Navigator .(US:NVGS)2019-11-14 19:56Financial Data and Key Metrics Changes - The third quarter results showed an improvement with a loss of $2.9 million, compared to a loss of $7.7 million in the previous quarter and a profit of $600,000 in the third quarter of 2018 [7][16] - Revenue for the third quarter was $75.6 million, up from $73.6 million in the previous quarter but down from $80.8 million in the third quarter of 2018 [7][8] - EBITDA for the third quarter was $28.4 million, with a total of $79.8 million for the first nine months of 2019 [16] Business Line Data and Key Metrics Changes - Average charter rates increased to $21,446 per day in the third quarter, up from $19,940 per day in the previous quarter and $20,987 per day in the third quarter of 2018 [9] - Utilization rates were 84.6% in the third quarter, down from 85.2% in the previous quarter and 87.5% in the third quarter of 2018 [10] - Time charters accounted for 67% of all vessel operating days, with 33% spent on spot or voyage charters [11] Market Data and Key Metrics Changes - The Handysize Ethylene Shipping segment has not yet seen the full impact of U.S. ethylene exports, which are expected to begin next month [22] - The LPG segment is anticipated to play a larger role in employment compared to the last three years, with time charter rates for Very Large Gas Carriers at $1.3 million per month [25] Company Strategy and Development Direction - The company is focused on leveraging its investments in terminal infrastructure to provide cost-effective routes to market for petrochemical and midstream partners [34] - There is a strong emphasis on the upcoming ethylene export terminal, which is expected to significantly impact the freight environment due to limited availability of ethylene handy ships [23][50] - The company is not currently planning to place newbuild orders for vessels, focusing instead on optimizing existing assets [48] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the transition into 2020, anticipating that the new terminal will begin loading its first cargo soon, which is expected to improve financial performance [62] - The company is confident that the recent contracts secured for the terminal will lead to further commitments and growth opportunities [63] Other Important Information - The company has undertaken a refinancing of the Navigator Aurora vessel through a sale leaseback, which is expected to strengthen the balance sheet [19][20] - Total debt stood at $881.3 million as of September 30, with a recent amendment to the EBITDA to interest covenant providing additional headroom [18] Q&A Session Summary Question: What is the expected payout for the sale and leaseback of Navigator Aurora? - The sale is effectively a financing and will not feature as a sale in the accounts [42] Question: Is Navigator getting strong time charter interest for newbuilds? - There is confidence in the LPG production and some newbuilding orders have been placed, but Navigator has no current intention to place new orders [46][48] Question: What are the shipping requirements for the new export terminal? - Limited handysize ethylene ships are available, and the ethylene shipping market is expected to rise due to new volumes coming from the terminal [50][51] Question: How has utilization been looking for the fourth quarter? - Utilization is creeping upwards, primarily driven by LPG, but no significant jumps are expected [59] Question: What is the expected destination for the cargoes from the export terminal? - The expected split is 25% to Europe and 75% to Asia, based on customer mix [75]