Euroholdings (NasdaqCM:EHLD) Q4 2025 Earnings call February 25, 2026 09:00 AM ET Company ParticipantsAnastasios Aslidis - Chief Strategy Officer and TreasurerAristides Pittas - Chairman and CEOAthina Atalioti - CFOOperatorThank you for standing by, ladies and gentlemen, and welcome to the Euroholdings Conference Call on the Q4 2025 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer, Ms. Athina Atalioti, Chief Financial Officer, and Mr. Tasos Aslidis, Chief Strategy ...

We expect to take over full commercial and technical management of these vessels in the second and third quarter of this year. In addition, we sold or agreed to sell two older Suezmaxes, for gross proceeds of $73,000,000 and just this week, we finalized an agreement to sell our only VLCC for gross proceeds of $84,500,000 with delivery during Q2. We expect to recognize total gains from sales of approximately $45,000,000 in 2026. Looking at our first quarter to date, the tanker market has continued to strengt ...

Key Takeaways from the Tanker Market Expert Call Industry Overview - The discussion focused on the tanker market, particularly crude and clean tankers, as part of the Energy Symposium Week hosted by Goldman Sachs on February 3, 2026. The expert from Oil Brokerage Ltd (OB) expressed a generally positive outlook for the total tanker market, projecting a net demand increase of +3.6 percentage points by 2026 [1][4]. Core Insights Crude Tanker Market - **Demand Growth**: OB forecasts a +5.8% year-over-year (YoY) growth in crude tanker demand for 2026, driven by: - Stockpiling due to sustained increases in crude production, which is expected to outpace demand growth. - Enhanced long-haul shipping demand from rising crude oil output in the Atlantic Basin [4]. - **Supply Dynamics**: The effective fleet supply is projected to grow by +2% YoY, leading to a net demand increase of +3.8% for crude tankers in 2026. However, demand growth is expected to slow to +2.1% YoY in 2027, with supply growth at +3% YoY, resulting in a -0.9% net supply for that year [4][5]. Clean Tanker Market - **Demand Forecast**: Clean tanker demand is also expected to grow, with projections of +5% and +3% YoY growth for 2026 and 2027, respectively. This growth is supported by elevated refinery margins due to tight capacity and healthy demand [4]. - **Supply Concerns**: Despite the demand growth, supply for clean tankers is anticipated to increase by +4% and +6% YoY in 2026 and 2027, respectively, leading to a +1% net demand in 2026 and a -3% net supply in 2027 [4]. Aging Fleet and Orderbook - The orderbook for uncoated tankers has reached approximately 91% of the trading fleet over 20 years old as of January 2026. OB believes that deliveries will not be sufficient to replace aging ships, which may exit the market through scrapping or being absorbed into a shadow fleet [5]. Geopolitical Impacts - OB anticipates a shift in trade volumes towards compliant vessels, which would positively impact Very Large Crude Carrier (VLCC) demand if restrictions on Venezuelan or Iranian oil are lifted. Specifically, the removal of sanctions on Venezuelan oil could necessitate an additional 44 VLCCs and 19 Aframax tankers [5]. - Conversely, a reopening of the Suez Canal could negatively affect clean tanker demand, particularly for LR2 vessels [5]. Additional Insights - The expert highlighted that the return on investment (RoI) for crude tankers has improved, leading to an increase in ordering frequency for uncoated tankers in the fourth quarter of 2025 [5]. - The expert expressed skepticism regarding constructive dialogue between the US and Iran, suggesting that disruptions in the Middle East are more likely than a resolution [5]. This summary encapsulates the key points discussed during the expert call, providing insights into the current and future state of the tanker market, including demand forecasts, supply dynamics, and geopolitical influences.

