Golar LNG Partners Income Rises (Bermuda)
Golar LNG Partners LP reported net income attributable to unit holders of $27.3 million and operating income of $46.0 million for the fourth quarter of 2012, as compared to net income attributable to unit holders of $25.2 million and operating profit of $35.5 million for the fourth quarter of 20111.
Following the acquisition of the Golar Grand and NR Satu from Golar, the comparative results for the fourth quarter and year ended 2011 assume that the Golar Grand and NR Satu were wholly owned by the Partnership for the entire period that the vessels have been under the common control of Golar.
As required by US GAAP, following the acquisition of the LNG carrier, the Golar Grand from Golar LNG Limited, the results for the fourth quarter and year ended December 31, 2012 and comparative numbers for the fourth quarter and year ended December 31, 2011 assume that the Golar Grand was wholly owned by the Partnership for the entire period that the vessel has been under the common control of Golar. These results therefore include the historical carved out results of the Golar Grand.
There was a significant improvement in operating results for the fourth quarter of 2012 compared to the same period in 2011 due largely to the contribution of the NR Satu. This is because the NR Satu was on hire throughout the fourth quarter of 2012 but was undergoing its conversion to an FSRU during the fourth quarter of 2011 and, therefore, not generating revenues. The Golar Spirit was offhire from December 11, 2012, as planned, when the vessel commenced its transit to its first drydock as an FSRU. Operating results for the fourth quarter have therefore been negatively impacted by this offhire time for Golar Spirit and the related fuel costs. All other vessels operated well throughout the quarter with 100 per cent utilization.
Total offhire time for Golar Spirit drydock is now expected to be approximately eleven weeks. This is not however, expected to be indicative of future drydock offhire time. The Golar Mazo is planned to drydock at the beginning of the second quarter of 2013 but no offhire time is expected due to the time allowance for drydocking provided by the charter. The Methane Princess is expected to drydock towards the end of the second quarter of 2013 and approximately 3-4 weeks offhire time is expected.
Towards the end of the first quarter of 2013 the Golar Winter is expected to commence its drydock and agreed modification work. Golar Winter is expected to be offhire for a total of approximately six weeks commencing March/April 2013. Following the completion of the agreed modification work to Golar Winter, Golar Partners will receive approximately $24 million in additional revenue evenly over the remaining term of the contract (eleven years) commencing in the third quarter of 2013. This is before the effect of rate escalation as provided for in the time charter.
Net interest expenses increased to $10.7 million for the fourth quarter of 2012 compared to $6.8 million for the same period in 2011. This is principally due to additional interest cost associated with the vendor loan from Golar in respect of the NR Satu. During the fourth quarter, the Partnership entered into a $155 million term loan facility and a $20 million revolving loan facility with a group of banks and repaid the vendor loan in respect of the NR Satu in December 2012.
Other financial items loss for the fourth quarter of 2012 of $0.5 million is consistent with the loss of $0.5 million for the fourth quarter of 2011.
The Partnership’s Distributable Cash Flow2 for the fourth quarter of 2012 was $22.4 million as compared to $25.2 million in the third quarter of 2012. These amounts are after adjustments to remove dropdown vessels results prior to their actual acquisition date. The reduction is due to offhire time and fuel cost related to the Golar Spirit drydocking in the fourth quarter as well as higher average operating costs in the fourth quarter. This is offset in part by the contribution of the Golar Grand from November 8, 2012.
On January 23, 2013, Golar Partners declared an increased distribution for the fourth quarter of $0.50 per unit. This represented a 5.3% increase from the third quarter of 2012 and reflected the full accretive value of the acquisition of the Golar Grand. The dividend was paid on February 14, 2013.
LNG World News Staff, February 28, 2013