Performance Shipping Inc. (NASDAQ: PSHG) has entered into a three‑year time‑charter with PBF Energy Inc. for its 105,525‑dwt Aframax tanker M/T P. Monterey. The charter carries a daily rate of $31,000, which translates into an estimated $33 million in gross revenue over the minimum period and is scheduled to commence in mid‑February 2026.
The new contract pushes PSHG’s secured backlog to a record $349 million as of January 1, 2026, a key milestone in the company’s strategy to lock in 70 % of 2026 operating days at fixed rates. The additional revenue stream improves cash‑flow predictability and provides a stronger foundation for servicing the $100 million Nordic bond issued in July 2025, which matures in July 2029 and carries a 9.875 % coupon. The charter also supports the company’s broader fleet‑modernization plan, which includes the acquisition of two 2019‑built Suezmax tankers in late 2025.
PBF Energy, the charterer, has faced financial challenges, including negative EBITDA and a delayed refinery restart. While the $31,000 daily rate is attractive, the long‑term commitment introduces counterparty risk that PSHG has mitigated through rigorous due diligence and the inclusion of performance guarantees. The charter’s timing aligns with a broader market trend in which energy companies are seeking longer‑tenor employment to hedge against volatile spot rates.
In the most recent quarter, PSHG reported revenue of $18.1 million, down from $20.5 million in Q2 2024, and net income of $9.1 million versus $10.2 million in the same period last year. The decline in revenue was largely driven by the sale of the vessel P. Yanbu, while the company’s operating leverage helped maintain profitability. The new charter is expected to offset the revenue dip and contribute to a rebound in the next reporting period.
CEO Andreas Michalopoulos said, “This three‑year time charter strengthens our cash‑flow visibility and adds a significant, predictable revenue stream to our portfolio. Securing long‑term employment at a lucrative rate with a solid counterparty underscores our ability to build lasting relationships with energy companies.” He added that the company remains focused on medium‑ and long‑term contracts with staggered maturities to sustain steady earnings and provide renewal opportunities.
The charter’s addition to PSHG’s backlog and its alignment with the company’s fleet‑modernization strategy signal a positive trajectory for future earnings. While counterparty risk remains a consideration, the overall impact on the company’s financial position is favorable, reinforcing its capacity to meet debt obligations and invest in newer, more efficient vessels.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.