Q3 2020 Pyxis Tankers Inc Earnings Call

Good day and welcome to the Pyxis tankers conference call to discuss the financial results for the third quarter of 2020 as a reminder for today's call is being recorded. Additionally, a live webcast of today's conference call on an accompanying presentation.

It's available on Pyxis tankers website, which is www dot pyxis tankers dot com host.

Hosting the call today is mr. <unk>, the net <unk>, Chairman and Chief Executive Officer of Pyxis type because I missed it hadn't really assets Chief financial Officer I.

I would like Tonight introduced Pyxis tankers, <unk>, Chief Executive Officer, Mr. di Valentis Pease go ahead sorry.

Good afternoon, everyone and thank you for joining our call for the same on for the dogs and Cats September focused on good trends.

First I hope you your family friends and colleagues on managing for the best for doing this pandemic.

Encouraged by the major announcement earlier this week about their results so for highly effective vaccine, which wouldn't be a blessing for on.

Secondly on before starting let me draw your attention to some important legally liquification since like to work on Mandeep, including up isn't based on today, which will include forward looking statements. Thank you.

Turning to slide for me.

Our recent results reflect the thing that's still for the say Oh, Yeah. This year Oh This price and then on the cool 2006 day thinks is built on.

Within the context of on ongoing challenging chartering environment as well on less significant operating and financial event.

In Q3 with the right the time charter equivalent revenue, so 4.4 million about 1.8 million on nowhere on the same period in 2019 I was we had fewer operating days prime on the considering the absence of one vessel and low right.

Well, the net losses for 1.9 million or nine cents per share for the three months ended September Thirtyth Twentytwenty book.

Higher than the same period in the prior year.

Our adjusted EBITDA for Q for they plan to claim did decline significantly point 6 million.

[laughter] tankers shopping environment during the third quarter was 20 Atlantic on thing is to expenses downward trend in shop, it's especially on the spot market.

However, our operating results for Q3, Twentytwenty prime money on reflected the stability on contribution from the South then thoughts on this for our medium range Amar brought the tankers.

The average daily time charter equivalent for RMR was 14005 on the $65 during Q3 slightly lower than the prior quarter.

I was on November 11, 68% a lot available days in the fourth quarter was trying to find their book to put on a modest at an average gross rate of 14600 and they picked on us.

At this point in the year, we usually see an improvement in charter rates due to seasonal increases demand for certain categories, such as heating fuel. Unfortunately due to the resurgence of COVID-19 on the subsequent look downs in many western countries market has remained on directionally.

Yes.

Consequently, we believe for that difficult. So I think on these since may persist in the short term however, with those people on the long term outlook for the product tanker sector, especially if they are having a big deal for an effective vaccine is on the horizon.

Based on slide four for.

For information on our fleet I'm confident employment activities.

I think you see the pyxis absent little completed their first special survey what's included things like some of the U.S. close gopros by less for the taking the system.

More recently, the north sea on fun, North sea, but not completed the SEC on special surveys and they tend to the spot market.

These dry dockings work on that on time and on budget.

We spent 1.6 million in drag on a game for this special surveys on at least let's say vessels. Fortunately, we should avoid major vessel expenditures on day.

Twentytwenty free you went to fix is set up for you.

He is scheduled for fun to go the second survey.

Following up on my earlier comments about the product tanker market. Please turn to slide six for an update.

[noise] COVID-19 has been for <unk>, but I'm not that clearly abuse personal and commercial activities worldwide. Starting I lived this past spring and resulted in a substantial decline in demand for per quarter.

On products, especially on the transportation fuels, such as diesel gasoline assets.

Despite the efforts to improve public safety for the prevention of call. It 19.

Since Oh, the virus has that recently occurred in many western countries.

Government on Central Bank stimulus programs that book to really now exceed nine team, bringing on dollar [laughter] by the global economic recovery may be further delayed.

Excess inventories over to find for that's on declining but lower demand for seaborne cargoes on to be double standards in the open market continued to negatively impact the chartering activity stuff.

Spot rates have fallen significantly with little inquiry for time softness for example, they they took the one good times out their day it for a need credit Csone Denmar has declined less severely the approximate.

For themed thousand $200 per day, which is slightly below the 10 year average.

Turning to slide seven.

The roads to club the global economic recovery should be bumpy, even with the possible suits whatever number you go for an effective vaccine in.

In October the IMF revised its focus for global economic growth and plan to Glenn Glenn <unk> robust 5.2%.

Got it on scenario of solid consumption combined with low inventories of refined petroleum products as well as modest on my luck sponsors on the changing refinery landscape should provide a that support for the product tanker sector.

