Financial Data and Key Metrics Changes - For Q1 2024, the company reported a net income of $11.8 million and earnings per common unit of $0.23, with adjusted net income at $12.4 million and adjusted earnings per common unit at $0.25, reflecting an increase of 87.7% in adjusted net income compared to the previous period [13][15] - Adjusted EBITDA for the same period reached $29 million, indicating a 23% increase, primarily driven by higher voyage revenues from the Arctic Aurora following a new charter agreement [15][28] - The company’s total debt outstanding decreased to $345 million, down from $408 million, marking a reduction of $75 million compared to the prior quarter [25][28] Business Line Data and Key Metrics Changes - The fleet consists of six LNG carriers with an average age of approximately 13.9 years, and the contracted backlog stood at approximately $1.07 billion, averaging about $178.3 million per vessel [2][28] - The average remaining charter period for the fleet is approximately 6.6 years, ensuring stable revenue streams [2] Market Data and Key Metrics Changes - The global fleet of energy carriers has expanded rapidly, with the new building order book exceeding 50% of existing fleets, indicating a strong market demand for LNG transportation [16][34] - The company anticipates that the long-term demand for energy will remain strong due to various factors, including the favorable emission profile of natural gas compared to traditional fossil fuels [34] Company Strategy and Development Direction - The company’s commercial strategy focuses on securing long-term charters with prominent gas companies to ensure stable revenue streams, with no contractual vessel availability until 2028 [16][34] - The recent refinancing has provided the company with greater financial flexibility, allowing for a focus on utilizing free cash flow and exploring new opportunities [3][25] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the company’s stable phase, supported by reduced leverage and a solid foundation of contracted cash flows, positioning the partnership well for future growth [3][28] - The management highlighted the importance of evaluating cash flow utilization on a quarter-by-quarter basis, considering both growth and distributions to unitholders [36][37] Other Important Information - The company successfully closed a $345 million lease financing agreement for four LNG carriers, which has enabled the full repayment of existing debt before maturity [25][28] - The equity book value increased from $311 million in September 2019 to $457 million as of March 2024, reflecting significant growth [28] Q&A Session Summary Question: Future cash flow utilization and distribution announcements - Management indicated that cash flow utilization will be evaluated quarterly, and no specific timeline for distribution announcements can be committed to at this moment [36][37] Question: Financing of unencumbered assets - Management stated that while it is theoretically possible to finance the unencumbered assets, the current strategy is to keep them unencumbered to align with the deleveraging strategy [38]
Dynagas LNG Partners LP(DLNG) - 2024 Q1 - Earnings Call Transcript