John Fredriksen’s Avance Gas has extended a series of VLGC sales which will swell its profit by over $120m in the next two quarters.
Oslo-listed Avance Gas today agreed to sell the 83,000-cbm VLGC Venus Glory (built 2008) for $66m in its latest asset play.
The VLGC is currently trading on the spot market after completing a two-year charter deal at the end of the fourth quarter of last year.
Delivery of the ship to the new owner, a national oil company, is expected to take place in February or March.
Avance expects to record a book gain of about $27m. The net cash proceeds after deducting repayment of a bank loan is expected to be around $40m.
Avance chief executive Oystein Kalleklev said: “We are pleased to complete our fleet-renewal programme with the agreement to sell Venus Glory which we have marketed for sale after completion of her two-year time charter.”
In December, Avance sold two VLGC newbuildings for $240m to Pertamina, as TradeWinds reported at the time.
The company expects to book profits of $85m in the first quarter from the sale of three ships Iris Glory, Venus Glory and the fifth dual-fuel VLGC newbuilding which was intended to be named Avance Castor.
In the second quarter, the firm will book a gain of $36 million from the sale of the sixth dual-fuel VLGC newbuilding, which was to be named Avance Pollux.
“In total, we will thus book gains from sale of ships of approximately $121m in the first and second quarter,” Kalleklev told investors.
The net cash proceeds from the sales will run to $185m. This will swell further to $225m when taking into account the swap of the $135m sale-and-leaseback financing for two newbuildings.
“With the sale of Venus Glory, we have during the last two years, sold all our five 2008 and 2009 built ships,” Kalleklev said.
“At the same time, we have taken delivery of four new dual fuel VLGCs as well as contracted four dual fuel MGCs which also can carry ammonia in addition to LPG for delivery in 2025 and 2026.
“With these ship sales and the positive outlook for the VLGC freight market, Avance Gas remain in a very good position to continue to deliver strong returns and attractive dividends to its shareholders,” Kalleklev concluded.
