Tsakos Energy Navigation Q1 2025 Earnings Report

Tsakos Energy Navigation EPS Results

• Actual EPS: $0.92
• Consensus EPS: $0.29
• Beat/Miss: Beat by +$0.63
• One Year Ago EPS: $1.05

Tsakos Energy Navigation Revenue Results

• Actual Revenue: $153.51 million
• Expected Revenue: $154.01 million
• Beat/Miss: Missed by -$505.00 thousand
• YoY Revenue Growth: N/A

Tsakos Energy Navigation Announcement Details

• Quarter: Q1 2025
• Date: 6/17/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, June 17, 2025
• Conference Call Time: 10:00AM ET

Tsakos Energy Navigation (NYSE:TEN). engages in the provision of seaborne crude oil and petroleum product transportation services. Its activities include the operation of crude tankers, product tankers, and liquefied natural gas carriers. The company was founded by Nikolas P. Tsakos and Michael Gordon Jolliffee in July 1993 and is headquartered in Athens, Greece.

Tsakos Energy Navigation Q1 2025 Earnings Call Transcript

Key Takeaways

• TEN has secured a backlog of approximately $3.7 billion in committed revenue across long-term charters, covering 83% of its fleet and averaging 12.5 years of contracted employment.
• In Q1 2025, TEN reported net income of $37.7 million (EPS $1.04), adjusted EBITDA of $99.3 million, and declared a 60 ¢ per share dividend for shareholders of record on July 14.
• The fleet renewal program is under way with 21 newbuilds in progress; management has sold 14 older vessels (avg. age 17.3 years) and replaced them with 30 modern vessels (avg. age <1 year), including six dual-fuel LNG tankers and nine high-spec shuttle tankers for Brazil.
• Management argues the stock trades at roughly 30% of NAV (~$20 vs NAV >$60), advocating an EV/EBITDA valuation to reflect TEN’s industrial model of stable, rolling income streams rather than a static NAV metric.
• TEN plans to divest at least six older vessels by year-end to unlock ~$100 million of net cash, which will support higher dividends, debt reduction, and further growth without issuing new equity.

Presentation

[Operator]

Thank you for standing by, ladies and gentlemen, and welcome to SACRO's Energy Navigation conference call on the first quarter twenty twenty five financial results. We have with us today Mr. Takis Arapoglou, Chairman of the Board Mr. Nicholas Sacco, Founder and CEO Mr. Paul Durham, Chief Financial Officer Mr. George Saroglu, President and Chief Operating Officer Mr. Harry Kosmatos, Co CFO of the company. Only I must advise that this conference is being recorded today. And now I'll pass the floor over to Mr. Nicholas Buenozzi, president of Capital Link and investor relations adviser to Tacos Energy Navigation Ltd. Please go ahead, sir.

[Nicolas Bornozis, Founder, President & CEO at Capital Link]

Good morning, and thank you very much. Good morning to all of our participants. I am Nicholas Bornovis, president of Capital Link and Investor Relations Advisor to Tacos Energy Navigation. This morning, the company publicly released its financial results for the first quarter ended 03/31/2025. In case you do not have a copy of today's earnings release, please call us at (212) 661-7566 or email us 10@capitalm.com, and we will have a copy for you emailed right away.

[Nicolas Bornozis, Founder, President & CEO at Capital Link]

Please note that prior to today's conference call, there's also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.temn.gr. The conference call will follow the presentation slides, so please, we urge you to access the presentation slides on the company's website. Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, note that the slides of the presentation are given control, and that means that by clicking on the proper button, you can move to the next or to the previous slides on your own. At this time, I would like to read the Safe Harbor statement.

[Nicolas Bornozis, Founder, President & CEO at Capital Link]

This conference call and slide presentation of the webcast contain certain forward looking statements within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward looking statements involve risks and uncertainties, which may affect Penn's business prospects and results of operations. And before I pass the floor over to the Chairman, please let me wish a belated birthday to doctor Tsakos and his wife, Celia. And I understand that you had a very special birthday gift being in Korea and taking care of the delivery of the Svetlana Svetlana tanker, doctor Irene Takos. That vessel bears your mother's name, and the vessel will have the Greek flag.

