Tsakos Energy Navigation Ltd (TEN) 2007 Q1 法說會逐字稿

Good morning. My name is Nelson and I will be your conference operator today. At this time, I would like to welcome everyone to the Tsakos Q1 2007 earnings conference call. All lines have been placed on mute prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. (OPERATOR INSTRUCTIONS).

It is now my pleasure to turn the floor over to your host, Tom Rozycki. Sir, you may begin your conference.

Good morning and thank you for joining us for Tsakos Energy Navigation's first-quarter 2007 earnings conference call. By now, you should have received a copy of the earnings press release. If you have not, please contact Laura Kowalcyk of CJP Communications at 212-279-3115, extension 209, and she will be happy to fax or email a copy of the release to you.

Again this quarter, we are also providing a supplemental slide presentation, which can be accessed from the front page of TEN's website at www.tenn.gr. As a reminder, this conference call is also being webcast. To access the webcast, please refer to the press release for the Web address, which will direct you to the registration page.

At this time, I would like to read the Safe Harbor statement. This conference call and the accompanying slide presentation contain certain forward-looking statements within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, which may affect TEN's business prospects and results of operation. Such risks are most fully discussed in TEN's filings with the Securities and Exchange Commission.

Thank you. At this time, I would like to turn the call over to Mr. Nikolas Tsakos, President and CEO of Tsakos Energy Navigation.

Thank you, Tom. Good morning or good afternoon, ladies and gentlemen. Thank you for being on our call and listening to our results, to our first-quarter record results again today. I would like to welcome everybody and introduce our Chairman, who is here, Mr. Stavropoulos; Mr. Saroglou, our COO; Mr. Durham, our CFO; our Chief Marine officer, Vladimir Jadro, who is also here. And I'll ask our Chairman to also give us his thoughts, and then I will talk a little bit about the financials, more on operational and chartering issues, and then Paul Durham will be giving, in much more detail, our financial results for the quarter.

So Mr. Chairman, to you, please.

Thank you very much. Good morning, everyone. Nikol has given me the permission to digress and be a little philosophical today. And as a result, I want to focus on the goals and achievements which ultimately are the drivers of investment performance. Highly successful companies are not built in a day, nor by a single person. It takes years of dedication, vision, sound strategies and consistent execution. Of course, it also takes a pinch of good luck and strong leadership.

TEN is certainly not an overnight success, but the legal entity was incorporated in the late 1993 and immediately listed on the Oslo Stock Exchange. Since that time, it has grown in both size and stature from a four-vessel operation with a capital base of $35 million to a fleet of 53 ships and a market cap in excess of $1.1 billion.

The technical manager, Tsakos Shipping and Trading, or TST, was formed in 1970 by Captain Panagiotis Tsakos. Since 1993, TEN and TST have grown in tandem with a common goal. That goal is the development of a world-class transporter of energy products. I think we can all agree that that fundamental goal has now been fulfilled, but the vision has moved to a new horizon. The new goal is to build the very best, highest-quality and most profitable transporter for energy products. This is indeed a very ambitious goal. Can they do it? Stay tuned.

Meantime, TEN's goals have been consistent with the delivery of exceptional shareholder rewards. The record shows an internal rate of return of 36.8% since the New York Stock Exchange listing and IPO in March of 2002. This compares with 7.4% for the S&P. The latest 12 months -- I hesitate to give you these numbers -- the return for TEN has been 73.6% -- this is total return -- versus 23.2% for the S&P.

Nevertheless, these great results disguise the fact that TEN's shares still sell at a discount to theoretical liquidation value. I expect the outstanding operating performance will be the catalyst that drives future shareholder reward. In the interim, on behalf of the Board of Directors and I presume all the proud shareowners, I want to congratulate the entire Tsakos team for yet another outstanding quarter.

Nikolas, thank you very much. All I can say is keep up the wonderful work.

Chairman, thank you very much for your kind words. We will be keeping busy. The first quarter of '07 was a very busy, productive and challenging period for TEN in both operational and commercial matters. The final result represents another record, and it is our 54th consecutive profitable quarter in our 54 quarters of existence. So this is something we are quite proud of.

I will very quickly give a quick overview of our results and then concentrate on commercial and operational performance. And I think that we have an online presentation -- you can look a summary of our financials on slides 11 and 12.

