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Tsakos Energy Navigation Limited – TNP – Full Year 2011 Results

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Tsakos Energy Navigation Limited (NYSE: TNP) reported results  unaudited for the year 2011 and fourth quarter of 2011.

FULL YEAR 2011 RESULTS

TNP Revenues, net of voyage expenses and commissions, in 2011, totaled $253.7 million in a very difficult market environment.


In the same period, TEN operated an average of 47.8 vessels.  The average daily time charter equivalent rate per vessel was $16,047.

TNP Daily operating expenses per vessel were $7,606, a decrease of 0.5% from 2011.

The combined daily operating expenses and overhead expenses (mainly management fees and general and administrative expenses) per vessel have effectively remained stable over the past year due to cost reduction efforts and disposal of older vessels.

TNP Interest and finance costs fell significantly in 2011 to $53.6 million, due to favorable nonhedging interest rate swap valuations and cash received on bunker swaps amounting to $6.4 million.

Total interest paid on all interest rate swaps amounted to $34.8 million. Over half these swaps are due to expire in the second half of 2012.

Within the year, 16 new charters (including profit sharing) were concluded with minimum gross revenues of $1.1 billion and average duration of 3.1 years.

Two vessels, the 1991 and 2001 built aframaxes Vergina II and Opal Queen were sold for a capital gain of $5.0 million which released $18.2 million cash after debt repayment.

Savings from the sale of the Vergina II have been estimated at $4 million in operational, financing and (scheduled) dry-docking costs during 2011.

The VLCCs La Madrina (1993-built) and La Prudencia (1994-built), after a long period of profitable fixed employment incurred combined losses of approximately $21 million (before the impairment charge) in 2011, much due to lengthy repositioning voyages in the year.

Due to the continuous poor market and lack of economically viable opportunities for the foreseeable future for older VLCCs, it was decided that these two vessels should be sold and action has been taken accordingly from December. As a consequence, the vessels have incurred impairment charges amounting to $39.4 million in total. The vessels are accounted for as heldfor- sale in the balance-sheet.

2011 Highlights

  • Voyage revenues of $395.2 million
  • Combined adjusted EBITDA and vessel sales proceeds at $146.9 million
  • Daily operating costs per vessel further reduced in 2011
  • $1.7 million in operating income (adjusted to exclude impairment charges)
  • Impairment charges of $39.4 million relating to two VLCCs considered as held-for-sale
  • Net loss $89.5 million after impairment of $39.4 million
  • Delivery and long term charter for 11 and 12 years with profit-share for two new
  • building suezmaxes
  • 15-year contracts and construction of two suezmax DP2 shuttle tankers
  • Accretive LNG re-charter and new LNG opportunities pursued
  • 16 new charters with major end-users
  • Significant outperformance of 2011 spot market indices due to Company’s T/C strategy
  • 37 vessels out of a pro-forma fleet of 50 under secured employment
  • Maintained strong liquidity of $185 million
  • Constant quarterly dividend payments. Total dividends paid since 2002 NYSE listing of
  • $9.225 per share (approx. $354 million distributed)
  • Fleet utilization of 97%
  • Sale of two tankers for a total net gain of $5.0 million
  • Fleet average age 7.0 years

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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