International Seaways (INSW) delivers $581M H1 2026 profit on tanker market surge
Rhea-AI Filing Summary
International Seaways, Inc. reported sharply stronger results for the quarter and six months ended June 30, 2026, driven by a surge in tanker market rates. Shipping revenues rose to $467.3 million for the quarter and $792.8 million year-to-date, with time charter equivalent revenues of $434.2 million and $751.4 million, respectively, more than double 2025 levels.
Net income increased to $294.9 million for the quarter and $581.1 million for the first half of 2026, compared with $61.6 million and $111.2 million a year earlier. Operating cash flow reached $408.7 million in the first half, supporting vessel sales gains of $88.1 million, significant dividends of $331.8 million, and continued investment in LR1 newbuilds and fleet renewal. Total assets grew to $3.02 billion, equity to $2.27 billion, and cash and short-term investments to $409.4 million, while long-term debt, including lease financings, increased to $645.6 million as the company drew on its ECA facility and added a Suezmax borrowing base facility.
Positive
- Net income jumped to $294.9M for Q2 and $581.1M for H1 2026, up more than fivefold from $61.6M and $111.2M a year earlier, reflecting much stronger tanker market conditions.
- Time charter equivalent revenues more than doubled to $434.2M for Q2 and $751.4M for H1 2026 versus $188.8M and $367.2M, indicating materially higher earning rates across both crude and product fleets.
- Operating cash flow of $408.7M in the first half of 2026, up from $155.7M, provided substantial liquidity to fund dividends, debt service, and vessel investments.
- The company realized $88.1M of gains on vessel sales and maintained a strong balance sheet with $409.4M in cash and short-term investments and $2.27B of equity.
Negative
- Cash dividends paid totaled $331.8M in the first half of 2026, a large cash outflow relative to $408.7M of operating cash flow that reduces retained earnings and financial flexibility.
Filing Explained
The filing records a completed pool acquisition, newbuild commitments, and rights mechanics—structural changes beyond the reported earnings and liquidity.
As an unaudited quarterly report, this Form 10-Q updates interim financial statements and liquidity, and records a completed pool acquisition alongside new vessel commitments. The acquisition changes which operations are consolidated, while the contracts create future capital requirements rather than completed vessel deliveries.
On
The company also established Tankers International Suezmax Limited, a consolidated variable-interest entity, because it held majority decision-making power over significant economic decisions; that assessment could change if additional third-party owners join the pool.
Agreements signed in May and July 2026 cover four additional LR1 vessels for approximately
For two earlier LR1 newbuild contracts,
The Second Amended and Restated Rights Agreement gives each right the entitlement to purchase one common share at
Key Figures
Key Terms
time charter equivalent revenues financial
variable interest entity financial
dual-fuel ready LNG technical
Emissions Trading System regulatory
goodwill impairment testing financial
borrowing base facility financial
Earnings Snapshot
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
For the quarterly period ended
OR
For the transition period from to
Commission File Number
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Registrant’s telephone number, including area code: |
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Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Accelerated filer ☐ | Emerging growth company | |
Non-accelerated filer ☐ | Smaller reporting company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practical date. The number of shares outstanding of the issuer’s common stock as of August 6, 2026: common stock, no par value,
INTERNATIONAL SEAWAYS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
DOLLARS IN THOUSANDS
(UNAUDITED)
June 30, 2026 | | December 31, 2025 | ||||
ASSETS | ||||||
Current Assets: | ||||||
Cash and cash equivalents | $ | | $ | | ||
Short-term investments | | | ||||
Voyage receivables, net of allowance for credit losses of $ | ||||||
including unbilled receivables of $ | | | ||||
Other receivables | | | ||||
Inventories | | | ||||
Prepaid expenses and other current assets | | | ||||
Total Current Assets | | | ||||
Vessels and other property, less accumulated depreciation of $ | | | ||||
Vessels construction in progress | | | ||||
Deferred drydock expenditures, net | | | ||||
Operating lease right-of-use assets | | | ||||
Pool working capital deposits | | | ||||
Goodwill | | | ||||
Other assets | | | ||||
Total Assets | $ | | $ | | ||
LIABILITIES AND EQUITY | ||||||
Current Liabilities: | ||||||
Accounts payable, accrued expenses and other current liabilities | $ | | $ | | ||
Current portion of operating lease liabilities | | | ||||
Current installments of long-term debt | | | ||||
Total Current Liabilities | | | ||||
Long-term operating lease liabilities | | | ||||
Long-term debt | | | ||||
Other liabilities | | | ||||
Total Liabilities | | | ||||
Commitments and contingencies | ||||||
Equity: | ||||||
Capital - | ||||||
shares issued and outstanding | | | ||||
Retained earnings | | | ||||
| | |||||
Accumulated other comprehensive loss | ( | ( | ||||
Total Equity | | | ||||
Total Liabilities and Equity | $ | | $ | | ||
See notes to condensed consolidated financial statements
1
INTERNATIONAL SEAWAYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS
(UNAUDITED)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||
Shipping Revenues: | ||||||||||||
Pool revenues, including $ | ||||||||||||
from affiliated companies | $ | | $ | | $ | | $ | | ||||
Time charter revenues | | | | | ||||||||
Voyage charter revenues | | | | | ||||||||
| | | | |||||||||
Other operating revenues | | | | — | ||||||||
Operating Expenses: | ||||||||||||
Voyage expenses | | | | | ||||||||
Vessel expenses | | | | | ||||||||
Charter hire expenses | | | | | ||||||||
Depreciation and amortization | | | | | ||||||||
General and administrative | | | | | ||||||||
Other operating expenses | | | | | ||||||||
Loss/(gain) on disposal of vessels and other assets, net | | ( | ( | ( | ||||||||
Total operating expenses | | | | | ||||||||
Income from vessel operations | | | | | ||||||||
Holding gain on previously held equity interest | | | | — | ||||||||
Operating income | | | | | ||||||||
Other income | | | | | ||||||||
Income before interest expense | | | | | ||||||||
Interest expense | ( | ( | ( | ( | ||||||||
Income before income taxes | | | | | ||||||||
Income tax benefit | | | | — | ||||||||
Net income | $ | | $ | | $ | | $ | | ||||
Weighted Average Number of Common Shares Outstanding: | ||||||||||||
Basic | | | | | ||||||||
Diluted | | | | | ||||||||
Per Share Amounts: | ||||||||||||
Basic net income per share | $ | | $ | | $ | | $ | | ||||
Diluted net income per share | $ | | $ | | $ | | $ | | ||||
See notes to condensed consolidated financial statements
2
INTERNATIONAL SEAWAYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
DOLLARS IN THOUSANDS
(UNAUDITED)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||
Net income | $ | | $ | | $ | | $ | | ||||
Other comprehensive loss, net of tax: | ||||||||||||
Net change in foreign currency translation | ( | | ( | | ||||||||
Net change in unrealized losses on cash flow hedges | ( | ( | ( | ( | ||||||||
Defined benefit pension and other postretirement benefit plans: | ||||||||||||
Net change in unrecognized prior service costs | | ( | | ( | ||||||||
Net change in unrecognized actuarial losses | | ( | | ( | ||||||||
Other comprehensive loss, net of tax | ( | ( | ( | ( | ||||||||
Comprehensive income | $ | | $ | | $ | | $ | | ||||
See notes to condensed consolidated financial statements
3
INTERNATIONAL SEAWAYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
DOLLARS IN THOUSANDS
(UNAUDITED)
Six Months Ended June 30, | ||||||
2026 | 2025 | |||||
Cash Flows from Operating Activities: | ||||||
Net income | $ | | $ | | ||
Items included in net income not affecting cash flows: | ||||||
Depreciation and amortization | | | ||||
Amortization of debt discount and other deferred financing costs | | | ||||
Stock compensation | | | ||||
Other – net | ( | | ||||
Items included in net income related to investing and financing activities: | ||||||
Gain on disposal of vessels and other assets, net | ( | ( | ||||
Holding gain on previously held equity interest | ( | | ||||
Payments for drydocking | ( | ( | ||||
Insurance claims proceeds related to vessel operations | | | ||||
Changes in operating assets and liabilities: | ||||||
(Increase)/decrease in voyage receivables | ( | | ||||
Decrease in deferred revenue | ( | ( | ||||
Net change in other receivables, inventories, prepaid expenses and other current assets, accounts | ||||||
payable, accrued expenses and other current and long-term liabilities | | ( | ||||
Net cash provided by operating activities | | | ||||
Cash Flows from Investing Activities: | ||||||
Expenditures for vessels, vessel improvements and vessels under construction | ( | ( | ||||
Security deposits returned for vessel exchange transactions | | | ||||
Proceeds from disposal of vessels and other property | | | ||||
Expenditures for other property | ( | ( | ||||
Cash consideration paid for the purchase of equity method investment, net of cash acquired | ( | | ||||
Investments in short-term time deposits | ( | | ||||
Proceeds from maturities of short-term time deposits | | | ||||
Pool working capital deposits | | ( | ||||
Net cash (used in)/provided by investing activities | ( | | ||||
Cash Flows from Financing Activities: | ||||||
Borrowings on nonrevolving credit facility debt | | | ||||
Repayments of nonrevolving credit facility debt | ( | | ||||
Borrowings on revolving credit facilities | | | ||||
Repayments on revolving credit facilities | ( | ( | ||||
Payments on sale and leaseback financing | ( | ( | ||||
Payments of deferred financing costs | ( | ( | ||||
Cash dividends paid | ( | ( | ||||
Cash paid to tax authority upon vesting or exercise of stock-based compensation | ( | ( | ||||
Net cash used in financing activities | ( | ( | ||||
Net increase/(decrease) in cash and cash equivalents | | ( | ||||
Cash and cash equivalents at beginning of year | | | ||||
Cash and cash equivalents at end of period | $ | | $ | | ||
See notes to condensed consolidated financial statements
4
INTERNATIONAL SEAWAYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
DOLLARS IN THOUSANDS
(UNAUDITED)
Accumulated | ||||||||||||
Other | ||||||||||||
Retained | Comprehensive | |||||||||||
Capital | Earnings | Loss | Total | |||||||||
For the six months ended | ||||||||||||
Balance at January 1, 2026 | $ | | $ | | $ | ( | $ | | ||||
Net income | | | | | ||||||||
Other comprehensive loss | | | ( | ( | ||||||||
Dividends | | ( | | ( | ||||||||
Common stock withheld related to net share settlement of equity awards | ( | | | ( | ||||||||
Compensation relating to restricted stock awards | | | | | ||||||||
Compensation relating to restricted stock units awards | | | | | ||||||||
Balance at June 30, 2026 | $ | | $ | | $ | ( | $ | | ||||
Balance at January 1, 2025 | $ | | $ | | $ | ( | $ | | ||||
Net income | | | | | ||||||||
Other comprehensive loss | | | ( | ( | ||||||||
Dividends | | ( | | ( | ||||||||
Common stock withheld related to net share settlement of equity awards | ( | | | ( | ||||||||
Compensation relating to restricted stock awards | | | | | ||||||||
Compensation relating to restricted stock units awards | | | | | ||||||||
Balance at June 30, 2025 | $ | | $ | | $ | ( | $ | | ||||
For the three months ended | ||||||||||||
Balance at April 1, 2026 | $ | | $ | | $ | ( | $ | | ||||
Net income | | | | | ||||||||
Other comprehensive loss | | | ( | ( | ||||||||
Dividends | | ( | | ( | ||||||||
Compensation relating to restricted stock awards | | | | | ||||||||
Compensation relating to restricted stock units awards | | | | | ||||||||
Balance at June 30, 2026 | $ | | $ | | $ | ( | $ | | ||||
Balance at April 1, 2025 | $ | | $ | | $ | ( | $ | | ||||
Net income | | | | | ||||||||
Other comprehensive loss | | | ( | ( | ||||||||
Dividends | | ( | | ( | ||||||||
Common stock withheld related to net share settlement of equity awards | ( | | | ( | ||||||||
Compensation relating to restricted stock units awards | | | | | ||||||||
Compensation relating to stock option awards | | | | | ||||||||
Balance at June 30, 2025 | $ | | $ | | $ | ( | $ | | ||||
See notes to condensed consolidated financial statements
5
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1 — Basis of Presentation:
The accompanying unaudited condensed consolidated financial statements include the accounts of International Seaways, Inc. (“INSW”), a Marshall Islands corporation, and its wholly-owned subsidiaries. Unless the context indicates otherwise, references to “INSW”, the “Company”, “we”, “us” or “our”, refer to International Seaways, Inc. and its subsidiaries. As of June 30, 2026, the Company’s operating fleet consisted of
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and notes required by generally accepted accounting principles in the United States. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results have been included. Operating results for the three months and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.
The condensed consolidated balance sheet as of December 31, 2025 has been derived from the audited financial statements at that date but does not include all of the information and notes required by generally accepted accounting principles in the United States for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
All intercompany balances and transactions within INSW have been eliminated.
