Thank you for standing by, ladies and gentlemen, and welcome to Tsakos Energy Navigation conference call on the fourth quarter and year-end 2020 financial results. We have with us Mr. Takis Arapoglou, Chairman of the Board, Mr. Nikolas Tsakos, President and CEO, Mr. Paul Durham, Chief Financial Officer, and Mr. George Saroglou, Chief Operating Officer of the company. At this time, all participants are in a listen-only mode. There'll be a presentation followed by a question and answer session, at which time, if you wish to ask a question, please press star one on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today, Wednesday, the 24th of March 2021. I now pass the floor to Mr. Nicolas Bornozis, President of Capital Link, investor relation advisor of Tsakos Energy Navigation. Please go ahead, sir.
Thank you very much, and good morning to all of our participants. I am Nicolas Bornozis of Capital Link, investor relations advisor to Tsakos Energy Navigation. This morning, the company publicly released its financial results for the fourth quarter and the year ended December 31st, 2020. In case you do not have a copy of today's earnings release, please call us at 212-661-7566 or email us at ten@capitallink.com and we will have a copy for you emailed right away. Please note that parallel to today's conference call, there is also a live audio and slide webcast, which can be accessed on the company's website on the front page at www.tenn.gr. The conference call will follow the presentation slides, so please, we urge you to access the presentation slides on the company's website.
Please note that the slides of the webcast presentation will be available and archived on the website of the company after the conference call. Also, please note that the slides of the webcast presentation are user-controlled, that means that by clicking on the proper button, you can move to the next or to the previous slide on your own. At this time, I would like to read the Safe Harbor statement. This conference call and slide presentation of the webcast 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 some business process and results of operations. At this moment, I would like to pass the floor to Mr. Arapoglou, the Chairman of Tsakos Energy Navigation. Mr. Arapoglou, please go ahead.
Thank you, Nicolas. Good morning and good afternoon to all, and thank you for joining us today. I hope you're all staying safe and healthy. Despite the challenging market conditions, 2020 proved to be a year of strong operating profitability for TEN. This allows us to continue paying dividends, repaying yet another issue of preferred stock, reduce bank debt, and meet all our other obligations. In addition, we sold older tonnage to maintain a young fleet and were able to take non-cash corrective action on certain vessels. In essence, nothing new or different from what TEN has been consistently doing every year since inception.
Today, with a substantial cash position, accelerated special surveys to best utilize poor market conditions, and half the fleet on spot, TEN is perfectly positioned to benefit from the anticipated recovery in the global economy and the resulting release of pent-up demand for oil and for oil products. The board joins me in congratulating Nikolas Tsakos and his team for yet another year of best-in-class performance, which fully validates our strategy. With this, I pass the floor to Nikolas Tsakos.
Thank you, Chairman. Good morning to all of you on the other side of the Atlantic, and good afternoon to you here in Europe. Thank you for joining our call. It was exactly a year ago to the day where our Chief Operating Officer set the exact same date for our call. When we were talking back on the 24th of March of 2020, we were in the beginning of this pandemic, and everything looked very new, very strange, and we were all at a loss. A lot has gone under the bridge since then. Unfortunately, a huge loss of life worldwide. It is really a different world than we entered exactly a year ago, our call today. However, as the Chairman said, we were able to navigate these difficult times, maintaining, as hard as it was, a steady hand on the wheel.
We are coming out of what has been a very troubling period in very choppy waters or stormy waters, to say the least, in calmer waters, helped a lot by the vaccinations that are happening all over the world. In my last call in November, when we announced the nine-month results, I was hoping that we would not have hit a third or whatever the number is, new wave of lockdowns around the world. Unfortunately, it has happened. It is still happening. In some parts of the Western world, things are becoming more difficult as far as the pandemic. However, at the end of the tunnel, we have the light, which are the vaccines. A big percentage of the population, hopefully, will be vaccine by the end of this and the next quarter.
This medical miracle that happened in a very short period of time has given the world a new go-around, and this is something we are seeing in the rates as of the beginning of the year. 2020 was a roller coaster year. Things are looking more positive. The natural supply and demand equilibrium right now is very tight, and we saw it even last night and this morning when the Suez Canal, and this was not an April Fool's Day event, it was the real closure, and it's still partially closed of the Suez Canal that has put the market through the roof, mainly in futures rates. We have been able to renew a fleet as Mr. Arapoglou said, our Chairman. We sold seven vessels. We got new environmental-friendly four vessels and, in the meantime, added two new buildings.
