Tsakos Energy Navigation Limited Aktie

Thank you for standing by, ladies and gentlemen, and welcome to the Tsakos Energy Navigation Conference Call on the Second Quarter 2026 Financial Results. We have with us Mr. Takis Arapoglou, Chairman of the Board; Mr. Nikolas Tsakos, Founder and CEO; Mr. George Saroglou, President and Chief Operating Officer; and Mr. Harrys Kosmatos, CFO of the company. [Operator Instructions] I must advise you that this conference is being recorded today.

And now I pass the floor to Mr. Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation Ltd. Please go ahead, sir.

Thank you very much, and good morning to all of our participants. I am Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation.

This morning, the company publicly released its financial results for the 6 months and second quarter ended June 30, 2026. In case you do not have a copy of today's earnings release, please call us at (212) 661-7566 or e-mail us at [email protected], and we will have a copy for you e-mailed right away.

Please note that parallel to today's conference call, there is also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please, we urge you to access the presentation slides on the company's website.

Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user controlled, and that means that by clicking on the proper button, you can move to the next or to the previous slide on your own.

And at this time, I would like to read the safe harbor statement. This conference call and slide presentation of the webcast contain certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties which may affect TEN's business prospects and results of operations.

And at this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation. And before doing that, I'd like to congratulate the company for the record revenue performance, and it seems that you are on course to break the $1 billion revenue target for the year. So Mr. Arapoglou, the floor is yours.

So thank you, Nicolas. Good morning and good afternoon to all. Thank you for joining our call today presenting second quarter first half results of TEN. And of course, once again, congratulations to Nikos Tsakos and the team for the stellar results, as briefly described by Mr. Bornozis. Our model, TEN's model has proven that it works even in weak markets, so no surprise that it works so well also in this market where current market conditions are very favorable. And it's a great opportunity for TEN to continue generating cash from operations, to continue from selling all the vessels to renew the field, the fleet and generate more cash, to fund a record order book, as you have seen in the press release, and keep cash for contingencies. Perhaps if the Board decides repay, redeem the Series E preferred, nobody knows, it's a next year issue. And more importantly, rewarding our investors.

I want to emphasize this because during the calendar year 2026, we paid dividends of $0.60 and $1 for a total of $1.60 per share. And it's obvious that this can only go higher if approved by the Board and if current conditions are maintained. This is a solid yield of very close to 4%, and it's a generous payout compared to other companies in the sector. So we want to underline that we want to reward our shareholders for staying with us who have actually benefited also from a nearly doubling of the stock price in the last 2 years.

Finally, TEN is making use of the strong market and of the high time charter rates to lock in high returns for its fleet. And up to now, the total of forward committed earnings is approximately $3.5 billion. So this is a great cushion and a great base to look forward to continued success in the next 2 to 3 years.

So once again, congratulations to Nikos Tsakos and the team for the stellar results, and sincere wishes for continued success. Thank you very much. And now, Nikos Tsakos, the floor is yours. I pass on the floor to you. Thank you.

Chairman, thank you very much for your kind words. And hopefully, we will continue this trend. Before that, of course, from all of us here in TEN and the family, we all remember 9/11. We are all -- been living in the U.S. and New York since -- for the last 45 years. Many of us around this table were there 25 years ago. Our office, our original office in New York is just on Rector Street, 2 blocks south of ground zero.

And just to remind you that we were the first company to go public after 9/11. We went public in March 2002. And we were actually starting our roadshow in -- after Labor Day originally in 2001 before these terrible events. So it's, I would say, very much into our mind and in our hearts, and we do not forget 9/11.

Well, on a happier note, I have to say that this is a record-breaking period for our results in many segments. But it's not only -- but it's not looking back at it. It seems that even after the first 6 months, which have been very profitable, we are -- the second part is actually doing -- is even stronger.

The appetite of the major oil companies and all the charter is unprecedented. I've never seen that in my 30-plus years in business. A year ago, I would be happy when we said we had business for 1, 2 or 3 years for our existing ships. Right now, charterers are there to take anything which is 10 years or younger for up to 7 years and their appetite. So we are actually balancing this luxury problem to have, together with our commercial department, we are making sure that TEN is taking advantage of the highs and at the same time, secures long-term employment for when things become for a rainy day, as they say.

It is actually also very rewarding to see that we had our largest newbuilding program of 26 vessels started 2 years ago. We have already taken delivery of 7 of those ships. And the valuation of those ships has already increased by at least 30%. So I think our $3 billion newbuilding program is close to -- value today, close to $3.8 billion, $3.9 billion and growing on a monthly basis. So we are very well in the money. We took the decision to rebuild a big part of our fleet at a time where values -- newbuilding values were, I would say, more logical.

So looking forward, we're looking for a good year. As the Chairman said, we're looking to increase the dividend for our shareholders. And we always make this announcement after our strategy meeting in November, so looking forward for an increase of that. And hopefully, the market will maintain its strength right now.

And for more details, I will ask Mr. Saroglou, our President, to give us what has happened in the first 6 months and subsequent events.

Thank you, Nikos. We are very pleased today to report another profitable quarter. Excluding capital gains, this is a record-breaking quarter and first half for net income. We maintained a steady course in the most turbulent geopolitical environment in recent memory.

The year started with the political development in Venezuela and escalated with the war in the Middle East and the closure of the Strait of Hormuz. The Strait of Hormuz experienced its most severe disruption in modern history, effectively halting normal global oceangoing commerce. The war was hoping for a resolution following the signing of a ceasefire agreement, which quickly unraveled halfway through the 60-day period was supposed to last.

There is a U.S. naval blockade that tries to manage the safe passage of tankers in and out of this narrow, high-risk area. We have attacks on oceangoing vessels that attempt to cross the Strait on their own or with the protection of the U.S. Navy. Vessels have been attacked, and seafarers serving onboard have been injured and killed while trying to do their job and keep the world and global commerce going. Our company continues to avoid the Strait of Hormuz. Our thoughts and prayers are with all the seafarers that are stranded inside the area and have to endure every day, the unnecessary stress and psychological mental fatigue for which they are not responsible.

Tanker market fundamentals were strong even before geopolitics took center stage at the end of February. 2026 was forecasted to be another year with growth in global oil demand, while tonnage supply remained very balanced. The effect of the war in the Middle East and the ongoing closure in the Strait of Hormuz resulted in elevated crude and product prices that affected global oil demand.

Despite higher prices, these geopolitical events have significantly added to the market strength, and the tanker market -- the tanker freight market has gone from strength to strength. And TEN's diversified fleet, with each new charter renewal and the fleet's market exposure to spot and profit sharing rates, will continue to further benefit from this unprecedented market dislocation. And this is basically what we have done in the 33-year history we have as a public company. And this is what basically we say in Slide #1 on Page 4, that we managed since 1993 to turn every crisis the world has faced into a growth opportunity.

Today, we have an 81-vessel fleet, and we are one of the largest energy transporters in the world with a very young, diversified and versatile pro forma fleet of 81 vessels. In Slide 4, we list this pro forma fleet of all conventional tankers, both crude and product carriers. The red color shows the vessels that trade in the spot market, and we have currently 10 tankers trading spot, and our newbuildings under construction. With light blue, we have the vessels that are on time charter with profit sharing, we have 13 vessels. And with dark blue, the vessels that are on fixed-rate time charters. We have 39 vessels.

In the next slide, we list the pro forma diversified fleet, which consists of our 4 LNG vessels, 2 in the water, plus 2 newbuildings, and our 16-vessel shuttle tanker fleet. We are one of the largest shuttle tanker operators in the world with a fleet [indiscernible] and technologically advanced vessels.

On July 28, we took delivery of the 2 DP shuttle tanker Anfields from Samsung Heavy Industries in South Korea, the third in a series of 12 DP2 shuttle tankers under construction at that yard. The vessel commenced a 10-year employment to a U.S. oil major with charter options to extend until the vessel's 20th year anniversary. Assuming charterers employ the vessel to the maximum duration, the expected gross revenue should approach $500 million.

Following the Anfield delivery, we have 7 chartered tankers in full operation. If we combine the 2 slides and account only for the current operating fleet of 62 vessels, we have 23 vessels or 37% of the operating fleet with market exposure, spot and time charter with profit sharing, while 52 vessels or 84% of the fleet is in secured revenue, which is time charters and time charters with profit sharing. In the next slide, we list our clients with whom we do repeat business through the years, thanks to our industrial model. ExxonMobil is the largest revenue client. Equinor, Shell, Chevron, TotalEnergies and BP follow.

The left side of the next slide presents the all-in breakeven cost for the various vessel types we operate in TEN. Our operating model is very simple. We try to have our time charter vessels generate revenue to cover the company's cash expenses, paying for the vessel operating as finance expenses for overheads, chartering costs and commissions and net revenue from the spot and profit sharing trading vessels to contribute to the profitability of the company.

Thanks to the profit sharing element, for every $1,000 per day increase in spot rate, we have $0.11 positive impact on the annual earnings per share based on the number of vessels that currently the company has exposure to spot rates, which is 23 vessels. We have a solid balance sheet with strong cash reserves. The fair market value of the pro forma of the fleet is approximately $4.9 billion against $2 billion debt, and net debt to cap is around 44.5%.

Fleet renewal and investing in eco-friendly vessels has been key to our operating vessel model. Since January 1, 2023, we have further upgraded the quality of the fleet by divesting from our first-generation conventional tankers, replacing them with more energy-efficient newbuildings and modern secondhand tankers, including, of course, dual-fuel vessels. In summary, we sold 20 vessels with an average age of 17.3 years and capacity of 2 million deadweight ton and replaced them with 35 contracted and modern acquired vessels with an average age of 0.5 years and 4.8 million deadweight ton.

We announced today the sale of 2 2006-built Suezmax tankers to independent third parties for net proceeds of $100 million. Prior to the sale and as previously reported, the vessels were part of the sale and leaseback structure, then repurchased them for cash upon maturity of their lease at a significant discount to fair market value.

And as we continue to transition our fleet to greener and dual-fuel vessel, we must note of our well-timed newbuilding program and how well is in the money today. Our 26 newbuilding vessels that were contracted in 2003 are today at much lower levels than current newbuilding prices. In a newbuilding program of approximately $3.1 billion cost, we have today at least a 30% appreciation in value, even before some of these vessels are delivered to the company.

Tanker market fundamentals have remained strong, with the global order book still at a level equal to about 40% of the number of vessels that are 50 years of age or older, and shipyards operate at full capacity, while at the same time, geopolitical conflicts continue to increase ton-mile dislocation, and that provides further support to an already robust tanker market.

And with that, I will pass the floor to Harrys Kosmatos, who will walk us through the financial performance of the first half. Harrys?

Thank you. Thank you, George. So let me start with a brief summary of our 6-month results. So favorable tanker market fundamentals, continuous geopolitical tensions, along with the over trading inefficiencies that have been created continue to propel the market to levels that, on the one hand, incentivize owners with a long-term outlook to fix for longer periods as demand for term tonnage remains unabated, while on the other, encourage the divestment of vessels of all ages for lofty profits.

TEN, since the beginning of the year, has been active on both fronts and has reaped the benefits of such an extraordinary confluence of circumstances. The results of the first half and second quarter of 2026 are a vivid reflection of that. Benefiting from a modern, versatile and efficiently operated fleet catering in its majority to the long-term needs of our clients, fleet utilization in the first 6 months of 2026 was almost identical to the 2025 first half level at 96.5% despite having 6 ships undergoing scheduled dry docks from 5 in last year's first half.

As a result of the fleet operating at almost full capacity with an employment policy inclined towards long-term charters with upside optionality through vessels operating under spot and profit sharing contracts, gross revenues during the first half of 2026 increased to well over $0.5 billion, $551 million to be exact, or $161 million above the 2025 first half level. This was accomplished with an average fleet of 63.5 vessels, just 1.5 vessels above the 2025 first half fleet, quite an achievement.

