Teekay Tankers Q1 2024

Teekay Tankers (TNK) reported Q1 2024 results this week

  • Rev $338.3M
  • Adj Net income $132.3M
  • Total Dividend of $2.25 ($0.25 reg + $2 special)
  • Interesting development wrt Aframax (Slide 6)

After paying off a Sale & Leaseback facility for 8 vessels, TNK is almost debt free (their 50% VLCC JV has about $10M of debt). That could be an explanation for the special div. That said, I have been disappointed with TNK/TK mgmt for their lack of vision.

TNK mgmt seem to be happy to let TNK just disappear into the sunset.
I haven’t checked recently, but I want to say TNK’s youngest vessel is a 2015 build. I mean, it isn’t as if they don’t know what to do. A prior TK/TNK mgmt team created an entity called TIL (Tankers Investment Limited) with both TK and TNK as investors (plus external investors), and both companies co-managing the TIL fleet. TIL was quite successful as a standalone entity, and eventually TNK re-acquired the non-owned shares. TNK’s existing fleet probably contains 12 - 15 vessels that were part of TIL. Why don’t TNK or TNK & TK reboot i.e start TIL version 2? If not a full blown TIL II, just even a variation, say a Tanker Joint Venture?


Even worse than I thought - youngest owned vessel is a 2013 build.

11 of their vessels are over 15 yo (built 2008, or earlier)

Plus, Slide 16
Lots of off-hire days in Q2 and Q3


Okay, last thoughts on TNK for Q1-Q2 2024
Skipped most of the company details and focused on the Q&A session.


Three different analysts asked about the fleet renewal strategy. Am paraphrasing what TNK mgmt suggested–
Yes, TNK mgmt recognize the need to replenish their fleet. Both newbuild and 2nd hand market prices are elevated. However, due to current charter rate levels, they would lean towards the 2nd hand market for replacements (due to the more immediate payback). And yes, the charter-in vessels are viewed as potential replacement candidates.

If the thoughts on vessel replacement are only starting to come together now, it seems a little late.