Thank you for standing by, ladies and gentlemen, and welcome to Tsakos Energy Navigation Conference Call on the Second Quarter 2025 financial results. We have with us today Mr. Takis Arapoglou, Chairman of the Board; Mr. Nikolas Tsakos, Founder and CEO; Mr. George Saroglou, President and Chief Operating Officer; and Mr. Harrys Kosmatos, Co-CFO of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. I would like to advise that this conference is being recorded today. And now I pass the floor over to your host, Mr. Nicolas Bornozis, President of Capital Link and Investor Relations adviser to Tsakos Energy Navigation. Please go ahead, sir.

Thank you very much, and good morning to all of our participants. I am Nicolas Bornozis, President of Capital Link and Investor Relations adviser to Tsakos Energy Navigation. This morning, the company publicly released its financial results for the 2nd quarter and 6 months ended on June 30, 2025. In case you do not have a copy of today's earnings release, please call us at (212) 661-7566 or e-mail us at [email protected], and we will have a copy for you emailed right away. Please note that prior to today's conference call, there is also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please we urge you to access the presentation slides on the company's website. Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user-controlled, meaning that by clicking on the proper button, you can move to the next or to the previous slide on your own. At this time, I would like to read the safe harbor statement. This conference call and slide presentation of the webcast contain certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, which may affect TEN's business prospects and results of operations. And at this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation. Please go ahead, sir.

Thank you. Thank you, Nicolas. Good morning, good afternoon to everyone. In the tanker market with still strong fundamentals, we continue to perform extremely well, sticking to our well-known industrial model that the CEO, Nikolas Tsakos, has described many times, generating healthy contracted revenue under very strict cost control, as you see in the numbers. At the same time, we're selling all the vessels and replacing them with new state-of-the-art ships, keeping a young fleet attractive to our customers. I will remind you that some time ago, we identified the lack of good ratings on VLCCs. We are correcting this now. And as you've seen, we've gone ahead to order 3 new VLCCs with scrubbers and 1. So we are rebalancing the portfolio and we are filling a gap that we always wanted to fill. So again, the results, well done to Nikos Tsakos and his team, best wishes for every success going forward. So over to you, Nikos.

Yes. Thank you, Chairman, and good morning to everybody. It's a pleasure to be here. After the short summer lull, whereas in TEN, we did not experience such a lull because the company was very active during the summer months. We find it always interesting to make sure that during the slow seasonal months of the summer, perhaps it is the best time to do business when not everybody is around their desks. So we've been busy in August with the orders for the 3 plus 1 vessels, taking delivery of vessels in August and in July starting from June of our Suezmaxes and our shuttle tankers with long employment, selling older vessels and ordering, as the Chairman said, supporting the VLCC segment of our company. We have been traditionally a company with a larger number of VLCCs. And we renewed part of the fleet some years ago, and now it's very much time to come up with strong environmentally friendly vessels, all of them built in South Korea in the traditional yards that we have been supporting over the years, like Hyundai. I mean we must be one of the very few companies, but we are very proud to take delivery of our vessels, thanks to our new building capacity and capability. We have delivered over 150 million in new building in the last less than 30 years. These vessels have been delivered from what I would say is the core peer group of shipbuilders in the world. We started in April with Samsung. We moved in June to Hyundai in Korea, and we just renewed our relationship with what used to be called Daewoo, which we're just right now building VLCCs there. So the company is following this model of quality comes first. We have not, through the years, cut corners. We have always done things the correct way, by the book. And I think we are proof that things can work when you actually follow your strategy, follow the rules, and always aim towards quality. This, as mentioned in the press release, has been the beginning of the year and the first 6 months have been a period of turmoil, mainly because we are big supporters of the open seas. And whenever sanctions and tariffs are imposed, of course, this puts question marks and uncertainty in the market that we are facing. However, we have been able to navigate this interesting new times successfully. We paid our first dividend in July, and we're looking forward to announce the next dividend in November. And in the meantime, we are happy to see the appetite of the major oil companies for good quality vessels at very, very accretive rates. And with that, I would like to ask George Saroglou, our President, to give us a more detailed analysis, not very detailed, George, more detail of what has happened in the last 6 months and this subsequent period.