Of interest, profit-sharing arrangements contributed $71 million of revenue during the first half of 2026 compared to $10 million in the 2025 same period. This substantial increase occurred despite a 22% decline in actual operating days under market-related contracts, while available days on fixed time -- fixed-rate time charters rose by 23% over the corresponding periods.

The time charter equivalent rate per ship per day impacting the above results, and by extension, reflecting the continuous robustness of the tanker market and operational efficiency of the fleet reached $43,503 per day from $30,754 per day in the 2025 first half, a 41% increase. Fleet voyage expenses in the first half of 2026 climbed to about $82 million from $68 million in last year's first half, the result, to a large extent, of increases in [ bunker ] prices of about 25% impacting vessels operating spot.

Vessel operating expenses during the 2026 first half reached $111 million from $102 million in the 2025 same period, a modest and expected increase, the result of the slightly bigger fleet, higher dry docking expenses and the customary inflationary pressures. On a per ship per day basis, this translated to $10,298, about 1/4 of the TCE rate mentioned above.

Depreciation and amortization expenses, again driven by the increased size of the fleet, which included the delivery of 2 MR product tankers and the repatriation of 2 Suezmax tankers from 5-year operating leases, came in at $90 million from $83 million in last year's first half. General and administrative expenses at $27 million from $23 million in the 2025 first half reflected a somewhat higher management performance-based compensation from the 2025 first half level and inflationary pressures.

As a result of all the above, TEN for the first half of 2026 generated operating income of $273 million from $111 million in last year's first half, inclusive of $38 million and $3.6 million of capital gains, respectively, an increase of 146%. Despite an increase in our financial obligations related to the growth of the fleet, $2.1 billion at the end of June 2026 from $1.8 billion at the end of June 2025, interest and finance costs fell by $5.6 million, the result of lower global interest rates and lower spreads on new and refinanced loans. Interest income, on the other hand, remained similar to last year's equivalent period at $5.6 million.

Reflecting the performance outlined above, the result of commercial and operational efficiencies as well as positive market fundamentals, the net income generated by the company reached one of the highest levels in recent memory, $228 million from $64.5 million in the equivalent 2025 first half, a 253% increase. Now if we were to exclude the capital gains recorded in both 2026 and 2025 first half period, as some of you are accustomed in doing, the 2026 first half net income experienced a 112% increase from the 2025 first half, or in dollar terms, $129 million more.

In terms of EPS, earnings per share of $7.12 in the first half of this year from $1.70 in last year's first half. In other words, a 318% increase. Adjusted EBITDA for the period was higher by $131 million from the 2025 first 6 months and reached $324 million, a 68% increase. Cash at the end of June 2026 stood at $466 million, $179 million above the June 30, 2025 level and $168 million above cash balances at year-end of 2025.

And now let's go quickly on our Q2 results. Following the above pattern and again, by operating the fleet of 63.5 vessels from 62 in last year's second quarter, with 4 vessels on dry dock to 3 in the 2025 same period, gross revenues climbed to $298 million from $193 million in the 2025 second quarter, a $105 million increase. Project expenses during the second quarter of 2026 increased to $52 million from $32 million in the corresponding 2025 quarter -- second quarter, primarily reflecting higher bunker prices affecting vessels operating in the spot market. Spot market employment accounted for approximately 12% of total fleet operating days during the 2026 second quarter.

Operating expenses on the 63.5 vessels in the fleet were $57.7 million, or a $5 million reduction from the 2025 second quarter, primarily due to the slightly larger fleet and an extra vessel over the 3 that underwent special surveys in the second quarter of 2025. Depreciation and amortization expenses for the 2026 second quarter period were $46.3 million from $42.1 million in the 2025 second quarter, the result of the marginally larger fleet and the reintroduction of the 2 Suezmaxes mentioned earlier.

General and administrative expenses during the 2026 second quarter reached $14.8 million from $13.2 million in the 2025 second quarter, a marginal $1.6 million increase. Interest and finance costs in the second quarter came in lower from the 2025 second quarter, $22.6 million from $25 million, or a $2.3 million reduction. On the other hand, interest income during the 2026 second quarter was marginally higher than the 2025 equivalent period at $3.4 million.

Reflecting the above performance, the net income for the second quarter of 2026 after a $38 million capital gain climbed to $139.3 million from $26.8 million in last year's second quarter, which, unlike this one, had no gains or losses recorded. In terms of EPS, the above figures translate to $4.40 for this year's second quarter compared to $0.67 in last year's second quarter, a 557% increase. In ending, adjusted EBITDA for the second quarter of 2026 was 81% higher from the 2025 second quarter to reach $170.4 million, or $76.5 million higher.

And with this, I'll pass it back to Nikos. Thank you.

Thank you, Harrys. I think that has been a very detailed presentation of the growth of the company. I mean, we've been operating a similar size ship if you go back, George, to the slide over the years. And you will see that we have been operating a fleet of similar size for the last 10 years, where you see the financial statistics of where you go.

So I think we've been operating a fleet of around 60 to 65 vessels for the last 10 years. And of course, there, you can see the big effect, the growth of -- the cash growth of earnings, the growth of EBITDA. And hopefully, 2026 will be a milestone year for -- I think as Nic Bornozis said, the company will be exceeding revenues of $1 billion significantly, and of course, a very strong EBITDA.

And with this, I would like to open the floor for any questions.

[Operator Instructions] Our first question comes from the line of Poe Fratt with Alliance Global Partners.

Harrys, I would just like to clarify the profit sharing contribution for the second quarter. I think I heard you say that the first half contribution was $71 million, and I had the first quarter contribution of $40 million. So was the second quarter contribution $31 million?

No, you rightly heard. The contribution for the first half of '26 was $71 million. While last year, it was $10 million, $4.5 million and kind of $5.6 million. That was the profit share we received at the same period last year. So effectively, we generated 7x more the profit sharing that we did this time last year.

And an interesting tidbit is that for the entire 2025 period, the profit share was at $46 million. So you can imagine at $70 million in the first half that things are looking rosier.

Yes. I just wanted to clarify what the contribution was in the second quarter?

Sorry. In the second quarter of '26, it was $30.5 million, correct.

Okay. Great. And then...

[ 30.5 ].

Yes, that's helpful. And then can you help me understand the outlook for the second half of the year from a profit sharing standpoint? It looks like some of the [ Vs ] may have moved on to profit sharing agreements. And so relative to the second quarter, should we see the profit sharing contribution increase or stay about the same? Just any color would be helpful on the profit sharing contribution.

Well, we're expecting significant increase in profit sharing for the second half of the year. We have renegotiated drastic increases in minimums. And also, the profit sharing arrangements are much more favorable to the owners. As I said, the charters are very eager to employ good quality vessels, and so they are much more giving.

And of course, at the same time, it's a win-win situation because, as you know, the refinery margins are on all-time highs. So our clients, and we're very happy about that, are making very good returns. So they are not stingy in sharing some of the returns with us, the transporters.

No, it's very positive, Poe, because we have 13 vessels today on profit sharing arrangements, 9 of which are of the bigger sizes, Suezmaxes and VLs. So we have 7 Suezmaxes and 2 VLs in profit sharing arrangements. So as you can imagine, we expect that the profit sharing will be quite meaningful going forward.

We'll be able to offer turkey for Thanksgiving it seems this year.

I hope with a lot of stuffing. When you look at the asset sales program, you sold 2 in August. Can you just highlight the gain that you're going to report in the third quarter from those sales? And then more importantly, what other assets might you sell over the second half of the year, looking into the first half of '27?

Well, as I said, we look at those vessels, all the vessels that are in the list have been bid by then on behalf of our clients. We're still the same, the actions, the [indiscernible] 20 years ago or 15 years ago. So they are very good quality ships. I have to drag them out of our newbuilding department because they get sentimental with this.

But actually, the next phase is going to be -- I would be sentimental also because it's a vessel that is older than my kids. So I think it's one of our older ships beyond this, which was built around 2003. So she's going to be the next one to go.

And of course, for further trading. She's been trading for one of the big majors since she was built. And the major wants the vessel up to now, keeps on chartering the vessel up to now at very, very healthy rates. But I think there's always a time to -- when someone becomes of legal age of 21 and over, we let them go.

Got you. And then can you just talk about your appetite for newbuilds? I thought I heard you say that newbuild pricing has moved up where it's less -- maybe -- I thought I heard you say less reasonable than it was. What should we expect on the newbuilding side as we look out over the next 12 months?

Well, for us as a company, we are actually very busy right now absorbing one of our largest growth, I think a big milestone of 26 vessels with a cost of $3.2 billion. And we still have to take over 19. And I think we're going to see a huge effect to our earnings, to our revenues because 3 VLs are coming in.

And of course, our VLs, we just -- less than a year ago, we contracted them, and they have almost, I would say, doubled the price since then. So today, we decided not to sell them. As contracts, we would almost double the price that we ordered them. And the same goes for all our 26 newbuildings.

So I think we are not right now -- and we are actually -- to be correct, we are looking again at vessels with long employment, specialized vessels like the shuttle tankers against accretive long-term contracts. But I think we are very well placed. We're in a good place, and we still have 19 newbuildings that are well into the money to take delivery of.

Great. Yes, I think you said that 30% higher than your $3.1 billion stated program, so closer to market value of $4 billion.

[Operator Instructions] Our next question comes from the line of Climent Molins with Value Investor's Edge.

You hinted that higher distribution going forward, which makes sense considering your financial position and the free cash flow you're currently generating. In the past, you had mentioned potentially declaring, let's say, supplemental dividends as net proceeds from asset sales roll in. Could you give us an update on this front? It's obviously a discussion for the Board, but any color you can give us?

Sure. Well, I think our intention is to significantly reward or increase the reward to our shareholders because I think, as our Chairman said, we like to share. Being the major shareholders ourselves, we'd like to share the upside with them. So we're looking forward for a nice dividend announcement after our strategy meeting in November.

And on the special dividend, we did it a couple of times, but we were told off by the analysts because it complicates -- and nothing likely so. It complicates -- they do not know if this is something is going to be recurrent or not. So I'd rather add or increase the normal semiannual dividends because we need to keep our analysts happy and less confused rather than doing a special dividend. They felt that, that was something that was a onetime event and got wasted, whereas when you have a company that has significant cash flow, significant cash -- I mean, as Harrys, I think, referred to, our cash since the 6 months has also grown in a big way.

And down the road, we have our perpetual preferred, which is $120 million at 9.25%. And we are considering that actually taking this out. It's not an obligation, but I think it will be a very good use of cash. It will add anywhere between $0.30 and $0.40 to the bottom line just by saving on the high coupon. So I think this is -- and of course, continue to invest in our newbuilding program.

Yes. Taking off the preferred definitely makes sense. And the special dividend is not that confusing, but obviously, it's a Board decision.

So I have another question on the dividend. Is there any appetite to potentially move to a quarterly payment schedule? I mean, all your peers follow that model. So I was wondering whether this is something you'd consider?

Well, we actually have moved, I think, about 10 years ago from a quarterly dividend to a semiannual dividend because for many reasons, for logistical purposes -- I mean, shipping is operationally a more complicated business. We are not land block, we're not land-based. It's not like we have 5 or 10 factories in various states that they produce. We have ships all over. I mean, sometimes a voyage takes more than a quarter. So I think it's more appropriate for shipping.

And I think even the President of the United States referred to it about a year ago, saying that the quarterly dividends takes a lot of time, from management time, CFO time. And also, it's not actually -- does not portray the actuality of the business. So I think the short answer is we would maintain the semiannual dividend because I'd rather be able to give a big semiannual dividend just rather than smaller quarterly ones.

Does that complete your question?

Yes.

Our next question comes from the line of Poe Pratt with Alliance Global Partners.

Nikos, on the last couple of calls, you've talked about potentially doing a restructuring of the company and maybe carving out the shuttle tankers or other assets that are in long-term charters. Can you update us on any progress on that plan?

