Scorpio Tankers announced $100.0m stock buyback program, increased quarterly dividend
For the three months ended March 31, 2014, the Company had net income of $53.3 million, or $0.28 basic and diluted earnings per share. The Company's adjusted net income was $1.9 million (see Non-GAAP Measure section below), or $0.01 basic and diluted earnings per share, which excludes (i) a gain of $51.4 million, or $0.27 per share, resulting from the previously announced sales agreement of seven Very Large Crude Carriers ('VLCCs') under construction, and (ii) an unrealized gain on derivative financial instruments of $47,000 or $0.00 per share, the Company's Q1 financial results report said.
On April 28, 2014, the Scorpio Tankers' board of directors declared a quarterly cash dividend of $0.09 per share, payable on June 12, 2014 to all shareholders as of May 27, 2014 (the record date). As of April 28, 2014, there are 199,718,567 shares outstanding.
Summary of recent and first quarter significant events:
Closed on the previously announced sales agreement of seven VLCCs under construction for a gain of $51.4 million.
Took delivery of three MR tankers under the Company's Newbuilding Program, STI Texas City, in March 2014, and STI Opera and STI Duchessa, in January 2014.
Converted the Newbuilding Credit Facility from a term loan into a reducing revolving credit facility giving the Company the ability to draw down and repay the available commitments under the facility when needed.
Sold three of the Company's older vessels, Noemi, Senatore, and STI Spirit for an aggregate selling price of $74.2 million, further emphasizing the Company's commitment to a modern, fuel efficient fleet.
Declared and paid a quarterly cash dividend on the Company's common stock of $0.08 per share in March 2014.
Newbuilding Credit Facility conversion to a Revolver
In March 2014, the Company converted its Newbuilding Credit Facility with Credit Agricole Corporate and Investment Bank and Skandinaviska Enskilda Banken AB from a term loan to a reducing revolving credit facility. This gives the Company the ability to draw down and repay the available commitments under the facility when needed. All other terms and definitions remain unchanged.
The amount available under this facility is $82.3 million and is fully drawn as of the date of this press release. The amount available will reduce by $1.5 million each quarter until the maturity date in June 2019.
As part of the Company's commitment to a modern fuel efficient fleet, the Company recently sold three of its older vessels:
Two, 2004 built, LR1 product tankers, Noemi and Senatore, for an aggregate selling price of $44.0 million. These sales closed in March and April 2014, respectively.
The 2008 built LR2 product tanker, STI Spirit, for $30.2 million in April 2014.
The Company also made repayments of the debt associated with the three vessels sold for $43.9 million in aggregate. These repayments and their resultant impact on our credit facilities are further described below.
In April 2014, the Company extended the time charter on an MR tanker that is currently time chartered-in. The term of the agreement is for one year at $14,850 per day beginning in May 2014. The Company has options to extend the charter for up to two consecutive one year periods at $15,200 per day and $16,200 per day, respectively.
In April 2014, the Company extended the time charter on an LR2 that is currently time chartered-in. The term of the agreement is for six months at $15,250 per day beginning in May 2014. The Company has an option to extend the charter for up to six months at $15,500 per day.
In March 2014, the Company extended the time charter on a Handymax tanker that is currently time chartered-in. The term of the extension is for one year at $13,550 per day and began in April 2014.
In March 2014, the Company entered into a new time charter-in agreement on an LR1 vessel for one year at $15,000 per day. The Company has options to extend the charter for up to two consecutive one year periods at $16,250 per day and $17,250 per day, respectively. This vessel was delivered in March 2014.
In February 2014, the Company extended the time charters on two Handymax tankers that are currently time chartered-in. The terms of the agreements are for one year at $13,650 per day beginning in April and May 2014. The time charter beginning in April 2014 contains a 50% profit and loss sharing provision whereby the Company will split all of the vessel's profits and losses above or below the daily base rate with the vessel's owner.
In February 2014, the Company entered into a new time charter-in agreement on an LR2 vessel that is currently time chartered-in. The new agreement is for six months at $16,500 per day and commenced upon the expiration of the existing charter in February 2014.
In February 2014, the Company entered into a new time charter-in agreement on an LR2 vessel for one year at $15,000 per day. The Company has an option to extend the charter for an additional six months at $16,250 per day. This vessel was delivered in March 2014.
Scorpio Tankers Inc. is incorporated in the Republic of The Marshall Islands and has principal executive offices in Monaco and New York. Scorpio Tankers Inc. is a provider of marine transportation of petroleum products worldwide. Scorpio Tankers Inc. currently owns 20 tankers (one LR2 tanker, two LR1 tankers, one Handymax tanker, 15 MR tankers, and one post-Panamax tanker) with an average age of 3.1 years, time charters-in 28 product tankers (eight LR2, five LR1, seven MR and eight Handymax tankers), and has contracted for 55 newbuilding product tankers (29 MR, 12 LR2, and 14 Handymax ice class-1A product tankers), 42 are expected to be delivered to the Company throughout 2014 and 13 in 2015. The Company also owns approximately 26% of Dorian LPG Ltd.
