Recently incorporated LNGC player, Capital Clean Energy Carriers (CCEC), has reported an increase in net income for the third quarter of 2024 to $15.8 mill from $5 mill recorded for 3Q23.
Upon conversion from a Marshall Islands limited partnership to a Marshall Islands corporation, the 348,570 general partner units and all the incentive distribution rights, were exchanged for a total of 3.5 mill common shares.
Some $46.2 mill, representing the difference between the book value of the general partner units and the fair value of the common shares, was presented as a deemed dividend to the General Partner.
As a result, net loss from continuing operations per share for 3Q24, was $0.54. After adjusting for the deemed dividend to the General Partner, the adjusted net income for the quarter, was $0.28. This compares to a net income from continuing operations per common unit of $0.25 for 3Q23.
Total revenue was $106 mill, compared to $63.9 mill during the third quarter of 2023. The risse was attributable to the five newbuilding LNGCs acquired by the company, which increased the average number of vessels from 11 to 15, compared to the same quarter last year.
In November, 2023, Capital decided to focus on the transport of various forms of gas to industrial customers, including LNG and new commodities emerging, due to the energy transition.
More LNGCs
The company agreed to acquire 11 newbuilding LNGCs and in June, 2024, Capital invested in another 10 gas carriers, including four LCO2/multi gas and six LPG-ammonia carriers. Since December, 2023, the company has also completed or entered into agreements for the sale of 12 containerships.
Jerry Kalogiratos, CCEC CEO, commented: “I am pleased to see our company, under its new name of Capital Clean Energy Carriers Corp, advancing steadily in line with our chosen strategy.
“The recent name change and our conversion to a corporation with enhanced standards of corporate governance is an important step in reinforcing our platform further and expanding the company to a broader investor base.
“The accretive sale of our five Neo Panamax container vessels, agreed upon during the quarter, reflects management’s commitment to deliver on our objective of positioning the company as premier carrier of gas, including emerging trades from the energy transition.
“Since February, 2024, our group has taken advantage of positive container market dynamics and in total sold or agreed to sell 12 container vessels raising approximately $472 mill in net proceeds, thereby further strengthening our financial position.
“We believe that with a robust gas-focused platform, CCEC is well placed to grow over the next two years, as we bring an additional 16 state-of-the-art new vessels in operation.
“This growth is further supported by a current contracted revenue backlog of more than $2.6 bill. The board and management look forward to enhancing the company’s profile and reach a broader and more diversified investor base in the current quarter and beyond,” he said.
As of 30th September, 2024, total cash amounted to $183.1 mill, which including restricted cash of $18.3 mill, and represented the minimum liquidity requirement under CCEC’s financing arrangements.
CCEC’s total debt (including debt classified within discontinued operations) was $2,698.1 mill before financing fees, reflecting an increase of $910.3 mill, compared to $1,787.8 mill as of 31st December, 2023.
On 30th October, 2024, CCEC’s Board declared a cash dividend per share of $0.15 for 3Q24 payable on 15th November, 2024, to shareholders of record on 11th November, 2024.
Looking at the market, CCEC said that LNGC 2-stroke spot rates averaged $73,404 per day in 3Q24, compared to $160,308 per day for the same period last year.
Spot rates weakened further into the fourth quarter, despite the typical seasonal patterns, and as a result charter rates are expected to be significantly weaker this year, compared to previous years amidst firm fleet growth and delayed project start-ups.
Overall, while Red Sea disruption and US/Asia volumes have driven a stronger LNGC tonne/ mile trade year-to-date, market conditions remain subdued, due to the increased fleet capacity growth, expected at 7.6% this year and 10.9% in 2025.