[Nicolas Bornozis, Founder, President & CEO at Capital Link]

And also, you have at the same time the naming of the sister vessel, Surya t, which will bear your wife's name. So it has been a very special moment in the company's history, and I'd like to congratulate you. And with this, I will pass the floor to mister Arapoglu, the Chairman of TRACoS Energy Navigation. Mr. Arapoglou, please go ahead.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

Thank you. Thank you, Nicolas. Good morning. Good afternoon, everyone. Thank you again for joining us today in our call reporting our Q1 results.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

That's another quarter of excellent financial results driven by the usual superior operating track record of 10, supported, of course, by strong market fundamentals. This allows ten to continue rewarding shareholders with a healthy dividend as it has been doing continuously since inception. As you've read in the press release, TEN has built a continuously and continuously grows on a rolling basis, a stream of high quality committed future income of currently approximately 3,700,000,000.0 spanning over a number of years through long term accretive charters of a substantial part of this fleet, which ensures profitability, limit volatility, and provide greater predictability in its earnings. At the same time, of course, TEN continuously renews the fleet with modern state of the art vessels through an unprecedented in size 21 vessels now being built and and and selling our old stock tonnage. You would agree that this is not the typical more sensitive model of shipping companies protecting them against market shortcomings.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

Yet, we believe that all these positive characteristics of the 10 industrial model are not reflect properly reflected on our stock price, which is being valued in the same way as other companies in the sector with much less robust attributes. This is perhaps because most followers of the sector have a much shorter time horizon than our industrial model deserves. We hope that investors will focus on this and upgrade their valuation of our stock. I'll I'll leave you to reflect on this and congratulate again, Nikos Tarkos and his team for the excellent results and wish them more of the same. So thank you, and over to you, Nikos.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Thank you, chairman, and good morning, good afternoon to to all of you that are following our first quarter of twenty twenty five results. As the chairman said, it has been a a solid period. We are navigating literally in very turbulent waters around the world, more for geopolitical events. I mean, the beginning of the year has been a wave of uncertainty as far as business our business possibilities. A lot of talk about tariffs, a lot of talk about extra extra port costs, a lot of talk about protectionism.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And, of course, now this very unsettling situation that is escalating in The Middle East that I think cannot cannot make anybody happy. However, we have been able to navigate the the turbulent waters again successfully, safely, and and profitably for the majority of course. Our main profitability is important, but the safety of our crew and the people onboard their ships is even more important. And we have had another good run and safe run on this segment. Regardless of the uncertainties, the underlying market conditions are strong.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

It is very hard for us and our chartering team to maintain any vessels in the spot market. There is a huge demand for taking even older ships, and I I will give you examples which I haven't seen in my thirty plus years in business. Any any of our ships can be chartered, you know, anywhere up to ten to fifteen years, even older older good quality ships that we operate as as I'm sure you know. And, I mean, we have one of our oldest or if not our oldest ship, even older than than my twin daughters, keeps on being targeted by one of the big major oil companies year after year. I think she is right now on her twenty twentieth extension, and she's 23 years old.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And she's extended for another six option six months. And that shows that a good quality operator that provides a good service age is not important as as the quality of the assets. So the environment is good. The company is going through its its largest growth until the next one because that was something we were saying a couple of years ago when we sold 14 of our first generation ships and ordered another 17. We're actually now at the 21 new buildings, two of them just delivered last week.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Thank you, Nick, for your wishes on this very milestone occasion. And yes. And and we are looking at other opportunities. There are segments that we are right now underinvested like the VLCCs and always looking at good quality Korean or Japanese vessels as a priority. And perhaps we will come up with some surprises later in the in the following quarters on that.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And and with this, I will ask our president to give us a a quick overview of what we have done up to now. And, you know, I think the the things to remember, the our share price is being treated as well together with the with the other companies. So we went down from our $30 $31 one year high to almost half of that. We're making some progress, but our net asset value without 3,700,000,000.0 of of future business is in excess of $60 So we are we are really, really in in undervalued territory here and and a good opportunity. But we've been penalized together with the rest with the rest of the market and the nervousness.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

29 vessels have been extended or new businesses within the first six months of the year. So that's 29 out of the 62 vessels in the water. So half of the fleet has been extended for a very long period of time. And we have reached, according to Paul Dharibault, our CFO, and presented the future revenues going forward of 3,700,000,000.0 US dollars. So I think these are serious numbers.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

We announced still a healthy dividend, and, hopefully, we'll be able to maintain and improve that increase that going forward. And, George, tell me, how are the prospects for that?