Financial Data and Key Metrics Changes - Teekay Tankers reported GAAP net income of $76 million or $2.2 per share and adjusted net income of $42 million or $1.21 per share in the first quarter [5] - The company generated approximately $65 million in free cash flow from operations during the quarter [6] - Teekay Tankers declared a regular quarterly fixed dividend of $0.25 per share and a special dividend of $1 per share, totaling $1.25 per share payable in May [7][8] - Book equity per share increased by over $21 to approximately $53 per share as of March 31, 2025 [8] Business Line Data and Key Metrics Changes - The spot tanker market has strengthened, with rates for Suezmax and Aframax LR2 fleets at $40,400 per day and $36,800 per day, respectively, with approximately 45% of spot days booked [7] - The company has sold six vessels for total gross proceeds of approximately $183 million, with an expected accounting gain of approximately $53 million [6] Market Data and Key Metrics Changes - Midsized tanker spot rates have increased to the highest levels in over twelve months due to increased oil production from The Americas and U.S. sanctions on Russian and Iranian shipping [10] - Suezmax tanker tonne mile demand has benefited from a strong increase in the export of Kazakh crude oil, with record high loadings in March [11] - Aframax loadings from Vancouver have also reached record highs, with a significant increase in direct transits to Asia [12] Company Strategy and Development Direction - Teekay Tankers is focused on reducing exposure to older tankers and opportunistically selling vessels as part of a fleet renewal plan [6] - The company aims to balance cash flow generation with the need to reinvest in new vessels as market conditions change [20] - The management is assessing opportunities in adjacent sectors while maintaining a focus on core operations [45] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the medium-term outlook for the tanker market, despite uncertainties due to geopolitical developments and economic conditions [15][18] - The company is prepared for potential corrections in the market but believes that aging fleet dynamics will support tanker rates [19][57] - There is a potential for counter-seasonal strength in tanker rates due to low oil inventories and the need for restocking [60][62] Other Important Information - The pace of tanker newbuild orders has slowed significantly, with only 2.8 million deadweight tonnes ordered in the first quarter of 2025, the lowest since Q3 of 2022 [19] - The average age of the global tanker fleet is 13.9 years, the highest since February 2001, indicating a need for fleet renewal [19] Q&A Session Summary Question: Market outlook and asset values - Management acknowledged the challenge of balancing a strong market with the need to reinvest in new vessels, indicating that opportunities to reload may arise when market conditions change [24][26] Question: Maintaining critical mass in fleet - Management stated that while there is some room to reduce fleet size, they are cautious about dipping below a certain threshold that could impact commercial performance [35][38] Question: Capital allocation and investment strategy - Management confirmed that they are assessing the attractiveness of investing in TNK shares, given the current liquidity and market conditions [29][31] Question: Strength of tanker rates and geopolitical impacts - Management noted that while current rates are strong, predicting future movements is complex due to various global factors, but they expect some corrections in the market [50][51] Question: Restocking oil inventories and its impact - Management indicated that the current low inventories could lead to increased demand for tankers, potentially supporting rates in the near term [60][62]

Financial Data and Key Metrics Changes - Net income for Q1 2025 was $50 million or $1 per diluted share, with adjusted net income at $40 million or $0.80 per diluted share, and adjusted EBITDA at $91 million, consistent with the previous quarter [5][14] - Total liquidity at the end of Q1 2025 was $673 million, including nearly $550 million of undrawn revolver capacity, with gross debt of over $600 million, resulting in a net loan to value of about 15% [6][18] Business Line Data and Key Metrics Changes - The lightering business generated over $8 million in revenue during the quarter, contributing approximately $2 million in EBITDA [15] - The company increased time charter exposure, securing a one-year time charter on a Suezmax vessel, expected to generate $295 million in fixed revenue over the next two years [7] Market Data and Key Metrics Changes - Oil production is expected to increase by over 1 million barrels per day in 2025 and 2026, with non-sanctioned OPEC plus reinforcing