All of the six new vessels that we have already delivered or will be delivered are chartered with long accretive rates. In the last quarter, a lot of attention has been made to recharter nine vessels, three of them being our LNGs. In a different market environment, we are very proud that the LNGs and all our tankers keep on ticking without a day loss. That has been a really remarkable achievement from the commercial and technical side, and I would like to thank them going forward. We are seeing significant signs that we are much closer to stronger rates. We are seeing the peer markets, dry cargo and containers skyrocketing at levels that we have not seen for at least 12 years, back in 2007 and 2008. We expect that the V-shape tanker rate recovery is not far.
We have kept our vessels significantly in the spot market. We have 31 ships ready to take immediate advantage of that turnaround and another 12 vessels with profit-sharing arrangement. The company is maintaining its profitability, is maintaining its dividend policy during very difficult times. It's reducing debt significantly. We're looking at a much healthier picture by the next quarter. With this, I will ask our COO, Mr. George Saroglou, to give us a little bit more details of what we have been seeing and what we are facing as we speak. I will be there for answers if you need anything. Thank you.
Thank you very much, Nikos, and good morning to all of you joining our earnings call. We report today a profitable year for the 2020 operations. In fact, a 40% increase in profitability from 2019. 2020 has been a roller coaster year for the tanker industry and the world because of the COVID-19 pandemic and its economic, social, and health-related repercussions. We continue to successfully navigate the logistic and regulatory challenges of COVID-19 with no impacts to our operations so far. This has been the biggest challenge of the last 12 months and continues to be the number one priority. Because of the pandemic, the lockdowns, border closures, and reduced airline capacity, the shipping industry has experienced significant challenges with timely crew changes.
We continue to safely perform crew changes, but problems with restrictions and logistics remain as different parts of the world open and close their borders asynchronously following virus developments. We want to take the opportunity to thank one more time all our seafarers and the onshore personnel for their hard work, patience, dedication, and professionalism during this unprecedented time. We will continue to work hard to normalize crew changes and bring seafarers safely back home to their families without disrupting the operational readiness and efficiency of the fleet. This has been and will continue to be the number one priority until crew changes and crew repatriation return to the pre-COVID normality. Let us go to the slides of our presentation. In slide three, we see that since TEN's inceptions in 1993, we have faced four major crises.
Each time, the company, thanks to its operating model, which is built to be crisis resistant, has come out stronger. From four modern vessels in 1993 to a pro forma fleet of 70 vessels for an average 15% annual growth in terms of deadweight tons in the four decades we operate. This time has not been an exception. Last year, we sold seven tankers with an average age of 14 years and replaced them with four eco design, environmentally friendly new buildings built in South Korea, two suezmax and two aframax tankers that were chartered to an oil major on minimum five-year contracts with options that go up to 10 years. The last of the four series order has been delivered to charterers last quarter.
The company continues the current growth program with constructions of two vessels in the specialized shipping sectors, namely the DP2 shuttle tankers and LNG, that both have already been fixed to long-term employment. In slide four, we see the pro forma fleet and its current fleet profile, employment profile. We have a combination of vessels in fixed-time charters and flexible employment contracts, time charters with profit-sharing, COAs, and spot trading that capture the market upside. All dark blue color vessels, 23 in the slides, are on fixed rate time charters, while the light blue and red color vessels or more than 2/3 of the fleet currently in the water have exposure in the market upside. This means that TEN is well-positioned to capture the positive tanker market fundamentals and the expected recovery of freight rates that we expect to be seeing from the second half of this year.
The left side presents on the next slide. On slide five, the left side presents the all-in break-even cost of the various vessel types we operate. As you can see, the cost base is low. In addition to the low shipbuilding cost, we must highlight the purchasing power of Tsakos Columbia Shipmanagement, the continuous cost control efforts by management to maintain a low operating expense average for the fleet, and the low general and administrative expenses while keeping a very high fleet utilization rate quarter after quarter. We almost had 95% utilization for the year after bringing forward a special survey of nine vessels to take advantage of a weaker market.
Thanks to the profit-sharing element, that is a big part of our fleet, we enjoy the benefits when the market conditions are strong, like the freight markets that we have witnessed during the first half of the year. As demand for oil continues to recover from the lows of last year and oil inventories continue to fall, we expect the freight market to recover from current levels. For every $1,000 increase in spot rates, we have a positive impact of $0.60 in annual EPS based on the number of TEN vessels that currently have exposure to spot rates. Debt reduction in slide six is an integral part of the company's capital allocation strategy. During last year, we have repaid $160 million of debt and repurchased the successful $50 million Series C Preferred Shares. Our net debt to capital ratio is currently below 50%.