Our revenues for the first quarter of '07 were $115 million. That was a 20% increase over the $96 million that we booked in '06. Our net income rose to $43.5 million from $41.8 million last year. And our earnings per share from $2.28 this year are up from $2.19 in the first quarter of last year. These record numbers were achieved although utilization was lower due to the drydockings and conversions of some of our vessels, but they reflected a positive and stable environment in the marketplace and a balanced chartering policy that we are demanding.

Operationally, the first quarter was one of the busiest quarters so far. Seven newbuildings entered our fleet since the beginning of the year. And this has added 700,000 dead-weight tons capacity to our fleet and has further reduced the average age of our ultramodern fleet, and if you look on slide 5, you will see a presentation of our well-balanced fleet portfolio.

We took delivery of two ice-class vessels in the Suezmax category, the Arctic and the Antarctic, which currently are operating on the spot market, quite happily. And these are the largest vessels in their category in the world today, which is the largest 1A ice-class Suezmaxes.

Again, on the ice-class side, on the product, we took delivery of three product carriers, the Andromeda, the Aegeas and the Byzantion. And the ships were immediately chartered to major traders as soon as they left the yard with a minimum rate of an average of $20,000 a day, plus a profit split above that for the next three years.

And of course, then we have the delivery of our new design, Aframax, the Izumo Princess, and it's on a positioning voyage in the Mediterranean, coming straight from Japan at a very accretive rate.

Also in the first quarter has marked for us the official entrance of this Company to the ever-growing LNG trade. We will deliver with our vessel, the Neo Energy, which was delivered from [Shedai Cad] Industries and straightaway fixed to [Cartal Gas], the largest exporter of gas in the world, and has already performed two very successful voyages that make us very happy and proud with the performance on that segment, on this new segment of the market.

On the sales and purchase side, during the first quarter, we also sold our oldest double vessel, the Bregen, which was built in 1989. We made a $6.5 million [sic --- see press release] capital gain, and we further reduced the average age of our modern fleet to 5.4 years. And of course, this continues our strategy of using the sales and purchase market as a vital part of our revenue growth. And on slide 9, you will see in the last three years, on a quarterly basis, that we participated in this market very actively. On average, $0.50 of our net income on a quarterly basis comes from our sales and purchase production. So it is something that we are, as you will hear later, going to be implemented even further as we speak -- as we go forward.

We have 10 modern newbuildings to take delivery. And as you see on slide 8, four of those ships are going to be taking delivery this year. And this gives us the tonnage to examine new offers that we have in sending some of our first-generation newbuilding vessels at prices almost twice what we ordered those vessels 10 years ago. And this will result in a capital gain that will further enhance our bottom line.

So our strategy is to continue modernizing our fleet. So we have very good performance in our first-generation newbuildings. However, at this stage, when we are seeing, because of the market being so interesting and long term, we are seeing offers that make it very difficult for us not to sell some of those very good older ships.

Commercially, the quality of our full double/double fleet, coupled with strong market expectations, has allowed us to demand our chartering policy with great efficiency. And you can see the mix of our historicals on slide number 6, the mix of our chartering policy.

The continued appetite for all our vessels from first-class charters has further increased. And this is a very encouraging sign for the future. This has allowed us to maintain a balanced chartering policy with a long-term plan-driven strategy always in mind.

Three of our newbuilding ice-class product carriers have been chartered for three years, [ex-yard], at very accretive minimum rates with a 50/50 profit split. The Victory and the Hesnes, or Panamax tankers, have been fixed and delivered already to Petrobras at very accretive fixed rates. And our new ice-class Suezmaxes and Aframax, operating in the spot market since delivery; however, in essence, we are fighting offers for chartering those ships for long-term deployment by major oil companies.

The market environment since the beginning of this year, 2007, has started with mixed signals in the market. We faced a warmer-than-usual winter and we've had plenty of newbuilding supply to control. However, China's and India's unstoppable thirst for oil and the West and the United States driving season, coupled with lower inventories, have balanced the market very well. The long-term prospects remain positive -- major oil companies, which is a very strong indicator for us, they are our clients -- are out to cover their requirements forward for three to 10 years, which is a very positive sign.

