Scorpio Tankers Reports Strong Q1 2026 Results, Hikes Dividend and Expands Buyback Program

Robust Earnings Growth and Enhanced Shareholder Returns

Scorpio Tankers Inc. (NYSE: STNG) reported a significant earnings jump for the first quarter of 2026, with net income of $216.26 million—more than triple the $58.21 million from the prior year period. Diluted earnings per share climbed to $4.32, up from $1.22 in Q1 2025.

Adjusted net income, which excludes gains on vessel sales and other non-core items, reached $150.86 million, or $3.02 per diluted share. The company’s board declared a quarterly cash dividend of $0.45 per share, its highest yet, payable on June 15, 2026. This marks continued momentum in Scorpio’s capital returns, following four dividend raises since early 2025.

Parallel to the dividend hike, the board authorized the replenishment of its securities repurchase program, now totaling $500 million. As of May 5, 2026, the full amount was available for buybacks, providing substantial flexibility to return value to shareholders amidst strong financial results.

Strong TCE Revenue Supported by High Tanker Rates

Scorpio’s performance was buoyed by exceptional market conditions for product tankers. Time Charter Equivalent (TCE) revenue for Q1 2026 stood at $303 million, up from $204.2 million in Q1 2025, despite the fleet size decreasing from 99 to 91 vessels. The average daily TCE rate per vessel surged to $37,697, up 57% year-over-year, reflecting robust demand, longer voyage distances, and regional trade disruptions.

Balance Sheet Strength: High Liquidity and Lower Leverage

Liquidity continues to be a highlight for Scorpio, with $1.4 billion in unrestricted cash and $711.8 million of undrawn revolver capacity as of May 1, 2026. Pro forma net cash stands at $875.85 million, a notable increase from $395.27 million a year earlier. The company further diversified its funding by issuing $375 million in convertible senior notes with a 1.75% coupon, maturing in 2031, and used the proceeds to repurchase over 1.34 million shares at $74.36 each.

This robust financial profile positions Scorpio to weather volatility and invest strategically in its fleet, as evidenced by ongoing vessel transactions and newbuilding projects.

Fleet Optimization and Future Growth: Active Vessel Sales and Newbuilding Orders

Scorpio Tankers continues to streamline and renew its fleet. Since March 2025, the company has sold or agreed to sell 11 vessels, including both LR2 and MR product tankers, raising capital for new, more efficient ships. Notably, vessel sales in March and April 2026 are expected to yield net proceeds of nearly $400 million. At the same time, Scorpio committed to order additional LR2 and MR newbuilding vessels, with deliveries scheduled from 2026 through 2029, as well as two VLCCs in 2028.

Remaining newbuilding payments as of May 1, 2026, are estimated at $641.5 million. The move to modernize the fleet is designed to ensure competitiveness and meet evolving industry and environmental standards.

High Charter Rates Provide Earnings Visibility

Looking ahead to the second quarter of 2026, average daily TCE rates remain well above historical norms, especially for LR2 vessels projected at $96,000 per day on the pool and spot market. MR and Handymax vessels command $66,000 and $61,000 per day, respectively, for the same period. This supports strong near-term earnings visibility, even as the company continues its asset optimization strategy.

Key Takeaways: Positioned for Continued Strength

Scorpio Tankers’ Q1 2026 performance reflects a shipping market firing on all cylinders, with tanker rates and asset values supporting record profits and substantial cash generation. Strategic moves—including the expanded buyback program, higher dividend, and prudent fleet management—underline management’s confidence and forward-looking approach. Investors may wish to watch the upcoming webcast and call for further insight on operational strategy and market outlook.

The company’s focus on liquidity, leverage, and operational efficiency provides a strong foundation for navigating industry cycles and capitalizing on emerging trends.

Conference Call Details

Date: May 5, 2026
Time: 9:00 AM EDT / 3:00 PM CEST
Web: Scorpio Tankers Q1 2026 Webcast

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