Risks and Uncertainties
The unaudited condensed consolidated financial statements presented herein reflect estimates and assumptions made by management at June 30, 2026. These estimates and assumptions affect, among other things, the Company’s long-lived asset valuations; freight and other income tax contingencies; and the allowance for expected credit losses. Events and changes in circumstances arising after August 10, 2026, including those resulting from the impacts of macroeconomic volatility with respect to trade and tariffs, as well as the ongoing international conflicts, will be reflected in management’s estimates and assumptions for future periods.
Note 2 — Business Combinations
On January 27, 2026, the Company acquired all of the remaining outstanding capital stock of Tankers (UK) Agencies Limited (“TUKA”), a privately-held joint venture between the Company and CMB.Tech, which serves as the commercial manager for the VLCC pool company – Tankers International Limited (“TIL”). The total purchase consideration was $
The book value of the Company’s
6
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The acquisition date fair value of the purchase consideration paid and the allocation of the purchase consideration paid to identifiable tangible and intangible assets acquired and liabilities assumed based on their respective estimated fair values as of the date of acquisition was as follows:
(Dollars in thousands) | Amounts | ||
Cash paid | $ | | |
Fair value of previously held equity interest | | ||
Total Purchase Consideration | | ||
Fair value of identifiable assets acquired and liabilities assumed: | |||
Cash and cash equivalents | | ||
Other tangible assets | | ||
Other tangible liabilities | ( | ||
Total fair value of identifiable net assets acquired | | ||
Goodwill initially recognized(1)(2) | $ | |
______________
| (1) | Goodwill is primarily attributable to the assembled workforce of TUKA and brand recognition of TIL. |
| (2) | For segment reporting purposes, goodwill is included in the Crude Tankers reportable segment. |
The purchase price allocation and fair values of assets acquired, and liabilities assumed above are final.
Note 3 — Significant Accounting Policies:
For a description of all of the Company’s material accounting policies, see Note 2, “Summary of Significant Accounting Policies,” to the Company’s consolidated financial statements as of and for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K. The following is a summary of any changes or updates to the Company’s critical accounting policies for the current period:
Goodwill — Goodwill represents the excess purchase price over the fair value of identifiable tangible and intangible assets and liabilities acquired in connection with the Company’s acquisitions. We test goodwill for impairment annually or more frequently, whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit with goodwill below its carrying amount. The Company has selected November 30 as its annual goodwill impairment testing date. We have the option to first assess qualitative factors such as current performance and overall economic conditions to determine whether or not it is necessary to perform a quantitative goodwill impairment test. If we choose that option, then we would not be required to perform a quantitative goodwill impairment test unless we determine that, based on a qualitative assessment, it is more likely than not that the fair value of a reporting unit is less than its carrying value. If we determine that it is more likely than not that its fair value is less than its carrying value, or if we choose not to perform a qualitative assessment, we then proceed with the quantitative assessment. Under the quantitative test, if the fair value of a reporting unit exceeds its carrying amount, then goodwill of the reporting unit is considered to not be impaired. If the carrying amount of the reporting unit exceeds its fair value, then an impairment loss is recognized in an amount equal to such excess, up to the value of the goodwill. The reporting unit for goodwill impairment testing purposes is required to be the same as, or one level below an operating segment. Accordingly, the goodwill recognized in the acquisition of TUKA has been assigned to our VLCC operating segment, which is part of the Crude Tankers reportable segment.
7
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Foreign currency remeasurement and translation — The reporting currency of the Company is the U.S. dollar. The functional currency of the Company’s foreign subsidiaries is primarily the U.S. dollar. Monetary assets and liabilities denominated in currencies other than the functional currency are remeasured to the functional currency at period-end exchange rates. Foreign currency transaction gains and losses resulting from remeasurement are recognized in general and administrative expense in the condensed consolidated statements of operations and are not material for any of the periods presented.
For those subsidiaries with non-U.S. dollar functional currencies, assets and liabilities are translated into U.S. dollars at period-end exchange rates. Revenue and expenses are translated at the average exchange rates during the period. Equity transactions are translated using historical exchange rates. The resulting translation adjustments are recorded in accumulated other comprehensive loss in the condensed consolidated balance sheets.
Recently Adopted Accounting Pronouncements — There have been no recently adopted accounting pronouncements since the filing of our Annual Report on Form 10-K for the year ended December 31, 2025 that may have a material impact on our condensed consolidated financial statements.
New Accounting Pronouncements Not Yet Effective — The Financial Accounting Standards Board (“FASB”) Accounting Standards Codification is the sole source of authoritative GAAP other than United States Securities and Exchange Commission (“SEC”) issued rules and regulations that apply only to SEC registrants. The FASB issues Accounting Standards Updates (“ASU”) to communicate changes to the codification.
In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses. This guidance will require additional disclosures and disaggregation of certain costs and expenses presented on the face of the income statement. The amendments are effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027 with early adoption permitted. We are currently evaluating the impact of this new guidance on the disclosures to our consolidated financial statements.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal - Use Software (ASC 350-40): Targeted Improvements to the Accounting for Internal - Use Software. This new guidance is intended to eliminate the use of project stages and introduces a principles-based framework for recognizing and capitalizing internal-use software costs. The ASU is effective for annual periods beginning after December 15, 2027, including interim periods within those annual periods. Early adoption is permitted. We are evaluating the impact of the new guidance on our consolidated financial statements and related disclosures.
In November 2025, the FASB issued ASU No. 2025-09, Derivatives and Hedging (ASC 815): Hedge Accounting Improvements, which amends certain aspects of the hedge accounting guidance to more closely align hedge accounting with the economics of an entity’s risk management activities. This new guidance is intended to enable entities to achieve and maintain hedge accounting for a broader population of highly effective economic hedges while reducing cost and complexity. This ASU is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods within those annual periods. Early adoption is permitted. The amendments require adoption on a prospective basis. We are currently evaluating the new guidance but do not expect it to have a significant impact on our consolidated financial statements and related disclosures.
In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (ASC 818), which is intended to improve the accounting for and disclosure of environmental credits and related obligations and reduce diversity in practice. The amendments establish recognition, measurement, presentation, and disclosure requirements for environmental credits and environmental credit obligations arising from regulatory compliance programs. Environmental credits are recognized as assets when it is probable they will be used to settle an obligation, transferred in an exchange transaction, or used in a nonreciprocal transfer, and are subsequently measured based on their intended use. Environmental credit obligations are recognized as liabilities as qualifying events occur and are measured based on the carrying amount of related credits held and the amount required to settle any shortfall. The amendments are effective for public business entities for annual reporting periods beginning after December 15, 2027, and interim
8
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period with the amendments to be applied on a retrospective basis through a cumulative-effect adjustment to retained earnings. We are currently evaluating this new standard, but do not expect it to have a significant impact on our consolidated financial statements and related disclosures.
Note 4 — Earnings per Common Share:
Basic earnings per common share is computed by dividing earnings, after the deduction of dividends and undistributed earnings allocated to participating securities, by the weighted average number of common shares outstanding during the period.
The computation of diluted earnings per share assumes the issuance of common stock for all potentially dilutive stock options and restricted stock units not classified as participating securities. Participating securities are included in the computation of earnings per share pursuant to the two-class method.
Weighted average shares of unvested restricted common stock considered to be participating securities totaled
Reconciliations of the numerator and denominator of the basic and diluted earnings per share computations are as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Numerator: | ||||||||||||
Net income allocated to: | ||||||||||||
Common stockholders | $ | | $ | | $ | | $ | | ||||
Participating securities | | | | | ||||||||
$ | | $ | | $ | | $ | | |||||
Denominator: | ||||||||||||
Weighted-average common shares outstanding, basic | | | | | ||||||||
Dilutive effect of stock options | | | | | ||||||||
Dilutive effect of performance-based restricted stock units | | | | | ||||||||
Dilutive effect of restricted stock units | | | | | ||||||||
Weighted-average common shares outstanding, diluted | | | | | ||||||||
There were
Note 5 — Business and Segment Reporting:
The Company has
9
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Information about the Company’s reportable segments as of and for the three and six months ended June 30, 2026 and 2025 follows:
Crude | Product | ||||||||
(Dollars in thousands) | Tankers | Carriers | Totals | ||||||
Three months ended June 30, 2026: | |||||||||
Shipping revenues | $ | | $ | | $ | | |||
Time charter equivalent revenues | | | | ||||||
Vessel expenses | | | | ||||||
Charter hire expenses | | | | ||||||
Depreciation and amortization | | | | ||||||
Loss on disposal of vessels and other assets, net | | | | ||||||
Adjusted income from vessel operations | | | | ||||||
Adjusted total assets at June 30, 2026 | | | | ||||||
Three months ended June 30, 2025: | |||||||||
Shipping revenues | $ | | $ | | $ | | |||
Time charter equivalent revenues | | | | ||||||
Vessel expenses | | | | ||||||
Charter hire expenses | | | | ||||||
Depreciation and amortization | | | | ||||||
Loss/(gain) on disposal of vessels and other assets, net | | ( | ( | ||||||
Adjusted income from vessel operations | | | | ||||||
Adjusted total assets at June 30, 2025 | | | | ||||||
Crude | Product | ||||||||
(Dollars in thousands) | Tankers | Carriers | Totals | ||||||
Six months ended June 30, 2026: | |||||||||
Shipping revenues | $ | | $ | | $ | | |||
Time charter equivalent revenues | | | | ||||||
Vessel expenses | | | | ||||||
Charter hire expenses | | | | ||||||
Depreciation and amortization | | | | ||||||
Gain on disposal of vessels and other assets, net | ( | ( | ( | ||||||
Adjusted income from vessel operations | | | | ||||||
Adjusted total assets at June 30, 2026 | | | | ||||||
Expenditures for vessels and vessel improvements | | | | ||||||
Payments for drydocking | | | | ||||||
Six months ended June 30, 2025: | |||||||||
Shipping revenues | $ | | $ | | $ | | |||
Time charter equivalent revenues | | | | ||||||
Vessel expenses | | | | ||||||
Charter hire expenses | | | | ||||||
Depreciation and amortization | | | | ||||||
Gain on disposal of vessels and other assets, net | ( | ( | ( | ||||||
Adjusted income from vessel operations | | | | ||||||
Expenditures for vessels and vessel improvements | | | | ||||||
Payments for drydocking | | | | ||||||
10
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Reconciliations of time charter equivalent (“TCE”) revenues of the segments to shipping revenues as reported in the condensed statements of operations follow:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Shipping revenues | $ | | $ | | $ | | $ | | ||||
Less: Voyage expenses | ( | ( | ( | ( | ||||||||
Time charter equivalent revenues | $ | | $ | | $ | | $ | | ||||
Consistent with general practice in the shipping industry, the Company uses time charter equivalent revenues, which represent shipping revenues less voyage expenses, as a measure to compare revenue generated from a voyage charter to revenue generated from a time charter. Time charter equivalent revenues, a non-GAAP measure, provide additional meaningful information in conjunction with shipping revenues, the most directly comparable GAAP measure, because it assists Company management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance.
Reconciliations of total adjusted income from vessel operations of the segments to income before income taxes, as reported in the condensed consolidated statements of operations follow:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Total adjusted income from vessel operations of all segments | $ | | $ | | $ | | $ | | ||||
Other operating revenues | | | | | ||||||||
General and administrative expenses | ( | ( | ( | ( | ||||||||
Other operating expenses | ( | ( | ( | ( | ||||||||
(Loss)/gain on disposal of vessels and other assets, net | ( | | | | ||||||||
Consolidated income from vessel operations | | | | | ||||||||
Holding gain on previously held equity interest | | | | | ||||||||
Other income | | | | | ||||||||
Interest expense | ( | ( | ( | ( | ||||||||
Income before income taxes | $ | | $ | | $ | | $ | | ||||
Reconciliations of total assets of the segments to amounts included in the condensed consolidated balance sheets follow:
(Dollars in thousands) | June 30, 2026 | June 30, 2025 | ||||
Adjusted total assets of all segments | $ | | $ | | ||
Corporate unrestricted cash and cash equivalents | | | ||||
Short-term investments | | | ||||
Other unallocated amounts | | | ||||
Consolidated total assets | $ | | $ | | ||
Note 6 — Vessels:
Vessel Acquisitions and Construction Commitments
Between August 2023 and March 2024, the Company entered into agreements to construct
11
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The remaining commitments on the contracts for the construction of the
In May and July 2026, the Company entered into agreements to construct an additional
Disposal/Sales of Vessels
During the six months ended June 30, 2026, the Company sold
Note 7 — Goodwill:
As described above in Note 2, “Business Combinations,” on January 27, 2026, the Company acquired CMB.Tech’s
The changes in goodwill during the six months ended June 30, 2026 were as follows:
(Dollars in thousands) | Amounts | ||
Balance at December 31, 2025 | $ | — | |
Acquisition of TUKA | | ||
Foreign currency translation adjustment | ( | ||
Balance at June 30, 2026 | $ | |
Note 8 — Variable Interest Entities (“VIEs”):
Consolidated VIEs
The Company consolidates VIEs in which it holds a variable interest and is the primary beneficiary. On January 27, 2026, in conjunction with the acquisition of TUKA (see Note 2, “Business Combinations”), the Company established Tankers International Suezmax Ltd. (“TISL”), a tanker pool for the commercial management of the Company’s and other third-party owners’ Suezmaxes. TISL was determined to be a VIE. The formation agreements for TISL state that a board of pool participants has decision making power over the significant economic decisions that impact the pool. Although there was one other pool participant during the six months ended June 30, 2026, the Company controlled the majority of the decision making power and accordingly was considered to be the primary beneficiary of TISL. As such, the balance sheets and results of operations of TISL are included in the Company’s condensed consolidated financial statements as of and for the three and six months ended June 30, 2026. This assessment will change if additional third-party owners join the pool and the Company is deemed to no longer hold the majority of the decision making power over the significant economic decisions that impact the pool.
