Tsakos Energy Navigation Ltd. 2026 Q2 Earnings Call

Thank you very much, and good morning to all of our participants. I am Nicolas Bornozis, President of Capital Link and Investor Relations Advisor to Tsakos Energy Navigation. This morning, the company publicly released its financial results for the six 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 email us at ten@capitallink.com and we will have a copy for you emailed 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. 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. At this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation.

Before doing that, I would 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.

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. Once again, congratulations to Nikolas 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, no surprise that it works so well also in this market where current market conditions are very favorable. It is a great opportunity for TEN to continue generating cash from operations, to continue from selling all the vessels to renew the fleet and generate more cash to fund a record order book, as you have seen in the press release, keep cash for contingencies. Perhaps if the board decides, repay, redeem, the Series E Preferred Shares. Nobody knows. It is a next year issue. 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. It is 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 is a generous payout, compared to other companies in the sector. 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 two 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. Up to now, the total of forward committed earnings is approaching $3.5 billion.

This is a great cushion and great base to look forward to continued success in the next two to three years. Once again, congratulations to Nikolas Tsakos and the team for the stellar results. Sincere wishes for continued success. Thank you very much. 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 all have been living in the U.S. and New York for the last 45 years. Many of us around this table were there 25 years ago. Our original office in New York is just on Rector Street, two blocks south of Ground Zero. 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 on a road show after Labor Day originally in 2001 before these terrible events. It is, 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 looking back at it seems that even after the first 6 months, which have been very profitable, the second part is even stronger. The appetite of the major oil companies and all the charter is unprecedented. I have 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 a rainy day as they say. It is actually also very rewarding to see that we had our largest new building 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 new building program 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 the time where new building values were, I would say, more logical. So looking forward, we are looking for a good year.

As the Chairman said, we are 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 maintain a steady course in the most turbulent geopolitical environment in recent memory. The year started with the political developments 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 world was hoping for a resolution following the signing of a ceasefire agreement, which quickly unraveled halfway through the 60-day period it 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 straits on their own or with the protection of the U.S. Navy. Vessels have been attacked, and seafarers serving on board 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.