International Seaways Inc. Third Quarter 2025 Earnings Presentation November 6, 2025 Disclaimer Forward-Looking Statements During the course of this presentation, the Company (International Seaways, Inc. (INSW)) may make forward-looking statements or provide forward-looking information. All statements other than statements of historical facts should be considered forward-looking statements. Some of these statements include words such as ''outlook,'' ''believe,'' ''expect,'' ''potential,'' ''continue,'' "gui ...

Revenue and Market Performance - For the three and nine months ended September 30, 2025, the Company derived 52% and 51% of its TCE revenues from the Product Carriers segment, compared to 55% and 54% for the same periods in 2024[121]. - Approximately 81% of total TCE revenues for the three and nine months ended September 30, 2025, were derived from the spot market, down from 84% and 87% for the same periods in 2024[126]. - TCE revenues decreased by $27.2 million, or 12%, to $192.5 million in Q3 2025 from $219.7 million in Q3 2024, primarily due to lower average daily rates and vessel sales[140]. - For the first nine months of 2025, TCE revenues for crude tankers decreased by $67.1 million, or 20%, to $276.5 million from $343.6 million in the same period of 2024[157]. - TCE revenues for the Product Carriers segment decreased by $21.4 million, or 18%, to $99.5 million in Q3 2025 from $120.9 million in Q3 2024[165]. - For the first nine months of 2025, TCE revenues for the Product Carriers segment decreased by $115.7 million, or 29%, to $283.1 million from $398.8 million in the same period of 2024[168]. Fleet and Operational Metrics - As of September 30, 2025, the Company's operating fleet consisted of 71 vessels, totaling 8.2 million deadweight tons, with five newbuilds scheduled for delivery, increasing the fleet to 76 vessels[122]. - In Q3 2025, the tanker fleet increased by 5.1 million dwt, with the crude fleet growing by 3.2 million dwt, including increases of 0.6 million dwt in VLCCs, 1.4 million dwt in Suezmaxes, and 1.2 million dwt in Aframaxes[134]. - The average number of owned vessels decreased from 21.0 in 2024 to 19.0 in Q3 2025[145]. - The average number of owned vessels decreased to 40.2 in Q3 2025 from 41.2 in Q3 2024[160]. - The crude tanker orderbook decreased by 1.2 million dwt in Q3 2025, while the total tanker orderbook increased by 10.2 million dwt year-over-year[135]. Financial Performance - Income from vessel operations fell by $22.3 million to $78.7 million in Q3 2025, down from $101.0 million in Q3 2024, mainly due to lower TCE revenues[138]. - The company declared total dividends of $34.5 million, $29.6 million, and $38.0 million for the first three quarters of 2025, with a regular quarterly dividend of $0.12 per share and a supplemental dividend of $0.74 per share declared on November 5, 2025[195]. - For the three months ended September 30, 2025, net income was $70.5 million, a decrease of 23% compared to $91.7 million in the same period of 2024[184]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $299.9 million, down 38.6% from $488.5 million in the same period of 2024[184]. Expenses and Liabilities - Vessel expenses decreased by $4.4 million to $29.8 million in Q3 2025, attributed to the sale of two VLCCs[153]. - Vessel expenses increased by $4.1 million to $112.0 million in the first nine months of 2025 compared to $107.9 million in the same period of 2024[169]. - General and administrative expenses decreased by $1.6 million to $11.8 million in Q3 2025 from $13.4 million in Q3 2024[170]. - Interest expense decreased to $9.6 million in Q3 2025 from $12.5 million in Q3 2024, reflecting a reduction in the average outstanding principal balance[176]. - Total debt outstanding as of September 30, 2025, was $792.0 million, with a net debt to capital ratio of 16.4%, down from 22.2% at December 31, 2024[192]. Future Outlook and Commitments - Future minimum revenues expected from non-cancelable time charters as of September 30, 2025, total $229.2 million, with $31.9 million in 2025 and $82.8 million in 2026[126]. - The company has contractual commitments for the construction of five dual-fuel ready LR1s and various performance efficiency devices, with total long-term contractual obligations amounting to $1.2 billion as of September 30, 2025[203]. - The company executed a credit agreement for a 12-year term loan facility of up to $239.7 million to finance the acquisition of six LR1 newbuildings[200]. - The company plans to use net proceeds from the $250 million 2030 Bonds to retire higher-cost debt and for general corporate purposes[200]. - The company aims to pursue a disciplined capital allocation strategy focusing on fleet renewal, incremental debt reduction, and returns to shareholders[202]. Market Conditions - Global oil consumption for Q3 2025 is estimated at 104.8 million barrels per day, a 0.7% increase from Q3 2024, with 2025's total expected to be 103.8 million b/d[128]. - OPEC crude oil production averaged 27.9 million b/d in Q3 2025, an increase of 1.4 million b/d from Q3 2024[129]. - U.S. crude oil production reached 13.6 million b/d in Q3 2025, reflecting a 3.3% increase from Q3 2024[131]. - OECD commercial crude inventories decreased by 1.0%, or 13 million barrels, in Q3 2025 compared to Q2 2025[133]. Legal and Administrative Matters - The company expects to incur one-time legal and administrative expenses of between $3 million and $5 million in 2025 related to the redomiciliation process[179]. - The company commenced the process of changing the domicile of its vessel-owning subsidiaries from the Marshall Islands and Liberia to Bermuda, expected to be completed by the end of Q4 2025[178]. Risk Management - The Company operates in a highly cyclical industry, with revenues sensitive to supply and demand patterns for its vessels[123]. - The Company emphasizes a vessel employment strategy that balances spot and long-term charters to optimize economic performance[123]. - The Company manages market risk from interest rate changes through derivative financial instruments, including interest rate swaps and caps[206].

