Dorian LPG(US:LPG)2025-01-30 23:31Revenue Performance - Total revenues for the three months ended December 31, 2024, were $80.7 million, a decrease of $82.4 million, or 50.5%, from $163.1 million for the same period in 2023, primarily due to reduced average TCE rates[110]. - Total revenues for the nine months ended December 31, 2024, were $277.5 million, a decrease of $141.9 million or 33.8% from $419.3 million for the same period in 2023[117]. TCE Rates - Average TCE rates declined by $35,867 per available day from $71,938 in Q4 2023 to $36,071 in Q4 2024, influenced by lower spot rates[110]. - Average Time Charter Equivalent (TCE) rates declined by $20,541 per available day, from $61,719 in 2023 to $41,178 in 2024[117]. Market Conditions - The Baltic Exchange Liquid Petroleum Gas Index averaged $55.717 during Q4 2024, compared to $132.773 in Q4 2023, indicating a significant drop in spot market rates[110]. Operating Expenses - Vessel operating expenses increased by $2.2 million, or 11.7%, to $21.4 million in Q4 2024, resulting in an average of $11,097 per vessel per calendar day[111]. - Vessel operating expenses increased by $1.5 million or 2.4% to $61.5 million for the nine months ended December 31, 2024, with daily expenses rising from $10,392 to $10,642 per vessel per calendar day[118]. - General and administrative expenses were $7.5 million for Q4 2024, a decrease of $0.2 million, or 2.5%, from $7.7 million in Q4 2023[112]. - General and administrative expenses rose by $3.8 million or 12.8% to $34.3 million for the nine months ended December 31, 2024, driven by increases in stock-based compensation and cash bonuses[119]. Financial Costs - Interest and finance costs decreased by $1.2 million, or 11.8%, to $8.9 million in Q4 2024, primarily due to a reduction in average indebtedness[113]. - Interest and finance costs decreased by $3.0 million or 9.6% to $27.8 million for the nine months ended December 31, 2024, due to a reduction in average indebtedness[120]. - Interest income increased to $3.8 million in Q4 2024, up from $2.9 million in Q4 2023, attributed to higher average cash balances[114]. - Interest income increased by $5.4 million to $12.0 million for the nine months ended December 31, 2024, attributed to higher average cash balances[121]. Derivatives and Unrealized Gains/Losses - Unrealized gain on derivatives amounted to $2.9 million in Q4 2024, compared to a loss of $6.1 million in Q4 2023, reflecting a favorable change in the fair value of interest rate swaps[115]. - Unrealized loss on derivatives increased by $1.4 million to $3.1 million for the nine months ended December 31, 2024, primarily due to unfavorable changes in interest rate swaps[122]. Cash Flow and Liquidity - Cash and cash equivalents as of December 31, 2024, were $314.5 million, indicating strong liquidity[133]. - For the nine months ended December 31, 2024, the company generated $122.8 million in cash from operations, a decrease of $111.4 million compared to $234.2 million for the same period in 2023[146]. - Net cash used in financing activities for the nine months ended December 31, 2024, was $86.6 million, down from $164.5 million in the same period in 2023[149]. - The company anticipates satisfying its liquidity needs for at least the next twelve months through cash on hand, cash from operations, and potential drawdowns on its revolving credit facility[135]. Debt and Financing - The outstanding balance of long-term debt as of December 31, 2024, was $565.9 million, which includes $53.9 million scheduled for repayment within the next twelve months[134]. - The company issued 2 million shares at $44.50 per share on June 7, 2024, raising net proceeds of approximately $84.4 million after underwriting discounts and commissions[139]. - The company expects to finance future acquisitions through internally generated funds, public or private debt financings, or equity securities[145]. Future Commitments and Investments - The company has approximately $98.4 million in commitments under newbuilding contracts for a VLGC/AC expected to be delivered in the second quarter of 2026[155]. - A newbuilding VLGC/AC with a capacity of 93,000 cbm is expected to be delivered in Q2 2026, with an installment payment of $11.9 million made in January 2025[103]. Industry Context - The LPG shipping industry is capital intensive, requiring significant investments in vessels, upgrades, and maintenance[166]. Hedging and Interest Rate Exposure - As of December 31, 2024, the company has hedged $152.0 million of amortizing principal under the 2023 A&R Debt Facility, representing 80% of the outstanding indebtedness[166]. - A hypothetical increase or decrease of 20 basis points in SOFR rates would result in a change of $0.1 million in interest expense on all non-hedged interest-bearing debt[166]. - The company has entered into interest rate swap agreements to hedge exposure to fluctuations in interest rates associated with its debt financing[166]. - Increased interest rates could adversely impact future earnings due to additional interest expense on the unhedged portion of the debt[166]. Environmental Compliance - The company has installed scrubbers on fifteen vessels to comply with emissions regulations, with ongoing costs included in drydocking and survey expenses[154].