Torm (NASDAQ:TRMD) Issues Quarterly Earnings Results

Torm (NASDAQ:TRMD) released its quarterly earnings data on Wednesday. The company reported $1.91 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.55 by $0.36, Zacks reports. The business had revenue of $499.40 million for the quarter, compared to the consensus estimate of $330.95 million. Torm had a return on equity of 27.24% and a net margin of 35.51%.

Here are the key takeaways from Torm’s conference call:

• Q3 earnings rose substantially year over year: TCE earnings were $353 million, EBITDA was $274 million and net profit was $199 million. Average fleet TCE was about $40,100 per day, though earnings were lower than in the exceptional second quarter.
• TORM raised the low end of its full-year guidance by $50 million: It now expects TCE earnings of $1.75 billion–$1.9 billion and EBITDA of $1.35 billion–$1.5 billion, citing strong Q4 coverage and market expectations.
• Management sees supportive tanker-market fundamentals: Q4 bookings included rates of about $78,000 per day across vessel classes, while the company said the fleet actively trading clean products had contracted roughly 4% year to date despite growth in the nominal fleet. It also pointed to potential demand from inventory rebuilding.
• Shareholders will receive a $1.35-per-share interim dividend, totaling $138 million, at a 78% payout ratio. TORM reported a 25.9% net loan-to-value ratio, which management said already includes committed newbuilding investments.
• Fleet investment commitments are substantial: The company cited about $650 million of committed newbuilding CapEx and plans for additional MR and LR2 vessels. Management also emphasized that shipping is cyclical and freight-market conditions can change quickly.

Torm Trading Down 6.5%

TRMD traded down $2.62 on Wednesday, hitting $37.64. The company had a trading volume of 2,450,148 shares, compared to its average volume of 1,036,543. The company has a market cap of $3.84 billion, a PE ratio of 6.20 and a beta of 0.05. Torm has a 12-month low of $19.30 and a 12-month high of $43.31. The company has a quick ratio of 1.97, a current ratio of 2.27 and a debt-to-equity ratio of 0.33. The business’s fifty day simple moving average is $37.21 and its 200 day simple moving average is $30.75.

Torm Cuts Dividend

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, December 2nd. Investors of record on Tuesday, November 17th will be issued a $1.35 dividend. This represents a $5.40 dividend on an annualized basis and a dividend yield of 14.3%. The ex-dividend date of this dividend is Tuesday, November 17th. This is a negative change from Torm’s previous quarterly dividend of $2.40. Torm’s payout ratio is 115.49%.

Wall Street Analysts Forecast Growth

TRMD has been the subject of a number of research reports. Evercore reiterated an “outperform” rating on shares of Torm in a research report on Tuesday, October 27th. Weiss Ratings upgraded shares of Torm from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Friday, October 9th. Finally, Wall Street Zen raised shares of Torm from a “buy” rating to a “strong-buy” rating in a research note on Saturday, September 19th. One equities research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating and one has issued a Hold rating to the company. According to data from MarketBeat, Torm currently has an average rating of “Buy” and an average price target of $38.00.

Insiders Place Their Bets

In other Torm news, CFO Kim Balle sold 7,533 shares of the company’s stock in a transaction that occurred on Tuesday, September 22nd. The stock was sold at an average price of $36.35, for a total transaction of $273,824.55. Following the sale, the chief financial officer directly owned 510 shares in the company, valued at $18,538.50. This represents a 93.66% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this link. Insiders sold 42,533 shares of company stock worth $1,643,225 over the last quarter. Insiders own 0.37% of the company’s stock.

Torm Company Profile

TORM plc is a maritime transportation company that owns and operates a fleet of product tankers. The company primarily transports refined petroleum products, including gasoline, diesel, jet fuel and naphtha, connecting refineries, storage facilities and distribution markets around the world.

TORM’s fleet serves the global clean-product tanker market and includes vessels in several size categories, such as long-range and medium-range tankers. Its vessels operate on international trade routes, supporting the movement of energy products between major production and consumption regions.

Founded in Denmark in 1889, TORM has grown into an international shipping company headquartered in Copenhagen.