Well, I think restructuring is something that our company, for 33 years, we have never had to do. So I think perhaps replanning could be the word because I guess I'm taking the opportunity from what you said to see that TEN is perhaps one of the very few companies that we have never restructured or renegotiated any of our loans in the last 33 years. So we've been paying our obligation, paying dividend continuously, paying our lenders continuously and then maintaining a steady ship.

I mean, the company is looking at ways to add more value. We will not reduce the size of the fleet. We might consider, again, closer to the end of our newbuilding program to carve out a small part of our fixed, I would say, the long-term fleet, about 20 vessels. But within TEN, it will be within TEN.

I mean, we are approached by a lot of investors who would like to participate in what we said. I think it's on Page 5, which is -- it's called TEN special. It's like a pizza. So it is -- you see the 20 vessels there. And those ships have very long employment and 10, 15, 20 years. And they could -- they appeal to some shareholders that would like to invest into that. But everything would happen within TEN. TEN would maintain at least 60%, 70% of the fleet. So it's not really the ships will not be out of the company.

We have no further questions at this time. Mr. Tsakos, I'd like to turn the floor back over to you for closing comments.

Nikolas, on the last comment, I'd like to just add, if I may, that this is not at the top of our list right now. It's not something that is in the near future.

Exactly. Exactly. It's not on the top of our list, but it is another way that we consider to prove the hidden value of those ships that have a very long employment. But always, if something happens, it will be within TEN. So really, TEN shareholders will not be affected at all. The fleet will maintain its big size, but perhaps a big shareholder will specifically invest as a minority holder in these assets. But again, as the Chairman said, this is more food for thought at this stage. Thank you, Chairman.

And with that, again, I would like to wish everybody a good beginning of the new season. We're looking at a healthy period from now to the end of the year. It is -- we are actually literally operating in a operational minefield. So not only we have to maintain a steady course, but geopolitical events, mainly in the Middle East, are making the daily business change as we speak. And the decisions we have to make, always with responsibility to our seafarers, I mean, our crews and of course, the safety of the vessel, the safety of the environment because those ships are carrying huge quantities of oil and we don't want to put them in danger.

Saying these circumstances have created an unprecedented strong market. I think the rates right now in the Gulf area, which as you know, has been also attacked by the [ hotness ], or it sounds like a movie, the [ hoodies ] are close to $800,000 a day, approaching $1 million a day for a VLCC in the Gulf. So this is unchartered territory which we are taking advantage of carefully and steadily.

We all would like the world to be completely peaceful even if we didn't make the returns that we are making because it will make the sustainability of our business going forward much better. And in the meantime, we are taking advantage of the situations. We are one of the biggest companies in Venezuela. Our vessel was the first vessel to lift legal cargoes finally from Venezuela. The Russian situation also is putting almost 25% of the world fleet out of the market. So we are looking at least for the next year, at good and growing prospects.

And we will be attending -- the management will be attending the Capital Link and other events at the end of the month. So we would like to be able to make -- to see as many of you live in the United States and also Europe.

And with that, we would like again to thank you for your support. And I have, as we said, always remember 9/11 as a very special day for the world and of course, for us and the company. Thank you very much.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.

Thank you for standing by, ladies and gentlemen, and welcome to the Tsakos Energy Navigation Conference Call on the First Quarter 2026 financial results. We have with us Mr. Takis Arapoglou, Chairman of the Board; Mr. Nikolas Tsakos, Founder and CEO; Mr. George Saroglou President and Chief Operating Officer; Mr. Harrys Kosmatos, CFO of the company. [Operator Instructions] I must advise that this conference is being recorded today.

And now I pass the floor over to Mr. Nicolas Bornozis, President of Capital Link, and Investor Relations Adviser for Tsakos Energy Navigation Limited. Please go ahead, sir.

Thank you very much, and good morning to all of our participants. I'm Nicolas Bornozis, President of Capital Link, and Investor Relations Adviser to Tsakos' Energy Navigation.

This morning, the company publicly released its financial results for the 3 months ended March 31, 2026. In case we do not have a copy of today's earnings release, please call us at 212-661-7566 or e-mailer [email protected], and we will have a copy for you e-mailed right away. Please note that prior to today's conference call, there is also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please we urge you to access the presentation slides on the company's website. Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user controlled, and that means that by clicking on the proper button, you can move to the next or to the previous slide on your own.

At this time, I would like to read the safe harbor statement. This conference call and slide presentation of the webcast contains certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, which may affect TEN's business prospects and results of operations.

And at this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos' Energy Navigation. Please go ahead, Mr. Arapoglou.

Thank you, Nicolas. Good morning, good afternoon to everyone. It's even another time when the TEN model has proved it works in good and in bad markets, that's the way structured. It's being run as a portfolio of vessels rather than a number of individual vessels. This has led to sustainable profitability throughout the year, while continuously increasing dividends. It was just highlighted to me that the total dividend per share paid since inception to every preferred or common share of TEN is $1 every year. So while at the same time renewing fleet and always maintain a cash buffer of about -- well above 350, although this number increases in -- as the quarters roll out. This number, it's not a static number. It's a number that rolls over through the sale and purchase situation. So it's not because we want to have 350 studies there, that is the policy to be able to have either a buffer or the ability to make acquisitions. At the moment, this model has booked upfront revenues for the next 2 years of $3.6 billion of all kind of charges, which is part of the same that we have, and all this is benefiting. Allow me to say, in a way, ironically from strong market fundamentals. The result is continued strong business growth, as evidenced by the steadily increase in stock price, which I'm sure you have noticed.

Thank you all. I now wish to once again congratulate Nikolas Tsakos and his team for the excellent performance on all fronts. Nikolas, the floors is yours.

Chairman, thank you very much, and good morning and good afternoon to everybody. It's with great pleasure that we announce another successful and a very productive quarter. However, the first quarter is, as I said, or as it was said in our press release is reflects market conditions, market fundamentals and has a small effect. Its latter part on geopolitics. However, the quarter that we are actually into now, and we were more than halfway into the second quarter, is a quarter that when we will report, it will be -- we will have the very strong market effects. So it's going to be, or it looks like it's going to be a much stronger quarter either than this record quarter because of geopolitical FX. And of course, the company is placed in a way over the last 33 years that it can sustain prolonged period of crisis and also grow at the same time, modernize at the same time and distribute significant dividends to its shareholders having the, I would say, the management being the largest shareholder since inception of this company and continuing growing its shareholding.

And I think the statistic our Chairman mentioned is that through thick and thin since -- we've been 24 years public on the New York Stock Exchange and 33 public -- 33 years public all over. This is a period that we have been able to pay an average of $1 a share to our shareholders, both to our 30 million outstanding shares of the common stock and the 10 million or 10-plus million of our preferred. So this -- so as I said, the year started with defense in Venezuela. That created, again, this location but opened new ton miles and new barriers and then, of course, more than halfway in the first quarter. We have had the Hormuz Strait, which as we speak right now, has really isolated more than 20,000 seafarers who are dropped for the last 3 months. So we have very important issue with -- for our seafarers, a grave situation. And of course, we are in a situation where almost 5% of the world's tonnage is being blocked and this is a big number. But even more than that, more than 10% of the world's VLCCs, which are the vessels and user trade, the Hormuz Strait are being booked. So it's a time of dislocation that has created opportunities. We -- as many say, we prefer for us to earn a living when the seas are open, when there are no tariffs, there's no sanctions, but we have to navigate things the way we are.

And with that, George, would you like to give us a bit more detailed, developments of what has happened. It's been, as I said, operationally, emotionally because of the human factor, a rollercoaster over quarter. And we had to think more than once outside the box to be able to navigate and maintain an efficient -- the efficient change of supply of energy for our clients.

Thank you, Nikolas. We are pleased to report today on another profitable quarter. We maintained a steady course in the most turbulent geopolitical environment in recent memory. The year started with a political development in Venezuela and escalated with the war in the Middle East and the closure of the Strait of Hormuz. Even before geopolitics took center stage at the end of February, tanker market fundamentals were strong. 2026 was forecasted to be another year with growth in global oil demand. With its passing year after 2022, establishing a new record for all demand, while at the same time, [indiscernible] remained very balanced. Since March and so far, for the more part of the second quarter, geopolitical events have significantly added to the market strength.

TEN's diversified fleet with its new charter renewal, together with the spot fleet and the profit sharing market exposure will continue to further benefit from this unprecedented market dislocation. We have a 33-year history as a public company. From 4 vessels back in '93, we have turned every crisis the world and shipping has faced through the years into a growth opportunity. Today, TEN is one of the largest energy transporters in the world with a young diversified, versatile pro forma fleet of 83 vessels.

In Slide 4, we list the pro forma flip of 4 conventional tankers, both crude and product carriers. The red color shows the vessels that trade in the spot market, and we have currently 11 tankers and are new buildings under construction. With slight blue, we have the vessels that are on time charter with profit sharing, 12 vessels, and we start grew the vessels that are on fixed rate time charters, 40s.

In the next slide, we have released the pro forma diversified fleet, which consists of 3 LNG vessels plus 1 LNG newbuilding auction and our 16 vessel shuttle tanker fleet. We're one of the largest shuttle tanker operators in the world with very young and technologically advanced vessels. We have 6 shuttle tankers in full variation after we took delivery of both Athens 04 and Paris 24 last year, which immediately commenced long time charters to an energy major. If we combine the 2 slides together and account only for the current operating fleet of 63 vessels, 23 vessels or 37% of the operating fleet has market exposure that is spot and time charter with profit saying, while 55 vessels or 83% of the fleet is in secured revenue contracts, that is time charters and time charter with sharing.

In the next slide, we list our clients with whom we do repeat business through the years, thanks to our industrial model. ExxonMobil is the largest revenue client followed by Equinor, Shell Chevron, Total Energy's NBP. We believe that over the years, we have become the carrier of choice to energy majors, thanks to the fleet that we have built, the operational and safety record, the disciplined financial approach, the strong balance sheet and the strong financial performance.

Slide 7 presents the all-in breakeven cost for the various vessel types we operate in the company. We have a very simple operating model. We try to have our time charter vessels to generate enough revenue to cover for the company's cash expenses that is paying for vessel operating and finance expenses for overheads, chartering costs, commissions, and we let revenue from the spot and profit sharing trading vessels made contributions to the profitability of the company.

Thanks to the profit-sharing element, every $1,000 per day increase in spot rates, has a positive $0.13 impact on the annual earnings per share based on the number of 10 vessels that currently have closure to the spot rates, 23 vessels. We have a solid balance sheet with strong cash reserves. The fair market value of the operating fleet exceeds $4.6 billion against $2.1 billion of debt and net debt to cap is around 48.4%. Fleet renewal and investing in eco-friendly greener vessel has been key to our operating model.

Since January 1, 2023, we have further upgraded the quality of the fleet by divesting from my first generational conventional tankers, replacing them with more energy-efficient new buildings and modern secondhand tankers, including dual fuel vessels.

In summary, we sold 18 vessels with an average age of 17 years and capacity of 1.7 million deadweight ton and replaced 34 million contractors and modern acquired tankers with an average age of 0.5 years and 4.7 million deadweight capacity. We announced today the sale and delivery to her new owners of a 10-year-old VLCC, intense agreement to buy until the end of July 2, in the money, 2007 Bill Suzmax tankers currently operating under a sale and leaseback agreement. We continue to transition our fleet to greener and dual fuel vessels. We are currently one of the largest owners of dual fuel LNG power Aframax tankers with 6 vessels in the water.

Tanker market fundamentals remain positive with the global order book still at a level equal to about 1/3 of the number of vessels over 15 years of age. CPRs are operating at full capacity scrapping activity is increasing and global oil demand is at record reverts. The recent war in Iran, which resulted in the closure of the Strait of Hormuz has provided further support to an already robust tanker market.

