Scorpio Tankers Inc. · NYSE:STNG
Scorpio Tankers — Q2 2022 Earnings Presentation
22 slides from Scorpio Tankers's earnings presentation, Jul 28, 2022
Slide 1: Scorpio Tankers Inc. Second Quarter 2022 Earnings Presentation
Scorpio Tankers Inc. Second Quarter 2022 Earnings Presentation July 28, 2022
Slide 2: Disclaimer and Forward-looking Statements
Disclaimer and Forward-looking Statements This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Scorpio Tankers Inc.’s (“Scorpio’s”) curr
Slide 3: Q2 2022 Call Agenda
Q2 2022 Call Agenda 1.Q2 2022 Highlights 2.Product Tanker Market 3.Financial Highlights 4.Conclusion 5.Q&A 3
Slide 4: Q2 2022 Highlights
Q2 2022 Highlights 4
Slide 5: Q2 2022 Highlights
Q2 2022 Highlights Highlights Q1-22 & Q2-22 TCE Rates ($/day) Financial Results Q1-22 Q2-22 $41,831 • Adj EBITDA of $289.5 million $36,065 $34,904 • Adj net income of $196.1 million or $3.53 basic and $3.13 diluted earnings per share (1) $16,305 $15,949 • $14,475 Dividend of $0.10 per share Improvin
Slide 6: Q2 2022 Highlights
Q2 2022 Highlights Repayment of May 2022 Convertible Bonds • In May 2022, the Company repaid the aggregate outstanding principal balance of $69.7 million on its Convertible Notes due 2022 upon their maturity Repurchase of May 2025 Convertible Bonds • In May and July 2022, the Company repurchased $10
Slide 7: Product Tanker Market
Product Tanker Market 7
Slide 8: Short Term Market Update
Short Term Market Update Weekly MR & LR2 Spot Earnings Since November 2021 ($/day) LR2 Eco-Middle East to Japan MR Eco-Avg Earnings $80,000 $70,000 $60,000 USG-Latin America $50,000 MR Rates Reach Record Levels $40,000 Russia Invades Ukraine $30,000 MR & LR2 spot rates continue to oscillate at stron
Slide 9: Russian Invasion of Ukraine Has the Potential to Disrupt Product Flows
Russian Invasion of Ukraine Has the Potential to Disrupt Product Flows Russian CPP Exports by Type (excl Fuel Oil) (1) Russian Diesel Trade Flows & Potential Changes (mb/d) Diesel/Gasoil Naphtha Gasoline Other 1.8 1.5 1.6 1.5 1.5 1.5 1.5 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 1.2 0.5 0.5 0.5 0.5 0.
Slide 10: Refined Product Demand Expected to Exceed Supply through 2H-22
Refined Product Demand Expected to Exceed Supply through 2H-22 Global Distillate Inventories Have Been Unable to Build (1) Global Diesel Supply / Demand Balance (2) (million barrels) (mb/d) 700 650 600 550 500 450 400 Estimates for 2H-22 May-10 May-11 May-12 May-13 May-14 May-15 May-16 May-17 May-18
Slide 11: Refinery Changes Continue to Drive Ton Mile Demand
Refinery Changes Continue to Drive Ton Mile Demand Refinery Closures By Region (1) Upcoming Refinery CDU Capacity Additions > 200 kb/d (2) (mb/d) (mb/d) North America Europe Asia Pacific Latin America Africa Middle East Saudi Arabia Kuwait China Nigeria Oman Bahrain United States UAE India 1.5 1.0 0
Slide 12: Seaborne Exports & Ton Miles Exceed Pre-Pandemic Levels
Seaborne Exports & Ton Miles Exceed Pre-Pandemic Levels Refined Product Demand Expected to Increase ~4 mb/d from Q1-21 (1) Seaborne Product Exports Remain at or Above Pre COVID Levels Since March (2) (mb/d) (mb/d) 76.9 77.8 78.7 24.0 24.6 74.0 74.7 75.0 23.3 22.4 22.6 23.0 23.2 23.0 69.8 7.2 6.8 7.0
Slide 13: Limited Fleet Growth with Low Orderbook & Ageing Fleet
Limited Fleet Growth with Low Orderbook & Ageing Fleet Orderbook as a % of Fleet at Record Lows Product Tanker Net Fleet Growth 70% Scenario 1 Scenario 2 60% 6.3% 50% 4.8% 4.2% 40% 2.5% 30% 1.9% 2.0% 1.6% 1.1% 0.6% 20% 0.0% 0.3% 10% -0.4% 5% -0.7% -1.4% 0% 2016 2017 2018 2019 2020 2021 2022e 2023e 2
Slide 14: Financial Highlights
Financial Highlights 14
Slide 15: Improving Balance Sheet & Healthy Liquidity Position
Improving Balance Sheet & Healthy Liquidity Position Company to Reduce Outstanding Debt by $686mm in First Nine Months of 2022 Potential for ~$680mm in Pro Forma Liquidity if Fleet TCE $35,000/day in Q3-22 (1) ($USD millions) ($USD millions) $3,500 $677.1 $677.1 $3,164 $700 $3,000 $600 $185.0 $511 $
Slide 16: Significant Operating Leverage & Earnings Potential
Significant Operating Leverage & Earnings Potential Company Fleet TCE Rate Potential Annual Cash Flow Generation Excluding Debt Repayment ($/day) ($USD millions) $1,500 $44,832 $36,006 $1,197 $1,000 $29,693 $990 $784 $22,644 $578 $372 $15,100 $15,415 $500 $11,608 $11,166 $11,954 $12,615 $10,139 $453
Slide 17: Conclusion
Conclusion 17
Slide 18: Investment Highlights
Investment Highlights Inflection Point Largest & Most Improving Has Arrived with Modern Product Balance Sheet & Global Tanker Fleet in Liquidity Reopening from the World Position COVID-19 Highly Attractive Significant Share Price at a Long Term Operating Steep Discount Supply/Demand Leverage to NAV
Slide 19: Q&A
Q&A 19
Slide 20: Appendix
Appendix 20
Slide 21: Quarterly Financial Performance
Quarterly Financial Performance (In '000s of USD) Q2-22 Q1-22 Revenue $ 405,073 $ 174,047 Vessel operating costs (76,923) (84,832) Voyage expenses (23,485) (2,023) Charterhire - - Depreciation (50,819) (53,828) Impairment of vessels and goodwill - - G&A (22,803) (12,454) Loss on vessel sales (1,480)
Slide 22: www.scorpiotankers.com
www.scorpiotankers.com