BW LPG has seen earnings drop in the third quarter in what remained a volatile spot market for VLGCs.
The Oslo and New York-listed owner said net profit was $120.5m to 30 September, compared to $122.3m in the same period of 2023.
Revenue dropped to $220.4m from $308.7m.
The company said it had experienced “another good quarter for shipping”, with time charter equivalent (TCE) earnings at $46,500 per day.
The dividend will be $0.42 per share, representing a 100% pay-out ratio of shipping profit, or $61.6m
Trading division BW Product Services generated earnings of $58m.
Ebitda of $189m beat Fearnley Securities’ expectations of $160m, driven by a combination of higher TCE and lower cost.
BW LPG added that it had signed a new seven-year $460m revolving credit facility at a “competitive” margin last month.
It gave no further details of the deal that came after it had paid off a $400m facility the month before.
Available liquidity was $750m at the end of the quarter.
Three of the 12 VLGCs bought from Avance Gas in August for $1.05bn have now been delivered.
The third quarter began on a challenging note for VLGC owners, as the Panama Canal normalised operations after reversing drought restrictions, putting sailing distances and ship use under pressure, the company said.
Big swings in rates
Weather and technical issues also meant fluctuations in export volumes.
Volatile spot rates swung as low as $23,000 per day and up to $50,000 during the quarter.
However, LPG exports carried on VLGCs out of North America grew 6.7% in the third quarter, compared to the same period in 2023, reflecting the strong underlying trend in production and exports, the owner added.
“The new locks in the Panama Canal are operating near full capacity, with the old locks increasing throughput as well,” the company said
“While this reduces fleet wide inefficiencies, LNG carriers and dry bulk vessels are also gradually returning to the canal, increasing the competition for transit slots.”
Looking ahead, BW LPG noted several terminal expansion projects in the US, which are expected to support growth in North American LPG exports in the high single-digits for the next three years.
Middle East LPG exports are expected to grow in the mid-single digits over the coming years, driven by higher gas production from new projects in Qatar, UAE and other countries in the region, the owner said.
“The spot market is expected to fluctuate however, driven by weather changes, geopolitical situation, Panama Canal availability and other drivers of the VLGC market,” it added.
