Tsakos Energy Navigation Limited (NYSE:TNP) Q2 2020 Earnings Conference Call - Final Transcript

Sep 23, 2020 • 09:00 am ET

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Tsakos Energy Navigation Limited (NYSE:TNP) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you. [Operator Instructions] Your first question comes from the line of Randy Giveans from Jefferies. Please ask your question.

Analyst
Randy Giveans

Howdy, gentlemen. How is it going?

Executive
Nikolas P. Tsakos

Hi, Randy.

Analyst
Randy Giveans

Hey. So yeah, obviously, congrats on the second quarter. I think it's been pretty well documented that 2Q is strong. But now that basically the third quarter is over, can you give a little more insight in terms of how the market has been more recently in terms of floating storage, U.S. Air Force, cargos out of the Middle East, West Africa? And kind of what you're seeing on trade routes more recently?

Executive
Nikolas P. Tsakos

Well, I'll give it first a go, and then if George wants to add up. As I said, I think up to -- really the third quarter has been a quarter of adjustment, less storage, significantly less storage. Vessels that were on storage came in the market. And of course, a lot over repositioning of vessels also for, I mean, for non-commercial reasons, but mainly for crew changes. The way the company is structured with 27 with -- sorry, 40 vessels on time charters and 27 in the spot market, as Paul said, we were able to charter a number of our ships in the first and second quarter long-term and we expect to have another positive quarter. And following the beginning of the fourth quarter, we see the market becoming stronger in the Far East, which on the crude side and the clean side.

Analyst
Randy Giveans

Okay. George, anything to add?

Executive
George V. Saroglou

Not really. Not really.

Analyst
Randy Giveans

Okay.

Executive
George V. Saroglou

Everything is very well put by Mr. Tsakos.

Analyst
Randy Giveans

All right. Didn't want to cut you off there. All right. And then kind of looking at uses of path, obviously, within the preferred, the CDC getting repurchased, I think you said in common players being repurchased, also obviously, delevering continues to be the focus. But you've also done this shuttle tanker newbuilding order, right? So just kind of looking ahead, there is a free cash flow boost in the fourth quarter that you do some sales or some older tonnage to get a little more kind of discretionary cash, let's call it. What are the kind of priorities in terms of using that relative to debt deleveraging or return of capital to shareholders through additional repurchases or further newbuilding orders. Can you kind of rank those?

Executive
Nikolas P. Tsakos

Yeah. There's always a combination. I think we are repurchasing debt. We must be one of the very few companies in our peer group who have maintained a continuous clean sheet with our banks, never having any discussions on our repayment schedules, to say the least. And that's why, as Paul said, we are seeing right now -- I think we are discussing now we're getting our debt very close to the all time lows of just above 100 basis points, between 100 and 150. And so that -- this is our priority; dividend to our shareholder and growth of the company. But as we were able to portray during