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International Seaways, Inc. (INSW)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered solid results with revenue of $196.4M, diluted EPS of $1.42, adjusted EPS of $1.15, and adjusted EBITDA of $108M; results were lower year over year on softer spot TCEs and fewer revenue days but improved sequentially across several KPIs .
  • Clear beats vs S&P consensus: EPS $1.15 vs $0.94 (+$0.21), revenue $196.4M vs $186.2M (+$10.1M), and adjusted EBITDA $106.2M vs $93.5M; setup into Q4 looks stronger with blended spot TCE booked at ~$40,400/day on 47% of expected days, implying higher near‑term cash generation (bold beat) .
  • Capital allocation and balance sheet optionality stepped up: $250M 7.125% unsecured bond to retire sale-leasebacks on six VLCCs, lowering mandatory amortization and unencumbering assets; total liquidity $985M at quarter-end; declared combined dividend of $0.86/share (75% of adjusted NI), the 24th consecutive quarterly dividend .
  • Stock reaction catalysts: stronger Q4 bookings, continued 75% payout, VLCC acquisition closing in Q4, and unencumbering six VLCCs; modest headwind as 2026 spot break-even increased to ~$14,500/day from ~$13,100 prior due to higher opex/drydock timing (guidance datapoint) .

What Went Well and What Went Wrong

  • What Went Well

    • Outperformed Street on EPS, revenue, and EBITDA; CFO highlighted cost control and cash generation with adjusted EBITDA of $108M and free cash flow of ~$63M in Q3, supported by $67M vessel sale proceeds (bold beat) .
    • Balance sheet optimization: $250M Nordic bond (7.125%) to exercise $258M purchase options on sale-leasebacks, unencumbering six VLCCs and eliminating ~$22M in annual mandatory principal payments .
    • Management tone constructive on tanker fundamentals with tighter supply, rising OPEC+/Americas volumes, and trade inefficiencies; “Market conditions strengthened late in the third quarter and have remained firm, with forward fixtures well above year-ago levels.” – CEO Lois Zabrocky .

  • What Went Wrong

    • YoY softness: Q3 revenue $196M vs $225M and adjusted EBITDA $108M vs $130M as TCEs eased and revenue days fell; Suezmax spot ~33.3k/day vs ~38.0k/day, LR1 ~34.6k vs ~46.9k, MR ~25.6k vs ~29.0k .
    • 2026 spot cash break-even raised to ~$14,500/day from ~$13,100 prior, reflecting higher operating costs and drydock timing (less favorable) .
    • Future contracted TC revenue decreased to ~$229M from ~$261M as of July 1 given roll-offs (less visibility), though management expects to keep a portion fixed .

Financial Results

Headline financials (GAAP and non-GAAP)

MetricQ3 2024Q2 2025Q3 2025
Shipping Revenues ($USD Millions)$225.2 $195.6 $196.4
TCE Revenues ($USD Millions, non‑GAAP)$219.7 $188.8 $192.5
Adjusted EBITDA ($USD Millions, non‑GAAP)$130.0 $101.5 $107.7
Diluted EPS ($)$1.84 $1.25 $1.42
Adjusted EPS ($)$1.57 $1.02 $1.15

Q3 actual vs S&P Global consensus

MetricQ3 2025 ConsensusQ3 2025 ActualSurprise
EPS ($)0.94*1.15 +0.21 (beat)*
Revenue ($USD Millions)186.25*196.39 +10.14 (beat)*
Adjusted EBITDA ($USD Millions)93.50*106.20 +12.70 (beat)*

Values marked with * retrieved from S&P Global.

Segment performance

SegmentMetricQ3 2024Q2 2025Q3 2025
Crude TankersShipping Revenues ($M)103 104 96
TCE Revenues ($M)99 99 93
Product CarriersShipping Revenues ($M)122 92 100
TCE Revenues ($M)121 90 99

KPIs: Spot TCEs and revenue days (select highlights)

ClassKPIQ3 2024Q3 2025
VLCCAvg spot TCE ($/day)29,711 34,809
Revenue days (spot)881 627
SuezmaxAvg spot TCE ($/day)38,044 33,310
MRAvg spot TCE ($/day)29,006 25,556
LR1Avg spot TCE ($/day)46,899 34,578
TotalTotal revenue days (All)6,671 6,245

Notes: Adjusted net income/EBITDA exclude gains on vessel sales ($13.7M gain in Q3); see Non‑GAAP reconciliations .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Combined Dividend/ShareQ3 declared (paid Dec-23)$0.77 (Q2 declared, paid Sep-25) $0.86 (Q3 declared) Raised
Dividend Payout RatioOngoing≥75% of adjusted NI (Q2) 75% (5th consecutive qtr) Maintained
Spot Cash Break‑Even/DayFY2026~$13,100/day (prior view) ~$14,500/day Raised (timing/op ex)
Q4 Booked Spot TCEQ4 2025 (to‑date)N/A~$40,400/day; ~47% of expected days New datapoint
Time Charter BacklogAs of date~$261M (as of Jul 1, 2025) ~$229M (as of Oct 1, 2025) Lower (roll‑offs)
Share Repurchase Authorization ExpiryAuthorization2025 year-end Extended to end of 2026 Extended

