TEN Ltd. Reports Profits for the 12 Months and Fourth Quarter Ended December 31, 2024 and Announces Common Share Dividend

In the ever-evolving world of maritime shipping, TEN Ltd. has once again proven its mettle by reporting robust financial results for the twelve months and fourth quarter ended December 31, 2024. The company's strategic moves and operational excellence have not only bolstered its financial health but also positioned it as a formidable player in the global tanker market. Let's dive into the details and understand what this means for income-seeking investors.

A Year of Growth and Stability

TEN Ltd. generated an impressive $804.1 million in gross revenues for the year 2024, with an operating income of $278.6 million. This performance was further bolstered by $48.7 million in capital gains from vessel sales, resulting in a net income of $176.2 million, or $5.03 per common share. The company's fleet utilization stood at 92.5%, with an average Time Charter Equivalent (TCE) per ship per day of $32,550. This is a testament to TEN's efficient management and strategic fleet expansion.



Fleet Expansion and Strategic Moves

One of the standout achievements for TEN Ltd. in 2024 was its dynamic fleet expansion. The company added 21 vessels, resulting in a 36% increase in deadweight tonnage (dwt) and a proforma fleet of 82 vessels. This expansion not only doubled the company's minimum contracted revenues to $4.0 billion but also positioned it as one of the largest shuttle tanker owners in the world. The nine DP2 shuttle tankers on long-term employment to Brazil’s Transpetro are expected to generate contracted revenues of $2.0 billion, providing a stable revenue stream and reducing market risk.

Financial Health and Dividend Policy

TEN Ltd.'s financial health is evident from its solid cash reserves of $348.3 million as of December 31, 2024. The company's total debt and other financial liabilities stood at $1.8 billion, in line with the growth of the fleet. Despite high global interest rates, TEN managed to keep its total finance costs at $112.2 million for the year. The company's uninterrupted dividend payments since its NYSE listing in 2002 further underscore its commitment to shareholder value. In line with its semi-annual common stock dividend policy, TEN's Board of Directors has authorized the payment of $0.60 common stock dividend to be made in July 2025.



Q4 2024 Performance

In the fourth quarter of 2024, TEN's fleet generated gross revenues of $188.3 million and operating income of $42.4 million, resulting in a net income of $19.3 million or $0.42 per common share. The fleet utilization for the quarter was 93.3%, with an average TCE per ship per day of $30,107. The company's adjusted EBITDA for the quarter was $85.6 million, reflecting the number of vessels in dry dock. Vessel operating expenses for the quarter were $50.6 million, with a per ship per day expense of $9,480, showcasing efficient technical management services.

Looking Ahead

TEN Ltd.'s strategic moves and financial performance in 2024 set a strong foundation for future growth. The company's long-term employment strategy, fleet expansion, and efficient management position it well to navigate the challenges and opportunities in the global tanker market. For income-seeking investors, TEN Ltd. offers a compelling case with its stable revenue streams, strong financial health, and commitment to shareholder value.

Red Flags to Watch

While TEN Ltd. presents a strong investment case, it's essential to keep an eye on potential red flags. The company's total debt and other financial liabilities are significant, and any adverse changes in global interest rates could impact its finance costs. Additionally, the maritime industry is subject to geopolitical risks and market volatility, which could affect TEN's performance.

Alternatives if Rates Rise

If global interest rates rise, investors might consider diversifying their portfolios with other high-yield dividend stocks or fixed-income securities. Companies in sectors like utilities, REITs, and telecoms often provide stable dividend income and can serve as alternatives to maritime stocks.

Conclusion

TEN Ltd.'s financial performance for the twelve months and fourth quarter ended December 31, 2024, is a testament to its strategic vision and operational excellence. The company's fleet expansion, long-term employment strategy, and commitment to shareholder value make it an attractive option for income-seeking investors. However, it's crucial to stay vigilant about potential risks and consider diversification to mitigate market volatility.