And with that, I will pass the floor to Harrys Kosmatos, who will walk us through the financial performance of the first quarter. Harrys?

Thank you, thank you, Georgios. Well, as both Nikolas and Georgios mentioned, 2026 started on a high note for the tanker markets as they went in Venezuela and allowed for more barrels to be transported on non-sanctioned vessels, adding to global ton miles, already at high levels as a result of the war in Ukraine and the ongoing sanctions of Russian exports. On top of that, the war in Iran, which has led to over 5% of the global tanker fleet to be stranded within the present Gulf has made countries like China and India to seek barrels from alternative sources, primarily from the Atlantic Basin, added further miles to global seaborne transportation. Against this backdrop, which spurred measure oil companies to secure reliable tonnage for their long-term needs with its modern fleet and operational expertise was a prime beneficiary, which resulted in fleet utilization, almost touching but practically unattainable the perfect 100%. 98.3% compared to 97.2% in the 2025 first quarter.

Quarters where each had just 2 vessels undergoing scheduled dry dockings. This, combined with the fleet slightly larger than the one of the 2025 first quarter, both in terms of vessels and deadweight tons and vessels under secured revenue contracts that is fixed time charters or time charge with profit provision were 15% higher than the 2025 first quarter. An assisted TEN generate [indiscernible] revenues of $253 million, $56 million higher from the first quarter of 2025. The result in time charter equivalent rate per seat per day, reflecting the continuous robustness of the tanker markets reached almost $41,000 per day from about $31,000 per day in the 2025 first quarter, a 33% increase. The significant reduction of vessels operating in the spot rates, 48% lower from the 2025 first quarter resulted in a $6.2 million drop in voyage expenses to settle at $29.8 million.

Vessel operating expenses during the 2026 first quarter were at $53.3 million from $49.6 million in the 2025 corresponding quarter, a modest increase as a result of a bigger fleet in terms of vessels and deadweight tons. The resulting operating expenses per seat per day came in at a still competitive 9,952, about 1/4 of the TCE rate mentioned above, a very comfortable level. Depreciation and amortization expenses reflecting the increase in vessel sizes since the end of the 2025 first quarter came in at $44.1 million from $41.1 million in the last year's same quarter.

General and administrative expenses were at $12.4 million from $10 million in the 2025 first quarter, a still competitive level in the fleet of over 63 vessels. As a result of all the above 10% for the first quarter of 2026, generated an operating income of just about $110 million without having any gains or losses from vessel sales. From $57 million in last year's first quarter, net of a $3.5 million capital gain. In other words, a $53 million increase or 93% higher from the levels of the 2025 first quarter.

Despite an increase in our overall loans to correspond to the growth of the fleet, $2.1 billion this quarter and $1.9 billion at the end of the 2025 first quarter, interest cost fell by $3.2 million, the result of a lower interest rate environment and lower spreads. Interest income remained more or less the same as last year's quarter at $2.2 million.

Reflecting the performance, both in terms of commercial and operational efficiencies and positive tanker market fundamentals, the result in net income reached one of the highest levels over the last 10 years. $89 million from $37.7 million in the 2025 first quarter, 136% increase or in [indiscernible] terms, a $51 million betterment.

In terms of earnings per share, $2.72, this time from $1.04 in last year's first quarter, with a normal similar share count. Adjusted EBITDA for the quarter was higher by almost $55 million from the 2025 first quarter at $154 million, a 55% increase. These results have enabled the company to reward common shareholders with a handsome dividend, $1 per common share to be paid within July of this year, which is 67% higher than we paid at the same time last year, or if we were to include the February $0.50 payment, which we showed 36% higher from the total distributions made during 2025 from $1.10 in 2025 to $1.50 today, a very healthy $45 million distribution.

And on this happy note, I'll pass it back to Nikolas. Thank you.

Thank you. Thank you, Harrys, and I hope you keep on bringing a happy news in the quarters that follow. Again, I think as we said, it's been a period that we have not seen before. In general, the last 6 years have been years of continuous turmoil. We started for all of us remember, we started with the pandemic with COVID. All over a sudden, we had the world pausing for a while. And then we had the events in Ukrainia followed the Middle East almost by October '24 and then followed by the events in -- the more recent events. So it's been -- geopolitics have been driving part of the market. But even looking under those effects, the market still has legs, has good fundamentals. And we believe that in a peaceful normalized open-border world, the market will continue to be healthy.

And with that, we would open the floor for any questions.

[Operator Instructions] Our first question comes from the line of Omar Nokta with Clarkson Securities.

Just a couple of questions. And maybe just first, perhaps maybe a big picture on the shuttle tankers. That segment provides a good amount of revenue visibility and also built-in earnings growth, and that's obviously been built out quite a bit here over the next couple of years as you take delivery of those new buildings. How do you envision that business looking forward after those ships deliver? Do you kind of think that they coexist within the broader conventional tanker business? Does it stay within TEN, or do you consider carving that out as its own separate vehicle?

Well, it's -- we are open to suggestions from people of your experience, not only, but I mean we are working as exactly one entity right now. Our new building department is busy, making sure that the sea trials are happening and the ships are being delivered. So the focus right now is the operational focus. We're not planning to do the first -- well, the third delivery of the series is at the end of July. I think sea trials are taking part in [indiscernible]. And the ships are state-of-the-art very modern vessels at one of the best years in the world. But I think we have time to take this decision or no decision has been taken, but right now, they are an integral part of TEN.

And then a follow-up just on the LNG business. you recently ordered that when a new building plus one option. What does it look like in terms of employment opportunities now? I know there's been this interesting kind of stunted LNG market where there was concern for this year that we were oversupplied. But that as you looked out towards '28, '29 as that vessel delivers or those $ would deliver, there's a lot more -- it's much more constructive what does the charter market look like? Or what does interest look like for securing that shift today on a long-term contract?

Well, I mean the market right now is in turmoil because you know better than me part of the fleet and part of the production is being trapped or kind of damaged, so I wouldn't say that today really reflects things going forward. The market is still [indiscernible]-ish, I think you can see fixtures, which I don't consider something that would be interested starting for 5 or 7 years in the 80s. We are following this market closely. We have been initially one of the first movers in this market back when we took delivery of our first steam turbine the new energy. But being a diversified fleet, we have the luxury that we do not have to run under every single, low-digit, mid-digit business that is out there like most of the companies that just specialize in gas. So we have another 78 vessels at least to carry forward. And for us, it's a market which is very interesting operationally. We believe there is a future, but it's not a market that we are depending on. And that's why we're taking smaller steps, all of them depending on developments of technology.

And if I may add, there is very strong energy demand throughout the world. Demand is going up. And there are no indications that this demand will dry up anytime soon.

That's very right what Chairman says. We have very strong indications for energy demand, including gas from all our clients. I mean today, we could charter all our uncharted new buildings, including our later delivery VLs, which we ordered -- TEN ordered in very timely manner 6 months ago. But we have the luxury to have more than $3.5 billion of backlog and waiting for the right trade and the right opportunities with the right client going forward.

Okay. That's clear. And then maybe just one final one, and I'll hop off the queue. Do you mind just maybe mentioning that [indiscernible] princess that you referenced in the release, loading the Aframax cargo using road trucks. Can you just talk about what that is in terms of -- is that a means to bypass the Black Sea, and how do you see this application being used in other areas?

I think Omar, it's closer to your parts of the world. It's bypassing the red sea. And of course, they are more straight. This was one of our big Middle East clients wanting to load from these parts of the world. But we felt that it was too risky for our seafarers and for the for the crew and for the vessel and for the cargo. And so we gave them the idea and they came with it to load from Eastern Mediterranean on product that was carried by 7,800 trucks. Actually, the loading took about two weeks. But it's -- we have to try and think out of the box. It was successful. We were able to maintain [Audio gap], for crude were able not to have to shut down. And that -- we're just -- we are just the messages. We just carry the stuff. So we try to do the most we can do safely to make sure that the energy chain continues.

Our next question comes from the line of Poe Fratt with Alliance Global Partners.

I have a couple of questions. The first of which is, can you just talk about the knock-on impact of cargo switching to the Atlantic. I've heard on another call that there's a squeeze on transits through the Panama Canal. Can you confirm that and sort of discuss what sort of the impact is on the overall flows would be?

Yes. So again, good morning to you. It goes back to the new routings, and that's another marginate way. We've been seeing increasing calls to the Far East this time through the Panama Canal. And of course, this really triples the ton mile distance. And yes, it's more activity in the Atlantic, but it's actually through passes through the canal. So you do West Africa through Panama Canada to the Far East, which is really something that we would have never thought of 6 months ago. These way you avoid having...

And is -- are transit starting to become an issue there, Nick -- Nikolas, or is that sort of a minor issue in the scheme of the global trade?

I think the way we see it, if things do not normalize in the next 3 months, we will be seeing more delays also happening on that side on the scan.

Okay. Great. And then Harrys, in the last conference call, you talked about the impact of profit sharing on the fourth quarter operating results. Do you have a number on the impact for the first quarter results from profit sharing agreements?

Hi, Poe. Well, let me answer this differently. I mean, last year, in the last quarter, when we spoke last time, we made $27 million from [indiscernible]. And for the entire year, for the entire '25, [indiscernible] revenue came in at $45 million. So far this year, in the first quarter alone, [indiscernible] revenues are in excess of $40 million. So as you can imagine, we are very comfortable that this trajectory will...

That's a good number, that's a good number.

We're not ready on the number that we made last year in just the first quarter.

Yes. That's really helpful. And then can you just talk about your operating expenses looking forward? And it looked like there was a a onetime impact to G&A of about $3.5 million just due to the exchange rate changes last year. Can you just talk about G&A levels going forward too?

Well, we believe that we will be able to maintain them. However, the dollar has weakened on us and our major expenses, I would say, the euro -- so yes, this is an effect we might have. But again, it's a marginal cost in comparison and would where we are. And I think what we're also very focused on is to maintain big running expenses in this demanding environment steady, and we were able to be under $10,000 on an average, very diversified fleet, which includes anything from LNG to shuttle tankers down to the MRs. So yes, I mean, the euro is -- I mean, the Europe, the weak dollar has an effect on our balance sheet.

Okay. Great. And then looking into July, it looks like you're going to buy into sale leasebacks. Can you quantify the amount you're going to spend there?

We cannot give all the secrets. But anyway, I will -- Harrys comes up with imaginative ways of describing things, but being from [indiscernible]. But the -- I would say that we are buying assets that we -- that have been working for us that we have built on the lease back at less than 50% of their current market value, less than 50% of the current market value. So it's going to be a good situation.

[Operator Instructions] Our next question comes from the line of Climent Molins with Value Investor's Edge.

I want to start by following up on Omar's question on the LNG side. Could you clarify until one is the option you hold for a second new exercisable, and how do you mine thinking about that?

Well, we have, as you I'm sure know, you've seen we have our AGM nicely time next week just before the poison events, here in Greece. And I think that's when we will be discussing with our Board the option of going forward. So it won't be that long. I think we'll have in the next couple of weeks. Within this quarter, we will have -- we will take a decision.

Okay. Makes sense. And you sold your leases at very slight pricing. As you think about your fleet positioning, is there, let's say, any appetite to push additional sales over the coming months. You have several [indiscernible] and even some smaller vessels built for 2010. How do you balance the free cash flow that you're currently generating in the market versus a potential sale?

So this is a very good point. And I mean, this is what we try to do is to balance, as I said, our aim is to part with our first-generation vessels. And I think the market conditions today are making -- giving us a lot of sense. So we will be seeing, I would say, a maximum of half a dozen sales. Don't forget, we have a new building program of 26 vessels is the largest newbuilding program than any of our peer group by far, thanks for a newbuilding department here. And we have taken delivery of 4 of those vessels so far, too late last year and too early this year. So we still have a very, very big modernization program. So it is -- I think we will be selling at today's strong prices, at least half a dozen ships from now to the end of the year.

