The year past was Ardmore Shipping’s most profitable since becoming a public company a decade ago, and the Irish product tanker owner closed it as expected with a strong fourth quarter that beat analyst estimates.
And while MR bookings in the current quarter are down about 10% sequentially with half of the days booked, they are still at strongly profitable numbers, according to its earnings report filed on Tuesday.
Ardmore reported adjusted net income of $54m, or $1.33 per share, flipping an adjusted loss of $8.6m, or $0.25 per share, for the last three months of 2021. The result beat consensus analyst estimates of $1.28 per share.
Revenue more than doubled to $132.8m from the $52.5m logged a year ago on the company's fleet of 27 MRs and chemical tankers.
“2022 was a tremendous year for product tanker markets and the most profitable year thus far for Ardmore, as supportive fundamentals created early momentum that was then amplified by a substantial re-ordering of global energy markets,” said Ardmore chief executive Anthony Gurnee in the report.
“This also followed a prolonged period of refined product inventory draws and post-pandemic energy consumption growth, and energy supply chains operating with little, if any, buffer to account for dislocations or unforeseen developments.”
Ardmore's MRs earned a time charter equivalent (TCE) rate of $43,174 per day in the last quarter, with its chemical carriers coming in at $28,544.
Those numbers dipped with the market in the current quarter, as Ardmore said MRs were at $39,500 per day with 55% of days booked, and chemical tankers at $27,750 with 70% fixed.
Ardmore was shipping's top-performing stock of 2022 with a 326% gain, and the owner has further rewarded investors by declaring a $0.45 per share dividend. Its new dividend policy pays out one-third of adjusted net income.
“In these tight and fast-changing markets, Ardmore’s high-quality fleet of modern MR product and chemical tankers, its focus on operational excellence and ability to take advantage of market volatility, along with a strong balance sheet and low breakeven levels, have enabled us to generate strong profits and cash flow,” Gurnee said.
“As a result, we are also now able to pursue our capital allocation policy priorities simultaneously: maintaining our fleet over time, continued de-levering of our balance sheet, paying our newly initiated quarterly dividend, and selectively evaluating accretive growth opportunities that support our long-term strategic goals.”
For the year Ardmore reported adjusted net income of $143.5m or $3.86 per share, its best performance since listing in New York in 2013.
