Time Charter Equivalent (TCE)

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Definition: Time Charter Equivalent (TCE)

Time Charter equivalent is a shipping industry standard that measures the average daily revenue performance of a vessel.

It is calculated by the formula:

TCE = Voyage Revenues – Voyage Expenses/ Round Trip Duration in Days


Typical expenses of a shipping vessel are that of fuel, port and canal costs.

TCE helps in understanding the changes in period-to-period revenue of a shipping vessel. However, it is not a GAAP measure, which implies that companies cannot report this a financial accounting measure, but it can be shown in financial summary as part of footnotes.



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