INSW 10-Q

International Seaways, Inc. (INSW)

10-Q 2023-11-07 For: 2023-09-30

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Added on April 12, 2026

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Marshall Islands		98-0467117
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

600 Third Avenue, 39^th Floor, New York, New York		10016
(Address of principal executive offices)		(Zip Code)



Large accelerated filer ☒	Accelerated filer ☐	Emerging growth company ☐

Non-accelerated filer ☐	Smaller reporting company ☐


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock (no par value)	INSW	New York Stock Exchange
Rights to Purchase Common Stock	N/A	New York Stock Exchange


	September 30, 2023		December 31, 2022
ASSETS
Current Assets:
Cash and cash equivalents	$	138,976	$	243,744
Short-term investments		75,000		80,000
Voyage receivables, net of allowance for credit losses of $129 and $261
including unbilled receivables of $212,340 and $279,567		219,827		289,775
Other receivables		11,285		12,583
Inventories		1,143		531
Prepaid expenses and other current assets		11,567		8,995
Current portion of derivative asset		7,092		6,987
Vessels held for sale		8,985		—
Total Current Assets		473,875		642,615
Vessels and other property, less accumulated depreciation of $404,280 and $331,903		1,947,740		1,680,010
Vessels construction in progress		—		123,940
Deferred drydock expenditures, net		72,314		65,611
Operating lease right-of-use assets		22,738		8,471
Finance lease right-of-use assets		—		44,391
Pool working capital deposits		33,501		35,593
Long-term derivative asset		4,520		4,662
Other assets		6,334		10,041
Total Assets	$	2,561,022	$	2,615,334

LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities	$	42,850	$	51,069
Current portion of operating lease liabilities		9,784		1,596
Current portion of finance lease liabilities		—		41,870
Current installments of long-term debt		134,703		162,854
Total Current Liabilities		187,337		257,389
Long-term operating lease liabilities		14,021		7,740
Long-term debt		706,999		860,578
Other liabilities		2,588		1,875
Total Liabilities		910,945		1,127,582

Commitments and contingencies

Equity:
Capital - 100,000,000 no par value shares authorized; 48,893,133 and 49,120,648
shares issued and outstanding		1,489,041		1,502,235
Retained earnings/(accumulated deficit)		155,877		(21,447)
		1,644,918		1,480,788
Accumulated other comprehensive income		5,159		6,964
Total Equity		1,650,077		1,487,752
Total Liabilities and Equity	$	2,561,022	$	2,615,334


	Three Months Ended September 30,				Nine Months Ended September 30,
		2023		2022		2023		2022
Shipping Revenues:
Pool revenues, including $72,877, $52,722, $250,909 and $107,106
from companies accounted for by the equity method	$	194,465	$	215,240	$	701,634	$	463,729
Time charter revenues		27,587		8,487		66,849		22,795
Voyage charter revenues		19,656		13,102		52,558		39,984
		241,708		236,829		821,041		526,508

Operating Expenses:
Voyage expenses		5,756		2,283		13,434		8,448
Vessel expenses		64,596		58,565		188,516		178,445
Charter hire expenses		11,297		7,797		30,599		22,799
Depreciation and amortization		33,363		27,728		95,356		81,984
General and administrative		12,314		11,839		35,082		32,852
Third-party debt modification fees		148		71		568		1,158
Loss/(gain) on disposal of vessels and other assets, net of impairments		74		139		(10,648)		(9,339)
Total operating expenses		127,548		108,422		352,907		316,347
Income from vessel operations		114,160		128,407		468,134		210,161
Equity in results of affiliated companies		—		(1)		—		434
Operating income		114,160		128,406		468,134		210,595
Other income/(expense)		646		360		8,308		(440)
Income before interest expense and income taxes		114,806		128,766		476,442		210,155
Interest expense		(16,817)		(15,332)		(51,678)		(40,630)
Income before income taxes		97,989		113,434		424,764		169,525
Income tax provision		(52)		(7)		(432)		(63)
Net income	$	97,937	$	113,427	$	424,332	$	169,462

Weighted Average Number of Common Shares Outstanding:
Basic		48,861,356		49,312,716		49,008,901		49,493,315
Diluted		49,275,022		49,743,700		49,442,825		49,758,196

Per Share Amounts:
Basic net income per share	$	2.00	$	2.30	$	8.65	$	3.42
Diluted net income per share	$	1.99	$	2.28	$	8.58	$	3.40