As of June 30, 2026, TISL’s total current assets and total current liabilities, after intercompany eliminations, were $
12
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Unconsolidated VIEs
As of June 30, 2026,
The following table presents the carrying amounts of assets and liabilities in the condensed consolidated balance sheet related to the unconsolidated VIEs as of June 30, 2026:
(Dollars in thousands) | |||
Pool working capital deposits | $ | | |
In accordance with accounting guidance, the Company evaluated its maximum exposure to loss related to these unconsolidated VIEs by assuming a complete loss of the Company’s investment in these VIEs. The table below compares the Company’s liability in the condensed consolidated balance sheet to the maximum exposure to loss at June 30, 2026:
(Dollars in thousands) | Maximum Exposure to | |||||
Other Liabilities | $ | – | $ | | ||
In addition, as of June 30, 2026, the Company had $
Note 9 — Fair Value of Financial Instruments, Derivatives and Fair Value Disclosures:
The estimated fair values of the Company’s financial instruments, other than derivatives that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows:
(Dollars in thousands) | June 30, 2026 | December 31, 2025 | Fair Value Level | ||||||
Cash and cash equivalents | $ | | $ | | Level 1 | ||||
Short-term investments | | | Level 1 | ||||||
2030 Bonds | ( | ( | Level 1 | ||||||
ECA Credit Facility(1) | ( | ( | Level 2 | ||||||
TISL Borrowing Base Facility(1) | ( | — | Level 2 | ||||||
BoComm Lease Financing (2) | ( | ( | Level 2 | ||||||
Toshin Lease Financing (2) | ( | ( | Level 2 | ||||||
Hyuga Lease Financing (2) | ( | ( | Level 2 | ||||||
Kaiyo Lease Financing (2) | ( | ( | Level 2 | ||||||
Kaisha Lease Financing (2) | ( | ( | Level 2 | ||||||
| (1) | Floating rate debt – the fair value of floating rate debt has been determined using level 2 inputs and is considered to be equal to the carrying value since it bears a variable interest rate, which is reset every three or six months (the Company’s current reset election is three months). |
| (2) | Fixed rate debt – the fair value of fixed rate debt has been determined using level 2 inputs by discounting the expected cash flows of the outstanding debt. |
13
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following table summarizes the fair values of net assets acquired in business combinations during the six months ended June 30, 2026:
(Dollars in thousands) | Fair Value | Level 1 | Level 2 | ||||||
Previously held equity interest(1) | $ | | $ | — | $ | | |||
Identifiable net assets acquired in business combination(2) | | | |
(1) The fair value attributed to the previously held equity interest was derived from the consideration transferred in the transaction
(2) Identifiable net assets acquired primarily consisted of working capital, including $
Note 10 — Debt:
Debt consists of the following:
(Dollars in thousands) | June 30, 2026 | | December 31, 2025 | |||
TISL Borrowing Base Facility | $ | | $ | | ||
ECA Credit Facility, due 2038, net of unamortized deferred finance costs of $ | | | ||||
2030 Bonds, due 2030, net of unamortized deferred finance costs of $ | | | ||||
BoComm Lease Financing, due 2030, net of unamortized deferred finance costs of $ | | | ||||
Toshin Lease Financing, due 2031, net of unamortized deferred finance costs of $ | | | ||||
Hyuga Lease Financing, due 2031, net of unamortized deferred finance costs of $ | | | ||||
Kaiyo Lease Financing, due 2030, net of unamortized deferred finance costs of $ | | | ||||
Kaisha Lease Financing, due 2030, net of unamortized deferred finance costs of $ | | | ||||
| | |||||
Less current portion | ( | ( | ||||
Long-term portion | $ | | $ | | ||
Capitalized terms used hereafter have the meaning given in these condensed consolidated financial statements or in the respective transaction documents referred to below, including subsequent amendments thereto.
ECA Credit Facility
During the six months ended June 30, 2026, the Company borrowed a total of $
TISL Borrowing Base Facility
In May 2026, TISL, a consolidated variable interest entity (see Note 8), entered into a $
14
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Facility as of June 30, 2026 is repayable on demand and is therefore included in current installments of long-term debt in the condensed consolidated balance sheet.
Debt Covenants
Deferred finance charges
Finance charges incurred in the arrangement of new debt and/or amendments resulting in the modification of existing debt are deferred and amortized to interest expense on either an effective interest method or straight-line basis over the term of the related debt. Unamortized deferred finance charges of $
Interest Expense
Total interest expense before the impact of capitalized interest, including amortization of deferred financing costs, commitment, administrative and other fees for all of the Company’s debt facilities for the three and six months ended June 30, 2026 was $
Interest capitalized to vessels under construction during the three and six months ended June 30, 2026 totaled $
Note 11 — Capital Stock and Stock Compensation:
Share Repurchase Program
Shares of Common Stock
The following table shows the changes in shares of common stock outstanding:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||
Common stock outstanding at beginning | | | | | ||||||||
Restricted common stock issued - non-executive directors | | | | | ||||||||
Common stock issued - vesting or exercise of share-based compensation | - | | | | ||||||||
Common stock withheld for employee taxes(1) | - | ( | ( | ( | ||||||||
Common stock outstanding at ending | | | | | ||||||||
15
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
| (1) | In connection with the settlement of vested restricted stock units and the exercise of stock options, the Company repurchased |
Director Compensation – Restricted Common Stock
In June 2026, the Company awarded a total of
Management Compensation
Stock Options
There were
Restricted Stock Units
During the six months ended June 30, 2026, the Company granted
During the six months ended June 30, 2026, the Company also granted
Rights Agreement
On April 6, 2026, the Board approved and authorized management to enter into, on April 9, 2026, the Second Amended and Restated Rights Agreement (the “Second A&R Rights Agreement”) between the Company and Computershare Trust Company, N.A., as rights agent, which amended and restated the Amended and Restated Rights Agreement with Computershare Trust Company, N.A., as rights
16
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
agent (the “A&R Rights Agreement”) in its entirety. Each Right entitles the registered holder to purchase from the Company
In general terms, the Second A&R Rights Agreement implements the same features and protective measures of the A&R Rights Agreement (except as noted below) and includes the following revised provisions:
| i. | extends the “Final Expiration Date” from April 10, 2026 to April 8, 2029; and |
| ii. | increases the Purchase Price from $ |
The Second A&R Rights Agreement otherwise preserves the terms of the prior A&R Rights Agreement. In particular, the Second A&R Rights Agreement does not change:
| i. | the existing |
| ii. | the existing qualifying offer provision and the related stockholder redemption feature. |
The Company’s Board of Directors adopted the Second A&R Rights Agreement and prior versions of the Rights Agreement to enable all stockholders of the Company to realize the full potential value of their investment in the Company. The Second A&R Rights Agreement is designed to prevent any individual stockholder or group of stockholders from gaining control of the Company through open market accumulation without paying a control premium to all stockholders or by otherwise disadvantaging other stockholders. The Second A&R Rights Agreement is not intended to prevent a takeover or deter fair offers for securities of the Company that deliver value to all stockholders on an equal basis. It is designed, instead, to encourage anyone seeking to acquire the Company to negotiate with the Board prior to attempting a takeover.
The Company’s Board of Directors may consider an earlier termination of the Second A&R Rights Agreement if market and other conditions warrant.
Dividends
During 2026, the Company’s Board of Directors declared and paid the following dividends:
Declaration Date | Record Date | Payment Date | Total Dividends per Share | Total Dividends Paid (Dollars in Thousands) | ||||
$ | $ | |||||||
$ | $ |
On
Note 12 — Accumulated Other Comprehensive Loss:
The components of accumulated other comprehensive loss, net of related taxes, in the condensed consolidated balance sheets follow:
(Dollars in thousands) | June 30, 2026 | | December 31, 2025 | |||
Unrealized gains on derivative instruments | $ | | $ | | ||
Items not yet recognized as a component of net periodic benefit cost (pension plans) | ( | ( | ||||
Foreign currency translation adjustment | ( | — | ||||
| $ | ( | $ | ( | ||
17
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The changes in the balances of each component of accumulated other comprehensive loss, net of related taxes, during the three and six months ended June 30, 2026 and 2025 follow:
(Dollars in thousands) | Unrealized gains on cash flow hedges | Items not yet recognized as a component of net periodic benefit cost | Foreign currency translation adjustment | Total | ||||||||
Balance as of March 31, 2026 | $ | | $ | ( | $ | ( | $ | ( | ||||
Current period change, excluding amounts reclassified | ||||||||||||
from accumulated other comprehensive loss | | — | ( | | ||||||||
Amounts reclassified from accumulated other comprehensive loss | ( | | — | ( | ||||||||
Balance as of June 30, 2026 | $ | | $ | ( | $ | ( | $ | ( | ||||
Balance as of March 31, 2025 | $ | | $ | ( | $ | — | $ | ( | ||||
Current period change, excluding amounts reclassified | ||||||||||||
from accumulated other comprehensive loss | | ( | — | ( | ||||||||
Amounts reclassified from accumulated other comprehensive loss | ( | | — | ( | ||||||||
Balance as of June 30, 2025 | $ | | $ | ( | $ | — | $ | ( | ||||
(Dollars in thousands) | Unrealized losses on cash flow hedges | Items not yet recognized as a component of net periodic benefit cost | Foreign currency translation adjustment | Total | ||||||||
Balance as of December 31, 2025 | $ | | $ | ( | $ | — | $ | ( | ||||
Current period change, excluding amounts reclassified | ||||||||||||
from accumulated other comprehensive loss | | ( | ( | ( | ||||||||
Amounts reclassified from accumulated other comprehensive loss | ( | | — | ( | ||||||||
Balance as of June 30, 2026 | $ | | $ | ( | $ | ( | $ | ( | ||||
Balance as of December 31, 2024 | $ | | $ | ( | $ | — | $ | ( | ||||
Current period change, excluding amounts reclassified | ||||||||||||
from accumulated other comprehensive loss | ( | ( | — | ( | ||||||||
Amounts reclassified from accumulated other comprehensive loss | ( | | — | ( | ||||||||
Balance as of June 30, 2025 | $ | | $ | ( | $ | — | $ | ( | ||||
Amounts reclassified out of each component of accumulated other comprehensive loss follow:
18
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | Statement of Operations | |||||||||
Reclassifications of gains on cash flow hedges: | ||||||||||||||
Interest rate swaps entered into by the Company's subsidiaries | $ | ( | $ | ( | $ | ( | $ | ( | Interest expense | |||||
Reclassifications of losses on discontinued hedging instruments: | ||||||||||||||
Interest rate swap entered into by the Company's subsidiaries | ( | ( | ( | ( | Interest expense | |||||||||
Items not yet recognized as a component of net periodic benefit cost | ||||||||||||||
(pension plans): | ||||||||||||||
Net periodic benefit costs associated with pension | ||||||||||||||
and postretirement benefit plans | | | | | Other income | |||||||||
Total before and net of tax | $ | ( | $ | ( | $ | ( | $ | ( | ||||||
At June 30, 2026, the Company expects that it will reclassify $
Note 13 — Shipping Revenue and Other Operating Revenues:
Revenue Recognition
The majority of the Company’s contracts for pool revenues, time charter revenues, and voyage charter revenues are accounted for as lease revenue under ASC 842. The Company’s contracts with pools are short term which are cancellable with up to
Lightering services provided by the Company’s Crude Tanker Lightering Business, voyage charter contracts that do not meet the definition of a lease, and commercial management services rendered to vessel owners participating in the VLCC and Suezmax tanker pools, (TIL and TISL), respectively, are accounted for as service revenues under ASC 606. In accordance with ASC 606, revenue is recognized when a customer obtains control of or consumes promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services.