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1–Q2 2025)Current Period (Q3 2025)Trend
Tanker demand and ratesExpect near-term oil demand growth; inventories below historical levels; regional imbalances supportive “Market conditions strengthened late Q3 and remain firm… fundamentals point to continued strength” Improving
Supply constraints/orderbookModest fleet growth; elevated recycling volumes supportive Aging fleet vs orderbook; sanctioned tonnage > orderbook; supportive multi‑year upcycle Supportive
Geopolitics/sanctionsUncertainty persists; supportive trade inefficiencies Russian/Iran barrels/sanctions creating inefficiencies; compliant fleet benefits in products Supportive
Capital allocation75% payout; fleet renewal underway (MR/VLCC swap) $250M bond to unencumber 6 VLCCs; 75% payout and dividend increase; new VLCC purchase Active/positive
Balance sheet/liquidityLiquidity $673M–$709M; RC reduction Liquidity ~$985M; net LTV ~13%; nearest maturity next decade Stronger
Cost structure/break-evenN/A2026 break-even ~$14.5k/day vs ~$13.1k prior; higher opex/drydock timing Slightly worse

Management Commentary

  • “Seaways delivered another strong quarter… We sold our oldest vessels, took delivery of two of six LR1 newbuildings, and completed a NOK bond transaction that will ultimately unencumber six vessels and enhance our financial flexibility.” – CEO Lois Zabrocky .
  • “The proceeds [of the bond] were used to retire higher-cost debt… Combined with our low cash break-even under $15,000 per day in 2026… this transaction further enhances our financial flexibility.” – CFO Jeff Pribor .
  • “We currently have a blended average spot TCE of about $40,400 per day… 47% of our fourth-quarter expected revenue days.” – CFO Jeff Pribor .
  • “We will continue to judiciously upgrade the fleet… In 2026, it’ll be more of the same of some disposals of the older vessels.” – CEO Lois Zabrocky .

Q&A Highlights

  • Rate transmission across classes: Strong VLCCs are “pulling” midsize crude (Suez/Afra) higher as Vs return to traditional trades, easing prior cannibalization; midsize attempting to backfill VLCC routes as rates firm – CCO Derek Solon .
  • MR/product dynamics: Healthy MRs aided by fewer Russian diesel exports (sanctions, infrastructure attacks) with replacement barrels from the U.S./LatAm that the compliant fleet can carry, supporting rates – CCO Derek Solon .
  • Inventories/storage: “A lot of oil on the water” but not heightened onshore inventories; forward curve “pretty flat,” not steep enough for storage; monitoring sanctions and producer data discrepancies – CEO Lois Zabrocky .
  • Fleet renewal pace: Continuing asset sales of older MRs and selective purchases (2020-built VLCC) with intent to “hydrate the fleet” and improve earnings capability – CEO Lois Zabrocky .

Estimates Context

  • Beats vs S&P Global: EPS $1.15 vs $0.94 (+$0.21); revenue $196.4M vs $186.2M (+$10.1M); adjusted EBITDA $106.2M vs $93.5M (+$12.7M). Forward Q4 2025 EPS consensus $1.77 and revenue $227.2M set a higher bar amid strong book‑to‑date TCEs (bold beat)* .
  • Estimate adjustments: Street likely to lift near-term EBITDA/EPS on stronger Q4 bookings and improved rate environment across crude and products; watch for 2026 cost lines given higher break‑even guidance .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Positive inflection into Q4: Booked spot TCE of ~$40.4k/day on ~47% of days implies a stronger revenue/EBITDA print next quarter if current conditions persist .
  • Capital returns remain robust: Combined dividend raised to $0.86/share with 75% payout preserved; authorization extended through 2026, signaling continued distributions supported by high cash generation .
  • Balance sheet leverage is low and improving: ~$985M liquidity, net LTV ~13%, unencumbering six VLCCs post-bond enhances flexibility for cycles and opportunistic S&P activity .
  • Fleet renewal accretive: Recycling older tonnage and adding a modern scrubber‑fitted VLCC should improve earnings quality and environmental profile across the cycle .
  • Watch costs and docking cadence: 2026 break-even lifted to ~$14.5k/day on higher opex/drydock timing—manageable but relevant for mid‑cycle profitability .
  • Macro tailwinds intact: OPEC+/Americas supply growth, low inventories, and geopolitical trade inefficiencies continue to support tanker TCEs; compliant fleet advantages in products markets persist .
  • Modeling note: Lightering contributed ~$9M revenue and ~+$1M EBITDA in Q3; segment outperformance (MRs) and class mix remain key P&L swing factors .

Additional Details and Source Cross-Checks

  • Q3 results: revenue $196.4M; TCE revenue $192.5M; net income $70.5M; diluted EPS $1.42; adjusted NI $56.9M ($1.15/share); adjusted EBITDA $107.7M .
  • Dividend actions and authorization: $0.86 combined dividend (Dec payment); $0.77 paid in Sep; repurchase program extended to end of 2026 .
  • Bond financing and debt actions: $250M 7.125% unsecured bonds to refinance sale‑leasebacks ($258M), reduce interest and eliminate ~$22M annual mandatory amortization; ECA facility draws $41M per LR1 delivery in Sep and Oct .
  • Fleet and charters: Delivery of two LR1 newbuilds; agreement to acquire 2020-built VLCC for $119M (Q4 delivery); five ships sold in Q3 (~$67M proceeds); 14 ships on TC with ~$229M backlog as of Oct 1 .

All non‑GAAP reconciliations and KPI definitions are provided in the company’s press release and 8‑K exhibits .