In addition to paying down debt, growing the company through timely sale and purchase and new building acquisitions, we have continued to reward our shareholders with dividend payments. We announced today a $0.10 per share dividend for common shareholders that will be paid in June. Since our listing in New York Stock Exchange in 2002, we have rewarded the company shareholders with almost half a billion in dividend payments and $113 million in share buybacks. Besides debt repayments, cash dividends, and buyback of common and Preferred Shares, which are the three main pillars of the company's capital allocation, fleet growth and renewal is the fourth pillar. As far as the market is concerned, it has been an unprecedented year for global oil demand last year because of the COVID-19 pandemic and the measures to contain it.
2020 was the first year of negative growth since the period of the Great Recession in 2008 and 2009. Year-end demand was down by approximately 8.8 million barrels per day from the year-end 2019 numbers or approximately 8% of demand. Most of the losses are in jet aviation fuel. The expectations for 2021 are for oil demand to grow back by 5.5 million barrels per day. We are on a growth trajectory for oil demand and full recovery to the pre-COVID-19 levels depends more or less on how quickly global jet fuel demand will return to the pre-COVID-19 levels, and of course, on how quickly and how well the world will manage the vaccine rollouts and the latest virus mutations.
Nearly all demand reductions are found in the OECD countries, while non-OECD countries or non-OECD world continues to have strong demand growth and the International Energy Agency continues to increase the demand expectation for China and India as their economy recovers and demand continues to grow. Non-OECD countries continue to be the growth engine for oil demand. On the supply side, OPEC+ producers are gradually easing unprecedented production cuts. There is an additional 7.7 million barrels per day of shut-in production that OPEC+ plans to gradually restore over the course of the next year. Compliance with these cuts continues to be very high. Oil inventories in OECD countries continue to draw. The expected demand growth of 5.5 million barrels per day of this year and OPEC+ gradual oil production increases should be very positive for tanker demand and tanker rates.
While oil demand continues to grow, let us look at the forecast for the supply of tankers. The order book as of February stands at around 353 tankers or 7.5% of the fleet, is expected to be delivered over the next year, which is the lowest that we have seen in almost 30 years. However, we should notice that we have a big part of the fleet that is over 15 years. We are talking about 1,410 vessels. Almost 8% of the fleet are currently at or above 20 years. With the upcoming environmental regulations, we expect to see a push for more tankers approaching or above 20 years to go for scrapping. 2018 was the highest scrapping year of records. Last year was lower as expected. We expect to see a pickup thanks to the big part of the fleet that continues to be over 15 years.
We would expect a pickup in scrapping from this year as more environmental regulations are on the horizon and a weak market for the last nine months creates an unfavorable trading environment for those vessels that approach or are currently at above 20 years. In summary, on the oil demands, the recovery continues to be strong, and this strong recovery is going to be translated into 5.5 million barrels per day growth in 2021. On the supply of oil, production increases, we believe, are on the horizon by both OPEC+ and other non-OPEC producers. On the vessel supply, the order book to the current fleet ratio is at historical low levels, which implies at minimum a balanced market for the next 18 to 24 months. Regarding TEN's balance sheet, we have a crisis-resistant proven operating model.
We have a modern fleet well-positioned to capture the positive market development, which we expect from the second half of 2021. We have a strong balance sheet and strong banking relationships that will allow the company to take advantage of the opportunities as they will be presented. To the expectation of better days ahead, we conclude the operational part of the presentation. Paul will walk you through the financial highlights for the fourth quarter and the full year.
Well, thank you, George. Well, as we've been emphasizing, TEN had a profitable year in 2020, generating in total net income of over $59 million before non-cash charges, mainly vessel impairments. Revenue in 2020 rose to an annual record $644 million for TEN, mainly due to the strong demand for floating storage in the year. We had 94% utilization in 2020 and even 91% in quarter four, which are good signs given that we had nine dry dockings in the year. Average daily TCE in the year was $23,600, a respectable average compared to market rates, boosted by profit share totaling $47 million in the year. EBITDA increased to $267 million, of which $33 million was in quarter four, both significantly contributing to cash reserves by the year-end, despite the $50 million redemption of the Series C preferred stock.
In quarter four, revenue fell by $44 million compared to the prior quarter four, indicating a weakening of the market in the latter part of the year and contributing to a quarter four net loss for TEN of just over $14 million, before non-cash impairments of over $15 million in the quarter. Even given these conditions, TEN, with half the fleet on time charter, successfully avoided potentially significant losses. Our time charter still provided the cash to cover nearly all OpEx, G&A, and finance costs, with vessels on spot providing a further $12 million to cover the shortfall. Our costs were kept at stable levels, expense categories being similar to the previous year and quarter despite dry dockings, with average daily OpEx per vessel for the quarter and year up slightly to $7,800, partly due to dry dockings and a weaker dollar.