			Retained		Accumulated
			Earnings /		Other
			(Accumulated		Comprehensive		Noncontrolling
	Capital		Deficit)		Income/(loss)		Interests		Total
For the nine months ended
Balance at January 1, 2023	$	1,502,235	$	(21,447)	$	6,964	$	—	$	1,487,752
Net income		—		424,332		—		—		424,332
Other comprehensive loss		—		—		(1,805)		—		(1,805)
Dividends declared		—		(247,008)		—		—		(247,008)
Forfeitures of vested restricted stock awards and exercised stock options		(5,158)		—		—		—		(5,158)
Compensation relating to restricted stock awards		768		—		—		—		768
Compensation relating to restricted stock units awards		4,688		—		—		—		4,688
Compensation relating to stock option awards		456		—		—		—		456
Repurchase of common stock		(13,948)		—		—		—		(13,948)
Balance at September 30, 2023	$	1,489,041	$	155,877	$	5,159	$	—	$	1,650,077

Balance at January 1, 2022	$	1,591,446	$	(409,338)	$	(12,360)	$	584	$	1,170,332
Net income		—		169,462		—		—		169,462
Other comprehensive income		—		—		23,193		—		23,193
Dividends declared		(14,827)		—		—		—		(14,827)
Impact of deconsolidating DASM		—		—		—		(584)		(584)
Forfeitures of vested restricted stock awards and exercised stock options		(3,174)		—		—		—		(3,174)
Compensation relating to restricted stock awards		902		—		—		—		902
Compensation relating to restricted stock units awards		2,782		—		—		—		2,782
Compensation relating to stock option awards		763		—		—		—		763
Repurchase of common stock		(20,017)		—		—		—		(20,017)
Balance at September 30, 2022	$	1,557,875	$	(239,876)	$	10,833	$	—	$	1,328,832

For the three months ended
Balance at July 1, 2023	$	1,487,151	$	127,368	$	5,755	$	—	$	1,620,274
Net income		—		97,937		—		—		97,937
Other comprehensive loss		—		—		(596)		—		(596)
Dividends declared		—		(69,428)		—		—		(69,428)
Forfeitures of vested restricted stock awards and exercised stock options		(149)		—		—		—		(149)
Compensation relating to restricted stock awards		277		—		—		—		277
Compensation relating to restricted stock units awards		1,645		—		—		—		1,645
Compensation relating to stock option awards		117		—		—		—		117
Balance at September 30, 2023	$	1,489,041	$	155,877	$	5,159	$	—	$	1,650,077

Balance at July 1, 2022	$	1,583,740	$	(353,303)	$	127	$	584	$	1,231,148
Net income		—		113,427		—		—		113,427
Other comprehensive income		—		—		10,706		—		10,706
Dividends declared		(5,886)		—		—		—		(5,886)
Impact of deconsolidating DASM		—		—		—		(584)		(584)
Forfeitures of vested restricted stock awards and exercised stock options		(1,681)		—		—		—		(1,681)
Compensation relating to restricted stock awards		319		—		—		—		319
Compensation relating to restricted stock units awards		1,175		—		—		—		1,175
Compensation relating to stock option awards		225		—		—		—		225
Repurchase of common stock		(20,017)		—		—		—		(20,017)
Balance at September 30, 2022	$	1,557,875	$	(239,876)	$	10,833	$	—	$	1,328,832


(Dollars in thousands)		Allowance for Credit Losses - Voyage Receivables
Balance at December 31, 2022	$	261
Reversal of expected credit losses		(132)
Balance at September 30, 2023	$	129


	Crude		Product
(Dollars in thousands)	Tankers		Carriers		Other		Totals
Three months ended September 30, 2023:
Shipping revenues	$	114,250	$	127,458	$	—	$	241,708
Time charter equivalent revenues		110,766		125,186		—		235,952
Depreciation and amortization		20,039		13,298		26		33,363
Loss on disposal of vessels and other assets		13		61		—		74
Adjusted income/(loss) from vessel operations		58,926		67,796		(26)		126,696
Adjusted total assets at September 30, 2023		1,520,485		795,568		—		2,316,053

Three months ended September 30, 2022:
Shipping revenues	$	77,071	$	159,758	$	—	$	236,829
Time charter equivalent revenues		75,192		159,355		(1)		234,546
Depreciation and amortization		15,771		11,931		26		27,728
Loss on disposal of vessels and other assets, net of impairments		77		62		—		139
Adjusted income/(loss) from vessel operations		30,993		109,490		(27)		140,456
Equity in results of affiliated companies		(1)		—		—		(1)
Investments in and advances to affiliated companies at September 30, 2022		16,301		21,808		—		38,109
Adjusted total assets at September 30, 2022		1,356,386		819,768		—		2,176,154


