French LNG membrane containment system designer GTT pulled in a raft of orders for gas carriers in the first three months of this year, pushing its orderbook to record levels as QatarEnergy firmed up more LNG newbuildings.
In its first-quarter results, GTT said it received 29 new orders for newbuildings in the opening three months of 2024.
Chairman and chief executive Philippe Berterottiere pointed out that the company has since notched up a further eight.
These are understood to be QatarEnergy’s Q-Max vessels that were contracted at China’s Hudong-Zhonghua Shipbuilding (Group).
The CEO, who will step down in June to make way for the new appointee Jean-Baptiste Choimet and remain as chairman, said commercial momentum on orders for the company is continuing unabated.
“We are reaching a record level with 310 LNG carriers in GTT’s orderbook,” he said.
In addition, the company has orders to design the containment systems for eight very large ethane carriers, one floating storage and regasification unit, one floating LNG production unit and nine onshore storage tanks.
But GTT’s orders for vessels utilising LNG as a fuel declined year on year, with no new orders recorded in the first quarter, and the company’s orderbook slimmed to 66 with 10 deliveries.
GTT saw its revenue climb over 81% in the first quarter of this year, up at €144.8m ($154.3m) compared to €79.9m in the same three months of 2023.
Chief financial officer Thierry Hochoa said this was mainly due to more LNG and ethane carriers under construction.
Revenue surged in the LNG as a fuel business, climbing nearly 98% to €9.7m from €4.9m in the same period last year. Moreover, the company’s electrolyser manufacturing business saw returns double to €3m.
GTT confirmed a revenue outlook in the range of €600m to €640m for 2024 and Ebitda between €345m and €385m.
When asked by analysts about revising its forecasts upwards in the face of good results, Hochoa said the company preferred to be cautious as it needed to consider factors such as the involvement of Chinese shipbuilders new to LNG carrier construction and potential production delays.
Berterottiere described long-term LNG demand as “fairly positive” and said that by the end of this decade, some 150m tonnes per annum to 250 mtpa is set to be added to global LNG production, which will require “many ships”.
He said the fleet replacement market is “still to come” and does not see any changes in current newbuilding price levels.
The CEO said GTT is in discussions with other shipbuilders looking at entering the LNG construction sector and is working through the challenges with them.
Only solution
The chief said GTT believes LNG as a fuel is the “only solution” available for reducing CO2 emissions, adding that others are not available or affordable.
He said that when bio-LNG and synthetic LNG, also known as e-LNG, are available, they can serve as drop-in fuels for LNG-fuelled vessels, enabling ships to achieve carbon neutrality.
He said there have been some “illusions” about methanol and ammonia but GTT believes both are “less appropriate”.
Speaking about the new CEO appointment, Berterottiere said it has been a competitive process with internal and external candidates.
Berterottiere said Choimet’s knowledge of the LNG sector, shipping, hydrogen and new energies particularly impressed the selection board along with his achievements in turning around a very small company like GTT subsidiary Elogen — where he currently serves as managing director — in three years to compete with the world’s very large electrolyser manufacturers.
When pressed by one analyst on what Choimet has in mind for GTT, Berterottiere declined to comment urging him: “Be a little bit patient.”
