Scorpio Tankers (STNG) Q3 2024 earnings summary

Executive summary

• Reported Q3 2024 adjusted EBITDA of $166.1 million and adjusted net income of $87.7 million, with basic EPS of $1.83 and diluted EPS of $1.75; net income including vessel sales was $158.7 million.

• Significant deleveraging with $817.9 million in debt and lease repayments YTD through October 25, 2024, and net debt at $675.4 million as of October 25, 2024.

• Returned $7.13 per share to shareholders in 2024 via buybacks and dividends, including a $0.40 per share quarterly dividend.

• Acquired a 4.9% stake in DHT Holdings for $89.1 million, reflecting a constructive outlook on the crude tanker sector.

• Completed sale of six MR product tankers and agreed to sell three more vessels, continuing fleet optimization.

Financial highlights

• Q3 2024 adjusted EBITDA was $166.1 million and adjusted net income was $87.7 million; vessel revenue was $268.0 million.

• Year-to-date, produced $1.7 billion in adjusted EBITDA and $1.1 billion in adjusted net income over seven quarters.

• Outstanding indebtedness reduced by ~$2.2 billion since December 31, 2021, including lease financing.

• Liquidity stands at $463 million pro forma, with cash and equivalents at $220.5 million as of October 25, 2024.

• Average daily TCE in Q3 2024 was $28,488, slightly up from $28,313 in Q3 2023.

Outlook and guidance

• Q4 2024 spot and pool TCE rates as of October 28, 2024: LR2 at $31,600/day, MR at $20,800/day, HM at $13,000/day.

• Seaborne exports and ton mile demand are expected to outpace fleet growth, supporting a positive market outlook.

• Limited fleet growth anticipated due to a low orderbook and aging fleet, with significant scrapping expected.

• Seasonal strength anticipated in Q4 and Q1, with refinery maintenance ending and increased exports.

• No newbuildings on order, resulting in $0 newbuild capex.