And final question from me, which is more on the modeling side. So Harrys, this one may be for you. Could you confirm that the increase in net income attributable to noncontrolling interest is attributable to that, and this where you hold a 51% stake.

Sorry, can you repeat because you were cutting off.

Yes, I was asking about the increase in net income attributable to noncontrolling interest and whether that's attributable to the [indiscernible].

Correct. Yes.

We have no further questions at this time. Mr. Tsakos, I'd like to turn the floor back over to you for closing comments.

Well, again, thank you very much for attending our first quarter results. If anybody is in Greece for the [ Posidonia, ] we are having an annual meeting during that time, and we would love to host you so you could see the operation also. They have been very challenging times. We have to be continuously alert and take action. And this is what we do. We want to thank our men and women on the ships, and those that are going through difficult times, we're here to support them. And we're looking forward to announce knocking on wood, even better results and in a peaceful environment for the second quarter. And with that, thank you very much. Enjoy the dividend, and we will also, too. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.

Thank you for standing by, ladies and gentlemen, and welcome to Tsakos Energy Navigation Conference Call on the Fourth Quarter 2025 financial results. We have with us Mr. Takis Arapoglou, Chairman of the Board; Mr. Nikolas Tsakos, Founder and CEO; Mr. George Saroglou, President and Chief Operating Officer; and Mr. Harrys Kosmatos, Co-CFO of the company. [Operator Instructions]. I must advise that this conference is being recorded today.

And now I'll pass the floor to Mr. Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation Limited. Please go ahead, sir.

Thank you very much, and good morning to all of our participants. I am Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation. This morning, the company publicly released its financial results for the 12 months and fourth quarter ended December 31, 2025. In case you do not have a copy of today's earnings release, please call us at (212) 661-7566 or e-mail at [email protected], and we will have a copy for you e-mailed right away. .

Now please note that parallel to today's conference call, there is also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please, we urge you to access the presentation slides on the company's website. Now please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user controlled, and that means that by clicking on the proper button, you can move to the next or to the previous slide on your own.

Now at this time, I would like to read the safe harbor statement. This conference call and slide presentation of the webcast contains certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, which may affect TEN's business prospects and results of operations. And at this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation. Mr. Arapoglou, please go ahead, sir.

Thank you, Nicolas. Good morning, good afternoon to everyone. Thanks for joining our call today. I have really nothing to add on the brilliant financial performance and the usual quality operating performance for TEN. Just 4 points from me worth noting. All of our 19 new buildings under construction, including the 2 recent VLCCs and the LNG are already in the money.

The second point is that we sold the 10-year-old VLCC generating $82 million of free cash to be added to the $300 million already existing cash cushion that we traditionally keep.

The third point is that the locked-in contracted future revenue has now gone over the $4 billion mark, excluding profit shares.

And lastly, which is very important, 22 of our vessels are taking full advantage of the high rates in the spot markets through profit share as we speak. So all the above, I believe, guarantee a continued strong performance going forward. And with this, I give the floor to Nikolas Tsakos.

Thank you, Chairman. Good morning, good afternoon to everybody here from Athens -- from peaceful Athens, Greece. We just reported a very strong year, a year that has been a milestone period for TEN, a year in which we concluded significant strategic transactions for the future growth of the company and in very specific segments as the shuttle tanker and the dual fleet segment.

The last quarter of 2025 has been a very strong quarter, and that was before the geopolitical events that started early in January, with the changes and the opening up of Venezuela, one of the largest traditional exporters of sweet crude to the west that has been lagging behind due to political reasons. The opening of Venezuela to the mainstream fleet like ours, we were the first vessel under a several charter to transport the first, let's call it, legal export to the United States after the change of the political environment there.

And soon after that, of course, we have the issues in the Red Sea and the Gulf of Aden that have made it even further -- have even further strengthened spot rates to levels that at least our generation has never seen before. And I think these are the highest levels ever recorded in recent times. In this environment, TEN has been able to conclude very successfully 2025 and is taking advantage of the very strong rates that we are facing since the beginning of the year.

In the meantime, we were able to disinvest some of our older tankers, putting aside in excess of $100 million to our cash reserves and reducing significantly our debt. And we were, I would say, lucky enough with a very good timely orders of our VLCCs at what today look -- our 3 VLCCs at what look today to be at very, very significant discount to today's market and also recently to our LNG orders.

We maintain our moat of modernizing our fleet according to our clients' requests. We are looking to -- we have already a significant dividend policy. Our last dividend was in the later part of February and we're looking forward as we're following day-to-day, and I think we have -- we are following the developments, the geopolitical developments in the Middle East in order to, first of all, to secure the safety of our seafarers, the crew and the cargoes on board and take advantage of this very strong market environment.

So all in all, I would say, as far as the market is concerned, good news. Good news, perhaps not for the right reasons because none of us -- I think nobody in the world is happy to have good news under war circumstances, but we have to run a tight and safe ship and this is what we have been doing. And with that, I will ask George, if you -- Mr. Saroglou, our President, to give us a more detailed analysis of what happened in 2025 and we'll be happy to answer your questions later.

Thank you, Nikolas. We are pleased to report today on another profitable quarter and year. Before reflecting on the company's performance of last year, a few words for the current events unfolding in the Middle East and the Arabian Gulf. Shipping faces another geopolitical event in the Arabian Gulf and the Strait of Hormuz. The Strait of Hormuz sits on one of the world's busiest shipping routes, acting as a gateway to the oil and gas fields, refineries and terminals of the Arabian Gulf. 1/5 of the world's oil and liquefied natural gas passes through this narrow strait. It's a vital shipping lane for dry bulk commodities as well. Spot rates across all tanker vessel classes have spiked at levels far above the already strong rates in existence prior to the start of operation, Epic Fury.

Substitute barrels from the U.S.A., Venezuela, Brazil, Guyana and West Africa are expected to benefit tanker rates and ton-mile demand. When the conflict started last Saturday, we had 3 vessels under time charter approaching the Arabian Gulf. We monitor 24/7 and follow the advice and updates of maritime security centers, flag, state, P&I and insurance underwriters.

In coordination with our charterers, we assess the risk associated with any potential assets through this high-risk area. None of our vessels have entered for now this area, and they are kept outside the Strait of Hormuz. Charterers consider diverting some or all of them to other loading areas outside of the Arabian Gulf.

Our foremost concern remains the safety and well-being of our seafarers on board these vessels and all those vessels that are in proximity and the structural integrity of our assets. Even without the latest geopolitical events, tanker markets have remained healthy during the course of last year. Energy majors continue to approach our company for time charter business.

Since the start of the fourth quarter of 2025, we concluded 20 new time charter fixtures and extensions of existing time charters. Today, we have a backlog of approximately over $4 billion as minimum fleet contracted revenue. We have 33 years history as a public company. We have started with 4 vessels in 1993, and we have turned every crisis the world and shipping have faced through the years into a growth opportunity.

If we move to Slide #4, we see that today, we have managed to have TEN as one of the largest energy transported in the world with a very young, diversified, versatile pro forma fleet of 83 vessels. In Slide 4, we list the pro forma fleet of all conventional tankers, both crude and product carriers. The red color shows the vessels that trade in the spot market, and we have 9 as we speak, 2 more from our last call and our new buildings under construction.

With light blue, we have the vessels that are on time charter with profit sharing, 13 vessels, and with dark blue, the vessels that are on fixed rate time charters, 42 vessels. In the next slide, we leased the pro forma diversified fleet, which consists of our 3 LNG vessels, including the new order we announced today and our 16 vessel shuttle tanker fleet. We are one of the largest shuttle tanker operators in the world with a very young and technologically advanced fleet after the tender we won last year in Brazil to build 9 shuttle tankers in South Korea.

We have 6 shuttle tankers in full operations after taking delivery of both Athens 04 and Paris 24 last year, which commenced long time charters to an energy major. If we combine the 2 slides and account only for the current operating fleet of 64 vessels, 22 vessels or 34% of the operating fleet has market exposure spot and time charter with profit sharing, while 55 vessels or 86% of the fleet is in secured revenue contracts, time charters and time charters with profit sharing.

The next slide lists our clients with whom we do repeat business through the years, thanks to our industrial model. ExxonMobil is the largest revenue client. Equinor, Shell, Chevron, TotalEnergies and BP follow. We believe that over the years, we have become the carrier of choice to energy majors, thanks to the fleet that we have built, the operational and safety record, the disciplined financial approach, the strong balance sheet and good financial performance.

The left side of Slide 7 presents the all-in breakeven costs for the various vessel types we operate in the company. Our operating model is simple. We try to have our time charter vessels generate revenue to cover the company's cash expenses that is paying for vessel operating and finance expenses for overheads, chartering costs and commissions and we let the revenue from the spot and profit-sharing trading vessels to make contributions to the profitability of the company.

Thanks to the profit-sharing elements, for every $1,000 per day increase in spot rates, we have a positive $0.11 impact on the annual earnings per share based on the number of TEN vessels that currently have exposure to spot rates, 22 vessels. We have a solid balance sheet with strong cash reserves. The fair market value of the operating fleet exceeds today $4 billion against $1.9 billion debt and net debt to cap of around 47%.

Fleet renewal and investing in eco-friendly greener vessel has been key to our operating model. Since January 1, 2023, we have further upgraded the quality of the fleet by divesting from our first-generation conventional tankers, replacing them with more energy-efficient new buildings and modern secondhand tankers, including dual fuel vessels.

In summary, we sold 18 vessels with an average age of 17 years and capacity of 1.7 million deadweight ton and replaced them with 34 contracted and modern acquired vessels with an average age of 0.5 years and 4.7 million deadweight capacity. We continue to transition our fleet to greener and dual fuel vessels. We are currently one of the largest owners of dual-fuel, LNG-powered Aframax tankers with 6 vessels in the water.

Global oil demand continues to grow year after year. OPEC+ accelerated their voluntary production cuts, wars, economic sanctions, sanctions lifted tankers and geopolitical events positively affect the tanker market and freight rates while the tanker order book remains at healthy levels as a big part of the global tanker fleet is over 20 years and will need to be replaced gradually. And with that, I will pass the floor to Harrys Kosmatos, who will walk us through the financial performance for the fourth quarter and last year.

Thank you, George. Harrys?

Thank you, George. So let's start with a review of the year 2025. So with 2025 starting on the whim with an avalanche of global tariffs and tit-for-tat actions by China on U.S. proposed port fees, measures that were subsequently revised or suspended, all in the backdrop of ever-growing geopolitical turmoil, the tanker markets remained elevated and oil majors increased their long-term cargo requirements. To this effect, TEN through to its tried and tested operating model of seeking long-term cover provided the vessels required for its blue-chip clientele to meet its needs.

This operational tweak, however, did not hinder the fleet from taking advantage of the equally strong but more erratic spot market as it had a good complement of vessels benefiting from trading spot. In particular, with the fleet in the water averaging 62 vessels identical to 2024, days under secure revenue employment, that is vessels on time charters and time charters with profit sharing provisions increased by 12.6%, while days on spot declined by 33%.

Of interest, during 2025, days on profit sharing contracts alone increased by 12.4% from 2024, highlighting TEN's commitment to adding another layer of employment to benefit from the very lucrative spot market. Today, 1/3 of our fleet, that is 22 vessels, 9 on pure spot and 13 on profit sharing contracts are directly impacted by the historical strong spot market.

As a result of this employment shift, during 2025, TEN generated close to $800 million in gross revenues and $252 million in operating income, which incorporated $12.5 million of capital gains from the sale of 4 older vessels. Capital gains during the equivalent 2024 12 months were up $49 million from the sale of 5 vessels.

In line with the above employment pattern and fewer vessels on dry dock compared to 2024, 10 in '25 from 15 last year in '24, fleet utilization increased to 96.6% from 92.5% in 2024. The time charter equivalent rate the fleet attained during 2025 was a healthy $32,130, similar to 2024 levels. Reflecting the reduction of the fleet's spot exposure mentioned above, voyage expenses declined from $153 million in 2024 to $122 million in 2025, a saving of $30 million. A saving of $4.4 million was also incurred by a reduction in charter hire expenses whilst vessel operating expenses increased by just under $13 million from the year prior to settle at $211 million.