Just to gives you ballpark figures of where the rates have been and are today, the [rio tesist] in the West have averaged, since the beginning of the year, $45,000 a day, $40,000 in the East -- that's since January. Today, the market is closer to $50,000 a day. The Suezmaxes had their best March ever, or one of their best [seasons] ever, and [renovated] and exceeded the $120,000 trading in the Mediterranean in March. Today, they average about $60,000 at the beginning of the year.

The Aframaxes averaged $40,000 in the West, $30,000 in the East, so they have been proven very steady. And the products, due to low inventories and the driving season, have increased significantly, and they have averaged since the beginning of the year $30,000 a day. The above-market performance also compares very well with what is available for long-term time charter employments. Someone could fix today one VLCC in excess of $55,000 for one year, a Suezmax approaching $50,000. Aframax was done today at $35,000 for a year. And the [product spending], depending on the size, anywhere between $27,000 and $30,000. The availability of business from first-class charterers and end users is very reassuring for us.

On the corporate front, as the Chairman mentioned, we celebrated our fifth anniversary on the New York Stock Exchange and 14 years as a public company. And the Company has continued its impressive growth. And you can see our growth on slide 4, for growth that goes on for 54 quarters.

We started with a little less than a profit of $4 million in 2002. We booked a profit of $197 million for '06. And hopefully, we're looking for much more in '07. Our dividend grew from $0.70 to $2.75, and according to our Chairman, still growing. And all this has had a significant increase on our share price, from $9 in August of '03, which was I think our low period, to, I was very happy to see today, in excess of $64 as we are speaking today. And you can see a chart in the presentation of our performance on slide 13.

However, [really] we think that is a very impressive performance. We believe it is a very impressive performance ourselves. But as our Chairman said, we have quite a way to go before the true value of our Company is represented. The management and the Board will work even harder to achieve this for all our shareholders, and ourselves being the largest shareholder, we will be glad to start looking at three-digit numbers at some stage. And we will work to that goal.

We want to thank all of you for your support as our shareholders. And I [more than] want to thank our on-board and on-land personnel in Tsakos Shipping and Trading, our technical managers, for allowing us to boast such a performance with 24/7 very responsible and flawless service.

Looking forward to see as many of you as possible in Greece for our annual general meeting. There is an invitation on slide 15. And we promise that that will be a very interesting time for you, and we would like to welcome you here.

So I would like to ask Paul to give you a little bit more details on the numbers. And we will be back for your questions. Thank you very much.

Thank you, Nikolas, and thank you all for joining us today. Before I begin, please note that a summary of selected financial data is included in the press release for your reference, and I would like now to talk about more significant items occurring during the quarter.

TEN achieve net income of $43.5 million in quarter one 2007 compared to $41.8 million in quarter one 2006. Diluted and basic earnings per share was $2.28 based on 19 million average shares compared to $2.19 based on 19.1 million shares in quarter one 2006.

Total revenue was just over $115 million compared to nearly $96 million in quarter one 2006. This was mainly due to the significant increase in the size of the fleet from an average of 27.1 vessels in quarter one 2006 to 37.7 vessels in quarter one 2007. The change in the fleet between the start of 2006 and the end of quarter one 2007 has been dramatic. Three older vessels and one modern vessel were sold, and 19 new vessels acquired, increasing tonnage from 2.9 million tons to 4.5 million tons. Also, the average age fell to 5.4 years, making it one of the youngest fleets. Indeed, if we ignore the three VLCCs, the average age of the other 37 vessels is only 3.9 years.

Vessel utilization fell from 99.2% of available days last year to 94.4% this quarter one. Vergina II was in drydock for conversion all quarter. The Propontis was under repair for nearly two months in quarter one. And the LNG carrier Neo Energy undertook equipment testing and crew training for several weeks. To a lesser degree, quarter two will also be affected by these factors.

The trading profile of the fleet has continued to change. The number of days employed on time charters with profit share increased from 416 to 1688, the percentage from 17% to 53%. In contrast, days on fixed rate time charters fell from 29% to 22%. And time spent on spot, [contracted at freightment and cool] employment, all spot-related freights, decreased from 54% to 25% of total days. Since early January, we have no vessels in the pool.

Partly as a reflection of these changes, voyage expenses decreased from [$68.7] million to $14.7 million. It was also gratifying to see bunker prices come down some 10% from last year's quarter one.

