MONACO - Scorpio Tankers Inc . (NYSE:STNG), a major player in the transportation of petroleum products, has disclosed details about its ongoing securities repurchase program and provided an update on its second-quarter daily Time Charter Equivalent (TCE) revenues. The company has recently bought back 641,654 of its common shares at an average price of $78.26, leaving $199.8 million available for further repurchases under the 2023 program as of last Thursday.
In its second quarter of 2024, Scorpio Tankers has reported estimated average daily TCE revenues for its fleet. The LR2 class vessels are expected to bring in an average of $55,000 per day, with 81% of the quarter's revenue days accounted for. The MR tankers are estimated at $37,000 daily, covering 88% of the quarter's days. The Handymax vessels are forecasted to earn $28,000 daily, with 80% of the days contributing to the quarter's revenue.
TCE revenue is a non-IFRS measure that is widely used in the shipping industry to compare performance irrespective of charter types. It is calculated by deducting voyage expenses, including bunkers and port charges, from vessel revenues. Expected Revenue Days are calculated by subtracting the total number of days anticipated for major repairs or drydockings from the total calendar days in the quarter, representing the total days a vessel is expected to earn revenue.
The company, which currently owns or leases finances 108 product tankers, has also announced agreements to sell six MR tankers, expected to close in the third quarter of 2024. This move is part of Scorpio Tankers' strategy to optimize its fleet size and composition.
The information provided in this article is based on a press release statement from Scorpio Tankers Inc.
In other recent news, Scorpio Tankers Inc. reported strong financial results for the first quarter of 2024, with a year-over-year increase of 20% in adjusted earnings per share to $3.97, surpassing both BofA Securities' estimate and the consensus estimate. The company also achieved an adjusted EBITDA of $293 million and an adjusted net income of $207 million. Following these results, BofA Securities raised its stock price target for Scorpio Tankers from $76 to $82, maintaining a Neutral rating.
Scorpio Tankers further announced plans for a substantial unscheduled loan repayment of $223.6 million in June 2024, approved by its majority lenders. The company expects this strategic financial move to reduce its daily cash break-even rates by approximately $3,500 in the first year following the prepayment.
Scorpio Tankers also reported on its recent and future vessel repurchases, including the repurchase of one vessel in April 2024 for $15.8 million and the expected repurchase of four vessels in May and June 2024 for a total of $102.4 million.
These are the latest developments in Scorpio Tankers' ongoing financial and operational activities.
InvestingPro Insights
Scorpio Tankers Inc. (NYSE:STNG) has been actively managing its capital structure, as evidenced by its ongoing share repurchase program and strategic asset sales. Key insights from InvestingPro highlight the company's robust financial position and promising outlook:
InvestingPro Data shows Scorpio Tankers with a market capitalization of $3.87 billion, underpinned by a solid P/E Ratio of 6.78 as of the last twelve months ending Q1 2024. The company's Gross Profit Margin stands impressively at 75.7%, indicating efficient operations and cost management. Additionally, Scorpio Tankers maintains a healthy dividend yield of 2.12%, reflecting its commitment to providing shareholder returns.
InvestingPro Tips reveal that management is actively buying back shares, signaling confidence in the company's valuation and future prospects. Furthermore, the company has maintained dividend payments for 12 consecutive years, demonstrating its financial stability and reliability as an income-generating investment.
For investors looking to delve deeper into Scorpio Tankers' financial health and future performance, InvestingPro offers a comprehensive suite of additional tips. There are 11 more InvestingPro Tips available, which can be accessed at https://www.investing.com/pro/STNG. These tips provide valuable insights, such as analysts' upward revisions of earnings, the company's impressive return over the last year, and predictions of profitability for the current year.
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