Marine transportation company Tsakos Energy Navigation Ltd. (TNP) reported Thursday a decline in fourth-quarter profit, reflecting higher expenses and the absence of a gain on vessel sale recorded last year.
The Athens, Greece-based company's quarterly net income declined to US$27.62 million or $0.74 per share from US$52.18 million or $1.36 per share in the previous year.
There were no sales of vessels in the fourth quarter of 2008 while in the fourth quarter last year, the company sold one aframax tanker realizing a capital gain of $30.8 million.
On average, eight analysts polled by Thomson Reuters expected the company to report earnings of $0.76 per share for the quarter. Analysts' estimates typically exclude special items.
Voyage revenues for the quarter grew 19% to US$156 million from US$130.89 million in the earlier year. The company attributed the growth in revenues to stronger freight rates as well as to the higher average number of vessels and slightly higher fleet utilization.
Net revenues, or voyage revenues net of commissions and voyage expenses, were $130.31 million compared to $109.68 million in the preceding year.
Street analysts estimated revenues of $129.66 million for the quarter.
Average Time Charter Equivalent or TCE rates rose to US$33,768 per day from $29,935 in the previous year. The company noted that the rate environment in the fourth quarter of 2008 was significantly better than the solid rates during the preceding year.
Total expenses increased to US$98.52 million from US$57.08 million in the year-ago quarter. Operating expenses per vessel per day increased to $9,662 from $8,542 in the earlier year. The increase was mainly due to increased insurance expense and increased repair costs incurred during the dry-docking of vessels.
For fiscal 2008, the company posted net income of US$202.93 million or US$5.33 per share, compared to net income of US$183.17 million or US$4.79 per share in the previous year.
Voyage revenues for the year increased to US$623.04 million from US$500.62 million in the prior year. Net revenues were US$516.98 million, compared to US$410.57 million a year ago.
For the full year, analysts expected earnings of $4.48 per share on revenues of $544.15 million.
According to the company, utilization of the fleet was 97.3%, in comparison with 96.6% in the prior year, due to slightly lower dry-docking activity in 2008.
"A key impact has been demand erosion for petroleum products with current forecasts suggesting that 2009 will experience the second consecutive annual decline in worldwide oil consumption," said John Stavropoulos, chairman of the Board.
Looking ahead, the company said it is well positioned to keep operating successfully despite market fluctuations. "For the remainder of 2009, 66% of available ship days are fixed while 42% of 2010 has already been covered," the company added.
In addition, the Board has declared the company's semi-annual dividend of $0.85 per share, to shareholders of record on April 24, 2009, payable on April 30.
TNP is currently trading at $15.76, up $0.16 or 1.03%, on a volume of 28 thousand shares.
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