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

Thank you, Nikos. We are very pleased to report today another profitable quarter. We continue to operate in a very good freight market environment.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

Energy majors continue to approach our company for time charter business. And as Mr. Tackles mentioned, since the start of the year, we have had 29 new time charter fixtures. Total fleet contracted revenue, the backlog as of today stands approximately at 3,700,000,000.0 We have built in ten one of the largest transporters of energy in the world. We have started with four vessels back in 1993, and we have turned every crisis the world and shipping has faced into a growth opportunity.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

We now have a pro form a fleet of 82 vessels, thanks to the company's crisis resistant model. And during these 32, we have combined self generated cash, traditional bank lending and countercyclical capital market fundraising in order to build the corporate fleet. The fleet today is modern, diversified and versatile, covering both the conventional and specialized transportation requirements of our clients, which are mainly the major oil companies, blue chip names with global reach. In Slide five, we list the pro form a fleet of all conventional tankers, both cruise and product carriers. The red color shows the vessels that trade in the spot market and our new buildings under construction, especially when you see them instead of a vessel name, the ticker NBPN.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

With light blue, we have the vessels that are on time charter with profit sharing and with dark blue, the vessels that are on fixed rate time charters. In the next slide, we list the pro form a diversified fleet, which consists of our two LNG vessels and our 16 vessel shuttle tanker fleet. We are one of the largest shuttle tanker operators in the world following the recently announced deal with Transpedro in Brazil for nine high specification shuttle tankers to be built in the Samsung shipyard in South Korea. We have five shuttle tankers in full operation after taking a recent delivery of A320-four, which commenced a long time charter to an energy major. If we combine the two slides and account only for the current operating fleet of 63 vessels, 29 or 46% of the operating fleet has market exposure, that is spot related rates and time charter with profit sharing.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

While 52 vessels or 83% of the fleet is in secured revenue contracts that is fixed time charter and time charter with profit sharing. The next slide has the client with whom we do repeat business through the year, thanks to our industrial model. ExxonMobil is the largest revenue client Equinor, Dell, Chevron, Total Energy and BP Follow. We believe that over the years, we have become the carrier of choice to energy major, thanks to the fleet that we built, the operational and safety record, the disciplined financial approach and the strong balance sheet and financial performance. The next slide presents from the breakeven cost for the various vessel types we operate in the company.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

And as we have said many times, our operating model is simple. We try to have our time charter vessels generate revenue to cover the company's cash expenses and let the revenue from the spot trading vessels contribute to the profitability of the company. Thanks to the profit sharing element for every $1,000 increase in spot rates, we have a positive $0.17 impact in annual earnings per share based on the number of 10 vessels that currently have exposure to spot rates. We have a solid balance sheet with strong cash reserves. The fair market value of the fleet is $3,600,000,000 against approximately $1,700,000,000 of debt, and net debt to cap currently stands around 40%.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

Fleet renewal has been key to our operating model. Since January one of twenty twenty three, we have further upgraded the quality of the fleet by divesting from first generation conventional tankers, replacing them with more energy efficient new buildings and more than secondhand tankers, including dual fuel vessels. In summary, we have sold 14 vessels with an average age of seventeen point three years and deadweight capacity of 1,200,000 deadweight ton and replaced them with 30 contracted and more than acquired vessels with an average age of less than a year and 3x the deadweight capacity of the vessels we sold. We continue to transition the fleet to greener and dual fuel vessels. We are currently one of the largest owners of dual fuel LNG powered aftermarket tankers with six vessels in the world.

[George Saroglou, COO, President & Executive Director at Tsakos Energy Navigation]

Global oil demand continues to grow year after year. Wars and geopolitical events positively affect the tanker market and freight rates and the order book remains at healthy levels as a big part of the global fleet is over twenty years and needs to be replaced. And with that, I will pass the floor to Harry Sorgmatos, who will walk us through the financial performance for the third quarter. Harry?

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Hello?

[Operator]

Hello. Do you already could you please check if you sorry. Okay.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Hello? Yes. Hi.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Thank you, George. Thank you. Thank you, George, for touching on the major point of the I think we need to highlight. And with this, I will just go over a brief overview of the financials that we presented earlier today. So during the first quarter of twenty twenty five, TEN operated just about 62 vessels, one over the equivalent twenty twenty four period and 50 fleet employment more towards secure revenue contracts to capture the increased appetite from all major to lock their long term and protectiveness.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

