GasLog LNG Partners increases profits ahead of merger and sees seasonal downturn now hitting charter market
GasLog LNG Partners, with an operational fleet of 12 vessels, reported increased revenues and profits as it proceeded with the merger process with affiliate GasLog Ltd.
The company’s quarterly revenues increased 16 percent to $99.07 million from $85.45m in the same three months of 2022.
Net profits rose 4 percent to $36.37M from $34.98M in the prior-year first quarter.
The Partnership’s market overview and outlook said headline spot rates in the first quarter of 2023 for the most modern vessels fell to an average of about $71,560 per day, a fall of 78 percent compared with the average of the fourth quarter of 2022.
Fall in rates
“This fall in rates is mainly due to the seasonal downturn, high inventories, continuing strong flows from the US to Europe and bearish sentiments. This has been compounded by increased availability of relets,” said the Partnership, citing various sources.
One-year time charter rates for tri-fuel diesel-electric propulsion (TFDE) carriers averaged $155,000 per day in the first quarter of 2023, about 18 percent lower than rates in the fourth quarter of 2022, reflecting the seasonal downturn.
Earnings highlights during the first quarter included the Partnership’s sale and bareboat lease-back of the 155,000 cubic metres capacity TFDE vessel “GasLog Sydney”.
The deal was with a wholly-owned subsidiary of China Development Bank Leasing and with no repurchase option or obligation.
The company said a time-charter agreement for the TFDE carrier “GasLog Geneva with a wholly-owned subsidiary of Shell was extended by five years after the exercise of their extension option.
The merger transaction with GasLog Ltd is expected to close by the end of the third quarter of 2023, subject to approval of the holders of a majority of the common units of the Partnership and the satisfaction of certain closing conditions.
GasLog Ltd owns 30.2 percent of the common units of the Partnership and has entered into a support agreement with the Partnership.
“The entering into an Agreement and Plan of Merger with GasLog is a transformative transaction for the Partnership that will enable its unitholders to take advantage of a significant premium to the unit trading price,” said Paolo Enoizi, Chief Executive.
The Partnership’s owned and bareboat fleet comprises the following vessels: “GasLog Sydney”, “GasLog Geneva”, “Methane Rita Andrea”, “Methane Alison Victoria”, “GasLog Gibraltar”, “Solaris”, “GasLog Santiago”, “GasLog Seattle”, “Methane Jane Elizabeth”, “Gaslog Greece”, “GasLog Glasgow” and “Methane Becki Anne”.