Thank you, Nikos. We are happy to announce another profitable quarter. Tanker markets have remained strong throughout 2025 so far. Major energy companies continue to seek our services for time charter agreements. Currently, our total fleet contracted revenue backlog is around $3.7 billion, translating to more than $120 per share. TEN is one of the largest energy transporters globally. We began with four vessels in 1993 and have turned every crisis in the shipping industry into an opportunity for growth. Today, we have a pro forma fleet of 82 vessels, a reflection of our crisis-resistant model. Over the past 32 years, we have combined self-generated cash, traditional bank loans, and counter-cyclical capital market fundraising to develop our corporate fleet. Maintaining fleet modernity is key to our operations. We construct vessels at top shipyards and acquire modern, high-specification tonnage while selling older vessels. Our fleet is young, diverse, and versatile, catering to both conventional and specialized transportation needs of prominent energy companies. On Slide #4, we present our pro forma fleet of conventional tankers, including crude and product carriers. The vessels trading in the spot market and our new builds under construction are highlighted in red. Since our last earnings call, we have added three new building VLCCs to enhance our presence in a sector that required increased vessel operations, supported by solid fundamentals since a large portion of the VLCC fleet is over 15 years old. Vessels on time charter with profit sharing are shown in light blue, and those on fixed-rate time charters in dark blue. On the next slide, we showcase our pro forma diversified fleet, consisting of our two LNG vessels and our fleet of 16 shuttle tankers. We rank among the largest shuttle tanker operators globally, following our recent agreement with Transpetro in Brazil for nine high-specification shuttle tankers to be constructed at the Samsung shipyard in South Korea. We also have six other tankers in operation after receiving both Athens 04 and Paris 24, which have begun long-term charters with a major energy company. Combining the two slides, our current operating fleet comprises 61 vessels, of which 24 vessels—accounting for 39%—have exposure to the spot market and time charter with profit sharing, while 53 tankers, or 87% of the fleet, are secured under revenue contracts, time charter, or time charter with profit sharing. The next slide features our recurring clients over the year, thanks to our industrial model. ExxonMobil is currently our largest revenue client, followed by Equinor, Shell, Chevron, Total, and BP. We believe our reputation as the preferred carrier for energy majors stems from our fleet, operational and safety record, disciplined financial strategy, and a robust balance sheet. Slide 7 outlines the all-in breakeven costs across the various vessel types we operate. Our business model is straightforward: we aim for our time charter vessels to generate revenue covering the company's cash expenses, including vessel operating costs, finance costs, overheads, and commissions, while spot trading vessels enhance profitability. Evry $1,000 daily increase in spot rates positively contributes $0.10 to our annual EPS, considering the ten vessels currently exposed to spot markets. We maintain a solid balance sheet with strong cash reserves, holding a fleet fair market value of $3.8 billion against $1.8 billion in debt, giving a net debt-to-capital ratio of approximately 42%. Fleet renewal and investments in greener, eco-friendly vessels remain central to our operations. Since January 1, 2023, we have upgraded our fleet by divesting from our first-generation conventional tankers and replacing them with more energy-efficient new builds and modern secondhand tankers, including dual-fuel vessels. In total, we have sold 17 vessels averaging 17.3 years in age and a capacity of 1.4 million deadweight tons and replaced them with 33 contracted and modern acquired vessels averaging less than a year in age and carrying 3.4 times the deadweight capacity of the vessels sold. We continue transitioning our fleet to greener and dual-fuel options, currently being one of the largest owners of dual-fuel LNG-powered Aframax tankers with six vessels operational. The fundamentals remain strong as global demand increases annually. OPEC Plus has further accelerated voluntary production cuts alongside economic sanctions, geopolitical tensions, and events impacting our tanker market favorably, contributing to cost savings in freight rates. Although the tanker order book remains healthy, a significant portion of the global tanker fleet is over 20 years old and requires replacement soon. I will now hand the conversation over to Harrys Kosmatos to discuss our financial performance for the second quarter.