(Dollars in thousands)	September 30, 2023		September 30, 2022
Adjusted total assets of all segments	$	2,316,053	$	2,176,154
Corporate unrestricted cash and cash equivalents		138,976		174,465
Restricted cash		—		1,060
Short-term investments		75,000		80,000
Other unallocated amounts		30,993		28,224
Consolidated total assets	$	2,561,022	$	2,459,903


(Dollars in thousands)	Condensed Consolidated Balance Sheet
Pool working capital deposits	$	33,501


(Dollars in thousands)		Condensed Consolidated Balance Sheet	Maximum Exposure to Loss
Other Liabilities	$	–	$	33,501


(Dollars in thousands)	Current portion of derivative asset		Long-term derivative assets		Current portion of derivative liabilities		Long-term derivative liabilities		Other receivables
September 30, 2023:
Derivatives designated as hedging instruments:
Interest rate swaps	$	7,092	$	4,520	$	—	$	—	$	1,000
Total	$	7,092	$	4,520	$	—	$	—	$	1,000

December 31, 2022:
Derivatives designated as hedging instruments:
Interest rate swaps	$	6,987	$	4,662	$	—	$	—	$	547
Total	$	6,987	$	4,662	$	—	$	—	$	547


Declaration Date	Record Date	Payment Date	Regular Quarterly Dividend per Share	Supplemental Dividend per Share	Total Dividends Paid
February 27, 2023	March 14, 2023	March 28, 2023	$0.12	$1.88	$98.3 million
May 4, 2023	June 14, 2023	June 28, 2023	$0.12	$1.50	$79.3 million
August 8, 2023	September 13, 2023	September 27, 2023	$0.12	$1.30	$69.4 million


(Dollars in thousands)	Unrealized gains/(losses) on cash flow hedges		Items not yet recognized as a component of net periodic benefit cost		Total
Balance as of June 30, 2023	$	16,155	$	(10,400)	$	5,755
Current period change, excluding amounts reclassified
from accumulated other comprehensive income		1,897		372		2,269
Amounts reclassified from accumulated other comprehensive income		(2,865)		—		(2,865)
Balance as of September 30, 2023	$	15,187	$	(10,028)	$	5,159

Balance as of June 30, 2022	$	6,865		(6,738)		127
Current period change, excluding amounts reclassified
from accumulated other comprehensive income		10,559		594		11,153
Amounts reclassified from accumulated other comprehensive income		(447)		—		(447)
Balance as of September 30, 2022	$	16,977	$	(6,144)	$	10,833


(Dollars in thousands)	Voyage receivables - Billed receivables		Contract assets (Unbilled voyage receivables)		Contract liabilities (Deferred revenues and off hires)
Opening balance as of January 1, 2023	$	9,452	$	1,866	$	—
Closing balance as of September 30, 2023		5,389		1,442		—


	Nine Months Ended September 30,
		2023		2022
Cash Flows from Operating Activities:
Net income	$	424,332	$	169,462
Items included in net income not affecting cash flows:
Depreciation and amortization		95,356		81,984
Loss on write-down of vessels and other assets		—		1,697
Amortization of debt discount and other deferred financing costs		4,491		3,630
Amortization of time charter hire contracts acquired		—		842
Deferred financing costs write-off		1,952		610
Stock compensation		5,912		4,447
Equity in results of affiliated companies		20		(10,017)
Other – net		(2,140)		(774)
Items included in net income related to investing and financing activities:
Gain on disposal of vessels and other assets, net		(10,648)		(11,036)
Loss on extinguishment of debt		1,323		—
Loss on sale of investments in affiliated companies		—		9,513
Cash distributions from affiliated companies		—		2,250
Payments for drydocking		(27,622)		(36,280)
Insurance claims proceeds related to vessel operations		2,858		4,545
Changes in operating assets and liabilities:
Decrease/(increase) in receivables		69,948		(123,045)
Increase in deferred revenue		911		1,009
Net change in inventories, prepaid expenses and other current assets, accounts
payable, accrued expenses and other current and long-term liabilities		(3,774)		7,364
Net cash provided by operating activities		562,919		106,201
Cash Flows from Investing Activities:
Expenditures for vessels, vessel improvements and vessels under construction		(192,218)		(87,603)
Proceeds from disposal of vessels and other property, net		20,036		79,476
Expenditures for other property		(1,035)		(674)
Investments in short-term time deposits		(210,000)		(80,000)
Proceeds from maturities of short-term time deposits		215,000		—
Pool working capital deposits		(1,334)		1,862
Proceeds from sale of investments in affiliated companies		—		138,966
Net cash (used in)/provided by investing activities		(169,551)		52,027
Cash Flows from Financing Activities:
Issuance of debt, net of issuance and deferred financing costs
Borrowings on long term debt, net of lenders' fees		—		641,050
Borrowings on revolving credit facilities		50,000		—


