In This Article:
BERMUDA, 25 May 2022 – Avance Gas Holding Ltd (OSE: AGAS or the “Company”) today reported unaudited results for the first quarter 2022.
HIGHLIGHTS
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The average time charter equivalent (TCE) rate was $37,608/day compared to $27,631/day in Q4 2021.
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Daily operating expenses (OPEX) were $8,459/day, up from $8,139/day in Q4 2021.
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A&G expenses were $1,126/day, down from $1,351/day in Q4 2021.
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Net profit of $24.3 million compared to $7.5 million for the fourth quarter 2021, or earnings per share of 32 cent compared to 10 cent for the fourth quarter.
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During the first quarter 2022, the CEO and the Chairman elected to step-down. The Board resolved to appoint Øystein Kalleklev as Executive Chairman and Jens Martin Jensen as a Director of the Company.
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During the first quarter 2022, the Company took delivery of Avance Polaris and Avance Capella, the first two of its six dual fuel 91,000 cbm VLGC newbuildings from Daewoo Shipyard in South Korea. The vessels were shortly thereafter delivered on Time Charter Agreements for 2 years.
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During the first quarter 2022, the Company entered two contracts to sell the 2008-built VLGCs Thetis Glory and Providence. These vessels were subsequently delivered to the new owners in March and May, respectively. The transactions generated in total $48.3 million in net cash proceeds at delivery.
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In May 2022, the Company signed a $555 million sustainability-linked term facility with a bank syndicate. The facility is a refinancing of the previous bank facility financing the nine VLGCs including a financing of the newbuildings three and four, Avance Rigel and Avance Avior, for delivery in the fourth quarter 2022 and the first quarter 2023.
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The board declared a dividend of $0.20 per share for Q1 2022 corresponding to $15.3 million.
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For the second quarter of 2022, we estimate TCE rate between approximately $35,000/day and $36,000/day on a discharge to discharge basis and between $32,000/day and $33,000/day on a load to discharge basis.
The first quarter started with a strong LPG price differential between US and Asia lifting the freight rate levels to $50,000/day in January and fell to $25,000/day in February/March due to low US inventory levels, high energy prices narrowing the LPG price arbitrage and high bunker prices eating into the earnings.
The US VLGC exports averaged 80 cargoes per month for the first quarter with March reaching the all-time high record with 90 cargoes which is ~15% above the monthly average for 2021 of 78 cargoes. The growth in the US export capacity states higher terminal utilization in Marcus Hook, Nederland, and Enterprise. The strong US volumes continues into the second quarter with 89 cargoes reported in April.