Financial Performance - Net income for Q3 2025 was $71 million, or $1.42 per diluted share, down from $92 million, or $1.84 per diluted share in Q3 2024[6][9] - Adjusted net income for Q3 2025 was $56,888,000, down from $78,233,000 in Q3 2024, representing a decrease of 27.4%[41] - Net income for the nine months ended September 30, 2025, was $181,757,000, down from $380,901,000 in the same period of 2024, representing a decline of 52.3%[31] - The company reported a net income of $70,546,000 for Q3 2025, compared to $91,688,000 in Q3 2024, a decrease of 23.1%[41] Revenue and Earnings - Shipping revenues for Q3 2025 were $196 million, compared to $225 million in Q3 2024, while TCE revenues decreased to $192 million from $220 million[10] - Total Shipping Revenues for Q3 2025 were $196,388,000, a decrease of 12.8% from $225,190,000 in Q3 2024[31] - Time Charter Equivalent (TCE) revenues for Q3 2025 were $192,468,000, compared to $219,687,000 in Q3 2024, a decline of 12.4%[44] - Adjusted EBITDA for Q3 2025 was $108 million, down from $130 million in Q3 2024[11] - EBITDA for Q3 2025 was $121,339,000, compared to $143,487,000 in Q3 2024, reflecting a decline of 15.4%[42] - Adjusted EBITDA for the nine months ended September 30, 2025, was $299,909,000, down from $488,467,000 in the same period of 2024, a decrease of 38.7%[42] Liquidity and Financial Flexibility - Total liquidity as of September 30, 2025, was $985 million, including cash of $413 million and $572 million undrawn revolving credit capacity[6] - The company successfully placed $250 million of senior unsecured bonds at a coupon rate of 7.125% to enhance financial flexibility[20] - Cash and cash equivalents increased to $412,569,000 as of September 30, 2025, compared to $157,506,000 at the end of 2024, marking a significant increase of 162.5%[32] Fleet and Operations - The fleet totaled 76 vessels as of September 30, 2025, with 62 owned and 14 chartered in[38] - The company sold five vessels with an average age of 17.7 years for proceeds of approximately $67 million during Q3 2025[15] - The company took delivery of the Seaways Alacran, the first of six LR1 newbuildings, with a total contract price of approximately $359 million[14] - The newbuild fleet includes 5 LR1 vessels with a total Dwt of 368,000, bringing the total fleet to 76 vessels[39] - The total operating fleet consists of 71 vessels with a total deadweight tonnage (Dwt) of 8,191,815[39] Market Conditions - Market conditions strengthened late in Q3 2025, with tanker demand supported by oil demand growth of about 1%[7] - The average TCE rate for VLCC in Q3 2025 was $34,809, an increase from $29,711 in Q3 2024, reflecting a growth of 17.5%[35] Expenses and Debt - Operating expenses for the nine months ended September 30, 2025, totaled $368,200,000, an increase from $346,817,000 in the same period of 2024, representing a rise of 6.4%[31] - Interest expense for the nine months ended September 30, 2025, was $30,836,000, compared to $37,808,000 in the same period of 2024, a decrease of 18.4%[31] - The company incurred third-party debt modification fees of $0 in Q3 2025, compared to $168,000 in the nine months ended September 30, 2024[42] Revenue Days - The company reported a total of 6,245 revenue days in Q3 2025, down from 6,671 revenue days in Q3 2024, a decrease of 6.4%[35] - The weighted average shares outstanding (diluted) for Q3 2025 were 49,606,210, slightly down from 49,881,317 in Q3 2024[41]