Average daily TCE per vessel fell from $33,100 to $31,650. However, reported rates for VLCCs, Panamaxes and Handysize vessels were affected by accounting rules during quarter one, because in the case of profit sharing based on six-month averages, we may only account for minimum rates until the average is known. We had seven vessels to which this rule applied, of which for six, the average for the preceding six months will be determined in quarter two, and therefore the profit share for all six months accounted for in quarter two.

In general, however, rates achieved in the quarter were better than expected, especially in the Suezmax and Aframax categories, which both earned on average approximately $40,000 a day. The smaller product carrier categories earned between $20,000 and $23,000. The VLCCs and Panamaxes were also earning approximately $40,000 and $30,000, respectively. But in each case, because of the minimum rule, the average accounted for was approximately $10,000 a day less in quarter one to be taken account of in quarter two.

Total operating costs increased from $14.5 million in quarter one 2006 to $22.7 million in quarter one 2007, partly due to the extra vessels and due to an average increase of 5% on costs. The daily average cost is increasing since last year's quarter one from $6931 to $7292 in quarter one 2007.

Besides the increase in the average size of our vessels and general inflation, approximately half the increase is due to the impact of a 9% weakening of the dollar on the cost of our euro-paid vessel officers. Much of the remainder of the increase is due to heavy repair work on six specific vessels, primarily the older ones. Otherwise, costs in other categories have been held to a reasonable level or even reduced.

G&A expenses were about $300,000 in quarter one 2007 due to extra audit-related fees and merger expenses. And management fees were up from $1.4 million to $2.2 million, due both to the increase in the size of the fleet and also to an increase in the fee rate. Taking these two items together on a daily basis per vessel, these overhead costs were up from last year from $773 per day in quarter one 2006 to $889 per day in quarter one 2007, or to $1173 if the stock compensation expense is included. Compensation expense related to the issue of 300,000 stock grants distributed to staff of the commercial and technical managers, Company directors and officers, and vessel officers, 180 persons in total.

These costs will amount to approximately $13 million to be amortized until the units vest -- for the most part, 50% at the end of 2008 and the remaining 50% at the end of 2010. $1 million was amortized in quarter one. From quarter two, amortization will be $1.2 million per quarter in 2007 and '08 and $400,000 per quarter in 2009 and '10. The minority interest earned by the shareholders of 49% of the Company owning the Panamaxes Maya and Inca was approximately $500,000 during the quarter.

Income earned in quarter one on bank deposits and investments was nearly $6 million, including an unrealized gain of $3.5 million on the conversion to shares of the convertible bond. Total finance costs for the quarter amounted to $15.5 million compared to $3.6 million in quarter one 2006, mainly due to increased interest rates and the average outstanding loans rising from $553 million in quarter one 2006 to $1.2 billion in quarter one 2007, and this is due to fleet growth.

During quarter one, we added $197 million to our total debt to partly finance the new deliveries within the quarter. This moved our total debt to $1.33 billion and our net debt to capital ratio to 59.7% at the quarter end.

We have taken delivery of seven new vessels to date this year and will take delivery of another 10 vessels over the next three years, on which there is a $418 million amount remaining to be paid -- $132 million in the rest of 2007, $95 million in 2008, $108 million in 2009, and $83 million in 2010. Bank debt is expected to finance much of this remaining capital expenditure.

Within quarter two, earnings will benefit from the Vergina II reentering service as a double-hull food carrier, the Propontis being back in service as from yesterday, the delivery of the Suezmax Antarctic, the product carriers Aegeas and Byzantion, and the Aframax Sakura Princess, and of course, by the six-month profit share on the six vessels I have mentioned. More information on delivery dates and profit share arrangements may be found on our website.

And this concludes my comments, and now I will hand the call back to Nikolas.

Thank you, Paul, for the very detailed analysis of our financials. And I think with this opportunity, we would like to open the floor to any questions or comments you may have. Thank you very much.

(OPERATOR INSTRUCTIONS). Jon Chappell, JPMorgan.

You gave some good detail on the fleet and the developments so far this year, taking seven ships -- very front-end-loaded. I know you still have 10 ships left on the delivery schedule. But as we go out into the out years, '09, '10, the deliveries start to fall a little bit.

