Scorpio Tankers Inc. (NYSE: STNG) (“Scorpio Tankers” or the “Company”) on August 5, 2021, reported its results for the three and six months ended June 30, 2021. The Company also announced that its Board of Directors has declared a quarterly cash dividend of $0.10 per share on the Company’s common stock.
Results for the three months ended June 30, 2021 and 2020
For the three months ended June 30, 2021, the Company had a net loss of $52.8 million, or $0.97 basic and diluted loss per share.
For the three months ended June 30, 2021, the Company had an adjusted net loss (see Non-IFRS Measures section below) of $51.1 million, or $0.94 basic and diluted loss per share, which excludes from the net loss $1.6 million, or $0.03 per basic and diluted share, of losses recorded on the transaction to exchange $19.4 million in aggregate principal amount of the Company’s existing Convertible Notes due 2022 for $19.4 million in aggregate principal amount of new Convertible Notes due 2025, described in detail below.
For the three months ended June 30, 2020, the Company had net income of $143.9 million, or $2.63 basic and $2.40 diluted earnings per share.
For the three months ended June 30, 2020, the Company had an adjusted net income (see Non-IFRS Measures section below) of $144.3 million, or $2.63 basic and $2.40 diluted earnings per share, which excludes from net income a $0.3 million, or $0.01 per basic and diluted share, write-off of deferred financing fees.
Results for the six months ended June 30, 2021 and 2020
For the six months ended June 30, 2021, the Company had a net loss of $115.2 million, or $2.12 basic and diluted loss per share.
For the six months ended June 30, 2021, the Company had an adjusted net loss (see Non-IFRS Measures section below) of $108.3 million, or $1.99 basic and diluted loss per share, which excludes from the net loss $5.5 million, or $0.10 per basic and diluted share, of losses recorded on the transaction to exchange the Company’s existing Convertible Notes due 2022 for new Convertible Notes due 2025, described in detail below, as well as a $1.3 million, or $0.02 per basic and diluted share, write-off of deferred financing fees related to the refinancing of certain credit facilities.
For the six months ended June 30, 2020, the Company had net income of $190.6 million, or $3.48 basic and $3.21 diluted earnings per share.
For the six months ended June 30, 2020, the Company had an adjusted net income (see Non-IFRS Measures section below) of $190.9 million, or $3.49 basic and $3.21 diluted earnings per share, which excludes from net income a $0.3 million, or $0.01 per basic and diluted share, write-off of deferred financing fees.
Summary of Second Quarter and Other Recent Significant Events
Below is a summary of the average daily Time Charter Equivalent (“TCE”) revenue (see Non-IFRS Measures section below) and duration of contracted voyages and time charters in the pools (excluding voyages outside of the pools) for the Company’s vessels thus far in the third quarter of 2021 as of the date hereof (See footnotes to “Other operating data” table below for the definition of daily TCE revenue):
Below is a summary of the average daily TCE revenue earned by the Company’s vessels in each of the pools (excluding voyages outside of the pools) during the second quarter of 2021:
In August 2021, the Company agreed to acquire a minority interest in a portfolio of nine product tankers, among which are five dual-fuel MR Methanol tankers (built between 2016 and 2021). These five vessels carry Methanol as well as traditional petroleum products, and they are powered either by Methanol or by traditional marine fuels.
In June 2021, the Company completed the exchange of $19.4 million in aggregate principal amount of the Company’s Convertible Notes due 2022 for $19.4 million in aggregate principal amount of Convertible Notes due 2025 (the ‘Exchange Notes’) pursuant to separate, privately negotiated, agreements with certain holders of the Convertible Notes due 2022. Simultaneously, the Company issued and sold $42.4 million in aggregate principal amount of Convertible Notes due 2025 in a private offering (the ‘Purchased Notes’ and together with the Exchange Notes, the ‘New Notes’). The New Notes issued in this transaction have the same terms (other than date of issuance) as and are fungible with the Convertible Notes due 2025 that were issued in March 2021.
In January 2021, the Company entered into a note distribution agreement with B. Riley Securities, Inc., as sales agent, pursuant to which the Company may offer and sell, from time to time, up to $75.0 million of additional aggregate principal amount of its 7.00% Senior Unsecured Notes due 2025 (the “Senior Notes due 2025”). Since April 1, 2021 and through the date of this press release, the Company issued $23.0 million aggregate principal amount of additional Senior Notes due 2025 for aggregate net proceeds (net of sales agent commissions and offering expenses) of $22.5 million. There is $37.9 million of remaining availability under the this program as of August 4, 2021.
The Company is in advanced discussions with certain financial institutions to further increase its liquidity by up to $59.1 million in connection with the refinancing of 13 vessels.
The Company also has $20.0 million of additional liquidity available (after the repayment of existing debt) from previously announced financings that have been committed. These drawdowns are expected to occur at varying points in the future as these financings are tied to scrubber installations on the Company’s vessels.
The Company has $268.6 million in cash and cash equivalents as of August 4, 2021.
Investment in Dual Fuel Tankers
In August 2021, the Company agreed to acquire a minority interest in a portfolio of nine product tankers, consisting of five dual-fuel MR Methanol tankers (built between 2016 and 2021) which, in addition to traditional petroleum products, are designed to both carry methanol as a cargo and to consume it as a fuel, along with four ice class 1A LR1 product tankers. The dual-fuel MR Methanol tankers are currently on long-term time charter contracts greater than five years. The Company acquired 6% of the outstanding shares in this venture for $7.2 million.
About Scorpio Tankers
Scorpio Tankers is a leading international provider in the transportation of refined petroleum products. The Company’s fleet consists of 131 wholly owned, finance leased or bareboat chartered-in tankers (42 LR2, 12 LR1, 63 MR and 14 Handymax). Scorpio Tankers is a publicly listed company and trades on the New York Stock Exchange under the ticker “STNG”.