Core Viewpoint - The increase in global oil supply and sanctions have led to a surge in demand for "unaffected" tankers, resulting in the highest tanker earnings since the peak of the COVID-19 pandemic [1] Group 1: Oil Tanker Earnings - The daily rental rate for tankers transporting 2 million barrels of crude oil from the Middle East to China has risen by 40% to $125,000, marking the highest level since April 2020 [1] - The Baltic Exchange reports that this increase is driven by the need for alternative sources due to recent U.S. sanctions on two major Russian oil companies [1] Group 2: Market Dynamics - Lars Barstad, CEO of Frontline, noted that sanctioned crude oil transportation is hindered, leading to longer waiting times for vessels [1] - There has been an increase in shipping volume from the Atlantic Basin to Asia, contributing to a rise in ton-miles [1] - More OPEC crude oil is entering the market, further influencing tanker demand [1] Group 3: Related Stocks - Relevant stocks in the tanker industry include Frontline, Teekay, Teekay Tankers, CMB.Tech, Scorpio Tankers, DHT Holdings, Tsakos Energy Navigation, Navios Maritime Holdings, International Seaways, Nordic American Tankers, and SFL Corp [1]

Core Viewpoint - Investors in International Seaways, Inc. (INSW) should closely monitor the stock due to significant implied volatility in the options market, particularly for the Dec 19, 2025 $17.50 Put option [1] Company Analysis - International Seaways is currently rated as a Zacks Rank 2 (Buy) within the Transportation – Shipping industry, which is in the top 33% of the Zacks Industry Rank [3] - Over the past 30 days, two analysts have raised their earnings estimates for the current quarter, resulting in an increase of the Zacks Consensus Estimate from 65 cents per share to 91 cents per share [3] Options Market Insights - The high implied volatility suggests that options traders are anticipating a significant price movement for International Seaways shares, potentially indicating an upcoming event that could lead to a major price change [2][4] - Seasoned options traders often seek to sell premium on options with high implied volatility, aiming to benefit from the decay of the option's value if the underlying stock does not move as much as expected [4]

Group 1 - The analyst has a diverse professional background across multiple industries, including logistics, construction, and retail, which provides a unique perspective on investing [1] - The investment strategy focuses on cyclical industries, aiming for significant returns during economic recovery and growth, while also maintaining a diversified portfolio that includes bonds, commodities, and forex [1] - The importance of balancing risk is acknowledged, leading to the incorporation of fixed-income investments in the overall strategy [1]