19
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following tables present the Company’s revenues from leases accounted for under ASC 842 and revenues from services accounted for under ASC 606 for the three and six months ended June 30, 2026 and 2025:
Crude | Product | ||||||||
(Dollars in thousands) | Tankers | Carriers | Totals | ||||||
Three months ended June 30, 2026: | |||||||||
Revenues from leases | |||||||||
$ | | $ | | $ | | ||||
| | | |||||||
Voyage charter revenues from non-variable lease payments(1) | | | | ||||||
Voyage charter revenues from variable lease payments(1) | | — | | ||||||
Revenues from services | |||||||||
Voyage charter revenues from lightering services | | — | | ||||||
Total shipping revenues | $ | | $ | | $ | | |||
Other operating revenues | $ | | $ | — | $ | | |||
Three months ended June 30, 2025: | |||||||||
Revenues from leases | |||||||||
$ | | $ | | $ | | ||||
| | | |||||||
Voyage charter revenues from non-variable lease payments | ( | | | ||||||
Revenues from services | |||||||||
Voyage charter revenues from lightering services | | — | | ||||||
Total shipping revenues | $ | | $ | | $ | | |||
Crude | Product | ||||||||
(Dollars in thousands) | Tankers | Carriers | Totals | ||||||
Six months ended June 30, 2026: | |||||||||
Revenues from leases | |||||||||
$ | | $ | | $ | | ||||
| | | |||||||
Voyage charter revenues from non-variable lease payments(1) | | | | ||||||
Voyage charter revenues from variable lease payments(1) | | — | | ||||||
Revenues from services | |||||||||
Voyage charter revenues from lightering services | | — | | ||||||
Total shipping revenues | $ | | $ | | $ | | |||
Other operating revenues | $ | | $ | — | $ | | |||
Six months ended June 30, 2025: | |||||||||
Revenues from leases | |||||||||
$ | | $ | | $ | | ||||
| | | |||||||
Voyage charter revenues from non-variable lease payments | | | | ||||||
Revenues from services | |||||||||
Voyage charter revenues from lightering services | | — | | ||||||
Total shipping revenues | $ | | $ | | $ | | |||
_____________________________
20
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
| (1) | Voyage charter revenues from non-variable and variable lease payments include voyage charter revenues of TISL. |
Contract Balances
The following table provides information about receivables, contract assets and contract liabilities from contracts with customers, and significant changes in contract assets and liabilities balances, associated with revenue from services accounted for under ASC 606. Balances related to revenues from leases accounted for under ASC 842 are excluded from the table below.
(Dollars in thousands) | Voyage receivables - Billed receivables | Contract assets (Unbilled voyage receivables) | Contract assets (Unbilled Commercial Management Fees) | Contract liabilities (Deferred revenues and off hires) | ||||||||
Opening balance as of January 1, 2026 | $ | | $ | | $ | | $ | | ||||
Closing balance as of June 30, 2026 | | | | | ||||||||
We receive payments from customers based on the schedule established in our contracts. Contract assets relate to our conditional right to consideration for our completed performance obligations under contracts and decrease when the right to consideration becomes unconditional or payments are received. Contract liabilities include payments received in advance of performance under contracts and are recognized when performance under the respective contract has been completed. Deferred revenues allocated to unsatisfied performance obligations will be recognized over time as the services are performed.
Performance Obligations
All of the Company’s performance obligations are generally transferred to customers over time. The expected duration of services is less than one year. There were no material adjustments in revenues from performance obligations satisfied in previous periods recognized during the three and six months ended June 30, 2026 and 2025, respectively.
Costs to Obtain or Fulfill a Contract
As of June 30, 2026, there were
European Union’s Emissions Trading System
The European Union’s Emissions Trading System (“EU ETS”) emissions allowances (“EUA”) are valued based upon a market approach utilizing prices published on an EUA market index. The value of the EUAs to be provided to the Company pursuant to the terms of its agreements with the charterers of its vessels and the commercial pools in which it participates is included in shipping revenues in the condensed consolidated statements of operations. The value of the EUA obligations incurred by the Company under the EU ETS while its vessels are on-hire is included in voyage expenses, or in vessel expenses while its vessels are off-hire, in the condensed consolidated statements of operations.
Any EUAs held by the Company are intended to be used to settle its EUA obligations and are accounted for as intangible assets. As of June 30, 2026, the value of EUAs held by the Company that are required to be surrendered to the EU authorities in September 2026 is approximately $
21
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following table presents the components of the non-cash revenues and expenses recognized for EUAs earned and incurred during the three and six months ended June 30, 2026 and 2025:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Pool revenues | $ | | $ | | $ | | $ | | ||||
Time charter revenues | | | | | ||||||||
Voyage charter revenues | | — | | — | ||||||||
Total shipping revenues | $ | | $ | | $ | | $ | | ||||
Voyage expenses | $ | | $ | | $ | | $ | | ||||
The value of EUAs due to the Company from its charterers or commercial pools in which it participates is $
Note 14 — Leases:
As permitted under ASC 842, the Company has elected not to apply the provisions of ASC 842 to short term leases, which include: (i) tanker vessels chartered-in where the duration of the charter was one year or less at inception; (ii) workboats employed in the Crude Tankers Lightering business which have a lease term of 12-months or less; and (iii) short term leases of office and other space.
Contracts under which the Company is a Lessee
The Company currently has
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Operating lease cost | ||||||||||||
Vessel assets | ||||||||||||
Charter hire expenses | $ | | $ | | $ | | $ | | ||||
Office space and vessel equipment | ||||||||||||
General and administrative | | | | | ||||||||
Voyage expenses | | | | | ||||||||
Vessel expenses | | | | | ||||||||
Short-term lease cost | ||||||||||||
Vessel assets (1) | ||||||||||||
Charter hire expenses | | | | | ||||||||
Total lease cost | $ | | $ | | $ | | $ | | ||||
| (1) | Excludes vessels spot chartered-in under operating leases and employed in the Crude Tankers Lightering business for periods of less than |
22
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Supplemental cash flow information related to leases was as follows:
Six Months Ended June 30, | ||||||
(Dollars in thousands) | 2026 | 2025 | ||||
Cash paid for amounts included in the measurement of lease liabilities | ||||||
Operating cash flows used for operating leases | $ | | $ | | ||
Supplemental balance sheet information related to leases was as follows:
(Dollars in thousands) | June 30, 2026 | December 31, 2025 | ||||
Operating lease right-of-use assets | $ | | $ | | ||
Current portion of operating lease liabilities | $ | ( | $ | ( | ||
Long-term operating lease liabilities | ( | ( | ||||
Total operating and finance lease liabilities | $ | ( | $ | ( | ||
Weighted average remaining lease term - operating leases | ||||||
Weighted average discount rate - operating leases | ||||||
Office space and vessel equipment:
The Company has operating leases for offices, a lightering workboat dock space, and hull cleaning robots. These leases have expiry dates ranging from November 2026 to May 2033.
Payments of lease liabilities for office space and vessel equipment as of June 30, 2026 are as follows:
(Dollars in thousands) | Amount | ||
2026 | $ | | |
2027 | | ||
2028 | | ||
2029 | | ||
2030 | | ||
Thereafter | | ||
Total lease payments | | ||
less imputed interest | ( | ||
Total operating lease liabilities | $ | |
Contracts under which the Company is a Lessor
See Note 13, “Shipping Revenue and Other Operating Revenues,” for discussion on the Company’s revenues from operating leases accounted for under ASC 842.
23
INTERNATIONAL SEAWAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The future minimum contracted revenues, before the deduction of brokerage commissions, expected to be received on non-cancelable time charters for
(Dollars in thousands) | Amount | Revenue Days | |||
2026 | $ | | |||
2027 | | ||||
2028 | | ||||
2029 | | ||||
2030 | | ||||
Future minimum revenues | $ | | |||
Future minimum contracted revenues do not include the Company’s share of time charters entered into by the pools in which it participates or profit-sharing above the base rate on the newbuild dual-fuel LNG VLCCs. Revenues from a time charter are not generally received when a vessel is off-hire, including time required for normal periodic maintenance of the vessel. In arriving at the minimum future charter revenues, an estimated time off-hire to perform periodic maintenance on each vessel has been deducted, although there is no assurance that such estimate will be reflective of the actual off-hire in the future.
Note 15 — Contingencies:
Legal Proceedings Arising in the Ordinary Course of Business
The Company is a party, as plaintiff or defendant, to various suits in the ordinary course of business for monetary relief arising principally from personal injuries, wrongful death, collision or other casualty and to claims arising under charter parties and other contract disputes. A substantial majority of such personal injury, wrongful death, collision or other casualty claims against the Company is covered by insurance (subject to deductibles not material in amount). Each of the claims involves an amount which, in the opinion of management, should not be material to the Company’s financial position, results of operations and cash flows.
In late July 2023, one of the Company’s vessels was arrested in connection with a commercial dispute arising earlier in 2023. Although the vessel was subsequently released, the arresting party sought $
24
INTERNATIONAL SEAWAYS, INC.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements. Such forward-looking statements represent the Company’s reasonable expectation with respect to future events or circumstances based on various factors and are subject to various risks and uncertainties and assumptions relating to the Company’s operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors, many of which are beyond the control of the Company, that could cause the Company’s actual results to differ materially from those indicated in these statements. Undue reliance should not be placed on any forward-looking statements and consideration should be given to the following factors when reviewing any such statement. Such factors include, but are not limited to:
| ● | the highly cyclical nature of INSW’s industry; |
| ● | fluctuations in the market value of vessels; |
| ● | declines in charter rates, including spot charter rates or other market deterioration; |
| ● | an increase in the supply of vessels without a commensurate increase in demand; |
| ● | the impact of adverse weather and natural disasters; |
| ● | the adequacy of INSW’s insurance to cover its losses, including in connection with maritime accidents or spill events; |
| ● | constraints on capital availability; |
| ● | changing economic, political and governmental conditions in the United States and/or abroad and general conditions in the oil and natural gas industry; |
| ● | the effect of an increase in trade protectionism, including tariffs, and potential fees on vessels entering U.S. ports that were constructed in China or are owned or operated by a Chinese entity, and potential fees on vessels entering Chinese ports that were not constructed in China and that are owned or operated by a U.S. controlled entity; |
| ● | the impact of changes in fuel prices; |
| ● | acts of piracy on ocean-going vessels; |
| ● | terrorist attacks and seizures and active international hostilities and instability, including attacks against merchant vessels in the Arabian Gulf and Strait of Hormuz by Iran, and in the Red Sea and the Gulf of Aden by Iran-backed Houthi militants based in Yemen, as well as hostilities involving Iran, the United States and Israel; |
| ● | the war between Russia and Ukraine; |
| ● | the impact of public health threats and outbreaks of other highly communicable diseases; |
| ● | the effect of the Company’s indebtedness on its ability to finance operations, pursue desirable business opportunities and successfully run its business in the future; |
| ● | an event occurs that causes the rights issued under the Second Amended and Restated Rights Agreement adopted by the Company on April 9, 2026 to become exercisable; |
| ● | the Company’s ability to generate sufficient cash to service its indebtedness and to comply with debt covenants; |
| ● | the Company’s ability to make capital expenditures to expand the number of vessels in its fleet, and to maintain all of its vessels and to comply with existing and new regulatory standards; |
| ● | the availability and cost of third-party service providers for technical and commercial management of the Company’s fleet; |
| ● | the Company’s ability to renew its time charters when they expire or to enter into new time charters; |
| ● | termination or change in the nature of the Company’s relationship with any of the commercial pools in which it participates and the ability of such commercial pools to pursue a profitable chartering strategy; |
| ● | competition within the Company’s industry and INSW’s ability to compete effectively for charters with companies with greater resources; |
| ● | the loss of a large customer or significant business relationship; |
| ● | the Company’s ability to realize benefits from its past acquisitions or acquisitions or other strategic transactions it may make in the future; |
| ● | increasing operating costs and capital expenses as the Company’s vessels age, including increases due to limited shipbuilder warranties or the consolidation of suppliers; |
| ● | the Company’s ability to replace its operating leases on favorable terms, or at all; |
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INTERNATIONAL SEAWAYS, INC.
| ● | changes in credit risk with respect to the Company’s counterparties on contracts; |
| ● | the failure of contract counterparties to meet their obligations; |
| ● | the compliance by shipyards that are constructing the Company’s newbuild vessels with their obligations under the shipbuilding contracts; |
| ● | the Company’s ability to attract, retain and motivate key employees; |
| ● | work stoppages or other labor disruptions by employees of INSW or other companies in related industries; |
| ● | unexpected drydock costs; |
| ● | the potential for technological innovation to reduce the value of the Company’s vessels and charter income derived therefrom; |
| ● | the impact of an interruption in or failure of the Company’s information technology and communication systems upon the Company’s ability to operate; |
| ● | seasonal variations in INSW’s revenues; |
| ● | government requisition of the Company’s vessels during a period of war or emergency; |
| ● | the Company’s compliance with complex laws, regulations and in particular, environmental laws and regulations, including those relating to ballast water treatment and the emission of greenhouse gases and air contaminants, including from marine engines; |
| ● | legal, regulatory or market measures to address climate change, including proposals to restrict emissions of greenhouse gases (“GHGs”) and other sustainability initiatives; |
| ● | increasing scrutiny and changing expectations from investors, lenders, and other market participants with respect to our sustainability and governance policies; |
| ● | any non-compliance with the U.S. Foreign Corrupt Practices Act of 1977 or other applicable regulations relating to bribery or corruption; |
| ● | the impact of litigation, government inquiries and investigations; |
| ● | governmental claims against the Company; |
| ● | the arrest of INSW’s vessels by maritime claimants; |
| ● | changes in laws, including governing tax laws, treaties or regulations, including those relating to environmental and security matters; |
| ● | changes in worldwide trading conditions, including the impact of tariffs, trade sanctions, boycotts and other restrictions on trade; and |
| ● | pending and future tax law changes may result in significant additional taxes to INSW. |
The Company assumes no obligation to update or revise any forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q and written and oral forward-looking statements attributable to the Company or its representatives after the date of this Quarterly Report on Form 10-Q are qualified in their entirety by the cautionary statement contained in this paragraph and in other reports hereafter filed by the Company with the Securities and Exchange Commission.
