The following is a summary of the Teekay Tankers Ltd. (TNK) Q1 2024 Earnings Call Transcript:
Financial Performance:
Teekay Tankers reported increased total adjusted EBITDA of $151 million, up from $127 million in the previous quarter.
Adjusted net income rose to $132 million or $3.86 per share, from $100 million or $2.91 per share in Q4 2023.
The firm declared a fixed quarterly cash dividend of $0.25 per share for Q1 2024, plus a special dividend of $2 per share, totaling total cash dividends of $4.25 per share since updating their capital allocation plan.
They bought back the remaining eight vessels on sale leaseback arrangements for $137 million making the company debt-free.
Business Progress:
Teekay Tankers utilised their high operating leverage to generate substantial earnings with Q1 2024 spot rates hitting the second highest in company history.
The extension of the Trans Mountain pipeline is expected to increase Aframax demand, boosting Aframax spot tanker rates.
Tanker supply and demand fundamentals appear positive for the medium term, driven by increased oil demand, more crude oil supply in the Atlantic Basin, and exports from the expanded Trans Mountain Pipeline.
The company sold a 2004-built Aframax in Q1 for $23.5 million, recording a gain on sale of $11.6 million.
They aim to continue investing in fleet rejuvenation.
Teekay anticipates potential market shifts due to changes in oil dispatching in North Asia, leading to increased demand for Aframax ships.
They are considering the purchase of secondhand ships to compensate the loss of spot exposure due to the recent sale.
More details: Teekay Tankers IR
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