The introduction of larger and more specialized vessels in the fleet like Suezmax and shuttle tankers in place of Handysize and Aframax vessels that were sold contributed to that increase. As a result, operating expenses ship seat per day for 2025 average a competitive $9,990, about 1/3 of the time charter equivalent rate mentioned above. Depreciation and amortization came in at $170 million for 2025 from $160 million reflecting the introduction of 4 newbuilding vessels. General and administrative expenses in 2025 were at $42 million from $45 million in 2024, to a large extent, the result of the amortization of stock compensation awarded in July 2024 and scheduled to fully vest by July 2026.

A decline was also experienced in our cost of interest as a result of lower interest rates, which despite $174 million increase in the company's debt obligations from 2024 due to new loans for TEN's newbuilding program came in at $98 million compared to $112 million in 2024, another saving of $14 million. Interest income came in at $10.5 million which was another meaningful contribution.

At the end of 2025 with just 62 vessels on average in the water and 20 vessels -- and a 20-vessel newbuilding program, TEN's total debt obligations were at $1.9 billion with net debt to cap -- while net debt-to-cap stood at a comfortable 46.7%. TEN's loan-to-value at the end of 2025 was a conservative 48%. As a result of all the above, the company during 2025 generated a healthy net income of $161 million or $4.45 in earnings per share. Adjusted EBITDA for the year came in at $416 million, while cash at hand as at the end of December 2025 stood at $298 million. After having paid $148 million in scheduled principal payments, $190 million in yard predelivery installments and capitalized costs and $27 million in preferred share coupons.

And now let's go over the quarter 4 summary results. The fourth quarter of 2025 experienced similar fleet employment patterns, which had fleet utilization reaching 97.7% from 93.3% during the 2024 fourth quarter. During the 2025 fourth quarter, 2 vessels underwent scheduled dry dockings compared to 4 in the 2024 fourth quarter, which naturally contributed to this improvement. With an identical number of vessels in the water with the 2024 fourth quarter, albeit of greater deadweight, the fleet generated $222 million of gross revenues and $81 million in operating income which similarly to the 2024 fourth quarter did not have any gains or losses from vessel sales.

The result in time charter equivalent per ship per day, reflecting the ever-increasing strength in rates was at $36,300, 21% higher than the 2024 fourth quarter level. Voyage expenses during this year's fourth quarter were lower compared to last year's fourth quarter, experiencing a $7.6 million drop to settle at $26.8 million. Operating expenses, on the other hand, increased to $56 million from $51 million in the fourth quarter of '24 due to some extent by operating larger vessels. The result in operating expenses per ship per day for the fourth quarter of 2025 came in at $10,558. Again, 1/3 of the fleet average TCE and still competitive, thanks to the efficient and proactive management performed by TEN's technical managers.

Depreciation and amortization were a little higher from the 2024 fourth quarter at $44.4 million. General and administrative expenses were at $6.2 million lower from last year's third quarter at $9.2 million. Interest came in at -- interest costs came in at $25 million, similar to the 2024 fourth quarter, while interest income contributed about $3 million to the bottom line.

As a result of all the above, TEN during the fourth quarter of 2025 reported $58 million of net income or $1.70 in earnings per share, a 200% increase from the 2024 fourth quarter. The adjusted EBITDA during the fourth quarter of 2025 settled at $128 million, $42 million here from the 2024 fourth quarter number. And with that, I'll pass it back to Nikolas. Thank you.

Thank you, Harrys, for having so many positive numbers. I will allow you to make long presentations as long as the numbers are positive because -- well, as we said, the fourth quarter was only the beginning of the end, I would say, of a very fruitful year for 2025, a year that we have been able to establish a renewal -- a significant renewal of the fleet.

We have been able to take and absorb the new acquisitions of the Viken fleet, which we did earlier fully in the company. And we were able to have an increase of our utilization to close to 98%, which I think this is really something that we want to congratulate also the operation department of Tsakos Shipping and Trading for keeping the ships -- the propellers earning almost 100% of the day. And this figure includes dry dockings and special surveys. So it's really, I think, the highest utilization in the company's history. And the beginning of '26, we had, I would say, surprises mainly on the geopolitical front.

We have the change and the lifting of sanctions from Venezuela, which has allowed companies like ourselves to be able to participate even more in that -- in those trades. And of course, recently, the events in the Persian Gulf which have created spot rates or have led to spot rates and prices of oil that we have not seen for a generation. The company is very well prepared to navigate such a tremulous environment. And as Mr. Saroglou showed us in our earlier slide, I think the company comes stronger out of every crisis.

I think most of you listening are too young to remember most of the crisis that we have been -- that we have gone through in the last -- 7 crisis in the last 30-odd years, but the company has been able to build and build further. And I think this graph is very evident that the Harrys, next time don't forget you have 12.5% growth that we usually have to show that the company has been growing year after year regardless of difficult markets.

Another important factor we have increased the dividend. We paid the last part of our dividend in February and we're looking to reward shareholders accordingly as we move forward. A lot of question marks. We're actually focusing on the safety of our seafarers, as Mr. Saroglou said and also protecting our assets and the cargoes in our assets. We are going through situations that we have not seen in a generation. But we are well prepared to be able to take advantage of that.

And with that, I would like to open the floor and also to thank the Chairman for his good words earlier to any questions. Thank you.

[Operator Instructions] Our first question comes from the line of Climent Molins with Value Investor's Edge.

I wanted to start by asking about the 2 LNG carrier orders you announced today. Could you talk a bit about whether you're already in discussions for long-term charter employment. And if so, what duration are you targeting?

Yes. I mean, there is -- as I said, the LNG segment is a segment that we have been participating from a very early stage back in 2007. However, I think for good reasons, we have never overextended ourselves in investing in that segment. We always want to participate in new ships and new technologies, and that's what we have done. And with these ships, it's too early to charter long term, but there is a lot of appetite going forward. So I think this is more as a long-term investment for this growing segment of the business rather than something that we have done with a charter in mind.

All right. Makes sense. I also wanted to ask about the [indiscernible]. Could you talk about how the index-linked portion is calculated? Is it benefiting from the surge in spot rates we've seen in recent days?

The [indiscernible] on a profit sharing arrangement based on trading routes of the Far East, end of Transatlantic. So of course, it's participating in this situation and the current employment ends in about 8 months. And of course, there is a significant appetite for such a [ prong ] ship going forward.

That's helpful. As I understand it, you very recently fixed 2 MR2 new builds that were delivered earlier this year. Are they employed at fixed rates or at variable hire? And if it's the former, at what rate are they employed?

We cannot tell you all the secrets. You have to call Mr. Kosmatos. When you see him in New York, you can ask Mr. Kosmatos. He's only allowed to write this in a piece of paper and secretly hand it to you under the table. But they are -- I would say, they are fixed rates, and they're very, very accretive in the mid- to high 20s. That's all I can say. And I think these are the highest that those ships have been fixed -- these type of ships have been fixed in the recent months or at least this is what our chartering department tells us.

Makes sense. Harrys, we definitely need to catch up soon.

Looking forward to it, gentleman.

Yes. I also have a question on the shuttle tanker newbuilds. We've seen some of your peers getting very good financing terms and support from the Korean export agency. Is this something we should kind of expect on your shuttle tanker orders as well?

Of course. Of course, I mean, we are one of the biggest supporters of South Korean yards and all the -- we try to keep all -- we are currently to the Herculean task of our newbuilding department. We had site offices in all the major South Korean yards. So we have a very big site office in Samsung as big in Hanwha, the ex Daewoo, and of course, a big one in Hyundai, which we never stopped having versus perhaps if you recall, we just took delivery of our last vessel there in October.

So we keep on maintaining very hands-on site offices in this -- in all of them. And of course, we get the appreciation from the Korean banking system. And I think our team has concluded one of the largest syndications for the finance of those vessels at very, very competitive terms.

That's good to hear. And final question from me. Big picture, 2026 has started very strongly for you and both earnings and free cash flow are set to rise very significantly. Could you talk a bit about how you think about your capital allocation priorities? How do you plan to balance deleveraging fleet renewal and increase shareholder returns going forward?

Well, I think, as we said, our -- we make sure that we are securing the well-being of the company long term. And as we speak, I think as we see today, [indiscernible] accounted, I think that by the end of the first and second quarter, we might be in excess of $0.5 billion in liquidity, which means that our priority is the reward of our shareholders, which we are the largest ones as the management. And then, of course, we would be allocating our newbuilding program is almost fully financed, as I said, with the recent syndication. So rewarding our shareholders, reducing debt significantly. And we might be looking at next year, April next year to actually repurchasing some of our very, very usual preferreds.

Our next question comes from the line of Poe Fratt with Alliance Global Partners.

Yes. I was trying to isolate the impact of the profit sharing agreements that you had in the spot market exposure on the increase in voyage revenue in the fourth quarter versus the third quarter. Can you quantify the impact of the increase in the TCE rate. What was the exposure to the spot market versus the contribution from profit sharing?

Well, we did see a lot of profit sharing coming in later -- well, throughout '25, and we are beginning to see recently. And actually, a number of our vessels have been rechartered on higher elevated floor rates to what they were previously. Just to give you an idea, over and above the fixed rate that I mentioned earlier in the fourth quarter of '25, we got an additional $27 million from the profit sharing income that came in. So obviously, we did have some benefit.

It seems that the numbers will -- I mean they look that we are moving in the right direction and perhaps to recall the similar amounts of additional income going forward. So again, $27 million over and above the flow rate on those profit sharing vessels in the fourth quarter.

Yes. That's a significant amount. I mean, this is almost like 50% of the profitability of the fourth quarter. So it's not -- it's -- the profit arrangements have huge contribution being $27 million on $58 million of profit.

Yes, that's exactly what I was looking for. And so there were some -- there was a positive increase on some of rechartering or recontracting the time charters that you had. And when you look at the first quarter and looking maybe at the first half of the year, my sense is that rates started to move in the fourth quarter, but the really significant move is more in the February time frame. And obviously, it's a little early just because of what's going on in the Middle East. But is there an additional step-up that we should see in the first quarter in profit sharing?

Yes. I mean, the way things are today, I think the profit sharing has gone off the chart because of -- and as Harrys said, I mean, for example, we had the categories of ships that we would profit share for anything above $20,000 a day. And the next fixture was anything about $35,000 a day. So you understand that we made sure that we pushed the fixed part of the profit sharing as high as possible for as long as possible and then the profit sharing goes. So yes, I think the first quarter, it's going to be another step up from where we left the fourth quarter.

And I think of interest, Poe, is that from the 13 vessels that we currently have on profit sharing, 7 are Suezmaxes and 2 are VLs.

Yes. So they're actually the big boys of profit sharing.

Yes. I was going to say and that's where you're seeing the meaningful increases. Maybe it will still [ flip ] down to the smaller sizes, but at this point in time, your exposure to the larger segments is -- or larger sectors is really good. When you look at the decision to sell the [ B ], what -- how did you -- was this an inquiry from somebody as far as trying to -- there's been a big acquirer out there, was there an inquiry that came in that led you to hit the bid? Or was this part of your strategic fleet renewal? And then if you could talk about what other potential assets are on the block that we could see sold in 2026, that would be helpful.

Yes. I mean there's always -- it takes 2 to tango. So it was not that we were out. I mean, our philosophy has always been that we're looking to sell any vessel which is between 10 and 15 years old. As you very well know, there have been people who have been buying these assets at prices that make a huge sense. I think we were, I would call it, lucky enough in November to order 3 VLs of Hanwha at prices of today. And just to put it in perspective, the newbuilding, so we show -- we ordered those ships. I think it has been reported at $128 million.

