DynaGas LNG Partners in the Red in Q3

Monaco-based owner and operator of liquefied natural gas (LNG) carriers, reported a third-quarter ended September 30, 2018 loss of $654,000, after reporting a profit in the same period a year earlier.

The gas shipping company said that the Q3 results included $2.3 million of scheduled class survey and dry-docking costs related to the Yenisei River, one of the three tri-fuel diesel engine (TFDE) vessels in our fleet.

The company said it had a loss of 7 cents per share. Earnings, adjusted for non-recurring costs, were 4 cents per share. It has posted revenue of $31.3 million in the period, which beat Street forecasts.

Tony Lauritzen, Chief Executive Officer of the Partnership, said: “Our reported earnings for the third quarter of 2018 were in line with our expectations. Compared to the same period in 2017, our third quarter earnings were impacted by the following occurrences: (i) two of our vessels, the Arctic Aurora and the Ob River, commenced employment under extended charter contracts with their respective charterers at lower rates compared with the previous charter contracts, and (ii) the special survey and dry-docking of the Yenisei River."

“Based on our contracted revenue backlog estimate, we have a high level of visibility and predictability in our future cash flow generating capacity, given that all of our LNG carriers are employed on long-term contracts with an average contract duration of approximately ten years, with the first potential vessel availability in the year 2021 (with only one vessel) and thereafter in the year 2026," he added.

"We believe that our best in class contracted revenue backlog estimate of $1.4bn is driven in part by our dominant market share in the ownership and operation of ice class LNG carriers. Going forward we continue to remain focused on the safe and efficient operation of our unique and versatile fleet," Tony said.

The company informed that the Yamal LNG project is progressing well. Immediately after the completion of its special survey, the Yenisei River commenced employment under a long-term contract with Yamal LNG on August 14, 2018, which was earlier than originally agreed in the charter contract and as a result the contract was extended by an additional 180 days to an aggregate term of 15 years and 180 days.

The Lena River is currently employed on a multi-month charter contract with a large US gas producer until the vessel commences employment under its 15 year contract with Yamal LNG, which is expected to commence in the second half of 2019, it said.

“We intend to refinance our $250 million unsecured notes due in October 2019.  We are currently performing a review of all of our refinancing options taking into account, among other things, our financial and growth objectives,” Tony concluded.