As a result, TENS exposure to past contracts increased from about 73% in the first quarter of twenty twenty four to 80% in the third quarter of twenty twenty five. By contrast, the fleet's pure spot exposure between the 2024 and twenty twenty five first quarter period declined from 19% to about 18%. Despite this recalibration of flipping payments to conform the central industrial approach to shipping, central ability to maintain a notable presence in the still healthy strong market with actually enhanced as emphasis was placed on profit sharing contracts, which when combined with spot features increased the fleet's ability to capture market fit from 44% in last year's first quarter to 47 in this in this year's quarter. Staying on trade dynamics, during the first quarter of twenty twenty five, two vessels under one scheduled dry docket compared to five in the twenty twenty four first quarter, ensuring a near maximum fleet utilization of 97.2%. Resulting from the above, the larger fleet, the higher fleet utilization, and the increased base in the fuel revenue contract, somewhat neutralized and earning pressure, the top of spot market earlier in the year may have created.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Our tenth fleet generated 197,100,000.0 in gross revenue, a little under the $2,201,500,000.0 in the first quarter of twenty twenty four. The average time charter equivalent per fee per day that corresponds to this performance was at the COP $30,741. Vessel expenses on the other hand and in line with 10 calculated lower exposure and spot rates during the twenty twenty five first quarter experienced a 6,000,000 decline from last year's first quarter and settled up 36,000,000. Vessel operating expenses, however, due to the sum of larger fleets, were 49,600,000.0 compared to 48,600,000.0 in the first quarter of twenty twenty four or $9,502 per seat per day. The level contained thanks to the efficient and cost of management of 10 technical managers.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

A similar pattern was evident for both depreciation and amortization expenses, which increased from 37,500,000.0 in the first quarter of twenty twenty four to 41,000,000 in the first quarter of twenty twenty five, all assisted by the introduction of larger and more high value assets. During the first quarter of twenty twenty five, a sale of the 2,009 bill to as much as the centrogram generated capital gains of 3,600,000.0 compared to capital gains of 16,200,000.0 in the first quarter of twenty twenty four. Net of this gain, 10 during the first quarter of twenty twenty five, 10 operating income was at 57,100,000.0 compared to 60,100,000.0 in the twenty twenty four first quarter. Interest and finance cost declined by 1,100,000.0 to 24,000,000 as a result of lower debt obligations and somewhat lower interest rates compared to the twenty twenty four first quarter. Reflecting on the above, a net income of $37,700,000 the first quarter of twenty twenty five, leading to a earnings per share of $1.04.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Adjusted EBITDA for the first quarter of twenty twenty five, a quarter with soft spot rate, was at 99,300,000.0, almost identical to the 100,500,000.0 in last year's strong spot rate per quarter. Total debt was reduced to $1700000000.040400000.0 lower from the twenty twenty four first quarter level, while debt to capital also fell to a comfortable 40.6%. Total bank for the first quarter of twenty twenty five, after 27,000,000 in preferred coupon and 238,000,000 of principal payments to banks, including payment for financing arrangements, were 350,000,000, 6,000,000 higher from the top level at the end of the twenty twenty four first quarter. And in lending, and reflective of this positive performance, Penn will distribute to common shareholders a first semiannual dividend of 60¢ per share to shareholders of record on 07/14/2025. And with this, I'll pass it back to Lito. Thank you.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Harry, thank you for for your very to the point and accurate presentation. And I think as we we said, it has been the beginning of this year has been very peculiar and turbulent year starting with the restriction of shipping. And as we usually say, our aim is we are the truck drivers of the season. We need open open roads and not the protection and not tolls. And on top of this, the recent intensified geopolitical turmoil is is putting I mean, it's putting us literally to navigate very turbulent waters, which I think we have been successfully and profit profitability doing.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And looking on on that tanker market and the majority of the crude trades, there's huge demand for for more for more business. As as we have said, it has been a very strong year of expansion. This is our largest expansion until our next one. And we're looking to still grow to segments that we have not grown up yet for good reasons like the VLCC and the LNG. The market environment is positive.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

A lot of demand we have our chartering department has to try and and keep some ships on the spot market. There's huge demand even for all the ships, as I mentioned, The example of our 2,003 vessel, which has been continuously chartered with one of the major oil companies since their inception, which is a very good proof for our technical managers from the, you know, the way we operate the ships and the trust that that we are able to share with the with the oil companies. So overall, an unsettling period for the world, but something that we keep under control, at least for our side of the business. We have been able to combine as a chairman earlier said, and I present the growth in the support now. I'm just putting on the on the slides over the years and growth and strength over the crisis and strong dividend payments and debt reduction.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And with this, I would like to open the floor. If there are any questions, please, we're here to answer.

