EMEA News
Surging Tanker Market Leads to Gains for Greek Player
Greece-based Tsakos Energy Navigation Limited (TEN) [NYSE: TNP] reported that it has more than doubled its profit in the first quarter of 2015 as low oil prices continue to push down bunker costs and drive up crude tanker rates.
Net income rose 156 percent to $37.3 million from $14.6 million the year before, while revenues rose to $148.9 million from $130.3 million.
According to reports, earnings per share (EPS) also beat expectations, with TEN reporting $0.42 compared to the consensus of $0.36.
"The crude tanker market continues its solid footing fuelled by low oil prices, scarcity of available tonnage, increased oil supplies and the establishment of new and longer trade routes which
positively impact worldwide vessel utilization," TEN said.
A number of major financial institutions have favourably rated the company's shares this month, with JPMorgan Chase & Co. having initiated coverage with an "overweight" rating and Credit Suisse having upgraded its outlook to "outperform."
“The first quarter results and the continuous market strengths give us confidence for a very
profitable 2015," said TEN CEO Nikolas P. Tsakos.
"Looking ahead, the existing supply-demand equilibrium together with the low price of oil enforces our belief that we are in the midst of, finally, a long term up-cycle in the tanker industry.”
The company said that out of the average of 50 ships it operated in the quarter, 23 are on spot contracts and 10 are under profit-sharing arrangements, with fleet utilization at 99.3 percent.
The positive performance means that TEN is now looking for growth opportunities, the company said, along with considering divesting its first-generation tankers to maintain the fleet's young-age profile.
Last month, shipping analysts described the tanker market in 2015 as off to a "stellar" start, having likened the excess crude in the market to a "steroid shot."