Can you explain a little bit how you're looking at future newbuilds versus the secondhand market? Do you find that, given that the order book is being pushed out into next decade and that dry bulking containers are taking a fair amount of the slots for that time horizon, that maybe secondhand tonnage may be a more prudent way to expand the fleet going forward?

Thank you very much. As you know, we are always looking at opportunities. We have participated mainly by organic growth through our newbuildings. However, we have bought -- we bought the nine less than a year ago. Less than a year ago, we bought the Western fleet and made other transactions in the secondhand market. So we do not exclude the secondhand market.

However, the relationship we have with the shipyards always gives us opportunities. Right now, because of the demands of the dry cargo and container market, mainly on the Capesize market, we are seeing, which I feel it's a good development, a lot of slots taken away from tankers. So they are using our supply, future supply, and putting it on the dry cargo and container markets.

However, there are always opportunities from the yards, and we are exploring them. So we will not exclude anything. We have another, as I said, a significant -- four ships to take in this year and six ships from now until the end of 2009. And I'm sure we're going to continue being busy. We will look at secondhand opportunities. However, right now, just to give you an example, our 1998-build Aframaxes, we can sell them at a minimum of $60 million. With the same exact money, we can order, for 2009 or '10, a newer version of the vessel. And that is what we have done consistently, and we might consider selling some of the older ships rather than being buyers of expensive secondhand vessels.

If you were to sell some of those older ships and the slots weren't available in the newbuild yards, wouldn't you say that maybe delevering the balance sheet after this big newbuilding program in 2007 would be your first use of cash? Or do you think that, given your comments and the Chairman's comments, that your stock is still trading significantly below liquidation value, that share buyback may be a use of proceeds from the sale of the 1990-build ships?

I would say a combination of both, with more focus on the balancing, although we see how the conservative balance it -- debalancing it and allowing us to look at the opportunities. We do not exclude opportunities of fleets, and because that will be immediate growth, and we're always looking at that.

And one last one for Paul. Paul, can you explain a little bit more that $3.5 million unrealized gain on conversion of shares to the convertible bond? Is that something that will be in the interest income line going forward, or is that really a one-time benefit?

That is -- what will happen -- what happened in quarter one is we converted the convertible bond to shares within quarter one. And because we had previous valuation gains held in the other comprehensive income line on the balance sheet, by converting it to shares, we could take the gains all through to income.

Those shares have now been sold as part of a mandatory offer by the company that is taking over the company in which we had the shares. So we are in fact selling those, and we will see, I estimate, approximately another $0.5 million gain within quarter two. And that will be the end of the story.

And just one last one, Paul. What is a good interest expense run rate to look at going forward? Your first-quarter number was significantly below our estimate. And I don't know if that was timing of taking on debt with the delivery of the ships, or if that was maybe some swap gains or something that is a little bit more difficult (multiple speakers)

Let me give you an analysis of the number. I think that is probably the best way to answer your question. Our actual interest on the loans was approximately $18.7 million. We're talking about an interest rate of about 6%. Then we had the benefit of our swaps. That brought in actual cash of $3 million, bringing our total interest -- net interest level to $15.7 million and our effective all-in interest rate at about 5.6%.

And then we had the benefits of capitalized interest, another $2.6 million, bringing our total interest now down to about $13.1 million. And that capitalized interest will gradually decline over the next two or three years as our building program comes to an end. We had a negative valuation on our swaps, strangely enough. Although we were actually receiving $3 million worth of cash, the actual value of the swaps at the quarter end went down by $2 million. So that had a negative impact. And then we had about $0.5 million worth of loan amortization charges and general commitment fees, etc. So that brings it down to $15.5 million.

So going forward, yes, you should be looking at our average loans per quarter, and an effective all-in interest rate of between 5.6% and 6%, and with some positive effects from the capitalized interest for the next year or so.

That was very helpful, Paul, and thanks a lot (multiple speakers)

And another thing I should mention is that all the time, we are negotiating with the banks to bring the margins down. So we are in a continuous process of loan repricing -- that hopefully will bring our average loan expense down. We are now looking at new loans and repricing loans above 50 basis points.

Thank you, Paul, and thanks for your comments today.

Natasha Boyden, Cantor Fitzgerald.

Congratulations on a great quarter. I just want to start off with the Neo, I believe, the LNG carrier, Neo Energy. You chartered her out in April on a 40- to 60-day voyage. Just really wanted to know what the plans were for that. Do you have a long-term contract set up, or are you going to continue operating on a short-term contract?