Moving to slide eight.

On the supply outlook for them on tools for remain positive.

The book continues to decline and they simply living in this day source estimated that the book at 6.1 per cent out of a worldwide fleet of over 1700 60 vessels.

Well I live there's nobody number of them are scheduled for delivery for 2021, new ordering activity continues to be historically low.

On going to developments in shape and engine designs, expanding environmental regulations and put on.

On a selection of shoes unveiling getting debates on I don't think scrabble complicate the decision making process for non ordering by owners.

It is expected that them on nations should accelerate a 6.2% on a global fleet.

On that and a modest.

20 years or older, especially in light of the for market conditions on the financial headwinds facing older less efficient vessels for the newer invite on meant a little collections.

Lastly, the availability of cost effective capital on things to be Scott for.

Further on limiting yard there as an example, we believe.

Net fleet growth for a mass would be around 2.5 per cent this year and next.

Turning to slide nine.

The recent decline in spot day rates continue to negatively affect them on to asset prices would try to be low 10 year average.

With <unk> actually S&P activity, particularly for momentum equal MRC zone.

Notably last ones may prove to be another reaction, but at the same time could selectively leads to attractive opportunities to acquire secondhand tankers at lower prices on GAAP sort of potential upward movement of topics.

At this point I would like to turn the call over this anyway, and so to find US and officer, who will discuss our financing that is outs and good day that they day.

Thanks, Andy let's start with our unaudited results for the three months ended September 32020 on slide 11, our time trying to gross revenues for Q3, 20, which we define as revenues net mice voyage related costs and commissions were $4.4 million a decrease of 20.

9%.

The same period in 2019 do a few due to fewer operating days of our fleet.

Primarily reflecting the sale of the older MRV earlier this year.

Q3 20, our.

Our daily TC rate, we wire was almost $11800 a 5% decline from the comparable period in 2019.

Small tankers continue to negatively affect our results journey.

Turning to slide 12, we incurred a net loss of $1.9 million for the three months ended September Thirtyth 2028, or nine cents basic and diluted loss per share based on 21.6 million weighted average shares outstanding compared.

Compared to a lower net loss of $800000 or four cents basic and diluted loss per share.

On 400000 fewer shares.

Absence of the one EMR resulted in lower revenue, which flow through to the bottom line not surprising adjusted EBITDA declined significantly to $600000 in the most recent quarter.

Please turn to slide 13, which reviews, our recent week data by vessel type.

Given the size of our fleet changes in these metrics related to a single vessel and one reporting periods can have a disproportionate effect on the total fleet operating results.

Dan we no longer hold for the older standard Edmar.

Focusing on the periods ended September Thirtyth 2020, we would like to point out for key takeaways for the most.

As for recent quarter, the Tc for to go fishing, and one eco mod MRC averaged over $14500 per day.

[laughter] Q3, 2020 operating expenses for eco efficient MRC were temporarily higher reflecting the dry docking of the pyxis excellent but we.

We expect this to normalize in Q4 cash.

The board our Q3 2012 results for a small tankers were just book disappointing.

And overall, the nine month period share relative consistency weve wide daily Tc and vessel Opex versus 2019.

Turning to slide 14, as you know we believe it's important to review total daily operational costs to run and manage a public tanker company, including overhead.

These cost survived fleet composition vessel delivery on removal company operating structure and management.

We define total daily operational costs as vessel operating expenses technical and commercial management fees plus gn expenses.

We believe that the total daily operational cost of our modern eco efficient more two tankers continue to be very competitive.

Hey, or to our public peers, despite our smaller size.

Please turn to slide 15 to review our capitalization as of September 32020 at quarter close our consolidated leverage ratio was on par with some publicly traded tanker copies as net funded debt stood at less than 64% of total capitalization on the net proceeds of the force.

$3 million.

Public offering.

As improved our balance sheet and liquidity and on an adjusted basis net leverage stood at 56%.

No balloon payments are due for over two years.

I'd like to turn the call back over to Eddie to conclude our presentation.

Thanks Henry.

We expect revenue the remainder of Plenti planting will continue to be challenging with lower chartering activity that is out of the <unk> delayed the global economic recovery on value set them developments on the call that 19 on that mix. We continue to have a positive long term outlook given the expected net.

Vessel supply growth on the prospects for improving the month, especially in light of the benefits on the economic effect.

Vaccine potentially available on stopping us on another year end or early plan for 21.

We appreciate your interest in Pyxis tankers on thank you for joining our call today, we look forward to reporting on future progress pyxis tankers be safe B wells.

That does conclude our conference for today. Thank you for your participation you may all disconnect.

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