output increases, supporting VLCC trade [9] - OECD inventories have drawn down 100 million barrels since August 2024, which has muted tanker markets in the short term [10] Company Strategy and Development Direction - The company aims to maintain a balanced capital allocation strategy, returning 75% of adjusted net income to shareholders through dividends, while also investing in fleet renewal [8][24] - The company is positioned to capitalize on market conditions, with a focus on reducing breakeven costs and enhancing financial flexibility for growth [19][25] Management Comments on Operating Environment and Future Outlook - Management noted that the current geopolitical environment introduces uncertainty, but changes in tanker routing may support the industry [11][12] - The company anticipates continued strong performance in the tanker market, with expectations of significant free cash flows in Q2 2025 [22] Other Important Information - The company has a repurchase program of up to $50 million and has returned over $300 million to shareholders in consecutive years [8][24] - The average age of the fleet is about 10 years, which is considered optimal for tanker investments [24] Q&A Session Summary Question: Financing for LR1s and undrawn capacity - Management is evaluating options for financing the remaining installments for LR1s, with the undrawn capacity providing flexibility [28][30] Question: Impact of refinancing on breakeven rates - Refinancing the lease facility could reduce breakeven rates by several hundred dollars per day, providing savings on interest [32][35] Question: OPEC plus production impact on charters - There is a lag in the impact of OPEC plus production increases on charter conversations, with expectations for increased listings in the next quarter [39] Question: Leverage targets - The company aims to maintain leverage below 20%, with current net loan to value under 15%, allowing for additional leverage when appropriate [42][43] Question: LR2 market outlook - The aging profile of the LR2 fleet and strong growth in ton miles are expected to influence trading dynamics positively [49][51] Question: Opportunities for fleet renewal - The company is actively seeking opportunities to lower the average age of its fleet and remains vigilant in the market [61]

Financial Data and Key Metrics Changes - Net income for Q4 2024 was $36 million or $0.72 per diluted share, with adjusted net income at $45 million or $0.90 per diluted share, and adjusted EBITDA at $95 million [10][26] - The company reported a total liquidity of $632 million, consisting of $157 million in cash and $475 million in undrawn revolving credit [13][33] - The net loan-to-value ratio is below 16%, with a breakeven rate of approximately $13,700 per day [14][34] Business Line Data and Key Metrics Changes - The lightering business generated over $9 million in revenue for the quarter, contributing nearly $3 million in EBITDA for Q4 and approximately $20 million for the full year [28] - The company executed a vessel swap, selling two older VLCCs and acquiring three ECO MRs, which is part of a strategy to modernize the fleet [11][24] Market Data and Key Metrics Changes - Oil demand growth is expected to continue at a historical rate of about 1% per year, with a projected increase of 1 to 1.5 million barrels per day for 2025 [16][17] - The geopolitical landscape remains complex, affecting tanker movements, particularly with tensions involving the U.S. and Iran, as well as the ongoing Israel-Hamas conflict [18][19] Company Strategy and Development Direction - The company aims to modernize its fleet, maintaining an average age of around ten years, which is seen as optimal for tanker investments [42] - A balanced capital allocation approach is emphasized, focusing on fleet renewal while providing competitive returns to shareholders [15][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the tanker market's resilience, anticipating continued strong earnings due to limited tanker supply and a favorable demand environment [24][42] - The company expects to maintain a payout ratio of at least 75% going forward, reflecting a commitment to returning capital to shareholders [72] Other Important Information - The company returned over $300 million to shareholders in 2024, representing a 12% dividend yield on the average share price [14][41] - The company has a strong financial position with $475 million in undrawn credit capacity, allowing for flexibility in growth opportunities [42] Q&A Session Summary Question: Charter-out strategy in the current market - Management indicated that they have fourteen time charters in their fleet and are continuously evaluating opportunities in the charter market [50][53] Question: Outlook for MR rates and geographic focus - Management noted