Dynagas LNG Partners Announces Q4, 2018 Results

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Dynagas LNG Partners on Thursday announced its results for the three months and year ended December 31, 2017. The company reported fourth-quarter net income of USD 5.6 million, after reporting a loss in the same period a year earlier.

The company said that it had net income of 11 cents per share. Earnings, adjusted for non-recurring costs, were 16 cents per share.

Highlights:

Net income during the three months and year ended December 31, 2017 of USD 5.6 million and USD 17.3 million, respectively;

Earnings per common unit for the three months and year ended December 31, 2017 of USD 0.11 and USD 0.27, respectively;

Adjusted Net Income(1) for the three months and year ended December 31, 2017 of USD 7.6 million and USD 33.7 million, respectively;

Adjusted Earnings per common unit (1) (2) for the three months and year ended December 31, 2017 of USD 0.16 and USD 0.74, respectively;

Adjusted EBITDA(1) for the three months and year ended December 31, 2017 of USD 26.9 million and USD 107.5 million, respectively;

Reported cash of USD 67.5 million and available liquidity of USD 97.5 million each as of December 31, 2017.

Recent Developments:

New long-term time charter contract for the Arctic Aurora: On December 20, 2017, the Partnership entered into a new three year charter agreement with Statoil ASA for the employment of the Arctic Aurora, its 2013-built, 155,000 cubic meter, tri-fuel diesel engine, ice class LNG carrier.

This new charter for the Arctic Aurora is expected to commence in the third quarter of 2018 in direct continuation of the current charter with Statoil, following the vessel’s mandatory statutory class five-year special survey and dry-docking and has a firm period of about 3 years +/- 30 days. Statoil will have options to extend this charter by two consecutive 12-month periods at escalated rates.

Optional Vessels purchase option deadline extension: On February 6, 2018, the Partnership agreed with its Sponsor to extend the deadline for exercising the purchase options relating to both the Clean Horizon  and the Clean Vision previously granted to the Partnership under the Omnibus Agreement retroactively from their initial expiration in July 2017 and January 2018, respectively, to December 31, 2018.

Tony Lauritzen, Chief Executive Officer of the Partnership, commented:

“We are pleased to report our earnings for the three months and year ended December 31, 2017.”

“Our reported earnings for the fourth quarter of 2017 were, as expected, below those of the fourth quarter of 2016 and were impacted by the following: (i) the temporary employment of the Clean Energy on the spot market until July 2018, when the vessel will commence a time charter with Gazprom for a term of approximately 8 years, and (ii) the longer term nature of our contracts following our decision to reduce the charter hire rate on two vessels, the Yenisei River and the Lena River, with effect from November 2016, in exchange for securing the long-term charter with Gazprom, mentioned above, for the employment of the Clean Energy. These transactions contributed substantially to our contracted backlog, thereby enhancing significantly our revenue visibility.”

“Part of our strategy has been to enter into longer term charters for the employment of the vessels in our fleet. In general, based on the conditions of the charter market, long-term charters may be priced at day rates above or below shorter term charters. With our fleet 85% contracted through 2018, 92% contracted through 2019 and 100% contracted through 2020, and with an estimated fleet-wide average remaining contract duration of 10.4 years, we believe we have significant cash flow visibility. We expect to increase contract coverage going forward on the back of an improving LNG shipping market.”

“Our revenues are derived from the employment of our vessels on fixed multi-year charter contracts. The revenues we earn under those charter contracts are earned on a fixed day rate basis and not linked in any way to commodity price fluctuations,” he added.

Sea News, February 16