Thank you. Thank you, George. So let me start with the first half highlights. With a slightly larger fleet, both in terms of vessels and deadweight tons when compared to the first half of 2024, TEN during the first 6 months of 2025 continued to place more tonnage on time-charter contracts to adhere to the long-term needs of its clients. As a result, during the first 6 months of 2025, TEN secured charters, including those with proper term provisions, increased by about 14%, while spot contracts experienced a marked decline by about 27%. A point of note, however, is the company's continued belief in the market, which despite TEN's limited exposure in the inherently volatile spot market, which has somewhat shifted from prior periods of the recent past, has increased its presence in profit-sharing contracts by about 28% from the 2024 1st half in order to capture the upside on expected business starting with the upcoming winter months. In addition, during the first 6 months of 2025, 5 vessels underwent scheduled dry dockings from 8 in the same period of 2024, which when combined with the shift in employment patterns explained above resulted in an increase of fleet utilization from 91.9% in the first half of 2024 to 96.9% in the first half of 2025. As a result, TEN's 62 vessels in the water fleet generated $390 million of gross revenues during the first half of 2025 from $415 million in the spot-heavy 2024 first half, averaging a healthy $30,754 per ship per day. The aforementioned shift in employment patterns led to a material reduction in voyage expenses from $83.4 million in the first half of 2024 to about $68 million in the 2025 first 6 months, a $15.5 million reduction. In a similar fashion, charter hire expenses fell from $11 million to $6.6 million, a $4.5 million improvement during the equivalent 6 months time frame. Vessel operating expenses, reflecting the somewhat larger fleet, both in terms of numbers and vessel sizes, were at $102.3 million, slightly higher than the 2024 first half level, equating to a daily average expense of a still competitive $9,743 per vessel. A similar pattern was evident in both depreciation and amortization expenses, which closed the first half of 2025 at $83.2 million, up $6 million from the 2024 period. Unlike the 2024 first half, these results included a near $49 million capital gain from a series of vessel sales. Such gains for the 2025 1st half were reduced to just $3.5 million as a result of the sale of the 2009-built Suezmax tanker during the 1st quarter of 2025. Inclusive of these gains during the first half of 2025, TEN's operating income settled at about $111 million. Interest and finance costs during 2025 were part of a somewhat lower interest rate environment, and 2 refinances of lower margins were $49 million, compared to $35.2 million in the same 2024 6-month period—over $6 million improvement. Interest income during the first half of 2025 reached $5.5 million. General and administrative expenses for the first half of 2025 were $23.1 million, incorporating a management incentive and stock compensation plan. Reflecting all the above, the company generated a net income for the first half of 2025 of $64.5 million or $1.70 per share. Adjusted EBITDA for the first 6 months of 2025 came in at $193.2 million, while total debt net of $287 million of a CASA fund settled at $1.4 billion, leading to a net debt to capital of approximately 43.6%. And now let's go into the 2nd quarter highlights. During the 2nd quarter of 2025, the shift to secured employment was equally evident as time charters and profit-sharing contracts increased by 12% from the 2024 2nd quarter, while spot voyages dropped precipitously by 31.5%, leading to fleet utilization increasing to 96.6% from 92.4% in the 2024 2nd quarter. Worth highlighting here is the 30% increase in total debt of profit-sharing contracts emphasizing the intense employment strategy of downside protection with upside optionality. Resulting from the above and reflecting again a somewhat softer but still healthy market from the 2024 2nd quarter, and after having 3 vessels in dry dock, TEN's fleet generated $193 million of gross revenues equating to $30,767 per vessel per day, which is a healthy performance. Voyage expenses, again due to fewer days of spot contracts declined by about $10 million from the 2024 same period, while short hire expenses also experienced a drop to settle at $3.3 million from $5.1 million in the 2nd quarter of 2025. Operating expenses and not indicated earlier due in the first half overview were just $3 million higher from the 2024 2nd quarter at $52.7 million or $9,982 per ship per day—a still competitive level, thanks to the efficient and profit management performed by TEN's technical monitors. Depreciation and amortization costs during the 2025 2nd quarter, reflecting a slightly higher vessel classes in the fleet, were at $42.1 million from $39.5 million in the 2nd quarter of 2024. During this 2nd quarter, there were no gains or losses on vessel sales registered compared to the 2024 2nd quarter, which recorded capital gains of $32.5 million. As a result, operating income for the 2nd quarter of 2025 settled at $50 million. An increase in finance costs during the 2nd quarter of 2025 was $5 million lower from the 2024 2nd quarter, up to $25 million while interest income reached $3.2 million. Taking all the above into consideration, TEN during the 2nd quarter of 2025 generated a net income of $26.8 million, which equates to $0.67 per share. In ending, adjusted EBITDA for the 2025 2nd quarter was up approximately $94 million.