As we speak today, there are contracts in the pipeline which we are discussing. A lot of them are big businesses, which we are looking. There are businesses that are positioned out for about 10 to 15 years, which are not very attractive. I would have to say we became very enthusiastic, actually, going out and doing the whole operation -- doing our first two voyages, seeing the quality of the ships, and the impression it has made to the first charterers, who are willing to recharter our ship again for a medium or bigger this time.

So I think we see this market start giving us five-year time charter equivalents in the mid-60s. We will keep on doing what we're doing because the rates are quite good. We are taking them, and we're learning lots more about this market. However, when and if an opportunity comes, I think we will be looking to do something anywhere between three and five years.

But it is a very small club of [warmers], very small club of charterers. We are all very excited participating in this and getting our hands on this business by making money at the same time, which is very nice.

Yes, that is always helpful. And then just moving on to the ice-class vessel segment, given it was pretty warm during the winter, did you recognize any ice-class premiums during the past winter season?

As you know, we have in our vessels and in our profit shares, we have -- our ice-class ship has specific ice-class route. And there was a period around February and March where we had significant gains of this profit-sharing, mainly in our aftermarket, which accounted to [Nestoil]. I think they were earning twice what the market was earning for two months. And I think that was something like $60,000 to $65,000 for the Aframaxes and about $45,000 [for the 53,000] Handymaxes that we have.

So yes, we were surprised ourselves, because we have this -- the icing on the cake, as we say, but we saw a good performance in what was a quite warm winter.

Good to hear. And then just lastly, and you may have said this on the call, and I apologize if you have -- can you give us your drydocking schedule for the rest of '07 and '08?

We have -- the four sister Suezmaxes will be drydocked this year. They will be enjoying a very special survey.

In which quarter is that, Paul?

The Cape Baker will be in quarter three, coming up, and the Cape Balboa in quarter four. Now, both of these vessels, the cost will be borne by the owner. We will not be paying chartering during this period. But also, we will do that on the potential (multiple speakers) could be earning during this period.

And then we have Silia, which is coming up in quarter two -- at the end of this quarter and into quarter three. And the fourth sister, the Triathlon, at the end of the year, quarter four.

We have the VLCC La Prudencia also in quarter three. And that is it for the quarter. What we shall also possibly try and do is bring it forward into this year, hopefully one or two of the vessels which are scheduled for the following year, because the following year is quite a busy year.

(OPERATOR INSTRUCTIONS). Daniel Burke, Johnson Rice.

I had just one question left for Paul. It was a clarification on the profit-sharing based on six-month averages for the seven vessels. Paul, did you say that those are scheduled to pay out during Q2 and hence did not pay out during Q1? Or I guess what I am trying to ask is can you describe the impact of those profit shares, if any, in the first quarter?

If we take, for example, a VLCC, for instance, those are on a minimum of $28,800. That is all we accounted for within the first quarter because the final determination of the six-month average won't happen until June. When that determination happens, and let's for the sake of argument say they determine that the $40,000 a day was the average for the whole six months, then on that day in June, we can book for the six months -- let's say 180 days -- that extra $12,000 a day.

So very, very roughly speaking, because we don't know until determination happens, I would estimate that we have taken about $0.25 worth of profit from quarter one and put it into 2007. I said we -- I say the accounting rules, I should say. And also, indeed, a few cents from quarter four of last year will go into quarter two. Does that clarify things?

Yes, that clarifies it very well. Thank you for that.

There appear to be no further questions at this time. I'd like to turn the call back to management for any closing comments.

Thank you very much for your attention. And thank you for making today a new record high for our share price, and we will keep on doing this, hopefully, in the future as much as possible. And please don't forget, on the final slide of the presentation is the invitation for our annual meeting in Athens on the 31st, 2PM in the afternoon. We would like very much to have you. And please feel free to call us. Our schedule for conference and [entertainment policy, Mr. Hansford Markos], will be available to take down the names of whoever will come, and we would love for you to see the Company, visit one of our ships, and also receive Tsakos' great hospitality. Thank you very much.

Thank you. This does conclude today's Tsakos Q1 2007 earnings conference call. You may disconnect at this time, and have a wonderful day.