Scorpio Tankers Q2 Earnings Call Highlights

Record second-quarter performance: Scorpio Tankers reported adjusted EBITDA of $300.5 million and adjusted net income of $243.7 million, with IFRS net income reaching $388 million after a $154 million gain from selling 10 vessels. Balance sheet and shareholder returns strengthened: The company refinanced expensive debt with $605 million of convertible bonds issued at roughly a 1% yield, reduced cash break-even below $11,000 per day, and ended with $2.4 billion in liquidity. It returned more than $175 million to shareholders through a $0.45 dividend and $155 million in share repurchases. Management sees supportive tanker fundamentals: Longer shipping distances, aging and sanctioned tonnage, and flexible deployment of LR2 vessels between clean-product and crude trades are supporting rates above $30,000 per day, despite lower refined-product volumes.

Scorpio Tankers NYSE: STNG reported its strongest quarterly results in company history for the second quarter of 2026, supported by elevated tanker rates, vessel sales and continued balance-sheet refinancing efforts. Chief Executive Officer Emanuele Lauro said the company generated adjusted EBITDA of more than $300 million and adjusted net income of $243.7 million during the quarter. Chief Financial Officer Chris Avella said adjusted EBITDA totaled $300.5 million, while IFRS net income was $388 million, including a $154 million gain from the sale of 10 vessels during the period.

Management said it continued to focus on lowering funding costs, reducing cash break-even levels, renewing the fleet and returning capital to shareholders. Financing and shareholder returns Lauro said Scorpio Tankers issued $605 million of convertible bonds at a yield to maturity of approximately 1% and repaid $589 million of debt carrying interest rates between 5% and 7.5%. Avella said the company repaid more than $389 million of secured debt across five facilities during the second quarter and redeemed $200 million of 7.5% senior unsecured notes in July.

The company’s cash break-even rate, including vessel operating costs, cash general and administrative expense, cash interest and scheduled loan amortization, fell below $11,000 per day, according to Avella. He said that at a daily rate of $20,000, the company could generate up to $246 million in annual cash flow, while a $30,000 daily rate could generate up to $520 million. As of July 28, Scorpio Tankers had $2.2 billion in cash and $483 million of availability under revolving credit facilities, for total available liquidity of $2.4 billion, Avella said. He added that the company’s net debt position had improved by $4.2 billion since December 2021, reaching net cash of $1.3 billion, or approximately $26 per share.

The board declared a quarterly dividend of $0.45 per share. Scorpio Tankers also repurchased approximately 2 million shares for $155 million during the quarter. Lauro said the combined dividend and buyback represented more than $175 million returned to shareholders. Addressing the company’s convertible notes, President Robert Bugbee said Scorpio Tankers has the option to settle conversions in cash, common shares or a combination of both. The notes have a conversion trigger at 130% above the conversion price, he said, and the maximum number of shares that could be issued is 6 million. Fleet renewal and expansion Since the beginning of the year, Scorpio Tankers has sold 19 vessels, primarily ships that were 11 or 12 years old, Lauro said. He said most of the vessels were sold for more than the company had paid for them more than a decade earlier. The...