was $47.8 million, compared to operating income of $49.9 million for the fourth quarter of 2015. The decrease reflects the impact of impairment charges of $60.1 million recorded in the current quarter, $5.6 million of separation and transition costs and the decline in TCE revenues referred to above.

Net loss for the fourth quarter of 2016 was $57.8 million, or $1.98 per diluted share, compared with net income of $37.6 million, or $1.29 per diluted share in the fourth quarter of 2015.

Adjusted EBITDA was $37.5 million for the quarter, a decrease of $33.5 million compared with the fourth quarter of 2015, driven by lower daily rates.

International Crude Tankers

TCE revenues for the International Crude Tankers segment were $54.1 million for the quarter, down 36% compared with the fourth quarter of 2015. This decrease was primarily due to a decline in VLCC and Aframax rates, with spot rates declining to $32,100 and $15,100 per day, respectively, resulting in a $29.2 million decline in TCE revenues. Shipping revenues for the International Crude Tankers segment were $58.8 million for the quarter, down 34% compared with the fourth quarter 2015.

International Product Carriers

TCE revenues for the International Product Carriers segment were $27.5 million for the quarter, down 23% compared with the fourth quarter of 2015. This decrease was primarily due to a decline in MR spot rates, with spot rates declining to $10,800 per day. The decline in blended MR rates resulted in an $11.7 million decline in TCE revenues. This decrease was partially offset by increased revenue days in the LR1 and MR fleets due to fewer drydock and repair days, which accounted for a $3.9 million increase in TCE revenues. Shipping revenues for the International Product Carriers segment were $27.0 million for the quarter, down 25% compared with the fourth quarter 2015.

Full Year 2016 Results

Consolidated TCE revenues for the full year 2016 were $385.0 million, a decrease of $90.7 million, or 19%, compared with the full year 2015. Shipping revenues for the full year 2016 were $398.3 million, a decrease of $99.3 million compared with the full year 2015.

Operating income for the full year 2016 was $22.8 million, compared to operating income of $221.9 million for the full year 2015. The decrease reflects the impact of impairment charges of $109.7 million, $9.0 million of separation and transition costs and the decline in TCE revenues referred to above, partially offset by a decrease in general and administrative expenses of $9.9 million in 2016.

Net loss for the full year 2016 was $18.2 million, or $0.62 per diluted share, compared with net income of $173.2 million, or $5.94 per diluted share in the full year 2015.

Adjusted EBITDA was $222.0 million for the full year 2016, a decrease of $77.2 million compared with the full year 2015, driven by lower daily rates.

International Crude Tankers

TCE revenues for the International Crude Tankers segment were $258.2 million for the full year 2016, down 15% compared with the full year 2015. This decrease was primarily due to a decline in VLCC and Aframax rates, with spot rates declining to $42,000 and $21,300 per day, respectively, resulting in a $65.3 million decline in TCE revenues. This decrease was partially offset by increased revenue days in the VLCC and Aframax fleets due to fewer drydock and repair days, which accounted for a $11.6 million increase in TCE revenues, along with a $5.2 million increase in revenue resulting from the Company’s ULCC being taken out of lay-up in the first quarter of 2015. Shipping revenues for the International Crude Tankers segment were $271.8 million for the full year 2016, down 16% compared with the full year 2015.

International Product Carriers

TCE revenues for the International Product Carriers segment were $126.3 million for the full year 2016, down 26% compared with the full year 2015. This decrease was primarily due to a decline in MR spot rates, with spot rates declining to $13,100 per day. The decline in blended MR rates resulted in a $41.3 million decline in TCE revenues. Also contributing was a decrease in revenue days in the MR fleet due to the sale of a 1998-built MR in July 2015 as well as the redelivery of an MR to its owners at the expiry of its time charter in March 2015. Shipping revenues for the International Product Carriers segment were $126.6 million for the full year 2016, down 27% compared with the full year 2015.

International Seaways, Inc. (INSW) is one of the largest tanker companies worldwide providing energy transportation services for crude oil and petroleum products in International Flag markets. International Seaways owns and operates a fleet of 55 vessels, including one ULCC, eight VLCCs, eight Aframaxes/LR2s, 12 Panamaxes/LR1s and 20 MR tankers. Through joint ventures, it has ownership interests in four liquefied natural gas carriers and two floating storage and offloading service vessels. International Seaways has an experienced team committed to the very best operating practices and the highest levels of customer service and operational efficiency. International Seaways is headquartered in New York City, NY.

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Source: International Seaways Inc.