that Q1 bookings are strong, with good exposure to the East market, while the U.S. Gulf rates are showing some decline [61] Question: Dividend payout ratio expectations - Management confirmed that shareholders should expect a minimum payout ratio of 75%, with flexibility to adjust based on earnings fluctuations [72][73] Question: VLCC MR swap strategy - The swap was aimed at reducing the average age of the fleet rather than deemphasizing VLCCs, with a focus on maintaining a balanced fleet profile [76][80] Question: Breakeven rate components and future cost management - Management stated that they are focused on keeping costs in line and are optimistic about maintaining current breakeven rates [88] Question: Suez Max outlook - Management indicated that Suez Max rates are expected to improve as the VLCC market strengthens [98] Question: Share repurchase plans - Management confirmed that while the payout ratio is the primary method of returning cash, opportunistic buybacks are also considered [102] Question: Charter specifications and older vessels - Management noted that charterers may show some flexibility depending on market conditions and vessel availability [108] Question: Red Sea transit inquiries - Management stated that there are currently no pressures from charters to resume transits through the Red Sea [113]

Financial Data and Key Metrics Changes - Net income for Q4 2024 was $36 million or $0.72 per diluted share, with adjusted net income at $45 million or $0.90 per diluted share, and adjusted EBITDA at $95 million [4][17] - The company reported a total liquidity of $632 million, consisting of $157 million in cash and $475 million in revolving credit facility [7][21] - The net loan to value ratio is below 16%, with a spot break-even rate of approximately $13,700 per day [7][21] Business Line Data and Key Metrics Changes - The lightering business generated over $9 million in revenue for the quarter, contributing nearly $3 million in EBITDA [18] - The company executed a vessel swap, selling two older VLCCs and acquiring three Eco MRs built in 2015, optimizing fleet efficiency [6][9] Market Data and Key Metrics Changes - Oil demand growth is expected to continue at a historical rate of about 1% per year, translating to an increase of 1 to 1.5 million barrels per day in 2025 [9][10] - The geopolitical situation, including tensions in the Red Sea and the Russia-Ukraine conflict, continues to impact tanker movements and market dynamics [11][12] Company Strategy and Development Direction - The company aims to modernize its fleet while maintaining a balanced capital allocation approach to provide competitive returns to shareholders [8][25] - The focus is on reducing the average age of the fleet, currently around 10 years, to enhance operational efficiency and capture market opportunities [50][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the tanker market's robustness despite geopolitical uncertainties, anticipating continued strong demand for tankers [82] - The company expects to maintain a payout ratio of at least 75% going forward, reflecting a commitment to returning capital to shareholders [46][47] Other Important Information - The company returned over $300 million to shareholders in 2024, representing a 12% dividend yield on the average share price [8][25] - The company has a $50 million share repurchase program, indicating flexibility in capital allocation strategies [72] Q&A Session Summary Question: Charter strategy in the current market - Management indicated they have 14 time charters out of 78 vessels and are continuously evaluating time charters with the right partners [32][33] Question: MR rates and geographic focus - Management noted that Q1 bookings are strong, with good exposure to both the Atlantic Basin and the East market [37] Question: Dividend payout ratio outlook - Management confirmed a minimum payout ratio of 75% going forward, with flexibility to adjust based on earnings fluctuations [46][47] Question: VLCC and MR swap transaction - The swap was aimed at reducing the fleet's average age rather than deemphasizing crude tankers [50] Question: Suezmax outlook - Management expects Suezmaxes to improve as geopolitical conditions stabilize, which could enhance market dynamics [70] Question: Liquidity and opportunistic buybacks - Management stated that while dividends are the primary method of returning cash, share repurchases are also considered [72] Question: Charter specifications and older vessels - Management acknowledged some flexibility from charters regarding older vessels, depending on market conditions [76] Question: Red Sea transit and charterer inquiries - Management indicated no current pressure from charterers to resume Red Sea transits, emphasizing the need for stability in the region [78]