Pyxis Tankers Inc. (PXS) Misses Q4 EPS by 4c, Revenues Miss

Pyxis Tankers Inc. (NASDAQ: PXS) reported Q4 EPS of ($0.12), $0.04 worse than the analyst estimate of ($0.08). Revenue for the quarter came in at $4.5 million versus the consensus estimate of $5.26 million.

Valentios Valentis, our Chairman and CEO, commented:

“The chartering environment for product tankers in the fourth quarter of 2020 continued to be depressed, reflecting no seasonal rebound in the northern hemisphere due to the continued negative impact of COVID-19 on the demand for refined petroleum products. Through our short-term time charters, we were able to achieve an average TCE of $12,291/day for our MRs during the quarter, which was disappointing, but generally better than rates that could have been achieved in the spot market.

The short-term demand outlook for our sector continues to be difficult. However, we are encouraged by signs of expanding economic activity. The rebound started in Asia last fall and positive signs of recovery have recently become evident in the west. In January, the IMF revised upward its 2021 global outlook for GDP growth to 5.5%. The softening of government lockdowns in the U.S. and Europe from the most recent surge of the virus is a welcome relief. The growing availability of effective vaccines cannot be understated. Inventories of refined products should reach 5 year averages soon, especially after the conclusion of many refinery maintenance programs and demand returns for transportation fuels as we move into summer and worldwide economic activity expands. During this challenging environment, we have continued to focus our employment strategy for our MRs on shorter-term, staggered time charters to mitigate risk and provide predictable cash flow. As of March 19, 2021, we had booked 100% of available days for the first quarter of 2021 at an average rate of approximately $13,200 per day for our MRs and 75% of available days during Q2, 2021 at a similar level.

During these arduous times, we have concluded some important operating and financial objectives. In the second half of 2020, we completed special surveys on three of our vessels. We have no major scheduled drydockings until 2023 when the Pyxis Theta undergoes her second special survey with BWTS installation. Over the last five months, we have raised $30 million of equity capital in two financings. In October, we completed a $5 million offering of units consisting of convertible preferred shares and detachable warrants to purchase common stock over a five year period. Both of these securities have a strike price of $1.40 per share. The net proceeds of $4.3 million from this public offering were used for working capital and debt repayment. In February 2021, we completed a $25.0 million private placement offering by selling 14.28 million common shares at $1.75 per share to institutional investors. The net proceeds of $23.1 million are expected to be used for similar purposes as well as opportunistic vessel acquisitions in the clean products sector. Also, this past week we signed a commitment letter with one our banks to refinance the outstanding debt for the Pyxis Epsilon. We will combine $7.5 million of cash with a new 5 year loan of $17 million to reduce overall leverage, lengthen our debt maturities and obtain an interest rate savings of 7.5%. Our stronger financial position should help us take advantage of opportunities to grow our company in an accretive manner. As economies are gradually exiting lockdowns and solid global GDP growth kicks in, this should result in rising demand for the seaborne transportation of a broad range of petroleum products. In the meantime, the supply picture continues to look better due to the continued low ordering of new tankers and the likely increase of scrapping of older tonnage. Overall, we maintain a positive outlook about the long-term prospects for the product tanker sector.”

For earnings history and earnings-related data on Pyxis Tankers Inc. (PXS) click here.

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