US-listed Dynagas LNG Partners has taken an earnings hit from scheduled dry-dockings on three of its vessels, engine work and increased finance costs.
Dynagas LNG slashed its third-quarter net income by more than 81% to $1.4m from $7.4m in the same three months of 2022.
But voyage revenues for the quarter were up almost 24% at $37m from $29.9m in the third quarter of last year.
Net income for the first nine months of this year was down at $25.4m from $42.4m year on year.
Voyage revenues rose to $111.9m in the period from $96.6m in the same period of 2022.
Greek owner George Procopiou’s public LNG entity said the drop off in net income was largely due to increases in the vessels operating expenses and scheduled dry-docking costs for three of its vessels — the 155,000-cbm Yenisei River, the Lena River and Arctic Aurora (all built 2013).
The company also blamed the fall on the decrease in interest rate swap gains and the increase in interest and finance costs.
Fleet operating expenses jumped to $19,288 per day per vessel in the quarter up from $12,743 per day a year ago.
The company said this was mainly due to “engine overhauling costs” on its three dry-docked ships during the quarter.
Dynagas LNG said the rise in voyage revenues was mainly attributable to the new time-charter party agreement for the Arctic Aurora — which delivered onto a new three-year contract with Equinor during the quarter — and the increase in available days on the 150,000-cbm LNG carriers Amur River (built 2008) and Ob River (built 2007) compared to a year ago when they were undergoing dry-dockings.
But the company said these returns were partially offset by a decrease in available days from the three vessels that underwent dry-dockings this year.
Speaking on a results briefing, chief financial officer Michael Gregos said the dry-docking costs for the three LNG carriers which completed their scheduled dry-dockings during the quarter stacked up at $17.3m. However, he said $11.6m of this was reimbursed under cost-pass through charter contracts on two of the ships.
Dynagas chief executive Tony Lauritzen said the company remains committed to cutting debt and had repaid $242.4m in the last four years.
The current debt outstanding under the company’s $675m credit facility is approximately $432.6m.
Lauritzen said: “One of our main priorities going forward is to refinance the partnerships debt.”
Dynagas said the average daily hire costs on its LNG carriers during the quarter were around $68,800 per day per vessel compared to $61,560 per day in the same period during 2022.
The company has booked in time-charter business for its six-ship fleet for the next four years.
The partnership said it has contracted time-charter cover for 100% of its fleet’s available days for the rest of 2023 and for the years 2024 to and including 2027 and has “no contractual vessel availability until 2028”.