INTRODUCTION
This Management’s Discussion and Analysis, which should be read in conjunction with our accompanying condensed consolidated financial statements and notes thereto, provides a discussion and analysis of our business, current developments, financial condition, cash flows and results of operations as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025. It is organized as follows:
| ● | General. This section provides a general description of our business, which we believe is important in understanding the results of our operations, financial condition and potential future trends. |
| ● | Operations & Oil Tanker Markets. This section provides an overview of industry operations and dynamics that have an impact on the Company’s financial position and results of operations. |
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INTERNATIONAL SEAWAYS, INC.
| ● | Critical Accounting Estimates and Policies. This section identifies any updates to those accounting policies that are considered important to our results of operations and financial condition, require significant judgment and involve significant management estimates. |
| ● | Results from Vessel Operations. This section provides an analysis of our results of operations presented on a business segment basis. In addition, a brief description of significant transactions and other items that affect the comparability of the results is provided, if applicable. |
| ● | Liquidity and Sources of Capital. This section provides an analysis of our cash flows, outstanding debt and commitments. Included in the analysis of our outstanding debt is a discussion of the amount of financial capacity available to fund our ongoing operations and future commitments as well as a discussion of the Company’s planned and/or already executed capital allocation activities. |
| ● | Risk Management. This section provides a general overview of how the interest rate, currency and fuel price volatility risks are managed by the Company. |
This Quarterly Report on Form 10-Q includes industry data and forecasts that we have prepared based, in part, on information obtained from industry publications and surveys. Third-party industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable. In addition, certain statements regarding our market position in this report are based on information derived from internal market studies and research reports. Unless we state otherwise, statements about the Company’s relative competitive position in this report are based on our management’s beliefs, internal studies and management’s knowledge of industry trends.
General:
We are a provider of ocean transportation services for crude oil and refined petroleum products. We operate our vessels in the International Flag market. Our business includes two reportable segments: Crude Tankers and Product Carriers. For both the three and six months ended June 30, 2026 we derived 58% of our time charter equivalent (“TCE”) revenues from our Crude Tankers segment compared with 52% and 50% for the three and six months ended June 30, 2025, respectively. Revenues from our Product Carriers segment constituted the balance of our TCE revenues in the 2026 and 2025 periods.
As of June 30, 2026, our operating fleet, which includes VLCC, Suezmax and Aframax crude tankers and LR2, LR1 and MR product carriers, consisted of 64 wholly-owned or lease financed vessels aggregating 7.6 million deadweight tons (“dwt”). In addition to our operating fleet of 64 vessels, four LR1 newbuilds are scheduled for delivery to the Company between the third quarter of 2026 and fourth quarter of 2028, bringing the total operating and newbuild fleet to 68 vessels. On July 1, 2026, the Company entered into contracts to build an additional two LR1 vessels, which are expected to be delivered in the second half of 2028. In addition to the Company’s operating fleet, Tankers International Suezmax Limited (“TISL”), a variable interest entity that is consolidated by the Company, has one Suezmax tanker time chartered-in from a third-party under its pool participation agreement as of June 30, 2026. See Note 8, “Variable Interest Entities (“VIEs”)” to the accompanying condensed consolidated financial statements for additional information on consolidated and unconsolidated VIEs.
The Company’s revenues are highly sensitive to (i) patterns of supply and demand for vessels of the size and design configurations owned and operated by the Company and the trades in which those vessels operate and (ii) the Company’s vessel employment strategy.
Rates for the transportation of crude oil and refined petroleum products from which the Company earns a substantial majority of its revenues are determined by market forces such as the supply and demand for oil, the distance that cargoes must be transported, and the number of vessels expected to be available at the time such cargoes need to be transported. The demand for oil shipments is significantly affected by the state of the global economy, levels of U.S. domestic and international production and OPEC exports. The number of vessels available to transport cargo is affected by newbuilding deliveries and by the removal of existing vessels from service, principally through storage, recycling or conversions.
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The outbreak of war in the Middle East between Iran and the U.S. and Israel in late February 2026, and the seizures and attacks on vessels travelling through the Red Sea, the Gulf of Aden and the Arabian Gulf, and the effective closure of the Strait of Hormuz, have caused supply disruptions in the oil and gas markets and significant volatility in energy prices and spot charter hire rates. The sharp increase in oil prices and concerns that the supply of crude oil and petroleum products may be significantly constrained for some period of time has led a number of countries to impose export restrictions on certain oil and petroleum products. Also, while charter rates for crude tankers and product carriers initially increased and remain high following the disruption to shipping in the Middle East areas noted above, it is unlikely that the charter rates will remain at these historically high levels. We also expect the voyage expenses of the commercial pools in which we participate to be high in the near-term due to high bunker costs and being subject to additional war risks insurance premiums when the pool’s vessels transit through or call to any ports or areas or the waters of any country bordering the Arabian Gulf or the Red Sea. To date, these geopolitical developments have not had a material adverse effect on INSW’s operations, financial condition, results of operations or cash flow. The extent of any future impact will depend on how the situation develops, including any continued disruption in the Strait of Hormuz and the surrounding region and its effect on global energy markets, including the restoration, and timing thereof, of damage to the existing energy infrastructure.
The Company’s revenues are also affected by its vessel employment strategy, which seeks to achieve the optimal mix of spot (voyage charter) and long-term (time or bareboat charter) charters. Because shipping revenues and voyage expenses are significantly affected by the mix between voyage charters and time charters, the Company measures the performance of its fleet of vessels based on TCE revenues. Management makes economic decisions based on anticipated TCE rates and evaluates financial performance based on TCE rates achieved.
Our revenues are derived primarily from spot market voyage charters and our vessels are predominantly employed in the spot market via market-leading commercial pools. We derived approximately 80% and 81% of our total TCE revenues in the spot market for the three and six months ended June 30, 2026, respectively, compared with 82% and 81% for the three and six months ended June 30, 2025, respectively. The future minimum revenues, before reduction for brokerage commissions, expected to be received on non-cancelable time charters for three VLCCs, three Suezmaxes, one Aframax, one LR2, and five MRs, as of June 30, 2026 are as follows:
(Dollars in millions) | Amount(1) | ||
2026 | $ | 57.4 | |
2027 | 70.0 | ||
2028 | 64.7 | ||
2029 | 41.1 | ||
2030 | 7.0 | ||
Future minimum revenues | $ | 240.2 | |
| (1) | Future minimum contracted revenues do not include the Company’s share of time charters entered into by the pools in which it participates or profit-sharing above the base rate on the newbuild dual-fuel LNG VLCCs. In arriving at the minimum future charter revenues, an estimated time off-hire to perform periodic maintenance on each vessel has been deducted, although there is no assurance that such estimate will be reflective of the actual off-hire in the future. |
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INTERNATIONAL SEAWAYS, INC.
Operations and Oil Tanker Markets:
The International Energy Agency (“IEA”) estimates global oil consumption for the second quarter of 2026 at 99.1 million barrels per day (“b/d”), down 4.7% from the same quarter in 2025. The estimate for global oil consumption for 2026 is 103.5 million b/d, a decrease of 1.0% from 2025 levels. OECD demand in 2026 is estimated to decrease by 0.9% to 45.5 million b/d, while non-OECD demand is estimated to decrease by 1.0% to 58.0 million b/d.
Global oil production in the second quarter of 2026 was 97.2 million b/d, a decrease of 6.4 million b/d from the second quarter of 2025, and a decrease of 5.9 million b/d from the first quarter of 2026 due to effects related to the closure of the Strait of Hormuz. OPEC crude oil production averaged 20 million b/d in the second quarter of 2026, a decrease of 5.9 million b/d from the first quarter of 2026, and a decrease of 7.0 million b/d from the second quarter of 2025. Non-OPEC production increased by 4.5 million b/d to 75.9 million b/d in the second quarter of 2026 compared with the second quarter of 2025. Oil production in the U.S. of 13.9 million b/d in the second quarter of 2026 increased by 4.7% from the first quarter of 2026 and by 3.5% from the second quarter of 2025.
U.S. refinery throughput decreased by 0.4 million b/d to 16.2 million b/d in the second quarter of 2026 compared with the first quarter of 2026.
U.S. crude oil imports in the second quarter of 2026 increased by 3.7% to 6.3 million b/d compared with the second quarter of 2025, with imports from OPEC countries increasing by 0.3 million b/d and imports from non-OPEC countries remaining flat. China’s crude oil imports in June were estimated to be 6.4 million b/d, a dramatic decrease from earlier levels due to the impact of the closure of the Strait of Hormuz and subsequent usage of local crude stocks to mitigate the decreased imports.
OECD commercial crude inventories in the second quarter of 2026 decreased by 3.1%, or 33 million barrels, compared with the first quarter of 2026. OECD commercial product inventories in the second quarter of 2026 decreased by 2.4%, or 36 million barrels, compared with the first quarter of 2026. Additionally, OECD government-controlled crude and product inventories decreased by 11.9%, or 148 million barrels in the aggregate, between the first and second quarters of 2026. These movements in stock levels are largely as a result of the closure of the Strait of Hormuz and the impact this is having on the global oil market.
During the second quarter of 2026, the tanker fleet of vessels over 10,000 dwt increased, net of vessels recycled, by 9.2 million dwt. The crude fleet increased by 6.8 million dwt, with VLCCs, Suezmaxes and Aframaxes increasing by 2.2 million dwt, 2.2 million dwt and 2.4 million dwt, respectively. The product carrier fleet increased by 2.4 million dwt, with LR1s increasing by 0.4 million dwt and MRs increasing by 2.0 million dwt. Year-over-year, the size of the tanker fleet increased by 27.2 million dwt with the increases of 5.9
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million dwt, 5.3 million dwt, 7.5 million dwt, 1.1 million dwt and 7.4 million dwt in the VLCCs, Suezmax, Aframax, LR1 and MR fleets, respectively.
During the second quarter of 2026, the tanker orderbook increased by 19.8 million dwt from the first quarter of 2026. The crude tanker orderbook increased by 19.8 million dwt. The VLCC, Suezmax and Aframax orderbooks increased by 16.6 million dwt, 1.6 million dwt and 1.6 million dwt, respectively. The product carrier orderbook increased by 0.1 million dwt, with the LR1 orderbook decreasing by 0.2 million dwt and the MR orderbook increasing by 0.2 million dwt. Year-over-year, the total tanker orderbook increased by 73.5 million dwt, with increases in VLCC, Suezmaxes and Aframaxes of 57.6 million dwt, 12.4 million dwt and 4.7 million dwt, respectively. The LR1 and MR orderbooks decreased by 0.9 million dwt and 0.3million dwt, respectively.
Tanker rates continued the strong trend from the first quarter across the board. When and as conditions normalize, while it is unlikely these rates are sustainable, we would expect tanker markets to benefit from the rebalancing of trade flows and the replenishment of inventories.
Update on Critical Accounting Estimates and Policies:
The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, which require the Company to make estimates in the application of its accounting policies based on the best assumptions, judgments and opinions of management. For a description of all of the Company’s material accounting policies, see Note 2, “Summary of Significant Accounting Policies,” to the Company’s consolidated financial statements as of and for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K. See Note 3, “Significant Accounting Policies,” to the accompanying condensed consolidated financial statements for any changes or updates to the Company’s critical accounting policies for the current period.
Results from Vessel Operations:
During the second quarter of 2026, income from vessel operations increased by $232.0 million to $301.3 million from $69.4 million in the second quarter of 2025. Such increase resulted principally from significantly higher TCE revenues, partially offset by a $11.3 million decrease in gains from vessel sales, as no vessels were sold during the current quarter.
TCE revenues in the second quarter of 2026 increased by $245.4 million, or 130%, to $434.2 million from $188.8 million in the second quarter of 2025. This increase reflects (i) an aggregate $267.6 million rates-based increase resulting from higher average daily rates earned across the Company’s fleet sectors, partially offset by (ii) a $16.8 million days-based reduction in the MR sector, which reflects the Company selling several of the older vessels in its fleet, as detailed below in the “Product Carriers” discussion.
During the first half of 2026, income from vessel operations increased by $461.4 million to $589.9 million from $128.5 million in the first half of 2025. Such increase resulted principally from a $384.3 million increase in TCE revenues, a $9.8 million decrease in vessel expenses and $66.9 million in incremental gains on the vessel sales recognized in the first half of 2026.
The $384.3 million, or 105%, increase in TCE revenues to $751.4 million in the first half of 2026 compared to TCE revenues of $367.2 million in the first half of 2025 was attributable to (i) an aggregate $424.4 million rates-based increase resulting from higher average daily rates earned across INSW’s fleet sectors, partially offset by (ii) a $41.0 million days-based decline in earnings from our MR, LR1 and VLCC fleets, primarily as a result of sales of older vessels, as further detailed below.
See Note 5, “Business and Segment Reporting,” to the accompanying condensed consolidated financial statements for additional information on the Company’s segments, including reconciliations of (i) time charter equivalent revenues to shipping revenues and (ii) adjusted income from vessel operations for the segments to net income, as reported in the condensed consolidated statements of operations.
