Dorian LPG, a US-listed owner-operator of 25 large LPG carriers, reported on Thursday its lowest quarterly profit reading since 2021 — in line with recent guidance that showed falling spot rates hurting its revenue.
Net income for the three months ended September dropped by 88% year on year to $9.4m.
Results would have been slightly better if the company had not reported a $5.6m unrealised loss on derivatives.
The weak profit reading does not come as a surprise.
The company had already warned on 24 October that it expected revenue to drop by nearly 30% quarter on quarter to between $80.7m and $82.7m, as a result of weaker markets.
According to the final results released today, the revenue decline came in at 28% to $82.4m — its lowest quarterly revenue reading in two years.
Chief executive John Hadjipateras said in the earnings release: “Rates during the quarter reflect a return to a balanced market as the Panama Canal drought effect has reversed.”
Markets had already expected VLGC revenue to decline as the end of Panama Canal disruptions means the market is finally feeling the impact of last year’s newbuilding deliveries.
Dorian LPG’s previous quarters had been some of the most profitable in the 10 years in which the company has been listed in New York.
Hadjipateras said on Thursday that he maintains a positive view of his market.
“The fundamentals of the seaborne LPG trade remain strong,” he said, adding that this expectation underpinned the board’s decision to maintain a steady dividend.
Dorian LPG had already announced on 24 October that it would keep its dividend at the $1 per share it has paid out in 16 out of the past 17 quarters.
The shares closed at a 12-month low of $29.58 on Wednesday, giving the company a market value of $1.26bn, which is still above the $1.18bn net asset value of its fleet at the end of September.
The stock was also hurt over the summer when the company sold $84m in new shares to raise cash for general corporate purchases.
According to the latest available public information, Hadjipateras owned 13.3% of the shares as of May. US investment giant BlackRock owned 13.4% and Texas-based Dimensional Fund Advisors 8.1%.
Dorian LPG owns 21 ships and charters in four.
They are all operating in the company’s Helios pool, except the 84,000-cbm Corsair (built 2014), which has been on a time charter to an oil major that began in November 2019 and is due to expire in the final quarter of 2024.