[Operator]

Thank you. We will now be conducting a question and answer session. Our first questions come from the line of Poe Fratt with Alliance Global Partners. Please proceed with your questions.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

Hello. Can you just highlight what the second quarter new build cost will be? I'm looking at roughly 130,000,000. Is that in the ballpark for the second quarter, you know, new build payments?

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Hello? Can you hear me?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Yes.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Hello. So for the second quarter of of twenty five, we have one of our d p twos that will will be coming into the fleet. This vessel has the only the only cost is just under 130,000,000, and we expect to to pay approximately approximately 17,000,000 remaining for that quarter out of bankruptcy, and the rest have been have been arranged through Saint Valena's commercial commercial bank debt.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

We also have to pay a second installment, the second 5% installment on the nine new buildings, the nine d c two sub suburb countries of about 67,000,000, but but that will make the second half of the payment that we are required to make. Until the delivery of the best vessel, we'll not make any other payment on that because we are looking into getting predelivery financing on those vessels as well. And also, we expect one of the conventional field markets, the CFT, to be delivered in the next in in in the next quarter. And and again, this has advised somewhere in the in the mid in in the mid eighties, and we're looking to we're looking to raise somewhere between 70 to 8% financing. We're very close to doing that, and the the rates will be the expected paid out of our our customers.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

So it become more or less what we have scheduled currently for for the next quarter as regards to the new bookings.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

Okay. That's and just to clarify, so the the the 67,000,000 on the shuttle tankers will fall into the second quarter, not the rest of the year. So that's a second quarter event, Harry?

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

They are scheduled for July for July.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

The third quarter. Okay. And then when you, know, Niko, you talked about, you know, that you're underrepresented or you don't have as much exposure to VLCCs and where we should stay tuned. My impression is that the bid ask in the S and P market is still, you know I guess, could you characterize how the bid ask is in the S and P market right now, especially for beef since you mentioned beef?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

We are always looking to build ships against clients. We just send our and, of course, when opportunities arise. I mean, our first step is to build good quality Korean or Japanese ships. And when and there are not many of them out there. So when we get an opportunity, it's something that we seriously look.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

As you look at our fleet, we only we're down to three deals. And I think for a company that will be close to 96 before the you know, in a pro form a basis, we need to increase these segments in in the market. And we're looking at opportunities out there. We have seen, and I think we have been able to find a good reduction of the new building prices from top yards, and this is what we are looking to take advantage of.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

Okay, great. And then you did sell in the first quarter a 2,009 Suezmax. Can you just sort of help me understand sort of your fleet strategy as far as are you going to continue to sell older assets as you see decent bids out there? Or is your fleet going to stay roughly flat with the new builds increasing the fleet over time?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

I mean, we are always we are always taking advantage of the S and P market in renewing the fleet. I think we we are looking to to sell at least half a dozen ships from now to the end of the year. We are very close in three or four transactions that might take place before before the fourth quarter, which will release close to a 100,000,000 of net cash flow. And, of course, it will, you know, enhance our ability to pay dividend, reduce debt, and at the same time, would not affect our strong cash balances in when we grow the business for further expansion.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

Okay. And I I know it's probably hard at this point in time. Can you give us an outlook for the dividend, the second second half dividend that you typically pay in December?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Well, I mean, I I cannot because this is taking our strategy meeting is taking place every October in Greece, and that's when people sit under the sun and decide having some wine on the dividend. But joking apart, we hope to have at least a similar dividend to the first half to say the least.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

Great. That's helpful. And then you did highlight that, your NAV is, you think, north of $60 The stock's a little bit under $20 So it's at a 35% it's trading at 35% of NAV. Is there anything that you think that you should do to help close that gap? Or should we just, you know, I guess, just is there anything that you corporate actions wise, you can take to help close that gap?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Well, I think I think what we we have to do is to try as the chairman. I think the chairman, perhaps, can arrange at the end of the of this. He can give us, again, the same presentation is that to to present the difference of 10, which has an industrial model proven for thirty years than the other shipping companies that go are more fluctuating. I mean, this is we still have a we still have a small flow of of shares, including the inner you know, the the management and the family. So if if someone were there to do a buyback, it would be completely dilute even more the the free flow.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

So I think we are looking for various scenarios where people will understand the value of the company. One of them would be, and we've been discussing going forward, some sort of spin off of the of the LNG and shuttle tanker fleet that has a huge a huge cash flow for the next with an average of twelve and a half years. That's, of course, that would be able to help also the mother company. But these are still discussions we're internally having. We don't have to do anything for the next couple of years.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

The company has a lot of liquidity. There's no need to raise to raise capital. It just, yeah, needs to become to make the point more evident.

