Dorian LPG Reaping Fruit from Delivered Newbuilds

Having taken delivery seven vessels under its ECO-design VLGC newbuilding program, owner and operator of modern very large gas carriers Dorian LPG expects higher profits and cash going forward.

Namely, during the third quarter of 2016 fiscal year, Dorian LPG’s fleet was expanded with the Clermont, the Cheyenne, the Cratis, the Commander, the Chaparral, the Copernicus, and the Challenger.

 ” Going forward, we anticipate higher profits and cash generated from operations as a result of our larger fleet, assuming continued favorable market conditions. We will continue to evaluate ways to best return that cash to our investors, underscoring the commitment of both the board and management to increasing shareholder value,” John Hadjipateras, Chairman, President and Chief Executive Officer, commented.

The company reported a net income of USD 54.7 million in the third quarter of 2016 fiscal year and an adjusted EBITDA of USD 68.7 million.

Revenues were USD 93.3 million for the three months ended December 31, 2015, an increase of USD 60.7 million, or 186.3%, from USD 32.6 million for the three months ended December 31, 2014.

The increase is primarily attributable to USD 68.1 million of revenues contributed by sixteen of the company’s newbuilding VLGCs that were delivered subsequent to December 31, 2014.

Global liquefied petroleum gas (LPG) export volumes for the calendar 2015 reached 80 million metric tons, an 11% increase over the previous year.

U.S. LPG exports alone reached a record of nearly 21 million metric tons, which is a 50% increase over the previous year. The U.S. became the largest LPG exporter in the world, accounting for 25% of the global seaborne export volumes, which were shipped to Central and South America, Asia, and Europe and the Mediterranean at about 43%, 29% and 26%, respectively.

The strong LPG export volumes from the U.S. Gulf and in particular large cargo movements (on VLGC vessels) from West to East have increased ton-miles for the segment Dorian LPG has focused on and has supported shipping demand for VLGC vessels.  Other LPG exporting regions have shown export growth in 2015 and have generally contributed to a generally stronger Baltic rate market resulting in strong utilization and freight rates seen by VLGC vessels.

Going forward, as a result of the growth trend, Dorian LPG believes that U.S. LPG export volumes may reach higher levels in 2016, which would support additional ship supply and a reasonably robust freight rate market environment for the sector.