And we sold the 10-year-old ship, which if you equate, it's a newbuilding price, it's in excess of $170 million. So it doesn't -- it's always good to take advantage of these possibilities. And the good thing is that we are going to be using the ship up to almost the middle of the year since we're taking advantage right now in a huge way of the big market -- of the spot market. And we're going to be selling here and delivering here back to the new owners sometime in June, end of May, June. So in a sense, we were able to have our [indiscernible] for the first 6 months.

Yes, that was a pretty timely rollover as far as just the [ issues ] went open in the, I guess, December time frame. Just go back to, if you wouldn't mind, the chartering strategy, profit sharings kicked in, you see a step-up in the first quarter, probably the second quarter too. Where do you get more aggressive in trying to lock in the higher rates?

We are always -- I mean, we have set an evident step-up in all categories of the vessels. And as long as we are able to have the profit sharing arrangement, which is something that very few others do, we should keep it that way. You've seen on Slide #7 on Page 7, you see our breakevens, which I think are very, very competitive. I mean, we have an all-in breakeven for VLs up to $28,000. Today, they're averaging above $100,000, including the profit sharing. So there's a little profit to make there.

Suezmax is breakeven of everything at $25,000. I think we're closer to $80,000. Aframax is $21,000 -- well, Aframax and LR2s, if you put them together, about $22,500. Again, we're in the $70,000s and $80,000s there. our Panamaxes, which are our oldest segment in the $18,000 and I think that's where we got the $30,000-plus profit share arrangements. So those are in the money. Our Handysizes are down to $10,000, which means there are actually operating expenses and some interest since they're very, very well amortized. The LNGs -- and our shuttle tankers are also very much into the money at $34,000 time charter. So when we can make sure that we get covering our minimum significantly, then we do the profit share. I think Page #7 portrays, Mr. George, what Mr. -- our President has put up on the board.

Yes, that's helpful. And if I may, one more question. Obviously, the turmoil in the Middle East just had an impact on rates. But the other side of the question is, right now, and I know you don't have any tankers in Hormuz way. But what are you expecting on the insurance expense side? And then also how much exposure do you have to higher fuel costs as we look at the rest of 2026?

This is actually a very good point. I think we have had in the last week a 500% increase on insurance on war risk insurance. I think from what we used to do it at $0.15 per deadweight ton, we're up to close to $1 now or $0.75 to a $1. So that's a huge increase. It's 500%. Of course, all this is paid directly by the charter. So it does not really influence -- it's not -- it's a pass-through cost for us. But it shows how the market rates this risk.

As far as our fuel costs, I mean, we have -- first of all, we have close to 25% of our existing requirements covered, George, for the next couple of years at very competitive rates. But also being mainly on a time charter basis, all the fuel cost surges or not affects our clients. So we do not have that. I mean we have a huge fleet, but being on time charter, the risk of the surge or drop of the bunker costs are taken up by the charters in a very big way.

Great. And I'm sorry, if I may squeeze one last one in. What's your dry docking schedule for the rest of the year?

Okay. We are starting quite live for the first quarter. We only have 2 vessels, 2 Suezmaxes for Q1. We have 5 vessels in the second quarter, 7 vessels in the third quarter and 3 vessels in the fourth quarter.

Hopefully, we will be able to see you in New York next week.

And we have reached the end of the question-and-answer session. Now I'd like to turn the floor back to CEO, Mr. Nikolas Tsakos for closing remarks.

Well, thank you for participating and listening in to our 2025 end of the year results. It has been a productive year. Your support has been appreciated. We have seen significant, I think, close to 60% increase of share price in the last year, which shows the trust that the public markets are putting on TEN. And hopefully, this is only the beginning. We have seen, again, a very steady trading and a very positive trading of our preferreds.

The company would maintain its distribution policy of keeping shareholders -- of rewarding shareholders. We are going through a period of uncertainty in the world. And what we try to do with them is to take as much of this uncertainty possibly out through our chartering policy, which is always to the most blue-chip end users out there. And with that, we want again to thank you. Wish you a good weekend. And hopefully, we'll see you in New York next week. Thank you.

Thank you. And this concludes today's conference, and you may disconnect your lines at this time. We thank you for your participation. Have a great day.

Thank you for standing by, ladies and gentlemen, and welcome to Tsakos Energy Navigation Conference Call on the Third Quarter 2025 Financial Results.

We have with us Mr. Takis Arapoglou, Chairman of the Board; Dr. Nikolas Tsakos, Founder and CEO; Mr. George Saroglou, President and Chief Operating Officer; and Mr. Harrys Kosmatos, Co-CFO of the company.

[Operator Instructions]

I must advise that this conference is being recorded today.

And now I pass the floor to Mr. Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation Limited. Please go ahead, sir.

Thank you very much, and good morning to all of our participants. As you mentioned, I'm Nicolas Bornozis, President of Capital Link and Investor Relations Adviser to Tsakos Energy Navigation.

This morning, the company publicly released its financial results for the 9 months and third quarter ended September 30, 2025. In case you do not have a copy of today's earnings release, please call us at (212) 661-7566 or e-mail us at [email protected], and we will have a copy for you e-mailed right away.

Please note that prior to today's conference call, there is also a live audio and slide webcast which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please, we urge you to access the presentation slides on the company's website. Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user controlled, and that means that by clicking on the proper button, you can move to the next or to the previous slides on your own.

At this time, I would like to read the safe harbor statement. This conference call and slide presentation of the webcast contains certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, which may affect TEN's business prospects and results of operations.

And before turning the call over to Mr. Arapoglou, let me take the opportunity to congratulate Dr. Tsakos for your recent recognition in New York by the Philoptochos Society of the Greek Orthodox Cathedral, paying tribute to your personnel and the group's contribution to the Global Maritime Industry to Philanthropy, Education and Community Welfare. Congratulations.

And at this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation. Please go ahead, sir.

Thank you, Nicolas. Good morning, and good afternoon to all. Thank you for joining us today for the announcement of the 9 months and third quarter results of 2025. No surprises. Our business model continues producing sustainable profits, beating estimates, as you saw, while at the same time, building up a solid stream of $4 billion of accretive future contracted revenue. This provides stability and more predictability in our results going forward, as we explained many times in the past and mitigate volatility in our stock price while maintaining a very solid cash position of nearly $300 million.

These results are a product of high fleet utilization, best-in-class operating efficiency by now a trademark for TEN. We're reminding the market of our record 20 Vessel Newbuilding Program with deliveries starting Q1 2026 until Q4 2028, 10 of which the shuttle tankers with long-term accretive employment. The program includes, of course, 3 VLCCs, materially growing our presence in the sector -- in this sector of the market. At the same time, and as mentioned earlier, in earlier communications, we are focusing on selling our older tonnage in order to continue maintaining a young and very modern fleet.

Lastly, as mentioned in our press release, after the $0.60 per share interim dividend in July, we declared payment of an additional $1 per share dividend. This will be paid in 2 equal tranches of $0.50 each, one in December 19, 2025, and one in February 19, 2026, in order to, going forward, gradually align dividend date to the timing of audited results as Nikos Tsakos will explain later.

At today's stock price, the total dividend of $1.60 per share for the year represents a very attractive yield of over 4%. So congratulations once again to Nikos Tsakos and his team. Their proven track record and business model in a market with stronger tanker fundamentals and turbulent geopolitics. This ensures continued success.

Thank you very much, and over to you, Nikos.

Chairman, thank you, and welcome, everybody, to our 32nd year 9 month call. First of all, I would like to congratulate Clio Hatzimichalis for becoming a full -- she is our lawyer keep us out of trouble for all this year. So we're very happy for her to join the main Board of the company and looking to spend much more time, productive time. Well, in September, when we reported our 6-month results, I think we were all satisfied. They were good results. We did not expect the market to take -- to become even better, even stronger. And that's where we are today.

I think we're perhaps more than 50% higher on the spot market than we were back in September, which we were very satisfied having gone through the typical seasonal period and being with a lot of profitability. We had a couple of months of lull waiting for the developments of the IMO saga, I would say. I think rightly so, the postponement has been achieved, and that allows the shipowners and the related parties to this industry to be able to put more input and find solutions going for the -- going forward. So I think we welcome this development. Since that development has put the world in -- at peace, the end of too much tariffing each other has also been achieved and the market has gone from strength to strength.

We are seeing a market which has limited supply of tonnage. And all our vessels right now are in very high demand. I was glad that we, of course, were way ahead of -- or beat the estimates, and we're looking forward because I think the quarter we're going through now is also going to be a very strong quarter. We just concluded our fourth long-term profit sharing almost arrangement today on our VLCCs with a very accretive minimum rates, minimum rates that we would be happy to have as fixed rates many years before, and that would be a minimum rate and then with unlimited upside for the company.

And with this part of good news, I will ask George Saroglou, our President, to give us a quick update of what has happened in the last 9 months.

Thank you, Nikos. We are pleased to report today on another profitable quarter. Tanker markets have remained healthy during the course of the year. And as Nikos mentioned, energy majors continue to approach our company for time charter business. Since the start of the year, we have 40 new time charter fixtures and extension of time charters. And today, we have a backlog of approximately $4 billion as minimum fleet contracted revenue. We have a 32-year history as a public company.

From 4 vessels in 1993, we have turned every crisis the world and shipping has faced through the years into a growth opportunity. And we have faced many crisis since the start of the new decades, a lot of which we did not actually expect. We faced a global COVID crisis in 2020 with lockdowns and unprecedented collapse in global oil demand. Then as the world was exiting COVID and we were trying to go back to normal, we've had the war in Ukraine in 2022 and a major -- which resulted in major disruption in energy trading.

Then in late 2023, we had the attack of Hamas in Israel and the ensuing war and the continuous attacks of merchant vessels in the Red Sea until most of the shipping people decided not to cross the Red Sea anymore. The turmoil in the whole of Middle East, the unwinding of globalization, the introduction of tariffs in 2025, trade wars between the United States and China and the rest of the world and the decarbonization efforts of many global industries, including shipping, which, as you know, has the lowest carbon footprint when we compare while at the same time, it's the most efficient way to transport different land-scale cargoes around the world. So a lot to do in such a short time.

So far, we have managed to navigate the TEN ship safely through these challenges, thanks to the company's crisis-resistant model. Let's hope we go back to more peaceful and normal times for all very soon. Today, TEN is one of the largest energy transporters in the world with a young, diversified, versatile fleet of 82 vessels, a pro forma fleet of 82 vessels.

So in Slide 4, we list this pro forma fleet, and we start with the conventional tankers, both crude and product tankers. The red color shows the vessels that trade in the spot market, and we have 7 as we speak, and our new buildings under construction. With light blue, we have the vessels that are on time charter with profit sharing, 16 vessels and with dark blue, the vessels that are on fixed rate time charters, 39 vessels.

In the next slide, we list the pro forma diversified fleet, which consists of our 2 LNG vessels and our 16 vessel shuttle tanker fleet. We are one of the largest shuttle tanker operators in the world with very young and technologically advanced vessels following the tender we won earlier in the year in Brazil, building the Samsung shipyard in South Korea, 9 shuttle tankers for Transpetro. We have 6 shuttle tankers in full operation after recently taking delivery of both Athens 04 and Paris 24, which commenced long time charters to an energy major. If we combine the 2 slides and account only for the current operating fleet of 62 vessels, 23 vessels or 37% of the operating fleet has market exposure, spot and time charter with profit sharing, while 55 vessels or 89% of the fleet is in secured revenue contracts, that is time charters and time charters with profit sharing.

Our clients with whom we do repeat business through the years are the blue chip list of our world. ExxonMobil is the largest revenue client, followed by Equinor, Shell, Chevron, Total and BP. We believe that over the years, we have become the carrier of choice to energy majors, thanks to the fleet that we built, the operational and safety record, the disciplined financial approach and the strong balance sheet and financial performance.