(Dollars in thousands)	September 30, 2023		December 31, 2022		Fair Value Level
Cash and cash equivalents	$	138,976	$	243,744		Level 1
Short-term investments ⁽¹⁾		75,000		80,000		Level 1
$750 Million Facility Term Loan ⁽²⁾		(171,442)		(493,565)		Level 2
$160 Million Revolving Credit Facility ⁽³⁾		(50,000)		—		Level 2
ING Credit Facility ⁽²⁾		(21,354)		(22,917)		Level 2
Ocean Yield Lease Financing ⁽²⁾		(319,266)		(341,106)		Level 2
BoComm Lease Financing ⁽⁴⁾		(207,359)		(63,598)		Level 2
Toshin Lease Financing ⁽⁴⁾		(13,600)		(14,744)		Level 2
Hyuga Lease Financing ⁽⁴⁾		(13,694)		(14,853)		Level 2
COSCO Lease Financing ⁽²⁾		—		(47,732)		Level 2
Kaiyo Lease Financing ⁽⁴⁾		(12,536)		(13,797)		Level 2
Kaisha Lease Financing ⁽⁴⁾		(12,630)		(13,704)		Level 2


(Dollars in thousands)	September 30, 2023		December 31, 2022		Fair Value Level
Derivative Assets (interest rate swaps)	$	12,612	$	12,196		Level 2⁽¹⁾


(Dollars in thousands)	September 30, 2023		December 31, 2022
$750 Million Facility Term Loan, due 2027, net of unamortized deferred finance costs of $4,290 and $6,400	$	167,152	$	487,164
$160 Million Revolving Credit Facility, due 2029		50,000		—
ING Credit Facility, due 2026, net of unamortized deferred finance costs of $325 and $416		21,030		22,501
Ocean Yield Lease Financing, due 2031, net of unamortized deferred finance costs of $2,789 and $3,198		316,477		337,908
BoComm Lease Financing, due 2030, net of unamortized deferred finance costs of $4,351 and $917		232,843		71,140
Toshin Lease Financing, due 2031, net of unamortized deferred finance costs of $317 and $370		14,240		15,215
COSCO Lease Financing, due 2028, net of unamortized deferred finance costs of $ and $1,187		—		46,544
Hyuga Lease Financing, due 2031, net of unamortized deferred finance costs of $279 and $323		14,121		15,093
Kaiyo Lease Financing, due 2030, net of unamortized deferred finance costs of $241 and $285		12,868		13,884
Kaisha Lease Financing, due 2030, net of unamortized deferred finance costs of $253 and $298		12,971		13,983
		841,702		1,023,432
Less current portion		(134,703)		(162,854)
Long-term portion	$	706,999	$	860,578


(Dollars in thousands)	Amount		Operating Days
2023	$	2,427	92
2024		9,657	366
2025		4,301	163
Total lease payments (lease component only)		16,385	621
less imputed interest		(871)
Total operating lease liabilities	$	15,514


(Dollars in thousands)		Amount
2023⁽¹⁾	$	(142)
2024		1,262
2025		1,093
2026		1,113
2027		1,077
Thereafter		5,831
Total lease payments		10,234
less imputed interest		(1,943)
Total operating lease liabilities	$	8,291


(Dollars in thousands)	Amount		Revenue Days
2023	$	26,369	933
2024		99,329	3,518
2025		66,719	2,287
2026		42,610	1,360
2027		33,945	1,095
Thereafter		75,051	2,421
Future minimum revenues	$	344,022	11,614


(Dollars in millions)	Amount⁽¹⁾
2023	$	26.4
2024		99.3
2025		66.7
2026		42.6
2027		33.9
Thereafter		75.1
Future minimum revenues	$	344.0


