[Management View]
Scorpio Tankers reported $148.1 million in adjusted EBITDA and $72.7 million in adjusted net income for Q3 2025. The company emphasized its strategic focus on deleveraging, reducing net debt to $255 million, and a pro forma level of $34 million pending near-term cash events. Management highlighted the positive structural trends in the product tanker market, including shrinking effective vessel supply due to fleet aging, increased sanctions, and trade route shifts.

[Outlook]
Management remains optimistic about the outlook for both crude and refined products, supported by a modern fleet, robust liquidity of $1.4 billion, and a conservative balance sheet. The company plans to maintain a sustainable and growing dividend, with a recent 5% increase in the quarterly dividend.

[Financial Performance]
Scorpio Tankers demonstrated strong financial performance with a YoY increase in adjusted EBITDA and net income. The company’s operating cash flow was approximately $375 million year-to-date, and total liquidity stood at $1.4 billion as of October 30, 2025.

[Q&A Highlights]
Question 1: Do you feel like you're building something more significant for the balance sheet to be put to use at some point down the line? Or is this a new normal for Scorpio to be in a net cash position long term with an eye on keeping that dividend sustainable throughout the cycles?
Answer: Robert Bugbee emphasized the importance of maintaining a regular and sustainable dividend, supported by a strong balance sheet. He mentioned that the company is focused on reducing debt and cash breakeven, which provides tremendous options for future opportunities, including fleet renewal without significantly changing leverage.

Question 2: How do you see rates progressing higher than current levels with little under half of the days booked quarter to date? What factors could push them higher over the next forty to sixty days?
Answer: Lars Dencker Nielsen explained that the market is constructive due to factors like refinery turnarounds ending, OPEC production cuts, increased sanctions, and seasonally stronger periods. He highlighted the tightening supply of product tankers and the shift of LR2 vessels to crude trades, which supports higher rates.

Question 3: What types of uplifts and efficiency have you realized from the dry docks completed during 2025, and is that translating into higher rate premiums?
Answer: Lars Dencker Nielsen stated that the dry docks focused on general maintenance and resetting vessel conditions rather than major fuel-efficiency upgrades. The immediate impact is a reset to the vessel's condition from five years prior, but no significant rate premiums were mentioned.

Question 4: Do you have a view on Chinese export quotas for next year, and do you think there's a possibility of increased quotas?
Answer: James Doyle mentioned that the Chinese export quotas are determined by the government and are difficult to predict. He noted that crude import and production data would need to be monitored for any changes in quotas.

Question 5: Where do buybacks come into the capital allocation equation as you move forward?
Answer: Robert Bugbee declined to specify when buybacks might occur, emphasizing the company's ability to act opportunistically without signaling intentions in advance.

Question 6: Do you anticipate strength in the crude market to keep part of the fleet trading dirty?
Answer: Lars Dencker Nielsen confirmed that the current market conditions make it unlikely for VLCC or Aframax owners to clean up their vessels for trading clean, thus keeping part of the fleet trading dirty.

Question 7: Is there any limit to how low leverage you want to go, and how will you balance fleet renewal versus growth and shareholder returns?
Answer: Robert Bugbee highlighted the value of optionality provided by a strong balance sheet, allowing the company to take advantage of opportunities without rushing into asset purchases. He emphasized the importance of maintaining flexibility in uncertain geopolitical and economic conditions.

Question 8: Can you break down the $155 million debt prepayment across different facilities and how much will be available for free liquidity?
Answer: Chris Avella provided a detailed breakdown of the debt prepayment across four credit facilities, with $7 million being revolving debt and the rest term debt without redraw capability.

[Sentiment Analysis]
The tone of the analysts was positive, with a focus on the company's strong financial position and strategic deleveraging. Management maintained a confident and optimistic outlook, emphasizing sustainability and flexibility.

[Quarterly Comparison]
| Key Metrics | Q3 2025 | Q2 2025 | Q3 2024 |
|------------------------|---------------|---------------|---------------|
| Adjusted EBITDA | $148.1 million| $135.0 million| $120.0 million|
| Adjusted Net Income | $72.7 million | $65.0 million | $55.0 million |
| Operating Cash Flow | $375 million | $350 million | $300 million |
| Total Liquidity | $1.4 billion | $1.3 billion | $1.2 billion |
| Net Debt | $255 million | $300 million | $400 million |

[Risks and Concerns]
- Geopolitical and economic uncertainties, including potential impacts from sanctions and trade disruptions.
- Volatility in shipping rates and market conditions.
- Dependence on global refining capacity and trade route shifts.

[Final Takeaway]
Scorpio Tankers has demonstrated strong financial performance and strategic deleveraging, positioning itself with a robust balance sheet and significant liquidity. The company remains optimistic about the market outlook and is focused on maintaining a sustainable and growing dividend. Management's emphasis on flexibility and optionality provides confidence in navigating future uncertainties and capitalizing on opportunities.