Quarter four finance costs fell by $4.5 million, with interest falling nearly $5 million, mainly due to lower interest rates, our cost of debt remaining below 3%, and due to reduced loan margins and shrinking outstanding debt, while positive bunker hedge valuations rose by $4 million. We sold five vessels to third parties in 2020, generating $94 million and prepaid $54 million of loans, freeing $40 million of cash. We shall be looking for further sales to consider over the next 18 months. We have an LNG carrier and shuttle tanker being built for a total of over $280 million, of which we have paid $65 million to date and have arranged related pre-delivery financing at excellent terms for the ships, as both have charters that will generate lucrative cash flow from delivery.
Another $384 million net in scheduled repayments and loan prepayments were made in the year, while new debt for delivered vessels in 2020 and recent pre-delivery debt and loan refinancing amounted to over $340 million. Bringing total debt down to $1.51 billion, with net debt remaining at 48%. Given the current state of the tanker market, it may seem difficult to expect any major recovery in the near term. There are, in our opinion, some strengthening positive stirrings, as both George and Nikos have said, on the horizon. We do expect the outlook to be positive from mid-year on and in the meantime, our time charters will hold the fort, just as they did in quarter four and are doing in quarter one. This concludes my comments, I'll pass the call back to Nikos.
Thank you, Paul, for your detailed analysis of the results. As we said, next year is going to be our 20th year as a public company on the New York Stock Exchange, and we hope we will maintain our continuous dividend payment and profitability as we have always done. It seems that the prospects going forward are quite positive for a very strong recovery, similar to what we are seeing in other segments of the industry. Usually, the tankers follow the dry cargo and the container market, and this is happening as we speak, where we see unprecedented high levels for demand as infrastructure building is going back, and it's happening. The same is evident a lot on the product carriers. A lot of refineries are shutting down in the Western world, and more demand for products is required around the world.
A lot of coal mines are being reduced in places like China, that helps our LNG and fuel imports in these vast markets. India, at the same time, is importing more and more from the West, or at least from places like West Africa and it's not so dependent anymore on the Middle East, increasing ton miles as we go forward. The normal contenders like Libya, who has been a big participant of the Mediterranean market, has increased since our last presentation in November, another 16%. Its output. Everything helps, and more importantly than anything else is the lack of supply. Very small, single-digit supply coming in over the next two years as we speak. I think we are looking at a significant super cycle happening here sooner rather than later.
At the same time, we are seeing large conglomerates like Equinor, which is one of our largest also clients, coming in and starting to work on what they say is the largest so far oil field in the North Sea, the Front field, which is another sign that product is going to be there for the foreseeable future for the limited amount of vessels that are. Also low inventories as we speak. People have been burning their cheap inventories, and I think they will need a significant uplift as we go forward. With this and hopefully safety for everybody, we will be seeing better times. We have not lost a single day in our renewal program. I think as Paul mentioned, we replaced seven vessels, are taking in six brand new vessels, four already earning accretive rates for us.
Two are already chartered and fixed, our shuttle tanker and our LNG. We have tried to keep a tight ship. The security of our seafarers comes first, their mental health, their physical health. Within 3,000 seafarers around the world, we had, I would say, less than 1% COVID cases. We have been successful in containing those. It is a struggle every day. It is a struggle to make sure that our people are safe on board and we're not creating a COVID bubble. It is very important, I think, for all the authorities around the world to make sure that seafarers are considered first line-receivers of the vaccines. We have people having to wait for a month to get their vaccines before they go on board, and this should not be the case.
They should be able to go on board, provide the service to the global economy without having to be penalized or put themselves or their colleagues at risk. It's a very big issue, and we are trying to support various authorities and governments to make sure that this will go on and it will make our life and the life of our seafarers much, much easier, healthier, and it will significantly reduce operating expenses because, in order for us to be able to repatriate many times our long-serving seafarers, we have to navigate the vessels physically into places like South Africa or the Philippines, where there are open borders for them, and they are received in a humane manner. With this, I would like to open the floor for any questions. Thank you very much.
Thank you. Ladies and gentlemen, your first question today comes from Randy Giveans from Jefferies. Please go ahead, your line is open.
Hi, gentlemen. How's it going?
Hello, Randy. Very well. Looking very forward to see you face-to-face one day soon, with or without a mask, that is.