Thank you, Harrys, for your detailed analysis. And with this, we would like to open the floor for any questions or input that you may have. Thank you.

Thank you. At this time, we'll be conducting a question-and-answer session. My first question comes from Poe Fratt with Alliance Global Partners.

Can we discuss the new build orders for the VLCCs? As you mentioned in the last quarterly call, it seemed you hinted at this. Can you explain how you made the decision to pursue new builds instead of acquiring assets in the open market?

Yes. Thank you. Well, we are always looking for good quality vessels in the open market also. So I mean, we do not exclude this happening. We took advantage of the strong secondhand market to sell vessels—perhaps it is when it's a good time to sell vessels, and we made a significant cash profit on the overall sale of 18-year-old vessels. It means that it's not perhaps the best time to acquire secondhand vessels because they are pricey. So I believe that it's very, very good for us. We are very competent and experienced new building site offices in Korea and Japan in the past. So it has been—it makes much more sense since we are building a big number of vessels in the first-class Korean yards with the site officer to build the environmentally friendly vessels of the future that are actually following all the upcoming regulations and are built in the yards to traditional ship-building standards. So I think VLCCs have been part of our portfolio that we are lagging behind. And I think that's a very good opportunity to find. We believe the reason we are able to run ships at, I would say, significantly lower operating expenses than a large part of our peer group is because we tend to build good quality ships and sister vessels. That helps us very much in keeping operational expenses and the experience of our seafarers, the crew, and the captains. It's like running, let's say, a very similar fleet of airplanes or a very similar fleet of Boeings—in order for—to have the training for the crew, the spare parts for all the vessels, and it gives us a lot of flexibility.

Great. And then if you could clarify whether you exercised the option that you had when you first announced the VLCC new builds? And then secondly, typically, when you have a new build, you usually have a contract or a time charter set up in advance of delivery. Do you currently have a time charter in place? Or when do you anticipate securing a time charter for the VLCCs?

Yes. I think what we did is we opted for the option and we actually got an extra option for another couple of months because we believe that it's good to maintain these price levels going forward in a very uncertain environment. So the options are always valuable. So actually, yes, we have 3 foreign vessels right now, plus an additional option in the same yard in the same quality. The VLCC market is a very hot market. We have actually 3 of our existing VLs are opening in the next 6 months, and we see a lot of appetite. I mean we're in the process of renewing some of the existing VLs going forward with significant increased base rates and profit-sharing arrangements. With the new orders, there is a lot of appetite, but it's still early to make a decision. So we will be taking care of more of the 3 existing ships, very young ships also themselves. But it gives us with 6 VLs and perhaps more coming, it's starting to get critical mass in that very interesting segment of the tanker market.

Great. And then could you preview—I know that you talked about declaring the second-half dividend in the November time frame. Can you preview it at this point in time? Or is it just too early?

Well, I think it is early, but we are looking at a healthy market. So we are expecting for the Board to opt for a healthy dividend. I think we are in a good space, I would say.

