Dorian LPG Q4 2023 Earnings Report
Key Takeaways
Dorian LPG Ltd. reported revenues of $133.6 million and a net income of $76.0 million for the fourth quarter ended March 31, 2023. The company's TCE rate for the fleet was $68,135. They also declared and paid an irregular dividend totaling $40.4 million.
Revenues for Q4 2023 reached $133.6 million.
Net income for Q4 2023 was $76.0 million, or $1.89 earnings per diluted share (EPS).
Adjusted EBITDA for Q4 2023 stood at $102.1 million.
Time charter equivalent (TCE) per operating day rate for the fleet was $68,135.
Dorian LPG
Dorian LPG
Forward Guidance
The global oil and gas markets and macroeconomic concerns, coupled with factors specific to the LPG trade, drove a volatile first calendar quarter of 2023 in the LPG market. Currently, the VLGC orderbook stands at approximately 20% of the current global fleet.
Positive Outlook
- OPEC+ production cuts announced in April 2023 are expected to maintain the “higher” oil prices over the second calendar quarter of 2023.
- The relaxation of lockdown restrictions in China raised hopes of increased demand for feedstocks and olefins/polyolefins which in turn were expected to improve petrochemical economics globally as demand for products returns.
- Two new propane dehydrogenation plants started operating in the first calendar quarter of 2023 with a flurry of new plants are still expected to come online throughout 2023, leading to the expectation of higher demand for imports in China.
- Lower bunker prices however resulted in higher time charter equivalent rates.
- Overall, the robust VLGC supply/demand balance, strong arbitrage and logistical constraints have continued to keep freight rates above the five-year highs.
Challenges Ahead
- Global oil and gas markets and macroeconomic concerns, coupled with factors specific to the LPG trade, drove a volatile first calendar quarter of 2023 in the LPG market.
- The Baltic VLGC index softened in the first calendar quarter of 2023 from an average of around $120 per metric ton in the fourth calendar quarter of 2022 to around $88 per metric ton in the first calendar quarter of 2023.
- A further twelve new VLGCs were added during the first calendar quarter of 2023 helping to soften the freight rates.
- Currently, the VLGC orderbook stands at approximately 20% of the current global fleet.
- An additional 70 VLGCs, equivalent to roughly 6.2 million cbm of carrying capacity, are expected to be added to the global fleet by calendar year 2026.