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Crude Tankers
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands, except daily rate amounts) | 2026 | 2025 | 2026 | 2025 | ||||||||
TCE revenues | $ | 253,364 | $ | 98,908 | $ | 437,639 | $ | 183,537 | ||||
Vessel expenses | (29,434) | (30,015) | (59,831) | (58,433) | ||||||||
Charter hire expenses | (14,278) | (3,673) | (18,773) | (6,509) | ||||||||
Depreciation and amortization | (18,497) | (18,746) | (38,472) | (37,449) | ||||||||
Adjusted income from vessel operations (a) | $ | 191,155 | $ | 46,474 | $ | 320,564 | $ | 81,146 | ||||
Average daily TCE rate | $ | 108,927 | $ | 39,627 | $ | 90,105 | $ | 37,093 | ||||
Average number of owned vessels (b) | 24.0 | 19.0 | 24.8 | 19.3 | ||||||||
Average number of vessels chartered-in | 4.1 | 9.1 | 3.6 | 9.0 | ||||||||
Number of revenue days (c) | 2,326 | 2,496 | 4,857 | 4,948 | ||||||||
Number of ship-operating days: (d) | ||||||||||||
Owned vessels | 2,184 | 1,729 | 4,481 | 3,499 | ||||||||
Vessels bareboat chartered-in under leases (e) | 273 | 819 | 543 | 1,629 | ||||||||
Vessels time chartered-in under operating leases (f) | 91 | — | 96 | — | ||||||||
Vessels spot chartered-in under leases (g) | 12 | 5 | 16 | 5 | ||||||||
| (a) | Adjusted income from vessel operations by segment is before other operating revenues, general and administrative expenses, other operating expenses and gain on disposal of vessels and other property, net. |
| (b) | The average is calculated to reflect the addition and disposal of vessels during the period. |
| (c) | Revenue days represent ship-operating days less days that vessels were not available for employment due to repairs, drydock or lay-up. Revenue days are weighted to reflect the Company’s interest in chartered-in vessels. |
| (d) | Ship-operating days represent calendar days. |
| (e) | Represents VLCCs that secured lease financing arrangements during the periods presented. In November 2025 the Company purchased six of the nine VLCCs that it had been bareboat chartering-in. |
| (f) | Represents third-party vessels time chartered-in by TISL under its variable rate pool participation agreement. |
| (g) | Represents vessels spot chartered-in by the Company’s Crude Tankers Lightering business for full service lightering jobs. |
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The following tables provide a breakdown of TCE rates achieved for the three and six months ended June 30, 2026 and 2025, between spot and fixed earnings and the related revenue days. The information in this table is based, in part, on information provided by the commercial pools in which the segment’s vessels participate and excludes commercial pool fees/commissions averaging approximately $1,978 and $960 per day for the three months ended June 30, 2026 and 2025, respectively, and $1,828 and $1,036 per day for the six months ended June 30, 2026 and 2025, respectively, as well as activity in the Crude Tankers Lightering business and revenue and revenue days for which recoveries were recorded by the Company under its loss of hire insurance policies. The fixed earnings rates in the table are net of broker/address commissions.
2026 | 2025 | |||||||||||
Spot Earnings | Fixed Earnings | Spot Earnings | Fixed Earnings | |||||||||
Three Months Ended June 30, | ||||||||||||
VLCC: | ||||||||||||
Average rate | $ | 118,883 | $ | 214,216 | $ | 39,303 | $ | 38,809 | ||||
Revenue days | 522 | 274 | 644 | 273 | ||||||||
Suezmax: | ||||||||||||
Average rate | $ | 100,543 | $ | 37,854 | $ | 36,830 | $ | 33,791 | ||||
Revenue days | 890 | 273 | 1,106 | 53 | ||||||||
Aframax: | ||||||||||||
Average rate | $ | 69,127 | $ | 38,501 | $ | 30,747 | $ | 38,496 | ||||
Revenue days | 264 | 91 | 273 | 83 | ||||||||
Six Months Ended June 30, | ||||||||||||
VLCC(1): | ||||||||||||
Average rate | $ | 100,856 | $ | 172,010 | $ | 36,388 | $ | 38,394 | ||||
Revenue days | 1,215 | 539 | 1,302 | 543 | ||||||||
Suezmax: | ||||||||||||
Average rate | $ | 83,512 | $ | 37,496 | $ | 33,894 | $ | 31,036 | ||||
Revenue days | 1,869 | 457 | 2,194 | 130 | ||||||||
Aframax: | ||||||||||||
Average rate | $ | 60,217 | $ | 38,506 | $ | 28,099 | $ | 38,499 | ||||
Revenue days | 530 | 181 | 543 | 172 | ||||||||
| (1) | The average rate reported in the table above for VLCCs in the six months ended June 30, 2026 represents VLCCs less than 15 years of age. The Company sold its final remaining VLCC, which was over 15 years of age, in February 2026. The average spot TCE rate earned by the Company’s VLCCs on an overall basis during such period was $98,918. Additionally, during the first quarter of 2026, the Company paid a favorable positioning pool withdrawal fee to facilitate the early exit of one of its vessels from a commercial pool ahead of its sale. Such fee is excluded from the table above because the Company was reimbursed for this fee by the purchaser of the vessel. |
During the second quarter of 2026, TCE revenues for the Crude Tankers segment increased by $154.5 million, or 156%, to $253.4 million from $98.9 million in the second quarter of 2025. Such increase principally resulted from (i) an aggregate rates-based increase in the VLCC, Suezmax and Aframax sectors of $157.3 million which resulted from the very strong rate environment during the current quarter as described in the “Operations and Oil Tanker Markets” section above, as well as due to significantly higher profit-sharing results recognized under the VLCC time charters, and (ii) a $3.8 million increase in the Crude Tankers Lightering business. Partially offsetting the TCE revenue increases described above was a $6.8 million days-based decrease in the VLCC sector, which reflects 90 more off-hire days in the current period and a decrease in fleet days relating to the net impact of the sales of one 2010-built VLCC and one 2012-built VLCC during the first quarter of 2026, partially offset by the Company’s acquisition of a 2020-built VLCC in November 2025.
Charter hire expenses increased by $10.6 million quarter-over-quarter primarily because charter hire expense for the second quarter of 2026 included hire due to a third party participant of TISL, the Suezmax tankers pool formed in March 2026 (as described in Note 8, “Variable Interest Entities,” to the accompanying condensed consolidated financial statements). Additionally, charter hire expense in
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the Crude Tankers Lightering business increased by $0.9 million, which reflects incremental chartered-in Aframax days for two full-service jobs completed during the current period and increased daily rates on a portion of its chartered-in workboat fleet.
Excluding depreciation and amortization and general and administrative expenses, operating income for the Crude Tankers Lightering business was $5.9 million for the second quarter of 2026 compared with $2.8 million for the second quarter of 2025. The increase reflects growth in quarter-over-quarter activity levels, with 133 service support-only lighterings and two full-service lightering jobs being performed during the second quarter of 2026 compared with 93 service support-only lighterings and one full-service lightering job being performed during the second quarter of 2025.
During the first six months of 2026, TCE revenues for the Crude Tankers segment increased by $254.1 million, or 138%, to $437.6 million from $183.5 million in the first six months of 2025. Such increase principally resulted from (i) an aggregate rates-based increase in the VLCC, Suezmax and Aframax fleets of $256.1 million due to higher average daily blended rates in these sectors, and (ii) a $1.6 million increase in the Crude Tankers Lightering business. Partially offsetting these increases was a $3.5 million days-based decline in the VLCC sector, which reflected the impact of the sales and purchases in the VLCC fleet described above.
Charter hire expenses increased by $12.3 million period-over-period due to the inclusion of hire due to a third-party participant of TISL, as described above, and incremental charter hire in the Crude Tankers Lightering business, as described above.
Excluding depreciation and amortization and general and administrative expenses, operating income for the Crude Tankers Lightering business was $5.6 million for both the first half of 2026 and 2025, as increased revenue driven by higher activity levels in the current period was largely offset by higher charter hire expense.
Product Carriers
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands, except daily rate amounts) | 2026 | 2025 | 2026 | 2025 | ||||||||
TCE revenues | $ | 180,823 | $ | 89,914 | $ | 313,793 | $ | 183,627 | ||||
Vessel expenses | (34,197) | (37,406) | (64,839) | (76,016) | ||||||||
Charter hire expenses | (908) | (5,954) | (4,109) | (12,263) | ||||||||
Depreciation and amortization | (21,192) | (22,603) | (41,784) | (43,605) | ||||||||
Adjusted income from vessel operations | $ | 124,526 | $ | 23,951 | $ | 203,061 | $ | 51,743 | ||||
Average daily TCE rate | $ | 56,226 | $ | 21,500 | $ | 47,444 | $ | 21,780 | ||||
Average number of owned vessels | 32.8 | 43.7 | 33.5 | 43.7 | ||||||||
Average number of vessels chartered-in | 4.3 | 5.8 | 4.6 | 5.9 | ||||||||
Number of revenue days | 3,216 | 4,182 | 6,614 | 8,431 | ||||||||
Number of ship-operating days: | ||||||||||||
Owned vessels | 2,984 | 3,978 | 6,055 | 7,901 | ||||||||
Vessels bareboat chartered-in under leases (a) | 364 | 364 | 724 | 724 | ||||||||
Vessels time chartered-in under leases | 26 | 166 | 116 | 346 | ||||||||
| (a) | Represents MRs that secured lease financing arrangements during the periods presented. |
The following tables provide a breakdown of TCE rates achieved for the three and six months ended June 30, 2026 and 2025, between spot and fixed earnings and the related revenue days. The information in this table is based, in part, on information provided by the commercial pools in which the segment’s vessels participate and excludes commercial pool fees/commissions averaging approximately $875 and $778 per day for the three months ended June 30, 2026 and 2025, respectively, and $844 and $773 per day for the six months ended June 30, 2026 and 2025, respectively, as well as revenue and revenue days for which recoveries were
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recorded by the Company under its loss of hire insurance policies. The fixed earnings rates in the table are net of broker/address commissions.
2026 | 2025 | |||||||||||
Spot Earnings | Fixed Earnings | Spot Earnings | Fixed Earnings | |||||||||
Three Months Ended June 30, | ||||||||||||
LR2: | ||||||||||||
Average rate | $ | — | $ | 39,445 | $ | — | $ | 39,500 | ||||
Revenue days | — | 73 | — | 91 | ||||||||
LR1(1): | ||||||||||||
Average rate | $ | 79,180 | $ | — | $ | 32,802 | $ | — | ||||
Revenue days | 558 | — | 702 | — | ||||||||
MR(2): | ||||||||||||
Average rate | $ | 60,342 | $ | 22,099 | $ | 18,941 | $ | 21,445 | ||||
Revenue days | 2,015 | 486 | 2,624 | 720 | ||||||||
Six Months Ended June 30, | ||||||||||||
LR2: | ||||||||||||
Average rate | $ | — | $ | 39,480 | $ | — | $ | 39,459 | ||||
Revenue days | — | 163 | — | 181 | ||||||||
LR1(1): | ||||||||||||
Average rate | $ | 75,124 | $ | — | $ | 30,053 | $ | — | ||||
Revenue days | 1,065 | — | 1,421 | — | ||||||||
MR(2): | ||||||||||||
Average rate | $ | 48,295 | $ | 22,067 | $ | 20,184 | $ | 21,613 | ||||
Revenue days | 4,207 | 1,018 | 5,288 | 1,431 | ||||||||
| (1) | In order to take advantage of market conditions and optimize economic performance, during the 2026 and 2025 periods, management employed all of the Company’s LR1 product carriers, which operate in the Panamax International pool, exclusively in the transportation of crude oil cargoes. During the three and six months ended June 30, 2026, LR1s were employed on transitional voyages in the spot market outside of their ordinary course operations in the Panamax International pool. Such transitional voyages are excluded from the table above and represented 84 days and 161 days in the three and six months ended June 30, 2026, respectively. |
| (2) | During the three and six months ended June 30, 2025, one MR, which was acquired by the Company during 2025, was employed on transitional voyages in the spot market prior to joining the Norden MR Pool. Such transitional voyages are excluded from the table above. |
During the second quarter of 2026, TCE revenues for the Product Carriers segment increased by $91.0 million, or 101%, to $180.8 million from $89.9 million in the second quarter of 2025. The increase in TCE revenues was primarily as a result of an aggregate $110.3 million rates-based increase in the LR1 and MR sectors due to higher average daily blended rates earned in the current quarter. Such increase was partially offset by (i) a $16.8 million days-based decrease in the MR sector, which reflects the net impact of the Company’s sale of 13 MRs between June 2025 and March 2026, and 268 fewer off-hire days in the current quarter, and (ii) a $1.9 million days-based decrease in the LR1 sector, which resulted primarily from a 140-day quarter-over-quarter decrease in time chartered-in LR1 days, 83 more off-hire days during the current quarter, and the sale of two 2006-built LR1s during the third quarter of 2025, substantially offset by the Company taking delivery of four dual-fuel ready LNG newbuild LR1s between September 2025 and April 2026.