Core Points - International Seaways, Inc. plans to release its third quarter 2025 results before market open on November 6, 2025 [1] - The company will host a conference call for investors at 9:00 a.m. Eastern Time on the same day [1] - Dial-in numbers for the conference call include US: +1 (833) 470-1428 and International: +1 (929) 526-1599 with Conference ID 750591 [1]

Core Viewpoint - International Seaways, Inc. has successfully placed $250 million of new senior unsecured bonds in the Nordic bond market, maturing in September 2030 with a fixed coupon of 7.125% per annum [1][2]. Group 1: Bond Issuance Details - The net proceeds from the bond issue will be used for refinancing the Ocean Yield sale-and-leaseback agreement and for general corporate purposes [2]. - The bonds are intended for qualified institutional buyers in the United States under Rule 144A of the Securities Act of 1933 and have not been registered under the U.S. Securities Act [3]. Group 2: Company Overview - International Seaways, Inc. is one of the largest tanker companies globally, providing energy transportation services for crude oil and petroleum products [4]. - The company operates a fleet of 77 vessels, including 12 VLCCs, 13 Suezmaxes, five Aframaxes/LR2s, 11 LR1s, and 36 MR tankers [4].

Group 1 - International Seaways reported mixed results for Q2 2025, showing better performance quarter on quarter but slightly worse figures compared to Q2 2024 [1]

Financial Data and Key Metrics Changes - Net income for Q2 2025 was $62 million or $1.25 per diluted share, with adjusted net income at $50 million or $1.02 per diluted share, and adjusted EBITDA at $102 million [4][17] - The company announced a combined dividend of $0.77 per share, maintaining a payout ratio of at least 75% for four consecutive quarters [5][4] - Total liquidity at the end of Q2 was over $700 million, with $149 million in cash and $560 million in undrawn revolver capacity [9][10] Business Line Data and Key Metrics Changes - The lightering business generated over $9 million in revenue with EBITDA contribution of about $2 million in Q2 [18] - The company sold two vessels for proceeds of $28 million and has four more expected to deliver in Q3 for around $57 million [6][20] Market Data and Key Metrics Changes - Demand fundamentals for seaborne transportation remain solid, with upward revisions to GDP forecasts potentially increasing oil demand [11] - Crude storage levels are historically low, and product inventories are also at low levels, particularly for middle distillates [11][12] Company Strategy and Development Direction - The company is focused on fleet renewal, having sold six older vessels and planning to purchase a modern scrubber-fitted VLCC [6][8] - The strategy includes maintaining a balanced capital allocation approach while returning cash to shareholders [27][24] Management's Comments on Operating Environment and Future Outlook - The geopolitical environment remains fluid, impacting trade routes and tanker demand, with potential for increased rates due to tensions in regions like the Strait of Hormuz [12][13] - The company expects to continue generating significant free cash flows and building on its track record of returning cash to shareholders [25][29] Other Important Information - The company has secured financing commitments for up to $240 million for newbuild vessels, with a twenty-year amortization profile [8][23] - The net loan to value ratio is comfortably under 15%, indicating a strong balance sheet [9][10] Q&A Session Summary Question: Clarification on vessel sales proceeds - The $57 million expected from the four vessels should be considered as debt proceeds [32] Question: Impact of recent sanctions on trade patterns - India is taking compliant tonnage for export and has increased imports of US Gulf crude, indicating a tactical trading approach [34] Question: Benefits of OPEC+ production cuts unwinding - Increased crude flow will benefit smaller tankers as VLCCs will be more engaged in moving crude, reducing competition in smaller segments [39] Question: Future vessel refinancing - The company is evaluating various options for refinancing older vessels, with sufficient revolver capacity to fund repayments [48][49] Question: Expected financing terms for older vessels - Financing for older vessels is expected to be shorter than the twelve-year term secured for newbuilds, likely around five to seven years [52]