In a first quarter business update, Cool Company (CoolCo) revealed it had taken delivery of the newbuilding, ’GAIL Sagar’, in January and employed her on long-term charter to GAIL (India), following a delivery voyage to the US Gulf.
GAIL has the option to extend the charter by another two years beyond the firm 14-year charter period.
In addition, CoolCo secured floating and fixed rate employment on two redelivered vessels, starting from the second and third quarters, respectively.
Both vessels had undergone LNGE upgrades.
The company’s other newbuilding, ’Kool Tiger’, has achieved near continuous employment in the spot market during 1Q25, whilst a long-term charter is pursued.
During 1Q25, CoolCo completed two additional drydockings, and another subsequent to the quarter end, with only two out of nine TFDE vessels remaining to be drydocked.
In addition, from 7th April through 16th May, 2025, the company purchased 692,180 shares at an average price of $5.59 per share under its share repurchase programme.
CEO Richard Tyrrell, commented:“CoolCo had an active first quarter, marked by a vessel delivery, several vessels transitioning to new charters and drydockings all contributing to modestly higher quarter-on-quarter revenue.
Two out of our 13 vessels were exposed to a challenging spot market during the period, as high LNG prices and extensive restocking activity drove cargos to Europe, putting downward pressure on tonne/mile demand.
“Given these conditions, we were pleased to deliver the ‘GAIL Sagar’ onto its long-term charter and secure term employment for an additional two vessels.
“Our results for the quarter reflect the one-off cost of positioning the ‘GAIL Sagar’, and we look forward to its full-quarter contribution starting in 2Q25.
“Looking ahead, we continue to expect not only a positive tonne/mile impact from the normalisation of LNG cargo flows between Europe and Asia, but also a significant increase in LNG volumes coming onto the water starting this year, as numerous projects are now on the verge of start-up – or already in commissioning – after years of development and construction.
“While widespread uncertainty related to geopolitics, tariff policy, and their impact on trade patterns remains a source of hesitation for certain charterers, the fixed and tangible nature of their long-term LNG transport needs is prompting a return to securing tonnage on a multi-year basis.
“The geopolitical environment is favourable for new LNG projects, and even before the impact of these additional prospective volumes from new projects, we continue to expect a tightening market driven by post-FID LNG volumes coming online and the expected extensive scrapping of ageing steam turbine vessels now completing existing charters.
“As this process unfolds, we intend to remain patient, disciplined, and focused on maximising long-term shareholder value,” he concluded.
As for the 1Q25 results, CoolCo reported total operating revenues of $85.5 mill, compared to $84.6 mill for the previous quarter.
Net income was $9.1 mill, compared to $29.4 mill for 4Q24, with the decrease primarily related to the unrealised mark-to-market changes on the company’s interest rate swaps.
CoolCo achieved average TCE of $70,600 per day in 1Q2, compared to $73,900 per day for the fourth quarter of last year.
This drop was primarily due to an increase in repositioning expenses for the ‘GAIL Sagar’, before commencing her long-term charter, and another vessel between her spot charters.
Adjusted EBITDA was $53.4 mill for the quarter, compared to $55.3 mill for 4Q24.
As of 31st March, 2025, CoolCo had cash and cash equivalents of $135.4 mill and total short and long-term debt, net of deferred finance charges, amounting to $1,429.6 mill.
Total contractual debt2 stood at $1,446.2 mill, which is comprised of $437.7 mill in respect of the senior secured reducing revolving credit facility (RRCF) maturing in December, 2029, $623.1 mill in the company’s increased $520 mill term loan facility maturing in May, 2029, and the sale and leaseback financing arrangements for the ’Kool Tiger’, amounting to $177.6 mill maturing in October, 2034 and ’GAIL Sagar’, totalling $207.8 mill and maturing in January, 2039.