Vessel expenses decreased by $3.2 million to $34.2 million in the second quarter of 2026 from $37.4 million in the second quarter of 2025. Such decrease principally reflects the sales of the MRs referenced above, partially offset by the net vessel acquisitions in the LR1 fleet detailed above. Charter hire expenses decreased by $5.0 million to $0.9 million in the current quarter from $6.0 million in the second quarter of 2025 as a result of the decrease in time chartered-in LR1s noted above. Depreciation and amortization decreased
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by $1.4 million to $21.2 million in the current quarter from $22.6 million in the prior year’s quarter. Such decrease resulted primarily from the sales in the MR fleet described above, offset to a large extent by increased depreciation in the LR1 fleet resulting from the fleet changes noted above.
During the first half of 2026, TCE revenues for the Product Carriers segment increased by $130.2 million, or 71%, to $313.8 million from $183.6 million in the first half of 2025. The growth in TCE revenues was primarily as a result of (i) an aggregate $168.1 million rates-based increase in the LR1 and MR sectors due to higher average daily blended rates earned in the current period, partially offset by (ii) a $31.7 million days-based decrease in the MR sector, which reflects the MR sales described above, partially offset by 424 fewer off-hire days in the current period and the acquisition of two MRs in January 2025 and (iii) a $5.7 million days-based decrease in the LR1 sector, which resulted primarily from a 230-day decrease in time chartered-in days and 147 more off-hire days in the current period, partially offset by the net increases to the LR1 fleet which resulted from the vessel sale and purchase transactions described above.
Vessel expenses decreased by $11.2 million to $64.8 million in the first six months of 2026 from $76.0 million in the first six months of 2025. Such decrease was principally attributable to the net sales in our MR fleet referenced above, partially offset by the net additions in the LR1 fleet. Charter hire expenses decreased by $8.2 million to $4.1 million in the current period from $12.3 million in the prior year’s period, primarily as a result of the period-over-period decrease in time chartered-in LR1 days described above.
Other Operating Revenues
Other operating revenues totaling $2.4 million and $4.3 million during the three and six months ended June 30, 2026, respectively, represents fees earned by the Company’s wholly owned subsidiaries – Tankers (UK) Agencies Limited (“TUKA”) and Tankers (UK) Suezmax Agencies Limited (“TUKSA”) for commercial management services rendered to vessel owners participating in the VLCC and Suezmax tanker pools operated by Tankers International Limited (“TIL”) and TISL, respectively. See Note 8, “Variable Interest Entities (“VIEs”),” to the accompanying condensed consolidated financial statements for additional information on consolidated and unconsolidated VIEs.
General and Administrative Expenses
During the second quarter of 2026, general and administrative expenses increased by $4.4 million to $16.6 million from $12.2 million in the second quarter of 2025. The primary drivers for the quarter-over-quarter increase were the consolidation of the operating expenses of TUKA and TUKSA aggregating $3.3 million and $0.5 million in costs incurred in connection with the adoption of the Second A&R Rights Agreement. The costs incurred by TUKA and TUKSA are substantially recovered by the Company through pool management fees charged to TIL and TISL, as discussed in the “Other Operating Revenues” section above.
For the six months ended June 30, 2026, general and administrative expenses increased by $0.5 million to $25.9 million from $25.4 million for the same period in 2025. The increase reflects the consolidation of the operating expenses of TUKA aggregating $5.4 million and $0.5 million in costs incurred in connection with the adoption of the Second A&R Rights Agreement. Such increases were largely offset by a $5.4 million decrease in legal fees, which in part reflected the recovery of $4.8 million in damages awarded to the Company by an arbitration tribunal in England in connection with a commercial dispute that arose in 2023. See Note 15, “Contingencies,” to the accompanying condensed consolidated financial statements for additional information.
Other Income
Other income, which is primarily comprised of interest income earned on invested cash, was $4.1 million and $6.8 million for the three and six months ended June 30, 2026, respectively, compared with $2.0 million and $3.9 million for the three and six months ended June 30, 2025. The period-over-period increase in interest income reflects the impact of higher average balances of invested cash during the three and six months ended June 30, 2026.
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INTERNATIONAL SEAWAYS, INC.
Interest Expense
The components of interest expense are as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Interest before items shown below | $ | 11,578 | $ | 11,582 | $ | 22,110 | $ | 24,173 | ||||
Interest cost on defined benefit pension obligation | 215 | 210 | 422 | 407 | ||||||||
Impact of interest rate hedge derivatives | (400) | (1,003) | (875) | (1,600) | ||||||||
Capitalized interest | (832) | (1,028) | (2,137) | (1,767) | ||||||||
Interest expense | $ | 10,561 | $ | 9,761 | $ | 19,520 | $ | 21,213 | ||||
Interest expense increased during the three months ended June 30,026 compared to the corresponding 2025 period as a result of an increase in the average outstanding principal balance outstanding, principally related to draws under the ECA Credit Facility in connection with the delivery of the first 4 LR1 newbuildings.
Interest expense decreased during the six months ended June 30, 2026 compared to the corresponding 2025 period as a result of (i) a reduction in the average outstanding principal balance under the Company’s floating rate debt facilities, due to voluntary repayments of certain of such facilities, (ii) the repayment in full of the OCY Lease Financing in November 2025, and (iii) the decline of SOFR rates during the first half of 2026 compared to the first half of 2025. See Note 10, “Debt,” in the accompanying condensed consolidated financial statements for further information on the Company’s debt facilities.
Taxes
The Company qualifies for an exemption from U.S. federal income taxes under Section 883 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) and U.S. Treasury Department regulations for the 2026 calendar year, as less than 50 percent of the total value of the Company’s stock was held by one or more shareholders who own 5% or more of the Company’s stock for more than half of the days of 2026. There can be no assurance at this time that INSW will continue to qualify for the Section 883 exemption beyond calendar year 2026. Should the Company not qualify for the exemption in the future, INSW will be subject to U.S. federal income taxation of 4% of its U.S. source shipping income on a gross basis without the benefit of deductions. Shipping income that is attributable to transportation that begins or ends, but that does not both begin and end, in the U.S. will be considered to be 50% derived from sources within the United States. Shipping income attributable to transportation that both begins and ends in the U.S. would be considered to be 100% derived from sources within the United States, but INSW does not and cannot engage in transportation that gives rise to such income, except pursuant to any applicable waiver given by the U.S. government.
All of the Company’s vessel-owning subsidiaries and certain intermediate holding company subsidiaries are domiciled in Bermuda. The Bermuda Corporate Income Tax Act (the “Bermuda CIT Act”) provides an exclusion for Qualifying International Shipping Income (as defined in the Bermuda CIT Act), provided that applicable economic substance requirements relating to strategic or commercial management in Bermuda are satisfied. In compliance with the Bermuda CIT Act and applicable economic substance requirements, the strategic management of the Company’s international shipping income-generating subsidiaries and their intermediate parent holding companies is carried out from Bermuda. Based on the foregoing, the Company currently expects that its international shipping income will qualify for the Qualifying International Shipping Income exclusion under the Bermuda CIT Act. Under current Bermuda tax law, including the Bermuda CIT Act, Bermuda does not impose withholding taxes on distributions from the Company’s Bermuda subsidiaries.
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INTERNATIONAL SEAWAYS, INC.
EBITDA and Adjusted EBITDA
EBITDA represents net income before interest expense, income taxes and depreciation and amortization expense. Adjusted EBITDA consists of EBITDA adjusted for the impact of certain items that we do not consider indicative of our ongoing operating performance. EBITDA and Adjusted EBITDA are presented to provide investors with meaningful additional information that management uses to monitor ongoing operating results and evaluate trends over comparative periods. EBITDA and Adjusted EBITDA do not represent, and should not be considered a substitute for, net income or cash flows from operations determined in accordance with GAAP. EBITDA and Adjusted EBITDA have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of our results reported under GAAP. Some of the limitations are:
| ● | EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; |
| ● | EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; and |
| ● | EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt. |
While EBITDA and Adjusted EBITDA are frequently used by companies as a measure of operating results and performance, neither of those items as prepared by the Company is necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation.
The following table reconciles net income, as reflected in the condensed consolidated statements of operations, to EBITDA and Adjusted EBITDA:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
(Dollars in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||
Net income | $ | 294,925 | $ | 61,646 | $ | 581,068 | $ | 111,211 | ||||
Income tax benefit | (1) | — | (1) | — | ||||||||
Interest expense | 10,561 | 9,761 | 19,520 | 21,213 | ||||||||
Depreciation and amortization | 39,689 | 41,349 | 80,256 | 81,054 | ||||||||
EBITDA | 345,174 | 112,756 | 680,843 | 213,478 | ||||||||
Loss/(gain) on disposal of vessels and other assets, net | 43 | (11,229) | (88,128) | (21,250) | ||||||||
Holding gain on previously held equity interest | — | — | (3,919) | — | ||||||||
Adjusted EBITDA | $ | 345,217 | $ | 101,527 | $ | 588,796 | $ | 192,228 | ||||
Liquidity and Sources of Capital:
Our business is capital intensive. Our ability to successfully implement our strategy is dependent on the continued availability of capital on attractive terms. In addition, our ability to successfully operate our business to meet near-term and long-term debt repayment obligations is dependent on maintaining sufficient liquidity.
Liquidity
As of June 30, 2026, we had total liquidity on a consolidated basis of $935.1 million comprised of $409.4 million of cash and short-term investments and $525.7 million of undrawn revolver capacity.
Working capital at June 30, 2026 and December 31, 2025 was $651.5 million and $268.2 million, respectively. Current assets are highly liquid, consisting principally of cash, interest-bearing deposits, receivables and inventories. Current liabilities include current installments of long-term debt of $39.2 million and $25.8 million at June 30, 2026 and December 31, 2025, respectively.
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The Company’s cash and cash equivalents increased by $42.5 million during the six months ended June 30, 2026. The increase principally reflects the net impact of (i) $408.7 million of cash provided by operating activities; (ii) $222.4 million of proceeds from the disposal of vessels and other assets; (iii) $85.2 million of borrowings under the ECA Credit Facility; (iv) $8.5 million of net borrowings under the TISL Borrowing Base Facility; (v) $200 million in net cash invested in short-term investments; (vi) $122.9 million in expenditures for vessels, vessel improvements and other property, of which $121.1 million was construction in progress payments; (vii) $4.5 million cash consideration paid for the purchase of equity method investment, net of cash acquired; (viii) $331.8 million of cash dividends paid to shareholders; and (ix) $12.7 million in regularly scheduled principal amortization of the Company’s lease financing arrangements and ECA Credit Facility.
Our cash and cash equivalents balances generally exceed Federal Deposit Insurance Corporation insured limits. We place our cash and cash equivalents in what we believe to be credit-worthy financial institutions. In addition, certain of our money market accounts invest in U.S. Treasury securities or other obligations issued or guaranteed by the U.S. government or its agencies, floating rate and variable demand notes of U.S. and foreign corporations, commercial paper rated in the highest category by Moody’s Investor Services and Standard & Poor’s, certificates of deposit and time deposits, asset-backed securities, and repurchase agreements.
As of June 30, 2026, we had total debt outstanding of $645.6 million (net of deferred financing costs of $13.6 million) and net debt to capital of 9.4%, compared with 16.5% at December 31, 2025.
Sources, Uses and Management of Capital
Focused on our business strategy goals, during 2026 to date, we have continued to (i) make substantial returns to shareholders and (ii) use incremental liquidity generated from operations and the proceeds from disposal of older tonnage at strong prices to enhance our balance sheet and liquidity position as well as invest in renewing and growing our fleet.
In addition to future operating cash flows, our other future sources of funds are proceeds from issuances of equity securities, additional borrowings as permitted under our loan agreements and proceeds from the opportunistic sales of our vessels. Our current uses of funds are to fund working capital requirements, maintain the quality of our vessels, purchase vessels, pay newbuilding construction costs, comply with international shipping standards and environmental laws and regulations, repay or repurchase our outstanding loan facilities, pay a quarterly cash dividend, and from time to time, repurchase shares of our common stock and pay supplemental cash dividends.
On May 11, 2026, we terminated the equity distribution agreement dated December 20, 2023, with Evercore Gorup LLC and Jefferies LLC and entered into an Equity Distribution Agreement (the “Distribution Agreement”) with BTIG, LLC, B. Riley Securities, Inc., Clarksons Securities, Inc. and Fearnleys Securities, Inc., as sales agents, relating to the common shares of International Seaways, Inc. In accordance with the terms of the Distribution Agreement, we may offer and sell common shares having an aggregate offering price of up to $200.0 million from time to time through the sales agents. Sales of shares of our common stock, if any, may be made in privately negotiated transactions, which may include block trades, or transactions that are deemed to be "at the market" offerings as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly on the New York Stock Exchange or sales made to or through a market maker other than on an exchange or as otherwise agreed upon by the sales agents and us. We also may sell some or all of the shares in this offering to a sales agent as principal for its own account at a price per share agreed upon at the time of sale.