Okay. And then on the last call, you talked about potentially given the current valuation in the equity market, restructuring the company or looking at alternatives, maybe splitting the company into a company that has twofold: one with long-term time charters in place, especially on the shuttle tankers versus assets that have shorter-term time charters. Any progress or any comments on that type of move?

First of all, we are not restructuring the company. We have never restructured any part of our debt or the company. So I think TEN is one of the few companies that—I'm just joking—we're not restructuring. We're always thinking out of the box. I think we are very happy to where we are today with the growth of the company, with the profitability of the company. One thing that I would say, like other shipping companies, but especially ourselves, we are disappointed with share performance, and we're trying to—I think our company should easily have a market cap of $2 billion from where it is today. So we're always thinking of ways to get shareholders' interest and appreciation. We are going through a period where inflation is around, going through a period where real assets matter. I think this is—and we have very, very, very real assets and quite undervalued real assets. What we want to do is to be able to have a much more efficient structure to provide more value for our shareholders. So we have thought of perhaps having one of the largest tanker fleets plus a lot of long-term business and specialized vessels to do something down the road in the next 8 quarters, I would say, and perhaps putting the more specialized vessels in a vehicle that, of course, TEN will be by far the major shareholder. However, these are ideas that we are discussing with our investment bankers, but there's nothing imminent, I would say, for the next 4 quarters.

Okay. And then could you preview or give me an idea of the direction of OpEx and G&A over the second half of the year? It looks like the first half G&A especially might have had some one-time items in it.

Yes. Well, I think we are putting a lot of emphasis; we are running things hands-on and we look at our technical management—managers almost on a weekly and monthly performance. We are facing some inflation issues, but I think we have been able to cap the majority, and we still have an average for such a big diversified fleet, which includes DP vessels, which the operating expense of those ships are in the high teens. We are still under $10,000 on operating expenses. We put a lot of emphasis in running a tight ship, literally. I believe that we will be able to maintain the expenses there.

There are no further questions at this time. At this point, I'd like to turn the call back over to Mr. Tsakos for closing comments.

Well, again, thank you for attending our call. In the first 6 months, I think moving forward has been an exciting time for the energy markets. I believe that we are here to see even more solid results coming forward. The energy part of the world economy is becoming more and more important. The players right now are getting more. We're seeing the shipping energy part of the business, where really you have a two-tier market. You have vessels growing in numbers that do not serve the core part of the business, and this allows us with modern high-specification vessels to have more opportunities to serve our major clients. I believe I am optimistic that we're going to see at least in the near future, another 18 months over a very solid, perhaps even stronger market. We also see actions from the administration in the United States to support shipping, which is important because shipping and energy transportation have always been in the background. We provide a significant service, a very big service for the world economy. However, in a way, we are kind of the unsung sailors, not heroes, the unsung sailors of the world economy. I don't think it's good to see that people are paying much more attention to the services we provide, be it on the LNG, be it on the crude or on the product segment. I will be in the United States in the next couple of weeks, having meetings specifically on ways where simple transportation and especially energy transportation is going to be appreciated and assisted more. This will be beneficial for both the charterers and the shipowners. I think we have an optimistic view going forward. With that, I would like to thank everybody. I will ask Mr. Arapoglou, our Chairman, if he wants to have a closing statement.

Thank you, Nikos. Just to say that we believe the market does not continue to appreciate the nearly $4 billion of minimum contracted revenue for TEN and keeps looking at us like any other shipping company with high volatility and low predictability of income and revenues. We feel that perhaps the market has begun focusing on it, but we believe the value of the stock is much higher than where it is today. As far as dividends are concerned, the CEO just mentioned that the Board is going to look at the results of the third quarter and be able to perhaps announce—make a decision on the dividend in a few months' time. We continue to be very positive on that front. So with that, thank you very much. Thank you, Niko.

Thank you. I think we will be attending events in London for the London International Shipping Week, including a capital league event where our CFO is going to be a speaker, and the following week in New York. Hope to see you face-to-face. Thank you very much, and have a good rest of the day.

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.