[C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners]

That's an interesting concept. Thank you so much.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Thank you.

[Operator]

Thank you.

[Operator]

I'm not showing any further questions at this time. I would now like to hand the call back over to mister Nicholas Staphos for any closing remarks.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Well, I mean, you you guys appeared, you know, too much from my side. It has been as a an exciting first six months, and, hopefully, we can make the remaining of the year exciting. We we wish for everybody to have a peaceful summer, although it doesn't look very likely. But we hope everybody would be able to make sense of what's happening and and have a much more peaceful environment that we operate now. And with that, I will ask our chairman to mister Takis Arapoglou to close our presentation. Takis.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

Thank you. Thank you, Nikos. On the question of closing the gap on on on the price to NAV and, you know, the the mention of a buyback, I I would rather pay people to stay through dividends than pay them to leave. I I I think that I think that that I hope investors would understand the value of the stock and treat it differently to your usual other shipping assets in the market, which behave and trade in different ways.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

We provide, you know, an almost stable stream of income going forward, which is not a one off. It's being rolled year after year with additional transactions, and this provides a different environment in which we operate. And and I hope that investors will understand the distinction.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

So that's that's it for me for now. Thank you.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Thank you, chairman. Well, think just again not to and this is more for our for the analysts. I think our type of of operation, which is much much more industrial, and it has a proven record of 32 consistently for the year's dividend and growth, is not this should not be measured on net asset value. I think net net asset value is is completely for companies that have no operation. I mean, we have 3,700,000,000.0 with an average twelve point five years of forward forward income, fixed as a minimum.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

To make it to make everybody feel very, very young, we have a hundred and eighty years of fixed employment for all our ships, which means I think even our great grandchildren might be there to receive some of the the dividends at the end of the period. So the model of net asset value, which actually takes a ship that might be empty and just sitting in the middle of the ocean with no cargo and giving the same value of the ship that has a fifteen or ten year, it's it's it's a wrong or or at least it's not representative of what we do. I think we should be looking to measure doing EBITDA multiples like, or earning mark markets. And right now, if if we look I mean, we're measuring the two or three times EBITDA margins when we should be measuring the three times EBITDA margins. And and that's what we're going to try and make better through the spin off, and that's the only reason we might be doing a spin off is to prove the the point.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

It's not because the the company is actually you're putting aside close to $500,500,000 of cash on a daily basis after all our expenses. So the last thing we need is to is to raise to raise equity. We will just pay pay dividend, grow, and and reduce debt. And, again, with that, I would like to with that thought, I would like to let our analysts think a bit and perhaps start measuring companies like ours a bit on that measure rather than on net asset value.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

And and then And, of course, Nikos, if if I may if I may interrupt Nikos?

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Yes, please.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

Sorry. And also if you look at if you take last year's dividend, then perhaps we will not be that far this year at the present level of our stock price, we're talking about an 9% dividend yield, which is not something that you find in in the sector often. So and and this this is the proof of the model, really, if you look at it. So they're relatively, you know, limited payout.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

So I think what Nico said is correct. Net asset value is a very static model. We don't run a static business, and EBITDA is the best indicator of of the performance of the fleet. Thank you.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

Thank you.

[Nikolas Tsakos, Founder, CEO & Executive Director at Tsakos Energy Navigation]

And all the best for the remaining of the year. Our team is is in New York. I know you guys are having a very nice lunch. I presume, I hope, at a Greek restaurant sitting outdoors very, very soon. Send us some picture and and and a doggy and a doggy bag for us. Thank you.

[Efstratios Arapoglou, Chairman at Tsakos Energy Navigation]

Take care. K. Bye bye.

[Theoharrys Kosmatos, Co-CFO at Tsakos Energy Navigation]

Thank you, everyone. Thank you. Bye bye. Bye bye. Bye.

[Operator]

This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of the day.

Participants

Executives

• Efstratios Arapoglou, Chairman
• Nikolas Tsakos, Founder, CEO & Executive Director
• George Saroglou, COO, President & Executive Director
• Theoharrys Kosmatos, Co-CFO

Analysts

• Nicolas Bornozis, Founder, President & CEO at Capital Link
• C.K. Poe Fratt, MD - Equity Research & Senior Transportation Analyst at Alliance Global Partners