That would be good. Come to Houston, no mask required. If I make it to Athens, I'll let you know. Question around your charters. Can you provide some color on the nine vessels recently chartered, both the rates and the tenor?
Yes. I think we have renewed four of our product carriers for another three years to their existing charter, which is a major state oil company based on our typical accretive minimum and profit-sharing arrangements. Of course, we have used this period of time to charter out and I was very happy to make sure that we chartered out our LNGs from anywhere between up to 10 years without directly either from the shipyard or from the last delivery call. That, as you know, on an LNG, if you have a vessel on the spot, it could cost millions and millions to your bottom line, and we're happy that we do not have to spend any of that. Exactly the opposite, the ships are earning immediately after their current deliveries' accretive rates.
On top of that, we have a conventional suezmax and aframax on yearly charters, extension of charters, and our shuttle tanker for a very long period of time. I think that's a very quick rundown of the nine vessels that we have renewed in the first quarter because we have seen the signs of the charterers looking to take cover.
Got it. Okay. Next question, if you turn to slide seven, just looking at kind of the dividend payouts. We've seen this kind of semi-annual dividend bounce around lately. How do you view the dividend going forward? I know you kind of trimmed it now to $0.10 a share. What was the thought process behind that and kind of outlook from here?
As you know, we are very much dividend driven as an organization. The management and the family involved owns a very large part of the stock. Dividend for us is very important. We're always pro-dividend, and we try not to miss any of our dividend payments. We believe this is the best way to reward. I think as George, our COO, mentioned, in the 20 years of our being, 20 years next year on the stock exchange, we will have paid, hopefully by then, in excess of half a billion dollars in dividends. If you add another $160 million of buybacks, we will have returned between dividends and buybacks more than $650 million to the shareholders.
Got it. All right. I guess lastly, with one Q largely over, how are rates compared to Q4, and where do you expect rates to go from here? Obviously, the forward curve is pricing in some strength. Time charter rates are well above spot rates. Can you give some kind of thoughts on the outlook for the next three, six, nine months?
I have to say, I think we spoke together in November. I mentioned that we are hoping to see a much better first half, depending of any additional lockdowns. On one hand, unfortunately, in places like Europe, we are seeing severe lockdowns happening again that are putting a delay to the full recovery of our rates. On the other hand, we have the positive miracle of the vaccines that I think came out in a very timely manner. Big percentages of the populations are being vaccinated. We are hoping to have at least an open summer around Europe. I am sure the United States, the case is the same. We are glad that the majority of the Far East has been able to control the virus in the last couple of quarters much better.
Although we are facing another, hopefully the last, uphill battle with the lockdowns, I think we could turn a corner as early as next quarter, which is in a couple of weeks. We saw all this happening today. I have to say, we did not organize for the closure of the Suez Canal just because it was our call. It was an incident which will have some delays, but we saw how the futures and the spot market rose just in that. The market is well-balanced. April, May, for sure by June when our annual meeting is, and hopefully we will see you face-to-face, we will be celebrating in a much better market environment.
I'll take a plan. Thanks so much.
Thank you.
Thank you. Ladies and gentlemen, as a reminder, if you'd like to ask a question, please press star and one on your telephone keypad. Star and one to ask a question. Ladies and gentlemen, and once again, if you'd like to ask a question, please press star and one.
Well, if there are no more questions, I will ask our Chairman to give his wise words, and I will close after that.
No wise words, Niko. Thank you all again for joining. We all look forward to 2021 being a great year as well for the company and the stock. Thanks again.
From my side, I would like to wish everybody a very healthy, safe, and prosperous 2021. All of us going back to normality and with all the lessons that we were taught. As I said, exactly a year ago, our COO gathered us here for last year's end of the year results. Exactly a year ago, things were very different. We have all grown through this. We navigated a steady ship in very turbulent waters. We have maintained, and I'm very proud of our renewal program with the new ships. Sold on time, the seven assets, took delivery of four already without losing almost a day in a very difficult environment. Those vessels have already been earning accretive rates, which you see to the bottom line right now. Two more vessels are being built for us.
Hopefully, they will be delivered within this year, one in 2021, and the next one in 2022, both of them on long-term charters. We're also looking at the opportunities out there. I would like to thank all in the Tsakos group for keeping a flawless operation regarding the safety of our seafarers. I think this is a priority for us. Everybody in the group is to make sure that we wake up every morning on a healthy ship. With that, looking forward to speak to you next quarter in a very much better environment. All the best from all of us here in Greece, and happy Easter and holidays to all. Thank you very much.
Thank you. That does conclude our conference for today. Thank you for participating. You may all disconnect.