International Seaways Posts Record Profit as Tanker Rates Surge
International Seaways swung to record quarterly free cash flow of $261 million as spot tanker rates jumped roughly $51,500 a day year over year.
International Seaways (INSW) reported record net income of $295 million, or $5.91 a diluted share, for the second quarter of 2026, up from $286 million a quarter earlier and more than four times the $62 million the shipping company earned a year ago.
The results extend a run of accelerating gains that began in late 2025. Net income has climbed each quarter since the fourth quarter of 2025, when it stood at $128 million, and adjusted EBITDA has followed the same path, rising to a record $345 million in the latest quarter from $244 million in the first quarter and $102 million a year earlier, a 238% year-over-year increase.
Shipping revenues reached $467 million, up from $325 million in the prior quarter and $196 million a year ago, a 138% increase, while time-charter-equivalent revenues rose to $434 million from $189 million. The gains came despite fewer vessels in the water: total revenue days fell 17% to 5,446 from 6,570 a year earlier, partly reflecting the company's sale of seven older vessels earlier in 2026. Average spot earnings across the fleet rose roughly $51,500 a day year over year, an acceleration from the roughly $30,000 average increase reported in the first quarter.
Both of the company's segments contributed. Crude Tankers generated $253 million in TCE revenue, up from $99 million a year earlier, with spot earnings above $64,500 a day and time-charter earnings around $75,700 a day reflecting higher profit-sharing. Product Carriers TCE revenue rose to $181 million from $90 million, driven by spot earnings of about $42,600 a day. The revenue mix tilted further toward the spot market: voyage charter revenues surged to $123 million from $10 million a year earlier, while pool revenues grew more moderately, to $256 million from $149 million.
Free cash flow hit a quarterly record of $261 million, beating the prior high by nearly $100 million and up sharply from $71 million a year ago. International Seaways used the cash to keep expanding its fleet, contracting four additional LR1 newbuildings for $244 million, with delivery set for 2028, adding to a newbuild program that already totaled six vessels and $359 million. No new vessel sales were disclosed in the quarter, a shift from the steady disposals of older tonnage that ran from the third quarter of 2025 through the first quarter of 2026.
The balance sheet strengthened alongside earnings. Net loan-to-value improved to about 6% at June 30 from below 7% at the end of March and roughly 13% at the end of 2025, while total liquidity rose to about $935 million from $918 million a quarter earlier, though it remained below the $985 million reported last September.
International Seaways raised its quarterly dividend to a record $5.05 a share, payable in September, up from $4.55 a share paid in June and $2.15 a share paid in March. The payment marks the third consecutive quarter with a payout ratio of at least 85% of adjusted net income, a policy the company adopted at the start of 2026 after five straight quarters under a 75% minimum through the third quarter of 2025. Over the six months ended June 30, total dividends paid reached $6.70 a share, more than triple the $2.15 a share paid in the comparable period.
G&A expense rose 36% to $16.6 million from $12.2 million a year earlier, outpacing a roughly flat depreciation and amortization line of $39.7 million versus $41.3 million.