Value Investor's Edge Live #42: Tanker Market Updates From Euronav

Marketplace Roundtable

Hugo De Stoop, CEO of Euronav (EURN), a leading crude tanker company, joined J Mintzmyer's Value Investor's Edge Live on June 9, 2021, to discuss the crude tanker markets, recovery trajectory, and capital allocation priorities for Euronav. This interview and discussion is relevant for anyone with crude tanker or product tanker investments, including Ardmore Shipping (ASC), Diamond S Shipping (DSSI), DHT Holdings (DHT), Frontline (FRO), International Seaways (INSW), Navios Maritime Acquisition (NNA), Nordic American Tankers (NAT), Scorpio Tankers (STNG), Teekay Tankers (TNK), Tsakos Energy Navigation (TNP) and Torm (TRMD).
Although it may seem a bit dated since this interview was conducted about two months ago, very little has changed in the crude tanker markets since we last chatted, so the content should be useful for all investors interested in Euronav or the overall sector. It's worth noting that the emergence of the Delta variant has effectively pushed back the crude tanker recovery scenario by at least 2-3 months so far, so even though the big picture situation is similar, the turnaround timing has been pushed back a bit further.
Euronav is set to report Q2-21 results on Thursday, Aug. 12, with a conference call at 0800 EST. This interview should act as a useful primer before these results.
Topics Covered
(2:00) Current state of the crude tanker market? Past the bottom yet?
(5:00) Impact of Iran sanctions coming off soon?
(9:00) Any concerns about the current tanker orderbook?
(13:45) How do current environmental proposals impact EURN?
(19:45) Economics of investing in environmentally friendly upgrades?
(24:00) Are scrubber retrofits attractive here with larger spreads?
(25:45) Environmental impact from copper-oxide hull paints?
(27:30) Will 2023 EEXI impact EURN? Risks of divesting older ships?
(33:45) Any risk of exposure to future ‘green recycling’ requirements?
(36:30) What are Euronav’s current capital allocation priorities?
(41:30) Any plan to address adverse tax-withholding from dividends?
(44:45) Update on ULCC assets?
(47:00) Commentary on FSO JV? Any divestment potential?
(50:30) Why invest in EURN versus peers? Differentiation?
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