Owner and operator of LNG carriers GasLog Ltd has undertaken a number of financial transactions in order to remain strong in light of a prolonged downturn in the LNG shipping industry.
Following the company’s completion of a USD 1.3 billion eight newbuild financing during the quarter, “these eight new deliveries are now expected to be fully financed with proceeds of this facility, available cash and cash from operations,” GasLog’s Chief Executive Officer, Paul Wogan, said.
He added that, following GasLog’s conclusion of a USD 576.5 million facility for all 2016 and 2017 debt maturities and the sale and leaseback post quarter-end, the company has no debt maturities until 2018 at the earliest.
GasLog said that, while the rates paid for LNG vessels in the short-term market remain at low levels, in 2016 the company expects that projects in Australia and the US will add approximately 40 million tonnes per annum of new liquefaction nameplate capacity. In Australia, Australia Pacific Train 1 and Gladstone LNG have shipped their first cargoes in recent weeks, while other Australian projects, Gorgon and Australia Pacific Train 2, are due to start up in 2016, and Wheatstone and Prelude should follow in 2017.
Sabine Pass, one of five US projects under construction, shipped its first cargo yesterday, and Angola LNG, which has been shut down for over a year for refurbishment and enhancements, is due to restart in 2016.
With the expected projects coming onstream, the company said it is seeing an encouraging levels of tendering activity for vessels to transport these increased LNG volumes.
“Despite the current downturn in the energy markets, GasLog has continued to perform strongly with all of its contracted vessels operating at 100% utilization through the quarter. This performance alongside the completion of a number of significant financing transactions support GasLog’s payment of a dividend of $0.14 for the quarter,” Wogan said.
GasLog reported that its profit increased to USD 18.2 million in the fourth quarter of 2015, compared to USD 9.9 million recorded in the same period a year earlier. The company’s full year profit stood at USD 53.7 million, an increase from the USD 50.8 million seen in 2014, mainly attributable to an increase in profit from operations and a decrease in loss on swaps, partially offset by an increase in finance costs derived from higher average outstanding debt.
The fourth quarter revenues grew from USD 99 million in 2014 to USD 107.5 million in 2015, while full year revenue rose from USD 328.7 million in 2014 to USD 415.1 million in 2015. GasLog said that the revenues were positively affected by an increase in the operating days in 2015 and negatively affected by the weak spot market conditions in 2015.
GasLog has six newbuildings on order at Samsung Heavy Industries Co., Ltd., and two newbuildings on order at Hyundai Heavy Industries Co., Ltd. Four of these vessels are expected to join the company in 2016, while the rest will follow in 2018 and 2019.