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The call emphasized strong operational and financial results, with record-high near-term rate coverage, upgraded full-year guidance, rising broker valuations and continued disciplined fleet renewal — all supported by a conservative balance sheet. These positives are tempered by significant geopolitical disruptions (Strait of Hormuz closure), reduced global trade volumes, vessel dislocations, sanction-driven effective capacity loss and a USD ~30 million working capital build that reduced the reported payout ratio. Management positions the company as well placed to benefit from a structural market reset but acknowledges material uncertainty and volatility risks.
Management upgraded full‑year 2026 guidance, now targeting TCE of USD 1.15–1.45 billion (up from USD 850–1,250m) and EBITDA of USD 800–1,100 million (vs. prior USD 500–900m), underpinned by a strong Q1 (TCE USD 286m, EBITDA USD 201m, net profit USD 122m, EPS USD 1.21) and exceptional Q2 coverage: 57% of earning days fixed at a fleet‑wide TCE of USD 71,494/day (Q2 bookings to date above USD 70,000/day across sizes). Fleet metrics include 95 vessels at quarter end (rising to 103 on a fully delivered basis after six MR resales—4 in 2027, 2 in 2028), average Q1 fleet TCE USD 34,937/day (LR2 >USD 41k/day, MR ~USD 33k/day, LR1 ~USD 35k/day), broker fleet valuation USD 3.6bn, NAV USD 3.1bn, net interest‑bearing debt USD 894m (net LTV 25.1%), dividend USD 0.70/share (58% payout; would be ~80–85% absent a ~USD 30m net working capital build), and the quarter guidance is presented with a +/- USD 7,500/day TCE sensitivity and remains subject to market volatility and geopolitical developments.
TCE of USD 286 million in Q1 2026, EBITDA of USD 201 million and net profit of USD 122 million (EPS USD 1.21), representing a marked improvement versus the same quarter last year and the strongest quarterly result since Q2 2024.
Fleet-wide average TCE of USD 34,937/day; LR2 earnings > USD 41,000/day, LR1 ~ USD 35,000/day and MR just under USD 33,000/day — materially higher than year-ago freight levels.
Full-year guidance raised to TCE USD 1.15 billion–USD 1.45 billion (previously USD 850m–USD 1.25b) and EBITDA to USD 800 million–USD 1.1 billion (previously USD 500m–USD 900m), reflecting strong start to 2026 and high near-term visibility.
57% of Q2 earning days already secured at a fleet-wide average TCE of USD 71,494/day, with Q2 average bookings to date above USD 70,000/day across vessel sizes — providing substantial near-term earnings visibility.
Broker valuations for the fleet at USD 3.6 billion and net asset value increased to USD 3.1 billion; average broker valuations rose 9.7% during Q1, with strong appreciation in LR2 and LR1 segments.
Net interest-bearing debt of USD 894 million and net loan-to-value ratio of 25.1%; debt maturities well-distributed beyond USD 287 million maturing in the next 12 months, preserving financial flexibility.
Fleet of 95 vessels at quarter end; committed acquisition of 6 MR resales (4 delivering in 2027, 2 in 2028) will increase fleet to 103 vessels on a fully delivered basis — focus on younger tonnage and preserving age profile.
Board declared a dividend of USD 0.70 per share with a payout ratio of 58% (would have been ~80%–85% absent a USD ~30 million net working capital build), demonstrating a capital return framework balanced with liquidity considerations.
Safety-first operations with only 1 vessel inside the Persian Gulf at quarter end; crew reported in good condition and provisions secure despite regional disruptions.
Management reports a multi-year operating advantage: MR fleet generated approximately USD 200 million more TCE than peer average over a 3-year period due to higher utilization, disciplined cost control and centralized management platform.
Thank you for standing by. My name is Angela, and I will be your conference operator today. At this time, I would like to welcome everyone to the TORM First Quarter 2026 Conference Call. [Operator Instructions] I would now like to turn the call over to Mr. Jacob Meldgaard, CEO, you may begin.
Thank you, and welcome to everyone joining us today. We started 2026 with a very strong first quarter, delivering results that demonstrate both the earnings power of our platform and the strength of our execution in a supportive freight market. This morning, we released our Q1 2026 results, and we are pleased with the performance. However, before I go into the details of the quarter, I would like to take a step back and briefly talk about TORM and the foundation that underpins these results and continues to differentiate us in the market. Again, our performance was driven by a combination of strong freight rates, disciplined execution and the One TORM platform. While we remain attentive to global developments, we continue to align ourselves with market changes and believe we have a unique ability to react quickly to movements in spot prices. This is something we are often asked about. The answer is that it represents a quantifiable advantage over our peers, what we refer to as the One TORM advantage.
It is now embedded in the way we operate and is a capability our competitors would undoubtedly like to replicate. Importantly, this advantage is the result of a journey over many years, a journey that continues to evolve. We are able to track this across a range of performance indicators. ...
