Teekay Tankers Ltd. (NYSE:TNK) Q2 2022 Earnings Conference Call August 4, 2022 11:00 AM ET

Company Participants

Christian Waldegrave - Director of Research

Stewart Andrade - Chief Financial Officer

Conference Call Participants

Jon Chappell - Evercore

Omar Nokta - Jefferies

Ken Hoexter - Bank of America

Operator

Welcome to the Teekay Tankers Ltd Second Quarter 2022 Earnings Results Conference Call. During the call, all participants will be in a listen-only mode. Afterwards, you will be invited to participate in a question-and-answer session. [Operator Instructions] Thank you. As a reminder, this call is being recorded.

Now, for opening remarks and introductions, I would like to turn the call over to the company. Please go ahead.

Unidentified Company Representative

Before we begin, I would like to direct all participants to our website at www.teekaytankers.com where you will find a copy of the second quarter 2022 earnings presentation. Stewart will review this presentation during today's conference call.

Please allow me to remind you that our discussion today contains forward-looking statements. Actual results may differ materially from results projected by those forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the first quarter 2022 earnings release and earnings presentation available on our website.

I will now turn the call over to Stewart Andrade, Teekay Tankers' CFO to begin.

Stewart Andrade

Thank you, [Ed]. Hello, everyone, and thank you very much for joining us today for Teekay Tankers second quarter 2022 earnings conference call. Joining me on the call today are Christian Waldegrave, Director of Research; and Mikkel Seidelin, Director of Chartering and Freight Trading. Kevin is attending to a personal matter at the moment, but sends his best. For today, I’ll be leading the call.

Moving to our recent highlights on Slide 3 of the presentation, Teekay Tankers generated total adjusted EBITDA of approximately $58 million in the second quarter of 2022, an increase of approximately $41 million from the first quarter of 2022. We reported an adjusted net income of nearly $26 million or $0.76 per share during the second quarter, an improvement from an adjusted net loss of $14 million or $0.41 per share in the prior quarter.

Our improved results quarter-over-quarter were primarily due to higher spot tanker rates. In the improving tanker market environment, which I will address shortly, Teekay Tankers is benefiting from our high operating leverage with 49 vessels currently trading in the spot market. This is enabling us to strengthen our balance sheet after weathering almost two years of a weak tanker market. Both our liquidity and our balance sheet leverage are moving in the right direction and that remains a key focus for us.