We will designate the minimum price per share at which the common shares may be sold and the maximum amount of common shares to be sold through the sales agents during any selling period or otherwise determine such maximum amount together with the sales agents. Each sales agent will receive from us a commission of up to 3.0% of the gross sales price of all common shares sold through it as sales agent under the Distribution Agreement. In connection with the sale of common stock, each of the sales agents may be deemed an "underwriter" within the meaning of the Securities Act, and the compensation paid to the sales agents may be deemed to be underwriting commission.
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The sales agents are not required to sell any specific number or dollar amount of our common shares but will use their commercially reasonable efforts, as our agents and subject to the terms of the Distribution Agreement, to sell the common shares offered, as requested by us.
We intend to use the net proceeds of any offering, after deducting the sales agents’ commissions and our offering expenses, for general corporate purposes. This may include, among other things, additions to working capital, repayment or refinancing of existing indebtedness or other corporate obligations, financing of capital expenditures, and acquisitions and investment in existing and future projects. As of the date hereof, the Company has neither sold or undertaken to sell any shares pursuant to the Distribution Agreement. The Company has no obligation to sell any shares and may at any time suspend offers under the Distribution Agreement or terminate the Distribution Agreement.
The following is a summary of the significant capital allocation and strategic fleet optimization activities we have executed so far during 2026 and sources of capital we have at our disposal for future use as well as the Company’s current commitments for future uses of capital:
Returns to Shareholders
During 2026, the Company’s Board of Directors declared and paid the following dividends:
Declaration Date | Record Date | Payment Date | Total Dividends per Share | Total Dividends Paid |
February 25, 2026 | March 20, 2026 | March 30, 2026 | $2.15 | $106.4 million |
May 6, 2026 | June 12, 2026 | June 26, 2026 | $4.55 | $225.3 million |
On August 7, 2026, the Company’s Board of Directors declared cash dividends of $5.05 per share of common stock, payable on September 24, 2026 to stockholders of record as of September 10, 2026.
Fleet Renewal and Growth
We executed the following fleet renewal and growth transactions:
| ● | Completed the sales and deliveries to buyers of one 2007-built MR, four 2008-built MRs, one 2010-built VLCC, and one 2012-built VLCC for net proceeds of $222.4 million. |
| ● | Acquired all of the outstanding capital stock of TUKA, a privately-held joint venture between the Company and CMB.Tech, which serves as the commercial manager for the VLCC pool company – TIL, for a total purchase consideration of $10.0 million (which includes the fair value of our previously held equity interest in TUKA). |
| ● | Took delivery in March 2026 and April 2026 of the third and fourth of six LR1 newbuildings under construction in Korea with K Shipbuilding Co., Ltd. The remaining two LR1s are expected to be delivered during the third quarter of 2026. The aggregate contract price for the six scrubber-fitted, dual-fuel ready LR1 vessels is approximately $359 million. As of June 30, 2026, the Company has approximately $73 million in remaining construction costs, all of which is expected to be drawn from the ECA Credit Facility in accordance with the delivery schedule. |
| ● | Entered into contracts to build an additional four, scrubber-fitted, dual-fuel (LNG) ready, LR1 vessels in Korea with K Shipbuilding Co, Ltd., which are expected to be delivered in the second half of 2028. The aggregate contract price for the four LR1s is approximately $244 million. The Company expects to finance the newbuildings through a combination of long-term financing and available liquidity. As of June 30, 2026, no payments have been made in connection with the contracts. Upon delivery, these vessels are expected to deliver into our niche, Panamax International Pool, which has consistently outperformed the market. |
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As of June 30, 2026, the Company has contractual commitments for the construction of four dual-fuel ready LR1s and the purchase and installation of various performance efficiency devices for the fleet. The Company’s debt service commitments and aggregate purchase commitments for vessel construction and betterments as of June 30, 2026 (excluding the construction contracts for two of the additional four dual-fuel ready LR1s that were executed in July 2026), are presented in the Aggregate Contractual Obligations Table below.
Outlook
Our strong balance sheet, as evidenced by a substantial level of liquidity, 25 unencumbered vessels as of June 30, 2026, and diversified financing sources with debt maturities spread out between 2030 and 2038, positions us to support our operations over the next twelve months as we continue to advance our vessel employment strategy, which seeks to achieve an optimal mix of spot (voyage charter) and long-term (time charter) charters. Our balance sheet strength and balanced fleet position us to continue pursuing our disciplined capital allocation strategy of fleet renewal, incremental debt reduction and returns to shareholders and pursue potential strategic opportunities that may arise within the diverse sectors in which we operate.
Aggregate Contractual Obligations
A summary of the Company’s long-term contractual obligations as of June 30, 2026 follows:
Beyond | |||||||||||||||||||||
(Dollars in thousands) | 2026 | 2027 | 2028 | 2029 | 2030 | 2030 | Total | ||||||||||||||
$500 Million Revolving Credit Facility(1) | $ | 1,305 | $ | 2,339 | $ | 2,010 | $ | 1,671 | $ | 125 | $ | — | $ | 7,450 | |||||||
$160 Million Revolving Credit Facility(1) | 442 | 811 | 730 | 161 | — | — | 2,144 | ||||||||||||||
TISL Borrowing Base Facility(2) | 8,741 | — | — | — | — | — | 8,741 | ||||||||||||||
ECA Credit Facility - floating rate(3) | 8,038 | 15,928 | 15,600 | 15,197 | 14,814 | 162,300 | 231,877 | ||||||||||||||
2030 Bonds - fixed rate | 8,906 | 17,812 | 17,812 | 17,813 | 267,813 | — | 330,156 | ||||||||||||||
BoComm Lease Financing - fixed rate(4) | 11,978 | 23,761 | 23,827 | 23,762 | 142,272 | — | 225,600 | ||||||||||||||
Toshin Lease Financing - fixed rate(4) | 1,080 | 2,151 | 2,223 | 2,052 | 2,052 | 2,829 | 12,387 | ||||||||||||||
Hyuga Lease Financing - fixed rate(4) | 1,116 | 2,232 | 2,160 | 2,160 | 2,256 | 2,000 | 11,924 | ||||||||||||||
Kaiyo Lease Financing - fixed rate(4) | 1,292 | 2,214 | 2,214 | 2,214 | 2,127 | — | 10,061 | ||||||||||||||
Kaisha Lease Financing - fixed rate(4) | 1,107 | 2,214 | 2,214 | 2,214 | 2,287 | — | 10,036 | ||||||||||||||
Operating lease obligations(5) | |||||||||||||||||||||
Office space and vessel equipment |
| 658 | 1,406 | 1,260 | 1,185 | 1,104 | 2,602 | 8,215 | |||||||||||||
Vessel and vessel betterment commitments(6) | 85,445 | 18,240 | 91,200 | — | — | — | 194,885 | ||||||||||||||
Total | $ | 130,108 | $ | 89,108 | $ | 161,250 | $ | 68,429 | $ | 434,850 | $ | 169,731 | $ | 1,053,476 |
| (1) | Amounts shown include unused revolver capacity commitment fees. |
| (2) | The TISL Borrowing Base Facility, which is repayable on demand, bears interest at SOFR plus 2% and is secured by a fixed and floating charge over current and future freight and demurrage receivable, freights in transit and any other fees relating to vessels in the TISL pool. |
| (3) | Amounts shown include unused commitment fees and contractual interest obligations on $164.7 million of outstanding floating rate debt estimated based on the applicable margin for the ECA Credit Facility of 1.1% and the fixed rate stated in the interest rate swaps (assigned for hedge accounting purposes) of 2.84% through the swap maturity date of February 22, 2027 for $63.6 million; the effective three-month SOFR rate of 3.67% as of June 30, 2026 was used for the remaining outstanding principal under the ECA Credit Facility. |
| (4) | Amounts shown include contractual implicit interest obligations of the lease financing under the bareboat charters. |
| (5) | The full amounts due under office space leases are discounted and reflected on the Company’s consolidated condensed balance sheet as lease liabilities with corresponding right of use asset balances. |
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| (6) | Represents the Company’s commitments for the purchase and installation of various performance efficiency devices for the fleet, and the remaining commitments for the construction of four dual-fuel ready LR1s. |
Risk Management:
The Company is exposed to market risk from changes in interest rates, which could impact its results of operations and financial condition. The Company manages this exposure to market risk through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. To manage its interest rate risk exposure associated with changes in variable interest rate payments due on its credit facilities in a cost-effective manner, the Company, from time-to-time, enters into interest rate swap, collar or cap agreements, in which it agrees to exchange various combinations of fixed and variable interest rates based on agreed upon notional amounts or to receive payments if floating interest rates rise above a specified cap rate. The Company uses such derivative financial instruments as risk management tools and not for speculative or trading purposes. In addition, derivative financial instruments are entered into with a diversified group of major financial institutions in order to manage exposure to nonperformance on such instruments by the counterparties.
At June 30, 2026, there have been no material changes in the information disclosed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations —Risk Management” and “— Interest Rate Sensitivity” set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Available Information
The Company makes available free of charge through its internet website, www.intlseas.com, its Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as soon as reasonably practicable after the Company electronically files such material with, or furnishes it to, the Securities and Exchange Commission.
The SEC maintains a web site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at https://www.sec.gov.
The Company also makes available on its website, its corporate governance guidelines, its Code of Business Conduct and Ethics, insider trading policy, anti-bribery and corruption policy, incentive compensation recoupment policy, and charters of the Audit Committee, the Human Resources and Compensation Committee, Sustainability and Safety Committee and the Corporate Governance and Risk Assessment Committee of the Board of Directors. The Company is required to disclose any amendment to a provision of its Code of Business Conduct and Ethics. The Company intends to use its website as a method of disseminating this disclosure, as permitted by applicable SEC rules. Any such disclosure will be posted to the Company website within four business days following the date of any such amendment. Neither our website nor the information contained on that site, or connected to that site, is incorporated by reference into this Quarterly Report on Form 10-Q.
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ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
As of the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on that evaluation, the Company’s management, including the CEO and CFO, concluded that the Company’s current disclosure controls and procedures were effective as of June 30, 2026 to ensure that information required to be disclosed by the Company in the reports the Company files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There was no change in the Company’s internal control over financial reporting during the three months ended June 30, 2026 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
See Note 15, “Contingencies,” to the accompanying condensed consolidated financial statements for a description of the current legal proceedings, which is incorporated by reference in this Part II, Item 1.
Item 1A. Risk Factors
In addition to the other information set forth below in this Quarterly Report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our 2025 Form 10-K and in Part II, Item 1A “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026. The risks described in those documents are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
No stock repurchases were made during the three and six months ended June 30, 2026 other than shares withheld to cover tax withholding liabilities relating to the vesting of outstanding restricted stock units or the exercise of stock options held by employees and certain members of management.
See Note 11, “Capital Stock and Stock Compensation,” to the accompanying condensed consolidated financial statements for additional information about the stock repurchase plan and a description of shares withheld to cover the cost of stock options exercised by certain members of management and tax withholding liabilities relating to the vesting of previously-granted equity awards to certain members of management, which is incorporated by reference in this Part II, Item 2.
Item 4. Mine Safety Disclosures
Not applicable.
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Item 5. Other Information
Insider Trading Arrangements and Policies
On
The Zabrocky Plan was adopted in accordance with our insider trading plan policy. Actual sale transactions will be disclosed publicly in filings with the SEC in accordance with applicable securities laws, rules, and regulations.
Except as disclosed above, during the second quarter of 2026, none of our directors or executive officers adopted Rule 10b5-1 trading plans and none of our directors or executive officers terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).
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INTERNATIONAL SEAWAYS, INC.
Item 6. Exhibits
1.1 | Distribution Agreement dated May 11, 2026 among the Registrant and BTIG, LLC, B. Riley Securities, Inc., Clarksons Securities, Inc. and Fearnleys Securities, Inc. (filed as Exhibit 1.1 to the Registrant’s Current Report on Form 8-K dated May 11, 2026 and incorporated herein by reference). | |
*10.1 | Form of Amendment No. 10 to Lois K. Zabrocky’s Employment Agreement filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated June 8, 2026 and incorporated herein by reference. | |
*10.2 | Form of Amendment No. 8 to Jeffrey D. Pribor’s Employment Agreement filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated June 8, 2026 and incorporated herein by reference. | |
*10.3 | Form of Amendment No. 9 to James D. Small III’s Employment Agreement filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated June 8, 2026 and incorporated herein by reference. | |
*10.4 | Form of Amendment No. 10 to Adewale O. Oshodi’s Employment Agreement filed as Exhibit 10.4 to the Registrant’s Current Report on Form 8-K dated June 8, 2026 and incorporated herein by reference. | |
**31.1 | | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended. |
**31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended. | |
**32 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
EX-101.INS | Inline XBRL Instance Document | |
EX-101.SCH | Inline XBRL Taxonomy Extension Schema | |
EX-101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |
EX-101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |
EX-101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |
EX-101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |
EX-104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
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INTERNATIONAL SEAWAYS, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
INTERNATIONAL SEAWAYS, INC. | |
(Registrant) | |
Date: August 10, 2026 | /s/ Lois K. Zabrocky |
Lois K. Zabrocky | |
Chief Executive Officer | |
Date: August 10, 2026 | /s/ Jeffrey D. Pribor |
Jeffrey D. Pribor | |
Chief Financial Officer |
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