Teekay LNG Partners has had a profitable second quarter, bolstered by newly delivered vessels and lower expenses.
Net income was $16.4m during the period, a little behind what was seen in the previous three months but ahead of the $2.7m profit posted in the second quarter of 2018.
Earnings were boosted by the nine LNG carrier newbuildings delivered into the partnership’s fleet and joint ventures between May 2018 and June this year, Teekay LNG said.
Fleet earnings
Voyage revenue has increased by 25% and was $153m during the second quarter, compared to $122.3m in the same period last year.
Teekay's revenues have also been helped by higher earnings from the partnership's seven multi-gas carriers and the higher charter rate earned by the 173,000-cbm VLGC Torben Spirit (built 2017) since its redeployment in December.
“Looking ahead, we expect our financial results for the second half of this year to continue to improve now that each of these new charters have commenced," said Mark Kremin, Teekay Gas Group chief executive.
Kremin said this would lead to "higher utilisation and higher revenues, coupled with fewer drydocks and the expected delivery of another three 50%-owned Yamal Arc7 LNG newbuildings and the start-up of the Bahrain LNG regasification terminal".
Teekay LNG took delivery of its third Arc7 LNG carrier newbuilding during the quarter, which has commenced a 27-year charter contract servicing the Yamal LNG project.
The fourth such vessel is scheduled to deliver mid-August.
Tankers
Not all vessels did so well, however, and Teekay LNG's conventional tanker fleet saw lower earnings during the second quarter, mainly due to its reduced size.
The owned fleet now comprises one MR product tanker, following the sales of Teekay LNG's last two suezmax tankers between October 2018 and January.
The partnership also saw lower vessel operating expenses during the quarter, and lower general and administrative expenses, which it said was due to lower corporate costs.
In mid-July, Teekay LNG announced its plans to pay $0.19 per unit for the second quarter, which Kremin said was a balance between higher returns to investors and ongoing efforts to cut debt.