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in thousands, except daily rate amounts)		2023		2022		2023		2022
TCE revenues	$	110,766	$	75,192	$	388,963	$	171,124
Vessel expenses		(29,111)		(24,713)		(83,155)		(72,525)
Charter hire expenses		(2,690)		(3,715)		(9,239)		(11,773)
Depreciation and amortization		(20,039)		(15,771)		(56,583)		(46,109)
Adjusted income from vessel operations ^(a)	$	58,926	$	30,993	$	239,986	$	40,717
Average daily TCE rate	$	41,470	$	33,993	$	50,699	$	24,700
Average number of owned vessels ^(b)		21.0		18.0		19.7		18.7
Average number of vessels chartered-in		9.1		9.0		9.3		9.1
Number of revenue days ^(c)		2,671		2,212		7,672		6,928
Number of ship-operating days: ^(d)
Owned vessels		1,930		1,656		5,368		5,114
Vessels bareboat chartered-in under leases ^(e)		830		828		2,509		2,457
Vessels spot chartered-in under operating leases ^(f)		4		1		19		14


	2023				2022
	Spot Earnings		Fixed Earnings		Spot Earnings		Fixed Earnings
Three Months Ended September 30,
VLCC:
Average rate	$	40,961	$	35,319	$	24,427	$	43,905
Revenue days		870		297		812		92
Suezmax:
Average rate	$	38,708	$	30,973	$	34,244	$	27,685
Revenue days		1,012		184		849		92
Aframax:
Average rate	$	34,046	$	38,652	$	38,287	$	—
Revenue days		232		73		366		—

Nine Months Ended September 30,
VLCC:
Average rate	$	46,342	$	40,597	$	17,739	$	44,111
Revenue days		2,431		703		2,421		218
Suezmax:
Average rate	$	52,627	$	31,093	$	23,090	$	27,004
Revenue days		2,996		496		2,872		273
Aframax⁽¹⁾:
Average rate	$	47,640	$	38,652	$	29,215	$	—
Revenue days		926		73		999		—
Panamax:
Average rate	$	—	$	—	$	20,166	$	—
Revenue days		—		—		70		—


												Beyond
(Dollars in thousands)		2023		2024		2025		2026		2027		2027		Total
$750 Million Facility Term Loan - floating rate⁽¹⁾	$	23,225	$	90,643	$	68,965	$	—	$	—	$	—	$	182,833
$160 Million Revolving Credit Facility - floating rate⁽²⁾		922		3,668		3,668		3,658		3,648		54,540		70,104
ING Credit Facility - floating rate⁽³⁾		933		3,634		3,473		17,896		—		—		25,936
Ocean Yield Lease Financing - floating rate⁽⁴⁾		14,317		54,732		52,324		51,193		50,128		248,895		471,589
BoComm Lease Financing - fixed rate⁽⁵⁾		5,989		23,827		23,762		23,762		23,762		189,860		290,962
Toshin Lease Financing - fixed rate⁽⁵⁾		558		2,223		2,160		2,160		2,151		9,157		18,409
Hyuga Lease Financing - fixed rate⁽⁵⁾		567		2,456		2,232		2,232		2,232		8,576		18,295
Kaiyo Lease Financing - fixed rate⁽⁵⁾		563		2,250		2,250		2,410		2,214		6,554		16,241
Kaisha Lease Financing - fixed rate⁽⁵⁾		563		2,250		2,438		2,225		2,214		6,714		16,404
Operating lease obligations⁽⁶⁾
Time Charter-ins		3,174		12,627		5,624		—		—		—		21,425
Office and other space		(142)		1,262		1,093		1,113		1,077		5,831		10,234
Vessel and vessel betterment commitments⁽⁷⁾		15,084		14,356		92,384		—		—		—		121,824
Total	$	65,753	$	213,928	$	260,373	$	106,649	$	87,426	$	530,127	$	1,264,256




**10.1		$160 Million Revolving Credit Agreement, dated as of September 27, 2023, among the Registrant, International Seaways Operating Corporation, the other Guarantors from time to time parties thereto, the Lenders parties thereto, Nordea Bank Abp, New York Branch, as administrative agent, Collateral Agent, Coordinator and security trustee for the Secured Parties, and ING Bank N.V., London Branch, as sustainability coordinator.

**31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.

**31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.

**32		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EX-101.INS		Inline XBRL Instance Document

EX-101.SCH		Inline XBRL Taxonomy Extension Schema

EX-101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase

EX-101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase

EX-101.LAB		Inline XBRL Taxonomy Extension Label Linkbase

EX-101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase

EX-104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)



	INTERNATIONAL SEAWAYS, INC.
	(Registrant)

Date: November 7, 2023	/s/ Lois K. Zabrocky
	Lois K. Zabrocky
	Chief Executive Officer

Date: November 7, 2023	/s/ Jeffrey D. Pribor
	Jeffrey D. Pribor
	Chief Financial Officer