The left side of Slide 7 presents the all-in breakeven cost for the various vessel types we operate in TEN. Our operating model is simple. We try to have our time charter vessels generate revenue to cover the company's cash expenses, paying for the vessel operating and finance expenses, for overheads, chartering costs and commissions and let the revenue from the spot and profit-sharing trading vessels contribute to the profitability of the company. And thanks to the profit-sharing element for every $1,000 per day increase in spot rates, we have a positive $0.09 impact on the annual EPS based on the number of TEN vessels that we currently operate in -- have exposure to spot rates, and that is 23 vessels.

We have a solid balance sheet with strong cash reserves. The fair market value of the operating fleet is approximately $4 billion against $1.9 billion debt, and the net debt to cap is around 47%. Fleet renewal and investing in eco-friendly greener tankers has been key to our operating model. Since January 1, 2023, we have further upgraded the quality of the fleet by divesting from our first-generation conventional tanker, replacing them with more energy-efficient newbuildings and modern secondhand tankers, including dual fuel vessels.

In summary, we have sold 17 vessels with an average age of 17.3 years and capacity of 1.4 million deadweight tons and replaced them with 33 contracted and modern acquired tankers with an average age of 0.6 years and 3.4x the deadweight capacity of the vessels we sold. We continue to transition our fleet to greener and dual fuel vessels. We are currently one of the largest owners of dual fuel LNG-powered Aframax tankers with 6 vessels in the water. Global oil demand continues to grow year after every year. OPEC+ accelerated their voluntary production cuts, wars, economic sanctions, sanctions listed tankers and geopolitical events positively affect the tanker market and tanker freight rates.

While the tanker order book remains at very healthy levels as a big part of the global tanker fleet is over 20 years. As we speak, almost 50% of the fleet is over 15 years and needs to be replaced soon.

And with that, I will pass the floor to Harrys Kosmatos, who will walk us through the financial performance for the third quarter. Harrys?

Thank you. Thank you, George, and welcome, everyone, to our call. So I'll start with the 9-month highlights. So as the tanker markets continued their upward trajectory propelled by the crude sector and VLCCs in particular, available term rates for crude vessels merited a shift towards fixed employment in order to provide earnings visibility and further safeguard the cash generating ability of the fleet. To this effect and in line with the company's tried and tested employment model, bar some occasional aberrations for opportunistically capturing short-term fix reverted to the norm and operated most of the fleet during the first 9 months of the year in secured revenue contracts.

In particular, with a fleet of almost 62 vessels in the water, similar to the corresponding 2024 9-month period, days under secured employment, that is vessels on fixed time charters and time charters for 47 provisions increased by 12%, while days on pure spot experienced a 32% decline. Of interest, days on profit sharing contracts alone increased by 18%, signifying TEN's commitment to maintaining a meaningful presence in the still lucrative spot market. Today, 23 vessels in the fleet, 7 on spot and 16 on profit shares do provide TEN with such operational latitude.

As a result of this employment recalibration for the 9 months of 2025, TEN generated $577 million in gross revenues and operating income of $171 million, which incorporated $4.5 million of capital gains from the sale of 4 older vessels. Capital gains during the equivalent 2024 period were at $49 million from the sale of 5 vessels, highlighting TEN's policy to continue the strategic recycling of the fleet with newer, more eco-friendly vessels, new builders in the majority. In line with the above employment pattern and fewer vessels on dry dock compared to the 2024 9 months, 9 now from 11 last year, fleet utilization increased from 92.2% to 96.2% during the 2025 9 months.

The fleet's Time Charter Equivalent rate for the first 9 months of 2025 settled at a healthy $30,703. During the 9-month period and in line with the reduction of the fleet's spot exposure explained above, Voyage expenses declined from $118 million in the 2024 9 months to $95 million now, a $23 million betterment. Charter hire expenses also decreased by $4.6 million, whilst vessel operating expenses increased by just over $7 million from the 2024 same period to settle at $155 million. As a result, operating expenses per ship per day for the 2025 9 months averaged still competitive $9,797, just 1/3 of the Time Charter Equivalent rate mentioned above. Depreciation and amortization came in at $126 million for the 9 months of 2025 from $118 million in the 2024 9 months, reflecting the introduction of 3 newbuilding vessels and the new depreciation calculation on the 2 vessels repurchased from lease structures.

General and administrative expenses were at $32 million, reflecting the amortization of stock compensation awarded in July 2024, and scheduled to fully vest by July 2026. On the other hand, significant improvements were made in our interest costs as a result of declining global interest rates and despite $126 million increase in the company's debt obligations from the 2024 9 months due to new loans for TEN's Newbuilding Program. $72.7 million of interest costs now compared to $87.4 million in the 2024 9 months, a near $50 million saving.

At the end of the 2025 9-month period with 61.2 vessels on average in the quarter and the 20 Vessel Newbuilding Program, our total debt obligations were at $1.9 billion, while net debt to cap stood at a comfortable 47.3%. TEN's loan-to-value for the 2025 9-month period was at a conservative 50%. Interest income came in at $7.7 million, a meaningful contribution. As a result of the above, the company during the first 9 months of 2025 generated a healthy net income of $103 million, which translates to $2.75 in earnings per share. Adjusted EBITDA for the 2025 9 months was at about $290 million, while cash at hand as of the end of September 2025, stood at a healthy $264 million after having paid $135 million in scheduled principal payments, $178 million in yard predelivery installments and capitalized costs and $20.3 million in preferred share coupons.

And now let's move to the quarter 3 highlights. The third quarter of 2025 experienced similar movement in fleet employment patterns, which led to fleet utilization increasing from 92.8% in last year's third quarter to 94.8% during this year's third quarter, despite 4 vessels undergoing scheduled dry dockings during the period compared to 3 vessels in the 2024 third quarter. With vessels in the water slightly under the level of the 2024 third quarter, the fleet generated $186 million of gross revenues and $60.5 million in operating income, which included $8.9 million, call it $9 million of capital gains from the sale of 3 older vessels and not the similar performance from last year's third quarter, which did not incorporate any gains or losses from vessel sales.

The resulting Time Charter Equivalent per ship per day was at $30,601, in line with the focus of diminishing our presence in the spot markets. Naturally, voyage expenses during the year's third quarter were lower compared to last year's third quarter, experiencing a $7.7 million decline to settle at $27.4 million. Operating expenses, on the other hand, increased in line with the introduction of 3 larger vessels and settled at $52 million. The resulting operating expenses per ship per day for the third quarter of 2025 came in at $9,904, again, ahead of the fleet average TCE and still competitive, thanks to the efficient and proactive management performed by TEN's technical managers.

Depreciation and amortization were a touch higher from the 2024 third quarter levels at $42.4 million, again, reflecting the new vessel introductions and the 2 suezmax repurchased from sale and leaseback agreements. General and administrative expenses were $5 million lower from last year's third quarter at $9.2 million. Interest costs, again, following the downward trend in interest rates came in at $23.7 million from $32.2 million during last year's third quarter. In other words, savings of $8.5 million. On top of that, another $2.1 million in cash gains was realized through the interest income generated during the 2025 third quarter.

As a result of all the above, TEN during the third quarter of 2025 reported $38.3 million of net income or $1.05 in earnings per share. The adjusted EBITDA during the third quarter of 2025 settled at about $96 million, reflecting the shift towards longer-term secured revenue contracts to meet our clients' increasing long-term demand.

And with this, I pass it back to Nikos. Thank you.

Good. Thank you, Harrys. Since the figures are good, we didn't talk about them a lot. But as I said, I think we had good results in the first 6 months. The market had a long period, really expecting the developments of the net zero discussions at the IMO. And after the extension of the discussions, the market has taken off again, and we are looking at the business coming very strong in the spot market and a lot of employment. As we said today on our VLCCs has been extended for another 2 years and there's a huge appetite for business out there.

There's an increasing presence of the gray fleet, a lot of breakdowns on those ships. And of course, we are going through, again, more than expected geopolitical challenges with hijacking of vessels like the recent one from Iran and the Somalia piracy on both on Greek vessels outside -- quite outside 500 miles away from the Somalia growth. So there's a lot of interference. And in the meantime, this has created a nervousness in the market going forward, which we are able to take advantage with our chartering strategy I described with 40 new ships totaling $4 billion of extended business over the next 5 years.

And with that, we would like to open the floor to any questions.

[Operator Instructions]

Our first question comes from the line of Climent Molins with Value Investor's Edge.

I wanted to start by asking about the 12 VLCCs coming open throughout this month. You mentioned in the press release that the employment on the DS1 has been extended for 2 years. Could you clarify at what terms?

And secondly, based on your data kit, the Ulysses should also come open this month. How do you plan to employ this vessel? Is there any appetite to trade on spot?

Yes. Thank you for your questions. We are trying right now to protect our ships from being actually hijacked by the major oil companies. So it's -- but joking apart, I think we are seeing a significant increase, a 20% increase from our profit-sharing arrangements of the past from our minimum profit sharing arrangements. So there is a significant appetite for the vessels out there. I cannot -- perhaps if you -- next week when you see Harrys in the states, he can give you more details on that. But of course, it's quite a positive situation.

Makes sense. I'll reach out. I also wanted to ask about the Maria Energy. It is fixed until February of next year, but the long-term contract you signed a while ago doesn't start until May, if I remember correctly. Do you plan to trade the vessel on spot once it comes off its current contract and before it starts the next one?

The vessel is actually fixed back to back to a 15-year employment. So there won't be any downtime between that other than the survey that she will have the scheduled survey, which will have to go before the delivery of this in April. So the vessel has been chartered back to back until she goes to her new charter. So there won't be any downtime.

Perfect. And final question for me. You have a couple of MR newbuilds delivering in early '26. Should we expect those to be fixed on long-term contracts before delivery? And should that be the case, what kind of duration are you looking at?

We're contemplating. As I said, there's a big appetite. We're here with our chartering team. They have, I think, 5 or 6 major oil companies looking for those ships. As you know, we're a big participant in the Cargill-Maersk pool. We're very happy with that performance of that pool. And I've been saying that for us, the best method or the only method of consolidation in our industry is through commercial pooling because whoever has a fleet of our size or smaller or around or bigger does not really -- you do not gain any economies of scale of just ordering more and more and more ships and running more ships because the ships are always there.

So we are supporting the pool, and we're -- the pool has performed quite well. And we might be considering also pooling. Pooling gives you the upside of -- gives you full utilization and the upside of a spot market.

Our next question comes from the line of Poe Fratt with Alliance Global Partners.

Some of the questions were covered already, but when I look at your newbuild program, close to 20 major commitment. What are you looking at as far as the fleet renewal side? You've been active selling assets. Asset values are fairly firm in my mind. So what should we anticipate over the next, call it, year or so as far as on the asset sales side?

Our -- I say we are close to negotiating 5 of our first-generation vessels. And so if you put it in a 12 month -- if you put it -- if you take a 12 months forward, I think it would be perhaps double that, 10 vessels. We're looking to the transactions we have in mind would release close to $250 million of net cash, which is more than enough of what we need for our newbuilding program.

Ladies and gentlemen, that concludes our question-and-answer session. I'll turn the floor back to Dr. Tsakos for any final comments.

Thank you. Well, I hope, first of all, thank you for listening in. The market looks getting firmer and firmer. And from what I understand from my kids that are studying on the East Coast, the weather is [indiscernible] yet. So we're looking for further call. We're looking forward to continue with this positive market.

Right now, we're taking advantage as much as possible with the team. And I would like to wish everybody a happy Thanksgiving next week. And don't forget that the TEN's share price is right now on Black Friday prices. So before next Black Friday, you buy some more of that. And I will ask our Chairman to have a final word. Thank you.

Happy Thanksgiving for me, too. I think that we're looking forward to beating all estimates next time around, touch wood. And again, congratulations to Nikos Tsakos team for excellent performance.

Thank you all. Happy Thanksgiving. Thank you.

Thank you. Bye.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.